The following is a summary of the Modine Manufacturing Company (MOD) Q4 2024 Earnings Call Transcript:

Financial Performance:

• Modine reported a 5% increase in annual sales totaling $2.4 billion.

• Delivered 48% growth in Adjusted EBITDA reaching $314 million, buoyed by strategic realignment that led to a 13.1% adjusted EBITDA margin.

• Made significant changes to its portfolio in Q4, including two acquisitions and divestitures of three automotive businesses in Germany and two coatings businesses in the U.S.

• The data center sales in the Climate Solutions segment grew by 69% contributing to a 31% increase in adjusted EBITDA of the segment.

• The Performance Technologies segment marked a 67% increase in adjusted EBITDA.

• Estimations for the future include a 50 basis points per year lift in margin from implementing 80/20 in Climate Solutions and around $100 million impact from divestitures and product line exits in Performance Technologies.

Business Progress:

• Modine is focused on driving favourable changes in their sales mix and exploring new product applications.

• The company predicts 60%-70% growth in its data center business, driven by both organic and inorganic factors.

• Plans to expand production capacity in the data center segment, setting an ambitious target of building a $1-billion business.

• Intentions to continue refining commercial practices and exploring cross-selling opportunities and pricing strategies for margin expansion.

• Expectation to launch CDUs (Cooling Distribution Units) by the end of the calendar year, pending market readiness.

• In the automotive segment, the company is focusing on reducing financial drain whilst still meeting the set targets.

More details: Modine Manufacturing IR

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