QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
Large Accelerated Filer ☐
|
|
||
Non-accelerated Filer ☐
|
Smaller reporting company
|
||
Emerging growth company
|
PART I.
FINANCIAL INFORMATION
|
|
1
|
|
27
|
|
41
|
|
42
|
|
PART II. OTHER INFORMATION
|
|
42 |
|
43 |
|
43 | |
44
|
Three months ended
December 31,
|
Nine months
ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Net sales
|
$
|
|
$
|
|
$ | $ | ||||||||||
Cost of sales
|
|
|
||||||||||||||
Gross profit
|
|
|
||||||||||||||
Selling, general and administrative expenses
|
|
|
||||||||||||||
Restructuring expenses
|
|
|
||||||||||||||
Impairment charges (reversals) – net
|
(
|
)
|
|
( |
) | |||||||||||
Loss on sale of assets
|
|
|
||||||||||||||
Operating income (loss)
|
|
(
|
)
|
( |
) | |||||||||||
Interest expense
|
(
|
)
|
(
|
)
|
( |
) | ( |
) | ||||||||
Other expense – net
|
(
|
)
|
(
|
)
|
( |
) | ( |
) | ||||||||
Earnings (loss) before income taxes
|
|
(
|
)
|
( |
) | |||||||||||
Provision for income taxes
|
(
|
)
|
(
|
)
|
( |
) | ( |
) | ||||||||
Net earnings (loss)
|
|
(
|
)
|
( |
) | |||||||||||
Net earnings attributable to noncontrolling interest
|
(
|
)
|
(
|
)
|
( |
) | ( |
) | ||||||||
Net earnings (loss) attributable to Modine
|
$
|
|
$
|
(
|
)
|
$ | $ | ( |
) | |||||||
Net earnings (loss) per share attributable to Modine shareholders:
|
||||||||||||||||
Basic
|
$
|
|
$
|
(
|
)
|
$ | $ | ( |
) | |||||||
Diluted
|
$
|
|
$
|
(
|
)
|
$ | $ | ( |
) | |||||||
Weighted-average shares outstanding:
|
||||||||||||||||
Basic
|
|
|
||||||||||||||
Diluted
|
|
|
Three months ended
December 31,
|
Nine months
ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Net earnings (loss)
|
$
|
|
$
|
(
|
)
|
$ | $ | ( |
) | |||||||
Other comprehensive income (loss):
|
||||||||||||||||
Foreign currency translation
|
(
|
)
|
|
( |
) | |||||||||||
Defined
benefit plans, net of income taxes of $
|
|
|
||||||||||||||
Cash
flow hedges, net of income taxes of $
|
|
|
( |
) | ||||||||||||
Total other comprehensive income (loss)
|
(
|
)
|
|
|||||||||||||
Comprehensive income (loss)
|
|
(
|
)
|
( |
) | |||||||||||
Comprehensive income attributable to noncontrolling interest
|
(
|
)
|
(
|
)
|
( |
) | ( |
) | ||||||||
Comprehensive income (loss) attributable to Modine
|
$
|
|
$
|
(
|
)
|
$ | $ | ( |
) |
December 31, 2021
|
March 31, 2021
|
|||||||
ASSETS
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Trade accounts receivable – net
|
|
|
||||||
Inventories
|
|
|
||||||
Assets held for sale
|
|
|
||||||
Other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
Property, plant and equipment – net
|
|
|
||||||
Intangible assets – net
|
|
|
||||||
Goodwill
|
|
|
||||||
Deferred income taxes
|
|
|
||||||
Other noncurrent assets
|
|
|
||||||
Total assets
|
$
|
|
$
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Short-term debt
|
$
|
|
$
|
|
||||
Long-term debt – current portion
|
|
|
||||||
Accounts payable
|
|
|
||||||
Accrued compensation and employee benefits
|
|
|
||||||
Liabilities held for sale
|
|
|
||||||
Other current liabilities
|
|
|
||||||
Total current liabilities
|
|
|
||||||
Long-term debt
|
|
|
||||||
Deferred income taxes
|
|
|
||||||
Pensions
|
|
|
||||||
Other noncurrent liabilities
|
|
|
||||||
Total liabilities
|
|
|
||||||
Commitments and contingencies (see Note 18)
|
||||||||
Shareholders’ equity:
|
||||||||
Preferred stock, $
|
|
|
||||||
Common stock, $
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Retained earnings
|
|
|
||||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
||||
Treasury stock, at cost,
|
(
|
)
|
(
|
)
|
||||
Total Modine shareholders’ equity
|
|
|
||||||
Noncontrolling interest
|
|
|
||||||
Total equity
|
|
|
||||||
Total liabilities and equity
|
$
|
|
$
|
|
Nine months
ended December 31,
|
||||||||
2021
|
2020
|
|||||||
Cash flows from operating activities:
|
||||||||
Net earnings (loss)
|
$
|
|
$
|
(
|
)
|
|||
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
|
|
||||||
Impairment charges (reversals) – net
|
(
|
)
|
|
|||||
Loss on sale of assets
|
|
|
||||||
Stock-based compensation expense
|
|
|
||||||
Deferred income taxes
|
(
|
)
|
|
|||||
Other – net
|
|
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Trade accounts receivable
|
|
|
||||||
Inventories
|
(
|
)
|
|
|||||
Accounts payable
|
|
|
||||||
Other assets and liabilities
|
(
|
)
|
|
|||||
Net cash provided by operating activities
|
|
|
||||||
Cash flows from investing activities:
|
||||||||
Expenditures for property, plant and equipment
|
(
|
)
|
(
|
)
|
||||
Proceeds from (payments for) disposition of assets
|
(
|
)
|
|
|||||
Disbursements for loan origination (see Note 1) | ( |
) | ||||||
Other – net
|
|
|
||||||
Net cash used for investing activities
|
(
|
)
|
(
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Borrowings of debt
|
|
|
||||||
Repayments of debt
|
(
|
)
|
(
|
)
|
||||
Borrowings (repayments) on bank overdraft facilities – net
|
(
|
)
|
|
|||||
Financing fees paid
|
(
|
)
|
(
|
)
|
||||
Dividend paid to noncontrolling interest
|
(
|
)
|
|
|||||
Other – net
|
(
|
)
|
(
|
)
|
||||
Net cash provided by (used for) financing activities
|
|
(
|
)
|
|||||
Effect of exchange rate changes on cash
|
(
|
)
|
|
|||||
Net increase in cash, cash equivalents, restricted cash and cash held for sale
|
|
|
||||||
Cash, cash equivalents, restricted cash and cash held for sale – beginning of period
|
|
|
||||||
Cash, cash equivalents, restricted cash and cash held for sale – end of period
|
$
|
|
$
|
|
Common stock
|
Additional
|
Retained
|
Accumulated other
|
Treasury stock,
|
Non-controlling
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
paid-in capital
|
earnings
|
comprehensive loss
|
at cost
|
interest
|
Total
|
|||||||||||||||||||||||||
Balance, March 31, 2021
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||||
Net earnings
|
-
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income
|
-
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Stock options and awards
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Purchase of treasury stock
|
-
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Dividend paid to noncontrolling interest
|
- | ( |
) | ( |
) | |||||||||||||||||||||||||||
Balance, June 30, 2021
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||||
Net earnings
|
-
|
|||||||||||||||||||||||||||||||
Other comprehensive loss
|
-
|
( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||
Stock options and awards
|
||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|||||||||||||||||||||||||||||||
Balance, September 30, 2021
|
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | |||||||||||||||||||||
Net earnings
|
-
|
|||||||||||||||||||||||||||||||
Other comprehensive income (loss)
|
-
|
( |
) | ( |
) | |||||||||||||||||||||||||||
Stock options and awards
|
||||||||||||||||||||||||||||||||
Purchase of treasury stock
|
- | ( |
) | ( |
) | |||||||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|||||||||||||||||||||||||||||||
Balance, December 31, 2021
|
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ |
Common stock
|
Additional
|
Retained
|
Accumulated other
|
Treasury stock,
|
Non-controlling
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
paid-in capital
|
earnings
|
comprehensive loss
|
at cost
|
interest
|
Total
|
|||||||||||||||||||||||||
Balance, March 31, 2020
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||||
Net (loss) earnings
|
-
|
|
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||||||||||||
Other comprehensive income
|
-
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Stock options and awards
|
|
|
(
|
)
|
|
|
|
|
|
|||||||||||||||||||||||
Purchase of treasury stock
|
-
|
|
|
|
|
(
|
)
|
|
(
|
)
|
||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance, June 30, 2020
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||||
Net earnings
|
-
|
|||||||||||||||||||||||||||||||
Other comprehensive income
|
-
|
|||||||||||||||||||||||||||||||
Stock options and awards
|
||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|||||||||||||||||||||||||||||||
Balance, September 30, 2020
|
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | |||||||||||||||||||||
Net (loss) earnings
|
-
|
( |
) | ( |
) | |||||||||||||||||||||||||||
Other comprehensive income
|
-
|
|||||||||||||||||||||||||||||||
Stock-based compensation expense
|
-
|
|||||||||||||||||||||||||||||||
Balance, December 31, 2020
|
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ |
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
ASSETS
|
||||
Cash and cash equivalents
|
$
|
|
||
Trade accounts receivable – net
|
|
|||
Inventories
|
|
|||
Other current assets
|
|
|||
Property, plant and equipment – net
|
|
|||
Other noncurrent assets
|
|
|||
Impairment of carrying value
|
(
|
)
|
||
Total assets held for sale
|
$
|
|
||
LIABILITIES
|
||||
Short-term debt
|
$
|
|
||
Accounts payable
|
|
|||
Accrued compensation and employee benefits
|
|
|||
Other current liabilities
|
|
|||
Pensions
|
|
|||
Other noncurrent liabilities
|
|
|||
Total liabilities held for sale
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31,
2021
|
Three months ended December 31,
2020
|
|||||||||||||||||||||||||||||||||||||||
BHVAC
|
CIS
|
HDE
|
Automotive
|
Segment
Total
|
BHVAC
|
CIS
|
HDE
|
Automotive
|
Segment
Total
|
|||||||||||||||||||||||||||||||
Primary end market:
|
||||||||||||||||||||||||||||||||||||||||
Commercial HVAC&R
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Data center cooling
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Industrial cooling
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Commercial vehicle
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Off-highway
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Automotive and light vehicle
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Geographic location:
|
||||||||||||||||||||||||||||||||||||||||
Americas
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Europe
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Asia
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Timing of revenue recognition:
|
||||||||||||||||||||||||||||||||||||||||
Products transferred at a point in time
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Products transferred over time
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Nine months
ended December 31, 2021
|
Nine months
ended December 31, 2020
|
|||||||||||||||||||||||||||||||||||||||
BHVAC
|
CIS
|
HDE
|
Automotive
|
Segment
Total
|
BHVAC
|
CIS
|
HDE
|
Automotive
|
Segment
Total
|
|||||||||||||||||||||||||||||||
Primary end market:
|
||||||||||||||||||||||||||||||||||||||||
Commercial HVAC&R
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Data center cooling
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Industrial cooling
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Commercial vehicle
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Off-highway
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Automotive and light vehicle
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Geographic location:
|
||||||||||||||||||||||||||||||||||||||||
Americas
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Europe
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Asia
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Timing of revenue recognition:
|
||||||||||||||||||||||||||||||||||||||||
Products transferred at a point in time
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||||||
Products transferred over time
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Net sales
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
December 31, 2021
|
March 31, 2021
|
|||||||
Contract assets
|
$
|
|
$
|
|
||||
Contract liabilities
|
|
|
• |
Level 1 – Quoted prices for identical instruments in active markets.
|
• |
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived
valuations in which all significant inputs are observable in active markets.
|
• |
Level 3 – Model-derived valuations in which one or more significant inputs are not observable.
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended
December 31,
|
Nine months ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Service cost
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Interest cost
|
|
|
|
|
||||||||||||
Expected return on plan assets
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Amortization of unrecognized net loss
|
|
|
|
|
||||||||||||
Net periodic benefit cost
|
$
|
|
$
|
|
$
|
|
$
|
|
Nine months ended December 31, |
||||||||||||||||
2021 | 2020 | |||||||||||||||
Shares
|
Fair Value
Per Award
|
Shares |
Fair Value
Per Award
|
|||||||||||||
Stock options
|
|
$
|
|
$ | ||||||||||||
Restricted stock awards
|
|
$
|
|
$ | ||||||||||||
Unrestricted stock awards | $ | $ |
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Nine months ended December 31, |
||||||||
2021 |
2020 | |||||||
Expected life of awards in years
|
|
|||||||
Risk-free interest rate
|
|
%
|
% | |||||
Expected volatility of the Company’s stock
|
|
%
|
% | |||||
Expected dividend yield on the Company’s stock
|
|
%
|
% |
|
Unrecognized
Compensation
Expense
|
Weighted-Average
Remaining Service
Period in Years
|
||||||
Stock options
|
$
|
|
|
|||||
Restricted stock awards
|
|
|
||||||
Performance stock awards
|
|
|
||||||
Total
|
$
|
|
|
Three months ended
December 31,
|
Nine months ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Employee severance and related benefits
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Other restructuring and repositioning expenses
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31,
|
||||||||
2021
|
2020
|
|||||||
Beginning balance
|
$
|
|
$
|
|
||||
Additions
|
|
|
||||||
Payments
|
(
|
)
|
(
|
)
|
||||
Reclassified from (to) held for sale |
( |
) | ||||||
Effect of exchange rate changes
|
(
|
)
|
|
|||||
Ending balance
|
$
|
|
$
|
|
Nine months ended December 31, | ||||||||
2021 |
2020 |
|||||||
Beginning balance | $ | $ | ||||||
Additions | ||||||||
Payments | ( |
) | ( |
) | ||||
Reclassified from (to) held for sale |
( |
) | ||||||
Effect of exchange rate changes | ( |
) | ||||||
Ending balance | $ | $ |
Three months ended
December 31,
|
Nine months
ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Interest income
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Foreign currency transactions (a)
|
(
|
)
|
|
(
|
)
|
|
||||||||||
Net periodic benefit cost (b)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total other expense – net
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
(a) |
|
(b) |
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended
December 31,
|
Nine months ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Net earnings (loss) attributable to Modine
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||||
Weighted-average shares outstanding - basic
|
|
|
|
|
||||||||||||
Effect of dilutive securities
|
|
|
|
|
||||||||||||
Weighted-average shares outstanding - diluted
|
|
|
|
|
||||||||||||
Earnings (loss) per share:
|
||||||||||||||||
Net earnings (loss) per share - basic
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||||
Net earnings (loss) per share - diluted
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
December 31, 2021
|
March 31, 2021
|
|||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Restricted cash
|
|
|
||||||
Cash and restricted cash held for sale
|
|
|
||||||
Total cash, cash equivalents, restricted cash and cash held for sale
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
December 31, 2021
|
March 31, 2021
|
|||||||
Raw materials
|
$
|
|
$
|
|
||||
Work in process
|
|
|
||||||
Finished goods
|
|
|
||||||
Total inventories
|
$
|
|
$
|
|
December 31, 2021
|
March 31, 2021
|
|||||||
Land
|
$
|
|
$
|
|
||||
Buildings and improvements (
|
|
|
||||||
Machinery and equipment (
|
|
|
||||||
Office equipment (
|
|
|
||||||
Construction in progress
|
|
|
||||||
|
|
|||||||
Less: accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
Net property, plant and equipment
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
BHVAC
|
CIS
|
Total
|
||||||||||
Goodwill, March 31, 2021
|
$
|
|
$
|
|
$
|
|
||||||
Effect of exchange rate changes
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Goodwill, December 31, 2021
|
$
|
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
December 31, 2021
|
March 31, 2021
|
|||||||||||||||||||||||
Gross
Carrying
Value
|
Accumulated
Amortization
|
Net
Intangible
Assets
|
Gross
Carrying
Value
|
Accumulated
Amortization
|
Net
Intangible
Assets
|
|||||||||||||||||||
Customer relationships
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Trade names
|
|
(
|
)
|
|
|
(
|
)
|
|
||||||||||||||||
Acquired technology
|
|
(
|
)
|
|
|
(
|
)
|
|
||||||||||||||||
Total intangible assets
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
Three months ended December 31,
|
||||||||
2021
|
2020
|
|||||||
Beginning balance
|
$
|
|
$
|
|
||||
Warranties recorded at time of sale
|
|
|
||||||
Adjustments to pre-existing warranties
|
(
|
)
|
(
|
)
|
||||
Settlements
|
(
|
)
|
(
|
)
|
||||
Reclassified from (to) held for sale |
( |
) |
||||||
Effect of exchange rate changes
|
|
|
||||||
Ending balance
|
$
|
|
$
|
|
Nine months
ended December 31,
|
||||||||
2021
|
2020
|
|||||||
Beginning balance
|
$
|
|
$
|
|
||||
Warranties recorded at time of sale
|
|
|
||||||
Adjustments to pre-existing warranties
|
(
|
)
|
(
|
)
|
||||
Settlements
|
(
|
)
|
(
|
)
|
||||
Reclassified from (to) held for sale |
( |
) | ||||||
Effect of exchange rate changes
|
|
|
||||||
Ending balance
|
$
|
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Balance Sheet Location
|
December 31, 2021
|
March 31, 2021
|
||||||||
Lease Assets
|
||||||||||
Operating lease ROU assets
|
|
$
|
|
$
|
|
|||||
Finance lease ROU assets (a)
|
|
|
|
|||||||
Lease Liabilities
|
||||||||||
Operating lease liabilities
|
|
$
|
|
$
|
|
|||||
Operating lease liabilities
|
|
|
|
|||||||
Finance lease liabilities
|
|
|
|
|||||||
Finance lease liabilities
|
|
|
|
(a) |
|
Three months ended
December 31,
|
Nine months ended
December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Operating lease
expense (a)
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Finance lease
expense:
|
||||||||||||||||
Depreciation of
ROU assets
|
|
|
|
|
||||||||||||
Interest on
lease liabilities
|
|
|
|
|
||||||||||||
Total lease
expense
|
$
|
|
$
|
|
$
|
|
$
|
|
(a)
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
_
|
Fiscal year of maturity
|
December 31, 2021
|
March 31, 2021
|
||||||
Term loans
|
|
$
|
|
$
|
|
||||
Revolving credit facility
|
|
|
|
||||||
|
|
|
|
||||||
|
|
|
|
||||||
Other (a)
|
|
|
|||||||
|
|
||||||||
Less: current portion
|
(
|
)
|
(
|
)
|
|||||
Less: unamortized debt issuance costs
|
(
|
)
|
(
|
)
|
|||||
Total long-term debt
|
$
|
|
$
|
|
(a) |
|
Fiscal Year
|
||||
Remainder of 2022
|
$
|
|
||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
2027 & beyond
|
|
|||
Total
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31, 2021
|
Nine months ended
December 31, 2021
|
|||||||||||||||||||||||||||||||
Foreign
Currency
Translation
|
Defined
Benefit
Plans
|
Cash Flow
Hedges
|
Total
|
Foreign
Currency
Translation
|
Defined
Benefit
Plans
|
Cash Flow
Hedges
|
Total
|
|||||||||||||||||||||||||
Beginning balance
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||||||||
Other comprehensive income (loss) before reclassifications
|
(
|
)
|
|
|
(
|
)
|
(
|
)
|
|
|
(
|
)
|
||||||||||||||||||||
Reclassifications:
|
||||||||||||||||||||||||||||||||
Amortization of unrecognized net loss (a)
|
-
|
|
-
|
|
-
|
|
-
|
|
||||||||||||||||||||||||
Unrecognized net pension loss in disposed business (b)
|
- | - | - | - | ||||||||||||||||||||||||||||
Realized gains - net (c)
|
-
|
-
|
(
|
)
|
(
|
)
|
-
|
-
|
(
|
)
|
(
|
)
|
||||||||||||||||||||
Income taxes
|
|
|
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||||||||||||
Total other comprehensive income (loss)
|
(
|
)
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|
||||||||||||||||||||
Ending balance
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
Three months ended December 31, 2020
|
Nine months ended
December 31, 2020
|
|||||||||||||||||||||||||||||||
Foreign
Currency
Translation
|
Defined
Benefit
Plans
|
Cash Flow
Hedges
|
Total
|
Foreign
Currency
Translation
|
Defined
Benefit
Plans
|
Cash Flow
Hedges
|
Total
|
|||||||||||||||||||||||||
Beginning balance
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
|||||||||
Other comprehensive income before reclassifications
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Reclassifications:
|
||||||||||||||||||||||||||||||||
Amortization of unrecognized net loss (a)
|
-
|
|
-
|
|
-
|
|
-
|
|
||||||||||||||||||||||||
Realized (gains) losses - net (c)
|
-
|
-
|
(
|
)
|
(
|
)
|
-
|
-
|
|
|
||||||||||||||||||||||
Income taxes
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||||||||||||
Total other comprehensive income
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Ending balance
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
(a) |
|
(b) |
|
(c) |
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31,
|
||||||||||||||||||||||||
2021
|
2020
|
|||||||||||||||||||||||
External
Sales
|
Inter-segment
Sales
|
Total
|
External
Sales
|
Inter-segment
Sales
|
Total
|
|||||||||||||||||||
Net sales:
|
||||||||||||||||||||||||
BHVAC
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||
CIS
|
|
|
|
|
|
|
||||||||||||||||||
HDE
|
|
|
|
|
|
|
||||||||||||||||||
Automotive
|
|
|
|
|
|
|
||||||||||||||||||
Segment total
|
|
|
|
|
|
|
||||||||||||||||||
Corporate and eliminations
|
-
|
(
|
)
|
(
|
)
|
-
|
(
|
)
|
(
|
)
|
||||||||||||||
Net sales
|
$
|
|
$
|
-
|
$
|
|
$
|
|
$
|
-
|
$
|
|
Nine months
ended December 31,
|
||||||||||||||||||||||||
2021
|
2020
|
|||||||||||||||||||||||
External
Sales
|
Inter-segment
Sales
|
Total
|
External
Sales
|
Inter-segment
Sales
|
Total
|
|||||||||||||||||||
Net sales:
|
||||||||||||||||||||||||
BHVAC
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||
CIS
|
|
|
|
|
|
|
||||||||||||||||||
HDE
|
|
|
|
|
|
|
||||||||||||||||||
Automotive
|
|
|
|
|
|
|
||||||||||||||||||
Segment total
|
|
|
|
|
|
|
||||||||||||||||||
Corporate and eliminations
|
-
|
(
|
)
|
(
|
)
|
-
|
(
|
)
|
(
|
)
|
||||||||||||||
Net sales
|
$
|
|
$
|
-
|
$
|
|
$
|
|
$
|
-
|
$
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31,
|
Nine months
ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
|
$’s
|
|
% of sales
|
|
$’s
|
|
% of sales
|
|
$’s
|
|
% of sales
|
|
$’s
|
|
% of sales
|
|||||||||||||||||
Gross profit:
|
||||||||||||||||||||||||||||||||
BHVAC
|
$
|
|
|
%
|
$
|
|
|
%
|
$
|
|
|
%
|
$
|
|
|
%
|
||||||||||||||||
CIS
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
||||||||||||||||||||
HDE
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
||||||||||||||||||||
Automotive
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
||||||||||||||||||||
Segment total
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
||||||||||||||||||||
Corporate and eliminations
|
(
|
)
|
|
|
|
|
|
(
|
)
|
|
||||||||||||||||||||||
Gross profit
|
$
|
|
|
%
|
$
|
|
|
%
|
$
|
|
|
%
|
$
|
|
|
%
|
Three months ended December 31,
|
Nine months
ended December 31,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Operating income:
|
||||||||||||||||
BHVAC
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
CIS
|
|
(
|
)
|
|
|
|||||||||||
HDE
|
|
|
|
|
||||||||||||
Automotive
|
|
(
|
)
|
|
(
|
)
|
||||||||||
Segment total
|
|
(
|
)
|
|
(
|
)
|
||||||||||
Corporate and eliminations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Operating income (loss)
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
December 31, 2021
|
March 31, 2021
|
|||||||
Total assets:
|
||||||||
BHVAC
|
$
|
|
$
|
|
||||
CIS
|
|
|
||||||
HDE
|
|
|
||||||
Automotive
|
|
|
||||||
Corporate and eliminations (a)
|
(
|
)
|
(
|
)
|
||||
Total assets
|
$
|
|
$
|
|
(a)
|
|
Table of Contents |
MODINE MANUFACTURING COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions, except per share amounts)
(unaudited)
|
Three months ended December 31,
|
Nine months ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
(in millions)
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
||||||||||||||||||||||||
Net sales
|
$
|
502.2
|
100.0
|
%
|
$
|
484.3
|
100.0
|
%
|
$
|
1,475.7
|
100.0
|
%
|
$
|
1,293.5
|
100.0
|
%
|
||||||||||||||||
Cost of sales
|
427.6
|
85.1
|
%
|
401.6
|
82.9
|
%
|
1,261.6
|
85.5
|
%
|
1,083.9
|
83.8
|
%
|
||||||||||||||||||||
Gross profit
|
74.6
|
14.9
|
%
|
82.7
|
17.1
|
%
|
214.1
|
14.5
|
%
|
209.6
|
16.2
|
%
|
||||||||||||||||||||
Selling, general and administrative expenses
|
50.3
|
10.0
|
%
|
56.1
|
11.6
|
%
|
161.6
|
11.0
|
%
|
151.6
|
11.7
|
%
|
||||||||||||||||||||
Restructuring expenses
|
2.1
|
0.4
|
%
|
0.9
|
0.2
|
%
|
3.0
|
0.2
|
%
|
7.0
|
0.5
|
%
|
||||||||||||||||||||
Impairment charges (reversals) – net
|
(57.2
|
)
|
-11.4
|
%
|
134.4
|
27.8
|
%
|
(55.7
|
)
|
-3.8
|
%
|
134.4
|
10.4
|
%
|
||||||||||||||||||
Loss on sale of assets
|
-
|
-
|
-
|
-
|
6.6
|
0.4
|
%
|
-
|
-
|
|||||||||||||||||||||||
Operating income (loss)
|
79.4
|
15.8
|
%
|
(108.7
|
)
|
-22.5
|
%
|
98.6
|
6.7
|
%
|
(83.4
|
)
|
-6.5
|
%
|
||||||||||||||||||
Interest expense
|
(3.8
|
)
|
-0.8
|
%
|
(4.6
|
)
|
-0.9
|
%
|
(11.8
|
)
|
-0.8
|
%
|
(15.2
|
)
|
-1.2
|
%
|
||||||||||||||||
Other expense – net
|
(1.1
|
)
|
-0.2
|
%
|
(0.5
|
)
|
-0.1
|
%
|
(1.6
|
)
|
-0.1
|
%
|
(1.0
|
)
|
-0.1
|
%
|
||||||||||||||||
Earnings (loss) before income taxes
|
74.5
|
14.8
|
%
|
(113.8
|
)
|
-23.5
|
%
|
85.2
|
5.8
|
%
|
(99.6
|
)
|
-7.7
|
%
|
||||||||||||||||||
Provision for income taxes
|
(0.1
|
)
|
-
|
(81.6
|
)
|
-16.8
|
%
|
(7.4
|
)
|
-0.5
|
%
|
(95.3
|
)
|
-7.4
|
%
|
|||||||||||||||||
Net earnings (loss)
|
$
|
74.4
|
14.8
|
%
|
$
|
(195.4
|
)
|
-40.3
|
%
|
$
|
77.8
|
5.3
|
%
|
$
|
(194.9
|
)
|
-15.1
|
%
|
Three months ended December 31,
|
Nine months ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
(in millions)
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
||||||||||||||||||||||||
Net sales
|
$
|
90.6
|
100.0
|
%
|
$
|
73.7
|
100.0
|
%
|
$
|
234.7
|
100.0
|
%
|
$
|
196.3
|
100.0
|
%
|
||||||||||||||||
Cost of sales
|
63.2
|
69.7
|
%
|
48.3
|
65.5
|
%
|
169.5
|
72.2
|
%
|
131.8
|
67.1
|
%
|
||||||||||||||||||||
Gross profit
|
27.4
|
30.3
|
%
|
25.4
|
34.5
|
%
|
65.2
|
27.8
|
%
|
64.5
|
32.9
|
%
|
||||||||||||||||||||
Selling, general and administrative expenses
|
13.0
|
14.4
|
%
|
10.5
|
14.3
|
%
|
35.1
|
15.0
|
%
|
28.9
|
14.8
|
%
|
||||||||||||||||||||
Operating income
|
$
|
14.4
|
15.9
|
%
|
$
|
14.9
|
20.1
|
%
|
$
|
30.1
|
12.8
|
%
|
$
|
35.6
|
18.1
|
%
|
Three months ended December 31,
|
Nine months ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
(in millions)
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
||||||||||||||||||||||||
Net sales
|
$
|
148.6
|
100.0
|
%
|
$
|
124.9
|
100.0
|
%
|
$
|
456.2
|
100.0
|
%
|
$
|
369.6
|
100.0
|
%
|
||||||||||||||||
Cost of sales
|
130.9
|
88.1
|
%
|
112.0
|
89.7
|
%
|
399.4
|
87.5
|
%
|
324.8
|
87.9
|
%
|
||||||||||||||||||||
Gross profit
|
17.7
|
11.9
|
%
|
12.9
|
10.3
|
%
|
56.8
|
12.5
|
%
|
44.8
|
12.1
|
%
|
||||||||||||||||||||
Selling, general and administrative expenses
|
12.4
|
8.4
|
%
|
13.1
|
10.4
|
%
|
37.7
|
8.3
|
%
|
36.0
|
9.7
|
%
|
||||||||||||||||||||
Restructuring expenses
|
1.9
|
1.3
|
%
|
0.5
|
0.4
|
%
|
2.1
|
0.5
|
%
|
4.4
|
1.2
|
%
|
||||||||||||||||||||
Impairment charge
|
-
|
-
|
-
|
-
|
0.3
|
0.1
|
%
|
-
|
-
|
|||||||||||||||||||||||
Operating income (loss)
|
$
|
3.4
|
2.2
|
%
|
$
|
(0.7
|
)
|
-0.5
|
%
|
$
|
16.7
|
3.6
|
%
|
$
|
4.4
|
1.2
|
%
|
Three months ended December 31,
|
Nine months ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
(in millions)
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
||||||||||||||||||||||||
Net sales
|
$
|
200.8
|
100.0
|
%
|
$
|
185.6
|
100.0
|
%
|
$
|
598.4
|
100.0
|
%
|
$
|
474.7
|
100.0
|
%
|
||||||||||||||||
Cost of sales
|
178.6
|
88.9
|
%
|
159.6
|
86.0
|
%
|
535.3
|
89.5
|
%
|
413.8
|
87.2
|
%
|
||||||||||||||||||||
Gross profit
|
22.2
|
11.1
|
%
|
26.0
|
14.0
|
%
|
63.1
|
10.5
|
%
|
60.9
|
12.8
|
%
|
||||||||||||||||||||
Selling, general and administrative expenses
|
11.7
|
5.9
|
%
|
13.2
|
7.1
|
%
|
37.4
|
6.2
|
%
|
35.4
|
7.4
|
%
|
||||||||||||||||||||
Restructuring expenses
|
0.2
|
0.1
|
%
|
-
|
-
|
0.7
|
0.1
|
%
|
1.9
|
0.4
|
%
|
|||||||||||||||||||||
Operating income
|
$
|
10.3
|
5.1
|
%
|
$
|
12.8
|
6.8
|
%
|
$
|
25.0
|
4.2
|
%
|
$
|
23.6
|
5.0
|
%
|
Three months ended December 31,
|
Nine months ended December 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||||||||||||||||||
(in millions)
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
$'s
|
% of sales
|
||||||||||||||||||||||||
Net sales
|
$
|
72.4
|
100.0
|
%
|
$
|
113.9
|
100.0
|
%
|
$
|
224.0
|
100.0
|
%
|
$
|
285.9
|
100.0
|
%
|
||||||||||||||||
Cost of sales
|
64.9
|
89.6
|
%
|
95.5
|
83.9
|
%
|
196.1
|
87.6
|
%
|
246.1
|
86.1
|
%
|
||||||||||||||||||||
Gross profit
|
7.5
|
10.4
|
%
|
18.4
|
16.1
|
%
|
27.9
|
12.4
|
%
|
39.8
|
13.9
|
%
|
||||||||||||||||||||
Selling, general and administrative expenses
|
9.7
|
13.4
|
%
|
8.5
|
7.4
|
%
|
30.1
|
13.4
|
%
|
25.5
|
8.9
|
%
|
||||||||||||||||||||
Restructuring expenses
|
-
|
-
|
0.4
|
0.4
|
%
|
0.2
|
0.1
|
%
|
0.6
|
0.2
|
%
|
|||||||||||||||||||||
Impairment charges (reversals) – net
|
(57.2
|
)
|
-79.0
|
%
|
134.4
|
118.0
|
%
|
(56.0
|
)
|
-25.0
|
%
|
134.4
|
47.0
|
%
|
||||||||||||||||||
Operating income (loss)
|
$
|
55.0
|
76.0
|
%
|
$
|
(124.9
|
)
|
-109.7
|
%
|
$
|
53.6
|
24.0
|
%
|
$
|
(120.7
|
)
|
-42.2
|
%
|
• |
The impact of the COVID-19 pandemic on the national and global economy, our business, suppliers (and the supply chain), customers, and employees;
|
• |
Economic, social and political conditions, changes, challenges and unrest, particularly in the geographic, product and financial markets where we and our customers operate and
compete, including, in particular, foreign currency exchange rate fluctuations; supply chain disruptions; inflation; tariffs (and any potential trade war resulting from tariffs or retaliatory actions); changes in interest rates; recession
and recovery therefrom; restrictions and uncertainty associated with cross-border trade or public health crises, such as pandemics and epidemics, including the ongoing COVID-19 pandemic; and the general uncertainties about the impact of
regulatory and/or policy changes, including those related to tax and trade, the COVID-19 pandemic and other matters, that have been or may be implemented in the U.S. or abroad, as well as continuing uncertainty regarding the implications
of “Brexit”;
|
• |
The impact of price increases associated with raw materials, including aluminum, copper, steel and stainless steel (nickel), and other purchased component inventory including, but
not limited to, increases in the underlying material cost based upon the London Metal Exchange and related premiums, fabrication, or freight costs. These prices may be impacted by a variety of factors, including changes in trade laws and
tariffs, the behavior of our suppliers and significant fluctuations in demand. This risk includes our ability to successfully manage our exposure and our ability to adjust product pricing in response to price increases, whether through
our quotation process or through contract provisions for prospective price adjustments, as well as the inherent lag in timing of such contract provisions; and
|
• |
The impact of current and future environmental laws and regulations on our business and the businesses of our customers, including our ability to take advantage of opportunities to
supply alternative new technologies to meet environmental and/or energy standards and objectives.
|
• |
The overall health and continually increasing price-down focus of our vehicular customers in light of economic and market-specific factors, and the potential impact on us from any
deterioration in the stability or performance of any of our major customers;
|
• |
The impact of any problems, including logistic and transportation challenges, associated with suppliers meeting our quantity, quality, price and timing demands, and the overall
health of our suppliers, including their ability and willingness to supply our volume demands if their production capacity becomes constrained;
|
• |
Our ability to maintain current customer relationships and compete effectively for new business, including our ability to offset or otherwise address increasing pricing pressures
from competitors and price reduction and overall service pressures from customers, particularly in the face of macro-economic instability;
|
• |
The impact of product or manufacturing difficulties or operating inefficiencies, including any program launch and product transfer challenges and warranty claims and delays or
inefficiencies resulting from restrictions imposed in response to the COVID-19 pandemic;
|
• |
The impact of any delays or modifications initiated by major customers with respect to the timing of projects, program launches, product applications or volume requirements,
including order volume changes associated with supply chain challenges, such as semiconductor shortages;
|
• |
Our ability to consistently structure our operations in order to develop and maintain a competitive cost base with appropriately skilled and stable labor, while also positioning
ourselves geographically, so that we can continue to support our customers with the technical expertise and market-leading products they demand and expect from Modine;
|
• |
Our ability to effectively and efficiently modify our cost structure in response to sales volume increases or decreases and to complete restructuring activities and realize the
anticipated benefits of those activities;
|
• |
Costs and other effects of the investigation and remediation of environmental contamination; particularly when related to the actions or inactions of others and/or facilities over
which we have no control;
|
• |
Our ability to recruit and maintain talent, including personnel in managerial, leadership, operational and administrative functions, in light of tight global labor markets;
|
• |
Our ability to protect our proprietary information and intellectual property from theft or attack by internal or external sources;
|
• |
The impact of any substantial disruption or material breach of our information technology systems, and any related delays, problems or costs;
|
• |
Increasingly complex and restrictive laws and regulations, including those associated with being a U.S. public company and others present in various jurisdictions in which we
operate, and the costs associated with compliance therewith;
|
• |
Work stoppages or interference at our facilities or those of our major customers and/or suppliers;
|
• |
The constant and increasing pressures associated with healthcare and associated insurance costs; and
|
• |
Costs and other effects of litigation, claims, or other obligations.
|
• |
Our ability to successfully realize anticipated benefits from strategic initiatives and the implementation of our 80/20 strategy, through which we are focused on growing businesses
with strong market drivers;
|
• |
Our ability to identify and execute strategies in our automotive businesses to reduce costs and improve operating margins;
|
• |
Our ability to identify and execute growth and diversification opportunities in order to position us for long-term success; and
|
• |
The potential impacts from any actions by activist shareholders, including disruption of our business and related costs.
|
• |
Our ability to fund our global liquidity requirements efficiently for Modine’s current operations and meet our long-term commitments in the event of disruption in or tightening of
the credit markets or extended recessionary conditions in the global economy;
|
• |
The impact of potential increases in interest rates, particularly in LIBOR and the Euro Interbank Offered Rate (“EURIBOR”) in relation to our variable-rate debt obligations;
|
• |
The impact of changes in federal, state or local tax regulations that could have the effect of increasing our income tax expense;
|
• |
Our ability to comply with the financial covenants in our credit agreements, including our leverage ratio (net debt divided by Adjusted EBITDA, as defined in our credit agreements)
and our interest coverage ratio (Adjusted EBITDA divided by interest expense, as defined in our credit agreements);
|
• |
The potential unfavorable impact of foreign currency exchange rate fluctuations on our financial results; and
|
• |
Our ability to effectively realize the benefits of deferred tax assets in various jurisdictions in which we operate.
|
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 4. |
Controls and Procedures.
|
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds.
|
Period
|
Total Number of
Shares Purchased
|
Average
Price Paid
Per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
|
Maximum Number (or
Approximate Dollar Value)
of Shares that May Yet
Be Purchased Under the
Plans or Programs (a)
|
October 1 – October 31, 2021
|
36,644 (b)
|
$11.94
|
_______
|
$50,000,000
|
November 1 – November 30, 2021
|
_______
|
_______
|
_______
|
50,000,000
|
December 1 – December 31, 2021
|
4,189 (b)
|
$10.20
|
_______
|
50,000,000
|
Total
|
40,833 (b)
|
$11.76
|
_______
|
(a) |
Effective November 5, 2020, the Board of Directors approved a two-year, $50.0 million share repurchase program, which allows the Company to repurchase Modine common stock through
solicited and unsolicited transactions in the open market or in privately-negotiated or other transactions, at such times and prices and upon such other terms as the authorized officers of the Company deem appropriate.
|
(b) |
Consists of shares delivered back to the Company by employees and/or directors to satisfy tax withholding obligations that arise upon the vesting of stock awards. The Company,
pursuant to its equity compensation plans, gives participants the opportunity to turn back to the Company the number of shares from the award sufficient to satisfy tax withholding obligations that arise upon the termination of
restrictions. These shares are held as treasury shares.
|
Item 5. |
Other Information.
|
Item 6. |
Exhibits.
|
(a)
|
Exhibits:
|
Exhibit No.
|
Description
|
Incorporated Herein By
Reference To
|
Filed
Herewith
|
|
Termination Agreement by and between the Company and Dana Incorporated, dated as of October 25, 2021.
|
Exhibit 2.1 to Registrant’s Current Report on Form 8-K dated October 25, 2021
|
|||
Separation Letter Agreement between the Company and Joel T. Casterton, dated as of October 25, 2021.
|
X
|
|||
Separation Letter Agreement between the Company and Matthew J. McBurney, dated as of October 30, 2021.
|
X
|
|||
Rule 13a-14(a)/15d-14(a) Certification of Neil D. Brinker, President and Chief Executive Officer.
|
X
|
|||
Rule 13a-14(a)/15d-14(a) Certification of Michael B. Lucareli, Executive Vice President, Chief Financial Officer.
|
X
|
|||
Section 1350 Certification of Neil D. Brinker, President and Chief Executive Officer.
|
X
|
|||
Section 1350 Certification of Michael B. Lucareli, Executive Vice President, Chief Financial Officer.
|
X
|
|||
101.INS
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
|
X
|
||
101.SCH
|
Inline XBRL Taxonomy Extension Schema.
|
X
|
||
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
|
X
|
||
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.
|
X
|
||
10.1.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document.
|
X
|
||
10.1.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
|
X
|
||
104
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).
|
X
|