Slides
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Investor Presentation November 2025
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Forward-Looking Statements 2 This presentation contains statements, including information about future financial performance and market conditions, accompanied by phrases such as “believes,” “estimates,” “expects,” “plans,” “anticipates,” “intends,” “projects,” and other similar “forward-looking” statements, as defined in the Private Securities Litigation Reform Act of 1995. Modine's actual results, performance or achievements may differ materially from those expressed or implied in these statements because of certain risks and uncertainties, including, but not limited to those described under “Risk Factors” in Item 1A of Part I of the Company's Annual Report on Form 10-K for the year ended March 31, 2025. Other risks and uncertainties include, but are not limited to, the following: the impact of potential adverse developments or disruptions in the global economy and financial markets, including impacts related to inflation, energy costs, government incentive or funding programs, supply chain challenges or supplier constraints, logistical disruptions, tariffs, sanctions and other trade issues or cross-border trade restrictions; the impact of other economic, social and political conditions, changes and challenges in the markets where we operate and compete, including foreign currency exchange rate fluctuations, changes in interest rates, tightening of the credit markets, recession or recovery therefrom, restrictions associated with importing and exporting and foreign ownership, public health crises, and the general uncertainties, including the impact on demand for our products and the markets we serve from regulatory and/or policy changes that have been or may be implemented in the U.S. or abroad, including those related to tax and trade, climate change, public health threats, and military conflicts, including the conflicts in Ukraine and in the Middle East and tensions in the Red Sea; the overall health and pricing focus of our customers; changes or threats to the market growth prospects for our customers; our ability to successfully realize anticipated benefits, including improved profit margins and cash flow, from our strategic initiatives and our application of 80/20 principles across our businesses; our ability to be at the forefront of technological advances and the impacts of any changes in the adoption rate of technologies that we expect to drive sales growth; our ability to accelerate growth organically and through acquisitions and successfully integrate acquired businesses; our ability to successfully exit portions of our business that do not align with our strategic plans; our ability to effectively and efficiently manage our operations in response to sales volume changes, including maintaining adequate production capacity to meet demand in our growing businesses while also completing restructuring activities and realizing benefits thereof; our ability to fund our global liquidity requirements efficiently and comply with the financial covenants in our credit agreements; operational inefficiencies as a result of product or program launches, unexpected volume increases or decreases, product transfers and warranty claims; the impact on Modine of any significant increases in commodity prices, particularly aluminum, copper, steel and stainless steel (nickel) and other purchased components and related costs, and our ability to adjust product pricing in response to any such increases; our ability to recruit and maintain talent in managerial, leadership, operational and administrative functions and to mitigate increased labor costs; our ability to protect our proprietary information and intellectual property from theft or attack; the impact of any substantial disruption or material breach of our information technology systems; costs and other effects of environmental investigation, remediation or litigation and the increasing emphasis on environmental, social and corporate governance matters; our ability to realize the benefits of deferred tax assets; and other risks and uncertainties identified in our public filings with the U.S. Securities and Exchange Commission. Forward- looking statements are as of the date of this presentation, and we do not assume any obligation to update any forward-looking statements.
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3 Always evolving our portfolio of products in pursuit of highly engineered, mission-critical thermal solutions Engineering A Cleaner, Healthier World Integrity Committed People Centric Technology Driven Results Oriented Team Focused Improve Indoor Air Quality Reduce Water & Energy Consumption Lower Harmful Emissions Enable Cleaner Running Vehicles Use Environmentally Friendly Refrigerants OUR VISION OUR PURPOSE OUR VALUES OUR MISSION
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Heat Transfer Solutions 21% HVAC Technologies 10% On-Highway Applications 28% Heavy-Duty Equipment 16% Modine At-a-Glance 4 Positioned for Growth with Strong Product Portfolio and Global Footprint Performance Technologies Climate Solutions 41 Manufacturing Facilities in 14 Countries1 Americas: Europe: Asia: ~11,300 Employees$2.6B FY2025 Sales $392M FY2025 Adjusted EBITDA 18 15 8 Modine Headquarters Performance Technologies Facility Climate Solutions Facility 25% Data Centers 1As of March 31, 2025, excludes Coatings locations 44% 56% See appendix for Non-GAAP reconciliations.
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Strategic Pillars Driving Value Creation Capitalizing on our deep expertise in thermal management to deliver differentiated solutions and sustained market leadership Leveraging our portfolio of highly engineered, mission-critical thermal solutions to accelerate growth Entering a multi-year growth cycle powered by multiple secular mega-trends Elevating our 80/20 discipline by influencing daily decision-making and strategic resource and capital allocation Evolving our portfolio to compound shareholder value by focusing on high-growth, high-margin businesses for sustainable growth and returns 80 20 5
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Deep Expertise in Thermal Management 6 Over a century of leadership in thermal management Strong relationships with leading companies across many diversified industries Patent-protected, fit-for-purpose innovation meeting customers’ unique needs Advanced technical test centers and lab capabilities driving product development Proprietary technology and footprint creates ongoing value for our customers HIGHLY ENGINEERED, MISSION-CRITICAL thermal solutions to meet the needs of our customers
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Secular Mega-Trends Driving Long-Term Growth 7 Clean, Healthy Indoor Air Quality Growing emphasis on health and safety in schools, and public buildings driving demand for clean air solutions High-Performance Computing Rapid expansion of AI fueling explosive data center growth, with commensurate need for cooling solutions Electrification Solving the critical thermal transition to zero-emission mobility with smart electric components and technology Global Emission Standard Regulations Provide thermal components and systems to shift to low-carbon energy solutions driving demand for cleaner, more efficient thermal management Low Global Warming Potential Refrigerant Regulations Tighter regulation of refrigerants driving demand for new, higher performing equipment
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80/20 is Repetitive and Timeless Modine in the Early Phases of 80/20 Journey, with Rapid Improvements Already Achieved High Margin & High Growth Financial Profile Low Margin & Low Growth Modine’s 80/20 Maturity Model Starting Point Current Progress FocusedGrowth&Innovation Transition&MixShift Clean Up & Simplify 80/20 Value Creation Simplification Segmentation Focused Growth Performance Culture Efficiency Strategy Alignment FocusedGrowth&Innovation Transition&MixShift Clean Up & Simplify 80/20 Value Creation Simplification Segmentation Focused Growth Performance Culture Efficiency Strategy Alignment FocusedGrowth&Innovation Transition&MixShift Clean Up & Simplify 80/20 Value Creation Simplification Segmentation Focused Growth Performance Culture Efficiency Strategy Alignment Clean Up & Simplify Transition & Mix Shift Focused Growth & Innovation • Our 80/20 journey is a repetitive cycle • Each turn drives renewed focus on business strategy and investment for profitable growth • The result is an ongoing evolution of the business portfolio with higher financial targets and returns
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Entry into DC market - Acquisition of Airedale in the UK Acquisition of Luvata, adding global coils, coolers and coatings. Added first strategic hyperscaler customer. Acquisition of Napps Technology, adding Jetson branded chillers 2005 2015 Evolving Portfolio Through Strategic Acquisitions and Divestitures 9 Expanding Our Thermal Management Capabilities to Serve High-Growth Markets and Accelerate Growth Acquisition of TMGcore, adding immersion cooling technology Acquisition of Scott Springfield Manufacturing, adding evaporative cooling technology. Added second strategic hyperscaler customer. 2020 2025 Acquisitions of AbsolutAire and L.B. White, adding complementary heating products and markets Divestiture of Austrian (2021) and German (2023) automotive manufacturing facilities Adding Strategic Products and Technologies while Divesting Non-Strategic Business to Improve Business Mix Acquisition of Climate by Design International, adding desiccant dehumidification and air handling equipment Confirmed plan to exit $250M of incremental non-strategic business
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PERFORMANCE TECHNOLOGIES Business Segments and Product Groups 10 Heat exchangers for heavy-duty agricultural, construction and mining equipment and stationary power generation Heat exchangers for commercial vehicle, specialty vehicle and automotive applications Heavy-Duty Equipment On-Highway Applications CLIMATE SOLUTIONS Heat Transfer Solutions HVAC Technologies Data Centers 21% 10% 25% Heat exchangers for a variety of HVAC&R applications, commercial refrigeration coolers and anti-corrosive coatings Provider of custom make-up air, heating, ventilation, and air conditioning systems for the commercial, industrial, and healthcare sectors Provider of a full line of software-optimized data center cooling solutions FY2025 Percent of SalesFY2025 Percent of Sales 16% 28%
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Performance Technologies Performance Technologies provides engineered products and solutions that enhance fuel economy, minimize harmful emissions and increase reliability in harsh environments On-Highway Applications FY25 External Sales $721M Heavy-Duty Equipment FY25 External Sales $422M Product Groups 11 See appendix for Non-GAAP reconciliations Revenue 1% CAGR $1,164M $1,125M Adjusted EBITDA Margin 13.5% 5.5% +800 bps 3-Year Financial Performance (Transformation Began in FY22)
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• Evolving the business portfolio by applying 80/20 principles • Simplifying product groups to remove cost and complexity • Heavy-Duty Equipment includes off-highway and stationary power products • On-Highway Applications includes automotive and commercial vehicle products for ICE and EV powertrains • Streamlining operations and reducing costs in response to ongoing market weakness and uncertainty • Vehicular markets remain challenged with uncertainty resulting from ongoing tariff situation, expecting year-over-year revenue decline in FY26 • Working to advance exit of non-strategic business • Improved cost structure and business mix will allow for further margin improvement on lower revenues and strong conversion when markets recover Performance Technologies – Strategic Priorities to Increase Profitability 12 FocusedInnovation&Growth Transition&MixShift Clean Up & Simplify Simplification Segmentation Focused Growth Performance Culture Efficiency Strategy Alignment 80/20 Value Creation
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Climate Solutions Climate Solutions provides energy-efficient, safe, climate-controlled solutions, and components for a wide range of mission-critical applications Liquid-Cooled Applications Advanced Solutions Air-Cooled Applications Data Centers FY25 External Sales $644M Heat Transfer Solutions FY25 External Sales $539M HVAC Technologies FY25 External Sales $257M 13 $1,441M $955M 15% CAGR Revenue 21.0% 11.6% +940 bps Adjusted EBITDA Margin Product Groups 3-Year Financial Performance (Transformation Began in FY22) See appendix for Non-GAAP reconciliations
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Climate Solutions – Leveraging Data Center Market Growth 14 • Provider of full system solutions for data center cooling with a suite of products designed to deliver flexible solutions and superior service to global colocation operators and hyperscale customers • Centralized smart building management systems that remotely monitor performance and energy consumption • Aim to leverage the Airedale brand to expand into telecom and edge applications, while supporting rapid growth by investing i n capacity expansion and technology Fan Wall Coolant Distribution Unit (CDU) Immersion Cooling Chiller CRAC/ CRAH BMS/ Controls Edge and Telecom Products and Solutions Key End Markets Hyperscale Data Centers Colocation & Neocloud Data Centers
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A Complete Data Center Solution Provider 15 • We create, deliver, monitor and maintain data center cooling systems for hyperscale, colocation and neocloud customers globally • Our tailored systems solution includes controls to monitor and optimize performance to reduce energy consumption and lower the total cost of ownership • The market for data center cooling products continues to grow with demand for AI infrastructure and other high-performance compute applications that require chip-level liquid cooling along with chillers and air handling units to expel heat from the hall Our Right to Win in Global Data Centers CRAC / CRAH ChillersFan Walls CDUsControls Liquid Immersion Air Handling Units Positioned to Provide Hybrid Air/Liquid-Cooled Solutions to the High-Performance Compute Data Center Dry Cooler High Density Data Center
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Leveraging Technology in Data Centers 16 Driving Significant Growth in Attractive Data Center End Markets Key Strategic Objectives Key Market Drivers Leverage industry expertise to expand product portfolio, capacity and geographic reach to meet the data center cooling needs of new and existing customers today and in the future Provide the most efficient data center cooling products optimized with controls to reduce total cost of ownership and help customers meet sustainability targets Expand reach to edge, telecom and enterprise applications by offering full portfolio of solutions including a scalable modular approach to data center cooling • Exponential computing power needs from high-density computing applications drives need for new technologies to meet increased data center cooling demands • Desire to reduce data center operating costs and meet sustainability targets fuels demand for energy and water- efficient thermal solutions • Scarce energy resources and higher demand are increasing lead times and stretching market capacity
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Modine Services in Data Centers 17 Driving Significant Growth in Service Revenue, Engineers, Global Service Network Life Cycle Services • Preventative Maintenance Plans: Designed to ensure system resilience and extend equipment lifespan • Life Cycle System Optimization to maximize Energy efficiency • 24/7 Emergency Support: Includes a helpline and guaranteed response times from qualified engineers • Onsite and Localized replacement spare parts • Legislation compliance Data Center Delivery • Offsite acceptance testing of the full cooling and monitoring solution – certifying speed of onsite delivery • Project management from design to data center completion – aiding success • Commissioning Management from L1 – L6 ensuring delivery • Highly skilled engineers – to certify product and system quality Technology & Innovation • ACISTM building (BMS) & power systems (PMS) allows full monitoring and facilities management of the data center – the collection of good data sets is paramount to the training of AI models in the future • Cooling AITM models trained for data hall optimization utilizing machine learning and neural networks System Design • 50 years of cooling Product and System design • Intelligent cooling systems design for high-density environments • Managed and Controlled as a single cooling operation to maximize resiliency and efficiency via the Cooling System OptimizerTM • Virtual Technologies – Data hall and System CFD, temperature mapping & coordination
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1.4 1.2 0.7 1.2 2023 2024 2025 Q2 2026 Leverage Ratio Financial Trends $2,298 $2,408 $2,583 12% 5% 7% 2023 2024 2025 2026 Revenue and YOY % Growth $57 $127 $129 2.5% 5.3% 5.0% 2023 2024 2025 2026 Free Cash Flow (% of Net Sales) $212 $314 $392 9.2% 13.1% 15.2% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% $0 $100 $200 $300 $400 $500 2023 2024 2025 2026 Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA Adjusted EBITDA Margin Sales Outlook: +15% to +20% Adjusted EBITDA Outlook: $440M to $470M (In millions) Fiscal 2026 guidance is based on our October 2025 guidance ranges. See appendix for Non-GAAP reconciliations. FCF Outlook: +2.5% to +3% • Rate of earnings growth has outpaced revenue growth, resulting from 80/20 driven mix shift • Strong record of financial performance with 600 bps improvement in adjusted EBITDA margin from FY2023 to FY2025 • Current year outlook indicates another record year of revenue and adjusted EBITDA • Free cash flow drives strong balance sheet with ample liquidity for organic and inorganic investment • Expect lower free cash flow in FY26 due to investment in data center capacity expansion 18
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Exceeding Our Goals and Building Trust in Management 19 Exceeded Financial Targets and More Than Doubled Adjusted EBITDA Since 2022 Investor Day Revenue 6 - 8% CAGR Adjusted EBITDA Margin 10 - 12% FCF % of Sales 3 - 5% Previous Financial Targets for FY22 – FY24 (Announced at 2022 Investor Day) Actual Financial Results $159M $212M $314M $392M FY22 FY23 FY24 FY25 More Than Doubled Adjusted EBITDA FY22-FY25 8.4% CAGR 13.1% 5.3% FY24 FY25 7.3% YOY 15.2% 5.0% +35% CAGR See appendix for Non-GAAP reconciliations.
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Increasing Free Cash Flow Conversion 20 Higher Free Cash Flow Conversion From Significant Margin Improvement and Disciplined Capital Spending 5.3% FY24 FY27 FY25-27 Drivers 9-11% ~3% ~$15M Operating cash flow margin Capex spending Anticipate cash restructuring per year of sales ~6% - 8% Free Cash Flow as % of Sales Free Cash Flow Drivers • Targeted capital allocation is accelerating revenue growth, including $100M of incremental capex for data center capacity expansion in FY26 • Revenue growth and positive mix shift driving a higher cash flow margin • Restructuring to improve cost structure and align manufacturing footprint • Strong cash flow and the positive impact on net debt, provides significant capacity for acquisitions See appendix for the full GAAP income statement and Non-GAAP reconciliations
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Capital Allocation Priorities 21 Well-positioned to Support Future Acquisitions and Investments in Organic Growth 1 Investment in Organic Growth • Allocate capital to growth businesses • Target capital spending of 3% to 6% of sales 2 Restructuring • ~$15M cash spend annually through FY27 • Fully funded through ongoing operations, no external financing needed 3 Strategic Acquisitions • Adequate balance sheet flexibility to execute strategic M&A 4 Share Repurchase • Evaluate additional repurchases based on cash flow, macro climate, and other cash needs Acquisition & Divestiture Targets - FY25-FY27 • Acquired Revenue – $200M - $400M • One year accretive for margin & earnings • Business Exits/Divestitures – ~$250M • Target leverage – 1.0x - 2.5x Maximum Leverage: Flexible debt covenants support post-acquisition leverage of 3.00-3.50x, would plan to de-leverage to the target range within the first year.
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Well-Positioned for Success Delivering end-market diversification for business resiliency through economic cycles Providing strategic flexibility through strong free cash flow and balance sheet Furthering focus on organic and inorganic investment to achieve revenue and EBITDA growth Leveraging 80/20 to deliver growth and improve business mix through operational and commercial excellence Allocating capital to optimize the business portfolio to achieve long-term financial goals and compound shareholder value 22 80/20 Maturity Supporting Our Financial Targets, Resulting in 20% to 25% Annual Earnings Growth Fiscal 2027 Financial Targets 10% ‒ 13% Revenue Growth 16% ‒ 18% Adjusted EBITDA Margin 80 20 *See appendix for information on forward-looking non-GAAP financial measures FY24-FY27 CAGR
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Appendix
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Key End Markets Heavy-Duty Equipment Overview 24 Heat Exchangers • Provider of specialized solutions to meet the unique demands of heavy -duty agricultural, construction, and mining equipment and stationary power generation customers • Leveraging 80/20 strategies will continue to enable: - Compelling growth in the stationary power generation market as thermal modules transition to aluminum, providing greater perf ormance and efficiency - Margin improvement in agricultural, construction, and mining markets Custom Designed Cooling Modules Agricultural Equipment Stationary Power Generation Construction Equipment Mining Equipment Products and Solutions
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On-Highway Applications Overview 25 • Provider of heat exchangers that provide optimal thermal management for engines and powertrains focused on lowering carbon em issions and improving efficiency • Strategic relationships with global manufacturers that leverage thermal expertise and global footprint to deliver high -quality, cost-effective thermal solutions • Rationalize portfolio through product line simplification and exit of non-strategic business while targeting growth in strategic product lines for improved profitability Products and Solutions Key End Markets Automotive Commercial Vehicle Specialty Vehicle Custom Designed Cooling Modules Liquid Charge- Air Coolers Battery Thermal Management Systems Electronic Cooling Packages EGR Coolers Truck and Last Mile Delivery Transit and Coach Bus
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• World’s largest independent manufacturer of heat transfer coils, used in a variety of applications and markets • Provider of commercial refrigeration coolers leveraging low-GWP natural refrigerants • Market leader in anti-corrosion coating products and application services to OEMs and distributors • Aim to reposition the portfolio by increasing the focus on higher-margin products and systems while optimizing the margin on low er-margin component sales by applying 80/20 principles Heat Transfer Solutions Overview 26 OE & Aftermarket Coils Performance Coatings Commercial Refrigeration Heat PumpsData Center Cooling Commercial and Residential HVACRefrigeration Coolers Products and Solutions Key End Markets
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HVAC Technologies Overview 27 • North America’s leading unit heater manufacturer, used in greenhouse, garage and various other end -use applications with strong brand recognition, established sales channels, and expansive product offering which was recently expanded through acquisitions of AbsolutAire and L.B. White • Provider of indoor air quality products to the K-12 education market and other commercial applications, including healthcare and pharma • Aim to maintain leading market share position with applications in defensible, niche markets, while accelerating growth organ ically through new product development, and inorganically through strategic acquisitions Commercial & Residential Unit Heaters Vertical & Horizontal Unit Ventilators Products and Solutions Key End Markets Commercial Heating Indoor Air Quality - Schools Residential Heating Commercial IAQ Custom Air Handlers
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Data Centers Overview 28 • Provider of full system solutions for data center cooling with a suite of products designed to deliver flexible solutions and superior service to global colocation operators and hyperscale customers • Centralized smart building management systems that remotely monitor performance and energy consumption • Aim to leverage the Airedale brand to expand into telecom and edge applications, while supporting rapid growth by investing i n capacity and technology Fan Wall Coolant Distribution Unit (CDU) Immersion Cooling Chiller CRAC/ CRAH BMS/ Controls Edge and Telecom Products and Solutions Key End Markets Hyperscale Data Centers Colocation & Neocloud Data Centers
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Modine Revenue Breakdown FY2025 29 Revenue by End MarketRevenue by Geography Heating 6% Indoor Air Quality 4% Coolers 6% Coils HVAC&R 13% Coatings 2% Data Centers 25% Heavy-Duty 16% Commercial Vehicle 16% Light Vehicle 11% Other 1% Climate Solutions 56% Performance Technologies 44%Americas 65% EMEA 27% Asia 8%
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Performance Technologies Re-segmentation Effective FY26 30 PREVIOUS PRODUCT GROUPS AIR-COOLED APPLICATIONS LIQUID-COOLED APPLICATIONS ADVANCED SOLUTIONS $609M FY25 Sales $405M FY25 Sales $129M FY25 Sales • AC - Automotive • AC - Commercial Vehicle • AC - Off-Highway • AC - GenSets • LC - Automotive • LC - Commercial Vehicle • LC - Off-Highway • EV Systems • EV Automotive • Specialty Vehicle Systems NEW PROODUCT GROUPS HEAVY-DUTY EQUIPMENT ON-HIGHWAY APPLICATIONS $422M FY25 Sales $721M FY25 Sales • Off-Highway • GenSets • Automotive (ICE and EV) • Commercial Vehicle • Specialty Vehicle Systems (ICE) • EV Systems (Specialty and Commercial Vehicles)
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Climate Solutions Re-segmentation Effective FY26 31 PREVIOUS PRODUCT GROUPS HEAT TRANSFER PRODUCTS HVAC&R DATA CENTERS $403M FY25 Sales $394M FY25 Sales $644M FY25 Sales • OE and Aftermarket Coils • Anti-Corrosive Coatings • Heating Products • Refrigeration Coolers • School IAQ • Commercial IAQ • Data Center Cooling Products • Edge & Telecom NEW PRODUCT GROUPS HEAT TRANSFER SOLUTIONS HVAC TECHNOLOGIES DATA CENTERS $539M FY25 Sales $257M FY25 Sales $644M FY25 Sales • OE and Aftermarket Coils • Refrigeration Coolers • Anti-Corrosive Coatings • Heating Products • School IAQ • Commercial IAQ • Data Center Cooling Products • Edge & Telecom
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Modine Manufacturing Company Re-segmentation of Segment Product Groups Revenue (unaudited) (In millions) Climate Solutions product groups: Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 FY 2025 FY 2024 HVAC Technologies 50.0$ 69.5$ 72.5$ 65.0$ 257.0$ 207.5$ Heat Transfer Solutions 144.6 138.0 121.3 135.5 539.4 606.4 Data Centers 162.6 158.9 166.9 155.8 644.2 294.2 External sales 357.2$ 366.4$ 360.7$ 356.3$ 1,440.6$ 1,108.1$ Performance Technologies product groups: Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 FY 2025 FY 2024 Heavy-Duty Equipment 110.5$ 102.5$ 95.5$ 113.6$ 422.1$ 463.3$ On-Highway Applications 193.8 189.1 160.6 177.3 720.8 836.4 External sales 304.3$ 291.6$ 256.1$ 290.9$ 1,142.9$ 1,299.7$ Three months ended Revenue Re-segmentation Effective FY26 32
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Non-GAAP Reconciliations 33* See next slide for footnotes regarding these adjustments Modine Manufacturing Company Adjusted EBITDA (In millions) 2025 2024 2023 2022 Net earnings 185.5$ 163.4$ 153.6$ 86.3$ Interest expense 26.4 24.1 20.7 15.6 Provision (benefit) from income taxes 68.5 51.2 (28.3) 15.2 Depreciation and amortization expense 77.7 56.1 54.5 54.8 Other expense - net 3.1 2.0 4.4 2.1 Restructuring expenses (a) 28.2 15.0 5.0 24.1 Impairment charges (reversals) - net (b) - - - (55.7) (Gain) loss on sale of assets (c) - (4.0) - 6.6 Acquisition and integration costs (d) 2.3 4.1 - - Environmental charges (e) 0.4 2.4 2.2 3.8 Strategic reorganization costs (f) - - - 3.4 Automotive separation and exit strategy costs (g) - - - 2.6 Adjusted EBITDA 392.1$ 314.3$ 212.1$ 158.8$ Net Sales 2,583.5$ 2,407.8$ 2,297.9$ 2,050.1$ Adjusted EBITDA margin 15.2% 13.1% 9.2% 7.7% Twelve months ended March 31,
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Non-GAAP Reconciliations 34 (f) Strategic reorganization costs, recorded as SG&A expenses at Corporate, primarily consist of severance-related expenses and professional service fees for recruiting key senior management positions and the Company’s implementation of 80/20. The fiscal 2022 costs include recruiting fees for new segment vice presidents and business unit general managers and severance-related expenses for the outgoing executives as part of the transition. (g) Automotive separation and exit strategy costs consist of costs directly associated with the Company's review of strategic alternatives for its automotive businesses, including costs to prepare the businesses for sale. These costs were recorded at Corporate and are primarily related to accounting, legal, and IT professional services. (a) Restructuring expenses primarily consist of employee severance expenses related to targeted headcount reductions and plant consolidation activities and equipment transfer costs. (e) Environmental charges, including related legal costs, are recorded as SG&A expenses and relate to previously-owned U.S. manufacturing facilities. (b) The net impairment reversal during fiscal 2022 primarily relates to the Company's liquid-cooled automotive business. In connection with the termination of an agreement to sell the business, the Company remeasured its previously impaired long-lived assets to the lower of (i) carrying value, had held for sale classification never been met, or (ii) fair value. As a result, the Company recorded a net impairment reversal of $56.0 million during fiscal 2022. (d) Acquisition and integration costs primarily relate to the Company’s acquisition of Scott Springfield Manufacturing, a leading provider of air handling units for the data center, telecommunications, healthcare, and aerospace markets, on March 1, 2024. The acquisition and integration costs primarily include fees for i) transaction advisors, ii) legal, accounting, and other professional services, and iii) incremental costs directly associated with integration activities. The adjustments in both fiscal 2024 and 2025 also included $1.6 million recorded at Corporate for the impact of an inventory purchase accounting adjustment. The Company wrote up acquired inventory to its estimated fair value and charged the write-up to cost of sales as the underlying inventory was sold. (c) The Company sold three automotive businesses based in Germany during fiscal 2024 and, as a result, recorded a $4.0 million gain on sale. During fiscal 2022, the Company sold its Austrian air-cooled automotive business and recorded a $6.6 million loss on sale as a result.
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Non-GAAP Reconciliations 35* See next slide for footnotes regarding these adjustments Modine Manufacturing Company Segment adjusted financial results (unaudited) (In millions) Climate Solutions Performance Technologies Corporate and eliminations Total Climate Solutions Performance Technologies Corporate and eliminations Total Operating income 248.4$ 108.0$ (72.9)$ 283.5$ 81.0$ 69.8$ (31.6)$ 119.2$ Depreciation and amortization expense 48.3 28.7 0.7 77.7 26.5 27.1 1.2 54.8 Restructuring expenses (a) 6.0 20.5 1.7 28.2 2.6 21.5 - 24.1 Impairment charges (reversals) – net (b) - - - - 0.3 (56.0) - (55.7) Loss on sale of assets (c) - - - - - - 6.6 6.6 Strategic reorganization and automotive exit costs (d) - - - - - - 6.0 6.0 Environmental charges (e) - - 0.4 0.4 - - 3.8 3.8 Acquisition and integration costs (f) - - 2.3 2.3 - - - - Adjusted EBITDA 302.7$ 157.2$ (67.8)$ 392.1$ 110.4$ 62.4$ (14.0)$ 158.8$ Net sales 1,440.8$ 1,163.5$ (20.8)$ 2,583.5$ 954.6$ 1,124.5$ (29.0)$ 2,050.1$ Adjusted EBITDA margin 21.0% 13.5% 15.2% 11.6% 5.5% 7.7% Twelve months ended March 31, 2025 Twelve months ended March 31, 2022
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Non-GAAP Reconciliations 36 (f) Acquisition and integration costs primarily relate to the Company’s acquisition of Scott Springfield Manufacturing, a leading provider of air handling units for the data center, telecommunications, healthcare, and aerospace markets, on March 1, 2024. The acquisition and integration costs primarily include fees for i) transaction advisors, ii) legal, accounting, and other professional services, and iii) incremental costs directly associated with integration activities. The adjustments also included $1.6 million recorded at Corporate for the impact of an inventory purchase accounting adjustment. The Company wrote up acquired inventory to its estimated fair value and charged the write-up to cost of sales as the underlying inventory was sold. (a) Restructuring expenses primarily consist of employee severance expenses related to targeted headcount reductions and plant consolidation activities and equipment transfer costs. (b) The net impairment reversal during fiscal 2022 primarily relates to the Company's liquid-cooled automotive business. In connection with the termination of the agreement to sell this business in the third quarter of fiscal 2022, the Company reversed a significant amount of previously-recorded impairment charges within the Performance Technologies segment. (c) The Company sold its air-cooled automotive business in Austria in April 2021. As a result of the sale, the Company recorded a $6.6 million loss on sale at Corporate. (d) The fiscal 2022 amounts include costs recorded at Corporate associated with the Company’s strategic reorganization and automotive exit strategy. During fiscal 2022, the Company recorded SG&A expenses totaling $3.4 million related to recruiting new senior management and the Company’s implementation of 80/20. In addition, the Company recorded $2.6 million of costs associated with its review of strategic alternatives for its automotive businesses, including costs to prepare the businesses for sale. (e) Environmental charges, including related legal costs, are recorded as SG&A expenses and relate to a previously-owned U.S. manufacturing facility.
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Non-GAAP Reconciliations 37 Free cash flow (In millions) 2025 2024 2023 Net cash provided by operating activities 213.3$ 214.6$ 107.5$ Expenditures for property, plant and equipment (84.0) (87.7) (50.7) Free cash flow 129.3$ 126.9$ 56.8$ Net Sales 2,583.5$ 2,407.8$ 2,297.9$ FCF % of Net Sales 5.0% 5.3% 2.5% Twelve months ended March 31,
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Forward-Looking Non-GAAP Financial Measures 38 This presentation includes forward-looking projections of non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA margin, and free cash flow. The projections are based on management’s expectations of future financial results. For example, the Company’s fiscal 2026 guidance includes adjusted EBITDA, which is a non-GAAP financial measure. The full-year fiscal 2026 guidance includes the Company’s estimates for interest expense of approximately $31 to $35 million, a provision for income taxes of approximately $81 to $87 million, and depreciation and amortization expense of approximately $79 to $83 million. The non-GAAP financial measure also excludes certain cash and non-cash expenses or gains. These expenses and gains may be significant and include items such as restructuring expenses (including severance and equipment transfer costs), acquisition and integration costs, impairment charges and certain other items. In connection with the pending termination of its U.S. pension plan, the Company expects to record non-cash pension settlement charges totaling approximately $120 million to $125 million during the second half of fiscal 2026. Estimates of other expenses and gains for the remainder of fiscal 2026 that will be excluded for the non-GAAP financial measure are not available due to the low visibility and unpredictability of these items.