Racine-based Modine Manufacturing Co. now expects to exceed $15 million in cost synergies from its acquisition of Luvata HTS and to do so ahead of schedule, Thomas Burke, Modine president and chief executive officer, said during the company’s first quarter earnings call.
Modine acquired Luvata last year for $422 million as part of an effort diversify the company’s business and reduce its exposure to cyclical markets.
Burke said Wednesday the company’s cost saving efforts following the acquisition will be completed ahead of the three- to four-year timeline that was originally expected. He said the business, now referred to as commercial and industrial solutions, is performing within expectations.
“Our focus this year is on absorbing the corporate functions that were not acquired with the business, aligning and combining the coils organization in North America and conducting a complete assessment of our manufacturing operations,” Burke said.
Modine reported revenue of $515.5 million during the quarter, a 48 percent increase over last year, including $157.5 million from the acquisition.
Sales were up 15 percent after excluding the revenue boost from the acquisition.
Net income increased from $8.6 million to $17 million and earnings improved from 18 to 34 cents per diluted share.
“We are encouraged by signs of growth in the global off-highway markets, which contributed to our strong quarterly results,” Burke said. “It is clear that the strategic actions taken over the past several years to strengthen, diversify and grow have fortified our business model and significantly contributed to Modine’s strong financial performance during the quarter.”