Racine-based Modine Manufacturing Co. reported a nearly 80 percent drop in net income driven by restructuring, acquisition and integration costs.
The maker of thermal management systems reported net income of $1.7 million during the third quarter of fiscal 2017, a 79.3 percent drop. Earnings declined from 17 cents to 4 cents per diluted share.
The company reported $349.8 million in revenue, a 6.4 percent increase that benefited from $34.7 million in sales from the newly acquired Luvata HTS. Absent that gain, net sales were down 4.1 percent.
“While we are experiencing some additional headwinds with market volumes and metals, I am pleased that we have already corrected a majority of the operational issues identified during the second quarter and continue to drive significant improvements during the fourth quarter,” said Thomas Burke, Modine president and chief executive officer.
Modine’s Americas segment reported a 10 percent drop in revenue to $123.4 million, which was attributed to ongoing weakness in commercial vehicle and off-highway markets. Similar trends led the Europe segment to be down 5 percent to $119.8 million.
The Building HVAC segment reported a 7.2 percent drop in revenue to $47.2 million, which was attributed to lower sales of heating and ventilation products in North America, partially offset by higher air conditioning sales in the United Kingdom.
The bright spot for the company was a 52.9 percent increase in revenue in Asia to $28.6 million, which has attributed higher automotive and off-highway sales.
Modine lowered its full-year outlook, expecting lower volumes in the Americas and Building HVAC segments and a temporary impact from higher metals costs and exchange rates. The full-year forecast calls for revenue to be up 9 to 11 percent, including a 1 to 3 percent drop in the base business and $160 million of revenue from Luvata, which is in the newly formed CIS segment.
