MODINE MANUFACTURING CO 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. MODINE MANUFACTURING COMPANY CONSOLIDATED STATEMENTS OF OPERATIONS For the years ended March 31, 2026, 2025 and 2024 (In millions, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Net sales ​ $ 3,181.1 ​ $ 2,583.5 ​ $ 2,407.8 Cost of sales ​ 2,450.0 ​ 1,939.7 ​ 1,882.2 Gross profit ​ 731.1 ​ 643.8 ​ 525.6 Selling, general and administrative expenses ​ 360.1 ​ 332.1 ​ 273.9 Restructuring expenses ​ 20.6 ​ 28.2 ​ 15.0 Impairment charge ​ 4.1 ​ — ​ — Loss (gain) on sale of assets ​ 3.9 ​ — ​ ( 4.0 ) Operating income ​ 342.4 ​ 283.5 ​ 240.7 Interest expense ​ ( 31.6 ) ​ ( 26.4 ) ​ ( 24.1 ) Pension termination charge ​ ​ ( 116.1 ) ​ ​ — ​ ​ — Other expense – net ​ ( 8.2 ) ​ ( 3.1 ) ​ ( 2.0 ) Earnings before income taxes ​ 186.5 ​ 254.0 ​ 214.6 Provision for income taxes ​ ( 63.2 ) ​ ( 68.5 ) ​ ( 51.2 ) Net earnings ​ 123.3 ​ 185.5 ​ 163.4 Net earnings attributable to noncontrolling interest ​ ( 1.8 ) ​ ( 1.5 ) ​ ( 1.9 ) Net earnings attributable to Modine ​ $ 121.5 ​ $ 184.0 ​ $ 161.5 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net earnings per share attributable to Modine shareholders: ​ ​ ​ ​ ​ ​ Basic ​ $ 2.30 ​ $ 3.50 ​ $ 3.08 Diluted ​ $ 2.26 ​ $ 3.42 ​ $ 3.03 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average shares outstanding: ​ ​ ​ ​ ​ ​ Basic ​ 52.8 ​ 52.6 ​ 52.4 Diluted ​ 53.8 ​ 53.9 ​ 53.4 ​ The notes to consolidated financial statements are an integral part of these statements. ​ ​ ​ 51 Table of Contents MODINE MANUFACTURING COMPANY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME For the years ended March 31, 2026, 2025 and 2024 (In millions) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Net earnings ​ $ 123.3 ​ $ 185.5 ​ $ 163.4 Other comprehensive income (loss), net of income taxes: ​ ​ ​ ​ ​ ​ Foreign currency translation ​ 36.1 ​ ( 14.3 ) ​ ( 5.6 ) Defined benefit plans ​ 107.6 ​ ( 3.1 ) ​ 3.7 Cash flow hedges ​ 0.8 ​ ( 0.8 ) ​ ( 0.7 ) Total other comprehensive income (loss) ​ 144.5 ​ ( 18.2 ) ​ ( 2.6 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income ​ 267.8 ​ 167.3 ​ 160.8 Comprehensive income attributable to noncontrolling interest ​ ( 2.1 ) ​ ( 1.2 ) ​ ( 1.6 ) Comprehensive income attributable to Modine ​ $ 265.7 ​ $ 166.1 ​ $ 159.2 ​ The notes to consolidated financial statements are an integral part of these statements. ​ ​ ​ 52 Table of Contents MODINE MANUFACTURING COMPANY CONSOLIDATED BALANCE SHEETS March 31, 2026 and 2025 (In millions, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ASSETS ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 73.5 ​ $ 71.6 Trade accounts receivable – net ​ 731.0 ​ 478.9 Inventories ​ 506.1 ​ 340.9 Other current assets ​ 105.5 ​ 69.8 Total current assets ​ 1,416.1 ​ 961.2 Property, plant and equipment – net ​ 520.9 ​ 390.5 Intangible assets – net ​ 197.0 ​ 146.7 Goodwill ​ 292.1 ​ 233.9 Deferred income taxes ​ 85.3 ​ 67.0 Other noncurrent assets ​ 163.2 ​ 118.3 Total assets ​ $ 2,674.6 ​ $ 1,917.6 ​ ​ ​ ​ ​ ​ ​ LIABILITIES AND SHAREHOLDERS’ EQUITY ​ ​ ​ ​ Short-term debt ​ $ 7.5 ​ $ 9.3 Long-term debt – current portion ​ 43.9 ​ 44.8 Accounts payable ​ 464.8 ​ 290.8 Accrued compensation and employee benefits ​ 95.1 ​ 102.7 Other current liabilities ​ 117.6 ​ 93.4 Total current liabilities ​ 728.9 ​ 541.0 Long-term debt ​ 384.9 ​ 296.7 Deferred income taxes ​ 25.6 ​ 24.1 Pensions ​ 11.4 ​ 29.4 Other noncurrent liabilities ​ 321.0 ​ 108.2 Total liabilities ​ 1,471.8 ​ 999.4 Commitments and contingencies (see Note 20) ​ ​ ​ ​ Shareholders’ equity: ​ ​ ​ ​ Preferred stock, $ 0.025 par value, authorized 16.0 million shares, issued – none ​ — ​ — Common stock, $ 0.625 par value, authorized 80.0 million shares, issued 57.0 million and 56.5 million shares ​ 35.6 ​ 35.3 Additional paid-in capital ​ 336.1 ​ 310.8 Retained earnings ​ 964.5 ​ 843.0 Accumulated other comprehensive loss ​ ( 37.1 ) ​ ( 181.3 ) Treasury stock, at cost, 4.2 million and 4.1 million shares ​ ( 104.6 ) ​ ( 97.6 ) Total Modine shareholders’ equity ​ 1,194.5 ​ 910.2 Noncontrolling interest ​ 8.3 ​ 8.0 Total equity ​ 1,202.8 ​ 918.2 Total liabilities and equity ​ $ 2,674.6 ​ $ 1,917.6 ​ The notes to consolidated financial statements are an integral part of these statements. ​ ​ 53 Table of Contents MODINE MANUFACTURING COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended March 31, 2026, 2025 and 2024 (In millions) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Cash flows from operating activities: ​ ​ ​ ​ ​ ​ Net earnings ​ $ 123.3 ​ $ 185.5 ​ $ 163.4 Adjustments to reconcile net earnings to net cash provided by operating activities: ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 79.7 ​ 77.7 ​ 56.1 Impairment charge ​ 4.1 ​ — ​ — Loss (gain) on sale of assets ​ 3.9 ​ — ​ ( 4.0 ) Pension termination charge ​ ​ 116.1 ​ ​ — ​ ​ — Stock-based compensation expense ​ 22.1 ​ 26.4 ​ 10.8 Deferred income taxes ​ ( 39.1 ) ​ 6.5 ​ 6.2 Other – net ​ 7.0 ​ 6.9 ​ 6.1 Changes in operating assets and liabilities: ​ ​ ​ ​ ​ ​ Trade accounts receivable ​ ( 222.6 ) ​ ( 61.2 ) ​ ( 8.3 ) Inventories ​ ( 125.1 ) ​ 13.6 ​ ( 17.3 ) Accounts payable ​ 151.1 ​ 10.5 ​ ( 59.1 ) Accrued compensation and employee benefits ​ ( 13.5 ) ​ 1.6 ​ 15.2 Contract liabilities ​ ​ 159.0 ​ ​ ( 44.5 ) ​ ​ 58.3 Other assets ​ ( 2.9 ) ​ 15.3 ​ 12.0 Other liabilities ​ ( 14.4 ) ​ ( 25.0 ) ​ ( 24.8 ) Net cash provided by operating activities ​ 248.7 ​ 213.3 ​ 214.6 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows from investing activities: ​ ​ ​ ​ ​ ​ Expenditures for property, plant and equipment ​ ( 143.3 ) ​ ( 84.0 ) ​ ( 87.7 ) Payments for business acquisitions, net of cash acquired ​ ( 182.4 ) ​ ( 3.4 ) ​ ( 186.2 ) Purchase of technology and related assets (see Note 2) ​ — ​ — ​ ( 12.0 ) Proceeds from (payments for) disposition of assets ​ 0.8 ​ 0.8 ​ ( 0.8 ) Other – net ​ 3.6 ​ — ​ 3.3 Net cash used for investing activities ​ ( 321.3 ) ​ ( 86.6 ) ​ ( 283.4 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash flows from financing activities: ​ ​ ​ ​ ​ ​ Borrowings of debt ​ 829.6 ​ 414.5 ​ 332.5 Repayments of debt ​ ( 745.9 ) ​ ( 496.3 ) ​ ( 260.4 ) (Repayments) borrowings on bank overdrafts – net ​ ( 5.0 ) ​ ( 0.7 ) ​ 6.3 Purchases of treasury stock ​ ( 7.0 ) ​ ( 30.9 ) ​ ( 17.7 ) Dividends paid to noncontrolling interest ​ ( 1.8 ) ​ ( 1.1 ) ​ ( 0.5 ) Other – net ​ 3.2 ​ 0.9 ​ 2.5 Net cash provided by (used for) financing activities ​ 73.1 ​ ( 113.6 ) ​ 62.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of exchange rate changes on cash ​ 1.3 ​ ( 1.5 ) ​ ( 0.8 ) Net increase (decrease) in cash, cash equivalents and restricted cash ​ 1.8 ​ 11.6 ​ ( 6.9 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash, cash equivalents and restricted cash – beginning of period ​ 71.9 ​ 60.3 ​ 67.2 Cash, cash equivalents and restricted cash – end of period ​ $ 73.7 ​ $ 71.9 ​ $ 60.3 ​ The notes to consolidated financial statements are an integral part of these statements. ​ 54 Table of Contents MODINE MANUFACTURING COMPANY CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY For the years ended March 31, 2026, 2025 and 2024 (In millions) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ other ​ Treasury ​ Non- ​ ​ ​ ​ ​ Common stock ​ ​ ​ ​ paid-in ​ Retained ​ comprehensive ​ stock, at ​ controlling ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ Amount ​ ​ ​ capital ​ ​ ​ earnings ​ ​ ​ loss ​ ​ ​ cost ​ ​ ​ interest ​ ​ ​ Total Balance, March 31, 2023 55.4 ​ $ 34.6 ​ $ 270.8 ​ $ 497.5 ​ $ ( 161.1 ) ​ $ ( 49.0 ) ​ $ 6.8 ​ $ 599.6 Net earnings — ​ — ​ — ​ 161.5 ​ — ​ — ​ 1.9 ​ 163.4 Other comprehensive loss — ​ — ​ — ​ — ​ ( 2.3 ) ​ — ​ ( 0.3 ) ​ ( 2.6 ) Stock options and awards 0.7 ​ 0.4 ​ 2.1 ​ — ​ — ​ — ​ — ​ 2.5 Purchases of treasury stock — ​ — ​ — ​ — ​ — ​ ( 17.7 ) ​ — ​ ( 17.7 ) Stock-based compensation expense — ​ — ​ 10.8 ​ — ​ — ​ — ​ — ​ 10.8 Dividend paid to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 0.5 ) ​ ( 0.5 ) Balance, March 31, 2024 56.1 ​ 35.0 ​ 283.7 ​ 659.0 ​ ( 163.4 ) ​ ( 66.7 ) ​ 7.9 ​ 755.5 Net earnings — ​ — ​ — ​ 184.0 ​ — ​ — ​ 1.5 ​ 185.5 Other comprehensive loss — ​ — ​ — ​ — ​ ( 17.9 ) ​ — ​ ( 0.3 ) ​ ( 18.2 ) Stock options and awards 0.4 ​ 0.3 ​ 0.7 ​ — ​ — ​ — ​ — ​ 1.0 Purchases of treasury stock — ​ — ​ — ​ — ​ — ​ ( 30.9 ) ​ — ​ ( 30.9 ) Stock-based compensation expense — ​ — ​ 26.4 ​ — ​ — ​ — ​ — ​ 26.4 Dividend paid to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 1.1 ) ​ ( 1.1 ) Balance, March 31, 2025 56.5 ​ 35.3 ​ 310.8 ​ 843.0 ​ ( 181.3 ) ​ ( 97.6 ) ​ 8.0 ​ 918.2 Net earnings — ​ — ​ — ​ 121.5 ​ — ​ — ​ 1.8 ​ 123.3 Other comprehensive income — ​ — ​ — ​ — ​ 144.2 ​ — ​ 0.3 ​ 144.5 Stock options and awards 0.5 ​ 0.3 ​ 3.2 ​ — ​ — ​ — ​ — ​ 3.5 Purchases of treasury stock — ​ — ​ — ​ — ​ — ​ ( 7.0 ) ​ — ​ ( 7.0 ) Stock-based compensation expense — ​ — ​ 22.1 ​ — ​ — ​ — ​ — ​ 22.1 Dividends paid to noncontrolling interest — ​ — ​ — ​ — ​ — ​ — ​ ( 1.8 ) ​ ( 1.8 ) Balance, March 31, 2026 57.0 ​ $ 35.6 ​ $ 336.1 ​ $ 964.5 ​ $ ( 37.1 ) ​ $ ( 104.6 ) ​ $ 8.3 ​ $ 1,202.8 ​ The notes to consolidated financial statements are an integral part of these statements. ​ ​ ​ ​ 55 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 1: Significant Accounting Policies Nature of operations Modine Manufacturing Company (“Modine” or the “Company”) specializes in providing innovative and environmentally responsible thermal management products and solutions to diversified global markets and customers in a wide array of commercial, industrial, and building heating, ventilating, air conditioning, and refrigeration (“HVAC&R”) markets. In addition, the Company is a leading provider of engineered heat transfer systems and high-quality heat transfer components for use in on- and off-highway original equipment manufacturer (“OEM”) vehicular applications. The Company’s primary product groups include i) Data Centers; ii) Heat Transfer Solutions; iii) HVAC Technologies; iv) Heavy-Duty Equipment; and v) On-Highway Applications. Basis of presentation The Company prepares its consolidated financial statements in conformity with generally accepted accounting principles (“GAAP”) in the United States. These principles require management to make certain estimates and assumptions in determining assets, liabilities, revenue, expenses and related disclosures. Actual amounts could differ materially from those estimates. Consolidation principles The consolidated financial statements include the accounts of Modine Manufacturing Company and its majority-owned or Modine-controlled subsidiaries. The Company eliminates intercompany transactions and balances in consolidation. Revenue recognition The Company recognizes revenue based upon consideration specified in a contract and as it satisfies performance obligations by transferring control over its products to its customers, which may be at a point in time or over time. The majority of the Company’s revenue is recognized at a point in time, based upon shipment terms. See Note 3 for additional information. Shipping and handling costs The Company records shipping and handling costs incurred upon the shipment of products to its customers in cost of sales, and related amounts billed to these customers in net sales. Warranty The Company provides product warranties for specific product lines and accrues for estimated future warranty costs in the period in which the sale is recorded. The Company records warranty expense, within cost of sales, based upon historical and current claims data or based upon estimated future claims. Accrual balances, which are recorded within other current liabilities, are monitored and adjusted if it is probable that expected claims will differ from previous estimates. See Note 15 for additional information. Tooling The Company accounts for production tooling costs as a component of property, plant and equipment when it owns title to the tooling and amortizes the capitalized cost to cost of sales over the estimated life of the asset, which is generally three years . At March 31, 2026 and 2025, Company-owned tooling totaled $ 16.7 million and $ 18.2 million, respectively. In certain instances, tooling is owned by the customer. At the time customer-owned tooling is completed and customer acceptance is obtained, the Company records tooling revenue and related production costs within net sales and cost of sales, respectively, in the consolidated statements of operations. If the customer has agreed to reimburse the Company, unbilled customer-owned tooling costs are recorded as a receivable within other current assets. No significant arrangements exist where customer-owned tooling costs were not accompanied by guaranteed reimbursement. At March 31, 2026 and 2025, customer-owned tooling receivables totaled $ 2.6 million and $ 6.9 million, respectively. 56 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Stock-based compensation The Company recognizes stock-based compensation using the fair value method. Accordingly, compensation expense for restricted stock, stock options and performance-based stock awards is calculated based upon the fair value of the instruments at the time of grant and is recognized as expense over the respective vesting periods. See Note 5 for additional information. Research and development The Company expenses research and development costs as incurred within selling, general and administrative (“SG&A”) expenses. During fiscal 2026, 2025 and 2024, research and development costs totaled $ 29.3 million, $ 34.9 million, and $ 42.0 million, respectively. Translation of foreign currencies The Company translates assets and liabilities of foreign subsidiaries into U.S. dollars at the period-end exchange rates and translates income and expense items at the monthly average exchange rate for the period in which the transactions occur. The Company reports resulting translation adjustments within accumulated other comprehensive income (loss) within shareholders’ equity. The Company includes foreign currency transaction gains or losses in the statement of operations within other income and expense. Derivative instruments The Company enters into derivative financial instruments from time to time to manage certain financial risks. The Company enters into forward contracts to reduce exposure to changing future purchase prices for aluminum and copper and into foreign currency exchange contracts to hedge specific foreign currency-denominated assets and liabilities as well as forecasted transactions. The Company designates certain derivative financial instruments as cash flow hedges for accounting purposes. These instruments are used to manage financial risks and are not speculative. See Note 19 for additional information. Income taxes The Company determines deferred tax assets and liabilities based upon the difference between the amounts reported in the financial statements and the tax basis of assets and liabilities, using enacted tax rates in effect in the years in which the differences are expected to reverse. The Company establishes a valuation allowance if it is more likely than not that a deferred tax asset, or portion thereof, will not be realized. The Company records the tax effects of global intangible low-taxed income (“GILTI”) as a period expense in the applicable tax year. The Company uses the portfolio approach for releasing income tax effects from accumulated other comprehensive income (loss). See Note 8 for additional information. Earnings per share The Company calculates basic earnings per share based upon the weighted-average number of common shares outstanding during the period, while the calculation of diluted earnings per share includes the dilutive effect of potential common shares outstanding during the period. The calculation of diluted earnings per share excludes potential common shares if their inclusion would have an anti-dilutive effect. See Note 9 for additional information. Cash and cash equivalents The Company considers all highly-liquid investments with original maturities of three months or less to be cash equivalents. ​ ​ 57 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Trade accounts receivable The Company records trade receivables at the invoiced amount. Trade receivables typically do not bear interest if paid according to the original terms. The Company maintains an allowance for credit losses, representing its estimate of expected losses associated with its trade accounts receivable. The Company bases its estimate using historical loss experience and considers the aging of the receivables and risks specific to customers where appropriate. At March 31, 2026 and 2025, the allowance for credit losses was $ 3.5 million and $ 1.8 million, respectively. The changes to the Company’s allowance for credit losses during fiscal 2026 and 2025 were not material and primarily consisted of current-period provisions, write-offs charged against the allowance, recoveries collected, and foreign currency translation. The Company enters into supply chain financing programs from time to time to sell accounts receivable, without recourse, to third-party financial institutions. Sales of accounts receivable are reflected as a reduction of accounts receivable on the consolidated balance sheets and the proceeds are included in cash flows from operating activities in the consolidated statements of cash flows. During fiscal 2026, 2025 and 2024, the Company sold $ 2.2 million, $ 7.9 million, and $ 130.2 million, respectively, of accounts receivable to accelerate cash receipts. During fiscal 2024, the Company recorded costs totaling $ 1.6 million related to selling accounts receivable in the consolidated statements of operations. During fiscal 2026 and 2025, costs related to selling accounts receivable were not significant. Inventories The Company values inventories using a first-in, first-out or weighted-average basis, at the lower of cost and net realizable value. Property, plant and equipment The Company records property, plant and equipment at cost. For financial reporting purposes, the Company computes depreciation using the straight-line method over the expected useful lives of the assets. The Company expenses maintenance and repair costs as incurred. The Company capitalizes costs of improvements. Upon the sale or other disposition of an asset, the Company removes the cost and related accumulated depreciation from the accounts and includes the gain or loss in the consolidated statements of operations. Capital expenditures of $ 33.6 million, $ 22.4 million, and $ 22.7 million were accrued within accounts payable at March 31, 2026, 2025 and 2024, respectively. Leases The Company’s most significant leases represent leases of real estate, such as manufacturing facilities, warehouses, and office buildings. The Company also leases manufacturing and information technology equipment and vehicles. The Company recognizes right-of-use (“ROU”) assets and lease liabilities at the lease commencement date, based upon the present value of lease payments over the lease term. See Note 16 for additional information. Goodwill The Company does not amortize goodwill; rather, it tests for impairment annually unless conditions exist that would require a more frequent evaluation. The Company performs an assessment of the fair value of its reporting units for goodwill impairment testing based upon, among other things, the present value of expected future cash flows. The Company performed its goodwill impairment tests as of February 28, 2026 and determined the fair value of each of its reporting units exceeded the respective book value. See Note 14 for additional information. Impairment of long-lived assets The Company evaluates held and used long-lived assets, including property, plant and equipment and intangible assets, for impairment whenever conditions or events indicate that those assets may be impaired. The Company considers factors such as operating losses, declining financial outlooks and market conditions when evaluating the need for an impairment analysis. In the event an impairment indicator is identified, the Company compares the undiscounted future cash flows expected to be generated by the assets with their carrying value. If the net asset values exceed expected future cash flows, the Company writes down the assets to fair value and records an impairment charge. The Company estimates fair value in various ways depending on the nature of the underlying assets. Fair value is generally based upon appraised value, estimated salvage value, or selling prices under negotiation, as applicable. 58 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Assets held for sale The Company classifies an asset as held for sale when (i) management approves and commits to a formal plan to actively market the asset for sale at a reasonable price in relation to its fair value; (ii) the asset is available for immediate sale in its present condition; (iii) an active program to locate a buyer and other actions required to complete the sale have been initiated; (iv) the sale of the asset is expected to be completed within one year; and (v) it is unlikely that significant changes will be made to the plan. Upon classification as held for sale, the Company records the carrying value of the asset at the lower of its carrying value or its estimated fair value, less costs to sell. In addition, the Company ceases to record depreciation for assets held for sale. In fiscal 2026, the Company recorded a non-cash impairment charge of $ 4.1 million related to assets held for sale. See Note 2 for additional information. Deferred compensation trusts The Company maintains deferred compensation trusts to fund future obligations under its non-qualified deferred compensation plans. The trusts’ investments in third-party debt and equity securities are presented within other noncurrent assets in the consolidated balance sheets. The deferred compensation obligations are recorded within other noncurrent liabilities in the consolidated balance sheets. Self-insurance reserves The Company retains a portion of the financial risk for certain insurance coverage, including property, general liability, workers compensation, and employee healthcare, and therefore maintains reserves that estimate the impact of unreported and under-reported claims that fall below stop-loss limits and deductibles under its insurance policies. The Company maintains reserves for the estimated settlement cost of known claims, as well as estimates of incurred but not reported claims. The Company charges costs of claims, including the impact of changes in reserves due to claim experience and severity, to cost of sales or SG&A expenses. The Company reviews and updates the amount of its insurance-related reserves on a quarterly basis. Environmental liabilities The Company records liabilities for environmental assessments and remediation activities in the period in which its responsibility is probable and the costs can be reasonably estimated. The Company records environmental indemnification assets from third parties, including prior owners, when recovery is probable. To the extent that the required remediation procedures change, or additional contamination is identified, the Company’s estimated environmental liabilities may also change. See Note 20 for additional information. ​ Supplier finance programs The Company facilitates a voluntary supplier finance program through a financial institution that allows certain suppliers in the U.S. and Europe to request early payment for invoices, at a discount, from the financial institution. The Company or the financial institution may terminate the supplier finance program upon 90 days’ notice. The Company’s obligations to its suppliers, including amounts due and payment terms, are consistent, irrespective of whether a supplier participates in the program. The Company is not party to the arrangements between the participating suppliers and the financial institution. Under this program, the Company confirms the validity of supplier invoices to the financial institution and remits payments to it based on the original payment terms, which typically range from 60 to 120 days. The outstanding obligations under this program are included within accounts payable in the consolidated balance sheets. The following table presents a roll forward of the Company’s obligations associated with its supplier finance program. ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ 2026 ​ ​ ​ 2025 Obligations outstanding – beginning of period ​ ​ ​ $ 15.5 ​ $ 23.6 Invoices submitted ​ 115.6 ​ ​ ​ 102.2 Invoices paid ​ ( 109.5 ) ​ ( 110.3 ) Obligations outstanding – end of period ​ $ 21.6 ​ $ 15.5 ​ 59 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ New accounting guidance ​ Disaggregation of Income Statement Expenses In November 2024, the FASB issued new guidance that will require additional disclosure regarding the nature of expenses presented within expense captions on the consolidated statements of operations and selling expenses. The new disclosure requirements will become effective for the Company’s fiscal 2028 annual financial statements. The Company is currently evaluating the new disclosures, but does not expect the guidance will have a material impact on its consolidated financial statements. ​ Note 2: Acquisitions and Dispositions The Company accounts for acquired businesses using the acquisition method and records assets acquired and liabilities assumed at their respective fair values. The excess of the purchase price over the allocated amount is recorded as goodwill. Fiscal 2026 Acquisitions The Company acquired three businesses during fiscal 2026: AbsolutAire, Inc. (“AbsolutAire”), LBW Holding Corp. (“L.B. White”), and Climate by Design International (“Climate by Design”). Since the date of each acquisition, the Company has reported the financial results of these businesses within the Climate Solutions segment. During fiscal 2026, the operating results for the acquired companies were not material. The Company has not presented supplemental pro forma financial information for these acquisitions since they are not material, individually or in the aggregate, to the Company’s consolidated financial statements. ​ AbsolutAire On April 1, 2025, the Company acquired substantially all of the net operating assets of AbsolutAire for consideration totaling $ 11.3 million. AbsolutAire is a Michigan-based manufacturer of direct-fired heating, ventilation, and make-up air systems. This acquisition supports the Company’s growth strategy by expanding its heating and indoor air quality product portfolios and also broadens its customer base in the commercial, industrial, food service, and warehousing sectors. During fiscal 2026, the Company included net sales of $ 24.8 million within its consolidated statement of operations attributable to AbsolutAire. ​ The Company’s allocation of the purchase price for its acquisition of AbsolutAire was as follows: ​ ​ ​ ​ ​ Trade accounts receivable ​ $ 3.4 Inventories ​ 3.9 Property, plant and equipment ​ 2.8 Intangible assets ​ 2.2 Goodwill ​ 1.1 Accounts payable ​ ( 1.2 ) Accrued compensation and employee benefits ​ ( 0.4 ) Other liabilities ​ ( 0.5 ) Purchase price ​ $ 11.3 ​ 60 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company recorded $ 2.2 million of intangible assets, including customer relationship and trade name assets. The Company is amortizing the acquired intangible assets using a weighted-average life of approximately eleven years . The Company allocated the excess of the purchase price over the net assets recognized to goodwill in the amount of $ 1.1 million, which is expected to be deductible for income tax purposes. ​ L.B. White On May 31, 2025, the Company acquired all of the issued and outstanding shares of L.B. White for consideration totaling $ 110.5 million ($ 107.7 million net of cash acquired). The Company primarily utilized its revolving credit facility to fund the purchase price. Headquartered in Wisconsin, with additional manufacturing and distribution operations in Georgia, L.B. White is a leading provider of specialty heating solutions, including direct-fired forced air, radiant, indirect-fired, and electric heating solutions, for the agriculture, construction, and special event industries. L.B. White holds a leading position in the swine and poultry agricultural heating markets in North America and is a market leader in portables heating. This acquisition expands the Company’s product portfolio and also broadens its network into adjacent heating markets. During fiscal 2026, the Company included net sales of $ 63.8 million within its consolidated statement of operations attributable to L.B. White. The Company’s allocation of the purchase price for its acquisition of L.B. White was as follows: ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ $ 2.8 Trade accounts receivable ​ 10.2 Inventories ​ 17.1 Property, plant and equipment ​ 15.9 Intangible assets ​ 50.1 Goodwill ​ 27.1 Other assets ​ 1.0 Accounts payable ​ ( 1.8 ) Accrued compensation and employee benefits ​ ( 1.9 ) Deferred income taxes ​ ( 8.3 ) Other liabilities ​ ( 1.7 ) Purchase price ​ $ 110.5 ​ The Company engaged third-party valuation specialists to assist in estimating the fair value of assets acquired. The third-party valuations utilized assumptions developed by management and other information compiled by management, including, but not limited to, future expected cash flows. The Company allocated the excess of the purchase price over the net assets recognized to goodwill in the amount of $ 27.1 million, none of which is expected to be deductible for income tax purposes. Goodwill represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. The goodwill recorded as part of the acquisition includes L.B. White’s workforce and anticipated future revenue and cost synergies. Below is a summary of the methodologies and significant assumptions used within the third-party valuations for estimating the fair value of certain classes of acquired assets. The fair values were primarily based upon significant inputs that are not observable in the market and thus represent Level 3 measurements. See Note 4 for information regarding Level 3 fair value measurements. Inventories: The Company determined the fair value of acquired work-in-process and finished goods inventory using both the comparative sales and cost of reproduction valuation methods. For raw materials acquired, the Company estimated the cost of replacement. In total, the Company wrote-up acquired inventory by $ 1.0 million and charged it to cost of sales during fiscal 2026 as the underlying inventory was sold. 61 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Property, plant and equipment: The Company valued the land and facilities acquired using the cost approach. The cost approach included consideration of recent sales of comparable land parcels and estimated replacement costs for structures and site improvements, adjusting such values for estimated depreciation as of the acquisition date. The cost approach relies on assumptions regarding replacement costs and the age and estimated remaining useful lives of the assets. For personal property, which primarily consists of machinery and equipment assets, the Company utilized the market valuation approach that considers values for similar assets on secondary equipment markets. The fair value of property, plant and equipment will be recognized as depreciation expense in the Company’s results of operations over the expected remaining useful lives of the assets. Intangible assets: The Company determined the fair value of acquired intangible assets by using variations of the income approach. These methods generally forecast expected future net cash flows associated with each of the identified intangible assets and adjust the forecasts to present value by applying a discount rate intended to reflect risk factors associated with the cash flows and the time value of money. Acquired intangible assets were as follows: ​ ​ ​ ​ ​ ​ ​ Gross Carrying Value ​ Weighted- Average Useful Life Customer relationships $ 38.5 ​ 14 years Trade name 11.6 ​ 20 years Total intangible assets acquired $ 50.1 ​ ​ ​ Customer relationships represent the estimated fair value of L.B. White’s business relationships with existing customers, the majority of which are dealers and/or distributors in the agriculture and portable heating markets. The fair value of customer relationships was determined using the multi-period excess earnings method, in which the value is derived by projecting the future anticipated after-tax cash flows attributable to the customer relationships. Key inputs used in the valuation included future revenue growth rates, customer attrition rates, and discount rates. The Company determined the estimated fair value of the acquired L.B. White trade name using the relief-from-royalty method, which applies an assumed royalty rate to revenue expected to be derived under the acquired trade name. The fair value was estimated to be the present value of the royalties saved because the Company owns the trade name. Climate by Design On July 1, 2025, the Company acquired Climate by Design for $ 64.4 million ($ 63.4 million net of cash acquired). The Company primarily utilized its revolving credit facility to fund the purchase price. Based in Minnesota, Climate by Design specializes in desiccant dehumidification technology and critical process air handlers. This acquisition supports the Company’s growth strategy by expanding its commercial indoor air quality product portfolio. During fiscal 2026, the Company included $ 30.5 million of net sales within its consolidated statement of operations attributable to Climate by Design. ​ ​ ​ ​ ​ 62 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company’s allocation of the purchase price for its acquisition of Climate by Design was as follows: ​ ​ ​ ​ ​ Cash and cash equivalents ​ ​ ​ $ 1.0 Trade accounts receivable ​ 7.3 Inventories ​ 10.1 Property, plant and equipment ​ 10.5 Intangible assets ​ 15.0 Goodwill ​ 23.6 Other assets ​ 10.4 Accounts payable ​ ( 1.8 ) Accrued compensation and employee benefits ​ ( 1.0 ) Other liabilities ​ ( 10.7 ) Purchase price ​ $ 64.4 ​ The Company engaged third-party valuation specialists to assist in estimating the fair value of assets acquired. The third-party valuations utilized assumptions developed by management and other information compiled by management, including, but not limited to, future expected cash flows. The Company allocated the excess of the purchase price over the net assets recognized to goodwill in the amount of $ 23.6 million. Goodwill represents the future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. The goodwill recorded as part of the acquisition includes Climate by Design’s workforce and anticipated future revenue and cost synergies. Goodwill is expected to be deductible for income tax purposes. Below is a summary of the methodologies and significant assumptions used within the third-party valuations for estimating the fair value of certain classes of acquired assets. The fair values were primarily based upon significant inputs that are not observable in the market and thus represent Level 3 measurements. See Note 4 for information regarding Level 3 fair value measurements. Inventories: The Company estimated the fair value of acquired work-in-process and finished goods inventory using both the comparative sales and cost of reproduction valuation methods. For raw materials acquired, the Company estimated the cost of replacement. The Company wrote-up acquired inventory by $ 0.3 million. The Company charged the write-up to cost of sales during fiscal 2026 as the underlying inventory was sold. Intangible assets: The Company estimated the fair value of acquired intangible assets by using variations of the income approach. These methods generally forecast expected future net cash flows associated with each of the identified intangible assets and adjust the forecasts to present value by applying a discount rate intended to reflect risk factors associated with the cash flows and the time value of money. Acquired intangible assets were as follows: ​ ​ ​ ​ ​ ​ ​ Gross Carrying Value ​ Weighted- Average Useful Life Customer relationships $ 8.3 ​ 10 years Acquired technology 3.5 ​ 10 years Trade name 3.2 ​ 10 years Total intangible assets acquired $ 15.0 ​ ​ ​ Customer relationships represent the estimated fair value of Climate by Design’s business relationships with existing customers. The fair value of customer relationships was estimated using the multi-period excess earnings method, in which the value is derived by projecting the future anticipated after-tax cash flows attributable to the customer relationships. Key inputs used in the valuation included future revenue growth rates, customer attrition rates, and discount rates. 63 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company estimated the fair value of the acquired Climate by Design technology using the relief-from-royalty method, considering estimated royalties that would hypothetically be paid to use the technology. The Company estimated the fair value of the acquired Climate by Design trade name using the relief-from-royalty method, which applies an assumed royalty rate to revenue expected to be derived under the acquired trade name. The fair value was estimated to be the present value of the royalties saved because the Company owns the trade name. ​ Fiscal 2024 Acquisitions The Company acquired the Scott Springfield Mfg. Inc. (“Scott Springfield Manufacturing”) and Napps Technology Corporation (“Napps”) businesses during fiscal 2024. In addition, the Company purchased intellectual property and related assets from TMGcore, Inc. ​ Scott Springfield Manufacturing On March 1, 2024, the Company acquired all of the issued and outstanding shares in the capital of Scott Springfield Manufacturing for consideration totaling $ 184.1 million. Upon finalization of the working capital adjustment during fiscal 2025, the Company paid an additional $ 2.4 million to the seller. Based in Calgary, Canada, Scott Springfield Manufacturing is a leading manufacturer of air handling units to customers in the data center, telecommunications, healthcare, and aerospace markets. This acquisition expanded the Company’s product offerings and customer base in the high-growth data center and indoor air quality markets in the U.S. and Canada. Since the date of the acquisition, the Company has reported the financial results of the Scott Springfield Manufacturing business within the Climate Solutions segment. Napps On July 1, 2023, the Company acquired substantially all of the net operating assets of Napps, a Texas-based manufacturer of air- and water-cooled chillers, condensing units and heat pumps, for consideration totaling $ 5.8 million. The Company paid $ 4.8 million during fiscal 2024 and paid the remaining $ 1.0 million to the seller during fiscal 2025. The Company has reported the financial results of the Napps business within the Climate Solutions segment since the date of the acquisition. TMGcore, Inc. intellectual property In January 2024, the Company purchased intellectual property and other related assets from TMGcore, Inc., a specialist in single- and two-phase liquid immersion cooling technology for data centers for $ 12.0 million. Dispositions During fiscal 2022, the Company sold its Austrian automotive business. To facilitate the closing of this sale, the Company provided the buyer with a loan facility. During the fourth quarter of fiscal 2026, the Company and the buyer settled the loan facility for less than the principal balance outstanding. As a result, the Company recorded a loss of $ 3.9 million during fiscal 2026 to write-off the remaining loan receivable. The Company has reported this loss within the loss on sale of assets line on its consolidated statement of operations. ​ In October 2023, the Company sold three automotive businesses based in Germany (the “disposal group”) to affiliates of Regent, L.P. As a result of the sale, the Company recorded a $ 4.0 million gain on sale during fiscal 2024, primarily driven by the net liability position of the disposal group at the time of sale. In addition, the gain on sale included the write-off of $ 0.6 million of net actuarial gains related to the disposal group’s pension plans. The Company reported the $ 4.0 million gain on the gain on sale of assets line within the consolidated statement of operations. Prior to the disposition, the Company reported the financial results of the disposal group within the Performance Technologies segment. Net sales of the disposal group included within the Company’s consolidated statement of operations for fiscal 2024 totaled $ 54.2 million. ​ ​ 64 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Pending Reverse Morris Trust transaction In January 2026, the Company and Gentherm Incorporated (“Gentherm”) announced that they had entered into definitive agreements whereby the Company will spin-off and simultaneously combine its Performance Technologies segment businesses with Gentherm in a Reverse Morris Trust transaction. Gentherm, a Michigan-based corporation, is a global leader of innovative thermal management and pneumatic comfort technologies. The transaction is intended to establish Gentherm as a scaled leader in thermal management. The Company will retain its Climate Solutions segment businesses, creating a pure-play climate solutions company focused on the data center and commercial HVAC&R markets. ​ Under the terms of the agreements, at the time of the spin-off of its Performance Technologies segment businesses, the Company’s shareholders will receive newly-issued Gentherm stock, representing ownership of approximately 40 percent of the combined company. In addition, immediately prior to transaction closing, the Company is to receive cash proceeds of $ 210.0 million, subject to adjustment. Based upon the Gentherm stock price, the transaction was valued at approximately $ 1.0 billion when the Company entered into the agreement. The Company anticipates this transaction will close by the end of calendar 2026, subject to approval by Gentherm’s shareholders and other closing conditions, including regulatory approvals. Under the Reverse Morris Trust structure, the transaction is intended to be generally tax-free for U.S. federal income tax purposes for the Company and its shareholders. ​ Since the pending spin-off does not constitute a sale under U.S. GAAP, the Company has not classified the assets and liabilities of its Performance Technologies segment as held for sale on its March 31, 2026 consolidated balance sheet. However, the Company expects to classify the Performance Technologies segment as a discontinued operation starting in the period the transaction is completed. ​ Pending sale of facilities in Germany In fiscal 2025, the Company signed a definitive agreement to sell its technical service center and administrative support facility in Germany to a real estate investment firm. The Company closed the technical service center earlier in fiscal 2025 and reduced headcount in light of the sale of three automotive businesses in Germany during fiscal 2024. During fiscal 2026 and based upon a lower expected selling price of approximately $ 5.0 million in light of market and other transaction-specific factors, the Company estimated an implied loss in excess of the building and related assets’ carrying value. As a result, the Company recorded a non-cash impairment charge of $ 4.1 million during fiscal 2026. As of March 31, 2026 and 2025, the Company classified $ 4.6 million and $ 8.2 million, respectively, of building and related assets as held for sale and presented them within other current assets on its consolidated balance sheets. The Company expects the sale transaction will close during fiscal 2027. ​ Note 3: Revenue Recognition The Company sells thermal management products and solutions in a wide array of commercial, industrial, and building HVAC&R markets. In addition, the Company sells engineered heat transfer systems and high-quality heat transfer components for use in on- and off-highway original OEM vehicular applications. The Company recognizes revenue based upon consideration specified in a contract and as it satisfies performance obligations by transferring control over its products to its customers, which may be at a point in time or over time. As the majority of the underlying sales contracts for its highly-specified products do not provide the Company with an enforceable right to payment for performance completed to date in the event of cancellation, the Company recognizes the majority of its revenue at a point in time, based upon shipment terms. For the limited number of customer contracts that provide an enforceable right to payment for performance completed to date, the Company recognizes revenue over time based upon its estimated progress toward satisfaction of the performance obligations. ​ ​ 65 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company records an allowance for credit losses and accrues for estimated warranty costs at the time of sale. These estimates are based upon historical experience, current business trends, and current economic conditions. The Company accounts for shipping and handling activities as fulfillment costs rather than separate performance obligations and records shipping and handling costs in cost of sales and related amounts billed to customers in net sales. The Company establishes payment terms with its customers based upon industry and regional practices, which typically do not exceed 90 days. As the Company expects to receive payment from its customers within one year from the time of sale, it disregards the effects of the time value of money in its determination of the transaction price. The Company has not disclosed the value of unsatisfied performance obligations because the revenue associated with customer contracts for which the original expected performance period is greater than one year is not material. The following is a description of the Company’s principal revenue-generating activities: Climate Solutions The Climate Solutions segment provides energy-efficient, climate-controlled solutions and components for a wide array of applications. The Climate Solutions segment has aligned its teams around three product groups: i) Data Centers, ii) Heat Transfer Solutions and iii) HVAC Technologies. The Data Centers business provides sustainable cooling solutions for data center customers. Data center products include chillers, dry coolers, precision air handling units, computer room air conditioning and air handler units, fan walls, rear-door heat exchangers, coolant distribution units (“CDU”) and immersion solutions. The Heat Transfer Solutions business provides heat exchanger coils, anti-corrosion coating products, commercial and industrial refrigeration products and power generation and transmission cooling solutions. The HVAC Technologies business provides a wide array of commercial and residential heating products, including unit heaters, roof-mounted makeup air units, duct furnaces, infrared units, and perimeter heating products. In addition, the HVAC Technologies business sells indoor air quality products for schools and commercial applications. For the majority of its sales, individual customer purchase orders represent the Climate Solutions segment’s contract with its customers and the segment recognizes revenue when it transfers control over its products to its customers, based upon shipment terms. Heating products are largely sold to independent distributors in the U.S., who in turn market the heating products to end customers. The Climate Solutions segment recognizes coatings product sales over-time, since the customers control the equipment being enhanced by the coating application. In addition, for sales to customers whose contract cancellation terms provide an enforceable right to payment for customized products and solutions, the Climate Solutions segment recognizes revenue over time based upon its estimated progress toward satisfaction of the performance obligations. Performance Technologies The Performance Technologies segment has aligned its teams around two product groups: i) Heavy-Duty Equipment and ii) On-Highway Applications. The Heavy-Duty Equipment business provides heat exchangers and cooling modules for off-highway markets, including agricultural and construction. In addition, the Heavy-Duty Equipment business sells cooling module generator sets that provide mission-critical stationary power. The On-Highway Applications business provides heat exchangers and cooling systems for commercial vehicle, automotive, bus and specialty vehicle customers. In addition to products for traditional powertrains, the On-Highway Applications business provides products and solutions for zero-emission and hybrid vehicles. While the Performance Technologies segment provides customized production and service parts to customers under multi-year agreements, these agreements typically do not contain contractually-guaranteed volumes to be purchased by the customer. As a result, individual purchase orders typically represent the quantities ordered by the customer. With the exception of a small number of customers, the terms within the customer agreement, purchase order, or customer-owned tooling contract do not provide the Company with an enforceable right to payment for performance completed to date. As a result, the Performance Technologies segment recognizes revenue primarily at the time control is transferred to the customer based upon shipping terms, which is generally upon shipment. 66 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Disaggregation of revenue The tables below present revenue for each of the Company’s operating segments, Climate Solutions and Performance Technologies. Each segment’s revenue is disaggregated by product group and by geographic location. Effective April 1, 2025, and in connection with the Company’s strategic transformation and application of 80/20 principles, the Company realigned its segment teams around five market-based product groups, as summarized above. Accordingly, the disaggregated revenue information presented in the tables below reflect the current product group structure. The fiscal 2025 and 2024 information has been recast to be comparable with the fiscal 2026 presentation. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2026 ​ ​ ​ ​ Climate ​ ​ ​ Performance ​ ​ ​ Segment ​ ​ Solutions ​ Technologies ​ Total Product groups: ​ ​ ​ ​ ​ ​ Data Centers ​ $ 1,112.1 ​ $ — ​ $ 1,112.1 Heat Transfer Solutions ​ ​ 584.1 ​ ​ — ​ ​ 584.1 HVAC Technologies ​ 359.2 ​ — ​ 359.2 Heavy-Duty Equipment ​ — ​ 409.3 ​ 409.3 On-Highway Applications ​ — ​ 716.4 ​ 716.4 Inter-segment sales ​ 6.9 ​ 6.1 ​ 13.0 Net sales ​ $ 2,062.3 ​ $ 1,131.8 ​ $ 3,194.1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Geographic location: ​ ​ ​ ​ ​ ​ Americas ​ $ 1,535.5 ​ $ 593.8 ​ $ 2,129.3 Europe ​ 501.4 ​ 336.8 ​ 838.2 Asia ​ 25.4 ​ 201.2 ​ 226.6 Net sales ​ $ 2,062.3 ​ $ 1,131.8 ​ $ 3,194.1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2025 ​ ​ ​ ​ Climate ​ ​ ​ Performance ​ ​ ​ Segment ​ ​ Solutions ​ Technologies ​ Total Product groups: ​ ​ ​ ​ ​ ​ ​ ​ ​ Data Centers ​ $ 644.2 ​ $ — ​ $ 644.2 Heat Transfer Solutions ​ ​ 539.4 ​ ​ — ​ ​ 539.4 HVAC Technologies ​ 257.0 ​ — ​ 257.0 Heavy-Duty Equipment ​ — ​ 422.1 ​ 422.1 On-Highway Applications ​ — ​ 720.8 ​ 720.8 Inter-segment sales ​ 0.2 ​ 20.6 ​ 20.8 Net sales ​ $ 1,440.8 ​ $ 1,163.5 ​ $ 2,604.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Geographic location: ​ ​ ​ ​ ​ ​ Americas ​ $ 997.8 ​ $ 695.6 ​ $ 1,693.4 Europe ​ 415.8 ​ 295.9 ​ 711.7 Asia ​ 27.2 ​ 172.0 ​ 199.2 Net sales ​ $ 1,440.8 ​ $ 1,163.5 ​ $ 2,604.3 ​ ​ ​ ​ ​ ​ ​ ​ 67 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2024 ​ ​ ​ ​ Climate ​ ​ ​ Performance ​ ​ ​ Segment ​ ​ Solutions ​ Technologies ​ Total Product groups: ​ ​ ​ ​ ​ ​ ​ Data Centers ​ $ 294.2 ​ $ — ​ $ 294.2 Heat Transfer Solutions ​ ​ 606.4 ​ ​ — ​ ​ 606.4 HVAC Technologies ​ 207.5 ​ — ​ 207.5 Heavy-Duty Equipment ​ — ​ 463.3 ​ 463.3 On-Highway Applications ​ — ​ 836.4 ​ 836.4 Inter-segment sales ​ — ​ 21.6 ​ 21.6 Net sales ​ $ 1,108.1 ​ $ 1,321.3 ​ $ 2,429.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Geographic location: ​ ​ ​ ​ ​ ​ Americas ​ $ 649.0 ​ $ 721.0 ​ $ 1,370.0 Europe ​ 432.7 ​ 406.8 ​ 839.5 Asia ​ 26.4 ​ 193.5 ​ 219.9 Net sales ​ $ 1,108.1 ​ $ 1,321.3 ​ $ 2,429.4 ​ Contract balances Contract assets and contract liabilities from contracts with customers were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2026 ​ ​ ​ March 31, 2025 Contract assets ​ $ 43.6 ​ $ 13.3 Contract liabilities ​ 194.5 ​ 35.1 ​ Contract assets, included within other current assets in the consolidated balance sheets, primarily consist of assets recorded for revenue recognized over time, which represent the Company’s rights to consideration for work completed but not yet billed, and capitalized costs related to customer-owned tooling contracts, wherein the customer has guaranteed reimbursement. The $ 30.3 million increase in contract assets during fiscal 2026 primarily resulted from an increase in contract assets for revenue recognized over time, partially offset by a decrease in capitalized costs related to the Company’s fulfillment of its performance obligations. Contract liabilities primarily consist of customer deposits. During March 2026, the Company entered into a long-term capacity agreement with one of its strategic data center customers. In connection with this agreement, the Company received a $ 165.0 million up-front deposit from the customer to support the Company’s investments necessary to meet the planned sales volume. In addition, the contract liabilities include payments received in advance of satisfying performance obligations under customer contracts, including contracts for data center products and customer-owned tooling. The $ 159.4 million increase in contract liabilities during fiscal 2026 primarily resulted from the aforementioned up-front deposit to support production capacity expansion. Contract liabilities are included within other current and noncurrent liabilities on the Company’s consolidated balance sheets. As of March 31, 2026, contract liabilities included within other current and noncurrent liabilities totaled $ 23.9 million and $ 170.6 million, respectively. As of March 31, 2025, contract liabilities included within other current and noncurrent liabilities totaled $ 33.2 million and $ 1.9 million, respectively. ​ ​ ​ ​ 68 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 4: Fair Value Measurements Fair value is defined as the price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Fair value measurements are classified under the following hierarchy: ● 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. When available, the Company uses quoted market prices to determine fair value and classifies such measurements as Level 1. In some cases, where market prices are not available, the Company uses observable market-based inputs to calculate fair value, in which case the measurements are classified as Level 2. If quoted or observable market prices are not available, the Company determines fair value based upon valuation models that use, where possible, market-based data such as interest rates, yield curves or currency rates. These measurements are classified as Level 3. The carrying values of cash, cash equivalents, restricted cash, trade accounts receivable, accounts payable, and short-term debt approximate fair value due to the short-term nature of these instruments. In addition, the Company assesses the fair value of a disposal group for each reporting period it is held for sale. See Note 2 for additional information regarding assets held for sale. The fair value of the Company’s long-term debt is disclosed in Note 17. The Company holds investments in deferred compensation trusts to fund obligations under certain non-qualified deferred compensation plans. The Company records the fair value of these investments within other noncurrent assets on its consolidated balance sheets. The Company classifies money market investments held by the trusts within Level 2 of the valuation hierarchy. The Company classifies all other investments held by the trusts within Level 1 of the valuation hierarchy, as it uses quoted market prices to determine the investments’ fair value. The Company’s deferred compensation obligations, which are recorded as other noncurrent liabilities, are recorded at the fair values of the investments held by the trust. At March 31, 2026 and 2025, the fair values of the investments and obligations for the Company’s deferred compensation plans each totaled $ 8.3 million and $ 6.1 million, respectively. During fiscal 2026 and in connection with the previously-announced plan termination, the Company terminated its primary U.S. pension plan, and as a result, has no plan assets as of March 31, 2026. See Note 18 for additional information. Plan assets related to the Company’s pension plans, as of March 31, 2025, were classified as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2025 ​ ​ ​ ​ Level 1 ​ ​ ​ Level 2 ​ ​ ​ Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Money market investments ​ $ — ​ $ 2.7 ​ $ 2.7 Fixed income securities ​ — ​ 51.3 ​ 51.3 U.S. government and agency securities ​ — ​ 87.0 ​ 87.0 Other ​ 1.4 ​ 8.4 ​ 9.8 Total fair value ​ $ 1.4 ​ $ 149.4 ​ $ 150.8 ​ ​ ​ ​ ​ ​ 69 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company determined the fair value of money market investments to approximate their net asset values, without discounts for credit quality or liquidity restrictions, and classified them within Level 2 of the valuation hierarchy. The Company determined the fair value of fixed income securities and U.S. government and agency securities based upon recent bid prices or the average of recent bid and asking prices when available and, if not available, the Company valued them through matrix pricing models developed by sources considered by management to be reliable. The Company classified these assets within Level 2 of the valuation hierarchy. As of March 31, 2025, the Company held no Level 3 assets within its pension plans. ​ Note 5: Stock-Based Compensation The Company’s stock-based compensation programs consist of the following: (i) a long-term incentive plan (“LTIP”) for officers and other executives that authorizes grants of stock awards, stock options, and performance-based awards granted for retention and performance, (ii) a discretionary equity program for other management and key employees, and (iii) stock awards for non-employee directors. The Company’s Board of Directors and the Human Capital and Compensation Committee, as applicable, have discretionary authority to set the terms of the stock-based awards. Grants to employees during fiscal 2026 were issued under the Company’s Amended and Restated 2020 Incentive Compensation Plan. In fiscal 2026, 2025 and 2024, the Company granted performance-based stock awards and restricted stock awards. At present, the Company settles equity-based grants through newly issued shares of common stock. As of March 31, 2026, approximately 1.0 million shares authorized under the Amended and Restated 2020 Incentive Compensation Plan remain available for future grants. Employee participants have the opportunity to deliver back to the Company the number of shares from the vesting of stock awards sufficient to satisfy the individual’s minimum tax withholding obligations. These shares are held as treasury shares. The Company recorded stock-based compensation expense of $ 22.1 million, $ 26.4 million, and $ 10.8 million in fiscal 2026, 2025 and 2024, respectively. During fiscal 2026 and 2025, in connection with restructuring actions, the Company modified certain stock-based awards for a limited number of employees to permit accelerated vesting, resulting in $ 2.1 million and $ 6.0 million, respectively, of incremental stock-based compensation expense. Restricted stock The Company recorded $ 5.7 million, $ 8.0 million, and $ 5.3 million of compensation expense related to restricted stock in fiscal 2026, 2025 and 2024, respectively. The grant date fair value of restricted stock awards that vested during fiscal 2026, 2025 and 2024 was $ 6.6 million, $ 6.3 million, and $ 4.6 million, respectively. At March 31, 2026, the Company had $ 8.1 million of unrecognized compensation expense related to non-vested restricted stock, which it expects to recognize over a weighted-average period of 1.7 years. The Company values restricted stock awards using the closing market price of its common shares on the date of grant. Based upon the terms of the annual awards, restricted stock awards vest 33 percent, 33 percent, and 34 percent per year for three years , respectively. Restricted stock awards granted to non-employee directors vest one year from the date of grant. A summary of restricted stock activity for fiscal 2026 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average ​ ​ ​ ​ Shares ​ ​ ​ price Non-vested balance, beginning of year ​ 0.3 ​ $ 42.90 Granted ​ 0.1 ​ ​ 136.97 Vested ​ ( 0.2 ) ​ ​ 35.75 Forfeited ​ ( 0.1 ) ​ ​ 60.88 Non-vested balance, end of year ​ 0.1 ​ $ 107.65 ​ Stock options The Company recorded $ 0.1 million, $ 1.7 million, and $ 1.0 million of compensation expense related to stock options in fiscal 2026, 2025 and 2024, respectively. The grant date fair value of stock options that vested during fiscal 2026, 2025 and 2024, was $ 0.7 million, $ 1.0 million, and $ 1.2 million, respectively. As of March 31, 2026, the Company has no unvested stock option awards. 70 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Stock options expire no later than 10 years after the grant date and have an exercise price equal to the fair market value of Modine’s common stock on the date of grant. The Company did no t grant options in fiscal 2026, 2025 or 2024. A summary of stock option activity for fiscal 2026 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average ​ remaining contractual ​ Aggregate ​ ​ Shares ​ exercise price ​ term (years) ​ intrinsic value Outstanding, beginning of year 0.5 ​ $ 12.94 ​ ​ ​ Exercised ( 0.3 ) ​ 12.56 ​ ​ ​ Forfeited or expired — ​ 12.49 ​ ​ ​ Outstanding, end of year 0.2 ​ $ 13.43 5.0 ​ $ 44.1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Exercisable, March 31, 2026 0.2 ​ $ 13.43 5.0 ​ $ 44.1 ​ The aggregate intrinsic value represents the difference between the closing price of Modine’s common shares on the last trading day of fiscal 2026 over the exercise price of the stock options, multiplied by the number of options outstanding or exercisable. The aggregate intrinsic value is not recorded for financial statement purposes, and this value will change based upon daily changes in the price of Modine’s common shares. Additional information related to stock options exercised is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Intrinsic value of stock options exercised ​ $ 37.4 ​ $ 8.1 ​ $ 12.4 Proceeds from stock options exercised ​ 3.5 ​ 1.0 ​ 2.6 ​ ​ Restricted stock – performance-based stock awards The Company granted performance-based stock awards in fiscal 2026, 2025 and 2024. For performance-based stock awards, the Company values the awards using the closing market price of its common shares on the date of grant. The Company recorded $ 16.3 million, $ 16.7 million, and $ 4.5 million of compensation expense related to performance-based stock awards in fiscal 2026, 2025 and 2024, respectively. At March 31, 2026, the Company had $ 20.4 million of unrecognized compensation expense related to non-vested performance-based stock awards, which it expects to recognize over a weighted-average period of 1.6 years. Shares earned under the performance portion of the incentive program are based upon the attainment of certain financial targets over a three -year period and are issued after the end of that three -year performance period, if the performance targets have been achieved. The performance metrics for the performance-based awards granted in fiscal 2026, 2025 and 2024 are based upon both a target three -year average consolidated cash flow return on invested capital and a target three -year average growth in consolidated net earnings before interest, taxes, depreciation, amortization, and certain other adjustments (“Adjusted EBITDA”) at the end of the three -year performance period, commencing with the fiscal year of grant. ​ ​ ​ ​ ​ 71 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 6: Restructuring Activities Restructuring and repositioning expenses were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Employee severance and related benefits ​ $ 12.9 ​ $ 24.3 ​ $ 12.9 Other restructuring and repositioning expenses ​ 7.7 ​ 3.9 ​ 2.1 Total ​ $ 20.6 ​ $ 28.2 ​ $ 15.0 ​ During fiscal 2026, restructuring and repositioning expenses primarily consisted of severance expenses. The severance charges were primarily recorded in Europe and North America and include severance related to targeted headcount reductions intended to reduce SG&A and operational expenses. In addition, as part of its transformational initiatives supported by 80/20 principles, the Company is taking steps to optimize its supply chain and manufacturing footprint in order to support its expansion of manufacturing capacity in the U.S. for data center products and to improve profit margins. These repositioning activities have included transferring the production for certain product lines among its facilities. During fiscal 2025, restructuring and repositioning expenses primarily consisted of severance expenses in Europe and North America within the Performance Technologies segment and included targeted headcount reductions intended to reduce SG&A and operational expenses. In addition, the Company recorded severance expenses in the Climate Solutions segment, primarily related to the closure of a production facility in Italy. Other restructuring and repositioning expenses include costs to transfer production and warehousing for certain product lines among its facilities, related to the Company’s transformational initiatives. During fiscal 2024, restructuring and repositioning expenses primarily consisted of severance expenses in the Performance Technologies segment related to the closure of its European technical service center. In addition, the Company incurred equipment transfer costs within the Climate Solutions and Performance Technology segments related to its transformational initiatives. The Company accrues severance in accordance with its written plans, procedures, and relevant statutory requirements. Changes in accrued severance were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Beginning balance ​ $ 6.6 ​ $ 13.0 Additions (a) ​ 10.8 ​ 18.3 Payments ​ ( 14.0 ) ​ ( 24.6 ) Effect of exchange rate changes ​ 0.2 ​ ( 0.1 ) Ending balance ​ $ 3.6 ​ $ 6.6 ____ ​ ​ ​ ​ ​ ​ ​ (a) The fiscal 2026 and 2025 amounts exclude $ 2.1 million and $ 6.0 million, respectively, of non-cash severance-expense resulting from the accelerated vesting of certain stock-based compensation awards in connection with restructuring actions. ​ 72 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 7: Other Income and Expense Other income and expense consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Interest income ​ $ 2.0 ​ $ 2.7 ​ $ 4.3 Foreign currency transactions (a) ​ ( 6.7 ) ​ ( 1.2 ) ​ ( 3.0 ) Net periodic benefit cost (b) ​ ( 3.5 ) ​ ( 4.6 ) ​ ( 3.3 ) Total other expense – net ​ $ ( 8.2 ) ​ $ ( 3.1 ) ​ $ ( 2.0 ) ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Foreign currency transactions primarily consist of foreign currency transaction gains and losses on the re-measurement or settlement of foreign currency-denominated assets and liabilities, including intercompany loans and transactions denominated in a foreign currency, along with gains and losses on certain foreign currency exchange contracts. (b) Net periodic benefit cost for the Company’s pension and postretirement plans is exclusive of service cost and the $ 116.1 million pension termination charge recorded in fiscal 2026. See Note 18 for additional information. ​ Note 8: Income Taxes The U.S. and foreign components of earnings before income taxes and the provision for income taxes consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Components of earnings (loss) before income taxes: ​ ​ ​ ​ ​ ​ United States ​ $ ( 51.3 ) ​ $ 41.7 ​ $ 37.2 Foreign ​ 237.8 ​ 212.3 ​ 177.4 Total earnings before income taxes ​ $ 186.5 ​ $ 254.0 ​ $ 214.6 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Income tax provision (benefit): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current: ​ ​ ​ ​ ​ ​ U.S. Federal ​ $ 39.1 ​ $ 4.7 ​ $ 1.6 State ​ 7.6 ​ 4.5 ​ 2.4 Foreign ​ 55.6 ​ 52.8 ​ 41.0 Total current provision ​ ​ 102.3 ​ ​ 62.0 ​ ​ 45.0 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred: ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Federal ​ ( 34.6 ) ​ 5.8 ​ 7.1 State ​ ( 5.2 ) ​ ( 2.2 ) ​ ( 0.9 ) Foreign ​ 0.7 ​ 2.9 ​ — Total deferred (benefit) provision ​ ​ ( 39.1 ) ​ 6.5 ​ 6.2 ​ ​ ​ ​ ​ ​ ​ ​ ​ Total provision for income taxes ​ $ 63.2 ​ $ 68.5 ​ $ 51.2 ​ 73 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The reconciliation between the U.S. federal statutory income tax rate and the Company’s effective tax rate was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ ​ 2026 ​ ​ ​ ​ 2025 ​ ​ ​ ​ 2024 ​ ​ ​ Amount Rate ​ ​ Amount Rate ​ ​ Amount Rate ​ U.S. federal statutory income tax rate $ 39.2 21.0 % ​ $ 53.3 21.0 % ​ $ 45.1 21.0 % U.S. tax effects: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ State taxes, net of federal benefit (a) ​ 1.9 1.0 ​ ​ 1.0 0.4 ​ ​ 1.4 0.7 Effect of cross-border tax laws (b): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreign-derived intangible income ​ ( 3.6 ) ( 1.9 ) ​ ​ ( 2.7 ) ( 1.1 ) ​ ​ — — U.S. tax effects on foreign branch income ​ — — ​ ​ — — ​ ​ ( 6.0 ) ( 2.8 ) Disposition of businesses (c) ​ — — ​ ​ — — ​ ​ ( 1.8 ) ( 0.8 ) Other ​ ( 0.4 ) ( 0.2 ) ​ ​ 0.1 — ​ ​ ( 0.8 ) ( 0.4 ) Nontaxable or nondeductible: ​ ​ ​ ​ ​ ​ ​ ​ — ​ ​ ​ ​ ​ ​ Nondeductible compensation ​ 8.0 4.3 ​ ​ 7.4 2.9 ​ ​ 4.7 2.2 Stock-based compensation awards ​ ( 6.6 ) ( 3.5 ) ​ ​ ( 5.1 ) ( 2.0 ) ​ ​ ( 4.1 ) ( 1.9 ) Other ​ 1.3 0.7 ​ ​ 0.2 0.1 ​ ​ 0.4 0.2 Tax credits ​ ( 1.4 ) ( 0.7 ) ​ ​ ( 2.3 ) ( 0.9 ) ​ ​ ( 2.1 ) ( 1.0 ) Changes in valuation allowances ​ 1.0 0.5 ​ ​ 0.2 0.1 ​ ​ 8.3 3.9 Other: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension termination (d) ​ 13.7 7.3 ​ ​ — — ​ ​ — — Other ​ ( 0.1 ) — ​ ​ ( 0.7 ) ( 0.2 ) ​ ​ 0.4 0.1 Foreign tax effects: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Germany: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Changes in valuation allowances ​ 2.4 1.3 ​ ​ 4.1 1.6 ​ ​ 2.9 1.4 Other ​ 1.5 0.8 ​ ​ ( 0.5 ) ( 0.2 ) ​ ​ ( 1.0 ) ( 0.5 ) Hungary: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Changes in valuation allowances ​ ( 2.0 ) ( 1.1 ) ​ ​ — — ​ ​ — — Expiration of attribute carryforward ​ 2.0 1.1 ​ ​ — — ​ ​ — — Other ​ ( 1.1 ) ( 0.6 ) ​ ​ — — ​ ​ — — India: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Withholding tax ​ 2.1 1.1 ​ ​ — — ​ ​ — — Other ​ 0.9 0.5 ​ ​ — — ​ ​ — — Mexico ​ — — ​ ​ 3.0 1.2 ​ ​ — — Brazil ​ — — ​ ​ 2.9 1.1 ​ ​ — — Italy ​ — — ​ ​ 2.8 1.1 ​ ​ — — Other foreign jurisdictions ​ 4.0 2.1 ​ ​ 4.3 1.7 ​ ​ 4.3 2.0 Changes in unrecognized tax benefits ​ ​ 0.4 0.2 ​ ​ ​ 0.5 0.2 ​ ​ ​ ( 0.5 ) ( 0.2 ) ​ Effective tax rate $ 63.2 33.9 % ​ $ 68.5 27.0 % ​ $ 51.2 23.9 % ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) State taxes in California and Mississippi make up the majority of the tax effect in this category. (b) Includes the impact of tax credits. (c) Represents the benefit to U.S. federal taxes resulting from the sale of three businesses in Germany during fiscal 2024. In total, the Company recorded a $ 3.1 million tax benefit during fiscal 2024 related to the sale. (d) Represents the detriment to U.S. federal taxes related to the Company’s termination of its primary U.S. pension plan that resulted from disproportionate income tax effects in accumulated other comprehensive loss. In total, the income tax benefit related to the fiscal 2026 pension termination charge was $ 13.1 million. ​ 74 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ As of March 31, 2026 and 2025, income tax liabilities included within other current liabilities on the Company’s consolidated balance sheets totaled $ 37.0 million and $ 16.4 million, respectively. Cash paid for income taxes, net of refunds, consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 U.S. federal $ 1.1 $ 4.9 $ 4.0 U.S. state and local (a) ​ ​ 6.4 ​ ​ 5.2 ​ ​ 2.9 Foreign: ​ ​ ​ ​ ​ ​ ​ ​ ​ Canada ​ ​ 28.5 ​ ​ 4.5 ​ ​ — India ​ ​ 6.2 ​ ​ 4.7 ​ ​ 4.4 Hungary ​ ​ 5.5 ​ ​ 3.8 ​ ​ 3.6 Brazil ​ ​ 5.2 ​ ​ 6.4 ​ ​ 6.6 Italy ​ ​ 5.2 ​ ​ 8.5 ​ ​ 6.1 Mexico ​ ​ 4.8 ​ ​ 3.8 ​ ​ 4.3 United Kingdom ​ ​ 4.3 ​ ​ — ​ ​ — China ​ ​ 4.1 ​ ​ 3.9 ​ ​ 4.2 Spain ​ ​ — ​ ​ 4.9 ​ ​ 4.9 Other foreign ​ ​ 4.5 ​ ​ 3.3 ​ ​ 4.1 Total foreign ​ ​ 68.3 ​ ​ 43.8 ​ ​ 38.2 Total income taxes paid, net ​ $ 75.8 ​ $ 53.9 ​ $ 45.1 ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) No single state or local jurisdiction accounts for more than 5 percent of total income taxes paid. In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes the permanent extension of certain provisions of the Tax Cuts and Jobs Act, including 100% bonus depreciation and domestic research cost expensing. It also includes modifications to the international tax framework. The legislation has multiple effective dates, with certain provisions impacting the Company through fiscal 2027. The Company began recognizing the impacts of the OBBBA for the provisions currently enacted during the second quarter of fiscal 2026, including the provision regarding domestic research costs. During fiscal 2026, impacts associated with provisions of the OBBBA on state deferred taxes and the utilization of foreign tax credits increased the income tax provision by $ 5.8 million. The Company is continuing to assess provisions that are expected to impact future periods. The Company records valuation allowances against its net deferred tax assets to the extent it determines it is more likely than not that such assets will not be realized in the future. Each quarter, the Company evaluates the probability that its deferred tax assets will be realized and determines whether valuation allowances or adjustments thereto are needed. This determination involves judgment and the use of significant estimates and assumptions, including expectations of future taxable income and tax planning strategies. In addition, the Company considers the duration of statutory carryforward periods and historical financial results. The Company will maintain the valuation allowances in each applicable tax jurisdiction until it determines it is more likely than not the deferred tax assets will be realized, thereby eliminating the need for a valuation allowance. Future events or circumstances, such as lower taxable income or unfavorable changes in the financial outlook of the Company’s operations in the U.S. and certain foreign jurisdictions, could necessitate the establishment of further valuation allowances. ​ ​ 75 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ As of March 31, 2026, 2025, and 2024, the Company’s deferred tax asset valuation allowances totaled $ 68.1 million, $ 67.6 million, and $ 63.0 million, respectively. The net $ 0.5 million increase during fiscal 2026 was primarily attributable to an increase in net operating losses in Germany and foreign currency impacts. These increases were partially offset by a decrease in deferred tax assets in the U.S. related to certain federal and state tax credits, which were utilized prior to expiration, and a decrease in net operating losses in Hungary due to expiration. The $ 4.6 million net increase during fiscal 2025 was primarily attributable to an increase in net operating losses in Germany. The tax effects of temporary differences that gave rise to deferred tax assets and liabilities were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Deferred tax assets: ​ ​ ​ ​ Accounts receivable ​ $ 1.0 ​ $ 0.5 Inventories ​ 11.7 ​ 5.3 Plant and equipment ​ 8.6 ​ 10.1 Lease liabilities ​ 34.6 ​ 24.2 Pension and employee benefits ​ 18.5 ​ 26.7 Net operating and capital losses ​ 49.2 ​ 50.3 Credit carryforwards ​ 37.9 ​ 35.0 Goodwill ​ ​ 4.6 ​ ​ — Research and experimental expenditures ​ 1.7 ​ 19.1 Deferred revenue liabilities ​ ​ 42.7 ​ ​ 2.6 Other, principally accrued liabilities ​ 10.3 ​ 7.6 Total gross deferred tax assets ​ 220.8 ​ 181.4 Less: valuation allowances ​ ( 68.1 ) ​ ( 67.6 ) Net deferred tax assets ​ 152.7 ​ 113.8 ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: ​ ​ ​ ​ Plant and equipment ​ 16.2 ​ 9.1 Lease assets ​ 33.5 ​ 24.1 Goodwill ​ 4.5 ​ 4.9 Intangible assets ​ 38.1 ​ 31.3 Other ​ 0.7 ​ 1.5 Total gross deferred tax liabilities ​ 93.0 ​ 70.9 Net deferred tax assets ​ $ 59.7 ​ $ 42.9 ​ Unrecognized tax benefits were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Beginning balance ​ $ 9.7 ​ $ 9.2 Gross decreases - tax positions in prior period ​ ( 0.2 ) ​ ( 0.3 ) Gross increases - tax positions in current period ​ 1.0 ​ 1.1 Lapse of statute of limitations ​ ( 0.4 ) ​ ( 0.3 ) Ending balance ​ $ 10.1 ​ $ 9.7 ​ The Company’s liability for unrecognized tax benefits as of March 31, 2026 was $ 10.1 million and, if recognized, $ 8.2 million would have an effective tax rate impact. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense. During fiscal 2026, 2025 and 2024, interest and penalties accrued on the consolidated balance sheets and included within income tax expense in the consolidated statements of operations were not significant. 76 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company files income tax returns in multiple jurisdictions and is subject to examination by taxing authorities throughout the world. At March 31, 2026, the Company was under income tax examination in several jurisdictions. The Company’s major tax jurisdictions include the United States, Italy, and Canada. For the United States, fiscal 2023 through fiscal 2025 remain subject to examination. For Italy, fiscal 2021 through fiscal 2025 remain subject to examination. For Canada, fiscal 2024 and fiscal 2025 remain subject to examination. At March 31, 2026, the Company had federal and state tax credits of $ 42.8 million that, if not utilized against U.S. taxes, will expire between fiscal 2027 and 2050 . The Company also had state and local tax loss carryforwards totaling $ 73.9 million. If not utilized against state apportioned taxable income, certain state and local carryforwards will expire between fiscal 2029 and 2043 , while some will not expire due to an unlimited carryforward period. In addition, the Company had tax loss and foreign attribute carryforwards totaling $ 296.8 million in various tax jurisdictions throughout the world. Certain of the carryforwards in foreign jurisdictions are offset by valuation allowances. If not utilized against taxable income, $ 65.3 million of these carryforwards will expire between fiscal 2027 and 2041 , and $ 231.5 million, mainly related to Germany and Italy, will not expire due to an unlimited carryforward period. The Company’s practice and intention is to reinvest, with certain insignificant exceptions, the earnings of its non-U.S. subsidiaries outside of the U.S., and therefore, the Company has not recorded foreign withholding taxes or deferred income taxes for these earnings. The Company has estimated the net amount of unrecognized foreign withholding tax and deferred tax liabilities would total approximately $ 16.0 million if the accumulated foreign earnings were distributed; however, the actual tax cost would be dependent on circumstances existing when remittance occurs. ​ Note 9: Earnings Per Share The components of basic and diluted earnings per share were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Net earnings attributable to Modine ​ $ 121.5 ​ $ 184.0 ​ $ 161.5 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average shares outstanding – basic ​ 52.8 ​ 52.6 ​ 52.4 Effect of dilutive securities ​ 1.0 ​ 1.3 ​ 1.0 Weighted-average shares outstanding – diluted ​ 53.8 ​ 53.9 ​ 53.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ Net earnings per share – basic ​ $ 2.30 ​ $ 3.50 ​ $ 3.08 Net earnings per share – diluted ​ $ 2.26 ​ $ 3.42 ​ $ 3.03 ​ For fiscal 2026, 2025 and 2024, there were no securities that were anti-dilutive. ​ Note 10: Cash, Cash Equivalents and Restricted Cash Cash, cash equivalents and restricted cash consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Cash and cash equivalents ​ $ 73.5 ​ $ 71.6 Restricted cash ​ 0.2 ​ 0.3 Total cash, cash equivalents and restricted cash ​ $ 73.7 ​ $ 71.9 ​ Restricted cash, which is reported within other current assets on the consolidated balance sheets, consists primarily of deposits for contractual guarantees or commitments required for rents, import and export duties, and commercial agreements. 77 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 11: Inventories Inventories consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Raw materials ​ $ 358.9 ​ $ 223.3 Work in process ​ 95.3 ​ 65.9 Finished goods ​ 51.9 ​ 51.7 Total inventories ​ $ 506.1 ​ $ 340.9 ​ ​ Note 12: Property, Plant and Equipment Property, plant and equipment, including depreciable lives, consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Land ​ $ 19.1 ​ $ 16.4 Buildings and improvements ( 10 - 40 years) ​ 291.1 ​ 257.7 Machinery and equipment ( 3 - 15 years) ​ 904.1 ​ 843.7 Office equipment ( 3 - 10 years) ​ 92.2 ​ 92.6 Construction in progress ​ 116.1 ​ 69.5 ​ ​ 1,422.6 ​ 1,279.9 Less: accumulated depreciation ​ ( 901.7 ) ​ ( 889.4 ) Net property, plant and equipment ​ $ 520.9 ​ $ 390.5 ​ The March 31, 2026 and 2025 property, plant and equipment in the table above exclude amounts classified as held for sale. See Note 2 for additional information. Depreciation expense totaled $ 58.7 million, $ 50.3 million, and $ 46.9 million in fiscal 2026, 2025 and 2024, respectively. Gains and losses related to the disposal of property, plant and equipment are recorded within SG&A expenses. For fiscal 2026, 2025 and 2024, gains and losses related to the disposal of property, plant and equipment were not significant. ​ Note 13: Intangible Assets Intangible assets consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2026 ​ March 31, 2025 ​ ​ ​ ​ Gross ​ ​ ​ ​ ​ ​ ​ ​ Net ​ ​ ​ Gross ​ ​ ​ ​ ​ ​ ​ ​ Net ​ ​ Carrying ​ Accumulated ​ Intangible ​ Carrying ​ Accumulated ​ Intangible ​ ​ Value ​ Amortization ​ Assets ​ Value ​ Amortization ​ Assets Customer relationships ​ $ 198.2 ​ $ ( 63.1 ) ​ $ 135.1 ​ $ 145.4 ​ $ ( 47.5 ) ​ $ 97.9 Trade names ​ 69.7 ​ ( 25.2 ) ​ 44.5 ​ 53.1 ​ ( 21.2 ) ​ 31.9 Acquired technology ​ 36.8 ​ ( 19.4 ) ​ 17.4 ​ 32.6 ​ ( 15.7 ) ​ 16.9 Total intangible assets ​ $ 304.7 ​ $ ( 107.7 ) ​ $ 197.0 ​ $ 231.1 ​ $ ( 84.4 ) ​ $ 146.7 ​ In connection with its acquisitions of three businesses during fiscal 2026, the Company recorded customer relationship, trade name, and acquired technology intangible assets totaling $ 48.1 million, $ 15.7 million, and $ 3.5 million, respectively. See Note 2 for additional information. 78 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company recorded $ 21.0 million, $ 27.4 million, and $ 9.2 million of amortization expense during fiscal 2026, 2025 and 2024, respectively. The Company estimates that it will record approximately $ 21.0 million, $ 21.0 million, $ 20.0 million, $ 19.0 million, and $ 19.0 million of annual amortization expense in fiscal 2027 through 2031, respectively. ​ Note 14: Goodwill The Company’s goodwill currently resides entirely within the Climate Solutions segment. The following table presents a roll forward of the carrying value of goodwill from March 31, 2024 to March 31, 2026. ​ ​ ​ ​ ​ ​ ​ ​ Climate ​ ​ Solutions Balance, March 31, 2024 ​ $ 230.9 Acquisition adjustment (a) ​ 7.4 Effect of exchange rate changes ​ ( 4.4 ) Balance, March 31, 2025 ​ 233.9 Acquisitions (a) ​ ​ 51.8 Effect of exchange rate changes ​ 6.4 Balance, March 31, 2026 ​ $ 292.1 ____ ​ ​ ​ ​ (a) During fiscal 2025, the Company recorded a measurement period adjustment to reduce the fair value of the acquired Scott Springfield Manufacturing trade name. This purchase accounting adjustment resulted in a $ 7.4 million increase in goodwill. During fiscal 2026, the Company recorded $ 27.1 million, $ 23.6 million, and $ 1.1 million of goodwill in connection with its acquisition of L.B. White, Climate by Design, and AbsolutAire, respectively. See Note 2 for additional information. The Company tests goodwill for impairment annually or more frequently if events or circumstances change that would, more likely than not, reduce the fair value of a reporting unit below its carrying value. To test goodwill for impairment, the Company determines the fair value of each reporting unit based upon the present value of estimated future cash flows and compares the fair value of each reporting unit with its carrying value. The Company’s determination of fair value involves judgment and the use of estimates and assumptions, including assumptions regarding the revenue growth rates and operating profit margins used to calculate estimated future cash flows and risk-adjusted discount rates. As a result of its annual goodwill impairment tests performed as of February 28, 2026, the Company determined that the fair value of each of its reporting units exceeded their respective book values. At both March 31, 2026 and 2025, accumulated goodwill impairment losses totaled $ 40.8 million within the Performance Technologies segment. ​ Note 15: Product Warranties and Other Commitments Product warranties Many of the Company’s products are covered under warranty periods that typically extend from one to two years from the shipment of the underlying products. The Company records a liability for product warranty obligations at the time of sale and adjusts the warranty accruals if it becomes probable that expected claims will differ from previous estimates. ​ ​ 79 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Changes in accrued warranty costs were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Beginning balance ​ $ 9.2 ​ $ 10.7 Warranties recorded at time of sale ​ 9.5 ​ 7.3 Adjustments to pre-existing warranties ​ 2.8 ​ ( 2.2 ) Settlements ​ ( 10.8 ) ​ ( 6.7 ) Business acquisitions (a) ​ 0.9 ​ — Effect of exchange rate changes ​ 0.2 ​ 0.1 Ending balance ​ $ 11.8 ​ $ 9.2 ____ ​ ​ ​ ​ ​ ​ ​ (a) See Note 2 for additional information on acquisitions during fiscal 2026. Indemnification agreements From time to time, the Company provides indemnification agreements related to the sale or purchase of an entity or facility. These indemnification agreements cover customary representations and warranties typically provided in conjunction with such transactions, including income, sales, excise or other tax matters, environmental matters and other third-party claims. The indemnification periods provided generally range from less than one year to fifteen years . In addition, standard indemnification provisions reside in many commercial agreements to which the Company is a party and relate to responsibility in the event of potential third-party claims. The fair value of the Company’s outstanding indemnification obligations at March 31, 2026 was not material. Commitments At March 31, 2026, the Company had capital expenditure commitments of $ 53.7 million. Significant commitments include equipment expenditures to support the expansion of manufacturing capacity in the Climate Solutions segment and tooling and equipment expenditures for new and renewal programs with vehicular customers in the Performance Technologies segment. The Company utilizes inventory arrangements with certain vendors in the normal course of business under which the vendors maintain inventory stock at the Company’s facilities or at outside facilities. Title passes to the Company at the time goods are withdrawn for use in production. The Company has agreements with the vendors to use the material within a specific period of time. In some cases, the Company bears the risk of loss for the inventory because Modine is required to insure the inventory against damage and/or theft. This inventory is included within the Company’s consolidated balance sheets as raw materials inventory. ​ The Company has entered into purchase commitments for information technology services, primarily related to implementation and support for cloud infrastructure, data analytics, and AI-enablement services. In total, the Company expects to spend approximately $ 30.0 million in connection with these purchase commitments from fiscal 2027 through fiscal 2030. ​ Note 16: Leases The Company determines if an arrangement is a lease at contract inception. The lease term begins upon lease commencement, which is when the Company takes possession of the asset, and may include options to extend or terminate the lease when it is reasonably certain that such options will be exercised. The Company uses the lease term within its determination of the appropriate lease classification, either as an operating lease or as a finance lease, and to calculate straight-line lease expense for its operating leases. ​ 80 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The Company recognizes ROU assets and lease liabilities at the lease commencement date, based upon the present value of lease payments over the lease term. As its lease agreements typically do not provide an implicit interest rate, the Company primarily uses its incremental borrowing rate to calculate the ROU asset and lease liability. In determining the incremental borrowing rate, the Company considers its current collateralized borrowing rate, the term of the lease, and the economic environment where the lease activity is concentrated. The Company believes this method effectively estimates a borrowing rate that it could obtain for a debt instrument with similar terms as the lease agreement. Based upon its accounting policy, the Company does not separate lease and non-lease components for any asset class. In addition, the Company does not record short-term leases (i.e. leases with an initial term of 12 months or less) on its consolidated balance sheets. Certain leases require the Company to pay taxes, insurance, maintenance, and other operating expenses associated with the leased asset. Such amounts are not included in the measurement of the lease liability to the extent they are variable in nature. These variable lease costs are recognized as variable lease expense when incurred. The depreciable life of the ROU assets and related leasehold improvements are limited by the expected lease term, unless the lease contains a provision to transfer title to the Company or a purchase option that the Company expects to execute. The Company’s most significant leases represent leases of real estate, such as manufacturing facilities, warehouses, and offices. In addition, the Company leases manufacturing and IT equipment and vehicles. The Company’s most significant leases have remaining lease terms of 1 to 10 years . Certain leases contain renewal options for varying periods, which are at the Company’s discretion. If reasonably certain of exercise, the Company includes the renewal periods within the calculation of ROU assets and lease liabilities. The Company’s lease agreements do not contain material residual value guarantees or material restrictive covenants. Lease assets and liabilities The following table provides a summary of leases recorded on the consolidated balance sheets. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance Sheet Location ​ ​ ​ March 31, 2026 ​ ​ ​ March 31, 2025 Lease Assets ​ ​ ​ ​ ​ Operating lease ROU assets Other noncurrent assets ​ $ 138.9 ​ $ 97.2 Finance lease ROU assets (a) Property, plant and equipment - net ​ 6.6 ​ 6.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease Liabilities ​ ​ ​ ​ ​ Operating lease liabilities Other current liabilities ​ $ 26.3 ​ $ 18.0 Operating lease liabilities Other noncurrent liabilities ​ 117.5 ​ 80.6 Finance lease liabilities Long-term debt - current portion ​ 0.5 ​ 0.5 Finance lease liabilities Long-term debt ​ 1.8 ​ 2.2 ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Finance lease ROU assets were recorded net of accumulated amortization of $ 4.8 million and $ 4.2 million as of March 31, 2026 and 2025, respectively. The increases in operating lease ROU assets and liabilities in fiscal 2026 primarily resulted from the commencement of new manufacturing facility leases within the Climate Solutions segment. The Company is increasing its production capacity to support organic growth opportunities within its Data Centers business. 81 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Components of lease expense The Company records operating lease expense as either cost of sales or SG&A expenses within its consolidated statements of operations, depending upon the nature and use of the ROU assets. The Company records finance lease expense as depreciation expense within cost of sales or SG&A expenses, depending upon the nature and use of the ROU assets, and as interest expense in its consolidated statements of operations. The components of lease expense were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Operating lease expense (a) ​ $ 46.5 ​ $ 31.9 ​ $ 24.2 Finance lease expense: ​ ​ ​ ​ ​ ​ Depreciation of ROU assets ​ 0.6 ​ 0.6 ​ 0.5 Interest on lease liabilities ​ 0.1 ​ 0.1 ​ 0.1 Total lease expense ​ $ 47.2 ​ $ 32.6 ​ $ 24.8 ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) During fiscal 2026, 2025 and 2024, operating lease expense included short-term lease expense of $ 12.0 million, $ 7.3 million, and $ 5.4 million, respectively. Variable lease expense was not significant. Supplemental cash flow information ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Cash paid for amounts included in the measurement of lease liabilities: ​ ​ ​ ​ ​ ​ Operating cash flows for operating leases ​ $ 27.6 ​ $ 22.4 ​ $ 16.9 Financing cash flows for finance leases ​ 0.7 ​ 0.6 ​ 0.5 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ROU assets obtained in exchange for lease liabilities: ​ ​ ​ ​ ​ ​ Operating leases ​ $ 54.2 ​ $ 42.2 ​ $ 29.2 Finance leases ​ — ​ 0.9 ​ — ​ Lease term and discount rates ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2026 ​ ​ ​ March 31, 2025 Weighted-average remaining lease term: ​ ​ ​ Operating leases 6.3 years 6.6 years ​ Finance leases 5.7 years 6.3 years ​ ​ ​ ​ ​ ​ ​ Weighted-average discount rate: ​ ​ ​ Operating leases 5.6 % 5.4 % Finance leases 4.8 % 4.8 % ​ ​ ​ ​ ​ ​ 82 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Maturity of lease liabilities Future minimum lease payments for leases with initial non-cancellable lease terms in excess of one year were as follows at March 31, 2026: ​ ​ ​ ​ ​ ​ ​ Fiscal Year ​ ​ ​ Operating Leases ​ ​ ​ Finance Leases 2027 ​ $ 33.6 ​ $ 0.6 2028 ​ 31.4 ​ 0.6 2029 ​ 23.2 ​ 0.6 2030 ​ 23.4 ​ 0.1 2031 ​ 18.8 ​ 0.1 2032 and beyond ​ 41.2 ​ 0.6 Total lease payments ​ 171.6 ​ 2.6 Less: Interest ​ ( 27.8 ) ​ ( 0.3 ) Present value of lease liabilities ​ $ 143.8 ​ $ 2.3 ​ ​ Note 17: Indebtedness In July 2025, the Company executed an amended and restated credit agreement with a syndicate of banks for a multi-currency $ 400.0 million revolving credit facility and a $ 200.0 million term loan facility maturing in July 2030. In addition, the credit agreement provides for shorter-duration swingline loans. This credit agreement modified the Company’s then existing revolving credit and term loan facilities, which would have matured in October 2027. In connection with the credit agreement modification, the Company incurred $ 2.3 million of debt issuance costs, which will be amortized as interest expense over the term of the debt. In December 2025, the Company further amended the credit agreement primarily to increase the borrowing capacity under the revolving credit facility by $ 150.0 million to $ 550.0 million. ​ Long-term debt consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ of maturity ​ March 31, 2026 ​ March 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Term loans ​ 2031 ​ $ 195.0 ​ $ 193.7 Revolving credit facility ​ 2031 ​ ​ 150.0 ​ ​ 30.0 5.9 % Senior Notes ​ 2029 ​ 75.0 ​ 100.0 5.8 % Senior Notes ​ 2027 ​ 8.3 ​ 16.7 Finance lease obligations ​ ​ ​ ​ 2.3 ​ 2.7 ​ ​ ​ ​ ​ 430.6 ​ 343.1 Less: current portion ​ ​ ​ ​ ( 43.9 ) ​ ( 44.8 ) Less: unamortized debt issuance costs ​ ​ ​ ​ ( 1.8 ) ​ ( 1.6 ) Total long-term debt ​ ​ ​ ​ $ 384.9 ​ $ 296.7 ​ Long-term debt, including the current portion of long-term debt, matures as follows: ​ ​ ​ ​ Fiscal Year ​ ​ ​ ​ ​ 2027 ​ $ 43.9 2028 ​ 35.6 2029 ​ 35.5 2030 ​ 10.1 2031 ​ 305.1 2032 and beyond ​ ​ 0.4 Total ​ $ 430.6 ​ 83 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Borrowings under the revolving credit, swingline and term loan facility bear interest at variable rates, based upon the applicable reference rate and including a margin percentage dependent upon the Company’s leverage ratio, as described below. At March 31, 2026, the weighted-average interest rate for revolving credit facility borrowings and the term loan was 5.0 and 5.1 percent, respectively. Based upon the terms of the credit agreement, the Company classifies borrowings under its revolving credit and swingline facilities as long-term and short-term debt, respectively, on its consolidated balance sheets. At March 31, 2026, the Company’s borrowings under its revolving credit facility and swingline facilities totaled $ 150.0 million and $ 2.5 million, respectively, and domestic letters of credit totaled $ 6.1 million. As a result, available borrowing capacity under the Company’s revolving credit facility was $ 391.4 million as of March 31, 2026. At March 31, 2025, the Company had no borrowings under the swingline facility and $ 30.0 million of borrowings under the revolving credit facility. In addition, short-term debt as of March 31, 2026 includes $ 5.0 million of overdraft borrowings in the U.S. The Company also maintains credit agreements for its foreign subsidiaries. The outstanding short-term borrowings related to these foreign credit agreements totaled $ 9.3 million at March 31, 2025. There were no short-term borrowings related to these agreements at March 31, 2026. Indebtedness under the Company’s credit agreement and Senior Notes is secured by liens on substantially all domestic assets, excluding real estate. These agreements require compliance with various covenants that may limit the Company’s ability to incur additional indebtedness; grant liens; make investments, loans, or guarantees; engage in certain transactions with affiliates; and make restricted payments, including dividends. In addition, the agreements may require prepayment in the event of certain asset sales. Financial covenants within its credit agreements include a leverage ratio, which requires the Company to limit its consolidated indebtedness, less a portion of its cash balances, both as defined by the credit agreements, to no more than three and one-half times consolidated net earnings before interest, taxes, depreciation, amortization, and certain other adjustments (“Adjusted EBITDA”). The Company must also maintain a ratio of Adjusted EBITDA of at least three times consolidated interest expense. As of March 31, 2026, the Company was in compliance with its debt covenants. The Company estimates the fair value of long-term debt using discounted future cash flows at rates offered to the Company for similar debt instruments of comparable maturities. As of March 31, 2026 and 2025, the carrying value of the Company’s long-term debt approximated fair value, with the exception of the Senior Notes, which had an aggregate fair value of approximately $ 83.7 million and $ 116.6 million, respectively. The fair value of the Company’s long-term debt is categorized as Level 2 within the fair value hierarchy. Refer to Note 4 for the definition of a Level 2 fair value measurement. ​ Cash payments for interest during fiscal 2026, 2025 and 2024, totaled $ 30.2 million, $ 26.0 million, and $ 23.3 million, respectively. ​ ​ Note 18: Pension and Employee Benefit Plans Defined contribution employee benefit plans The Company maintains a domestic 401(k) plan that allows employees to contribute a portion of their salary to help them save for retirement. The Company currently matches employee contributions up to 4.5 percent of their compensation. The Company’s expense for defined contribution employee benefit plans during fiscal 2026, 2025 and 2024 was $ 10.6 million, $ 9.3 million, and $ 8.3 million, respectively. In addition, the Company maintains non-qualified deferred compensation plans for eligible employees, and various non-U.S. subsidiaries have government-required defined contribution plans in place, under which they contribute a percentage of employee earnings into accounts, consistent with local laws. 84 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Statutory termination plans Certain non-U.S. subsidiaries have statutory termination indemnity plans covering eligible employees. The benefits under these plans are based upon years of service and final average compensation levels or a monthly retirement benefit amount. These programs are substantially unfunded in accordance with local laws. Pension plans During fiscal 2026, the Company completed the termination of its primary U.S. pension plan. The Company contributed $ 14.9 million to fully fund the plan and settled all future obligations under it through a combination of lump-sum payments to participants and the purchase of irrevocable annuity contracts. As a result, the Company recorded a non-cash pension termination charge of $ 116.1 million during fiscal 2026 to recognize actuarial losses that were previously included within accumulated other comprehensive loss on its consolidated balance sheet. Prior to the plan termination in fiscal 2026, the U.S. plan covered most domestic employees hired on or before December 31, 2003 and provided benefits based primarily upon years of service and average compensation for salaried and some hourly employees. Certain non-U.S. subsidiaries of the Company have legacy defined benefit plans which cover a small number of active employees and are substantially unfunded. The primary non-U.S. plans are maintained in Germany and Italy and are closed to new participants. The Company previously maintained pension plans in Germany that conveyed to the buyer of the Germany automotive businesses during fiscal 2024; see Note 2 for additional information. As described above, the Company contributed $ 14.9 million to its U.S. pension plan during fiscal 2026. The Company contributed $ 6.5 million and $ 0.9 million to its U.S. pension plans during fiscal 2025 and 2024, respectively. In addition, the Company contributed $ 1.3 million, $ 1.1 million, and $ 1.8 million to its non-U.S. pension plans during fiscal 2026, 2025 and 2024, respectively. These contributions are reported within the change in other liabilities in the consolidated statements of cash flows. Postretirement plans The Company provides selected healthcare and life insurance benefits for eligible retired domestic employees. The Company periodically amends these unfunded plans to change the contribution rate of retirees and the amounts and forms of coverage. An annual limit on the Company’s cost is defined for the majority of these plans. The Company’s net periodic income for its postretirement plans in fiscal 2026, 2025 and 2024 was $ 0.3 million, $ 0.3 million, and $ 0.4 million, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ 85 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Measurement date The Company uses March 31 as the measurement date for its pension and postretirement plans. Changes in benefit obligations and plan assets, as well as the funded status of the Company’s global pension plans, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Change in benefit obligation: ​ ​ ​ ​ Benefit obligation at beginning of year ​ $ 181.1 ​ $ 179.3 Service cost ​ 0.2 ​ 0.2 Interest cost ​ 6.5 ​ 9.0 Actuarial (gain) loss ​ ( 6.4 ) ​ 6.5 Benefits paid ​ ( 13.7 ) ​ ( 14.0 ) Pension termination settlement ​ ( 156.1 ) ​ — Effect of exchange rate changes ​ 0.7 ​ 0.1 Benefit obligation at end of year ​ $ 12.3 ​ $ 181.1 ​ ​ ​ ​ ​ ​ ​ Change in plan assets: ​ ​ ​ ​ Fair value of plan assets at beginning of year ​ $ 150.8 ​ $ 150.5 Actual return on plan assets ​ 2.8 ​ 6.7 Benefits paid ​ ( 13.7 ) ​ ( 14.0 ) Pension termination settlement ​ ​ ( 156.1 ) ​ ​ — Employer contributions ​ 16.2 ​ 7.6 Fair value of plan assets at end of year ​ $ — ​ $ 150.8 Funded status at end of year ​ $ ( 12.3 ) ​ $ ( 30.3 ) ​ ​ ​ ​ ​ ​ ​ Amounts recognized in the consolidated balance sheets: ​ ​ ​ ​ Current liability ​ $ ( 0.9 ) ​ $ ( 0.9 ) Noncurrent liability ​ ( 11.4 ) ​ ( 29.4 ) ​ ​ $ ( 12.3 ) ​ $ ( 30.3 ) ​ As of March 31, 2026, 2025 and 2024, the benefit obligation associated with the Company’s non-U.S. pension plans totaled $ 11.7 million, $ 11.8 million, and $ 13.0 million, respectively. The $ 0.1 million decrease in the benefit obligation associated with non-U.S. pension plans as of March 31, 2026, compared with the prior year, was primarily due to employer contributions of $ 1.3 million and net actuarial gains during the year totaling $ 0.5 million, partially offset by service and interest cost totaling $ 0.7 million and the impact of foreign currency exchange rates. In fiscal 2025, the $ 1.2 million decrease was primarily due to employer contributions and net actuarial gains during the year totaling $ 2.0 million, partially offset by service and interest cost totaling $ 0.6 million. The accumulated benefit obligation for pension plans was $ 11.9 million and $ 180.2 million as of March 31, 2026 and 2025, respectively. As of March 31, 2026, these pension plans had a net actuarial gain of $ 0.5 million recognized in accumulated other comprehensive loss, compared with a net actuarial loss of $ 122.0 million as of March 31, 2025. The changes were driven by the aforementioned U.S. pension plan termination in fiscal 2026. 86 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Costs for the Company’s global pension plans included the following components: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Components of net periodic benefit cost: ​ ​ ​ ​ ​ ​ Service cost ​ $ 0.2 ​ $ 0.2 ​ $ 0.2 Interest cost ​ 6.5 ​ 9.0 ​ 9.3 Expected return on plan assets ​ ( 5.8 ) ​ ( 8.7 ) ​ ( 10.3 ) Amortization of unrecognized net loss ​ 3.2 ​ 4.7 ​ 4.7 Settlements (a) ​ ( 0.1 ) ​ ( 0.1 ) ​ ( 0.1 ) Pension termination charge (b) ​ ​ 116.1 ​ ​ — ​ ​ — Net periodic benefit cost ​ $ 120.1 ​ $ 5.1 ​ $ 3.8 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other changes in benefit obligation recognized in other comprehensive income: ​ ​ ​ ​ ​ ​ Net actuarial gain (loss) ​ $ 3.2 ​ $ ( 8.7 ) ​ $ 1.7 Amortization of net actuarial loss (c) ​ 3.1 ​ 4.6 ​ 3.9 Pension termination charge (b) ​ ​ 116.1 ​ ​ — ​ ​ — Total recognized in other comprehensive income (loss) ​ $ 122.4 ​ $ ( 4.1 ) ​ $ 5.6 ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) The settlement charges resulted from activity associated with the Company’s non-U.S. pension plans. (b) The Company recognized $ 116.1 million of net actuarial losses during fiscal 2026 related to the termination of its primary U.S. pension plan. (c) The fiscal 2024 amount includes $ 0.6 million of net actuarial gains written-off as a result of the sale of the Germany automotive businesses. See Note 2 for additional information on the sale of these businesses. The Company used a discount rate of 5.6 % and 5.5 % as of March 31, 2026 and 2025, respectively, for determining its benefit obligations under its U.S. pension plans. The Company used a weighted-average discount rate of 4.5 % and 4.0 % as of March 31, 2026 and 2025, respectively, for determining its benefit obligations under its non-U.S. pension plans. The Company used a discount rate of 5.5 %, 5.4 %, and 5.2 % to determine its costs under its U.S. pension plans for fiscal 2026, 2025 and 2024, respectively. The Company used a weighted-average discount rate of 4.2 %, 3.9 %, and 4.0 % to determine its costs under its non-U.S. pension plans for fiscal 2026, 2025 and 2024, respectively. The Company determined the discount rates used for its U.S. pension plans by modeling a portfolio of high-quality corporate bonds, with appropriate consideration given to expected defined benefit payment terms and duration of the respective pension obligations. The Company used a similar process to determine the discount rate for its non-U.S. pension obligations. Historically, prior to its termination, the primary U.S. pension plan held 100 percent of the Company’s world-wide pension plan assets. During the last three fiscal years, the Company’s pension plans did not directly own shares of Modine common stock. The Company’s U.S. pension plan weighted-average asset allocations at the measurement date of March 31, 2025 were as follows: ​ ​ ​ ​ Debt securities 97 % Cash and cash equivalents 3 % ​ 100 % ​ The expected rate of return on U.S. plan assets is based upon historical return experience and forward-looking return expectations for major asset class categories. For fiscal 2026 U.S. pension plan expense, prior to the termination of the plan, the expected rate of return on plan assets was 5.5 percent. For fiscal 2025 and 2024 U.S. pension plan expense, the expected rate of return on plan assets was 5.5 percent and 6.5 percent, respectively. 87 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Estimated pension benefit payments for the Company’s global pension plans are shown below. ​ ​ ​ ​ ​ ​ ​ ​ Estimated Pension Fiscal Year Benefit Payments 2027 ​ $ 1.1 2028 ​ 1.0 2029 ​ 1.0 2030 ​ 1.0 2031 ​ 1.1 2032-2036 ​ 5.2 ​ ​ Note 19: Derivative Instruments The Company uses derivative financial instruments from time to time as a tool to manage certain financial risks. The Company’s policy prohibits the use of leveraged derivatives. Accounting for derivatives and hedging activities requires derivative financial instruments to be measured at fair value and recognized as assets or liabilities in the consolidated balance sheets. All of the Company’s derivative financial instruments are categorized within Level 2 of the fair value hierarchy. Refer to Note 4 for the definition of a Level 2 fair value measurement. Accounting for the gain or loss resulting from the change in fair value of the derivative financial instruments depends on whether it has been designated as a hedge, and, if so, on the nature of the hedging activity. Commodity derivatives The Company periodically enters into over-the-counter forward contracts related to forecasted purchases of aluminum and copper. The Company’s strategy in entering into these contracts is to reduce its exposure to changing market prices of these commodities. The Company designates certain commodity forward contracts as cash flow hedges for accounting purposes. Accordingly, for these designated hedges, the Company records unrealized gains and losses related to the change in the fair value of the contracts in accumulated other comprehensive income (loss) (“AOCI”) within shareholders’ equity and subsequently recognizes the gains and losses within cost of sales as the underlying inventory is sold. Foreign exchange contracts The Company’s foreign exchange risk management strategy uses derivative financial instruments to mitigate foreign currency exchange risk. The Company periodically enters into foreign currency forward contracts to hedge specific foreign currency-denominated assets and liabilities as well as forecasted transactions. The Company designates certain hedges of forecasted transactions as cash flow hedges for accounting purposes. Accordingly, for these designated hedges, the Company records unrealized gains and losses related to the change in the fair value of the contracts in AOCI within shareholders’ equity and subsequently recognizes the gains and losses as a component of earnings at the same time and in the same financial statement line that the underlying transactions impact earnings. The Company has not designated forward contracts related to foreign currency-denominated assets and liabilities as hedges. Accordingly, for these non-designated contracts, the Company records unrealized gains and losses related to changes in fair value in other income and expense. Gains and losses on these foreign currency contracts are offset by foreign currency gains and losses associated with the related assets and liabilities. ​ ​ ​ 88 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The fair value of the Company’s derivative financial instruments recorded in the consolidated balance sheets were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance Sheet Location ​ ​ ​ March 31, 2026 ​ ​ ​ March 31, 2025 Derivatives designated as hedges: ​ ​ ​ ​ ​ Commodity derivatives Other current assets ​ $ 0.2 ​ $ 0.1 Foreign exchange contracts Other current liabilities ​ ​ — ​ ​ 0.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ Derivatives not designated as hedges: ​ ​ ​ ​ ​ Foreign exchange contracts Other current liabilities ​ $ 0.4 ​ $ 0.4 ​ ​ The amounts associated with derivative financial instruments that the Company designated for hedge accounting during the years ended March 31 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gain (loss) recognized in ​ Statement of ​ Gain (loss) reclassified ​ ​ other comprehensive income ​ Operations ​ from AOCI ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ Location ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Commodity derivatives ​ $ 0.3 ​ $ 0.2 ​ $ ( 0.3 ) ​ Cost of sales ​ $ 0.3 ​ $ — ​ $ ( 0.3 ) Foreign exchange contracts ​ 0.2 ​ ( 0.8 ) ​ 0.3 ​ Net sales ​ ( 0.5 ) ​ 0.1 ​ 1.3 Foreign exchange contracts ​ ( 0.1 ) ​ ( 0.3 ) ​ 0.1 ​ Cost of sales ​ ( 0.4 ) ​ — ​ — Total gains (losses) ​ $ 0.4 ​ $ ( 0.9 ) ​ $ 0.1 ​ ​ ​ ​ $ ( 0.6 ) ​ $ 0.1 ​ $ 1.0 ​ The amounts associated with derivative financial instruments that the Company did not designate for hedge accounting were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Statement of Operations ​ Years ended March 31, ​ ​ ​ ​ Location ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Foreign exchange contracts ​ Net sales ​ $ ( 0.1 ) ​ $ — ​ $ ( 0.9 ) Foreign exchange contracts ​ Other income (expense) – net ​ 1.9 ​ ( 2.4 ) ​ ( 1.0 ) Total gains (losses) ​ ​ ​ ​ $ 1.8 ​ $ ( 2.4 ) ​ $ ( 1.9 ) ​ ​ Note 20: Risks, Uncertainties, Contingencies and Litigation Credit risk The Company invests excess cash primarily in investment quality, short-term liquid debt instruments. Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of accounts receivable. The Company sells a broad range of products that provide thermal solutions to customers operating throughout the world. In fiscal 2026, one global technology customer within the Climate Solutions segment accounted for approximately 11 percent of the Company’s total sales. In fiscal 2025 and 2024, no customers accounted for more than ten percent of the Company’s total sales. Sales to the Company’s top ten customers were 49 percent, 43 percent, and 40 percent of total sales in fiscal 2026, 2025 and 2024, respectively. At March 31, 2026 and 2025, 53 percent and 43 percent, respectively, of the Company’s trade accounts receivable were due from the Company’s top ten customers. These customers operate primarily in the data center, commercial vehicle, off-highway, commercial air conditioning and refrigeration, and automotive and light vehicle markets. The Company generally does not require collateral or advanced payments from its customers. The Company has not experienced significant credit losses to customers in the markets served. 89 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The Company manages credit risk through its focus on the following: ● Cash and cash equivalents – maintaining cash and short-term deposits with financial institutions with reputable credit ratings; ● Accounts receivable – performing periodic customer credit evaluations and actively monitoring their financial condition and applicable business news; and ● Insurance – ensuring that insurance providers maintain financial ratings that are acceptable to the Company. Counterparty risk The Company manages counterparty risk through its focus on the following: ● Customers – performing thorough reviews of customer credit reports and accounts receivable aging reports by internal credit committees; ● Suppliers – maintaining a supplier risk management program and utilizing industry sources to identify and mitigate high risk situations; and ● Derivatives – ensuring that counterparties to derivative instruments maintain credit ratings that are acceptable to the Company. Environmental The Company has recorded environmental monitoring and remediation accruals related to manufacturing facilities in the U.S., one of which the Company currently owns and operates, and at its former manufacturing facility in the Netherlands. These accruals primarily relate to soil and groundwater contamination at facilities where past operations followed practices and procedures that were considered acceptable under then-existing regulations, or where the Company is a successor to the obligations of prior owners, and current laws and regulations require investigative and/or remedial work to ensure sufficient environmental compliance. In instances where a range of loss can be reasonably estimated for a probable environmental liability, but no amount within the range is a better estimate than any other amount, the Company accrues the minimum of the range. The Company’s accruals for environmental matters totaled $ 12.7 million and $ 15.8 million at March 31, 2026 and 2025, respectively. As additional information becomes available regarding environmental matters, the Company will re-assess the liabilities and revise the estimated accruals, if necessary. While it is possible that the ultimate environmental remediation costs may be in excess of amounts accrued, the Company believes, based upon currently available information, that the ultimate outcome of these matters, individually and in the aggregate, will not have a material adverse effect on its financial position. However, these matters are subject to inherent uncertainties, and unfavorable outcomes could occur, including significant monetary damages. Other litigation In the normal course of business, the Company and its subsidiaries are named as defendants in various lawsuits and enforcement proceedings by private parties, governmental agencies and/or others in which claims are asserted against Modine. The Company believes that any additional loss in excess of amounts already accrued would not have a material effect on the Company’s consolidated balance sheet, results of operations, and cash flows. In addition, management expects that the liabilities which may ultimately result from such lawsuits or proceedings, if any, would not have a material adverse effect on the Company’s financial position. ​ ​ ​ ​ ​ ​ ​ 90 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 21: Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreign ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Currency ​ Defined ​ Cash Flow ​ ​ ​ ​ Translation ​ Benefit Plans ​ Hedges ​ Total Balance March 31, 2023 ​ $ ( 57.5 ) ​ $ ( 104.4 ) ​ ​ ​ $ 0.8 ​ ​ ​ $ ( 161.1 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) before reclassifications ​ ( 5.3 ) ​ 1.8 ​ 0.1 ​ ( 3.4 ) Reclassifications: ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unrecognized net loss (a) ​ — ​ 4.1 ​ — ​ 4.1 Realized gains - net (b) ​ — ​ — ​ ( 1.0 ) ​ ( 1.0 ) Unrecognized net pension gain in disposed businesses (c) ​ ​ — ​ ( 0.6 ) ​ — ​ ( 0.6 ) Income taxes ​ — ​ ( 1.6 ) ​ 0.2 ​ ( 1.4 ) Total other comprehensive income (loss) ​ ( 5.3 ) ​ 3.7 ​ ( 0.7 ) ​ ( 2.3 ) Balance March 31, 2024 ​ $ ( 62.8 ) ​ $ ( 100.7 ) ​ $ 0.1 ​ $ ( 163.4 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) before reclassifications ​ ( 14.0 ) ​ ( 8.7 ) ​ ( 0.9 ) ​ ( 23.6 ) Reclassifications: ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unrecognized net loss (a) ​ — ​ 4.2 ​ — ​ 4.2 Realized gains - net (b) ​ — ​ — ​ ( 0.1 ) ​ ( 0.1 ) Income taxes ​ — ​ 1.4 ​ 0.2 ​ 1.6 Total other comprehensive income (loss) ​ ( 14.0 ) ​ ( 3.1 ) ​ ( 0.8 ) ​ ( 17.9 ) Balance March 31, 2025 ​ ​ ​ $ ( 76.8 ) ​ ​ ​ $ ( 103.8 ) ​ ​ ​ $ ( 0.7 ) ​ ​ ​ $ ( 181.3 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income (loss) before reclassifications ​ 35.8 ​ 3.3 ​ 0.4 ​ 39.5 Reclassifications: ​ ​ ​ ​ ​ ​ ​ ​ Amortization of unrecognized net loss (a) ​ — ​ 2.8 ​ — ​ 2.8 Pension termination charge (d) ​ — ​ 116.1 ​ — ​ 116.1 Realized losses - net (b) ​ — ​ — ​ 0.6 ​ 0.6 Income taxes (e) ​ — ​ ( 14.6 ) ​ ( 0.2 ) ​ ( 14.8 ) Total other comprehensive income (loss) ​ 35.8 ​ 107.6 ​ 0.8 ​ 144.2 Balance March 31, 2026 ​ $ ( 41.0 ) ​ $ 3.8 ​ $ 0.1 ​ $ ( 37.1 ) ____ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Amounts are included in the calculation of net periodic benefit cost for the Company’s defined benefit plans, which include pension and other postretirement plans. See Note 18 for additional information about the Company’s pension plans. (b) Amounts represent net gains and losses associated with cash flow hedges that were reclassified to net earnings. See Note 19 for additional information regarding derivative instruments. (c) As a result of the sale of three automotive businesses based in Germany, the Company wrote-off $ 0.6 million of net actuarial gains related to the disposal group’s pension plan. See Note 2 for additional information regarding the sale. (d) During fiscal 2026, the Company recognized $ 116.1 million of net actuarial losses related to the termination of its primary U.S. pension plan. See Note 18 for additional information. (e) Income taxes related to defined benefit plans include a $ 13.1 million benefit related to the pension termination charge described above. See Note 8 for additional information. ​ ​ ​ ​ ​ 91 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ Note 22: Segment and Geographic Information The Company’s Climate Solutions segment provides energy-efficient, safe, climate-controlled solutions and components for a wide range of critical applications. The Climate Solutions segment sells data center products, heat transfer solutions, and HVAC technologies products to customers in North America, EMEA, and Asia. The Company’s Performance Technologies segment designs and manufactures heat exchangers and cooling systems for heavy-duty equipment and on-highway applications. In addition, the Performance Technologies segment sells cooling module generator sets that provide mission-critical stationary power. See Note 3 for additional information regarding net sales by product groups within each segment. The Company’s chief operating decision maker (“CODM”), its President and Chief Executive Officer, reviews the separate financial results for each of its operating segments. The CODM uses segment operating income as a measure of profit and loss to evaluate the financial performance of each segment and as a basis for allocating company resources. ​ Effective April 1, 2026, the Company reorganized its Climate Solutions segment and split it into two separate operating segments: 1) Data Centers and 2) Commercial HVAC. The Company believes that managing these businesses independently will allow it to better deploy its 80/20 strategy focused on capitalizing on growth opportunities, particularly in the Data Centers business, and optimizing profit margins and cash flow. Beginning for fiscal 2027, the Company will report three operating segments: 1) Data Centers; 2) Commercial HVAC and 3) Performance Technologies. The tables below present net sales and significant expense categories for the Company’s operating segments that are regularly provided to the CODM. Net sales for Corporate and eliminations primarily represent the elimination of inter-segment sales. Inter-segment sales are accounted for based upon an established markup over production costs. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2026 ​ ​ ​ ​ Climate ​ Performance ​ ​ ​ Corporate and ​ ​ ​ ​ ​ ​ Solutions ​ Technologies ​ eliminations ​ Total External sales ​ $ 2,055.4 ​ $ 1,125.7 ​ $ — ​ $ 3,181.1 Inter-segment sales ​ 6.9 ​ 6.1 ​ ( 13.0 ) ​ — Net sales ​ 2,062.3 ​ 1,131.8 ​ ( 13.0 ) ​ 3,181.1 Cost of sales ​ 1,538.3 ​ ​ 927.0 ​ ​ ( 15.3 ) ​ 2,450.0 Gross profit ​ ​ 524.0 ​ ​ 204.8 ​ ​ 2.3 ​ ​ 731.1 Selling, general and administrative expenses ​ ​ 194.4 ​ ​ 79.1 ​ ​ 86.6 ​ ​ 360.1 Restructuring expenses ​ ​ 8.5 ​ ​ 11.9 ​ ​ 0.2 ​ ​ 20.6 Impairment charge ​ ​ — ​ ​ 4.1 ​ ​ — ​ ​ 4.1 Loss on sale of assets ​ ​ — ​ ​ — ​ ​ 3.9 ​ ​ 3.9 Operating income ​ $ 321.1 ​ $ 109.7 ​ $ ( 88.4 ) ​ $ 342.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2025 ​ ​ ​ ​ Climate ​ Performance ​ ​ ​ Corporate and ​ ​ ​ ​ ​ ​ Solutions ​ Technologies ​ eliminations ​ Total External sales ​ $ 1,440.6 ​ $ 1,142.9 ​ $ — ​ $ 2,583.5 Inter-segment sales ​ 0.2 ​ 20.6 ​ ( 20.8 ) ​ — Net sales ​ 1,440.8 ​ 1,163.5 ​ ( 20.8 ) ​ 2,583.5 Cost of sales ​ 1,024.7 ​ ​ 933.1 ​ ​ ( 18.1 ) ​ 1,939.7 Gross profit ​ ​ 416.1 ​ ​ 230.4 ​ ​ ( 2.7 ) ​ ​ 643.8 Selling, general and administrative expenses ​ ​ 161.7 ​ ​ 101.9 ​ ​ 68.5 ​ ​ 332.1 Restructuring expenses ​ ​ 6.0 ​ ​ 20.5 ​ ​ 1.7 ​ ​ 28.2 Operating income ​ $ 248.4 ​ $ 108.0 ​ $ ( 72.9 ) ​ $ 283.5 ​ ​ 92 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended March 31, 2024 ​ ​ ​ ​ Climate ​ Performance ​ ​ ​ Corporate and ​ ​ ​ ​ ​ ​ Solutions ​ Technologies ​ eliminations ​ Total External sales ​ $ 1,108.1 ​ $ 1,299.7 ​ $ — ​ $ 2,407.8 Inter-segment sales ​ — ​ 21.6 ​ ( 21.6 ) ​ — Net sales ​ 1,108.1 ​ 1,321.3 ​ ( 21.6 ) ​ 2,407.8 Cost of sales ​ 811.2 ​ ​ 1,091.7 ​ ​ ( 20.7 ) ​ 1,882.2 Gross profit ​ ​ 296.9 ​ ​ 229.6 ​ ​ ( 0.9 ) ​ ​ 525.6 Selling, general and administrative expenses ​ ​ 115.3 ​ ​ 105.9 ​ ​ 52.7 ​ ​ 273.9 Restructuring expenses ​ ​ 3.0 ​ ​ 12.0 ​ ​ — ​ ​ 15.0 Gain on sale of assets ​ ​ — ​ ​ — ​ ​ ( 4.0 ) ​ ​ ( 4.0 ) Operating income ​ $ 178.6 ​ $ 111.7 ​ $ ( 49.6 ) ​ $ 240.7 ​ SG&A expenses at Corporate include legal, finance, general corporate and central services expenses and other costs that are either not directly attributable to an operating segment or not considered when the CODM evaluates segment performance. ​ The following is a summary of segment assets, comprised entirely of trade accounts receivable and inventories, and other assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 Assets: ​ ​ ​ ​ ​ ​ Climate Solutions ​ $ 834.5 ​ $ 448.7 Performance Technologies ​ 402.6 ​ 371.1 Other (a) ​ 1,437.5 ​ 1,097.8 Total assets ​ $ 2,674.6 ​ $ 1,917.6 ____ ​ ​ ​ ​ ​ ​ ​ (a) Represents cash and cash equivalents, other current assets, property plant and equipment, intangible assets, goodwill, deferred income taxes, and other noncurrent assets for the Climate Solutions and Performance Technologies segments and Corporate. The following is a summary of capital expenditures and depreciation and amortization expense by segment: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Capital expenditures: ​ ​ ​ ​ ​ ​ ​ ​ ​ Climate Solutions ​ $ 113.4 ​ $ 53.3 ​ $ 52.7 Performance Technologies ​ 28.4 ​ 30.2 ​ 34.3 Corporate ​ 1.5 ​ 0.5 ​ 0.7 Total capital expenditures ​ $ 143.3 ​ $ 84.0 ​ $ 87.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 Depreciation and amortization expense: ​ ​ ​ ​ ​ ​ ​ ​ ​ Climate Solutions ​ $ 47.5 ​ $ 48.3 ​ $ 26.5 Performance Technologies ​ 30.8 ​ 28.7 ​ 28.7 Corporate ​ 1.4 ​ 0.7 ​ 0.9 Total depreciation and amortization expense ​ $ 79.7 ​ $ 77.7 ​ $ 56.1 ​ 93 Table of Contents MODINE MANUFACTURING COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) ​ The following is a summary of net sales by geographic area, based upon the location of the selling unit: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 ​ ​ ​ 2024 United States ​ $ 1,676.9 ​ $ 1,287.5 ​ $ 1,233.7 Canada ​ ​ 332.6 ​ ​ 241.7 ​ ​ 7.9 Italy ​ 226.8 ​ 209.7 ​ 242.4 Hungary ​ 213.4 ​ 179.8 ​ 224.7 United Kingdom ​ 192.7 ​ 157.8 ​ 135.8 Other ​ 538.7 ​ 507.0 ​ 563.3 Net sales ​ $ 3,181.1 ​ $ 2,583.5 ​ $ 2,407.8 ​ The following is a summary of property, plant and equipment by geographic area: ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ ​ ​ 2026 ​ ​ ​ 2025 United States ​ $ 244.5 ​ $ 133.6 Italy ​ 44.2 ​ 39.9 Hungary ​ 40.8 ​ 38.4 Mexico ​ 39.3 ​ 36.5 China ​ 36.6 ​ 37.4 Other ​ 115.5 ​ 104.7 Total property, plant and equipment ​ $ 520.9 ​ $ 390.5 ​ ​ ​ 94 Table of Contents Report of Independent Registered Public Accounting Firm ​ To the Shareholders and Board of Directors Modine Manufacturing Company: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting We have audited the accompanying consolidated balance sheets of Modine Manufacturing Company and subsidiaries (the Company) as of March 31, 2026 and 2025, the related consolidated statements of operations, comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended March 31, 2026, and the related notes and financial statement schedule II - Valuation and Qualifying Accounts (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the years in the three-year period ended March 31, 2026, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 31, 2026 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Basis for Opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. ​ We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. ​ Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. ​ Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. ​ 95 Table of Contents Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ​ Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. ​ Acquisition date fair value of certain customer relationship intangible assets As discussed in Notes 2 and 13 to the consolidated financial statements, on May 31, 2025, the Company acquired all of the issued and outstanding shares of LBW Holding Corp. for consideration totaling $110.5 million. The Company accounts for the acquired business using the acquisition method of accounting by recording assets acquired and liabilities assumed at their respective fair values. As part of the transaction, the Company acquired customer relationship intangible assets with an acquisition date fair value of $38.5 million, which was determined using the multi-period excess earnings method. We identified the assessment of the acquisition date fair value of certain customer relationship intangible assets as a critical audit matter. Subjective auditor judgment was required to evaluate certain assumptions used to determine the acquisition date fair value, specifically, future revenue growth rates, customer attrition rate, and discount rate. Changes in these assumptions could have an impact on the forecasted future cash flows used in the multi-period excess earnings method and the resulting fair value of the customer relationship intangible assets. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s acquisition date valuation process over certain customer relationship intangible assets. This included certain controls over the development of the assumptions listed above. We evaluated future revenue growth rates and the customer attrition rate by comparing them to historical results. We involved valuation professionals with specialized skills and knowledge, who assisted us in evaluating: ● the customer attrition rate by comparing the economic life of the customer relationship to comparable industry transactions ● the discount rate by comparing it against a discount rate range that was independently developed using publicly available data for comparable entities. ​ /s/ KPMG LLP ​ We have served as the Company’s auditor since 2022. ​ Milwaukee, Wisconsin May 27, 2026 ​ ​ ​ ​ ​ ​ ​ ​ ​ 96 Table of Contents ITEM 9 . CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE . Not Applicable ​