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Product Warranties and Other Commitments

12 Months Ended

Mar. 31, 2025

Product Warranties and Other Commitments

Product Warranties and Other Commitments

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.

Changes in accrued warranty costs were as follows:


	Years ended March 31,
	2025		2024
Beginning balance	$	10.7	$	6.9
Warranties recorded at time of sale		7.3		6.6
Adjustments to pre-existing warranties		(2.2)		2.2
Settlements		(6.7)		(5.3)
Acquisition of business (a)		—		0.4
Disposition of businesses (a)		—		(0.2)
Effect of exchange rate changes		0.1		0.1
Ending balance	$	9.2	$	10.7
____

(a)	The Company acquired Scott Springfield Manufacturing during fiscal 2024. The Company sold three automotive businesses based in Germany during fiscal 2024. See Note 2 for additional information.

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, 2025 was not material.

Commitments

At March 31, 2025, the Company had capital expenditure commitments of $30.4 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.