Revenue Recognition

6 Months Ended

Sep. 30, 2022

Revenue Recognition [Abstract]

Revenue Recognition

Note 2: Revenue Recognition

Effective April 1, 2022, the Company began managing its operations under two operating segments, Climate Solutions and Performance Technologies.  The Climate Solutions segment includes the previously-reported Building HVAC Systems (“BHVAC”) and the Commercial and Industrial Solutions (“CIS”) segments, with the exception of CIS Coatings.  The Performance Technologies segment includes the previously-reported Heavy Duty Equipment (“HDE”) and Automotive segments and the CIS Coatings business.  See Note 19 for additional segment financial information.

The Company’s operating segments and their principal revenue-generating activities are as follows:

Climate Solutions

The Climate Solutions segment provides energy-efficient, climate-controlled components and solutions for a wide array of applications.  The Climate Solutions segment principally generates revenue from selling heat transfer products, heating, ventilating, air conditioning, and refrigeration (“HVAC & refrigeration”) products, and data center cooling solutions.  Heat transfer products include heat transfer coils used in commercial and residential HVAC and refrigeration applications.  HVAC and refrigeration products include commercial and residential unit heaters, vertical and horizontal unit ventilators, air conditioning chillers, low global warming potential unit coolers, air-cooled condensers, and dry coolers.  Data center cooling solutions, which are integrated with system controls, include air- and liquid-cooled chillers, computer room air conditioner and air handler units, and fan walls.

Performance Technologies

The Performance Technologies segment provides products and solutions that enhance the performance of customer applications.  The Performance Technologies segment designs and manufactures air- and liquid-cooled technology for vehicular, stationary power, and industrial applications.  Air-cooled products include radiators, charge air coolers, condensers, and engine cooling modules.  Liquid-cooled products include engine oil coolers, charge air coolers, condensers, and exhaust gas recirculation coolers.  In addition, the Performance Technologies segment provides advanced solutions, which are designed to improve battery range and vehicle life, to zero-emission and hybrid commercial vehicle and automotive customers.  These solutions include battery thermal management systems, electronics cooling packages, and battery chillers.  The advanced solutions provided by the segment also include coating products and application services that extend the life of equipment and components by protecting against corrosion.

Disaggregation of Revenue

The table below presents revenue for each of the Company’s operating segments.  Each segment’s revenue is disaggregated by product group, by geographic location and based upon the timing of revenue recognition.  The disaggregated revenue information presented in the table below for fiscal 2022 has been recast to be comparable with the fiscal 2023 presentation.

	Three months ended September 30, 2022						Three months ended September 30, 2021
	Climate Solutions		Performance Technologies		Segment Total		Climate Solutions		Performance Technologies		Segment Total
Product groups:
Heat transfer	$	134.9	$	-	$	134.9	$	119.2	$	-	$	119.2
HVAC & refrigeration		89.6		-		89.6		80.5		-		80.5
Data center cooling		31.3		-		31.3		17.3		-		17.3
Air-cooled		-		169.3		169.3		-		136.2		136.2
Liquid-cooled		-		119.0		119.0		-		97.1		97.1
Advanced solutions		-		34.7		34.7		-		28.6		28.6
Inter-segment sales		0.1		7.0		7.1		0.2		8.9		9.1
Net sales	$	255.9	$	330.0	$	585.9	$	217.2	$	270.8	$	488.0
Geographic location:
Americas	$	156.3	$	182.8	$	339.1	$	117.9	$	144.5	$	262.4
Europe		90.9		91.3		182.2		89.8		80.3		170.1
Asia		8.7		55.9		64.6		9.5		46.0		55.5
Net sales	$	255.9	$	330.0	$	585.9	$	217.2	$	270.8	$	488.0
Timing of revenue recognition:
Products transferred at a point in time	$	243.0	$	309.8	$	552.8	$	213.9	$	250.5	$	464.4
Products transferred over time		12.9		20.2		33.1		3.3		20.3		23.6
Net sales	$	255.9	$	330.0	$	585.9	$	217.2	$	270.8	$	488.0

	Six months ended September 30, 2022						Six months ended September 30, 2021
	Climate Solutions		Performance Technologies		Segment Total		Climate Solutions		Performance Technologies		Segment Total
Product groups:
Heat transfer	$	275.4	$	-	$	275.4	$	236.9	$	-	$	236.9
HVAC & refrigeration		167.8		-		167.8		151.1		-		151.1
Data center cooling		56.8		-		56.8		35.5		-		35.5
Air-cooled		-		322.3		322.3		-		277.7		277.7
Liquid-cooled		-		229.9		229.9		-		215.8		215.8
Advanced solutions		-		67.6		67.6		-		56.5		56.5
Inter-segment sales		0.3		14.5		14.8		0.2		17.9		18.1
Net sales	$	500.3	$	634.3	$	1,134.6	$	423.7	$	567.9	$	991.6
Geographic location:
Americas	$	295.7	$	347.1	$	642.8	$	221.9	$	282.8	$	504.7
Europe		189.9		187.4		377.3		185.8		184.7		370.5
Asia		14.7		99.8		114.5		16.0		100.4		116.4
Net sales	$	500.3	$	634.3	$	1,134.6	$	423.7	$	567.9	$	991.6
Timing of revenue recognition:
Products transferred at a point in time	$	473.8	$	591.6	$	1,065.4	$	417.3	$	528.1	$	945.4
Products transferred over time		26.5		42.7		69.2		6.4		39.8		46.2
Net sales	$	500.3	$	634.3	$	1,134.6	$	423.7	$	567.9	$	991.6

Contract Balances

Contract assets and contract liabilities from contracts with customers were as follows:

	September 30, 2022		March 31, 2022
Contract assets	$	25.1	$	26.8
Contract liabilities		14.6		11.8

Contract assets, included within other current assets in the consolidated balance sheets, primarily consist of capitalized costs related to customer-owned tooling contracts, wherein the customer has guaranteed reimbursement, and assets recorded for revenue recognized over time, which represent the Company’s rights to consideration for work completed but not yet billed.  The $1.7 million decrease in contract assets during the first six months of fiscal 2023 primarily resulted from a decrease in contract assets for revenue recognized over time.

Contract liabilities, included within other current liabilities in the consolidated balance sheets, consist of payments received in advance of satisfying performance obligations under customer contracts, including contracts for customer-owned tooling.  The $2.8 million increase in contract liabilities during the first six months of fiscal 2023 primarily resulted from payments received in advance of the Company’s satisfaction of performance obligations.