Press release·03/02/2025 11:28:14

Trane Technologies Delivers Strong Financial Performance in 2024

Trane Technologies, a global climate innovator, has reported impressive financial results for the year 2024. The company, known for its strategic brands Trane® and Thermo King®, has continued to drive sustainable and efficient solutions across buildings, homes, and transportation.

Overview of Financial Performance

In 2024, Trane Technologies’ net revenues increased by 12.2% to $19,838.2 million, compared to $17,677.6 million in 2023. This growth was primarily driven by higher volumes, reflecting stronger end-customer demand in the Americas and EMEA (Europe, Middle East, and Africa) segments, as well as the realization of price increases and incremental revenue from acquisitions. The company’s gross profit margin also improved, increasing by 260 basis points to 35.7% in 2024, due to gross productivity and price realization, partially offset by inflation.

Segment Performance

Trane Technologies operates in three reportable segments: Americas, EMEA, and Asia Pacific.

Americas Segment The Americas segment, which includes North America and Latin America, saw a 15.0% increase in net revenues, reaching $15,903.2 million in 2024. This growth was driven by strong demand in both the Commercial HVAC (Heating, Ventilation, and Air Conditioning) and Residential HVAC businesses, as well as the realization of price increases in the Commercial HVAC business. The segment’s Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin increased by 160 basis points to 20.9%, primarily due to price realization, gross productivity, and higher volumes, partially offset by inflation and continued business reinvestment.

EMEA Segment The EMEA segment reported a 6.5% increase in net revenues, reaching $2,556.7 million in 2024. This growth was driven by strong customer demand in the Commercial HVAC business and the realization of price increases in both the Commercial HVAC and Transport Refrigeration businesses. The segment’s Adjusted EBITDA margin increased by 40 basis points to 19.8%, primarily due to favorable productivity and price, partially offset by inflation, continued business reinvestment, and a loss from the devaluation of the Egyptian pound.

Asia Pacific Segment The Asia Pacific segment experienced a 4.6% decrease in net revenues, reaching $1,378.3 million in 2024. This decline was primarily driven by lower volumes in China, partially offset by the realization of price increases in the Commercial HVAC business and higher volumes in the rest of Asia. The segment’s Adjusted EBITDA margin increased by 170 basis points to 23.9%, primarily due to gross productivity and price realization, partially offset by lower volumes, inflation, and continued business reinvestment.

Strengths and Weaknesses

Strengths:

• Diversified product portfolio and geographic presence: Trane Technologies’ broad range of products and services, as well as its global footprint, have helped mitigate the impact of any single industry or economy on its consolidated operating results.
• Strong brand recognition: The company’s strategic brands, Trane® and Thermo King®, are well-established and highly regarded in the industry, providing a competitive advantage.
• Commitment to sustainability: Trane Technologies has announced ambitious 2030 Sustainability Commitments, including its Gigaton Challenge to reduce customers’ carbon emissions by a billion metric tons through sustainable products and services.
• Successful acquisitions: The company has completed several strategic acquisitions in 2024 and 2025, which have expanded its product offerings and distribution capabilities.

Weaknesses:

• Exposure to macroeconomic and geopolitical risks: As a global business, Trane Technologies’ operations are affected by worldwide, regional, and industry-specific economic factors, as well as geopolitical, environmental, and social factors, which could disrupt its operations and supply chains.
• Material and wage inflation: The company continues to face cost pressures from material and wage inflation, which could impact its profitability if not effectively managed.
• Regulatory changes: The residential markets in the United States are undergoing a regulatory transition, which could bring short-term variation in demand and uncertainty.

Outlook and Future Prospects

Trane Technologies expects conditions to remain mixed across its served end markets and geographies. Overall, the Commercial HVAC markets in the Americas and EMEA are expected to remain strong, driven by demand for the company’s differentiated customer-driven solutions and the benefits of installing energy-efficient products and decarbonizing the built environment.

In Asia, the markets are more dynamic, with weak macroeconomic conditions driving soft demand in China and more stable macroeconomic conditions driving modest demand in the rest of Asia. The Transport Refrigeration markets are experiencing lower demand as freight rates remain low, particularly in the United States.

The company believes it has a solid foundation of global brands, a diverse portfolio, and a large installed product base, which provide growth opportunities from replacement demand and within its service revenue streams. Additionally, Trane Technologies is investing substantial resources to innovate and develop new products and services, which it expects to drive future growth.

Conclusion

Trane Technologies has delivered a strong financial performance in 2024, with significant growth in net revenues, improved gross profit margins, and solid segment-level profitability. The company’s diversified product portfolio, global presence, and commitment to sustainability position it well for continued success. However, it will need to navigate the challenges posed by macroeconomic and geopolitical risks, as well as material and wage inflation, to maintain its momentum. Overall, Trane Technologies appears well-positioned to capitalize on the growing demand for sustainable and efficient climate solutions in the years ahead.