Trane Technologies (TT) UBS Global Industrials and Transportation Conference summary

Market environment and strategy

• Maintains an in-region, for-region manufacturing strategy to minimize exposure to tariffs and global trade shifts.

• Operates as a pure-play climate control business with leading brands, generating $16B in sales, with 68% from equipment and 32% from aftermarket services.

• Focuses on broad-based growth across multiple verticals, not reliant on any single market, and leverages direct sales force and domain expertise for mega projects.

• Recognized for ESG leadership, diversity, and inclusion, with multiple industry accolades and high sustainability rankings.

• Service business represents a third of revenues, growing at high single digits over six years.

Growth sustainability and backlog

• Compound annual revenue growth has been double digits, with EPS growth over 20% for the past four years.

• Q3 2024 organic revenues grew 11% year-over-year, with adjusted EPS up 21% and adjusted EBITDA margins up 120 basis points.

• Bookings reached $5.2B, the second highest in company history, and backlog increased to $7.2B, providing strong visibility into 2025.

• Backlog remains elevated, with over $7 billion at the end of Q3, and is expected to stay high due to longer lead times.

• Backlog churns within 12 months, and front log pipelines across verticals remain strong.

Decarbonization and value selling

• Early-stage decarbonization of the built environment presents significant long-term opportunity.

• Sustainability is central, with a goal to reduce customer carbon footprint by 35% and deliver one gigaton of CO₂e reduction by 2030.

• Digital twin technology and targeted upgrades can yield immediate, quantifiable cost reductions.

• Demand-side management can address up to 30% energy waste after the meter in commercial buildings.

• Service and digital solutions help reduce waste and optimize building performance.