Profile: Lennox International Inc. (LII)

Lennox International Inc. (LII) is a global provider of climate control solutions. The Company designs, manufactures and markets a range of products for the heating, ventilation, air conditioning and refrigeration (HVACR) markets. The Company operates in four business segments: Residential Heating and Cooling, Commercial Heating and Cooling, Service Experts and Refrigeration. The Company's products and services are sold through multiple distribution channels under brand names, such as Lennox, Armstrong Air, Ducane, Bohn, Larkin, Advanced Distributor Products and Service Experts. The Company’s products and services are sold through a combination of distributors, independent and Company-owned dealer service centers, other installing contractors, wholesalers, manufacturer’s representatives, original equipment manufacturers (OEMs) and national accounts.

Residential Heating and Cooling

LII manufactures and markets a range of furnaces, air conditioners, heat pumps, packaged heating and cooling systems, accessories to improve indoor air quality, replacement parts and related products for both the residential replacement and new construction markets for both the residential replacement and new construction markets in North America. These products are available in a variety of designs and efficiency levels, and at a range of price points in order to provide a complete line of home comfort systems. The Lennox and Aire-Flo brands are sold directly to a network of approximately 7,000 installing dealers. The Armstrong Air, Ducane, AirEase, Concord, Magic-Pak and Advanced Distributor Products brands are sold through independent distributors.

The Company's Advanced Distributor Products operation builds evaporator coils and air handlers under the Advanced Distributor Products brand, as well as the Lennox, Armstrong Air, AirEase, Concord and Ducane brands. Hearth products offered by LII include factory-built gas, wood-burning and electric fireplaces; free standing wood-burning, pellet and gas stoves, wood-burning, pellet and gas fireplace inserts, and gas logs, venting products and accessories. Many of the fireplaces are built with a blower or fan option. The Company markets its hearth products under the Lennox, Superior, Whitfield, Country Collection and Security Chimneys brand names.

In the residential heating and cooling segment, LII competes with United Technologies Corp., Goodman Global, Inc., Ingersoll-Rand Company Limited, Paloma Co., Ltd., Johnson Controls, Inc., Nordyne, HNI Corporation and Monessen.

Commercial Heating and Cooling

In North America, LII manufactures and sells unitary heating and cooling equipment that is used in light commercial applications, such as low-rise office buildings, restaurants, retail centers, churches and schools, as opposed to larger applied systems. The Company's product offerings for these applications include rooftop units that range from 2 to 50 tons of cooling capacity and split system/air handler combinations, which range from 1.5 to 20 tons. These products are distributed primarily through commercial contractors and directly to national account customers.

In Europe, the Company manufactures and sells unitary products, which range from 2 to 70 tons, and applied systems with up to 200 tons of cooling capacity. LII's European products consist of small package units, rooftop units, chillers, air handlers and fan coils that serve medium-rise commercial buildings, shopping malls, other retail and entertainment buildings, institutional applications and other field-engineered applications. LII manufactures heating and cooling products in several locations in Europe and markets these products through both direct and indirect distribution channels in Europe, Russia, Turkey and the Middle East.

In the commercial heating and cooling segment, LII competes with United Technologies Corp., Ingersoll-Rand Company Limited, Johnson Controls, Inc., AAON, Inc. and Daikin Industries, Ltd.

Service Experts

Through approximately 116 Company-owned dealer service centers in its Service Experts segment, LII provides installation, preventive maintenance, emergency repair and replacement of heating and cooling systems directly to both residential and light commercial customers in metropolitan areas in the United States and Canada. In connection with these services, the Company sells a range of manufactured equipment, parts and supplies, and third party branded products.

In the service experts segment, LII competes with Sears and American Residential Services.

Refrigeration

LII manufactures and markets equipment for the global commercial refrigeration market through subsidiaries organized under the Heatcraft Worldwide Refrigeration name. These products are sold to distributors, installing contractors, engineering design firms, OEM's and end users. The Company's commercial refrigeration products for the North American market include condensing units, unit coolers, fluid coolers, air-cooled condensers, compressor racks and air handlers. These products are sold for cold storage applications, primarily to preserve food and other perishables, and are used by supermarkets, convenience stores, restaurants, warehouses and distribution centers. As part of its sale of commercial refrigeration products, LII routinely provides application engineering for consulting engineers, contractors and others. It also sells products for non-cold storage applications, such as telecommunications and medical applications.

In international markets, LII manufactures and markets refrigeration products, including condensing units, unit coolers, air-cooled condensers, fluid coolers, refrigeration racks and small chillers. The Company has manufacturing locations in Europe, Australia, Brazil and China. LII also owns 50% of a joint venture in Mexico that produces unit coolers, air-cooled condensers, condensing units and compressor racks of the same design and quality as those manufactured by LII in the United States. The Company also owns a 9% interest in a manufacturer in Thailand that produces compressors for use in its products and for other HVACR customers as well.

In the refrigeration segment, LII competes with United Technologies Corp., Ingersoll-Rand Company Limited, Tecumseh Products Company and Emerson Electric Co.