SOURCE: AAON

AAON

May 05, 2011 07:00 ET

AAON Reports First Quarter Results and 3-for-2 Stock Split

TULSA, OK--(Marketwire - May 5, 2011) - AAON, INC. (NASDAQ: AAON) today announced its operating results for the three months ended March 31, 2011 compared to March 31, 2010. Sales increased 22% to $59.9 million from $49.3 million, while net income decreased 27% to $3.7 million from $5.1 million. Earnings per diluted share were $0.22, down 26% from $0.30, based upon 16.6 million and 17.3 million diluted shares outstanding, respectively.

Norman H. Asbjornson, President and CEO, stated, "Sales increased primarily due to new products and a highly successful products show on January 30. The drop in profit is attributable to record snowstorms in Tulsa during the week of February 1-8, which caused multiple roof collapses on our manufacturing facilities and closed down production for 8 1/2 days, which was further compounded by the lack of ability to properly heat the facilities for the remainder of the quarter, thus adversely affecting productivity for the last two months of the quarter. The damage will not be completely repaired until August. The building damage was covered by insurance, subject to a $500,000 deductible. The uninsured amount of damage to equipment is yet to be determined. Profits were also impacted by higher commodity and purchase parts prices."

Mr. Asbjornson added that, "We view the snowfall event in the first quarter as an abnormal occurrence. Looking forward, we anticipate continued increases in sales and improved profitability for the balance of 2011, enhanced by a 5% price increase on most products for orders taken after March 31. Further, our backlog has increased to $48 million from $36 million on March 31, 2011 and 2010, respectively."

Mr. Asbjornson then announced that the Board of Directors of the Company has approved a 3-for-2 stock split of the Company's common stock to be paid in the form of a 50 percent stock dividend on June 13, 2011. Stockholders of record at the close of business on May 27, 2011, will receive one additional share for every two shares they hold as of that date. Cash will be paid in lieu of fractional shares. Based on the shares currently outstanding, the number of shares outstanding will increase from approximately 16.5 million to approximately 24.7 million. He said, "We believe the stock split will provide a desirable increase in our market liquidity."

The Company will host a conference call today at 4:15 P.M. ET to discuss the first quarter results. To participate, call 1-877-737-1669 (Code: VA86568).

AAON, Inc. is a manufacturer of air-conditioning and heating equipment consisting of rooftop units, chillers, air-handling units, condensing units, heat recovery units, commercial self-contained units and coils. Its products serve the new construction and replacement markets. The Company has successfully gained market share through its "semi-custom" product lines, which offer the customer value, quality, function, serviceability and efficiency.

Certain statements in this news release may be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933. Statements regarding future prospects and developments are based upon current expectations and involve certain risks and uncertainties that could cause actual results and developments to differ materially from the forward-looking statements.

                   AAON, Inc., and Subsidiaries
                Consolidated Statements of Income
                          (unaudited)

                                                      Three Months Ended
                                                    March 31,   March 31,
                                                       2011        2010
                                                    ----------  ----------
                                                     (in thousands except
                                                      per share amounts)

Net sales                                           $   59,913  $   49,309

Cost of sales                                           48,275      36,315
                                                    ----------  ----------

Gross profit                                            11,638      12,994

Selling, general and administrative expenses             5,543       4,828
                                                    ----------  ----------

Income from operations                                   6,095       8,166

Interest expense                                           (10)          -

Interest income                                             34           6

Other expense, net                                        (503)        (60)
                                                    ----------  ----------

Income before income taxes                               5,616       8,112

Income tax provision                                     1,966       2,994
                                                    ----------  ----------

Net income                                          $    3,650  $    5,118
                                                    ==========  ==========

Earnings per share:
  Basic                                             $     0.22  $     0.30
                                                    ==========  ==========
  Diluted                                           $     0.22  $     0.30
                                                    ==========  ==========

Cash dividends declared per common share:           $     0.00  $     0.00
                                                    ==========  ==========

Weighted average shares outstanding:
  Basic                                                 16,496      17,186
                                                    ==========  ==========
  Diluted                                               16,626      17,271
                                                    ==========  ==========

     The accompanying notes are an integral part of these statements.




                   AAON, Inc., and Subsidiaries
                   Consolidated Balance Sheets
                           (unaudited)

                                                   March 31,   December 31,
                                                      2011         2010
                                                  ------------ ------------
                                                    (in thousands except
Assets                                            share and per share data)
Current assets:
  Cash and cash equivalents                       $      5,553 $      2,393
  Certificates of deposit                                  676        1,503
  Investments held to maturity at amortized cost         5,249        9,520
  Accounts receivable, net                              38,582       39,901
  Note receivable                                           26           26
  Inventories, net                                      39,159       33,602
  Prepaid expenses and other                               603          656
  Deferred tax assets                                    4,287        4,147
                                                  ------------ ------------
Total current assets                                    94,135       91,748
                                                  ------------ ------------

Property, plant and equipment:
  Land                                                   1,340        1,328
  Buildings                                             46,798       45,482
  Machinery and equipment                              108,708      100,559
  Furniture and fixtures                                 6,850        6,356
                                                  ------------ ------------
    Total property, plant and equipment                163,696      153,725
    Less: Accumulated depreciation                      88,753       86,307
                                                  ------------ ------------
  Property, plant and equipment, net                    74,943       67,418

Note receivable, long-term                               1,165        1,111
                                                  ------------ ------------
Total assets                                      $    170,243 $    160,277
                                                  ============ ============

Liabilities and Stockholders' Equity
Current liabilities:
  Revolving credit facility                       $      7,639 $          -
  Accounts payable                                      13,683       13,017
  Accrued liabilities                                   21,774       23,229
                                                  ------------ ------------
Total current liabilities                               43,096       36,246

Deferred tax liabilities                                 7,257        7,292
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.001 par value, 7,500,000
 shares authorized, no shares issued                         -            -
Common stock, $.004 par value, 75,000,000 shares
 authorized, 16,483,876 and 16,505,653 issued and
 outstanding at March 31, 2011 and December 31,
 2010, respectively                                         68           68
Retained earnings                                      119,822      116,671
                                                  ------------ ------------
Total stockholders' equity                             119,890      116,739
                                                  ------------ ------------
Total liabilities and stockholders' equity        $    170,243 $    160,277
                                                  ============ ============

     The accompanying notes are an integral part of these statements.




                   AAON, Inc., and Subsidiaries
              Consolidated Statements of Cash Flows
                           (unaudited)

                                                      Three       Three
                                                      Months      Months
                                                      Ended       Ended
                                                    March 31,   March 31,
                                                       2011        2010
                                                    ----------  ----------
                                                        (in thousands)
Operating Activities
  Net income                                        $    3,650  $    5,118

  Adjustments to reconcile net income to net cash
   provided by operating activities:
    Depreciation                                         2,703       2,405
    Amortization of bond premiums                           90           -
    Provision for losses on accounts receivable,
     net of adjustments                                   (10)        (96)
    Share-based compensation                               175         209
    Excess tax benefits from stock options
     exercised and restricted stock awards vested          (10)        (16)
    Loss on disposition of assets                            6           -
    Other, effect of foreign currency (gain) loss          (60)          -
    Deferred income taxes                                 (175)       (919)
    Changes in assets and liabilities:
      Accounts receivable                                1,329       2,981
      Inventories                                       (5,557)     (1,798)
      Prepaid expenses and other                            53         507
      Financial derivative assets                            -         526
      Accounts payable                                     666         985
      Accrued liabilities                               (1,445)      2,882
                                                    ----------  ----------
  Net cash provided by operating activities              1,415      12,784
                                                    ----------  ----------

Investing Activities
  Proceeds from sale of property, plant and
    equipment                                               35           -
  Investment in certificates of deposit                      -      (2,744)
  Maturities of certificates of deposit                    827         240
  Investments held to maturity                               -     (12,118)
  Maturities of investments                              4,181         300
  Capital expenditures                                 (10,270)     (3,529)
  Proceeds from note receivable                              7           -
                                                    ----------  ----------
  Net cash used in investing activities                 (5,220)    (17,851)
                                                    ----------  ----------

Financing Activities
  Borrowings under revolving credit facility            12,643           -
  Payments under revolving credit facility              (5,004)          -
  Payments of long-term debt                                 -         (23)
  Stock options exercised                                   59         128
  Excess tax benefits from stock options exercised
   and restricted stock awards vested                       10          16
  Repurchases of stock                                    (743)     (2,001)
  Cash dividends paid to stockholders                        -      (3,100)
                                                    ----------  ----------
  Net cash provided by (used) in financing
   activities                                            6,965      (4,980)
                                                    ----------  ----------
Effect of exchange rate on cash                              -          (2)
                                                    ----------  ----------
Net increase (decrease) in cash and cash
 equivalents                                             3,160     (10,049)
                                                    ----------  ----------
Cash and cash equivalents, beginning of year             2,393      25,639
                                                    ----------  ----------
Cash and cash equivalents, end of period            $    5,553  $   15,590
                                                    ==========  ==========

     The accompanying notes are an integral part of these statements.

Contact Information

  • For Further Information:
    Jerry R. Levine
    Phone: (914) 244-0292
    Fax: (914) 244-0295
    Email: jrladvisor@yahoo.com