SOURCE: AAON

AAON

March 13, 2014 07:00 ET

AAON Reports Record Earnings for Fourth Quarter and Year 2013

TULSA, OK--(Marketwired - Mar 13, 2014) -  AAON, INC. (NASDAQ: AAON), today announced its operating results for the fourth quarter and year 2013. Sales in the fourth quarter were $73.4 million, down 5.9% from $78.0 million in 2012. Net income was a record $7.8 million, up 2.6% from $7.6 million in the same period a year ago. Sales for the year 2013 were a record $321.1 million, up 5.9% compared to $303.1 million in 2012. Earnings for 2013 were also a record, $37.5 million, up 36.9% compared to $27.4 million in 2012.

Earnings for the fourth quarter of 2013 and 2012 were both $0.21 per diluted share, based upon 37.1 million and 36.9 million diluted shares outstanding, respectively. Earnings per diluted share for year 2013 were $1.01, up 36.5% from $0.74 in 2012, based upon 37.1 million and 37.0 million diluted shares outstanding, respectively. All per share earnings reflect the 3-for-2 stock split effective July 2, 2013.

Norman H. Asbjornson, President and CEO, stated, "The 2013 gains in sales and income from operations primarily reflect increases in market share, as well as price increases and a decline in cost of materials; gross profit as a percent of sales increased from 23.3% to 28.0%, but SG&A expenses as a percent of sales also increased from 8.7% to 10.6%, the majority of which (SG&A) represents increases in warranty expense and 'profit sharing'."

Mr. Asbjornson continued, "The Company's backlog increased from $43.6 million at December 31, 2012 to $45.3 million at December 31, 2013. In addition, the Company's balance sheet at year end was strong. The current ratio was 3.1:1 (including cash and investments of $49.9 million). We remained debt free and our return on average stockholder equity was 24.8% in 2013."

Mr. Asbjornson next said, "It appears from information available to us that there will be a flat to modestly improving economy in our segments of the HVAC industry in 2014. Based upon this forecast and other factors, we anticipate AAON having another good year in 2014."

The Company will host a conference call today at 4:15 P.M. EDT to discuss the fourth quarter and year 2013 results. To participate, call 1-866-544-4631; or, for rebroadcast, call 1-866-245-6755 (code 14576).

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
Unaudited Consolidated Statements of Income
 
    Three Months Ended
 December 31,
    Years Ending
December 31,
   
    2013   2012     2013   2012    
    (in thousands, except share and per share data)    
Net sales   $ 73,376     $ 78,008       $ 321,140     $ 303,114    
Cost of sales     53,188       59,279         231,348       232,615    
Gross profit     20,188       18,729         89,792       70,499    
Selling, general and administrative expenses     8,246       6,634         33,989       26,261    
Gain (loss) on disposal of assets     30       21         (22 )     4    
Income from operations     11,912       12,074         55,825       44,234    
Interest income, net     70       30         221       42    
Other (expense) income, net     (4 )     (9 )       248       41    
Income before taxes     11,978       12,095         56,294       44,317    
Income tax provision     4,212       4,517         18,747       16,868    
Net income   $ 7,766     $ 7,578       $ 37,547     $ 27,449    
Earnings per share:                                    
  Basic*   $ 0.21     $ 0.21       $ 1.02     $ 0.75    
  Diluted*   $ 0.21     $ 0.21       $ 1.01     $ 0.74    
Cash dividends declared per common share*:   $ 0.10     $ 0.16   (1)   $ 0.20     $ 0.24   (1)
Weighted average shares outstanding:                                    
  Basic*     36,726,609       36,787,893         36,746,100       36,825,170    
  Diluted*     37,107,870       36,944,489         37,058,254       37,048,826    
                                     
 *Reflects three-for-two stock split effective July 2, 2013
(1) Includes special dividend of $0.08 per common share paid on December 24, 2012.
 
 
AAON, Inc. and Subsidiaries
Unaudited Consolidated Balance Sheets
    December 31,
    2013   2012
Assets   (in thousands, except share and per share data)
Current assets:            
  Cash and cash equivalents   $ 12,085   $ 3,159
  Certificates of deposit     8,110     3,120
  Investments held to maturity at amortized cost     16,040     2,832
  Accounts receivable, net     39,063     43,866
  Income tax receivable     1,073     694
  Note receivable     29     28
  Inventories, net     32,140     32,614
  Prepaid expenses and other     304     740
  Deferred tax assets     4,779     4,493
Total current assets     113,623     91,546
Property, plant and equipment:            
  Land     1,417     1,340
  Buildings     61,821     59,761
  Machinery and equipment     119,439     117,617
  Furniture and fixtures     9,748     8,906
    Total property, plant and equipment     192,425     187,624
    Less: Accumulated depreciation     105,142     96,929
  Property, plant and equipment, net     87,283     90,695
Certificates of deposit     2,638     2,120
Investments held to maturity at amortized cost     10,981     8,041
Notes receivable     919     1,091
Total assets   $ 215,444   $ 193,493
             
Liabilities and Stockholders' Equity            
Current liabilities:            
  Revolving credit facility   $ --   $ --
  Accounts payable     7,779     13,047
  Accrued liabilities     28,550     26,578
Total current liabilities     36,329     39,625
Deferred revenue     585     --
Deferred tax liabilities     14,424     15,732
Commitments and contingencies            
Stockholders' equity:            
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares issued            
Common stock, $.004 par value, 50,000,000 shares authorized, 36,711,354 and 36,776,624 issued and outstanding at December 31, 2013 and 2012, respectively*     147     147
Additional paid-in capital            
Retained earnings     163,959     137,989
Total stockholders' equity     164,106     138,136
Total liabilities and stockholders' equity   $ 215,444   $ 193,493
             
*Reflects three-for-two stock split effective July 2, 2013
 
 
AAON, Inc. and Subsidiaries
Unaudited Consolidated Statements of Cash Flows
    Years Ending December 31,
    2013   2012   2011
Operating Activities   (in thousands)
Net income   $ 37,547     $ 27,449     $ 13,986  
  Adjustments to reconcile net income to net cash provided by operating activities:                  
  Depreciation     12,312       13,407       11,397  
  Amortization of bond premiums     790       155       156  
  Provision for losses on accounts receivable, net of adjustments     141       (83 )     (289 )
  Provision for excess and obsolete inventories     243       63       (50 )
  Share-based compensation     1,763       1,294       680  
  Excess tax benefits from stock options exercised and restricted stock awards vested     (843 )     (393 )     (211 )
  Gain on disposition of assets     (22 )     4       1,802  
  Foreign currency transaction gain     67       (27 )     (8 )
  Interest income on note receivable     (40 )     (42 )     --  
  Deferred income taxes     (1,594 )     (2,028 )     10,122  
  Write-off of note receivable     75       --       --  
  Changes in assets and liabilities:                  
    Accounts receivable     4,662       (9,646 )     6,053  
    Income tax receivable     464       9,715       (10,016 )
    Inventories     231       2,271       (1,296 )
    Prepaid expenses and other     436       (17 )     (67 )
    Accounts payable     (5,197 )     2,461       (2,751 )
    Deferred revenue     615       --       --  
    Accrued liabilities     1,942       6,584       (3,024 )
Net cash provided by operating activities     53,592       51,167       26,484  
Investing Activities                  
  Capital expenditures     (9,041 )     (14,147 )     (35,914 )
  Proceeds from sale of property, plant and equipment     92       11       482  
  Investment in certificates of deposits     (9,108 )     (6,540 )     --  
  Maturities of certificates of deposits     3,600       1,300       1,503  
  Purchases of investments held to maturity     (22,275 )     (11,654 )     --  
  Maturities of investments     2,005       --       9,364  
  Proceeds from called investments     3,332       626       --  
  Principal payments from note receivable     69       69       27  
  Net cash used in investing activities     (31,326 )     (30,335 )     (24,538 )
Financing Activities                  
  Borrowings under revolving credit facility     8,325       34,847       82,078  
  Payments under revolving credit facility     (8,325 )     (39,422 )     (77,503 )
  Stock options exercised     1,467       1,996       494  
  Excess tax benefits from stock options exercised and restricted stock awards vested     843       393       211  
  Repurchase of stock     (8,222 )     (6,660 )     (3,671 )
  Cash dividends paid to stockholders     (7,428 )     (8,840 )     (5,935 )
  Net cash used in financing activities     (13,340 )     (17,686 )     (4,326 )
Net increase (decrease) in cash and cash equivalents     8,926       3,146       (2,380 )
Cash and cash equivalents, beginning of period     3,159       13       2,393  
Cash and cash equivalents, end of period   $ 12,085     $ 3,159     $ 13  
                         
                         

Contact Information

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