SOURCE: AAON

AAON

November 07, 2013 07:00 ET

AAON Reports Record Sales and Earnings

TULSA, OK--(Marketwired - Nov 7, 2013) - AAON, Inc. (NASDAQ: AAON), today announced its operating results for the third quarter and nine-month period ended September 30, 2013.

The quarter ended September 30, 2013 was the fourth consecutive quarter to produce the highest sales and earnings for any corresponding quarter in any year in the 25-year history of the company. Sales and earnings for the nine months ended September 30, 2013, were also all time records.

Revenues in the quarter were $89.7 million, up 16.8% from $76.8 million in 2012. Net income was $10.5 million, up 75.2% from $6.0 million in the same period a year ago. Net sales for the nine-month period ended September 30, 2013 were $247.8 million, up 10.1% compared to $225.1 million in 2012. Earnings for the nine months ended September 30, 2013 were $29.8 million, up 49.9% compared to $19.9 million in 2012.

Earnings per diluted share in the third quarter of 2013 were $0.28, up 75.0% from $0.16 for the same period a year ago, based upon 37.0 million shares outstanding for both periods. Earnings per diluted share were $0.80, up 48.1% from $0.54, in the nine months ended September 30, 2013, and September 30, 2012, respectively, based upon 37.0 million and 37.1 million diluted shares outstanding for the nine months ended September 30, 2013, and September 30, 2012, respectively. All per share earnings reflect the 3-for-2 stock split effective July 2, 2013.

Norman H. Asbjornson, President and CEO, stated, "The third quarter gains in sales and income from operations primarily reflect an increase in market share, as well as price increases and a decline in cost of materials; gross profit as a percent of sales increased from 22.3% to 29.7%, but SG&A expenses as a percent of sales also increased from 8.8% to 10.8%, the majority of which (SG&A) represents increases in 'profit sharing' and warranty expense."

Mr. Asbjornson continued, "The Company's backlog decreased from $55.3 million at September 30, 2012 to $49.9 million at September 30, 2013."

Mr. Asbjornson said, "While we are confident of having record sales and profits for 2013, we expect a decline in sales and fairly level profits in the fourth quarter of 2013 compared to an exceptionally strong fourth quarter last year."

At a meeting of the Board of Directors on November 6, 2013, the Board declared a regular semi-annual cash dividend of $0.10 per share, which will be paid to the holders of the outstanding Common Stock of the Company as of the close of business on December 2, 2013, the record date, payable December 23, 2013.

The Company will host a conference call today at 4:15 P.M. Eastern Time to discuss the third quarter results. To participate, call 1-866-544-4631; or, for rebroadcast, call 1-866-245-6755 (code 531989).

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
 September 30,
  Nine Months Ended
 September 30,
    2013   2012   2013   2012
    (in thousands, except share and per share data)
Net sales   $ 89,690     $ 76,816     $ 247,764     $ 225,106  
Cost of sales     63,074       59,667       178,160       173,336  
Gross profit     26,616       17,149       69,604       51,770  
Selling, general and administrative expenses     9,687       6,747       25,743       19,627  
Gain on disposal of assets     --       4       52       17  
Income from operations     16,929       10,406       43,913       32,160  
Interest expense     (1 )     (16 )     (2 )     (43 )
Interest income     61       40       153       55  
Other income (expense), net     15       53       252       50  
Income before taxes     17,004       10,483       44,316       32,222  
Income tax provision     6,482       4,476       14,535       12,351  
Net income   $ 10,522     $ 6,007     $ 29,781     $ 19,871  
Earnings per share:                                
  Basic*   $ 0.29     $ 0.16     $ 0.81     $ 0.54  
  Diluted*   $ 0.28     $ 0.16     $ 0.80     $ 0.54  
Cash dividends declared per common share*:   $ --     $ --     $ 0.10     $ 0.08  
Weighted average shares outstanding:                                
  Basic*     36,742,262       36,803,235       36,752,657       36,837,686  
  Diluted*     37,017,561       37,001,127       37,041,775       37,083,695  
                                   

*Reflects three-for-two stock split effective July 2, 2013

 
 
AAON, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
 
    September 30, 2013   December 31, 2012
Assets   (in thousands, except share and per share data)
Current assets:            
  Cash and cash equivalents   $ 2,289   $ 3,159
  Certificates of deposit     8,186     3,120
  Investments held to maturity at amortized cost     11,421     2,832
  Accounts receivable, net     46,129     43,866
  Income tax receivable     1,769     694
  Note receivable     29     28
  Inventories, net     33,383     32,614
  Prepaid expenses and other     619     740
  Deferred tax assets     5,296     4,493
Total current assets     109,121     91,546
Property, plant and equipment:            
  Land     1,353     1,340
  Buildings     60,435     59,761
  Machinery and equipment     122,356     117,617
  Furniture and fixtures     9,539     8,906
    Total property, plant and equipment     193,683     187,624
    Less: Accumulated depreciation     105,975     96,929
  Property, plant and equipment, net     87,708     90,695
Certificates of deposit     4,483     2,120
Investments held to maturity at amortized cost     17,867     8,041
Note receivable     959     1,091
Total assets   $ 220,138   $ 193,493
             
Liabilities and Stockholders' Equity            
Current liabilities:            
  Revolving credit facility   $ --   $ --
  Accounts payable     12,795     13,047
  Dividends payable     --     --
  Accrued liabilities     30,314     26,578
Total current liabilities     43,109     39,625
Deferred revenue     358     --
Deferred tax liabilities     14,741     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, 168,750,000 shares authorized, 36,709,890 and 36,776,624 issued and outstanding at September 30, 2013 and December 31, 2012, respectively*     147     147
Additional paid-in capital     --     --
Retained earnings     161,783     137,989
Total stockholders' equity     161,930     138,136
Total liabilities and stockholders' equity   $ 220,138   $ 193,493
             

*Reflects three-for-two stock split effective July 2, 2013

   
   
AAON, Inc. and Subsidiaries  
Consolidated Statements of Cash Flows  
(Unaudited)  
   
    Nine Months Ended
 September 30,
 
    2013     2012  
Operating Activities   (in thousands)  
  Net income   $ 29,781     $ 19,871  
  Adjustments to reconcile net income to net cash provided by operating activities:                
    Depreciation     9,349       10,079  
    Amortization of bond premiums     545       80  
    Provision for losses on accounts receivable, net of adjustments     121       (7 )
    Provision for excess and obsolete inventories     468       --  
    Share-based compensation     1,054       625  
    Excess tax benefits from stock options exercised and restricted stock awards vested     (502 )     (267 )
    Gain on disposition of assets     (52 )     (17 )
    Foreign currency transaction gain (loss)     35       (40 )
    Interest income on note receivable     (31 )     --  
    Deferred income taxes     (1,794 )     (987 )
    Write-off of note receivable     75       --  
    Changes in assets and liabilities:                
      Accounts receivable     (2,384 )     (8,227 )
      Income tax receivable     1,753       5,801  
      Inventories     (1,237 )     (2,702 )
      Prepaid expenses and other     121       148  
      Accounts payable     (227 )     2,681  
      Deferred revenue     358       --  
      Accrued liabilities     1,410       11,375  
  Net cash provided by operating activities     38,843       38,413  
Investing Activities                
  Capital expenditures     (6,407 )     (12,582 )
  Proceeds from sale of property, plant and equipment     72       311  
  Investment in certificates of deposits     (8,869 )     (4,280 )
  Maturities of certificates of deposits     1,440       1,060  
  Purchases of investments held to maturity     (22,275 )     (5,624 )
  Maturities of investments     3,315       --  
  Proceeds from called investment     --       270  
  Principal payments from note receivable     52       20  
  Net cash used in investing activities     (32,672 )     (20,825 )
Financing Activities                
  Borrowings under revolving credit facility     8,325       34,847  
  Payments under revolving credit facility     (8,325 )     (39,422 )
  Stock options exercised     986       1,053  
  Excess tax benefits from stock options exercised and restricted stock awards vested     502       267  
  Repurchase of stock     (4,817 )     (4,379 )
  Cash dividends paid to stockholders     (3,712 )     (2,950 )
  Net cash used in financing activities     (7,041 )     (10,584 )
Net (decrease) increase in cash and cash equivalents     (870 )     7,004  
Cash and cash equivalents, beginning of period     3,159       13  
Cash and cash equivalents, end of period   $ 2,289     $ 7,017  
                 

Contact Information

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