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
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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