TULSA, Okla., Feb. 27, 2025 /PRNewswire/ — AAON, INC. (NASDAQ: AAON), a main manufacturer of top class HVAC answers, lately introduced its effects for the fourth quarter and entire yr of 2024.

Gary Gardens, CEO, mentioned, “As we anticipated early in the year, 2024 had its share of triumphs and obstacles for AAON. The BASX brand made a significant impact on the data center market with the industry’s first large-scale development and sale of a custom-designed liquid cooling solution. Along with strong demand for BASX’s air-side data center cooling equipment, this drove the Company’s total backlog to finish the year up 70.0% from the end of 2023. To meet a strengthening pipeline of demand beyond the backlog, we also successfully increased production capacity in 2024 with the completion of our 245,000 square foot addition at our Longview, Texas location and the purchase of our new 787,000 square foot building in Memphis, Tennessee. Conversely, the Company’s AAON brand faced two major challenges: an industry-regulated refrigerant transition and nonresidential construction activity that weakened throughout the year. Despite the challenges, sales of AAON-branded equipment were down only modestly in 2024. Bookings and year-end backlog of this equipment were up year-over-year in the mid-to-high teens.  All in, we deem the year to be a success.”   

Internet gross sales for the fourth quarter of 2024 reduced 2.9% to $297.7 million from $306.6 million within the fourth quarter of 2023.  The AAON Oklahoma area used to be the riding issue within the abatement in internet gross sales. The area learned a year-over-year abatement of 16.1%, the results of a mixture of things together with vulnerable macro situations and brief adversarial results of the industry-regulated refrigerant transition.  On the other hand, browsing at our two yr expansion for the years ended December 31, 2022-2024, AAON Oklahoma gross sales are up 29.4% chatting with the robust proportion features over that era. This used to be in part offset by means of an building up in gross sales of 129.9% on the AAON Coil Merchandise area, which benefited from the onset of manufacturing of BASX-branded liquid cooling information heart apparatus on the AAON Coil Merchandise facility, in addition to cast expansion of AAON-branded crack techniques.   

Rude benefit for the quarter reduced 30.5% to $77.6 million, or 26.1% of gross sales, in comparison to the similar era a yr in the past. The contraction in improper margin in part displays decrease volumes and the matching deleveraging of fastened prices on the AAON Oklahoma area. Moreover, our investments in expansion at each AAON Coil Merchandise and BASX sections supporting the expanding call for for information heart merchandise has led to brief unfavourable affects on improper income in each sections.

The fourth quarter benefited from a immense huge tax good thing about $4.6 million when it comes to secure founded repayment in comparison to $2.5 million in the similar era a yr in the past. Income in step with diluted proportion within the fourth quarter of 2024 reduced 46.4% to $0.30 from $0.56 within the fourth quarter of 2023. 

Backlog used to be up from a yr in the past in any respect 3 sections, with the biggest building up on the AAON Coil Merchandise area, which gained over $200.0 million of orders within the fourth quarter. These types of orders have been related to the BASX-branded information heart liquid cooling series, which used to be addressed at the 3rd quarter income name.

Mr. Gardens concluded, “As we progress through the early months of 2025, we believe we are nearing the end of this temporary slowdown we have been experiencing since early last year. Many of the headwinds we faced in 2024 are behind us. The adverse effects of the refrigerant transition will likely linger through the first quarter. However, as we move into the second quarter, we expect these headwinds will dissipate, resulting in an acceleration in demand. The backlog of BASX-branded equipment entered the year up over 100.0% compared to a year ago, and the pipeline of future orders remains robust. We anticipate a vast majority of the Company’s total backlog will convert in 2025. Margins will remain under pressure early in the year as we endure less-than-optimal volumes at the AAON Oklahoma segment and absorb pre-production start-up costs at the new Memphis facility. However, this will be temporary, and we expect margins to significantly improve throughout the year as volume growth accelerates and we right-size capacity and production efficiencies across the four main manufacturing locations.  Over the next two years, we anticipate gross margins returning to levels we realized in the second half of 2023. The Company’s fundamentals are strong, with substantial organic revenue and earnings growth potential, which we look forward to capitalizing on.”

As of December 31, 2024, the Corporate had money, money equivalents and limited money of $6.5 million and $154.9 million general debt. Rebecca Thompson, CFO, commented, “Cash flows from operating activities in the fourth quarter were impacted by lower net income and investments made in working capital. Due to the significant increase in backlog, we had to make necessary inventory purchases to facilitate production early in 2025. Capital expenditures in the fourth quarter increased nearly four-fold from a year ago due to the $63.4 million spent in December on the closing of our new Memphis facility. Both expenditures are related to investments in capacity and infrastructure to accommodate the robust growth we anticipate in the future. These cash outlays led us to borrow $20.8 million during the quarter through our revolving line of credit and establish our new term loan facility. Our balance sheet remains strong, with a current ratio of 2.8 and a leverage ratio of 0.57. Given this and the Company’s strong fundamentals, our Board of Directors approved a new $100.0 million share repurchase program that we would utilize opportunistically. In the near-term, our primary focus will be on organic investments to accommodate growth, including bringing the Memphis facility up to speed for production to commence later this year.” 

Convention Name and Webcast
The Corporate will host a convention name and webcast to talk about its monetary effects and outlook on February 27, 2025 at 9:00 A.M. ET. The convention name might be out there by the use of a dial-in for many who want to take part in Q&A in addition to a listen-only webcast. The out there dial-in is offered at 1-800-836-8184. To get admission to the listen-only webcast, please check in at https://app.webinar.net/0kBVxQBboaR. At the nearest industry era following the decision, a replay of the decision might be to be had at the Corporate’s web site at https://aaon.com/Investors. 

About AAON
Based in 1988, AAON is an international chief in HVAC answers for business, business and knowledge heart indoor environments. The Corporate’s industry-leading way to designing and production extremely configurable and personalized apparatus to fulfill actual wishes creates a premier possession enjoy with larger potency, efficiency and long-term worth. Its extremely engineered apparatus is bought below the AAON and BASX manufacturers.  AAON is headquartered in Tulsa, Oklahoma, the place its world-class innovation heart and checking out lab lets in AAON engineers to steadily push obstacles and walk the {industry}. For more info, please discuss with www.AAON.com. 

Ahead-Having a look Statements
This press drop contains “forward-looking statements” throughout the which means of the Non-public Securities Litigation Reform Employment of 1995. Phrases similar to “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “should”, “will”, and permutations of such phrases and homogeneous expressions are meant to spot such forward-looking statements. Those statements aren’t promises of era efficiency and contain sure dangers, uncertainties and suppositions, which can be tricky to expect. Subsequently, original results and effects might range materially from what’s expressed or forecasted in such forward-looking statements. Readers are cautioned to not playground undue reliance on those forward-looking statements, which talk solely as of the future on which they’re made. We adopt deny duties to replace publicly any forward-looking statements, whether or not on account of pristine knowledge, era occasions or in a different way. Impressive components that would purpose effects to range materially from the ones within the forward-looking statements come with (1) the timing and extent of adjustments in uncooked subject matter and property costs, (2) the results of fluctuations within the business/business pristine building marketplace, (3) the timing and extent of adjustments in rates of interest, in addition to alternative aggressive components right through the yr, and (4) normal financial, marketplace or industry situations.

Touch Data
Joseph Mondillo
Director of Investor Family members
Telephone: (617) 877-6346
E-mail: [email protected] 

Importance of Non-GAAP Monetary Measures

To complement the Corporate’s consolidated monetary statements offered in response to usually authorized accounting ideas (“GAAP”), backup non-GAAP monetary measures are supplied and reconciled in refer to tables. The Corporate believes that those non-GAAP monetary measures, when thought to be along side the GAAP monetary measures, grant knowledge that turns out to be useful to traders in working out period-over-period working effects. The Corporate believes that this non-GAAP monetary measure complements the facility of traders to research the Corporate’s industry traits and working efficiency as they’re worn by means of control to raised perceive working efficiency. Since adjusted internet source of revenue, adjusted internet source of revenue in step with diluted proportion, EBITDA, adjusted EBITDA, and changed EBITDA margin are non-GAAP measures and are liable to various calculations, adjusted internet source of revenue, adjusted internet source of revenue in step with diluted proportion, EBITDA, adjusted EBITDA, and changed EBITDA margin, as offered, is probably not immediately similar with alternative in a similar way titled measures worn by means of alternative corporations.

Non-GAAP Adjusted Internet Source of revenue

The Corporate defines non-GAAP adjusted internet source of revenue as internet source of revenue adjusted for any rare occasions, similar to litigation settlements, internet of benefit sharing and tax impact, within the sessions offered.

Refer to desk supplies a reconciliation of internet source of revenue (GAAP) to non-GAAP adjusted internet source of revenue for the sessions indicated:

EBITDA and Adjusted EBITDA

EBITDA (as outlined underneath) is gifted herein and reconciled from the GAAP measure of internet source of revenue as a result of its broad acceptance by means of the funding folk as a monetary indicator of an organization’s skill to internally investmrent operations. The Corporate defines EBITDA as internet source of revenue, plus (1) depreciation and amortization, (2) pastime expense (source of revenue), internet and (3) source of revenue tax expense. EBITDA isn’t a measure of internet source of revenue or money flows as aspiring by means of GAAP. EBITDA margin is outlined as EBITDA as a share of internet gross sales.

The Corporate’s EBITDA measure supplies backup knowledge that could be worn to raised perceive the Corporate’s operations. EBITDA is certainly one of a number of metrics that the Corporate makes use of as a supplemental monetary dimension within the analysis of its industry and must now not be thought to be as an supplementary to, or extra significant than, internet source of revenue, as a hallmark of working efficiency. Positive pieces excluded from EBITDA are important elements in working out and assessing an organization’s monetary efficiency. EBITDA, as worn by means of the Corporate, is probably not similar to in a similar way titled measures reported by means of alternative corporations. The Corporate believes that EBITDA is a extensively adopted measure of working efficiency and is one of the metrics worn by means of the Corporate’s control staff and by means of alternative customers of the Corporate’s consolidated monetary statements.

Adjusted EBITDA is calculated as EBITDA adjusted by means of pieces in non-GAAP adjusted internet source of revenue, above, excluding for taxes, as taxes are already excluded from EBITDA.

Refer to desk supplies a reconciliation of internet source of revenue (GAAP) to EBITDA (non-GAAP) and Adjusted EBITDA (non-GAAP) for the sessions indicated:

SOURCE AAON