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Mar 31, 2021
Aaon Q1 2021 Earnings Report
AAON's performance in Q1 2021 was influenced by market moderation and weather challenges, yet demand showed signs of improvement.
Key Takeaways
AAON reported a decrease in net sales by 15.8% to $115.8 million compared to Q1 2020, with diluted EPS down 26.8% to $0.30. The company's backlog increased sequentially, reflecting improved demand, and reached $96.7 million at the end of the quarter.
Net sales decreased by 15.8% to $115.8 million compared to the first quarter of 2020.
Diluted earnings per share (EPS) decreased by 26.8% to $0.30, primarily due to lower revenue.
Backlog finished the quarter at $96.7 million, up from $74.4 million at the end of 2020, reflecting improved demand.
New bookings in the quarter increased 21% compared to the same period last year, with demand continuing to strengthen through April.
Aaon
Aaon
Forward Guidance
AAON anticipates revenue and earnings will progressively improve throughout 2021, driven by improving replacement demand and stabilization in the new construction market. The company is confident in maintaining margins through disciplined price management despite inflation challenges.
Positive Outlook
- Demand is improving, with backlog at the beginning of May up considerably from both the end of 2020 and the end of the first quarter.
- Replacement demand is already improving as the economy recovers.
- The new construction market is beginning to show signs of stabilization.
- AAON is confident in maintaining margins through disciplined price management.
- The company anticipates revenue and earnings will progressively improve throughout 2021.
Challenges Ahead
- The year over year decline in revenue and earnings was unsurprising considering the all-time record quarter realized in the first quarter of 2020.
- The company faced challenges related to the new construction market.
- Adverse weather at both facilities in February impacted performance.
- Inflation remains a challenge.
- The prior year quarter was an all time record for the Company creating a tough relative comparison.