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Mar 31, 2024
Aaon Q1 2024 Earnings Report
AAON reported mixed results with a decrease in net sales but an increase in gross profit margin and earnings per share.
Key Takeaways
AAON's first quarter results were mixed, with net sales decreasing by 1.4% to $262.1 million. However, the company saw an increase in gross profit margin to 35.2% and earnings per diluted share to $0.46. Bookings remain strong across all business segments with quarter-over-quarter increases in backlog.
Net sales decreased by 1.4% year-over-year, driven by declines in AAON Coil Products and BASX segments.
Gross profit margin expanded to 35.2%, primarily due to favorable pricing relative to moderating cost inflation.
Earnings per diluted share increased slightly to $0.46, benefiting from an excess tax benefit.
Backlog increased for a second straight quarter, with strong bookings in the data center market.
Aaon
Aaon
Aaon Revenue by Segment
Revenue by Segment
AAON Oklahoma Revenue
CapyFin.comAAON Coil Products Revenue
CapyFin.comBASX Revenue
CapyFin.com Forward Guidance
AAON anticipates improved results throughout 2024, driven by strong levels of activity indicated by independent sales reps and an acceleration of backlog conversion. The company remains positive in its long-term outlook, especially with mega projects in the data center market, and continues to invest in production capacity, people, and technology to manage growth effectively.
Positive Outlook
- Strong levels of activity indicated by independent sales reps.
- Order flow expected to improve as the deadline for ordering equipment with R410A refrigerant approaches.
- Anticipated acceleration of backlog conversion at AAON Coil Products and BASX segments.
- Large pipeline of projects, especially with mega projects in the data center market.
- Continued investments in production capacity, people, and technology.
Challenges Ahead
- Slow start to the year.
- Upcoming refrigerant regulations may cause some volatility on a month-to-month basis.
- Timing of production resulted in a softer than expected first quarter for AAON Coil Products and BASX segments.
- Lower volumes impacted the full reflection of pricing and cost management in the first quarter results.
- Potential challenges in efficiently adapting to robust growth rates over the long-term.
Revenue & Expenses
Visualization of income flow from segment revenue to net income