AAON, INC. - FORM 8-K - EX-99.1 - EXHIBIT - August 8, 2013

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Exhibit 99.1                        
NEWS
BULLETIN
 
AAON, Inc.
 
2425 South Yukon Ave. Ÿ Tulsa, OK 74107-2728
 
Ÿ Ph: (918) 583-2266 Ÿ   Fax: (918) 583-6094 Ÿ
 
Ÿhttp://www.aaon.comŸ
 
 
 
 
 
FOR IMMEDIATE RELEASE
AUGUST 8, 2013
 
For Further Information:
 
Jerry R. Levine Ÿ Phone: (914) 244-0292 Ÿ Fax: (914) 244-0295
 
Email: jrladvisor@yahoo.com

AAON REPORTS RECORD SALES AND EARNINGS

TULSA, OK, August 8, 2013 - AAON, INC. (NASDAQ-AAON), today announced its operating results for the second quarter and six month period ended June 30, 2013.

Sales and earnings during the second quarter were record highs for any quarter in the Company's history.

Management believes that the Company's percent of net income per dollar of sales (13%) in the second quarter was the highest for any quarter by any other public company, ever, in the HVAC industry.

Revenues in the quarter were $91.2 million, up 9% from $83.3 million in 2012. Net income was $12.1 million, up 30% from $9.3 million in the same period a year ago. Net sales for the six month period ended June 30, 2013, were also a record for the first half of any year, $158.1 million, up 7% compared to $148.3 million in 2012. Earnings for the six months ended June 30, 2013 were $19.3 million, up 39% compared to $13.9 million in 2012.

Earnings per diluted share in the second quarter of 2013 were $0.33, up 32% from $0.25 for the same period a year ago, based upon 37.2 million and 37.1 million diluted shares outstanding for the three months ended June 30, 2013, compared to June 30, 2012, respectively. Earnings per diluted share were $0.52, up 41% from $0.37, in the six months ended June 30, 2013, and June 30, 2012, respectively, based upon 37.1 million diluted shares outstanding for both periods. All per share earnings reflect the 3-for-2 stock split effective July 2, 2013.

Norman H. Asbjornson, President and CEO, stated, “The second quarter increases in sales and income from operations primarily reflect price increases and a decline in cost of materials; gross profit as a percent of sales increased 5% (from 25.3% to 30.3%), but SG&A expenses as a percent of sales also increased 1.7% (from 8.3% to 10.0%), the majority of which (SG&A) represents increases in “profit sharing” and warranty expense.

Mr. Asbjornson continued, "The Company's backlog increased from $62.2 million at June 30, 2012, to $66.2 million at June 30, 2013, but declined from the record of $71.7 at March 31, 2013."

Mr. Asbjornson said, “While we still anticipate record sales and profits for 2013, there has been a noticeable softening in our market which has lowered our expectations for the balance of the year as compared to the first half of the year.”

The Company will host a conference call today at 4:15 P.M. EDT to discuss the second quarter results. To participate, call 1-866-544-4631; or, for rebroadcast, call 1-866-245-6755 (code 932908).

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.


1


AAON, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2013
 
2012
 
2013
 
2012
 
(in thousands, except share and per share data)
Net sales
$
91,241

 
$
83,333

 
$
158,074

 
$
148,290

Cost of sales
63,565

 
62,230

 
115,086

 
113,669

Gross profit
27,676

 
21,103

 
42,988

 
34,621

Selling, general and administrative expenses
9,089

 
6,899

 
16,056

 
12,880

(Gain) loss on disposal of assets
(59
)
 
10

 
(52
)
 
(13
)
Income from operations
18,646

 
14,194

 
26,984

 
21,754

Interest expense
—

 
(11
)
 
(1
)
 
(27
)
Interest income
57

 
2

 
92

 
15

Other income(expense), net
253

 
(51
)
 
237

 
(3
)
Income before taxes
18,956

 
14,134

 
27,312

 
21,739

Income tax provision
6,837

 
4,837

 
8,053

 
7,875

Net income
$
12,119

 
$
9,297

 
$
19,259

 
$
13,864

Earnings per share:
 

 
 

 
 
 
 
Basic*
$
0.33

 
$
0.25

 
$
0.52

 
$
0.38

Diluted*
$
0.33

 
$
0.25

 
$
0.52

 
$
0.37

Cash dividends declared per common share*:
$
0.10

 
$
0.08

 
$
0.10

 
$
0.08

Weighted average shares outstanding:
 

 
 

 
 
 
 
Basic*
36,759,718

 
36,828,650

 
36,760,173

 
36,854,913

Diluted*
37,150,262

 
37,091,528

 
37,056,201

 
37,124,982

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



2


AAON, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
 
June 30, 2013
 
December 31, 2012
Assets
(in thousands, except share and per share data)
Current assets:
 
 
 
Cash and cash equivalents
$
19,415

 
$
3,159

Certificates of deposit
3,460

 
3,120

Investments held to maturity at amortized cost
7,353

 
2,832

Accounts receivable, net
50,108

 
43,866

Income tax receivable
410

 
694

Note receivable
29

 
28

Inventories, net
34,131

 
32,614

Prepaid expenses and other
900

 
740

Deferred tax assets
5,605

 
4,493

Total current assets
121,411

 
91,546

Property, plant and equipment:
 

 
 

Land
1,340

 
1,340

Buildings
60,126

 
59,761

Machinery and equipment
118,253

 
117,617

Furniture and fixtures
9,322

 
8,906

Total property, plant and equipment
189,041

 
187,624

Less:  Accumulated depreciation
102,963

 
96,929

Property, plant and equipment, net
86,078

 
90,695

Certificates of deposit
1,298

 
2,120

Investments held to maturity at amortized cost
11,475

 
8,041

Note receivable
952

 
1,091

Total assets
$
221,214

 
$
193,493

 
 
 
 
Liabilities and Stockholders' Equity
 

 
 

Current liabilities:
 

 
 

Revolving credit facility
$
—

 
$
—

Accounts payable
13,858

 
13,047

Dividends payable
3,712

 
—

Accrued liabilities
36,045

 
26,578

Total current liabilities
53,615

 
39,625

Deferred revenue
201

 
—

Deferred tax liabilities
14,878

 
15,732

Commitments and contingencies


 


Stockholders' equity:
 

 
 

Preferred stock, $.001 par value, 16,875,000 shares authorized, no shares issued*
—

 
—

Common stock, $.004 par value, 168,750,000 shares authorized,
147

 
147

36,754,988 and 36,776,624 issued and outstanding at June 30, 2013
 

 
 

and December 31, 2012, respectively*
 

 
 

Additional paid-in capital
—

 
—

Retained earnings
152,373

 
137,989

Total stockholders' equity
152,520

 
138,136

Total liabilities and stockholders' equity
$
221,214

 
$
193,493

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


3


AAON, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
 
Six Months Ended 
 June 30,
 
2013
 
2012
Operating Activities
(in thousands)
Net income
$
19,259

 
$
13,864

Adjustments to reconcile net income to net cash provided by operating activities:
 

 
 

Depreciation
6,268

 
6,747

Amortization of bond premiums
304

 
20

Provision for losses on accounts receivable, net of adjustments
102

 
(1
)
Provision for excess and obsolete inventories
201

 
—

Share-based compensation
695

 
364

Excess tax benefits from stock options exercised and restricted stock awards vested
(385
)
 
(33
)
Gain on disposition of assets
(52
)
 
(13
)
Foreign currency transaction gain
43

 
7

Interest income on note receivable
(20
)
 
—

Deferred income taxes
(1,966
)
 
(875
)
Write-off of note receivable
75

 
—

Changes in assets and liabilities:
 

 
 

Accounts receivable
(6,344
)
 
(17,949
)
Income tax receivable
3,942

 
5,801

Inventories
(1,718
)
 
(4,194
)
Prepaid expenses and other
(160
)
 
(91
)
Accounts payable
1,101

 
4,215

Deferred revenue
201

 
—

Accrued liabilities
6,194

 
11,714

Net cash provided by operating activities
27,740

 
19,576

Investing Activities
 

 
 

Capital expenditures
(1,949
)
 
(8,091
)
Proceeds from sale of property, plant and equipment
60

 
306

Investment in certificates of deposits
(958
)
 
(4,274
)
Maturities of certificates of deposits
1,440

 
—

Purchases of investments held to maturity
(9,969
)
 
(5,624
)
Maturities of investments
1,710

 
—

Proceeds from called investment
—

 
270

Principal payments from note receivable
40

 
15

Net cash used in investing activities
(9,626
)
 
(17,398
)
Financing Activities
 

 
 

Borrowings under revolving credit facility
2,321

 
27,108

Payments under revolving credit facility
(2,321
)
 
(24,424
)
Stock options exercised
767

 
69

Excess tax benefits from stock options exercised and restricted stock awards vested
385

 
33

Repurchase of stock
(3,010
)
 
(1,895
)
Net cash (used in) provided by financing activities
(1,858
)
 
891

Net increase in cash and cash equivalents
16,256

 
3,069

Cash and cash equivalents, beginning of period
3,159

 
13

Cash and cash equivalents, end of period
$
19,415

 
$
3,082



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