TULSA, Okla., Aug. 02, 2018 (GLOBE NEWSWIRE) -- AAON, Inc. (NASDAQ-AAON) today announced its operating results for the second quarter and six months ended June 30, 2018.

In the quarter ended June 30, 2018, net sales were $109.6 million, up 8.2% from $101.3 million in 2017. Net income was $11.7 million, a decline of 15.2% from $13.8 million in the same period a year ago. Net sales for the six months ended June 30, 2018 were $208.7 million, increasing 11.3% from $187.4 million in 2017. Net income for the six months ended June 30, 2018 was $16.0 million, down 33.6% from $24.0 million in 2017.

Our backlog at June 30, 2018 increased 87.5% to $156.6 million, from $83.5 million for the same period a year ago.

Earnings per diluted share in the second quarter of 2018 were $0.22, down 15.4% from $0.26 for the same period in 2017, based upon 52.7 million and 53.2 million shares outstanding at June 30, 2018 and 2017, respectively. Earnings per diluted share for the six months ended June 30, 2018 were $0.30, a decrease of 33.3% from $0.45 in 2017, based upon 52.8 million and 53.2 million shares outstanding at June 30, 2018 and 2017, respectively

While gross profit is down for both the quarter and six months compared to 2017, as a percent of sales gross profit increased from 15.5% in the first quarter to 25.2% in the second quarter.  Norman H. Asbjornson, CEO, said, "As expected, our gross profit has started to recover as we've entered our peak season. We are working hard to improve our gross profit by closely monitoring our raw material costs while reviewing our supply chain. In addition, we are working to increase our production levels to help absorb overhead."

Selling, general and administrative expenses increased 9.3% to $13.1 million (11.9% of sales) from $12.0 million (11.8% of sales) as compared to the second quarter of 2017.  For the six months ended June 30, 2018, selling, general and administrative expenses  increased 3.6%  to $23.3 million  (11.2%  of sales) compared to $22.5 million (12.0% of sales) for the same period a year ago.

Mr. Asbjornson continued, "Our financial condition at June 30, 2018 remains strong with a current ratio of 2.2:1 (including cash and short-term investments totaling $24.3 million) and we continue to operate debt free."

Gary Fields, President, concluded "While orders were slower than expected at the beginning of the year, they have materialized as evidenced by our record backlog.  We are starting to see the impact of our November 2017 price increases and expect the subsequent prices increases will continue to strengthen our gross profit throughout 2018 and into 2019."

The Company will host a conference call today at 4:15 P.M. Eastern Time to discuss the second quarter results. To participate, call 1-888-241-0551 (code 8292427); or, for rebroadcast, call 1-855-859-2056 (code 8292427).

AAON, Inc. is engaged in the engineering, manufacturing, marketing and sale of air conditioning and heating equipment consisting of standard, semi-custom and custom rooftop units, chillers, packaged outdoor mechanical rooms, air handling units, makeup air units, energy recovery units, condensing units, geothermal/water-source heat pumps and coils. Since the founding of AAON in 1988, AAON has maintained a commitment to design, develop, manufacture and deliver heating and cooling products to perform beyond all expectations and demonstrate the value of AAON to our customers.

Certain statements in this news release may be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended. 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.

Use of Non-GAAP Financial Measures

To supplement the Company’s consolidated financial statements presented in accordance with generally accepted accounting principles (“GAAP”), an additional non-GAAP financial measure is provided and reconciled in the following table. The Company believes that this non-GAAP financial measure, when considered together with the GAAP financial measures, provides information that is useful to investors in understanding period-over-period operating results. The Company believes that this non-GAAP financial measure enhances the ability of investors to analyze the Company’s business trends and operating performance.

EBITDAX

EBITDAX (as defined below) is presented herein and reconciled from the GAAP measure of net income because of its wide acceptance by the investment community as a financial indicator of a company's ability to internally fund operations.

The Company defines EBITDAX as net income, plus (1) depreciation, (2) amortization of bond premiums, (3) share-based compensation, (4) interest (income) expense and (5) income tax expense. EBITDAX is not a measure of net income or cash flows as determined by GAAP.

The Company’s EBITDAX measure provides additional information which may be used to better understand the Company’s operations. EBITDAX is one of several metrics that the Company uses as a supplemental financial measurement in the evaluation of its business and should not be considered as an alternative to, or more meaningful than, net income, as an indicator of operating performance. Certain items excluded from EBITDAX are significant components in understanding and assessing a company's financial performance. EBITDAX, as used by the Company, may not be comparable to similarly titled measures reported by other companies. The Company believes that EBITDAX is a widely followed measure of operating performance and is one of many metrics used by the Company’s management team and by other users of the Company’s consolidated financial statements.

The following table provides a reconciliation of net income (GAAP) to EBITDAX (non-GAAP) for the periods indicated: