Company Overview - AAON, Inc. is a global leader in HVAC solutions for commercial, industrial, and data center indoor environments, founded in 1988 [3] - The company designs and manufactures highly configurable and custom-made equipment, enhancing efficiency, performance, and long-term value [3] - AAON's products are marketed under the AAON and BASX brands, with headquarters in Tulsa, Oklahoma, featuring an innovation center and testing lab [3] Upcoming Event - AAON will present at the Sidoti Spring 2025 Small-Cap Conference on March 20, 2025, at 11:30 AM (ET) [1] - Key executives participating in the presentation include CEO Gary Fields, CFO Rebecca Thompson, President and COO Matt Tobolski, and Director of Investor Relations Joseph Mondillo [1] - Presentation materials will be available on the AAON website [1]

Core Insights - AAON, Inc. has announced a 25% increase in its quarterly dividend and a new $30 million share repurchase program, aimed at enhancing shareholder value during a period of market uncertainty [1][2][5] - The company's actions reflect confidence in its financial position and prospects, which may positively influence investor sentiment and stock price [1][8] Dividend and Share Repurchase - The quarterly cash dividend has been raised from $0.08 to $0.10 per share, resulting in an annual dividend of $0.40, up from $0.32 [2][3] - AAON's current dividend yield stands at approximately 0.39%, with an annualized three-year dividend growth rate of 8.10% [2][3] - The dividend payout ratio is 15.92%, indicating sustainability and potential for future growth [4] - The new $30 million share repurchase program is part of a larger $100 million initiative, demonstrating a commitment to rewarding shareholders through buybacks [5][6] Financial Health and Growth Prospects - AAON reported a backlog of $867.1 million as of December 31, 2024, reflecting a 70% year-over-year increase, which provides a solid revenue pipeline [9] - The company is strategically positioned in the growing data center market, enhancing its revenue potential [10] - Recent investments in capacity expansion, including a new facility in Memphis, Tennessee, indicate proactive measures to meet anticipated demand [11] - AAON's financial metrics include a strong current ratio of 3.06 and a low debt-to-equity ratio of 0.07, showcasing liquidity and a conservative capital structure [12] Market Performance and Analyst Sentiment - AAON has a consensus rating of Buy from analysts, with an average price target of $115.50, suggesting a potential upside of approximately 41% from a recent stock price of around $80 [8][18] - Despite a recent stock price decline of over 33% year-to-date and a 52-week low of $69.52, the company’s fundamentals remain strong [14][15] - The recent quarterly earnings report showed an EPS of $0.30 and revenue of $297.7 million, both of which fell short of analyst expectations due to industry-specific challenges [15]

Company Overview - AAON, Inc. is a leader in HVAC solutions for commercial and industrial indoor environments, founded in 1988 [2] - The company focuses on designing and manufacturing highly configurable equipment to enhance efficiency, performance, and long-term value [2] - AAON is headquartered in Tulsa, Oklahoma, featuring a world-class innovation center and testing capabilities aimed at advancing sustainability [2] Dividend Announcement - The Board of Directors has declared a quarterly cash dividend of $0.10 per share, which represents a 25% increase from previous dividends [1] - The next cash dividend will be payable on March 28, 2025, to stockholders of record as of March 18, 2025 [1]

Core Points - AAON, Inc. has announced a $30 million share repurchase as part of a previously disclosed $100 million share repurchase program [1] - The repurchases will be conducted according to pre-arranged stock repurchase plans under Rule 10b-18 of the Securities Exchange Act of 1934 [1] - The timing, number, and value of shares repurchased will depend on market conditions, share price, trading volume, and other factors [1] Company Overview - AAON, Inc. was founded in 1988 and is a leader in HVAC solutions for commercial and industrial indoor environments [2] - The company focuses on designing and manufacturing highly configurable equipment to enhance efficiency, performance, and long-term value [2] - AAON is headquartered in Tulsa, Oklahoma, and has a world-class innovation center and testing capabilities aimed at advancing toward a cleaner and more sustainable future [2]

Financial Data and Key Metrics Changes - Net sales decreased by 2.9% to $297.7 million from $306.6 million, primarily due to a 16.1% decline in the AAON Oklahoma segment, partially offset by a 129.9% growth in the AAON Coil Products segment [23][24] - Gross profit decreased by 30.5% to $77.6 million, with gross profit margin dropping to 26.1% from 36.4% in the previous year [24] - Diluted earnings per share fell by 46.4% to $0.30 from $0.56 [26] Business Line Data and Key Metrics Changes - The Basics brand saw a significant increase in net sales, up 35.1%, with data center equipment sales rising approximately 85% [15] - AAON branded equipment sales experienced a modest decline in the low single digits, but bookings were up in the mid-teens, and backlog increased by approximately 20% [17] - The AAON Coil Products segment reported a remarkable growth of 129.9% in sales, driven by the new Basics branded data center liquid cooling product [36] Market Data and Key Metrics Changes - The total backlog at the end of the year increased by 70% to $867.1 million, primarily due to strong bookings of data center equipment [18] - Bookings for the fourth quarter were up approximately 62%, indicating strong demand despite some challenges in the AAON Oklahoma segment [18] Company Strategy and Development Direction - The company aims to drive sustainable and robust organic growth, targeting over $1 billion in data center equipment sales within a few years [47][85] - The strategic focus includes being an industry leader in innovation and customization, with significant investments in new technologies and facilities to enhance production capacity [42][49] - The company is reorganizing to efficiently manage growth and maintain operational efficiencies while expanding manufacturing capabilities [50] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2024 was a challenging year due to regulatory impacts and a transition in refrigerants, but they expect a rebound in demand as the market stabilizes [53][54] - The outlook for 2025 anticipates sales growth in the mid to high teens, with expectations of improved margins as production ramps up [57][58] Other Important Information - Capital expenditures in the fourth quarter were $99.3 million, significantly up from the previous year, with a total of $213.2 million for 2024 [28] - The company is investing heavily in the new Memphis facility, which is expected to enhance production capabilities and efficiency [101] Q&A Session Summary Question: Outlook for Oklahoma sales in Q1 - Management indicated that flat sales are expected due to inventory of R410A affecting momentum, with a transition to R454B impacting the run rate [62][64] Question: Reasons for Basics sales decline - Management clarified that while Basics sales were down, the overall demand and backlog for Basics branded products remain strong, with capacity limitations affecting production [66][68] Question: Growth expectations for 2025 - Management explained that while strong growth is anticipated in the data center segment, softness in the Oklahoma segment is expected to offset some of that growth, leading to a cautious outlook [71][75] Question: Data center market outlook - Management reported that the data center market remains strong, with continued investments and a positive outlook despite some market noise [82] Question: Pricing strategy for R454B - Management stated that they are monitoring the market for pricing adjustments related to R454B, with a focus on strengthening bookings before implementing any increases [126][130]