AAON’s record profits heat up cold market

BY DEBBIE BLOSSOM Published: November 15, 2009
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/> "They make efficient machines, they are stable and have good financials,” Dollarhide said. "Even if the recession continues AAON will be around.”

Still, the recession has cooled business this year, Asbjornson said.

After a first quarter that saw earnings reach the highest of any first quarter in its history, AAON’s profits leveled off during the second quarter with a 9 percent decrease in profits as the economy and the construction market continued to sputter. The commercial building market supports residential construction, "and since residential has been down for a couple of years, that has dried up commercial building,” he said.

Second quarter revenues were down 8 percent in volume for both the Tulsa and Longview, Texas plants. The downturn also shut down a plant in Canada that specialized in custom products, although some of that work will shift to the Tulsa and Texas plants, he said.

There have been no layoffs, but open positions haven’t been filled, leaving the company’s workforce down close to 18 percent compared to peak employment. In Tulsa, a high of 1,040 workers is now closer to 900.

"We’re having a tougher time this year compared to last year,” he said, "But we’re still doing better than so many other companies. When the upturn comes we will have more to offer because we didn’t shut down development.”

But until commercial building rebounds, "the industry will struggle,” said.

Still, AAON will have an edge as buildings become more environmentally correct.

"From our standpoint, the energy consumption issue is a challenge and an opportunity at the same time,” Asbjornson said. "We’re probably one of the leaders in saving energy, and that is a benefit to us.”