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Aaon's revenue of $79.3 million was up 12 percent from the third quarter of 2007, and profits rose to $8.35 million, up 55 percent from the same period last year.
CEO Norm Asbjornson said higher-than-expected profits came from price increases combined with a drop in the price for metals such as copper and steel.
"We didn't expect material prices to drop like they did," he said.
The company makes rooftop heating and air conditioning units for mostly industrial customers. It has about 1,000 employees in Tulsa.
Along with price increases, sales also increased during the quarter, said Kathy Sheffield, vice president and chief financial officer.
The economic turmoil has been hazardous for many manufacturers as customers nationwide reassess expansion plans. However, a large chunk of Aaon's business comes from stable sectors like hospitals, schools and hotels, Asbjornson said.
Keith Goddard of Capital Advisors in Tulsa said Aaon has benefited this year
from its line of environmentally friendly air conditioners and its reputation has a high-end product with long-term savings.
But company officials warned that the rest of the year might not be as favorable as the third quarter as suppliers pass along price increases and more uncertainty clouds the economy.
During the quarter, Aaon's backlog of orders dropped by about 5 percent, and a Canadian factory that Aaon bought in 2004 continues to weigh on profit margins, Asbjornson said.
Aaon's sales could also be hurt by slower sales to important customers in the residential and office construction sectors, Asbjornson said. Those sectors have been battered by credit market problems and slumping consumer confidence.
"Our whole concern is the same as yours -- what's going to happen in the marketplace," Asbjornson said.
The record earnings helped Aaon stock beat analyst estimates by earning 47 cents per diluted share, a dime more than expected.
In trading Wednesday, Aaon stock gained 26 cents, or 1.46 percent.
Kyle Arnold 581-8380
kyle.arnold@tulsaworld.com
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