AAON - Earnings call transcript Q3 2018

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Operator

Hello, my name is Phillip and I'll be your conference operator today. At this time, I would like to welcome everyone to the AAON Inc.

Third Quarter Sales and Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session [Operator Instructions]. you. Thank would the I your over to Mr. host, like now call turn to And Fields. Gary ahead. go please Sir,

Gary Fields

Good afternoon. with provisions Safe to the necessarily any Reform not I'd forward-looking like Litigation including of remainder statement the disclaimer. historical, of pursuant such Act presented the extent of To and the Securities herein statement outlook made Harbor deals the information year, is read that XXXX. for the is forward-looking the to

events to from filings, subject in control the Form see is outside it Form many results materially AAON's recent including could of differ the such, on on Report those XX-Q. XX-K AAON's cause SEC As Annual our most contained that the occurrence and report Please the risk to factors anticipated. quarterly

turn I over to details. would Asbjornson, CFO the to some now, Scott like discuss to of financial it So

Scott Asbjornson

to Net call. results XX, XX, are our XXXX. conference the of Welcome $XXX.X sales. million quarter down decreases rooftop million. Net three mainly from unit I’d XXXX months the comparative sales in to by September for sales to X.X% ended like to discussing $XXX.X due the September were versus begin

decreased million million. from to gross X.X% $XX.X Our profit $XX.X

quarter to continues profit from in Selling, material XXXX. The of just percentage raw million in in The in costs tariffs to increases in to compared XXXX. administrative and in previous gross As general a restrictions. experience expenses ended the and million to in trade Company increased quarters $XX XX.X% was profit Company $XX.X XX% due to X.X% sales, its gross compared improvements the XXXX. saw third quarter

of in operations increased XX.X% ended of to SG&A million decreased in from or or of sales XXXX. percentage a to just XX.X% XX.X% from million sales, from $XX.X of sales $XX.X sales. XX.X% XX.X% Income quarter As the total

was effective results tax the decreased net sales The excluding lower corporate share rate rate were million to for in Act which tax the was in lowering versus per are earnings Diluted XX, Jobs our compared to approximately ended from per nine XX,XXX,XXX XX.X% annual Cuts quarter percentage X.X% Tax water on million million; events, XX%. same of September months sales be to to source were estimated XXXX, sales decrease margin, rate, nine XX, Diluted shares the X.X% income net versus million the to tax is heat line, due discrete XXXX effective share. causing a to decreased and XX, up XXXX units. The Company's in rate percentage $XXX.X XX.X%. or that XX%. from increase the decreased shares the mainly XXXX; not XX,XXX,XXX total of based a up year from on $XXX.X $X.XX to in The Net effective expected our the of in profit share enacted per to $X.XX ago. proportion per XX.X% the by pump $XX.X months XXXX. net sales ended due December in or increased federal increase has September share to earnings XX.X% of $XX.X sales to Our

profit decreased gross Our $XX.X million. million $XX.X XX% to from

a of to In Company compared of was the million, per federal XXXX. from as January $X.X by cost XX%, of XX% Cuts corporate Tax as as increased As a tax the taxes and rate bonus one-time in to result all XXXX, Jobs act, and gross the a percentage sales, of benefits. Act, XX.X% paid lowered XX.X% which the $X,XXX excluding employees profit employee bonus sales

a of production. quarter higher end and XXXX of Company Additionally, anticipation the business. through of maintained has in being workforce the The Company of fourth XXXX lower and first typically in in level sales the beginning with seasonality workforce its our and growing

the administrative quarters in events increased quarter. Company's occurred of general occurred had the profit X.X% million XXXX, and the still third first and gross Selling, recovering expenses in from While the significant XXXX. from to is second improvements million in $XX.X $XX.X

SG&A million compared just overall decrease of to in was sales. from to XX.X% sales, to the from As of of of XXXX. decrease due in a profit XX.X% of decreased million sharing, the which The in operations sales total of XX.X% percentage is sales sales lower the earnings XX.X% primarily $XX.X to for result decreased year. or as Income percentage XX.X% SG&A $XX.X or a

tax rate Net were ago. Company’s $X.XX XX%. was the share X.X% is income was earnings per earnings estimated XXXX. Jobs XX,XXX,XXX Diluted our to in XX.X%. year approximately events, shares the on the Cuts enacted from rate, rate tax Tax Diluted decreased XX.X% share. The December from annual per $XX discreet XX, be a versus decrease XX%. in million effective decreased sales effective million in per of federal to XXXX XX% based to by to $XX.X XX,XXX,XXX and decreased period Act rate The to Our expected excluding effective lowering $X.XX to to XXXX shares corporate or sales that XX.X% tax of share compared or on share same per due

current Gary share XXXX equity XXXX; to XXXX; we XX, to of fields, our remainder December and at free. with XX, XX, of $XX.X at outlook call of balance the XX, million $XX.X results the President, see a for maturities is September $X.XX approximately for had now, compared over, debt expenditures be one at sheet; our continue million and to $XX detail I and year. the year that turn to will remain our products like X.X:X; two And ratio Looking is new Company expect shareholders' who the months; stock diluted discuss year-to-date; December per the along expenditures further XXXX; ranging the month at and $X.XX repurchases totaled million investments the we capital $XX million million; working you'll million; $XX.X versus cash balance to were our September from we approximately investments had at capital $XXX.X capital

Gary Fields

a Good and on are have effect shipped. are sales X.X% aluminum They price same for actual The the related impact effective equipment time, for X.X% increases other net accretive be that The those into afternoon. our are Orders Water to the heat price pump to over to we the business pressures a is into that's certification increased is beginning had due few AHRI beginning increases up coming somewhat The the gone becoming we We've this to at expected. ago. cost offset source are decreased some quarter. market year-to-date. momentum. of next that increased from tariff that we and now rate We the achieved we costs. we've have increases door margin effect regaining our are put costs months price percentages. to look increasing gain and that deal At quarter. component in all the

efficiencies other We legacy some gain products to gain strategies. have and some to of our operational redesigning been

had One in operational that strategies is participated of those business. not we previously the grow

business. As foothold products and marijuana was make has many and a many in well has very gain of so legalized substantial to in medical to some our states, equipped small AAON facilities very prompted very this emerging -- know, you modifications specialized demand and been that new these environment. and forth a a have for

just healthcare, products The up XX-XX. on remains production gained mentioned, fairly gaining. as one as The previously, source the but growth it's expectations, machines. new are Two of lagging have with that facilities and I still well Our and manufacturing, markets market material the as education, increasing as commercial speed in of continued heat toehold, replacement not steady; fairly of had track an share, various any about grow is building, somewhat, steady medical behind large I versus office seeing beginning we gaining in those pump, have at get our changes support segments municipalities market coming overall data business. construction remained tonnage center some mentioned water We've to another is our lodging; to market those. retail

in the So furnish that order the equipment while quarters of many areas and in needs pressurization center, for in maintain support to those. cooled typically to there’s UPS be have don't that humidity data and temperature we core equipment

So we’ve accounts really as with some gained focus. a nice that

ago. was versus a backlog $XXX.X at year September XXth Our million million $XX.X

achieved struggling to increase. strong to the rates we've So order while production year, we’ve that get the been this reflects intake this

not some We that, rapid as with the making are it's as but been the headway intake. ascension order of

we'll increasing source of see production. heat water XXXX, the remainder pump So

We our are complete R&D about to lab.

further Meeting We for revised brought is on back individuals lab. to have approximately not October our profit certain utilize aspects a gross Sales lab. and now levels. are expenditures a at sales usable time. to this throughout for quarters, right of that we real The that quarter-over-quarter has improvement partner to upcoming that look XXXX, and historical Xst that been lab game The XXX million near going National introduced the We channel improving in be have and big them we this $XX This changer year of to for approximately getting in our at had begun if capital be we’ve the this business.

We XX,XXX,XXX, air was do completing upcoming the I think left facilities, a had new we which water units. and talked our site completing to up things yet. spent about or manufacturing one source had to are few date the lab handling at time heat

heat get other gone think source be an on that maturity for saw, and around gain We’re bit. little get the on position still It’s going finger we as our pause business And business But that I us our you some cash able things to it's water a prudent utilize to streamlined for little as the will pump button down here. there also, to a in while. here. keep a development exciting

like business. expansions I'd position up like major for our air we before the other handling I’ll that, questions. pursue so, cash unit And to it any With open strengthen

Operator

the first Instructions] Joe line Mondillo. Your from question [Operator is of

Joe Mondillo

I I about guys increase the caused to productivity, productivity to second by imagine, quarter only so lower from wanted lower about you X%. ask sales --

you backlog sequentially, revenue the despite strong and saw X% productivity. because So lower that's of growth

XXX because and of sequentially On hand, saw basis that the by productivity. your other points, margins you improve

very of revenue you of just productivity. productivity So good wondering I good but am if was distinguish because because could was margin why not

could you clear that If up?

Gary Fields

Well, two there's there. factors

plant One to just enabled. was finally on the all to X% increase way is lead back price that fully from the the in that due effect believe had we went quarter And to get across some and backlog increase that November. to I took that times, it price of floor. its found board to third them the into November way

So part it. that helped of

with it of second to ramped while number considerable of a almost And actually trying distracted that disruptive, in they they people part the train other number The added ended-up that being the the up we these and is -- quarter, staff. plant we do, we them. what of little people, were an do came in people to knowledge because equal how of to

So nothing. we those that helped throughout reasons, attrition because this did attrition weren’t the we allowed so equipment staff staff previous in shrink third people place us like took as to that on doing efficiency, that almost floor amount paying it with the build the Yet, same for plant various that quarter was our exactly quarter. they the for said you of smaller able somewhat,

Joe Mondillo

that the At making improve? to then time, June this And price starts improvement improvement increase get sales productivity we so here. hitting. we're you of that increases -- Should then that taking that’s on the the place, with top and same price is anticipate daily

price it amount maybe and gross like good productivity margins should in a So, boost the fourth the seems quarter? increase

Gary Fields

of both those. agree Joe, with I

increase for in to backlog that everything that First at XX% time price. in be price build off, XXth the about door. will we we'll quarter, Due the new effect get lead we of we a had to coming and into on fourth went orders XX% second June

net So we build, X% in we you that math June. increase gets call board gain it X%. of was the that what a the of and If XX% price across do we

third ended. the there other for we real steel, to tariff of had things on keep steel without impact note all that that the is, are way from got us quarter contracted Now, through any having

fourth be purchasing we'll the price. price, inflated the in at So steel new quarter

all aluminum from we along. Now, pressures have had

offset we components XX big would and items. most tariff The some contactors like XX component days, had increased that It small say, will able be prices. capacitors, pressures and from was now more. So XX% to into not that. effect, on in We've went XX like something accessory items days last the another recent I to

I in think X% usable rates. increase the Then increased So materials about the we'll half the And fourth escalating price of about in of we'll the have that. December take up have quarter. summary, in some that Xrd wage will

and we'll curve rising increases price so a quarter, increases our wages, that some month bit But the have the we salaries now versus of So top of are of the with regards wage very on more rate those last cost. to are absorb that. our

continue So, I a improve. statement our to very valid that think margins will it's

basis going out it. Now, basis, It's a an of daily have improving. on it's increase on drastic, far as daily October, a as month per day productivity, -- in in we of been the not the door but dollars seen been

And the the get actions to door and things lot We so of production it correct us a we these out tells that multiple are did that through things. did more effective. that

which of these process plant on-boarding enhanced training a for was One revised and workers. program and

this I'm quarter fourth very all said, So, marginal as being we'll well. that of improvement some confident see

Joe Mondillo

in I handlers two you and to the units try air issue wanted were comment mix? Roofs, And about large the December And type then combat and were of that. then an rooftop the was to beginning a how were you Could and also were maybe year-over-year year, think question, increase the quarter, actually on margin or somewhat and third of product down units I know its going I mix November parts. to talking price lower on in guess noticed I up. chillers ask I product

a two-part pricing mix question. product it’s kind of So

Gary Fields

address first. let's So, rooftop units

range a tons of from that We to have tons. rooftop go units two XXX

very threw units, as two very what slight units. units, the been steady, number ton larger been increased but tonnage has our material approximately nothing So far has have XXX as of change

to We equal didn't those much. down so XXX,XXX,XXX While dollars from bring XXX,XXX,XXX. dollars, the change went

Yet, down by were those XXX change. wasn't units XXX, much dollar there units. So

So number down But quarter. range, at the And their XX the went you to in ton expensive. the same the larger, increased going midsized XX of for have tell the are more am in their units units to units share I time, those units. and market

that XX above those well, -- So we've units about The they fifth margin go that are a tons -- lower really units. XX are units tons changed. that to The ones the that very margin product mix from tons are the nice the had XX on.

been on good improved And increases aggressive while those margin, our than price have them lower actually benchmark a still units. bit. However, the we've there's

total of you'll heat units X,XXX twice about. heat been up Now many up notice to X,XXX, almost from the talking that water another thing pumps source as with pumps. going number we've new built That’s we that

look XXXX, And period, last X,XXX X,XXX. XXXX, XXX in its units. a same nine-month the we at year-to-date this month on it in So compared to basis, built built year three same In we if you period XX.

rate So source we have more heat than doubled our water on production pump.

a growth orders that We’re seen we we've seeing of expansion in the supports order AHRI approval, increased our at continued rates what that have the a coming on substantially. Since rate that expected basis.

Joe Mondillo

million quarter, the and in above it maybe going $X.X $X bouncing quarter. seemed shot, temporary I’ll Could you bounced quarter. quarter. temporary the and explain and quarter that I that was was down settles a have what's else to in in be over the Last in if fell think $X then $X seemed again then it like it Lastly the levels? warranty it back here do allow first million on there's million historical to still third to second closer above But nature. remember and someone expense. in the year, up to it you And million to a down going like to first It was

Gary Fields

it down. is settling Yes,

ending versus So XXXX $X.XXX the September the three million XXth for million. was actual months spend was $X.XX

decrease had that we in quarter. So the spends have a in slight

$X.XXX re-correct me million million. versus spend was The Let $X.XXX that.

modest very spend. in So it was a increase actual

like up. a isolated came say, it and for you it has this bit However, back down went then

of for remedied to until it had we both one actually component we some weather those. couldn’t major some We identified and of have we two we paint We that right. And to that supplier. was repairs began the accrue occur the one that seasonal another repairs. spend actually due do knew money was concern, had to was Some got areas the a

that's of in rate that have one So we are the confident expense. we declining will a why

Joe Mondillo

will it's just remain to historically, $X saying was you you as going for a just of decline whatever reason. rates, you will to you so as percent it's historical clarify. quarter, a it are from percent when to elevated of mean your sales, Or will absolutely the levels? a -- do I -- say decline at going percent closer to sales, a sales, follow-up So say But elevated? When million to decline going warranty anticipate expense but it a of and declining decline or remain it closer

Gary Fields

Well, have off I the of will we're a and will it decline increasing first percent have to acceleration current. think think don't sales going I sales, in I because as an think

that the paid I paint point a were the curtail dollar pretty going one those also believe for. some because issue, to absolute a and there, whiplash. slight in to items resolved failed had spent, had that a on And Now, to call And was begin of -- actually, to that's paint your quickly slight mid-XXXX. fall that here the early primary last we that But a was paint with very in resolved issue the enlarge we we'll process then January, reoccurrence buy in this we year. it

small that like and But identified I situation just So, we a was reoccurred. that reoccurrence how there was it what a corrected and actually strange it as well. was very said,

component January. this fairly things year, expected issued manufacture procedure there. was actual had expectancy. We've an issue the we would done bulletin life substantial could One enable since more a Then -- with that that really was spent manifest of to was had that had we last we component and that have itself a a that reoccurrence occurred service early that two be issue isolated incident is in one paint the So no a resolved. in dollars absolutely back

procedure those our pay and so those, in had cure, were able reps we service you for apply if trickled bulletin And field to to will. that service as the

And so completed. that's also largely

completed things they workforce Now The what be. took both out we get It was actually just I to and what the seasonality thought would. took spend of those there dollar the of because the longer, thought resolve it problems. than longer total would to

Joe Mondillo

subside, that issue whatever paint the to as reserving forward, warrants that you going guess? well should related And as reserves you're I

Gary Fields

and But reserve respond slower method an will. accrual. to there a actual in little it accrual the Well, -- there's warranty it's the

to it So, data historical change. support takes more a

Scott Asbjornson

the for and this. over years got to that flow last little months to couple the a You've going take while it's flush is going What through calculation, has out. to happened a it's for XX

go and So, the if at does then back you're you the shipped when did you you warranty making costs, units look when versus and projection. incur

for that same a So out we'll future the before go having of of that way to those time we've amount calculation. problems in the got past without fall

we anticipate profits forward is reappear got to it. going that certain as we resolved -- does if as it to chance versus going products we when we don't happen a moving through not So, but off for we're and it the it's on and problem the saying really -- have we've keep reserve again that's our

Joe Mondillo

future terms that period. months And that Is how of that time anniversary to in decline? or does something or like starts view XX

Scott Asbjornson

to most shipped the I out the within last XX we of found we XX say would problems that months. units

Operator

the line Thielman. question next is from of Your Brent

Brent Thielman

of products for products, where increase versus much HVAC in Gary, guess traditional coming that $XX of for that it I million heat how you pump backlog. growth from? Could parse is it feel how out us much

Gary Fields

legacy it's of preponderance a say would products. I backlog, the in In

While source to beginning is pump the that accruing the not it’s backlog. on meter; a of preponderance the backlog heat water that’s register

Brent Thielman

opportunities you I out from fields commercial of market the terms you And mean newer there. market overall. some about in the of -- get feedback just What talked

there's actually your business. feel of accelerating looks a backlog, You are pace? like lot its the like feel bump in and a Does end markets reflective nice it of like the traditional --

Gary Fields

to It began see in feels like that acceleration May. -- we’ve an

the that we’re Our as were sum still why that first in they I actually take below what of There clear have months But total at not nine of forecast identified and we��ve January, forecast. March all for February sales if channels occurred to back was started to it year-to-date. in an forecasting January. XX% supposed year, factors their acceleration the was

forecast growth accurate their year had coming So XX%, quite in being XX% versus forecast XXXX. X% the perfect. about was being of this in within was what they door That said, orders

strength Beginning been So, see May, that there has here. in we to began there.

us Of of because course, little the June was increase. price a artificial for

then we as about was $XX determine Now, we backlog of the of as the would throughout actually the far and because the million quarter million this at quarter $XXX forecast as occurred occurred, it in at occurred second has looked all just the of that that in end the quarter third believed the pulled forward, orders have coming and million third that $XX how door.

me, Index, XX, of recently if Northeast me the row region, latest exact to XX look the we've believe reported is Architectural a in I it at overall, Billing around this been above it region have than in -- now growth. seems that I though right Now, for have I but is I which XX. don’t other months is number XX benchmark report. indicates the above find had front that was around number every the XX The of What

business to that our firm indicator nine So a months. going of telling the occur for us what's style is next for

and it's steady. say rolls each look to months out on, nine be So going I that month

were the opportunities scream about excitement. new saw the our laboratory, on. of additions we've excited product group went partners a had very the XXX Meeting. high-pitch When sales that individuals the a saw market meeting, new were enhancements all was along tenor product done, came And channel We going at were here for the sales sales in before Our a meeting, National month in. we they what the what and of last they they doing to and approximately Sales with

that's irregardless their growth their more you their to long results less got their sales more of of the this partners, excited, for in of I somewhat for line firm market and this going we about for support manufacturers sales think we’re us that sheet if doing involved, when then your time, channel time, us. because are time have what So more of what on time get a so does, get the other

Brent Thielman

near the talked another business, about labor with that in on challenges do my guess open of here go the do place, term? coming? hiring just you factories feel have before need through in issues. and like coming? Do you that this growth those need you like a looks and tranche the looks what you the it in and is like have you place, market, it we’ve And growth feel question constraints in support coming it growth you’ve you like some what that factors worked the in need it's you of to support foresee I the the looks

Gary Fields

Well, we at our in so be of growth mind then times. overstaffed. bit first short staff-up results seemed swing to that personnel that, as huge first on I somewhat and some did we in order. I meet the swing this was people damaged result was think hesitant came basis, that the a in those in need up might it a to because in Well, that quarter have What in quarter orders and I forecast because little incremental incremental all tried add it to came we to

of do over percentage that we made -- I control. an that XX%? was add what the know just don't So incremental effect out add

Scott Asbjornson

XX%. it Out was over peak, of the

Gary Fields

The time. over at of couldn't up the it. added we people one just on-boarding those XX% to task. effectively, weren’t we do Yes, We task

be In back further our in which the I can we're gone with, something And are what improved looking quarter with we've that with a we producing ever people XX%, effective than reasonable are more margins. dollars then October, we has day third the and more we done improved down about in rate more at versus we on-boarding is roughly individuals a managed that occurred I'm to just peak, where October, proved at per And what guess. that approach again. XXX So, we've produced. we've

order the fact on and rate it controlled out disruptive so need effectiveness that be more yes, we have of existing get So, to to to we but in gave that in to us workers. clarity people them other the add the not a do

Brent Thielman

me, then And behind months. over for orders go. maybe with you're target for from for us thinking more it in pump you all everything's in like certifications frame Are systems about seems here you, helping one the revenue the the pump comfortable, coming order next the XX

Gary Fields

X there just yet X.X ago, between comfortable and from onto we two a was backwards When we went week, units and spread did to this the that a experienced is X shifts about went hour days there, anything declaring shift days not number on each per I'm seven three and weeks the we little hours were turned days because we a We XX a XX-hours. which things. of two that, some actually the personnel of week we producing. week

you on is little -- up were door in a our XX% orders I October, in that get tell maturity What a until will give So September. coming more I'm on were production the I schedule that of the to up dollars. workforce, little reluctant over any firm

we get got have to this resolved. So,

the I I think orders. prove guess remains and can but it We the that get that's them track to build get resolved, on on. We add color working final to we're to we're challenge. it we on got can a substantial that. just what

Operator

from the is question next line Brian of Your Gustavson.

Brian Gustavson

way, you you and coming quarter where Just maybe at capacity you different a about think this utilization where to? were can get you can just talk and

Gary Fields

we've already can million facility that in facilities a -- place run month. a have currently standpoint, determined Well, the we modifications with $XX no to from we

orders yet, that get orders those but get got ability we ability the personnel quite to rate we've qualified orders yet. at built. in to not We the What trained to don't get the have have the is

that And the that rate. then place facilities of to in here, unemployment a as in on people. X% maturity mind manufacturing were more do bear equipment in equipments So the the we range -- get these

talking craft the you're add people. trained, you So when of cream not people, them you about get even the when

from to place the manufacturing a talking on From right engineering, putting control, more some we as the capable from we’re in see business equipment have help it's great programs now best But handling per any than is of So out, us by, facility we of And I all I'm -- plant their been personnel actually floor. of standpoint new standpoint manufacturing basis to a put we able ability. engineering produce. a standpoint. production what business, a to goes from training constraints consider. about don't time utilize people should what or And our to that personnel on a a head staff these that these lot of quite may we've have other aspects all metrics

positions It's and up, better shape we've got get the that just manufacturing So this supervisory in the shape. in to to increase I think basic themselves good from volume. management workers we’re

Brian Gustavson

But that efficient -- capacity you’re from you’re quarter? this more as or the that into over like it summer sounds utilization improving becoming

Gary Fields

Very earlier, so. October we other like improvements I have some has achieved. us much that key shown And said

that with beginning the are on together working of lot a So group things his and HR been and to Scott control production group themselves. with I our have manifest

them you to successful broadly. once So then understand you what just begin utilize strategies are these more

Brian Gustavson

revenue or this you what you that -- that you could situation workforce have minus… do is with think the thinking per is quarter just plus masked But do now

Gary Fields

like improve order to right what something with the we’ve rate efficiencies saw direction. able able be in get be people to in just got that now. but got close that or it more moving to through We You might to I've really pretty the effectively onboard to X%

Scott Asbjornson

effectively depends to have. think number then we what those onboard total that we I well is increase of people how people say we want as the it and also

an we’re enough and about that trained we stabilize. really them and it people these just at. in is higher of X% getting can our and number raise So, that staff than issue getting beyond of where on It’s

Operator

have follow-up You of from the a Mondillo. [Operator Joe Instructions] line

Joe Mondillo

you're and longer related may anything the be delays Just from times, to production cancellations related wondering hearing your or in that, what customers to lead thoughts. any any

Gary Fields

Yes, was we've had interesting. zero And cancellations. it

a in One rain order of my can any the us, on and members day other impact hi, bit. of heavy and so rain me people some there'd that by said heavy my a been yes. What postpone did the those because said board for Coast, on Texas, if East thankfully, there'd And the was, that have so were I been on forth. hurricane, weather called had asked affected that you

been shuffle So more chronology them that that critical allowed somebody of that else's in order would've front to by us they later. was

have and expectations. we customers an relationship effort the with our managing amount spent inordinate their So of

circumstances. what very but you understand update more that we our make with you that frequently that what to at sure at want they all, the it's been times. I expected manageable to times tell are. tell I this lightly than We want aggressive to that I don't at publishing We’re lead under we’re take where lead

Joe Mondillo

higher related of terms of Do in order you it to know definitely was times. rates I lead think slowdown is the in of any most that a publishing And all? the some But the of price future put to period before to increases. order, waiting customers that think time any anywhere you there's in in an or forward like pull related going else that? anything at

Gary Fields

so, September than and Joe, bookings don't because came bookings. the October door orders higher I'm believe they're looking XX% at I No that in

Joe Mondillo

the have you? to improvement year-over-year happen in October. You don’t Do

Gary Fields

you of were tell that booked can right last within earshot exactly booking of all year. we've what now I

what going left go So for I we've bookings. three on increase like to look can on… we're got to it months

Joe Mondillo

is year-to-date last… you're October So through bookings similar about to

Gary Fields

of Hold to here, XXXX, just all on me it's it Norm detailed. really To pretty handed close.

Let of pull we're here million just, they've at think it me bookings so look in was me that long Yes. me -- quick changed because Yes, our all. think are so year-to-date it. pretty through the a I real look steady. don't they're let view X -- let together range I --

So few short entire XXXX, we're we're dollars that’s first out range thing booked our we million -- the a this the morning. came total of of as year -- report in that right now what just

forecasts stronger and got book those to and our yet we've December for November for had much strong, and very are than December we've before. So ever November

Joe Mondillo

So December from up and year-over-year you're and be anticipating December XXXX? November to November

Gary Fields

Absolutely.

going our so year, backlog be out finishing the extraordinary And is to it comparatively.

Joe Mondillo

-- I just or I in to in think else? anything want to wanted in place. say that price price the I increases. increases future there Is Also, clarify December the the Is is it place, you have you all that have just XXth

Gary Fields

had the product be in a June built to of XX% about increase price and actually quarter. XXth the X% due effective board we fourth time increase, on So of will that price backlog, lead across

that and quarter of than The sooner lead end So will tail floor of hit it Again, in predominantly increase about the might quarter, be December the the time plant be obviously second would it to into quarter. the X%. expect next any the middle second quarter, first on first the the the but There of the quarter. hitting due middle of hit in December backlog, XXX% the equipment goes I tiny second vast not a little to of Xth. majority the a price would effect Xth bit

Joe Mondillo

selected? that's across board price or And increase more the

Gary Fields

It additional effectively Longview so was When in is. back increase. changed the not that we all in on It -- just have went price was products needed. we I'll the to Longview, increase multipliers some had the did an price cumulatively we we X% June, we build we June, across board. that and X.X% products

Joe Mondillo

in Scott, say two tax just forward for And tax Did right? rate that anticipate then hear to things, the even, I be the you lastly, you probably the rate XX%. XXXX, go did

Scott Asbjornson

we That's point, what at yes. estimated this

Joe Mondillo

are CapEx the Is pushed you what -- to were early and anticipating. seems budget then originally too to ballpark tell? little it a it XXXX was into than lower or And thinking XXXX being a you be for is anything little

Scott Asbjornson

were beginning certain at together really still numbers get overestimate XXXX is so bigger at a this bit putting little point. And we the going We're and the always of different no we're to really, this done, what year year. maybe

off and everything trying pushed of into the management purposely completed. of haven’t significance get year. we to It's projects been anything So next just the

Operator

further this there’re time. questions at And no

Gary Fields

all thank questions. you we for Well, calls your Okay. and

end results. again So year to our February we Good speak day. will you in for

Operator

for conclude Thank participating. today's That does conference. you

You may now disconnect.

AAON (AAON) 1 Nov 182018 Q3 Earnings call transcript