Aaon, Inc. · NASDAQ:AAON
Aaon — Investor Day (June 2025)
104 slides from Aaon's investor day presentation, Jun 10, 2025
Slide 1: Investor Day
Investor Day June 10, 2025
Slide 2: Forward-looking statements and other references
Forward-looking statements and other references Certain statements and information set forth in this presentation contains “forward -looking statements” and “forward-looking information” within the meaning of the Private Securities Litigation Reform Act of 1995. Except for statements of historical f
Slide 3: Experienced executive team
Matt Tobolski Chief Executive Officer Stephen Wakefield Executive Vice President & General Experienced Manager, AAON Business Unit executive team Matt Shaub Executive Vice President & General Manager, BASX Business Unit Rebecca Thompson Chief Financial Officer and Treasurer 3
Slide 4: Today's agenda
9:00am Welcome & Agenda Joseph Mondillo IR & Corporate Strategy Director 9:05am Company Overview Matt Tobolski CEO 10:00am AAON Overview Stephen Wakefield EVP of AAON Today’s BREAK agenda 10:45am BASX Overview Matt Shaub EVP of BASX Financial Overview Rebecca Thompson 11:15am & Outlook CFO & Treasur
Slide 5: Matt Tobolski
Matt Tobolski Chief Executive Officer 5
Slide 6: Who we are…
Who we are… We are an entrepreneurial We are not your disruptor with a focus typical HVAC company on providing value for our customers We are agile, We are best-in-class innovative & creative operators to support it …that’s why we consistently outperform 6
Slide 7: AAON: an overview
AAON: an overview Founded in 1988 At AAON, we don’t just respond to the world’s demand for better solutions—we lead the charge 4.0 million sq ft of manufacturing We are dedicated to advancing the HVAC industry with efficient, cutting- edge technologies for commercial, industrial and data center buil
Slide 8: AAON: an overview
AAON: an overview AAON Coil International Products AAON Sales by Sales by Sales by branded segment region BASX products BASX AAON U.S. Oklahoma $1.0B 31.0% 21.1% 21.6% $1.90 16.7% Order backlog Gross margin EBITDA margin CapEx and R&D as EPS ROIC a percent of sales Note: Data is based on trailing tw
Slide 9: Our strategic pillars
Our strategic pillars 01 02 03 04 05 Winning with Optimizing the Capitalize on the Capitalize on Be a best in superior organization to value proposition industry leading class operator and engineering, drive results and of our mission innovation and make strategic innovation, empower critical soluti
Slide 10: Winning with superior engineering, innovation, customization and automation
Superior engineering and Winning with superior quality = longer life and efficiency engineering, innovation, customization and Industry leading automation customization for customer needs AAON delivers unmatched efficiency, customization and quality, driven by automation and engineering excellence A
Slide 11: Reorganizing for sustainable growth
Reorganizing for sustainable growth WHAT WE’RE DOING BENEFITS Transitioning from a facility-based Heightened focus on driving value in organizational structure to a products and customer execution brand-based structure Better leveraging of manufacturing scale and best practices WHY Enable investors
Slide 12: Future structure: Leveraging two strong brands
Future structure: Leveraging two strong brands Non-res HVAC Data centers, clean rooms, equipment commercial/industrial Innovation Air handling, liquid Packaged rooftop Premium cooling, cleanroom units and split quality and environments 74% customer 26% of Sales of Sales support Semi-custom Fully cus
Slide 13: BASX wins with a full custom solutions offering
BASX wins with a full custom solutions offering BASX has had a three-year CAGR of ~40% in a market1 growing ~10% Superior engineering Purpose built for data centers Solving complex challenges Solutions- with advanced technical Fully customizable and based approach capabilities adaptive to a fast-mov
Slide 14: BASX's focus and opportunity is data centers
BASX’s focus and opportunity is data centers Leveraging existing air-side DC cooling and newly introduced liquid cooling solutions Air-side DC cooling Liquid DC cooling Highly engineered, BASX is leading the industry in custom designed capabilities are developing these innovative a proven success fa
Slide 15: Dynamic growth in the BASX backlog
623.0 539.7 Dynamic 394.5 408.6 growth in the 279.8 BASX backlog 182.0 170.7 183.5 233.5 149.8 147.6 ($M) 99.9 69.6 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 15
Slide 16: Expanding and diversifying solutions
Expanding and diversifying solutions BASX is creating a new semi- custom, configurable product offering, similar to AAON This offering would be more custom than most standard offerings in the market, but more cost effective than a fully custom solution 16
Slide 17: BASX's future is bright
Growing TAM Solutions-based, as opposed to product-based Custom engineering and BASX’s future manufacturing is bright Leading innovation in both air-side and liquid cooling Premium customer service Strong backlog supported by expanding capacity 17
Slide 18: What does the AAON brand represent?
Multiple drivers of growth • Most superior rooftop and split systems on the market • Industry leading innovation • Premium quality • Advanced technology and performance What does the Leading value proposition for customers AAON brand • Lowest total cost of ownership represent? • Not just upfront cos
Slide 19: Favorable secular market trends
Favorable secular market trends Decarbonization/ Regulation Economics electrification Customers’ attractive Focus on energy efficiency Stricter regulation, such as total cost of ownership of and electrification has lower GWP refrigerants, has our products have driven a replacement cycle been a drive
Slide 20: Capitalizing on innovative heat pumps and national account opportunities
Capitalizing on innovative heat pumps and national account opportunities Recently, AAON established an internal TAM national account sales team SAM Targeting national accounts and their multi-year replacement programs from a centralized standpoint expands our SAM Existing Leveraging heat pump capabi
Slide 21: The refrigerant transition was disruptive in 2024…
The refrigerant transition was disruptive in 2024… Unprecedented regulation by the EPA was disruptive in many ways Transition to a new mildly flammable refrigerant (R-454B) forced an update to building codes, the first time in history this happened during a refrigerant change Slow adoption of the ne
Slide 22: …But it was temporary, and AAON's competitiveness has never been stronger
…But it was temporary, and AAON’s competitiveness has never been stronger We were always confident this was going to be a temporary impact AAON’s cost of manufacturing the new refrigerant equipment is unchanged, whereas most competition has indicated increases to costs This has led to AAON being mor
Slide 23: Our premium offering has never been more attractive
Our premium offering has never been more attractive The price premium Our unique product offering, to peers¹ has narrowed unmatched by competitors, proves to be of higher quality relative to market alternatives, justifying a price premium 15-20% The value proposition has never ~10% been more attract
Slide 24: Fundamentals of the AAON brand are the strongest ever
New storyboard Leading innovation with high barriers to entry Competitive value proposition Fundamentals Favorable secular trends of the AAON with a ‘Made in America’ advantage brand are the strongest ever National account opportunity Cold climate heat pumps Operational excellence 24
Slide 25: Being a best-in-class operator
Being a best-in-class operator Delivering steady improvement in gross margin 34.1% 33.1% 30.3% 25.4% 25.8% 26.7% 23.9% 2018 2019 2020 2021 2022 2023 2024 25
Slide 26: Balancing and expanding our manufacturing footprint
Balancing and expanding our 1 Tulsa, OK (2.0M sq ft) manufacturing footprint Longview, TX 2 (791,500 sq ft) 3 Redmond, OR 3 (363,000 sq ft) Kansas City, MO 4 4 (86,000 sq ft) 1 5 Memphis, TN 5 (787,000 sq ft) 2 All facilities are set up with similar manufacturing equipment and processes 26
Slide 27: Future state of production
Future state of production Tulsa, OK 95% 5% Longview, TX 25% 75% (250,000 sq ft of expansion) Redmond, OR 0% 100% Kansas City, MO 80% 20% Memphis, TN 5% 95% (800,000 sq ft of expansion) 27
Slide 28: Building capacity for efficient growth
Building capacity for efficient growth In our view, the data center HVAC supply Added capacity: chain will remain tight for years 2022-2024 Prioritizing aggressive growth Three largest in an efficient way peers combined ~1M sq ft total incremental manufacturing space • Designing our first ideally ar
Slide 29: Investment thesis
Investment thesis Leader in Capitalizing on Robust growth, innovation Customized decarbonization with strong with high barriers solutions provider and data center margins and to entry and balance sheet opportunities competitive pricing 29
Slide 30: Delivering on our commitments
Delivering on our commitments Sales CAGR Gross margin 16%¹ 33% 10%+ 30%+ 2023 investor day 2024 2023 investor day 2024 ¹ 2022-24 CAGR 30
Slide 31: Affirming our 3-year targets
Organic sales Affirming CAGR 12.5%-plus Gross margin our 3-year 32%-35% targets mid-single ~40% digits Note: The three-year organic sales CAGR is assuming a base year of 2024. 31
Slide 32: Stephen Wakefield
Stephen Wakefield Executive Vice President & General Manager, AAON Business Unit 32
Slide 33: Key takeaways
Key takeaways Leading in innovation featuring products like Alpha Class Solutions-based customization from a best-in-class operator Narrowing price premium allows us to take market share Strong sales channel with a push into national accounts 33
Slide 34: AAON brand overview
AAON brand overview AAON brand sales ($M) 6% 8% Parts 12% Condensing units Longview, TX 1,002 976 771 Sales by Sales by 6% Air Products¹ Location¹ handlers 80% 88% Rooftop Tulsa, OK units 2022 2023 2024 History Today Bridging the gap between basic, standard equipment A semi-custom, highly configurab
Slide 35: Products to meet a range of customer needs
Products to meet a range of customer needs Packaged Outdoor Packaged Rooftop Rooftop Air Rooftop Unit Handling Unit Unit 2-6 tons 800-2400 cfm 9-15 tons Vertical Indoor Packaged Condensing Air Handling Rooftop Units Unit Unit 2-60 tons 450-10,000 16-30 tons cfm Horizontal Evaporative Packaged Indoor
Slide 36: What makes the AAON brand special?
Innovation and engineering Leading in innovation and engineering is at AAON's core, and it enables us to fully support all our customers Semi-custom engineering & manufacturing What makes A proprietary, hard-to-replicate process that seamlessly integrates deep customization within a highly automated
Slide 37: Our competitive advantage: The unique integrated process
Our competitive advantage: The unique integrated process 1 2 3 4 Sophisticated Most capable R&D Electronically Efficient engineering lab in the industry accepting many manufacturing department for configurations through automation design of equipment and soft tooling High barriers to entry with a mo
Slide 38: AAON equipment versus the alternative
AAON equipment versus the alternative Feature Low-quality products AAON’s custom products Mass production, Soft-tooled, highly Production standardized process automated processes Premium, reflects Price Affordable, budget-friendly higher quality Not as durable, shorter Durable and long-lasting, with
Slide 39: The Norman Asbjornson Innovation Center
AAON is able to test units much greater in size than AHRI¹ can AHRI can only test and certify units up to 63 tons because they do not have the testing capacity that we do The Norman Statistics 134,000 sq ft 7.25 megawatts Asbjornson Innovation Operates 39 30 7 days a week, Staffing Center test techn
Slide 40: Proving and showcasing AAON's superiority
Proving and showcasing AAON’s superiority The Gary D. Fields Exploration Center is the only showroom in the world where customers can see all the major brands of rooftop equipment side-by-side, with our products next to the alternatives It doesn’t take an engineer to quickly understand the premium q
Slide 41: Offering a solutions-based sales channel model
Offering a solutions- Sales reps use AAON equipment based sales channel to customize the ideal solution model AAON sells through an independently owned sales channel, with one representative firm in every region of North America Reps utilize a line card of 20-30 complimentary OEMs that help provide
Slide 42: Building strength in our go-to-market strategy
Building strength in our go-to-market strategy Leveraging the Focus on parts Providing resources Investing marketing function and service to the sales channel in sales set up in 2022 AAON selling parts and Customer Exploration Center Account management Marketing budget up 10x supporting our sales ch
Slide 43: Total addressable market and share gain opportunity
Total addressable market 6% and share gain opportunity¹ market share and growing Nonresidential HVAC market $14.5B² The addressable market of mid-single AAON’s commercial HVAC products, including digits rooftop units, air handlers and condensing units, is ~16x the 3-year sales target size of our roo
Slide 44: Favorable secular trends
Favorable secular trends Total cost of Decarbonization Energy efficiency Government regulations ownership focus Our customized, highly automated These secular trends are driving up the cost platform allows us to adapt to these secular of manufacturing across the industry much trends much more effici
Slide 45: Continuously becoming more competitive
Continuously becoming more competitive As the price premium narrows, we expand margins and increase our market share Prior to 2020, In the last few years, In 2025, AAON’s average price premium we are narrowing the the company was able to bring relative to the alternative price premium further, that
Slide 46: Operationally, we've never been stronger
Operationally, we’ve never been stronger Productivity gains and scaling the operations efficiently AAON Oklahoma gross margin transformed 30.5% 35.2% Continuously finding ways to increase productivity and 2020 throughput 2024 At the Tulsa facility, we could increase production volumes by ~40% with m
Slide 47: A history of innovation
A history of innovation Innovation of premier solutions is the foundational principle of the company 1988 2003 2012 2022 First configurable Foam-filled Low leakage Zero degree semi-custom double-wall panels dampers heat pumps rooftop unit 1998 2005 2015 2025 Dimple heat Dedicated outside Variable sp
Slide 48: Continuing to innovate with Alpha Class and heat pumps
Continuing to innovate with Alpha Class and heat pumps Alpha Class 2023 is a product category of the AAON’s Alpha Class were the only heat pumps operable ~15% AAON brand that includes below 30OF, and were operable all the way down to 0OF of rooftop commercial HVAC sales¹ equipment fueled by a fully
Slide 49: National account opportunity
National accounts In the last were not a big focus 20 years National Began to target account national account opportunities In early In2024 Early opportunity 2024 Built a pipeline of opportunity with annualized sales of several hundred million dollars Last 18 months A substantial percentage of Landi
Slide 50: Impacts from the recent refrigerant regulation
Impacts from the recent refrigerant regulation Planning production and management inventory was incredibly challenging On a positive note, our semi-custom platform was able to handle the transition better than most of the competition The weak Q4 and Q1 we experienced was temporary Our YTD book of or
Slide 51: Our bookings are recovering from the refrigerant transition
Our bookings are recovering from the refrigerant transition AAON backlog ($M) 417.9 403.9 391.8 400.5 364.1 364.9 355.5 327.3 307.1 276.6 278.6 255.5 239.1 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 51
Slide 52: Key takeaways
Key takeaways Leading in innovation featuring products like Alpha Class Solutions-based customization from a …leading us to a best-in-class operator MSD sales growth Narrowing price premium allows us target for to take market share AAON brand Strong sales channel with a push into national accounts 5
Slide 53: Break
Break 53
Slide 54: Matt Shaub
Matt Shaub Executive Vice President & General Manager, BASX Business Unit 54
Slide 55: Key takeaways
Key takeaways Fully custom solutions - providing innovative solutions, not just products Premier customer service - setting the industry standard for customer experience Aggressively capturing market share – leveraging our unique offering to take share from a large, growing market Robust growth - ge
Slide 56: BASX brand overview
BASX brand overview BASX brand sales ($M) 4% 13% Commercial 12% Cleanroom equipment Longview, TX 38% systems CAGR 225.0 166.5 Sales by Production 117.7 Product¹ Location¹ 83% 88% Data center Redmond, OR equipment 2022 2023 2024 History $623.0M Founded in 2014 and acquired by AAON in 2021, largely fo
Slide 57: BASX strategic plan
BASX strategic plan Platform Capacity Solutions Leveraging the BASX platform Focus on expanding production Developing solutions and to drive high win rates in data capacity and operational product offerings amongst center projects efficiencies to increase throughput diversified end-markets and maxim
Slide 58: What makes BASX special?
What makes BASX special? Provides solutions Full High quality Premier Superior not just products customization manufacturing customer care customer support BASX is the only player BASX offers a fully The manufacturing is of A foundational principle BASX focuses greatly on in the industry that custom
Slide 59: Elite engineering and innovation drives BASX
Elite engineering Focused teams for both customer and innovation solutions and product development drives BASX Dedicated R&D space for concept development, validation and customer witness testing Decades of experienced industry leadership Entrepreneurial and fast-paced development culture, blended w
Slide 60: Adding value through customized solutions
Adding value through customized solutions BENEFITS WHAT IS IT ASPECTS Innovative design to High efficiency / Total cost To customers To the facility customer specifications of ownership conscious Unique to customer Improves overall Innovative designs requirements facility performance Fully customize
Slide 61: High quality manufacturing
Superior fan and air handler designs Highly vertically integrated High quality Automated manufacturing manufacturing State of the art production facilities Durable, long-lasting equipment 61
Slide 62: Customer care and support
Customer care and support Providing the best customer experience Steadfast commitment Delivering on to customer service our promises Assigned project Premier management from aftermarket support day one Leveraging AAON's Utilizing internal sales, independent national engineering, production rep netwo
Slide 63: $175M order, Customer case study
Customer case study Late Feb Oct Since 2023 2024 2024 then A hyperscaler issued BASX secured a an RFP for a custom liquid cooling solution for innovative data BASX was selected as the $175M order, center design BASX has received EXCLUSIVE add-on orders in PARTNER significant size The solution utiliz
Slide 64: Data centers are a huge and growing market
Data centers are a huge and growing market Total North America data Total cooling equipment BASX-specific thermal center construction & infrastructure management equipment put in place in 2024¹ TAM TAM ~20% ~40% TAM ~7% ~$35B² $5-$7B³ $2.5-$3.0B³ ¹ The total cost of constructing data centers in 2024
Slide 65: Data center TAM is shifting to liquid cooling
Data center TAM is shifting to liquid cooling BASX-specific thermal Liquid cooling Air-cooled management equipment 40% Thermal TAM 85% management 15% By 2028 ~7% equipment 60% $2.5-$3.0B¹ To date, a vast majority of TAM By 2028 we anticipate the is cloud compute data centers split to be 60% liquid a
Slide 66: Data center pipeline underpins growth
Data center pipeline underpins growth In 2023, compute power of In 2024, it was ~4GW and currently, data centers put-in-place in there is a pipeline of projects in the industry was ~2GW development totaling 100-150 GWs Data center pipeline from a macro perspective Installed capacity (GW) 100-150 is
Slide 67: Long-term value creation of data center opportunity
Long-term value creation of data center opportunity 623.0 BASX backlog ($M) 539.7 394.5 408.6 279.8 233.5 182.0 170.7 183.5 149.8 147.6 99.9 69.6 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 Significant visibility into our Pipeline is large and growing, Demand outweighs customers
Slide 68: BASX product offerings provide end-to-end solution for data centers
BASX product offerings provide end-to-end solution for data centers Computer Room Coolant Air Handler Distribution Unit Overhead Air Handling Fan Coil Units opportunity is ~$1.0B - $1.5B per GW1 Free Cooling Heat Rejection Chiller Fan Coil Wall 1 Note:Opportunity is based on full utilization of manu
Slide 69: Leading in innovation with both air-side cooling…
Air-side data center cooling Highly engineered, custom designed capabilities a proven success factor Nearly all of BASX’s growth (3-year trailing sales CAGR of 40%, including 35% in 2024) has been driven by providing custom air-side cooling solutions for cloud compute DCs Leading in innovation Cloud
Slide 70: …And liquid cooling data center solutions
Liquid data center cooling Being on the cutting edge of liquid cooling is extremely advantageous in a rapidly evolving market BASX is a leading provider as shown by recent order wins …And liquid Liquid cooling is incremental growth to air-side cooling, as it is utilized in AI data centers cooling da
Slide 71: Shift to AI inference models will sustain growth
Shift to AI inference models will sustain growth Consistent growth despite concerns around Deepseek Low-cost models is a good thing, not a bad thing Transitioning from constructing training models to inference models will result in more data center construction BASX content in inference data centers
Slide 72: BASX production expanding across AAON locations
BASX production BASX production allocation by site (%) expanding across AAON locations 2024 2025 2026 2027 Redmond, OR Longview, TX Memphis, TN BASX’s production capacity will double by 2027, facilitating robust annual production growth Longview and Memphis will be transformational as they ramp up i
Slide 73: Status of BASX production at each location
Status of BASX production at each location Dedicated Max production 2024 % to full Facility BASX sq ft capacity sales capacity Current status Increasing throughput; Redmond, OR 240,000 ~$250M $198.1M 100% maximizing productivity Ramping up production Longview, TX 250,000 ~$500M $26.9M 70% in 2-3 yea
Slide 74: Margins to improve as utilization increases
Margins to improve as utilization increases Current state By end of 2025 By end of 2026 Right-sizing capacity at Volumes and productivity in Redmond facility and ramping up Redmond and Longview will production at the Longview and be meeting target margins Cumulative volumes and Memphis facilities pr
Slide 75: Memphis doubles BASX's production capacity
Memphis doubles BASX’s production capacity Facility with 787,000 sq ft, of which 490,000 sq ft is dedicated to BASX DC equipment Production to start in Q4 2025, ramp up in 2026 Flexibility with 297,000 sq ft of undedicated space: More data center equipment New solutions/products 75
Slide 76: Client segmentation
Client segmentation Enterprise Hyperscale Colocation Owned and operated by a single facility for its own use Dominated by tech giants Multi-tenant facilities Diverse customer Massive power requirements requirements Colocation (200+ MW facilities) Owned and developed by a third party and leased to Cu
Slide 77: Reducing our reliance on large customers over time
Large hyperscalers Non-hyperscale customers Reducing our reliance on large Today Future customers over time A few large hyperscale Hyperscalers will make up customers dominate a smaller percentage as the backlog we reach new customers 77
Slide 78: Opportunities exist in diversified end markets
Opportunities exist in Growth opportunities: diversified end markets Custom air handlers is core to our DNA and could be expanded into the BASX has experience in other markets commercial market beyond data center equipment R&D working on new products for multiple end markets Data centers Cleanroom e
Slide 79: "Productizing" for scale and diversification
“Productizing” for scale and diversification Air-side Actively reducing cost and standardizing select DC product offerings for the masses cooling Pursuing a new semi-custom AHU that bridges the gap between the standard market and BASX's fully custom offering Like AAON, the focus is on configurabilit
Slide 80: Key takeaways
Key takeaways Fully custom solutions - providing innovative solutions, not just products Premier customer service - setting the industry standard for customer experience …leading us to a Aggressively capturing market share – leveraging our ~40% unique offering to take share from a large, growing mar
Slide 81: Rebecca Thompson
Rebecca Thompson Chief Financial Officer & Treasurer 81
Slide 82: Key takeaways
Key takeaways Three-year organic sales CAGR of 12.5%-plus Driving gross margins to 32%-35% Operating leverage through disciplined SG&A Managing a balanced capital allocation after increased CapEx spend in 2024-25 82
Slide 83: Financial highlights
Financial highlights¹ $1,168.5 $1,200.6 27.3% 24.2% $888.8 18.6% 16.4% Net sales 13.5% $514.6 $534.5 ROIC ($M) (Non-GAAP) 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 34.1% 33.1% 24.8% 30.3% 23.5% 22.7% 25.8% 26.7% 18.6% 18.3% Gross EBITDA margin margin (Non-GAAP) 2020 2021 2022 2023 2024 2020
Slide 84: 2025 outlook
2025 outlook Sales Sales growth in the mid-to high-teens Gross margin at similar levels we realized in 2024 Expenses SG&A as a percent of sales to decline 25 to 50 basis points CapEx Approximately $220.0 million 84
Slide 85: Affirming our 3-year targets
Organic sales CAGR Affirming 12.5%-plus SG&A as a Gross margin our 3-year 32%-35% percent of sales 13%-14% targets mid-single ~40% digits Note: The three-year organic sales CAGR is assuming a base year of 2024. 85
Slide 86: Where we are in the business cycle
Where we are in the business cycle +9.6% +3.1% +46.7% +31.5% +2.7% 2020 2021 2022 2023 2024 AAON branded sales up compounded AAON branded AAON branded sales volumes up sales volume 38% excluding pricing; BASX branded compounded 13% down 6%; BASX sales up compounded 107%1 branded data center sales up
Slide 87: Strong growth track record
Strong growth track record Sales growth: AAON vs peer group 5-year organic sales CAGR 50% 40% Peers 30% 20.7% 6.0% 20% 10% 0% -10% 2020 2021 2022 2023 2024 AAON Peer average Note: Peer average is composed of Lennox, Trane, Carrier and Johnson Controls. 87
Slide 88: Steady market share gains at AAON brand, close to 50% CAGR at BASX
Steady market share gains at AAON brand, close to 50% CAGR at BASX Taking share in a growing market¹ BASX-branded sales ($M)² 5% 7% Volume Volume 2019-24 CAGR Share Share 47% 225.0 33 0,000 7.7% 7.8% 8.0% 166.5 310,000 6.8% 7.0% 29 0,000 27 0,000 6.7% 117.7 6.0% 6.0% 80.7 25 0,000 5.1% 23 0,000 5.0%
Slide 89: Drivers to 12.5%+ sales growth
Drivers to 12.5%+ sales growth AAON and BASX growth drivers Share gains Pricing Market volume AAON growth DC air-side DC liquid Other growth BASX growth Total company cooling cooling Market volumes will be flattish in Data center air-side cooling and liquid 2025-2027, continuing to take share coolin
Slide 90: Both brands contributing to our strong backlog
Both brands contributing to our strong backlog Backlog remains strong despite changes in the cycle Backlog ($M) 867.1 599.9 558.4 650.0 647.7 Ended 1Q25 514.7 548.0 526.2 461.4 464.0 490.6 510.0 at record $1,026.9M 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25 AAON BASX 90
Slide 91: Margin expansion opportunity
Margin expansion opportunity Drivers of gross margin Gross margin Leveraging Target 32-35% sales growth gross margin Gross margin in 34.1% line with 2024 33.1% Operational productivity gains 30.3% Increased mix of high-volume orders 26.7% 25.8% Product-based 2020 2021 2022 2023 2024 2025E Long organ
Slide 92: Clear capital allocation priorities
Clear capital allocation priorities Internal Stockholder investment/ M&A returns CapEx 92
Slide 93: Focus on investing for growth
Focus on investing for growth Detail on Memphis expansion: • Building acquired Historical and future CapEx¹ Dec. 2024 • Equipment assembly began early 2025 250 • Installation of vertically integrated production in 200 Q2-Q3 2025 • Full production Normalized accelerates starting in 150 Level Q4 2025
Slide 94: Compelling ROIC
Compelling ROIC Consistent stewardship of capital through economic cycles ROIC¹ 27.3% 24.2% 20.3% 18.6% >20.0% 17.8% 16.4% 13.5% 2018 2019 2020 2021 2022 2023 2024 Long-term Acquired Memphis Addition ¹ See Non-GAAP Financial Measures in Appendix. 94
Slide 95: Consistent annual dividend increases and measured stock buybacks
Consistent annual dividend increases and measured stock buybacks Dividends: expect consistent annual increases $0.40 Opportunistic $0.32 buybacks: $0.29 $0.25 $0.21 $0.25 $0.32 $70M $0.16 remaining on the $0.21 $0.17 authorization 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 95
Slide 96: Measured approach to M&A
Measured approach to M&A Qualitative considerations include: Product or market diversification Custom or semi-custom solutions Strategic synergies associated Near-term, we do Given organic growth with product portfolio not anticipate any opportunities, we Vertical integration major M&A intend to be
Slide 97: Track record of low debt levels
Memphis capacity AAON has historically increases debt slightly, operated debt-free but will decrease soon Track record of low debt Leverage ratio 0.9x levels 0.6x 0.5x 0.4x 0.2x 2021 2022 2023 2024 1Q25 97
Slide 98: Key takeaways
Key takeaways Three-year organic sales CAGR 12.5%-plus Driving gross margins to 32%-35% Operating leverage through disciplined SG&A Managing a balanced capital allocation after increased CapEx spend in 2024-25 98
Slide 99: Driving value
Driving value 2027 Targets The AAON 12.5%+ 3-year organic sales CAGR investment thesis 32%-35% gross margin Premium offering Market leadership & differentiation & innovation Our rooftop business delivers Industry leader providing premium quality and a cutting-edge, customized compelling value propos
Slide 100: Q&A
Q&A 100
Slide 101: Appendix
Appendix 101
Slide 102: Non-GAAP Financial Measures
Non-GAAP Financial Measures 102
Slide 103: Non-GAAP Financial Measures
Non-GAAP Financial Measures 103
Slide 104: Non-GAAP Financial Measures
Non-GAAP Financial Measures 104