This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk00: Good afternoon, ladies and gentlemen, and welcome to the Aon Inc. third quarter of 2024 earnings release conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, November 7, 2024. I would now like to turn the conference over to Joseph Mondello, Director of Investor Relations.
spk02: Thank you, operator, and good afternoon, everyone. The press release announcing our third quarter financial results was issued after market closed today and can be found on the corporate website, aaon.com. The call today is accompanied with a presentation that you can also find on our website, as well as on the listen-only webcast. Joining me on today's call is Gary Field, CEO, Matt Tobolsky, President and COO, and Rebecca Thompson, CFO and Treasurer. Please turn to slide two. We begin with our customary forward-looking statement policy. During the call, any statement presented dealing with information that is not historical is considered forward-looking and made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1955, the Securities Act of 1933, and the Securities and Exchange Act of 1934, each as amended. As such, it is subject to the occurrence of many events outside of ANS control that could cause ANS results to differ materially from those anticipated. You are all aware of the inherent difficulties, risks, and uncertainties in making predictive statements. Our press release and Form 10-Q that we filed this afternoon detail some of the important risk factors that may cause our actual results to differ from those in our predictions. Please note that we do not have the duty to update our forward-looking statements. Our press release and portions of today's call use non-GAAP financial measures as defined in Regulation G. You can find the related reconciliations to GAAP measures in our press release and presentation. With that, I will turn the call over to Gary.
spk01: Starting on slide three, the third quarter was another solid quarter for Aon. Total revenue grew year over year 4.9%, and diluted earnings per share was up 8.6%. both strong results for the quarter. Gross margin contracted 230 basis points versus the comparable quarter a year ago. We maintain that gross margin in the mid-30s is very healthy for this business. In fact, the gross margin this quarter represented one of the strongest quarters in the company's history. Likewise, adjusted EBITDA margin of 25.3% marked the third strongest quarter in company history. Overall, Our operations have been performing well, which is reflected in these results. From a demand perspective, bookings in the third quarter were up year-over-year in the mid-single digits. And year-to-date, they were up approximately 27%. Demand for data center equipment remained strong. Backlog at the Aon Coil product segment at the end of the quarter was a segment record up approximately 63% from a year ago. And backlog at the basic segment finished close to record levels, up over 100% from a year ago. Total backlog finished at 647.7 million, up 32% from a year ago, and was comparable with the total backlog at the end of the second quarter. A significant portion of the total backlog at the end of the quarter consisted of orders of data center equipment. Furthermore, subsequent to the end of the quarter, we received approximately $174.5 million of orders that by and large will be produced in the first half of 2025. We addressed this in a press release that we issued two weeks ago. These orders are associated with a liquid cooling solution for one data center customer and will be produced at our Longview, Texas location. In addition to these orders from this one customer, the pipeline of opportunity is very robust. While this was a big win for Aon, we foresee much more demand within the data center market going forward. Aon is becoming a leading player in the data center cooling market as a fully capable provider of highly engineered, energy efficient solutions for its customers. With that, I will now hand it over to Matt Tavolsky who will speak more in depth about our operational strategy. Matt Tavolsky Thank you, Jerry. Over the last several years, Aon has been undergoing a significant transformation. And as we've addressed in recent...
Disclaimer