Aftermarket

Paccar Reports Record Quarterly Revenue, Doubles Net Income

October 25, 2011

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Paccar reported the highest quarterly revenues in its history and doubled its net income in the third quarter of 2011.


"Increased truck deliveries, higher aftermarket sales and a growing financial services business worldwide contributed to increased profits," said Mark Pigott, chairman and chief executive officer.

"Our customers in North America are benefiting from increased freight tonnage and higher fleet utilization which are driving the replacement of their aging fleets, resulting in increased demand for Paccar products and services. European truck registrations have improved versus 2010, but recent Eurozone economic uncertainties have resulted in lower industry truck orders.

"I am very proud of our 23,000 employees who have delivered industry leading products and services to our customers worldwide."

Paccar's balance sheet included $2.73 billion in manufacturing cash and marketable securities, and its operating cash flow was more than $1.15 billion in 2011, he said. These have funded ongoing investments to extend the company's geographic presence, enhance operating efficiency and support the development of innovative new products.

"Suppliers' performance has improved significantly as they have invested in capacity and production efficiency to meet increased market demand," said Pigott.

"Class 8 industry retail sales in the U.S. and Canada are expected to be in the range of 185,000-200,000 vehicles in 2011. Our customers are benefiting from higher freight tonnage and improved freight rates," said Dan Sobic, Paccar executive vice president.

Kenworth and Peterbilt achieved a combined market share of 27.7%, a record for Paccar, he said. Estimates for industry Class 8 retail sales in 2012 are in the range of 205,000-230,000 units, driven primarily by ongoing replacement of the aging fleet.

DAF vehicles have achieved industry leadership in many countries in Europe, said Harrie Schippers, DAF president. DAF leads in European tractor sales with over 19% market share, and 15.2% in the above-15-tonne market for the first nine months of 2011.

"The estimate for 2011 industry sales in the above 15-tonne truck market in Europe is 235,000-245,000 units. It is anticipated that industry sales in 2012 will be in the range of 225,000-250,000 units," said Schippers.

Paccar earned $281.6 million ($.77 per diluted share) for the third quarter of 2011, a 135% increase, compared to the $119.9 million ($.33 per diluted share) earned in the third quarter last year.

Third quarter net sales and financial services revenues of $4.26 billion compare to $2.54 billion in 2010. Net sales and financial services revenues for the first nine months of 2011 were $11.50 billion compared to $7.24 billion in the prior year.

For the first nine months of 2011, Paccar reported net income of $714.6 million ($1.95 per diluted share), more than double the $287.8 million ($.79 per diluted share) earned in the first nine months of 2010.

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