Paccar reported improved revenues and net income for the second quarter of 2011, but fell short of Wall Street's forecasted earnings.


Paccar's results reflect the benefits of stronger truck sales in North America and Europe and an improvement in aftermarket parts sales and financial services worldwide.

However, the company missed Wall Street's profit forecast, sending its shares down 10%, its biggest drop since late 2008. Paccar also lowered its forecast for overall demand this year, citing the uncertain economy.

Paccar earned $239.7 million, 65 cents per diluted share, for the second quarter of 2011 compared to $99.6 million, 27 cents per diluted share, earned in the second quarter last year. The company had expected earnings of 69 cents per share.

Second quarter net sales and financial services revenues were $3.96 billion, compared to $2.46 billion reported in 2010.

Net sales and financial services revenues for the first six months of 2011 were $7.24 billion, up 54% compared to $4.69 billion last year. For the first six months of 2011, Paccar reported net income of $433.0 million ($1.18 per diluted share), more than double the $167.9 million ($0.46 per diluted share) in 2010.

Paccar announced on July 11, 2011, that it increased its regular quarterly dividend by 50 percent, to 18 cents per share up from 12 cents for shareholders of record on August 18, 2011. The increased dividend will be paid September 6, 2011.

Class 8 industry retail sales in the U.S. and Canada are expected to be in the range of 180,000-200,000 vehicles in 2011. Paccar lowered the range due to the uneven economic recovery and supplier capacity constraints, especially tires and chassis components. For the first half of 2011, Paccar achieved a Class 8 retail market share in the U.S. and Canada of 26.7%, an increase from the 24.1% achieved for the year 2010.

Looking forward, capital investments of $400-$500 million and R&D expenses of $275-$300 million are targeted in 2011 for new products and enhancing manufacturing operating efficiency.