) posted a 26.4% fall in earnings to 67 cents per share in the
first quarter of 2013 from 91 cents in the same quarter of 2012
and missed the Zacks Consensus Estimate by a penny. Net income
declined 27.9% to $236.1 million from $327.3 million in the first
quarter of 2012. Revenues in the quarter dipped 18.0% to $3.9
billion but surpassed the Zacks Consensus Estimate of $3.7
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The fall in revenues and earnings was attributable to lower
industry truck volumes in North America due to sluggish economic
Revenues in the Truck and Other segment dipped 19.6% to $3.6
billion during the quarter. Pre-tax income ebbed 37.2% to $250.6
million from $398.8 million in the year-ago quarter.
PACCAR launched the new DAF CF Euro 6 and LF Euro 6, the Kenworth
T880 and the Peterbilt Model 567 trucks in the quarter. These
lineups complemented the new DAF XF Euro 6, the Kenworth T680 and
the Peterbilt Model 579 trucks launched in 2012. PACCAR also
expanded its range of advanced, fuel-efficient engines with the
launch of the PACCAR MX-11 engine.
The company expects 2013 industry sales in the above 16-tons
between 210,000 units and 235,000 units compared with the prior
guidance of 210,000 units-250,000 units. However, it reiterated
Class 8 industry retail sales guidance of 210,000
vehicles-240,000 vehicles for 2013.
PACCAR continues to expand its global network of 15 strategically
located parts distribution centers (PDCs). The company already
opened a $30 million, 280,000-square-foot PDC in Eindhoven, the
Netherlands in March. Its PDC in Lancaster, PA, doubled in size
with the addition of 60,000 square feet. It will open its new
Brasilian PDC in Ponta Grossa in 2013, supporting the launch of
Revenues in the Financial Services segment (comprises portfolio
of 153,000 trucks and trailers, with total assets of $10.7
billion) increased 12.1% to $293.1 million while pretax income
rose 12.3% to $80.1 million in the first quarter of 2013. The
increase in pre-tax income was attributable to growth in
portfolio balances and lower borrowing costs.
PACCAR's cash and marketable debt securities amounted to $2.4
billion as of Mar 31, 2013, which was flat compared with the same
as of Dec 31, 2012. Long-term debt remained unchanged at $150
million as of Mar 31, 2013 compared with 2012-end.
The company's cash from operations increased significantly to
$384.0 million in the quarter from $126.3 billion in the same
quarter of 2012 due to a substantial fall in wholesale
receivables on new trucks. Meanwhile, capital expenditures
increased to $97.1 million from $70.7 million in the first
quarter of 2012. The company has targeted capital investments of
$400-$500 million and R&D expenses of $250-$275 million in
2013 for new products and expansion of manufacturing capacity.
PACCAR, a Zacks Rank #3 (Hold), is the third largest manufacturer
of heavy-duty trucks (with a capacity of more than 15 metric
tons) in the world after
), and has substantial manufacturing exposure to light/medium
trucks (with a capacity of 6-15 metric tons). The company also
provides customer support for its products with the supply of
aftermarket parts, finance and leasing services.
) with Zacks Rank #2 (Buy) is performing well in the industry
where PACCAR operates.