Rush Enterprises Inc. Reports Second Quarter Results
SAN ANTONIO--July 17, 2001--Rush Enterprises Inc. , which operates the largest network of Peterbilt heavy-duty truck dealerships in North America, John Deere construction equipment dealerships in Texas and Michigan, and three of the largest farm and ranch superstores (D&D) in America, today announced results for the quarter ended June 30, 2001.In the second quarter, the Company's gross revenues totaled $199.3 million, a 19.8 percent decrease from gross revenues of $248.5 million reported for the second quarter ended June 30, 2000. Net income for the quarter decreased 15.7 percent to $1.5 million, or $0.21 per share, compared with net income of $1.7 million, or $0.25 per share reported in the quarter ended June 30, 2000.
These results include a $0.8 million pretax gain on the sale of real estate and $0.9 million of pretax loss provision recognized during the second quarter of 2001 to increase the Company's reserve for truck valuation and repossession losses. During the second quarter of 2000 the Company recognized $1.25 million in pretax truck valuation and repossession losses.
The Company's heavy-duty truck segment recorded revenues of $160.8 million in the second quarter of 2001, compared to $210.4 million in the second quarter of 2000. The Company delivered 998 and 524 new and used trucks, respectively, during the second quarter of 2001 compared to 1,653 and 558 new and used trucks, respectively, for the same period in 2000. Parts, service and body shop sales at our truck dealerships increased 10.0 percent from $42.1 million to $46.3 million from the second quarter of 2000 to the second quarter of 2001.
The Company's construction equipment segment recorded revenues of $26.2 million in the second quarter of 2001 compared to $28.7 million in the second quarter of 2000. The Company delivered 219 and 70 new and used construction equipment units, respectively, during the second quarter of 2001 compared to 282 and 83 new and used construction equipment units, respectively, for the same period in 2000. Parts and service sales increased 11.1 percent from $5.5 million in the second quarter of 2000 to $6.1 million in the second quarter of 2001. Rental sales decreased from $2.4 million to $1.6, or 33.3 percent, from the second quarter of 2000 to the second quarter of 2001.
In announcing the results, W. Marvin Rush, chairman and chief executive officer of Rush Enterprises, said, "We are very pleased with our second quarter financial results given the current state of the truck and construction equipment markets. I am proud of our people. They have reduced expenses, utilized assets efficiently and have become better managers in a tough business environment.
"We continue to experience growth in the back-ends of our business and truck sales to niche markets, such as the oil and gas, refuse and construction industries, remain strong. Although the market continues to be soft, we hope to see an increase in over-the-road truck sales during the second half of the year. We believe the Company is positioned to take advantage of any opportunities that may arise."
Rush Enterprises operates the largest network of Peterbilt heavy-duty truck dealerships in North America and John Deere construction equipment dealerships in Texas and Michigan. Its current operations include a network of dealerships located in Texas, California, Oklahoma, Louisiana, Colorado, Arizona, New Mexico and Michigan. These dealerships provide an integrated, one-stop source for the retail sale of new and used heavy-duty trucks and construction equipment; aftermarket parts, service and body shop facilities; and a wide array of financial services, including the financing of truck and equipment sales, insurance products and leasing and rentals. The Company also operates retail farm and ranch superstores that serve the greater San Antonio, Houston and Dallas/Forth Worth, Texas areas.
Certain statements contained herein, including those concerning industry conditions, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, competitive factors, general economic conditions, cyclicality, economic conditions in the new and used truck and construction equipment markets, customer relations, relationships with vendors, the interest rate environment, governmental regulation and supervision, seasonality, distribution networks, product introductions and acceptance, technological change, changes in industry practices, onetime events and other factors described herein and in filings made by the company with the Securities and Exchange Commission.
RUSH ENTERPRISES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands -- unaudited, except for share information)
June 30, December 31,
2001 2000
(Unaudited) (Audited)
ASSETS -------- --------
CURRENT ASSETS:
Cash and cash equivalents $ 22,662 $ 18,892
Accounts receivable, net 17,285 20,350
Inventories 134,529 177,415
Prepaid expenses and other 1,378 3,800
-------- --------
Total current assets 175,854 220,457
PROPERTY AND EQUIPMENT, net 128,902 130,532
OTHER ASSETS, net 37,277 37,885
-------- --------
Total assets $342,033 $388,874
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Floor plan notes payable $100,326 $146,272
Current maturities of long-term debt 9,111 11,379
Advances outstanding under lines of credit 35,774 33,779
Trade accounts payable 12,024 14,157
Accrued expenses 14,182 17,409
-------- --------
Total current liabilities 171,417 222,996
LONG-TERM DEBT, net of current maturities 82,177 79,607
DEFERRED INCOME TAXES, net 8,646 8,094
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, par value $.01 per share;
1,000 shares authorized; 0 shares
outstanding in 2001 and 2000 -- --
Common stock, par value $.01 per share;
25,000,000 shares authorized; 7,002,044
shares outstanding -- 2001 and 2000 70 70
Additional paid-in capital 39,155 39,155
Retained earnings 40,568 38,952
-------- --------
Total shareholders' equity 79,793 78,177
-------- --------
Total liabilities and shareholders' equity $342,033 $388,874
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RUSH ENTERPRISES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except earnings per share -- unaudited)
Three months ended Six months ended
June 30, June 30,
-------------------- --------------------
2001 2000 2001 2000
--------- --------- --------- ---------
REVENUES:
New and used
truck sales $ 110,728 $ 166,879 $ 236,769 $ 300,524
Parts and service 50,268 44,067 97,190 85,653
Construction
equipment sales 17,989 20,244 31,930 38,411
Lease and rental 7,423 7,457 13,679 14,351
Finance and insurance 1,668 1,830 2,785 5,225
Retail sales 10,241 7,167 19,638 12,047
Other 975 892 1,873 2,277
--------- --------- --------- ---------
TOTAL REVENUES 199,292 248,536 403,864 458,488
COST OF PRODUCTS SOLD 161,732 209,044 329,368 382,251
--------- --------- --------- ---------
GROSS PROFIT 37,560 39,492 74,496 76,237
SELLING, GENERAL
AND ADMINISTRATIVE 30,219 30,551 60,338 60,017
DEPRECIATION
AND AMORTIZATION 2,658 2,259 5,315 4,327
--------- --------- --------- ---------
OPERATING INCOME 4,683 6,682 8,843 11,893
INTEREST
INCOME (EXPENSE) (3,018) (3,793) (6,920) (7,211)
GAIN ON SALE OF ASSETS 770 -- 770 --
--------- --------- --------- ---------
INCOME BEFORE
INCOME TAXES 2,435 2,889 2,693 4,682
PROVISION FOR
INCOME TAXES 974 1,156 1,077 1,873
--------- --------- --------- ---------
NET INCOME $ 1,461 $ 1,733 $ 1,616 $ 2,809
========= ========= ========= =========
EARNINGS PER SHARE:
Basic $ 0.21 $ 0.25 $ 0.23 $ 0.40
Diluted $ 0.21 $ 0.25 $ 0.23 $ 0.40
========= ========= ========= =========
Weighted average
shares outstanding
Basic 7,002 7,002 7,002 7,002
========= ========= ========= =========
Diluted 7,038 7,013 7,025 7,041
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