Truck Dealer Rush Enterprises Inc. Reports Third Quarter Results
SAN ANTONIO--Oct. 15, 2002--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 Sept. 30, 2002.In the third quarter, the Company's gross revenues totaled $242.9 million, a 24.5 percent increase from gross revenues of $195.2 million reported for the quarter ended Sept. 30, 2001. Net income for the quarter increased 171.6 percent to $2.9 million, or $0.20 per diluted share, compared with net income of $1.1 million, or $0.07 per diluted share reported in the quarter ended Sept. 30, 2001.
The Company's heavy-duty truck segment recorded revenues of $214.3 million in the third quarter of 2002, compared to $154.8 million in the third quarter of 2001. The Company delivered 1,587 and 537 new and used trucks, respectively, during the third quarter of 2002 compared to 966 and 479 new and used trucks, respectively, for the same period in 2001. Parts, service and body shop sales at our truck dealerships increased 12.1 percent from $48.3 million to $54.2 million from the third quarter of 2001 to the third quarter of 2002.
The Company's construction equipment segment recorded revenues of $18.0 million in the third quarter of 2002 compared to $28.4 million in the third quarter of 2001. New and used construction equipment unit sales revenue decreased $9.7 million or 47.1 percent from the same period in 2001. Parts and service sales decreased 6.3 percent from $6.3 million in the third quarter of 2001 to $5.9 million in the third quarter of 2002. Rental sales decreased from $1.1 million to $0.8 million, or 27.2 percent, from the third quarter of 2001 to the third quarter of 2002.
In announcing the results, W. Marvin Rush, Chairman and Chief Executive Officer of Rush Enterprises, said, "I am very pleased with our third quarter results. The increase in our earnings was primarily due to an increase in new truck sales, which was caused by the change in emission guidelines that took effect on Oct. 1, 2002. Due to the timing of new truck deliveries, I also expect new truck sales to be strong in the fourth quarter." Mr. Rush added, "Now our focus is on the first half of 2003. We expect new truck deliveries to decrease sharply due to the recent pre-buy and have implemented programs that have challenged our people to respond accordingly. I am confident in our people and look forward to the challenge."
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 - except for share information)
September 30, December 31,
2002 2001
(unaudited) (audited)
--------- -------
ASSETS
------
CURRENT ASSETS:
Cash and cash equivalents $ 20,197 $ 19,852
Accounts receivable, net 30,196 26,403
Inventories 147,602 114,305
Prepaid expenses and other 1,053 1,244
Deferred income taxes 1,186 1,508
--------- ---------
Total current assets 200,234 163,312
PROPERTY AND EQUIPMENT, net 129,535 132,196
OTHER ASSETS, net 41,662 42,703
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Total assets $ 371,431 $ 338,211
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LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Floor plan notes payable $ 112,076 $ 85,300
Current maturities of long-term debt 18,760 15,594
Advances outstanding under lines of credit 21,337 22,459
Trade accounts payable 14,041 15,284
Accrued expenses 28,788 23,047
--------- ---------
Total current liabilities 195,002 161,684
LONG-TERM DEBT, net of current maturities 76,149 82,576
DEFERRED INCOME TAXES, net 13,522 12,512
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, par value $.01 per share;
1,000 shares authorized; 0 shares
outstanding in 2002 and 2001 -- --
Common stock, par value $.01 per share;
50,000,000 shares authorized;
14,004,088 shares outstanding -
2002 and 2001 140 140
Additional paid-in capital 39,155 39,155
Retained earnings 47,463 42,144
--------- ---------
Total shareholders' equity 86,758 81,439
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Total liabilities and
shareholders' equity $ 371,431 $ 338,211
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RUSH ENTERPRISES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except earnings per share - unaudited)
Three months ended Nine months ended
September 30, September 30,
-------------------- --------------------
2002 2001 2002 2001
-------- -------- -------- --------
REVENUES:
New and used truck
sales $156,224 $102,646 $357,553 $339,415
Parts and service 58,071 52,381 170,101 149,571
Construction equipment
sales 10,906 20,626 35,046 52,556
Lease and rental 6,817 7,050 19,861 20,729
Finance and insurance 1,736 1,509 4,200 4,294
Retail sales 8,756 9,967 28,490 29,605
Other 420 988 1,602 2,778
-------- -------- -------- --------
TOTAL REVENUES 242,930 195,167 616,853 598,948
COST OF PRODUCTS SOLD 200,039 156,739 498,182 486,107
-------- -------- -------- --------
GROSS PROFIT 42,891 38,428 118,671 112,841
SELLING, GENERAL AND
ADMINISTRATIVE 33,601 31,420 96,239 91,758
DEPRECIATION AND
AMORTIZATION 2,482 2,664 7,449 7,979
-------- -------- -------- --------
OPERATING INCOME 6,808 4,344 14,983 13,104
INTEREST
INCOME (EXPENSE) (2,075) (2,585) (6,161) (9,505)
GAIN ON SALE OF ASSETS 93 18 43 871
-------- -------- -------- --------
INCOME BEFORE INCOME
TAXES 4,826 1,777 8,865 4,470
PROVISION FOR INCOME
TAXES 1,931 711 3,546 1,788
-------- -------- -------- --------
NET INCOME $ 2,895 $ 1,066 $ 5,319 $ 2,682
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EARNINGS PER SHARE:
Basic $ 0.21 $ 0.08 $ 0.38 $ 0.19
Diluted $ 0.20 $ 0.07 $ 0.37 $ 0.19
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Weighted average
shares outstanding
Basic 14,004 14,004 14,004 14,004
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Diluted 14,536 14,284 14,504 14,138
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