Rush Enterprises Inc. Reports Third Quarter Results
SAN ANTONIO--Oct. 2, 20031, 2003--Rush Enterprises Inc. today announced results for the quarter ended September 30, 2003. Rush Enterprises' continuing operations include the largest network of Peterbilt heavy-duty truck dealerships in North America and a construction equipment dealership in Houston.In the third quarter 2003, the Company's gross revenues totaled $222.8 million, as compared with gross revenues of $224.9 million reported for the third quarter ended September 30, 2002. Sales of new trucks were down this quarter compared to the third quarter of 2002 due to a wave of pre-buys in 2002 that were prompted by new emissions laws that went into effect on October 1, 2002. Income from continuing operations was $3.2 million, or $0.21 per diluted share, during the third quarter of 2003 compared to $3.3 million, or $0.23 per diluted share in the third quarter of 2002. Net income for the quarter was $ 3.2 million, or $ 0.21 per diluted share, compared with net income of $2.9 million, or $0.20 per diluted share, reported in the quarter ended September 30, 2002. The Company recorded a net loss from discontinued operations of $ 36,000 in the third quarter of 2003. This loss consists primarily of real estate carrying costs related to the Company's retail center in Hockley, Texas, offset by operating profits in the Company's retail center in Seguin, Texas.
The Company's heavy-duty truck segment recorded revenues of $211.2 million in the third quarter of 2003, compared to $214.2 million in the third quarter of 2002. The Company delivered 1,307 new trucks and 684 used trucks during the third quarter of 2003 compared to 1,587 new trucks and 537 used trucks for the same period in 2002. Parts, service and body shop sales increased 22.5 percent from $51.0 million in the third quarter of 2002 to $62.5 million in the third quarter of 2003.
The Company's construction equipment segment recorded revenues of $9.5 million in the third quarter of 2003 compared to $8.4 million in the third quarter of 2002. New and used construction equipment unit sales revenue increased $1.0 million, or 19.6 percent, from the third quarter of 2002 to the third quarter of 2003. Parts and service sales increased 14.3 percent from $2.8 million in the third quarter of 2002 to $3.2 million in the third quarter of 2003. Lease and rental sales decreased $121,000, or 50.8 percent, from the third quarter of 2002 to the third quarter of 2003.
In announcing the results, W. Marvin Rush, chairman and chief executive officer of Rush Enterprises, said, " While truck sales declined from the third quarter of last year, our sales were up 32% compared to the second quarter of this year, furthermore, we are optimistic about the future, due to the unmistakable upturn in the overall economy. Historically, an accelerating economy has created increased demand for heavy-duty trucks and we believe that this cycle will be no different.
"We are well positioned to benefit from this upturn, due to the fact that we have increased our dealership locations from 22 to 39, streamlined our expense structure and strengthened our back-end operations." Mr. Rush added that "the Company continues to explore opportunities to open additional dealerships in new geographic markets."
Rush Enterprises operates the largest network of Peterbilt heavy-duty truck dealerships in North America and a John Deere construction equipment dealership in Houston, Texas. Its current operations include a network of dealerships located in Texas, California, Oklahoma, Louisiana, Colorado, Arizona, New Mexico, Alabama and Florida. 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.
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
SEPTEMBER 30, 2003 AND DECEMBER 31, 2002
(In Thousands, Except Shares and Per Share Amounts)
September 30, December 31,
2003 2002
(unaudited)(audited)
--------------------
ASSETS
--------------------------------------------------
CURRENT ASSETS:
Cash and cash equivalents $ 22,225 $ 24,763
Accounts receivable, net 26,532 24,935
Inventories 134,938 115,333
Assets held for sale 9,346 16,962
Prepaid expenses and other 1,228 1,764
Deferred income taxes 3,292 4,375
-------- --------
Total current assets 197,561 188,132
PROPERTY AND EQUIPMENT, net 117,164 117,859
OTHER ASSETS, net 43,063 38,519
-------- --------
Total assets $357,788 $344,510
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LIABILITIES AND SHAREHOLDERS' EQUITY
--------------------------------------------------
CURRENT LIABILITIES:
Floor plan notes payable $107,904 $ 89,288
Current maturities of long-term debt 22,738 24,958
Advances outstanding under lines of credit 17,413 22,395
Trade accounts payable 13,722 15,082
Accrued expenses 28,646 28,414
-------- --------
Total current liabilities 190,423 180,137
LONG-TERM DEBT, net of current maturities 67,147 69,958
DEFERRED INCOME TAXES, net 14,809 14,720
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, par value $.01 per share; 1,000
shares authorized; 0 shares outstanding in 2001
and 2002 - -
Common stock, par value $.01 per share;
50,000,000 shares authorized; 14,004,088 shares
outstanding in 2002 and 14,007,301 shares
outstanding in 2003 140 140
Additional paid-in capital 39,155 39,155
Retained earnings 46,114 40,400
-------- --------
Total shareholders' equity 85,409 79,695
-------- --------
Total liabilities and
shareholders' equity $357,788 $344,510
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RUSH ENTERPRISES, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Per Share Amounts)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
------------------- -------------------
2003 2002 2003 2002
-------- -------- -------- --------
REVENUES:
New and used truck sales $140,641 $156,224 $343,487 $357,553
Parts and service 67,053 54,930 186,135 160,519
Construction equipment
sales 6,102 5,080 20,278 17,521
Lease and rental 6,549 6,244 18,992 18,643
Finance and insurance 1,619 1,661 4,550 3,974
Other 831 714 2,228 1,637
-------- -------- -------- --------
Total revenues 222,795 224,853 575,670 559,847
COST OF PRODUCTS SOLD 181,373 185,795 461,655 453,640
-------- -------- -------- --------
GROSS PROFIT 41,422 39,058 114,015 106,207
SELLING, GENERAL AND
ADMINISTRATIVE 32,306 29,804 92,249 83,955
DEPRECIATION AND AMORTIZATION 2,263 2,158 6,705 6,467
-------- -------- -------- --------
OPERATING INCOME 6,853 7,096 15,061 15,785
INTEREST EXPENSE, NET 1,580 1,650 4,741 4,877
GAIN ON SALE OF ASSETS 43 99 342 111
-------- -------- -------- --------
INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES 5,316 5,545 10,662 11,019
PROVISION FOR INCOME TAXES 2,126 2,218 4,265 4,408
-------- -------- -------- --------
INCOME FROM CONTINUING
OPERATIONS 3,190 3,327 6,397 6,611
(LOSS) FROM DISCONTINUED
OPERATIONS, NET (36) (431) (683) (1,292)
-------- -------- -------- --------
NET INCOME $ 3,154 $ 2,896 $ 5,714 $ 5,319
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EARNINGS (LOSS) PER COMMON
SHARE-BASIC
Income from continuing
operations $ .23 $ .24 $ .46 $ .47
======== ======== ======== ========
Net income (loss) $ .23 $ .21 $ .41 $ .38
======== ======== ======== ========
EARNINGS (LOSS) PER COMMON
SHARE-DILUTED
Income from continuing
operations $ .21 $ .23 $ .43 $ .46
======== ======== ======== ========
Net income (loss) $ .21 $ .20 $ .39 $ .37
======== ======== ======== ========
Weighted average shares
outstanding:
Basic 14,007 14,004 14,007 14,004
======== ======== ======== ========
Diluted 15,079 14,536 14,720 14,504
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