Rush Enterprises Announces Fourth Quarter and Year End Results
2 March 1998
Rush Enterprises Announces Fourth Quarter and Year End Results and the Acquisition of D&D Farm and Ranch Supermarket, Inc.
SAN ANTONIO, March 2 -- Rush Enterprises, Inc.
, which operates the largest network of Peterbilt heavy-duty
truck dealerships in North America and a John Deere construction equipment
dealership in Houston, Texas, today announced the results of operations for
the fourth quarter and twelve months ended December 31, 1997.
In the fourth quarter ended December 31, 1997, the Company's net revenues
totaled $118.5 million, up 26.9% from the $93.4 million reported in the fourth
quarter of 1996. Net income in the fourth quarter increased $333,000 to
$1.9 million from the prior year's quarter of $1.6 million. Earnings per
share in the fourth quarter increased from $0.24 to $0.29, or 20.7%.
In the year ended December 31, 1997, the Company's net revenues totaled
$399.4 million, up 16.2% from the $343.7 million reported in the previous
year. Net income increased $112,000 to $5.4 million from the prior year pro
forma level of $5.3 million. Earnings per share decreased from a pro forma
level of $0.94 to an actual of $0.81, or 13.8%, on an 18.9% increase in the
average shares outstanding, resulting from the Company's initial public
offering. The 1996 results were reported as pro forma figures, computed as if
the Company's subchapter S earnings were subject to income taxes.
Additionally, Rush today announced through its Rush Retail Centers
division, that it has acquired the stock of D&D Farm and Ranch Supermarket,
Inc. ("D&D") for approximately $10,500,000, with the purchase price being paid
in a combination of cash and notes payable. D&D operates a retail farm and
ranch superstore, in the Greater San Antonio, Texas area (Seguin, Texas). D&D
generated revenues of approximately $17.0 million for the year ended April 30,
1997.
Rush will continue to operate D&D as a full-service retail center under
the Rush Retail Centers concept, which Rush believes will provide increased
opportunities for expansion into additional metropolitan markets. As
previously announced, to facilitate the planned expansion, Mr. Daryl Lansdale
will serve as President of the newly formed retail division.
W. Marvin Rush, Chairman and Chief Executive Officer of Rush Enterprises,
Inc. stated, "The results of the entire fiscal year reflect the difficulties
encountered during the first half of 1997. However, the results of the second
half of 1997 and particularly the fourth quarter generally reflect the
strength of our business. The fourth quarter earnings growth of 20.7% coupled
with strong revenue growth has positioned us for the upcoming year. We remain
optimistic as to our prospects during 1998."
Mr. Rush continued, "We remain committed to our strategy of industry
consolidation and believe offering high-quality service to our customers over
a wide geographic area will enable us to realize economies of scale and more
favorable purchasing power. In furtherance of this, our acquisition of D&D
creates an exciting new avenue of strategic diversification as well as an
opportunity to market additional products to our existing customers. By
following this strategy, we believe we are poised to become the dominant
player in the truck and equipment dealership industry, all while generating
increasing levels of revenues, earnings, and shareholder value."
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 and Colorado.
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 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, those discussed in filings made by the Company with the
Securities and Exchange Commission.
RUSH ENTERPRISES, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1995, 1996 AND 1997
(In Thousands, Except Per Share Amounts)
1995 1996 1997
REVENUES:
New and used truck sales $192,949 $258,613 $290,495
Parts and service 53,368 64,505 78,665
Construction equipment sales --- --- 7,518
Lease and rental 10,058 13,426 14,761
Finance and insurance 3,980 5,855 6,026
Other 1,279 1,262 1,904
Total revenues 261,634 343,661 399,369
COST OF PRODUCTS SOLD 219,059 289,143 334,583
GROSS PROFIT 42,575 54,518 64,786
SELLING, GENERAL AND
ADMINISTRATIVE 31,238 40,552 50,618
DEPRECIATION AND AMORTIZATION 1,846 2,416 2,977
OPERATING INCOME 9,491 11,550 11,191
INTEREST INCOME (EXPENSE):
Interest income --- 1,118 1,155
Interest expense 2,886 4,171 3,668
Total interest expense, net 2,886 3,053 2,513
MINORITY INTEREST 162 --- ---
INCOME FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 6,443 8,497 8,678
PROVISION FOR INCOME TAXES --- 2,295 3,298
INCOME FROM CONTINUING OPERATIONS 6,443 6,202 5,380
DISCONTINUED OPERATIONS:
Operating income (loss) (224) --- ---
Gain on disposal 1,785 --- ---
INCOME FROM DISCONTINUED
OPERATIONS 1,561 --- ---
NET INCOME $8,004 $6,202 $5,380
BASIC AND DILUTED EARNINGS
PER SHARE
Net income loss before
discontinued operations $1.50 $1.11 $.81
Income from discontinued operations .36 --- ---
Net income per common share $1.86 $1.11 $.81
UNAUDITED PRO FORMA DATA:
Income from continuing operations
before income taxes $6,443 $8,497
Pro forma adjustments to
reflect federal and state
income taxes 2,448 3,229
Pro forma income from continuing
operations after provision for
income taxes $3,995 $5,268
Pro forma basic and dilutive
income from continuing
operations per share $ .93 $ .94
Weighted average shares outstanding
used in the pro forma income
from continuing operations per
share calculation 4,297 5,590
SOURCE Rush Enterprises, Inc.