Rush Enterprises Inc. Reports First Quarter Results
21 April 2000
Rush Enterprises Inc. Reports First Quarter Results and the Grand Opening of a New Dealership in Laredo, Texas
SAN ANTONIO--April 19, 2000--Rush Enterprises Inc. (Nasdaq:RUSH), which operates the largest network of Peterbilt heavy-duty truck dealerships in North America and John Deere construction equipment dealerships in Texas and Michigan, today announced results for the first quarter ended March 31, 2000, and the grand opening of its new Laredo, Texas, heavy-duty truck dealership.In the first quarter, the Company's gross revenues totaled $210.0 million, an 18.1 percent increase over gross revenues of $177.8 million reported for the first quarter ended March 31, 1999. Net income for the quarter decreased 66.7 percent to $1.1 million, or $0.15 per share, compared with net income of $3.3 million, or $0.50 per share reported in the quarter ended March 31, 1999. These results include $1.5 million of loss provision recognized during the first quarter of 2000 to increase the Company's reserve for used truck valuation and repossession losses.
The Company's heavy-duty truck segment recorded revenues of $177.2 million in the first quarter of 2000, compared to $154.3 million in the first quarter of 1999. The Company delivered 1,339 and 592 new and used trucks, respectively, during the first quarter of 2000 compared to 1,229 and 601 new and used trucks, respectively, for the same period in 1999. Parts, service and body shop sales increased 42.0 percent from $26.9 million to $38.2 million from the first quarter of 1999 to the first quarter of 2000. The acquisitions of the Arizona, New Mexico and southern California locations during the latter half of 1999 significantly impacted the increase in revenues.
The Company's construction equipment segment recorded revenues of $25.9 million in the first quarter of 2000, compared to $16.6 million in the first quarter of 1999. The Company delivered 123 and 77 new and used construction equipment units, respectively, during the first quarter of 2000 compared to 105 and 38 new and used construction equipment units, respectively, for the same period in 1999. Parts and service sales increased 41.0 percent from $3.9 million to $5.5 million from the first quarter of 1999 to the first quarter of 2000. Rental sales increased from $1.0 million to $1.7 million, or 70.0 percent, from the first quarter of 1999 to the first quarter of 2000. The September 1999 acquisition of the eastern Michigan locations impacted the increase in revenues.
Furthermore, Rush announced the grand opening of its new Laredo, Texas, location. This new dealership is strategically located along the proposed NAFTA highway and significantly expands the Company's presence in this rapidly growing market. Rush first opened in Laredo, Texas, in 1991. Since that time, truck traffic along the U.S./Mexico border has increased significantly, making this one of the Company's fastest-growing markets. This expansion, coupled with the recent acquisitions of the New Mexico, Arizona and San Diego locations, strategically positions the Company to take advantage of future U.S./Mexico border opportunities.
In announcing the results, W. Marvin Rush, Chairman and Chief Executive Officer of Rush Enterprises, said, "As indicated by our first quarter results, the truck market remains soft. We expect the remainder of the year to show improvements over the first quarter, however, we still believe that year 2000 new truck deliveries will be sharply below prior year levels. Although industry conditions have weakened 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 a retail farm and ranch superstore that serves the greater San Antonio, Texas area.
Certain statements contained herein, including those concerning the outlook for the remainder of the year, 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
(in thousands, except earnings per share - unaudited)
Three months ended
March 31,
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2000 1999
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REVENUES:
New and used truck sales $133,645 $121,684
Parts and service 41,586 30,141
Construction equipment sales 18,167 11,792
Lease and rental 6,894 5,058
Finance and insurance 3,395 3,628
Retail sales 4,880 4,612
Other 1,385 928
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TOTAL REVENUES 209,952 177,843
COST OF PRODUCTS SOLD 173,207 146,608
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GROSS PROFIT 36,745 31,235
SELLING, GENERAL AND ADMINISTRATIVE 29,466 22,889
DEPRECIATION AND AMORTIZATION 2,068 1,330
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OPERATING INCOME 5,211 7,016
INTEREST EXPENSE, NET 3,418 1,484
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INCOME BEFORE INCOME TAXES 1,793 5,532
PROVISION FOR INCOME TAXES 717 2,213
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NET INCOME $1,076 $3,319
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EARNINGS PER SHARE:
Basic $0.15 $0.50
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Diluted $0.15 $0.50
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Weighted average shares outstanding
Basic 7,002 6,646
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Diluted 7,036 6,706
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