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Rush Enterprises, Inc. Reports Second Quarter Results

SAN ANTONIO, July 26, 2011 (GLOBE NEWSWIRE) -- Rush Enterprises, Inc. (Nasdaq:RUSHA) (Nasdaq:RUSHB), which operates the largest network of commercial vehicle dealerships in North America, today announced results for the second quarter ended June 30, 2011.

In the second quarter, the Company's gross revenues totaled $662.0 million, a 100.7% increase from gross revenues of $329.8 million reported for the second quarter ended June 30, 2010. Income from continuing operations for the quarter was $12.5 million, or $0.32 per diluted share, compared with income from continuing operations of $5.4 million, or $0.14 per diluted share, in the quarter ended June 30, 2010. The Company reported net income for the quarter of $12.5 million, or $0.32 per diluted share, compared with a net income of $5.7 million, or $0.15 per diluted share, in the second quarter of 2010. 

The Company delivered 2,363 new heavy-duty trucks, 1,514 new medium-duty commercial vehicles, 314 light-duty commercial vehicles and 1,156 used commercial vehicles during the second quarter of 2011, compared to 813 new heavy-duty trucks, 795 new medium-duty trucks, 37 light-duty commercial vehicles and 889 used trucks during the second quarter of 2010. Parts, service and body shop sales revenue was $170.4 million in the second quarter of 2011, compared to $118.5 million in the second quarter of 2010.

"We are pleased with our performance this quarter and are extremely encouraged to have quarterly earnings back at levels that we last achieved in 2007," said W. M. "Rusty" Rush, President and Chief Executive Officer for Rush Enterprises, Inc.

"Record highs in parts, service and body shop revenues that were achieved in March continued throughout the second quarter," Rusty Rush said. "Our Rush Truck Centers set a new Company milestone for performance in June, eclipsing $1 million per day in gross profit from our parts, service and body shop operations. This led to another record quarterly absorption rate of 112.9%. This increased activity is attributable to the age of commercial vehicles in operation, combined with unprecedented activity in the energy sector, particularly in the central U.S. We expect parts, service and body shop revenues will continue at current levels through the third quarter," explained Rusty Rush.

"The second quarter marked our first meaningful increase in Class 8 and medium-duty truck sales since Class 8 industry orders began increasing in November 2010. Strong Class 8 truck sales activity continues to occur within the energy sector and we are also delivering new trucks to large Class 8 on-highway fleets that are replacing aged vehicles.  As industry freight rates have increased, we have seen an increase in sales activity to smaller over-the-road truck customers as well. Medium-duty truck sales activity increased significantly despite continued supply issues with Japanese manufacturers.  We delivered 398 buses in the quarter, a new Company record. As truck manufacturers continue to deal with component supplier delays, we expect both Class 8 and medium-duty truck sales activity for the third quarter to remain relatively flat compared with the second quarter," said Rusty Rush.

"While U.S. Class 8 truck orders have decreased since they peaked in April, we believe current order intake is adequate to support U.S. Class 8 retail sales of approximately 180,000 units in 2011. We continue to expect U.S. retail sales of Class 8 trucks to increase in 2012 and 2013. However, renewed economic concerns and the possibility of slower than expected recovery within automotive, manufacturing and construction sectors could result in a more controlled Class 8 truck growth cycle, possibly extending the cycle over a longer period of time with more gradual increases in truck sales," continued Rusty Rush.

"We continue to be very pleased with the progress being made in integrating our Navistar Division into the Company. Our Navistar Division, which had a positive impact on revenue growth and overall performance this quarter, now consists of 15 full-service dealerships with two dedicated collision centers. We remain committed to working with Navistar to build a successful network of dealerships and continue to explore opportunities for expansion."

"I am extremely proud of the entire Rush Enterprises organization," said W. Marvin Rush, Chairman and Founder of Rush Enterprises, Inc. "Through excellent leadership and continued dedication of employees across the country, the Company managed to withstand the most difficult downturn in its history and emerge from it well positioned to operate in the market up cycle while achieving its strategic growth initiatives.  We remain optimistic about our future prospects for growth and our ability to perform in the expected industry upturn."

Conference Call Information

Rush Enterprises will host its quarterly conference call to discuss earnings for the second quarter on Wednesday, July 27, 2011, at 11 a.m. Eastern/10 a.m. Central.  The call can be heard live by dialing 877-638-4557 (US) or 914-495-8522 (International) or via the Internet at

http://investor.rushenterprises.com/events.cfm

For those who cannot listen to the live broadcast, the webcast will be available on our website at the above link until October 15, 2011. Listen to the audio replay until August 3, 2011, by dialing 800-642-1687 (US) or 706-645-9291 (International) and entering the Conference ID 81631892.

About Rush Enterprises, Inc.

Rush Enterprises, Inc. owns and operates the largest network of commercial vehicle dealerships in the United States, representing truck and bus manufacturers including, Peterbilt, International, Hino, Isuzu, Ford, UD, Blue Bird, IC, Diamond and Elkhart. The Company's vehicle centers are strategically located in high traffic areas on or near major highways in 14 states throughout the Southern and Western United States. These one-stop centers offer an integrated approach to meeting customer needs -- from sales of new and used vehicles to aftermarket parts, service and body shop operations plus a wide array of financial services, including financing, insurance, leasing and rental. Rush Enterprises' operations also provide vehicle up-fitting, chrome accessories and tires. For more information, please visit www.rushenterprises.com.

The Rush Enterprises, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3352

Absorption rate is calculated by dividing the gross profit from the parts, service and body shop departments by the overhead expenses of all of a dealership's departments, except for the selling expenses of the new and used commercial vehicle departments and carrying costs of new and used commercial vehicle inventory. 

Certain statements contained herein, including those concerning current and projected truck industry and market conditions, sales forecasts, the Company's acquisition prospects, and the impact of general economic 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. Important 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 U.S. economic conditions, economic conditions in the new and used commercial vehicle markets, customer relations, relationships with vendors, the interest rate environment, governmental regulation and supervision, product introductions and acceptance, 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 Shares and Per Share Amounts)
     
  June 30, December 31,
  2011 2010
  (Unaudited)  
Assets    
Current assets:    
 Cash and cash equivalents $   146,285 $ 168,976
 Accounts receivable, net  70,743  43,513
 Inventories, net  451,887  321,933
 Prepaid expenses and other  7,350  14,104
 Deferred income taxes, net  11,025  10,281
     
 Total current assets 687,290  558,807
     
Investments 6,628 7,575
     
Property and equipment, net  475,385  445,919
     
Goodwill, net 176,329 150,388
     
Other assets, net  4,668  5,244
     
Total assets $    1,350,300 $ 1,167,933
     
     
Liabilities and shareholders' equity    
Current liabilities:    
 Floor plan notes payable $ 352,551 $  237,810
 Current maturities of long-term debt  57,933  62,279
 Current maturities of capital lease obligations  8,935  7,971
 Trade accounts payable  48,918  37,933
 Accrued expenses  78,042  69,036
 Total current liabilities  546,379  415,029
     
Long-term debt, net of current maturities  206,887  189,850
Capital lease obligations, net of current maturities 32,608 34,231
Other long-term liabilities 1,153 364
Deferred income taxes, net  72,452  63,540
     
Shareholders' equity:    
Preferred stock, par value $.01 per share; 1,000,000 shares authorized; 0 shares outstanding in 2011 and 2010  
 —  
 
 —  
Common stock, par value $.01 per share; 60,000,000 class A shares and 20,000,000 class B shares authorized; 27,155,861 class A shares and 10,725,472 class B shares outstanding in 2011; and 26,798,707 class A shares and 10,700,044 class B shares outstanding in 2010  
 
 
395
 
 
 
391
 Additional paid-in capital 202,940  195,747
 Treasury stock, at cost: 1,639,843 class B shares (17,948) (17,948)
 Retained earnings  306,736  286,951
 Accumulated other comprehensive loss, net of tax  (1,302)  (222)
     
 Total shareholders' equity  490,821  464,919
     
Total liabilities and shareholders' equity $  1,350,300  $ 1,167,933

 

RUSH ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
(Unaudited)
         
  Three Months Ended
June 30,
Six Months Ended
June 30,
   2011  2010   2011  2010
         
Revenues:        
 New and used truck sales $ 466,585 $ 191,309 $ 744,115 $ 371,913
 Parts and service 170,387 118,529 315,947 220,357
 Lease and rental 20,563 16,255 39,548 30,287
 Finance and insurance 2,744 2,047 4,712 3,532
 Other 1,703 1,699 3,764 3,038
         
 Total revenue 661,982 329,839 1,108,086 629,127
         
Cost of products sold:        
 New and used truck sales 436,163 174,817 695,068 341,163
 Parts and service 103,453 72,222 192,165 134,851
 Lease and rental 16,856 13,621 32,953 25,871
         
 Total cost of products sold 556,472 260,660 920,186 501,885
         
Gross profit 105,510 69,179 187,900 127,242
         
Selling, general and administrative 79,655 55,148 145,001 105,285
         
Depreciation and amortization 4,541 3,676 8,721 7,223
         
Gain (loss) on sale of assets 475 7 432 (4)
         
Operating income 21,789 10,362 34,610 14,730
         
Interest expense, net 1,599 1,397 2,800 2,694
         
Income from continuing operations before taxes 20,190 8,965 31,810 12,036
         
Provision for income taxes 7,672 3,549 12,025 4,698
         
Income from continuing operations  12,518  5,416  19,785  7,338
         
Income from discontinued operations, net —   272 —   587
         
Net income $ 12,518 $ 5,688 $ 19,785 $ 7,925
         
Earnings per common share - Basic:        
 Income from continuing operations $  .33 $  .15 $  .52 $  .20
 Net income  $  .33 $  .15 $  .52 $  .21
         
Earnings per common share - Diluted:        
 Income from continuing operations $    .32 $    .14 $  .51 $  .19
 Net income  $   .32  $     .15  $  .51 $  .21
         
Weighted average shares outstanding:        
 Basic 37,831 37,292 37,727 37,232
 Diluted 39,015 38,189 38,929 38,014
CONTACT: Rush Enterprises, Inc., San Antonio

         Steven L. Keller, 830-626-5226

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Source: Rush Enterprises, Inc.

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