Rush Enterprises, Inc. Reports Second Quarter 2024 Results, Announces $0.18 per Share Dividend
Rush Enterprises (NASDAQ: RUSHA & RUSHB) reported Q2 2024 results with revenues of $2.027 billion and net income of $78.7 million, or $0.97 per diluted share. This compares to revenues of $2.003 billion and net income of $98.3 million, or $1.17 per diluted share, in Q2 2023. The company faced challenging market conditions, including weak demand for Class 8 trucks and aftermarket parts due to the ongoing freight recession and high interest rates. Despite this, Rush Enterprises maintained strong performance in certain sectors, such as public and vocational segments. The company's Board declared a cash dividend of $0.18 per share, a 5.9% increase over the prior quarter. Rush Enterprises sold 4,128 new Class 8 trucks and 3,691 Class 4-7 medium-duty vehicles in Q2 2024. The company achieved an absorption ratio of 134.0% and expects market conditions to remain challenging in the near term.
Rush Enterprises (NASDAQ: RUSHA & RUSHB) ha riportato i risultati del secondo trimestre 2024, con ricavi di 2,027 miliardi di dollari e un utile netto di 78,7 milioni di dollari, pari a 0,97 dollari per azione diluita. Questo confronta con ricavi di 2,003 miliardi di dollari e un utile netto di 98,3 milioni di dollari, ovvero 1,17 dollari per azione diluita, nel secondo trimestre 2023. L'azienda ha affrontato condizioni di mercato difficili, tra cui una domanda debole per i camion di Classe 8 e i pezzi di ricambio a causa della continua recessione nel trasporto merci e dei tassi d'interesse elevati. Nonostante ciò, Rush Enterprises ha mantenuto una forte performance in alcuni settori, come quello pubblico e quello professionale. Il consiglio di amministrazione dell'azienda ha dichiarato un dividendo in contante di 0,18 dollari per azione, un aumento del 5,9% rispetto al trimestre precedente. Rush Enterprises ha venduto 4.128 nuovi camion di Classe 8 e 3.691 veicoli di media capacità di Classe 4-7 nel secondo trimestre 2024. L'azienda ha raggiunto un rapporto di assorbimento del 134,0% e si aspetta che le condizioni di mercato rimangano difficili nel breve periodo.
Rush Enterprises (NASDAQ: RUSHA & RUSHB) informó los resultados del segundo trimestre de 2024, con ingresos de 2.027 millones de dólares y ingreso neto de 78,7 millones de dólares, o 0,97 dólares por acción diluida. Esto se compara con ingresos de 2.003 millones de dólares y un ingreso neto de 98,3 millones de dólares, o 1,17 dólares por acción diluida, en el segundo trimestre de 2023. La compañía enfrentó condiciones de mercado desafiantes, incluida la débil demanda de camiones de Clase 8 y piezas de repuesto debido a la recesión en el transporte y las altas tasas de interés. A pesar de esto, Rush Enterprises mantuvo un sólido desempeño en ciertos sectores, como los segmentos público y vocacional. La Junta declaró un dividendo en efectivo de 0,18 dólares por acción, un aumento del 5,9 % en comparación con el trimestre anterior. Rush Enterprises vendió 4.128 nuevos camiones de Clase 8 y 3.691 vehículos de clase media de Clase 4-7 en el segundo trimestre de 2024. La compañía logró un índice de absorción del 134,0% y espera que las condiciones del mercado permanezcan desafiantes en el corto plazo.
러시 엔터프라이즈(Rush Enterprises) (NASDAQ: RUSHA & RUSHB)는 2024년 2분기 결과를 보고하며 매출 20억 2700만 달러와 순이익 7870만 달러를 기록했으며, 희석 주당 0.97달러에 해당합니다. 이는 2023년 2분기의 20억 30만 달러의 매출과 9830만 달러의 순이익, 즉 희석 주당 1.17달러와 비교됩니다. 이 회사는 계속되는 화물 경기 침체와 높은 금리에 따른 약한 클래스 8 트럭과 애프터마켓 부품에 대한 수요 감소로 어려운 시장 상황에 직면했습니다. 그럼에도 불구하고 러시 엔터프라이즈는 공공 및 직업 세그먼트와 같은 특정 분야에서 강력한 성과를 유지했습니다. 회사의 이사회는 주당 0.18달러의 현금 배당금을 선언했습니다, 이는 이전 분기 대비 5.9% 증가한 수치입니다. 러시 엔터프라이즈는 2024년 2분기에 4,128대의 새로운 클래스 8 트럭과 3,691대의 클래스 4-7 중형 차량을 판매했습니다. 회사는 134.0%의 흡수 비율을 달성했으며, 가까운 시일 내에 시장 여건이 여전히 어려울 것으로 예상하고 있습니다.
Rush Enterprises (NASDAQ: RUSHA & RUSHB) a annoncé les résultats du deuxième trimestre 2024, avec des revenus de 2,027 milliards de dollars et un bénéfice net de 78,7 millions de dollars, soit 0,97 dollar par action diluée. Cela se compare à des revenus de 2,003 milliards de dollars et un bénéfice net de 98,3 millions de dollars, soit 1,17 dollar par action diluée, au deuxième trimestre 2023. L'entreprise a dû faire face à des conditions de marché difficiles, y compris une demande faible pour les camions de Classe 8 et les pièces de rechange en raison de la récession en cours dans le secteur du fret et des taux d'intérêt élevés. Malgré cela, Rush Enterprises a maintenu une performance solide dans certains secteurs, tels que les segments public et professionnel. Le conseil d'administration de l'entreprise a déclaré un dividende en espèces de 0,18 dollar par action, soit une augmentation de 5,9 % par rapport au trimestre précédent. Rush Enterprises a vendu 4 128 nouveaux camions de Classe 8 et 3 691 véhicules de classe moyenne de Classe 4-7 lors du deuxième trimestre 2024. L'entreprise a atteint un taux d'absorption de 134,0 % et s'attend à ce que les conditions de marché restent difficiles à court terme.
Rush Enterprises (NASDAQ: RUSHA & RUSHB) berichtete über die Ergebnisse des zweiten Quartals 2024, mit Umsätzen von 2,027 Milliarden Dollar und einem Nettoeinkommen von 78,7 Millionen Dollar, was 0,97 Dollar pro verwässerter Aktie entspricht. Dies im Vergleich zu Umsätzen von 2,003 Milliarden Dollar und einem Nettoeinkommen von 98,3 Millionen Dollar, oder 1,17 Dollar pro verwässerter Aktie im zweiten Quartal 2023. Das Unternehmen sah sich herausfordernden Marktbedingungen gegenüber, einschließlich schwacher Nachfrage nach Klasse 8-Trucks und Ersatzteilen aufgrund der anhaltenden Fracht-Rezession und hohen Zinssätze. Trotz dieser Umstände konnte Rush Enterprises in bestimmten Sektoren, wie dem öffentlichen und dem beruflichen Segment, eine starke Leistung aufrechterhalten. Der Vorstand des Unternehmens beschloss eine Bardividende von 0,18 Dollar pro Aktie, was eine Erhöhung um 5,9 % im Vergleich zum vorherigen Quartal darstellt. Rush Enterprises verkaufte im zweiten Quartal 2024 4.128 neue Klasse 8-Trucks und 3.691 mittelgroße Fahrzeuge der Klassen 4-7. Das Unternehmen erzielte einen Absorptionsgrad von 134,0% und erwartet, dass die Marktbedingungen kurzfristig herausfordernd bleiben.
- Revenues increased 1.2% year-over-year to $2.027 billion
- Board declared a cash dividend of $0.18 per share, a 5.9% increase over the prior quarter
- Class 4-7 medium-duty commercial vehicle sales increased 6.2% compared to Q2 2023
- Strong performance in public sector and vocational segments
- Absorption ratio of 134.0% achieved in Q2 2024
- Net income decreased to $78.7 million from $98.3 million in Q2 2023
- Earnings per diluted share decreased to $0.97 from $1.17 in Q2 2023
- Aftermarket products and services revenues down 3.6% year-over-year
- New Class 8 truck sales decreased 4.0% compared to Q2 2023
- Used commercial vehicle sales decreased 7.8% compared to Q2 2023
Insights
Rush Enterprises' Q2 2024 results reveal a mixed performance amidst challenging market conditions. The company reported revenues of
Key financial highlights include:
- Aftermarket products and services revenues decreased by
3.6% to$627.4 million - Absorption ratio declined to
134.0% from139.7% in Q2 2023 - New Class 8 truck sales decreased by
4.0% , while Class 4-7 medium-duty vehicle sales increased by6.2% - Used commercial vehicle sales decreased by
7.8%
Despite the challenges, Rush Enterprises maintained a strong market position, accounting for
The increase in quarterly dividend to
Overall, while Rush Enterprises is navigating a difficult market cycle, its strategic initiatives and diverse revenue streams position it to weather the storm better than some competitors. Investors should monitor the company's ability to maintain market share and control costs in the face of continued industry headwinds.
Rush Enterprises' Q2 2024 results offer valuable insights into the current state of the commercial vehicle market. The company's performance reflects broader industry trends, particularly the ongoing freight recession and its impact on demand for trucks and aftermarket services.
Key market observations:
- New U.S. Class 8 retail truck sales declined by
18.6% year-over-year in Q2 2024 - ACT Research forecasts a
15.8% decrease in U.S. retail sales of new Class 8 trucks for 2024 - Class 4-7 commercial vehicle market showed more resilience, with only a
3.0% decline in Q2 2024 - ACT Research projects a
3.7% increase in U.S. retail sales for new Class 4-7 commercial vehicles in 2024
The divergence between Class 8 and Class 4-7 market performance suggests a shift in demand dynamics. While over-the-road carriers are struggling with low freight rates, vocational and public sector segments are showing strength. This trend may continue to shape the market in the near term.
The absence of significant pre-buy activity related to 2027 emissions regulations is noteworthy. Rush Enterprises doesn't expect this to begin until 2025, which could impact future sales cycles.
The used truck market remains challenging, with weak demand due to low freight rates, availability of new trucks and high interest rates. However, the rate of used truck depreciation appears to be slowing, which could stabilize this segment.
Looking ahead, the market faces several uncertainties, including the potential impact of the upcoming U.S. election on customer spending patterns. The industry may see increased pricing competition in the second half of the year, particularly in the Class 8 segment.
Overall, the commercial vehicle market is navigating a cyclical downturn, with recovery not expected until 2025. Companies with diverse customer bases and strong aftermarket operations are likely to be better positioned to manage through this challenging period.
- Revenues of
$2.0 billion , net income of$78.7 million - Earnings per diluted share of
$0.97 - Challenging market conditions impact aftermarket sales and overall financial performance
- Absorption ratio
134% - Board declares cash dividend of
$0.18 per share of Class A and Class B common stock, a5.9% increase over prior quarter
SAN ANTONIO, Texas, July 31, 2024 (GLOBE NEWSWIRE) -- Rush Enterprises, Inc. (NASDAQ: RUSHA & RUSHB), which operates the largest network of commercial vehicle dealerships in North America, today announced that for the quarter ended June 30, 2024, the Company achieved revenues of
“Despite persistent market challenges, including weak demand for Class 8 trucks and aftermarket parts and services due to the lingering freight recession and high interest rates, we are pleased with our financial performance in the second quarter,” said W.M. “Rusty” Rush, Chairman, Chief Executive Officer, and President of Rush Enterprises. “Although low freight rates continue to plague over-the-road carriers, our largest customer segment, we are experiencing continued strength in certain other key customer segments, including the public sector and vocational segments, which positively impacted our Class 8 truck sales revenues. Class 4-7 commercial vehicle sales remained steady, and we executed well on our used truck pricing and inventory strategies,” he continued. “However, along with the rest of the industry, we experienced a decrease in demand for aftermarket parts and services during the quarter, which negatively impacted our aftermarket results. Due to our diverse customer base and continued focus on our strategic initiatives, we believe we kept pace with the market from a parts sales perspective and outperformed the industry with respect to our service sales,” he added.
“Our Board of Directors approved a
“Looking ahead, we expect the freight recession to continue through the remainder of the year, although we are hopeful that freight rates may have bottomed out. However, we do not anticipate a meaningful recovery in freight rates until 2025 and we expect difficult operating conditions to continue for the near term. In the third quarter, we expect new Class 8 truck sales to soften compared to the second quarter, but we expect Class 4-7 commercial vehicle sales to remain steady, and we believe that our commercial vehicle sales will keep pace with, if not outperform, the market. I have confidence in our professional salesforce and believe we are well positioned to take advantage of all sales opportunities that we uncover,” Rush said. “Also, in anticipation of the softening market, in the second quarter we made some very responsible reductions to our operating expenses across the company to help mitigate the expected decrease in revenues. These expense reductions, combined with the strategic decisions we made several years ago to diversify our customer base and focus on supporting large national accounts, will help us manage this challenging market cycle,” he added.
“This is a cyclical industry that has experienced downturns many times before. However, that makes it no less challenging for our employees to navigate this difficult market. Expense reductions often mean our employees are asked to do more with fewer resources. So, I particularly want to acknowledge their efforts throughout the quarter and sincerely thank them for providing best-in-class service to our customers while staying focused on operating efficiently,” said Rush.
Operations
Aftermarket Products and Services
Aftermarket products and services accounted for approximately
“In the second quarter, our aftermarket results were down slightly year-over-year. As previously noted, the freight recession, as well as continued high interest rates are still negatively impacting over-the-road customers. That said, these difficult operating conditions are having an outsized effect on smaller operators, and we continue to see them exit the market. In the long term, that will play to the strengths of our organization and our strategic focus on supporting larger national accounts. Challenging economic conditions also led to decreased aftermarket demand from our wholesale, independent parts distributor and energy customers. On a brighter note, we experienced healthy year-over-year growth from our vocational, public sector and medium-duty customers,” he said.
“As we look toward the third quarter, we expect demand for aftermarket parts and services to remain steady, and we believe our third quarter results will be consistent with our second quarter performance. Although we do not expect market conditions to improve significantly in the third quarter, we are committed to leveraging the foundational tools and processes that we have put in place over the last few years through the execution of our strategic initiatives. We believe that these tools and processes will increase our efficiency and provide enhanced service to our customers, which I am confident will allow us to continue to outperform the industry,” Rush added.
Commercial Vehicle Sales
New U.S. Class 8 retail truck sales totaled 58,991 units in the second quarter of 2024, down
“After the production shortages of the last few years, which caused pent-up demand, new Class 8 truck demand has slowed significantly. Additionally, the sluggish industry conditions previously mentioned continue to negatively impact over-the-road customers. However, we did experience healthy sales growth in the second quarter, compared to the first quarter. This was primarily due to the timing of deliveries to some large customers and continued strong demand from vocational fleets. We expect vocational sales to remain strong in the third quarter,” Rush said.
“As we look toward the remainder of the year, we expect the current freight recession to persist and Class 8 truck demand to soften further, resulting in a decrease in Class 8 trucks sales in the third quarter. We also expect truck pricing to become more competitive in the second half of the year. However, we believe that we are well prepared to perform in a more competitive environment and we anticipate our sales will be in line with the market. In addition, it is worth noting that we have not seen any significant pre-buy activity related to 2027 emissions regulations, and we do not expect that to begin until 2025,” he added.
New U.S. Class 4 through 7 retail commercial vehicle sales totaled 63,534 units in the second quarter of 2024, down
“Demand from medium-duty customers remained healthy in the second quarter. Class 4-7 commercial vehicle production continues to increase, and delivery lead times have improved. Our Class 4-7 commercial vehicle sales were broad-based, across industry segments, and we were pleased to outpace the market in the second quarter. However, we continue to monitor delays at body manufacturers that could impact deliveries to customers going forward,” Rush said.
“Looking forward, we recognize that we are in an election year, which is a time when many customers take a wait-and-see approach to capital expenditures. We are closely watching various economic factors that could impact consumer spending and lead to a decrease in Class 4-7 commercial vehicle demand. However, at this time, we anticipate that our third quarter Class 4-7 commercial vehicle sales will be consistent with our second quarter results,” he said.
The company sold 1,723 used commercial vehicles in the second quarter of 2024, a
Leasing and Rental
Rush Truck Leasing operates 56 PacLease and Idealease franchises across the United States and Canada, with more than 9,900 trucks in its lease and rental fleet and more than 2,200 trucks under contract maintenance agreements. Lease and rental revenue decreased
Financial Highlights
In the second quarter of 2024, the Company’s gross revenues totaled
Aftermarket products and services revenues were
During the second quarter of 2024, the Company repurchased
“Despite the ongoing economic challenges our industry experienced in the second quarter, we are proud of our overall performance and our ability to continue returning value to our shareholders through our eighth quarterly dividend increase. We remain committed to our long-term strategic initiatives and are confident that we will successfully navigate this difficult market cycle,” Rush said.
Conference Call Information
Rush Enterprises will host its quarterly conference call to discuss earnings for the first quarter of 2024 on Thursday, August 1, 2024, at 10:00 a.m. Eastern/9:00 a.m. Central. The call can be heard live via the Internet at http://investor.rushenterprises.com/events.cfm.
Participants may register for the call at: https://register.vevent.com/register/BIa133312289504836aed447e6b6519c9f
While not required, it is recommended that you join the event 10 minutes prior to the start.
For those who cannot listen to the live broadcast, the webcast replay will be available at http://investor.rushenterprises.com/events.cfm.
Rush Enterprises, Inc. is the premier solutions provider to the commercial vehicle industry. The Company owns and operates Rush Truck Centers, the largest network of commercial vehicle dealerships in North America, with more than 150 locations in 23 states and Ontario, Canada, including 125 franchised dealership locations. These vehicle centers, strategically located in high traffic areas on or near major highways throughout the United States and Ontario, Canada, represent truck and bus manufacturers, including Peterbilt, International, Hino, Isuzu, Ford, Dennis Eagle, IC Bus and Blue Bird. They offer an integrated approach to meeting customer needs – from sales of new and used vehicles to aftermarket parts, service and body shop operations plus financing, insurance, leasing and rental. Rush Enterprises' operations also provide CNG fuel systems (through its investment in Cummins Clean Fuel Technologies, Inc.), telematics products and other vehicle technologies, as well as vehicle up-fitting, chrome accessories and tires. For more information, please visit us at www.rushtruckcenters.com www.rushenterprises.com and www.rushtruckcentersracing.com, on Twitter @rushtruckcenter and Facebook.com/rushtruckcenters.
Certain statements contained in this release, including those concerning current and projected market conditions, sales forecasts, market share forecasts s and anticipated demand for the Company’s services, are “forward-looking” statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements only speak as of the date of this release and the Company assumes no obligation to update the information included in this release. 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, inflation and the interest rate environment, governmental regulation and supervision, product introductions and acceptance, changes in industry practices, one-time events and other factors described herein and in filings made by the Company with the Securities and Exchange Commission, including in our annual report on Form 10-K for the fiscal year ended December 31, 2023. In addition, the declaration and payment of cash dividends and authorization of future share repurchase programs remains at the sole discretion of the Company’s Board of Directors and the issuance of future dividends and authorization of future share repurchase programs will depend upon the Company’s financial results, cash requirements, future prospects, applicable law and other factors that may be deemed relevant by the Company’s Board of Directors. Although we believe that these forward-looking statements are based on reasonable assumptions, there are many factors that could affect our actual business and financial results and could cause actual results to differ materially from those in the forward-looking statements. All future written and oral forward-looking statements by us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. Except for our ongoing obligations to disclose material information as required by the federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward-looking statements to reflect events or circumstances in the future or to reflect the occurrence of unanticipated events.
-Tables and Additional Information to Follow-
RUSH ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Shares and Per Share Amounts)
| June 30, | December 31, | ||||||
| 2024 | 2023 | ||||||
| (unaudited) | |||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash, cash equivalents and restricted cash | $ | 167,266 | $ | 183,725 | |||
| Accounts receivable, net | 286,848 | 259,353 | |||||
| Note receivable, affiliate | 6,035 | ||||||
| Inventories, net | 1,894,214 | 1,801,447 | |||||
| Prepaid expenses and other | 23,338 | 15,779 | |||||
| Total current assets | 2,377,701 | 2,260,304 | |||||
| Property and equipment, net | 1,522,808 | 1,488,086 | |||||
| Operating lease right-of-use assets, net | 115,503 | 120,162 | |||||
| Goodwill, net | 419,303 | 420,708 | |||||
| Other assets, net | 71,211 | 74,981 | |||||
| Total assets | $ | 4,506,526 | $ | 4,364,241 | |||
| Liabilities and shareholders’ equity | |||||||
| Current liabilities: | |||||||
| Floor plan notes payable | $ | 1,226,651 | $ | 1,139,744 | |||
| Current maturities of finance lease obligations | 40,076 | 36,119 | |||||
| Current maturities of operating lease obligations | 16,084 | 17,438 | |||||
| Trade accounts payable | 166,630 | 162,134 | |||||
| Customer deposits | 95,835 | 145,326 | |||||
| Accrued expenses | 152,625 | 172,549 | |||||
| Total current liabilities | 1,697,901 | 1,673,310 | |||||
| Long-term debt, net of current maturities | 396,562 | 414,002 | |||||
| Finance lease obligations, net of current maturities | 97,134 | 97,617 | |||||
| Operating lease obligations, net of current maturities | 101,510 | 104,514 | |||||
| Other long-term liabilities | 29,586 | 24,811 | |||||
| Deferred income taxes, net | 160,899 | 159,571 | |||||
| Shareholders’ equity: | |||||||
| Preferred stock, par value $.01 per share; 1,000,000 shares authorized; 0 shares outstanding in 2024 and 2023 | – | – | |||||
| Common stock, par value $.01 per share; 105,000,000 Class A shares and 35,000,000 Class B shares authorized; 61,869,093 Class A shares and 16,700,392 Class B shares outstanding in 2024; and 61,461,281 Class A shares and 16,364,158 Class B shares outstanding in 2023 | 816 | 806 | |||||
| Additional paid-in capital | 563,604 | 542,046 | |||||
| Treasury stock, at cost: 1,298,522 Class A shares and 1,746,047 Class B shares in 2024; and 1,092,142 Class A shares and 1,731,157 Class B shares in 2023 | (129,415 | ) | (119,835 | ) | |||
| Retained earnings | 1,573,316 | 1,450,025 | |||||
| Accumulated other comprehensive income (loss) | (4,927 | ) | (2,163 | ) | |||
| Total Rush Enterprises, Inc. shareholders’ equity | 2,003,394 | 1,870,879 | |||||
| Noncontrolling interest | 19,540 | 19,537 | |||||
| Total shareholders’ equity | 2,022,934 | 1,890,416 | |||||
| Total liabilities and shareholders’ equity | $ | $ | 4,506,526 | $ | 4,364,241 | ||
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, | |||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Revenues | ||||||||||||
| New and used commercial vehicle sales | $ | 1,300,308 | $ | 1,250,794 | $ | 2,423,627 | $ | 2,412,519 | ||||
| Parts and service sales | 627,431 | 651,130 | 1,276,627 | 1,299,356 | ||||||||
| Lease and rental | 87,646 | 88,549 | 175,567 | 175,215 | ||||||||
| Finance and insurance | 5,937 | 6,189 | 11,331 | 12,760 | ||||||||
| Other | 5,706 | 6,390 | 11,875 | 14,969 | ||||||||
| Total revenue | 2,027,028 | 2,003,052 | 3,899,027 | 3,914,819 | ||||||||
| Cost of products sold | ||||||||||||
| New and used commercial vehicle sales | 1,179,819 | 1,124,339 | 2,185,919 | 2,174,704 | ||||||||
| Parts and service sales | 392,133 | 403,351 | 804,387 | 805,506 | ||||||||
| Lease and rental | 62,687 | 61,514 | 126,457 | 121,992 | ||||||||
| Total cost of products sold | 1,634,639 | 1,589,204 | 3,116,763 | 3,102,202 | ||||||||
| Gross profit | 392,389 | 413,848 | 782,264 | 812,617 | ||||||||
| Selling, general and administrative expense | 251,368 | 256,691 | 515,033 | 513,499 | ||||||||
| Depreciation and amortization expense | 16,492 | 14,545 | 32,242 | 28,859 | ||||||||
| Gain (loss) on sale of assets | (48 | ) | 247 | 102 | 376 | |||||||
| Operating income | 124,481 | 142,859 | 235,091 | 270,635 | ||||||||
| Other income (expense) | 44 | (96 | ) | 221 | 2,251 | |||||||
| Interest expense (income), net | 19,464 | 12,238 | 37,437 | 23,221 | ||||||||
| Income before taxes | 105,061 | 130,525 | 197,875 | 249,665 | ||||||||
| Provision for income taxes | 26,278 | 32,001 | 47,603 | 60,351 | ||||||||
| Net income | 78,783 | 98,524 | 150,272 | 189,314 | ||||||||
| Less: Net income attributable to noncontrolling Interests | 122 | 249 | 3 | 584 | ||||||||
| Net income attributable to Rush Enterprises, Inc. | $ | $ | 78,661 | $ | 98,275 | $ | $ | 150,269 | $ | 188,730 | ||
| Net income attributable to Rush Enterprises, Inc. per share of common stock: | ||||||||||||
| Basic | $ | 1.01 | $ | 1.20 | $ | 1.91 | $ | 2.31 | ||||
| Diluted | $ | 0.97 | $ | 1.17 | $ | 1.84 | $ | 2.23 | ||||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 78,270 | 81,690 | 78,706 | 81,926 | ||||||||
| Diluted | 80,778 | 84,156 | 81,467 | 84,501 | ||||||||
| Dividends declared per common share | $ | 0.17 | $ | 0.14 | $ | 0.34 | $ | 0.28 | ||||
This press release and the attached financial tables contain certain non-GAAP financial measures as defined under SEC rules, such as Adjusted Net Income, Adjusted Total Debt, Adjusted Net (cash) Debt, EBITDA, Adjusted EBITDA, Free Cash Flow, Adjusted Free Cash Flow and Adjusted Invested Capital, which exclude certain items disclosed in the attached financial tables. The Company provides reconciliations of these measures to the most directly comparable GAAP measures.
Management believes the presentation of these non-GAAP financial measures provides useful information about the results of operations of the Company for the current and past periods. Management believes that investors should have the same information available to them that management uses to assess the Company’s operating performance and capital structure. These non-GAAP financial measures should not be considered in isolation or as a substitute for the most comparable GAAP financial measures. Investors are cautioned that non-GAAP financial measures utilized by the Company may not be comparable to similarly titled non-GAAP financial measures used by other companies.
| Three Months Ended | ||||||
| Commercial Vehicle Sales Revenue (in thousands) | June 30, 2024 | June 30, 2023 | ||||
| New heavy-duty vehicles | $ | 789,189 | $ | 773,833 | ||
| New medium-duty vehicles (including bus sales revenue) | 388,817 | 332,770 | ||||
| New light-duty vehicles | 32,778 | 26,946 | ||||
| Used vehicles | 80,360 | 107,735 | ||||
| Other vehicles | 9,164 | 9,510 | ||||
| Absorption Ratio | 134.0 | % | 139.7 | % | ||
Absorption Ratio
Management uses several performance metrics to evaluate the performance of its commercial vehicle dealerships and considers Rush Truck Centers’ “absorption ratio” to be of critical importance. Absorption ratio is calculated by dividing the gross profit from the parts, service and collision center 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. When
| Debt Analysis (in thousands) | June 30, 2024 | June 30, 2023 | ||||
| Floor plan notes payable | $ | 1,226,651 | $ | 1,125,373 | ||
| Current maturities of finance lease obligations | 40,076 | 34,605 | ||||
| Long-term debt, net of current maturities | 396,562 | 245,277 | ||||
| Finance lease obligations, net of current maturities | 97,134 | 102,227 | ||||
| Total Debt (GAAP) | 1,760,423 | 1,507,482 | ||||
| Adjustments: | ||||||
| Debt related to lease & rental fleet | (529,736 | ) | (377,927 | ) | ||
| Floor plan notes payable | (1,226,651 | ) | (1,125,373 | ) | ||
| Adjusted Total Debt (Non-GAAP) | 4,036 | 4,182 | ||||
| Adjustment: | ||||||
| Cash and cash equivalents | (167,266 | ) | (191,897 | ) | ||
| Adjusted Net Debt (Cash) (Non-GAAP) | $ | (163,230 | ) | $ | (187,715 | ) |
Management uses “Adjusted Total Debt” to reflect the Company’s estimated financial obligations less debt related to lease and rental fleet (L&RFD) and floor plan notes payable (FPNP), and “Adjusted Net (Cash) Debt” to present the amount of Adjusted Total Debt net of cash and cash equivalents on the Company’s balance sheet. The FPNP is used to finance the Company’s new and used inventory, with its principal balance changing daily as vehicles are purchased and sold and the sale proceeds are used to repay the notes. Consequently, in managing the business, management views the FPNP as interest bearing accounts payable, representing the cost of acquiring the vehicle that is then repaid when the vehicle is sold, as the Company’s floor plan credit agreements require it to repay loans used to purchase vehicles when such vehicles are sold. The Company has the capacity to finance all of its lease and rental fleet under its lines of credit established for this purpose, but may choose to only partially finance the lease and rental fleet depending on business conditions and its management of cash and interest expense. The Company’s lease and rental fleet inventory are either: (i) leased to customers under long-term lease arrangements; or (ii) to a lesser extent, dedicated to the Company’s rental business. In both cases, the lease and rental payments received fully cover the capital costs of the lease and rental fleet (i.e., the interest expense on the borrowings used to acquire the vehicles and the depreciation expense associated with the vehicles), plus a profit margin for the Company. The Company believes excluding the FPNP and L&RFD from the Company’s total debt for this purpose provides management with supplemental information regarding the Company’s capital structure and leverage profile and assists investors in performing analysis that is consistent with financial models developed by Company management and research analysts. “Adjusted Total Debt” and “Adjusted Net (Cash) Debt” are both non-GAAP financial measures and should be considered in addition to, and not as a substitute for, the Company’s debt obligations, as reported in the Company’s consolidated balance sheet in accordance with U.S. GAAP. Additionally, these non-GAAP measures may vary among companies and may not be comparable to similarly titled non-GAAP measures used by other companies.
| Twelve Months Ended | ||||||
| EBITDA (in thousands) | June 30, 2024 | June 30, 2023 | ||||
| Net Income attributable to Rush Enterprises, Inc. (GAAP) | $ | 308,594 | $ | 377,432 | ||
| Provision for income taxes | 101,252 | 120,187 | ||||
| Interest expense | 67,133 | 37,958 | ||||
| Depreciation and amortization | 63,213 | 56,940 | ||||
| (Gain) on sale of assets | (569 | ) | (2,607 | ) | ||
| EBITDA (Non-GAAP) | 539,623 | 589,910 | ||||
| Adjustments: | ||||||
| Interest expense associated with FPNP and L&RFD | (68,283 | ) | (38,645 | ) | ||
| Adjusted EBITDA (Non-GAAP) | $ | 471,430 | $ | 551,265 | ||
The Company presents EBITDA and Adjusted EBITDA, for the twelve months ended each period presented, as additional information about its operating results. The presentation of Adjusted EBITDA that excludes the addition of interest expense associated with FPNP and the L&RFD to EBITDA is consistent with management’s presentation of Adjusted Total Debt, in each case reflecting management’s view of interest expense associated with the FPNP and L&RFD as an operating expense of the Company, and to provide management with supplemental information regarding operating results and to assist investors in performing analysis that is consistent with financial models developed by management and research analyst. “EBITDA” and “Adjusted EBITDA” are both non-GAAP financial measures and should be considered in addition to, and not as a substitute for, net income of the Company, as reported in the Company’s consolidated statements of income in accordance with U.S. GAAP. Additionally, these non-GAAP measures may vary among companies and may not be comparable to similarly titled non-GAAP measures used by other companies.
| Twelve Months Ended | ||||||
| Free Cash Flow (in thousands) | June 30, 2024 | June 30, 2023 | ||||
| Net cash provided by operations (GAAP) | $ | 297,562 | $ | 350,566 | ||
| Acquisition of property and equipment | (355,742 | ) | (321,834 | ) | ||
| Free cash flow (Non-GAAP) | (58,180 | ) | 28,732 | |||
| Adjustments: | ||||||
| Draws on floor plan financing, net | 102,889 | 274,425 | ||||
| Acquisitions of L&RF assets | 250,925 | 236,976 | ||||
| Non-maintenance capital expenditures | 27,908 | 24,358 | ||||
| Adjusted Free Cash Flow (Non-GAAP) | $ | 323,542 | $ | 564,491 | ||
“Free Cash Flow” and “Adjusted Free Cash Flow” are key financial measures of the Company’s ability to generate cash from operating its business. Free Cash Flow is calculated by subtracting the acquisition of property and equipment included in the Cash flows from investing activities from Net cash provided by (used in) operating activities. For purposes of deriving Adjusted Free Cash Flow from the Company’s operating cash flow, Company management makes the following adjustments: (i) adds back draws (or subtracts payments) on the floor plan financing that are included in Cash flows from financing activities, as their purpose is to finance the vehicle inventory that is included in Cash flows from operating activities; (ii) subtracts lease and rental fleet purchases that are included in acquisition of property and equipment (iii) adds back non-maintenance capital expenditures that are for growth and expansion (i.e. building of new dealership facilities) that are not considered necessary to maintain the current level of cash generated by the business. “Free Cash Flow” and “Adjusted Free Cash Flow” are both presented so that investors have the same financial data that management uses in evaluating the Company’s cash flows from operating activities. “Free Cash Flow” and “Adjusted Free Cash Flow” are both non-GAAP financial measures and should be considered in addition to, and not as a substitute for, net cash provided by (used in) operations of the Company, as reported in the Company’s consolidated statement of cash flows in accordance with U.S. GAAP. Additionally, these non-GAAP measures may vary among companies and may not be comparable to similarly titled non-GAAP measures used by other companies.
| Invested Capital (in thousands) | June 30, 2024 | June 30, 2023 | ||||
| Total Rush Enterprises, Inc. Shareholders' equity (GAAP) | $ | 2,003,461 | $ | 1,868,170 | ||
| Adjusted net debt (cash) (Non-GAAP) | (163,230 | ) | (187,715 | ) | ||
| Adjusted Invested Capital (Non-GAAP) | $ | 1,840,231 | $ | 1,680,455 | ||
“Adjusted Invested Capital” is a key financial measure used by the Company to calculate its return on invested capital. For purposes of this analysis, management excludes L&RFD, FPNP, and cash and cash equivalents, for the reasons provided in the debt analysis above and uses Adjusted Net Debt in the calculation. The Company believes this approach provides management a more accurate picture of the Company’s leverage profile and capital structure and assists investors in performing analysis that is consistent with financial models developed by Company management and research analysts. “Adjusted Net (Cash) Debt” and “Adjusted Invested Capital” are both non-GAAP financial measures. Additionally, these non-GAAP measures may vary among companies and may not be comparable to similarly titled non-GAAP measures used by other companies.
Contact:
Rush Enterprises, Inc., San Antonio
Steven L. Keller, 830-302-5226
FAQ
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