PACCAR Celebrates 80th Consecutive Year Of Profits

“The North American and European economies are projected to continue growing in 2019.  Our customers are very profitable and benefiting from strong freight demand.  Freight activity grew 6.6% percent in the U.S. in 2018, the highest growth in 20 years.  Kenworth and Peterbilt’s 2019 build schedules are substantially full due to the robust orders.  We expect 2019 to be another excellent year for PACCAR,” added Armstrong. 

PACCAR achieved record quarterly revenues of $6.28 billion in the fourth quarter 2018, a 15% increase compared to the $5.45 billion reported in the same period in 2017.  The company earned $578.1 million ($1.65 per diluted share) in the fourth quarter of 2018.  PACCAR earned $589.2 million ($1.67 per diluted share) in the fourth quarter of 2017, including $173.4 million of net tax benefits resulting from changes to U.S. tax law.  Excluding the one-time tax benefits, PACCAR reported adjusted net income (non-GAAP)1 of $415.8 million ($1.18 per diluted share) in the fourth quarter of 2017.    

PACCAR achieved record revenues of $23.50 billion in 2018, a 21% increase compared to revenues of $19.46 billion in 2017.  The company earned a record $2.20 billion ($6.24 per diluted share) in 2018, 31% higher than the $1.68 billion ($4.75 per diluted share) earned in 2017.  PACCAR’s 2018 net income of $2.20 billion increased 47% compared to 2017 adjusted net income of $1.50 billion ($4.26 per diluted share).

Increased Dividends and Share Repurchases

PACCAR declared cash dividends of $3.09 per share during 2018, a 41% increase compared to the $2.19 per share declared in 2017.  Dividends declared in 2018 included a $2.00 per share extra cash dividend paid in January 2019.  PACCAR has increased its regular quarterly dividend an average of 11% per year during the last 20 years.  PACCAR’s Board of Directors approved in December 2018 an additional 14% increase in the regular quarterly dividend to $.32 per share beginning in the first quarter of 2019.  “PACCAR has delivered annual dividends, including regular quarterly and extra cash dividends, totaling approximately 50% of net income for many years,” said Harrie Schippers, PACCAR president and chief financial officer.  “PACCAR’s total dividend yield, including regular quarterly and extra cash dividends declared in 2018, was an excellent 5.4% as of December 31, 2018.”

PACCAR repurchased 5.85 million of its common shares for $354.4 million during 2018.  PACCAR’s Board of Directors approved the repurchase of $300 million of its outstanding common stock in July 2018, and the repurchase of an additional $500 million of its common stock in December 2018.  Stock repurchases of $539.9 million are remaining under these authorizations.

Business Highlights – 2018

PACCAR delivered a record 189,100 vehicles worldwide.

DAF achieved record above 16-tonne market share of 16.6% in Europe, compared to 15.3% in 2017.

DAF earned the prestigious International Truck of the Year 2018 award, and was honored with national Truck of the Year awards in the U.K., Poland, Slovakia and Slovenia.

PACCAR participated in the CES 2018 and 2019 shows in Las Vegas, Nevada, exhibiting Peterbilt autonomous Model 579, Peterbilt electric Model 579, Peterbilt electric Model 220 and Kenworth zero emission, hydrogen fuel cell electric T680 trucks.

DAF introduced CF Electric, LF Electric and CF Hybrid vehicles at the IAA 2018 truck show in Hannover, Germany.

DAF was honored with the Computable Award 2018 in The Netherlands for its 3D Truck Configurator web application.

Peterbilt and Kenworth were recognized as top workplaces for women by Women in Trucking, an organization that promotes the employment and success of women in the trucking industry.

DAF Brasil increased its market share in the above 40-tonne truck segment to 6.7%, and earned the Truck Brand of the Year honor for the third consecutive year by the Brasilian national dealer association, Fenabrave.

Peterbilt in Denton, Texas, the PACCAR engine factory in Columbus, Mississippi and PACCAR Ste-Thérèse, Canada each earned a prestigious Manufacturing Leadership Award from Frost & Sullivan, a leading industry research firm.

PACCAR achieved an elite “A” rating from CDP for its environmental practices.

Financial Highlights – Fourth Quarter 2018

Highlights of PACCAR’s financial results during the fourth quarter of 2018 include:

Record quarterly net sales and revenues of $6.28 billion. 

Record quarterly worldwide deliveries of 50,400 trucks.

Net income of $578.1 million, 9.2% after-tax return on revenues.

Record PACCAR Parts revenue of $970.9 million.

PACCAR Parts pretax income of $193.8 million, 20.0% pre-tax return on revenues.

PACCAR Financial Services earned $87.2 million.

Research and development expenses of $80.5 million.

Capital investments of $135.1 million.

Financial Highlights – Full Year 2018

Highlights of PACCAR’s financial results during 2018 include:

Record net sales and revenues of $23.50 billion.

Record net income of $2.20 billion, 9.3% after-tax return on revenues.

Record PACCAR Parts revenue of $3.84 billion.

Record PACCAR Parts pretax income of $768.6 million.

Record Financial Services new business volume of $5.23 billion.

Financial Services pretax income of $305.9 million.

Cash provided by operations of $2.99 billion.

Dividends declared of $1.08 billion.

Medium-term note issuances of $2.21 billion.

PACCAR invested $743.2 million in capital projects and research and development.

Record year-end stockholders’ equity of $8.59 billion.

After-tax return on equity of 27.3%.

Global Truck Markets

 “Strong GDP, industrial production and consumer spending growth in 2018 resulted in record freight tonnage, high fleet capacity utilization and record Kenworth and Peterbilt truck orders, deliveries and backlog,” said Preston Feight, PACCAR executive vice president.  Class 8 truck industry retail sales in the U.S. and Canada were 285,000 units in 2018, 30% higher than the 218,000 vehicles sold in 2017.  U.S. and Canada Class 8 truck industry retail sales are expected to increase to a range of 285,000-315,000 trucks in 2019.

European truck industry registrations above 16-tonnes were a robust 319,000 trucks in 2018.  It is estimated that European truck industry registrations in the above 16-tonne market in 2019 will be another excellent year in the range of 290,000-320,000 trucks.  “European transport activity and truck demand have been strong due to five consecutive years of steady European economic growth,” said Harry Wolters, DAF president.  “DAF produced a record number of trucks and achieved record above 16-tonne market share of 16.6% in 2018.  DAF trucks, including the DAF XF and CF ‘International Truck of the Year 2018,’ deliver premium quality, exceptional fuel efficiency and superior driver comfort for our customers.”