PACCAR Achieves Excellent Financial Performance
“PACCAR reported excellent revenues and net income in the first quarter of 2024,” said Preston Feight, chief executive officer. “PACCAR’s results reflect ongoing demand for premium quality DAF, Peterbilt and Kenworth trucks, aftermarket parts and financial services. I am very proud of our employees and dealers who have delivered outstanding trucks and transportation solutions to our customers.”
PACCAR achieved quarterly revenues of $8.74 billion in the first quarter of 2024, compared to the $8.47 billion reported in the same period in 2023. The company achieved net income of $1.20 billion ($2.27 per diluted share) in the first quarter of 2024. PACCAR reported net income of $733.9 million ($1.40 per diluted share) in the first quarter last year, including a $446.4 million after-tax, non-recurring charge related to civil litigation in Europe. Excluding the non-recurring charge, the company earned adjusted net income (non-GAAP)1 of $1.18 billion ($2.25 per diluted share) in the first quarter of 2023.
Feight added, “PACCAR’s long-term investments in new truck models, advanced manufacturing and technology-enabled aftermarket solutions are contributing to PACCAR’s strong operating margins. Customers’ operations benefit from the superior quality and fuel economy of DAF, Peterbilt and Kenworth vehicles. PACCAR is developing next-generation powertrains and connected systems, which will drive aftermarket parts growth, as well as investing in production capacity.”
Highlights – First Quarter 2024
Highlights of PACCAR’s financial results during the first quarter of 2024 include:
- Consolidated revenues of $8.74 billion.
- Net income of $1.20 billion.
- Record PACCAR Parts revenue of $1.68 billion.
- Record PACCAR Parts pretax income of $455.8 million.
- PACCAR Financial Services pretax income of $113.9 million.
- Cash provided by operations of $1.47 billion.
- Capital investment of $164.3 million and R&D expense of $105.5 million.
- Stockholders’ equity of $16.87 billion.
Global Truck Markets
“North American truck demand is benefiting from increased infrastructure spending,” said Mike Dozier, PACCAR executive vice president. “Kenworth and Peterbilt’s industry-leading vocational trucks provide customers with the premium quality and durability required in rigorous construction applications.” U.S. and Canada Class 8 truck industry retail sales are estimated to be in a range of 250,000-290,000 trucks in 2024. Kenworth and Peterbilt achieved a combined class 8 market share of 30.3% in the first quarter of 2024, compared to 29.5% last year.
Kenworth T880 truck
“The aerodynamic and innovative DAF XD, XF, XG and XG+ trucks offer best-in-class driver comfort and fuel efficiency to customers,” said Harald Seidel, DAF president. “DAF was honored as the Fleet Manufacturer of the Year and the DAF XD truck was named Best Rigid Truck at the prestigious Fleet News Awards in London this quarter.” European truck industry registrations for the above 16-tonne market in 2024 are projected to be between 260,000 and 300,000 trucks.
DAF XD truck
The South American above 16-tonne truck market is projected to be in the range of 105,000-115,000 trucks in 2024. DAF Brasil achieved a record 10.7% market share in the Brasil above 16-tonne market in the first quarter of 2024, compared to 8.6% in the same period last year. Mike Kuester, PACCAR assistant vice president of South America, noted, “DAF’s industry-leading quality trucks, complemented by PACCAR Parts, PACCAR Financial Services and DAF’s premium dealerships, are driving DAF Brasil to record market share.”
PACCAR Parts Achieves Record Revenues and Profits
PACCAR Parts achieved record quarterly pre-tax income of $455.8 million, compared to $438.6 million earned in the first quarter of 2023. First quarter 2024 revenues were a record $1.68 billion compared to $1.62 billion reported in the same period last year. Laura Bloch, PACCAR vice president and PACCAR Parts general manager, said, “PACCAR Parts provides strategic, technology-driven transportation solutions that deliver greater uptime and profitability for customers. PACCAR Parts’ excellent performance reflects investments in its TRP all-makes parts and TRP stores, technologies such as managed dealer inventory, and a growing number of PACCAR trucks with PACCAR powertrains in operation.” PACCAR Parts’ private label brand, TRP, celebrates 30 years of success in 2024. TRP offers a selection of more than 157,000 parts designed for all makes and models of trucks, trailers and buses.
TRP Store
PACCAR Parts’ 19 global parts distribution centers support more than 2,300 DAF, Kenworth and Peterbilt dealer locations. PACCAR is constructing a new, 240,000 square-foot PACCAR PDC to be opened in Massbach, Germany, in 2024. The new PDC in Germany will enhance parts delivery to dealers and customers in the largest truck market in Europe.
Parts Distrubution Center in Massbach, Germany (rendering)
PACCAR Financial Services Achieves Good Quarterly Profits
PACCAR Financial Services (PFS) achieved pretax income of $113.9 million in the first quarter of 2024, compared to $148.8 million earned in the first quarter of 2023. First quarter 2024 revenues were a record $509.3 million compared to $423.2 million in the same quarter of last year. “PFS achieved good quarterly results due to its growing portfolio and strong portfolio quality. The used truck market has normalized after two years of high volume and prices,” said Todd Hubbard, PACCAR vice president. “PFS is a leader in the market with its superior Kenworth, Peterbilt and DAF products, innovative technologies that provide seamless credit application and loan processing, and its support of customers in all phases of the business cycle.”
PFS has a portfolio of 228,000 trucks and trailers, with total assets of $21.15 billion. PacLease, a major full-service truck leasing company in North America and Europe with a fleet of over 41,000 vehicles, is included in this segment. “PACCAR’s strong balance sheet, complemented by its A+/A1 credit ratings, enables PFS to offer competitive retail financing to Kenworth, Peterbilt and DAF dealers and customers in 26 countries on four continents,” said Craig Gryniewicz, PACCAR Financial Corp. president. “PACCAR Financial Services has excellent access to the debt markets, issuing $950 million in medium-term notes during the first quarter of 2024.”
Capital and R&D Investments in Products, Technologies and Facilities
PACCAR’s consistent long-term profits, strong balance sheet, and focus on quality, technology and innovation have enabled the company to invest $7.9 billion in world-class facilities, next generation products and state of the art technologies during the past decade. PACCAR invested $164.3 million in capital projects and $105.5 million in research and development expenses in the first quarter of 2024. Harrie Schippers, president and chief financial officer, said, “Capital expenditures are projected to be in the range of $700-$750 million and research and development expenses are estimated to be in the range $460-$500 million in 2024. PACCAR is increasing its investment in new powertrains, advanced manufacturing capabilities and capacity, and aftermarket distribution capabilities that will create value for our customers.”
PACCAR’s advanced battery cell manufacturing joint venture is expected to begin construction of its 21-gigawatt hour (GWh) factory in Marshall County, Mississippi, in the second quarter of 2024, and start production in 2027. PACCAR anticipates investing $600-$900 million in the joint venture.
PACCAR is a global technology leader in the design, manufacture and customer support of high-quality light-, medium- and heavy-duty trucks under the Kenworth, Peterbilt and DAF nameplates. PACCAR also designs and manufactures advanced powertrains, provides financial services and information technology, and distributes truck parts related to its principal business.
PACCAR will hold a conference call with securities analysts to discuss first quarter earnings on April 30, 2024, at 8:00 a.m. Pacific time. Interested parties may listen to the call by selecting “Q1 Earnings Webcast” at PACCAR’s homepage. The webcast will be available on a recorded basis through May 7, 2024. PACCAR shares are traded on the Nasdaq Stock Market, symbol PCAR. Its homepage is www.paccar.com.
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements due to a variety of factors. More information about these factors is contained in PACCAR’s filings with the Securities and Exchange Commission.
1 See attached supplementary information on non-GAAP financial measures.