Rush Enterprises sets revenue record
Rush Enterprises, Inc. Wednesday reported record annual revenues of $3.4 billion compared to $3.1 billion in 2012 and a net income of $49.2 million.
In the fourth quarter of 2013, the company’s gross revenues totaled $925.2 million, a 26.3 percent increase from gross revenues of $732.3 million reported for the fourth quarter of 2012. Net income for the quarter was $14.9 million. For the year ending Dec. 31, 2013, the company’s gross revenues totaled $3.4 billion, a 9.5 percent increase from gross revenues of $3.1 billion reported in 2012.
“2013 was a year of continued investment, growth and solid financial performance, for our Company,” says Rusty Rush, Chairman, CEO and President of Rush Enterprises, Inc. “We achieved record annual revenues, increased medium-duty, light-duty and used truck sales, and expanded our leasing business and revenues.”
Rush says the company also augmented its solutions capabilities, completed expansion projects on existing facilities and acquired five dealer groups, adding 29 dealership locations to the Rush Truck Centers network.
“I am proud of our performance in 2013 and extremely grateful to all our employees who contributed to the company’s success this year, especially given our rapid pace of growth,” he says. “We welcomed more than 1,300 new employees to the company in 2013 and look forward to serving new and existing customers across the country with excellence.”
In 2013, the Rush dealer network swelled to to 107 locations in 20 states across the country, entrenching Rush Enterprises as the largest network of commercial vehicle dealerships in North America.
“We want to consistently service customers when and where they operate – locally, regionally and nationally,” Rush says. “We made substantial progress towards our growth strategy in two ways – by investing in our core Peterbilt Division and expanding our Navistar footprint.”
Rush says the company strengthened its Peterbilt Division by investing in facility expansions, building new dealerships and developing aftermarket services. In 2013, the Company opened a new Peterbilt, Hino and Paclease dealership and leasing operation in Corpus Christi, Texas and renovated existing facilities in Laredo, Houston and Dallas to increase square footage and capabilities.
The company also has projects underway to construct new facilities in San Antonio, Texas and Denver, Colo. and increase capacity in Abilene, Texas and Whittier, Calif. in 2014.
“We also installed dedicated natural gas service bays at certain dealerships in Oklahoma and Texas and have plans underway for similar investments in Arizona, Colorado, Florida, Tennessee, and Texas,” Rush adds. “When completed, these projects will result in a direct investment of more than $40 million in our Peterbilt Division.”
Rush Enterprises also ballooned the size of its Navistar Division through several acquisitions.
“With these newly acquired locations and others previously acquired in Ohio, North Carolina, Kansas, Missouri and Virginia since December 31, 2012, we have more than doubled the size of our Navistar Division locations. We believe these acquired stores will cumulatively produce approximately $1 billion in annual revenue in 2014.”
“Equally important to the number of dealerships we added is where we added them,” Rush adds. “We acquired locations in the Midwest and Mid-Atlantic United States, where Navistar has strong market share and where we had not previously had a significant presence.”
In 2013, Rush’s Class 8 retail sales of 9,545 units accounted for 5.1 percent of the total U.S. Class 8 retail truck sales market. U.S. Class 8 retail sales in 2013 decreased 6 percent, to 187,610 units from 198,715 units in 2012.
“As anticipated, energy sector customers delayed truck purchases in 2013 as they worked through excess capacity purchased in 2011 and 2012, and large fleets experienced continued driver shortages. Incremental truck sales from our newly acquired Navistar locations did help offset the decline in our Class 8 truck sales,” said Rush.
“Peterbilt continues to be a strong player in the fleet, owner-operator and vocational segments and its next generation product line has gained market acceptance. In addition, our sales of Peterbilt’s natural gas-powered Class 8 trucks continue to rise, having sold more than 800 trucks in 2013. We expect natural gas will continue to gain momentum as the fueling infrastructure is put in place across the country,” Rush continued.
“Navistar continues to gradually regain market share. We believe truck sales from our Navistar Division will continue to improve in 2014 as customers continue to gain confidence in their truck and engine combinations,” said Rush.
Rush’s U.S. Class 4-7 medium-duty truck sales reached 8,441 units in 2013, up 18 percent over 2012, and accounted for 4.7 percent of the U.S. Class 4-7 market. Light-duty truck sales also increased 41 percent over last year.
“Continued improvement in housing and construction, growth in the vocational fleet market and incremental truck sales from newly acquired locations drove improvement in medium-duty truck sales this year,” Rush says.
Used truck sales were also up 35 percent in 2013.
“We expect demand for used trucks will continue as fewer new trucks built from 2008 to 2010 come into the secondary market,” he says. “We are developing new business models to take advantage of the used truck market potential.”
The company delivered 2,787 new heavy-duty trucks, 2,040 new medium-duty commercial vehicles, 526 new light-duty commercial vehicles and 1,838 used commercial vehicles during the fourth quarter of 2013, compared to 2,102 new heavy-duty trucks, 1,801 new medium-duty commercial vehicles, 393 new light-duty commercial vehicles and 1,039 used commercial vehicles in the fourth quarter of 2012.
Industry experts forecast U.S. retail sales for Class 8 vehicles to reach 213,500 units in 2014, a 14 percent increase over 2013. Industry experts also forecast U.S. retail sales for Class 4-7 vehicles to reach 193,500 units in 2014, an 8 percent increase over 2013.
“With the economy gaining momentum, order intake climbing in the past few months, and improved activity in automotive, housing, construction and energy sectors, we believe retail sales could improve in the second half of 2014,” Rush says.
“We also believe the incremental business resulting from recent acquisitions, and our ability to offer innovative aftermarket solutions to customers will positively impact Rush’s heavy- and medium-duty truck sales in 2014.”
Aftermarket services accounted for nearly 65 percent of the company’s total gross profits in 2013 with parts, service and body shop revenues reaching a new record of $988.3 million, up 20.9 percent over 2012.
“Continued strong demand for maintenance and repair of aged vehicles combined with our expanding portfolio of aftermarket solutions continued to drive strong parts, service and body shop revenues throughout the year, ” Rush says. “Keeping our customers up and running, when and where they need it, is a top priority for our parts and service network. We continue to invest in technology, human resources, training and facilities to enhance our capabilities in mobile service, custom vehicle modifications, alternate fuel service, repair diagnostics, rapid parts delivery, customer communication and preventive care. We continue to evaluate all opportunities to add innovative products or services to expand our solutions capabilities.”
Parts, service and body shop revenue was $256.4 million in the fourth quarter of 2013, compared to $201.6 million in the fourth quarter of 2012.