“PACCAR achieved record revenues and net income in the second quarter of 2022 due to increased deliveries of new truck models, excellent gross margins and record PACCAR Parts results,” said Preston Feight, chief executive officer. “PACCAR Parts achieved record quarterly sales and profits due to high truck utilization and industry-leading logistics performance that enhanced customer uptime. PACCAR Financial Services delivered excellent profitability due to its high quality portfolio and strong used truck prices. I am very proud of our employees for delivering the highest quality trucks and transportation solutions to our customers.”
PACCAR earned net income of $720.4 million ($2.07 per diluted share) in the second quarter, an increase of 45% compared to $495.5 million ($1.42 per diluted share) earned in the same period last year. Second quarter net sales and financial services revenues were $7.16 billion, compared to $5.84 billion achieved in the second quarter of 2021. PACCAR achieved Truck, Parts and Other gross margins of 14.4% compared to 13.5% in the same period last year.
PACCAR reported first half net income of $1.32 billion ($3.79 per diluted share), compared to $966.3 million ($2.77 per diluted share), earned in the first six months of last year. Net sales and financial services revenues for the first six months of 2022 were $13.63 billion, compared to $11.69 billion achieved last year.
Quarterly Dividend
PACCAR’s Board of Directors declared a regular quarterly cash dividend of thirty-four cents ($.34) per share, payable on September 7, 2022, to stockholders of record at the close of business on August 17, 2022.
Financial Highlights – Second Quarter 2022
Highlights of PACCAR’s financial results for the second quarter of 2022 include:
- Net sales and revenues of $7.16 billion.
- Net income of $720.4 million.
- Global truck deliveries of 46,900 units.
- PACCAR Parts revenues of $1.43 billion.
- PACCAR Parts pretax income of $353.3 million.
- PACCAR Financial Services pretax income of $144.4 million.
- Manufacturing cash and marketable securities of $4.69 billion.
- Cash generated from operations of $638.2 million.
- Stockholders’ equity of $12.52 billion.
Financial Highlights – First Half 2022
Highlights of PACCAR’s financial results for the first six months of 2022 include:
- Net sales and revenues of $13.63 billion.
- Net income of $1.32 billion.
- Capital investments of $234.5 million and R&D expenses of $158.4 million.
- PACCAR Parts pretax income of $693.5 million.
- PACCAR Financial Services pretax income of $291.4 million.
- Cash generated from operations of $1.10 billion.
- Medium-term note issuances of $1.63 billion.
Global Truck Markets Are Strong
“Strong freight tonnage, excellent industry truck utilization and ongoing customer demand for new Kenworth and Peterbilt trucks highlighted the second quarter. Customers appreciate the enhanced fuel efficiency and advanced technology in Kenworth and Peterbilt’s new heavy- and medium-duty trucks,” commented Darrin Siver, senior vice president. Class 8 industry retail sales in the U.S. and Canada are estimated to be in a range of 260,000-290,000 trucks this year. Kenworth and Peterbilt’s Class 8 retail sales market share is 29.4% year-to-date.
“DAF’s innovative range of premium new trucks has resulted in excellent demand and an increase in DAF’s European above 16-tonne year-to-date market share to 17.5%,” shared Harry Wolters, DAF president. “The new DAF trucks are delivering the highest fuel efficiency in the industry, which is appealing to our customers faced with increased energy costs.” European truck industry registrations in the above 16-tonne segment are estimated to be in a range of 270,000-300,000 vehicles this year.
Mike Dozier, senior vice president, said, “The South American above 16-tonne truck market is robust this year and in the range of 125,000-135,000 units.” DAF Brasil’s market share was 6.9% in the above 16-tonne truck segment in the first six months of this year.
PACCAR Demonstrates Zero Emissions Leadership
A DAF CF Electric truck became the first battery electric heavy truck to summit Austria’s highest mountain pass on the Grossglockner Alpine Road. The vehicle exhibited superb power and maneuverability through 30 miles, 36 hairpin bends and a grade of 12%. The DAF CF Electric is used by customers in applications such as regional distribution, refuse collection and port drayage. John Rich, chief technology officer, said, “The DAF CF Electric demonstrates PACCAR’s leadership in battery electric vehicles. PACCAR has increased electric vehicle production this year, with several hundred units in the backlog.”
PACCAR Parts Achieves Record Quarterly Revenues and Profits
PACCAR Parts earned quarterly pretax income of $353.3 million in the second quarter of 2022, 32% higher than the $266.8 million earned in the same period last year. PACCAR Parts achieved second quarter revenues of $1.43 billion, compared to the $1.21 billion reported in the same period last year. PACCAR Parts first half 2022 revenues were $2.82 billion, compared to $2.37 billion in the same period last year. PACCAR Parts achieved pretax profit of $693.5 million in the first six months of 2022, compared to $518.4 million earned in the first six months of 2021.
“Customers’ increased truck utilization and higher average fleet age contributed to PACCAR Parts’ record results. PACCAR Parts’ advanced technology solutions increase customers’ uptime by providing optimized logistics support from 18 strategically located PDCs,” noted Laura Bloch, PACCAR vice president and PACCAR Parts general manager. “PACCAR Parts’ innovative programs include TRP all-makes parts, 250 independent TRP stores, managed dealer inventory and innovative e-commerce technology. The growing TRP business is designed to increase PACCAR’s parts business by offering high quality TRP components for older PACCAR trucks, as well as vehicles manufactured by other companies.”
PACCAR Parts global PDCs support more than 2,200 DAF, Kenworth and Peterbilt dealer sales, parts and service locations. PACCAR Parts will open a new 260,000 square foot PDC in Louisville, Kentucky in the third quarter to further enhance parts availability for customers and dealers.
Financial Services Companies Achieve Excellent Results
PACCAR Financial Services (PFS) earned pretax income of $144.4 million in the second quarter this year compared to $106.5 million in the second quarter of 2021. PFS achieved second quarter 2022 revenues of $372.5 million compared to $456.3 million in the same period last year. For the first six months of 2022, PFS earned pretax income of $291.4 million compared to $182.9 million last year. First half 2022 revenues were $738.7 million compared with $888.3 million for the same period a year ago. Todd Hubbard, vice president, said, “PFS achieved excellent second quarter results due to its high quality portfolio and strong used truck performance. Fleet operators and drivers appreciate the many advantages of Peterbilt, Kenworth and DAF pre-owned trucks, including outstanding durability and reliability.” A new PFS used truck facility will open this year in Madrid, Spain. Kenworth and Peterbilt truck resale values command a 10-20% premium over competitors’ trucks.
PFS has a portfolio of 210,000 trucks and trailers, with total assets of $16.04 billion. PacLease, a major full-service truck leasing company in North America, Europe and Australia with a fleet of 39,000 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 commercial paper on a regular basis and $1.63 billion of two-, three- and five-year term notes during the first half of 2022.
Capital and R&D Investments in Products, Technologies and Facilities
PACCAR’s excellent long-term profits, strong balance sheet, and consistent focus on quality, technology and productivity have enabled the company to invest $7.3 billion in new and expanded facilities, innovative products and new technologies during the past decade. Capital investments are estimated to be in a range of $425-$475 million, and research and development expenses to be in a range of $330-$350 million, this year. “PACCAR is increasing its investment in clean diesel and electric powertrain technologies, autonomous systems, connected vehicle services, next-generation manufacturing and parts distribution capabilities,” said Harrie Schippers, president and chief financial officer. “In the second quarter, Kenworth began construction of a state-of-the-art 105,000 square-foot expansion at its Chillicothe, Ohio truck factory.”