PACCAR 2011 Annual Report Download - page 31

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The major factors for the changes and interest in fees, interest and other borrowing expenses and finance margin for the
year ended December 31, 2011 are outlined in the table below:
INTEREST AND
INTEREST OTHER BORROWING FINANCE
($ in millions) AND FEES EXPENSES MARGIN
2010 $ 421.6 $ 213.0 $ 208.6
Increase (decrease)
Average finance receivables 21.8 21.8
Yields (32.1) (32.1)
Average debt balances 15.5 (15.5)
Borrowing rates (53.4) 53.4
Currency translation 11.8 6.2 5.6
Total increase (decrease) 1.5 (31.7) 33.2
2011 $ 423.1 $ 181.3 $ 241.8
•฀ ฀Average฀finance฀receivables฀increased฀$319.2฀million฀(net฀of฀$173.2฀million฀of฀foreign฀exchange฀effects)฀from฀an฀
increase in dealer wholesale financing, primarily in the U.S. and Canada and Europe as well as retail portfolio
new business volume exceeding repayments.
•฀ ฀Lower฀market฀rates฀resulted฀in฀lower฀portfolio฀yields.฀
•฀ ฀Average฀debt฀balances฀increased฀$409.0฀million฀in฀2011,฀reflecting฀funding฀needed฀for฀a฀higher฀average฀finance฀
receivable portfolio.
•฀ ฀Borrowing฀rates฀declined฀in฀2011฀due฀to฀lower฀market฀interest฀rates.฀
•฀ ฀Currency฀translation฀primarily฀relates฀to฀the฀stronger฀euro.฀
The following table summarizes operating lease, rental and other income and depreciation and other expense:
($ in millions)
Year ended December 31, 2011 2010
Operating lease revenues $ 567.0 $฀498.7
Used฀truck฀sales฀and฀other฀ ฀39.2 47.5
Operating leases, rental and other income $ 606.2 $ 546.2
Depreciation of equipment on operating leases $ 346.6 $ 325.6
Vehicle operating expenses 103.2 ฀ 92.1
Cost฀of฀used฀truck฀sales฀and฀other฀ ฀26.4 ฀ 33.9
Depreciation and other expense $ 476.2 $ 451.6
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