PACCAR 2012 Annual Report Download - page 4

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T O O U R S H A R E H O L D E R S
PACCAR had a very good year in 2012, due to increased truck market share in
North America and Europe, customers updating their fleets and strong aftermarket
parts and finance business. The company has earned an impressive 74 consecutive
years of net income. This remarkable achievement was due to our 21,800 employees
who delivered industry-leading product quality, innovation and outstanding operating
efficiency. PACCAR benefited from its global diversification, superior financial
strength and steady growth from aftermarket parts business and financial services.
PACCAR’s $790 million of capital investment and research and development in 2012
enhanced its manufacturing capability and contributed to many new product
introductions. PACCAR delivered 140,400 trucks to its customers and sold $2.7 billion of
aftermarket parts. PACCAR’s excellent S&P credit rating of A+ results from consistent
profitability, a strong balance sheet and good cash flow. Looking ahead to 2013, the
North American and European truck markets are expected to be similar to 2012. It is
anticipated that there will be continued growth in the aftermarket parts business due
to the aging of the truck parc. PACCAR Financial revenues should increase due to a
growing portfolio.
PACCAR’s net income of $1.11 billion on revenues of $17.1 billion was the fourth
best in company history. PACCAR declared regular dividends of $.78 per share and a
special dividend of $.80 per share. Regular quarterly cash dividends have tripled in
the last 10 years. Shareholder equity is a record $5.8 billion.
Class 8 industry truck sales in North America, including
Mexico, rose to 249,000 vehicles in 2012 compared to
216,000 units the prior year. The European 16+ tonne
market in 2012 declined to 222,000 vehicles, compared
to 242,000 in 2011. Our customers are generating
better profits due to increased freight and higher rates.
PACCAR’s excellent financial performance in 2012
resulted from higher truck sales and record profits in
Financial Services. The company’s 2012 after-tax return
on revenues was 6.5%. After-tax return on beginning