Summary
PACCAR Inc's 2016 10-K filing reveals a challenging year marked by a significant European Commission (EC) fine, which impacted net income. Despite a 9% decline in worldwide truck deliveries and a 2% drop in parts sales, PACCAR demonstrated resilience. Truck segment sales were down 14% year-over-year, primarily due to lower deliveries in the U.S. and Canada, though this was partially offset by a 11% increase in European truck sales. Financially, adjusted net income (excluding the EC charge) was $1.35 billion, a notable decrease from $1.60 billion in 2015, but highlighted the company's underlying operational strength. The company continued its commitment to R&D and capital investments, including significant upgrades to manufacturing facilities and a new DAF cab paint facility in Belgium. PACCAR maintained its strong market share in both North America and Europe, and its financial services segment continued to support truck sales, albeit with slightly lower pre-tax profit due to various market factors. The company provided an outlook for 2017, expecting truck industry retail sales in the U.S. and Canada to be between 190,000 to 220,000 units, and for Europe (over 16-tonne vehicles) to be between 260,000 to 290,000 units. PACCAR Parts sales were projected to grow slightly in North America and Europe. Management expressed confidence in the company's liquidity and financial stability, supported by strong credit ratings and access to capital markets.
Financial Highlights
34 data points| Revenue | $17.03B |
| Net Income | $521.70M |
| EPS (Basic) | $0.99 |
| EPS (Diluted) | $0.99 |
| Shares Outstanding (Basic) | 527 |
| Shares Outstanding (Diluted) | 528 |
Key Highlights
- 12016 Net Income impacted by an $833 million EC charge, resulting in GAAP Net Income of $521.7 million ($1.48/share), compared to $1.60 billion ($4.51/share) in 2015. Adjusted Net Income (non-GAAP) was $1.35 billion ($3.85/share).
- 2Worldwide truck deliveries decreased 9% to 140,900 units, with U.S. and Canada down 22% and Europe up 12%.
- 3PACCAR maintained strong market share: 28.5% in U.S./Canada Class 8 (up from 27.4%), and 15.5% in European heavy-duty trucks (up from 14.6%).
- 4Capital investments increased to $402.7 million, focused on new facilities (DAF cab paint, Peterbilt expansion) and technology.
- 5Financial Services segment saw revenues increase slightly to $1.19 billion, but pre-tax profit decreased to $306.5 million from $362.6 million due to various factors including higher borrowing costs and lower results on returned lease assets.
- 6The company continues to pay regular cash dividends and has an ongoing stock repurchase program.
- 7Outlook for 2017 anticipates a decline in U.S. and Canadian truck sales but growth in European parts sales.