Paccar (PCAR) Q4 2016 earnings summary

Executive summary

• FY2016 revenue was $17.033B; GAAP net income was $521.7M, including an $833.0M non-recurring European Commission charge; adjusted net income was $1,354.7M.

• Q4 revenue was $4.071B and net income was $288.8M, or $0.82 diluted EPS.

• Net income was achieved for the 78th consecutive year; European deliveries and market share gains, Parts and Financial Services supported results amid weaker North American demand.

Financial highlights

• Q4 revenue was $4.071B versus $4.355B in Q4 2015; net income was $288.8M versus $347.2M.

• FY revenue was $17.033B versus $19.115B in 2015; GAAP net income was $521.7M versus $1.604B.

• FY adjusted diluted EPS was $3.85 versus GAAP diluted EPS of $1.48; 2015 diluted EPS was $4.51.

• Cash from operations was $2.30B; cash and marketable securities were $2.923B at year-end 2016.

Outlook and guidance

• 2017 U.S./Canada Class 8 market forecast: 190,000–220,000 trucks; Europe above-16-tonne market forecast: 260,000–290,000.

• 2017 gross margin outlook was 13.5%–14.5%; parts revenue growth forecast was 2%–4%.

• 2017 R&D spending planned at $250M–$280M and capital expenditures at $375M–$425M.

• Mexico truck market forecast at 20,000–25,000 units; U.S./Canada medium-duty market expected to be fairly flat.

• Global heavy-truck markets above 6 tonnes were estimated at 2.7M units in 2016 and forecast at 2.8M in 2021.