Paccar Inc.'s (PCAR) first-quarter earnings surged 69% as the
heavy-duty truck maker posted sharply higher truck sales revenue in
the U.S. and Canada, as well as growth at its financial services
unit.
Paccar is the second-largest seller of heavy-duty trucks in
North America, behind Daimler AG's (DDAIY, DAI.XE) Freightliner
brand. The maker of Kenworth and Peterbilt commercial trucks has
seen its profits surge in recent quarters, though Paccar aimed to
scale back production in Europe, where it sells DAF brand trucks,
and had cut its 2012 sales forecast for the region due to continued
economic uncertainty.
Paccar recently unveiled plans to cut 10% of its workforce at an
Ohio plant in response to weakening orders for its Kenworth
trucks.
In the latest period, revenue in the U.S. and Canada soared 84%,
offsetting a revenue decline of 5.8% in Europe.
Eaton Corp. (ETN) Chairman and Chief Executive Alexander Cutler,
whose company is a major supplier of transmissions to the truck
market, on Monday dismissed analysts' recent assessments that the
North American truck market has stalled after three straight months
of lower year-over-year orders. Rising fuel costs, scattered
reports of cancelled orders and factory production cuts have added
to the bearish outlook for the truck industry.
Paccar reported a profit of $327.3 million, or 91 cents a share,
up from $193.3 million, or 53 cents a share, a year earlier.
Revenue surged 48% to $4.51 billion. Analysts polled by Thomson
Reuters most recently projected earnings of 78 cents on revenue of
$4.11 billion.
Gross margin edged down to 13.2% from 13.4%.
Its financial services business reported revenue grew 20% to
$261.4 million, while segment income was up 42% at $71.3
million.
Shares closed Monday at $41.95 and were inactive premarket. The
stock is down 21% in the past year, trailing the broader
market.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com