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North American truck dealer Rush Enterprises Inc. reported a jump in third quarter net income and slightly higher sales as demand for trucks, services and parts from spare was increasing.
For the period ended September 30, Rush reported net income of $ 69.4 million, or $ 1.20 per diluted share, from $ 33.9 million, 60 cents, a year earlier.
The turnover reached 1.27 billion dollars against 1.18 billion dollars in the period 2020.
âWe continue to see an economic recovery and a strong freight environment across the country, which has created widespread demand for new and used trucks, as well as aftermarket products and services. Our profitability was largely driven by our diligent management of expenses during the quarter, âsaid Chairman and CEO WMâ Rusty âRush during the earnings call.
Aftermarket products and services accounted for 64.5% of the company’s total gross profits in the quarter, with parts, services and collision center revenues totaling $ 463 million, up 15.7 million % from the third quarter of 2020.
The company achieved a record quarterly absorption rate of 134% in the third quarter of 2021, up from 119.4% in the third quarter of 2020.
Rush calculates the absorption rate by dividing the gross profit of the parts, service, and body departments by the overhead costs of all departments in a dealership except the selling expenses of the new commercial vehicle departments. and second-hand and the costs of owning new and used commercial vehicles. vehicle inventory.
âService revenues continued to improve gradually during the third quarter, which we attribute in large part to an increase in hiring of technicians and an improvement in the skills of our technicians. Our service revenues were also positively impacted in the third quarter by our improved service communication technologies, our mobile service offerings, Xpress services and contract maintenance offerings, âsaid Rush.
Additionally, on September 7, the company entered into an agreement with subsidiaries of The Summit Truck Group to acquire full-service truck dealers in Arkansas, Kansas, Mississippi, Missouri, Oklahoma, Tennessee. and Texas.
âThe Summit agreement represents good growth for us,â said Rush. âWhen you look at it, it’s the second largest international dealership, okay? “
The acquisition includes dealers representing International, IC Bus, Idealease, Isuzu and other commercial vehicle manufacturers. It is expected to close in December, the San Antonio-based company reported.
The company has acquired an independent parts and service facility in Victorville, Calif. Which will be converted into a full-service dealership Peterbilt Motors Co. Rush also plans to acquire a full-service Hino and Isuzu dealership in Elk Grove, in Illinois in November 2021.
Rush also expects to complete the previously announced agreement for Cummins Inc. to acquire a 50% interest in Momentum Fuel Technologies during the fourth quarter of 2021. The joint venture will produce Cummins-branded natural gas distribution systems for the commercial vehicle market in North America and will provide aftermarket support through Rush Truck Centers and Cummins distributors, who will be able to service both the engine and the fuel system.
In this episode, host Michael Freeze asks how do businesses save money by renting trucks rather than owning them? To get answers, we chat with Jim Lager of Penske Truck Leasing and Al Barner about strategic fleet solutions at Fleet Advantage. Listen to a sample above and get the full schedule by heading over to RoadSigns.TTNews.com.
Looking ahead, Rush said, âI think some of the requirements when we talk about electricity, hydrogen and fuel cell and all the other good things, governments had better be careful about pushing too hard because that we have to catch up with what we want. I know we have to clean things up, but those kinds of things will be opportunities that I don’t see at the moment, but I’m very comfortable with the truck manufacturers that I ‘ai, who are participating in this transition.
He called this time âa decade of transition like never before. The transition creates a bit of confusion, which creates opportunities; believe me, we are ready.
The company sells trucks from Peterbilt Motors Co., a brand of Paccar Inc .; the international brand of Navistar Inc., a subsidiary of Traton SE; Hino Trucks, a Toyota group company; Isuzu Commercial Truck of America Inc .; and Ford Motor Co.
Rush is the largest commercial vehicle dealer network in North America with over 100 dealerships in 22 states.
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