PACCAR Inc Files Q3 2024 10-Q

TL;DR

**PCAR Q3 10-Q FILED: Financials and operations details out.**

AI Summary

PACCAR Inc filed its 10-Q for the period ending September 30, 2024. The filing details financial performance and operations, including information on truck sales, financial services, and stock repurchase plans. Key financial data such as assets, liabilities, and retained earnings are presented for the periods ending September 30, 2024, and September 30, 2023.

Why It Matters

This filing provides investors with crucial financial data for PACCAR Inc, impacting decisions related to truck manufacturing and financial services sectors.

Risk Assessment

Risk Level: low — This is a routine quarterly filing providing standard financial disclosures.

Key Numbers

• 2024-09-30 — Reporting Period End Date (Indicates the latest financial data available.)
• 2023-09-30 — Prior Period End Date (Used for year-over-year financial comparisons.)
• 1231 — Fiscal Year End (Defines the company's annual financial reporting cycle.)

Key Players & Entities

• PACCAR INC (company) — Filer of the 10-Q
• 2024-09-30 (date) — End of reporting period
• 2023-09-30 (date) — Prior period end date for comparison
• Bellevue, WA (location) — Company headquarters location

FAQ

Key Financial Figures

• $1 — nge on Which Registered Common stock, $1 par value PCAR The Nasdaq Stock Mar

Filing Documents

• pcar-20240930.htm (10-Q) — 5166KB
• pcar-ex4_h.htm (EX-4.H) — 468KB
• pcar-ex31_a.htm (EX-31.A) — 19KB
• pcar-ex31_b.htm (EX-31.B) — 19KB
• pcar-ex32.htm (EX-32) — 25KB
• 0000950170-24-118960.txt ( ) — 21892KB
• pcar-20240930.xsd (EX-101.SCH) — 1564KB
• pcar-20240930_htm.xml (XML) — 6239KB

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS: Consolidated Statements of Comprehensive Income – Three and Nine Months Ended September 30, 2024 and 2023 (Unaudited) 3 Consolidated Balance Sheets – September 30, 2024 (Unaudited) and December 31, 2023 4 Condensed Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2024 and 2023 (Unaudited) 6 Consolidated Statements of Stockholders' Equity – Three and Nine Months Ended September 30, 2024 and 2023 (Unaudited) 7

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 8 ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 34 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 52 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 52 PART II. OTHER INFORMATION: ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 53 ITEM 1A.

RISK FACTORS

RISK FACTORS 53 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES 53 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 53 ITEM 4. MINE SAFETY DISCLOSURES 53 ITEM 5. OTHER INFORMATION 53 ITEM 6. EXHIBITS 54 INDEX TO EXHIBITS 54 SIGNATURE 56 - 2 -

– FINANCI AL INFORMATION

PART I – FINANCI AL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS Consolidated Statements of Com prehensive Income (Unaudited) (Millions, Except Per Share Amounts) Three Months Ended Nine Months Ended September 30 September 30 2024 2023 2024 2023 TRUCK, PARTS AND OTHER: Net sales and revenues $ 7,703.8 $ 8,232.3 $ 24,201.1 $ 24,723.7 Cost of sales and revenues 6,427.7 6,626.7 19,873.8 19,971.5 Research and development 115.0 103.5 337.6 302.0 Selling, general and administrative 144.3 143.6 434.6 448.3 Interest and other (income) expenses, net ( 24.3 ) ( 16.3 ) ( 74.9 ) 544.8 6,662.7 6,857.5 20,571.1 21,266.6 Truck, Parts and Other Income Before Income Taxes 1,041.1 1,374.8 3,630.0 3,457.1 FINANCIAL SERVICES: Interest and fees 334.9 269.8 956.3 716.5 Operating lease, rental and other revenues 201.2 194.3 598.9 610.6 Revenues 536.1 464.1 1,555.2 1,327.1 Interest and other borrowing expenses 188.4 138.5 520.9 347.8 Depreciation and other expenses 176.6 146.9 530.5 427.0 Selling, general and administrative 42.2 38.7 122.0 110.9 Provision for losses on receivables 22.4 6.2 50.2 14.1 429.6 330.3 1,223.6 899.8 Financial Services Income Before Income Taxes 106.5 133.8 331.6 427.3 Investment income 108.7 80.8 290.0 192.5 Total Income Before Income Taxes 1,256.3 1,589.4 4,251.6 4,076.9 Income taxes 284.2 360.9 961.6 893.4 Net Income $ 972.1 $ 1,228.5 $ 3,290.0 $ 3,183.5 Net Income Per Share Basic $ 1.85 $ 2.35 $ 6.26 $ 6.08 Diluted $ 1.85 $ 2.34 $ 6.25 $ 6.07 Weighted Average Number of Common Shares Outstanding Basic 525.4 524.1 525.2 523.8 Diluted 526.5 525.3 526.5 524.8 Comprehensive Income $ 1,111.9 $ 1,068.7 $ 3,178.5 $ 3,199.3 See Notes to Consolidated Financial Statements. - 3 - Consolid

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Millions, Except Share Amounts) NOTE A - Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. For further information, refer to the consolidated financial statements and footnotes included in PACCAR Inc's (PACCAR or the Company) Annual Report on Form 10K for the year ended December 31, 2023. Equity Method Investment: The Company uses the equity method to account for the investment in an advanced battery cell manufacturing joint venture. Under the equity method, the original investments in the joint venture are recorded at cost and subsequently adjusted by the Company's share of equity income or losses after the date of acquisition. The investment is included in Truck, Parts and Other "Other noncurrent assets, net" on the Company's Consolidated Balance Sheets as of September 30, 2024 . Earnings per Share : Basic earnings per common share are computed by dividing earnings by the weighted average number of common shares outstanding, plus the effect of any participating securities. Diluted earnings per common share are computed assuming that all potentially dilutive securities are converted into common shares under the treasury stock method. The dilutive and antidilutive options are shown separately in the table below: Three Months Ended

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Millions, Except Share Amounts) The following table disaggregates Truck, Parts and Other revenues by major sources: Three Months Ended Nine Months Ended September 30 September 30 2024 2023 2024 2023 Truck Truck sales $ 5,781.2 $ 6,412.4 $ 18,423.5 $ 19,219.7 Revenues from extended warranties, operating leases and other 245.8 224.0 722.3 658.0 6,027.0 6,636.4 19,145.8 19,877.7 Parts Parts sales 1,605.0 1,533.5 4,844.6 4,660.4 Revenues from dealer services and other 52.6 48.7 153.2 143.7 1,657.6 1,582.2 4,997.8 4,804.1 Winch sales and other 19.2 13.7 57.5 41.9 Truck, Parts and Other sales and revenues $ 7,703.8 $ 8,232.3 $ 24,201.1 $ 24,723.7 The Company recognizes truck and parts sales as revenues when control of the products is transferred to customers which generally occurs upon shipment, except for certain truck sales which are subject to a residual value guarantee (RVG) by the Company. The standard payment term for trucks and aftermarket parts is typically within 30 days, but the Company may grant extended payment terms on selected receivables. The Company recognizes revenue for the invoice amount adjusted for estimated sales incentives and returns. Sales incentives and returns are estimated based on historical experience and are adjusted to current period revenue when the most likely amount of consideration the Company expects to receive changes or becomes fixed. Truck and parts sales include a standard product warranty which is included in cost of sales. The Company has elected to treat delivery services as a fulfillment activity with revenues recognized when the customer obtains control of the product. Delivery revenue is included in revenues and the related costs are included in cost of sales. The Company is not disclosing truck order backlog, as a significant majority of the backlog has

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Millions, Except Share Amounts) Revenues from extended warranties, operating leases and other include optional extended warranty and repair and maintenance (R&M) service contracts which can be purchased for periods generally ranging up to five years . The Company defers revenue based on stand-alone observable selling prices when it receives payments in advance and generally recognizes the revenue on a straight-line basis over the warranty or R&M contract periods. See Note F, Product Support Liabilities, in the Notes to the Consolidated Financial Statements for further information. Also included are truck sales with an RVG accounted for as an operating lease. A liability is created for the residual value obligation with the remainder of the proceeds recorded as deferred revenue. The deferred revenue is recognized on a straight-line basis over the guarantee period, which typically ranges from three to five years . Deferred revenue related to trucks sold with an RVG was $ 17.6 at September 30, 2024. The Company expects to recognize approximately $ 3.5 of the remaining deferred revenue in 2024, $ 7.6 in 2025, $ 4.0 in 2026, $ 1.8 in 2027 and $ .7 in 2028. For the three and nine months ended September 30, 2024, total operating lease revenue from truck sales with RVGs was $ 7.7 and $ 25.6 , respectively, compared to $ 11.7 and $ 47.1 for the three and nine months ended September 30, 2023. The Company's total commitment to acquire trucks at a guaranteed value for contracts accounted for as a lease was $ 78.0 at September 30, 2024. Revenue from winch sales and other is primarily derived from the industrial winch business. Winch sales are recognized when the product is transferred to a customer, which generally occurs upon shipment. Also within this category are other revenues not attributable to a reportable segment. Financial Services The Company's Financial Services segment products include loans to custome

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) (Millions, Except Share Amounts) The following table summarizes Financial Services lease revenues by lease type: Three Months Ended Nine Months Ended September 30 September 30 2024 2023 2024 2023 Finance lease revenues $ 86.4 $ 72.7 $ 253.4 $ 194.1 Operating lease revenues 163.7 180.6 501.2 564.1 Total lease revenues $ 250.1 $ 253.3 $ 754.6 $ 758.2 NOTE C - Investments in Marketable Securities Debt Securities The Company's investments in marketable debt securities are classified as available-for-sale. These investments are stated at fair value and may include an allowance for credit losses. Changes in the allowance for credit losses are recognized in the current period earnings and any unrealized gains or losses, net of tax, are included as a component of accumulated other comprehensive income (loss) (AOCI). The Company utilizes third-party pricing services for all of its marketable debt security valuations. The Company reviews the pricing methodology used by the thirdparty pricing services, including the manner employed to collect market information. On a quarterly basis, the Company also performs review and validation procedures on the pricing information received from the thirdparty providers. These procedures help ensure the fair value information used by the Company is determined in accordance with applicable accounting guidance. The Company evaluates its investment in marketable debt securities at the end of each reporting period to determine if a decline in fair value is the result of credit losses or unrealized losses. In assessing credit losses, the Company considers the collectability of principal and interest payments by monitoring changes to issuers' credit ratings, specific credit events associated with individual issuers as well as the credit ratings of any financial guarantor. The Company considers its intent for selling t