Business Operations - Rush Enterprises operates over 125 franchised Rush Truck Centers across 23 states and Ontario, Canada[27]. - The company increased its equity interest in Rush Truck Centres of Canada Limited to 80% as of May 2, 2022, consolidating its operating results[27]. - The business strategy focuses on providing integrated solutions to the commercial vehicle industry, including sales, service, parts, and financial services[28]. - Rush Truck Centers offer a range of commercial vehicle franchises, including Peterbilt, International, Hino, and Ford, among others[26]. - The company aims to expand its dealership network through strategic acquisitions and new dealership openings[28]. - Rush Truck Centers provide aftermarket parts sales, service and repair facilities, financing, leasing, rental, and insurance products[26]. - The company has a joint venture with Cummins to offer CNG fuel systems and vehicle telematics products[28]. - The locations of Rush Truck Centers are strategically positioned in high traffic areas to better serve commercial vehicle customers[27]. - The company emphasizes reinforcing customer loyalty and maintaining market leadership through its integrated service offerings[28]. - Rush Enterprises has a comprehensive network of parts, service, and collision repair operations across its locations[29]. Financial Performance - Total revenues for 2022 were approximately $7,086.5 million, with new commercial vehicle sales accounting for $3,798.5 million, or 53.5% of total revenues[47]. - Aftermarket Products and Services generated revenues of approximately $2,372.4 million, representing 33.4% of total revenues and 61.7% of gross profit for 2022[44]. - Vehicle leasing and rental revenues amounted to approximately $322.3 million, or 4.5% of total revenues, with a fleet of 9,957 commercial vehicles as of December 31, 2022[51]. - Used commercial vehicle sales contributed approximately $552.9 million, or 7.8% of total revenues for 2022[50]. - The sale of financial and insurance products accounted for approximately $29.7 million, or 0.4% of total revenues, with minimal direct costs contributing to operating profits[52]. - Warranty-related parts and service revenues were approximately $135.0 million, or 1.9% of total revenues for 2022[45]. - New Class 8 heavy-duty truck sales accounted for approximately $2,715.3 million, or 38.2% of total revenues for 2022[47]. - Total revenues for 2022 reached $7,101.7 million, a 38.5% increase from $5,126.1 million in 2021[196]. - Gross profit for 2022 was $1,487.2 million, a 36.1% increase from $1,092.3 million in 2021, with a gross profit margin of 20.9%[196]. - Revenues from sales of new and used commercial vehicles increased by $1,311.4 million, or 43.1%, in 2022 compared to 2021[219]. Employee and Workforce - The company employed 7,418 people in the U.S. and 621 in Canada as of December 31, 2022, with less than 1.3% classified as part-time[55]. - In 2022, the overall employee turnover rate was 30.38%, an increase from 27.49% in 2021, while the turnover rate for service and body shop technicians was 38.7%, up from 36.67% in 2021[69]. - The company established a minimum hourly wage of $15.00 in 2020, ensuring fair pay for employees[61]. - The employee stock purchase plan offers a 15% discount on the purchase price of the company's Class A common stock[63]. - The Rush Foundational Leader Program focuses on developing management and leadership skills across the organization[65]. Market and Sales - The company maintains a diverse customer base, with no single customer accounting for more than 10% of sales by dollar volume in 2022[72]. - The backlog of commercial vehicle orders increased to approximately $4,216.0 million on December 31, 2022, up from $3,267.0 million on December 31, 2021, primarily due to the Summit acquisition and production constraints[98]. - The company anticipates selling approximately 15,300 to 16,500 new Class 8 trucks in 2023, based on a market share of 6.0% to 6.5%[194]. - New U.S. Class 4 through 7 commercial vehicle retail sales are projected to increase by 8.5% in 2023, totaling 253,600 units[195]. - The market share for new U.S. Class 8 commercial vehicle sales increased to approximately 6.3% in 2022 from 4.9% in 2021[220]. Acquisitions and Investments - The company acquired an additional 30% equity interest in RTC Canada for approximately $20.0 million on May 2, 2022, consolidating its operating results[79]. - The acquisition of Summit Truck Group in December 2021 included a purchase price of approximately $205.3 million for full-service commercial vehicle dealerships[80]. - The company completed the acquisition of an additional 30% equity interest in RTC Canada, now holding an 80% controlling interest[196]. Risks and Challenges - The company is subject to various environmental regulations that may impact operational costs and demand for products[99]. - The company is dependent on PACCAR for the supply of Peterbilt trucks and parts, which generate the majority of its revenues[108]. - The dealership agreements with Peterbilt and Navistar are non-exclusive and have terms expiring between May 2023 and December 2027, requiring renewal negotiations[116][115]. - Changes in interest rates could negatively affect profitability, as the company's financing agreements are subject to variable interest rates[130]. - The ongoing COVID-19 pandemic may disrupt workforce availability and supply chains, impacting the company's financial performance[124][125]. - The company faces risks related to natural disasters and severe weather events, which could disrupt operations and increase insurance costs[128]. - Cybersecurity threats, including malware and ransomware attacks, pose risks to the company's information technology systems, which could lead to significant additional costs if breaches occur[146][147]. Shareholder and Stock Information - The company declared a total of $0.80 per share in cash dividends for 2022, with quarterly dividends of $0.19 in Q1 and Q2, and $0.21 in Q3 and Q4[171]. - The previous stock repurchase program authorized the repurchase of up to $100 million, with $93.1 million utilized before its termination on December 1, 2022[177]. - A new stock repurchase program was announced on December 2, 2022, authorizing the repurchase of up to $150 million of shares[177]. - The cumulative total return of the company's common stock was 175.28 as of December 31, 2022, compared to 156.89 for the S&P 500 index[182].
Rush Enterprises(RUSHB) - 2022 Q4 - Annual Report