Rush Enterprises Inc (RUSHB) has reported a 27.28 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $12.49 million, or $0.31 a share in the quarter, compared with $9.81 million, or $0.24 a share for the same period last year.
Revenue during the quarter dropped 12.10 percent to $1,021.27 million from $1,161.82 million in the previous year period. Gross margin for the quarter expanded 181 basis points over the previous year period to 16.93 percent. Total expenses were 97.71 percent of quarterly revenues, down from 98.33 percent for the same period last year. This has led to an improvement of 62 basis points in operating margin to 2.29 percent.
Operating income for the quarter was $23.39 million, compared with $19.36 million in the previous year period.
“New heavy-duty truck sales were off significantly in 2016, as several of our large fleet customers delayed purchases due to excess capacity, an erratic freight environment and low used truck trade-in valuations caused by an oversupply of used trucks,” said W.M. “Rusty” Rush, chairman, chief executive officer and president, Rush Enterprises, Inc. “However, our solid performance in medium-duty new truck sales was a bright spot for the year,” Rush added.
Working capital increases sharply
Rush Enterprises Inc has recorded an increase in the working capital over the last year. It stood at $118.32 million as at Dec. 31, 2016, up 48.74 percent or $38.77 million from $79.55 million on Dec. 31, 2015. Current ratio was at 1.12 as on Dec. 31, 2016, up from 1.06 on Dec. 31, 2015.
Debt comes down
Rush Enterprises Inc has recorded a decline in total debt over the last one year. It stood at $1,334.66 million as on Dec. 31, 2016, down 15.86 percent or $251.62 million from $1,586.28 million on Dec. 31, 2015. Total debt was 51.27 percent of total assets as on Dec. 31, 2016, compared with 55.62 percent on Dec. 31, 2015. Debt to equity ratio was at 1.55 as on Dec. 31, 2016, down from 1.88 as on Dec. 31, 2015. Interest coverage ratio improved to 7.82 for the quarter from 5.75 for the same period last year.
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