Rush Enterprises, Inc. · NASDAQ:RUSHA
Rush Enterprises — Rush Enterprises Inc \tx\ — Investor Presentation (May 2021)
26 slides from Rush Enterprises's investor presentation, May 20, 2021
Slide 1: Rush Enterprises – May 2021
Slide 2: Disclosure/Safe Harbor
DISCLOSURE/SAFE HARBOR This presentation may contain forward-looking statements (as defined in the Private Securities Litigation Reform Act 1995). Any forward-looking statements are based on current expectations with respect to important risk factors. It is important to note that our actual results
Slide 3: Company Overview
COMPANY OVERVIEW + Full-service solutions provider to commercial vehicle industry + 6,347 dedicated employees + $4.7B in revenue in 2020 30,513 trucks sold in 2020 5.5% U.S. Class 8 market share in 2020 4.9% U.S. Class 4-7 market share in 2020 Aftermarket revenues account for 66.7% of company gross
Slide 4: Company at a Glance
COMPANY AT A GLANCE Rush Truck Centers Rush Truck Leasing Rush Refuse Systems Rush Truck Insurance Rush Crane Systems House of Trucks Rush Towing Systems Momentum Fuel Technologies Rush Bus Centers Custom Vehicle Solutions Perfection Truck Parts & Equipment Chrome Country World Wide Tires expect Pax
Slide 5: Economic Outlook and Commercial Vehicle Market
ECONOMIC OUTLOOK AND COMMERCIAL VEHICLE MARKET * General economic industry conditions have improved Pe tl — Consumer spending expected to remain strong — Truck manufacturers increasing capacity = 4 — Supply chain issues may impact new commercial tom vehicle and parts availability in 2021 + Class 8 a
Slide 6: Liquidity and Expense Management
LIQUIDITY AND EXPENSE MANAGEMENT * Strong free cash flow; $316.1M in cash as of March 2021 * $100M line of credit, no outstanding draws * Continuing to invest in strategic initiatives + Authorized $100M share repurchase program in December, 2020 and increased dividend in Q3 2020 and Q1 2021 + Discip
Slide 7: U.S. Retail Truck Sales Projections to 2025
U.S. RETAIL TRUCK SALES PROJECTIONS TO 2025 300 250 200 ya Units (Thousands) a s 2011 «2012 «2013 2014 «2015 §=2016 §=2017 +2018 2019 2020 2021E 2022E 2023E 2024E 2025E 174 | 199 | 188 | 224 | 253 | 197 | 197 | 256 | 281 | 196 | 248 | 284 | 262 | 186 | 236 Class 47 | 146 | 164 | 180 | 200 | 218 | 22
Slide 8: Strategic Growth Initiatives
STRATEGIC GROWTH INITIATIVES * Financial goals — $78 in annual revenue — 5% pre-tax profit margin * Growth goals and opportunities Grow parts revenue to $2B Grow service and collision center revenue to $600M Increase US. Class 8 market share to 7.5% Increase U.S. Class 4-7 market share to 6.5% Incre
Slide 9: Rush Truck Centers
RUSH TRUCK CENTERS + Largest commercial vehicle dealer group in North America * 119 locations in 21 states * 50% ownership of Rush Truck Centres of Canada, 14 International locations in Ontario * Class 3-8 commercial vehicle sales, full range of aftermarket solutions * Broad market segment coverage
Slide 10: Dealership Locations Map
@ Peterbilt Dealerships @ -riematonal Dealerships \ F @ IndependentParts and Service Locations t va . expect @ Rush Truck Centres Canada \ee \I more.
Slide 11: Solutions Network
SOLUTIONS NETWORK * Capabilities for all makes and models * Aftermarket parts = Over $200M parts inventory — Genuine OEM and all-makes parts including proprietary Rig Tough and Premium Power powertrain parts * Service and body shop — 2,398 service bays, 2,166 technicians; 26 collision centers — 596
Slide 12: Technology and Customer Service Innovation
TECHNOLOGY AND CUSTOMER SERVICE INNOVATION + RushCare Parts Connect + RushCare Service Connect + RushCare Telematics Solutions — Custom fault code monitoring system — OEM/component supplier support * RushCare Rapid Parts and Rapid Service call centers + Nationwide call center and dedicated service c
Slide 13: Absorption Performance
ABSORPTION PERFORMANCE * Critical metric for dealership efficiency ABSORPTION RATIO* 130% + Measures less cyclical gross profit compared to controllable expenses 116% stay, WOM 116% 114mm HO 114% : 110% * 118.7% overall in 2020 * 132.9% in Q4 2020 90% 70% 50% 2009 2010 2011 2012 2013 2014 2015 2016
Slide 14: Quality of Earnings 2020
QUALITY OF EARNINGS 2020 Lease, RentaliFinance, Insurance/Other — 8% ™ Lease, Rental/Finance, Insurance/Other 6%
Slide 15: Rush Enterprises Annual Truck Sales
RUSH ENTERPRISES ANNUAL TRUCK SALES Units (Thousands) 50 40 30 20 10 16.8 108 11.2 114 2015 2017 Light-duty El = Medium-duty 2019 mClass 8 2020 2021E expect Pore.
Slide 16: Vehicle Franchises
VEHICLE FRANCHISES Peterbilt, Class 6-8 - 62 locations, 11 states International, Class 5-8 - 42 locations, 9 states, 50% ownership of 14 locations in Canada Ford, Class 3-7 - 9 locations, 7 states Hino, Class 5-7 - 33 locations, 9 states Isuzu, Class 4-5 — 26 locations, 9 states Blue Bird — 24 locat
Slide 17: Class 8 Customers
CLASS 8 CUSTOMERS Rush Enterprises 2020 U.S. Class 8 market share - 5.5% Strong vocational component Large fleets consolidating Private mid-size fleets remain viable Independent owner-operator now variable component of truckload carrier 0 5.5% Vocational FedEx. Walmart WOE! ne WR rat WERNER — © osme
Slide 18: Class 4-7 Customers
CLASS 4-7 CUSTOMERS + Rush Enterprises 2020 U.S. Class 4-7 market share - 4.9% Vocational and specialty markets Towing! + Ready-to-Roll® Recovery 10% + National fleet accounts + Market tied closely to general economy rex eS 2 oy 4.9% a expect more.
Slide 19: Rush Truck Leasing
RUSH TRUCK LEASING + Full-service leasing and rental LEASING AND RENTAL REVENUE + Lease trucks captive source for 5208 parts and service revenue $250 $238. $236 + PacLease and Idealease franchises 20g S217 + 44 locations including 4 captive shops $200 + 7,985 units in truck fleet, including cranes $
Slide 20: Historical Results
HISTORICAL RESULTS Months | Three Months =u aus ae co ded 3/34/2020 | Ended 3/31/2021 expect more.
Slide 21: Adjusted Return on Invested Capital
ADJUSTED RETURN ON INVESTED CAPITAL $in Thousands P 2018 2019 20: 172021 Tal deb (GAAP) $1473.20 $1693306S1716.384 = $1,158553 S1.597773 $1,175,446 Adjustments: pape ($598,512) ($589,933) ($661,191) ($601,272) ($648,054) ($581,692) Floorplan notes payable (S778.561) —_($1.023019) (8996336) ($511,788
Slide 22: Free Cash Flow
FREE CASH FLOW $in Thousands 2018 238,26 $1567: $1637 $39,268 1 2 1 $2 $2 at st 172, 5 $43.12 47 $36 48 ¥ expect more.
Slide 23: Slide 23
Slide 24: Appendix
APPENDIX This presentation contains certain Non-GAAP financial measures as defined under SEC rules, such as Adjusted EBITDA, Adjusted EBIT, Adjusted EBIT Margin, Adjusted Net Income, Adjusted EPS, Adjusted Total Debt, Adjusted Net Debt, Adjusted Invested Capital, Adjusted Return on Invested Capital,
Slide 25: Appendix Reconciliation: Adjusted Net Income and EPS
APPENDIX RECONCILIATION Adjusted Net Income and EPS Mon Ended 3/34 expect more.
Slide 26: Appendix Reconciliation: Adjusted EBITDA and EBIT
APPENDIX RECONCILIATION Adjusted EBITDA and EBIT nths hree Months 31/2020 | Ended 3/31/2021 Net Income ‘Adjusted Net Income” Provision for income Taxes Interest expense Depreciaton and amortization ‘Asset impairmenicharge,netoftax (Gain) Loss on sales of assets EBITDA" Adjustments: frase ‘Adjusted E
Rush Enterprises Inc \tx\ — Investor Presentation (May 2021) on 6ix