Rush Enterprises, Inc. · NASDAQ:RUSHA
Rush Enterprises — Rush Enterprises Inc \tx\ — Investor Presentation (October 2015)
28 slides from Rush Enterprises's investor presentation, Oct 30, 2015
Slide 1: Rush Enterprises
aN ENTERPRISES October 30, 2015
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 * 7,041 dedicated employees ° $4.7 billion in revenue in 2014 ¢ 35,352 trucks sold in 2014 °4.9-7.1% U.S. Class 4-8 market share in 2014 «Aand B common shares due to voting control requirements included in Peterbilt de
Slide 4: Commercial Vehicle Market
Commercial Vehicle Market « Fleet age will continue to drive strong aftermarket sales * Automotive strong; commercial and residential construction continues to improve ¢ Vocational markets drive need for aftermarket solutions (upfitting, mobile service, modifications) * Alternative fuel vehicles gro
Slide 5: US Truck Retail Sales
US Truck Retail Sales 350 Units ($000s) @ Class 8 Class 4-7 300 @ Class 250 200 150 100 ACT Research 2004 «2005 =2006 2007 + 2008 2009 2010 2011 2012 2013 2014 2015E 50
Slide 6: Rush Truck Centers
Rush Truck Centers * Largest commercial vehicle dealer group in North America * 121 locations in 21 states ¢ Broad market segment coverage * Peterbilt and Navistar divisions * Medium-duty operates within both divisions * Leasing and rental + Financial and insurance services ¢ Over 5 million square f
Slide 7: Peterbilt Division
Peterbilt Division
Slide 8: Navistar Division
Slide 9: Rush Truck Centers Network
Rush Truck Centers Network
Slide 10: Solutions Network
Solutions Network * 121 Rush Truck Centers locations support all Rush businesses * Capabilities for all makes and models + Aftermarket parts — $220 million parts inventory — Proprietary Rig Tough truck parts — RushCare Rapid Parts call centers * Service and body shop — 2,349 service bays; 2,466 tech
Slide 11: Natural Gas Sales and Service
Natural Gas Sales and Service « Expected 10% of US Class 8 market by 2018, according to ACT Research « Rush sales — 4,261 units since 2005 (622 YTD) * Sales support — Green consultant — Sales specialists « Parts and service support — Natural gas operations manager — 24 dedicated CNG locations, 4 add
Slide 12: Momentum Fuel Technologies
Momentum Fuel Technologies ¢ Innovative design and manufacturing capabilities « Advanced safety features « Installation expertise « Nationwide service network « In production * Two configurations with additional in development U.S. CLASS 8 NATURAL GAS ADOPTION RATES %US Class 8 Sales a Units (000) 5
Slide 13: Absorption Performance
Absorption Performance * Critical metric for dealership efficiency 00 ABSORPTION RATIO* * Measures less cyclical gross profit 118 sy) compared to controllable expenses « Above 95% in down cycle due to efficient expense management 100 |—gg + Entered up cycle at 106%; 92% in 2003 * Q3 2014 record 120.
Slide 14: Quality of Earnings
Quality of Earnings 2009 Class 8 Units 97,000 224,000 2014GP Margin Truck Sales 6.9% | Parts/Service 36.0% | Rental and Leasing 13.9% Parts and Service m Truck Sales = Other m Leasing and Rental
Slide 15: Rush Annual Truck Sales
Rush Annual Truck Sales 2010 2011 2012 2013 2014 2015E m Used m Light-duty = Medium—duty Class 8
Slide 16: Commercial Vehicle Franchises
Commercial Vehicle Franchises Peterbilt, Class 6-8 - 51 locations, 10 states International, Class 5-8 - 59 locations, 10 states Isuzu, Class 4-5 - 31 locations, 10 states Hino, Class 5-7 — 31 locations, 10 states Ford, Class 3-7 — 6 locations, 6 states Mitsubishi Fuso, Class 4-5 — 5 locations, 3 sta
Slide 17: Rush Class 8 Customers
Rush Class 8 Customers Rush 2014 US Class 8 market share - 7.1% en * Strong vocational component ple + Large fleets consolidating * Private mid-size fleets remain viable * Independent owner-operator now variable component of truckload carrier MID-SIZE FLEETS 15-20% = = osHRDSH FR, CIRRERS : pict = M
Slide 18: Rush Class 4-7 Customers
Rush Class 4-7 Customers Rush 2014 US Class 4-7 market share — 4.9% + Vocational and specialty markets cree ara + Ready to roll inventory 10% + National fleet accounts + Market tied closely to the general economy OWING! RECOVERY 10% expect more.
Slide 19: Rush Truck Leasing
Rush Truck Leasing + Full service leasing and rental + Lease trucks captive source for parts and service revenue « PacLease and Idealease franchises * 74 locations including LEASING AND RENTAL REVENUE 12 captive shops $ Millions $200- ¢ 7,680 truck fleet; 1,155 units under contract maintenance * Gro
Slide 20: Strategic Growth Initiatives
Strategic Growth Initiatives + 2020 financial goals — $7 billion in annual revenue - 4% pretax profit margin * Growth opportunities — Increase same store US parts market share from 4% to 6% — Expand vehicle technology and customer service solutions — Increase CNG fuel systems market share to 30% wit
Slide 21: Company at a Glance
Company at a Glance Rush Truck Centers Rush Refuse Systems Rush Crane Systems Rush Towing Systems Rush Bus Centers Rush Truck Financing Rush Truck Leasing Rush Truck Insurance Services Perfection Truck Parts and Equipment Rig Tough Truck Parts Rig Tough Used Trucks Momentum Fuel Technologies Custom
Slide 22: Historical Results
Historical Results $in millions, except 9 months 9 months pecsare arcu! 20102011 2012 2013-2014 ended 9/30/2014 ended 9/30/2015 Revenue $1,4979 $2,580.6 $3,0906 $3,3847 $4,727.4 $3,382.2 $3,817.9 Gross Profit $2849 $4233 $5008 $5720 $756.0 $558.0 $609.3 Gross Profit Margin 19.0% 16.4% 16.2% 16.9% 16
Slide 23: Adjusted Return on Invested Capital
Adjusted Return on Invested Capital $in thousands 2011 2012 2013 2014 9/30/2014 9/30/2015 Total debt $532,141 $894,534 $984,157 $1,121,897 $1,487,641 $1,318,089 $1,587,322 Adjustments Debtrelatedtolease (¢181,022) ($233624) ($322,913) ($443,066) ($539.426) ($490,525) ($586,184) Free te ($237,810) ($
Slide 24: Free Cash Flow
Free Cash Flow 12 months ended 9/30/2015 $99,791 ; 42. month $ in thousands 2010 2011 2012 2013 2014 ended 9/30/2014 $184,277 Netcash provided by $66,433 ($81,369) $219,336 $173.48 $88,937 Acguisiion of nent (884,303) (6148.543) ($170,951) ($191,584) ($260,820) ($250,521) ($328,867) Free cash flow (
Slide 25: Rush Enterprises
aN ENTERPRISES October 30, 2015
Slide 26: Appendix
Appendix This presentation contains certain Non-GAAP financial measures as defined under SEC tules, such as Absorption Ratio, Adjusted EBITDA, Adjusted EBIT, Adjusted EBIT Margin, Adjusted Net Income, Adjusted EPS, Adjusted Total Debt, Adjusted Net Debt, Invested Capital, Adjusted Return on Invested
Slide 27: Appendix Reconciliation adjusted net income and EPS
Appendix Reconciliation adusted net income and EPS In thousands, exceptper 9949 2011 2012 2013 2014 Q9monthsended 9 months ended share amounts 9/30/2014 9/30/2015 Net Income $31,282 $55,213 $62,455 $49,217 $79,957 $55,330 $56,240 Adjustments ea Operations ($6,715) W. Marvin Rush retirement pal ment
Slide 28: Appendix Reconciliation adjusted EBITDA and EBIT
Appendix Reconciliation adusted E8170 and ESIT $ in thousands 210 20112012203 2014 angus anger ets ots AdjustedNetIncome* $24.567 $55,213 $62,455 $55,791 $82,040 $55,330 $56,240 noone ruses S11737 $34,964 $38,728 $36,047 $50,586 $35,003 $36,572 Interest expense $5363 $7,161 $13017 $10,693 $11,198 $8
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