Rush Enterprises, Inc. · NASDAQ:RUSHA
Rush Enterprises — Rush Enterprises Inc \tx\ — Investor Presentation (May 2014)
28 slides from Rush Enterprises's investor presentation, May 20, 2014
Slide 1: May 20, 2014 - expect more.
Mey 20,2014 expect more.
Slide 2: Disclosure / Safe Harbour
Disclosure /Safe Harbour 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 result
Slide 3: Full service solutions provider to commercial equipment industry
Full service solutions provider to commercial equipment industry 6,000 dedicated employees $3.4 billion in revenues in 2013 26 336 trucks sold in 2013 $40 million share repurchase authorization Aand Bcommon shares due to control requirements established upon IPO
Slide 4: Fleet age will continue to drive strong aftermarket sales
= Fleet age will continue to drive strong aftermarket sales = Automotive strong, housing recovery underway = Vocational markets dive need for aftermarket solutions (Upfitting, mobile service, modifications) = Altemate fuel vehicles growing opportunity — up to 10% of market by 2017 = Reemergence of l
Slide 5: U.S. Truck Retail Sales
U.S. Truck Retail Sales Units (00's) 360 300 250 200 > g 150 S 100 AGT Research 50 2004 2005 2008 2007 2008 «2009 2010 2011 2012 2013 2014 os EEE ER ot ESE NT
Slide 6: Largest commercial vehicle dealer group in North America
Largest commercial vehicle dealer group in North America 106 locations in 20 states Broad market segment coverage Peterbilt and Navistar divisions Medium-duty operates within both divisions Leasing and rental Financial and insurance services Over 2 million sq. ft. of prernium facilities
Slide 7: Peterbilt Division
Peterbilt Division
Slide 8: Navistar Division
Navistar Division
Slide 9: Rush Truck Centers Network
Rush Truck Centers Network
Slide 10: Locations support all Rush businesses
106 locations support all Rush businesses Capabilities for all makes and models S $160 milion parts inventory Proprietary Rig Tough truck parts VICE AND BODY SHOP 1,897 service bays; 2,199 technicians Complete range of solutions from outsourced maintenance to basic PM 280 mobile service units 125 te
Slide 11: Expected 8-10% of industry by 2017
= Expected 8-10% of industry by 2017 = Rush sales — 2,900 units since 2005 (924 in 2013, 281 YTD) = Sales support + Natural Gas Sales Manager + Natural Gas Operations Manager + Green Consultant + Sales Specialist = Parts and Service Support + Dedicated operations 7 locations, 10 underway + Allnew fa
Slide 12: Partnership with 3M
Partnership with 3M 3M + Advanced proprietary materials and tank technology + Lean manufacturing expertise Rush Enterprises + Design, manufacturing and installation + Sales and distribution + Warranty and service support Spring 2015
Slide 13: Absorption Performance
Absorption Performance ABSORPTION RATIO" Critical metric for dealership efficiency +14_US = Measures less cyclical gross profit compared to controllable expenses * Maintained above 95% in down cycle — expense management = Entered up cycle at 106%; 92% in 2003 Percent 0 Year 3 45 6 7 8 9 1011 2 13 ME
Slide 14: Quality of Earnings
Quality of Earnings Percentage 100 80 60 | 40 oe 64.4% 52.5% 20 Peak [P Trough 4 6 z 2006 2009 2013 PaitsandSenice mw Truck Sales other Leasing and Rental Class 8 Units 290,000 97,000 488,000 2013E GP Margin Tuck Sales 6.5% to 75% | Parls/Service 35-38% | Rental and Leasing 14to 16%
Slide 15: Rush Annual Truck Sales
Rush Annual Truck Sales Trucks 28,000 24,000 20,000 16,000 12,000 8,000 4,000 8.416 9,100 5469 7126 4,649 I 4,744 | 6405) 7,500 2009 2010 2011 2012 2013 2014E Used might Duty Medium Duty mi Class 8 0
Slide 16: Brands and locations by state
Peterbilt, Class 6-8 International, Class 5-8 Isuzu, Class 45 Hino, Class 5-7 Ford, Class 3-7 Mitsubishi Fuso, Class 4-5 IC Bus Blue Bird Elkhart Collins Jere-Dan PacLease Idealease —47 locations, 10 states 48 locations, 10 states 30 locations, 10 states 24 locations, 7 states - 6 locations, 6 state
Slide 17: Rush Class 8 Customers
Rush Class 8 Customers aan RUSH U.S. CLASS 8 45.50% MARKET SHARE - 5.5%- 6.5% P = Strong vocational component = Large fleets consolidating = Private mid-size fleets remain viable| = Independent Owner-Operator now variable component of truckload carrier \ MARTEN PRE @ Puss oskbsH yy ag Aeamex Schlumb
Slide 18: Rush Class 4-7 Customers
Rush Class 4-7 Customers RUSH MEDIUM-DUTY MARKET SHARE - 4.5%- 5.5% = Vocational and specialty markets = Ready to roll inventory = National fleet accounts = Market tied closely to the general economy brighthouse (©) YERDAN =MASCO BSPROBUIId Ee <-> Mf canteen
Slide 19: Leasing and Rental Revenue
LEASINGAND RENTAL REVENUE $ Mllions $185 $165 nas $125 $105 $35 $65 $45 2 $52 $55 $54 | 2007 2008 2009 2010 2011 2012 2013 2014E Full service leasing and rental Lease trucks captive source for parts and service revenue PacLease and Idealease franchises 61 locations including 10 captive shops 6,303 t
Slide 20: Objectives
= Provide comprehensive solutions and premier service to cornmmercial equipment industry = Expand scope of commercial equipment product offerings = Enhance value of Rush brand = Grow to $5 billion in revenue with 20% average ROIC OBJECTIVES = Expand network = Extend breadth of product and service of
Slide 21: Company at a Glance
or ompany at a Glance Ruish Truck Centers Rush Refuse Systems Rush Crane Systeris Ruish Towing Systerns. Rush Bus Certers, Ruish Truck Financitg Rush Truck Leasing Rush Truck Insuratioe Perfection Equipment Rig Tough Truck Parts Rig Tough Used Trucks Custorn Vehicle Solutiofts Chrome Country ‘World
Slide 22: Historical Results
Historical Results 3 months ended Peidilediach MEE) amo an 2012 ama Rts tM Revenue $1,205 $1,4979 42,5806 $3,0906 © $3,3847 $75680 $958.70 Gross Profit $2156 $2849 $233 $5008 = $5720 $133.80 $1659 180% 190% 164% 162% «= 16.9% © 17.7% «= 173%. Adjusted EBIT(I)* «$130 $426 = $930 $105.6 = $954 $23.10
Slide 23: Adjusted Return on Invested Capital
Adjusted Return on Invested Capital inthousands 2009 2010 2011 2012 2013 3I31N331N4 Total debt $495,202 $532,141 ga94534 $904,187 $1,121,897 9954920 $1,224368, Adjustments Debtrebtedtolease igraypng) egne2) (239824) ($2913) (SH NBH) (SDT) HERAT) Leto 6189256) (237.810) (A820,893) (6594520) (9598 849
Slide 24: Free Cash Flow
Free Cash Flow thousands Er 213 3BIM3 38H Net cash provided by sed bp $1508 EA OTH] IVI «SIT SmETN—§103327 operations seoeieencpment — 5,485) (84303) (918,543) @rTOaSI) (erat seq —C63.ATO) 214617) Free cash flow 89810 GITAT LA.812) GHB 38S IBN) «$243.50 105,280) Adjustments Drase (payments) ce 993,4
Slide 25: May 20, 2014 - expect more.
Moy 20,2014 expect more.
Slide 26: Appendix
Appendix This presentation contains certain Non-GAAP financial measures as defined under SEC rules, such as Absorption Retio, Adusted EBITDA, Adjusted EBIT, Adusted EBIT Margin, Adjusted Net Income, Adjusted EPS, Adjusted Total Debt, Adjusted Net Debt, Invested Capital, Adjusted Return on Invested C
Slide 27: Appendix: Reconciliation adjusted EBITDA and EBIT
Appendix Reconciliation — adjusted EBITDA and BBIT 3 months ended $n thousand 2009 010 att amas Adjusted Net Income’ $925. GUASHT. $5213 HASH SUST | 35MT 1214 Laila nd (200s) 911737 934984 938,728 SUR NMT 8583 STANT Interest expense $569 $5308 $7,161 SIRT gpm ata 83,131 Devreeliden and $15,890 $15,7
Slide 28: Appendix: Reconciliation Adjusted Net Income and EPS
Appendix Reconciliation Adjusted Net Income and EPS 3 months ended FT | a CC TD per share amounts Net Income $88 182 $528 gS ITT asa ZT Adjustments Income from Discontinued 709) 86,715) Opentions GHC franchise termnation,netoftax 91830 1. Marvin Rush retirement payment so o04 decrual net oft Adjuste
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