Paccar 3Q profit plunges 96 pct on sales slump

Paccar posts steep drop in 3rd-quarter profit on continued slump in shipping industry

• On 10:31 am EDT, Tuesday October 27, 2009

BELLEVUE, Wash. (AP) -- Commercial truck maker Paccar Inc. said Tuesday its third-quarter profit plunged 96 percent, citing the effects of the down economy on the shipping industry and truck purchases.

Truck companies have struggled in recent quarters, as tough economic conditions have cut into freight shipments and prompted many trucking companies to continue to put off purchases of new trucks.

Though Paccar showed a profit of $13 million, or 4 cents per share, results fell precipitously from the $299 million, or 82 cents per share, it posted in the same quarter last year.

Sales dropped by more than half to $1.76 billion from $3.68 billion.

Despite the huge drop, the company's profit beat Wall Street predictions. Analysts polled by Thomson Reuters expected a profit of 2 cents per share on $1.78 billion in revenue.

The recent quarter's results included a net gain of $9 million related to the permanent closure of the company's Peterbilt facility in Madison, Tenn.

The company said it expects industrywide U.S. and Canadian sales of Class 8 vehicles, the largest commercial vehicles, to total between 100,000 and 110,000 this year as a result of continued economic weakness, before improving to a range of 110,000 to 140,000 units in 2010.

Paccar shares dropped $1.05, or 2.7 percent, to $38.20 in early trading.

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