<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 8-K/A
AMENDMENT NO. 2 TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 15, 1996
- -------------------------------------------------------------------------------
PACCAR INC
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-6394 91-0351110
- -------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
777 - 106th Ave. N.E., Bellevue, WA 98004
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (206) 455-7400
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE>
ITEM 2 ACQUISITION OR DISPOSITION OF ASSETS.
(a) On November 15, 1996 PACCAR Inc purchased all outstanding shares of
DAF Trucks N.V. (DAF), a Netherlands corporation. DAF is a vertically-
integrated truck manufacturer, producing its own engines and axles.
Its primary products are cab-over-engine trucks. DAF has factories in
the Netherlands and Belgium, and it is the exclusive distributor in
Europe for medium-duty trucks manufactured by Leyland in the United
Kingdom.
The transaction was denominated in Dutch Guilders (NLG). PACCAR Inc
paid NLG 900 million for all outstanding shares of DAF. As a
precondition to the purchase, DAF was required to purchase a 25%
minority interest in a Belgium subsidiary, DAF Trucks Vlaanderen N.V.,
for NLG 33 million. Sources of the funds used for payment consisted of
NLG 300 million from PACCAR Inc cash reserves with the remaining
balance borrowed under terms of two Dutch Guilder short term notes of
NLG 300 million each. One note is with Bank of America NW, N.A. DBA
Seafirst Bank. The other note is with ABN AMRO Bank N.V.
(b) The acquired assets were used in the development, production,
marketing, sale and after-sale service of medium and heavy commercial
trucks. In addition the acquired assets were used to supply
components, such as axles, engines and cabs, to third parties for use
in the manufacture of buses and coaches, special vehicles, earth-
moving machinery, generator and other heavy industrial machinery.
PACCAR Inc intends to continue to use the assets in the businesses as
described.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Historical Financial Statements of DAF Trucks, N.V., prepared in
accordance with accounting principles generally accepted in the
Netherlands pursuant to Rule 3-05 of Regulation S-X.
FULL YEAR (AUDITED)
- Auditors' report
- Consolidated profit and loss account
for the year ended December 31, 1995
- Consolidated balance sheet
at December 31, 1995
- Consolidated cash flow statement
for the year ended December 31, 1995
- Notes to the accounts
INTERIM PERIOD (UNAUDITED)
- Consolidated profit and loss account
10 Periods Ended October 6, 1996 and September 30, 1995
- Consolidated balance sheet
At October 6, 1996
- Consolidated cash flow statement
10 Periods Ended October 6, 1996 and September 30, 1995
- Notes to the interim accounts
-2-
<PAGE>
(b) Pro Forma Consolidated Financial Information (Unaudited) reflecting
PACCAR Inc acquisition of DAF Trucks, N.V.
- Pro forma condensed consolidated statements of income for the year ended
December 31, 1995 and the nine months ended September 30, 1996
- Pro forma condensed consolidated balance sheet at September 30, 1996
- Notes to pro forma condensed consolidated financial information
(c) Exhibits. Exhibits filed herewith are listed in the accompanying Index
to Exhibits.
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<PAGE>
ITEM 7(a) FINANCIAL STATEMENTS
- ------------------------------
INDEX TO FINANCIAL STATEMENTS
FULL YEAR (AUDITED)
- - Auditors' report 5
- - Consolidated profit and loss account
for the year ended December 31, 1995 6
- - Consolidated balance sheet
at December 31, 1995 7
- - Consolidated cash flow statement
for the year ended December 31, 1995 9
- - Notes to the accounts 10
INTERIM PERIOD (UNAUDITED)
- - Consolidated profit and loss account
10 Periods Ended October 6, 1996 and September 30, 1995 29
- - Consolidated balance sheet
At October 6, 1996 30
- - Consolidated cash flow statement
10 Periods Ended October 6, 1996 and September 30, 1995 31
- - Notes to the interim accounts 32
-4-
<PAGE>
DAF TRUCKS N.V.
AUDITORS' REPORT
Report of Moret Ernst & Young Independent Auditors
The Supervisory Board of
DAF Trucks N.V.
We have audited the accompanying consolidated balance sheet of DAF Trucks N.V.
as of December 31, 1995 and the related consolidated statements of profit and
loss account and cash flow for the year then ended which, as described in Notes
to the accounts, have been prepared on the basis of accounting principles
generally accepted in the Netherlands. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States and the Netherlands. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence of supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above, present fairly,
in all material respects, the consolidated financial position of DAF Trucks
N.V. at December 31, 1995, and the consolidated results of its operations and
its cash flow for the year then ended in conformity with accounting
principles generally accepted in the Netherlands.
Eindhoven, 13 March 1996
Moret Ernst & Young Accountants
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<PAGE>
DAF TRUCKS N.V.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
(NLG 000)
NOTES 1995
----
TURNOVER 1 2,894,181
Change in stocks of finished products (483)
Capitalised production for use in the Company 6,317
Other operating income 110
---------
TOTAL OPERATING INCOME 2,900,125
Cost of raw materials
and purchase value of commercial products 1,775,755
Costs of outwork and other external costs 159,110
Wages and salaries 2 321,664
Social security costs 2 72,384
Depreciation 58,835
Other operating costs 3 282,421
---------
TOTAL OPERATING COSTS 4 2,670,169
---------
OPERATING PROFIT 229,956
Net interest 5 4,404
---------
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 234,360
Taxation 6 (69,064)
Participation in subsidiaries' results 7 850
---------
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION 166,146
Minority interests 8 (2,332)
---------
NET PROFIT 163,814
---------
---------
EARNINGS PER SHARE (NLG) 441.55
---------
---------
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<PAGE>
DAF TRUCKS N.V.
CONSOLIDATED BALANCE SHEET AT 31 DECEMBER
AFTER INCORPORATION OF PROPOSAL REGARDING PROFIT APPROPRIATION
(NLG 000)
NOTES 1995
----
FIXED ASSETS
Tangible fixed assets 9 347,682
Financial fixed assets 10 8,764
---------
356,446
CURRENT ASSETS
Stocks 11 273,466
Debtors 12 553,745
Cash at bank and in hand 13 216,529
---------
1,043,740
TOTAL ASSETS 1,400,186
---------
---------
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<PAGE>
DAF TRUCKS N.V.
CONSOLIDATED BALANCE SHEET AT 31 DECEMBER
AFTER INCORPORATION OF PROPOSAL REGARDING PROFIT APPROPRIATION
NOTES 1995
----
Capital and reserves 14 578,117
Minority interests 15 14,313
---------
Group capital and reserves 592,430
Provisions for liabilities and
charges 16 256,129
Creditors - due after one year 17 84,973
Creditors - due within one year 18 466,654
---------
Total liabilities: 1,400,186
---------
---------
Risk capital:
Capital and reserves 578,117
Minority interests 14,313
Subordinated loans 54,110
---------
646,540
---------
---------
-8-
<PAGE>
DAF TRUCKS N.V.
CONSOLIDATED CASH FLOW STATEMENT
(NLG 000) 1995
----
Received from customers 2,773,226
Paid to suppliers (2,150,892)
Paid to employees (361,893)
----------
Cash flow from operations 260,441
Interest paid (17,617)
Interest received 13,555
Profits tax paid (71,712)
----------
CASH FLOW FROM OPERATING ACTIVITIES 184,667
----------
Acquisitions, including loans granted (1,336)
Expenditure on tangible fixed assets (69,812)
Sales of tangible fixed assets 69
CASH FLOW FROM CAPITAL EXPENDITURE
ACTIVITIES (71,079)
----------
WITHDRAWALS FROM PROVISIONS IN THE
OPENING BALANCE SHEET (6,684)
----------
Receipts from issue of share capital 5,000
Receipts from creditors - due after 1,189
one year
Repayments of creditors - due after
one year (23,498)
Dividend distributed (60,388)
----------
CASH FLOW FROM FINANCING ACTIVITIES (77,697)
----------
CHANGE IN CASH AT BANK AND IN HAND 29,207
Net cash at bank and in hand at 1 January 187,322
----------
Cash at bank and in hand at 31 December 216,529
----------
----------
The consolidated cash flow statement has been prepared according to
International Accounting Standard No. 7.
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<PAGE>
DAF TRUCKS N.V.
NOTES TO THE ACCOUNTS
ACCOUNTING POLICIES
BASIS OF CONSOLIDATION
The consolidated accounts include the accounts of DAF Trucks N.V. and of
participations in group companies, i.e. the companies in which the Company
holds a controlling interest. Minority interests in both the net assets and
results for the year have been separately disclosed in the consolidated
balance sheet and profit and loss account. Results from participations are
included in the consolidated accounts from the date of acquisition or
formation.
ORGANIZATION
DAF Trucks N.V. is a multinational truck manufacturing company with
operations principally in Benelux, the United Kingdom and other European
countries. There is no significant concentration of credit risk with any
individual customer.
FOREIGN CURRENCY
For foreign subsidiaries expenditure on fixed assets is translated at the
exchange rates ruling at the moment of acquisition. Expenditure on financial
assets, current assets and liabilities denominated in foreign currency relating
to both foreign subsidiaries and to the Company are translated at the exchange
rate ruling at the balance sheet date.
The profit and loss accounts of foreign subsidiaries denominated in foreign
currency are translated at the average exchange rates ruling during the year
under review, except for depreciation of fixed assets, which is translated at
historical exchange rates. Exchange differences arising from the use of the
exchange rates ruling at the balance sheet date for translating capital
components denominated in foreign currency (excluding fixed assets) and from
the use of the average rate of exchange for translating profit and loss
accounts denominated in foreign currency are incorporated directly in the
profit and loss account.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
PROFIT AND LOSS ACCOUNT
TURNOVER
Turnover consists of goods and services supplied, excluding VAT.
COST OF RAW MATERIALS AND PURCHASE VALUE OF COMMERCIAL PRODUCTS
The cost of the raw materials consumed is valued on the basis of the purchase
price. As well as the cost of raw materials, the purchase value of commercial
products sold, including purchased light vehicles, is also incorporated.
-10-
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DAF TRUCKS N.V.
NOTES TO THE ACCOUNTS
DEPRECIATION
Depreciation of tangible fixed assets is calculated on the basis of cost in
accordance with the linear method, using depreciation percentages based on the
useful life expected for each category of asset.
RESEARCH AND DEVELOPMENT EXPENDITURE
Research and development expenditure is charged to the profit and loss
account in the year in which the activities take place.
Costs relating to the maintenance and updating of the current product range
and which are necessary during the remainder of the life cycle of these
products are charged evenly to the profit and loss account. Since the current
product range will make it unnecessary for modifications to be made until a
later date, a provision for this has been formed and charged to the profit
and loss account.
Subsidies are deducted from the costs of the respective projects.
TAXATION
Provision for taxation is in general based on the profit for the year and is
calculated in accordance with tax laws prevailing in the relevant country of
operation.
RESULTS FROM PARTICIPATIONS
Results of non-consolidated equity investments are reported in accordance with
the net asset value method.
BALANCE SHEET
TANGIBLE FIXED ASSETS
Depreciation of tangible fixed assets is provided at rates calculated to
write off the cost of each asset evenly over its expected useful life.
Assets not instrumental to business activities are valued at their estimated
direct realisable value.
The maximum depreciation periods are respectively 40 years for buildings, 10
years for plant, machinery and tools and 8 years for other equipment.
The assets acquired from DAF N.V. will be written down over their remaining
life, which in the case of buildings is an average of 13-18 years, of plant,
machinery and tools 4 years and of other equipment 5 years.
FINANCIAL FIXED ASSETS
Equity investments in companies are stated at net asset value.
Receivables are stated at face value after making adequate provision for
doubtful debts.
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DAF TRUCKS N.V.
NOTES TO THE ACCOUNTS
STOCKS
Stocks of raw materials are valued at the lower of cost and net realisable
value, less provisions for obsolescence.
Stocks of semi-finished products and finished products are valued at the cost
of raw materials used and other direct and indirect production costs
associated with the process stage, less a provision for obsolescence.
DEBTORS
Debtors, including prepayments and accrued income, are stated at face value
after making adequate provision for doubtful debts. Long term debtors are
generally collateralized by truck equipment.
CASH AT BANK AND IN HAND
Cash at bank and in hand, including short-term deposits, is stated at nominal
value.
PROVISION FOR DEFERRED TAXATION
Provision for deferred taxation is calculated on a nominal basis on the
differences between the valuation of the assets and liabilities as per the
balance sheet and the fiscal valuation of the items in question.
The acute tax obligation is incorporated under creditors - due within one year.
OTHER PROVISIONS
Other provisions incorporates amounts relating to obligations and risks the
value of which is uncertain but can be estimated with a reasonable degree of
accuracy. These provisions are stated at nominal value.
OTHER ITEMS
Other items are stated at nominal value.
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<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
The Company's profit and loss account has been prepared in accordance with
article 402 of the Dutch Civil Code, Title 9, Volume 2.
1. INDUSTRY SEGMENT AND GEOGRAPHIC DATA
DAF operates in one principal industry, the manufacture of trucks and
distribution of related parts.
1995
----
Geographic area data:
Turnover:
Benelux 922,200
United Kingdom 810,300
Rest of Europe and Other 1,161,700
---------
2,894,200
---------
---------
Profit before taxation:
Benelux 217,000
United Kingdom 8,600
Rest of Europe and Other 8,800
---------
234,400
---------
---------
Identifiable assets:
Benelux 1,213,600
United Kingdom 59,700
Rest of Europe and Other 126,900
---------
1,400,200
---------
---------
2. EMPLOYEE COSTS
Social security costs include
pension costs of NLG 15.7 million
WORK FORCE
The average number of employees
was as follows:
The Netherlands 2,947
Belgium 1,198
United Kingdom 117
Other countries 122
-----
4,384
-----
-----
In addition, the services of an average of 303 agency staff were used.
-13-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
REMUNERATION OF THE BOARD OF MANAGEMENT AND THE SUPERVISORY BOARD
The total remuneration of the Board of Management, including charges for pension
arrangements, amounted to NLG 3.0 million. Remuneration of the Supervisory
Board totalled NLG 0.2 million.
3. OTHER OPERATING COSTS
Other operating costs incorporates allocations to
provisions in the amount of NLG 110.5 million.
Subsidies in the amount of NLG 19 million have been
deducted from these costs
4. TOTAL OPERATING COSTS
Expenses for research and development charged to the
profit and loss account are NLG 123 million.
5. NET INTEREST 1995
----
Interest receivable 15,744
Interest payable (11,340)
-------
Net interest 4,404
6. TAXATION (69,064)
Taxation is calculated on the profit, taking into
account the fiscal regulations applicable in the various
countries.
-14-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
1995
----
7. PARTICIPATION IN SUBSIDIARIES' RESULTS 850
This is the shareholding held by DAF Trucks N.V. in the
results of DAF Bus International B.V. in Eindhoven.
8. MINORITY INTERESTS (2,332)
This includes the 25% interest held by N.V. Truck
Financiering in Antwerp in the results of DAF Trucks
Vlaanderen N.V. in Westerlo, Flanders.
Interests in capital and results are calculated on the
basis of the accounts prepared and published in Flanders.
Adjustments made to the consolidation at Group level and
arising from the application of Group principles have not
been taken into account in this, since these are entirely
for the account of the Group and as such are not relevant
to the minority shareholder.
-15-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
9. TANGIBLE FIXED ASSETS
<TABLE>
<CAPTION>
Land Plant, Other Work Real Total
and machinery equipment in estate not
buildings and progress instrumental
tools and to
pre- business
payments activities
--------- --------- --------- -------- ------------ -----
<S> <C> <C> <C> <C> <C> <C>
Accumulated
acquisition value
Balance
1 January 1995 141,732 234,772 34,146 9,147 16,300 436,097
Changes in 1995:
Additions 16,322 40,794 11,621 1,075 -- 69,812
Disposals (96) (13) (23) -- -- (132)
Other -- (3) (75) -- -- (78)
--------- --------- --------- -------- ------------ -------
Balance
31 December 1995 157,958 275,550 45,669 10,222 16,300 505,699
--------- --------- --------- -------- ------------ -------
--------- --------- --------- -------- ------------ -------
Accumulated
depreciation
Balance
1 January 1995 15,540 71,752 12,038 -- -- 99,330
Changes in 1995:
Depreciation 9,941 41,500 7,394 -- -- 58,835
Disposals (96) (4) (9) -- -- (109)
Other -- (2) (37) -- -- (39)
--------- --------- --------- -------- ------------ -------
Balance
31 December 1995 25,385 113,246 19,386 -- -- 158,017
--------- --------- --------- -------- ------------ -------
--------- --------- --------- -------- ------------ -------
Book value
31 December 1995 132,573 162,304 26,283 10,222 16,300 347,682
--------- --------- --------- -------- ------------ -------
--------- --------- --------- -------- ------------ -------
</TABLE>
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<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
10. FINANCIAL FIXED ASSETS
Capital Other
and receiv-
Total reserves ables
----- -------- -------
Balance
1 January 1995 6,572 4,941 1,631
Changes in 1995:
Investment 3,271 621 2,650
Repayment (1,935) (1,935)
Participation in results 850 850 --
Other 6 -- 6
------ ------ -----
Balance
31 December 1995 8,764 6,412 2,352
------ ------ -----
------ ------ -----
Financial fixed assets comprise primarily the interest held in DAF Bus
International B.V. (19%) and loans granted to dealers.
1995
----
11. STOCKS
Raw materials and work
in progress 142,339
Finished products,
including service parts 131,127
-------
273,466
12. DEBTORS
Trade debtors 521,351
Other debtors 26,206
Prepayments and
accrued income 6,188
-------
553,745
13. CASH AT BANK AND IN HAND 216,529
Almost all the cash at bank and in hand is in the
form of interest-bearing, short-term deposits.
14. CAPITAL AND RESERVES 578,117
For details of the capital and reserves, reference is made to Note 24.
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DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
1995
----
15. MINORITY INTERESTS 14,313
This item is made up as follows:
Balance 1 January 1995 13,709
Third-party participation
in DAVISA (Spain) 463
Participation in results 2,332
Dividend (2,191)
-------
Balance 31 December 1995 14,313
See also note 8, Minority interests.
16. PROVISIONS FOR LIABILITIES AND CHARGES
Deferred taxation 31,395
Other provisions:
Product warranty, repair and maintenance
contracts 90,621
Maintaining product range 65,000
Strengthening sales network and
infrastructure 43,811
Environment 17,472
Other 7,830
-------
224,734
-------
256,129
The provision for product warranty and repair and maintenance contracts is due
to the level of related activities.
The provision for strengthening sales network and infrastructure comprises
extraordinary projects that have recently been started, the costs of which are
to be incurred for a limited number of years.
The environment provision comprises anticipated expenditure on essential soil
decontamination programmes.
The liabilities linked to the acquisition of the assets of DAF N.V. in 1993 were
almost entirely settled in 1995.
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<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
17. CREDITORS - DUE AFTER ONE YEAR
1995
----
Subordinated loans 54,110
Credit institutions 30,120
Other creditors 743
------
84,973
NATURE OF THE SUBORDINATION
These loans are subordinated to the claims of other existing and future
creditors of DAF Trucks N.V.
The repayment schedule and the average interest rates are as follows:
<TABLE>
<CAPTION>
REPAYMENT SCHEDULE FOR LOANS
-------------------------------------------------------
Total Interest
1996 1997 or later 1997/2000 After 2000 rates
---- ------------- --------- ---------- --------
<S> <C> <C> <C> <C> <C>
Subordinated loans
Dutch government -- 40,000 20,000 20,000 8.5%
Nationale Maatschappij voor
Krediet aan de Nijverheid N.V. 2,016 14,110 8,063 6,047 Variable
----- ------ ------ ------
2,016 54,110 28,063 26,047
Loans from credit institutions
Nationale Maatschappij voor
Krediet aan de Nijverheid N.V. 7,182 30,120 28,730 1,390 Variable
----- ------ ------ ------
Total 9,198 84,230 56,793 27,437
</TABLE>
Repayment commitments for 1996 are included in Creditors - due within one year
and repayment commitments after 1996 are included in Creditors - due after one
year.
At the end of 1995 De Nationale Investeringsbank N.V. exercised its right to
convert the subordinated loan in the amount of NLG 5 million into class A shares
(see also note 14).
DAF Trucks N.V. can avail itself of short-term credit facilities up to a
maximum amount of NLG 275 million, partly depending on the level of stocks
and debtors and (until 2003) decreasing stand-by facilities.
This facility has not been used, except for a number of bank guarantees
issued on behalf of third parties.
On behalf of the financiers collateral securities have been given in the form of
first mortgages on real estate in Belgium and the Netherlands and in the form of
liens on stocks, equipment and debtors in Belgium.
-19-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
1995
----
18. CREDITORS - DUE WITHIN ONE YEAR
Installments due on long-term loans
and other creditors 9,644
Trade creditors 207,094
Prepayments received 4,013
Bills of exchange and cheques 649
Taxation and social security 76,113
Interest payable 2,919
Holidays and holiday pay and distribution
of profits 43,261
Dividend 27,613
Other creditors 26,056
Accruals and deferred income 69,292
-------
466,654
FINANCIAL COMMITMENTS NOT TREATED AS A LIABILITY
LONG-TERM COMMITMENTS
The future commitments of the Group, which are mainly in respect of rental,
leasehold and leasing obligations, amount in total to NLG 46.5 million, which
are payable as follows:
(NLG millions) 1996 1997/2000 AFTER 2000 TOTAL
---- --------- ---------- -----
18.6 23.0 4.9 46.5
---- ---- --- ----
---- ---- --- ----
LIABILITIES FOR GUARANTEES GIVEN
Guarantees given on behalf of third parties amount to NLG 7.0 million.
PURCHASE COMMITMENTS
DAF Trucks N.V. has agreed to a minimum purchase guarantee with the supplier of
light trucks; this purchase guarantee is effective until the middle of 1999.
Commitments entered into for capital expenditure amount to NLG 59.3 million.
-20-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE CONSOLIDATED BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
Quarterly Results (Unaudited)
- -----------------------------
First Second Third Fourth
------- ------- ------- -------
Turnover 632,300 684,100 763,400 814,400
Operating Profit 43,200 58,400 56,300 72,100
Net Profit 30,700 41,900 41,300 49,900
SUPPLEMENTARY INFORMATION
ARTICLES OF ASSOCIATION AS TO PROFIT APPROPRIATION
The relevant Articles of Association as to profit appropriation, articles 28 and
29, are quoted below:
Article 28
28.1 The distribution of profits under the provisions of this article shall
take place after the adoption of the annual accounts from which it
appears that such distribution is allowed. Subject to the approval of
the Supervisory Board at least forty per cent (40%) of the profit shall
be distributed. The Supervisory Board may only withhold its approval to
a resolution concerning the distribution as mentioned above if the
solvency of the Company is less than forty-five per cent (45%); solvency
is defined in the context of these Articles of Association as the capital
and reserves expressed as a percentage of total assets as shown in the
Company's published consolidated annual accounts.
28.2 From the profits made in the preceding financial year, eight per cent
(8%) of their nominal value shall if possible be paid for the class A
shares, in accordance with paragraph 1 of this article. If the profits
made in any financial year are not sufficient to pay the percentage
mentioned above, the provisions of this article shall apply in subsequent
years only after the deficit has been recovered. From the profits that
remain, eight per cent (8%) of their nominal value shall if possible
subsequently be paid for the class B shares. If the profits made in any
financial year after the application of the provisions of paragraphs 1
and 2 are not sufficient to pay the percentage mentioned above, the
provisions of the preceding sentence shall apply only after the deficit
has been recovered.
28.3 The profits that remain after the application of the provisions of
paragraph 1 and paragraph 2 shall be paid to the shareholders in
proportion to their ownership of shares.
28.4 The Company shall only make payments to the shareholders and other
parties entitled to the profits allowed to be paid insofar as its capital
and reserves exceed the amount of the subscribed capital plus the
reserves kept by virtue of the law.
28.5 A deficit shall only be settled from the reserves laid down by the law
insofar as this is allowed by the law.
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<PAGE>
DAF TRUCKS N.V.
SUPPLEMENTARY INFORMATION
Article 29
29.1 Dividends shall be claimable four weeks after they have been declared,
unless another date is determined by the General Meeting on the proposal
of the Board of Management.
29.2 Dividends which have not been collected within five years after they have
become claimable shall fall to the Company.
29.3 The General Meeting may resolve that dividends shall be paid in a form
other than in cash, whether in whole or in part.
29.4 Without prejudice to the provisions of article 28, paragraph 3, the
General Meeting may resolve to pay reserves in whole or in part, provided
that this is in accordance with the provisions of article 105, paragraph
4 of the Dutch Civil Code, Volume 2.
29.5 Without prejudice to the provisions of article 28, paragraph 3, an
interim dividend will be paid from the profits of the current financial
year, if so determined by the General Meeting on the proposal of the
Board of Management, provided that this is in accordance with the
provisions of article 28, paragraph 2, and article 105, paragraph 4, of
the Dutch Civil Code, Volume 2.
PROPOSAL REGARDING PROFIT APPROPRIATION
With reference to article 28 of the Company's Articles of Association, the
Board of Management proposes, with the Supervisory Board's approval, that the
amount of NLG 40.8 million (110 NLG per share) should be distributed from the
profit made in 1995. This amount includes the interim dividend of NLG 14.8
million made payable at year end 1995. The dividend, excluding interim
dividend, will be distributed on 17 May 1996. The remaining amount of the
profit, being NLG 123.0 million, will be added to other reserves.
-22-
<PAGE>
DAF TRUCKS N.V.
NOTE: PAGES 23-28 ARE PARENT COMPANY ONLY FINANCIAL STATEMENTS AND FOOTNOTES
COMPANY ACCOUNTS
(NLG 000)
1995
------
PROFIT AND LOSS ACCOUNT
Result from group companies 7,359
Other results 156,455
-------
NET PROFIT 163,814
=======
BALANCE SHEET AT 31 DECEMBER
(After incorporating proposal regarding profit appropriation)
NOTE 1995
------
FIXED ASSETS
Tangible fixed assets 19 258,731
Group companies 20 81,530
Other investments 20 6,529
---------
346,790
CURRENT ASSETS
Stocks 21 202,470
Debtors 22 475,569
Cash at bank and in hand 23 172,012
---------
850,051
TOTAL ASSETS 1,196,841
=========
CAPITAL AND RESERVES: 24
Paid-up and called capital 374,237
Other reserves 203,880
---------
578,117
PROVISIONS 25 237,590
CREDITORS - DUE AFTER ONE YEAR 26 40,000
CREDITORS - DUE WITHIN ONE YEAR 27 341,134
---------
TOTAL LIABILITIES 1,196,841
=========
-23-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE COMPANY BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
19. TANGIBLE FIXED ASSETS
<TABLE>
<CAPTION>
Land Plant, Other Work Real Total
and machinery equipment in estate not
buildings and progress instrumental
tools and to
pre- business
payments activities
--------- --------- --------- -------- ------------ -----
<S> <C> <C> <C> <C> <C> <C>
Accumulated
acquisition value
- -----------------
Balance
1 January 1995 118,820 164,686 13,397 8,309 16,300 321,512
Changes in 1995:
Additions 14,583 25,787 8,310 510 -- 49,190
Disposals (96) (13) -- -- -- (109)
Balance ------- ------- ------ ----- ------ -------
31 December 1995 133,307 190,460 21,707 8,819 16,300 370,593
======= ======= ====== ===== ====== =======
Accumulated
depreciation
- ------------
Balance
1 January 1995 12,342 53,185 4,469 -- -- 69,996
Changes in 1995:
Depreciation 9,019 30,234 2,714 -- -- 41,967
Disposals (96) (5) -- -- -- (101)
Balance ------ ------- ------ ----- ------ -------
31 December 1995 21,265 83,414 7,183 -- -- 111,862
======= ======= ====== ===== ====== =======
Book value
31 December 1995 112,042 107,046 14,524 8,819 16,300 258,731
======= ======= ====== ===== ====== =======
</TABLE>
-24-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE COMPANY BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
20. FINANCIAL FIXED ASSETS
A list of the consolidated and non-consolidate group companies, drawn up in
accordance with the legal requirements, is available at the Trade Registry of
the Chamber of Commerce in Eindhoven.
Group companies Capital/
Total reserves Receivables
----- -------- -----------
Balance at 1 January 1995 79,099 61,852 17,247
Changes in 1995:
Net result 7,359 7,359
Investments 4,952 1,385 3,567
Disposals (5,942) -- (5,942)
Dividend (3,263) (3,263)
Foreign currency adjustments (675) 181 (856)
------ ------ ------
Balance at 31 December 1995 81,530 67,514 14,016
Other investments Capital/
Total reserves Receivables
----- -------- -----------
Balance at 1 January 1995 6,043 4,710 1,333
Changes in 1995:
Participation in results 850 850 --
Investments 924 638 286
Changes to receivables (1,333) -- (1,333)
Other 45 3 42
------ ----- ------
Balance at 31 December 1995 6,529 6,201 328
21. STOCKS 1995
----
Raw materials and work in progress 91,425
Finished products, including spare parts 111,045
-------
202,470
22. DEBTORS
Trade debtors 363,434
Group companies 86,495
Other debtors 21,560
Prepayments and accrued income 4,080
-------
475,569
23. CASH AT BANK AND IN HAND 172,012
Almost all the cash at bank and in hand is in the form of interest-bearing,
short-term deposits.
-25-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE COMPANY BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
24. CAPITAL AND RESERVES
After incorporating proposal regarding profit appropriation
Share Share Other Total
capital premium reserves
reserve
------- ------- -------- -------
Balance at 1 January 1995 371,000 -- 79,114 450,114
Conversion of subordinated loan 3,237 1,763 -- 5,000
Retained profit -- -- 123,003 123,003
------- ----- ------- -------
Balance at 31 December 1995 374,237 1,763 202,117 578,117
De Nationale Investeringsbank N.V. has exercised its right to convert the
subordinated loan in the amount of NLG 5 million into class A shares.
The conversion rate applied for this is NLG 1,544.79 per share, thereby
increasing the share capital by NLG 3,237,000 and bringing the share premium to
NLG 1,763,000.
SHARE CAPITAL
The authorised share capital amounts to NLG 700,000,000, comprising 350,000
class A shares of NLG 1,000 each, of which at 31 December 1995 284,237 had been
issued, called and fully paid up in cash, and 350,000 class B shares of NLG
1,000 each, of which at 31 December 1995 90,000 had been issued, called and
fully paid up in cash.
SHARE PREMIUM RESERVE
The share premium reserve arose when the subordinated loan of De Nationale
Investeringsbank N.V. was converted into class A shares.
OTHER RESERVES
At the end of 1995 an interim dividend of NLG 14.8 million (40 NLG per share)
was distributed. In conformity with the proposal regarding profit appropriation,
NLG 123.0 million of the net profit for 1995 has been added to other reserves.
25. PROVISIONS FOR LIABILITIES AND CHARGES 1995
----
Deferred taxation 31,395
Other provisions
Product warranty, repair and maintenance
contracts 77,222
Maintaining product range 65,000
Strengthening sales network and infrastructure 43,811
Environment 15,000
Other 5,162
------
206,195
-------
237,590
See note 16.
-26-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE COMPANY BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
26. CREDITORS - DUE AFTER ONE YEAR 1995
----
Subordinated loan 40,000
The repayment schedule and the average interest rates are as follows:
Repayment schedule for loan
----------------------------------------------------------
Total Interest
1996 1997 or later 1997/2000 After 2000 rates
---- ------------- --------- ---------- --------
SUBORDINATED LOAN
Dutch government -- 40,000 20,000 20,000 8.5%
27. CREDITORS - DUE WITHIN ONE YEAR 1995
----
Instalments due in 1995 on long-term loans --
Trade creditors 150,381
Prepayments received 2,947
Group companies 1,864
Taxation and social security 30,895
Interest payable 874
Holidays and holiday pay 35,330
Dividend 25,970
Other creditors 24,261
Accruals and deferred income 68,612
-------
341,134
For collateral securities given to financiers, refer to note 17, creditors - due
after one year.
-27-
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE COMPANY BALANCE SHEET
(ALL AMOUNTS IN THOUSANDS OF DUTCH GUILDERS UNLESS OTHERWISE STATED)
FINANCIAL COMMITMENTS NOT TREATED AS A LIABILITY
LIABILITY FOR GUARANTEES GIVEN
Third parties
Guarantees given on behalf of third parties amount to NLG 7.0 million.
Group companies
On the basis of article 403 of the Dutch Civil Code, Title 9, Volume 2, the
Company is severally liable for debts arising from legal transactions of a
number of Dutch group companies (total assets NLG 130,000).
COMMITMENTS ENTERED INTO
DAF Trucks N.V. has agreed to a minimum purchase guarantee with the supplier of
light trucks; this purchase guarantee is effective until the middle of 1999.
The commitments entered into for capital expenditure amount to NLG 35.7 million.
Eindhoven, 13 March 1996
Supervisory Board Board of Management
-28-
<PAGE>
<TABLE>
<CAPTION>
DAF TRUCKS N.V.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
(UNAUDITED)
(NLG 000) 10 PERIODS ENDED
OCTOBER 6 SEPTEMBER 30
1996 1995
---- ----
<S> <C> <C>
TURNOVER 2,298,795 2,079,812
Change in stocks of finished products 44,923 49,530
Capitalised production for use in
the Company 3,608 3,565
Other operating income (16) 2,280
--------- ---------
TOTAL OPERATING INCOME 2,347,310 2,135,187
Cost of raw materials
and purchase value of commercial products 1,445,525 1,305,143
Costs of outwork and other external costs 118,945 102,573
Wages and salaries 283,853 255,276
Social security costs 64,433 57,447
Depreciation 45,385 41,709
Other operating costs 236,954 212,647
--------- ---------
TOTAL OPERATING COSTS 2,195,095 1,974,795
--------- ---------
OPERATING PROFIT 152,215 160,392
Net interest 5,551 3,569
--------- ---------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 157,766 163,961
Taxation (50,643) (48,370)
--------- ---------
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION 107,123 115,591
Minority interests (206) (1,719)
--------- ---------
NET PROFIT 106,917 113,872
</TABLE>
29
<PAGE>
DAF TRUCKS N.V.
<TABLE>
CONSOLIDATED BALANCE SHEET
(NLG 000) (UNAUDITED)
OCTOBER 6
1996
---------
<S> <C>
FIXED ASSETS
Tangible fixed assets 374,056
Financial fixed assets 12,808
---------
386,864
CURRENT ASSETS
Stocks 341,110
Debtors 541,021
Cash at bank and in hand 183,968
---------
1,066,099
---------
TOTAL ASSETS 1,452,963
---------
---------
Capital and reserves 685,035
Minority interests 14,519
---------
Group capital and reserves 699,554
Provisions for liabilities and charges 228,246
Creditors - due after one year 71,586
Creditors - due within one year 453,577
---------
TOTAL LIABILITIES 1,452,963
---------
---------
Risk capital:
Capital and reserves 685,035
Minority interests 14,519
Subordinated loans 48,345
---------
747,899
---------
---------
</TABLE>
30
<PAGE>
DAF TRUCKS N.V.
<TABLE>
CONSOLIDATED CASH FLOW STATEMENT
(UNAUDITED)
(NLG 000) 10 PERIODS ENDED
OCTOBER 6 SEPTEMBER 30
1996 1995
--------- ----------
<S> <C> <C>
Received from customers 2,339,555 2,094,350
Paid to suppliers (1,849,832) (1,603,505)
Paid to employees (355,767) (313,961)
--------- ----------
Cash flow from operations 133,956 176,884
Interest paid (9,767) (12,177)
Interest received 15,739 9,510
Profits tax paid (62,767) (47,167)
--------- ----------
CASH FLOW FROM OPERATIONS 77,161 127,050
--------- ----------
Acquisitions, including loans granted (4,044) (4,193)
Expenditure on tangible fixed assets (82,200) (44,448)
Sales of tangible fixed assets 10,703 --
--------- ----------
CASH FLOW FROM CAPITAL EXPENDITURE
ACTIVITIES (75,541) (48,641)
---------- ----------
WITHDRAWALS FROM PROVISIONS IN THE
OPENING BALANCE SHEET (10) (6,698)
---------- ----------
Receipts from creditors - 2,922 1,986
due after one year
Repayments of creditors - (9,480) (17,788)
due after one year
Dividend distributed (27,613) (45,000)
--------- ----------
CASH FLOW FROM FINANCING ACTIVITIES (34,171) (60,802)
---------- ----------
CHANGE IN CASH AT BANK AND IN HAND (32,561) 10,909
Net cash at bank and in hand at 1 January 216,529 187,322
--------- ----------
Cash at bank and in hand at end period 10 183,968 198,231
--------- ----------
--------- ----------
</TABLE>
The consolidated cash flow statement has been prepared according to
International Accounting Standard No. 7.
31
<PAGE>
DAF TRUCKS N.V.
NOTES TO THE INTERIM ACCOUNTS (UNAUDITED)
1. BASIS OF PRESENTATION
The financial information at October 6, 1996 and for the ten periods ended
October 6, 1996 and September 30, 1995 is unaudited, but includes all
adjustments (consisting only of normal recurring adjustments) that DAF Trucks
N.V. considers necessary for a fair presentation of the financial position at
such date and the operating results and cash flows for those periods. Operating
results for ten 4-week periods approximates the results for the nine-month
period required by Rule 3-05 of Regulation S-X. In addition, the operating
results for the ten periods ended October 6, 1996 are not necessarily indicative
of the results that may be expected for the entire year. For further
information, refer to the audited consolidated financial statements and
footnotes for 1995, included in this document.
2. STOCKS (INVENTORIES)
(UNAUDITED)
(NLG 000) OCTOBER 6 DECEMBER 31
1996 1995
--------- -----------
Raw materials and work-in-progress 149,987 142,339
Finished products, including service parts 191,123 131,127
--------- -----------
341,110 273,466
--------- -----------
--------- -----------
Stocks of raw materials are valued at lower of cost and net realisable value,
less provisions for obsolescence. Stocks of finished products are valued at the
cost of raw materials used and other direct and indirect production costs, less
a provision for obsolescence.
32
<PAGE>
ITEM 7(b) PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma condensed consolidated financial
information reflects the acquisition by PACCAR Inc (PACCAR) of all
outstanding shares of DAF Trucks N.V. (DAF), a Netherlands
corporation. PACCAR Inc paid NLG 900 million for all outstanding
shares of DAF. The preliminary purchase price allocation is based
on the September 30, 1996 exchange rate of NLG 1.71:$1, or
approximately $526 million. As a precondition to the purchase, DAF
was required to purchase a 25% minority interest in a Belgium
subsidiary, DAF Trucks Vlaanderen N.V., for NLG 33 million. In
addition, DAF was required to apply its cash balances to reduce
long-term debt by NLG 40 million. Sources of the funds used for
the acquisition of DAF consisted of NLG 300 million from PACCAR
Inc cash reserves, with the remaining balance borrowed under terms
of two Dutch Guilder notes of NLG 300 million each. While PACCAR
has the intent and ability to refinance all or a portion of these
short term borrowings on a longer-term basis, no specific
arrangements had been made as of the filing date of this Form
8-K/A. Accordingly, the NLG 600 million borrowing is classified as
a current liability.
The unaudited pro forma condensed consolidated balance sheet
reflects the acquisition as if it had occurred on September 30,
1996. The unaudited proforma condensed consolidated statements of
income for the year ended December 31, 1995 and the nine months
ended September 30, 1996 reflect the acquisition as if it had
occurred at the beginning of the fiscal year presented. The pro
forma information is based on the historical financial statements
of PACCAR and DAF after giving effect to the acquisition using the
purchase method of accounting and assumptions and adjustments
deemed appropriate by PACCAR, which are described in the
accompanying notes to the pro forma condensed financial
statements.
The historical financial statements of DAF included in Item 7(a)
herein are expressed in Dutch Guilders (NLG) and are prepared in
accordance with accounting principles generally accepted in the
Netherlands. For purposes of pro forma information, certain
reclassifications have been made to the Netherlands GAAP
historical statements to conform with the U.S. GAAP presentation.
The statements have been translated into U.S dollars at the
September 30, 1996 rate of NLG 1.71:$1 for the unaudited pro forma
condensed consolidated balance sheet as of September 30, 1996. For
the unaudited pro forma condensed consolidated income statement
for the nine months ended September 30, 1996, an average exchange
rate of NLG 1.6798:$1 was used. The DAF income statement for the
year ended December 31, 1995 has been translated to U.S. dollars
at the 1995 average rate of NLG 1.5969:$1. These translations
should not be construed as representations that the Dutch Guilder
amounts represent, or have been, or could be converted into, U.S.
dollars at that or any other rate.
The pro forma condensed consolidated information does not purport
to be indicative of PACCAR's financial position or results of
operations had the acquisition actually occurred on the dates
presented nor is it necessarily indicative of PACCAR's future
financial position or future operating results. The pro forma
condensed consolidated financial information should be read in
conjunction with the separate audited historical consolidated
financial statements of PACCAR and the notes thereto set forth in
PACCAR's 1995 Annual Report on Form 10-K, and the historical
consolidated financial statements of DAF and the notes thereto set
forth in Item 7(a) of this Form 8-K/A.
-33-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
FOR THE YEAR ENDED DECEMBER 31, 1995
- -----------------------------------------------------------------------------
Pro Forma Condensed Consolidated Statement of Income (Unaudited)
(Millions except per share data)
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
PACCAR DAF Trucks Pro Forma Pro
Inc N.V. Adjustments Forma
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MANUFACTURING AND PARTS:
Total Revenues $4,590.7 $1,830.8 $6,421.5
Costs and Expenses
Cost of sales 3,950.7 1,498.3 5,449.0
Selling, general and administrative 334.6 187.2 6.8 528.6
Interest 2.0 7.1 12.0 21.1
- -----------------------------------------------------------------------------
4,287.3 1,692.6 18.8 5,998.7
- -----------------------------------------------------------------------------
Manufacturing and Parts Income
Before Income Taxes 303.4 138.2 (18.8) 422.8
FINANCIAL SERVICES:
Revenues 257.5 257.5
Costs and Expenses
Interest and other 143.5 143.5
Selling, general and administrative 46.4 46.4
Provision for losses on receivables 14.3 14.3
- -----------------------------------------------------------------------------
204.2 204.2
- -----------------------------------------------------------------------------
Financial Services Income
Before Income Taxes 53.3 53.3
OTHER:
Investment income 27.7 8.7 (8.0) 28.4
Minority interest and other 15.2 (.9) .9 15.2
- -----------------------------------------------------------------------------
Total Income Before Income Taxes 399.6 146.0 (25.9) 519.7
Income taxes 146.8 43.3 (7.4) 182.7
- -----------------------------------------------------------------------------
Net Income $ 252.8 $ 102.7 $ (18.5) $ 337.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Weighted average number of
common shares outstanding 38.9 38.9
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Per Share Data:
Net income $ 6.50 $ 8.66
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
-34-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
- -----------------------------------------------------------------------------
Pro Forma Condensed Consolidated Statement of Income (Unaudited)
(Millions except per share data)
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
PACCAR DAF Trucks Pro Forma Pro
Inc N.V. Adjustments Forma
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MANUFACTURING AND PARTS:
Total Revenues $3,114.6 $1,367.6 $4,482.2
Costs and Expenses
Cost of sales 2,700.8 1,130.9 3,831.7
Selling, general and administrative 265.3 143.1 4.8 413.2
Interest 1.7 5.2 8.6 15.5
- -----------------------------------------------------------------------------
2,967.8 1,279.2 13.4 4,260.4
- -----------------------------------------------------------------------------
Manufacturing and Parts Income
Before Income Taxes 146.8 88.4 (13.4) 221.8
FINANCIAL SERVICES:
Revenues 200.3 200.3
Costs and Expenses
Interest and other 110.9 110.9
Selling, general and administrative 35.2 35.2
Provision for losses on receivables 3.9 3.9
- -----------------------------------------------------------------------------
150.0 150.0
- -----------------------------------------------------------------------------
Financial Services Income
Before Income Taxes 50.3 50.3
OTHER:
Investment income 20.9 5.6 (6.0) 20.5
Minority interest and other 1.2 (.1) .1 1.2
- -----------------------------------------------------------------------------
Total Income Before Income Taxes 219.2 93.9 (19.3) 293.8
Income taxes 80.7 30.2 (5.6) 105.3
- -----------------------------------------------------------------------------
Net Income $ 138.5 $ 63.7 $ (13.7) $ 188.5
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Weighted average number of
common shares outstanding 38.9 38.9
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Per Share Data:
Net income $ 3.56 $ 4.85
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
-35-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED, IN MILLIONS)
Pro forma adjustments for the periods presented were as follows:
9 Months
Year Ended Ended
12/31/95 9/30/96
---------- --------
1. Adjustments to Manufacturing and Parts selling,
general and administrative expense:
(a) Depreciation expense resulting from fair
value adjustments to property, plant and
equipment. Depreciation periods range
from 10 to 20 years. $ 2.1 $ 1.5
(b) Amortization expense related to incremental
goodwill assuming a 25-year amortization
period. 4.7 3.3
----- -----
$ 6.8 $ 4.8
----- -----
----- -----
2. Adjustments to Manufacturing and Parts interest expense:
(a) Interest expense related to acquisition debt
computed using a 3.2% interest rate and a principal
balance of NLG 600 million. $12.0 $ 8.6
----- -----
----- -----
Actual interest expense according to terms of the
notes are based on the Amsterdam Interbank Offered
Rate (AIBOR) plus a margin. The difference between
applying this method and using the indicated interest
rate was not significant.
3. Adjustment to reflect a reduction in investment income
due to the utilization of cash as part of the acquisition
cost. Approximately $175 million at a blended yield of
4.6% for both periods. $ 8.0 $ 6.0
----- -----
----- -----
4. Adjustment to eliminate 25% minority interest in a
Belgium subsidiary purchased as a precondition to
the purchase of DAF. Amount attributable to remaining
minority interest was immaterial. $ .9 $ .1
----- -----
----- -----
5. Adjustments to income taxes:
(a) Income tax expense adjustment resulting from
taxable pro forma adjustments to income computed
at a statutory rate approximating 35%. The effective
income tax rate on a pro forma basis is adversely
impacted by nondeductible goodwill amortization. $(7.4) $(5.6)
----- -----
----- -----
-36-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
PACCAR DAF Trucks Pro Forma Pro
ASSETS (Millions of Dollars) Inc N.V. Adjustments Forma
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MANUFACTURING AND PARTS:
Current Assets
Cash and marketable securities $ 611.0 $ 107.6 $ (23.4)(e) $ 500.6
(175.4)(g)
(19.2)(h)
Trade receivables, net 266.7 309.8 576.5
Inventories 217.9 199.5 417.4
Deferred taxes and other current assets 62.2 6.6 68.8
- -----------------------------------------------------------------------------------
Total Manufacturing and
Parts Current Assets 1,157.8 623.5 (218.0) 1,563.3
Deferred Taxes, Goodwill and Other 80.9 7.5 114.2 (b) 202.6
Property, Plant and Equipment, Net 466.1 218.7 35.8 (a) 720.6
- -----------------------------------------------------------------------------------
Total Manufacturing and Parts Assets 1,704.8 849.7 (68.0) 2,486.5
- -----------------------------------------------------------------------------------
FINANCIAL SERVICES:
Cash and equivalents 22.1 22.1
Finance and other receivables,
net of allowance for losses 2,876.7 2,876.7
Less unearned interest (226.4) (226.4)
- -----------------------------------------------------------------------------------
2,650.3 2,650.3
Equipment on operating leases, net 42.3 42.3
Other assets 20.6 20.6
- -----------------------------------------------------------------------------------
Total Financial Services Assets 2,735.3 2,735.3
- -----------------------------------------------------------------------------------
$4,440.1 $ 849.7 $ (68.0) $5,221.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
</TABLE>
-37-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
PACCAR DAF Trucks Pro Forma Pro
LIABILITIES AND STOCKHOLDERS' EQUITY Inc N.V. Adjustments Forma
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MANUFACTURING AND PARTS:
Current Liabilities
Accounts payable and accrued expenses $ 650.8 $ 240.7 $ 891.5
Notes payable 350.9 (f) 350.9
Income taxes 18.7 16.6 35.3
Other .5 7.9 (2.2)(e) 6.2
- -----------------------------------------------------------------------------------
Total Manufacturing and
Parts Current Liabilities 670.0 265.2 348.7 1,283.9
Long-Term Debt 12.6 41.9 (21.2)(e) 33.3
Other 130.9 133.5 13.2 (c) 277.6
- -----------------------------------------------------------------------------------
Total Manufacturing and
Parts Liabilities 813.5 440.6 340.7 1,594.8
- -----------------------------------------------------------------------------------
FINANCIAL SERVICES:
Accounts payable and accrued expenses 35.6 35.6
Commercial paper and bank loans 977.0 977.0
Long-term debt 1,107.9 1,107.9
Deferred income taxes and other 143.9 143.9
- -----------------------------------------------------------------------------------
Total Financial Services Liabilities 2,264.4 2,264.4
- -----------------------------------------------------------------------------------
Minority Interest 8.5 (8.1)(h) .4
STOCKHOLDERS' EQUITY
Preferred stock no par value:
Authorized 1.0 million shares,
none issued
Common stock, $12 par value:
Authorized 100.00 million
shares, issued 38.9 million shares 466.3 218.9 (218.9) 466.3
Additional paid-in capital 218.7 1.0 (1.0) 218.7
Retained earnings 763.2 180.7 (180.7) 763.2
Currency translation and
net unrealized investment adjustments (86.0) (86.0)
- -----------------------------------------------------------------------------------
Total Stockholders' Equity $1,362.2 $ 400.6 (400.6)(d) 1,362.2
- -----------------------------------------------------------------------------------
$4,440.1 $ 849.7 $ (68.0) $5,221.8
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
</TABLE>
-38-
<PAGE>
PACCAR INC AND DAF TRUCKS, N.V.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED, IN MILLIONS)
1. Preliminary purchase price allocation:
NLG $'s
----- -----
(a) Property, plant and equipment 61.3 35.8
(b) Goodwill 195.3 114.2
(c) Deferred tax liabilities (22.6) (13.2)
----- -----
Total fair value adjustment 234.0 136.8
(d) DAF's stockholders' equity 685.0 400.6
(h) Premium on purchase of
minority interest (19.0) (11.1)
----- -----
Aggregate purchase price 900.0 526.3
----- -----
----- -----
2. Other pro forma adjustments:
(e) Application of DAF's cash balances to reduce pro forma
consolidated debt balances by NLG 40
(f) Recognition of NLG 600 notes payable used to
partially finance acquisition
(g) Recognition of NLG 300 of cash reserves used to
partially finance acquisition
3. Purchase of minority interest:
(h) Purchase of minority interest for approximately
NLG 33 (US $19.2); the carrying value of the minority interest
was NLG 14 (US $8.1) for a premium of NLG 19 (US $11.1); DAF has a
continuing minority interest in a sales subsidiary located in
Spain
4. Estimated acquisition expenses were immaterial
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PACCAR INC
-----------------------
(Registrant)
Date January 29, 1997 By /s/ G. D. Hatchel
----------------------- -----------------------
G. D. Hatchel
Vice President and Controller
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<PAGE>
INDEX TO EXHIBITS
Exhibit (in order of assigned index numbers)
- --------------------------------------------
2 Plan of acquisition, reorganization, arrangement, liquidation or succession:
(a) "Agreement for the Sale and Purchase of the Entire Issued and
Outstanding Share Capital of DAF Trucks N.V." (incorporated by reference
to Form 8-K/A, Amendment No. 1 to Current Report, November 15, 1996 date
of report).
(b) List of Omitted Schedules
The following schedules were omitted from the filing but will be
furnished to the Commission upon request:
(i) Schedule A - Selling Shareholders
(ii) Schedule B - Form of Notarial Deed
(iii) Schedule C - Escrow Agreement
(iv) Schedule D - Bank Accounts
(v) Schedule E - Warranties
(vi) Schedule F - PACCAR Undertakings
23.1 Consent of Independent Auditors
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<PAGE>
EXHIBIT 23.1
CONSENT OF MORET ERNST & YOUNG INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 2-83673) pertaining to the 1981 Long-Term Incentive Plan and in
the Registration Statement (Form S-8 No. 33-47763) pertaining to the 1991 Long-
Term Incentive Plan of PACCAR Inc of our report dated March 13, 1996 with
respect to the consolidated financial statements of DAF Trucks N.V. included in
this Current Report on Form 8-K.
Moret Ernst & Young
Eindhoven, Netherlands
January 29, 1997
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