Stockholders' Equity

9 Months Ended

Sep. 30, 2021

Equity [Abstract]

Stockholders' Equity

NOTE G - Stockholders’ Equity

Comprehensive Income

The components of comprehensive income are as follow:

	Three Months Ended						Nine Months Ended
	September 30						September 30
	2021			2020			2021			2020
Net income	$	377.7		$	385.5		$	1,340.7		$	892.6
Other comprehensive income (loss) (OCI):
Unrealized gains (losses) on derivative contracts		8.2			(17.9	)		29.4			1.3
Tax effect		(1.6	)		3.4			(7.6	)		.6
		6.6			(14.5	)		21.8			1.9
Unrealized (losses) gains on marketable debt securities		(3.4	)					(12.2	)		12.4
Tax effect		.7						2.9			(3.0	)
		(2.7	)					(9.3	)		9.4
Pension plans		22.7			3.4			49.0			45.7
Tax effect		(5.4	)		(.6	)		(11.6	)		(10.8	)
		17.3			2.8			37.4			34.9
Foreign currency translation (losses) gains		(136.8	)		112.6			(144.8	)		(135.1	)
Net other comprehensive (loss) income		(115.6	)		100.9			(94.9	)		(88.9	)
Comprehensive income	$	262.1		$	486.4		$	1,245.8		$	803.7

Accumulated Other Comprehensive Income (Loss)

The components of AOCI and the changes in AOCI, net of tax, included in the Consolidated Balance Sheets and the Consolidated Statements of Stockholders’ Equity consisted of the following:

Three Months Ended September 30, 2021	DERIVATIVE CONTRACTS			MARKETABLE DEBT SECURITIES			PENSION PLANS			FOREIGN CURRENCY TRANSLATION			TOTAL
Balance at July 1, 2021	$	(14.0	)	$	8.0		$	(558.0	)	$	(465.6	)	$	(1,029.6	)
Recorded into AOCI		35.3			(2.5	)		6.1			(136.8	)		(97.9	)
Reclassified out of AOCI		(28.7	)		(.2	)		11.2						(17.7	)
Net other comprehensive income (loss)		6.6			(2.7	)		17.3			(136.8	)		(115.6	)
Balance at September 30, 2021	$	(7.4	)	$	5.3		$	(540.7	)	$	(602.4	)	$	(1,145.2	)

Three Months Ended September 30, 2020	DERIVATIVE CONTRACTS			MARKETABLE DEBT SECURITIES			PENSION PLANS			FOREIGN CURRENCY TRANSLATION			TOTAL
Balance at July 1, 2020	$	1.1		$	15.5		$	(485.6	)	$	(820.9	)	$	(1,289.9	)
Recorded into AOCI		(46.9	)		.4			(6.4	)		112.6			59.7
Reclassified out of AOCI		32.4			(.4	)		9.2						41.2
Net other comprehensive (loss) income		(14.5	)					2.8			112.6			100.9
Balance at September 30, 2020	$	(13.4	)	$	15.5		$	(482.8	)	$	(708.3	)	$	(1,189.0	)

Nine Months Ended September 30, 2021	DERIVATIVE CONTRACTS			MARKETABLE DEBT SECURITIES			PENSION PLANS			FOREIGN CURRENCY TRANSLATION			TOTAL
Balance at January 1, 2021	$	(29.2	)	$	14.6		$	(578.1	)	$	(457.6	)	$	(1,050.3	)
Recorded into AOCI		42.8			(8.2	)		3.3			(144.8	)		(106.9	)
Reclassified out of AOCI		(21.0	)		(1.1	)		34.1						12.0
Net other comprehensive income (loss)		21.8			(9.3	)		37.4			(144.8	)		(94.9	)
Balance at September 30, 2021	$	(7.4	)	$	5.3		$	(540.7	)	$	(602.4	)	$	(1,145.2	)

Nine Months Ended September 30, 2020	DERIVATIVE CONTRACTS			MARKETABLE DEBT SECURITIES			PENSION PLANS			FOREIGN CURRENCY TRANSLATION			TOTAL
Balance at January 1, 2020	$	(15.3	)	$	6.1		$	(517.7	)	$	(573.2	)	$	(1,100.1	)
Recorded into AOCI		14.5			10.6			2.4			(135.1	)		(107.6	)
Reclassified out of AOCI		(12.6	)		(1.2	)		32.5						18.7
Net other comprehensive income (loss)		1.9			9.4			34.9			(135.1	)		(88.9	)
Balance at September 30, 2020	$	(13.4	)	$	15.5		$	(482.8	)	$	(708.3	)	$	(1,189.0	)

Reclassifications out of AOCI were as follows:

		Three Months Ended
	LINE ITEM IN THE CONSOLIDATED STATEMENTS OF	September 30
AOCI COMPONENTS	COMPREHENSIVE INCOME		2021			2020
Unrealized losses (gains) on derivative contracts:
Truck, Parts and Other
Foreign-exchange contracts	Net sales and revenues	$	1.3		$	(10.6	)
	Cost of sales and revenues		(3.5	)		2.5
	Interest and other (income), net		(.5	)		(.4	)
Financial Services
Interest-rate contracts	Interest and other borrowing expenses		(35.4	)		50.5
	Pre-tax expense (reduction) increase		(38.1	)		42.0
	Tax expense (benefit)		9.4			(9.6	)
	After-tax expense (reduction) increase		(28.7	)		32.4
Unrealized gains on marketable debt securities:
Marketable debt securities	Investment income		(.3	)		(.6	)
	Tax expense		.1			.2
	After-tax income increase		(.2	)		(.4	)
Pension plans:
Truck, Parts and Other
Actuarial loss	Interest and other (income), net		14.7			11.1
Prior service costs	Interest and other (income), net		.2			.4
Settlement loss	Interest and other (income), net					.5
	Pre-tax expense increase		14.9			12.0
	Tax benefit		(3.7	)		(2.8	)
	After-tax expense increase		11.2			9.2
Total reclassifications out of AOCI		$	(17.7	)	$	41.2

		Nine Months Ended
	LINE ITEM IN THE CONSOLIDATED STATEMENTS OF	September 30
AOCI COMPONENTS	COMPREHENSIVE INCOME		2021			2020
Unrealized losses (gains) on derivative contracts:
Truck, Parts and Other
Foreign-exchange contracts	Net sales and revenues	$	14.9		$	(22.2	)
	Cost of sales and revenues		2.5			.2
	Interest and other (income), net		(.2	)		(5.2	)
Financial Services
Interest-rate contracts	Interest and other borrowing expenses		(45.9	)		13.2
	Pre-tax expense reduction		(28.7	)		(14.0	)
	Tax expense		7.7			1.4
	After-tax expense reduction		(21.0	)		(12.6	)
Unrealized gains on marketable debt securities:
Marketable debt securities	Investment income		(1.5	)		(1.6	)
	Tax expense		.4			.4
	After-tax income increase		(1.1	)		(1.2	)
Pension plans:
Truck, Parts and Other
Actuarial loss	Interest and other (income), net		44.2			33.1
Prior service costs	Interest and other (income), net		.6			1.1
Settlement loss	Interest and other (income), net					8.5
	Pre-tax expense increase		44.8			42.7
	Tax benefit		(10.7	)		(10.2	)
	After-tax expense increase		34.1			32.5
Total reclassifications out of AOCI		$	12.0		$	18.7

Stock Compensation Plans

Stock-based compensation expense was $2.6 and $12.0 for the three and nine months ended September 30, 2021, respectively and $2.3 and $10.5 for the three and nine months ended September 30, 2020, respectively.

During the nine months of 2021, the Company issued 628,779 common shares under deferred and stock compensation arrangements.  

Other Capital Stock Changes

During the first nine months of 2021, the Company acquired no treasury shares under the Company’s common stock repurchase plans. The Company acquired 16,688 shares under the Company’s Long-Term Incentive Plan. Stock repurchases of $390.0 million remain authorized under the current $500.0 million program approved by the PACCAR Board of Directors on December 4, 2018.