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Updated Wednesday, December 5, 2012 at 11:16 AM

Paccar issues special dividend

By Drew DeSilver
Seattle Times business reporter

Paccar declared an extra dividend of 80 cents a share Tuesday, payable just before year-end.

Unlike many big companies announcing one-time dividends to get ahead of possible 2013 tax hikes, the Bellevue-based truck maker has a long history of special end-of-year payouts.

Over the past two decades, the only year in which Paccar didn’t pay a special dividend was 2009.

It resumed the cash payouts in 2010, at 30 cents per share. Last year’s special dividend was 70 cents per share.

The company said the dividend is payable Dec. 28 to shareholders of record as of Dec. 14. It also declared a regular quarterly dividend of 20 cents a share payable in March.

Dividend income currently is taxed at 15 percent for most taxpayers; those in the lowest brackets pay no tax. But unless Congress and the president strike a deal before the end of the year to avert the so-called “fiscal cliff,” dividends will be taxed the same as ordinary income, at rates up to 39.6 percent for the richest taxpayers.

And many observers expect higher taxes on dividends as part of any deal, at least for wealthier taxpayers.

Last week Costco announced a $7-per-share dividend distribution, totaling $3 billion, to beat the potential rate increase.

Paccar’s special dividend will cost the company roughly $283 million — which it can easily afford with its cash and equivalents of nearly $1.7 billion.

As with all dividends, the biggest shareholders get the most out of a special dividend. At Paccar, the biggest shareholders are chairman and CEO Mark Pigott and his brother John, a director of the company.

Mark Pigott, along with his family and related entities, held nearly 4.6 million Paccar shares as of last month, according to regulatory filings. He will receive about $3.66 million of the special dividend, along with $915,000 from the regular quarterly dividend of 20 cents per share.

John Pigott, who directly and indirectly owns 2.28 million shares, will get $1.8 million from the special dividend and $456,000 from the regular one.

Paccar makes light-, medium- and heavy-duty trucks under the Kenworth, Peterbilt and DAF nameplates.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com


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