- Aggregates Manager - http://www.aggman.com -
Navistar reports first-quarter results
Posted By Tina Grady Barbaccia On March 8, 2012 @ 8:13 am In Aggbeat Online,Aggman Newsletter,Economics | No Comments
Lisle, Ill.-based Navistar International Corp. on March 8 reported a loss of $153 million, or $2.19 per diluted share, for the first quarter ended Jan. 31, 2012, which included a charge for pre-existing warranty expense of $112 million related to legacy and initial-built 2010 engines. After adjustments to exclude engineering integration costs, Navistar’s loss for the first quarter 2012 was $145 million, or $2.08 per diluted share.
Traditionally, the first quarter is the weakest period for Navistar due to seasonal downtime in its two largest markets. Additionally, at its analyst day Feb. 1, the company said it expected a first quarter 2012 loss due to a series of factors, including higher year-over-year healthcare costs; the start up of a new foundry operation; a brake supplier issue that interrupted truck shipments; the temporary shutdown of a key OEM customer of its South America operations due to the Thailand floods; and efforts to improve customers’ vehicles during a traditionally slow period.
“We proactively addressed these product issues in a low usage period during the first quarter, which we believe will improve long-term customer satisfaction and reduce warranty costs,” said Daniel C. Ustian, Navistar chairman, president, and chief executive officer. “Strategically, we achieved a number of key milestones in the first quarter, including our submission of a 0.2 NOx engine for EPA certification and the announcement of our development of a full range of natural gas truck offerings.”
Based on its first quarter 2012 results, the company updated its guidance for adjusted net income attributable to Navistar International Corporation for fiscal year ending Oct. 31, 2012, to be between $295 and $365 million, or $4.25 to $5.25 adjusted diluted earnings per share. As stated in the company’s analyst day news release, this expectation also includes the absorption of approximately $90 million in higher post retirement health care costs compared to last year and an effective tax rate of 25 to 30 percent with cash taxes expected to be below 10 percent. Navistar says that it anticipates that North American truck demand will increase 5 to 18 percent in the fiscal year ending October 31, 2012, to a range of 275,000 to 310,000.
“We remain confident in our ability to deliver strong 2012 profit performance and make continued progress toward our long-term growth goals,” Ustian said. “We are already seeing accelerated synergies from our recent move into our new integrated product development center beyond the $60 million we originally estimated. We now believe this integration of our people will unlock up to $100 million in savings toward our bottom line in 2012.”
Consolidated net sales and revenues rose 11 percent in the first quarter of 2012, versus the year-ago first quarter, which is driven by increased truck volumes in traditional and worldwide markets. In the year-ago first quarter, Navistar reported sales and revenues of $2.7 billion and a loss of $6 million, or $0.08 per diluted share. Adjusted to exclude engineering integration costs, the company reported income of $12 million, or $0.16 diluted earnings per share.
Article printed from Aggregates Manager: http://www.aggman.com
URL to article: http://www.aggman.com/navistar-reports-first-quarter-results/
Copyright © 2009 Aggregates Manager. All rights reserved.