Navistar loss widens as Ford engine orders decline

Navistar International Corp., the world's fourth-largest truckmaker, said its fourth-quarter loss widened because of impairment charges stemming from slumping demand for engines supplied to Ford Motor Co.

The net loss was $343 million, or $4.81 a share, compared with $103 million, or $1.46 a share, a year earlier, the Warrenville-based company said in a U.S. regulatory filing today. Sales for the period ended Oct. 31 rose 21 percent to $3.87 billion.

Navistar booked an impairment charge of $358 million after Ford cut orders for diesel engines, forcing the truckmaker to idle plants. Sales are unlikely to recover, it said. The charge eroded gains from rising military and overseas sales, which allowed the company to post a full-year profit compared with a year earlier loss.

Navistar's 2008 worldwide engine shipments fell 15 percent to 345,500, led by slumping demand for diesel engines for Ford heavy-duty pick-ups, the company said in a Business Wire statement, without elaboration. Ford's U.S. truck sales fell 23 percent in the first 11 months of 2008 as rising economic concerns damped demand for gas-guzzling vehicles.

Navistar's full-year revenue jumped 20 percent to $14.7 billion, including $3.5 billion of sales to the U.S. military. Net income totaled $134 million, or $1.82 a share, compared with a $120 million loss, or $1.70, a year earlier, it added.

The company today restated its earnings for the first three quarters of the year, increasing net income by a total of $43 million to $477 million. The company said on Dec. 24 that it expected the restatement to boost profit for the nine months by between $50 million and $70 million.

The restatement widened the first-quarter net loss to $65 million from the $53 million reported earlier, Navistar said in the filing. Second-quarter earnings declined to $211 million from $215 million and third-quarter net income increased to $331 million from $272 million, the company said.