Navistar posts $12 mil loss as sales decline
Navistar International Corp., the maker of International-brand trucks, posted a $12 million third- quarter net loss, after analysts had estimated a profit, and cut its forecast for full-year earnings as sales slumped.
The loss was 16 cents a share, compared with net income of $331 million, or $4.47, a year earlier, company said in a statement today. Excluding a gain from buying assets from Monaco Coach Corp., the loss was 49 cents a share. The average of 10 analyst estimates compiled by Bloomberg was profit of 66 cents.
Navistar in June reduced its forecast for some classes of trucks and school buses in the U.S. and Canada, saying the economic recovery would take longer than expected. The company, based in Warrenville, reiterated that outlook today.
"We're looking through the rearview mirror at the worst quarter of one of the biggest downturns we have seen," said Stephen Volkmann, a Jefferies & Co. analyst in New York with a "buy" rating on the stock. "At the end of the day, they're still remaining pretty solidly profitable through this downturn."
Sales fell 37 percent to $2.51 billion for the quarter, which ended July 31.
The company said that for its fiscal year that ends in October, profit will be $2.55 to $2.85 a share excluding the effects of a settlement of a contract dispute with Ford Motor Co. In June, Navistar forecast earnings on that basis of $2.80 to $3.10. The average of 10 analyst estimates compiled by Bloomberg was for $2.93.
Navistar fell $2.38, or 5.2 percent, to $43.30 at 6:07 p.m. in trading after the close of the New York Stock Exchange. The shares had gained 13 cents to $45.68 at 4:15 p.m. in NYSE composite trading. They have more than doubled this year.
'Most Challenging Quarter'
"The third quarter is traditionally our most challenging quarter, but we remain focused on the long-term success of the company," Chief Executive Officer Daniel Ustian said in the statement. "Therefore, we elected not to implement drastic short-term cost cutting actions that would have impacted our ability to deliver long-term results."
The company said it had costs of $30 million in the quarter because it revised full-year tax estimates. Navistar didn't say what that per-share expense was.
The company and competitors including BAE Systems Plc on June 30 lost a bid to build blast-proof trucks for U.S. military use in Afghanistan to Oshkosh Corp. BAE plans to appeal the decision and Navistar filed a protest this month.