Navistar Posts Record Second Quarter, First Half
May 22, 2000
Navistar International reported record earnings for the second quarter and first six months of its fiscal year.
Net income for the quarter ending April 30 was $98 million, up from $96 million a year earlier. Sales and revenues from manufacturing and financial services totaled $2.4 billion for the second quarter, up slightly from $2.3 billion in second quarter 1999. Manufacturing gross margins for the second quarter were 18%, up from 17.9% the same period in 1999.
Net income for the first six months of fiscal 2000 was $168 million, up from $157 million the first half of 1999. Sales and revenue was $4.6 billion versus $4.2 billion a year earlier.
Navistar Chairman, President and CEO John Horne said the record results came despite intense truck pricing competition that is expected to continue throughout the year. Despite an industry-wide decline in incoming heavy truck orders, actual industry sales volume in the first half held up well compared to last year’s record levels, he noted. However there was less growth in new truck pricing and a significant deterioration in used truck pricing that has negatively influenced trade-in values.
Worldwide shipments of International brand medium and heavy trucks and school buses totaled 35,900 units in second quarter, compared with 36,100 units shipped in second quarter 1999. Shipments of mid-range diesel engines to other original equipment manufacturers during the quarter totaled 83,200 units, up 15% from a year earlier.
Horne said plans for International’s next generation vehicle continue on schedule as does work on a new engine facility in Huntsville, AL, and a new school bus facility in Tulsa, OK. The new next generation medium truck will be available to customers next March, the company said.
Navistar is forecasting U.S. and Canada truck industry volume for fiscal 2000 at 405,000 units, down from 465,000 units in fiscal 1999. Demand for heavy trucks is expected to reach 245,000 units, while demand for medium trucks is estimated at 128,000 with school bus demand forecast at 32,000 units.