Navistar Posts Record Third Quarter Earnings

Navistar International Corp., Warrenville, Ill., reported record net income for the third quarter of $272 million, or $3.68 per diluted share; and revised full-year guidance upward.

"Increased military revenue as well as strong demand for our fuel-efficient heavy trucks drove our overall results in the third quarter," said Daniel C. Ustian, Navistar chairman, president and CEO. "Although we continue to face a weak truck market in North America and anticipate our results to moderate in the fourth quarter, we are revising our full-year guidance upward."

The company now projects net income for the year of between $467 million and $548 million, and diluted earnings per share of $6.35 to $7.45.

For the first nine months of fiscal 2008, the company reported net income of $434 million, or $5.92 per diluted share on net sales and revenue of $10.9 billion, compared to a net loss of $17 million, or a loss of 24 cents per diluted share on net sales and revenue of $9.1 billion reported in the first nine months of fiscal 2007. Manufacturing segment profit for the nine month period was up 159 percent to $837 million from $323 million reported in the first nine months of 2007.

"Our strategy to grow in non-traditional, expansionary markets and reduce cost continues to pay off," said Ustian. "We anticipate even greater returns as we develop our strategic alliances to expand our global footprint and leverage a broader supply base."

Third quarter truck shipments of expansionary and U.S. military units accounted for 40 percent of all Navistar worldwide truck shipments; continuing to offset the impact of the soft U.S and Canadian truck market. Navistar's share of order receipts in the traditional U.S. and Canada industry climbed for the third straight quarter, reaching 38 percent of total industry orders. Class 8 market share excluding U.S. military exceeded 21 percent for the third quarter on the strength of increased demand for the fuel-efficient International ProStar, according to the company.

Quarterly worldwide engine shipments decreased 27 percent to 79,300 due to reduced orders for diesel engines in Ford heavy-duty pickups. Engine shipments to other manufacturers and Navistar's own truck group increased 26 percent from the prior year. Intercompany engine shipments will increase as production of the new MaxxForce 11 and 13 Big-Bore engines, which started delivery in the third quarter, continue to ramp up. Engine shipments to other manufacturers are expected to grow due to the strength of the company's South American engine subsidiary that recently signed a long-term agreement to supply GM 420,000 units.