Navistar International announced its fourth quarter 2018 financial results, reporting a net income of $188 million, up $53 million from the same quarter last year.
For the whole fiscal year, Navistar reported a net income of $340 million, way up from just $30 million in net income for fiscal year 2017.
Fourth quarter adjusted EBITDA increased 20% to $322 million, compared to $268 million one year ago. Fiscal year 2018 adjusted EBITDA saw a 42% increase to $826 million from $582 million in 2017. Full-year adjusted EBITDA margins increased to 8.1% up from 6.8% for 2017. This marks the sixth consecutive year of annual growth in adjusted EBITDA on both a dollar and percentage basis for the company.
"2018 was a very strong year for the industry, and a breakout year for Navistar," said Troy Clarke, chairman, president and CEO. "We were the only truck OEM to grow Class 8 share during the year. With the industry's newest product lineup, superior quality, and a strong focus on customer uptime, we expect to gain market share in 2019 for the third year in a row."
Revenues in the quarter increased 28%, to $3.3 billion, compared to fourth quarter 2017. The revenue increase was largely driven by a 45% increase in the company's "Core" volumes, which represent its sales of Class 6-8 trucks and buses in the United States and Canada. For the Class 8 retail market alone, Navistar’s share grew to 13.5% in fiscal year 2018 versus 11.8% in fiscal year 2017.
For 2019, Navistar provided industry and financial guidance. The company expects retail deliveries of Class 6-8 trucks and buses in North America to be 295,000 to 425,000 units, with Class 8 truck deliveries making up 265,000 to 295,000 units. Revenues are expected to be between $10.75 billion and $11.25 billion and adjusted EBITDA is expected to be between $850 million and $900 million.
"While we expect 2019 to be another strong year for Navistar and the industry, it's important to recognize that Navistar as an investment is much more than just a cycle play," said Clarke. "As our ongoing improvements demonstrate, the company also has strong opportunities to benefit by recapturing market share, growing parts revenue, improving margins, generating free cash flow and further de-risking the balance sheet."