Earnings Watch: Navistar Third Quarter Loss Grows, Revenue Declines
Navistar International Corp. (NYSE: NAV) released fiscal third quarter financials on Thursday morning showing its losses grew in the third quarter of the year while revenue fell 18%, following news on Tuesday that Volkswagen is taking a minority interest in the Illinois-based company.
The truck and engine manufacturer reported a net loss of $34 million, or 42 cents per share, for the three months ending July 31, compared to a third quarter 2015 net loss of $28 million, or 34 cents per share, as it faced what it called “tougher market conditions, particularly in the heavy segment.”
Revenue fell to $2.1 billion from $2.5 billion a year earlier, which the company mainly attributed to lower year-over-year chargeouts in the company’s core markets, Class 6-8 trucks and buses in the U.S. and Canada, which was affected by softer industry conditions, primarily in the Class 8 market. (Chargeouts are typically defined as trucks that have been invoiced to customers, with units held in dealer inventory.)
A consensus forecast by analysts was expecting a loss of 14 cents per share with revenue of $2.18 billion.
Despite the wider loss, Navistar said it achieved $32 million in structural cost reductions during the third quarter, raising year-to-date structural savings to $145 million. Combined with product and purchasing cost savings, the company’s total year-to-date costs savings exceed $300 million.
Third quarter 2016 earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $96 million versus $106 million in the same period one year ago. This more recent quarter included $36 million in adjustments, including $19 million of pre-existing warranty charges and $17 million in asset impairments and restructuring costs, compared to adjustments of $23 million in the third quarter of 2015.
Excluding these items, adjusted EBITDA was $132 million in the third quarter 2016 compared to $129 million in the same period one …Read the rest of this story
