Losses Fall, Company Optimism Rises as Navistar Reports 4Q and 2015 Results
Navistar International Corp. reported lower net losses for its fourth quarter and 2015 fiscal year ended Oct. 31, and forecast it would improve on those trends and turn cash-flow positive and profitable in 2016.
For the quarter, Navistar lost $50 million or a diluted loss per share of 61 cents compared with a loss of $72 million or 88 cents a year earlier.
Revenue in the quarter fell to $2.5 billion, down from $3 billion a year earlier.
The company also said it has offered to pay a fine to settle a Securities and Exchange Commission investigation into the company’s disclosures about the departure of CEO Dan Ustian in 2012 and its strategy for reducing engine emissions. The company did not disclose details about the proposed settlement.
CEO Troy Clarke said during a conference call that the company with its Class 8 vehicles “was seeing a higher share of the wallet,” meaning customers “who may have bought 25 trucks now are buying 300.”
He said Class 8 orders were strong in December without giving an exact figure.
The company said it expects to launch a new HX Series, the PayStar replacement, in early 2016 for the construction and vocational markets. Also, over the next three years, Navistar will continue to update its product line, including the introduction of its ProStar replacement, the new LT series.
Sales of its used trucks slowed, in part, as export markets weakened, the company said.
Also, the earnings report said the company “recognized adjustments to pre-existing warranties [for its engines introduced to meet 2010 emissions standards and since recalled] of $1 million in 2015 compared to adjustments of $55 million in 2014 and $404 million in 2013.”
For the year, Navistar lost $184 million or $2.25 per share compared with a loss of $619 million or $7.60 in the 2014 period.
Revenue for the year slipped to $10.1 billion from $10.8 billion a year earlier.
