Navistar Reports Record 4th Quarter Profits; $3.20 EPS for 2004 Exceeds Preliminary Figure Announced in December
WARRENVILLE, Ill.--Feb. 1, 20055, 2005--Navistar International Corporation , the nation's largest combined commercial truck and mid-range diesel engine producer, today reported that fourth quarter earnings totaled $159 million, equal to $2.02 per diluted common share. Consolidated sales and revenues for the quarter rose to $3.1 billion, from a restated $2.1 billion a year earlier.In the fourth quarter a year ago, the company earned a restated $36 million or $0.49 per diluted common share, which included a benefit of $22 million, equal to $0.28 per diluted common share from adjustment of restructuring charges.
The preliminary results were announced in December 2004. At that time, the company said earnings for the fourth quarter were expected to be at least $148 million, equal to $1.88 per diluted common share. Earnings for the full year were expected to be to at least $236 million, or $3.07 per diluted common share.
Both fourth quarter and full year earnings and sales and revenues figures exceeded the preliminary figures released in December 2004.
The company filed its Form 10-K for the fiscal year ended October 31, 2004 today. The document presented restated financial statements for the fiscal years of 2002 and 2003 and restated financial information for the first three quarters of 2004. The restatement reflects adjustments primarily related to accounting for the securitization of assets at the company's finance subsidiary and the consolidation of company-owned dealer organizations. A more detailed description of the restatement can be found in Navistar's Form 10-K that was filed today with the Securities and Exchange Commission and can be found at the company's website at http://www.nav-international.com.
Earnings for the full fiscal year ended October 31, 2004 totaled $247 million, or $3.20 per diluted common share, compared with a restated net loss of $21 million, equal to ($0.31) per diluted common share in fiscal 2003.
Sales and revenues for the year ended October 31, 2004, rose to $9.7 billion from a restated $7.6 billion a year earlier, marking the first time in the company's history that sales and revenues topped $9 billion.
Because of the restatement process, the filing of the company's Form 10-K was delayed and the company will also delay the announcement of its first quarter results until mid-March.
STATEMENT OF INCOME
Navistar International Corporation
and Consolidated Subsidiaries
-----------------------------------
For the Years Ended October 31
Millions of dollars, except share
data 2004 2003 2002
----------------------------------------------------------------------
As Restated As Restated
Sales and revenues
Sales of manufactured products $9,468 $7,282 $6,725
Finance revenue 245 283 276
Other income 11 20 20
----------- ----------- -----------
Total sales and revenues 9,724 7,585 7,021
----------- ----------- -----------
Costs and expenses
Cost of products and services sold 8,159 6,361 5,949
Cost of products sold related to
restructuring - 9 23
----------- ----------- -----------
Total cost of products and
services sold 8,159 6,370 5,972
Restructuring and other non-
recurring charges (1) (41) 521
Postretirement benefits expense 205 297 228
Engineering and research expense 245 242 260
Selling, general and administrative
expense 656 597 624
Interest expense 127 142 159
Other expense 22 27 29
----------- ----------- -----------
Total costs and expenses 9,413 7,634 7,793
----------- ----------- -----------
Income (loss) from continuing
operations before income taxes 311 (49) (772)
Income tax expense (benefit) 64 (32) (294)
----------- ----------- -----------
Income (loss) from continuing
operations 247 (17) (478)
Discontinued operations:
Loss from discontinued operations
(less applicable income taxes of
$0, $0 and $2, respectively) - - (14)
Loss on disposal - (4) (46)
----------- ----------- -----------
Loss from discontinued
operations - (4) (60)
----------- ----------- -----------
Net income (loss) $247 $(21) $(538)
=========== =========== ===========
----------------------------------------------------------------------
Basic earnings (loss) per share
Continuing operations $3.54 $(0.25) $(7.92)
Discontinued operations - (0.06) (1.00)
----------- ----------- -----------
Net income (loss) $3.54 $(0.31) $(8.92)
=========== =========== ===========
Diluted earnings (loss) per share
Continuing operations $3.20 $(0.25) $(7.92)
Discontinued operations - (0.06) (1.00)
----------- ----------- -----------
Net income (loss) $3.20 $(0.31) $(8.92)
=========== =========== ===========
Average shares outstanding
(millions)
Basic 69.7 68.0 60.3
Diluted 80.1 68.0 60.3
STATEMENT OF FINANCIAL CONDITION
Navistar International Corporation
and Consolidated Subsidiaries
----------------------------------
As of October 31
Millions of dollars 2004 2003
----------------------------------------------------------------------
As Restated
ASSETS
Current assets
Cash and cash equivalents $605 $467
Marketable securities 182 80
Receivables, net 1,215 932
Inventories 790 592
Deferred tax asset, net 207 183
Other assets 168 165
----------------- ----------------
Total current assets 3,167 2,419
Marketable securities 73 515
Finance and other receivables, net 1,222 891
Property and equipment, net 1,444 1,439
Investments and other assets 374 300
Prepaid and intangible pension
assets 73 66
Deferred tax asset, net 1,239 1,299
----------------- ----------------
Total assets $7,592 $6,929
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LIABILITIES AND SHAREOWNERS' EQUITY
Liabilities
Current liabilities
Notes payable and current
maturities of long-term debt $823 $254
Accounts payable, principally
trade 1,462 1,113
Other liabilities 965 905
----------------- ----------------
Total current liabilities 3,250 2,272
Debt: Manufacturing operations 1,258 993
Financial services operations 787 1,533
Postretirement benefits liability 1,382 1,433
Other liabilities 384 406
----------------- ----------------
Total liabilities 7,061 6,637
----------------- ----------------
Commitments and contingencies
Shareowners' equity
Series D convertible junior
preference stock 4 4
Common stock and additional paid in capital
(par value $0.10 per share, 75.3
million shares issued) 2,096 2,118
Retained earnings (deficit) (604) (833)
Accumulated other comprehensive loss (789) (778)
Common stock held in treasury, at cost
(5.3 million and 6.5 million
shares held) (176) (219)
----------------- ----------------
Total shareowners' equity 531 292
----------------- ----------------
Total liabilities and shareowners'
equity $7,592 $6,929
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