Truck and engine maker Navistar has reported net income for the first fiscal quarter ended 31 January, 2011 of US$12mn, or $0.16 diluted earnings per share, excluding the impact of costs to integrate its truck and engine engineering operation. Including those costs, the net loss was $6mn ($0.08 a share).
Earnings from operations were in line with full year expectations. Bolstered by the beginning of a solid recovery in its traditional North American markets, the company reaffirmed its guidance with a bias toward the higher end.
Navistar booked a $2m profit, or $0.03 a share, in the first quarter a year ago, adjusted to exclude the impact of benefits from the Ford restructuring and related activity. Including the restructuring benefit, first quarter 2010 earnings were $19m, $0.26 per share.
Sales and revenues for the 2011 first quarter were $2.7bn, compared with $2.8bn a year earlier.
Analysts on average had expected earnings of 23 cents a share, before special items, on revenue of $2.9 billion, according to Thomson Reuters I/B/E/S.
“We have significantly raised truck production schedules by up to 40% on various models to reflect increasing order activity. And, overall, we remain confident that we can deliver upon our commitments while still investing in our global business,” said Navistar chief Daniel Ustian.
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“We see positive signs across all of our businesses. We believe industry volumes should be at the higher end of our range, military revenue will approach $2bn, global volumes are expanding and so far we have contained challenges in commodity costs. Such that, we believe we can deliver results toward the higher side of our guidance.”
Navistar has previously forecast full year net income between $388mn and $465m, ($5 to $6 per share), excluding transition costs associated with the integration of the truck and engine engineering operation.
The company anticipates that total truck industry retail sales volume for Class 6-8 trucks and school buses in the United States and Canada for the fiscal year will be 260,000 units. Truck industry volume in fiscal 2010 was 191,300 units.
The company also said its military business is on target to achieve revenue of $2bn for the year as Navistar Defense continues to win orders and fill its order backlog.
The company’s global strategy is unfolding as planned and the company, through its NC2 and Mahindra joint ventures, is currently producing and selling commercial truck products in India, Brazil, South Africa and Australia. Navistar spent $27m on global expansion with NC2 and Mahindra in the first quarter.