Navistar posts $247M fiscal 3Q loss
LISLE, Ill. (AP) — Navistar fell to a third-quarter loss as weak demand for big trucks dragged on North America operations.
The company said Wednesday that it has begun job cuts that will affect about 500 salaried and long-term contract employees.
The company began major cost-reduction initiatives last year and said new job cuts, expected to be completed by the end of the fiscal year, would save between $50 million and $60 million annually starting in fiscal 2014.
"We clearly need to accelerate progress with our financial results, and we are already implementing additional cost reduction and business improvement actions to counter our near-term volume challenges," said CEO Troy Clarke. "This includes resizing our company to match our current business environment."
Navistar posted a $247 million third-quarter loss, which was worse than Wall Street had expected. Shares fell 4 percent to $32.63 in early trading.
For the quarter ended July 31, the commercial truck and engine maker's loss amounted to $3.06 per share and compared with a profit of $84 million, or $1.22 per share, in the same quarter of 2012.
The year-ago period's results were boosted by a $188 million tax benefit stemming from a change in the company's tax rate.
Excluding discontinued operations, the company's loss for the recent quarter totaled $2.94 per share.
Revenue fell 12 percent to $2.86 billion from $3.25 billion.
Navistar International Inc. attributed the drop in revenue to lower sales volumes at its North America truck business stemming from a transition to new products featuring updated emissions reduction technology and lower industry wide demand.
That drop was partially offset by a $36 million reduction in engineering and product development costs and $14 million in lower selling, general and administrative expenses, the company said.