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Navistar (NAV) Tumbles After Surprise Q2 Loss, Lowered Forecast

 June 07, 2012 09:00 AM

(By Balaseshan) Navistar International Corp. (NYSE:NAV) reported a loss for the second quarter due to lower revenue and higher costs. Second quarter results missed Street's expectations. Further, the company lowered its fiscal 2012 adjusted earnings guidance below Street's view, sending its shares down 11.19% in premarket.

Loss for the second quarter was $172 million or $2.50 per share, compared to a profit of $74 million or $0.93 per share last year. Adjusted loss was $137 million or $1.99 per share, compared to a profit of $102 million or $1.30 per share previous year.

Revenue declined $3.30 billion from $3.36 billion. Analysts had expected a profit of $0.67 per share on revenue of $3.63 billion.

[Related -Navistar International Corp (NYSE:NAV): Set To Benefit From Improving North American Truck Cycle]

Truck segment sales increased 4% due to increased volumes in traditional markets and strong volume in South America. Engine segment sales decreased by 6% due to lower sales volumes in South America and a pre-buy of pre-Euro V emissions engines in prior quarters.

Looking ahead into the fiscal 2012, the company lowered its adjusted earnings guidance to range of $0.00 to $2.00 per share from previous forecast of $4.25 to $5.25 per share, while Street predicts $3.73 per share. It also reduced adjusted profit outlook to range of breakeven to $140 million from previous estimate of $295 million to $365 million.

Additionally, the company announced a management realignment designed to give further momentum to its strategy of great products, competitive cost and profitable growth.

[Related -Stocks Tumble After BOJ Policy Decision; Navistar International Corp (NAV) Drops]

Troy Clarke, currently president of Navistar Asia Pacific, will assume responsibility for all Navistar's operations in the newly-created role of President, Truck and Engine.

Jack Allen will become president of North America Truck and Parts. The changes will take effect July 1, following Board approval.

NAV closed Wednesday's regular session up 2.29% at $28.15. The stock has been trading between $25.50 and $62.99 for the past 52 weeks.

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