Due to high sales of armored fighting vehicles to the US military, Navistar International Corp. was able to post higher-than-expected quarterly profits; however, its overall sales still fell short of forecasts.
The truck and engine maker said that its core commercial vehicle market is weak. This led the company to reduce its full-year sales forecast. Navistar revealed that some of the military sales it had expected to book this year would be deferred until 2011.
Its full-year earnings forecast signify a weaker-than-expected fiscal fourth quarter, which started on Aug. 1. Navistar said that sales of those products in the US and Canada grew by 7% from a year earlier in the fiscal third quarter, a sign that the industry is recovering from the recession.
However, Navistar considers the economic conditions to still be difficult. For the quarter, Navistar posted a profit of $137 million, or $1.83 a share. A year ago, it posted a loss of $12 million, or 16 cents a share. Sales increased by 28% to $3.2 billion.
On average, analysts predict that the company will have a profit of $1.47 a share on sales of $3.57 billion, according to Thomson Reuters I/B/E/S. Navistar slashed its full-year sales forecast to $12 billion, down from a previous forecast of $13.2 billion to $13.7 billion.
Navistar maintained its full-year earnings forecast of $2.75 to $3.25 a share and pledged to post a figure at the upper end of that range, saying it had "found other measures to stay within previously anticipated earnings guidance." [via autonews - sub. required]