Truck and engine maker Navistar posted higher-than-expected quarterly profits

Article by Christian A., on September 9, 2010

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]

Topics: profit

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