EX-99.1 7 navex991.htm ADDITIONAL FINANCIAL INFORMATION (UNAUDITED) NAV EX.99.1


EXHIBIT 99.1
Additional Financial Information (Unaudited)
The following additional financial information is provided based upon the continuing interest of certain stockholders and creditors to assist them in understanding our core manufacturing business with our financial services operations on a pre-tax equity basis. Our manufacturing operations, for this purpose, include our Truck segment, Engine segment, Parts segment, and Corporate items. The manufacturing operations financial information represents non-GAAP financial measures. The reconciling differences between these non-GAAP financial measures and our GAAP condensed consolidated financial statements in Item 1, Financial Statements, are our financial services operations, which are included on a pre-tax equity basis. Certain of our subsidiaries in our manufacturing operations have debt outstanding with our financial services operations (“intercompany debt”). In the condensed statements of assets, liabilities, redeemable equity securities, and stockholders' deficit, the intercompany debt is reflected as accounts payable. The change in the intercompany debt is reflected in the net cash provided by operating activities in the condensed statements of cash activities.

Condensed Statements of Revenues and Expenses
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)


 
Three Months Ended April 30, 2011
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
(in millions)
 


 


 


 


Sales of manufactured products
 
$
3,298

 
$

 
$

 
$
3,298

Finance revenues
 

 
83

 
(26
)
 
57

Sales and revenues, net
 
3,298

 
83

 
(26
)
 
3,355

Costs of products sold
 
2,701

 

 

 
2,701

Restructuring charges
 
2

 

 

 
2

Selling, general and administrative expenses
 
334

 
21

 
(1
)
 
354

Engineering and product development costs
 
137

 

 

 
137

Interest expense
 
38

 
26

 
(2
)
 
62

Other expenses (income), net
 
17

 
(4
)
 
(23
)
 
(10
)
Total costs and expenses
 
3,229

 
43

 
(26
)
 
3,246

Equity in loss of non-consolidated affiliates
 
16

 

 

 
16

Income before income taxes and equity income from financial services operations
 
53

 
40

 

 
93

Equity income from financial services operations
 
40

 

 
(40
)
 

Income before income taxes
 
93

 
40

 
(40
)
 
93

Income tax expense
 
5

 

 

 
5

Net income
 
88

 
40

 
(40
)
 
88

Less: Income attributable to non-controlling interests
 
14

 

 

 
14

Net income attributable to Navistar International Corporation
 
$
74

 
$
40

 
$
(40
)
 
$
74











E-6



Condensed Statement of Revenues and Expenses
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
Six Months Ended April 30, 2011
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
(in millions)
 
 
 
 
 
 
 
 
Sales of manufactured products
 
$
5,991

 
$

 
$

 
$
5,991

Finance revenues
 

 
156

 
(49
)
 
107

Sales and revenues, net
 
5,991

 
156

 
(49
)
 
6,098

Costs of products sold
 
4,900

 

 

 
4,900

Restructuring charges
 
23

 
1

 

 
24

Selling, general and administrative expenses
 
636

 
38

 
(2
)
 
672

Engineering and product development costs
 
266

 

 

 
266

Interest expense
 
74

 
56

 
(5
)
 
125

Other expenses (income), net
 
32

 
(11
)
 
(42
)
 
(21
)
Total costs and expenses
 
5,931

 
84

 
(49
)
 
5,966

Equity in loss of non-consolidated affiliates
 
33

 

 

 
33

Income before income taxes and equity income from financial services operations
 
27

 
72

 

 
99

Equity income from financial services operations
 
72

 

 
(72
)
 

Income before income taxes
 
99

 
72

 
(72
)
 
99

Income tax expense
 
5

 

 

 
5

Net income
 
94

 
72

 
(72
)
 
94

Less: Income attributable to non-controlling interests
 
26

 

 

 
26

Net income attributable to Navistar International Corporation
 
$
68

 
$
72

 
$
(72
)
 
$
68



E-7



Condensed Statement of Revenues and Expenses
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
Three Months Ended April 30, 2010 (Revised)(A)
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
(in millions)
 
 
 
 
 
 
 
 
Sales of manufactured products
 
$
2,690

 
$

 
$

 
$
2,690

Finance revenues
 

 
76

 
(23
)
 
53

Sales and revenues, net
 
2,690

 
76

 
(23
)
 
2,743

Costs of products sold
 
2,189

 

 

 
2,189

Restructuring charges
 

 
3

 

 
3

Selling, general and administrative expenses
 
325

 
34

 

 
359

Engineering and product development costs
 
116

 

 

 
116

Interest expense
 
37

 
29

 
(2
)
 
64

Other expenses (income), net
 
(20
)
 
(6
)
 
(21
)
 
(47
)
Total costs and expenses
 
2,647

 
60

 
(23
)
 
2,684

Equity in loss of non-consolidated affiliates
 
13

 

 

 
13

Income before income taxes and equity income from financial services operations
 
30

 
16

 

 
46

Equity income from financial services operations
 
16

 

 
(16
)
 

Income before income taxes
 
46

 
16

 
(16
)
 
46

Income tax benefit
 
10

 

 

 
10

Net income
 
56

 
16

 
(16
)
 
56

Less: Income attributable to non-controlling interests
 
13

 

 

 
13

Net income attributable to Navistar International Corporation
 
$
43

 
$
16

 
$
(16
)
 
$
43

_________________
(A)
Certain amounts have been revised to reflect a retrospective change in accounting principle. See Note 1, Summary of significant accounting policies, to the accompanying consolidated financial statements.


E-8



Condensed Statement of Revenues and Expenses
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)
 
 
Six Months Ended April 30, 2010 (Revised)(A)
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
(in millions)
 
 
 
 
 
 
 
 
Sales of manufactured products
 
$
5,448

 
$

 
$

 
$
5,448

Finance revenues
 

 
151

 
(47
)
 
104

Sales and revenues, net
 
5,448

 
151

 
(47
)
 
5,552

Costs of products sold
 
4,451

 

 

 
4,451

Restructuring charges (benefit)
 
(17
)
 
3

 

 
(14
)
Selling, general and administrative expenses
 
629

 
69

 
(3
)
 
695

Engineering and product development costs
 
225

 

 

 
225

Interest expense
 
76

 
61

 
(6
)
 
131

Other expenses (income), net
 
7

 
(10
)
 
(38
)
 
(41
)
Total costs and expenses
 
5,371

 
123

 
(47
)
 
5,447

Equity in loss of non-consolidated affiliates
 
19

 

 

 
19

Income before income taxes and equity income from financial services operations
 
58

 
28

 

 
86

Equity income from financial services operations
 
28

 

 
(28
)
 

Income before income taxes
 
86

 
28

 
(28
)
 
86

Income tax benefit
 
2

 

 

 
2

Net income
 
88

 
28

 
(28
)
 
88

Less: Income attributable to non-controlling interests
 
26

 

 

 
26

Net income attributable to Navistar International Corporation
 
$
62

 
$
28

 
$
(28
)
 
$
62

_________________
(A)
Certain amounts have been revised to reflect a retrospective change in accounting principle. See Note 1, Summary of significant accounting policies, to the accompanying consolidated financial statements.

E-9



Condensed Statements of Assets, Liabilities, and Stockholders' Deficit
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
As of April 30, 2011 
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
(in millions)
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
361

 
$
29

 
$

 
$
390

Marketable securities
 
718

 
20

 

 
738

Restricted cash and cash equivalents
 
28

 
160

 

 
188

Finance and other receivables, net
 
1,096

 
3,140

 
(208
)
 
4,028

Inventories
 
1,710

 
11

 

 
1,721

Goodwill
 
337

 

 

 
337

Property and equipment, net
 
1,368

 
118

 

 
1,486

Investments in and advances to financial services operations
 
558

 

 
(558
)
 

Investments in non-consolidated affiliates
 
103

 

 

 
103

Deferred taxes, net
 
71

 
39

 

 
110

Other assets
 
829

 
36

 

 
865

Total assets
 
$
7,179

 
$
3,553

 
$
(766
)
 
$
9,966

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
 
Accounts payable
 
$
2,087

 
$
28

 
$
(208
)
 
$
1,907

Debt
 
1,969

 
2,854

 

 
4,823

Postretirement benefits liabilities
 
2,030

 
34

 

 
2,064

Other liabilities
 
1,773

 
79

 

 
1,852

Total liabilities
 
7,859

 
2,995

 
(208
)
 
10,646

Redeemable equity securities
 
5

 

 

 
5

Convertible debt
 
84

 

 

 
84

Stockholders' equity attributable to non-controlling interest
 
43

 

 

 
43

Stockholders' equity (deficit) attributable to controlling interest
 
(812
)
 
558

 
(558
)
 
(812
)
Total liabilities and stockholders' equity (deficit)
 
$
7,179

 
$
3,553

 
$
(766
)
 
$
9,966


E-10



Condensed Statements of Assets, Liabilities, and Stockholders' Deficit
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
As of October 31, 2010 
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
(in millions)
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
534

 
$
51

 
$

 
$
585

Marketable securities
 
566

 
20

 

 
586

Restricted cash and cash equivalents
 
29

 
151

 

 
180

Finance and other receivables, net
 
1,030

 
3,084

 
(168
)
 
3,946

Inventories
 
1,556

 
12

 

 
1,568

Goodwill
 
324

 

 

 
324

Property and equipment, net
 
1,329

 
113

 

 
1,442

Investments in and advances to financial services operations
 
502

 

 
(502
)
 

Investments in non-consolidated affiliates
 
103

 

 

 
103

Deferred taxes, net
 
109

 
37

 

 
146

Other assets
 
821

 
29

 

 
850

Total assets
 
$
6,903

 
$
3,497

 
$
(670
)
 
$
9,730

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
 
Accounts payable
 
$
1,974

 
$
21

 
$
(168
)
 
$
1,827

Debt
 
1,985

 
2,885

 

 
4,870

Postretirement benefits liabilities
 
2,145

 
34

 

 
2,179

Other liabilities
 
1,723

 
55

 

 
1,778

Total liabilities
 
7,827

 
2,995

 
(168
)
 
10,654

Redeemable equity securities
 
8

 

 

 
8

Stockholders' equity attributable to non-controlling interest
 
49

 

 

 
49

Stockholders' equity (deficit) attributable to controlling interest
 
(981
)
 
502

 
(502
)
 
(981
)
Total liabilities and stockholders' equity (deficit)
 
$
6,903

 
$
3,497

 
$
(670
)
 
$
9,730



E-11



Condensed Statement of Cash Activity
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
Six Months Ended April 30, 2011 
 
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Condensed Consolidated Statement of Cash Flows
(in millions)
 
 
 
 
 
 
 
 
Cash flows from operating activities
 
 
 
 
 
 
 
 
Net income
 
$
94

 
$
72

 
$
(72
)
 
$
94

Adjustments to reconcile net income to cash provided by operating activities:
 


 


 


 


Depreciation and amortization
 
141

 
2

 

 
143

Depreciation of equipment leased to others
 
7

 
11

 

 
18

Amortization of debt issuance costs and discount
 
14

 
8

 

 
22

Deferred income taxes
 
(4
)
 
(1
)
 

 
(5
)
Equity in loss of non-consolidated affiliates
 
33

 

 

 
33

Equity in income of financial services affiliates
 
(72
)
 

 
72

 

Dividends from non-consolidated affiliates
 
2

 

 

 
2

Change in intercompany receivables and payables
 
41

 
(41
)
 

 

Other, net
 
(84
)
 
3

 

 
(81
)
Net cash provided by operating activities
 
172

 
54

 

 
226

Cash flows from investing activities
 
 
 
 
 
 
 


Purchases of marketable securities
 
(721
)
 

 

 
(721
)
Sales or maturities of marketable securities
 
569

 

 

 
569

Net change in restricted cash and cash equivalents
 

 
(8
)
 

 
(8
)
Capital expenditures
 
(185
)
 

 

 
(185
)
Purchase of equipment leased to others
 
(1
)
 
(22
)
 

 
(23
)
Other investing activities
 
(10
)
 
4

 

 
(6
)
Net cash used in investing activities
 
(348
)
 
(26
)
 

 
(374
)
Net cash used in financing activities
 
(5
)
 
(53
)
 

 
(58
)
Effect of exchange rate changes on cash and cash equivalents
 
8

 
3

 

 
11

Decrease in cash and cash equivalents
 
(173
)
 
(22
)
 

 
(195
)
Cash and cash equivalents at beginning of the period
 
534

 
51

 

 
585

Cash and cash equivalents at end of the period
 
$
361

 
$
29

 
$

 
$
390



E-12



Condensed Statement of Cash Activity
Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 
 
Six Months Ended April 30, 2010 (Revised)(A)
 
 
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Condensed Consolidated Statement of Cash Flows
(in millions)
 
 
 
 
 
 
 
 
Cash flows from operating activities
 
 
 
 
 
 
 
 
Net income
 
$
88

 
$
28

 
$
(28
)
 
$
88

Adjustments to reconcile net income to cash provided by (used in) operating activities:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
129

 
3

 

 
132

Depreciation of equipment leased to others
 
14

 
12

 

 
26

Amortization of debt issuance costs and discount
 
13

 
7

 

 
20

Deferred income taxes
 
6

 
5

 

 
11

Equity in loss of non-consolidated affiliates
 
19

 

 

 
19

Equity in income of financial services affiliates
 
(28
)
 

 
28

 

Dividends from non-consolidated affiliates
 
3

 

 

 
3

Change in intercompany receivables and payables
 
(154
)
 
154

 

 

Other, net
 
(397
)
 
364

 

 
(33
)
Net cash provided by (used in) operating activities
 
(307
)
 
573

 

 
266

Cash flows from investing activities
 
 
 
 
 
 
 
 
Purchases of marketable securities
 
(663
)
 

 

 
(663
)
Sales or maturities of marketable securities
 
488

 

 

 
488

Net change in restricted cash and cash equivalents
 
1

 
200

 

 
201

Capital expenditures
 
(77
)
 
(1
)
 

 
(78
)
Purchase of equipment leased to others
 
(2
)
 
(23
)
 

 
(25
)
Acquisition of intangibles
 
(11
)
 

 

 
(11
)
Business acquisitions
 
(2
)
 

 

 
(2
)
Other investing activities
 
(54
)
 
4

 

 
(50
)
Net cash provided by (used in) investing activities
 
(320
)
 
180

 

 
(140
)
Net cash used in financing activities
 
(66
)
 
(761
)
 

 
(827
)
Effect of exchange rate changes on cash and cash equivalents
 
(4
)
 
1

 

 
(3
)
Decrease in cash and cash equivalents
 
(697
)
 
(7
)
 

 
(704
)
Cash and cash equivalents at beginning of the period
 
1,152

 
60

 

 
1,212

Cash and cash equivalents at end of the period
 
$
455

 
$
53

 
$

 
$
508

_________________
(A)
Certain amounts have been revised to reflect a retrospective change in accounting principle. See Note 1, Summary of significant accounting policies, to the accompanying consolidated financial statements.


E-13