EX-99.1 16 dex991.htm ADDITIONAL FINANCIAL INFORMATION Additional Financial Information

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 consolidated financial statements in Item 8 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 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 (with financial services operations on a pre-tax equity basis)

 

     For the Year Ended October 31, 2009  
     Manufacturing
Operations
    Financial
Services
Operations
   Adjustments     Consolidated
Statement of
Operations
 
(in millions)                        

Sales of manufactured products, net

   $     11,300      $      $     —        $     11,300   

Finance revenues

     —              348      (79 )     269  
                               

Sales and revenues, net

     11,300        348      (79     11,569   
                               

Costs of products sold

     9,366        —        —          9,366   

Restructuring charges

     59        —        —          59   

Impairment of property and equipment

     31        —        —          31   

Selling, general and administrative expenses

     1,218        130      (4     1,344   

Engineering and product development costs

     433        —        —          433   

Interest expense

     99        162      (10     251   

Other (income) expense, net

     (179     16      (65     (228
                               

Total costs and expenses

     11,027        308      (79     11,256   

Equity in income of non-consolidated affiliates

     46        —        —          46   
                               

Income before income taxes, minority interest, extraordinary gain, and equity income from financial services operations

     319        40      —          359   

Equity income from financial services operations

     40        —        (40     —     
                               

Income before income taxes, minority interest, and extraordinary gain

     359        40      (40     359   

Income tax expense

     37        —        —          37   
                               

Income before minority interest and extraordinary gain

     322        40      (40     322   

Minority interest in net income of subsidiaries, net of tax

     (25     —        —          (25
                               

Income before extraordinary gain

     297        40      (40     297   

Extraordinary gain, net of tax

     23        —        —          23   
                               

Net income

   $ 320      $ 40    $ (40   $ 320   
                               

 

E-28


     For the Year Ended October 31, 2008
     Manufacturing
Operations
    Financial
Services
Operations
    Adjustments     Consolidated
Statement of
Operations
(in millions)                       

Sales of manufactured products, net

   $     14,399      $ —        $ —        $     14,399

Finance revenues

     —              405            (80     325
                              

Sales and revenues, net

     14,399        405        (80     14,724
                              

Costs of products sold

     11,942        —          —          11,942

Impairment of property and equipment

     358        —          —          358

Selling, general and administrative expenses

     1,292        149        (4     1,437

Engineering and product development costs

     384        —          —          384

Interest expense

     156        313        —          469

Other (income) expense, net

     123        (33     (76     14
                              

Total costs and expenses

     14,255        429        (80     14,604

Equity in income of non-consolidated affiliates

     71        —          —          71
                              

Income (loss) before income taxes and equity income from financial services operations

     215        (24     —          191

Equity loss from financial services operations

     (24     —          24        —  
                              

Income (loss) before income taxes

     191        (24     24        191

Income tax expense

     57        —          —          57
                              

Net income (loss)

   $ 134      $ (24   $ 24      $ 134
                              

 

E-29


     For the Year Ended October 31, 2007  
     Manufacturing
Operations
    Financial
Services
Operations
    Adjustments     Consolidated
Statement of
Operations
 
(in millions)                         

Sales of manufactured products, net

   $     11,910      $     —        $ —        $     11,910   

Finance revenues

     —          518            (133     385   
                                

Sales and revenues, net

     11,910        518        (133     12,295   
                                

Costs of products sold

     10,109        —          —          10,109   

Selling, general and administrative expenses

     1,380        113        (3     1,490   

Engineering and product development costs

     375        —          —          375   

Interest expense

     197        305        —          502   

Other (income) expense, net

     123        (27     (130     (34
                                

Total costs and expenses

     12,184        391        (133     12,442   

Equity in income of non-consolidated affiliates

     74        —          —          74   
                                

Income (loss) before income taxes, and equity income from financial services operations

     (200     127        —          (73

Equity income from financial services operations

     127        —          (127     —     
                                

Income (loss) before income taxes

     (73     127        (127     (73

Income tax expense

     47        —          —          47   
                                

Net income (loss)

   $ (120   $ 127      $ (127   $ (120
                                

 

E-30


Condensed Statements of Assets, Liabilities, Redeemable Equity Securities, and Stockholders’ Deficit

Navistar International Corporation (Manufacturing operations with financial services operations on a pre-tax equity basis)

 

     As of October 31, 2009  
     Manufacturing
Operations
    Financial
Services
Operations
   Adjustments     Consolidated
Balance Sheet
 
(in millions)                        

Cash and cash equivalents

   $     1,152      $ 60    $ —        $ 1,212   

Restricted cash and cash equivalents

     30        455      —          485   

Accounts receivables

     915        3,358      (188     4,085   

Inventories

     1,634        32      —          1,666   

Investments in and advances to financial services operations

     423        —        (423     —     

Investments in and advances to non-consolidated affiliates

     62        —        —          62   

Property and equipment, net

     1,345        122      —          1,467   

Goodwill and intangible assets, net

     582        —        —          582   

Deferred taxes, net

     102        57      —          159   

Other assets

     257        52      —          309   
                               

Total assets

   $ 6,502      $     4,136    $     (611   $     10,027   
                               

Accounts payable

   $ 1,929      $ 131    $ (188   $ 1,872   

Postretirement benefits liabilities

     2,635        33      —          2,668   

Debt

     1,975        3,431      —          5,406   

Other liabilities

     1,702        118      —          1,820   

Minority interest

     61        —        —          61   

Redeemable equity securities

     13        —        —          13   

Stockholders’ deficit

     (1,813     423      (423     (1,813
                               

Total liabilities, redeemable equity securities, and stockholders’ equity(deficit)

   $ 6,502      $ 4,136    $ (611   $ 10,027   
                               

 

E-31


     As of October 31, 2008  
     Manufacturing
Operations
    Financial
Services
Operations
   Adjustments     Consolidated
Balance Sheet
 
(in millions)                        

Cash and cash equivalents

   $ 775      $ 86    $ —        $ 861   

Restricted cash and cash equivalents

     8        549      —          557   

Accounts receivables

     1,051        3,951      (209     4,793   

Inventories

     1,584        44      —          1,628   

Investments in and advances to financial services operations

     387        7      (394     —     

Investments in and advances to non-consolidated affiliates

     156        —        —          156   

Property and equipment, net

     1,390        111      —          1,501   

Goodwill and intangible assets, net

     529        —        —          529   

Deferred taxes, net

     67        49      —          116   

Other assets

     177        72      —          249   
                               

Total assets

   $     6,124      $     4,869    $     (603   $     10,390   
                               

Accounts payable

   $ 2,162      $ 74    $ (209   $ 2,027   

Postretirement benefits liabilities

     1,726        18      —          1,744   

Debt

     1,834        4,240      —          6,074   

Other liabilities

     1,754        143      —          1,897   

Redeemable equity securities

     143        —        —          143   

Stockholders’ deficit

     (1,495     394      (394     (1,495
                               

Total liabilities, redeemable equity securities, and stockholders’ equity(deficit)

   $ 6,124      $ 4,869    $ (603   $ 10,390   
                               

 

E-32


Condensed Statements of Cash Activities

Navistar International Corporation (with financial services operations on a pre-tax equity basis)

 

     For the Year ended October 31, 2009  
     Manufacturing
Operations
    Financial
Services
Operations
    Adjustments     Condensed
Consolidated
Statement of
Cash Flows
 
(in millions)                         

Cash flows from operating activities

        

Net income

   $ 320      $ 40      $ (40   $ 320   

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

        

Depreciation and amortization

     290        14        —          304   

Depreciation of equipment leased to others

     35        21        —          56   

Deferred income taxes

     (14     (4     —          (18

Impairment of property and equipment, goodwill and intangibles

     41        —          —          41   

Extraordinary gain on acquisition of subsidiary

     (23     —          —          (23

Gain on increased equity interest in subsidiary

     (23     —          —          (23

Equity in income of non-consolidated affiliates

     (46     —          —          (46

Equity in income of financial services affiliates

     (40     —          40        —     

Dividends from non-consolidated affiliates

     59        —          —          59   

Other, net

     (85         633        —          548   
                                

Net cash provided by operating activities

     514        704        —          1,218   
                                

Cash flows from investing activities

        

Purchases of marketable securities

     (382     —          —          (382

Sales or maturities of marketable securities

     384        —          —          384   

Net change in restricted cash and cash equivalents

     (23     94        —          71   

Capital expenditures

     (148     (3     —          (151

Purchase of equipment leased to others

     (2     (44     —          (46

Business acquisitions, net of escrow receipt

     (60     —          —          (60

Other investing activities

     (51     3        20        (28
                                

Net cash provided by (used in) investing activities

     (282     50        20        (212
                                

Net cash used in financing activities

     56        (780     (20     (744
                                

Effect of exchange rate changes on cash and cash equivalents

     9        —          —          9   
                                

Decrease in cash and cash equivalents

     297        (26     —          271   

Increase in cash and cash equivalents upon consolidation of BDP and BDT

     80        —          —          80   
                                

Cash and cash equivalents at beginning of the period

     775        86        —          861   
                                

Cash and cash equivalents at end of the period

   $     1,152      $ 60      $     —        $     1,212   
                                

 

E-33


     For the Year ended October 31, 2008  
     Manufacturing
Operations
    Financial
Services
Operations
    Adjustments     Condensed
Consolidated
Statement of
Cash Flows
 
(in millions)                         

Cash flows from operating activities

        

Net income

   $ 134      $ (24   $ 24      $ 134   

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

        

Depreciation and amortization

     333        11        —          344   

Depreciation of equipment leased to others

     44        20        —          64   

Deferred income taxes

     82        (26     —          56   

Impairment of goodwill and intangibles

     372        —          —          372   

Equity in income of financial services affiliates

     24        —          (24     —     

Equity in income of non-consolidated affiliates

     (71     —          —          (71

Dividends from financial services operations

     25        —          (25     —     

Dividends from non-consolidated affiliates

     85        —          —          85   

Other, net

         (599     735        —          136   
                                

Net cash provided by operating activities

     429        716            (25         1,120   
                                

Cash flows from investing activities

        

Purchases of marketable securities

     (42     —          —          (42

Sales or maturities of marketable securities

     46        —          —          46   

Net change in restricted cash and cash equivalents

     7            (150     —          (143

Capital expenditures

     (168     (8     —          (176

Purchase of equipment leased to others

     —          (39     —          (39

Contributions to NFC

     (60     —          60        —     

Business acquisitions, net of escrow receipt

     —          —          —          —     

Other investing activities

     1        20        —          21   
                                

Net cash provided by (used in) investing activities

     (216     (177     60        (333
                                

Net cash used in financing activities

     (133     (508     (35     (676
                                

Effect of exchange rate changes on cash and cash equivalents

     (21     (6     —          (27
                                

Decrease in cash and cash equivalents

     59        25        —          84   

Cash and cash equivalents at beginning of the period

     716        61        —          777   
                                

Cash and cash equivalents at end of the period

   $ 775      $ 86      $ —        $ 861   
                                

 

E-34


     For the Year ended October 31, 2007  
     Manufacturing
Operations
    Financial
Services
Operations
    Adjustments     Condensed
Consolidated
Statement of
Cash Flows
 
(in millions)                         

Cash flows from operating activities

        

Net income

   $ (120   $ 127      $ (127   $ (120

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

        

Depreciation and amortization

     312        5        —          317   

Depreciation of equipment leased to others

     40        23        —          63   

Deferred income taxes

     39        (40     —          (1

Impairment of goodwill and intangibles

     —          —          —          —     

Equity in income of financial services affiliates

     (127     —          127        —     

Equity in income of non-consolidated affiliates

     (74     —          —          (74

Dividends from financial services operations

     400        —          (400     —     

Dividends from non-consolidated affiliates

     111        —          —          111   

Other, net

     (412     378        —          (34
                                

Net cash provided by operating activities

     169        493            (400     262   
                                

Cash flows from investing activities

        

Purchases of marketable securities

     (221     —          —          (221

Sales or maturities of marketable securities

     351        —          —          351   

Net change in restricted cash and cash equivalents

     24        257        —          281   

Capital expenditures

     (309     (3     —          (312

Purchase of equipment leased to others

     —          (37     —          (37

Business acquisitions, net of escrow receipt

     (7     —          —          (7

Contributions to NFC

     —          —          —          —     

Other investing activities

     92        10        —          102   
                                

Net cash provided by (used in) investing activities

     (70     227        —          157   
                                

Net cash used in financing activities

     (480     (726     400        (806
                                

Effect of exchange rate changes on cash and cash equivalents

     19        (12     —          7   
                                

Decrease in cash and cash equivalents

     (362     (18     —          (380

Cash and cash equivalents at beginning of the period

         1,078        79        —              1,157   
                                

Cash and cash equivalents at end of the period

   $ 716      $ 61      $ —        $ 777   
                                

 

E-35