EX-99.2 3 d685976dex992.htm EX-99.2 EX-99.2
Q1 EARNINGS PRESENTATION
March 5, 2014
Exhibit 99.2

2
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Safe Harbor
Statement
Information provided and statements contained in this report that are not purely historical are forward-
looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended,
Section
21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements only speak as of the date of this report and the
Company assumes no obligation to update the information included
in this report. Such forward-
looking statements include information concerning our possible or assumed future results of
operations, including descriptions of our business strategy. These statements often include words such
as “believe,”
“expect,”
“anticipate,”
“intend,”
“plan,”
“estimate,”
or similar expressions. These
statements are not guarantees of performance or results and they
involve risks, uncertainties, and
assumptions. For a further description of these factors, see the
risk factors set forth in our filings with
the Securities and Exchange Commission, including our annual report on Form 10-K for the fiscal year
ended October 31, 2013.
Although we believe that these forward-looking statements are based on
reasonable assumptions, there are many factors that could affect
our actual financial results or results
of operations and could cause actual results to differ materially from those in the forward-looking
statements. All future written and oral forward-looking statements by us or persons acting on our
behalf are expressly qualified in their entirety by the cautionary statements contained or referred to
above. Except for our ongoing obligations to disclose material information as required by the federal
securities laws, we do not have any obligations or intention to release publicly any revisions to any
forward-looking statements to reflect events or circumstances in the future or to reflect the occurrence
of unanticipated events.

3
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Other Cautionary Notes
The financial information herein contains audited and unaudited information and has been
prepared by management in good faith and based on data currently
available to the
Company.
Certain non-GAAP measures are used in this presentation to assist the reader
in
understanding our core manufacturing business.
We believe this information is useful and
relevant to assess and measure the performance of our core manufacturing business as it
illustrates manufacturing performance without regard to selected
historical legacy costs
(i.e. pension and other postretirement costs). It also excludes financial services and other
items that may not be related to the core manufacturing business
or underlying results.
Management often uses this information to assess and measure the
underlying
performance of our operating segments.
We have chosen to provide this supplemental
information to investors, analysts, and other interested parties
to enable them to perform
additional analyses of operating results. The non-GAAP numbers are reconciled to the
most appropriate GAAP number in the appendix of this presentation.

NYSE: NAV
1    QUARTER 2014 RESULTS
Troy Clarke, President & CEO
*
*
*
*
*
*
*
*
*
*
*
*
ST

5
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Agenda
Q1 Overview
Troy Clarke
Financial Results
Walter Borst
Drive to Deliver Update
Jack Allen
Summary
Troy Clarke

6
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Transformation:
Guiding Principles & Priorities            
2013
2014
•
Leading Vehicle Uptime
•
Driving a Lean Enterprise
•
EBITDA Margin Expansion
•
Profitable Market Share
•
Quality
•
Cost
•
Sense of
Urgency
•
Great Products
•
Customer
Satisfaction
•
People
Turnaround:
•
Improve Quality
•
Hit our Launches
•
Deliver 2013 Plans
•
Sales Momentum

7
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
•
Continued to hit our cash guidance
•
Beat our Q1 adjusted EBITDA guidance
•
Engine restructuring
•
Focus on product and quality
•
Sales momentum
•
Continued structural cost savings
•
Pace of change will accelerate
1   Quarter Summary
st

NYSE: NAV
FINANCIAL RESULTS
Walter Borst, Executive Vice President & CFO
*
*
*
*
*
*
*
*
*
*
*
*

9
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Income Statement Summary
Note:
This slide contains non-GAAP information; please see the
REG G in appendix for a detailed reconciliation. 
(A)   Amounts attributable to Navistar International Corporation.
$ in millions, except per share
Quarters Ended
January 31
2014
2013
Traditional Chargeouts
11,500
13,100
Sales and Revenues
$
2,208
$
2,637
EBITDA
$
(110)
$
57
Income (Loss) from Continuing Operations, Net of Tax
(A)
(249)
(114)
Diluted Loss Per Share from Continuing Operations
(A)
$
(3.07)
$
(1.42)

10
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Q1 2014 Segment Results
Segment Results:
North America Truck
$
(207)
$
(101)
North America Parts
104
117
Global Operations
(33)
(10)
Financial Services
23
22
Quarters Ended
January 31
2014
2013

11
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Q1 2014 EBITDA vs. Guidance
$ in millions
Note:
This slide contains non-GAAP information; please see the
REG G in appendix for a detailed reconciliation. 
* Excluding pre-existing warranty and one-time items.

12
Q1 2014 Earnings –
3/5/2014
Q1 2014 Manufacturing Cash Update
$ in millions
* Cash balance includes marketable securities.
**Guidance as provided on 12/20/2013.
Note:
This slide contains non-GAAP information; please see the
REG G in appendix for a detailed reconciliation. 
Guidance**
Actual
4Q 2013 Manufacturing Cash Balance*
$1,523
$1,523
Consolidated EBITDA
(100)-(50)
(110)
Capex / Cash Interest / Pension & OPEB
Funding
(154)
(125)
Change in Net Working Capital / Debt
Payments / Other
(269)-(219)
(189)
1Q 2014 Manufacturing Cash Balance
$1,000 -
$1,100
$1,099

Q1 2014 Earnings –
3/5/2014
Q1 Manufacturing Cash Balances*
* Cash balance includes marketable securities.
Note:
This slide contains non-GAAP information; please see the
REG G in appendix for a detailed reconciliation. 
13
NYSE: NAV

14
Q1 2014 Earnings –
3/5/2014
Guidance: Q2 2014 Manufacturing Cash
$ in millions
* Cash balance includes marketable securities.
** Excluding one-time items and pre-existing warranty
Note:
This slide contains non-GAAP information; please see the
REG G in appendix for a detailed reconciliation. 
Q2 Manufacturing Cash Balances*
(millions)
Guidance
Q1 2014 Manufacturing Cash Balance*
$1,099
Consolidated EBITDA**
$25-$75
Capex/Cash Interest/Pension & OPEB Funding
($136)
Change in Net Working Capital/Debt Payments/Other
$12-$62
Q2 2014 Manufacturing Cash Balance*
$1,000-$1,100

15
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Long-term EBITDA Goals
4 Pronged Action Plan to Improve EBITDA
Volume
Material
Structural
Warranty
increase
cost savings
cost  savings
cost reductions
2013 Actual
2014
2015 Exiting &
Long-term
Class 6 -
8 & Bus industry
301,300
300 -
335,000
325 -
350,000
Class 6 -
8 & Bus combined market share
18%
21%
22 -
24%
Material cost
Decrease
5% decrease
Structural cost savings
$330 million
Additional
$175 million
< 10% of sales
Warranty expense
Decrease
4% decrease
EBITDA Margin
8 –
10 %

16
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
•
Adjusted
EBITDA
better
than
Q1
guidance
•
Manufacturing
cash
met
guidance
for
the
sixth
consecutive
quarter
•
Long-term
EBITDA
goals
on
track
Summing It Up

NYSE: NAV
DRIVE TO DELIVER
Jack Allen, Executive Vice President & COO

18
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Q1 Summary
•
Operational Progress
–
New SCR based products continue to improve
–
No new warranty news
•
2014 Outlook 
–
Class 8 industry of 220,000 to 230,000 retail sales
–
Navistar Market share goal of  21% Class 6-8

19
Q1 2014 Earnings –
3/5/2014
•
Class 6/7 retail market share at 22% in January and 17% for Q1 
•
Class 8 retail market share 18% in January and 14% for Q1
•
Combined share (including bus) 20% in January and 16% for Q1
•
February truck orders 67% above Q1 levels and March off to a good start
•
Class 6-8 backlog was up 56% year over year.
•
North America production expected to be up 25% to 30% in Q2 versus
Q1 and 20% to 25% year over year.
Market Share
NYSE: NAV

20
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
2014
American Truck Dealers’
Trucks of the Year
Industry Recognition
TerraStar 4x4
ProStar with Cummins ISX

21
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
•
Multiple steps to improve product line and cost structure
–
Introduced ISX and MaxxForce 13 SCR in all Class 8 trucks
–
Cummins ISB added to Class 6/7 trucks and school bus
–
Consolidated mid-range engine manufacturing
•
Addition of SCR to the MaxxForce 9/10, production begins
Summer 2014
•
Optimal blend of proprietary and purchased engines for future
Engine Restructuring

22
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
•
Used Truck: Strong performance in Q1
•
Manufacturing: Enterprise-wide lean initiatives
•
Global: Impacted by lower volumes in Brazil
Drive to Deliver Progress in Q1 2014

NYSE: NAV
SUMMARY
Troy Clarke, President & CEO
#
#
#
#
#
#
#
#

24
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
•
Class
8
industry
of
220,000
-
230,000
•
2014 Class 6-8 and Bus share to be 21%
•
Structural cost reductions of $175 million
•
Driving material cost reductions to offset cost of SCR
•
Additional $1,400 of cost takeout on 13 liter SCR entering 2015
•
Manufacturing
cost
savings
of
$50
-
$60
million
•
8-10% EBITDA run rate goal by end of 2015
2014 Milestones

NYSE: NAV
APPENDIX
#
#
#
#
#
#
#

26
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Navistar Financial Corporation
Highlights
•
Financial Services Segment profit of $23 million for Q1
•
Total U.S. financing availability of $744 million as of January 31, 2014
•
Debt/Equity Leverage of 2.4:1 as of January 31, 2014
Retail Notes
Bank Facility
•
$840 million facility ($500 million
revolver and $340 million term
loan matures in December 2016)
–
Funding for retail notes,
wholesale notes, retail accounts,
and dealer open accounts
•
On balance sheet
•
NFSC wholesale trust as of
January 2014
–
$950 million funding facility 
–
Variable portion matures
September 2014
–
Term portions mature January
2015 and September 2015
•
On balance sheet
•
Broader product offering
•
Enhanced ability to support large
fleets
•
Better access to less expensive
capital

27
Q1 2014 Earnings –
3/5/2014
A Leader in Several Commercial Vehicle Segments
Class 6/7
Medium-Duty
Retail
Market
Share:
Q1
2014:
17%
Q4
2013:
20%
Retail Market Share -
U.S. and Canada Class 6-8:
Class 8
Severe Service
Retail
Market
Share:
Q1
2014:
19%
Q4
2013:
20%
Class 8
Heavy
Retail
Market
Share:
Q1
2014:
12%
Q4
2013:
14%
Combined Class 8
Retail
Market
Share:
Q1 2014:     14%
Q4 2013:     16%
January 31,
2014
October 31,
2013
July 31,
2013
April 30,
2013
January 31,
2013
Traditional Markets (U.S. and Canada)
Class 6 and 7 medium trucks
17
%
20
%
24
%
26
%
25
%
Class 8 heavy trucks
12
%
14
%
12
%
12
%
11
%
Class 8 severe service trucks
19
%
20
%
18
%
22
%
26
%
Combined Class 8
trucks
14
%
16
%
14
%
15
%
14
%
NYSE: NAV

28
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Worldwide Truck Chargeouts
We define chargeouts as trucks that have been invoiced to customers. The units held in dealer inventory represent the principal difference between retail
deliveries
and
chargeouts.
This
table
summarizes
our
approximate
worldwide
chargeouts
from
our
continuing
operations.
We
define
our
“traditional”
markets
to
include
U.S.
and
Canada
School
bus
and
Class
6
through
8
medium
and
heavy
truck.
Our
“traditional”
markets
include
CAT-branded
units
sold
to
Caterpillar
under
our
North
America
supply
agreement.
(A)
The
units
in
the
first
quarter
of
2013
have
been
recast
to
include
all
militarized
units.
(B)
Includes
chargeouts
related
to
Blue
Diamond
Truck
("BDT")
of
2,400
units
and
2,300
units
during
the
first
quarter
of
2014
and
2013,
respectively.
(C)
In
the
first
quarter
of
2013,
chargeouts
excludes:
(i)
400
RV
towables
units,
which
was
related
to
the
Bison
Coach
trailer
business
sold
in
October
2013,
and
(ii)
200
units
related
to
Monaco
and
WCC,
both
of
which
have
been
classified
as
discontinued
operations.
Three Months Ended  January 31,
(in units)
2014
2013
Change
% Change
Traditional Markets (U.S. and Canada)
School buses
1,900
2,000
(100)
(5
)%
Class
6 and 7 medium trucks
3,200
4,100
(900)
(22
)%
Class
8 heavy trucks
4,500
4,600
(100)
(2
)%
Class
8 severe service trucks
1,900
2,400
(500)
(21
)%
Total Traditional markets
11,500
13,100
(1,600)
(12
)%
Military vehicles
(A)
—
300
(300)
(100
)%
Expansion markets
(B)
5,500
6,600
(1,100)
(17
)%
Total worldwide units
(C)
17,000
20,000
(3,000)
(15
)%
Combined Class 8 trucks
6,400
7,000
(600)
(9
)%

29
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Worldwide Engine Shipments
Three Months Ended 
January 31,
(in units)
2014
2013
Change
% Change
OEM sales-South America
21,700
25,700
(4,000)
(16)%
Intercompany sales
9,500
16,400
(6,900)
(42)%
Other OEM sales
1,500
1,900
(400)
(21)%
Total sales
32,700
44,000
(11,300)
(26)%
Engine
Shipments

30
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
U.S. and Canada Dealer Stock Inventory*
*Includes U.S. and Canada Class 4-8 and school bus inventory, but does not include U.S. IC Bus.
Excludes the US portion of IC Bus

31
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Frequently Asked Questions
Q1:
What is included in Corporate and Eliminations?
A:
The primary drivers of Corporate and Eliminations are Corporate SG&A, pension and OPEB expense (excluding amounts allocated
to the segments), annual incentive, manufacturing interest expense, and the elimination of intercompany sales and profit between
segments.
Q2:
What is included in your equity in loss of non-consolidated affiliates?
A:
Equity in loss of non-consolidated affiliates is derived from our ownership interests in partially-owned affiliates that are not
consolidated.
Q3:
What is your net income attributable to non-controlling interests?
A:
Net income attributable to non-controlling interests is the result of the consolidation of subsidiaries in which we do not own 100%,
and is primarily comprised of Ford's non-controlling interest in our Blue Diamond Parts joint venture.
Q4:
What are your expected 2014 and beyond pension funding requirements?
A:
Future
contributions
are
dependent
upon
a
number
of
factors,
principally
the
changes
in
values
of
plan
assets,
changes
in
interest
rates
and
the
impact
of
any
funding
relief
currently
under
consideration.
In
2013,
we
contributed
$165
million
to
meet
the
minimum
required
contributions
for
all
plans.
We
expect
to
contribute
$198
million
to
our
pension
plans
in
2014.
We
currently
expect
that
in
2015
through
2017,
the
company
will
be
required
to
contribute
at
least
$174
million
per
year
to
our
pension
plans,
depending
on
asset
performance
and
discount
rates.

32
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Frequently Asked Questions
Q5:
What is your expectation for future cash tax payments?
A:
Our
cash
tax
payments
will
remain
low
in
2014
and
will
gradually
increase
as
we
utilize
available
net
operating
losses
(NOLs)
and
tax
credits
in
the
future
years.
Q6:
What is the current balance of net operating losses as compared to other deferred tax assets?
A:
As
of
October
31,
2013
the
Company
has
deferred
tax
assets
for
U.S.
federal
NOLs
valued
at
$546
million,
state
NOLs
valued
at
$117
million,
and
foreign
NOLs
valued
at
$177
million,
for
a
total
undiscounted
cash
value
of
$840
million.
In
addition
to
NOLs,
the
Company
has
deferred
tax
assets
for
accumulated
tax
credits
of
$259
million
and
other
deferred
tax
assets
of
$1.8
billion
resulting
in
net
deferred
tax
assets
before
valuation
allowances
of
approximately
$2.9
billion.
Of
this
amount,
$2.7
billion
is
subject
to
a
valuation
allowance
at
the
end
of
FY2013.
Q7:
How does your FY 2014 Class 8 industry outlook compare to ACT Research?
A:
Reconciliation to ACT - Retail Sales
ACT*
CY to FY adjustment
Total (ACT comparable Class 8 to Navistar)
Reconciliation to ACT - Retail Sales
ACT*
CY to FY adjustment
Total (ACT comparable Class 8 to Navistar)
Navistar Industry Retail Deliveries Combined Class 8 Trucks
220,000
   
230,000
   
Navistar difference from ACT
19,442
     
9,442
       
*Source:  ACT N.A. Commercial Vehicle Outlook - February 2014
8.8%
4.1%
U.S. and Canadian Class 8 Truck Sales
2013
215,039
(2,358)
212,681
2014
244,500
(5,058)
239,442

33
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Frequently Asked Questions
Q8:
What is your manufacturing interest expense for Fiscal Year 2014?
A:
Manufacturing interest for 2014 is forecasted at approximately $270 million.
Q9:
What should we assume for capital expenditures in Fiscal Year 2014?
A:
Capital expenditures were $167 million for FY 2013, which is lower than our traditionally guided capital spending range of $200 to
$300 million for product development.  We expect capital expenditures of approximately $150 million in FY 2014.

34
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Outstanding Debt Balances
$ in millions
(in millions)
January
31,
2014
October
31,
2013
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017, net of unamortized discount of $4 for both periods
$
693
$
693
8.25%
Senior
Notes,
due
2021,
net
of
unamortized
discount
of
$22
for
both
periods
1,178
1,178
3.00% Senior Subordinated Convertible Notes, due 2014, net of unamortized discount of $19 and $26, respectively
551
544
4.50% Senior Subordinated Convertible Notes, due 2018, net of unamortized discount of $22 and $23, respectively
178
177
Debt of majority-owned dealerships
46
48
Financing arrangements and capital lease obligations
70
77
Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040
225
225
Promissory Note
18
20
Financed lease obligations
219
218
Other
34
39
Total Manufacturing operations debt
3,212
3,219
Less: Current portion
662
658
Net long-term Manufacturing operations debt
$
2,550
$
2,561
(in millions)
January
31,
2014
October
31,
2013
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through 2019
$
752
$
778
Bank
revolvers,
at
fixed
and
variable
rates,
due
dates
from
2014
through
2019
820
1,018
Commercial paper, at variable rates, program matures in 2015
22
21
Borrowings secured by operating and finance leases, at various rates, due serially through 2018
58
49
Total Financial Services operations debt
1,652
1,866
Less: Current portion
597
505
Net long-term Financial Services operations debt
$
1,055
$
1,361

35
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
SEC Regulation G Non-GAAP Reconciliation
The
financial
measures
presented
below
are
unaudited
and
not
in
accordance
with,
or
an
alternative
for,
financial
measures
presented
in
accordance
with
U.S.
generally
accepted
accounting
principles
(GAAP).
The
non-GAAP
financial
information
presented
herein
should
be
considered
supplemental
to,
and
not
as
a
substitute
for,
or
superior
to,
financial
measures
calculated
in
accordance
with
GAAP.
Manufacturing Segment Results:
We believe manufacturing segment results, which includes the segment results of our North America Truck, North America Parts, and Global Operations reporting
segments, provide meaningful information of our core manufacturing business and therefore we use it to supplement our GAAP reporting by identifying items that
may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance of our operating segments.
We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of
operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the below reconciliation, and to provide an additional
measure of performance.
Earnings
(loss)
Before
Interest,
Income
Taxes,
Depreciation,
and
Amortization
(“EBITDA”):
We define EBITDA as our consolidated net income (loss) from continuing operations attributable to Navistar International Corporation, net of tax, plus
manufacturing interest expense, income taxes, and depreciation and amortization. We believe EBITDA provides meaningful information to the performance of our
business and therefore we use it to supplement our GAAP reporting. We have chosen to provide this supplemental information to investors, analysts and other
interested
parties
to
enable
them
to
perform
additional
analyses
of
operating
results.
Adjusted EBITDA:
We believe that adjusted EBITDA, which excludes certain identified items that we do not considered to be part of our ongoing business, improves the comparability of
year to year results, and is representative of our underlying performance. Management uses this information to assess and measure the performance of our operating
segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional
analyses
of
operating
results,
to
illustrate
the
results
of
operations
giving
effect
to
the
non-GAAP
adjustments
shown
in
the
below
reconciliations,
and
to
provide
an
additional measure of performance.
Manufacturing Cash Flow and Manufacturing Cash, Cash Equivalents, and Marketable Securities:
Manufacturing
cash
flow
is
used
and
is
presented
to
aid
in
developing
an
understanding
of
the
ability
of
our
operations
to
generate
cash
for
debt
service
and
taxes,
as
well
as
cash
for
investments
in
working
capital,
capital
expenditures
and
other
liquidity
needs.
This
information
is
presented
as
a
supplement
to
the
other
data
provided
because
it
provides
information
which
we
believe
is
useful
to
investors
for
additional
analysis.
Our
manufacturing
cash
flow
is
prepared
with
marketable
securities
being
treated
as
a
cash
equivalent.
Manufacturing
cash,
cash
equivalents,
and
marketable
securities
represents
the
Company’s
consolidated
cash,
cash
equivalents,
and
marketable
securities
excluding
cash,
cash
equivalents,
and
marketable
securities
of
our
financial
services
operations.
We
include
marketable
securities
with
our
cash
and
cash
equivalents
when
assessing
our
liquidity
position
as
our
investments
are
highly
liquid
in
nature.
We
have
chosen
to
provide
this
supplemental
information
to
investors,
analysts
and
other
interested
parties
to
enable
them
to
perform
additional
analyses
of
operating
results,
to
illustrate
the
results
of
operations
giving
effect
to
the
non-GAAP
adjustments
shown
in
the
below
reconciliation,
and
to
provide
an
additional
measure
of
performance.

36
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
SEC Regulation G Non-GAAP Reconciliations
Manufacturing segment cash and cash equivalents and marketable securities reconciliation:
2012
2013
2014
(in millions)
Jan. 31,
Apr. 30
Jan. 31,
Apr. 30
Oct. 31,
Jan. 31,
Manufacturing Operations:
Cash and cash equivalents
$
418
$
364
$
438
$
465
$
727
$
503
Marketable securities
419
317
751
699
796
596
Manufacturing Cash and cash equivalents and Marketable securities
$
837
$
681
$
1,189
$
1,164
$
1,523
$
1,099
Financial Services Operations:
Cash and cash equivalents
$
70
$
36
$
59
$
40
$
28
$
46
Marketable securities
20
20
20
34
34
34
Financial Services Cash and cash equivalents and Marketable securities
$
90
$
56
$
79
$
74
$
62
$
80
Consolidated Balance Sheet
Cash and cash equivalents
$
488
$
400
$
497
$
505
$
755
$
549
Marketable securities
439
337
771
733
830
630
Consolidated Cash and cash equivalents and Marketable securities
$
927
$
737
$
1,268
$
1,238
$
1,585
$
1,179

37
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
SEC Regulation G Non-GAAP Reconciliations
Manufacturing segment cash and cash equivalents and marketable securities reconciliation:
2008
2009
2010
2011
(in millions)
Apr. 30
Jan. 31,
Apr. 30
Jan. 31,
Apr. 30
Jan. 31,
Apr. 30
Manufacturing Operations:
Cash and cash equivalents
$
591
$
433
$
594
$
618
$
455
$
372
$
361
Marketable securities
38
149
—
50
175
390
718
Manufacturing Cash and cash equivalents and Marketable
securities
$
629
$
582
$
594
$
668
$
630
$
762
$
1,079
Financial Services Operations:
Cash and cash equivalents
$
84
$
64
$
124
$
72
$
53
$
27
$
29
Marketable securities
—
—
—
—
—
20
20
Financial Services Cash and cash equivalents and Marketable
securities
$
84
$
64
$
124
$
72
$
53
$
47
$
49
Consolidated Balance Sheet
Cash and cash equivalents
$
675
$
497
$
718
$
690
$
508
$
399
$
390
Marketable securities
38
149
—
50
175
410
738
Consolidated Cash and cash equivalents and Marketable
securities
$
713
$
646
$
718
$
740
$
683
$
809
$
1,128

38
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
SEC Regulation G Non-GAAP Reconciliations
Earnings (loss) before interest, taxes, depreciation, and amortization ("EBITDA") reconciliation
Quarters Ended          
January 31,
(in millions)
2014
2013
Loss from continuing operations attributable to NIC, net of tax
(249)
(114)
Plus:
Depreciation and amortization expense
86
100
Manufacturing
interest
expense
(A)
65
56
Less:
Income tax benefit (expense)
12
(15)
EBITDA
$
(110)
$
57
Quarters Ended                 
January 31,
(in millions)
2014
2013
Interest expense
$
82
$
74
Less:
Financial
services
interest
expense
17
18
Manufacturing interest expense
$
65
$
56
Adjusted EBITDA reconciliation
:
(A)  Manufacturing interest expense is the net interest expense primarily generated for borrowings that support the manufacturing and
corporate operations, adjusted to eliminate intercompany interest expense with our Financial Services segment. The following table
reconciles Manufacturing interest expense to the consolidated interest expense:
(in millions)
Quarters Ended
January 31, 2013
EBITDA
(reconciled above)
$
(110)
Less significant items of:
Adjustments
to
pre-existing
warranties
(A)
$
52
Asset
impairments
charges
(B)
18
Restructuring charges
3
73
Adjusted EBITDA
$
(37)

39
NYSE: NAV
Q1 2014 Earnings –
3/5/2014
Significant Items Included Within Our Results
(A)
Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically
occur
when
claims
experience
deviates
from
historic
and
expected
trends.
Our
warranty
liability
is
generally
affected
by
component
failure
rates,
repair costs, and the timing of failures.
Future events and circumstances related to these factors could materially change our estimates and require
adjustments to our liability.
In addition, new product launches require a greater use of judgment in developing estimates until historical experience
becomes available.
(B)
In
the
first
quarter
of
2014,
the
Company
concluded
it
had
a
triggering
event
related
to
potential
sales
of
assets
requiring
assessment
of
impairment
for
certain intangible and long-lived assets in the North America Truck segment. As a result, the North America Truck segment recognized asset
impairment charges of $18 million.
(C)
In
the
first
quarter
of
2013,
the
North
America
Truck
segment
recognized
$25
million
of
charges
for
accelerated
deprecation,
which
consisted
of
$13
million
for
certain
assets
related
to
the
discontinuation
of
our
MaxxForce
15L
engine
and
$12
million
for
certain
assets
related
to
the
closure
of
our
Garland
Facility.
(D)
As
a
result
of
the
legal
settlement
with
Deloitte
and
Touche
LLP
in
December
2012,
the
Company
received
cash
proceeds
of
$35
million
in
the
first
quarter of 2013.
Quarter Ended           
January 31,           
(in millions)
2014
2013
Expense (income):
Adjustments
to
pre-existing
warranties
(A)
$
52
$
40
Asset
impairment
charges
(B)
18
—
Restructuring charges
3
2
Accelerated
depreciation
(C)
—
25
Legal
settlement
(D)
—
(35)
The above items did not have a material impact on taxes due to the valuation allowances on our U.S. deferred tax assets, which was established in the
fourth quarter of 2012.