Navistar International elbowed its way into today's heavily booked earnings confessional to restate 3 years' worth of reports and announce its intentions to acquire General Motors' (GM) medium-duty truck business. For fiscal years 2003 through 2005, the firm recorded a negative adjustment of $1.12 billion, including $321 million to increase its warranty reserves. NAVZ also reported $874-million worth of income-tax adjustments for the 3-year period.
For fiscal 2003, NAVZ lost $4.92 per share and pulled in revenue of $7.71 billion. In 2004, the company lost 39 cents per share on $9.7 billion in revenue. The net per-share income for 2005 has yet to be determined, but revenue climbed again that year to reach $12.15 billion. Revenue is expected to reach $15 billion by fiscal 2009. NAVZ also stated that a number of material weaknesses have been identified in the company's internal finance protocol, and steps are being taken to address those faults. Today's restated reports are part of NAVZ's attempt to become compliant with Securities and Exchange Commission filing regulations and regain a stock listing on a major exchange.
Meanwhile, despite what it terms an extremely weak North American truck market, NAVZ said it's in talks to acquire GM's medium-duty truck business. Such a deal would give NAVZ the right to manufacture trucks under the GMC and Chevrolet brands, as well as service parts through GM's North American dealer network. This agreement would leverage Navistar's strengths in commercial trucks and engines, and advance its strategy to build scale and reduce costs, said Navistar.
NAVZ rose fractionally out of the gate this morning as investors attempt to digest this bevy of news and figures. The stock is currently holding firm to support from its 20-day moving average.