Attached files
| file | filename |
|---|---|
| 10-Q - 10-Q - NAVISTAR INTERNATIONAL CORP | nav10q2020q2.htm |
| EX-32.2 - EXHIBIT 32.2 - NAVISTAR INTERNATIONAL CORP | navex3224302020.htm |
| EX-32.1 - EXHIBIT 32.1 - NAVISTAR INTERNATIONAL CORP | navex3214302020.htm |
| EX-31.2 - EXHIBIT 31.2 - NAVISTAR INTERNATIONAL CORP | navex3124302020.htm |
| EX-31.1 - EXHIBIT 31.1 - NAVISTAR INTERNATIONAL CORP | navex3114302020.htm |
| EX-10 - EXHIBIT 10 - NAVISTAR INTERNATIONAL CORP | navex104302020.htm |
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 operations and our Financial Services operations on an after-tax equity basis. Our Manufacturing operations, for this purpose, include our Truck segment, Parts segment, Global Operations segment, and Corporate items. The Manufacturing operations financial information represents non-GAAP financial measures. These non-GAAP financial measures should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP. The reconciling differences between these non-GAAP financial measures and our U.S. GAAP condensed consolidated financial statements in Item 1, Financial Statements, are our Financial Services operations, which are included on an after-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' equity (deficit), the intercompany debt is reflected as accounts payable. The change in the intercompany debt is reflected in Net cash provided by (used in) operating activities in the condensed statements of cash activity.
Condensed Statements of Revenues and Expenses
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
For the Three Months Ended April 30, 2020 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Statement of Operations | |||||||||||
Sales of manufactured products | $ | 1,877 | $ | — | $ | — | $ | 1,877 | |||||||
Finance revenues | — | 64 | (16 | ) | 48 | ||||||||||
Sales and revenues, net | 1,877 | 64 | (16 | ) | 1,925 | ||||||||||
Costs of products sold | 1,624 | — | — | 1,624 | |||||||||||
Asset impairment charges | 13 | — | — | 13 | |||||||||||
Selling, general and administrative expenses | 146 | 27 | (3 | ) | 170 | ||||||||||
Engineering and product development costs | 78 | — | — | 78 | |||||||||||
Interest expense | 44 | 20 | (1 | ) | 63 | ||||||||||
Other expense (income), net | 21 | (7 | ) | (12 | ) | 2 | |||||||||
Total costs and expenses | 1,926 | 40 | (16 | ) | 1,950 | ||||||||||
Equity in loss of non-consolidated affiliates | (1 | ) | — | — | (1 | ) | |||||||||
Income (loss) before equity income from financial services operations and income taxes | (50 | ) | 24 | — | (26 | ) | |||||||||
Equity income from financial services operations | 19 | — | (19 | ) | — | ||||||||||
Income (loss) before income tax | (31 | ) | 24 | (19 | ) | (26 | ) | ||||||||
Income tax expense | (2 | ) | (5 | ) | — | (7 | ) | ||||||||
Net income (loss) | (33 | ) | 19 | (19 | ) | (33 | ) | ||||||||
Less: Net income attributable to non-controlling interests | 5 | — | — | 5 | |||||||||||
Net income (loss) attributable to Navistar International Corporation | $ | (38 | ) | $ | 19 | $ | (19 | ) | $ | (38 | ) | ||||
E-6
For the Six Months Ended April 30, 2020 | ||||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Statement of Operations | ||||||||||||
Sales of manufactured products | $ | 3,671 | $ | — | $ | — | $ | 3,671 | ||||||||
Finance revenues | — | 121 | (29 | ) | 92 | |||||||||||
Sales and revenues, net | 3,671 | 121 | (29 | ) | 3,763 | |||||||||||
Costs of products sold | 3,153 | — | — | 3,153 | ||||||||||||
Restructuring charges | 1 | — | — | 1 | ||||||||||||
Asset impairment charges | 13 | — | — | 13 | ||||||||||||
Selling, general and administrative expenses | 302 | 55 | (5 | ) | 352 | |||||||||||
Engineering and product development costs | 164 | — | — | 164 | ||||||||||||
Interest expense | 90 | 39 | (1 | ) | 128 | |||||||||||
Other expense (income), net | 50 | (14 | ) | (23 | ) | 13 | ||||||||||
Total costs and expenses | 3,773 | 80 | (29 | ) | 3,824 | |||||||||||
Equity in loss of non-consolidated affiliates | (2 | ) | — | — | (2 | ) | ||||||||||
Income (loss) before equity income from financial services operations and income taxes | (104 | ) | 41 | — | (63 | ) | ||||||||||
Equity income from financial services operations | 32 | 24 | — | (32 | ) | — | ||||||||||
Income (loss) before income tax | (72 | ) | 41 | (32 | ) | (63 | ) | |||||||||
Income tax benefit (expense) | 7 | (9 | ) | — | (2 | ) | ||||||||||
Net income (loss) | (65 | ) | 32 | (32 | ) | (65 | ) | |||||||||
Less: Net income attributable to non-controlling interests | 9 | — | — | 9 | ||||||||||||
Net income (loss) attributable to Navistar International Corporation | $ | (74 | ) | $ | 32 | $ | (32 | ) | $ | (74 | ) | |||||
E-7
Condensed Statements of Revenues and Expenses
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
For the Three Months Ended April 30, 2019 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Statement of Operations | |||||||||||
Sales of manufactured products | $ | 2,948 | $ | — | $ | — | $ | 2,948 | |||||||
Finance revenues | — | 78 | (30 | ) | 48 | ||||||||||
Sales and revenues, net | 2,948 | 78 | (30 | ) | 2,996 | ||||||||||
Costs of products sold | 2,493 | — | — | 2,493 | |||||||||||
Restructuring charges | 1 | — | — | 1 | |||||||||||
Asset impairment charges | 1 | — | — | 1 | |||||||||||
Selling, general and administrative expenses | 346 | 27 | — | 373 | |||||||||||
Engineering and product development costs | 75 | — | — | 75 | |||||||||||
Interest expense | 55 | 27 | — | 82 | |||||||||||
Other expense (income), net | 56 | (8 | ) | (30 | ) | 18 | |||||||||
Total costs and expenses | 3,027 | 46 | (30 | ) | 3,043 | ||||||||||
Equity in income of non-consolidated affiliates | 3 | — | — | 3 | |||||||||||
Income (loss) before equity income from financial services operations and income taxes | (76 | ) | 32 | — | (44 | ) | |||||||||
Equity income from financial services operations | 24 | — | (24 | ) | — | ||||||||||
Income (loss) before income tax | (52 | ) | 32 | (24 | ) | (44 | ) | ||||||||
Income tax benefit (expense) | 9 | (8 | ) | — | 1 | ||||||||||
Net income (loss) | (43 | ) | 24 | (24 | ) | (43 | ) | ||||||||
Less: Net income attributable to non-controlling interests | 5 | — | — | 5 | |||||||||||
Net income (loss) attributable to Navistar International Corporation | $ | (48 | ) | $ | 24 | $ | (24 | ) | $ | (48 | ) | ||||
E-8
For the Six Months Ended April 30, 2019 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Statement of Operations | |||||||||||
Sales of manufactured products | $ | 5,334 | $ | — | $ | — | $ | 5,334 | |||||||
Finance revenues | — | 152 | (57 | ) | 95 | ||||||||||
Sales and revenues, net | 5,334 | 152 | (57 | ) | 5,429 | ||||||||||
Costs of products sold | 4,472 | — | — | 4,472 | |||||||||||
Restructuring charges | 1 | — | — | 1 | |||||||||||
Asset impairment charges | 3 | — | — | 3 | |||||||||||
Selling, general and administrative expenses | 509 | 51 | (1 | ) | 559 | ||||||||||
Engineering and product development costs | 161 | — | — | 161 | |||||||||||
Interest expense | 111 | 56 | — | 167 | |||||||||||
Other expense (income), net | 189 | (18 | ) | (56 | ) | 115 | |||||||||
Total costs and expenses | 5,446 | 89 | (57 | ) | 5,478 | ||||||||||
Equity in income of non-consolidated affiliates | 3 | — | — | 3 | |||||||||||
Income (loss) before equity income from financial services operations and income taxes | (109 | ) | 63 | — | (46 | ) | |||||||||
Equity income from financial services operations | 48 | — | (48 | ) | — | ||||||||||
Income (loss) before income tax | (61 | ) | 63 | (48 | ) | (46 | ) | ||||||||
Income tax benefit (expense) | 35 | (15 | ) | — | 20 | ||||||||||
Net income (loss) | (26 | ) | 48 | (48 | ) | (26 | ) | ||||||||
Less: Net income attributable to non-controlling interests | 11 | — | — | 11 | |||||||||||
Net income (loss) attributable to Navistar International Corporation | $ | (37 | ) | $ | 48 | $ | (48 | ) | $ | (37 | ) | ||||
E-9
Condensed Statements of Assets, Liabilities, and Stockholders' Equity (Deficit)
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
As of April 30, 2020 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Balance Sheet | |||||||||||
Assets | |||||||||||||||
Cash and cash equivalents | $ | 1,497 | $ | 50 | $ | — | $ | 1,547 | |||||||
Restricted cash and cash equivalents | 48 | 83 | — | 131 | |||||||||||
Finance and other receivables, net | 233 | 2,105 | (485 | ) | 1,853 | ||||||||||
Inventories | 1,006 | 6 | — | 1,012 | |||||||||||
Goodwill | 38 | — | — | 38 | |||||||||||
Property and equipment, net | 909 | 298 | — | 1,207 | |||||||||||
Operating lease right of use assets | 120 | 1 | — | 121 | |||||||||||
Investments in and advances to financial services operations | 617 | — | (617 | ) | — | ||||||||||
Investments in non-consolidated affiliates | 28 | — | — | 28 | |||||||||||
Deferred taxes, net | 115 | 2 | — | 117 | |||||||||||
Other assets | 365 | 21 | — | 386 | |||||||||||
Total assets | $ | 4,976 | $ | 2,566 | $ | (1,102 | ) | $ | 6,440 | ||||||
Liabilities and stockholders' equity (deficit) | |||||||||||||||
Accounts payable | $ | 1,513 | $ | 10 | $ | (485 | ) | $ | 1,038 | ||||||
Debt | 3,535 | 1,894 | — | 5,429 | |||||||||||
Postretirement benefits liabilities | 2,032 | — | — | 2,032 | |||||||||||
Other liabilities | 1,752 | 45 | — | 1,797 | |||||||||||
Total liabilities | 8,832 | 1,949 | (485 | ) | 10,296 | ||||||||||
Stockholders' equity attributable to non-controlling interest | 2 | — | — | 2 | |||||||||||
Stockholders' equity (deficit) attributable to controlling interest | (3,858 | ) | 617 | (617 | ) | (3,858 | ) | ||||||||
Total liabilities and stockholders' equity (deficit) | $ | 4,976 | $ | 2,566 | $ | (1,102 | ) | $ | 6,440 | ||||||
E-10
Condensed Statements of Assets, Liabilities, and Stockholders' Equity (Deficit)
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
As of October 31, 2019 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Consolidated Balance Sheet | |||||||||||
Assets | |||||||||||||||
Cash and cash equivalents | $ | 1,328 | $ | 42 | $ | — | $ | 1,370 | |||||||
Restricted cash and cash equivalents | 50 | 137 | — | 187 | |||||||||||
Finance and other receivables, net | 348 | 2,423 | (226 | ) | 2,545 | ||||||||||
Inventories | 905 | 6 | — | 911 | |||||||||||
Goodwill | 38 | — | — | 38 | |||||||||||
Property and equipment, net | 942 | 367 | — | 1,309 | |||||||||||
Investments in and advances to financial services operations | 668 | — | (668 | ) | — | ||||||||||
Investments in non-consolidated affiliates | 31 | — | — | 31 | |||||||||||
Deferred taxes, net | 115 | 2 | — | 117 | |||||||||||
Other assets | 386 | 23 | — | 409 | |||||||||||
Total assets | $ | 4,811 | $ | 3,000 | $ | (894 | ) | $ | 6,917 | ||||||
Liabilities and stockholders' equity (deficit) | |||||||||||||||
Accounts payable | $ | 1,554 | $ | 13 | $ | (226 | ) | $ | 1,341 | ||||||
Debt | 2,932 | 2,256 | — | 5,188 | |||||||||||
Postretirement benefits liabilities | 2,103 | — | — | 2,103 | |||||||||||
Other liabilities | 1,945 | 63 | — | 2,008 | |||||||||||
Total liabilities | 8,534 | 2,332 | (226 | ) | 10,640 | ||||||||||
Stockholders' equity attributable to non-controlling interest | 3 | — | — | 3 | |||||||||||
Stockholders' equity (deficit) attributable to controlling interest | (3,726 | ) | 668 | (668 | ) | (3,726 | ) | ||||||||
Total liabilities and stockholders' equity (deficit) | $ | 4,811 | $ | 3,000 | $ | (894 | ) | $ | 6,917 | ||||||
E-11
Condensed Statements of Cash Flows
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
For the Six Months Ended April 30, 2020 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Condensed Consolidated Statement of Cash Flows | |||||||||||
Cash flows from operating activities | |||||||||||||||
Net income (loss) | $ | (65 | ) | $ | 32 | $ | (32 | ) | $ | (65 | ) | ||||
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: | |||||||||||||||
Depreciation and amortization | 70 | — | — | 70 | |||||||||||
Depreciation of equipment leased to others | (3 | ) | 32 | — | 29 | ||||||||||
Amortization of debt issuance costs and discount | 3 | 4 | — | 7 | |||||||||||
Deferred income taxes | (9 | ) | — | — | (9 | ) | |||||||||
Asset impairment charges | 13 | — | — | 13 | |||||||||||
Equity in loss of non-consolidated affiliates | 2 | — | — | 2 | |||||||||||
Equity in income of financial services affiliates | (32 | ) | — | 32 | — | ||||||||||
Dividends from financial services operations | 30 | — | (30 | ) | — | ||||||||||
Change in intercompany receivables and payables | 118 | (118 | ) | — | — | ||||||||||
Other, net | (608 | ) | 443 | — | (165 | ) | |||||||||
Net cash provided by (used in) operating activities | (481 | ) | 393 | (30 | ) | (118 | ) | ||||||||
Cash flows from investing activities | |||||||||||||||
Capital expenditures | (90 | ) | — | — | (90 | ) | |||||||||
Purchase of equipment leased to others | (5 | ) | (11 | ) | — | (16 | ) | ||||||||
Other investing activities | 10 | 7 | — | 17 | |||||||||||
Net cash used in investing activities | (85 | ) | (4 | ) | — | (89 | ) | ||||||||
Net cash provided by (used in) financing activities | 745 | (438 | ) | 30 | 337 | ||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (12 | ) | 3 | — | (9 | ) | |||||||||
Increase (decrease) in cash, cash equivalents and restricted cash | 167 | (46 | ) | — | 121 | ||||||||||
Cash, cash equivalents and restricted cash at beginning of the period | 1,378 | 179 | — | 1,557 | |||||||||||
Cash, cash equivalents and restricted cash at end of the period | $ | 1,545 | $ | 133 | $ | — | $ | 1,678 | |||||||
E-12
Condensed Statements of Cash Flows
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
For the Six Months Ended April 30, 2019 | |||||||||||||||
(in millions) | Manufacturing Operations | Financial Services Operations | Adjustments | Condensed Consolidated Statement of Cash Flows | |||||||||||
Cash flows from operating activities | |||||||||||||||
Net income (loss) | $ | (26 | ) | $ | 48 | $ | (48 | ) | $ | (26 | ) | ||||
Adjustments to reconcile net income (loss) to cash used in operating activities: | |||||||||||||||
Depreciation and amortization | 66 | — | — | 66 | |||||||||||
Depreciation of equipment leased to others | (1 | ) | 32 | — | 31 | ||||||||||
Amortization of debt issuance costs and discount | 8 | 4 | — | 12 | |||||||||||
Deferred income taxes | (41 | ) | — | — | (41 | ) | |||||||||
Asset impairment charges | 3 | — | — | 3 | |||||||||||
Gain on sales of investments and businesses, net | (59 | ) | — | — | (59 | ) | |||||||||
Equity in income of non-consolidated affiliates | (3 | ) | — | — | (3 | ) | |||||||||
Equity in income of financial services affiliates | (48 | ) | — | 48 | — | ||||||||||
Dividends from non-consolidated affiliates | 1 | — | — | 1 | |||||||||||
Change in other intercompany receivables and payables | 48 | (48 | ) | — | — | ||||||||||
Other, net | (31 | ) | (143 | ) | — | (174 | ) | ||||||||
Net cash used in operating activities | (83 | ) | (107 | ) | — | (190 | ) | ||||||||
Cash flows from investing activities | |||||||||||||||
Maturities of marketable securities | 79 | — | — | 79 | |||||||||||
Capital expenditures | (64 | ) | (2 | ) | — | (66 | ) | ||||||||
Purchase of equipment leased to others | (13 | ) | (63 | ) | — | (76 | ) | ||||||||
Other investing activities | 95 | 5 | 100 | ||||||||||||
Net cash provided by (used in) investing activities | 97 | (60 | ) | — | 37 | ||||||||||
Net cash provided by (used in) financing activities | (342 | ) | 268 | — | (74 | ) | |||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (6 | ) | (4 | ) | — | (10 | ) | ||||||||
Increase (decrease) in cash, cash equivalents and restricted cash | (334 | ) | 97 | — | (237 | ) | |||||||||
Cash, cash equivalents and restricted cash at beginning of the period | 1,295 | 150 | — | 1,445 | |||||||||||
Cash, cash equivalents and restricted cash at end of the period | $ | 961 | $ | 247 | $ | — | $ | 1,208 | |||||||
E-13