EX-99.1 8 navex9917312014.htm ADDITIONAL FINANCIAL INFORMATION (UNAUDITED) NAV EX 99.1 7.31.2014


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 North America Truck segment, North America 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 the net cash provided by 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 July 31, 2014
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
2,806

 
$
—

 
$
—

 
$
2,806

Finance revenues
—

 
60

 
(22
)
 
38

Sales and revenues, net
2,806

 
60

 
(22
)
 
2,844

Costs of products sold
2,417

 
—

 
—

 
2,417

Restructuring charges
16

 
—

 
—

 
16

Asset impairment charges
4

 
—

 
—

 
4

Selling, general and administrative expenses
217

 
25

 
(1
)
 
241

Engineering and product development costs
80

 
—

 
—

 
80

Interest expense
60

 
18

 
—

 
78

Other expense (income), net
17

 
(7
)
 
(21
)
 
(11
)
Total costs and expenses
2,811

 
36

 
(22
)
 
2,825

Equity in income of non-consolidated affiliates
2

 
—

 
—

 
2

Income (loss) before equity income from financial services operations and income taxes
(3
)
 
24

 
—

 
21

Equity income from financial services operations
15

 
—

 
(15
)
 
—

Income (loss) from continuing operations before income taxes
12

 
24

 
(15
)
 
21

Income tax expense
(5
)
 
(9
)
 
—

 
(14
)
Income (loss) from continuing operations
7

 
15

 
(15
)
 
7

Income from discontinued operations, net of tax
1

 
—

 
—

 
1

Net income (loss)
8

 
15

 
(15
)
 
8

Less: Income attributable to non-controlling interests
10

 
—

 
—

 
10

Net income (loss) attributable to Navistar International Corporation
$
(2
)
 
$
15

 
$
(15
)
 
$
(2
)


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 Nine Months Ended July 31, 2014
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
7,683

 
$
—

 
$
—

 
$
7,683

Finance revenues
—

 
172

 
(57
)
 
115

Sales and revenues, net
7,683

 
172

 
(57
)
 
7,798

Costs of products sold
6,899

 
—

 
—

 
6,899

Restructuring charges
26

 
1

 
—

 
27

Asset impairment charges
172

 
1

 
—

 
173

Selling, general and administrative expenses
649

 
71

 
(3
)
 
717

Engineering and product development costs
253

 
—

 
—

 
253

Interest expense
182

 
52

 
—

 
234

Other expense (income), net
73

 
(24
)
 
(54
)
 
(5
)
Total costs and expenses
8,254

 
101

 
(57
)
 
8,298

Equity in income of non-consolidated affiliates
5

 
—

 
—

 
5

Income (loss) before equity income from financial services operations and income taxes
(566
)
 
71

 
—

 
(495
)
Equity income from financial services operations
45

 
—

 
(45
)
 
—

Income (loss) from continuing operations before income taxes
(521
)
 
71

 
(45
)
 
(495
)
Income tax benefit (expense)
1

 
(26
)
 
—

 
(25
)
Income (loss) from continuing operations
(520
)
 
45

 
(45
)
 
(520
)
Income from discontinued operations, net of tax
3

 
—

 
—

 
3

Net income (loss)
(517
)
 
45

 
(45
)
 
(517
)
Less: Income attributable to non-controlling interests
30

 
—

 
—

 
30

Net income (loss) attributable to Navistar International Corporation
$
(547
)
 
$
45

 
$
(45
)
 
$
(547
)


E- 8


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 July 31, 2013
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
2,820

 
$
—

 
$
—

 
$
2,820

Finance revenues
—

 
62

 
(21
)
 
41

Sales and revenues, net
2,820

 
62

 
(21
)
 
2,861

Costs of products sold
2,547

 
—

 
—

 
2,547

Restructuring charges
5

 
1

 
—

 
6

Asset impairment charges
17

 
—

 
—

 
17

Selling, general and administrative expenses
286

 
23

 
(1
)
 
308

Engineering and product development costs
99

 
—

 
—

 
99

Interest expense
60

 
17

 
(1
)
 
76

Other expense (income), net
43

 
(2
)
 
(19
)
 
22

Total costs and expenses
3,057

 
39

 
(21
)
 
3,075

Equity in income of non-consolidated affiliates
3

 
—

 
—

 
3

Income (loss) before equity income from financial services operations and income taxes
(234
)
 
23

 
—

 
(211
)
Equity income from financial services operations
16

 
—

 
(16
)
 
—

Income (loss) from continuing operations before income taxes
(218
)
 
23

 
(16
)
 
(211
)
Income tax expense
(9
)
 
(7
)
 
—

 
(16
)
Income (loss) from continuing operations
(227
)
 
16

 
(16
)
 
(227
)
Loss from discontinued operations, net of tax
(10
)
 
—

 
—

 
(10
)
Net income (loss)
(237
)
 
16

 
(16
)
 
(237
)
Less: Income attributable to non-controlling interests
10

 
—

 
—

 
10

Net income (loss) attributable to Navistar International Corporation
$
(247
)
 
$
16

 
$
(16
)
 
$
(247
)


E- 9


Condensed Statements of Revenues and Expenses
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
 
For the Nine Months Ended July 31, 2013
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
7,905

 
$
—

 
$
—

 
$
7,905

Finance revenues
—

 
178

 
(59
)
 
119

Sales and revenues, net
7,905

 
178

 
(59
)
 
8,024

Costs of products sold
7,196

 
—

 
—

 
7,196

Restructuring charges
10

 
4

 
—

 
14

Asset impairment charges
17

 
—

 
—

 
17

Selling, general and administrative expenses
842

 
66

 
(3
)
 
905

Engineering and product development costs
310

 
—

 
—

 
310

Interest expense
190

 
52

 
(2
)
 
240

Other income, net
27

 
(8
)
 
(54
)
 
(35
)
Total costs and expenses
8,592

 
114

 
(59
)
 
8,647

Equity in income of non-consolidated affiliates
6

 
—

 
—

 
6

Income (loss) before equity income from financial services operations and income taxes
(681
)
 
64

 
—

 
(617
)
Equity income from financial services operations
42

 
—

 
(42
)
 
—

Income (loss) from continuing operations before income taxes
(639
)
 
64

 
(42
)
 
(617
)
Income tax expense
(31
)
 
(22
)
 
—

 
(53
)
Income (loss) from continuing operations
(670
)
 
42

 
(42
)
 
(670
)
Loss from discontinued operations, net of tax
(40
)
 
—

 
—

 
(40
)
Net income (loss)
(710
)
 
42

 
(42
)
 
(710
)
Less: Income attributable to non-controlling interests
34

 
—

 
—

 
34

Net income (loss) attributable to Navistar International Corporation
$
(744
)
 
$
42

 
$
(42
)
 
$
(744
)





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 July 31, 2014
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
Assets
 
 
 
 
 
 
 
Cash and cash equivalents
$
517

 
$
30

 
$
—

 
$
547

Marketable securities
581

 
37

 
—

 
618

Restricted cash
21

 
100

 
—

 
121

Finance and other receivables, net
594

 
2,462

 
(453
)
 
2,603

Inventories
1,445

 
17

 
—

 
1,462

Goodwill
38

 
—

 
—

 
38

Property and equipment, net
1,399

 
258

 
—

 
1,657

Investments in and advances to financial services operations
700

 
—

 
(700
)
 
—

Investments in non-consolidated affiliates
72

 
—

 
—

 
72

Deferred taxes, net
165

 
27

 
—

 
192

Other assets
366

 
26

 
—

 
392

Total assets
$
5,898

 
$
2,957

 
$
(1,153
)
 
$
7,702

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
Accounts payable
$
1,979

 
$
46

 
$
(453
)
 
$
1,572

Debt
3,141

 
2,063

 
—

 
5,204

Postretirement benefits liabilities
2,494

 
35

 
—

 
2,529

Other liabilities
2,330

 
113

 
—

 
2,443

Total liabilities
9,944

 
2,257

 
(453
)
 
11,748

Redeemable equity securities
2

 
—

 
—

 
2

Stockholders' equity attributable to non-controlling interest
34

 
—

 
—

 
34

Stockholders' equity (deficit) attributable to controlling interest
(4,082
)
 
700

 
(700
)
 
(4,082
)
Total liabilities and stockholders' equity (deficit)
$
5,898

 
$
2,957

 
$
(1,153
)
 
$
7,702


E- 11


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, 2013
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
Assets
 
 
 
 
 
 
 
Cash and cash equivalents
$
727

 
$
28

 
$
—

 
$
755

Marketable securities
796

 
34

 
—

 
830

Restricted cash
26

 
65

 
—

 
91

Finance and other receivables, net
767

 
2,284

 
(350
)
 
2,701

Inventories
1,194

 
16

 
—

 
1,210

Goodwill
184

 
—

 
—

 
184

Property and equipment, net
1,521

 
220

 
—

 
1,741

Investments in and advances to financial services operations
686

 
—

 
(686
)
 
—

Investments in non-consolidated affiliates
77

 
—

 
—

 
77

Deferred taxes, net
204

 
27

 
—

 
231

Other assets
464

 
31

 
—

 
495

Total assets
$
6,646

 
$
2,705

 
$
(1,036
)
 
$
8,315

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
Accounts payable
$
1,824

 
$
28

 
$
(350
)
 
$
1,502

Debt
3,219

 
1,866

 
—

 
5,085

Postretirement benefits liabilities
2,614

 
38

 
—

 
2,652

Other liabilities
2,590

 
87

 
—

 
2,677

Total liabilities
10,247

 
2,019

 
(350
)
 
11,916

Redeemable equity securities
4

 
—

 
—

 
4

Stockholders' equity attributable to non-controlling interest
44

 
—

 
—

 
44

Stockholders' equity (deficit) attributable to controlling interest
(3,649
)
 
686

 
(686
)
 
(3,649
)
Total liabilities and stockholders' equity (deficit)
$
6,646

 
$
2,705

 
$
(1,036
)
 
$
8,315


E- 12


Condensed Statements of Cash Activity
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
 
For the Nine Months Ended July 31, 2014
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities
 
 
 
 
 
 
 
Net income (loss)
$
(517
)
 
$
45

 
$
(45
)
 
$
(517
)
Adjustments to reconcile net income (loss) to cash used in operating activities:
 
 
 
 
 
 
 
Depreciation and amortization
176

 
1

 
—

 
177

Depreciation of equipment leased to others
47

 
32

 
—

 
79

Amortization of debt issuance costs and discount
30

 
8

 
—

 
38

Deferred income taxes
(4
)
 
—

 
—

 
(4
)
Asset impairment charges
172

 
1

 
—

 
173

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

 
—

 
(5
)
Equity in income of financial services affiliates
(45
)
 
—

 
45

 
—

Dividends from financial services operations
30

 
—

 
(30
)
 
—

Dividends from non-consolidated affiliates
9

 
—

 
—

 
9

Change in intercompany receivables and payables
73

 
(73
)
 
—

 
—

Other, net
(230
)
 
(64
)
 
—

 
(294
)
Net cash used in operating activities
(264
)
 
(50
)
 
(30
)
 
(344
)
Cash flows from investing activities
 
 
 
 
 
 


Purchases of marketable securities
(1,207
)
 
(3
)
 
—

 
(1,210
)
Sales of marketable securities
1,092

 
—

 
—

 
1,092

Maturities of marketable securities
330

 
—

 
—

 
330

Net change in restricted cash and cash equivalents
5

 
(35
)
 
—

 
(30
)
Capital expenditures
(56
)
 
(1
)
 
—

 
(57
)
Purchase of equipment leased to others
(66
)
 
(91
)
 
—

 
(157
)
Other investing activities
34

 
12

 
—

 
46

Net cash provided by (used in) investing activities
132

 
(118
)
 
—

 
14

Net cash provided by (used in) financing activities
(71
)
 
175

 
30

 
134

Effect of exchange rate changes on cash and cash equivalents
(7
)
 
(5
)
 
—

 
(12
)
Increase (decrease) in cash and cash equivalents
(210
)
 
2

 
—

 
(208
)
Cash and cash equivalents at beginning of the period
727

 
28

 
—

 
755

Cash and cash equivalents at end of the period
$
517

 
$
30

 
$
—

 
$
547


E- 13


Condensed Statements of Cash Activity
Navistar International Corporation
(Manufacturing operations with financial services operations on an after-tax equity basis)
 
For the Nine Months Ended July 31, 2013
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities
 
 
 
 
 
 
 
Net income (loss)
$
(710
)
 
$
42

 
$
(42
)
 
$
(710
)
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
 
 
 
 
 
 
 
Depreciation and amortization
224

 
1

 
—

 
225

Depreciation of equipment leased to others
77

 
28

 
—

 
105

Amortization of debt issuance costs and discount
34

 
9

 
—

 
43

Deferred income taxes
19

 
—

 
—

 
19

Asset impairment charges
25

 
—

 
—

 
25

Gain on sales of investments and businesses, net
(13
)
 
—

 
—

 
(13
)
Equity in loss of non-consolidated affiliates
(6
)
 
—

 
—

 
(6
)
Equity in income of financial services affiliates
(42
)
 
—

 
42

 
—

Dividends from non-consolidated affiliates
11

 
—

 
—

 
11

Change in intercompany receivables and payables
(12
)
 
12

 
—

 
—

Other, net
145

 
190

 
—

 
335

Net cash provided by (used in) operating activities
(248
)
 
282

 
—

 
34

Cash flows from investing activities
 
 
 
 
 
 
 
Purchases of marketable securities
(1,057
)
 
(13
)
 
—

 
(1,070
)
Sales of marketable securities
664

 
—

 
—

 
664

Maturities of marketable securities
164

 
—

 
—

 
164

Net change in restricted cash and cash equivalents
1

 
(10
)
 
—

 
(9
)
Capital expenditures
(135
)
 
(1
)
 
—

 
(136
)
Purchase of equipment leased to others
(266
)
 
(85
)
 
—

 
(351
)
Other investing activities
44

 
3

 
—

 
47

Net cash used in investing activities
(585
)
 
(106
)
 
—

 
(691
)
Net cash provided by (used in) financing activities
208

 
(194
)
 
—

 
14

Effect of exchange rate changes on cash and cash equivalents
(21
)
 
2

 
—

 
(19
)
Decrease in cash and cash equivalents
(646
)
 
(16
)
 
—

 
(662
)
Cash and cash equivalents at beginning of the period
1,059

 
28

 
—

 
1,087

Cash and cash equivalents at end of the period
$
413

 
$
12

 
$
—

 
$
425



E- 14