EX-99.1 8 navex9914302019.htm EXHIBIT 99.1 Exhibit


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, 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-6



Condensed Statements of Revenues and Expenses
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
 
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 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 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-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, 2018
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
2,382

 
$
—

 
$
—

 
$
2,382

Finance revenues
—

 
63

 
(23
)
 
40

Sales and revenues, net
2,382

 
63

 
(23
)
 
2,422

Costs of products sold
1,987

 
—

 
—

 
1,987

Restructuring charges
1

 
—

 
—

 
1

Asset impairment charges
1

 
—

 
—

 
1

Selling, general and administrative expenses
176

 
25

 
(1
)
 
200

Engineering and product development costs
75

 
—

 
—

 
75

Interest expense
58

 
21

 
—

 
79

Other expense (income), net
35

 
(2
)
 
(22
)
 
11

Total costs and expenses
2,333

 
44

 
(23
)
 
2,354

Income (loss) before equity income from financial services operations and income taxes
49

 
19

 
—

 
68

Equity income from financial services operations
16

 
—

 
(16
)
 
—

Income (loss) before income tax
65

 
19

 
(16
)
 
68

Income tax expense
(4
)
 
(3
)
 
—

 
(7
)
Net income (loss)
61

 
16

 
(16
)
 
61

Less: Net income attributable to non-controlling interests
6

 
—

 
—

 
6

Net income (loss) attributable to Navistar International Corporation
$
55

 
$
16

 
$
(16
)
 
$
55


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 Six Months Ended April 30, 2018
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Statement of Operations
Sales of manufactured products
$
4,249

 
$
—

 
$
—

 
$
4,249

Finance revenues
—

 
122

 
(44
)
 
78

Sales and revenues, net
4,249

 
122

 
(44
)
 
4,327

Costs of products sold
3,519

 
—

 
—

 
3,519

Restructuring charges
(2
)
 
—

 
—

 
(2
)
Asset impairment charges
3

 
—

 
—

 
3

Selling, general and administrative expenses
347

 
45

 
(1
)
 
391

Engineering and product development costs
150

 
—

 
—

 
150

Interest expense
116

 
42

 
—

 
158

Other expense (income), net
138

 
(4
)
 
(43
)
 
91

Total costs and expenses
4,271

 
83

 
(44
)
 
4,310

Equity in income of non-consolidated affiliates
—

 
—

 
—

 
—

Income (loss) before equity income from financial services operations and income taxes
(22
)
 
39

 
—

 
17

Equity income from financial services operations
32

 
—

 
(32
)
 
—

Income (loss) before income tax
10

 
39

 
(32
)
 
17

Income tax expense
(15
)
 
(7
)
 
—

 
(22
)
Net income (loss)
(5
)
 
32

 
(32
)
 
(5
)
Less: Net income attributable to non-controlling interests
13

 
—

 
—

 
13

Net income (loss) attributable to Navistar International Corporation
$
(18
)
 
$
32

 
$
(32
)
 
$
(18
)

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, 2019
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
Assets
 
 
 
 
 
 
 
Cash and cash equivalents
$
927

 
$
50

 
$
—

 
$
977

Marketable securities
23

 
—

 
—

 
23

Restricted cash and cash equivalents
34

 
197

 
—

 
231

Finance and other receivables, net
483

 
2,531

 
(215
)
 
2,799

Inventories
1,157

 
7

 
—

 
1,164

Goodwill
38

 
—

 
—

 
38

Property and equipment, net
938

 
332

 
—

 
1,270

Investments in and advances to financial services operations
639

 
—

 
(639
)
 
—

Investments in non-consolidated affiliates
32

 
—

 
—

 
32

Deferred taxes, net
116

 
5

 
—

 
121

Other assets
388

 
23

 
—

 
411

Total assets
$
4,775

 
$
3,145

 
$
(854
)
 
$
7,066

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
Accounts payable
$
1,821

 
$
24

 
$
(215
)
 
$
1,630

Debt
2,962

 
2,395

 
—

 
5,357

Postretirement benefits liabilities
1,950

 
—

 
—

 
1,950

Other liabilities
1,894

 
87

 
—

 
1,981

Total liabilities
8,627

 
2,506

 
(215
)
 
10,918

Stockholders' equity attributable to non-controlling interest
3

 
—

 
—

 
3

Stockholders' equity (deficit) attributable to controlling interest
(3,855
)
 
639

 
(639
)
 
(3,855
)
Total liabilities and stockholders' equity (deficit)
$
4,775

 
$
3,145

 
$
(854
)
 
$
7,066


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, 2018
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Consolidated Balance Sheet
Assets
 
 
 
 
 
 
 
Cash and cash equivalents
$
1,261

 
$
59

 
$
—

 
$
1,320

Marketable securities
101

 
—

 
—

 
101

Restricted cash and cash equivalents
34

 
91

 
—

 
125

Finance and other receivables, net
505

 
2,259

 
(101
)
 
2,663

Inventories
1,102

 
8

 
—

 
1,110

Goodwill
38

 
—

 
—

 
38

Property and equipment, net
1,060

 
310

 
—

 
1,370

Investments in and advances to financial services operations
581

 
—

 
(581
)
 
—

Investments in non-consolidated affiliates
50

 
—

 
—

 
50

Deferred taxes, net
117

 
4

 
—

 
121

Other assets
314

 
18

 
—

 
332

Total assets
$
5,163

 
$
2,749

 
$
(682
)
 
$
7,230

Liabilities and stockholders' equity (deficit)
 
 
 
 
 
 
 
Accounts payable
$
1,664

 
$
43

 
$
(101
)
 
$
1,606

Debt
3,426

 
2,041

 
—

 
5,467

Postretirement benefits liabilities
2,097

 
—

 
—

 
2,097

Other liabilities
1,902

 
84

 
—

 
1,986

Total liabilities
9,089

 
2,168

 
(101
)
 
11,156

Stockholders' equity attributable to non-controlling interest
5

 
—

 
—

 
5

Stockholders' equity (deficit) attributable to controlling interest
(3,931
)
 
581

 
(581
)
 
(3,931
)
Total liabilities and stockholders' equity (deficit)
$
5,163

 
$
2,749

 
$
(682
)
 
$
7,230


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, 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 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
 
 
 
 
 
 
 
Purchases of marketable securities
—

 
—

 
—

 
—

Sales of marketable securities
—

 
—

 
—

 
—

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-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, 2018
(in millions)
Manufacturing Operations
 
Financial Services Operations
 
Adjustments
 
Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities
 
 
 
 
 
 
 
Net income (loss)
$
(5
)
 
$
32

 
$
(32
)
 
$
(5
)
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
 
 
 
 
 
 
 
Depreciation and amortization
73

 
—

 
—

 
73

Depreciation of equipment leased to others
9

 
27

 
—

 
36

Amortization of debt issuance costs and discount
10

 
5

 
—

 
15

Deferred income taxes
1

 
—

 
—

 
1

Asset impairment charges
3

 
—

 
—

 
3

Equity in income of financial services affiliates
(32
)
 
—

 
32

 
—

Dividends from non-consolidated affiliates
3

 
—

 
—

 
3

Change in other intercompany receivables and payables
29

 
(29
)
 
—

 
—

Other, net
(130
)
 
(94
)
 
—

 
(224
)
Net cash used in operating activities
(39
)
 
(59
)
 
—

 
(98
)
Cash flows from investing activities
 
 
 
 
 
 
 
Purchases of marketable securities
(148
)
 
—

 
—

 
(148
)
Sales of marketable securities
460

 
—

 
—

 
460

Maturities of marketable securities
18

 
—

 
—

 
18

Capital expenditures
(53
)
 
—

 
—

 
(53
)
Purchase of equipment leased to others
(39
)
 
(53
)
 
—

 
(92
)
Other investing activities
(2
)
 
5

 
—

 
3

Net cash provided by (used in) investing activities
236

 
(48
)
 
—

 
188

Net cash provided by financing activities
209

 
60

 
—

 
269

Effect of exchange rate changes on cash, cash equivalents and restricted cash
(6
)
 
(1
)
 
—

 
(7
)
Increase (decrease) in cash, cash equivalents and restricted cash
400

 
(48
)
 
—

 
352

Cash, cash equivalents and restricted cash at beginning of the period
690

 
150

 
—

 
840

Cash, cash equivalents and restricted cash at end of the period
$
1,090

 
$
102

 
$
—

 
$
1,192


E-13