LISLE, Ill. - Navistar International Corporation (NYSE: NAV) announced a second quarter 2021 net income of $163 million, or $1.63 per diluted share, compared to second quarter 2020 net loss of $38 million, or $0.38 per diluted share. The results in the second quarter of 2021 included $91 million of tax-effected significant items.
Second quarter 2021 adjusted net income was $72 million compared to a loss of $10 million in second quarter 2020.
Revenues in the quarter were $2.2 billion, compared to $1.9 billion in the second quarter last year.
Chargeouts in the company's Core (Class 6-8 trucks and buses in the United States and Canada) market were 13,900 units in the second quarter of 2021.
Second quarter 2021 adjusted EBITDA nearly doubled year-over-year to $198 million, or 9.2% of revenue, versus $88 million, or 4.6% of revenue, a year ago.
Navistar finished second quarter 2021 with $1.2 billion in consolidated cash and cash equivalents, including $1.2 billion in manufacturing cash and cash equivalents.
The company has increased production line rates in all of its vehicle assembly plants, including adding a second shift to its truck assembly plant in Escobedo, Mexico. The pace of the increases has been slower than planned due to supply chain constraints.
'We delivered strong operating results in our second quarter,' said Persio Lisboa, chief executive officer, Navistar. 'The strong trucking industry, fueled by robust economic growth, is supporting higher order activity by our customers and our team is working hard to overcome the supply chain challenges to best support their transportation needs.'
The company made progress on its Navistar 4.0 business strategy throughout the quarter. In March, the company launched a new aftermarket product line to provide high-quality aftermarket parts for Class 2-5 diesel engines and engine components called Diamond Advantage Diesel Parts. Diamond Advantage parts will be distributed through Navistar's parts distribution centers to warehouse distributors, diesel parts specialists and the International dealer network. The new product line reflects the company's commitment to supporting customers on the road through an extensive Class 2-8 product offering.
In the connected space, the company announced the upcoming availability of Cummins Connected Software Updates and programmable trim parameters for their X15 engines through Navistar's OnCommand Connection portal. This integration builds upon the company's over-the-air capability on the International A26 engine - making it the first and only OEM to use a single, factory-installed device to equip multiple engine models with remote programming. This is enabled by Navistar's second-generation telematics devices, which began production in mid-2019.
In electric, the company delivered its first electric school buses to Canada. The 18 electric CE Series school buses were delivered by Western Canada Bus to British Columbia School Districts. The company also announced that it has over 100 orders for its electric CE Series.
The company is also strengthening its manufacturing footprint. Its San Antonio, Texas, manufacturing facility is on schedule to begin production of vehicles in early 2022 and the expansion of its Huntsville, Alabama, engine facility remains on track for completion in the first half of 2023.
The company is also making progress related to its pending merger with TRATON, which remains on track to close in the middle of 2021. The company has announced a conditional call of the 9.5 percent Senior Secured Notes and its 4.75 percent Tax Exempt Bonds upon the closing of the merger.
'Guided by our Navistar 4.0 strategy and fueled by the hard work of our team, Navistar is capitalizing on the strong demand in the industry today,' said Lisboa. 'This, together with the many opportunities available to us when our merger with TRATON is complete, leads to a very exciting future for our company, our customers and all of our stakeholders.'
Truck Segment - In second quarter 2021, Truck segment net sales were $1.5 billion, a 7 percent increase versus second quarter last year. The increase was primarily driven by higher used truck volumes, higher sales of GM branded units and higher Mexico volumes.
The Truck segment reported a net profit of $189 million in second quarter 2021, compared to a loss of $51 million in second quarter 2020. The increase was primarily driven by a gain from an increase in fair value of the equity security investment in TuSimple and higher sales, partially offset by a charge for a tentative legal settlement and higher warranty costs.
Parts Segment - For second quarter 2021, Parts segment net sales were $524 million, an 18 percent increase from second quarter 2020. The increase was primarily driven by higher volumes in the U.S. and Canada.
The Parts segment generated a second quarter profit of $135 million, up 31 percent compared to the second quarter last year. The increase was primarily driven by higher sales.
Global Operations Segment - In second quarter 2021, Global Operations segment net sales increased 171 percent versus second quarter 2020 to $138 million. The increase was primarily driven by higher engine and power generator volumes, the recognition of an estimated benefit related to Brazilian tax credits, and higher parts sales revenues in South American operations.
The Global Operations segment recorded a profit of $36 million in the second quarter of 2021, compared to a loss of $13 million in second quarter 2020. The increase was primarily due to higher revenues in 2021 and the recording of asset impairment charges in second quarter 2020.
Financial Services Segment - In second quarter 2021, Financial Services segment reported net revenues of $50 million compared to $64 million in second quarter 2020. The decrease was primarily driven by lower average yields.
The Financial Services segment recorded a profit of $15 million in the quarter, compared to $24 million in second quarter 2020. The decrease was primarily driven by lower revenues partially offset by a decrease in interest expense resulting from lower borrowing requirements and lower borrowing rates.
About Navistar
Navistar International Corporation (NYSE: NAV) is a holding company whose subsidiaries and affiliates produce International brand commercial trucks, proprietary diesel engines, and IC Bus brand school and commercial buses. An affiliate also provides truck and diesel engine service parts. Another affiliate offers financing services. Additional information is available at www.Navistar.com.
Forward-Looking 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 ('Securities Act'), Section 21E of the Securities Exchange Act of 1934, as amended ('Exchange Act'), and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this report and Navistar International Corporation 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 31,2020 and our quarterly report on Form 10-Q for the period ended April 30, 2021. 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.
Contact:
Media
Bre Whalen
E: Breana.Whalen@Navistar.com
T: 331-332-3056
Investors
Marty Ketelaar
E: Marty.Ketelaar@Navistar.com
T: 331-332-2706
NAVISTAR INTERNATIONAL CORPORATION 
