Navistars First Profit Since 2012 Navistar International Corp.

Navistar Reports First Profit Since 2012

“We just completed an important quarter that shows the benefit of strong cost management as well as lean enterprise efforts and our ability to earn a profit despite industry headwinds,” said CEO Troy Clarke.

Shares of Navistar International Corp. (IW 1000/411) surged the most in more than three years after the truckmaker reported a surprise quarterly profit, its first since 2012, outweighing concerns as the company lowered its 2016 forecasts.

The shares gained 24% to $15.11 at 12:31 p.m. New York time after rising as much as 29%, the biggest intraday jump since March 2013.

The company posted fiscal second-quarter net income of $4 million, helped by cost cuts, while the average of analyst estimates compiled by Bloomberg was a $15.2 million loss.

The profit ended a 14-quarter streak of net losses and came amid a slump in demand for heavy-duty trucks. That downturn led Navistar to trim its full-year outlook for sales to $8.2 billion to $8.6 billion, from at least $9 billion, and for earnings before interest, taxes, depreciation and amortization to $550 million to $600 million, from a minimum of $600 million.

“We just completed an important quarter that shows the benefit of strong cost management as well as lean enterprise efforts and our ability to earn a profit despite industry headwinds,” CEO Troy Clarke told analysts.

“While the second half poses new challenges due to softening industry conditions, we are a resilient organization and we intend to deliver the best achievable results,” Clarke added.

Navistar said on June 7 that structural cost reductions in its first half reached $113 million and that, including savings from materials and manufacturing, expense cuts for the full year are on track to exceed its goal of $200 million.

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