Navistar Earnings Plunge

Navistar International Corp. posted an $84 million net profit in the fiscal third quarter ended July 31 compared with $1.4 billion a year earlier. Revenue slid 6% to $3.3 billion.

The company's third-quarter results in 2011 were distorted by a one-time $1.5 billion tax gain. On a pretax basis, Navistar nearly doubled its loss year over year to $100 million in the May-July period.

The company's truck and engine operations recorded losses of $30 million and $47 million, respectively. The deficit was partially offset by profits from its parts and financial services units. Navistar paid $10 million in fines in the third quarter for heavy-duty diesel engines that didn't meet federal emission standards.

The company did not provide an estimate of full-year results.

Lewis Campbell, who was named CEO at the end of August, says he is reviewing unidentified non-core Navistar businesses. "We're going to fix them" or divest them, Campbell tells analysts. The company in recent years has expanded from heavy-duty trucks and diesel engines into such businesses as recreational vehicles, military trucks and cement mixers.

Navistar says 500 salaried employees accepted buyout offers in the quarter, fewer than it hoped. The company will dismiss 200 workers in the fourth quarter. Navistar expects to take a charge of as much as $75 million for the separations, which will save as much as $80 million annually about half the company's cost-cutting goal.