Navistar International (NAV) 10-Q 2008 Q3 Quarterly report

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 business with our financial services operations on a pre-tax equity basis. Our manufacturing operations, for this purpose, includes our Truck segment, Engine segment, Parts segment, and Corporate items. The manufacturing operations financial information represents non-GAAP financial measures. The reconciling difference between these non-GAAP financial measures and our GAAP financial statements in Item 1 to the accompanying condensed consolidated financial statements is our financial services operations, which is included on a pre-tax equity basis.

Condensed Statements of Operations

Navistar International Corporation (with financial services operations on a pre-tax equity basis)

		Three Months Ended July 31,						Nine Months Ended July 31,
		2008			2007			2008			2007
(in millions)
Sales of manufactured products, net		$	3,879		$	2,852		$	10,592		$	8,802
Cost of products sold			3,115			2,428			8,762			7,505
Selling, general and administrative expense			348			342			967			935
Engineering and product development costs			108			86			289			284
Other expense, net			27			31			116			191
Total costs and expenses			3,598			2,887			10,134			8,915
Income (loss) before income taxes	— Manufacturing operations		281			(35	)		458			(113	)
	— Financial services operations		(1	)		40			(7	)		124
Income before income taxes			280			5			451			11
Income tax expense			(8	)		(9	)		(17	)		(28	)
Net income (loss)		$	272		$	(4	)	$	434		$	(17	)

E-157

Condensed Statements of Assets, Liabilities, and Stockholders’ Deficit

Navistar International Corporation (with financial services operations on a pre-tax equity basis)

	As of
	July 31, 2008			October 31, 2007
(in millions)
Cash and cash equivalents	$	558		$	716
Marketable securities		18			6
Accounts receivables		1,245			788
Inventories		1,489			1,380
Investments in and advances to non-consolidated affiliates		177			154
Investments in and advances to financial services affiliates		398			397
Property and equipment, net		1,849			1,980
Goodwill and intangible assets, net		651			639
Other assets		320			325
Deferred taxes, net		122			123
Total assets	$	6,827		$	6,508
Accounts payable	$	2,116		$	1,888
Postretirement benefits liabilities		1,203			1,310
Debt—manufacturing operations		1,884			2,028
Other liabilities		1,852			2,016
Stockholders’ deficit		(228	)		(734	)
Total liabilities and stockholders’ deficit	$	6,827		$	6,508

E-158

Condensed Statements of Cash Activities

Navistar International Corporation (with financial services operations on a pre-tax equity basis)

	Nine Months Ended July 31,
	2008			2007
(in millions)
Cash flow from operating activities:
Net income (loss)	$	434		$	(17	)
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
Depreciation and amortization		251			233
Depreciation of equipment held for or under lease		29			26
Deferred taxes		(5	)		20
Equity in loss (income) of financial services operations		7			(124	)
Equity in income of non-consolidated affiliates		(63	)		(62	)
Dividends from financial services operations		25			275
Dividends from non-consolidated affiliates		54			74
Other, net		(592	)		(605	)
Net cash provided by (used in) operating activities		140			(180	)
Cash flow from investing activities:
Purchases of marketable securities		(43	)		(178	)
Sales or maturities of marketable securities		31			309
Net change in restricted cash and cash equivalents		(1	)		—
Capital expenditures		(139	)		(206	)
Purchase of equipment held for or under lease		(11	)		(13	)
Acquisitions, net of cash acquired		—			(7	)
Other investment activities		20			30
Net cash used in investing activities		(143	)		(65	)
Net cash used in financing activities		(164	)		(287	)
Effect of exchange rate changes on cash and cash equivalents		9			56
Decrease in cash and cash equivalents		(158	)		(476	)
Cash and cash equivalents at beginning of the period		716			1,078
Cash and cash equivalents at end of the period	$	558		$	602

E-159