UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2000
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
----------
Commission File Number 1-4146-1
----------
NAVISTAR FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 36-2472404
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2850 West Golf Road Rolling Meadows, Illinois 60008
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code 847-734-4000
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
APPLICABLE ONLY TO ISSUERS INVOLVED
IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of February 29, 2000, the number of shares outstanding of the registrant's
common stock was 1,600,000.
THE REGISTRANT IS A WHOLLY-OWNED SUBSIDIARY OF NAVISTAR INTERNATIONAL
TRANSPORTATION CORP. AND MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS
H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Statements of Consolidated Income and Retained Earnings --
Three Months Ended January 31, 2000 and 1999. . . . . . . . . . 2
Statements of Consolidated Financial Condition --
January 31, 2000; October 31, 1999; and January 31, 1999. . . . 3
Statements of Consolidated Cash Flow --
Three Months Ended January 31, 2000 and 1999. . . . . . . . . . 4
Notes to Consolidated Financial Statements . . . . . . . . . . . 5
Item 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition. . . . . . . . . . . 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . 13
Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME AND RETAINED EARNINGS (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
Three Months Ended
January 31
---------------------
2000 1999
---- ----
<S> <C> <C>
Revenue
Retail note financing............................. $ 16.4 $ 22.1
Lease financing................................... 22.2 17.4
Wholesale notes................................... 19.0 14.7
Accounts.......................................... 11.3 8.3
Servicing fee income.............................. 6.9 6.2
Insurance premiums earned......................... 10.5 8.5
Marketable securities............................. 1.8 2.0
------ ------
Total...................................... 88.1 79.2
------ ------
Expense
Cost of borrowing:
Interest expense.............................. 24.0 22.2
Other......................................... 1.5 1.7
------ ------
Total...................................... 25.5 23.9
Credit, collection and administrative............. 10.9 10.1
Provision for losses on receivables............... 1.4 1.3
Insurance claims and underwriting................. 10.5 10.3
Depreciation expense and other.................... 12.4 9.9
------ ------
Total....................................... 60.7 55.5
------ ------
Income Before Taxes on Income.......................... 27.4 23.7
Taxes on Income........................................ 10.2 9.2
------ -----
Net Income............................................. 17.2 14.5
Retained Earnings
Beginning of period................................ 111.2 109.0
Dividends paid..................................... (7.0) (12.0)
------ ------
End of period...................................... $121.4 $111.5
====== ======
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
January 31 October 31 January 31
2000 1999 1999
---------- ---------- ----------
ASSETS
<S> <C> <C> <C>
Cash and Cash Equivalents.................. $ 16.4 $ 38.6 $ 9.8
Marketable Securities...................... 143.0 101.7 104.8
Finance Receivables
Retail note financing.................. 546.0 851.9 532.3
Lease financing........................ 192.8 187.8 149.2
Wholesale notes........................ 223.0 528.7 355.5
Accounts............................... 528.1 507.5 396.8
-------- -------- --------
1,489.9 2,075.9 1,433.8
Allowance for losses................... (11.1) (13.4) (11.1)
-------- -------- --------
Finance Receivables, Net........... 1,478.8 2,062.5 1,422.7
Amounts Due from Sales of Receivables...... 328.4 244.5 266.6
Equipment on Operating Leases, Net......... 267.1 266.7 230.9
Repossessions.............................. 24.7 21.0 17.7
Other Assets............................... 93.5 114.1 88.4
-------- -------- --------
Total Assets............................... $2,351.9 $2,849.1 $2,140.9
======== ======== ========
LIABILITIES AND SHAREOWNER'S EQUITY
Short-Term Borrowings...................... $ 25.0 $ 34.5 $ 14.9
Net Accounts Payable to Affiliates......... 204.3 706.9 212.3
Other Liabilities.......................... 54.4 49.5 54.7
Senior and Subordinated Debt............... 1,680.3 1,675.8 1,470.7
Dealers' Reserves.......................... 24.4 24.2 24.6
Unpaid Insurance Claims and
Unearned Premiums........................ 74.8 77.9 79.9
Shareowner's Equity
Capital stock (Par value $1.00, 1,600,000
shares issued and outstanding)
and paid-in capital................ 171.0 171.0 171.0
Retained earnings...................... 121.4 111.2 111.5
Accumulated other comprehensive
(loss) income............................ (3.7) (1.9) 1.3
-------- -------- --------
Total.............................. 288.7 280.3 283.8
------- -------- --------
Total Liabilities and Shareowner's Equity.. $2,351.9 $2,849.1 $2,140.9
======== ======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOW (Unaudited)
(Millions of dollars)
<TABLE>
<CAPTION>
Three Months Ended
January 31
---------------------------
2000 1999
----------- ------------
<S> <C> <C>
Cash Flow From Operations
Net income...................................... $ 17.2 $ 14.5
Adjustments to reconcile net income to cash
Provided by operations:
Gains on sales of receivables............... (2.2) (5.7)
Depreciation and amortization............... 13.4 10.8
Provision for losses on receivables......... 1.4 1.3
(Decrease) increase in accounts payable
to affiliates............................ (502.6) 75.5
Other....................................... 4.5 (5.1)
------- -------
Total.................................... (468.3) 91.3
------- -------
Cash Flow From Investing Activities
Proceeds from sold retail notes................. 496.1 518.5
Purchase of retail notes and lease receivables.. (263.3) (315.6)
Principal collections on retail notes and
lease receivables........................... 26.3 0.4
Proceeds from sold wholesale notes.............. 300.0 -
Acquisitions over cash collections of wholesale
notes and accounts receivable............... (62.6) (134.6)
Purchase of marketable securities............... (52.3) (8.5)
Proceeds from sales and maturities
of marketable securities.................... 8.4 11.7
Purchase of equipment leased to others.......... (18.8) (24.3)
Sale of equipment leased to others.............. 5.7 1.1
------- -------
Total....................................... 439.5 48.7
------- -------
Cash Flow From Financing Activities
Net decrease in short term borrowings........... (9.5) (6.8)
Net increase in bank revolving credit
facility usage.............................. 85.0 -
Net decrease in asset-backed commercial paper
facility usage.............................. (79.6) (78.8)
Proceeds from long-term debt.................... 41.4 48.5
Principal payments of long-term debt............ (23.7) (95.2)
Dividends paid to Transportation................ (7.0) (12.0)
------- -------
Total....................................... 6.6 (144.3)
------- -------
Decrease in Cash and Cash Equivalents............... (22.2) (4.3)
Cash and Cash Equivalents at Beginning of Period.... 38.6 14.1
------- -------
Cash and Cash Equivalents at End of Period.......... $ 16.4 $ 9.8
======= =======
Supplemental disclosure of cash flow information
Interest paid................................... $ 28.2 $ 29.8
======= =======
Income taxes paid............................... $ 1.8 $ 2.4
======= =======
</TABLE>
See Notes to Consolidated Statements.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The consolidated financial statements include the accounts of Navistar
Financial Corporation ("NFC") and its wholly-owned subsidiaries
("Corporation"). Navistar International Transportation Corp.
("Transportation"), which is wholly-owned by Navistar International
Corporation ("Navistar"), is the parent company of the Corporation.
Effective February 23, 2000, Transportation changed its name to
International Truck and Engine Corporation.
The accompanying unaudited financial statements have been prepared in
accordance with accounting policies described in the Corporation's 1999
Annual Report on Form 10-K and should be read in conjunction with the
disclosures therein.
In the opinion of management, these interim financial statements reflect
all adjustments, consisting of normal recurring accruals, necessary to
present fairly the results of operations, financial condition and cash
flow for the interim periods presented. Interim results are not
necessarily indicative of results to be expected for the full year.
Certain 1999 amounts have been reclassified to conform with the
presentation used in the 2000 financial statements.
2. Finance receivable balances do not include receivables sold by the
Corporation to public and private investors with limited recourse
provisions. Outstanding sold receivables balances are as follows:
January 31 October 31 January 31
2000 1999 1999
---------- ---------- ----------
($ Millions)
Retail notes............... $1,986.5 $1,696.0 $1,757.2
Wholesale notes............ 900.0 600.0 639.5
-------- -------- --------
Total................... $2,886.5 $2,296.0 $2,396.7
======== ======== ========
In November 1999, the Corporation sold $533 million of retail notes, net
of unearned finance income, through Navistar Financial Retail Receivables
Corporation ("NFRRC"), a wholly owned subsidiary of the Corporation, to
two multi-seller asset-backed commercial paper conduits sponsored by a
major financial institution. A gain of $2.2 million was recognized on the
sale.
In January 2000, the Corporation sold $300 million of variable funding
certificates, through Navistar Financial Securities Corporation, a wholly
owned subsidiary of the Corporation, to a conduit sponsored by a major
financial institution. The variable funding certificates mature in
2001.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
In March 2000, the Corporation sold $475 million of retail notes, net of
unearned finance income, through NFRRC to an owner trust which, in turn,
sold notes to investors. A gain of $0.3 million was recognized on the
sale.
The allowance for losses on receivables is summarized as follows:
January 31 October 31 January 31
2000 1999 1999
---------- ---------- ----------
($ Millions)
Allowance pertaining to:
Owned notes. . . . . . . . . . $11.1 $13.4 $11.1
Sold notes . . . . . . . . . . 15.1 12.8 15.1
----- ----- -----
Total. . . . . . . . . . . $26.2 $26.2 $26.2
===== ===== =====
3. As of January 31, 2000, the Corporation was a party to a total of $400
million of forward treasury locks and $75 million of forward starting
swaps related to the anticipated March 2000 sale of retail receivables.
The Corporation closed these positions and the resulting $0.8 million
gain was included in the gain on the sale of receivables recognized in
March 2000.
In the second quarter of fiscal 2000, the Corporation entered into a
total of $200 million of forward treasury locks in anticipation of a July
2000 sale of retail receivables. Any gain or loss will be included in the
gain or loss on the sale of receivables recognized in July 2000.
In November 1999, the Corporation sold fixed rate retail receivables on a
variable rate basis and entered into an interest rate swap agreement to
hedge the future cash flows of the amounts due from the sale of
receivables. Under the terms of the agreement, the Corporation will make
or receive payments based on changes in interest rates. The net
settlement is included in retail note financing revenue.
In November 1998, the Corporation sold fixed rate retail receivables to a
multi-seller asset-backed commercial paper conduit sponsored by a major
financial institution on a variable rate basis. For the protection of
investors, the Corporation issued an interest rate cap. The notional
amount of the cap amortizes based on the expected outstanding principal
balance of the sold retail receivables. Under the terms of the cap
agreement, the Corporation will make payments if interest rates exceed
certain levels. As of January 31, 2000 the cap had a notional amount of
$349 million and a fair value of $2.5 million.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
4. The Corporation's total comprehensive income was as follows:
Three Months Ended January 31
2000 1999
----------------------------
($ Millions)
Net Income. . . . . . . . . . . . . . . $17.2 $14.5
Changes in unrealized gains/(losses) on
marketable securities . . . . . . . . (1.8) (0.2)
----- -----
Total Comprehensive Income . . . . . $15.4 $14.3
===== =====
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Certain statements under this caption, which involve risks and uncertainties,
constitute "forward-looking statements" under the Securities Reform Act.
Navistar Financial Corporation's actual results may differ significantly from
the results discussed in such forward-looking statements. Factors that might
cause such a difference include, but are not limited to, those discussed under
the headings "Year 2000" and "Business Outlook."
Financing Volume
In the first quarter of fiscal 2000 industry retail sales for Class 5 through 8
trucks were approximately 8% higher than 1999. The Corporation's retail
financing acquisitions in fiscal 2000, including retail notes and finance and
operating leases, were $282.1 million, 17% lower than 1999. The decrease
resulted primarily from the continuing, highly competitive commercial financing
market, which led to a decrease in the Corporation's finance market share of new
International trucks sold in the U.S. from 16.3% in 1999 to 12.3% in fiscal
2000. Serviced retail notes and lease financing balances were $2,993 million and
$2,670 million at January 31, 2000 and 1999 respectively.
In spite of the continued strong liquidity in the commercial financing market,
the Corporation provided 96% of the wholesale financing of new trucks sold to
Transportation's dealers in the first quarter of fiscal 2000 and 1999. Serviced
wholesale note balances were $1,267 million at January 31, 2000, a 15% increase
compared to the same period of 1999.
Results of Operations
The components of net income for the three months ended January 31 are as
follows:
2000 1999
---- ----
Income before income taxes:
Finance operations................................. $25.5 $23.6
Insurance operations............................... 1.9 0.1
----- -----
Income before taxes............................ 27.4 23.7
Taxes on income.................................... 10.2 9.2
----- -----
Net income..................................... $17.2 $14.5
===== =====
Pretax income was $27.4 million and $23.7 million in the first quarter of fiscal
2000 and 1999, respectively. The improvement was due primarily to a higher level
of average outstanding accounts payable to affiliates which proportionately
lowered debt levels and interest expense and higher finance receivable balances.
This was offset, in part, by a lower gain on the sale of retail note receivables
and the competitive commercial financing market which continued to put pressure
on retail and wholesale finance margins.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION (continued)
Results of Operations (continued)
Finance Operations:
Retail note financing revenue was $16.4 million in the first quarter of 2000
compared to $22.1 million in 1999. The decrease is primarily the result of a
lower gain on the sale of retail note receivables and lower margins. Gains on
the sale of retail note receivables were $2.2 million and $5.7 million in the
first quarter of fiscal 2000 and 1999, respectively. The lower gain reflects
lower retail note margins and increased funding rates offered to the Corporation
in the asset-backed market.
Lease financing revenue was $22.2 million in the first quarter of 2000 compared
to $17.4 million in 1999. The increase is primarily the result of continued
growth in lease financing.
Wholesale note revenue was $19.0 million in the first quarter of fiscal 2000
compared to $14.7 million in 1999. The increase is primarily a result of the
higher level of wholesale financing activity and an increase in the average
prime rate.
Retail and wholesale account revenue was $11.3 million in the first quarter of
2000 compared to $8.3 million in fiscal 1999. The increase is primarily the
result of higher average balances and an increase in the average prime rate.
Borrowing costs increased $1.6 million to $25.5 million during the first quarter
of 2000 due primarily to higher average receivable funding requirements and
higher average interest rates, partially offset by the higher level of average
outstanding accounts payable to affiliates. The higher level of average
outstanding accounts payable to affiliates reduced debt levels and resulted in a
reduction in borrowing costs of $7.3 million for the first quarter of fiscal
year 2000. The Corporation's weighted average interest rate on all debt
increased to 6.2% in 2000 from 5.9% in the first quarter of 1999 primarily due
to higher market interest rates.
Depreciation and other expenses increased to $12.4 million in the first quarter
of 2000 from $9.9 million in 1999. The increase is primarily the result of
depreciation on a larger investment in equipment under operating leases.
Insurance Operations:
Harco National Insurance Company's pretax income in the first quarter of fiscal
2000 was $1.8 million higher than 1999 primarily due to increased premiums
earned in liability lines and favorable loss experience in both the physical
damage and liability lines.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION (continued)
Liquidity and Funds Management
The Corporation has traditionally obtained the funds to provide financing to
Transportation's dealers and retail customers from sales of finance receivables,
commercial paper, short and long-term bank borrowings, medium and long-term debt
and equity capital. The Corporation's current debt ratings have made sales of
finance receivables the most economical source of funding. The Corporation's
insurance subsidiary generates its funds through internal operations and has no
external borrowings.
In February 2000, Standard and Poors raised the Corporation's senior debt
ratings from BB+ to BBB-, while the subordinated debt ratings were also raised
from BB- to BB+. In May 1999, Moody's and Duff and Phelps raised the
Corporation's senior debt ratings from Ba1 and BBB- to Baa3 and BBB,
respectively, while also raising the subordinated debt ratings from Ba3 and BB+
to Ba2 and BBB-, respectively.
Operations used $468.3 million in cash in the first quarter of 2000 primarily as
a result of the decrease of $502.6 million in accounts payable to affiliate. To
fund the cash used for operations, investing activities provided $439.5 million
in cash during this period primarily as a result of the sale of retail and
wholesale notes, offset by the purchases of retail note and lease receivables.
Financing activities, excluding dividends of $7.0 million, provided $13.6
million.
Receivable sales were a significant source of funding in the first quarter of
fiscal 2000 and 1999. Through the asset-backed markets, the Corporation has been
able to fund fixed rate retail note receivables at rates offered to companies
with investment grade ratings. During the first quarter of fiscal 2000, the
Corporation sold $533 million of retail notes, net of unearned finance income,
through Navistar Financial Retail Receivables Corporation ("NFRRC"), a wholly
owned subsidiary, to two multi-seller asset-backed commercial paper conduits
sponsored by a major financial institution. During the first quarter of fiscal
1999 the Corporation sold $545 million of retail notes, net of unearned finance
income, through NFRRC, to a multi-seller asset-backed commercial paper conduit
sponsored by a major financial institution. At January 31, 2000, the remaining
shelf registration available to NFRRC for the public issuance of asset-backed
securities was $2,257 million.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION (continued)
Liquidity and Funds Management (continued)
In January 2000, the Corporation sold $300 million of variable funding
certificates, through Navistar Financial Securities Corporation ("NFSC"), a
wholly owned subsidiary of the Corporation, to a conduit sponsored by a major
financial institution. The variable funding certificates mature in 2001. As of
January 31, 2000, NFSC had a revolving wholesale note trust that provides for
the funding of $900 million of eligible wholesale notes.
At January 31, 2000, available funding under the bank revolving credit facility
and the asset-backed commercial paper program was $100 million, of which $25
million provided funding backup for the outstanding short-term debt. The
remaining $75 million, when combined with unrestricted cash and cash
equivalents, made $136 million available to fund the general business purposes
of the Corporation.
As of January 31, 2000, the Corporation was a party to a total of $400 million
of forward treasury locks and $75 million of forward starting swaps related to
the anticipated March 2000 sale of retail receivables. The Corporation closed
these positions and the resulting $0.8 million gain was included in the gain on
the sale of receivables recognized in March 2000.
In the second quarter of fiscal 2000, the Corporation entered into a total of
$200 million of forward treasury locks in anticipation of a July 2000 sale of
retail receivables. Any gain or loss will be included in the gain or loss on the
sale of receivables recognized in July 2000.
In November 1998, the Corporation sold fixed rate retail receivables to a
multi-seller asset-backed commercial paper conduit sponsored by a major
financial institution on a variable rate basis. For the protection of investors,
the Corporation issued an interest rate cap. The notional amount of the cap
amortizes based on the expected outstanding principal balance of the sold retail
receivables. Under the terms of the cap agreement, the Corporation will make
payments if interest rates exceed certain levels. As of January 31, 2000 the cap
had a notional amount of $349 million and a fair value of $2.5 million.
In November 1999, the Corporation sold fixed rate retail receivables on a
variable rate basis and entered into an interest rate swap agreement to hedge
the future cash flows of the amounts due from the sale of receivables. Under the
terms of the agreement, the Corporation will make or receive payments based on
changes in interest rates. The net settlement is included in retail note
financing revenue.
<PAGE>
NAVISTAR FINANCIAL CORPORATION
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION (continued)
Year 2000
As described in the 1999 Annual Report on Form 10-K, the Corporation had
instituted a corporate-wide Year 2000 readiness project to identify all
significant information technology ("IT") applications which would require
modification or replacement, and to establish appropriate remediation and
contingency plans to avoid an impact on the company's ability to continue to
provide its products and services. Through the date of this report, the company
has not experienced any significant Year 2000 problems but will continue to
monitor its critical systems over the next several months. In the event that
significant issues arise, the company's contingency plans remain in place.
Total costs connected with the remediation of the Corporation's significant IT
systems totaled $2 million in 1999, $3 million in 1998 and $1 million in 1997.
Costs in the first quarter 2000 were not material. Approximately 25% of the
total costs, representing investment in purchased IT systems, were capitalized
and will be depreciated over three to five years. The total cost of the Year
2000 project has not had a material impact on the Corporation's financial
position or results of operations and has been funded through operating cash
flows.
Business Outlook
The truck industry in 2000 is forecasted to decrease approximately 13% from
1999. The competitive commercial financing market will continue to put pressure
on the Corporation's retail and wholesale financing activity and margins.
Increased volatility in the capital markets is likely to put additional pressure
on the funding rates offered to the Corporation in the asset-backed public
market, commercial paper markets and other debt financing markets. Additionally,
rising fuel costs may impact the financial strength of the Corporation's
customers and the Corporation's ability to maintain the current level of
portfolio quality.
Management believes that collections on the outstanding receivables portfolio
plus cash available from the Corporation's various funding sources will permit
Navistar Financial Corporation to meet the financing requirements of
Transportation's dealers and retail customers through 2000 and beyond.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed during the three months ended January 31,
2000.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Navistar Financial Corporation
(Registrant)
Date March 15, 2000 /s/P. E. Cochran
-------------- --------------------------------
P. E. Cochran
Vice President and Controller
(Principal Accounting Officer)
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
STATEMENT ON CONSOLIDATED INCOME AND RETAINED EARNINGS AND THE STATEMENT
OF CONSOLIDATED FINANCIAL CONDITION AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-2000<F1>
<PERIOD-END> JAN-31-2000
<CASH> 16,400
<SECURITIES> 143,000
<RECEIVABLES> 1,489,900
<ALLOWANCES> (11,100)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 14,733
<DEPRECIATION> (9,345)
<TOTAL-ASSETS> 2,351,900
<CURRENT-LIABILITIES> 0
<BONDS> 1,680,300
0
0
<COMMON> 171,000
<OTHER-SE> 117,700
<TOTAL-LIABILITY-AND-EQUITY> 2,351,900
<SALES> 0
<TOTAL-REVENUES> 88,100
<CGS> 0
<TOTAL-COSTS> 22,900
<OTHER-EXPENSES> 12,400
<LOSS-PROVISION> 1,400
<INTEREST-EXPENSE> 24,000
<INCOME-PRETAX> 27,400
<INCOME-TAX> (10,200)
<INCOME-CONTINUING> 17,200
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,200
<EPS-BASIC> 0
<EPS-DILUTED> 0
<FN>
<F1> THE CORPORATION'S STATEMENT OF FINANCIAL CONDITION IS UNCLASSIFIED;
THEREFORE, THE DISTINCTION BETWEEN CURRENT AND LONG-TERM ASSETS AND
LIABILITIES IS NOT AVAILABLE.
</FN>
</TABLE>
