Shawshank,VA 6/7/12 (StreetBeat) -- U.S. truck and engine maker Navistar International Corp (NYSE:NAV) reported a second-quarter loss and cut its profit forecast for the year, as it continues to wait on U.S. regulatory approval for a new model of diesel engine.
Shares fell 11 percent to $25 in premarket trading, placing them at the lowest in a year if they open at that point on the New York Stock Exchange.
The second-quarter loss of $172 million included a $104 million pretax charge for warranty expenses to repair trucks sold in 2010 and 2011. It earned $74 million, or 93 cents a share, a year earlier.
In its second downward revision to guidance this year, the company said it now expects 2012 adjusted earnings to range from break even to $2.00 per share, down from an initial forecast of $5.00 to $5.75 a share.
"Clearly their engine strategy hasn't worked and that has filtered through to the rest of the business," said Basili Alukos, an analyst at Morningstar in Chicago who follows the company.
Lisle, Illinois-based Navistar said it continued to await regulatory approval for a heavy-duty truck engine. The engine, which doesn't comply with emission rules, is the subject of a U.S. Environmental Protection Agency probe launched earlier this year.
The company faces costs of $2,000 per non-compliant engine, JP Morgan said in a recent note to clients. Customers, too, await regulatory approval before they place orders, it said.
Navistar revenue fell about 2 percent to $3.3 billion.
Shares of the company were down 55 percent from a year ago, as of Wednesday's $28.15 close.
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