Navistar International (NYSE:NAV) on Thursday tapped insider and former General Motors (NYSE:GM) exec Troy Clarke as the truck and engine maker’s next CEO, revealed plans to split its CEO and chairman roles and posted stronger-than-expected quarterly results.
Wall Street cheered the major moves, sending shares of the automotive company racing 20% higher out of the gate.
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Navistar said Clarke, the company’s chief operating officer since January 2010, will replace interim CEO Lewis Campbell on April 15.
“Today I am pleased to announce our turnaround is firmly underway and our return to profitability is clearly in sight,” Campbell said in a statement. “Troy is the right executive to lead the company forward at this time, and I am confident Navistar will continue to build on its momentum.”
Billionaire activist investor Carl Icahn, who owns a stake in Navistar, also praised the selection of Clarke.
"We are behind Troy 100% in his efforts to build Navistar into a focused, competitive and profitable truck and engine manufacturer," Icahn said in a statement.
While Clarke, 57, will remain Navistar’s president, the company’s board has decided to split up the CEO and chairman titles, selecting current director James Keyes to serve as non-executive chairman.
“I want to thank Lewis for his guidance and leadership during this period,” Clarke said. “Working together, we have implemented a number of important actions to set Navistar on the right path, and the company now has a strong platform to build upon going forward.”
Clarke joined Navistar after a 35-year stint at GM, where he served as president of GM North America and president of the auto maker’s Mexican business.
Meanwhile, Navistar revealed a lighter-than-expected loss for the fiscal first quarter.
The company said it lost $123 million, or $1.53 a share, last quarter, compared with a loss of $153 million, or $2.19 a share, a year earlier. Analysts had called for a deeper loss of $1.76 a share.
Revenue slid 12% to $2.64 billion, trailing the Street’s view of $2.81 billion.
Shares of Lisle, Ill.-based Navistar surged 27.48% to $31.84 Thursday morning, leaving them up 46% so far this year.