YRC Worldwide Inc. on Friday, May 6, reported a net loss of $102 million for the first quarter of 2011, an improvement from the net loss of $274 million reported for the first quarter of 2010. Consolidated operating revenue was $1.1 billion, and consolidated operating loss was $68 million.
The Overland Park, Kan.-based company said its operating revenue and operating loss were impacted by extreme winter weather and included $8 million of restructuring professional fee expenses. In addition, the company recorded a charge of $17 million to increase its self-insured claims reserve, primarily related to workers’ compensation claims, which occurred during or were open and unsettled at the 2009 integration of the Yellow and Roadway network operations.
As a comparison, the company reported consolidated operating revenue of $987 million for the first quarter of 2010 and an operating loss of $233 million, which included a $108 million charge for union employee equity awards, $12 million of restructuring professional fee expenses and an $11 million charge for prior years’ self-insured claims.
“We are pleased with the year-over-year growth in business volumes and adjusted EBITDA improvements at YRC National and across our Regional companies,” said Bill Trubeck, interim executive vice president, chief financial officer and treasurer of YRC Worldwide. “Our first-quarter operating performance improved significantly once we moved past the severe winter weather in the first two months of the quarter. Excluding the insurance charge, we generated adjusted EBITDA in excess of $20 million for the month of March.”
The company said proceeds of a new $400 million three-year asset-based loan facility will be used to increase liquidity and refinance the current asset-backed securitization facility in connection with the company’s overall restructuring that was announced on April 29. Additionally, the definitive agreements to support the company’s restructuring plan anticipate an infusion of $100 million in new capital and also contemplate that a portion of the company’s existing loans and other obligations will be exchanged for new securities with extended maturities, including the exchange of some obligations for equity.
During the first quarter of 2011, YRC National Transportation’s adjusted operating ratio improved by 5.6 points, tons per day were up 7.9 percent, and revenue per shipment was up 3.3 percent. YRC Regional Transportation’s adjusted operating ratio improved by 0.9 points, tons per day were up 16.2 percent, and revenue per shipment was up 7.7 percent. During April, YRC National and Regional companies’ tons per day increased by 7.6 percent and 8.5 percent, respectively, over April 2010.
“With the operating momentum we achieved exiting the first quarter, which continued into April, we expect to achieve positive adjusted EBITDA in the second quarter of 2011,” Trubeck said.