YRC Worldwide posts higher 3Q net loss

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YRC Worldwide Inc. on Friday, Nov. 4, announced consolidated operating revenue for the third quarter of 2011 was $1.276 billion, up 12.3 percent over 2010, and consolidated operating loss was $24 million, which included $12 million of restructuring professional fees and a $15 million noncash charge for union employee equity awards. As a comparison, the company reported consolidated operating revenue of $1.137 billion for the third quarter of 2010 and a consolidated operating loss of $19 million, which included $7 million of restructuring professional fees.

The Overland Park, Kan.-based company reported a net loss of $120 million, which includes a $79 million noncash charge related to fair value adjustments for the derivative instruments embedded in the $140 million Series A notes and $100 million Series B notes due 2015. As a comparison, the company reported a net loss of $62 million for the third quarter of 2010.

“With our 12.3 percent revenue increase, our working capital continues to be well managed, as demonstrated by the 38.5 days-sales-outstanding for consolidated receivables, which is about one day better than third quarter a year ago,” said Jamie Pierson, chief financial officer of YRC Worldwide. “The unused availability from the new $400 million ABL facility provides important liquidity to support our working capital needs, which are driven by seasonality and our year-over-year revenue growth.”

YRC National Transportation’s operating revenues were up 11.5 percent to $841.6 million, while its adjusted operating ratio improved by 70 basis points to 100.9, tons per day were up 4.2 percent, shipments per day were up 5.5 percent, revenue per hundredweight was up 7.5, and revenue per shipment was up 6.2 percent. Regional Transportation’s operating revenues were up 14.3 percent to $404.8 million, while its adjusted operating ratio improved by 180 basis points to 95.2, tons per day were up 5.6 percent, shipments per day were up 3.6 percent, revenue per hundredweight was up 8.2 percent, and revenue per shipment was up 10.4 percent.

“We are pleased with the continued year-over-year growth in business volumes as we seek to change the culture of the company and transition to new leadership,” said James Welch, chief executive officer of YRC Worldwide. “The leadership changes at the parent company and YRC, together with the redeployment of our shared services functions, are all designed to position the company for improved operating results from an increased focus on the delivery of consistently reliable service to our customers.”

YRC Worldwide also announced that Jamie Pierson, 42, has been appointed the company’s executive vice president and chief financial officer effective immediately. Pierson recently served as the company’s interim chief financial officer since August 2011.

“We are extremely pleased and very fortunate that Jamie has agreed to come on board,” Welch said. “Jamie knows our business thoroughly, bringing exceptional technical knowledge and financial acumen to this role. His outside perspective will be instrumental as we shape the future of our company. As we position the company for future growth and return YRC Worldwide to a more traditional, leaner holding company, Jamie will be invaluable and exceptionally qualified to oversee our financial strategy.”

Previously, Pierson was a managing director with Alvarez & Marsal North America, where he focused on out-of-court restructurings and senior management advisory. Prior to joining A&M, he was vice president of corporate development and integration with Greatwide Logistics Services and immediately preceding that was a managing director with FTI Capital Advisors, the wholly-owned investment banking unit of FTI Consulting Inc. Previously, he was with Houlihan Lokey Howard & Zukin, where he worked in the firm’s financial advisory group.