YRC Worldwide reports narrower third-quarter profit

YRC, whose shares have lost about three-quarters of their value this year, said it would not make a prediction for fourth-quarter results because of economic uncertainty. But the company said it still expected to pay off $100 million in debt during the quarter and would remain below lender requirements.

By DAVID TWIDDY
The Associated Press

10/24/2008

KANSAS CITY, Mo. — YRC Worldwide Inc., one of the nation’s largest trucking companies, on Thursday reported narrower third-quarter profits as the economic slowdown diminished the number of shipments.

Excluding gains and other items, the company said it would have posted a loss of 32 cents per share, compared with analysts average estimates of a loss of 8 cents per share, according to Thomson Reuters.

YRC said it earned $36.6 million, or 63 cents per share, including items, compared with earnings of $40.7 million, or 70 cents per share, a year ago.

The adjustments included a $15.5 million gain on property sales, $7.2 million in reorganization charges and a streamlining of pension costs for nonunion workers.

Revenue fell 3.2 percent to $2.38 billion, topping analysts’ expectation of $2.34 billion.

Bill Zollars, the company’s chief executive, said in a statement, “Throughout the third quarter, the operating environment progressively weakened resulting in lower than expected volumes and more competitive pricing.”

YRC said daily tonnage for its National Transportation division fell 9 percent and 17.2 percent in its Regional Transportation division.

Zollars said the company still generated significant free cash flow and paid off $11.4 million in debt during the quarter, or $50.3 million so far this year.

The company, whose shares have lost about three-quarters of their value this year, said it would not make a prediction for fourth-quarter results because of economic uncertainty. But the company said it still expected to pay off $100 million in debt during the quarter and would remain below lender requirements.

YRC said it is continuing to determine whether it will take impairment charges on the value of its National, Regional and YRC Logistics divisions. It said such a charge would not involve cash and wouldn’t go against calculating its leverage ratio.

The company has struggled this year as the market for shippers has dried up because businesses are moving less freight. The company earlier this year said it was closing an administrative office with 90 workers in Topeka, Kan., and a cutting 200 workers at its logistics operations in Edwardsville, Ill., and St. Louis.

YRC released its earnings after markets closed Thursday. During trading, shares gained 18 cents to $3.95.