Friday, August 03, 2012
Best Second Quarter Liquidity since 2008
YRC Worldwide Inc. today reported financial results for the second quarter of 2012.
Consolidated operating revenue for the second quarter of 2012 was $1.251 billion, just 0.5% under 2011, and consolidated operating income was $15.5 million, which included a $6.5 million gain on asset disposals. This is the first time since third quarter of 2008 that the company has reported income from operations, excluding second quarter of 2010, which included an $83 million non-cash reduction to its equity-based compensation expense. As a comparison, the company reported consolidated operating revenue of $1.257 billion for the second quarter of 2011 and a consolidated operating loss of $5.6 million, which included a $7.3 million gain on asset disposals.
The company reported, on a non-GAAP basis, adjusted EBITDA for the second quarter of 2012 of $70.1 million, a $5.6 million improvement over the $64.5 million adjusted EBITDA during the comparable period in 2011 (as detailed in the reconciliation below). Additionally, given the resumption of multi-employer pension plan contributions in June 2011, the company recorded an incremental $14 million of multi-employer pension plan expense in the second quarter of 2012 that was not incurred during the second quarter of 2011.
"Our focused approach to pricing discipline, customer mix management and cost initiatives has driven year-over-year improvement in our business, which is reflected in our operating income," stated James Welch, chief executive officer of YRC Worldwide. "We are producing results slightly ahead of our forecast, despite the recently softening economy, and remain focused on executing our operations and sales strategies at all operating companies. We continue to be committed to delivering consistent, high-quality and cost-effective service for our customers and value for our stakeholders," he added. "I also want to especially recognize the resiliency and dedication of the 33,000 employees who are working diligently to help move YRCW forward in a positive and progressive way. We are fortunate to have employees who have the passion and the drive to return the company to its leadership position, and they prove it every day by working to satisfy our customers while at the same time embracing our culture of working safely," said Welch.
Thursday, August 02, 2012
The lawsuit was originally filed in November 2010 and was dismissed by Judge Wright in December of the same year. On appeal, the case was remanded to the district court for further consideration, resulting in yesterday's ruling.
YRCW is satisfied with the court's decision and believes the court ruled correctly and in accordance with the language of the collective bargaining agreement.
The resolution of this lawsuit is in keeping with YRCW's committed effort to vigorously defend itself against these alleged claims by the plaintiff. YRC Worldwide has and will continue to protect and defend its reputation, as well as its services and brands.
On August 1, 2012, Judge Susan Webber Wright of the U.S. District Court for the Western District of Arkansas entered an order dismissing the case brought by Arkansas Best Corporation's (Nasdaq: ABFS) largest subsidiary, ABF, without prejudice. This case was originally filed on November 1, 2010, against the IBT and other parties including several YRC Worldwide subsidiaries for violations of the collective bargaining agreement covering most unionized trucking employees in the country. Previous to today's ruling, Judge Wright had dismissed the case but that dismissal was later reversed by the Eighth Circuit Court of Appeals. ABF is studying the ruling and evaluating its options which include, among other avenues, taking a second appeal to the Eighth Circuit or refiling the case in the District Court.
Among the competitors representing ABF is two-time National Champion Tony Spero (2006, 2009). Competing as 2012 Grand Champions from their respective states will be ABF drivers Spero (Connecticut), Chuck Smetzer (Maryland), and Kent Jones (Oklahoma).
"ABF is extremely proud of our drivers who have earned the privilege to compete in this year's National Truck Driving Championships," said Sam Cates, ABF safety and security director. "These drivers are just a sampling of the many ABF professional drivers who safely deliver and protect the goods entrusted to us on a daily basis--providing unmatched value-added logistics solutions for our customers. The reputation ABF enjoys as a trusted supply-chain partner and a safety leader will be well represented with this group."
Known informally as the Super Bowl of Safety, the annual event is sponsored by the Safety and Loss Prevention Management Council of the American Trucking Associations. The goal is to promote driving safety among the nation's three million professional truck drivers. Competitive divisions include straight truck, three-axle, four-axle, five-axle, tank truck, flatbed, five-axle sleeper, twins and step van. The comprehensive competitions include written examinations, pre-trip inspection and a demonstration of braking, parking, backing and maneuvering skills.
The ABF slate of state champions for the 2012 national competition includes: Jesse Ballard, Ore., sleeper; Ed Beins, Neb., 3-axle; Gerald Benavidez, N.M., sleeper; Rick Camarda, Calif., 5-axle; Michael Contreras, N.M., 5-axle; John Davis, Va., straight truck; Kent Durant, Kan., tank truck; Charlie Estrada, N.M., flatbed; Ralph Garcia, N.M., 4-axle; John Gibson, W.Va., tank truck; Garry Holliman. Ark., 3-axle, grand champion runner-up; Kent Jones, Okla., twins, grand champion; Jeff Keller, Penn., tank truck; A.J. Kelly, Wyo., twins, team trophy; Tom Martin, Wyo., 3-axle, highest score, personal interview; Nate McCarty, Colo., straight truck; Tim McElwaney, Ga., 4-axle, highest overall score; Peter Root, Vt., twins; Steve Smalley, Ariz., twins; Chuck Smetzer, Md., twins, grand champion; Tony Spero, Conn., flatbed, grand champion; Robert Sutton, Idaho, 3-axle; Andrew Walston, Wyo., straight truck; and Roger Phillips, Wyo., flatbed. The ABF driving teams in New Mexico and Wyoming also won the Team Trophies.
The ATA's advance seasonally adjusted index of for-hire truck tonnage jumped 1.2 percent in June, the largest increase it has seen all year. The jump was unexpected following two consecutive months of declines in April and May, which saw the index fall a combined 2.1 percent. When compared to June 2011 the index showed a 3.2 percent increase, the smallest year-over-year gain since March 2012.
"June's increase was a pleasant surprise, but the lower year-over-year gain fits with an economy that has slowed," ATA Chief Economist Bob Costello said in a release. "Manufacturing output was strong in June, which helped tonnage levels."
YRC Worldwide has one of the largest, most comprehensive less-than-truckload networks in North America with local, regional, national and international capabilities. The company recently announced that S&P's Ratings Services have initiated coverage on YRC Worldwide $400 million ABL Facility. The ABL Facility received a recovery rating of '1', the second highest recovery rating available, and a facility rating of B-.
Tuesday, July 31, 2012
The second quarter 2012 results included a tax benefit of $8.0 million, or $0.31 per share, related to the reversal of previously established deferred tax asset valuation allowances, and transaction costs of $2.1 million ($1.3 million, after tax), or $0.05 per share, associated with the June 15, 2012 acquisition of Panther Expedited Services, Inc. ("Panther"). Excluding both of these items, Arkansas Best had second quarter 2012 net income of $5.2 million, or $0.18 per share.
"A number of significant developments occurred during the second quarter, including closing the acquisition of Panther, our premium logistics provider," said Arkansas Best President and CEO Judy R. McReynolds. "This transaction represents a major step in our long-term strategy to grow our non-asset-based businesses. If Panther had been included, total 2011 revenues for Arkansas Best’s non-asset businesses would have exceeded $400 million. The addition of Panther and the services provided by our other non-asset-based subsidiaries complement our offerings at ABF and allow us to strengthen customer relationships."
ABF implemented a 6.9% increase in its general rates and charges on June 25, 2012 that was in effect during the last week of the second quarter. Second quarter price increases on ABF accounts under contract and deferred pricing agreements remained at favorable levels. In the second quarter of 2011, ABF began an aggressive initiative to address inadequate pricing and improve the profitability of many accounts across its network. This effort continues in 2012. As a result, the incremental profitability of ABF’s account base has improved.
"While we are encouraged by ABF’s yield initiatives, we continue to focus on various paths to reduce ABF’s overall cost structure," said Ms. McReynolds. "On-going efforts that offer opportunities to reduce ABF’s cost structure include ABF’s labor contract lawsuit, collaborative work to develop a permanent solution to correct our payment of non-ABF multiemployer pension benefits and preparations for negotiation of a new April 2013 labor contract."
ABF’s second quarter 2012 daily tonnage levels continued to be below those of the same period last year as the U.S. economy remained inconsistent. However, in each month of this year’s second quarter, the level of tonnage decrease improved versus 2011. During the second half of 2012, monthly tonnage levels will be compared back to the second half of 2011, when ABF experienced declining tonnage versus 2010. Full Report..........
Tobolic has competed at state driving competitions since 2003, always in the 5-axle class. He also placed first in the Michigan competitions and qualified for nationals in 2004. A professional driver for 38 years, Tobolic has been a city driver out of the Holland Grand Rapids, MI terminal for over 34 years. He is an active member on the Grand Rapids terminal Safety Committee, and also serves as a driver trainer at the terminal. In 2004, Tobolic was named Michigan State Driver of the Month by the Michigan Trucking Association, and was also presented with the Chairman's Award. In 2006, he was nominated for the prestigious America's Road Team.
"Safe driving requires not just skill, but a good attitude," said Tobolic. "You have to remain calm and courteous behind the wheel. Every day brings a challenge, but you have to always keep your cool and stay focused."
Holland drivers are encouraged to use driving competitions as a way to hone their driving skills, and improve safety. "Drivers like Mike are what make Holland the industry leader that it is today. Safety in and of itself is always a top priority; but the unmatched levels of safety that drivers like Mike provide also translate into unmatched service and reliability," said Scott Ware, president of Holland.
To qualify for the national championships, drivers must place first in their respective class at state competition. Both the state and national competitions include challenging driving skills and maneuvering tests, a pre-trip inspection, and a written examination covering vehicle operation and federal safety regulations. To participate in the state competitions, drivers must be accident-free for one year.
Monday, July 30, 2012
Vanbibber was first in the tank truck class and won the title of Grand Champion.
Garcia placed first in the straight truck class.
They will go on to compete at the 2012 National Truck Driving Championships August 7-11 in Minneapolis.
Garcia has been in the trucking industry for 27 years and has been with YRC Freight for 15 years.
Vanbibber has been with the company for his entire 27-year career.
The state and national competitions include driving skills and maneuvering tests, a pre-trip inspection, and a written examination covering vehicle operation and federal safety regulations.
To participate in the state competitions, drivers must be accident-free for one year.
This year, three Holland drivers earned division titles to advance to the national competition. Our state champions are: Herschel Evans/GA 5-axle (city driver in Atlanta); Mike Tobolic/MI 5-axle (city driver in Grand Rapids); and David White/OH tanker (linehaul driver in Akron).
This is a special time for us to celebrate the professionalism of Holland drivers. Local, state and national driving contests are more than a test of how well a driver can operate a vehicle--they are a safety program that challenges drivers to sharpen their driving skills. Congratulations to all our drivers who participated in this year's competitions.