Thursday, January 29, 2009

YRC loses $974 million in 2008

YRC Worldwide Inc. reported a loss of $974.4 million in 2008 and a 7 percent drop in revenue compared with 2007.

In a release after the market closed on Thursday, the Overland Park-based company reported a loss of $16.92 a share for its fiscal year, which ended Dec. 31. This compares with a loss of $638.4 million, or $11.17 a share, in 2007.

Revenue in 2008 was $8.94 billion, down from $9.62 billion in 2007.

For the fourth quarter, the company reported a loss of $244.4 milion, or $4.14 a share, compared with a loss of $735.8 million, or $12.99 a share, a year earlier. Revenue for the quarter was $1.93 billion, down 18 percent from $2.35 billion a year earlier.

The company recorded a fourth-quarter impairment charge of $141 million for its Roadway trade name related to the company’s introduction of a new YRC brand for the integrated network of Yellow Transportation and Roadway. The impairment charge also included goodwill of $59 million at YRC Logistics.

YRC has had quite a ride in the past year, including layoffs, a pay cut for its employees who are International Brotherhood of Teamsters members and the accelerated integration of Yellow and Roadway.

“Our results reflect the significance of the economic recession that has been longer and deeper than anyone anticipated,” Chairman and CEO Bill Zollars said in the release. “Although we were not pleased with this level of performance, it was consistent with our internal expectations and those of our banking group. The discussions with the banks are progressing well, and we are on track to finalize an amendment by mid-February.”

Zollars said that the network integration at YRC is on track to deliver a run-rate of $200 million of operating income improvement by early in the fourth quarter of 2009 which, combined with the employee wage reductions of about $300 million, leave the company expecting to improve its financial performance by more than $500 million going into 2010.

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