Subscribe to our free, weekly email newsletter!


LTL news: YRCW completes its long-awaited financial restructuring

By Staff
September 19, 2011

The financial restructuring of less-than-truckload services provider YRC Worldwide (YRCW)  appears to be complete based on news late last week noting that company shareholders unanimously voted to have YRCW common stock diluted, according to media reports.

This news follows a $500 million restructuring announced in July, which included a new $400 million lending agreement.

Before the restructuring, YRCW had 48 million outstanding shares. After the restructuring, it has 1.9 billion shares, meaning former shareholders will own just 2.5 percent of YRC. The other 97.5 percent is now owned by new shareholders comprised of lenders, bondholders, and labor union members, according to Reuters.

  The restructuring included a radical 1-9 reverse stock split which means a new set of shareholders will own the company, with former shareholders’ value sharply diluted. Existing stockholders will now own just 2.5 percent of the company under this new deal.

In the second quarter of this year, YRCW reported a net loss of $39 million on $1.257 billion revenue, compared to a net loss of $10 million on $1.119 billion revenue in the second quarter of 2010, which included an $83 million after-tax benefit.

Following this news on Friday, shares of YRCW dropped nearly 70 percent to 10 cents per share.

With this restructuring now complete, YRCW is focused on the future and regaining market share it has lost over the last four years.

CEO James Welch, whom replaced Bill Zollars earlier this year, told the Kansas City Star that over the last eight weeks the company’s on-time delivery rates have increased to 94 percent from 88 percent.

When the restructuring was first announced in July, YRCW officials said it would enhance the company’s liquidity and provide a “runway for the continued growth in revenues and earnings.”

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Seasonally-adjusted (SA) for-hire truck tonnage in July headed up 1.3 percent on the heels of a 0.8 percent increase in June. The ATA’s not seasonally-adjusted (NSA) index, which represents the change in tonnage actually hauled by fleets before any seasonal adjustment, was 133.3 in July, which outpaced June’s 132.3 by 0.8 percent, and was up 2.8 percent annually.

Volumes for the month of July at the Port of Long Beach (POLB) and the Port of Los Angeles (POLA) were mixed, according to data recently issued by the ports. Unlike May and June, which saw higher than usual seasonal volumes, due to the West Coast port labor situation, July was down as retailers had completed filling inventories for back-to-school shopping.

With a 0.8 cent decrease, this week’s average price per gallon is $3.835 and stands as the lowest price since hitting $3.844 the week of November 25, 2013.

LTL carriers are rapidly investing in expensive, on-dock, three-dimensional size measurement capturing machinery, and they are hoping one day of being able to more accurately charge shippers rates based on the actual dimensions of their shipments, rather than the traditional weight-and-distance-based formula that has been in effect since the 1930s or even earlier.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) recently reported that its Freight Transportation Services Index (TSI) dipped 0.9 percent from May to June.

Article Topics

News · LTL · YRC Worldwide · YRC · Less-Than-Truckload · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA