Subscribe to our free, weekly email newsletter!


YRC reports steady improvements in 2012 and fourth quarter earnings results

By Jeff Berman, Group News Editor
February 08, 2013

This morning’s fourth quarter and 2012 year-end earnings release from less-than-truckload transportation services provider YRC Worldwide brought something the company has not seen in six years: a positive annual operating income. 

This news represents continued good news for the financially ailing LTL carrier, which has lost more than $2.6 billion over the last five years.

YRC’s consolidated operating revenue for 2012—at $4.851 billion—was down 0.4 percent compared to 2011, but its consolidated operating income increased $162.3 million to $24.1 million, including a $9.7 million gain on asset disposals, marking its first positive annual consolidated operating income in six years. And it reported that 2012 consolidated operating revenue at $4.869 billion and a consolidated operating loss of $138.2 million, including an $8.2 million gain on asset disposals. EBITDA for 2012 at $241.2 million represented an $82.0 million improvement over 2011.

Following the second and third quarters, which saw operating profits of $27.3 million and $15.5 million, respectively, which represented the first time in four years that YRC, the second-largest LTL carrier behind FedEx Freight, posted two straight quarters of operating profit, the fourth quarter made it three straight quarters of operating income growth at $30.0 million. Fourth quarter consolidated operating revenue at $1.169 billion was down 3.6 percent annually.

“I am pleased with our overall progress in the fourth quarter and in spite of a weaker than anticipated economy we beat our forecast for the entire year,” said YRC Worldwide CEO James Welch on a conference call this morning. “We accomplished this result in spite of having to dig out of a very tough first quarter, when we reported an operating loss of $49 million.”

Welch said that exceeding the 2012 forecast was extremely important for him and his team as it has engineered a turnaround at both long-haul YRC Freight and its three regional subsidiaries—Holland, New Penn and Reddaway, explaining it wanted to make a mark and establish credibility with shareholders, employees, lenders, and customers. He said they wanted to signal it was a new company with a new management team with a renewed focus on North American LTL operations.

And he said that this management team is committed to consistently delivering improving operating results as it continues to move from an operating and brand-driven focus to a sales and operations driven organization.

“As a management team, we are still a long way away from being satisfied with our operating and financial results,” said Welch. “But 2012 and the fourth quarter results showed meaningful and significant improvement compared to our 2011 results, however, these results are just an indication of what we believe our team can do. Moving into 2013 we are intently focused on continuing to improve and execute at each of our four operating companies.”

2012 operating revenue at YRC Freight—at $3.2 billion—was up 0.1 percent annually, with total tonnage per day and total shipments per day down 2.5 percent and 2.3 percent, respectively. Revenue per hundredweight and revenue per shipment were up 3.1 percent and 2.9 percent, respectively. Fourth quarter revenue for YRC Freight—at $777.2 million—was down 3.4 percent, and total daily tonnage was down 5.5 percent. Total shipments per day were down 5.4 percent, and revenue per hundredweight and revenue per shipment were up 3.2 percent and 3.1 percent, respectively.

Company officials said YRC Freight recorded $21.1 million in positive operating income for the fourth quarter, which was a $47.8 million annual improvement, as well as the second straight positive consolidated operating income quarter.

2012 operating revenue at YRC Regional—at $1.6 billion—was up 5.6 percent annually, with total tonnage per day and total shipments per day up 2.3 percent and 1.3 percent, respectively. Revenue per hundredweight and revenue per shipment were up 3.2 percent and 4.2 percent, respectively. Fourth quarter revenue for YRC Regional—at $391.4 million—was up 2.5 percent, and total daily tonnage was down 1.5 percent. Total shipments per day were down 0.9 percent, and revenue per hundredweight and revenue per shipment were up 3.3 percent and 2.7 percent, respectively.

YRC Freight President Jeff Rogers said on the earnings call that 2012 was a year of progress for the organization, with the financial results serving as evidence of these efforts.

“In 2012, we focused on getting back to the fundamentals of the business, and as a result we made excellent improvements in the areas of safety, customer service and cargo claims,” he said. “We increased our on standard service by ten percentage points while decreasing the standard transit times in nearly half of our lanes.”

And during the fourth quarter Rogers said YRC Freight continued its emphasis on growing the right types of business through its network length of haul and improving its mix, which, among other factors, led to a slight decline in annual volume, while yields are showing positive trends. What’s more, he said the business it is targeting is more profitable and fits its core competencies and is much more efficient on an operational basis.

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


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

Transportation stakeholders reliant on North Carolina’s major seaports are welcoming news this week, which outlines plans to enhance the intermodal and cold chain network in the region.

The index ISM uses to measure non-manufacturing growth—known as the NMI—was 56.9 in February, which was 0.2 percent ahead of January and also 0.1 percent ahead of the 12-month average of 56.8. Economic activity in the non-manufacturing sector has grown for the last 61 months, according to ISM.

Non asset-based third-party logistics (3PL) services and logistics technology services provider Transplace said today that Brooks Bentz has joined the company in a newly-created role as president of Transplace Consulting in conjunction with the launch of the company’s new North American consulting services practice.

The advent of e-commerce continues to grow and gain increased traction over time. The many ways for consumers to order and purchase goods online continues to expand and leads to various subsequent byproducts of online purchases, including shopping through multiple channels, and delivery and payment options, among other things. These types of topics serve as the thesis in the second annual UPS Pulse of the Online Shopper Global Study issued this week by UPS and comScore Inc.

A major highlight of CEVA’s fourth quarter performance was its new business wins, which were up 14 percent for all of 2014, with Freight Management wins up 14 percent, and Ocean Freight and Air Freight wins up 30 percent and 14 percent, respectively, while Contract Logistics wins were up 2 percent.

Article Topics

News · LTL · YRC · YRC Freight · YRC Worldside · All topics

Comments

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


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA