YRCW to implement reverse stock split this week
Less-than-truckload transportation services provider YRC Worldwide announced that effective Friday, December 2 it will implement a 1:300 reverse split of YRC common stock.
in the NewsSTB reschedules listening session for CSX service issues AAR reports mixed volumes for week ending September 16 Maersk makes bold bid at differentiation by teaming with CRM giant Federal Maritime Commission to take closer look at “Fair Port Practices” CEMA reports unexpectedly strong gains in 2017 More News
Less-than-truckload transportation services provider YRC Worldwide (YRCW) announced that effective Friday, December 2 it will implement a 1:300 reverse split of YRC common stock.
Company officials said that this split was authorized by security holders to the company’s board of directors at the YRCW Annual Meeting of Shareholders will proportionately reduce the number of authorized shares of common stock with the ratio and timing of implementation of the reverse stock split at the discretion of the company’s board of directors.
And they added that the reverse stock split will reduce the number of authorized common shares to approximately 33.3 million from the current 10 billion and reduce the number of outstanding common shares to approximately 6.8 million from the current approximately 2 billion.
“The reverse stock split is an important step in bringing the company into compliance with NASDAQ listing rules and enhances our position as a publicly held company,” said James Welch, chief executive officer of YRC Worldwide. “Now we can focus our attention on serving our customers and providing them with exceptional service.”
For the third quarter, YRCW reported a third quarter net loss of $177.9 million, which was more than double the $61.7 million net loss from a year ago.
Quarterly consolidated operating revenue was $1.276 billion, which was up 12.3 percent annually, and its consolidated operating loss was $24 million, including $12 million in restructuring professional fees and a $15 million non-cash charge for union employee equity awards.
This was the company’s first earnings release since it completed its financial restructuring in July. 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. 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.” YRCW has lost nearly $3 billion over the last four years
And it also marked the first earnings call with new CEO James Welch, YRC operating unit president Jeff Rogers, and CFO Janie Pierson in their respective new positions.
In terms of growing its business for the future, Welch said that YRCW continues to improve service and rationalize its network to be more efficient rather than grow and lead by price. He added that improving service and regaining the confidence of its customers and improving the operations will not occur overnight, but as it gradually plays out, YRCW will be able to seek pricing gains.
“You make money in this business with price and volume,” said Rogers. “By providing a good, consistent service, it allows you to make those decisions a lot better. If you don’t have the service, then you don’t get to choose what you get. As we improve the service, we will get to make those choices and bring on the right type of volume at the right price, which is key. We first need to focus on consistent service.”
The new team under Welch is now able to put more focus on the business side of things, as opposed to financial and banking-related changes, according to Satish Jindel, president of SJ Consulting.
“A focus on having a management team in place that is driven and selected with the objective to help the rank and file—whether they are drivers or dockworkers or salespeople—and to go to customers and show them the level of determination they have to making the company a better run organization and get that extra shipment or two from customers and regain what they had, given its tremendous losses in the $3 billion to $4 billion range over the last several years” will go a long way, Jindel said.
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!
Improving 3PL Management: Glanbia Adds Muscle to Logistics Why Retail Supply Chain Transformations Fail - and how to get it right View More From this Issue