As YRC Worldwide readies its second quarter results, analysts, investors and YRC’s competitors are eager to gauge whether the trucking giant will survive the recession and emerge a leaner, more competitive transportation player or fall into bankruptcy.
The Overland Park, Kan.-based company is expected to post another quarterly loss, following a $257.4 million loss in the first quarter and a cumulative $1.6 billion loss in 2007 and 2008.
The second quarter results will help analysts and investors benchmark how well the company’s efforts to reverse course and return to profitability are working.
YRC Worldwide has as laid off thousands of workers, reduced wages 10 percent and cut or frozen benefits, sold hundreds of millions of dollars in property, and renegotiated banking agreements several times this year alone.
It merged the networks of its two original less-than-truckload carriers, Yellow Transportation and Roadway, this March and renamed the carrier YRC.
The company and the Teamsters union on July 9 agreed to a second round of labor concessions that include an additional 5 percent wage cut and an 18-month suspension of Teamster pension contributions.
In return, the Teamsters would gain a greater say in how the company is run, and the option to purchase up to 35 percent of YRC Worldwide’s common stock.
The company’s 35,000 Teamster employees are voting on the proposal, and ballots are due Aug. 6. The concessions would save YRC more than $800 million over the next year and a half.
That would be enough to keep the company on the road through 2009, analysts said. How the company fares in 2010 will depend on how well its reorganization works and the state of the economy.
YRC — which commands about 20 percent of the LTL market, according to analysts — hasn’t had a profitable year since 2006, when it was a $9.9 billion enterprise. Last year it had about $8.9 billion in revenue.
The company is the largest operator of unionized LTL carriers in the United States, including its national LTL carrier, YRC, and regional LTL carriers Holland, Reddaway and New Penn. The company also operates truckload carrier YRC Glen Moore and Canadian LTL carrier YRC Reimer.
YRC Worldwide Chairman, President and CEO William D. Zollars will host a conference call beginning 4:30 pm Eastern Time July 30. Its earnings will be released at approximately 4:15 pm Eastern Time.
The conference call will be available to listeners the YRC Worldwide Internet site yrcw.com. Recorded playback of the call will be available via yrcw.com.
Contact William B. Cassidy at firstname.lastname@example.org.