Oct. 30, 2009 (PR Newswire) -- OVERLAND PARK, Kan., Oct. 30 /PRNewswire-FirstCall/ --
-- YRC Regional and YRC Logistics Profitable
-- ABS Facility Renewed Early; Extended through October 2010
-- New Long-Term Bank Amendment Provides for Deferral of Interest and Fees
-- Update on Proposed Exchange Offer
YRC Worldwide Inc. (Nasdaq: YRCW) today reported its results for the third quarter and provided an update on its comprehensive plan. For the quarter, the company announced a loss per share of $2.67 that included a net gain on property disposals of $.18 per share, severance charges of $.08 per share due to further headcount reductions and lease termination charges of $.11 per share related to further optimizing the networks. By comparison, the company reported a loss per share in the third quarter of 2008 of $12.58 that included impairment charges on goodwill and intangible assets of $13.20 per share, a curtailment gain of $.84 per share, and a net gain on property disposals of $.21 per share.
"We gained significant momentum in the third quarter as we executed on our comprehensive plan to improve operating efficiencies, restore financial strength and position our company for future success," stated Bill Zollars, Chairman and CEO of YRC Worldwide. "We achieved significant sequential improvement from the first half of the year. In fact, YRC Regional Transportation and YRC Logistics were profitable for the quarter, and our operating cash flow trends improved sequentially during the quarter despite the continued economic downturn."
YRC Worldwide also reported aggregated cash and available unused capacity under the credit facilities of $171 million at September 30, 2009, including $163 million of cash and cash equivalents. In addition, the revolver reserve under the company's credit agreement was $102 million at September 30, 2009. The company expects to commence an exchange offer for its outstanding USF 8-1/2% notes and its contingent convertible notes. The successful completion of this exchange would allow the company to access this revolver reserve under its recently amended credit agreement, therefore providing a significant source of new liquidity. More information regarding the exchange offer and credit agreement is provided below. The company also completed $21 million of sale and financing leaseback transactions and sold $68 million of excess property during the third quarter, including $10 million in pension deferral debt pay downs from these proceeds.
Key Segment Information
Third quarter 2009 compared to the third quarter 2008:
-- YRC National Transportation total shipments per day down 39.9% and total
revenue per hundredweight, including fuel surcharge, down 11.5%.
-- YRC Regional Transportation total shipments per day down 22.7% and total
revenue per hundredweight, including fuel surcharge, down 12.2%.
"Our third quarter sequential shipment trends have dramatically stabilized as compared to the trends from the first half of the year, while we continue to maintain pricing discipline in an increasingly competitive marketplace," said Tim Wicks, President and Chief Operating Officer of YRC Worldwide.
Additional statistical information is available on the company's website at yrcw.com under Investors, Earnings Releases & Operating Statistics.
Asset-Backed Securitization Facility Renewal and Credit Facility Amendment
The company renewed its asset-backed securitization facility ("ABS") early with a total capacity of $400 million through October 2010, which was previously set to expire in February 2010. The due date of the $10 million ABS commitment fee previously payable on October 30, 2009 has also been extended to October 2010. In addition, the company has also amended its credit agreement. The renewed ABS and amended credit agreement provide for a deferral of nearly all of the lender interest and fees effective upon the closing of the note exchange. In the third quarter of 2009, the ABS and credit agreement interest and fees subject to the deferral provisions approximated $25 million. The amended credit facilities include the elimination of the minimum earnings before interest, taxes, depreciation and amortization ("EBITDA") covenants for the fourth quarter of 2009 and the first quarter of 2010, and reset the remaining minimum EBITDA and minimum liquidity covenants. The revolver capacity under the credit agreement remains at $950 million, including the existing revolver reserve amount, which was $106 million as of the date of the amendment. Upon completion of the note exchange, the existing revolver reserve will extend through January 1, 2012. Additional details regarding the amendment to the credit agreement and ABS renewal will be provided in a Form 8-K filed with the SEC today.
"We continue to receive solid support from our lenders as we implement our recovery plan to manage through this severe economic downturn," stated Sheila Taylor, Executive Vice President and CFO of YRC Worldwide. "With 100% of the credit facility and ABS lenders approving the amendments, they have once again demonstrated the belief they have in the value of this company and its potential, as the benefits of our strategic plans become more apparent in our results."
Update on Proposed Note Exchange Offer Discussions
The company is currently in discussions with a committee of its noteholders regarding the terms of a proposed exchange offer for its outstanding USF 8-1/2% notes and its contingent convertible notes. The successful completion of this exchange would allow the company to access the $106 million revolver reserve under its recently amended credit agreement, therefore providing a significant source of new liquidity.
"We have been in active dialogue with our noteholders and feel good about the progress being made. The exchange will be a key milestone in our comprehensive plan which is expected to improve our capital structure, reduce our debt and increase our cash flow," stated Zollars.
Review of Financial Results
YRC Worldwide Inc. will host a conference call for shareholders and the investment community today, Friday, October 30, 2009 beginning at 9:30am ET, 8:30am CT. The conference call will be open to listeners via the YRC Worldwide Internet site yrcw.com. An audio playback will be available after the call also via the YRC Worldwide web site.
IMPORTANT INFORMATION ABOUT THE EXCHANGE OFFER
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This release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any security. An exchange offer will only be made pursuant to exchange offer documents that are to be made available to the holders of the our notes and filed with the Securities and Exchange Commission ("SEC"). Holders of our notes are advised to read the exchange offer documents when they become available, as these documents will contain important information about the exchange offer.
