View FAQs by category: Finance | Past Developements
A: That wording fulfills our obligation to disclose risks to our investors. We have confidence that our note holders understand the value of our company and will exchange the notes. Our confidence is based on discussions with the note holders prior to filing and action in the bond markets. The trading value of these bonds has increased since we announced our intention to launch the offer.
A. Overall, we gained significant momentum in the third quarter. YRC Regional Transportation and YRC Logistics achieved profitability, and our operating cash flow trends improved during the quarter despite the economy. We showed significant sequential improvement with a loss per share of $2.67 versus a loss of $5.20 for the second quarter of '09. The trends are good and our actions continue to drive further improvements.
A. Part of our loss in the third quarter is attributable to severance charges incurred as we reduced our headcount. There were also lease termination charges that are part of further optimizing our networks. We did realize a net gain of 18 cents per share on property disposals. We completed $21 million in sale/leaseback agreements during the third quarter, and sold $68 million worth of excess property.
Despite progress on our comprehensive plan, the operating environment remains very challenging. We continue to face a difficult economy that appears to have stabilized but has not shown any sustained positive momentum. We remain cautiously optimistic that the economy has bottomed out but it is still too early to know for sure.
A. The financial news announced Oct. 30, 2009, highlights the solid support we continue to receive from our lenders as we implement our comprehensive strategic plan. As the news release stated, we completed an early renewal of our ABS facility for $400 million through October 2010; it had been set to expire in February 2010. We also gained liquidity with an extension of the $10 million ABS commitment fee. It was due on October 30, 2009, and has been extended to October 2010. The renewed ABS and amended credit facilities also allow us to defer about $25 million per quarter in interest payments and fees, once we close a note exchange offer.
A. The amended credit facilities announced Oct. 30, 2009, 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 success of the note exchange, the existing revolver reserve will extend through January 1, 2012.
A. We continue working closely with the Teamsters. Our union employee-owners -- along with our non-union employee-owners -- are essential stakeholders in the implementation of our comprehensive strategic plan. In an unprecedented move, union employees at YRC Worldwide ratified two agreements within eight months. These agreements will contribute an estimated $2 billion in savings over the life of the contract.
A. YRC Worldwide remains operationally and financially viable, and we are taking a number of steps to ensure that we will continue to be well into the future. Our financial results don't reflect our operational ability to deliver on our promise. The YRC network is already performing at levels better than pre-integration in terms of delivery service and customer service response. Finally, the efficiency and effectiveness improvements at our regional companies will further enhance our industry-leading next-day and regional services.
It is important to remember that we have decades of experience across our brands and we have managed through downturns before. We have a solid portfolio of brands and offer a comprehensive array of solutions for the shipment of industrial, commercial and retail goods domestically and internationally.
A. Our actions over the last year have been doubted by some every step of the way and we continue to prove the naysayers wrong. We are working our plan and the plan is working. That plan includes restructuring our management team, reducing headcount and working with pension plans.
YRC Worldwide recently announced expanded roles for two key leaders in our organization, Tim Wicks and Sheila Taylor. Wicks is now President and Chief Operating Officer; Taylor is Executive Vice President and Chief Financial Officer. Wicks and Taylor play integral roles in the implementation of our comprehensive strategic plan, and will expand their positive organizational impact with these new responsibilities.
Both union and non-union employee owners at YRC Worldwide are contributing to our cost savings. Modified agreements with the Teamsters will contribute an estimated $2 billion in savings over the life of the contract. We expect an estimated $75 million per year in savings from reductions to the wages and benefits of non-union employees. In addition, we have reduced headcount throughout the organization -- our reported loss in the third quarter includes severance charges of $.08 per share due to further headcount reductions.
We're also working with the pension plans, and have reached a new agreement on payment deferrals for the third quarter. We continue to support and work toward long-term solutions to multi-employer pension plans that will preserve retiree benefits. Our efforts include discussions with the federal government on more equitable legislation.
A. One of our strengths as YRC Worldwide is our comprehensive service portfolio -- from regional, next-day deliveries to global logistics. Our regional transportation companies, including Holland, Reddaway, and New Penn, are leaders in next-day service in their areas and together cover the nation with next-day, second-day and time-sensitive services. As part of the YRC Worldwide family of brands, our regional companies continue to deliver award winning regional service with some of the lowest claims ratios in the industry.
A. Yes. We realized a net gain of 18 cents per share on property disposals in Q3 2009. We completed $21 million in sale/leaseback agreements during the third quarter, and sold $68 million worth of excess property. Sale and financing leaseback transactions are now expected to generate around $400 million of cash proceeds and excess property sales should generate over $100 million in 2009.
A. YRC Worldwide reported aggregated cash and available unused capacity under the credit facilities of $171 million at Sept. 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 Sept. 30, 2009.
A. Our size and scale enables us to offer the combination of experience, reliability and comprehensive solutions that our competitors simply cannot. As you know, YRC Worldwide is built on the distinguished heritage of several leading and highly respected transportation companies. With many years of experience in moving big shipments, our customers benefit from the most collective expertise in the industry.
A. We have retained several key advisors that are involved with many of our initiatives, including operational improvements and communications with our lender group and several significant debt holders. This allows us to tap into specific experts in these areas while our management team remains focused on our core business and taking care of our customers.
A. Rothschild is recognized for its ability to help companies in a variety of areas, and that's why we hired them several months ago. Given the re-engineering of our YRC network and other business actions, we felt their experience and guidance would be very valuable. At the moment, we are tapping their expertise for preliminary discussions with several significant holders of our debt securities.
A. Choice in the marketplace gives you a competitive advantage. Strong YRC Worldwide brands provide you with transportation and logistics solutions that run the gamut -- from the best regional, next-day service to comprehensive global logistics capabilities. We bring you the most comprehensive network in North America, run by the finest experts in the business. Choice means you have better options. We're good for your business.
A. In addition to a 5 percent incremental wage reduction, the agreement includes an 18-month cessation of union pension fund contributions, which will not require repayment at a later date. In exchange, our Teamsters employees will receive options for 20 percent of the outstanding shares of YRC Worldwide stock, pending shareholder approval. This will allow them to further share in future company performance through stock price appreciation.
A. The modified agreement makes an immediate difference, with estimated monthly savings of approximately $45 million in 2009, growing to approximately $50 million per month savings in 2010.
A. The announcement from Central States was one of the necessary steps required to adopt the 18-month cessation of pension plan payments, with no requirement for repayment. The action also required the approval of our Teamsters employees, granted as part of the ratification vote.
While the announcement attracted attention, it was simply a formal notification that YRC Worldwide is temporarily terminated as a contributing employer and that no withdrawal liability will be assessed, since we are expected to come back as a contributing employer following the 18-month period spelled out in the modified agreement.
A. Yes. We expect other pension plans to formally announce they are terminating our participation with no penalty. The timing will vary.
A. We finalized agreements with all of our Teamsters multi-employer pension funds, which allow us to defer $128 million in contributions. Some of the company's real estate is used as collateral in lieu of the pension contributions.
These agreements provide relief from our immediate funding obligations to the pension funds, and are important milestones in our overall strategy to provide our company with greater financial flexibility, giving us additional liquidity and the ability to use our cash to support our business during these difficult economic times.
A. These amendments allow us to retain and improve the liquidity position of YRC Worldwide as well as provide covenant flexibility. It gives us the time to realize the anticipated benefits from our network integration and other cost-savings actions.
A. We want to have the flexibility to be responsive in a volatile environment. With that in mind, we will continue to monitor the financial markets and evaluate all of our opportunities, including the possibility of issuing more stock, as the year progresses.
Statements made in this document that are not purely historical are forward-looking statements. This includes statements regarding the company's expectations and intentions on strategies regarding the future. It is important to note that the company's future results could differ materially from those projected in such forward-looking statements due to a variety of factors. The format of this document does not allow us to fully discuss all of these risk factors. For a full discussion, please refer to our earnings release and our SEC filings, including our 10K and 8K filing.
Home | Videos | Financial Updates | FAQs | Industry Insights | Exhibits & Tradeshows | Search
YRC | YRC Reimer | YRC Glen Moore | YRC Logistics | New Penn | Holland | Reddaway
Copyright © 2009 YRC Worldwide Inc. Notice and Legal Disclaimer. Privacy Policy. YRC Worldwide Inc.