This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Deal: YRC to Study Recap, Refinancing Options

NEW YORK ( The Deal) -- Debt-laden trucking giant YRC Worldwide (YRCW) said Wednesday it is exploring recapitalization options after posting a quarterly loss that riled investors.

The Overland Park, Kan.-based company said it has retained Credit Suisse Group (CS - Get Report) to work with existing financial adviser Maeva Group to assist it in developing "a broad range of refinancing and recapitalization options." The company as of June 30 had long-term debt of $1.29 billion and $165.9 million in cash and equivalents.

YRC took on a substantial amount of debt over the last decade as the former Yellow Corp. used a string of acquisitions to build one of the nation's largest trucking firms, acquiring Roadway Corp. for $1.05 billion in 2003 and later adding USF Corp. in 2005 for $1.47 billion. The company, which was later burdened by the economic decline that cut shipping volume, nearly faced delisting from the Nasdaq in 2011 as it worked out a debt-for-equity swap and issued new shares.

Years later, YRC is still trying to find its way. The company on Wednesday reported a quarterly net loss of $15.1 million, or $1.72 per share, an improvement from a $3.21 per share loss a year prior but well below analyst expectations. Shares of YRC closed down 17.7%, or $5.06, to $23.52 on Wednesday following the announcements.

YRC management said that, despite the poor results, it was making progress in its effort to revamp its organization, telling investors on a conference call that YRC was advancing its network optimization plan as well as rolling out 10,000 handheld devices to enhance driver productivity and overhauling its portfolio of tractors and trailers.

YRC CEO James L. Welch said, "We are continuing to make progress on our turnaround efforts," though noting that "there is still no doubt that many opportunities remain" to further improve operational and financial results. YRC said that its streamlining program was delayed in part due to the company needing extra resources to handle an increase in shipping volume.

The company said that while it took $6.3 million in charges relating to its restructuring in the now-completed second quarter, it expects to see the benefits from those actions in the quarters to come.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
ABFS $34.95 2.22%
YRCW $9.20 0.00%
CS $15.21 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs