The Overland Park, Kan.-based company said it has retained Credit Suisse Group (CS) 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.
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