YRC sees revenue climb, profits fall in third quarter

Austin Alonzo
Kansas City Business Journal
November 13, 2013

YRC Worldwide Inc. saw its third-quarter revenue increase by $15.9 million from the same quarter the previous year, and operating income dropped by $21.5 million during the same time period.

The Overland Park-based trucking company (Nasdaq: YRCW) brought in $1.253 billion in consolidated operating revenue in the quarter that ended on Sept. 30. That's up from $1.237 billion in the third quarter of 2013. Consolidated operating income was $5.8 million, down from $27.3 million reported in the same quarter last year.

The loss per share was $4.45, compared with a gain of 40 cents a share during the third quarter of 2012.

The report comes as YRC is asking members of the International Brotherhood of Teamsters to extend the two parties' current labor agreement for an additional five years. The current agreement runs through March 2015.

CEO James Welch has told leaders of the labor union that represents more than 25,000 of the company's 32,000 workers that the union needs to sign on to a new agreement soon for the company to be able to pay its $1.4 billion debt, which starts coming due early next year. If the union does not agree to an extension, the company could be staring down bankruptcy.

The current labor agreement is based on three rounds of concessions the company and the union agreed to between 2008 and 2010. In those concessions, the union consented to a 15 percent cut in wages, suspension of pension payments and reduced vacation time for members. YRC began to make pension payments again in early 2012 at 25 percent of the rate paid in 2009.

The deal saved YRC an estimated $350 million in labor costs annually. It also gave the company's Teamster employees stock and granted the union the right to nominate two members to the YRC board.

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