Reddaway

7720 SW Mohawk St., Bldg. H
Tualatin, OR 97062

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Our Service Coverage

  • Headquarters in Tualatin, Ore.
  • Western United States and Canada
 

News

YRC Worldwide Inc. is Renamed Yellow Corporation

Yellow Corporation Reports Fourth Quarter and Full Year 2020 Results

OVERLAND PARK, Kan.,¬†Feb. 04, 2021¬†(GLOBE NEWSWIRE) --¬†Yellow Corporation¬†(NASDAQ: YRCW) announced today that it has changed its name from¬†YRC Worldwide Inc.¬†to¬†Yellow Corporation¬†and it will begin trading under the NASDAQ ticker symbol YELL effective¬†February 8, 2021. The Company’s LTL brands¬†Holland, New Penn, Reddaway and YRC Freight, as well as¬†HNRY Logistics¬†continue to operate under their existing names.

“As we continue our transformation into a super-regional, LTL freight carrier, it is the right time to reintroduce the¬†Yellow Corporation¬†name and modernize the holding company brand,” said¬†Darren Hawkins, Chief Executive Officer. Once we announced our plans to rebrand, our customers and employees shared their excitement. The Yellow brand is synonymous with the LTL industry and we are honored to continue its proud legacy of service with one of the largest, most comprehensive logistics and LTL networks in North America.¬†¬†

“Migrating to one Yellow technology platform and creating one Yellow network are the key enablers of our enterprise transformation strategy, which is to provide a superior customer experience under one Yellow brand.”

The Company also reported results for fourth quarter and year ended December 31, 2020.

Fourth quarter 2020 operating revenue was $1.165 billion and operating income was $13.7 million. In comparison, operating revenue in fourth quarter 2019 was $1.160 billion and operating income was $9.8 million, which included a $10.1 million net gain on property disposals.

Operating revenue for full year 2020 was $4.514 billion and operating income was $56.5 million, which included a $45.3 million net gain on property disposals. This compares to full year 2019 operating revenue of $4.871 billion and operating income of $16.2 million, which included a $13.7 million net gain on property disposals and $8.2 million for a non-cash impairment charge related to the write-down of an intangible asset.

Net loss for fourth quarter 2020 was¬†$18.7 million, or¬†$0.37¬†per share compared to net loss of¬†$15.3 million, or¬†$0.46¬†per share, in fourth quarter 2019. Full year net loss for 2020 was¬†$53.5 million, or¬†$1.28¬†per share, compared to a full year net loss in 2019 of¬†$104.0 million, or¬†$3.13¬†per share, which included a¬†$11.2 million¬†loss on extinguishment of debt associated with a refinancing of the Company’s term loan agreement.¬†¬†

Hawkins continued “During the fourth quarter volume and pricing continued to improve in a tighter capacity environment. As the industrial and retail segments of the economy rebound a shortage of drivers is keeping a lid on LTL capacity. Overall, the industry is stable and well positioned for a strong 2021.

“With a strong liquidity position of¬†$440 million¬†at the end of 2020, along with the next¬†$176 million¬†of CARES Act loan Tranche B funds that we received in January, we are positioned to continue making significant investments into our business. We expect capital expenditures in 2021 to be in the range of¬†$450 million¬†to¬†$550 million, with planned investments in tractors, trailers, technology, box trucks, containers, liftgates and other assets. Much of the new equipment is expected to enhance safety and improve fuel efficiency.

“In addition to a robust capital expenditure plan our key priorities in 2021 include meeting our customers’ evolving needs, mitigating increased purchased transportation expense and remaining focused on hiring and training drivers in a capacity constrained marketplace.

“During a challenging and unprecedented 2020, our nearly 30,000 employees persevered, continuing their essential service for our customers and the communities we serve with a proud sense of patriotism. They are heroes and their dedication and commitment are greatly appreciated. I have never been prouder of our team,” concluded Hawkins.

Financial Update

  • On a non-GAAP basis, the Company generated Adjusted EBITDA of¬†$57.9 million¬†in fourth quarter 2020, a¬†$10.6 million¬†increase compared to¬†$47.3 million¬†in the prior year comparable quarter (as detailed in the reconciliation below). Last twelve months (LTM) Adjusted EBITDA was¬†$191.9 million¬†compared to¬†$210.6 million¬†in 2019 (as detailed in the reconciliation below).

  • In fourth quarter 2020 the Company invested¬†$99.2 million¬†in capital expenditures which is equal to 8.5% of operating revenue. This compares to¬†$31.7 million¬†in capital expenditures and¬†$18.5 million¬†in capital value equivalent in new operating leases, for a total of¬†$50.2 million¬†and 4.3% of operating revenue in fourth quarter 2019.

Operational Update

  • The operating ratio for fourth quarter 2020 was 98.8 compared to 99.2 in fourth quarter 2019.

  • Fourth quarter LTL revenue per hundredweight, excluding fuel surcharge, increased 2.2% and LTL revenue per shipment increased 4.8% compared to the same period in 2019. Including fuel surcharge, fourth quarter LTL revenue per hundredweight decreased 0.7% and LTL revenue per shipment increased 1.8%.

  • Fourth quarter 2020 LTL tonnage per day increased 2.4% when compared to fourth quarter 2019. ¬†¬†

Liquidity Update

  • The Company’s available liquidity, which is comprised of cash and cash equivalents and Managed Accessibility (as detailed in the supplemental information provided below) under its ABL facility, was¬†$440.2 million¬†as of¬†December 31, 2020¬†compared to¬†$80.4 million¬†in the prior year, an increase of¬†$359.8 million.

  • The Company’s outstanding debt was¬†$1.284 billion¬†as of¬†December 31, 2020, an increase of¬†$381.2 million¬†compared to¬†$902.8 million¬†as of¬†December 31, 2019.

  • For full year 2020, cash provided by operating activities was¬†$122.5 million¬†compared to¬†$21.5 million¬†in 2019.

Key Information¬†‚ÄstFourth quarter 2020 compared to fourth quarter 2019

        
2020
   
2019
  Percent
Change(a)
Workdays     60.5     62.0    
Operating revenue (in millions)     $     1,164.5   $ 1,159.5   0.4%  
Operating income (in millions)   $          13.7   $           9.8   39.8%  
Operating ratio     98.8     99.2   0.4 pp  
LTL tonnage per workday (in thousands)     40.22     39.28   2.4%  
LTL shipments per workday (in thousands)     69.03     69.10   (0.1)%  
LTL picked up revenue per hundredweight incl FSC   $        21.46     $       21.60   (0.7)%  
LTL picked up revenue per hundredweight excl FSC
LTL picked up revenue per shipment incl FSC
LTL picked up revenue per shipment excl FSC
LTL weight/shipment (in pounds)
  $
$
$

19.46
250
227
1,165
  $
$
$
19.04
246
216
1,137
  2.2%
1.8%
4.8%
2.5%
 
Total tonnage per workday (in thousands)     51.81     49.82   4.0%  
Total shipments per workday (in thousands)     70.88     70.68   0.3%  
Total picked up revenue per hundredweight incl FSC   $    18.33   $         18.50   (1.0)%  
Total picked up revenue per hundredweight excl FSC
Total picked up revenue per shipment incl FSC
Total picked up revenue per shipment excl FSC
Total weight/shipment (in pounds)
  $
$
$
16.67
268
244
1,462
  $
$
$
16.37
261
231
1,410
  1.9%
2.7%
5.6%
3.7%

 
             

Key Information¬†‚ÄstFull year 2020 compared to full year 2019


   
2020
   
2019
  Percent
Change(a)
Workdays     253.0     251.5    
Operating revenue (in millions)     $ 4,513.7   $ 4,871.2   (7.3)%  
Operating income (in millions)   $ 56.5   $ 16.2   NM  
Operating ratio     98.7     99.7   1.0 pp  
LTL tonnage per workday (in thousands)     38.91     41.01   (5.1)%  
LTL shipments per workday (in thousands)     67.12     72.55   (7.5)%  
LTL picked up revenue per hundredweight incl FSC   $ 20.82    $ 21.61   (3.6)%  
LTL picked up revenue per hundredweight excl FSC
LTL picked up revenue per shipment incl FSC
LTL picked up revenue per shipment excl FSC
LTL weight/shipment (in pounds)
  $
$
$
18.78
241
218
1,159
  $
$
$
19.05
244
215
1,131
  (1.4)%
(1.2)%
1.1%
2.6%
 
Total tonnage per workday (in thousands)     49.76     51.47   (3.3)%  
Total shipments per workday (in thousands)     68.96     74.17   (7.0)%  
Total picked up revenue per hundredweight incl FSC   $ 17.82   $ 18.66   (4.5)%  
Total picked up revenue per hundredweight excl FSC
Total picked up revenue per shipment incl FSC
Total picked up revenue per shipment excl FSC
Total weight/shipment (in pounds)

  $
$
$
16.13
257
233
1,443
  $
$
$
16.50
259
229
1,388
  (2.3)%
(0.7)%
1.6%
4.0%

 

      (a)   Percent change based on unrounded figures and not the rounded figures presented

Review of Financial Results

Yellow Corporation will host a conference call with the investment community today, Thursday, February 4, 2021, beginning at 5:00 p.m. ET.

A live audio webcast of the conference call and presentation slides will be available on Yellow Corporation’s website¬†www.myyellow.com.¬†A replay of the webcast will also be available at¬†www.myyellow.com

Non-GAAP Financial Measures

EBITDA is a non-GAAP measure that reflects the company’s earnings before interest, taxes, depreciation, and amortization expense. Adjusted EBITDA is a non-GAAP measure that reflects EBITDA, and further adjusts for¬†letter of credit fees, equity-based compensation expense, net gains or losses on property disposals, restructuring charges, transaction costs related to issuances of debt, non-recurring consulting fees, non-cash impairment charges and the gains or losses from permitted dispositions, discontinued operations, and certain non-cash expenses, charges and losses (provided that if any of such non-cash expenses, charges or losses represents an accrual or reserve for potential cash items in any future period, the cash payment in respect thereof in such future period will be subtracted from Adjusted EBITDA in such future period to the extent paid). Adjusted EBITDA as used herein is defined as Consolidated EBITDA in our UST Credit Agreements and Term Loan Agreement (collectively, the “TL Agreements”). EBITDA and Adjusted EBITDA are used for internal management purposes as a financial measure that reflects the company’s core operating performance. In addition, management uses¬†Adjusted EBITDA to¬†measure compliance with financial covenants in our TL Agreements and to determine certain incentive compensation.¬†We believe our presentation of EBITDA and Adjusted EBITDA is¬†useful to investors and other users as these measures represent key supplemental information our management uses to compare and evaluate our core underlying business results, particularly in light of our leverage position and the capital-intensive nature of our business. Further, EBITDA is a measure that is commonly used by other companies in our industry and provides a comparison for investors to evaluate the performance of the companies in the industry. Additionally, Adjusted EBITDA helps investors to understand how the company is tracking against our financial covenants in our TL Agreements.

EBITDA and Adjusted EBITDA have the following limitations:

  • EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or fund principal payments on our outstanding debt;

  • Adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or fund principal payments on our outstanding debt, letter of credit expenses, restructuring charges, transaction costs related to debt, non-cash charges, charges or losses (subject to the conditions above), or nonrecurring consulting fees, among other items;

  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will have to be replaced in the future and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements;

  • Equity-based compensation is an element of our long-term incentive compensation program for certain employees, although Adjusted EBITDA excludes employee equity-based compensation expense when presenting our ongoing operating performance for a particular period; and

  • Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, our non-GAAP measures should not be considered a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using our non-GAAP measures as secondary measures. The company has provided reconciliations of its non-GAAP measures to GAAP net income (loss) within the supplemental financial information in this release.

Cautionary Note on Forward-Looking Statements

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Words such as “will,” “expect,” “intend,” “anticipate,” “believe,” “could,” “would,” “should,” “may,” “project,” “forecast,” “look forward,” “propose,” “plan,” “designed,” “enable,” and similar expressions which speak only as of the date the statement was made are intended to identify forward-looking statements. Forward-looking statements are inherently uncertain, are based upon current beliefs, assumptions and expectations of Company management and current market conditions, and are subject to significant business, economic, competitive, regulatory and other risks, uncertainties and contingencies, known and unknown, many of which are beyond our control. Our future financial condition and results could differ materially from those predicted in such forward-looking statements because of a number of factors, including (without limitation) general economic factors and transportation industry-specific economic conditions, including the impact of COVID-19; our ability to generate sufficient liquidity to satisfy our cash needs and future cash commitments, including (without limitation) the impact of COVID-19 on our¬†results of operations, financial condition and cash flows; our obligations related to our indebtedness and lease and pension funding requirements, and our ability to achieve increased cash flows through improvement in operations; our failure to comply with the covenants in the documents governing our existing and future indebtedness; customer demand in the retail and manufacturing sectors; business risks and increasing costs associated with the transportation industry, including increasing equipment, operational and technology costs and disruption from natural disasters; competition and competitive pressure on pricing; the risk of labor disruptions or stoppages, if our relationship with our employees and unions were to deteriorate; increasing pension expense and funding obligations, subject to interest rate volatility; increasing costs relating to our self-insurance claims expenses; our ability to finance the maintenance, acquisition and replacement of revenue equipment and other necessary capital expenditures; our ability to comply and the cost of compliance with, or liability resulting from violation of, federal, state, local and foreign laws and regulations, including (without limitation) labor laws and laws and regulations regarding the environment; impediments to our operations and business resulting from anti-terrorism measures; the impact of claims and litigation expense to which we are or may become exposed; failure to realize the expected benefits and costs savings from our performance and operational improvement initiatives; our ability to attract and retain qualified drivers and increasing costs of driver compensation; a significant privacy breach or IT system disruption; risks of operating in foreign countries; our dependence on key employees; seasonality; shortages of fuel and changes in the cost of fuel or the index upon which we base our fuel surcharge and the effectiveness of our fuel surcharge program in protecting us against fuel price volatility; limitations on our operations, our financing opportunities, potential strategic transactions, acquisitions or dispositions resulting from restrictive covenants in the documents governing our existing and future indebtedness; fluctuations in the price of our common stock; dilution from future issuances of our common stock; our intention not to pay dividends on our common stock; that we have the ability to issue preferred stock that may adversely affect the rights of holders of our common stock; and other risks and contingencies, including (without limitation) the risk factors that are included in our reports filed with the¬†SEC, including those described under “Risk Factors” in our annual report on Form 10-K and quarterly reports on Form 10-Q.

About Yellow Corporation

Yellow Corporation has one of the largest, most comprehensive logistics and less-than-truckload (LTL) networks in North America with local, regional, national, and international capabilities. Through our teams of experienced service professionals, Yellow Corporation offers industry-leading expertise in flexible supply chain solutions, ensuring customers can ship industrial, commercial, and retail goods with confidence. Yellow Corporation, headquartered in Overland Park, Kan., is the holding company for a portfolio of LTL brands including Holland, New Penn, Reddaway, and YRC Freight, as well as the logistics company HNRY Logistics.

Please visit our website at www.myyellow.com for more information.

Investor Contact: Tony Carre√Īo
  913-696-6108
  investor@myyellow.com
       
Media Contact: Mike Kelley
  913-696-6121
  mike.kelley@myellow.com

 SOURCE: Yellow Corporation