YRC losses soar because of winter weather and labor talks
05/01/2014 8:10 AM
05/01/2014 6:31 PM
YRC Worldwide Inc. on Thursday said bad weather and labor negotiations contributed to its first-quarter loss being nearly three times as large as its loss a year ago.
The Overland Park trucking giant lost $70.2 million, or $3.95 a share, compared with a loss of $24.5 million, or $2.93 a share, a year ago. Revenue in the quarter was $1.21 billion, compared with $1.16 billion in the first quarter of 2013.
“This was one of the worst winter seasons in my more than 30 years in trucking,” chief executive James Welch said in the company’s announcement. “We estimate that it negatively impacted our operating income by approximately $20 million.”
YRC said the weather cut into its shipping volumes, decreased its system’s productivity and required it to buy transportation services from other carriers.
An increase in costs from workers’ compensation, bodily injury and cargo claims reduced financial results as well.
Welch had led the company’s campaign to win new concessions from its employees represented by the International Brotherhood of Teamsters, in part by saying the fate of all the company’s jobs were on the line. After a first failed vote on a company proposal late in December, company and union negotiators agreed on terms that Teamsters members approved in January.
In the announcement Thursday, Welch said the cost savings and other benefits the contract agreement provided would take “the better part of 12 months” to gain their full impact on operations.
YRC shares fell $1.49, or 6.6 percent, and closed Thursday at $20.94.
Join the Discussion
The Kansas City Star is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere on the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.