![]() InvestorPresentation November 2010 Exhibit 99.1 |
![]() 2 Overview Overview Opening Comments Strategy Stakeholder Support New Labor Contract Operating Improvements and Key Milestones Liquidity Summary |
![]() 3 Business Segments Business Segments The companys National and Regional networks provide the most comprehensive North American network and flexible solutions to meet its customers diverse transportation needs Sale of YRC Logistics allows YRCW to focus on its core businesses Customers maintain access to logistics services via commercial services agreement Transportation & Logistics Transportation & Logistics North American LTL & TL North American LTL & TL U.S. National LTL Inter/Intra-Canada LTL Truckload Regional LTL Regional LTL Global Logistics Global Logistics Western U.S. & Canada Central U.S. & Canada Northeast U.S. & Canada China Ground, Global Forwarding Jiayu Jing Jiang 73% $1.3 Billion 27% YRC Worldwide Inc. 2009 Revenue: $4.9 Billion (1) (1) Adjusted to exclude $.4 billion revenue from YRC Logistics segment reported asdiscontinued operations effective 2Q 2010. $3.6 Billion $40 million / $265 million |
![]() 4 National and Regional Networks National and Regional Networks 4 Strategy: Achieve competitive cost base and enhanced customer mix management, resulting in improved earnings and cash flows |
![]() Stakeholder Support Stakeholder Support 5 Stakeholders alignment to ensure future success Liquidity programs Sale of assets Deferral of pension contributions Lender flexibility Addressed 2010 bond obligations Converted $470 million of bonds to equity Refinanced remaining bonds with $70 million of new 6% notes Competitive cost base Customer confidence |
![]() 6 Labor Contract Overview Labor Contract Overview Extended by two years from 2013 to March 31, 2015 Re-entry of YRCW companies into multi-employer pension plans in June 2011, at a more affordable level of contribution Sustains the current competitive cost structure and improves future operating leverage, as work rule changes drive cost efficiencies to more than offset returning pension contributions and to promote service enhancements Addresses the long-term market competitiveness of YRCW, which is designed to protect jobs, enable long-term growth and generate financial returns to its stakeholders ABF lawsuit update |
![]() 7 Key Financial Recovery Milestones
to Date Key Financial Recovery Milestones
to Date 2Q and 3Q 2009 sequential improvement in adjusted EBITDA 4Q 2009 sequential and year-over-year improvement in adjusted EBITDA March 2010 volume growth returns April 2010 breakeven adjusted EBITDA 2Q 2010 positive adjusted EBITDA quarter, first since 3Q 2008 3Q 2010: Second consecutive quarter of positive adjusted EBITDA Positive cash flow from operating activities Regional operating ratio 97.6 National operating ratio 102.9 YRCW operating ratio improved 8.8 year-over-year |
![]() Year-Over-Year Operating Improvement Year-Over-Year Operating Improvement Cost actions, price discipline, and customer mix management Expect YRCW to be adjusted EBITDA positive in 4Q 2010 Adjusted EBITDA is a non-GAAP measure that reflects the companys earningsbefore interest, taxes, depreciation, and amortization expense, and further adjusted for letter of credit fees, professional restructure fees, discontinuedoperations, and other items as defined in the companys Credit Agreement. Adjusted EBITDA is used for internal management purposes as a financial measure that reflectthe companys core operating performance and is used by management tomeasure compliance with financial covenants in the companys Credit Agreement. This financial measure should not be construed as a better measurement than operating income as defined by generally accepted accounting principles. SeePages15 and16 for reconciliations of GAAP measures to non-GAAP financialmeasures. 8 Operating Loss (in millions) Adjusted EBITDA (in millions) |
![]() Tonnage Per Day Trends Sequential volume improvement trends National up 1.2% from 2Q 2010; second consecutive sequential increase Regional up 2.1% from 2Q 2010; year-over-year up 9% Market share stabilized during 2Q & 3Q; now positioned for future profitablegrowth 9 |
![]() 10 Liquidity Liquidity Stable liquidity position Proactive actions to fund working capital for revenue growth DSO improvement 3 days year-over-year Renewal of $325 million asset-backed securitization through October 2011 Note: Revolver reserves are subject to the terms of the companyscredit agreement with its lenders. |
![]() 11 Summary Summary Strategic focus on core business Improving operational performance Stakeholder alignment Customer confidence |
![]() 12 Appendix |
![]() 2010Expectations 2010 Expectations YRCW positive adjusted EBITDA and be well within credit agreement financial covenants in 4Q 2010 Gross capital expenditures of $20 to $30 million Excess property sales of $70 to $80 million Sale and financing leasebacks approximately $50 million Effective income tax rate of 3% 13 |
![]() CommonShare Recap Pre-Split and Post-Split Common Share Recap Pre-Split andPost-Split 14 Authorized Outstanding (1) 6% Notes (2) Options/RSUs (3) Available Jun 30 2 billion 1.124 billion 202 million/ $70M 350 million 324 million Post 1:25 Split Jun 30 (pro forma) 80 million 45 million 8 million 14 million 13 million Sep 30 80 million 47.5 million 5.5 million/ $69.410M 14 million 13 million 1) Per third quarter 2010 10-Q 2) Pro forma amounts, assuming $70m notes are fully converted into shares, inclusive of interest and make-whole amounts paid in shares; represents an all-in conversion rate of approximately $8.67/share ($0.35/share pre-split) a) In August 2010, the company temporarily modified the conversion ratio to $0.25/share($0.01/share pre-split) and issued 2.4m shares (59m pre-split) in conversion of $590,000 of notes. In addition, the company issued 0.2 m shares (5.5m pre-split)for semi-annual interest due August 15, 2010. b) Remaining 5.5m shares relate to outstanding notes of $69.41m or an all-in conversion ratio of approximately $12.61 per share for future conversions (approximately $.50/share pre-split). 3) Includes June 2010 Teamster option awards of 10.5m (264m pre-split) with a strikeprice of $12/share ($0.48/share pre-split), June 2010 shareholder approval of 2.7m shares (67m pre-split) for the non-union equity plan which are available for future equityawards and 2009 employee awards (union and non-union) of 0.6m (15m pre-split). |
![]() Consolidated Adjusted EBITDA Consolidated Adjusted EBITDA 15 For the Three and Nine Months Ended September 30 2010 2009 2010 2009 Operating revenue 1,136,836 $ 1,203,977 $ 3,243,081 $ 3,820,916 $ Operating Ratio, as adjusted 101.7% 110.5% 105.5% 120.4% Reconciliation of operating loss to adjusted EBITDA: Operating loss (18,836) $ (126,648) $ (203,726) $ (799,556) $ Union equity awards - - 24,995 20,639 Operating loss, as adjusted (18,836) (126,648) (178,731) (778,917) (Gains) losses on property disposals, net (3,429) (11,138) 3,183 (10,579) Impairment charges - - 5,281 - Depreciation and amortization 49,785 58,346 150,491 181,173 Equity based compensation expense 2,211 2,032 5,545 8,147 Letter of credit expense 8,321 8,838 24,943 23,301 Restructuring professional fees 6,594 n/a 15,936 n/a Reimer Finance Co. dissolution (foreign exchange) n/a n/a 5,540 n/a Other nonoperating, net (312) (2,018) 1,029 (4,495) Adjusted EBITDA 44,334 $ (70,588) $ 33,217 $ (581,370) $ Operating Ratio, as adjusted is calculated as 100 minus the result of dividing operating income,as adjusted by operating revenue or plus the result of dividing operating loss, as adjusted byoperating revenue, and expressed as a percentage. Three Months Nine Months SUPPLEMENTAL FINANCIAL INFORMATION YRC Worldwide Inc. and Subsidiaries (Amounts in thousands) (Unaudited) |
![]() 2010Consolidated Operating Cash Flows 2010 Consolidated Operating Cash Flows 16 YRC Worldwide Inc. and Subsidiaries (Amounts in thousands) (Unaudited) 1Q 2010 2Q 2010 3Q 2010 Reconciliation of Adjusted EBITDA to net cash from (used in) operating activities: Adjusted EBITDA (51,034) $ 39,917 $ 44,334 $ Add back amounts included in Adjusted EBITDA: Restructuring professional fees n/a (9,342) (6,594) Discontinued operations and permitted dispositions (2,135) (7,421) 1,347 Cash interest (10,876) (10,062) (11,009) Working capital cash flows, net 1,063 (47,870) (22,678) Net cash used in operating activities before income taxes (62,982) (34,778) 5,400 Cash income tax refunds, net 81,272 2,016 (253) Net cash (used in) provided by operating activities 18,290 $ (32,762) $ 5,147 $ |
![]() 17 Forward-Looking Statements Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words believe, expect, continue, and similar expressions are intended to identify forward-looking statements. It is important to note that the companys actual future results could differ materially from those projected in such forward-looking statements because of a number of factors, including (among others) our ability to generate sufficient cash flows and liquidity to fund operations, which raises substantial doubt about our ability to continue as a going concern, inflation, inclement weather, price and availability of fuel, sudden changes in the cost of fuel or the index upon which the company bases its fuel surcharge, competitor pricing activity, expense volatility, including (without limitation) expense volatility due to changes in rail service or pricing for rail service, ability to capture cost reductions, changes in equity and debt markets, a downturn in general or regional economic activity, effects of a terrorist attack, labor relations, including (without limitation) the impact of work rules, work stoppages, strikes or other disruptions, any obligations to multi-employer health, welfare and pension plans, wage requirements and employee satisfaction, and the risk factors that are from time to time included in the companys reports filed with the SEC. The companys expectations regarding the rate and timing of pricing and revenue mix improvements are only its expectations regarding these matters. Actual rate and timing of pricing and revenue mix improvements could differ based on a number of factors including (among others) general economic trends and excess capacity within the industry, and the factors that affect revenue results (including the risk factors that are from time to time included in the companys reports filed with the SEC). The companys expectations regarding the timing and degree of market share growth are only its expectations regarding these matters. Actual timing and degree of market share growth could differ based on a number of factors including (among others) the companys ability to persuade existing customers to increase shipments with the company and to attract new customers, and the factors that affect revenue results (including the risk factors that are from time to time included in the companys reports filed with the SEC). The companys expectations regarding the impact of, and the service and operational improvements and collateral and cost reductions due to, the integration of Yellow Transportation and Roadway, improved safety performance, right-sizing the network, consolidation of support functions, the companys credit ratings and the timing of achieving the improvements and cost reductions could differ materially from actual improvements and cost reductions based on a number of factors, including (among others) the factors identified in the preceding and following paragraphs, the ability to identify and implement cost reductions in the time frame needed to achieve these expectations, the success of the companys operating plans and programs, the companys ability to successfully reduce collateral requirements for its insurance programs, which in turn is dependent upon the companys safety performance, ability to reduce the cost of claims through claims management, the companys credit ratings and the requirements of state workers compensation agencies and insurers for collateral for self- insured portions of workers compensation programs, the need to spend additional capital to implement cost reduction opportunities, including (without |
![]() Forward-Looking Statements Forward-Looking Statements 18 limitation) to terminate, amend or renegotiate prior contractual commitments, the accuracy of the companys estimates of its spending requirements, changes in the companys strategic direction, the need to replace any unanticipated losses in capital assets, approval of the affected unionized employees of changes needed to complete the integration under the companys union agreements, the readiness of employees to utilize new combined processes, the effectiveness of deploying existing technology necessary to facilitate the combination of processes, the ability of the company to receive expected price for its services from the combined network and customer acceptance of those services. The company's expectations regarding the lawsuit filed by ABF are only its expectations regarding this matter. The actual outcome of ABF lawsuit is dependent on final resolution of the claims through the courts or grievance process under the company's labor agreement. The company's expectations regarding the amount and timing of receipt of a working capital adjustment in connection with the sale of a majority of its Logistics business are only its expectations regarding these matters. The actual amount and timing of receipt of a working capital adjustment is dependent on final resolution of the amount with the buyer of the Logistics business in accordance with the related purchase agreement. The companys expectations regarding re-entry into multi-employer pension funds to which it contributes are only its expectations regarding this matter. Whether multi-employer pension funds to which the company contributes approve the companys re-entry into the funds and the timing and terms and conditions of any re-entry is dependent upon approval by the affected funds. Actual contributions to multi-employer pension funds are also affected by levels of employment. The companys expectations regarding the benefits from the new labor contract are only its expectations regarding this matter. The wage, benefit and work rule concessions in the new labor contract may cease if a committee representing the Teamsters (TNFINC) exercises its rights in the new labor contract described below. TNFINC was given the right to approve certain changes of control applicable to the company. If TNFINC approval is not received, TNFINC may declare the wage, benefit and work rule concessions null and void on a prospective basis. In the event of a bankruptcy of the company, TNFINC may declare the wage, benefit and work rule concessions null and void. |
![]() Forward-Looking Statements Forward-Looking Statements 19 The company expects to begin discussions to restructure the debt under its credit agreement, which may include additional capital investment (debt and/or equity) by third parties in a recapitalization. The new labor contract provides the following: o TNFINC would have the right to approve the various transactions comprising the restructuring/recapitalization. o If TNFINCs approval is not obtained, TNFINC may declare the wage, benefit and work rule concessions null and void on a prospective basis, and the company would owe its Teamster employees an amount equal to the concessions that in fact benefited the company prior to the termination. o TNFINC would have significant rights to participate in the restructuring/recapitalization discussions. o In deciding whether to give its approval to a restructuring/recapitalization, TNFINC could demand on behalf of Teamster represented employees of the companys subsidiaries additional compensation if negotiated performance triggers are met, equity participation, specified terms in the restructuring, specified indebtedness levels resulting from the transactions, governance rights and financial viability criteria. o The company is required to enter into definitive agreements to effect the restructuring/recapitalization by December 31, 2010 and close those transactions by March 31, 2011, or in each case, such later date as TNFINC would agree and, in each case, on terms and conditions that TNFINC approves. The companys expectations regarding ratification of a new labor agreement for Reddaway and the timing of any ratification are only its expectations regarding this matter. Ratification of a new labor agreement for Reddaway is dependent on a majority of Reddaway's union employees who are eligible to vote to approve the new labor agreement. The companys expectations regarding its ability to replace the ABS with a new facility are only its expectations regarding this matter. Whether the company is able to replace the ABS and the terms of any replacement facility are dependent upon a number of factors including (among others) the company reaching agreement with interested lenders and closing such transaction on negotiated terms and conditions. The companys expectations regarding multi-employer pension plan reform are only its expectations regarding this matter. The impact to the company and the multi-employer pension plans to which it contributes of such reform is subject to a number of conditions, including (among others) whether Congress passes legislation to reform multi-employer pension plans and the timing of, and provisions included in, such legislation. |
![]() Forward-Looking Statements Forward-Looking Statements 20 The companys expectations regarding the continued support of its stakeholders are only its expectations regarding this matter. Whether the companys stakeholders continue to support the company including (among other things) to continue deferral arrangements in 2011 or to restructure obligations owed to such stakeholders is subject to a number of conditions including (among other things) the outcome of discussions with such stakeholders, whether requested support meets their requirements and the factors identified in the preceding paragraphs. The companys expectations regarding future asset dispositions and sale and financing leasebacks of real estate are only its expectations regarding these matters. Actual dispositions and sale and financing leasebacks will be determined by the availability of capital and willing buyers and counterparties in the market and the outcome of discussions to enter into and close any such transactions on negotiated terms and conditions, including (without limitation) usual and ordinary closing conditions such as favorable title reports or opinions and favorable environmental assessments of specific properties. The companys expectations regarding liquidity, working capital and cash flow are only its expectations regarding these matters. Actual liquidity, working capital and cash flow will depend upon (among other things) the companys operating results, the timing of its receipts and disbursements, the companys access to credit facilities or credit markets, the companys ability to continue to defer interest and fees under the companys credit agreement and ABS facility and interest and principal under the companys contribution deferral agreement, the continuation of the wage, benefit and work rule concessions under the company's modified labor agreement and temporary cessation of pension contributions, and the factors identified in the preceding paragraphs. The companys expectations regarding its capital expenditures are only its expectations regarding this matter. Actual expenditures could differ materially based on a number of factors, including (among others) the factors identified in the preceding paragraphs. The companys expectations regarding its compliance with its credit agreement covenants are only its expectations regarding these matters. Whether the company satisfies the covenants under its credit agreement is subject to a number of factors, including (among others) the factors identified in the preceding paragraphs. The companys expectations regarding its effective tax rate are only its expectations regarding this rate. The actual rate could differ materially based on a number of factors, including (among others) variances in pre-tax earnings on both a consolidated and business unit basis, variance in pre-tax earnings by jurisdiction, impacts on our business from the factors described above, variances in estimates on non-deductible expenses, tax authority audit adjustments, change in tax rates and availability of tax credits. The companys expectations regarding its ability to complete its comprehensive recovery plan are only its expectations regarding these matters. Whether the company is able to complete its comprehensive recovery plan is dependent upon a number of factors including (among others) the company reaching agreement with its stakeholders and interested investors and closing transactions on negotiated terms and conditions, including (without limitation) any closing conditions that the companys stakeholders and investors may require. |
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