YRC posts bigger loss on charges, freight drops

CHICAGO (Reuters) - No. 1 U.S. trucking company YRC Worldwide Inc (YRCW.O) on Thursday reported a worse-than-expected quarterly loss due to the impact of recession on freight and a series of charges, sending its shares down more than 3 percent in after-hours trading.

The Overland Park, Kansas-based company reported a first-quarter loss of $257.4 million or $4.34 per share, compared with $46.4 million or 82 cents per share a year earlier.

Excluding charges, YRC said its loss amounted to $2.63 per share.

Analysts had on average expected a loss for the quarter of $1.77 per share, according to Reuters Estimates.

The company said revenue in the quarter fell to $1.50 billion from $2.23 billion a year earlier. Tonnage at the company's national trucking unit was down 29 percent.

Chief Executive Bill Zollars told Reuters after the results came out that about a third of the drop in revenue was due to "nervous customers" diverting freight during the quarter because of uncertainty over the struggling truck company's future.

"Almost without exception that business is on its way back or will be shortly," Zollars said.

He added that hopeful statements from across corporate America that the worst of the recession may have passed seemed reasonable.

"There is a danger there that -- as we've seen several times already when people have said we've reached the bottom -- the economy will take another step down in two weeks' time," Zollars said. "But it looks like thing are not getting any worse."

Excluding fuel surcharges, Zollars said that YRC's prices were up about 1 percent in the first quarter. Transportation companies like YRC levy fuel surcharges to cover rising fuel costs. Fuel prices have come down since oil hit a high of around $147 last July and surcharges have come down as well.

Last week YRC received approval from its banking group to offer real estate as collateral to secure deferred pension fund payments, which Zollars put at around $40 million a month. The company had said at an analyst meeting earlier this month that it expected to report charges of up to $185 million for the first quarter.

In February, the struggling company's creditors approved an amendment to its $950 million senior revolving credit facility.

YRC has shed jobs, shuttered facilities and restructured its trucking network to try to turn its business around amid the U.S. recession. In January, its unionized workers agreed to a 10 percent pay cut in return for a 15 percent stake in the company.

CEO Zollars said the company is still confident of realizing up to $500 million in property sale and sale/leaseback deals this year. He added that a growing number of bidders interested in the properties up for sale.

In after-hours trade YRC shares were down more than 3 percent at $3.43 from their official Thursday closing price of $3.55 on Nasdaq.

(Reporting by Nick Carey; Editing by Phil Berlowitz, Leslie Gevirtz)