UPDATE 4-US trucker YRC reports deep loss, shares tumble

* Q3 loss $1.33/share vs Street view loss $1.31

* Revenue $1.14 billion, in line with expectations

* Shares down 12 pct at midday
(Adds fresh analyst comment, updates share price)

By Carey Gillam

OVERLAND PARK, Kan., Nov 5 (BestGrowthStock) – YRC Worldwide (YRCW.O: )
posted a deep quarterly loss on Friday and its shares dropped 12
percent, but the troubled U.S. trucker said its business was
stabilizing and regaining momentum.

Shipments per day were up for its regional transportation
businesses, both year-over-year and compared with the previous
quarter. But shipments per day for its national business slid 12.2
percent from a year earlier.

Chairman Bill Zollars said that with strong customer and employee
support, the No. 1 less-than-truckload (LTL) carrier was making
“significant progress” on its recovery plan.

“There is good momentum here in the right direction,” said
Zollars.

The company said it expected continued improvement and would have
positive adjusted earnings before interest, taxes, depreciation, and
amortization expenses (EBITDA) in excess of lender requirements in
the fourth quarter.

But analysts remained skeptical about the company’s long-term
prospects.

“Though industry volumes have firmed and YRC Regional’s volume
growth has resumed, the company continues to lose market share on an
overall basis,” said Robert W. Baird & Co analyst Jon Langenfeld in a
note to investors.

Deutsche Bank Equity Research analyst Justin Yagerman said the
threat of “significant dilution” was a problem for YRC investors.

YRC shares were off 57 cents at $4.19 in early afternoon
trading.

YRC said it lost $62 million, or $1.33 per share, in the third
quarter. Analysts expected a loss of $1.31 a share, according to
Thomson Reuters I/B/E/S.

Its year-earlier loss was $159 million, or $66.66 per share.
Average outstanding diluted shares jumped to 46.5 million from 2.4
million a year earlier, reflecting a debt-for-equity swap and a
reverse stock split.

Operating revenue was $1.14 billion, in line with analysts’
expectations. The company said it generated positive cash flow from
operating activities of $5 million in the quarter.

YRC has been struggling to stay out of bankruptcy under a
crushing debt load and stiff competition. Late last month it said it
had achieved $350 million in labor concessions with the International
Brotherhood of Teamsters to help keep it afloat.

YRC has also been selling assets and paring costs through
layoffs, and working to reduce the debt levels that nearly pushed it
into bankruptcy last year. So far this year it has reduced debt by
$73 million, it said.

The company said on Friday it plans further consolidation of
facilities in 2011.

“We continue to effectively manage our working capital, reduce
debt and improve our cash flow, as demonstrated by the significant
sequential improvement in our cash flow from operating activities
from second quarter to third quarter,” YRC CFO Sheila Taylor said in
a statement.

YRC officials defended the company against a lawsuit brought last
week by a unit of competitor Arkansas Best (ABFS.O: ), and said YRC may
file a countersuit.

The Arkansas Best suit asks for $750 million in damages and seeks
to nullify the Teamsters union labor concessions to YRC. The suit
alleges the deal between YRC and the union violates a national
industry collective bargaining agreement.

YRC officials said on Friday its rival’s claims were meritless.

“We would expect to win the day,” said Zollars. “We think the
suit is completely without merit.”
(Reporting by Carey Gillam; editing by Dave Zimmerman and John
Wallace)

UPDATE 4-US trucker YRC reports deep loss, shares tumble