Yellow Corporation · OTC:YELLQ
Yellow — YRC Worldwide — Investor Presentation (May 2018)
40 slides from Yellow's investor presentation, May 21, 2018
Slide 1: Investor Presentation May 2018
Exhibit 99.1 INVESTOR PRESENTATION May 2018
Slide 2: Statements & Disclaimers
STATEMENTS & DISCLAIMERS The information in this presentation is summary in nature and may require us to do so, and we caution you not to rely unduly performance under generally accepted accounting principles. may not contain all information that is important to you. The on them. We have based those
Slide 3: Company overview: one of the largest LTL carriers in North America
From the time we began traveling the roads more than 90 years ago, we have used a combination of extraordinary service, technology and good old fashioned hard work to evolve into the company we are today. One of the largest less-than-truckload (LTL) carriers in North America featuring… ~32,000 ~940M
Slide 4: Our Family of Companies
OUR FAMILY OF COMPANIES Providing services under a portfolio of four operating companies. Collectively, we have approximately 20 - 25% of the public carrier market by tonnage. We provide the broadest coverage and more service capability throughout North America than any competitor. To put it simply,
Slide 5: North America. Delivered.
NORTH AMERICA. DELIVERED. YRC Freight serves manufacturing, wholesale, retail and government customers throughout North America. When customers need longer-haul LTL shipping solutions, YRC Freight is the expert. LTM 1Q18 Revenue $3.1 Billion LTM 1Q18 Adjusted EBITDA $145 Million # of Customers ~ 120
Slide 6: Regional Expertise
REGIONAL EXPERTISE For next-day and time-sensitive services, we have three distinct regional carriers: Reddaway, Holland and New Penn. All three brands are well established in their respective regions. LTM 1Q18 Revenue $1.8 Billion LTM 1Q18 Adjusted EBITDA $130 Million # of Customers ~ 150,000 # of
Slide 7: Our Customers
OUR CUSTOMERS The company you keep says a lot about you. And we work with some very good companies. We’re fortunate to have stable, long-standing relationships with some of the greatest companies in the world, from large Fortune 500 companies to small, privately-held businesses. YRC WORLDWIDE INVEST
Slide 8: We Delivered and Our Customers Noticed
WE DELIVERED AND OUR CUSTOMERS NOTICED Unishippers Global Logistics Management Logistics Management Walmart Logistics Quest for Quality Award Quest for Quality Award 2016 LTL Carrier of 2017 Midwest Regional Winner (30 times) Winner (22 times) the Year LTL Carrier of the Year Unishippers, Avery Worl
Slide 9: Competitive Strengths
COMPETITIVE STRENGTHS YRC Worldwide’s competitive strengths provide a platform for continued improvement and long-term growth. 9
Slide 10: Our People
OUR PEOPLE ~32,000 highly experienced employees throughout North America. ~17,000 drivers safely and efficiently moving freight throughout our network. ~ 14 year average tenure of union employees. Less than 15% union employee turnover. More than 250,000 long-term relationships with customers. More t
Slide 11: Our Dedication
OUR DEDICATION Typical LTL driving distance contributes to stable workforce and low turnover. ~940 million miles covered in 2017 (the equivalent of more than 167,000 round trips between New York and Los Angeles). 1,970 active accident-free 1 million mile drivers 642 active accident-free 2 million mi
Slide 12: Our Networks
OUR NETWORKS YRC Freight Service Center Reddaway Service Center New Penn Service Center Holland Service Center Border Gateways YRC WORLDWIDE INVESTOR PRESENTATION 12
Slide 13: Our Assets
OUR ASSETS YRC Freight operates a modernized national network. Regional carriers operate direct loading and quick sort networks. 384 terminals ~21,000 doors ~14,000 tractors ~45,000 trailers Reinvesting in the business by replenishing the fleet through a combined approach of purchasing and leasing.
Slide 14: Our Technology
OUR TECHNOLOGY Implementing tools for continuous improvement in safety, efficiency, and productivity. In-Cab Safety Technology (in service) 90 Dimensioners (in service) Dock Supervisor Tablets (in service) Quintiq Pickup and Delivery Route Optimization Software (full implementation expected in 2018)
Slide 15: Award-winning customer service with a flexible supply chain
OUR OUR DEDICATION ASSETS OUR OUR OUR PEOPLE NETWORKS TECHNOLOGY The result is award-winning customer service with a flexible supply chain that provides the broadest coverage throughout North America. YRC WORLDWIDE INVESTOR PRESENTATION 15
Slide 16: Update on Recent Events
UPDATE ON RECENT EVENTS 1 2 3 4 CEO Succession 1Q18 Financial Continued YRC Freight Network Plan Completed Results Reinvestment Enhancement Darren Hawkins appointed 1Q18 operating revenue In 1Q18 the Company took Significant structural Chief Executive Officer. increased 3.8% to $1.21 delivery of mor
Slide 17: Financial Update
FINANCIAL UPDATE 17
Slide 18: Consolidated
CONSOLIDATED YRCW Revenue YRCW Operating Income (in millions) (in millions) $5,069 $140 $144 $126 $119 $4,935 $20 $115 $4,865 $4,891 $47 $18 $21 $18 $4,832 $4,748 $70 $4,698 $48 $25 $124 $108 $98 $97 $20 $93 $45 $28 2013 2014 2015 2016 1Q17 2017 1Q18 LTM LTM Pension Expense 2013 2014 2015 2016 1Q17
Slide 19: Simplified Capital Structure
SIMPLIFIED CAPITAL STRUCTURE ($ in millions) $1,361.3M $1,221.0M $918.7M $0.2 5% Convertible Notes $69.4 6% Convertible Senior Notes $69.2 Series B Notes $0.2 5% Convertible Notes $16.5 Series B Notes $177.8 Series A Notes $86.7 Series A Notes $124.2 CDA Notes Contribution Deferral Agreement $124.2
Slide 20: No Near-Term Maturities
NO NEAR-TERM MATURITIES May IBT (MOU) ABL Facility Term Loan 2018 March June July CDA Notes December 3.1 years Focused on Operational Execution Runway 2018 2019 2020 2021 2022 Significant extension of maturities provides runway to continue operational transformation. YRC WORLDWIDE INVESTOR PRESENTAT
Slide 21: Reinvesting in the Business
REINVESTING IN THE BUSINESS After several years of curtailing investment in the business, capital spending has resumed. CapEx Equivalent (in millions) Fleet replenishment through operating leases beginning in $310 2013. $254 $240 $237 Increased leasing activity due to greater financing options $137
Slide 22: Reinvesting in the Business
REINVESTING IN THE BUSINESS 4x increase in technology investment from 2013 to LTM 1Q18. Recent Technology & Other CapEx investments include: Technology + Other Dimensioners (a) Mobileye and Lytx in-cab safety technology (a) CapEx Spend Pickup and delivery handheld units (in millions) Upgraded forkli
Slide 23: Opportunity for Operating Ratio Improvement
OPPORTUNITY FOR OPERATING RATIO IMPROVEMENT LTM 1Q18 OPERATING RATIO 98.0% Improvement Opportunity 96.7% 1.0% 1.7% Operating Ratio Goals 97.0% 95.0% 90.4% Industry ex YRCW YRC Regional YRC Freight Note: The peer group’s LTM 1Q18 Operating Ratio includes ODFL, SAIA LTL, ABFS, FDXF and XPO LTL. LTM 1Q
Slide 24: Plan to Achieve Operating Ratio Goals
PLAN TO ACHIEVE OPERATING RATIO GOALS 1 4 Safety Culture Enhancing Employee Engagement In-cab safety technology Union employees profit sharing bonus opportunity based on achieving OR metrics New investment in employee injury avoidance is being implemented in 2018 2 5 Volume and Yield Growth Improvin
Slide 25: Forward Looking Considerations
FORWARD LOOKING CONSIDERATIONS 1 2 3 4 Plan to continue International No material long- Total federal net investing back into Brotherhood term debt / facility operating losses the business through of Teamsters maturities until 2Q21. (NOLs) of $805.4 combined memorandum of Operational runway for mill
Slide 26: How we plan to move freight, our company, and your investment
How we plan to move freight, our company, and your investment. YRC Worldwide provides the opportunity to invest in a portfolio of four proud and distinct LTL operating companies. Experienced Strong Tremendous Simplified & Diversified Reinvestment Well Positioned In Leadership Industry Asset Stable C
Slide 27: Investor Relations
INVESTOR RELATIONS YRCW yrcw.com Tony Carreño Vice President – Investor Relations (913) 696-6108 tony.carreno@yrcw.com YRC WORLDWIDE INVESTOR PRESENTATION 27
Slide 28: Appendix
DD a YRC Worldwide
Slide 29: Experienced Senior Management
EXPERIENCED SENIOR MANAGEMENT Darren Hawkins Stephanie Fisher Justin Hall Jim Fry Chief Executive Officer, Chief Financial Officer, Chief Customer Officer, Vice President, General YRCW YRCW YRCW Counsel & Corporate Secretary, YRCW More than 28 years of More than 17 years of Responsible for designing
Slide 30: Experienced Senior Management
EXPERIENCED SENIOR MANAGEMENT Scott Ware Howard Moshier Bob Stone TJ O’Connor President, Holland President, New Penn President, Reddaway President, YRC Freight More than 31 years of More than 30 years of More than 33 years of More than 35 years of industry experience. industry experience. industry e
Slide 31: YRC Freight's Network Enhancement
YRC FREIGHT’S NETWORK ENHANCEMENT Seattle Portland St. Paul Buffalo Maybrook Chicago Harrisburg South Bend Akron Hagerstown Salt Lake City Omaha Columbus Tracy Indianapolis Denver Kansas City Richmond Nashville St. Louis Charlotte Bloomington Memphis Oklahoma City Atlanta Phoenix Dallas Jackson 8 Ne
Slide 32: Multi-Employer Pension Plans
MULTI-EMPLOYER PENSION PLANS Employees covered by collective bargaining agreements. Cash Contributions to Multi- Required contractual contributions anticipated to be an average of $2.22 per hour in 2018 (a) . Employer Pension Plans (in millions) 2018 cash contributions to be approximately $105 milli
Slide 33: Single-Employer Pension Plans
SINGLE-EMPLOYER PENSION PLANS Certain employees not covered by collective bargaining agreements. Cash Contributions to Single- Plans closed to new participants effective January 1, 2004 Employer Pension Plans with benefit accrual for active employees frozen effective (in millions) July 1, 2008. (b)
Slide 34: Leverage Ratio
LEVERAGE RATIO YRCW Adjusted EBITDA Funded Debt / Adjusted (in millions) EBITDA 5.34x $333 $298 4.57x $278 $274 $277 $255 $245 3.62x 3.25x 3.40x 3.38x 3.32x 2013 2014 2015 2016 1Q17 2017 1Q18 2013 2014 2015 2016 1Q17 2017 1Q18 LTM LTM LTM LTM Note: Funded debt balances based on par value Growing int
Slide 35: Credit Facility Covenants
CREDIT FACILITY COVENANTS Four Consecutive Fiscal Quarters Ending 3.32x 3.50 3.50 3.50 3.50 LTM as 3.25 3.25 3.25 of 1Q 3.00 3.00 3.00 2018 2.75 2.75 2.75 2.50 YRCW’s credit ratings as of March 31, 2018: Standard & Poor’s Corporate Family Rating was B- with Stable outlook Moody’s Investor Service Co
Slide 36: Cash Flow
CASH FLOW YRCW Operating Cash Flow (b) YRCW Free Cash Flow (a) (b) (in millions) (in millions) $57 $148 $38 $26 $104 $91 $81 $61 $33 $(15) $(20) $14 $(34) $(44) 2013 2014 2015 2016 LTM 2017 LTM 2013 2014 2015 2016 LTM 2017 LTM 1Q17 1Q18 1Q17 1Q18 Focused on improving cash flows while simultaneously
Slide 37: Key Segment Information
KEY SEGMENT INFORMATION YRC Freight Regional Transportation 1Q18 1Q17 YoY % (a) 1Q18 1Q17 YoY % (a) Workdays 63.5 64.0 63.5 64.0 Total tonnage (in thousands) 1,499 1,547 (3.1) 1,914 1,925 (0.6) Total tonnage per day (in thousands) 23.60 24.18 (2.4) 30.14 30.07 0.2 Total shipments (in thousands) 2,45
Slide 38: EBITDA Reconciliation (Consolidated)
EBITDA RECONCILIATION (CONSOLIDATED) ($ in millions) YRCW Consolidated FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 1Q 2017 1Q 2018 LTM 1Q 2017 LTM 1Q 2018 Reconciliation of net income (loss) to adjusted EBITDA (a) Net income (loss) $ (83.6) $ (67.7) $ 0.7 $ 21.5 $ (10.8) $ (25.3) $ (14.6) $ 8.2 $ (0.1)
Slide 39: EBITDA Reconciliation (Segment)
EBITDA RECONCILIATION (SEGMENT) ($ in millions) YRC Freight Segment FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 1Q 2017 1Q 2018 LTM 1Q 2017 LTM 1Q 2018 Reconciliation of operating income (loss) to adjusted EBITDA (a) Operating income (loss) (c) $ (12.6) $ 23.2 $ 63.3 $ 71.8 $ 60.8 $ (7.5) $ (6.9) $ 55.5
Slide 40: Free Cash Flow Reconciliation
FREE CASH FLOW RECONCILIATION ($ in millions) YRCW Consolidated FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 LTM 1Q 2017LTM 1Q 2018 1Q 2017 1Q 2018 (a) Net Cash (used) / provided in operating activities$ 13.5 $ 33.3 $ 147.6 $ 103.8 $ 60.7 $ 90.7 $ 80.6 $ (23.6) $ (3.7) Acquisition of property and equipme