Slide 1: Yellow Roadway Corporation: A Bold Strategic Combination
Exhibit 99.1 (LOGO) YELLOW CORPORATION (LOGO) ROADWAY CORPORATION Yellow Roadway Corporation A Bold Strategic Combination Building for the Future September 3-5, 2003 Making global commerce work by connecting people, places, and information. 1
Slide 2: First, an update on Yellow performance
(LOGO) YELLOW CORPORATION First, an update on Yellow performance Yield and Tonnage Balance Operating Income Growth [CHART] [CHART] 2
Slide 3: Roadway Transaction – The Right Strategy, the Right Partner
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Roadway Transaction – The Right Strategy, the Right Partner n Advances strategy n One-stop shopping • Greater penetration of premium services • Non-asset solutions to larger base of customers • Next-day opportunities • Technology solutions for cus
Slide 4: The Right Strategy, the Right Partner
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation The Right Strategy, the Right Partner n Enhanced Scale and Market Position n Combined revenue of approximately $6 billion • Nearly 48,000 employees in over 700 locations n Largest North American transportation company focused on shipments over 150
Slide 5: The Right Time
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation The Right Time n Both companies are solidly profitable n Roadway management team supportive of strategy n 5-year labor agreement n Favorable financial markets n Potential of economic recovery n Substantial operating leverage n Incremental margins
Slide 6: Mitigating the risks
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Mitigating the risks n Customer retention n Don’t provide reasons for customers to change • Do what we said we would do • Maintain high levels of service and quality • Key customer interfaces remain in place n Provide enhancements to customer expe
Slide 7: Mitigating the risks
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Mitigating the risks n Employee Retention / Union Relations n Goal is to grow from a larger, stronger competitive position n Retaining key employees is a top priority • James Staley, President & CEO of Roadway, will remain in his position at Roadw
Slide 8: Near-term synergies
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Near-term synergies n Accretive with only $30 million of cost synergies n Represents less than 0.5% of operating expenses n Run rate cost synergies of between $45 million and $125 million twelve months after closing n Examples of conservative case
Slide 9: Longer-term potential synergies
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Longer-term potential synergies n Target is at least 5% of costs ($300+ million) n Examples of longer-term synergies: n Optimization of linehaul networks and terminal efficiency n Moving toward common technology systems n Common equipment maintena
Slide 10: Pro forma leverage
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Pro forma leverage Debt to EBITDA Debt to Capital [BAR CHART] [BAR CHART] n Both companies will continue to reduce debt n Free cash flow generation allows for rapid debt reduction n NOPAT return on capital above cost of capital within 12 months of
Slide 11: Anticipated capital structure at closing
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Anticipated capital structure at closing n Debt structure provides flexibility at attractive terms (millions) n ABS borrowings $ 103 n Term loan 175 n Convertible notes 250 n New senior unsecured notes 150 n Roadway senior unsecured notes 252(1) n
Slide 12: Timeline update
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Timeline update n Department of Justice review n Second request received on August 18 n Currently providing responses n SEC process n Preliminary proxy filed on August 19 n Announcement of record date pending n Shareholder vote likely in fourth qu
Slide 13: Transaction terms and structure
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Transaction terms and structure Transaction value n $48 per share n Equity value: $961 million n Total enterprise value: $1.2 billion n Adjusted total enterprise value: $1.5 billion(1) Consideration n 50% cash and 50% Yellow stock n Roadway shareh
Slide 14: Transaction terms and structure (cont'd)
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Transaction terms and structure (cont’d) Value per Roadway share assuming 50% stock / 50% cash consideration [CHART] 14
Slide 15: Summary
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Summary n Summary of transaction benefits n Consistent with strategy – ‘one-stop shopping’ n Strong brand equity preserved n Increased scale of operations and stronger market share n Low risk integration strategy n Non-asset opportunities with eve
Slide 16: Forward-looking statements
(LOGO) YELLOW CORPORATION (LOGO) Roadway Corporation Forward-looking statements n This presentation (and oral statements made regarding the subjects of this presentation, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E