Yellow Corp. trips over first quarter losses as it restructures

Yellow Corp. reported a net loss of $54.6 million in its 2023 first quarter. Soft demand and costs associated with the first phase of its One Yellow restructuring were blamed for the loss.

First quarter 2023 operating revenue was $1.159 billion and operating loss was $9.3 million, according to a company earnings report.

In the first quarter of 2022, operating revenue was $1.26 billion and operating income was $9.2 million, which included a $5.5 million net gain on property disposals.

“The soft demand environment during the first quarter was similar to the slowing pace we experienced late last year,” Darren Hawkins, Yellow CEO, said in a company statement. “The daily shipment count remained steady from January through March without the typical seasonal uplift in demand in the second half of the quarter.”

Hawkins said first-quarter results were affected by some remaining costs associated with the execution of Phase One of the company’s network optimization and transition to a super regional carrier and also some preparation costs for Phase Two.

“Phase One consisted of approximately 20% of the network and was successfully implemented in the western United States in 2022. Customers are seeing the benefits of Phase One with an improvement in the percentage of shipments going out for delivery before 9 a.m. and a reduction in missed pick-ups,” Hawkins said in the earnings statement. “Phase Two will consist of legacy YRC Freight, Holland and New Penn terminals in the Midwest, Northeast and Southeast, and covers approximately 70% of the network. We plan to provide an update on Phase Two once an implementation date has been determined.

“It is imperative that we complete our One Yellow strategy, which will strengthen the company, protect 22,000 union jobs and ensure that our customers are well cared for and receive the range of services that today’s market demands.”

One Yellow is a consolidation strategy announced in 2021. The changes have caused friction with the Teamsters union.

Less-than-truckload

Yellow’s less-than-truckload business showed an increase per hundredweight shipped but tonnage per workday slipped compared to the first quarter of 2022.

First quarter 2023 less-than-truckload revenue per hundredweight, including fuel surcharge, increased 4.4%. LTL revenue per shipment increased 6% compared to the same period in 2022. Excluding fuel surcharge, first quarter LTL revenue per hundredweight increased 2.8% and LTL revenue per shipment increased 4.4%.
First quarter 2023 LTL tonnage per workday decreased 12.9% when compared to first quarter 2022.

The number of LTL shipments slipped 13.6% from 5.75 million in first quarter 2022 to 4.97 million in first quarter 2023.

Yellow Corp., formerly based in Overland Park, Kan., and has moved its corporate offices to Nashville, Tenn. The company was founded in 1924 as Yellow Cab Transit Co. In 2009, Yellow merged with Roadway Express under the YRC Inc. banner. In early 2021, YRC Worldwide became Yellow Corp. LL

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