Shares of shipping company YRC Worldwide Inc (NASDAQ:YRCW) plunged as much as 19% in trading Tuesday after reporting fourth-quarter earnings. At 3:00 p.m. EST, shares were still down 14.7% on the day.
Revenue rose slightly, to $1.15 billion, but the company reported a net loss of $75.3 million, or $0.23 per share, before comprehensive income. Results included a non-union pension settlement charge of $28.7 million, which made the loss larger than it would have been otherwise. Operating income actually swung from a loss of $15.3 million a year ago to a profit of $14.9 million, so there were some signs of improvement.
What hit results was an "other comprehensive loss" of $67.8 million versus a gain of $69.6 million a year ago. The loss didn't overshadow the loss of $7.5 million from regular operations, but it didn't help, either.
YRC Worldwide seems to be at best treading water and at worst, drowning, as shipping prices decline in its end markets. Given the trajectory of earnings, I don't see a lot of reason to be bullish on the stock today.
Until volume or prices pick up, YRC Worldwide will be under a lot of pressure financially. With $980.3 million in long-term debt, I don't think the upside for the stock is worth the risk.