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YRC Worldwide Inc. Message Board

  • guy1976cr guy1976cr Jan 5, 2008 10:56 AM Flag

    YRCW is in deep trouble guys

     

    Balance sheet is very weak for the business cycle we just entered.

    Lower shipping demand and high oil prices will kill any margin. YRCW is also on hook for $4.5bil (off balance sheet) pension liability. I don't know how they'll fund this.

    The biggest problem is that Cash balance is now sitting at $200mil.In the past quarters (profitable quarters) YRCW was cashflow negative due to high capex. Now where operations won't be contributing that much money to the bottom line, YRCW's cash balance will quickly go down.
    Short term debt of $460 mil needs to: either be paid down (where is the money) or refinanced. YRCW was just cut to junk status and we all know that junk bonds are having too much trouble of being sold to public. No bank will want to keep this on the balance sheet as we go into recession.

    Best bet for YRCW is to sell a division, pay down the short term debt, boost cash and expand in Asia, but doubt that will happen.

    I can see YRCW going down to single digits before they need money. At around $9, they'll announce convertible bond offering and that will kill the stock for a long time.

    This topic is deleted.
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YRCW
21.18-0.66(-3.02%)Sep 19 4:00 PMEDT

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