Lenders lift covenant for YRC

Lenders lift covenant for YRC

Zollars

   YRC Worldwide Inc. said Friday it has finalized an amendment with lenders that eliminates a second quarter earnings before interest, taxes, depreciation and amortization (EBITDA) covenant on its credit facilities.
   The company’s other financial covenants, including minimum liquidity comprised of cash and cash equivalents, restricted cash and availability under the credit facilities, remain in effect.
   The announcement followed a report in the Wall Street Journal that the trucking company plans to ask for $1 billion in federal bailout assistance for pension obligations. The newspaper cited Bill Zollars, chairman and chief executive officer, as saying money from the Troubled Asset Relief Program would help YRC with about $2 billion in pension obligations during the next four years.
   “It is still too early in the second quarter to precisely project our earnings results,' Zollars said. 'Although volumes that were temporarily diverted have begun to return, it has not been at the level and speed that we initially expected, and as a result, we proactively worked through an amendment with our banks to remove any EBITDA targets in the second quarter. Our operational trends continue to improve and the loyalty of our customers remains strong, which gives us confidence in our earnings trends as we progress through the year.”