USF Says 1Q Earnings Will Drop; Yellow Reaffirms Confidence

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SF Corp., which Yellow Roadway Corp. is acquiring, said late Thursday it expects a sharp drop in its first-quarter earnings.

SF said late Thursday it expected its earnings to drop by about half from the previous year. It projected its first-quarter earnings per share to drop to 12 cents to 16 cents a share, from 32 cents a year earlier.

Yellow Roadway, which is in the process of buying USF, reaffirmed its confidence in the acquisition Friday. The two less-than-truckload companies announced the $1.37 billion Feb. 27. (Click here for previous coverage.)

USF cited a slowdown in the automotive sector and Midwest productivity, slower growth in the Northeast in the first quarter and a competitive market in the Southeast.

Yellow Roadway said Friday it remains confident that the acquisition “will provide significant value for shareholders of both companies.”

“Given [USF’s] first-quarter revenue growth and tonnage increase, we believe the business fundamentals remain sound,” said Yellow’s Chairman and Chief Executive Officer Bill Zollars.

Yellow Roadway is No. 3 and USF No. 12 on the Transport Topics 100 listing of North American for-hire carriers.