Dahlman Rose Comments On YRC Worldwide Following Recent Earnings Release

YRC Worldwide YRCW reported 1Q11 adjusted EBITDA loss of $3.4 MM. This result is based on the unconventional calculation defined by the company's EBITDA covenant. EBITDA as we calculate it was a loss of $18.7 MM. However, excluding unusual items, EBITDA was a gain of $6.3 MM vs Dahlman Rose's estimate of a loss of $1.4 MM and consensus estimate of a gain of $5.1 MM. The loss/sh from continuing operations was $1.62/sh vs Dahlman's and consensus estimates for losses of $1.93/sh and $1.53/sh. To reflect the reported 1Q11 results, Dahlman tweaks its 2011 EBITDA estimate to $204.2 MM, from $197 MM, while 2012 EBITDA estimate of $319.4 MM remains intact. While the company continues to sift through major issues including striving for profitability, maintaining liquidity, the upcoming management changes, and the likelihood of further share dilution, the recent restructuring agreement has likely bought the company some more time to get its house in order while the LTL recovery is still ongoing. Dahlman Rose continues to shun the shares due to the continued issues. It maintains a Hold rating on YRCW YRCW closed Friday at $1.31