CNF POSTS 4TH-QUARTER LOSS
CNF Inc., based in Palo Alto, Calif., on Tuesday reported net losses of $217.1 million for the fourth quarter and $402.9 million for 2001.
The fourth-quarter loss included $223.2 million in non-recurring unusual items, while the full-year results included $660.6 million in non-recurring unusual charges. The charges primarily included restructuring at Emery Worldwide, including ceasing the operations of its airline subsidiary, and losses due to the failure of a company under contract with Menlo Logistics.
Excluding the charges, the fourth-quarter net income would have been $5.9 million, while the full year net result would have been $34.2 million.
CNF reported an operating loss of $337.0 million for the fourth quarter, compared to operating income of $76.4 million in 2000. Revenue was $1.14 billion, down 20.6 percent.
For the year, the company saw an operating loss of $660.6 million, compared to operating profit of 290.0 million in 2000. Revenue was $4.86 billion for the year, down 12.7 percent.
“With the economy in recession for the entire year, and the loss of postal revenues, sales fell to a level we haven’t seen since 1998,” said Gregory L. Quesnel, president and chief executive officer of CNF Inc.
Beginning in the first quarter of 2002, CNF's results will be reported with three primary lines of business: Con-Way Transportation Services, Menlo Worldwide and Other.
On Dec. 5, CNF announced the formation of Menlo Worldwide, “that combines the strengths of Emery Worldwide, Menlo Logistics, and Vector SCM” to provide “supply chain services on a global basis,” Quesnel said.
Con-Way's fourth quarter operating income was $35.7 million, down 33 percent, on revenue of $463 million, down 6 percent. Regional carrier tonnage per day declined 4 percent and less-than-truckload tonnage per day was off 3 percent. For the year, operating income was $157.5 million, down 31 percent, on revenue of $1.9 billion, down 6 percent.
The Con-Way division's first quarter of 2002 “is expected to be flat to slightly down from last year’s first quarter,” Quesnel said,” with yields expected to be down in the middle-single-digit range.”
Emery Worldwide reported a fourth-quarter operating loss of $366.4 million, compared with operating income of $14.5 million in the period a year ago. Revenue was $460 million, down 36 percent from $723.8 million for the fourth quarter of 2000. For the year, Emery saw an operating loss of $790.3 million, compared with operating income of $28.4 million in 2000. Revenue was $2.0 billion, down 22 percent.
Menlo Logistics saw a fourth-quarter operating loss of $2.7 million, compared with operating income of $8.6 million in the prior-year period, and revenues of $219.4 million, up 1 percent from $216.7 million for the fourth quarter of 2000.
Vector SCM, Road Systems and corporate activities reported an operating loss of $3.6 million in the fourth quarter.
Internationally, “Emery’s volumes are currently 20 percent below last year’s,” International gross margin is expected to be flat or improve slightly. At Menlo Worldwide Logistics unit, revenue and operating income are expected to decline slightly” in the first quarter of 2002, Quesnel predicted.