USFREIGHTWAYS INCOME FALLS; MAY SELL FORWARDING UNIT
USFreightways Corp. said Friday said its second-quarter net income fell 48 percent to $5.9 million, due to an impairment charge from its freight forwarding unit, USF Worldwide Inc.
Samuel K. Skinner, chairman, president and chief executive officer of USFreightways, said the company is considering selling the weak-performing USF Worldwide.
'We have concluded that the freight forwarding business, as currently structured, does not fit as one of our core businesses,' Skinner said. The company has retained Morgan Stanley to advise it of alternatives for USF Worldwide, 'including the sale of the company. We hope that this process will be completed by the end of the third quarter.'
USF Worldwide reported pre-tax charges of $7.8 million, or $4.5 million after tax, related to long-lived assets impairment. The unit had an operating loss of $9.1 million, following an operating loss of $4.7 million for the year-earlier quarter. Revenue was $55.5 million, down from $66.1 million in the year-earlier period.
Excluding the charge, USFreightways net income would be $10.5 million. Operating income fell to $14.1 million, from $24.3 million, on revenue of $626.7 million, up slightly from $623.9 million in the second quarter of 2001.
USFreightways' less-than-truckload unit saw operating income of $28.5 million, down slightly from $28.7 million. Revenue improved to $475.2 million from $465.3 million.
The truckload unit nearly doubled its operating income, to $1.5 million, on revenue of $28.5 million, up from 25.6 million for the year-earlier period.