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Pacer Posts Weak Second Quarter

August 06, 2009

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Pacer posted losses and decreased revenue for the second quarter of 2009, on the heels of announcing it will sell its heavy-haul trucking operations to Universal Truckload Services and UTS Leasing.


The company reported its second quarter results, with a net loss of $7.3 million, compared with net income of $13.4 million in the 2008 quarter. Revenues dropped to $376.7 million from $516.6 million for the year-ago quarter.

Within the company's intermodal division, volumes showed improvement from the first quarter, but the unit saw a loss of $5.7 million, compared to operating income of $31.6 million in the second quarter of 2008.

The logistics segment managed to narrow the loss to $1.4 million, compared to a loss of $1.7 million in the year-ago period.

"While demand and economic conditions in general remained very difficult leading to a second quarter loss, there were some positive signs that our business levels were stabilizing and even improving in some key areas during the quarter," said Brian Kane, CFO of Pacer. "We continue to take the steps necessary to reduce our costs to benchmark competitive levels and provide the financial resources needed to position Pacer for future growth."

The company amended its credit agreement during the quarter, waiving compliance with the leverage ratio covenant through August 31.

"Additional organizational simplification and workforce reduction initiatives were implemented during the quarter moving Pacer significantly closer to the organizational integration, process improvement, and cost reduction goals we have established," said Michael Uremovich, chairman and CEO.

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