Ryder takes $50 million 3Q charge

Sept. 24, 2001
Miami-based Ryder System Inc., a provider of supply chain and transportation management services, said it will take a $50- to $54-million charge against its third quarter 2001 net income to cover a continuing restructuring of its business. Despite that charge, Ryder said it should still meet or exceed previous after-tax per share earning estimates of $0.47 to $0.49 per share. The four primary reasons
Miami-based Ryder System Inc., a provider of supply chain and transportation management services, said it will take a $50- to $54-million charge against its third quarter 2001 net income to cover a continuing restructuring of its business. Despite that charge, Ryder said it should still meet or exceed previous after-tax per share earning estimates of $0.47 to $0.49 per share.

The four primary reasons for the charge include: the cancellation of an information technology project for Ryder’s Fleet Management Solutions unit ($22 million); the write-off of software licenses ($5 million); the pending shutdown of Systemcare, Ryder’s shared-user home delivery network in the United Kingdom ($16 million); and a continuation of previously announced headcount reductions and facility closures ($7 million to $11 million).

Gregory T. Swienton, Ryder’s president & CEO, said that – as expected – the company’s revenue was lower than last year’s first two months during the third quarter, but was off more than previously anticipated due to continued sluggishness in the global economy. He added that Ryder’s “aggressive cost-cutting and strategic initiatives” have generated better than expected results, significantly reducing the company’s cost structure.

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