Trimac Announces Improved First Quarter Results for 2012

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May 01, 2012, 12:56 ET

Highlights for the first quarter:

Revenue for the quarter improved $7.4 million (10.0%) to $81.0 million
EBITDA for the quarter increased 20.6% to $7.6 million
Acquisition of 29% interest in Northern Resource Trucking Limited Partnership, effective March 19, 2012
Acquisition of 60% interest in Fortress Trucking Limited, effective March 30, 2012
New contract to haul natural gas liquids on behalf of Provident Energy Ltd. in northeastern British Columbia
New five-year contract and business award, effective May 1, 2012, to transport petroleum products for UFA Co-operative Limited
Entered into a joint investment in Bulk Plus Logistics U.S. LLC with our U.S. based sister company Trimac Transportation Inc.

CALGARY, May 1, 2012 /PRNewswire/ - Trimac Transportation Ltd. (TSX Symbol TMA) ("Trimac" or the "Company"), Canada's leader in bulk trucking, is pleased to announce the release of its financial results for the first quarter ended March 31, 2012 ("current quarter").

Trimac's consolidated revenue, including fuel surcharges, for the three-month period ended March 31, 2012 increased by $7.4 million (or 10.0%) as compared to the same period in the prior year ("comparative quarter"). This increase was the result of increased revenue volumes from existing customers, new business awards, rate increases and an increase in fuel surcharge revenue of $3.1 million. Revenue before fuel surcharges improved by 6.4% to close the current quarter at $70.1 million. Increased revenue volumes were attributable to a strong demand for dry bulk commodities from existing customers due to the milder winter weather and new bulk hauling awards attained in petroleum and pressure commodities. Chemical hauling also increased due to the Benson acquisition from June, 2011 which provided $1.1 million of incremental transportation revenue for the current period. Bulk Plus Logistics' revenue increased 13.2% to $4.3 million for the current quarter primarily as a result of increased volumes with existing customers and new business awards in the transload operations. National Tank Services' third party revenue also increased 11.8% to close the quarter at $3.8 million due to higher volumes in the current quarter.

Direct costs net of fuel surcharge revenue (net direct costs) expressed as a percentage of revenue before fuel surcharges, decreased slightly in the current quarter to 72.8% from 73.3% in the comparative quarter. Improved productivity due to warmer winter weather contributed to this decrease. Net direct costs in actual dollar amounts increased $2.7 million over the comparative quarter. This increase was primarily the result of increased driver and leased operator remuneration, maintenance and cleaning costs due to the increased revenue volumes.

Selling and administrative costs as a percentage of revenue before fuel surcharges decreased to 16.4% from 17.1%. In absolute dollars selling and administrative costs increased slightly to $11.5 million from $11.3 million in the comparative quarter. The increase was primarily due to increased revenue volumes, increased salaries due to annual inflation adjustments and increased incentive compensation costs. These increases were partially offset by decreased communication and advertising costs.

EBITDA closed the current quarter at $7.6 million compared to $6.3 million in the comparative quarter, an increase of 20.6%. This increase was primarily the result of the increased revenue volumes, rate increases and improved productivity and strong cost controls.

"We are very pleased with our first quarter results," commented Edward V. Malysa, President and Chief Operating Officer of Trimac. "As we look ahead to the remainder of 2012, we are expecting moderately favourable economic activity levels across the country. Trimac is well positioned to integrate the new business awards and the recent acquisitions into its operations. Trimac will continue to focus on recruiting and retention initiatives."

Financial Highlights


				Three months ended March 31
(in millions of dollars except per share data)				2012	2011	Variance
Consolidated Financial Results

	Revenue before fuel surcharges			70.1	65.9	6.4%

	Operating expenses
		Direct costs		62.0	56.2	10.3%
		Fuel surcharges (1)		(11.0)	(7.9)	-39.2%
				51.0	48.3	5.6%
			Percent of revenue	72.8%	73.3%

		Selling and administration		11.5	11.3	1.8%
			Percent of revenue	16.4%	17.1%

		EBITDA (2)		7.6	6.3	20.6%
		Operating earnings		2.9	2.2	31.8%
		Adjusted net income (2)		1.7	0.8	112.5%


	Segment Results

		Revenue before fuel surcharges
			Bulk Trucking	62.0	58.7	5.6%
			Bulk Plus Logistics	4.3	3.8	13.2%
			National Tank Services	10.1	8.6	17.4%
			Inter-segment revenue	(6.3)	(5.2)
				70.1	65.9	6.4%

		EBITDA
			Bulk Trucking	5.9	4.8
			Bulk Plus Logistics	0.6	0.5
			National Tank Services	1.1	1.0
				7.6	6.3


	Other Information

			Cash generated from operations	5.3	6.0
			Net property, plant and equipment additions	8.9	5.3
			Repurchase of common shares	-	5.5
			Investment in associate	9.2	-
			Acquisitions & investments	8.0	-


	Share Information

			Cash generated from operations per share	0.20	0.23
			Earnings per share - adjusted (2)	0.06	0.03

(1) Management believes it is useful to net fuel surcharge revenue into direct expenses when analyzing operating results. For Trimac, fuel surcharge revenue is considered an expense recovery.
(2) Refer to the management's discussion and analysis for the three months ended March 31, 2012 for the reconciliation of non-GAAP financial measures.

Declaration of Quarterly Dividend

The Board of Directors today declared a dividend of $0.0625 per share on the Class A common shares, payable on July 16, 2012 to shareholders of record at the close of business on June 29, 2012.

Forward-Looking Statements

Certain information included in this news release constitutes "forward-looking statements". Trimac cautions that, by their nature, these forward-looking statements are based on suppositions, risks, and uncertainties as well as on management's best possible evaluation of future events. Trimac cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Such forward-looking statements are not guarantees of future performance and the actual results or performance of Trimac or the transportation industry may be materially different from the outlook or any future results or performance implied by such statements. Please see "Forward-Looking Statements" in Trimac's MD&A for the three months ended March 31, 2012 for a discussion on the material factors that could cause actual results to differ from the forward-looking information contained herein and the material factors and assumptions that were applied in preparing such forward-looking information.

Profile

Trimac is Canada's largest provider of bulk trucking services with operations from coast to coast. In addition, through its National Tank Services division, Trimac performs repairs, maintenance and tank-trailer cleaning services for both the Trimac fleet and for third party commercial customers. Trimac also provides third party transportation logistics services in Canada and the United States through its wholly owned subsidiary Bulk Plus Logistics. Shares of Trimac Transportation Ltd. are traded on the Toronto Stock Exchange under the symbol TMA.

For more detailed information, please visit our website at www.trimac.ca or SEDAR at www.sedar.com and review our MD&A and financial statements for the Company.

You are invited to join us on a conference call (conference ID 3478879) at 10:00 a.m. Eastern Time on Thursday, May 3, 2012. For North American participants, please dial 1- 866-321-8231 or for international participants, please dial ++1-416-642-5213 at least 10 minutes prior to the start time of the call. An audio playback of the call will be available starting Friday, May 4, 2012 on our website at http://www.trimac.ca/page/eventscalendar.

SOURCE Trimac Transportation Ltd.