Trimac Announces Solid 2011 Second Quarter Results
- Revenue improved $8.5 million (11.6%) to $82.0 million
- Revenue excluding fuel surcharges increased 6.4% to $71.8 million
- Trimac acquires the rolling stock of Benson Tank Lines on June 8, 2011
- Increased volumes in most commodities
- Trimac receives awards from key customers and an industry association
CALGARY, Aug. 3, 2011 /PRNewswire/ - Trimac Transportation Ltd. (TSX: TMA) ("Trimac" or the "Company"), Canada's leader in bulk trucking, is pleased to announce the release of the financial results for the second quarter ended June 30, 2011 ("current quarter").
Trimac's consolidated revenue, including fuel surcharges, for the three-month period ended June 30, 2011 increased by $8.5 million (11.6%) as compared to the same period in the prior year ("prior quarter"). This increase was the result of increased revenue in most of the commodities hauled from new and existing customers and an increase in fuel surcharge revenue of $4.2 million. Lower revenue from cement, petroleum and edible products due to the wet spring in Alberta and Saskatchewan and lower construction starts in Eastern Canada offset otherwise strong revenue gains on a year over year comparison. Revenue excluding fuel surcharges improved by 6.4% to close the current quarter at $71.8 million. For the six-month period ended June 30, 2011 ("current year") total revenue increased 11.5% to $155.0 million as compared to the $139.0 million reported in the prior six-month period ("prior year"). The Benson purchase late in the second quarter contributed $0.3 million in incremental revenue.
Direct costs net of fuel surcharge revenue expressed as a percent of revenue, increased in the current quarter to 73.0% of revenue compared to 72.0% for the prior quarter. This was primarily as a result of increased fuel costs (net of fuel surcharge recovery), new business start up costs, unseasonably wet weather, increased maintenance costs and decreased productivity due to new drivers that are still completing the Company's comprehensive training and safety programs. For the current year, direct costs remained relatively flat at 73.1% as compared to 72.8% in the prior year.
Mostly as a result of the increased direct costs, EBITDA closed the quarter at $8.0 million compared to $8.4 million in the prior quarter and adjusted net income was $2.0 million compared to $2.8 million in the prior quarter.
In commenting on the results for the quarter, Edward V. Malysa, President & Chief Operating Officer of Trimac, said "The second quarter has been a challenging one with the wet weather hampering our results, however, due to our dedicated professional drivers and support team of mechanics, technicians and administrative staff we are well positioned for the anticipated catch-up in revenue for delayed construction projects in the third quarter. The investment in new equipment together with an increased workforce should provide improved results in the last half of the year."
Awards
During the second quarter, Trimac received the 2010 "Outstanding Performance" award from A&R Logistics for our safety performance in the highest mileage category. Imperial Oil also recognized Trimac with the "Nobody Gets Hurt" trophy and the "President's Award" for our safety performance with no personal injuries during 2010. A third award was granted by the Canadian Petroleum Products Institute for product handling and product stewardship successes. In commenting on these accomplishments, Jeffrey J. McCaig, Chairman and CEO said, "Safety has been Trimac's core value for over 65 years. Trimac's first priority is to ensure that we provide the safest possible environment for all of our dedicated employees. In short, Trimac strives to be the safest transportation company in Canada and recognition from our customers and industry associations ensures that we are achieving our goals."
Financial Highlights
| Three months ended June 30 | Six months ended June 30 | ||||||||||||||
| (unaudited, in millions of dollars except per share data) | 2011 | 2010 | Variance | 2011 | 2010 | Variance | |||||||||
| Consolidated Financial Results | |||||||||||||||
| Transportation revenue | 71.8 | 67.5 | 6.4% | 136.9 | 127.6 | 7.3% | |||||||||
| Operating expenses | |||||||||||||||
| Direct costs | 62.6 | 54.6 | 14.7% | 118.1 | 104.3 | 13.2% | |||||||||
| Fuel surcharges (1) | (10.2) | (6.0) | -70.0% | (18.0) | (11.4) | -57.9% | |||||||||
| 52.4 | 48.6 | 7.8% | 100.1 | 92.9 | 7.8% | ||||||||||
| Percent of revenue | 73.0% | 72.0% | 73.1% | 72.8% | |||||||||||
| Selling and administration | 11.4 | 10.5 | 8.6% | 22.6 | 20.3 | 11.3% | |||||||||
| EBITDA (2) | 8.0 | 8.4 | -4.8% | 14.2 | 14.4 | -1.4% | |||||||||
| Percent of revenue | 11.1% | 12.4% | 10.4% | 11.3% | |||||||||||
| Operating earnings | 3.6 | 4.2 | -14.3% | 5.8 | 5.9 | -1.7% | |||||||||
| Adjusted net income (2) | 2.0 | 2.8 | -28.6% | 2.8 | 3.7 | -24.3% | |||||||||
| Segment Results | |||||||||||||||
| Revenue before fuel surcharges | |||||||||||||||
| Bulk Trucking | 63.9 | 60.8 | 5.1% | 122.6 | 114.9 | 6.7% | |||||||||
| Bulk Plus Logistics | 5.2 | 4.1 | 26.8% | 8.9 | 7.2 | 23.6% | |||||||||
| National Tank Services | 8.8 | 8.8 | 0.0% | 17.4 | 17.3 | 0.6% | |||||||||
| Inter-segment revenue | (6.1) | (6.2) | (12.0) | (11.8) | |||||||||||
| 71.8 | 67.5 | 6.4% | 136.9 | 127.6 | 7.3% | ||||||||||
| EBITDA | |||||||||||||||
| Bulk Trucking | 6.1 | 6.8 | 10.8 | 11.8 | |||||||||||
| Bulk Plus Logistics | 0.6 | 1.0 | 1.1 | 1.5 | |||||||||||
| National Tank Services | 1.3 | 0.6 | 2.3 | 1.1 | |||||||||||
| 8.0 | 8.4 | 14.2 | 14.4 | ||||||||||||
| Other Information | |||||||||||||||
| Cash generated from operations | 7.8 | 8.2 | 13.8 | 14.1 | |||||||||||
| Net property, plant and equipment additions | 9.4 | 6.0 | 14.6 | 7.4 | |||||||||||
| Repurchase of common shares | - | - | 5.5 | - | |||||||||||
| Acquisitions | 4.0 | - | 4.0 | 3.3 | |||||||||||
| Share Information | |||||||||||||||
| Cash generated from operations per share | 0.30 | 0.31 | 0.54 | 0.54 | |||||||||||
| Earnings per share - adjusted (2) | 0.08 | 0.11 | 0.11 | 0.14 | |||||||||||
| (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 second quarter management's discussion and analysis for the reconciliation of non-GAAP financial measures. | |||||||||||||||
Financial Statements
At the time of issuing this press release, the unaudited interim consolidated financial statements and the Management Discussion and Analysis ("MD&A"), including a reconciliation of non-GAAP financial measures, can be found on the Company's website at www.trimac.ca.
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 October 17, 2011 to shareholders of record at the close of business on September 30, 2011. This dividend is designated as an eligible dividend pursuant to subsection 89(14) of the Income Tax Act (Canada) and any applicable provincial legislation pertaining to eligible dividends.
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 and six month periods ended June 30, 2011 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 2141003) at 9:30 a.m. Eastern Time on Thursday, August 4, 2011. For North American participants, please dial 1-800-820-0231 or for international participants, please dial ++1-416-640-5926 at least 10 minutes prior to the start time of the call. An audio playback of the call will be available starting Friday, August 5, 2011 on our website at http://www.trimac.ca/page/eventscalendar.
SOURCE Trimac Transportation Ltd.
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