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SOURCE Trimac Transportation Ltd.
Highlights for the third quarter:
CALGARY, Oct. 30, 2013 /PRNewswire/ - Trimac Transportation Ltd. (TSX: TMA) ("Trimac" or the "Company"), Canada's leader in bulk trucking, announces the release of its financial results for the three months ended September 30, 2013 ("current quarter").
Total revenue improved $3.1 million (or 2.9%) for the current quarter to $109.4 million from the $106.3 million reported for the three months ended September 30, 2012 ("prior quarter") while revenue before fuel surcharges improved by 3.0% to $97.5 million in the current quarter. Increases were experienced primarily in the bulk trucking segment where revenue before fuel surcharges increased by $2.4 million. Growth from new business awards in resource commodities and increased volumes in dry bulk commodities and chemical hauling contributed to the increase.
For the nine months ended September 30, 2013 ("current year") revenue before fuel surcharges grew $27.0 million which included $19.6 million of revenue before fuel surcharges from 2012 acquisitions. Resource and pressurized commodities and petroleum hauling experienced growth from new business awards while most of the remaining operations experienced various levels of growth with existing customers.
Operating expenses, which includes direct costs net of fuel surcharges revenue and selling and administrative costs, increased 3.1 percent over the prior quarter to $82.5 million. As a percentage of revenue before fuel surcharges operating expenses remained flat compared to prior quarter. Improved operating efficiencies were partially negated by increases in administration costs due to annual inflation adjustments, restructuring costs, and expanded operations. These administration costs increases were partially offset by reductions in training and insurance costs.
Year to date operating expenses as a percentage of revenue before fuel surcharges experienced a slight increase of 0.7 percent over the prior year. In absolute dollars, operating expenses of $244.9 million increased $26.8 million or 12.3 percent. Productivity inefficiencies attributable to plant shutdowns, lower demand with certain customers, weather related construction delays, and severe weather conditions in the first quarter also contributed to the rise in operating expenses. Increased administration costs associated with the corporate office move and salary increases due to inflation adjustments also negatively impacted operating expenses in the current year.
Operating earnings decreased in the current quarter to $8.1 million from $8.3 million in the prior quarter. For the current year operating earnings decreased 3.6 percent primarily due to an increase in depreciation expense. Current year depreciation expense included $1.2 million from the 2012 acquisitions.
Pre-tax earnings for the current quarter were $6.5 million compared to $7.5 million in the prior quarter. This decrease was primarily the result of a $0.9 million expense recorded for a favourable revaluation of a forward contract relating to Trimac's obligation to acquire the remaining 40 percent of Fortress Trucking Limited.
Earnings per share remained flat at 21 cents for both the current and prior quarters while for the year earnings per share decreased to 39 cents from 41 cents in the prior year.
|Three months ended Sept 30||Nine months ended Sept 30|
|(in millions of dollars, except per share data)||2013||2012||Variance||2013||2012||Variance|
|Revenue before fuel surcharges||97.5||94.7||3.0%||281.0||252.0||11.5%|
|Fuel surcharge revenue||(12.0)||(11.6)||3.4%||(35.8)||(35.0)||2.3%|
|Net direct costs||68.0||66.2||2.7%||201.4||179.7||12.1%|
|Selling and administrative||14.5||13.8||5.1%||43.5||38.4||13.3%|
|Total operating expenses||82.5||80.0||3.1%||244.9||218.1||12.3%|
|Adjusted EBITDA (1)||15.0||14.7||2.0%||36.1||33.9||6.5%|
|Depreciation & amortization||6.9||6.4||7.8%||20.0||17.2||16.3%|
|Finance & other costs||1.6||0.8||100.0%||3.3||2.0||65.0%|
|Earnings before income tax expense||6.5||7.5||-13.3%||12.8||14.7||-12.9%|
|Income tax expense||1.7||1.7||0.0%||2.9||3.3||-12.1%|
|Net income before revaluation of non-controlling interest||4.8||5.8||-17.2%||9.9||11.4||-13.2%|
|Adjusted net income (1)||5.8||5.8||0.0%||10.8||11.3||-4.4%|
|Cash generated from operations||15.4||14.3||7.7%||36.7||33.7||8.9%|
|Operating ratio before interest & tax (1)||91.5%||91.0%||0.5%||94.1%||93.1%||1.1%|
|Adjusted free cash flow (1)||10.4||7.6||36.8%||16.7||14.6||14.4%|
|Cash generated from operations per share||0.55||0.51||1.31||1.24|
|Cash dividends declared per share||0.07||0.07||0.21||0.20|
|Earnings per share - adjusted (1)||0.21||0.21||0.39||0.41|
|Earnings per share (basic)||0.21||0.21||0.39||0.42|
|Share price - Sept 30||5.23||5.45||5.23||5.45|
|Net property, plant and equipment additions||7.5||10.6||27.3||31.2|
|(1) See "Reconciliation of Non-GAAP Financial Measures" section.|
Management believes revenues in the fourth quarter will be similar to the prior year. Our focus will continue to be on cost management during these volatile times by eliminating unnecessary costs and right sizing our fleet to ensure we remain competitive. We are pleased with the recent business awards and look forward to the opportunity to build strong relationships with these customers.
Declaration of Quarterly Dividend
The Board of Directors today declared a dividend of $0.07 per share on the Class A shares, payable on January 15, 2014 to shareholders of record at the close of business on December 31, 2013.
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 nine months ended September 30, 2013 for a discussion of 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.
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.
You are invited to join us on a conference call (conference ID number 7190637) at 3:00 p.m. Eastern Time on Thursday, October 31, 2013. For North American participants, please dial 1-866-321-6651 or for international participants, please dial ++1-416-642-5212 at least 10 minutes prior to the start time of the call. An audio playback of the call will be available starting Friday, November 1, 2013 on our website at http://www.trimac.com/page/eventscalendar.
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