TransForce Delivers Consistent Results in the Third Quarter



    - Increased quarterly revenues 8% to $486.2 million
    - Generated EBITDA of $65.1 million

    MONTREAL, Oct. 24 /CNW Telbec/ - TransForce Income Fund (TSX: TIF.UN),
the leader in the Canadian transportation and logistics industry, today
announced results for the nine months and third quarter, ended September 30,
2007.
    Despite a challenging operating environment, the Fund increased revenues
by 8% to $486.2 million from $448.7 million in the third quarter of 2006.
EBITDA (earnings before interest, taxes, depreciation and amortization and
equivalent to operating income on TransForce's financial statements) was
$65.1 million in the quarter, consistent with $65.2 million in the same period
last year. Cash flow from operating activities, before net change in non-cash
working capital balances, was $50.8 million in the third quarter, compared
with $57.4 million in the third quarter of 2006.
    In the quarter, distributable cash from ongoing operations was
$54.6 million, compared with $60.4 million in the same quarter of 2006. The
Fund's regular distribution payout ratio, or cash distributed as a percent of
cash available for distribution, was 81.9% in the quarter, compared with 68.9%
a year earlier.
    "The disciplined application of our acquisition strategy meant we could
deliver increased revenues and solid bottom line results for our unitholders
while the North American industry continues to face difficult economic
conditions. We have continued to add to our operations for future growth
although this has meant an increase in interest expense for the shorter-term,"
said Alain Bédard, Chairman, President and Chief Executive Officer of
TransForce Income Fund. "Our operations continue to adjust to a weak market.
Parcel delivery has grown significantly while our Less Than Truckload segment
has experienced lower volumes. In central Canada, the strength of the Canadian
dollar has resulted in a continuing slowdown in the manufacturing and
automotive sectors. This has lowered LTL and TL volumes while creating pricing
pressures across the industry. In Western Canada, the oilfield services
division is being affected by the decline in drilling activity that has
worsened since the Alberta government's announcement of possible changes to
oil and gas royalties. The new royalty policy is to be announced shortly and,
depending on its effect on the energy industry, we will take the appropriate
action possibly including layoffs as others serving the drilling segment have
done."

    Year-to-Date Results

    TransForce increased revenues in the first nine months of 2007 to
$1.447 billion, from $1.338 billion in the same period in 2006. The Fund also
increased EBITDA to $181.9 million from $175.9 million in the first nine
months of 2006. Cash flow from operating activities, before net change in
non-cash working capital balances, was $148.1 million compared with $152.3
million in the same period of 2006.
    Distributable cash from ongoing operations for the year to date up to
September 30, 2007 was $155.4 million compared with $160.5 million in the same
period of 2006. Total distributions declared in the first three quarters of
the year were $96.3 million compared with $89.7 million in the same period of
2006. The Fund's regular distribution payout ratio, or cash distributed as a
percent of cash available for distribution, for the year-to-date is 86.1%
compared with 79.4% in the same period of 2006.
    "As expected, economic conditions continue to tighten as Canadian and
U.S. markets adjust to the significant changes in currency values. We see the
marketplace remaining challenging for the balance of 2007 and into the next
year," Mr. Bédard said. "TransForce is benefiting from its diversification
across geographies and market segments as a result of our acquisition
strategy, and our operating companies are adjusting to evolving market
conditions. We will continue to execute our proven acquisition strategy and
are well positioned to continue to create value for unitholders over the short
and longer term."

    Management Conference Call

    TransForce will host a conference call for investors to discuss the
results for the second quarter of 2007 today, October 24 at 9:00 a.m. Eastern
Time. Participating from the Fund will be Alain Bédard, Chairman, President
and Chief Executive Officer, and Salvatore Vitale, Chief Financial Officer.
    To participate in the teleconference, investors are invited to call
1-800-952-1797. A recording of the call will be available until midnight
October 31, 2007, by dialing 1-800-558-5253 or 416-626-4100 and entering
passcode 21353199. Media are invited to participate in listen-only mode and to
use the media contact listed below for further information.

    Financial Statements

    The financial statements for the periods ended September 30, 2007 and
2006 included below are an integral part of this news release.

    Profile

    TransForce Income Fund (www.transforce.ca) is the leader in Canada's
transportation and logistics industry. Headquartered in Montreal, Quebec, the
Fund's objective is to create value for unitholders through managing and
investing in a growing network of independent operating subsidiaries.
TransForce provides a comprehensive and unique combination of capabilities,
resources and geographical coverage in both domestic and trans-border markets.
Its companies operate in four well-defined business segments:

    
    - Less Than Truckload and Parcel Delivery;
    - Specialized Services, which includes its ancillary transportation
      services and fleet management & personnel services businesses;
    - Specialized Truckload; and
    - Truckload.

    TransForce's trust units (TIF.UN) are listed on the Toronto Stock Exchange
and are included in the S&P/TSX Composite Index.

    Forward-Looking Statements

    Except for historical information provided herein, this press release may
contain information and statements of a forward-looking nature concerning the
future performance of TransForce. These statements are based on suppositions
and uncertainties as well as on management's best possible evaluation of
future events. Such factors may include, without excluding other
considerations, fluctuations in quarterly results, evolution in customer
demand for TransForce's products and services, the impact of price pressures
exerted by competitors, and general market trends or economic changes. As a
result, readers are advised that actual results may differ from expected
results.
    For further details, please see the Financial Statements below. The
Financial Statements and Management's Discussion and Analysis can also be
found on Sedar at www.sedar.com and on the Fund's website www.transforce.ca.


    CONSOLIDATED STATEMENT OF INCOME
    (unaudited)
                             Three         Three          Nine          Nine
                            months        months        months        months
    (In thousands of         ended         ended         ended         ended
    dollars, except per  September     September     September     September
    unit amounts)         30, 2007      30, 2006      30, 2007      30, 2006

    Revenues               442,950       404,000     1,320,072     1,208,883
    Fuel surcharge
     revenues               43,261        44,689       126,549       129,140
    -------------------------------------------------------------------------
    Total revenues         486,211       448,689     1,446,621     1,338,023

    Expenses
    Operating expenses     347,914       317,069     1,034,302       957,240
    Fixed costs, general
     and administrative
     expenses               72,222        65,357       224,445       201,631
    Incentive plan             996         1,092         5,988         3,285
    -------------------------------------------------------------------------
    Operating income
     from continuing
     operations before
     the following:         65,079        65,171       181,886       175,867
      Depreciation of
       fixed assets         24,590        21,373        72,045        60,693
      Amortization of
       intangible assets     2,815         2,173         8,274         6,512
      Interest on
       long-term debt        9,466         3,953        25,192        12,421
      Other interest             0         1,537             0         5,176
      Gain on disposal
       of fixed assets        (987)       (3,693)       (2,228)       (4,633)
    -------------------------------------------------------------------------
    Income from continuing
     operations before
     provision for income
     taxes                  29,195        39,828        78,603        95,698
    Provision for income
     taxes
      Current                1,979         2,315         7,305         5,677
      Future                (1,287)         (471)       (4,369)       (4,061)
    -------------------------------------------------------------------------
                               692         1,844         2,936         1,616
    -------------------------------------------------------------------------

    Income from continuing
     operations             28,503        37,984        75,667        94,082
    Earnings from
     discontinued
     operations                  0           961             0         1,876
    -------------------------------------------------------------------------
    Net income              28,503        38,945        75,667        95,958

    Earnings per unit
    From continuing
     operations
      Basic                   0.33          0.44          0.88          1.12
      Diluted                 0.33          0.44          0.88          1.12
    Net earnings
      Basic                   0.33          0.45          0.88          1.14
      Diluted                 0.33          0.45          0.88          1.14
    -------------------------------------------------------------------------

    Outstanding
     weighted average
     number of
      Units             71,890,634    72,223,869    72,129,830    70,515,623
      Tracking shares   13,765,716    13,766,316    13,765,960    13,776,591
    -------------------------------------------------------------------------
       Total            85,656,350    85,990,185    85,895,790    84,292,214

    Units outstanding
    Number of Trust
     units of the Fund  73,024,381    73,023,781    73,024,381    73,023,781
    Number of Tracking
     shares             13,765,716    13,766,316    13,765,716    13,766,316
    -------------------------------------------------------------------------
    Total               86,790,097    86,790,097    86,790,097    86,790,097


    CONSOLIDATED BALANCE SHEETS

    (in thousands of dollars)                            As at         As at
                                                     September      December
                                                      30, 2007      31, 2006
                                                    (unaudited)     (audited)
    ASSETS
    Current assets
    Accounts receivable                                305,909       270,683
    Inventories                                          9,373         9,623
    Prepaid expenses                                    17,342        14,998
    -------------------------------------------------------------------------
                                                       332,624       295,304
    -------------------------------------------------------------------------
    Fixed assets                                       634,834       533,054
    Goodwill                                           372,423       320,716
    Intangible assets                                   57,205        52,642
    Other assets                                         8,112         8,688
    Future income taxes                                  5,204         5,315
    -------------------------------------------------------------------------
                                                     1,410,402     1,215,719
    -------------------------------------------------------------------------
    LIABILITIES AND UNITHOLDERS' EQUITY
    Current liabilities
    Bank indebtedness                                    2,856        20,223
    Accounts payable and accrued liabilities           200,967       177,846
    Cash distributions payable to unitholders            9,675         9,310
    Dividends payable on Tracking Share Units of
     TFI Holdings Inc.                                   1,923         2,134
    Income taxes payable                                 3,123         4,765
    Current portion of long-term debt                   34,886        35,758
    -------------------------------------------------------------------------
                                                       253,430       250,036
    -------------------------------------------------------------------------
    Long-term debt                                     573,110       358,624
    Non-controlling interest                             2,450         2,002
    Asset retirement obligations                         3,636         3,660
    Future income taxes                                 22,007        22,147

    Unitholders' equity
    Capital contributions and Tracking Share Units     519,404       519,404
    Contributed surplus                                  1,022           336
    Units held by the Fund for long-term incentive
     plan                                              (13,832)      (11,136)
    Retained earnings                                   49,175        70,646
    -------------------------------------------------------------------------
                                                       555,769       579,250
    -------------------------------------------------------------------------
                                                     1,410,402     1,215,719
    -------------------------------------------------------------------------


    CONSOLIDATED STATEMENT OF RETAINED EARNINGS
    (unaudited)

                             Three         Three          Nine          Nine
                            months        months        months        months
                             ended         ended         ended         ended
    (in thousands of     September     September     September     September
    dollars)              30, 2007      30, 2006      30, 2007      30, 2006

    Retained earnings,
     beginning of period    53,325        55,498        70,646        57,963
    Net income for the
     period                 28,503        38,945        75,667        95,958
    Distributions to
     unitholders           (29,028)      (27,505)      (86,352)      (80,186)
    Dividends on Tracking
     Share Units of TFI
     Holdings Inc.          (3,625)       (3,376)      (10,786)      (10,173)
    -------------------------------------------------------------------------
    Retained earnings,
     end of period          49,175        63,562        49,175        63,562
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (unaudited)
                             Three         Three          Nine          Nine
                            months        months        months        months
                             ended         ended         ended         ended
    (in thousands of     September     September     September     September
    dollars)              30, 2007      30, 2006      30, 2007      30, 2006

    CASH FLOW FROM
     OPERATING ACTIVITIES
    Net income for the
     period                 28,503        38,945        75,667        95,958
    Non-cash items:
      Depreciation of
       fixed assets         24,590        21,941        72,045        62,549
      Amortization of
       intangible assets     2,815         2,173         8,274         6,512
      Incentive plan
       expense                 996         1,092         5,988         3,285
      Purchase of units
       held by the Fund
       for the Incentive
       plan                 (4,000)       (3,090)       (7,998)       (8,554)
      Deferred financing
       charges                 166             0           476             0
      Future income taxes   (1,287)          (19)       (4,369)       (3,178)
      (Gain) Loss on
       disposal of fixed
       assets                 (987)       (3,697)       (2,228)       (4,639)
      Other                     35            38           275           335
    -------------------------------------------------------------------------
                            50,831        57,383       148,130       152,268

    Net change in non-cash
     working capital
     balances related to
     operations                912        (9,520)      (12,037)      (25,264)
    -------------------------------------------------------------------------
                            51,743        47,863       136,093       127,004
    -------------------------------------------------------------------------


    CASH FLOW FROM
     FINANCING ACTIVITIES
    Increase in (repayment
     of) bank advances and
     overdraft              (9,082)       57,096       (17,367)      123,827
    Increase in long-term
     debt                    1,655             0         2,211             0
    Repayment of long-term
     debt                   (9,206)      (19,924)      (40,091)      (67,629)
    Increase (decrease) in
     new long term revolver
     facility               22,500             0       175,900             0
    Cash distributions paid
     to unitholders        (29,028)      (27,505)      (85,987)      (83,543)
    Dividends paid on
     Tracking Share Units   (3,357)       (3,221)      (10,997)      (11,026)
    Issuance of trust units      0             0             0       143,760
    -------------------------------------------------------------------------
                           (26,518)        6,446        23,669       105,389
    -------------------------------------------------------------------------

    CASH FLOW FROM
     INVESTING ACTIVITIES
    Additions to fixed
     assets                (21,811)      (24,235)     (100,679)      (68,849)
    Proceeds from disposal
     of fixed assets         5,121         8,875        15,109        20,365
    Business acquisitions
     (including bank
     advances net of cash)  (8,584)      (39,521)      (75,219)     (186,218)
    Other assets, net           49           572         1,027         2,309
    -------------------------------------------------------------------------
                           (25,225)      (54,309)     (159,762)     (232,393)
    -------------------------------------------------------------------------

    Net change in cash and
     cash equivalent
     during the period           0             0             0             0
    Cash and cash
     equivalent, beginning
     of the period               0             0             0             0
    -------------------------------------------------------------------------
    Cash and cash
     equivalent, end of
     the period                  0             0             0             0
    -------------------------------------------------------------------------

    Supplemental cash flow
     information:
      Cash paid during the
       period for:
      Interest               9,474         5,332        25,084        17,281
      Income taxes           1,393         1,652         7,319         7,397
    -------------------------------------------------------------------------



    Distributable cash

                             Three         Three          Nine          Nine
                            months        months        months        months
    (in thousands of         ended         ended         ended         ended
    dollars, except      September     September     September     September
    per unit amounts)     30, 2007      30, 2006      30, 2007      30, 2006

    OPERATING ACTIVITIES
    Cash flow from
     operating activities   51,743        47,863       136,093       127,004
    Add (deduct):
      Purchase of units
       held by the Fund
       for long-term
       incentive plan        4,000         3,090         7,998         8,554
      Net change in
       non-cash working
       capital                (912)        9,520        12,037        25,264
      Deferred financing
       charges                (166)            0          (476)            0
      Other                    (35)          (38)         (275)         (335)
    -------------------------------------------------------------------------
    Distributable cash from
     operating activities   54,630        60,435       155,377       160,487
    -------------------------------------------------------------------------

    INVESTING ACTIVITIES
    Sustaining capital
     expenditures (note 1) (16,862)      (19,942)      (49,965)      (51,984)
    Proceeds from disposal
     of investment               0             0             0             0
    Proceeds from disposal
     of fixed assets         5,121         8,875        15,109        20,365
    -------------------------------------------------------------------------
    Distributable cash from
     investing activities  (11,741)      (11,067)      (34,856)      (31,619)
    -------------------------------------------------------------------------

    FINANCING ACTIVITIES
    Long term Incentive
     plan disbursement           0             0             0             0
    Scheduled debt
     repayment (note 2)     (2,614)       (3,718)       (6,778)      (13,254)
    -------------------------------------------------------------------------
    Distributable cash from
     financing activities   (2,614)       (3,718)       (6,778)      (13,254)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Total distributable
     cash                   40,275        45,650       113,743       115,614

    Total distribution
     declared
    Distribution declared
     to Tracking
     shareholders (note 3)   3,357         3,221         9,981         9,512
    Distribution declared
     to Unitholders         29,028        27,505        86,352        80,186
    -------------------------------------------------------------------------
    Total distribution
     declared               32,385        30,726        96,333        89,698
    -------------------------------------------------------------------------
    Distributable cash
     surplus                 7,890        14,924        17,410        25,916
    -------------------------------------------------------------------------

    Total distribution
     declared per unit
    Distribution declared
     to Tracking
     shareholders           0.2439        0.2340        0.7251        0.6906
    Distribution declared
     to Unitholders         0.3975        0.3825        1.1825        1.1300
    -------------------------------------------------------------------------

    Distributable cash
     earned per unit
    Tracking shareholders   0.3213        0.3590        0.9098        0.9318
    Unitholders             0.4853        0.5549        1.3738        1.4229
    -------------------------------------------------------------------------

    Payout ratio - Total
     distribution             81.9%         68.9%         86.1%         79.4%
    -------------------------------------------------------------------------


    Note 1: Sustaining capex

    On July 1, 2005, the Fund concluded the sale of its Calgary terminal. The
Fund will relocate this terminal to a new facility in Calgary. As part of this
relocation, the Fund has invested $10.8 million for the nine-month period
ended September 30, 2007 in the new Calgary facility ($3.1 million - 2006),
This investment has been excluded from distributable cash. Also the Fund
invested $39.8 million as part of a lease buyout for three terminals.
($13.8 million - 2006). This has also been excluded from distributable cash.

    Note 2: Scheduled debt repayment excludes:

    1) Debt payments made on debt acquired as part of business acquisitions.
       This totals $33.3 million for the nine-month period ended September
       30, 2007 ($54.4 million - 2006).
    2) Term loan due on September 30, 2013 of $160 million, the revolving
       term loan due on September 30, 2010 of $297.4 million and single
       payment due on July 15, 2009 of $27.9 million to CIT Financial Ltd for
       its 5 year term loan.  The total scheduled debt payable as at
       September 30, 2007 totals $40.4 million ($59.2 million - 2006)

    Note 3: Tracking shareholders dividend

    Dividend declared to Tracking shareholders net of income taxes excludes a
holdback portion which is due and payable to Tracking shareholders no later
than March 31 of the following fiscal year in which the dividend was declared.
    
    %SEDAR: 00018303E




For further information:

For further information: Investors: Alain Bédard, Chairman, President
and CEO, TransForce Income Fund, (514) 331 4200; Media: John Lute, Lute &
Company, (416) 929 5883, jlute@luteco.com

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TRANSFORCE INCOME FUND

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