Trimac Announces Fourth Quarter, Year End Results



    CALGARY, March 8 /CNW/ - Trimac Income Fund (TSX Symbol TMA.UN) (the
"Fund") today released the financial results of the Fund and Trimac
Transportation Services Limited Partnership ("Trimac" or the "Partnership")
for the fourth quarter and for the fiscal year ended December 31, 2006.

    
                                      Three months                      Year
                                 ended December 31,        ended December 31,
    Partnership                  2006         2005         2006         2005
                           --------------------------------------------------
                                            (millions of dollars)

    Revenues                     79.8         85.0        323.4        313.6
    EBITDA(1)                    10.6         12.5         42.4         41.0
    Net earnings                  3.1          5.7         17.0         15.4


                                                                        From
                                                                 February 25
                               Three months ended    Year ended           to
    The Fund                        December 31,    December 31, December 31,
                                 2006         2005         2006         2005
                           --------------------------------------------------
                                  (millions of dollars, except per unit
                                       amounts and numbers of units)

    Distributable cash
     per unit(1)(2)           $0.2322      $0.3937      $1.0370      $1.1094
    Distributions per
     unit(1)                  $0.2313      $0.2187      $0.9168      $0.7386
    Basic and diluted
     earnings per unit        $0.0785      $0.1276      $0.3805      $0.3265
    Weighted average number
     of units used in
     computing basic
     earnings per unit     12,528,515   12,528,515   12,528,515   12,528,515
    Weighted average
     number of units
     outstanding used in
     computing diluted
     earnings per unit     23,306,366   22,767,238   23,306,366   22,767,238

    (1) EBITDA, distributable cash per unit, and distributions per unit are
        not recognized measures under Generally Accepted Accounting
        Principles (GAAP) and do not have a standardized meaning prescribed
        by GAAP. Therefore, these amounts may not be comparable to similar
        measures presented by other issuers. Management considers EBITDA and
        Distributable cash as key measures that indicate the ability of the
        Fund to meet its capital and financing commitments.
    (2) Distributable cash available will fluctuate on a monthly basis due to
        seasonal cash flows, sustaining capital incurred and income taxes and
        interest paid. See "Distributable Cash" for additional commentary.

    Trimac finished the year with solid results, including a 4.5 percent
increase in distributed cash per unit in 2006 over the annualized 2005 amount
and achieved a payout ratio(3) of 88 percent.

        -  Results for the quarter were impacted by reduced activity in the
           Alberta and B.C. oil and natural gas sector, severe winter
           conditions and continued volatility in our woodchip volumes. Given
           the challenging operating environment and reduced volumes,
           management was pleased with the level of profitability achieved.

    (3) Payout ratio is equal to cash distributions declared expressed as a
        percent of distributable cash. Management believes the payout ratio
        indicates the ability of the Fund to meet its capital and financing
        commitments.

    Divisional highlights in the fourth quarter were as follows:

        -  Despite a $3.4 million decline in revenue, due primarily to lower
           woodchip volumes, the western division operations performed well.
           EBITDA returns decreased modestly from 17.0 percent in the 4th
           quarter of 2005 to 16.5 percent in the current quarter, due to
           reduced volumes and higher operating costs;

        -  Eastern division operations achieved significant improvements in
           EBITDA returns, which increased from 10.6 percent in the 4th
           quarter of 2005 to 12.3 percent in the 4th quarter of 2006.
           Revenues declined by $1.8 million from the prior year's 4th
           quarter;

        -  Bulk Plus Logistics (BPL) operations experienced some erosion of
           profitability resulting from higher transload and freight
           brokerage operating expenses in the quarter. Revenues were
           unchanged from the prior year's 4th quarter; and

        -  Trimac completed the first quarter of operations with its newly
           acquired business, Jeffbrett Group of Companies ("JBG"), which was
           integrated into eastern division operations.
    

    In commenting on the results for the 4th quarter, Terry Owen, President &
CEO of Trimac, said:
    "As we look back at 2006, we are pleased with the full year's results as
we have completed our third consecutive year of solid growth and improved
profitability.
    In the quarter, the western division was impacted by lower activity in
the oil and natural gas sector in western Canada and by severe winter weather.
This contrasted dramatically with the 4th quarter of 2005 in which we enjoyed
extremely favourable weather and significantly higher oil and natural gas
drilling activity.
    We continue to face significant increases for driver and mechanic wage
costs across western Canada. Our goals will be to ensure that our compensation
packages remain competitive and that we recover resultant cost increases from
the marketplace. As management indicated in the previous two quarters, the
forestry industry continued to be volatile, which resulted in significant
revenue declines in our woodchip operations during the fourth quarter.
    We were very pleased with the improved quality of revenue and profit in
our eastern division, despite a less than robust operating environment. The
restructuring and refining of our operations provided excellent results in the
quarter, despite lower volumes and competitive pressures in the marketplace.
JBG was fully integrated into the eastern division operations during the 4th
quarter.
    Our logistics businesses in the U.S. and Canada enjoyed revenue on par
with last year's 4th quarter. Offsetting this was additional operating costs
in our transload operations and higher freight brokerage payments, both of
which impacted profitability in the quarter."

    In commenting on the future activities and outlook for the business,
Terry Owen noted:

    "As we look ahead to 2007, we see continued strength in the western
division, despite the likelihood of reduced activity related to the oil and
natural gas industry. We expect ongoing volatility in our woodchips volumes
due to further restructuring and consolidation in the forestry industry. In
our eastern division, we believe that reduced manufacturing levels and the
modest economic activity experienced in the latter half of 2006 will continue,
resulting in a similar environment in 2007.
    The hallmark of Trimac's strategy is stability through diversification
within the bulk-trucking sector. We are diversified by customer, product,
industry, and geography. This diversification, together with acquisitions and
new business awards, cause us to be optimistic when assessing the outlook for
our business."

    
                             Financial Highlights

                                Three months ended             Year ended
    Partnership                     December 31,              December 31,
                           --------------------------------------------------
                                 2006         2005         2006         2005
                           --------------------------------------------------

                                            (millions of dollars)
    Revenues
    Western                      44.6         48.0        181.6        177.5
    Eastern                      31.1         32.9        124.5        119.3
                           --------------------------------------------------
    Canadian trucking            75.7         80.9        306.1        296.8
    Bulk Plus Logistics           4.1          4.1         17.3         16.7
    Other                           -            -            -          0.1
                           --------------------------------------------------
                                 79.8         85.0        323.4        313.6
    Direct costs                 57.0         61.7        235.7        230.1
    Selling and
     administrative              12.2         10.8         45.3         42.5
                           --------------------------------------------------

    EBITDA(1)                    10.6         12.5         42.4         41.0
    Depreciation net of
     gains on disposal of
     capital assets               5.9          5.6         20.5         21.8
                           --------------------------------------------------

    Operating earnings            4.7          6.9         21.9         19.2
    Interest expense (net)        1.0          1.1          4.0          3.8
                           --------------------------------------------------

    Earnings before taxes         3.7          5.8         17.9         15.4
    Income tax expense
     (recovery)                   0.6          0.1          0.9            -
                           --------------------------------------------------

    Net earnings                  3.1          5.7         17.0         15.4
                           --------------------------------------------------
                           --------------------------------------------------

    As a percentage of revenue
    --------------------------
    Direct costs                 71.4%        72.6%        72.9%        73.4%
    Selling and administrative   15.3%        12.7%        14.0%        13.6%
    EBITDA(1)                    13.3%        14.7%        13.1%        13.1%
    Depreciation                  7.4%         6.6%         6.3%         7.0%
    Operating earnings            5.9%         8.1%         6.8%         6.1%

                                 As at December 31,
                                 2006         2005
                           -------------------------
                               (millions of dollars)

    Total assets(2)             157.9        152.1
    Total long-term
     liabilities(2)              61.6         57.2

    (1) EBITDA (earnings before interest, taxes, depreciation and
        amortization) is not a recognized measure under GAAP, does not have a
        standardized meaning prescribed by GAAP and, therefore, may not be
        comparable to similar measures presented by other issuers. Management
        believes that EBITDA is a useful measure of cash available for
        distribution before debt service expense, capital expenditures and
        income taxes and that indicates the ability of the Fund to meet its
        capital and financing commitments.
    (2) The majority of the increase in total assets and long-term
        liabilities is due to the October 2, 2006 acquisition of the
        Jeffbrett Group of Companies.


    Distributable Cash

    The table below represents the Partnership's distributable cash beginning
with net cash provided by operations.


    (millions of dollars                                         February 25
     except unit amounts,       Three months ended   Year ended           to
     certain percentages            December 31,    December 31, December 31,
     and numbers of units)       2006         2005         2006         2005
    -----------------------------------------------  ------------------------
    Net cash provided by
     operations                  14.2         12.7         41.1         39.5
    Net change in non-cash
     working capital(1)          (4.7)        (1.5)        (2.8)        (6.6)
                           ------------------------  ------------------------
    Cash provided by
     operations                   9.5         11.2         38.3         32.9
    Less adjustment for:
      net sustaining capital
       expenditures
      (net of proceeds)(2)(3)    (1.8)        (1.6)       (10.5)        (6.6)
      provision for
       sustaining capital
       commitments(4)            (1.1)           -         (1.1)           -
      provision for long-term
       unfunded contractual
       operational
       obligations(5)            (0.3)           -         (0.3)           -
                           ------------------------  ------------------------
    Total estimated cash
     available for
     distribution (before
     public expenses)             6.3          9.6         26.4         26.3
    Percentage of available
     cash distributable to
     unitholders(6)                54%          55%          54%          55%
    Cash available for
     distribution to
     unitholders (before
     public expenses)             3.3          5.2         14.2         14.5
    Public expenses(7)           (0.4)        (0.3)        (1.2)        (0.6)
                           ------------------------  ------------------------
    Distributable cash from
     operations(2)(8)             2.9          4.9         13.0         13.9
    Distributions declared
     and payable                  2.9          2.8         11.5          9.3

    Distributable cash
     per unit(8)               0.2322       0.3937       1.0370       1.1094
    Distributions declared
     per unit                  0.2313       0.2187       0.9168       0.7386
    Payout ratio(2)(8)           99.6%        55.5%        88.4%        66.6%

    Weighted average
     number of units
     outstanding           12,528,515   12,528,515   12,528,515   12,528,515

    Net capital expenditures
      Sustaining capital
       expenditures(2)            2.3          1.9         14.5          8.8
      Proceeds on disposal
       of capital assets         (0.5)        (0.3)        (4.0)        (2.2)
                           ------------------------  ------------------------
      Net sustaining capital
       expenditures(2)(3)         1.8          1.6         10.5          6.6
      Growth capital
       expenditures(2)(9)         3.0          0.5         15.7          2.2
                           ------------------------  ------------------------
                                  4.8          2.1         26.2          8.8
                           ------------------------  ------------------------
                           ------------------------  ------------------------

    (1) Changes in non-cash operating assets and liabilities are not included
        in the calculation of distributable cash. Working capital investments
        are funded through a combination of cash flow not distributed and the
        use of credit facilities available to the Partnership.
    (2) Distributable cash from operations, sustaining capital expenditures,
        net sustaining capital expenditures, payout ratio, and growth capital
        expenditures are not measures recognized by GAAP, do not have
        standardized meanings prescribed by GAAP and may not be comparable to
        similarly named measures presented by other issuers. Management
        believes that they are important and useful measures for readers to
        evaluate the performance of the Fund.
    (3) Net sustaining capital expenditures refers to capital expenditures,
        net of proceeds on the sale of capital assets, which are necessary to
        sustain current revenue levels. See "Capital Expenditures".
    (4) Represents the total commitment on a capital project commenced in
        2006 less amounts expended to December 31, 2006.
    (5) Represents a provision for cash requirements relating to a long-term
        incentive plan and an executive pension liability.
    (6) Percentage is equal to units outstanding of 12,528,515 divided by
        fully diluted units of 23,306,366.
    (7) Represents expenses associated with the Fund's status as a reporting
        issuer.
    (8) Distributable cash available will fluctuate on a monthly basis due to
        seasonal cash flows, sustaining capital expenditures incurred, income
        taxes paid, and interest costs on outstanding debt. The distributable
        cash payout ratio in 2005 was influenced by stronger-than-expected
        cash flows in the prior year's 4th quarter and reduced sustaining
        capital requirements in 2005. The reductions in sustaining capital
        purchases were due primarily to reduced replacement trailers
        resulting from redeployment of excess woodchip and petroleum
        trailers.
    (9) Cash used to fund growth capital expenditures does not affect
        distributable cash to unitholders where financing is available for
        these purposes. The Partnership funded Growth capital in 2006 and
        2005 with retained cash and its existing line of credit.
    

    Distributable cash from operations of $13.0 million for the year ended
December 31, 2006 decreased by $0.9 million from the period February 25, 2005
to December 31, 2005. The decrease was due primarily to the increase in
sustaining capital expenditures and, to a lesser extent, increased public
expenses. Distributions for the year ended December 31, 2006 were paid using
cash generated from operations during the year. Due to the seasonal nature of
the Partnership's business and timing of sustaining capital purchases, the
amount of distributable cash may vary from quarter to quarter. Trimac's Board
of Directors approves the level of monthly distributions based upon estimated
cash flow on an annual basis, less estimated cash amounts required for debt
service obligations, sustaining capital expenditures, cash taxes, other
expense amounts and reserves (including amounts for capital expenditures and
working capital) and to stabilize the monthly amount of distributions to
unitholders. Growth capital purchases are funded from the Partnership's
retained cash or credit facilities to the extent of undrawn limits available.
    Distributable cash from operations is not a defined term under Canadian
generally accepted accounting principles (GAAP) but is determined by the
Partnership as net cash provided by operations for the period, adjusted to
remove specific non-cash items, including changes in working capital, and
reduced by sustaining capital expenditures, reserves for funding long-term
liabilities, reserves for committed capital purchases in progress and public
costs.
    Management believes that distributable cash from operations is a useful
supplemental measure of performance as it provides investors with an
indication of the amount of cash available for distribution to unitholders.
Investors are cautioned, however, that distributable cash from operations
should not be construed as an alternative to using net income as a measure of
profitability or as an alternative to the statement of cash flows. In
addition, the Fund's method of calculating distributable cash from operations
may not be comparable to calculations used by other income trusts.

    Operating Results

    Trimac's revenue in the fourth quarter of 2006 (the "current period")
totalled $79.8 million, a $5.2 million decrease from the fourth quarter of
2005 (the "prior period"). The lower revenue was primarily responsible for a
reduction in cash provided by operations of $1.7 million in the quarter.
    In the year ended December 31, 2006 (the "current year"), the
Partnership's revenue increased by $9.8 million or 3.1 percent to
$323.4 million from $313.6 million in the year ended December 31, 2005 (the
"prior year"). Cash provided by operations in the current year increased by
$1.3 million or 3.5 percent to $38.3 million from $37.0 million in the prior
year.

    Bulk Trucking Operations

    Fourth Quarter

    The western division generated $44.6 million in revenue in the current
period, a decrease of $3.4 million or 7.0 percent from the prior period.
Woodchip revenue fell by 35.5 percent due to the challenging operating
environment caused by the struggling forestry industry. In addition, lower oil
and natural gas activity in Alberta and British Columbia, extreme weather in
southern B.C. and Alberta, and lower fuel surcharge revenue of $0.8 million
contributed to the reduced revenues in the current period. Excluding woodchip
revenue declines, the western division's remaining operations recorded a
1.8 percent increase over the prior period with recently awarded contracts
increasing revenue in the petroleum and chemical product lines. Lower revenue,
weather-related operating cost increases, reduced equipment utilization due to
winter weather, and higher wages resulting from escalating wages across
western Canada were the factors contributing to a $0.7 million decrease in
EBITDA for the western division to $7.4 million in the current period.
    The eastern division's revenue in the current period totalled
$31.1 million, $1.8 million or 5.5 percent less than in the prior period. The
acquisitions of JBG on October 2, 2006 and Energy Transportation (ET), a
division of Superior Propane, on December 1, 2005 contributed $3.9 million of
increased revenues in the current period. Offsetting this revenue gain were
reduced fuel surcharge revenue of $0.7 million, the loss of a slag-hauling
contract during the 2nd quarter of 2006, lower chemical and plastic volumes
due to reduced manufacturing demand in central Canada, and the exiting of
non-compensatory petroleum business in Atlantic Canada. Despite the lower
revenue, EBITDA for the eastern division improved by $0.3 million to $3.8
million in the current period. The elimination of non-compensatory petroleum
business in Atlantic Canada, increased compressed gas business from the
acquisition of ET, improved wash operations as a result of the closure of the
Oakville tote cleaning facility and additional volumes from the JBG
acquisition more than offset the impact of lower revenue in the current
period.

    Annual

    The western division's annual revenue grew to $181.6 million in the
current year, an increase of $4.1 million or 2.3 percent from the prior year.
The division achieved strong revenue growth of approximately 10.3 percent in
its B.C., Prairie Provinces and commercial shop and wash operations. Revenue
increased due to higher fuel surcharges of approximately $5.8 million and grew
from continued strong oil and natural gas activity and healthy economic
conditions throughout western Canada. Gains occurred in the petroleum, cement,
and chemical product lines in the current year due to growth with existing
customers, increased sales in commercial shop and wash operations, and new
business awards in the Prairie Provinces. The division's woodchip operation
was significantly impacted by temporary and permanent closures of sawmills and
pulp mills during 2005 and 2006, resulting in a 20.4 percent decline in
revenue from the prior year.
    Except for the woodchip product line, all Western division operations
experienced year-over-year growth. The division generated EBITDA of
$27.9 million in the current year, an increase of $1.6 million over the prior
year. The improved EBITDA resulted from business awards, increased operating
efficiencies, and higher volumes in Trimac's commercial shop and wash
business, partially offset by the reduced EBITDA from the woodchip operations.
    The eastern division's revenue grew from $119.3 million in the prior year
to $124.5 million in the current year, an increase of $5.2 million or
4.4 percent. The increased revenue was due to higher fuel surcharges of
$2.2 million and growth from existing customers in the chemical, petroleum,
plastics, and compressed gas product lines for the central Canadian
operations. In addition, the acquisition of JBG on Oct 2, 2006 contributed
$2.0 million of revenue for the current year. Business declines resulted from
the exiting of non-compensatory petroleum business during 2005 and 2006 in
Atlantic Canada, the closure of a non-compensatory tote cleaning facility in
September 2005, the loss of a slag-hauling contract in southern Ontario in the
second quarter of 2006, and reduced cement volumes as a result of lower
economic activity in central Canada.
    EBITDA for the eastern division improved to $13.3 million in the current
year from $11.0 million in the prior year, an increase of $2.3 million or
20.9 percent. Ontario and Quebec operations achieved improved profitability
due to strong revenue growth in the product lines mentioned above, reductions
in non-compensatory petroleum business in Atlantic Canada, shop and wash
operation efficiencies, closure of the Oakville tote cleaning facility in
September 2005, and the acquisition of ET in December 2005 and of JBG in
October 2006.

    Logistics Operations

    BPL's current period revenue was $4.1 million, unchanged from the prior
period. The Canadian operation's revenue decreased by $0.2 million from the
prior period due to lower transload volumes. BPL's U.S. operations achieved an
increase of 24.3 percent in U.S. dollars, with freight brokerage and
third-party logistics more than offsetting reduced transload revenues. The
strengthening Canadian dollar reduced the U.S. revenue increase in the current
period to 21.0 percent after translation into Canadian dollars. BPL's EBITDA
decreased by $0.4 million from the prior period due to higher operating costs
for transload and brokerage business, increased administration costs, and
reduced gain-sharing income from U.S. logistics customers.
    BPL's current year revenue was $17.3 million, an increase of $0.6 million
or 3.6 percent over the prior year. BPL's Canadian freight brokerage volume
gains more than offset reduced transload revenue, resulting in a $0.4 million
improvement from the prior year. In the U.S., freight brokerage and
third-party logistics management volumes were responsible for the solid growth
of approximately 13.2 percent in U.S. dollars over the prior year. The
strengthening Canadian dollar reduced BPL's U.S. revenue growth to 5.7 percent
in the current year when converted to Canadian dollars.
    BPL's EBITDA was $1.7 million in the current year, a decrease of
$0.4 million from the prior year. Higher transload operating expenses and
clean-up costs relating to the 3rd quarter product spill more than offset
improvements in selling and administrative expenses and incremental cash flow
from logistics business secured in the U.S.

    Capital Expenditures

    The Partnership's net capital expenditures, including growth and
sustaining capital, totalled $26.2 million in the current year compared to
$14.5 million in the prior year. Adjusting for the one-time $4.9 million
Waneta transload lease buy-out in February 2005, net capital expenditures in
the current year were $16.6 million higher than in the prior year. The
increase in net capital expenditures consisted of gross sustaining capital
purchases of $4.8 million and higher growth capital of $13.3 million,
partially offset by incremental disposal proceeds of $1.5 million.
    Increased growth capital spending of $13.3 million in the current year
was due to significant new business awards and $2.4 million of tractor
purchases required to replace short-term leases relating to the December 2005
acquisition of ET. Tractors and trailers accounted for approximately
96 percent of growth capital expenditures in the year. Growth capital
purchases are funded from the Partnership's retained cash or credit facilities
to the extent of undrawn limits available.
    Gross sustaining capital purchases of $14.5 million in the current year
were made up of replacement tractors and trailers, accounting for
approximately 79 percent of the total, with the balance applicable to other
assets required in the operations. Net sustaining capital purchases were
$3.3 million higher than in the prior year, due primarily to reduced spending
in the prior year resulting from the redeployment of excess equipment in
woodchips and petroleum operations. The increased proceeds on disposal of
$1.5 million over the prior year were due primarily to the sale of excess land
in Edmonton. Net annual capital expenditures relating to sustaining capital
requirements will vary from year to year based on the economic life of the
capital assets, historical purchase dates, the mix of life cycles expiring in
a given year, other factors affecting equipment cost, disposal proceeds of
replaced assets and annual equipment utilization. Estimated net ongoing
sustaining capital requirements for 2007 are expected to be in the range of
$12.0 million to $14.0 million. Sustaining capital purchases are funded from
the Partnership's net cash provided by operations in the year.

    Fuel Costs

    Fuel costs fluctuated during the current quarter with average
daily-posted rack prices for low-sulphur diesel fuel at refineries across
Canada ranging from $0.68 per litre to $0.81 per litre. Trimac has fuel
surcharge programs in place with substantially all of its customers and the
effect of changes in fuel prices has generally been neutral to its results in
past years.
    The bulk trucking industry and its customers have generally agreed to
monthly fuel surcharges, a practice which tends to create a shortfall in fuel
recoveries in periods of rising fuel prices and an over-recovery when fuel
prices decline. Fuel surcharges averaged approximately 13.5 percent of base
trucking revenue during the current year. The Partnership estimates it has
fully recovered fuel cost increases in the current year.

    Forward-Looking Statements

    This news release contains statements concerning the outlook for Trimac's
business and estimates for sustaining capital or other expectations, plans,
goals, objectives, assumptions, information or statements about future events,
conditions, results of operations or performance that may constitute
forward-looking statements or information under applicable securities
legislation. Words such as "may", "will", "should", "expect", "plan",
"anticipate", "believe", "estimate", "predict", and words and expressions of
similar import are intended to identify these forward-looking statements. Such
forward-looking statements or information are based on a number of
assumptions, which may prove to be incorrect. In addition to any other
assumptions identified in this news release, certain assumptions have been
made concerning the forward-looking information contained herein including,
among other things: Trimac will be successful in maintaining its customer
relationships and such customers will not materially reduce the volume of
business provided to Trimac; general economic conditions will not be
materially different in 2007 from those prevailing in the fourth quarter of
2006; Trimac will continue to attract and retain a sufficient number of
qualified drivers and mechanics; Trimac will continue to be successful in
recovering fuel price increases from its customers; adverse weather will not
unduly impact Trimac's operations; the Canadian dollar will not materially
strengthen against the United States dollar; distributions payable by Trimac
to its unitholders will not be subject to tax in 2007; there will be no
material changes to the laws and regulations applicable to Trimac or its
businesses; the seasonality of Trimac's business will be consistent with
historical trends; no irreparable damage will be done to Trimac's operating
systems and databases or information contained thereon; Trimac will maintain
or improve upon its competitive position within the bulk trucking sector;
adequate financing will be available to Trimac to fund capital expenditures,
working capital and distributions on terms and conditions favourable to
Trimac; Trimac will not have any judgment entered against it in a court of law
which would have a material adverse effect on Trimac or its businesses; Trimac
will continue to have all material licences and permits required by law to
conduct its businesses as presently conducted; there will not be a material
increase in the price of equipment required in the business of Trimac; and the
estimated useful life of equipment and the proceeds received on the
disposition thereof will be consistent with historical trends at Trimac.
    Although the Fund believes that the expectations reflected in such
forward-looking statements or information are reasonable, undue reliance
should not be placed on forward-looking statements because the Fund can give
no assurance that such expectations will prove to be correct. Forward-looking
statements or information are based on current expectations, estimates and
projections that involve a number of risks and uncertainties which could cause
actual results to differ materially from those anticipated by the Fund and
described in the forward-looking statements or information. These risks and
uncertainties include but are not limited to:

    
        -  General economic conditions - Certain product lines of Trimac are
           dependent on the general economic conditions of the regions in
           which it operates and cash flows may be negatively impacted by
           economic downturns in any particular region;
        -  Labour - Trimac's cash flow and growth are dependent on its
           ability to hire and retain quality drivers and mechanics;
        -  Fuel - Rising fuel prices and the ability of Trimac to recover
           cost increases in the marketplace may impact cash flow;
        -  Weather - Adverse weather may impact Trimac's transportation of
           goods and increase operating costs;
        -  Foreign currency exchange - The strengthening Canadian dollar may
           impact Trimac's customers' cost competitiveness and negatively
           impact the volume of goods transported;
        -  Tax structure - Changes in government regulation may negatively
           impact Trimac's distributable cash;
        -  Environmental considerations - Changes in environmental law may
           impact operating costs;
        -  Seasonality of business - Financial results may be impacted by the
           seasonality of the business;
        -  Information technology - Cash flow could be adversely affected by
           an event that caused irreparable damage to Trimac's operating
           systems and databases or information contained in the databases;
        -  Competitive conditions - There can be no assurance that Trimac
           will be able to compete successfully against its current or future
           competitors or that competition will not have a material adverse
           affect on its results of operations and financial condition; and
        -  Financing - No assurances can be made that financing will be
           available when required by business needs.
    

    The foregoing list of risks and uncertainties is not exhaustive.
Additional information on these and other factors which may affect Trimac's
operations or financial results and those of the Fund are included under the
heading "Risk Factors" in the Fund's current Annual Information Form and as
may be updated in the Fund's annual and interim Management's Discussion and
Analysis and Annual Information Form, which are or will be filed with
securities regulators. The Fund undertakes no obligation to update publicly or
otherwise revise any forward-looking statement, whether as a result of new
information, future events or otherwise.

    Trimac is Canada's largest provider of bulk trucking services, with
operations from coast to coast. In addition, through its wholly owned
subsidiary, BPL, Trimac provides third-party transportation logistics services
in Canada and the United States. Trust units of Trimac Income Fund are traded
on The Toronto Stock Exchange under the symbol TMA.UN

    You are invited to join us on a conference call at 10:00 a.m. Eastern
Time on Friday March 9, 2007. For North American participants, please dial
1-800-525-6384 or for international participants, please dial ++1 780-409-1668
at least 10 minutes prior to the start time of the call.
    A playback of the call will be available starting at 1:00 p.m. Eastern
Standard Time on Friday, March 9, 2007 until midnight March 16, 2007. To hear
the playback dial 1-800-766-3735 or for international participants, please
dial ++1 402-220-7735 and when prompted please enter the conference ID number
1312553.


    
    Trimac Income Fund
    Consolidated Balance Sheet
    -------------------------------------------------------------------------
    (thousands of dollars)


    As at December 31,                                     2006         2005
                                                     ------------------------
                                                              $            $
    Assets

    Current assets
    Cash                                                    223          137
    Interest receivable                                     237          238
    Distributions receivable                                949          632
    Due from Trimac Transportation Services Limited
     Partnership                                              -           33
    Prepaid expenses                                         75           29
                                                     ------------------------

                                                          1,484        1,069

    Investment in Trimac Transportation Services
     Limited Partnership                                 78,431       85,153
    Note receivable from Trimac Transportation
     Services Inc.                                       35,000       35,000
                                                     ------------------------

                                                        114,915      121,222
                                                     ------------------------
                                                     ------------------------

    Liabilities

    Current liabilities
    Accounts payable and accrued liabilities                236          187
    Due to associated companies and partnerships            310            -
    Distributions payable                                   966          913
                                                     ------------------------

                                                          1,512        1,100

    Unitholders' equity                                 113,403      120,122
                                                     ------------------------

                                                        114,915      121,222
                                                     ------------------------
                                                     ------------------------

    The Fund commenced business operations on February 25, 2005 and earnings
of the Fund's investment in Trimac have been accounted for using the equity
method of accounting since commencement. Under this method, the Fund's share
of earnings of Trimac, adjusted for the amortization of certain tangible and
intangible assets arising from the use of purchase accounting is reflected in
the statement of earnings of the Fund as "Share of earnings of Trimac
Transportation Services Limited Partnership". The results of operations of the
Fund are predominately dependent on the performance of the Partnership.



    Trimac Income Fund
    Consolidated Statement of Earnings and Unitholders' Equity
    -------------------------------------------------------------------------
    (thousands of dollars, except for numbers of units)

                                                                        From
                         Three months Three months               February 25
                             ended        ended      Year ended           to
                          December 31, December 31, December 31, December 31,
                                 2006         2005         2006         2005
                                    $            $            $            $
                           ------------------------  ------------------------
    Share of earnings of
     Trimac Transportation
     Services Limited
     Partnership(1)               659        1,102        3,150        2,268
      Interest income             707          706        2,803        2,378
      Administrative costs       (382)        (209)      (1,186)        (555)
                           ------------------------  ------------------------

      Net earnings for
       the period                 984        1,599        4,767        4,091

      Opening unitholders'
       equity                 115,317      121,263      120,122            -
      Issue of units
       through Initial
       Public Offering              -            -            -       85,986
      Issue of units on
       over-allotment
       option                       -            -            -        4,299
      Issue of units through
       private offering             -            -            -       35,000
      Distributions            (2,898)      (2,740)     (11,486)      (9,254)
                           ------------------------  ------------------------

      Closing unitholders'
       equity                 113,403      120,122      113,403      120,122
                           ------------------------  ------------------------
                           ------------------------  ------------------------

    Basic and diluted
     earnings per unit(2) $    0.0785  $    0.1276  $    0.3805  $    0.3265

      Weighted average number
       of units outstanding
       used in computing
       basic earnings
       per unit            12,528,515   12,528,515   12,528,515   12,528,515

      Weighted average number
       of units outstanding
       used in computing
       diluted earnings
       per unit(2)         23,306,366   22,767,238   23,306,366   22,767,238

    (1) The net earnings of the Partnership are allocated between TTSI and
        the Fund based on the terms of the partnership agreement. The
        following is a reconciliation of net earnings recorded in the
        consolidated financial statements of the Partnership to the amount
        recorded by the Fund.

                                                                 Period From
                         Three months Three months               February 25
                             ended        ended      Year ended           to
                          December 31, December 31, December 31, December 31,
                                 2006         2005         2006         2005
                                    $            $            $            $
                           ------------------------  ------------------------
    Net earnings of the
     Partnership                3,156        5,754       17,001       14,982
      Add: Interest expense
       on TTSI debt included
       in Partnership
       earnings                 1,029        1,030        4,085        3,477
                           ------------------------  ------------------------
    Adjusted Partnership
     earnings                   4,185        6,784       21,086       18,459
      Less: Purchase price
       allocation
       adjustments:
        Increase in
         amortization of
         capital assets        (1,468)        (530)      (3,066)      (1,776)
        Amortization of
         intangible assets     (1,010)      (3,086)      (9,572)     (10,282)
                           ------------------------  ------------------------
    Partnership earnings
     after purchase
     price adjustments          1,707        3,168        8,448        6,401
                           ------------------------  ------------------------
    Share of Partnership
     earnings                     659        1,102        3,150        2,268
                           ------------------------  ------------------------
                           ------------------------  ------------------------

    (2) Pursuant to an investor liquidity agreement, holders of TTSI
        Exchangeable Shares have the right to effectively liquidate their
        9,844,713 shares of TTSI and receive units in the Fund. Following the
        full exercise of such liquidation rights, the Fund would own 100
        percent of the Partnership. The number of units used in the
        calculation of diluted earnings per unit assumes full liquidation at
        the beginning of the period.



    Trimac Income Fund
    Consolidated Statement of Cash Flows
    -------------------------------------------------------------------------
    (thousands of dollars)

                                                                        From
                         Three months Three months               February 25
                             ended        ended      Year ended           to
                          December 31, December 31, December 31, December 31,
                                 2006         2005         2006         2005
                                    $            $            $            $
                           ------------------------  ------------------------
    Cash provided (used)

    Operations
    Net earnings                  984        1,599        4,767        4,091
    (Deduct) add items not
     affecting cash:
      Share of earnings from
       Trimac Transportation
       Services Limited
       Partnership               (659)      (1,102)      (3,150)      (2,268)
      Distributions from
       Trimac Transportation
       Services Limited
       Partnership                659        1,102        3,150        2,268
                           ------------------------  ------------------------

    Cash provided
     by operations                984        1,599        4,767        4,091
    Net change in non-cash
     working capital               49         (203)         347         (113)
                           ------------------------  ------------------------

    Net cash provided
     by operations              1,033        1,396        5,114        3,978
                           ------------------------  ------------------------

    Investments
    Investment in Trimac
     Transportation Services
     Limited Partnership            -            -            -      (90,285)
    Advance to Trimac
     Transportation
     Services Inc.                  -            -            -      (35,000)
    Distributions from
     Trimac Transportation
     Services Limited
     Partnership                1,994        1,126        6,405        4,500
                           ------------------------  ------------------------

    Cash provided by
     (used in) investing
     activities                 1,994        1,126        6,405     (120,785)
                           ------------------------  ------------------------

    Financing
    Proceeds on issue
     of units                       -            -            -      125,285
    Distributions paid         (2,897)      (2,740)     (11,433)      (8,341)
                           ------------------------  ------------------------

    Cash (used in) provided
     by financing activities   (2,897)      (2,740)     (11,433)     116,944
                           ------------------------  ------------------------

    Increase in cash              130         (218)          86          137
    Cash, beginning
     of period                     93          355          137            -
                           ------------------------  ------------------------

    Cash, end of period           223          137          223          137
                           ------------------------  ------------------------
                           ------------------------  ------------------------

    Supplemental information
    Cash received
     from interest                700          700        2,804        2,140

    The financial statements included in this news release do not contain the
notes to the statements. Financial statements with note disclosure are filed
with securities regulators.



    Trimac Transportation Services Limited Partnership
    Consolidated Balance Sheet
    -------------------------------------------------------------------------
    (thousands of dollars)

    As at December 31,                                     2006         2005
                                                     ------------------------
                                                              $            $

    Assets

    Current assets
    Cash and term deposits                                    -        6,747
    Accounts receivable                                  33,058       35,830
    Materials and supplies                                1,823        1,894
    Due from associated companies and partnerships        1,012          993
    Prepaid expenses                                      9,978        9,541
                                                     ------------------------

                                                         45,871       55,005

    Capital assets                                      105,163       91,858
    Intangible assets                                     1,093            -
    Goodwill                                              4,471        3,564
    Future income taxes                                       -          465
    Other                                                 1,287        1,217
                                                     ------------------------

                                                        157,885      152,109
                                                     ------------------------
                                                     ------------------------

    Liabilities

    Current liabilities
    Bank indebtedness                                       699            -
    Accounts payable and accrued liabilities             29,681       29,308
    Distributions payable                                 5,099        2,604
    Income taxes payable                                    540          276
    Due to associated companies                           3,138        3,043
                                                     ------------------------

                                                         39,157       35,231

    Long-term debt                                       58,260       56,000
    Future income taxes                                   1,830            -
    Other long-term liabilities                           1,574        1,228
                                                     ------------------------

                                                        100,821       92,459

    Partnership equity                                   57,064       59,650
                                                     ------------------------

                                                        157,885      152,109
                                                     ------------------------
                                                     ------------------------

    The Partnership provides bulk trucking services throughout Canada and
complementary logistics services in Canada and the United States. Effective
January 1, 2005, the Partnership purchased substantially all of the assets of
Trimac Transportation Services Inc. ("TTSI") relating to its Canadian bulk
trucking business and its North American logistics business. TTSI and certain
of its subsidiaries conducted the business operations of the Partnership prior
to January 1, 2005.



    Trimac Transportation Services Limited Partnership
    Consolidated Statement of Earnings and Equity
    -------------------------------------------------------------------------
    (thousands of dollars)

                                                           Period    Period
                   Three     Three                          from      from
                   months    months      Year      Year   February   January
                   ended     ended     ended     ended     25 to      1 to
                  December  December  December  December  December  February
                  31, 2006  31, 2005  31, 2006  31, 2005  31, 2005  24, 2005
                  ------------------- ---------------------------------------
                         $         $         $         $         $         $

    Transportation
     revenue        72,395    75,878   290,847   289,054   243,422    45,632
    Fuel surcharges  7,368     9,209    32,563    24,593    22,239     2,354
                  ------------------- ---------------------------------------
    Total revenues  79,763    85,087   323,410   313,647   265,661    47,986
                  ------------------- ---------------------------------------

    Operating costs
     and expenses
    Direct          56,969    61,715   235,654   230,102   193,912    36,190
    Selling and
     administrative 12,178    10,902    45,323    42,553    34,942     7,611
    Depreciation and
     amortization    6,113     5,605    22,146    22,501    18,809     3,692
    (Gain) loss on
     sale of
     assets (net)     (224)      (25)   (1,651)     (693)     (701)        8
                  ------------------- ---------------------------------------

    Operating
     expense        75,036    78,197   301,472   294,463   246,962    47,501
                  ------------------- ---------------------------------------

    Operating
     earnings        4,727     6,890    21,938    19,184    18,699       485

    Interest on
     long-term debt  1,094     1,128     4,262     3,780     3,740        40
    Other interest
     (income)
     expense           (71)        7      (245)       44        43         1
                  ------------------- ---------------------------------------
                     1,023     1,135     4,017     3,824     3,783        41
                  ------------------- ---------------------------------------

    Earnings before
     income taxes    3,704     5,755    17,921    15,360    14,916       444

    Income tax
     expense
     (recovery)
    Current            137       123       407       367       335        32
    Future             411      (122)      513      (421)     (401)      (20)
                  ------------------- ---------------------------------------
                       548         1       920       (54)      (66)       12
                  ------------------- ---------------------------------------

    Net earnings     3,156     5,754    17,001    15,414    14,982       432

    Opening equity  59,252    58,261    59,650    23,795    41,760    23,795
    Reorganization
     adjustments
     to equity           -         -         -    17,545         -    17,545
    Issue of
     additional
     partnership
     units               -         -         -    90,285    90,285         -
    Partnership
     unit issuance
     costs               -       (18)        -    (9,718)   (9,718)        -
    Partnership
     formation
     costs               -         -         -    (1,535)   (1,535)        -
    Return of
     capital to
     general partner     -         -         -    (5,509)   (5,509)        -
    Reclassification
     of equity
     to debt             -         -         -   (56,000)  (56,000)        -
    Cumulative
     translation
     adjustment
     change             41        (4)       11       (31)      (19)      (12)
    Distributions
     declared       (5,385)   (4,343)  (19,598)  (14,596)  (14,596)        -
                  ------------------- ---------------------------------------

    Closing
     partnership
     equity         57,064    59,650    57,064    59,650    59,650    41,760
                  ------------------- ---------------------------------------
                  ------------------- ---------------------------------------



    Trimac Transportation Services Limited Partnership
    Consolidated Statement of Cash Flows
    -------------------------------------------------------------------------
    (thousands of dollars)

                                                           Period    Period
                   Three     Three                          from      from
                   months    months      Year      Year   February   January
                   ended     ended     ended     ended     25 to      1 to
                  December  December  December  December  December  February
                  31, 2006  31, 2005  31, 2006  31, 2005  31, 2005  24, 2005
                  ------------------- ---------------------------------------
                         $         $         $         $         $         $
    Cash provided
     (used)

    Operations
    Net earnings     3,156     5,754    17,001    15,414    14,982       432
    Add back
     (deduct)
     items not
     affecting cash
      Depreciation
       and
       amortization  6,113     5,605    22,146    22,501    18,809     3,692
      (Gain) loss
       on sale of
       assets (net)   (224)      (25)   (1,651)     (693)     (701)        8
      Future income
       tax expense
       (recovery)      411      (122)      513      (421)     (401)      (20)
      Other non-cash
       items            31        28       276       204       204         -
                  ------------------- ---------------------------------------

    Cash provided
     by operations   9,487    11,240    38,285    37,005    32,893     4,112

    Net change in
     non-cash
     working capital 4,727     1,500     2,794       409     6,616    (6,207)
                  ------------------- ---------------------------------------

    Net cash
     provided by
     (used in)
     operations     14,214    12,740    41,079    37,414    39,509    (2,095)
                  ------------------- ---------------------------------------

    Investments
    Purchases of
     capital assets (5,314)   (2,378)  (30,244)  (16,978)  (11,012)   (5,966)
    Proceeds on
     sale of
     capital assets    533       234     4,032     2,474     2,191       283
    Acquisition of
     transportation
     assets         (8,171)   (2,714)   (8,171)   (2,714)   (2,714)        -
    Increase
     (decrease) in
     accounts payable
     and accrued
     liabilities
     relating to
     investing
     activities        (77)      183       787       183       183         -
    Increase in
     accounts
     receivable
     relating to
     investing
     activities      1,413         -       (64)        -         -         -
    Other               97        (2)      (22)       10       (19)       29
                  ------------------- ---------------------------------------

    Cash used in
     investing
     activities    (11,519)   (4,677)  (33,682)  (17,025)  (11,371)   (5,654)
                  ------------------- ---------------------------------------

    Financing
    Increase in
     long-term debt                      2,260         -         -         -
    Repayments of
     long-term debt      -         -         -   (75,000)  (75,000)        -
    Net proceeds on
     issue of units      -       (18)        -    79,032    79,032         -
    Return of
     capital             -         -         -    (5,509)   (5,509)        -
    Distributions
     paid           (4,398)   (4,054)  (17,103)  (11,992)  (11,992)        -
                  ------------------- ---------------------------------------

    Cash used in
     financing
     activities     (4,398)   (4,072)  (14,843)  (13,469)  (13,469)        -
                  ------------------- ---------------------------------------

    (Decrease)
     increase in
     cash and term
     deposits (bank
     indebtedness)  (1,703)    3,991    (7,446)    6,920    14,669    (7,749)
    Cash and term
     deposits (bank
     indebtedness),
     beginning of
     period         (1,256)    2,756     6,747      (173)   (7,922)     (173)
                  ------------------- ---------------------------------------

    (Bank
     indebtedness)
     cash and term
     deposits, end
     of period      (2,959)    6,747      (699)    6,747     6,747    (7,922)
                  ------------------- ---------------------------------------
                  ------------------- ---------------------------------------

    Supplemental
     Information
    Income
     taxes paid        (64)       87       143       149       144         5
    Interest paid        5       102     4,050     2,372     2,284        88
    

    The financial statements included in this news release do not contain the
notes to the statements. Financial statements with note disclosure are filed
with securities regulators.




For further information:

For further information: Terry J. Owen, President & Chief Executive
Officer, Trimac Transportation Services Inc., Telephone: (403) 298-5101,
Facsimile: (403) 298-5355; Edward V. Malysa, Vice President & Chief Financial
Officer, Trimac Transportation Services Inc., Telephone: (403) 298-5176,
Facsimile: (403) 298-5146; Investor Relations: investors@trimac.com

Organization Profile

Trimac Transportation Ltd.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890