Trimac Delivers Improved Earnings On Lower Revenue

CALGARY, Aug. 11, 2015 /CNW/ - 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 and six months ended June 30, 2015 ("current quarter" and "current year") compared with the three and six months ended June 30, 2014 ("comparative quarter" and "prior year").

Despite reduced revenue in the western Canadian provinces due to lower economic activity resulting from low oil and gas prices, Trimac has made significant inroads from the execution of their strategic plan that commenced in 2014.  Implementation of the operational excellence strategy has resulted in lower administration costs, reduced capital expenditures and operating efficiencies despite lower revenue.  Management estimates that Trimac is 30~50% through the process of implementing operational excellence and that the majority of the remaining initiatives will be implemented over the next 18 months.  Management will continue to focus on opportunities in capital discipline and administrative streamlining.

Highlights for the second quarter:

  • Despite lower revenue due to less economic activity, earnings before tax increased 7.0% over the comparative quarter
  • Selling and administrative costs decreased 7.8% over the comparative quarter
  • Capital expenditures decreased $5.1 million over the comparative quarter
  • Revenue before fuel surcharges decreased 2.4% percent (or $2.3 million), adjusted EBITDA decreased $0.4 million and earnings before income tax increased $0.3 million for the current quarter
  • Revenue decreases were primarily in western Canada in the bulk trucking segment
  • Revenue with existing commercial customers resulted in year over year growth in the National Tank Services segment
  • Bulk Plus Logistics experienced higher revenue in the transload operations, however, these gains were offset by lower volumes in the freight management operations, primarily due to the market conditions in western Canada
  • The decrease in adjusted EBITDA was mainly attributable to the lower revenue volumes while the increase in earnings before income tax was the result of lower depreciation expense due to lower capital expenditures incurred in the current quarter 

Selected Financial Highlights





Three months ended June 30

Six months ended June 30

(in millions of dollars, except per share data)

2015

2014

Variance

2015

2014

Variance

Financial Results











Revenue:











Bulk Trucking revenue before fuel surcharges

81.9

85.2

-3.9%

165.1

171.9

-4.0%


National Tank Services third party revenue

5.7

4.6

23.9%

11.3

8.7

29.9%


Bulk Plus Logistics



5.0

5.1

-2.0%

10.0

10.2

-2.0%






92.6

94.9

-2.4%

186.4

190.8

-2.3%


EBITDA:











Bulk Trucking



8.7

9.7

-10.3%

15.8

18.8

-16.0%


National Tank Services



1.3

0.9

44.4%

2.4

1.8

33.3%


Bulk Plus Logistics



1.1

0.9

22.2%

2.1

1.7

23.5%






11.1

11.5

-3.5%

20.3

22.3

-9.0%


Earnings before income tax expense:









Bulk Trucking



3.0

3.2

-6.3%

4.2

5.5

-23.6%


National Tank Services



0.7

0.4

75.0%

1.3

0.8

62.5%


Bulk Plus Logistics



0.9

0.7

28.6%

1.8

1.4

28.6%






4.6

4.3

7.0%

7.3

7.7

-5.2%


Share Information: 










Cash dividends declared per share


0.07

0.07


0.14

0.14



Earnings per share (basic)


0.12

0.11


0.21

0.22



Earnings per share adjusted


0.12

0.12


0.21

0.22














Other Information:










Net property, plant and equipment additions

2.4

7.5


3.8

14.3



Ed Malysa, President and COO commented "Despite lower revenue in our western Canadian operations, we are very pleased that the execution of our operational excellence strategy is starting to generate positive results with a year-over-year increase in net income and earnings per share in the current quarter."

Outlook

The low oil prices not only impacted the oil and gas industry, but had a trickle down negative impact on many of the industries we serve.  Although the Canadian economy was less robust than expected, our customers are not anticipating real growth for the remainder of the year and we anticipate more of the same volatility in revenue for the balance of the year.  Through these challenging conditions, we will continue to focus on our operational excellence strategy by having tight cost controls, rationalizing capital expenditures and improving asset utility wherever possible.  Trimac continues to maintain a strong balance sheet and the current low debt levels will allow us to take advantage of revenue growth opportunities that may require new capital or opportunistic acquisitions that match our strategic growth objective of delivering value for our shareholders.

Declaration of Quarterly Dividend

The Board of Directors today, August 11, 2015, declared a dividend of $0.07 per common share, payable on October 15, 2015 to shareholders of record at the close of business on September 30, 2015.

Forward-Looking Statements

Certain information included in this news release constitutes "forward-looking statements".  Trimac cautions that, by their nature, these forward-looking statements are based on suppositions, risks, and uncertainties as well as on management's best possible evaluation of future events. Trimac cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Such forward-looking statements are not guarantees of future performance and the actual results or performance of Trimac or the transportation industry may be materially different from the outlook or any future results or performance implied by such statements.  Please see "Forward-Looking Statements" in Trimac's MD&A for the three and six months ended June 30, 2015 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.

Non-GAAP Financial Measure

EBITDA and adjusted earnings per share are financial measures not prescribed by IFRS and may not be comparable to similar measures presented by other issuers.  Management considers these non-GAAP measures useful in evaluating the performance of Trimac's operations.  These measures should be considered in addition to, not a substitute for, the financial performance measures prepared in accordance with IFRS.

Profile

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

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

You are invited to join us on a conference call at 11:00 a.m. Eastern Time on Wednesday, August 12th, 2015.  To join the call, please dial 1-866-696-5910 and enter pass code 3768026 at least 10 minutes prior to the start time of the call.  An audio playback of the call will be available starting Thursday, August 13th, 2015 on our website at http://www.trimac.com/page/eventscalendar.

SOURCE Trimac Transportation Ltd.

For further information: Edward V. Malysa, President & Chief Operating Officer, Trimac Transportation Ltd., Telephone: 403-298-5100, Facsimile: 403-298-5146; Scott D. Calver, Vice President & Chief Financial Officer, Trimac Transportation Ltd., Telephone: 403-298-5100, Facsimile: 403-298-5146

RELATED LINKS
http://www.trimac.com

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