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Mullen Group reported a gain in revenue but saw earnings dip in the second quarter.
The Okotoks, Alberta-based company said Q2 net income fell 5.7% to C$21.7 million compared with C$23 million in the same quarter of 2020. Its diluted earnings per share were unchanged at 23 Canadian cents. Revenue rose 21.4% to C$312.5 million compared with C$257.5 million in the second quarter of last year.
“June was the first full month in quite some time that freight demand was strong across virtually all business lines. Consumer demand, which has been one of the steadiest segments of the economy, continued at a robust pace throughout the quarter,” CEO Murray Mullen said in a July 21 news release.
The increasing freight demand across so many segments of the economy signaled “a more positive outlook for business investment and capital deployment,” Mullen said.
The company believes the economic environment is ripe for acquisitions and completed deals for five trucking firms during the quarter.
“Collectively, these businesses will add incremental annualized revenue in excess of C$400 million, putting us well ahead of our long-term plans to achieve C$2 billion in revenue per year, along with ensuring we maintain our position as one of the largest and most respected logistics providers in North America,” Mullen said.
The acquisitions included R.S. Harris Transport, QuadExpress, APPS Cartage Inc., APPS Cargo Terminals Inc. and Tri Point.
Mullen Group ranks No. 60 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
Two of Mullen’s three business segments logged gains during the quarter. Delays in pipeline construction projects are hurting its operations in Canada’s oil patch.
Revenue for its less-than-truckload segment rose 24.3% to C$126.7 million, helped by strong consumer spending compared to the same period in the prior year. Revenue also increased following the acquisition of Pacific Coast Express Limited.
The logistics and warehousing segment’s revenue rose 45.7% to C$120.6 million. Much of the increase came from a loosening of pandemic-related government restrictions that increased freight demand.
But revenue in Mullen’s specialized and industrial services segment fell 9.7% to C$66.4 million because of reduced pipeline construction.
Consolidated operating income before depreciation and amortization, an important measure of operating profit, followed a similar pattern. It rose by 14.6% to C$23.5 million in the LTL segment. The logistics and warehousing segment logged a 36% gain to C$23.8 for the quarter. But OIBDA fell 23.7% to C$15.1 million in the specialized and industrial services segment.
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