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Mullen Group Ltd. reported record revenue but saw profits decline in the third quarter.
The Okotoks, Alberta-based company said Q3 net income fell 33.2% to C$17.5 million compared with C$26.2 million in the same quarter of 2020. Diluted earnings per share fell to 19 Canadian cents from 26 cents.
Revenue rose 48.7% to a record C$432.5 million compared with C$290.9 million in the third quarter of last year.
CEO Murray Mullen attributed much of the revenue gain to a series of acquisitions the motor carrier has made in the past year. They include Naperville, Ill.-based QuadExpress, as well as Tri Point Intermodal Services and APPS Transport Group, both based in Mississauga, Ontario.
“Not only have these quality companies contributed to our revenue growth, they operate in sectors of the economy that we view as having the best potential for growth,” Mullen said in an Oct. 27 news release.
RELATED: Mullen ramps up acquisitions
“The economy is driven by consumer spending, but in today’s economy the trend has never been more evident, which is precisely why we have invested significant capital to acquire companies that provide logistics solutions to this sector of the economy,” he said.
Mullen, however, said the motor carrier’s results still are being held back by COVID-19-mandated workplace restrictions in Canada and “underinvestment in capital spending” there.
“This was one of the primary reasons our flat-deck transport business along with the majority of our specialized and industrial services business was down again this quarter,” he said.
Revenue in Mullen’s specialized and industrial services segment fell 7.3% to C$85.7 million because of reduced pipeline construction. The segment’s operating income before depreciation and amortization, an important measure of operating profit, fell by 26.4% to C$15.6 million.
Mullen’s other business units logged gains.
In this episode, host Michael Freeze asks, how are companies saving money by leasing trucks rather than owning? For answers, we speak with Jim Lager of Penske Truck Leasing and Al Barner of strategic fleet solutions at Fleet Advantage. Hear a snippet above, and get the full program by going to RoadSigns.TTNews.com.
Revenue for its less-than-truckload segment rose 50% to C$169.1 million, as it was a prime beneficiary of increased consumer spending. Its measure of operating profit rose 30% to C$26.9 million.
Logistics and warehousing revenue rose 41.4% to C$121.9 million. Mullen attributed the gain to greater demand for freight services. Its operating profit measure rose 47.4% to C$22.7 million.
The company’s new U.S. and international logistics segment added C$57 million in revenue and $2.9 million in operating profit. This was the first reporting period for this segment.
Mullen said revenue was above expectations due to the strong U.S. freight market.
The company’s consolidated operating income before depreciation and amortization rose by 17.3% to C$64.4 million.
Mullen Group ranks No. 60 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
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