News Column

TransForce Announces 2014 First Quarter Results

April 24, 2014

Total revenue of $770.5 million, compared with $749.7 million last yearAdjusted EPS of $0.20 per share, versus $0.26 per share a year agoSolid free cash flow generation of $35.1 million mainly affected to share repurchase

MONTREAL, April 24, 2014 /CNW Telbec/ - TransForce Inc. (TSX: TFI) (OTCQX: TFIFF), a North American leader in the transportation and logistics industry, today announced its results for the first quarter ended March 31, 2014.

"TransForce's first-quarter results were affected by more severe winter weather this year compared to last. This factor and persistent softness in certain key sectors of the North American economy explain most of the EBIT decline in the Package and Courier ("P&C") and Less-than-Truckload ("LTL") segments, which overshadowed another solid performance from our Waste Management operations. Notwithstanding challenging market conditions, we continued to further optimize asset utilization and operating efficiency. This ongoing focus, and proceeds from the disposition of assets from rig moving operations that were previously shut down, produced a solid free cash flow of more than $35 million that was mainly used to repurchase our shares," said Alain BÉdard, Chairman, President and Chief Executive Officer of TransForce.

Financial highlightsQuarters ended March 31,
(in millions of dollars, except per share data)2014   2013
Total revenue 770.5   749.7
Revenue excluding fuel surcharge 679.8   671.0
Income from operating activities (EBIT1) 33.2   44.6
Free cash flow235.1   20.5
Adjusted net income319.9   24.4
  Per share - diluted ($) 0.20   0.26
Net income 5.9   18.9
  Per share - diluted ($) 0.06   0.20
Weighted average shares outstanding ('000s) 96,025   92,842
1Earnings before finance income and costs and income taxes.
2Net cash from operating activities less additions to property and equipment plus proceeds from sale of property and equipment and assets held for sale.
3Excluding the after-tax effect of changes in the fair value of derivatives andnet foreign exchange gain or loss.


Total revenue increased $20.8 million, or 2.8%, to $770.5 million mostly reflecting a contributionof $44.1 million fromthe acquisition of Clarke Transport and Clarke Road Transport on January 1, 2014. Excluding acquisitions, revenue declined due to lower volume and a planned reduction in rig moving activities across North America. These factors were partially offset by the effect of the U.S. currency appreciation on U.S.-dollar denominated sales, mainly in the P&C sector.

As a result of more severe winter weather this year compared to last and, to a lesser extent, lower gains on the sale of assets, EBIT amounted to $33.2 million, or 4.3% of total revenue, in the first quarter of 2014, versus $44.6 million, or 5.9% of total revenue, in the corresponding period a year earlier.

Adjusted net income, which excludes the after-tax effect of changes in the fair value of derivatives and net of foreign exchange gain or loss, was $19.9 million, or $0.20 per share, fully diluted, compared with $24.4 million last year, or $0.26 per share, fully diluted. Net income for the period stood at $5.9 million, or $0.06 per share, fully diluted, versus $18.9 million, or $0.20 per share, fully diluted, in the first quarter of 2013.

TransForce generated a solid free cash flow of $35.1 million, up from $20.5 million last year. The increase is mainly due to proceeds from the sale of assets amounting to $32.8 million and to a reduction in income tax paid during the first quarter of 2014, compared with last year. This free cash flow was mainly used to repurchase $25.9 million in common shares during the quarter.  


(in millions of dollars)Quarters ended March 31,
  2014 2013
  $   $  
Total revenue        
  Package and Courier 306.6   304.1  
  Less-Than-Truckload 179.4   148.9  
  Truckload 151.6   141.0  
  Specialized Services - Energy 78.7   91.9  
  Specialized Services - Others 69.8   76.8  
  Eliminations (15.6)   (13.1)  
Total 770.5   749.7  
  $% of Rev. $ % of Rev.
Income from operating activities (EBIT)        
  Package and Courier 12.94.2 17.2 5.7
  Less-Than-Truckload 4.02.3 12.1 8.1
  Truckload 6.04.0 6.5 4.6
  Specialized Services - Energy 4.35.5 3.3 3.6
  Specialized Services - Others 11.015.7 10.4 13.5
  Corporate (5.1)   (5.0)  
Total 33.24.3 44.6 5.9
Note: due to rounding, totals may differ slightly from the sum of individual segmented revenue or EBIT.


At the initiative of the Board of Directors (the « Board »), TransForce adopted a Dividend Policy (the « Policy ») whereby approximately 20-25% of TransForce's annualized free cash flow available would be distributed every year as dividends to shareholders. The Board has determined that this level of distribution would allow TransForce to maintain sufficient financial resources and flexibility to execute its operating and disciplined acquisition strategies, while providing an adequate return on shareholder's capital. The quarterly dividend payment is currently $0.145 per share.

If the dividend payable for a quarter is not within the aforementioned range, it is the Board's duty to determine whether the dividend should remain unchanged or if it should, accordingly, be adjusted upwards or downwards on a going forward basis. The Board may also, at its discretion and at any time, change the rate of dividends distributed and/or not to distribute a dividend, whether as a result of a one-time decision or a change in the Policy.

This Policy is in compliance with articles 42, 43 and 45 of the Canada Business Corporations Act. As per TransForce's credit agreement, the payment of a dividend is also subject to certain terms and covenants, including respecting certain financial ratios. As at March 31, 2014, all required ratios were satisfied.


"Although business conditions remain challenging due to a weak economy, we are encouraged by certain signs of firmer pricing in the LTL and Truckload segments. We are also making steady progress in regards to improving the efficiency of our P&C and LTL networks. Still, we must continue to adapt supply to demand by optimizing our asset base. In this regard, we closed four additional rig moving terminals in the U.S. and put these assets up for sale. Going forward, we will also focus on unlocking synergies from the Clarke and Vitran acquisitions, while maximizing return on assets in all segments.Achieving optimal efficiency will further drive cash flow generation, which we will use to reimburse long-term debt, repurchase shares and carry out our disciplined acquisition strategy. We are committed to creating sustainable value for our shareholders and this guiding principle remains the main driver in executing our operating strategy," concluded Mr. BÉdard.


TransForce will hold a conference call for analysts and portfolio managers on Friday, April 25, 2014 at 9:00 a.m. Eastern Time, to discuss these results. Business media are also invited to listen to the call. Interested parties can join the call by dialling 1-888-231-8191. A recording of the call will be available until midnight, May 2, 2014, by dialling 1-855-859-2056 or 416-849-0833 and entering passcode 17779792.


TransForce Inc. is a North American leader in the transportation and logistics industry operating across Canada and the United States through its subsidiaries. TransForce creates value for shareholders by identifying strategic acquisitions and managing a growing network of wholly-owned, operating subsidiaries. Under the TransForce umbrella, companies benefit from corporate financial and operational resources to build their businesses and increase their efficiency. TransForce companies service the following segments:

• Package and Courier; • Less-Than-Truckload; • Truckload, which includes specialized truckload and dedicated services; • Specialized Services, which includes waste management, logistics services and services to the energy sector.

TransForce Inc. is publicly traded on the Toronto Stock Exchange (TSX: TFI) and the OTCQX marketplace in the U.S. (OTCQX: TFIFF). For more information, visit


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.


EBIT, adjusted net income, adjusted earnings per share and free cash flow are financial measures not prescribed by IFRS and are not likely to be comparable to similar measures presented by other issuers. Management considers these to be useful information to assist investors in evaluating the Company's profitability, liquidity and ability to generate funds to finance its operations. These measures do not have any standardize meaning under IFRS and could be calculated differently by other companies. These measures should be considered in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with IFRS.

Note to readers: Consolidated financial statements and Management's Discussion & Analysis are available on TransForce's website at


SOURCE TransForce Inc.

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Source: Canada Newswire