• ITVI.USA
    17,113.070
    186.890
    1.1%
  • OTRI.USA
    28.200
    0.000
    0%
  • OTVI.USA
    17,079.400
    184.170
    1.1%
  • TLT.USA
    3.090
    0.190
    6.6%
  • TSTOPVRPM.ATLPHL
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    0.060
    2.3%
  • TSTOPVRPM.CHIATL
    3.080
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  • TSTOPVRPM.DALLAX
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  • TSTOPVRPM.LAXDAL
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  • TSTOPVRPM.PHLCHI
    1.630
    -0.090
    -5.2%
  • TSTOPVRPM.LAXSEA
    3.360
    0.070
    2.1%
  • WAIT.USA
    121.000
    1.000
    0.8%
  • ITVI.USA
    17,113.070
    186.890
    1.1%
  • OTRI.USA
    28.200
    0.000
    0%
  • OTVI.USA
    17,079.400
    184.170
    1.1%
  • TLT.USA
    3.090
    0.190
    6.6%
  • TSTOPVRPM.ATLPHL
    2.630
    0.060
    2.3%
  • TSTOPVRPM.CHIATL
    3.080
    -0.090
    -2.8%
  • TSTOPVRPM.DALLAX
    1.180
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  • TSTOPVRPM.LAXDAL
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  • TSTOPVRPM.PHLCHI
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CanadaInternationalNewsTrucking

Canadian trucking CEO: Many companies want to sell

Murray Mullen of Mullen Group points to abundance of acquisition opportunities, hinting at wider industry struggles

The CEO of Mullen Group (TSE:MTL) said the Canadian trucking and logistics company is currently “inundated with acquisition opportunities” as other firms look to sell during the economic turmoil of the COVID-19 pandemic.

“I ask myself, ‘Why are so many companies all of a sudden on the block?’” Murray Mullen told financial analysts during a conference call on Thursday. “My instincts are telling me that 2021 is going to be a great year of opportunity, especially as government support payments start to run out. Then it’s back to basics. And you better have a good business model like we do.”

Mullen made the comments while discussing Alberta-based Mullen Group’s third-quarter financial results. While the company is well positioned to emerge from the pandemic stronger — with millions of dollars of cash and a small debt load — the pandemic still weighed on its performance. 

Mullen had net income of C$26.2 million, or 26 cents per share, on C$290.9 million revenue during the quarter. Net income increased by 27.8% while revenue dropped 10.6% compared a year earlier. 

The increase in profits came in large part from over C$10 million from the Canadian government via the Canada Emergency Wage Subsidy (CEWS) program to Mullen’s subsidiaries, concentrated in western Canada. Without them, Mullen would have been slightly lower compared to a year ago.

As Mullen noted during the call, the company didn’t need the subsidies, but they allowed its subsidiaries to retain more employees than otherwise.  

Few Canadian trucking failures – so far

Canada hasn’t seen a large wave of trucking failures during the pandemic even as carriers — especially those hauling auto parts and industrial equipment — struggled. The combination of CEWS and other government aid to the companies themselves, businesses and consumers has helped keep them afloat. 

The government aid has been targeted, by design, to minimize shoring up businesses that already were struggling for other reasons. Case in point: The two small trucking companies in Manitoba that were forced into receivership by Toronto-Dominion Bank owed C$2.2 million. 

Mullen, for its part, has been conserative on acquisitions in 2020. It acquired the remaining shares of Pacific Coast Express Ltd., a carrier in British Columbia, and it has an agreement to acquire International Warehousing and Distribution near Toronto. 

“It should be pretty obvious that cash of C$100 million-plus and an untapped line of credit provides a lot of dry powder. But you should all know me by now: I do not chase growth for the sake of growth,” Mullen said.

Click for more FreightWaves articles by Nate Tabak

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Nate Tabak, Border and North America Correspondent

Nate Tabak is a Toronto-based journalist who covers cross-border trucking, logistics and trade for FreightWaves. Before moving to Canada, he spent seven years reporting stories in the Balkans and Eastern Europe as a reporter, producer and editor based in Kosovo. He previously worked at newspapers in the San Francisco Bay Area, including the San Jose Mercury News. He graduated from UC Berkeley, where he studied the history of American policing. Contact Nate at ntabak@freightwaves.com.

One Comment

  1. Many of these trucking companies did not need gov money. No trucking companies should have got a wage subsidy for truck drivers and mechanics with a limit of $10,000 per company in wage subsidy per company. Government needs to limit aid to insurance and plates and permits costs for the trucks that are sitting or useage greatly reduced. The wage subsidies should apply instead to all bus and wheelchair vans upto 75 percent of the first 26 dollars per hour. It is not right that a company getting gov money can buy out another company or more equipment in the same year.

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