Canadian trucking and logistics company Mullen Group (TSE:MTL) reported a nearly 28% increase in profits in its third-quarter financial results on Wednesday as government wage subsidies offset the continued drag from COVID-19, which pushed down revenue by over 10%.
Alberta-based Mullen had net income of C$26.2 million, or 26 cents per share, on C$290.9 million revenue. Net income increased by 27.8% while revenue dropped 10.6% compared a year earlier.
The increase in profits appears to have come in a large part from C$10.3 million from the Canadian government via the Canada Emergency Wage Subsidy program.
CEO Murray Mullen acknowledged the continued headwinds but characterized the results as “another solid quarter.” He pointed to continued — albeit uneven — strength in consumer spending.
“We continue to see a resurgence in economic activity driven thus far by a very resilient and ever demanding consumer,” Mullen said in a statement.
Mullen’s less-than-truckload business continues to be the company’s most resilient and largest segment, generating C$112.7 million in revenue during the quarter. But even the consumer-heavy LTL couldn’t escape the drag of the pandemic, with revenue dropping by 2.8% compared to a year ago.
LTL performed markedly better than Mullen’s logistics and warehousing segment. Revenue dropped by 12.8% to C$86.2 million. The company said the closure of business and project cancellations weighed on the segment.
The company’s specialized and industrial services segment, which includes considerable exposure to the Western Canada energy sector, continued to be Mullen’s weakest link. Revenue declined by 17.1% to C$92.4 million.
Murray Mullen will discuss the financial results during a conference call Thursday.