BOLTON, Ont. – Titanium Transportation reported its second strongest first quarter for revenue, generating $44.3 million despite economic challenges late in the quarter wrought by the Covid-19 pandemic.

Net income of $600,000 was up slightly year-over-year. Truck transportation revenue was flat, while logistics generated a 49% increase y-o-y, thanks in part to the company’s expansion into the U.S. The U.S. operation contributed $4.7 million to the top line, the company said in an earnings call with analysts this morning.

It continues to plan the opening of a second U.S. location in Nashville, Tenn., by the end of the second quarter.

“Our technological investments have positioned Titanium as a leader in unwavering customer service in a complex, challenging economic environment,” president and CEO Ted Daniel said, noting the logistics division felt the greatest impact of the Covid-19-related economic slowdown.

He attributed the company’s diversification for its ability to weather the storm on the truck transportation side. Titanium has paid down debt and hoarded cash so it’s ready to move on any acquisition opportunities that emerge as companies struggle within the current economic backdrop.

“We remain engaged in this area,” Daniel said of M&A opportunities. The company has $2 million in cash and borrowing capacity of $11.1 million.

“We are looking for sellers that are looking for a solution given the current circumstances,” he said, “and that want to be a part of Titanium…We believe given the economic challenges there are going to be some trucking companies that are going to be struggling and we want to have cash for potential M&A. We are looking for companies that didn’t expect this (crisis), good companies, good people, that want to become a part of our more technologically-advanced organization.”

“We have a ton of dry powder sitting in the barn.”

Ted Daniel, Titanium Transportation

For this reason, Daniel said, “cash is king” and that most capital expenditures have been put on hold, aside from an order of 100 replacement trailers this year.

“We have a ton of dry powder sitting in the barn,” said Daniel, noting it will likely be used for acquisitions. “We are only going to replace equipment on an as-necessary basis.”

Marilyn Daniel, chief operating officer, said the company has been able to keep its equipment busy thanks to its diversified customer base. While Q2 will see a greater effect on freight volumes, she wouldn’t put a number on the potential impact.

“We definitely see reductions and are trudging through, shuffling around some of the equipment in our fleet,” she said. “We’re very fortunate with our diversification that we’re able to keep most of our fleet busy.”

Ted Daniel assured Titanium has ample liquidity to “weather the economic situation.”

“Our results were excellent given the current economic backdrop,” he concluded. “A heartfelt thank you to our team who stepped up to maintain uninterrupted service to our valued customers, many of whom are involved in essential supplies. When Covid-19 began to affect our end markets, we at Titanium took swift action to ensure the safety and wellbeing of our workforce, our customers and our communities at large. We remain vigilant as we continue to service the essential supply chain.”