OKOTOKS, Alta. -- Mullen Group’s second quarter net income rose 13% to $20.9 million this year, once adjusted for any unrealized foreign exchange gains and losses and the change in fair value of investments.
OKOTOKS, Alta. — Mullen Group’s second quarter net income rose 13% to $20.9 million this year, once adjusted for any unrealized foreign exchange gains and losses and the change in fair value of investments.
Mullen’s Q2 revenue was $310.3 million, a decrease of 3.1% year-over-year.
“Overall we are pleased with Mullen Group’s operating performance for the quarter considering economic fundamentals that are indicative of a no growth or, at best, a slow growth economy,” said Stephen Lockwood, president and co-CEO. “In terms of revenue from our core business, we were down marginally due to the decrease in demand for our services tied to drilling activity that experienced a slowdown in western Canada, which in part was the result of unfavourable weather conditions. Revenue also declined as a result of the completion of the TFT barge system project that was completed in the second quarter of last year. However, offsetting these two factors was the continued demand for our Premay Pipeline Hauling L.P. services, which are directly tied to the build out of new pipeline takeaway capacity in Canada, in addition to the increased revenue generated by Heavy Crude Hauling L.P. as a result of it being awarded a major crude oil and fluid hauling contract in the Lloydminster region. Even more satisfying is the 5.5% increase in operating income Mullen Group recorded in the quarter compared to last year despite a decrease in revenue.”
The company announced it has approved a further $20 million in capital spending this year, bringing its approved capital budget to $100 million.
The money will primarily be used to purchase specialized equipment for the oilfield services segment, as well as businesses involved in transporting production-related fluids.
“This is a very difficult market to read, a real dilemma when trying to determine the appropriate level of capital to deploy,” said Murray Mullen, chairman and CEO. “Entering 2013 we took a very measured approach to capital allocation given the prospects for the overall economy as well as the oil and natural gas industry. Today, however, we are of the view that the foundation is set for a rebound in oil and natural gas activity levels. Crude oil pricing remains strong accompanied by significant optimism related to the export of natural gas from western Canada through the west coast. Increasing our capital budget by $20 million this year will ensure our operating entities can meet the expected increase in demand for services and ensure our people have access to the very best operating equipment.”
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