MONTREAL, Que. — TransForce grew Q2 revenue and profits thanks to last year’s acquisitions, but has revised downwards its anticipated full-year results on softer than expected economic conditions.
Revenue excluding fuel surcharges was $998.1 million, up 27% from the second quarter of 2014. Net income was $64.1 million compared to $37.3 million during the same period last year. Six-month net income ending June 30 totaled $78.2 million, up from $43.2 million for the same period last year.
“TransForce delivered solid operating results driven by the contribution from last year’s selective acquisitions,” said chairman, president and CEO Alain Bedard. “This strategy more than offset the impact of a weaker economy on business volumes and of lower oil prices which affected both our truckload divisions servicing the oil and gas industry and our US-based rig moving activities.”
Looking ahead, Bedard predicted a weak Canadian economy could constrain organic growth.
“We expect organic growth to be restrained in TransForce’s main operating markets due to the North American economy which is more sluggish than initially anticipated,” said Bedard. “Although the US economy is relatively healthy, lower oil prices have led to an economic contraction in Canada, a situation which threatens to persist through 2015. This will likely more than offset the momentum in Central Canada’s manufacturing sector, resulting from the benefits of a weaker Canadian dollar.”
He reduced TransForce’s full year earnings expectations to $4.3 billion in total revenue, down from previous projections of $4.4 to $4.5 billion.