MONTREAL, Que. — The TransForce Income Fund announced results for the second quarter that demonstrate both the benefits of its acquisition strategy and the challenging environment faced by its existing operations.
The fund increased revenues by 9% to $495.7 million, from $455.6 million in the second quarter of 2006. EBITDA (earnings before interest, taxes, depreciation and amortization and equivalent to operating income on TransForce’s financial statements) increased by 4% to $64.1 million in the quarter, from $61.6 million in the same period last year.
“We increased revenue and EBITDA through strategic acquisitions made in the past year as we continued to pursue opportunities to acquire good companies that will help TransForce create long-term value for unitholders,” said Alain Bdard, chairman, president and CEO of the fund. “Overall, our existing operations have had to adjust to weaker market conditions, particularly in the truckload segment due to weaker demand and in oilfield services which were affected by lower drilling activity in Western Canada.”
During the quarter, TransForce acquired three companies that provide clients with vehicles and drivers; and formed them into a new Fleet Management and Personnel Services division, which is now part of the Specialized Services segment.
“The companies that we acquired in the second quarter meet our criteria in having solid track records and management teams. They complement the other businesses in the TransForce group of companies but are not as asset-intensive and we expect them to generate higher-than-average returns for unitholders,” said Bdard.
Subsequent to the end of the second quarter TransForce announced the signing of a letter of intent to acquire all the issued and outstanding shares of Century II Holdings whose wholly owned subsidiary, operating as ICS Courier, operates a fixed route courier business that services more than 35,000 accounts. ICS Courier is based in Toronto and had revenues of approximately $90 million in 2006.
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