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COMPETITION WATCH: Trimac first quarter dips slightly from 2006

CALGARY, Alta. -- Trimac Income Fund released the financial results of the fund and Trimac Transportation Services ...

CALGARY, Alta. — Trimac Income Fund released the financial results of the fund and Trimac Transportation Services for the first quarter of 2007, which dipped slightly from first quarter results in 2006.

Unaudited revenues for the first quarter in 2007 totaled $79.1 million, while in 2006 Trimacs revenues totaled $80.6 million.

Strong revenue growth in the prairie provinces of 11.4% was offset by a sharp decline in woodchip revenue, the majority of which occurred after the first quarter of 2006. Bulk Plus Logistics (BPL) revenue increased modestly; however, profitability was negatively impacted by the CN Rail labour disruption, lower revenue in the US transload operations, and a customer product contamination claim.

“In the quarter, our western division was impacted by severe weather and continued volatility in the division’s woodchip operations. This contrasted dramatically with the first quarter of 2006 in which we enjoyed extremely favourable weather and significantly higher oil and natural gas drilling activity, commented Terry Owen, president and CEO of Trimac.

The western division generated $44.1 million in revenue in the current period, a decrease of $1.3 million from $45.4 million recorded in the prior period. The eastern division’s revenue decreased from $30.8 million in the prior period to $29.9 million in the current period, a decrease of $0.9 million. A short-term contract that contributed revenue of $2.6 million in the current period and the $1.0 million of revenue generated from the JBE acquisition mostly offset revenue declines associated with plant closures and business losses that occurred in 2006 in the cement, dry bulk, plastics, and chemical product lines.

Trimac continued to execute its acquisition strategy with the purchase of Ken Angeli Trucking (KAT) on April 30, for approximately $1.8 million. KAT is engaged in the hauling of chemical products with operations in Kamloops, B.C. and Edmonton. KAT operates a fleet of 10 power units and 15 trailers with annual revenues in the last completed fiscal year of approximately $3 million.

“As management looks ahead to the remainder of 2007, we expect favourable economic activity levels in B.C. and the prairie provinces, offset by continued volatility in the woodchip operations and reduced oil and natural gas industry-related drilling activity compared to 2006, stated Owen. In the eastern division, management believes the reduced level of manufacturing activity and modest economic growth in central Canada will continue, resulting in a more competitive operating environment.

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