WOODSTOCK — Contrans Income Fund improved its third quarter revenues in 2007 by $7.7 million over the company’s third quarter results in 2006.
Acquisitions generated the majority of additional revenues from transportation services of $13.6 million in the third quarter of 2007 compared to the same period in 2006. Acquisitions also added $1.2 million to expenses during the quarter.
“I have always maintained that the inherent value of Contrans is more apparent in tougher times than in good times,” stated Stan Duford, chairman and CEO. “For over a year, we have been living in tougher times in Central and Eastern Canada. The strengthening Canadian dollar has dampened manufacturing activity and is affecting north-south trade and traffic. Construction activity has slowed down. These factors have affected everyone in our industry, some far more than others.”
The company worked to secure new customers to offset some of the adverse effects on revenue of the strong Canadian dollar, reduced manufacturing and construction activity and increased competition.
Lower average fuel prices caused revenue from fuel surcharges to decrease in 2007 compared to 2006.
Contrans’ operating expenses, as a percentage of revenue, improved in the third quarter of 2007 compared to the third quarter of 2006. This was primarily due to a reduction in empty mile percentage, most notably in the fund’s van operations, lower claims expenses and the impact of the Fund’s LTL operation acquired in the fourth quarter of 2006. This acquisition has lower operating costs but higher selling, general and administration expenses as a percentage of revenue compared to the fund’s other operations.
“Our continued success through the current challenging environment has been no accident,” explained Dunford. “This has resulted in great diversity in our customer base, both geographically and by industry, leaving us less sensitive to economic cycles. Our growth over the past few years has been slow, steady and manageable allowing management to react quickly to the changes in the business environment.”
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