“Relative stability” is the best you can hope for: Bedard

MONTREAL — If the word of the boss at Canada’s biggest carrier is anything to go by, you can expect to see some improvements in the industry later this year.

But we ain’t out of the woods yet.

That’s essentially what the president, CEO and chairman of TransForce Inc., Alain Bedard told shareholders and analysts in a conference call reporting his second quarter results this week.

Bedard said times are so challenging that even “relative stability” is welcome.

"We expect to see some improvement for the industry later in the year,” he said, adding, “for now, we welcome relative stability after many quarters of volume declines and pricing pressure."

Downward pressure on pricing continues to offset the slight increase in volume, he said. The upside is conditions have not deteriorated further in the past three months.

TransForce’s truckload division, which accounts for about a third of its revenue, is driven mainly by cross-border trade and industry insiders hope that leads to a recovery in the Canadian trucking industry. Furthermore, TransForce watchers know that the company entered the downturn determined to cut costs and operate leanly so when the economy does pick up, the company will be operating at peak efficiency. And by Bedard’s reckoning it’s working.

There were other contributing factors. "Oilfield and oilsands operations benefited from increased activity in the second quarter,” he said.

“And the package-and-courier segment grew as a result of an acquisition" said Bédard. "These quarterly results are the best since 2008 and make us cautiously optimistic for the future."

Adjusted net income was $29.2 million or $0.31 per share in the first six months, up significantly from $15.6 million, or $0.18 per share, at the same point last year. TransForce reduced long-term debt by $28.1 million to $679.8 million at the end of the half resulting in a reduction of interest expense of almost $1.9 million to $17.1 million.

Bedard said TransForce will continue to control costs, improve operating effectiveness, and maintain pricing discipline as far as possible in the current environment. The company’s objective is to protect and improve its operating margin.

The positive quarterly results drove TransForce shares up 8 percent.

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