- Increased revenues to $526.3 million
- Increased EBITDA to $56.9 million
- Announced intention to convert from an income fund to a corporation
Montreal, April 30, 2008 – TransForce Income Fund (TSX: TIF.UN), the leader in the Canadian
transportation and logistics industry, today announced improved results for the first quarter of
2008, ended March 31, 2008.
In the first three months of 2008, TransForce delivered increased revenues and EBITDA while
operating in a very challenging economic environment. As customers continue to adjust to the
relative strength of the Canadian dollar, demand has softened, decreasing volumes and putting
downward pressure on pricing in most segments. Already high fuel costs continued to rise
throughout the quarter. In addition, weather conditions were more extreme than usual during the
first three months of the year, which caused delays and some loss of productivity.
Despite these challenges, the Fund increased revenues 13% to $526.3 million from $464.8 million
in the first quarter of 2007. EBITDA (earnings before interest, taxes, depreciation and amortization
and equivalent to operating income on TransForce’s financial statements) also increased to $56.9
million from $52.7 million during the year-earlier period. Significant acquisitions contributed $4.9
million of EBITDA in the first quarter of 2008. The Fund also reported a non-recurring $4.5 million
contribution to EBITDA in the quarter, resulting from a favourable class-action settlement from prior
years which was confirmed by the Supreme Court of Canada.
Cash flow from operating activities, before the net change in non-cash working capital balances was
$45.7 million, an increase from $45.1 million in the first quarter of 2007.
Distributable cash from operating activities was steady year-over-year with $45.1 million in
distributable cash from operating activities generated in the first quarter of 2008 compared with
$45.6 million generated in same period of 2007. The Fund’s regular distribution payout ratio, or
cash distributed as a percent of cash available for distribution, was 90.5%, a decrease from 102.2%
in the first quarter of 2007.
“Although we are operating in the toughest economic climate in at least a decade, TransForce has
generated growth across most of our segments. Our new Package & Courier segment performed well
as did the logistics, waste management, and personnel services divisions in Specialized Services,”
said Alain Bédard, Chairman, President and Chief Financial Executive Officer of TransForce Income
Fund. “Continued slower economic activity and higher fuel costs affected our Less-Than-Truckload
and Truckload operations but these were able to report revenue growth, mostly as the result of
acquisitions in the past year.”
TransForce recently announced it is in advanced discussions regarding a number of potential
strategic acquisitions, totalling more than $100 million, that could be realized in the short term. In
addition, as a result of the pending changes to the tax treatment of the income fund sector,
TransForce also announced its intention to ask unitholders to approve a conversion from an income
fund structure to a growth-oriented corporation, which is better suited to achieving its goal of
delivering value to our investors.
Management Conference Call
TransForce Income Fund will host a conference call for investors to discuss the results of the first
quarter later today, April 30, 2008 at 9:00 a.m. eastern time. Participating from the Fund will be
Alain Bédard, Chairman, President and Chief Executive Officer, and Salvatore Vitale, Chief Financial Officer.
To participate in the conference call, investors are invited to call 1-800-633-8137.
A recording of the call will be available until midnight May 7, 2008, by dialing 1-800-558-5253 or
416-626-4100 and entering passcode 21381609.
Annual and Special Meeting of Unitholders
TransForce will hold its Annual and Special Meeting of Unitholders on May 12, 2008 at 3:00 p.m. at
Sheraton Laval Hotel, 2440 Autoroute des Laurentides, Laval QC. At the meeting, unitholders will
vote on the Fund’s previously announced intention to convert from an income fund to a corporation.
The financial statements for the periods ended March 31, 2008 and 2007 included below are an
integral part of this news release.