Mullen Group profit plunges 27%, but CEO sees turnaround

A tractor-trailer from Mullen Group's Payne Transportation drives on a road. Mullen Group reported second-quarter earnings on July 22.

Mullen Group (TSX:MTL) reported a 27% drop in profits during the second quarter. But even as the Canadian trucking and logistics firm reeled from the impact of COVID-19, the company continued to position itself for recovery as it rehired laid-off employees and reinstated its dividend.

Mullen Group recorded net income of C$23 million (US$17.1 million), or 23 cents per share, on revenue of C$257 million in its second-quarter financial results released on Wednesday. Compared to a year ago, profits fell by 27.4%, while revenue dropped by 19%. 

CEO Murray Mullen said the results were encouraging, however, saying, “business activity is returning, demand has stabilized.” Mullen pointed to the resilience in consumer spending as a bright spot from Mullen’s less-than-truckload business.  

“Given the circumstances, I am pleased with our performance this past quarter,” Mullen said in a statement. “Our business units did a fantastic job managing the business, controlling costs, and keeping our people safe.” 

Mullen Group also announced that it will resume paying its monthly dividend in August.

The results fell within Murray Mullen’s predictions when the company made a midquarter update in June

Less-than-truckload emerged as the most resilient segment. Revenue fell by 9.3% to C$101.9 million. Revenue from specialized and industrial services, with extensive exposure to the oil and gas industry, fell by 30.1% to C$73.5 million. 

Murray Mullen will discuss the results with financial analysts during a conference call on Thursday. 

Click for more FreightWaves articles by Nate Tabak.

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