Mullen predicts more coronavirus pain as it reveals cuts to workforce

A Mullen tractor-trailer

Canada’s Mullen Group on Wednesday reported a slow uptick in its core transportation and logistics businesses in the first quarter, with strength from less-than-truckload, but warned of more pain from COVID-19.

Mullen said it had net income of C$4.7 million, or C$0.04 per share, on C$318 million in revenue. Profits fell by nearly 60% from a year earlier as foreign exchange losses and other costs overshadowed 2.7% growth in operating income.

The Alberta-based firm said its business units had been performing steadily until mid-March as the impact of the COVID-19 pandemic began slowing Canada’s economy to a crawl. CEO Murray Mullen warned of more pain ahead.

“We will see business decline, perhaps quite significantly in the short term, however, I believe we will weather this crisis and come out of it stronger,” Mullen said in a statement.

The company also said it had laid off or furloughed about 1,000 employees as part of its previously announced cutbacks related to COVID-19. That is about 16% of its workforce. Mullen established a C$5 million assistance fund for employees impacted.

Mullen did not detail where it made the cuts. The company still has a significant energy services business in Canada’s oil patch, facing the dual impact of the pandemic and a collapse in oil prices.

Company executives will discuss the result with analysts on Thursday.