BOLTON, Ont. – Titanium Transportation reported its second
strongest first quarter for revenue, generating $44.3 million despite economic
challenges late in the quarter wrought by the Covid-19 pandemic.
Net income of $600,000 was up slightly year-over-year. Truck
transportation revenue was flat, while logistics generated a 49% increase y-o-y,
thanks in part to the company’s expansion into the U.S. The U.S. operation
contributed $4.7 million to the top line, the company said in an earnings call
with analysts this morning.
It continues to plan the opening of a second U.S. location
in Nashville, Tenn., by the end of the second quarter.
“Our technological investments have positioned Titanium as a
leader in unwavering customer service in a complex, challenging economic environment,”
president and CEO Ted Daniel said, noting the logistics division felt the
greatest impact of the Covid-19-related economic slowdown.
He attributed the company’s diversification for its ability
to weather the storm on the truck transportation side. Titanium has paid down
debt and hoarded cash so it’s ready to move on any acquisition opportunities
that emerge as companies struggle within the current economic backdrop.
“We remain engaged in this area,” Daniel said of M&A
opportunities. The company has $2 million in cash and borrowing capacity of
“We are looking for sellers that are looking for a solution given the current circumstances,” he said, “and that want to be a part of Titanium…We believe given the economic challenges there are going to be some trucking companies that are going to be struggling and we want to have cash for potential M&A. We are looking for companies that didn’t expect this (crisis), good companies, good people, that want to become a part of our more technologically-advanced organization.”
“We have a ton of dry powder sitting in the barn.”
Ted Daniel, Titanium Transportation
For this reason, Daniel said, “cash is king” and that most
capital expenditures have been put on hold, aside from an order of 100
replacement trailers this year.
“We have a ton of dry powder sitting in the barn,” said Daniel,
noting it will likely be used for acquisitions. “We are only going to replace
equipment on an as-necessary basis.”
Marilyn Daniel, chief operating officer, said the company
has been able to keep its equipment busy thanks to its diversified customer
base. While Q2 will see a greater effect on freight volumes, she wouldn’t put a
number on the potential impact.
“We definitely see reductions and are trudging through,
shuffling around some of the equipment in our fleet,” she said. “We’re very
fortunate with our diversification that we’re able to keep most of our fleet
Ted Daniel assured Titanium has ample liquidity to “weather
the economic situation.”
results were excellent given the current economic backdrop,” he concluded. “A
heartfelt thank you to our team who stepped up to maintain uninterrupted
service to our valued customers, many of whom are involved in essential
supplies. When Covid-19 began to affect our end markets, we at Titanium took
swift action to ensure the safety and wellbeing of our workforce, our customers
and our communities at large. We remain vigilant as we continue to service the
essential supply chain.”
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