OKOTOKS,
AB, Jan. 16, 2023 /PRNewswire/ -
(TSX: MTL) Mullen Group Ltd. ("Mullen
Group", "We", "Our" and/or the
"Corporation"), one of North
America's largest logistics providers announced today that
the budget and business plan for 2023 has been approved by the
Board of Directors ("Board").
"Today we provide our shareholders and interested investors
with an outline of our expectations and priorities for 2023.
As we enter the new year there is a higher level of uncertainty due
to policy changes by banking and regulatory authorities, as they
attempt to slow economic growth and bring inflationary pressures
down from the current unsustainable levels. We have factored
a slowdown in global trade and consumer spending into this year's
plan," commented Mr. Murray K.
Mullen, Senior Executive Officer and Chair.
"Throughout my career one of the most valuable lessons I have
learned is that predicting future outcomes is risky and one should
always be prepared for the unexpected. Last year, for
example, the freight market reached levels that stretched supply
chain capacities, resulting in higher freight prices as customers
struggled to move stranded freight. This combination of
strong freight volumes and pricing increases was a contributing
factor in our record results. By the end of the year,
however, the supply chain issues began to normalize, freight demand
softened, and competition intensified. And while we have not
finalized our fourth quarter results, early indications suggest
revenues will reach $500.0 million,
although margins have softened. The final results will be
available February 9th after the
audit has been completed.
"Entering 2023 there are signs that higher interest rates are
taking a toll on overall economic activity, a reality we have
incorporated into our budget and business plan. As such, it
is reasonable to assume that our 2022 results cannot be replicated
in 2023 by our current Business Units. Nevertheless, in our
diversified business model we are not overly leveraged to any
single vertical or segment in the economy, providing our
organization with an opportunity to have another very good
year. Furthermore, we used 2022 to strengthen the balance
sheet, placing our organization in an excellent position to take
advantage of weakness in the markets to gain market share or pursue
acquisitions. Last year provided our Business Units with the
opportunity to raise prices, this year we will focus on costs and
be on the look out for acquisitions," added Mr. Mullen.
HIGHLIGHTS OF 2023 BUSINESS PLAN AND BUDGET
Budget
|
|
($
millions)
|
Revenue
|
OIBDA
|
Capital
Expenditures
|
|
$
|
$
|
$
|
|
|
|
|
Less-Than-Truckload
|
800.0
|
135.0
|
40.0
|
Logistics
& Warehousing
|
600.0
|
100.0
|
25.0
|
Specialized & Industrial Services
|
375.0
|
75.0
|
20.0
|
U.S. &
International Logistics
|
225.0
|
6.50
|
-
|
Corporate
|
-
|
(16.5)
|
-
|
Total
|
2,000.0
|
300.0
|
85.0
|
|
|
|
|
Shareholder Allocation
One of the main components of our 2023 Business Plan is to
return cash to shareholders by way of monthly dividends and a share
buyback plan. The Board has determined that the appropriate
allocation for 2023 will be:
- Dividends to shareholders will remain consistent at
$0.06 per Common Share each month or
$0.72 per Common Share on an
annualized basis.
- In March 2023, we intend on
requesting approvals from the Toronto Stock Exchange to renew the
normal course issuer bid ("NCIB") program. In 2022, we
repurchased 1,827,483 Common Shares for $22.9 million under the NCIB.
Priorities
In order to achieve the operating results outlined in the 2023
Budget, we have established and will be focusing on the following
priorities:
- Capital Investments: $85.0
million in environmental and efficient operating assets,
exclusive of corporate acquisitions or investment in facilities,
land and buildings.
- $70.0 million: Maintenance
Capital - to improve our Business Units
- $15.0 million Sustainability
Focused Capital - continued focus on emission reduction
- Prioritize Margin over Market Share: work with Business Units
to drive process improvements.
- Effective Deployment of Technology
- Optimize Operations of the Business Units
- Monetize Non-Core Assets
- Pursue Acquisitions: be opportunistic with consolidation
opportunities that are synergistic and accretive.
- Tuck-ins: opportunities that make our existing Business Units
more profitable
- Strategic: opportunities to expand our network
- Maintain Balance Sheet Flexibility
About Mullen Group Ltd.
Mullen Group is one of North
America's largest logistics providers. Our network of
independently operated businesses provide a wide range of service
offerings including less-than-truckload, truckload, warehousing,
logistics, transload, oversized, third-party logistics and
specialized hauling transportation. In addition, we provide a
diverse set of specialized services related to the energy, mining,
forestry and construction industries in western Canada, including water management, fluid
hauling and environmental reclamation. The corporate
office provides the capital and financial
expertise, legal support, technology and systems support,
shared services and strategic planning to its independent
businesses.
Mullen Group is a publicly traded corporation listed on the
Toronto Stock Exchange under the symbol "MTL".
Additional information is available on our website at
www.mullen-group.com or on the Corporation's issuer profile
on SEDAR at www.sedar.com.
Contact Information
Mr. Murray K. Mullen
- Chair, Senior Executive
Officer and President
Mr. Richard J. Maloney - Senior Operating
Officer
Mr. Carson P.
Urlacher - Senior Accounting Officer
Ms.
Joanna K. Scott - Senior Corporate
Officer
121A - 31 Southridge
Drive
Okotoks, Alberta,
Canada T1S 2N3
Telephone:
403-995-5200
Fax: 403-995-5296
Disclaimer
Mullen Group may make statements in this news release that
reflect its current beliefs and assumptions and are based on
information currently available to it and contains forward-looking
statements and forward-looking information (collectively,
"forward-looking statements") within the meaning of applicable
securities laws. This news release may contain
forward-looking statements that are subject to risk factors
associated with the overall economy and the oil and natural gas
business. These forward-looking statements relate to future
events and Mullen Group's future performance. All forward
looking statements contained herein that are not clearly historical
in nature constitute forward-looking statements, and the words
"may", "will", "should", "could", "expect", "plan", "intend",
"anticipate", "believe", "estimate", "propose", "predict",
"potential", "continue", "aim", or the negative of these terms or
other comparable terminology are generally intended to identify
forward-looking statements. Such forward-looking statements
represent Mullen Group's internal projections, estimates,
expectations, beliefs, plans, objectives, assumptions, intentions
or statements about future events or performance. These
forward-looking statements involve known or unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking statements. Mullen Group believes that the
expectations reflected in these forward-looking statements are
reasonable; however, undue reliance should not be placed on these
forward-looking statements, as there can be no assurance that the
plans, intentions or expectations upon which they are based will
occur. In particular, forward-looking statements include but
are not limited to the following: (i) our financial goals and
expectations for 2023; (ii) our capital expenditure plans for 2023;
(iii) our 2022 results cannot be replicated in 2023 by our current
Business Units; (iv) our fourth quarter revenues will reach
$500.0 million although margins have
softened; (v) our organization has an opportunity to have another
very good year; (vi) our strategic initiatives for 2023 including
but not limited to potential acquisitions both strategic and
tuck-in; and (vii) our plan to renew our normal course issuer
bid. These forward-looking statements are based on certain
assumptions and analysis made by Mullen Group in light of our
experience and our perception of historical trends, current
conditions, expected future developments and other factors we
believe are appropriate under the circumstances. These
assumptions include but are not limited to the following: (i)
Mullen Group will generate sufficient cash in excess of our
financial obligations to support the dividend; (ii) Mullen Group's
Business Units will require capital to support their ongoing
operations and growth opportunities and that we will generate
sufficient cash in excess of our financial obligations to support
the capital expenditures; (iii) Mullen Group's expectation as to
how our current Business Units will perform in 2023; (iv) Mullen
Group's expectation as to how our current Business Units
performed in fourth quarter 2022; (v) Mullen Group's view that
we have a diversified business model and we are not overly
leveraged to any single vertical or segment in the economy; (vi)
Mullen Group will have ample liquidity to pursue acquisitions that
are synergistic and accretive, if available; (vii) Mullen Group
will have an opportunity to monetize non-core assets, deploy
technology and optimize operations of our Business Units; and
(viii) Mullen Group's plan to renew its normal course issuer bid
will be approved by regulatory authorities. For further
information on any strategic, financial, operational and other
outlook on Mullen Group's business please refer to Mullen Group's
Management's Discussion and Analysis available for viewing on
Mullen Group's issuer profile on SEDAR at www.sedar.com.
Additional information on risks that could affect the operations or
financial results of Mullen Group may be found under the heading
"Principal Risks and Uncertainties" starting on page 69 of the 2021
Annual Financial Review as well as in reports on file with
applicable securities regulatory authorities and may be accessed
through Mullen Group's issuer profile on the SEDAR website at
www.sedar.com. The forward-looking statements contained in
this news release are expressly qualified by this cautionary
statement. The forward-looking statements contained herein is
made as of the date of this news release and Mullen Group disclaims
any intent or obligation to update publicly any such
forward-looking statements, whether as a result of new information,
future events or results or otherwise, other than as required by
applicable Canadian securities laws. Mullen Group relies on
litigation protection for forward-looking statements.
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SOURCE Mullen Group Ltd.