Titanium Transportation Group Inc. ("Titanium" or the "Company")
(TSX:TTNM, OTCQX:TTNMF), is pleased to report its financial results
for the three and nine-month period ended September 30, 2023. All
amounts are in Canadian dollars.
Q3 2023 Financial Highlights compared
with Q3 2022
- Consolidated revenue of $112.7
million, compared to $113.4 million in Q3 2022
- Consolidated EBITDA1 of $13.5
million, compared to $15.5 million in Q3 2022
- Consolidated EBITDA Margin1 of
13.6%, compared to 16% in Q3 2022
- Truck Transportation segment
revenue of $62.4 million, compared to $54.9 million in Q3 2022
- Logistics segment revenue of $51.5
million, compared to $59.6 million in Q3 2022
- Fully diluted net income per share
of $0.04, adjusted net income per share of $0.05 after normalizing
for one-time items, compared to Fully diluted net income per share
of $0.14 in Q3 2022.
Q3 2023 Operational
Highlights
- Completed U.S.-based asset
acquisition of Crane Transport, Inc., positioning the Company to
enhance its service offerings with Titanium branded trucks in major
U.S. transportation hubs of Georgia and Alabama.
- Announced the Company’s seventh
U.S. Freight Brokerage office in Jacksonville, FL.
“During the third quarter of 2023, our industry
continued to face significant headwinds including adverse economic
conditions, soft demand and over-capacity,” said Ted
Daniel, Chief Executive Officer, Titanium Transportation
Group. “Despite these challenging conditions, the strength
of our company was demonstrated as we reported another strong and
profitable quarter highlighted by growth in revenue from our
trucking segment. Furthermore, we delivered on our commitment to
sustainable growth by completing the acquisition of Crane, which
provides a strategic foothold for our continued U.S. expansion.
With the integration of Crane well underway and a solid foundation
in place Titanium is well positioned to scale for future,
long-term, sustainable growth.”
Q3 YTD 2023 Financial Highlights
compared with Q3 YTD 2022
- Consolidated revenue of $319.4 million, compared to $385.5
million in Q3 2022.
- EBITDA of $38.1 million, compared to $45.8 million and EBITDA
Margin1 of 13.7%, flat compared to 13.7%
- Logistics segment revenue of $160.5 million. EBITDA of $13.2
million and EBITDA Margin of 9.2%.
- Truck Transportation segment revenue of $163.2 million, a 0.2%
increase over Q3 2022 YTD. EBITDA of $27.8 million with an EBITDA
Margin of 20%.
- Total net income per share of $0.20 fully diluted, adjusted net
income per share of $0.22 after normalizing for one-time items,
compared with total net income per share of $0.45 in Q3 2022.
Summary of Q3 2023 Financial
Results (in thousands $CAD)
|
Q3 2023 |
Q3 2022 |
% Change |
|
YTD 2023 |
YTD 2022 |
% Change |
Consolidated Results |
|
|
|
|
|
|
|
Revenue |
112,685 |
|
113,356 |
|
(0.6%) |
|
|
319,386 |
|
385,526 |
|
(17.2%) |
|
EBITDA1 |
13,456 |
|
15,524 |
|
(13.3%) |
|
|
38,058 |
|
45,776 |
|
(16.9%) |
|
EBITDA margin1 |
13.6% |
|
16.0% |
|
|
|
13.7% |
|
13.7% |
|
|
Net Income |
1,874 |
|
6,537 |
|
(71.3%) |
|
|
8,831 |
|
20,082 |
|
(56.0%) |
|
Net Income per share |
0.04 |
|
0.14 |
|
|
|
0.19 |
|
0.45 |
|
|
|
|
|
|
|
|
|
|
Truck Transportation |
|
|
|
|
|
|
|
Revenue |
62,397 |
|
54,948 |
|
13.6% |
|
|
163,228 |
|
162,903 |
|
0.2% |
|
EBITDA1 |
10,120 |
|
10,429 |
|
(3.0%) |
|
|
27,801 |
|
25,095 |
|
10.8% |
|
EBITDA margin1 |
18.9% |
|
22.9% |
|
|
|
20.0% |
|
18.4% |
|
|
|
|
|
|
|
|
|
|
Logistics |
|
|
|
|
|
|
|
Revenue |
51,543 |
|
59,628 |
|
(13.6%) |
|
|
160,461 |
|
226,169 |
|
(29.1%) |
|
EBITDA1 |
4,471 |
|
5,803 |
|
(22.9%) |
|
|
13,191 |
|
23,380 |
|
(43.6%) |
|
EBITDA margin1 |
9.7% |
|
11.0% |
|
|
|
9.2% |
|
11.5% |
|
|
EBITDA to Net Income (in
thousands $CAD)
|
Q3 2023 |
Q3 2022 |
YTD 2023 |
YTD 2022 |
Net Income |
1,874 |
6,537 |
8,831 |
20,082 |
Add(deduct) |
|
|
|
|
Gain on sale of equipment |
(415) |
(3,344) |
(3,728) |
(5,839) |
Finance costs |
2,522 |
1,257 |
6,078 |
3,188 |
Finance income |
(109) |
(55) |
(412) |
(148) |
Foreign exchange |
1,507 |
1,429 |
986 |
1,891 |
Transaction costs |
205 |
- |
1,285 |
- |
Income taxes |
(520) |
2,443 |
2,304 |
7,370 |
Operating Income |
5,064 |
8,267 |
15,344 |
26,544 |
Depreciation |
8,065 |
6,930 |
21,732 |
18,251 |
Amortization of intangible assets |
327 |
327 |
982 |
981 |
EBITDA |
13,456 |
15,524 |
38,058 |
45,776 |
Developments subsequent to Q3
2023 On October 2, 2023, the Company announced that it was
recognized in The Globe and Mail’s 2023 Report on Business of
Canada’s Top Growing Companies for the third consecutive year. The
rankings are based on the three-year revenue growth of a company,
and in 2023, Titanium was ranked 226th posting growth of 197% in
the last three years - up from 288th in 2022.
2023 Outlook
“Titanium’s success is grounded on the strength
of our people, business processes and technology. With the
acquisition of Crane, as well as our new Freight Brokerage offices,
we remain focused on cost control and profitability while building
towards our future growth,” added Mr.
Daniel. “We anticipate macroeconomic
uncertainty for the remainder of 2023, but continue to be
well-positioned to weather these conditions and drive growth when
the trucking cycle turns. We expect the market to improve during
the second half of 2024, with reductions in supply to the freight
market, enabling additional organic growth and driving value for
shareholders.”
2023 Guidance
Titanium’s revenue guidance for 2023, assumes no
change in the current economic environment, excluding the impact of
any future acquisitions, and is revised to reflect current market
conditions. Notwithstanding downward pressure on revenue the
Company maintains its previous guidance on EBITDA Margin:
- Consolidated Revenue: $430 to $450 million
- Adjusted EBITDA Margin: 10.5% to 12.5%
Conference Call
The Company will also hold a conference call for
analysts and investors with Ted Daniel, President and Chief
Executive Officer on Wednesday, November 15, 2023, 2023 at 8:00
a.m. Eastern Time, to discuss these results.
Details of the conference
call:
Date: Wednesday, November 15,
2023Time: 8:00 a.m. ETNorth America
dial-in number: 1-888-886-7786International
dial-in number: 1-416-764-8658
A replay of the conference call can be accessed
until midnight on December 6, 2023.
Details of the replay:
North America dial-in number: 1-877-674-7070International
dial-in number: 1-416-764-8692Conference ID: 18328130Passcode:
328130#
For more details, or visit Titanium’s investor relations website
at https://www.ttgi.com/investors
About Titanium
Titanium is a leading North American
transportation company with asset-based trucking operations and
logistics brokerages servicing Canada and the United States, with
approximately 1000 power units, 3,300 trailers and 1,300 employees
and independent owner operators. Titanium provides truckload,
dedicated, and cross-border trucking services, logistics, and
warehousing and distribution to over 1,000 customers. Titanium has
established both asset-based and brokerage operations in Canada and
the U.S. with eighteen (18) locations. Titanium is a recognized
purchaser of asset-based trucking companies, having completed
thirteen (13) transactions since 2011. Titanium ranked among top
500 companies in the inaugural Financial Times Americas’ Fastest
Growing Companies in 2020. The Company was ranked by Canadian
Business as one of Canada's Fastest Growing Companies for eleven
(11) consecutive years. For three (3) consecutive years, Titanium
has also been ranked one of Canada’s Top Growing Companies by the
Globe and Mail’s Report on Business of Canada. Titanium is
currently listed on the Toronto Stock Exchange under the symbol
“TTNM" and “TTNMF” on the OTCQX.
NON-IFRS FINANCIAL MEASURES
The following financial measures do not have any
standardized meaning under IFRS and may not be comparable to
similar measures employed by other companies:
"Earnings before interest, income taxes,
depreciation and amortization" ("EBITDA") is calculated as net
income before depreciation, amortization, asset impairments, gains
or losses on the sale of equipment, finance income and costs, gains
or losses on foreign exchange, income tax expense, transaction
costs, accelerated customer list amortization and goodwill
impairment.
"EBITDA margin" is calculated as EBITDA as a
percentage of revenue before fuel surcharge.
“Free cash flow” is calculated as cash flow from
operations plus proceeds from finance lease receivables and
proceeds from disposition, less capital expenditures.
"Adjusted net income" is calculated as net
income before items that are not in the normal course of business,
such as accelerated customer list amortization and goodwill
impairment.
Management of the Company believes that these
financial measures are useful for investors and other readers, when
used in conjunction with other IFRS financial measures, as they are
measurers used internally by management to evaluate performance.
However, these financial measures are intended to provide
additional information and should not be considered in isolation or
as a substitute for measures of financial performance prepared in
accordance with IFRS.
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING STATEMENTS
Certain statements contained in this press
release constitute forward-looking information within the meaning
of Canadian securities laws. Forward-looking statements are
provided for the purposes of assisting the reader in understanding
Titanium's current expectations and plans relating to the future
and readers are cautioned that such statements may not be
appropriate for other purposes. Forward-looking information may
relate to Titanium's future outlook and anticipated events, and may
include statements regarding the financial position, business
strategy, budgets, litigation, projected costs, capital
expenditures, financial results, taxes and plans and objectives of
or involving Titanium. Particularly, statements regarding future
acquisitions, the availability of credit, performance,
achievements, prospects or opportunities for Titanium or the
industry in which it operates are forward-looking statements. In
some cases, forward-looking information can be identified by terms
such as "may", "might", "will", "could", "should", "would",
"occur", "expect", "plan", "anticipate", "believe", "intend",
"seek", "aim", "estimate", "target", "project", "predict",
"forecast", "potential", "continue", "likely", "schedule", or the
negative thereof or other similar expressions concerning matters
that are not historical facts.
Information contained in forward-looking
statements is based upon certain material assumptions that were
applied in drawing a conclusion or making a forecast or projection,
including management's perceptions of historical trends, current
conditions and expected future developments, as well as other
considerations that are believed to be appropriate in the
circumstances. While management considers these assumptions to be
reasonable based on currently available information, they may prove
to be incorrect.
The forward-looking statements made in this
press release are dated, and relate only to events or information,
as of the date of this press release. Except as specifically
required by law, Titanium undertakes no obligation to update or
revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise, after the date on
which the statements are made or to reflect the occurrence of
unanticipated events.
Neither the TSX nor its Regulation Services
Provider (as that term is defined in the policies of the TSX)
accepts responsibility for the adequacy or accuracy of this
release.
Contact Information
Titanium Transportation Group Inc.Ted Daniel, CPA, CAChief
Executive Officer(905) 266-3011ted.daniel@ttgi.comwww.ttgi.com
For Investors James Bowen,
CFA416-519-9442James.Bowen@loderockadvisors.com
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