Vitran posts lower 4Q profit on higher revenue

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Vitran Corp. today, Feb. 8, announced yearend and quarterly financial results for the 12- and three-month periods ended Dec. 31.

For the year, Vitran achieved 30.4 percent revenue growth to $670.5 million, including a 32.5 percent increase in Less-Than-Truckload and a 32.9 percent rise in Logistics revenue. Net income for 2007 was $13.7 million. As announced in the company’s third-quarter results, Vitran incurred a one-time $0.3 million write-off of previously capitalized syndication costs, net of taxes, as a result of refinancing its bank syndication agreement. In the comparable 12 months of 2006, the company reported net income of $19.4 million on revenue of $514.1 million.

In the 2007 fourth quarter, Vitran reported revenue of $174.3 million, 13.3 percent above the $153.8 million achieved in the year-ago period. During the three months, the company earned net income of $1.7 million; in the comparable 2006 three-month period, Vitran recorded net income of $5.0 million.

“As expected, the fourth quarter of 2007 marked another challenging period for Vitran and the entire North American trucking industry, as margins continued to experience downward pressure as a result of the soft economic environment,” said Rick Gaetz, president and chief executive officer of Toronto, Ontario-based Vitran. “Importantly, we continue to achieve demonstrable progress internally on a number of key fronts.” Gaetz said that with the company’s new IT operating system in place, “we will begin to focus on the elimination of 13 redundant freight terminals throughout the Upper Midwest.”

Income from operations at Vitran’s LTL segment during the 2007 fourth quarter was $2.2 million, with an operating ratio of 98.5, compared to Q4 ’06 operating income of $8.3 million and a 93.9 OR. Shipments declined 2.8 percent in the LTL segment, and tonnage fell 2.5 percent during the period. Revenue per shipment rose 6.3 percent, and revenue per hundredweight increased 6.0 percent.

Vitran Logistics posted an all-time record quarter, with revenue increasing 89 percent to $18.3 million, a 117 percent rise in income from operations to $1.3 million and a 92.9 OR. As previously announced, Vitran closed its first-ever supply-chain acquisition during Q4 ’07, purchasing California-based LVLA on Dec. 1.

“The 2008 first quarter will be Vitran’s first full reporting period with our most recent acquisition, Las Vegas/L.A. Express, contributing to results,” Gaetz said. “To date, LVLA has been operating to plan, and we are very optimistic about its long-term possibilities given its strong retail customer base and strategic U.S. West Coast location. Our Canadian logistics operations is also expected to grow this coming year, benefiting from new and expanding customer relationships, as well as a new Toronto-based facility slated to come on line during the first half of 2008.”

The Truckload segment also had a solid Q4 ’07, with increases in revenue and income from operations, and a reduction in its OR to 93.3.