Mullen Group Ltd. Reports Record First Quarter Financial Results

OKOTOKS, AB, April 24, 2013 /CNW/ - (TSX: MTL) Mullen Group Ltd. ("Mullen 
Group" and/or the "Corporation") is pleased to report its financial and 
operating results for the period ended March 31, 2013, with comparisons to the 
same period last year. 
For the three month period ended March 31, 2013, Mullen Group generated 
consolidated revenue of $385.5 million and operating income of $87.8 
million. Mullen Group generated net cash from operating activities of $17.4 
million that was used, together with cash from other sources, to pay dividends 
of $39.5 million, acquire net property, plant and equipment of $13.7 million 
and pay interest obligations of $3.7 million. 
Mullen Group's consolidated revenue of $385.5 million was a decrease of $40.5 
million or 9.5 percent from the $426.0 million generated in 2012. The 
decrease in consolidated revenue was largely attributable to a $39.0 million 
decline in revenue experienced by the Oilfield Services segment, of which 
$21.8 million related to the non-recurring revenue generated by the design, 
build and commissioning of the Thin Fine Tailings ("TFT") barge system project 
for a large oil sands operator which was completed in the second quarter of 
2012, along with a marginal $1.5 million decline in revenue recorded by the 
Trucking/Logistics segment. When factoring out the non-recurring TFT barge 
system project revenue, Mullen's core business revenue was down $18.7 million, 
or 4.6 percent. 
The Oilfield Services segment contributed revenue of $257.6 million, a 
decrease of $39.0 million, or 13.1 percent, from the $296.6 million generated 
in the prior year period. As previously noted, the majority of the decrease in 
revenue occurred in Canadian Dewatering L.P., which generated $21.8 million 
less revenue as a result of the completion of the non-recurring TFT barge 
system project. In addition, reduced demand for services by those Operating 
Entities involved in the transportation of fluids and well servicing, and the 
reduced demand for rig relocation services contributed to the decline in 
revenue. These decreases were partially offset by increased revenue recorded 
by those Operating Entities servicing the pipeline construction industry along 
with core drilling. The Trucking/Logistics segment contributed revenue of 
$129.1 million, which was a marginal decrease of $1.5 million over the prior 
year period. This decrease was mainly attributable to decreased demand for 
over-dimensional and heavy haul freight services. 
Mullen Group generated operating income for the period ended March 31, 2013, 
of $87.8 million, a decrease of $11.3 million or 11.4 percent over the $99.1 
million generated in 2012. The decrease in operating income was mainly 
attributable to the Oilfield Services segment, particularly by those Operating 
Entities providing fluid hauling and well servicing along with those tied to 
drilling activity. In addition, the Trucking/Logistics segment recorded a $1.9 
million decrease in operating income which was generally attributable to those 
Operating Entities providing over-dimensional and multi-modal transportation 
services. As a percentage of consolidated revenue, operating income decreased 
slightly to 22.7 percent as compared to 23.3 percent in 2012. 
"We knew coming into this quarter that it would be difficult to top the first 
quarter of 2012, which was a record in terms of revenue and operating 
income. Specifically, the completion of the TFT barge system project in the 
second quarter of 2012 along with the expectation of reduced drilling activity 
were both known going into the quarter. However, some extreme weather 
conditions in western Canada combined with bottlenecks in takeaway capacity 
with some of our customers in the heavy oil plays of Alberta were situations 
that we had little control over. As well, we witnessed some competitive 
pressures in businesses tied to the servicing of wells as a result of 
decreased drilling and completion activity in western Canada. On a positive 
note, a number of pipeline construction projects kicked off in the quarter 
which directly benefited Premay Pipeline Hauling L.P. and should for the 
foreseeable future, while Treo Drilling Services L.P. once again performed 
very well recording improvements both in terms of productivity and safety 
performance. All-in-all our results met our expectations," stated Mr. Stephen 
H. Lockwood, President and Co-Chief Executive Officer. 
In the first quarter of 2013, Mullen Group generated net income of $44.4 
million, or $0.50 per share, a decrease of $14.4 million, or 24.5 percent 
compared to $58.8 million, or $0.73 per share in 2012. The $14.4 million 
decrease in net income was mainly attributable to the $11.3 million decrease 
in operating income and a $9.6 million negative variance in unrealized foreign 
exchange. These decreases were somewhat offset by a $3.5 million positive 
variance in the fair value of investments and a $3.1 million decrease in 
income tax expense. Adjusting Mullen Group's net income and earnings per 
share to eliminate the impact of unrealized foreign exchange and the change in 
the fair value of investments during the first quarter of 2013 results in 
adjusted net income of $45.4 million and adjusted earnings per share of $0.52, 
as compared to $54.0 million and $0.67 per share in 2012, respectively. 
These adjustments more clearly reflect earnings from an operating perspective. 
A summary of Mullen Group's results for the three month periods ended March 
31,2013, and 2012, along with revenue and operating results by segment are 
as follows: 


                                                           

SUMMARY

(unaudited)                                   Three month periods ended
($ millions, except per share amounts)                March 31
                                               2013  2012        Change
                                                  $     $             %

Revenue                                       385.5 426.0         (9.5)
                                                                       

Operating income((1))                          87.8  99.1        (11.4)

Unrealized foreign exchange loss (gain)         5.0 (4.6)       (208.7)

Decrease (increase) in fair value of          (4.5) (1.0)         350.0
investments

Net income                                     44.4  58.8        (24.5)

Net Income - adjusted((2))                     45.4  54.0        (15.9)

Earnings per share((3))                        0.50  0.73        (31.5)

Earnings per share - adjusted((2))             0.52  0.67        (22.4)

Net cash from operating activities             17.4  54.3        (68.0)

Net cash from operating activities per share(  0.20  0.67        (70.1)
(3))

Cash dividends declared per Common Share       0.30  0.25          20.0
    Notes:

(1)  Operating income is defined as net income before depreciation on
     property, plant and equipment, amortization on intangible assets,
     finance costs, unrealized foreign exchange gains and losses, other
     (income) expense and income tax expense.

(2)  Net income - adjusted and earnings per share - adjusted are
     calculated by adjusting net income and basic earnings per share by
     the amount of any unrealized foreign exchange gains and losses and
     by the change in fair value of investments.

(3)  Earnings per share and net cash from operating activities per
     share are calculated based on the basic weighted average number of
     Common Shares outstanding for the period.
                                                           
        Operating income, net income - adjusted and earnings per share -
     adjusted are not recognized terms under Canadian GAAP and do not
     have standardized meanings prescribed by Canadian GAAP. 
     Management believes these measures are useful supplemental
     measures.  Investors should be cautioned that these indicators
     should not replace net income and earnings per share as indicators
     of performance.
                                       

SEGMENTED RESULTS
                          Three month periods ended


                               March 31
(unaudited)
($ millions)               2013  2012         Change 


                              $     $              %

Revenue                                             
     Oilfield Services    257.6 296.6         (13.1)
     Trucking/Logistics   129.1 130.6          (1.1)
     Corporate              0.1     -              -

Intersegment eliminations                           
     Oilfield Services    (0.5) (0.2)              -
     Trucking/Logistics   (0.8) (1.0)              -

Total                     385.5 426.0          (9.5)

Operating Income                                    
     Oilfield Services     68.6  77.3         (11.3)
     Trucking/Logistics    20.1  22.0          (8.6)
     Corporate            (0.9) (0.2)              -

Total                      87.8  99.1         (11.4)
                                 

This news release may contain forward-looking statements that are subject to 
risk factors associated with the oil and natural gas business and the overall 
economy. Mullen Group believes that the expectations reflected in this news 
release are reasonable, but results may be affected by a variety of 
variables. Mullen Group relies on litigation protection for 
"forward-looking" statements.

Mullen Group is a company that owns a network of independently operated 
businesses. Today the Mullen Group is recognized as the largest provider of 
specialized transportation and related services to the oil and natural gas 
industry in western Canada and as one of the leading suppliers of trucking and 
logistics services in Canada - two sectors of the economy in which Mullen 
Group has strong business relationships and industry leadership. Mullen 
Group provides management and financial expertise, technology and systems 
support 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 SEDAR at www.sedar.com.







Mr. Murray K. Mullen - Chairman of the Board and Chief Executive Officer Mr. 
Stephen H. Lockwood - Co-Chief Executive Officer and President Mr. P. Stephen 
Clark - Chief Financial Officer

121A - 31 Southridge Drive Okotoks, Alberta, Canada T1S 2N3 Telephone: 
403-995-5200 Fax: 403-995-5296

SOURCE: Mullen Group Ltd.

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CO: Mullen Group Ltd.
ST: Alberta
NI: TRN OIL ERN 

-0- Apr/24/2013 21:30 GMT


 
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