Release Date: November 06, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Canadian ground transportation revenue increased by approximately 8.5% compared to Q3 of last year.
- Dedicated and last mile delivery revenue was up 10.2%, reflecting continued organic growth.
- Consolidated EBITDA margin reached 25.9% for the quarter, the strongest quarterly margin to date in 2024.
- Logistics and distribution revenue increased by 6.8% year over year, driven by growth from pharmaceutical and biologics clients.
- The company maintains a strong balance sheet with a conservative net leverage ratio of 0.74 times, providing financial flexibility for growth opportunities.
Negative Points
- US transportation business continues to face challenging operating conditions, impacting overall performance.
- EBITDA attributable to US operations was approximately $1.5 million lower compared to Q3 last year.
- Packaging revenue declined by 16.7% due to lower volumes.
- Lower fuel surcharge revenue and challenging conditions in US operations affected ground transportation revenue growth.
- Increased SG&A costs related to the implementation of a new warehouse management system slightly offset net income gains.
Q & A Highlights
Q: Looking at your Canadian business, do you expect the high single-digit growth trend to continue into 2025?
A: Michael Andlauer, CEO: Our business remains robust, and we are focused on expanding our network and adding value to our clients. We are comfortable with the Canadian healthcare side of M&A and see opportunities to expand our platform in Canada.
Q: Regarding M&A in healthcare in Canada, are you focusing on transportation logistics or other areas?
A: Michael Andlauer, CEO: We continue to grow organically in transportation logistics, but we are also looking at complementary services in healthcare that align with our current operations.
Q: Is there any indication of a rebound in the US business for 2025?
A: Michael Andlauer, CEO: We believe we have reached the trough and are better positioned for growth in 2025, focusing on higher-value and specialty parts of the business.
Q: Do you expect the typical Q4 revenue improvement this year, considering the US business and Canadian consumer health?
A: Michael Andlauer, CEO: We anticipate a more robust consumer health business in Q4, with some seasonal spikes, although not as significant as other sectors.
Q: How do you view the margin performance given the US business challenges?
A: Michael Andlauer, CEO: Despite US challenges, our margins were strong due to intercompany transactions and lower fuel costs. We aim to maintain our margin range while focusing on sustainability and efficiency.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
