TFI International is reporting surges in operating profit and net income in the second quarter of 2021, thanks in part to a stronger-than-expected boost linked to the acquisition of UPS Freight.
All four of the fleet’s business segments reached “new heights”, said chairman, president and CEO Alain Bedard, as the fleet reported a rebound in transportation demand when compared to the pandemic-related downturns linked to the same period in 2020.
“It is increasingly clear that our strategy to navigate the unprecedented events of the past year has created a platform for growth and profitability that is the strongest in our company’s history, benefitting from our continued sharp focus on ‘freight that fits’ to capitalize on favorable pricing and volume trends,” Bedard said in a related release.
But where most markets served by TFI have fully recovered from their pandemic-related hits, Canadian markets have generally lagged those in the U.S., the fleet notes in its most recent financial results.
Compared to the second quarter of 2020, operating income from continuing operations reached US $310.3 million, up from the $95.1 million in the Covid-inflicted second quarter of 2020. (All figures are in U.S. dollars.)
Net income from continuing operations reached $251.1 million, compared to US $50.5 million the previous year. Adjusted net income of $137.2 million rose 104% over the $67.2 million seen in the second quarter of 2020.
“Particularly gratifying is the performance of TForce Freight which has exceeded our operating ratio targets far ahead of schedule, and we have only just begun our work,” Bedard added.
In the two months since the UPS Freight deal closed, TForce Freight LTL operations generated $481.1 million in revenue excluding surcharges. And the fleet says it has identified “hundreds” of low-yield accounts and is already taking steps to increase the quality of freight on selected accounts.
Strong pricing and tight capacity in the U.S. market saw a 14.4% year-over-year boost in revenue per mile within TForce Freight’s truckload division when comparing the second quarter to the previous year. Miles per tractor dropped 3.2%, though, because of unseated tractors liked to the driver shortage.
In Canada, the conventional truckload operations saw a 21.8% increase in revenue per tractor and a 19% improvement in revenue per mile as well as a 2.3% increase in miles per tractor.
In specialized truckload work, revenue rose 55.3% over the same three-month period in 2020 as the economy revived.
While the UPS Freight deal closed April 30, the company also secured Brantford, Ontario-based Fleetway Transport on Feb. 1, and Quebec-based Procam International on June 1.
As of June 30, TFI International reported 13,545 tractors, 48,853 trailers, and 10,248 independent contractors – compared to 7,477 tractors, 24,867 trailers, and 10,460 independent contractors on the same day in 2020.
In the first six months of the year, the $2.99 billion in total revenue was up 73% and, net of fuel surcharges, the $2.71 billion in revenue was up 73% compared to the prior year period.
Compared to the prior year period, revenue in the first half of 2021 grew 35% for the package and courier segment, 204% for Less-Than-Truckload, 23% for truckload, and 101% for logistics.