CIBCEQUITY RESEARCH
February 9, 2022 Flash Research
MULLEN GROUP LTD.
Q4 First Pass: Operationally In-line Quarter; Healthy Outlook
For 2022
Key Takeaway: Modestly positive impact. MTL reported Q4 results that were operationally in line, with each division coming in roughly as expected. That being said, MTL’s 2022 outlook commentary points to a favourable pricing environment that should drive healthy organic growth combined with M&A opportunities. The company is hosting a conference call on February 10 at 11:00 a.m. ET.
Q4 Recap: Revenue came in at $442MM, up from $298MM in Q4/20, versus our estimate of $428MM (consensus $429MM). EBITDA came in at $61MM, up from $52MM in Q4/20 and versus our estimate of $59MM (cons. $61MM). Adj. EPS in the quarter were $0.22, up from $0.10 in Q4/20 and versus our estimate of $0.14 (cons. $0.19); the variance versus our estimate is attributable in part to lower-than-expected amortization of ntangible assets. FCF (CFO less interest expense, net capex, and cash lease payments) came in at $19MM versus our estimate of $18MM.
Divisional Recap: Below is a recap of MTL’s divisional performance.
- Specialized & Industrial Services: Within S&I, MTL reported $82MM in
revenue, down from $85MM in Q4/20 and versus our estimate of
$84MM. EBITDA came in at $12MM, down from $18MM in Q4/20 and
versus our estimate of $14MM. Margins came in at 15.0% versus 20.9%
in Q4/20 (CEWS adjusted was 17.2%).
- Logistics & Warehousing: Within L&W (we have included U.S. and
International Logistics within L&W), MTL reported $193MM in revenue,
up from $97MM in Q4/20 and versus our estimate of $180MM. EBITDA
came in at $25MM, up from $20MM in Q4/20 and versus our estimate of
$24MM. Margins came in at 13.1% versus 20.7% in Q4/20 (CEWS
adjusted was 19.5%). Within L&W, the U.S. division reported revenue of
$61MM and EBITDA of $2MM, generating an EBITDA margin of 3.3%.
- Less-than-truckload: Within LTL, the company reported $169MM in
revenue, up from $116MM in Q4/20 and versus our estimate of $166MM.
EBITDA came in at $26MM, up from $19MM in Q4/20 and versus our
estimate of $22MM. Margins came in at 15.2% versus 16.2% in Q4/20
(CEWS adjusted 15.2%).
Multi-year Intermodal Agreement With CN: MTL announced that its APPS
subsidiary has entered into a multi-year agreement with CN for the railway to continue to provide intermodal services to APPS Transport. APPS Transport has a network of intermodal service capabilities and service centers that spans all of Canada. This multi-year agreement provides for the movement of all forms of goods throughout Canada.
Conference Call Details: MTL is hosting a call at 11:00 a.m. ET on
February 10. The dial-in number is 800-319-4610