Canadian trucking and oilfield equipment specialist Mullen Transportation posted strong gains in the second quarter of 2004, leading the company to ramp up its investment efforts for the trucking side of its business.
Mullen said net income for the second quarter increased 10.6% to $5.2 million on a 1.8% jump in revenues to $91.1 million compared to the same quarter in 2003. For the first half of 2004, Mullen earned net income of $28 million on revenues of $250.6 million, which it said compares favorably to the mid-point results in 2003 of $17.2 million in net income and revenues of $215.3 million.
"Our [profit] margins increased across the board but were very good on the trucking side," said Murray Mullen, co-chairman & CEO in a conference call with analysts and reporters.
"We are quite pleased with what we see in trucking today; it's a substantially different market from three to four years ago, when we de-emphasized investment in that side of our business because there was just not enough return potential for any investment," he added. "Yet now demand for capacity is very strong and supply [of trucks and drivers] is contained. As an industry and as a company, that gives us more pricing power."
Mullen also boosted its planned 2004 capital expenditures this quarter from $10 million to $20 million as it initiates expansion. "We need to add capital now into our business units - we need to add in capacity to meet customer demands," Mullen said.