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TFI International Announces 2017 Fourth Quarter and Full-Year Results

  • Fourth quarter revenue before fuel surcharge from continuing operations up 2%, to $1.06 billion
  • Net income from continuing operations of $120.2 million in the fourth quarter
  • Adjusted net income from continuing operations1 up 8% to $54.6 million, or $0.60 per diluted share in the fourth quarter

MONTREAL, Quebec, Feb. 20, 2018 (GLOBE NEWSWIRE) -- TFI International Inc. (TSX:TFII) (OTCQX:TFIFF), a North American leader in the transportation and logistics industry, today announced its results for the fourth quarter and full year ended December 31, 2017.

“The fourth quarter capped a year of continued strong progress on our key initiatives, including greater operational efficiency and continued robust cash flow.  Organic growth in operating income was strong in 2017 excluding our U.S. Truckload operations,” said Alain Bédard, Chairman, President and Chief Executive Officer.  “Throughout the year, we generated strong cash flow, which we used to reduce our debt and return excess cash to shareholders through dividends and share buybacks.”

Financial highlightsQuarters ended Dec. 31Years ended Dec. 31
(in millions of dollars, except per share data)2017 2016 2017 2016 
Total revenue from continuing operations1,182.5  1,137.7  4,741.0  4,025.2  
Revenue before fuel surcharge from continuing operations1,059.0  1,036.4  4,281.8  3,704.5  
Adjusted EBITDA from continuing operations1131.0  127.9  514.5  442.4  
Operating income from continuing operations66.8  69.7  243.7  249.3  
Net cash from operating activities from continuing operations116.1  109.8 372.6 337.9 
Adjusted net income from continuing operations154.6  50.6  192.6  187.4  
  Per share – diluted1 ($)0.60  0.54  2.08  1.96  
Net income from continuing operations120.2  46.4  158.0  157.1  
  Per share – diluted ($)1.31  0.49  1.70  1.64  
Net income2120.2  45.3  158.0  639.6  
  Per share – diluted ($)1.31  0.48  1.70  6.70  
Weighted average number of shares ('000s)89,495  91,441  90,494  93,709  

1 This is a non-IFRS measure. For a reconciliation, please refer to the “Non-IFRS Financial Measures” section below.
2 Includes net income (loss) from discontinued operations, of which a $490.8 million after-tax gain on the sale of the Waste Management segment was recorded in the first quarter of 2016.

FOURTH QUARTER RESULTS
Total revenue from continuing operations reached $1.18 billion, up 4% from last year. Net of fuel surcharge, revenue from continuing operations rose 2% to $1.06 billion. The increase reflects business acquisitions offset by revenue declines in some existing operations as well as a negative currency impact.

Operating income from continuing operations decreased by $2.9 million to $66.8 million compared to $69.7 million in the fourth quarter of 2016 mainly due to $4.6 million of lower gains on sale of rolling stock and equipment.

Net income from continuing operations was $120.2 million, or $1.31 per diluted share, versus $46.4 million, or $0.49 per diluted share in the year earlier period. Adjusted net income from continuing operations, which excludes amortization of intangible assets related to business acquisitions, net change in the fair value of derivatives, net foreign exchange gain or loss, gain or loss on sale of property, impairment of intangible assets and the impact from U.S. tax reform, net of tax, was $54.6 million compared to $50.6 million in Q4 2016, up $4.0 million or 8%.  Net income was $120.2 million compared to $45.3 million in Q4 2016.

FULL-YEAR RESULTS
Total revenue from continuing operations increased 18%, to $4.74 billion from $4.03 billion in 2016. The contribution from business acquisitions of $824.1 million and higher fuel surcharge was offset by decreases in revenue from existing operations. Net of fuel surcharge, revenue from continuing operations reached $4.28 billion, up from $3.70 billion last year. Operating income from continuing operations decreased by $5.6 million to $243.7 million compared to $249.3 million in 2016. The decrease is attributable to an operating loss from business acquisitions of $13.2 million offset by improvement from existing operations’ operating income of $7.6 million.

Net income from continuing operations was $158.0 million, or $1.70 per diluted share, versus $157.1 million, or $1.64 per diluted share last year. Adjusted net income from continuing operations increased by $5.2 million to $192.6 million. Net income was $158.0 million compared to $639.6 million for 2016. The decrease is mainly attributable to last year’s net income from discontinued operations of $482.5 million, which includes a gain on the sale of the Waste Management segment in the amount of $490.8 million, net of tax, and to 2017’s intangible impairment charge of $138.4 million, net of tax, offset by the income tax recovery recorded as a result of U.S. tax reform for $76.1 million and by $59.2 million of higher gains on sale of property.
                                                                        
SEGMENTED RESULTS FROM CONTINUING OPERATIONS

(in millions of dollars)    Quarters ended Dec. 31
  Years ended Dec. 31
 2017
   2017
     2017
   2016
  
   $   $    $   $ 
Revenue1         
Package and Courier 317.3  342.0   1,267.3  1,291.3  
Less-Than-Truckload 194.8  181.3   799.2  732.1  
Truckload 480.0  461.4   1,965.3  1,501.2  
Logistics79.0  65.6   299.5  236.6  
Eliminations(12.1)(13.9) (49.5)(56.8)
Total1,059.0  1,036.4   4,281.8  3,704.5  
          
 $ % of Rev.1 $ % of Rev.1  $ % of Rev.1 $ % of Rev.1 
Operating Income (Loss)                 
Package and Courier35.8  11.3%32.3  9.4% 124.4  9.8%113.0  8.8%
Less-Than-Truckload14.3  7.3%13.3  7.3% 52.4  6.6%47.9  6.5%
Truckload 22.7  4.7%29.0  6.3% 77.3  3.9%102.5  6.8%
Logistics6.2  7.9%7.1  10.8% 25.5  8.5%21.8  9.2%
Corporate(12.2) (12.0)  (35.9) (35.9) 
Total66.8  6.3%69.7  6.7% 243.7  5.7%249.3  6.7%

Note: due to rounding, totals may differ slightly from the sum.
1 Revenue before fuel surcharge.

CASH FLOW AND FINANCIAL POSITION
For the year ended December 31, 2017, net cash from operating activities from continuing operations increased by 10% from $337.9 million in 2016 to $372.6 million. The Company used this cash flow to return $150.6 million to shareholders, of which $69.0 million was through dividends and $81.6 million was through share repurchases.

TFI International’s long-term debt-to-equity ratio stood at 1.06 as of December 31, 2017, down from 1.09 a year earlier.

CONFERENCE CALL
TFI International will host a conference call on Tuesday, February 20, 2018 at 5:00 p.m. Eastern Time to discuss these results. Interested parties can join the call by dialling 1-877-223-4471. A recording of the call will be available until midnight, March 5, 2018, by dialing 1-800-585-8367 or 416-621-4642 and entering passcode 2595706.

ABOUT TFI INTERNATIONAL
TFI International Inc. is a North American leader in the transportation and logistics industry, operating across the United States, Canada and Mexico through its subsidiaries. TFI International creates value for shareholders by identifying strategic acquisitions and managing a growing network of wholly-owned operating subsidiaries. Under the TFI International umbrella, companies benefit from financial and operational resources to build their businesses and increase their efficiency. TFI International companies service the following segments:

  • Package and Courier;
  • Less-Than-Truckload;
  • Truckload;
  • Logistics.

TFI International Inc. is publicly traded on the Toronto Stock Exchange (TSX:TFII) and the OTCQX marketplace in the U.S. (OTCQX:TFIFF). For more information, visit http://www.tfiintl.com.

FORWARD-LOOKING STATEMENTS
Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of TFI International. These statements are based on assumptions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for TFI International's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.

NON-IFRS FINANCIAL MEASURES
This press release includes references to certain non-IFRS financial measures as described below. These non-IFRS measures do not have any standardized meanings prescribed by International Financial Reporting Standards (IFRS) and are therefore unlikely to be comparable to similar measures presented by other companies. Accordingly, they should not be considered in isolation, in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with IFRS. The terms and definitions of the non-IFRS measures used in this press release and a reconciliation of each non-IFRS measure to the most directly comparable IFRS measure are provided below.

Adjusted EBITDA from continuing operations
Adjusted EBITDA from continuing operations is calculated as net income or loss from continuing operations before finance income and costs, income tax expense (recovery), depreciation, amortization, gain or loss on sale of land and buildings and assets held for sale and impairment of intangible assets. Management believes adjusted EBITDA from continuing operations to be a useful supplemental measure. Adjusted EBITDA from continuing operations is provided to assist in determining the ability of the Company to generate cash from its operations.

Adjusted EBITDA from continuing operationsQuarters ended Dec. 31
  Years ended Dec. 31
 
(unaudited, in thousands of dollars)2017 2016  2017 2016 
Net income from continuing operations120,192  46,387   157,988  157,059  
Net finance costs13,497  11,266   61,075  54,882  
Income tax expense (recovery)(67,613)14,446   (40,642)46,272  
Depreciation of property and equipment48,298  42,993   209,557  139,439  
Amortization of intangible assets15,949  15,233   61,200  53,647  
Gain on sale of land and buildings(394)(2,382) (232)(8,948)
(Gain) loss on sale of assets held for sale1,088  -   (77,446)-  
Impairment of intangible assets-  -   142,981  -  
Adjusted EBITDA from continuing operations131,017  127,943   514,481  442,351  

Adjusted net income from continuing operations and adjusted earnings per share from continuing operations, basic or diluted
Adjusted net income from continuing operations is calculated as net income or loss excluding amortization of intangible assets related to business acquisitions, net change in the fair value of derivatives, net foreign exchange gain or loss, gain or loss on sale of land and buildings and assets held for sale, impairment of intangible assets, impact from the U.S. tax reform and income or loss from discontinued operations, net of tax. Adjusted earnings per share from continuing operations, basic or diluted, is calculated as adjusted net income from continuing operations divided by the weighted average number of common shares, basic or diluted. The Company uses adjusted net income from continuing operations and adjusted earnings per share from continuing operations to measure its performance from one period to the next, without the variation caused by the impacts of the items described above. The Company excludes these items because they affect the comparability of its financial results and could potentially distort the analysis of trends in its business performance. Excluding these items does not imply they are necessarily non-recurring.

Adjusted net income from continuing operationsQuarters ended Dec. 31
 Years ended Dec. 31
 
(unaudited, in thousands of dollars, except per share data)20172016 2017 2016 
Net income120,192  45,339   157,988  639,579  
Amortization of intangible assets related to business acquisitions, net of tax10,122  9,234   38,346  32,744  
Net change in fair value of derivatives, net of tax49  (2,068) (1,182)3,546  
Net foreign exchange (gain) loss, net of tax(7)(884) 1,826  1,546  
(Gain) loss on sale of land and buildings and assets held for sale, net of tax424  (2,060) (66,710)(7,504)
Impairment of intangible assets, net of tax-  -   138,438  -  
U.S. tax reform(76,135)-   (76,135)-  
Net (income) loss from discontinued operations-  1,048   -  (482,520)
Adjusted net income from continuing operations54,645  50,609   192,571  187,391  
Adjusted earnings per share from continuing operations – basic0.61  0.55   2.13  2.00  
Adjusted earnings per share from continuing operations – diluted0.60  0.54   2.08  1.96  

Note to readers:  Audited consolidated financial statements and Management’s Discussion & Analysis are available on TFI International’s website at http://www.tfiintl.com.

For further information:
Investors:
Alain Bédard
Chairman, President and CEO
TFI International Inc.
(647) 729-4079
[email protected]

Media:
Rick Leckner
MaisonBrison Communications
(514) 731-0000
[email protected]

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