Mullen Group earnings reached a third-quarter record in the three months ended September 30, 2026, as growth at existing businesses and higher fuel surcharges lifted revenue. The Canadian logistics provider reported on October 22 that net income rose 55.1% to $51.5 million, while revenue increased 16.3% to a quarterly record of $653.2 million. Operating cash flow, however, declined despite the stronger profit.
Key Takeaways
- Internal growth contributed $44.3 million of the $91.4 million revenue increase, exceeding the contribution from acquisitions.
- Adjusted operating income before depreciation and amortization rose 23.0%, with gains across all four operating segments.
- Quarterly operating cash flow fell 23.9% to $78.2 million, contrasting with record third-quarter net income.
Table of Contents
- Mullen Group earnings grow faster than revenue
- Existing businesses lead growth, but fuel adds substantially
- Industrial services and U.S. logistics strengthen
- Cash flow diverges from profit as management eyes expansion
- Conclusion
Mullen Group earnings grow faster than revenue
Mullen Group’s third-quarter results announcement showed basic earnings per share of $0.54, up from $0.38 a year earlier. Per-share earnings grew more slowly than net income because the weighted average basic share count increased to about 96.3 million from 87.2 million.
Operating income before depreciation and amortization, or OIBDA, reached a quarterly record of $118.4 million, up 21.3%. Higher operating earnings and a $3.1 million reduction in finance costs helped lift net income, partly offset by higher income taxes and losses on equipment sales.
Adjusted OIBDA rose to $118.6 million from $96.4 million. As a share of revenue, it increased to 18.2% from 17.2%, a gain of one percentage point. This company-defined non-IFRS measure excludes foreign-exchange gains and losses on U.S.-dollar cash held at the corporate office and is not a substitute for IFRS results.
| Item | Details |
|---|---|
| Cash at September 30, 2026 | $213.9 million, up $42.9 million from June 30. |
| Working capital | $381.3 million, up $43.3 million from June 30. |
| Undrawn bank facilities | $525.0 million of borrowing capacity. |
| Debt-agreement leverage ratio | 2.16 times, compared with a threshold of 3.50 times. |
| Quarterly dividends declared | $0.21 per common share, unchanged from a year earlier. |
Existing businesses lead growth, but fuel adds substantially
The $91.4 million increase in quarterly revenue comprised $44.3 million of internal growth, $37.7 million of additional fuel-surcharge revenue and $9.4 million from acquisitions. The distinction matters: a substantial part of sales growth reflected surcharges associated with higher diesel prices rather than additional underlying freight business.
That effect was especially pronounced in less-than-truckload operations. Segment revenue rose $20.5 million to $218.3 million, but $18.6 million of the increase came from fuel surcharges. Revenue excluding surcharges increased only $1.9 million as some businesses reduced lower-rate customer work to prioritize higher-quality freight.
Logistics and warehousing revenue increased 13.5% to $236.2 million. Beyond fuel surcharges and acquisitions, growth reflected stronger mining-related freight demand at Bandstra, greater cross-border shipment demand and higher freight-forwarding revenue at Abco.
Industrial services and U.S. logistics strengthen
Specialized and industrial services revenue rose 24.7% to $131.1 million, supported by pipeline hauling and stringing, water management and drilling-related activity. Weaker civil construction demand in northern Manitoba and lower production-services revenue partly offset those gains.
The segment’s adjusted OIBDA increased 37.3% to $32.4 million, the strongest percentage increase among the four operating divisions. Mullen attributed the improvement to stronger activity and a greater proportion of higher-margin revenue.
U.S. and international logistics revenue rose 30.4% to $70.3 million as HAUListic experienced stronger demand amid what management described as a tightening U.S. freight market. Adjusted OIBDA increased to $4.8 million, although the operating margin declined to 6.8% from 7.4% because lower-margin freight forwarding represented a larger share of revenue.
Cash flow diverges from profit as management eyes expansion
Net cash from operating activities declined to $78.2 million from $102.7 million in the quarter. Over the first nine months of 2026, it fell 7.4% to $204.2 million, even as net income increased 41.8%. The disclosed figures therefore show that stronger accounting earnings did not translate into higher operating cash generation over either period.
Chair and Senior Executive Officer Murray Mullen said potential nation-building capital projects could create additional logistics demand and reiterated the company’s interest in acquisitions, citing the recent Willson International announcement. Those comments describe prospective opportunities, not revenue already secured from the proposed projects.
Conclusion
Mullen’s record quarter combined growth at existing businesses with improved profitability, rather than relying primarily on acquisitions. Future results will show whether that earnings strength is accompanied by better operating cash generation; potential capital-project demand remains an opportunity rather than a confirmed contribution.
Read More News
Disclaimer
This FinanceVelix article provides general information, not personalized financial, investment, legal, or tax advice. Market prices, interest rates and economic conditions can change; investments carry a risk of loss. Facts reflect the material available when published and may change. Check important information independently and consult a qualified professional when needed. Mentioning an asset, company, or service is not an endorsement.
