Diversity pays off for Mullen

Oil revenues drop, sales up for trucking logistics

Mullen Group Ltd. shares climbed Thursday after it reported a 37 per cent drop in second- quarter oilfield services revenue but a 27 per cent increase in trucking-logistics sales.

The Okotoks- based diversified company, which has committed to grow its trucking- logistics operations at the expense of oilfield services, reported total revenue fell by about nine per cent to $ 285 million in the three- month period ended June 30, versus $ 313 million in the year- earlier time frame.

“Our trucking- logistics segment continues to produce positive results, including record operating income of $ 29.4 million and higher margins,” said chairman and chief executive Murray Mullen

“Unfortunately, our overall results continue to be negatively affected by the slowdown in capital spending and drilling activity by the oil and natural gas industry in Western Canada, which remains under tremendous stress due to low oil and natural gas prices.”

The company reported net income of $ 900,000 versus $ 26 million in the second quarter of 2014. Adjusted earnings were $ 11 million versus $ 15 million. Mullen shares rose as much as six per cent to $ 19.48 on Thursday morning before falling back to close at $ 19.35, up five per cent or 95 cents. They’ve traded between $ 18.11 and $ 30.90 in the past year.

Analysts said the results were in line with expectations.