Mullen Group Ltd. Responds to COVID-19
OKOTOKS, AB, March 20, 2020 /PRNewswire/ - (TSX:MTL) Mullen Group Ltd. ("Mullen Group", "We", "Our" and/or the "Corporation") is actively monitoring the events related to the outbreak of COVID-19. Our Coronavirus Action Plan was implemented on March 2, 2020 and was made available to all of our Business Units recognizing the potential for an incident at one of our facilities as well as preparing for a significant disruption in business. Initially these steps were designed to ensure the safety and the well-being of our employees and contractors. The steps announced today will ensure the continuity of Mullen Group is maintained during this period of disruption, that support can be provided to those people in our organization that will be impacted the hardest and ensure we can bring them back to their jobs as soon as demand returns.
"Challenging times require bold action. Today I am announcing a series of initiatives in response to the unprecedented declines in economic activity related to spread of COVID-19. We all have a responsibility to help those in our communities that are most vulnerable to this virus and of course the health care providers who will be asked to sacrifice immensely in the days that lie ahead," said Mr. Murray K. Mullen, Chairman and Chief Executive Officer.
"Mullen Group is extremely well-positioned to weather this extraordinary situation. As of today we have over $90.0 million in cash on the balance sheet, ample liquidity available in the form of an undrawn line of credit, and a diversified business model. And as bad as the news has been these last few weeks, our business remains robust especially our Less-Than-Truckload segment Business Units. Furthermore, a large portion of our overall business will continue to be required to meet the daily needs of Canadians, a reality reflected by the Canadian Government's decision designating truck drivers as an essential service. So we will have business but clearly as many industries temporarily close the demand for trucking and logistics service will be impacted. We are prepared and the action plans we will implement will ensure Mullen Group recovers quickly once demand is restored. This includes asking our shareholders to take on part of the burden. Our first priority must be to look after those employees, and their families, that will be temporarily laid off which is why today I am announcing that the Mullen Group will be offering assistance to our employee workforce impacted through no fault of their own. Up to $5.0 million will be made available to support employees and their families. There is no better investment we can make than in our employees. We are all in this together," added Mr. Mullen.
Action Plan – COVID-19
- We have already implemented employee safety protocols, including rotating work from home schedules, social distancing and no large gatherings.
- We will temporarily suspend the monthly dividend of $0.05 per Common Share for three months, effective April 1, 2020. The March 31, 2020 dividend will be paid to shareholders of record on April 15, 2020.
- Senior Executives and Directors will reduce their rate of pay for 90 days.
- Suspension of some services along with temporary layoffs due to work shortages. Laid-off employees will remain eligible for company benefit plans.
- We have established the Employee Financial Assistance Fund. Up to $5.0 million will be made available to eligible employees.
- Capital expenditures for fiscal 2020 will remain at $50.0 million, although some capital will be delayed due to plant shutdowns and disruptions to the supply chain.
- We will continue to evaluate acquisitions. However, in light of the economic downturn, valuations will be adjusted accordingly.
- We will continue the share buy-back program under the approved normal course issuer bid. As of today's date we have bought back 667,280 Common Shares at an average price of $5.77.
About Mullen Group Ltd.
Mullen Group is a logistics company that owns a network of independently operated businesses. The Corporation is recognized as one of the leading suppliers of trucking and logistics services in Canada providing a wide range of service offerings including less-than-truckload, truckload, warehousing, logistics, transload, oversized and specialized hauling transportation. In addition, we provide a diverse set of specialized services related to the energy, mining, forestry and construction industries in western Canada, including water management, fluid hauling and environmental reclamation. The corporate office provides the capital and financial expertise, legal support, technology and systems support, shared services and strategic planning to its independent businesses.
Mullen Group is a publicly traded corporation listed on the Toronto Stock Exchange under the symbol "MTL". Additional information is available on our website at www.mullen-group.com or on SEDAR at www.sedar.com.
Certain statements included in this news release constitute "forward-looking statements" under Canadian securities laws, including statements relating to potential purchases of common shares for cancellation under a normal course issuer bid. By their nature, forward-looking statements involve risks, uncertainties and assumptions. The Corporation cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Forward-looking statements may be identified by the use of terminology such as "believes", "expects", "anticipates", "assumes", "outlook", "plans", "targets", or other similar words.
Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors which may cause the actual results or performance of the Corporation to be materially different from the outlook or any future results or performance implied by such statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements. Important risk factors that could affect the forward-looking statements include, but are not limited to, the effects of general economic and business conditions; industry competition; inflation, currency and interest rate fluctuations; changes in fuel prices; legislative and/or regulatory developments; compliance with environmental laws and regulations; actions by regulators; increases in maintenance and operating costs; security threats; reliance on technology and related cybersecurity risk; trade restrictions or other changes to international trade arrangements; transportation of hazardous materials; various events which could disrupt operations, including natural events such as severe weather, droughts, fires, floods and earthquakes; climate change; labor negotiations and disruptions; environmental claims; uncertainties of investigations, proceedings or other types of claims and litigation; timing and completion of capital programs; and other risks detailed from time to time in reports filed by Mullen Group with securities regulators in Canada. Reference should be made to Mullen Group's Management's Discussion and Analysis and Annual Information Form, filed with Canadian securities regulators and available on Mullen Group's website, for a description of major risk factors.
Forward-looking statements reflect information as of the date on which they are made. Mullen Group assumes no obligation to update or revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable securities laws. In the event Mullen Group does update any forward-looking statement, no inference should be made that Mullen Group will make additional updates with respect to that statement, related matters, or any other forward-looking statement.
Mr. Murray K. Mullen - Chairman of the Board, Chief Executive Officer and President
Mr. P. Stephen Clark - Chief Financial Officer
Mr. Richard J. Maloney - Senior Vice President
121A - 31 Southridge Drive
Okotoks, Alberta, Canada T1S 2N3
SOURCE Mullen Group Ltd.