Titanium posts record Q1 results
Titanium Transportation smashed its revenue record in the first quarter, generating £136 million and producing £5.97 million in profit – a 410% year-over-year increase. Truck transportation revenue was up 26% to £49.3 million, while logistics revenue rose 85% to £87.9 million. The company’s five U.S.
3PL offices contributed £54.9 million of that, up 70%. “Q1 results are a record start to the year marking the highest quarterly revenue achieved in our history, a seventh sequential quarter of top line revenue growth and significantly improved profitability,” said Ted Daniel, CEO of Titanium Transportation Group. “Ongoing inflationary pressures, rising global energy and fuel costs, supply chain challenges and tighter labor markets have seen the industry respond with higher freight rates.
Titanium’s successful navigation of the current operating environment and our ability to increase pricing across our customer base supported strong revenue growth and significantly improved operating margins.”
(Photo: James Menzies)
However, looking ahead, Daniel said there are indications market conditions have “begun to normalize” while inflation and other cost pressures mount. “We are seeing some early indications of some softer consumer trends emerging along with an increase in new smaller industry entrants, although to date, industry load volumes remain generally healthy and we expect 2022 to be a strong year of growth with additional acquisition opportunities for the company,” Daniel said. While the market has been flooded with new entrants, particularly in the U.S., chief operations officer Marilyn Daniel said many of those startups will struggle with higher costs.
“They have definitely entered in on the high point,” she said of new entrants. “We feel that this new group of entrants into the industry may have trouble through a normal economic cycle in the trucking industry. A lot of them came in when trucks were expensive to buy and rates were high. We feel fairly confident that as there may be a bit of softening in the marketplace now, there will be some natural attrition to that group.”
Ted Daniel said about 90% of Titanium’s trucking business is contractual, protecting it from spot market volatility. The company is also pleased that some of its rolling stock ordered last year is beginning to arrive. “OEMs are offering equipment in six to nine months, but it takes more like 12 to 15 months,” he said. “There’s constant delays.”
Titanium has taken delivery of about 60 trucks and 60 trailers so far this year, units that were supposed to come in last year. Chief financial officer Alex Fu said “We are more confident now to say we should be able to get 150 trucks and 250 trailers within a year. We want more, but so far that’s the most realistic target.”
Growth in the U.S. continues, with Titanium adding its fifth brokerage in the quarter, and planning to add two more this year.
The company aspires to have about 20 to 25 freight brokerage locations there.