OKOTOKS, AB, Jan. 15, 2013 /CNW/ - (TSX: MTL) Mullen Group Ltd. ("Mullen Group" and/or the "Corporation") announced today its capital expenditure plan for 2013 as approved by
the Board of Directors. The Board of Directors considered a wide range
of economic issues, commodity pricing predictions and forecasted
drilling activity for the Western Canadian Sedimentary Basin. The
preliminary capital budget for 2013 is set at $80.0 million, which
represents a decline of approximately $23.0 million from the actual
capital expended for 2012. Mullen Group expects to allocate $55.0
million to the Oilfield Services segment and $25.0 million to the
Trucking/Logistics segment. The majority of the funds will be used to
acquire new trucks, trailers and specialized equipment to support the
on-going operations of Mullen Group's Business Units. As the need
arises, the Board of Directors will consider additional capital
requests throughout the year for special projects, the purchase and
development of land, or for acquisitions.
"I am pleased that the Board of Directors accepted the recommendation of
our Senior Executive Team. This capital will ensure that our Business
Units can remain competitive in what I can summarize as a very
challenging market. These investments, among other things, will
enhance our business units' service offerings to our customers, improve
our direct operating expenses and support our human resource strategy
and recruiting initiatives", commented Murray K. Mullen, Chairman and
Chief Executive Officer.
Mullen Group is also pleased to announce that the Board of Directors has
approved an increase in the annual dividend to shareholders from $1.00
per share to $1.20 per share. In addition, Mullen Group will commence
paying the dividend monthly as compared to quarterly. The Board of
Directors of Mullen Group also announced today that it has declared a
dividend of $0.10 per Common Share payable to the holders of record of
Common Shares at the close of business on January 31, 2013. The
dividend will be paid on February 15, 2013. For Canadian resident
shareholders, this dividend is designated as an "eligible dividend" for
purposes of the enhanced dividend tax credit rules contained in the
Income Tax Act (Canada) and any corresponding provincial and
territorial tax legislation.
The decision to increase the annual dividend and to pay it monthly was
based upon a number of factors including; the expectation that Mullen
Group will continue to generate funds from operations in excess of that
required to pay taxes, interest, as well as fund the on-going capital
investments in the organization; Mullen Group's strong balance sheet;
and the emerging trend in the capital markets towards sustainable yield
"While we expect 2013 to be a challenging year with little opportunity
to grow our business due to economic and industry conditions, Mullen
Group will continue to generate significant cash from operations. The
decision our Board of Directors made today is just another example of
how investors in the Mullen Group are rewarded. We have a solid
business model and a very strong balance sheet - the combination which
provides us with the confidence to increase the dividend", added Mr.
This news release may contain forward-looking statements that are
subject to risk factors associated with the oil and natural gas
business and the overall economy. Mullen Group believes that the
expectations reflected in this news release are reasonable, but results
may be affected by a variety of variables. Mullen Group relies on
litigation protection for "forward-looking" statements. Mullen Group
is a company that owns a network of independently operated businesses.
Today the Mullen Group is recognized as the largest provider of
specialized transportation and related services to the oil and natural
gas industry in western Canada and as one of the leading suppliers of
trucking and logistics services in Canada - two sectors of the economy
in which Mullen Group has strong business relationships and industry
leadership. Mullen Group provides management and financial expertise,
technology and systems support 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.
SOURCE: Mullen Group Ltd.