Mullen Group (MTL.TO)

Business

Oilfield services vs Trucking/Logistics (2:1 revenue).
Oilfield services: transportation, drilling, well-servicing, dewatering.

Balance Sheet

$700M LT-Debt. $248M cash. $900M equity.
Covenant: Total-debt < 3.5 x OCF
It is currently at 2.42.

Management

Shares +2%/year (last 7 years).
CEO Murray Mullen owns 2.8M shares. CEO since 2001.
Good shareholder letters.
Read [Chairman’s Message, 2015]

Valuation

D&A ~ 80M/year
Income before tax ~ 110-192M
EV = $2.2B
EBITDA = 200M – 280M
EV/EBITDA = 7.8x – 11x
Not very cheap ! Something to keep on radar.

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