TFI International Inc. (TFII) 2020年年度報告「NYSE」.pdf

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1、2020 ANNUAL REPORTMANAGEMENTS DISCUSSION AND ANALYSISCONSOLIDATED FINANCIAL STATEMENTSFOR THE FOURTH QUARTER AND YEAR ENDED DECEMBER 31,2020MANAGEMENTS DISCUSSION AND ANALYSIS 1 1 GENERAL INFORMATIONGENERAL INFORMATION The following is TFI International Inc.s management discussion and analysis(“MD&A

2、”).Throughout this MD&A,the terms“Company”,“TFI International”and“TFI”shall mean TFI International Inc.,and shall include its independent operating subsidiaries.This MD&A provides a comparison of the Companys performance for its three-month period and year ended December 31,2020 with the correspondi

3、ng three-month period and year ended December 31,2019 and it reviews the Companys financial position as of December 31,2020.It also includes a discussion of the Companys affairs up to February 18,2021,which is the date of this MD&A.The MD&A should be read in conjunction with the audited consolidated

4、 financial statements and accompanying notes as at and for the year ended December 31,2020.In this document,all financial data are prepared in accordance with the International Financial Reporting Standards(“IFRS”)as issued by the International Accounting Standards Board(“IASB”)unless otherwise note

5、d.The presentation currency of the Company was changed from Canadian dollars to United States dollars(U.S.dollars)effective December 31,2020,as such all amounts are in U.S.dollars,and the term“dollar”,as well as the symbol“$”,designate U.S.dollars unless otherwise indicated.Variances may exist as nu

6、mbers have been rounded.This MD&A also uses non-IFRS financial measures.Refer to the section of this report entitled“Non-IFRS Financial Measures”for a complete description of these measures.The Companys audited consolidated financial statements have been approved by its Board of Directors(“Board”)up

7、on recommendation of its audit committee on February 18,2021.Prospective data,comments and analysis are also provided wherever appropriate to assist existing and new investors to see the business from a corporate management point of view.Such disclosure is subject to reasonable constraints for maint

8、aining the confidentiality of certain information that,if published,would probably have an adverse impact on the competitive position of the Company.Additional information relating to the Company can be found on its website at .The Companys continuous disclosure materials,including its annual and qu

9、arterly MD&A,annual and quarterly consolidated financial statements,annual report,annual information form,management proxy circular and the various press releases issued by the Company are also available on its website,or directly through the SEDAR system at ,or through the EDGAR system at www.sec.g

10、ov/edgar.shtml.FORWARDFORWARD-LOOKING STATEMENTSLOOKING STATEMENTS The Company may make statements in this report that reflect its current expectations regarding future results of operations,performance and achievements.These are“forward-looking”statements and reflect managements current beliefs.The

11、y are based on information currently available to management.Words such as”may”,“might”,“expect”,“intend”,“estimate”,“anticipate”,“plan”,“foresee”,“believe”,“to its knowledge”,“could”,“design”,“forecast”,“goal”,“hope”,“intend”,“likely”,“predict”,“project”,“seek”,“should”,“target”,“will”,“would”or“co

12、ntinue”and words and expressions of similar import are intended to identify these forward-looking statements.Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results and those presently anticipated or

13、projected.The Company wishes to caution readers not to place undue reliance on any forward-looking statements which reference issues only as of the date made.The following important factors could cause the Companys actual financial performance to differ materially from that expressed in any forward-

14、looking statement:the highly competitive market conditions,the Companys ability to recruit,train and retain qualified drivers,fuel price variations and the Companys ability to recover these costs from its customers,foreign currency fluctuations,the impact of environmental standards and regulations,c

15、hanges in governmental regulations applicable to the Companys operations,adverse weather conditions,accidents,the market for used equipment,changes in interest rates,cost of liability insurance coverage,downturns in general economic conditions affecting the Company and its customers,credit market li

16、quidity,and the Companys ability to identify,negotiate,consummate and successfully integrate business acquisitions.The foregoing list should not be construed as exhaustive,and the Company disclaims any subsequent obligation to revise or update any previously made forward-looking statements unless re

17、quired to do so by applicable securities laws.Unanticipated events are likely to occur.Readers should also refer to the section“Risks and Uncertainties”at the end of this MD&A for additional information on risk factors and other events that are not within the Companys control.The Companys future fin

18、ancial and operating results may fluctuate as a result of these and other risk factors.2020 Annual Report 2 2 MANAGEMENTS DISCUSSION AND ANALYSIS SELECTED FINANCIAL DATA AND HIGHLIGHTSSELECTED FINANCIAL DATA AND HIGHLIGHTS (unaudited)(in thousands of U.S.dollars,except per share data)Three months en

19、dedThree months ended December 31December 31 Years ended Years ended December 31December 31 20202020 2019*2018*20202020 2019*2018*Revenue before fuel surcharge 1,048,1471,048,147 883,717 880,947 3,484,3033,484,303 3,477,576 3,480,214 Fuel surcharge 73,85973,859 105,315 120,711 296,831296,831 425,969

20、 474,543 Total revenue 1,122,0061,122,006 989,032 1,001,658 3,781,1343,781,134 3,903,545 3,954,757 Adjusted EBITDA1 193,538193,538 163,397 137,279 699,589699,589 649,021 529,163 Operating income from continuing operations 117,122117,122 92,784 78,824 416,567416,567 382,868 332,020 Net income 86,3288

21、6,328 56,680 58,450 275,675275,675 233,677 224,820 Net income from continuing operations 86,32886,328 57,955 58,450 275,675275,675 244,225 224,820 Adjusted net income1 93,35793,357 60,085 65,656 299,763299,763 253,583 247,548 Net cash from continuing operating activities 164,928164,928 133,262 131,7

22、43 610,862610,862 500,496 414,993 Free cash flow from continuing operations1 134,715134,715 78,053 78,821 544,644544,644 347,698 259,054 Total assets 3,849,3643,849,364 3,508,820 2,968,744 3,849,3643,849,364 3,508,820 2,968,744 Total long-term debt and lease liabilities 1,228,5301,228,530 1,698,898

23、1,161,430 1,228,5301,228,530 1,698,898 1,161,430 Per share data EPS diluted 0.910.91 0.68 0.65 3.033.03 2.74 2.48 EPS from continuing operations diluted 0.910.91 0.70 0.65 3.033.03 2.86 2.48 Adjusted EPS diluted1 0.980.98 0.72 0.73 3.303.30 2.97 2.73 Dividends 0.230.23 0.20 0.18 0.800.80 0.74 0.67 A

24、s a percentage of revenue before fuel surcharge Adjusted EBITDA margin1 18.518.5%18.5%15.5%20.120.1%18.7%15.2%Depreciation of property and equipment 4.24.2%5.1%4.5%4.94.9%4.9%4.4%Depreciation of right-of-use assets 2.12.1%2.2%2.32.3%2.2%Amortization of intangible assets 1.31.3%1.4%1.3%1.41.4%1.4%1.4

25、%Operating margin from continuing operations 1 11.211.2%10.5%8.9%12.012.0%11.0%9.5%Adjusted operating ratio1 89.189.1%90.2%90.3%88.588.5%89.8%90.6%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.Q4 HighlightsQ4 Highlights Change of presentation currency to U.S.dollar

26、s effective on December 31,2020.Fourth quarter operating income from continuing operations of$117.1 million increased 26%from the same quarter last year on continued strengthening transportation demand following the COVID-19 trough,cost reductions enacted in response to the pandemic,strong execution

27、 across the organization,an asset-light approach,and cost efficiencies.Operating margin from continuing operations1,a non-IFRS measure,increased to 11.2%,up 70 basis points relative to Q4 2019.Net income from continuing operations of$86.3 million increased 49%compared to$58.0 million in Q4 2019.Dilu

28、ted earnings per share(diluted“EPS”)from continuing operations of$0.91 increased from$0.70 in Q4 2019.1 Refer to the section“Non-IFRS financial measures”.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 3 3 Adjusted net income1,a non-IFRS measure,of$93.4 million increased from$60.1 million in Q

29、4 2019.Adjusted diluted EPS1,a non-IFRS measure,of$0.98 increased from$0.72 in Q4 2019.Net cash from continuing operating activities of$164.9 million increased from$133.3 million in Q4 2019.Free cash flow from continuing operations1,a non-IFRS measure,of$134.7 million increased from$78.1 million in

30、Q4 2019.The Companys reportable segments performed as follows:o Package and Courier operating income increased 30%to$29.4 million;o Less-Than-Truckload operating income increased 27%to$24.5 million;o Truckload operating income increased 15%to$53.6 million;and o Logistics operating income increased 8

31、6%to$26.5 million.On December 15,2020,the Board of Directors of TFI declared a quarterly dividend of$0.23(CAD$0.29),a 14%increase over the$0.20(CAD$0.26)dividend in Q4 2019.During the quarter,TFI International acquired the dry bulk business of Grammer Logistics,selected assets of Desrosiers Transpor

32、t,FreightLine Carrier Systems,Excel Transportation,and DLS Worldwide(renamed“TForce Worldwide”).Subsequent to quarter end,TFI agreed to acquire UPS Freight from United Parcel Service,Inc.(NYSE:UPS)with the transaction expected to close during Q2 2021,and acquired Fleetway Transport Inc.Subsequent to

33、 the quarter,TFI International completed its previously announced issuance and sale of an aggregate principal amount of$500 million of senior notes.ABOUT TFI INTERNATIABOUT TFI INTERNATIONALONAL ServicesServices TFI International is a North American leader in the transportation and logistics industr

34、y,operating across the United States,Canada and Mexico through its subsidiaries.TFI International creates value for shareholders by identifying strategic acquisitions and managing a growing network of wholly-owned operating subsidiaries.Under the TFI International umbrella,companies benefit from fin

35、ancial and operational resources to build their businesses and increase their efficiency.TFI International companies service the following reportable segments:Package and Courier;Less-Than-Truckload;Truckload;Logistics.Seasonality of operationsSeasonality of operations The activities conducted by th

36、e Company are subject to general demand for freight transportation.Historically,demand has been relatively stable with the first quarter generally the weakest.Furthermore,during the harsh winter months,fuel consumption and maintenance costs tend to rise.Human resourcesHuman resources As at December

37、31,2020 the Company had 16,753 employees in TFI Internationals various business segments across North America.This compares to 17,150 employees as at December 31,2019.The year-over-year decrease of 397 is attributable to business acquisitions that added 1,329 employees offset by rationalizations aff

38、ecting 1,726 employees mainly in the Less-Than-Truckload(“LTL”)and Truckload segments.The Company believes that it has a relatively low turnover rate among its employees in Canada,and a normal turnover rate in the U.S.comparable to other U.S.carriers,and that its employee relations are very good.1 R

39、efer to the section“Non-IFRS financial measures”.2020 Annual Report 4 4 MANAGEMENTS DISCUSSION AND ANALYSIS EquipmentEquipment The Company believes it has the largest trucking fleet in Canada and a significant presence in the U.S.market.As at December 31,2020,the Company had 7,867 tractors,25,520 tr

40、ailers and 9,901 independent contractors.This compares to 7,772 tractors,25,505 trailers and 9,826 independent contractors as at December 31,2019.FacilitiesFacilities TFI Internationals head office is in Montral,Qubec and its executive office is in Etobicoke,Ontario.As at December 31,2020,the Compan

41、y had 366 facilities,as compared to 380 facilities as at December 31,2019.Of these,235 are located in Canada,including 151 and 84 in Eastern and Western Canada,respectively.The Company also had 119 facilities in the United States and 12 facilities in Mexico.In the last twelve months,45 facilities we

42、re added from business acquisitions,and terminal consolidation decreased the total number of facilities by 59,mainly in the Logistics segment.In Q4 2020,the Company closed 11 sites.CustomersCustomers The Company has a diverse customer base across a broad cross-section of industries with no single cl

43、ient accounting for more than 5%of consolidated revenue.Because of its customer diversity,as well as the wide geographic scope of the Companys service offerings and the range of segments in which it operates,a downturn in the activities of an individual customer or customers in a particular industry

44、 would not be expected to have a material adverse impact on operations.The Company has forged strategic partnerships with other transport companies in order to extend its service offerings to customers across North America.Revenue by Top Customers Industry(59%of total revenue)Revenue by Top Customer

45、s Industry(59%of total revenue)Retail 25%Manufactured Goods 16%Building Materials 8%Metals&Mining 8%Services 8%Automotive 7%Food&Beverage 7%Forest Products 5%Chemicals&Explosives 5%Energy 3%Waste Management 2%Maritime Containers 1%Others 5%(For the year ended December 31,2020)CONSOCONSOLIDATED RESUL

46、TSLIDATED RESULTS This section provides general comments on the consolidated results of operations.A more detailed analysis is provided in the“Segmented results”section.2020 business acquisitions2020 business acquisitions In line with its growth strategy,the Company has acquired thirteen businesses

47、during 2020:the Courier Service business from R.R.Donnelley&Sons Company(“CSB”),Gusgo Transport(“Gusgo”),select assets of CT Transportation,LLC(“CT”),select assets of MCT Transportation,LLC(“MCT”),DSN Chemical Transportation(“DSN”),Keith Hall&Sons(“KHS”),substantially all the assets of CCC Transport

48、ation(“CCC”),selected assets of TBM Logistics Ltd.(“TBM”),selected assets of Desrosiers Transport(“Desrosiers”),the dry bulk business of Grammer Logistics(“Grammer”),FreightLine Carrier Systems(“FreightLine”),DLS Worldwide(“DLS”)renamed“TForce Worldwide”,and Excel Transportation(“Excel”).On March 2,

49、2020,TFI International completed the acquisition of CSB.CSB operates primarily in the Midwest and Southeast U.S.serving the pharmaceutical,healthcare,retail,financial and transportation industries.On June 18,2020,TFI International completed the acquisition of Gusgo.Based in Ontario,Gusgo operates as

50、 a customs-bonded carrier of dry and temperature-controlled commodities in an approximately 500-mile radius around the Greater Toronto Area.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 5 5 On June 26,2020,TFI International completed the acquisition of CT.Based in Georgia,CT specializes in f

51、latbed transportation for major building product manufacturers and home improvement distributors throughout the Southeast and Mid-Atlantic regions of the United States.On June 26,2020,TFI International completed the acquisition of MCT.Based in South Dakota,MCT provides transportation for major compa

52、nies in the packaged food,agriculture,medical and automotive industries,primarily throughout the Southeast and Mid-West regions of the United States.On July 16,2020,TFI International completed the acquisition of DSN.Based in Ontario,DSN provides 3PL transborder services for chemical transportation a

53、nd warehousing for major companies.On July 31,2020,TFI International completed the acquisition of KHS.Based in Ontario,KHS provides food grade transporting services,hauling liquid,dry foods,and general freight across North America.On September 9,2020,TFI International completed the acquisition of CC

54、C.Based in Florida,CCC operates as a truckload carrier offering cement hauling services primarily in the Southeast region of the United States.On September 18,2020,TFI International completed the acquisition of TBM.Based in Alberta,TBM provides bulk transportation in Western Canada and the Pacific N

55、orthwest region of the United States.On October 1,2020,TFI International completed the acquisition Desrosiers.Based in Ontario,Desrosiers provides bulk transportation across lower Ontario.On October 5,2020,TFI International completed the acquisition of Grammer.Based in North Carolina,Grammer focuses

56、 on the transportation of commodities including cement and cementitious materials,sand,fly ash,salt,and lime throughout the southeast United States.On October 31,2020,TFI International completed the acquisition of FreightLine.Based in Ontario,FreightLine provides cross border logistics services.On N

57、ovember 2,2020,TFI International completed the acquisition of DLS.Based in Illinois,DLS provides logistics services through a third-party logistics(“3PL”)network of internal sales personnel,commissioned sales agents,and agent-stations.On November 29,2020,TFI International completed the acquisition o

58、f Excel.Based in Ontario,Excel provides Less-Than-Truckload services across Canada.RevenueRevenue For the three months ended December 31,2020,total revenue was$1,122.0 million,up 13%,or$133.0 million,from Q4 2019.The contribution from business acquisitions of$147.8 million and from an increase in re

59、venue before fuel surcharge of$19.4 million in existing operations was offset by a decrease in fuel surcharge revenue of$34.3 million.The average exchange rate used to convert TFI Internationals revenue generated in CAD dollars increased this quarter(US$0.7667)compared to the same quarter last year(

60、US$0.7576)resulting in a negative currency impact of$7.0 million.For the year ended December 31,2020,total revenue was$3.8 billion,down 3%,or$122.4 million,as compared to$3.9 billion in 2019 mainly due to the decreases in fuel surcharge revenue of$138.6 million and revenue before fuel surcharge of$2

61、83.3 million,both in existing operations,offset by a contribution from business acquisitions of$299.5 million and positive currency impact of$25.1 million.Operating expenses from continuing operationsOperating expenses from continuing operations For the three months ended December 31,2020,the Compan

62、ys operating expenses from continuing operations increased by$108.7 million,to$1,004.9 million from$896.2 million in Q4 2019.The increase attributable to business acquisitions of$141.2 million was partially offset by a net decrease of$32.6 million,or 4%,in existing operating expenses.Operating impro

63、vements,better fleet utilization,lower material and services expenses and lower personnel expenses contributed to maintaining the operating expenses in the Companys existing operations below the Q4 2019 level as a percentage of total revenue.For the three months ended December 31,2020,material and s

64、ervices expenses,net of fuel surcharge,increased by 4.0 percentage points of revenue before fuel surcharge compared to the same period last year due mainly due to business acquisitions which accounted for 2.9 percentage points of the increase.2020 Annual Report 6 6 MANAGEMENTS DISCUSSION AND ANALYSI

65、S For the three months ended December 31,2020,personnel expense increased 1%to$245.4 million from$244.2 million in Q4 2019.The increase includes a mark-to-market loss on DSUs of$3.2 million net of Canadian Emergency Wage Subsidy of$6.3 million.Other operating expenses,which are primarily composed of

66、 costs related to office and terminal rent,taxes,heating,telecommunications,maintenance and security and other general administrative expenses,decreased 0.2 percentage points of revenue before fuel surcharge compared to the same period last year.For the three-month period ended December 31,2020,the

67、gain on sale of assets held for sale was$2.2 million,compared to$6.4 million in Q4 2019.Seven properties were disposed of for a cash consideration of$6.1 million.For the year ended December 31,2020,the Companys operating expenses from continuing operations decreased by$156.1 million from$3.5 billion

68、 in 2019 to$3.4 billion in 2020.The decrease is mainly attributable to a decrease of$291.9 million of materials and service expense and$134.1 million of personnel expenses,both from existing operations,mainly driven by the reduced volumes in Q2 and Q3 attributable to COVID-19.Further contributing to

69、 the decrease in operating expenses is the Canadian Emergency Wage Subsidy of$52.3 million.This is offset by an increase from business acquisitions of$279.5 million.Operating income from continuing operationsOperating income from continuing operations For the three months ended December 31,2020,TFI

70、Internationals operating income from continuing operations rose by$24.3 million to$117.1 million compared to$92.8 million in the same quarter in 2019.The operating margin from continuing operations as a percentage of revenue before fuel surcharge improved,from 10.5%in Q4 2019 to 11.2%in Q4 2020.All

71、reportable segments reported margin increases.Notably,the Less-Than-Truckload segment reported a margin increase of 4.6 percentage points.For the year ended December 31,2020,operating income from continuing operations increased by$33.7 million,or 9%,to$416.6 million compared to$382.9 million in 2019

72、,driven by operating improvements,business acquisitions and the wage subsidy of$52.3 million offset by reduced contributions from the gain on sale of assets held for sale of$9.7 million,a bargain purchase gain of$4.0 million,and gain on sale of rolling stock and equipment of$7.5 million.Finance inco

73、me and costsFinance income and costs (unaudited)(in thousands of U.S.dollars)Three monThree months endedths ended December 31December 31 Years endedYears ended December 31December 31 Finance costs(income)20202020 2019*20202020 2019*Interest expense on long-term debt 7,2877,287 11,344 34,96734,967 43

74、,949 Interest expense on lease liabilities 3,0723,072 3,455 12,44312,443 13,983 Interest income and accretion on promissory note (277(277 )(620)(1,051(1,051 )(2,285)Net change in fair value and accretion expense of contingent considerations 141141 55 224224 199 Net foreign exchange(gain)loss 373373

75、(396)(1,237(1,237 )220 Net change in fair value of interest rate derivatives (488(488 )(488(488 )Others 5,2745,274 1,714 9,0529,052 6,041 Net finance costsNet finance costs 15,38215,382 15,552 53,91053,910 62,107 *Recasted for changes in presentation currency from Canadian dollar to U.S.dollar and m

76、ark-to-market gain(loss)on deferred share units presentation in personnel expenses from finance(income)costs.Interest expense on longInterest expense on long-term debtterm debt Interest expense on long-term debt for the three-month period ended December 31,2020 was$4.1 million less compared to the s

77、ame quarter last year.The decrease is mainly attributable to a lower average debt level of$0.94 billion for the three months ended December 31,2020 as compared to$1.35 billion the same period in the prior year,and a decrease in the average interest rate in 2020 as compared to the prior year.For the

78、year ended December 31,2020,interest expense decreased by$9.0 million due to lower average borrowings of$1.05 billion as compared to$1.31 billion in 2019.Net foreign exchange gain Net foreign exchange gain or loss and net investment hedgeor loss and net investment hedge The Company designates as a h

79、edge a portion of its U.S.dollar denominated debt held against its net investments in U.S.operations.This accounting treatment allows the Company to offset the designated portion of foreign exchange gain(or loss)of its debt against the foreign exchange loss(or gain)of its net investments in U.S.oper

80、ations and present them in other comprehensive income.Net foreign exchange gains or losses recorded in income or loss are attributable to the translation of the U.S.dollar portion of the Companys credit facility not designated as a hedge and to the translation of other financial assets and liabiliti

81、es denominated in TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 7 7 currencies other than the functional currency.For the three-month period ended December 31,2020,a gain of$8.6 million of foreign exchange variations(a gain of$7.5 million net of tax)was recorded to other comprehensive income

82、 as it relates to the translation of the debt in the net investment hedge.For the three-month period ended December 31,2019,a gain of$5.8 million of foreign exchange variations(a gain of$5.0 million net of tax)was recorded to other comprehensive income as it relates to the translation of the debt in

83、 the net investment hedge.For the year ended December 31,2020,a loss of$2.3 million of foreign exchange variations(a loss of$2.0 million net of tax)was recorded to other comprehensive income as it relates to the translation of the debt in the net investment hedge.For the year ended December 31,2019,

84、a gain of$14.0 million of foreign exchange variations(a gain of$12.2 million net of tax)was recorded to other comprehensive income as it relates to the translation of the debt in the net investment hedge.Net change in fair value of derivatives and Net change in fair value of derivatives and cash flo

85、w hedgecash flow hedge The fair values of the Companys derivative financial instruments,which are used to mitigate foreign exchange and interest rate risks,are subject to market price fluctuations in foreign exchange and interest rates.The Company designates the interest rate derivatives as a hedge

86、of the variable interest rate instruments.Therefore,the effective portion of changes in fair value of the derivatives is recognized in other comprehensive income.For the three-month period ended December 31,2020,the loss of$2.6 million on change in fair value of interest rate derivatives(a loss of$1

87、.9 million net of tax)was entirely designated as cash flow hedge and recorded to other comprehensive income as a change in the fair value of the cash flow hedge.For the three-month period ended December 31,2019,a$0.2 million loss on change in fair value of interest rate derivatives(a loss of$0.2 mil

88、lion net of tax)was designated as cash flow hedge and recorded to other comprehensive income as a change in the fair value of the cash flow hedge.For year ended December 31,2020,a$0.5 million loss on change in fair value of interest rate derivatives(a loss of$0.5 million net of tax)was designated as

89、 cash flow hedge and recorded to other comprehensive income as a change in the fair value of the cash flow hedge.For year ended December 31,2019,a$10.0 million loss on change in fair value of interest rate derivatives(a loss of$7.4 million net of tax)was designated as cash flow hedge and recorded to

90、 other comprehensive income as a change in the fair value of the cash flow hedge.As at December 31,2020,the Company no longer had any cash flow hedge positions.Income tax expenseIncome tax expense For the three months ended December 31,2020,the Companys effective tax rate was 15.1%.The income tax ex

91、pense of$15.4 million reflects a$11.6 million favourable variance versus an anticipated income tax expense of$27.0 million based on the Companys statutory tax rate of 26.5%.The favourable variance is mainly due to favourable variations from an adjustment for prior years of$8.3 million,tax deductions

92、 and tax exempt income of 4.6 million and a favourable impact from Treasury Regulations,interpretive guidance clarifying the U.S.Tax Reform Bill of$1.0 million.The positive adjustment for the prior years was mainly due to adjustment to future tax rates used in deferred income taxes.For the year ende

93、d December 31,2020,the Companys effective tax rate was 24.0%.The income tax expense of$87.0 million reflects a$9.1 million favourable variance versus an anticipated income tax expense of$96.1 million based on the Companys statutory tax rate of 26.5%.The favourable variance is mainly due to positive

94、variations for the tax deductions and tax exempt income of$10.2 million,adjustment from prior years of$8.6 million and from lower effective rates in other jurisdictions of$4.5 million offset by negative variances from non-deductible expenses of$8.7 million and interpretive guidance clarifying the U.

95、S.Tax Reform Bill of$4.5 million.The U.S.Tax Reform introduces important changes to U.S.corporate income tax laws that may significantly affect the Group in future years including the creation of a new Base Erosion Anti-abuse Tax(BEAT)that subjects certain payments from U.S.corporations to foreign r

96、elated parties to additional taxes,and limitations to the deduction for net interest expense incurred by U.S.corporations.On April 7,2020,the U.S.Treasury Department issued Treasury Regulations,interpretive guidance clarifying the U.S.Tax Reform Bill.As anticipated,a tax benefit relating to 2019 and

97、 Q1 2020 was disallowed,resulting in a one-time tax expense of$7.3 million in Q2 2020.On July 23,2020,the U.S.Treasury Department issued final regulations on changes made to the U.S.Tax Reform Bill.It introduces a High-Tax Exception under the Global Intangible Low-taxed Income(GILTI)provisions.A tax

98、 benefit relating to 2018 and 2019 was recorded,resulting in a one-time tax recovery of$2.0 million in 2020.For the year ended December 31,2020,the total impact from these new regulations was$4.5 million following positive adjustments recorded in Q4 2020.In addition to the above,significant 2020 low

99、er addition to property and equipment from the companys US operations($69.7 million in 2020 compared to$145.9 million in 2019)resulted in a higher 2020 current tax expense as a percentage of income before income tax as the Company is taking full depreciation on these capital expenditures.2020 Annual

100、 Report 8 8 MANAGEMENTS DISCUSSION AND ANALYSIS Net loss from discontinued oNet loss from discontinued operationsperations During the year ended December 31,2019,the Company recognized a net loss on an accident claim of$10.5 million,or$12.4 million net of$1.9 million of tax recovery.This claim origi

101、nated from an operating entity within the discontinued rig moving operations,which were closed in 2015.Net income and adjusted net incomeNet income and adjusted net income (unaudited)(in thousands of U.S.dollars,except per share data)Three months endedThree months ended December 31December 31 Years

102、endedYears ended December 31December 31 20202020 2019*20202020 2019*Net income 86,32886,328 56,680 275,675275,675 233,677 Amortization of intangible assets related to business acquisitions,net of tax 10,22110,221 9,263 35,28635,286 35,756 Net change in fair value and accretion expense of contingent

103、considerations,net of tax 104104 40 165165 146 Net change in fair value of derivatives,net of tax (373(373 )(373(373 )Net foreign exchange(gain)loss,net of tax 227227 (328)(895(895 )161 Gain on sale of business,net of tax (230(230 )(230(230 )Bargain purchase gain (4,0(4,00808 )(8,014)Gain on sale of

104、 land and buildings and assets held for sale,net of tax (1,848(1,848 )(6,872)(10,308(10,308 )(18,691)Net loss from discontinued operations 1,302 10,548 U.S.Tax Reform (1,072(1,072 )4,4514,451 Adjusted net inAdjusted net incomecome1 1 93,35793,357 60,085 299,763299,763 253,583 Adjusted EPS Adjusted E

105、PS basicbasic1 1 1.001.00 0.74 3.363.36 3.04 Adjusted EPS Adjusted EPS diluteddiluted1 1 0.980.98 0.72 3.303.30 2.97 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.For the three months ended December 31,2020,TFI Internationals net income was$86.3 million compared to

106、$56.7 million in Q4 2019.The Companys adjusted net income1,a non-IFRS measure,which excludes items listed in the above table,was$93.4 million compared to$60.1 million in Q4 2019,up 55%or$33.3 million.Adjusted EPS,fully diluted,increased by$0.26 to$0.98 from$0.72 in Q4 2019.For the year ended Decembe

107、r 31,2020,TFI Internationals net income was$275.7 million compared to$233.7 million in 2019.The increase of$42.0 million is mainly attributable to the contribution from business acquisitions of$13.9 million,improved operating results of existing operations,and the loss from discontinued operations o

108、f$10.5 million reflected in the 2019 comparative amount.The Companys adjusted net income was$299.8 million in 2020 compared to$253.6 million in 2019,up 18%or$46.2 million.Adjusted EPS,fully diluted,increased by 11%,to$3.30.1 Refer to the section“Non-IFRS financial measures”.TFI International MANAGEM

109、ENTS DISCUSSION AND ANALYSIS 9 9 SEGMENTED RESULTSSEGMENTED RESULTS To facilitate the comparison of business level activity and operating costs between periods,the Company compares the revenue before fuel surcharge(“revenue”)and reallocates the fuel surcharge revenue to materials and services expens

110、es within operating expenses.Note that“Total revenue”is not affected by this reallocation.Selected segmented financial informationSelected segmented financial information (unaudited)(in thousands of U.S.dollars)PackagePackage andand CourierCourier LessLess-ThanThan-TruckloadTruckload TruckloadTruckl

111、oad LogisticsLogistics CorporateCorporate EliminationsEliminations TotalTotal Three months ended December 31,2020Three months ended December 31,2020 Revenue before fuel surchargeRevenue before fuel surcharge1 1 154,094154,094 141,081141,081 438,135438,135 322,319322,319 (7,482(7,482 )1,048,1471,048,

112、147%of total revenue%of total revenue2 2 15%15%14%14%42%42%29%29%100%100%Adjusted EBITDAAdjusted EBITDA3 3 35,93435,934 37,08437,084 101,383101,383 35,80935,809 (16,672(16,672 )193,538193,538 AdjusAdjusted EBITDA marginted EBITDA margin4 4 23.3%23.3%26.3%26.3%23.1%23.1%11.1%11.1%18.5%18.5%Operating

113、income(loss)Operating income(loss)29,40129,401 24,46424,464 53,60453,604 26,46226,462 (16,809(16,809 )117,122117,122 Operating marginOperating margin4 4 19.1%19.1%17.3%17.3%12.2%12.2%8.2%8.2%11.2%11.2%Net capital expendituresNet capital expenditures5 5 2,5502,550 6 6,194,194 21,15521,155 7070 244244

114、 30,21330,213 Three months ended December 31,2019*Revenue before fuel surcharge1 127,301 151,303 412,760 198,961 (6,608)883,717%of total revenue2 15%18%47%20%100%Adjusted EBITDA3 29,295 31,269 90,447 21,933 (9,547)163,397 Adjusted EBITDA margin4 23.0%20.7%21.9%11.0%18.5%Operating income(loss)22,680

115、19,311 46,417 14,216 (9,840)92,784 Operating margin4 17.8%12.8%11.2%7.1%10.5%Net capital expenditures5 3,321 27,945 17,783 1,002 5,158 55,209 YTD December 31,2020YTD December 31,2020 Revenue before fuel surchargeRevenue before fuel surcharge1 1 481,490481,490 522,851522,851 1,584,8371,584,837 923,45

116、6923,456 (28(28,331,331 )3,484,3033,484,303%of total revenue%of total revenue2 2 14%14%15%15%46%46%25%25%100%100%Adjusted EBITDAAdjusted EBITDA3 3 104,019104,019 138,361138,361 383,155383,155 113,885113,885 (39,831(39,831 )699,589699,589 Adjusted EBITDA marginAdjusted EBITDA margin4 4 21.6%21.6%26.5

117、%26.5%24.2%24.2%12.3%12.3%20.1%20.1%Operating income(losOperating income(loss)s)78,75378,753 87,95087,950 206,346206,346 84,45984,459 (40,941(40,941 )416,567416,567 Operating marginOperating margin4 4 16.4%16.4%16.8%16.8%13.0%13.0%9.1%9.1%12.0%12.0%Total assets less intangible assetsTotal assets les

118、s intangible assets 194,631194,631 404,074404,074 1,193,7301,193,730 272,592272,592 34,56434,564 2,099,5912,099,591 Net capital expendiNet capital expenditurestures5 5 16,79816,798 19,23019,230 29,17929,179 567567 444444 66,21866,218 YTD December 31,2019*Revenue before fuel surcharge1 473,666 627,21

119、9 1,657,797 745,322 (26,428)3,477,576%of total revenue2 14%18%48%20%100%Adjusted EBITDA3 106,278 126,641 362,641 83,030 (29,569)649,021 Adjusted EBITDA margin4 22.4%20.2%21.9%11.1%18.7%Operating income(loss)82,228 82,230 192,172 57,447 (31,209)382,868 Operating margin4 17.4%13.1%11.6%7.7%11.0%Total

120、assets less intangible assets 180,811 407,358 1,206,568 159,152 49,771 2,003,660 Net capital expenditures5 10,967 27,536 108,039 1,995 4,261 152,798 *Recasted for changes in presentation currency from Canadian dollar to U.S.dollar and mark-to-market gain(loss)on deferred share units presentation in

121、personnel expenses from finance(income)costs.1 Includes intersegment revenue.2 Segment revenue including fuel surcharge and intersegment revenue to consolidated revenue including fuel surcharge and intersegment revenue.3 Refer to the section“Non-IFRS financial measures”4 As a percentage of revenue b

122、efore fuel surcharge.5 Additions rolling stock and equipment,net of proceeds from the sale of rolling stock and equipment and assets held for sale excluding property.2020 Annual Report 1010 MANAGEMENTS DISCUSSION AND ANALYSIS Package and CourierPackage and Courier (unaudited)(in thousands of U.S.dol

123、lars)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31 20202020%2019*%20202020%2019*%Total revenue 167,555167,555 145,018 529,155529,155 539,610 Fuel surcharge (13,461(13,461 )(17,717)(47,665(47,665 )(65,944)RevenueRevenue 154,094154,094 100.

124、0100.0%127,301 100.0%481,490481,490 100.0100.0%473,666 100.0%Materials and services expenses(net of fuel surcharge)72,11572,115 46.846.8%55,737 43.8%220,741220,741 45.845.8%203,441 43.0%Personnel expenses 39,82139,821 25.825.8%35,222 27.7%133,552133,552 27.727.7%138,125 29.2%Other operating expenses

125、 6,2346,234 4.04.0%7,015 5.5%23,14523,145 4.84.8%25,973 5.5%Depreciation of property and equipment 3,1683,168 2.12.1%2,606 2.0%11,53911,539 2.42.4%10,046 2.1%Depreciation of right-of-use assets 3,2103,210 2.12.1%3,713 2.9%12,87112,871 2.72.7%13,956 2.9%Amortization of intangible assets 248248 0.20.2

126、%234 0.2%947947 0.20.2%891 0.2%(Gain)loss on sale of rolling stock and equipment (10(10 )-0.00.0%47 0.0%4343 0.00.0%(135)-0.0%Gain on derecognition of right-of-use assets (15)-0.0%(10(10 )-0.00.0%(16)-0.0%(Gain)loss on sale of land and buildings and assets held for sale (93(93 )-0.10.1%62 0.0%(91(91

127、 )-0.00.0%(843)-0.2%Operating incomeOperating income 29,40129,401 19.119.1%22,680 17.8%78,75378,753 16.416.4%82,228 17.4%Adjusted EBITDAAdjusted EBITDA 35,93435,934 23.323.3%29,295 23.0%104,019104,019 21.621.6%106,278 22.4%*Recasted for change in presentation currency from Canadian dollar to U.S.dol

128、lar.Operational dataOperational data (unaudited)(Revenue in U.S.dollars)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31 20202020 2019*Variance%20202020 2019*Variance%Revenue per pound(including fuel)$0.400.40$0.36$0.04 11.1%$0.30.36 6$0.35$

129、0.01 2.9%Revenue per pound(excluding fuel)$0.360.36$0.31$0.05 16.1%$0.330.33$0.31$0.02 6.5%Revenue per shipment(including fuel)$6.406.40$6.52$(0.12)-1.8%$6.246.24$6.29$(0.05)-0.8%Tonnage(in thousands of metric tons)192192 185 7 3.8%658658 695 (37)-5.3%Shipments(in thousands)26,18526,185 22,244 3,941

130、 17.7%84,85484,854 85,743 (889)-1.0%Average weight per shipment(in lbs.)16.1616.16 18.33 (2.17)-11.8%17.0917.09 17.86 (0.77)-4.3%Vehicle count,average 1,0081,008 972 36 3.7%1,0231,023 981 42 4.3%Weekly revenue per vehicle(incl.fuel,in thousands of U.S.dollars)$12.7912.79$11.48$1.31 11.4%$9.959.95$10

131、.58$(0.63)-6.0%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.RevenueRevenue For the three months ended December 31,2020,revenue increased by$26.8 million or 21%,from$127.3 million in 2019 to$154.1 million in 2020.This increase in revenue is attributable to a 16.1%i

132、ncrease in revenue per pound(excluding fuel surcharge)combined with a 3.8%increase in tonnage.Increase in tonnage was the result of a 17.7%increase in shipments offset by a 11.8%decrease in average weight per shipment.This combination is the result from increased B2C deliveries.For the year ended De

133、cember 31,2020,revenue increased by$7.8 million or 2%,from$473.7 million in 2019 to$481.5 million in 2020.The increase is related to B2C volumes partially offset by disruptions in the early months of the pandemic.Also,during the year ended December 31,2020,the Package and Courier segment experienced

134、 an IT security breach that had a negative impact on the segments revenue estimated at$6 million.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 1111 Operating expensesOperating expenses For the three months ended December 31,2020,materials and services expenses,net of fuel surcharge revenue,i

135、ncreased$16.4 million or 29%,partly due to a$9.4 million increase in subcontractor costs and a$1.5 million increase in external personnel to manage higher volume at sorting facilities.Personnel expenses,as a percentage of revenue,decreased from 27.7%in 2019 to 25.8%in 2020 attributed to reduced weig

136、ht of administrative salaries in percentage of revenue.For the year ended December 31,2020,materials and services expenses,net of fuel surcharge revenue,increased$17.3 million or 9%.Personnel expenses,excluding credits received under Canada Emergency Wage Subsidy of$5.7 million,as a percentage of re

137、venue slightly decreased from 29.2%in 2019 to 28.9%in 2020 mainly due to lower administrative salaries partially offset by increase in direct salaries from higher B2C deliveries.Other operating expenses decreased$2.8 million,or 11%in 2020 mainly coming from reduction in IT charges,travel and office

138、expenses,and external personal.Depreciation of property and equipment increased$1.5 million,or 15%,when compared to 2019,mostly due to investment in conveyors put into operation.Operating incomeOperating income Operating income for the three months ended December 31,2020 increased by 30%or$6.7 milli

139、on compared to the fourth quarter of 2019 and the operating margin was 19.1%in the fourth quarter of 2020 compared to 17.8%for the same period in 2019.This year-over-year increase in operating income was driven primarily by strong organic revenue growth combined with margin expansion.For the year en

140、ded December 31,2020,operating income decreased by$3.5 million to$78.8 million.This decrease is a combination of lower operating income in the first half of the year because of the COVID-19 pandemic and higher B2C volumes generating slightly lower margins.LessLess-ThanThan-TruckloadTruckload (unaudi

141、ted)(in thousands of U.S.dollars)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31 20202020%2019*%20202020%2019*%Total revenue 157,628157,628 175,319 589,235589,235 727,249 Fuel surcharge (16,547(16,547 )(24,016)(66,384(66,384 )(100,030)Reven

142、ueRevenue 141,081141,081 100.0100.0%151,303 100.0%522,851522,851 100.0100.0%627,219 100.0%Materials and services expenses(net of fuel surcharge)67,14067,140 47.647.6%75,026 49.6%252,334252,334 48.348.3%315,648 50.3%Personnel expenses 33,33833,338 23.623.6%38,202 25.2%116,257116,257 22.222.2%159,820

143、25.5%Other operating expenses 3,5873,587 2.52.5%7,788 5.1%16,16,593593 3.23.2%26,720 4.3%Depreciation of property and equipment 4,8864,886 3.53.5%5,148 3.4%19,40719,407 3.73.7%19,736 3.1%Depreciation of right-of-use assets 5,5465,546 3.93.9%6,159 4.1%22,55522,555 4.34.3%24,825 4.0%Amortization of in

144、tangible assets 2,1792,179 1.51.5%2,129 1.4%8,3928,392 1.61.6%8,359 1.3%Gain on sale of rolling stock and equipment (62(62 )-0.00.0%(147)-0.1%(519(519 )-0.10.1%(510)-0.1%Gain on derecognition of right-of-use assets (6(6 )-0.00.0%(835)-0.6%(175(175 )-0.00.0%(1,100)-0.2%Loss(gain)on sale of land and b

145、uildings and assets held for sale 9 9 0.00.0%(1,478)-1.0%5757 0.00.0%(8,509)-1.4%Operating incomeOperating income 24,46424,464 17.317.3%19,311 12.8%87,95087,950 16.816.8%82,230 13.1%AdjusAdjusted EBITDAted EBITDA 37,08437,084 26.326.3%31,269 20.7%138,361138,361 26.526.5%126,641 20.2%*Recasted for ch

146、ange in presentation currency from Canadian dollar to U.S.dollar.2020 Annual Report 1212 MANAGEMENTS DISCUSSION AND ANALYSIS Operational dataOperational data (unaudited)(Revenue in U.S.dollars)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31

147、 20202020 2019*Variance%20202020 2019*Variance%Adjusted operating ratio 82.782.7%88.2%83.283.2%88.2%Revenue per hundredweight(excluding fuel)$10.1510.15$9.99$0.16 1.6%$9.779.77$10.01$(0.24)-2.4%Revenue per shipment(including fuel)$241.02241.02$253.35$(12.33)-4.9%$240.11240.11$242.98$(2.87)-1.2%Tonna

148、ge(in thousands of tons)695695 757 (62)-8.2%2,6752,675 3,132 (457)-14.6%Shipments(in thousands)6 65454 692 (38)-5.5%2,4542,454 2,993 (539)-18.0%Average weight per shipment(in lbs)2,1252,125 2,188 (63)-2.9%2,1802,180 2,093 87 4.2%Average length of haul(in miles)811811 839 (28)-3.3%818818 830 (12)-1.4

149、%Vehicle count,average 902902 1,016 (114)-11.2%918918 1,024 (106)-10.4%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.During 2020 and in the fourth quarter,one business has been acquired in the Less-Than-Truckload segment.RevenueRevenue For the three months ended De

150、cember 31,2020,the LTL segments revenue was$141.1 million,a$10.2 million,or 7%,decrease when compared to the same period in 2019.The decrease in revenue is due to an 8.2%decrease in tonnage partially offset by a 1.6%increase in revenue per hundredweight(excluding fuel).The decrease in tonnage is the

151、 result of a 5.5%decrease in shipments combined with a 2.9%decrease in average weight per shipment.Despite the 7%decline in revenues for the three months ended December 31,2020,the revenues have improved from the second and third quarters,which were heavily impacted by the COVID-19 pandemic,where re

152、venues decreased respectively 30%and 14%as compared to the same periods in 2019.Excluding business acquisitions,revenue was down$11.0 million,or 7%,when compared to the same period in 2019.For the year ended December 31st,2020,revenue decreased$104.4 million or 16.6%to$522.9 million.Operating expens

153、esOperating expenses For the three months ended December 31,2020,materials and services expenses,net of fuel surcharge revenue,decreased$7.9 million,or 10.5%,mostly due to a$10.8 million decrease in sub-contractor cost attributable to decrease in tonnage and partially offset by a reduction in fuel s

154、urcharge revenue.Following the same trend,personnel expenses decreased 12.7%year-over-year,attributable to the decrease in tonnage,a reduction in administrative salaries and credits from the Canada Emergency Wage Subsidy of$2.2 million.Other operating expenses decreased$4.2 million in the fourth qua

155、rter of 2020,mainly due to a$1.8 million reduction in real estate cost combined with$0.4 million reduction in external personnel and a$0.6 million reduction in travel and bad debt expense.The cost reductions,specifically the reduction of administrative salaries and real estate costs,were driven by e

156、fficiencies from the merger of two operating divisions into a single operation.For the year ended December 31,2020,materials and services expenses,net of fuel surcharge,decreased$63.3 million,or 20.1%,mainly due to a$71.4 million reduction in subcontractor cost.Personnel expenses as a percentage of

157、revenue before fuel surcharge decreased from 25.5%in 2019 to 22.2%in 2020,mostly due to credits of$20.3 million from the Canada Emergency Wage Subsidy partially offset by a$2.4 million increase in severance cost.Other operating expenses decreased$10.1 million when compared to the same period in 2019

158、,mainly due to a$4.1 million decrease in real estate cost combined with$1.5 million reduction in external personnel and a$2.2 million reduction in travel,bad debt and IT cost.Operating incomeOperating income Operating income for the three months ended December 31,2020 increased$5.2 million,or 27%,wh

159、en compared to the same period in 2019.As a percentage of revenue,operating income was 17.3%during the fourth quarter of 2020,versus 12.8%for the same period in 2019.For the year ended December 31,2020,operating income increased$5.7 million to$88.0 million.This increase was impacted by gains on sale

160、 of assets held for sale of$7.0 million in the first quarter of 2019 and$1.5 million in the fourth quarter of 2019.Excluding this$8.5 million gain on assets held for sale,operating income of the LTL segment for the twelve-month ended December 31,2020,increased$14.3 million,or 19%,when compared to th

161、e same period in 2019.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 1313 TruckloadTruckload (unaudited)(in thousands of U.S.dollars)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31 20202020%2019*%20202020%2019*%Total revenue 477,2624

162、77,262 469,798 1,748,3591,748,359 1,891,554 Fuel surcharge (39,127(39,127 )(57,038)(163,522(163,522 )(233,757)RevenueRevenue 438,135438,135 100.0100.0%412,760 100.0%1,584,8371,584,837 100.0100.0%1,657,797 100.0%Materials and services expenses(net of fuel surcharge)188,660188,660 43.143.1%178,936 43.

163、4%654,220654,220 41.341.3%707,028 42.6%Personnel expenses 135,911135,911 31.031.0%134,572 32.6%503,242503,242 31.831.8%549,723 33.2%Other operating expenses 1414,323,323 3.33.3%12,534 3.0%52,33752,337 3.33.3%53,472 3.2%Depreciation of property and equipment 34,98634,986 8.08.0%36,218 8.8%136,859136,

164、859 8.68.6%136,139 8.2%Depreciation of right-of-use assets 10,05510,055 2.32.3%7,091 1.7%32,22932,229 2.02.0%24,263 1.5%Amortization of intangible assets 5,1715,171 1.21.2%5,678 1.4%19,89119,891 1.31.3%22,415 1.4%Gain on sale of business (306(306 )-0.10.1%(306(306 )-0.00.0%Gain on sale of rolling st

165、ock and equipment (2,129(2,129 )-0.50.5%(3,603)-0.9%(7,785(7,785 )-0.50.5%(14,698)-0.9%Gain on derecognition of right-of-use assets (13(13 )-0.00.0%(126)-0.0%(332(332 )-0.00.0%(369)-0.0%Gain on sale of land and buildings and assets held for sale (2,127(2,127 )-0.50.5%(4,957)-1.2%(11,864(11,864 )-0.7

166、0.7%(12,348)-0.7%Operating incomeOperating income 53,60453,604 12.212.2%46,417 11.2%206,346206,346 13.013.0%192,172 11.6%Adjusted EBITDAAdjusted EBITDA 101,383101,383 23.123.1%90,447 21.9%383,155383,155 24.224.2%362,641 21.9%*Recasted for change in presentation currency from Canadian dollar to U.S.d

167、ollar.2020 Annual Report 1414 MANAGEMENTS DISCUSSION AND ANALYSIS Operational dataOperational data(unaudited)Three months ended December 31Three months ended December 31 Years ended December 31Years ended December 31 20202020 2019*Variance%20202020 2019*Variance%U.S.based Conventional TLU.S.based Co

168、nventional TL Revenue(in thousands of U.S.dollars)161,476161,476 156,678 4,798 3.1%632,590632,590 646,782 (14,192)-2.2%Adjusted operating ratio 91.591.5%92.4%92.0%92.0%91.5%Total mileage(in thousands)86,42786,427 84,291 2,136 2.5%349,349349,349 351,490 (2,141)-0.6%Tractor count,average 2,9322,932 2,

169、929 3 0.1%2,9492,949 2,960 (11)-0.4%Trailer count,average 11,00511,005 11,007 (2)-0.0%10,93810,938 11,008 (70)-0.6%Tractor age 2.22.2 1.8 0.4 22.2%2.22.2 1.8 0.4 22.2%Trailer age 6.66.6 6.5 0.1 1.5%6.66.6 6.5 0.1 1.5%Number of owner operators,average 560560 424 136 32.1%509509 400 109 27.3%Canadian

170、based Conventional TLCanadian based Conventional TL Revenue(in thousands of U.S.dollars)58,49758,497 56,668 1,829 3.2%206,418206,418 226,816 (20,398)-9.0%Adjusted operating ratio 85.285.2%85.9%86.3%86.3%85.6%Total mileage(in thousands)23,09523,095 24,236 (1,141)-4.7%89,21289,212 98,943 (9,731)-9.8%T

171、ractor count,average 623623 641 (18)-2.8%606606 684 (78)-11.4%Trailer count,average 2,8092,809 2,826 (17)-0.6%2,7962,796 2,884 (88)-3.1%Tractor age 2.52.5 2.3 0.2 8.7%2.52.5 2.3 0.2 8.7%Trailer age 5.95.9 5.4 0.5 9.3%5.95.9 5.4 0.5 9.3%Number of owner operators,average 314314 317 (3)-0.9%302302 333

172、(31)-9.3%Specialized TLSpecialized TL Revenue(in thousands of U.S.dollars)219,093219,093 200,452 18,641 9.3%749,655749,655 791,087 (41,432)-5.2%Adjusted operating ratio 86.986.9%89.3%84.6%84.6%88.3%Tractor count,average 2,3142,314 2,189 125 5.7%2,0962,096 2,099 (3)-0.1%Trailer count,average 6,6196,6

173、19 6,142 477 7.8%6,2516,251 6,121 130 2.1%Tractor age 4.04.0 4.0 0.0 0.0%4.04.0 4.0 0.0 0.0%Trailer age 12.912.9 11.7 1.2 10.3%12.912.9 11.7 1.2 10.3%Number of owner operators,average 1,1321,132 1,224 (92)-7.5%1,1151,115 1,191 (76)-6.4%*Recasted for change in presentation currency from Canadian doll

174、ar to U.S.dollar.During 2020,eight businesses have been acquired in the Truckload segment,including two business acquisitions in the fourth quarter.RevenueRevenue For the three months ended December 31,2020,TL revenue excluding fuel surcharge increased by$25.4 million or 6%,from$412.8 million in 201

175、9 to$438.1 million in 2020.This increase is mainly due to business acquisitions contribution of$34.5 million,offset by a decline in revenue from existing operations of$9.1 million.For conventional TL operations in the U.S.,revenue increased by$4.8 million,or 3.1%compared to prior year period.Revenue

176、 per mile improved by 2.2%,following the strong spot pricing in the US market,and miles per tractor declined by 1.5%,attributable to unseated tractors resulting from the limited driver availability.For conventional TL operations in Canada,revenues increased by$1.8 million,or 3.2%compared to the prio

177、r year period.The increase was due to a 2.5%improvement in revenue per tractor,where revenue per mile improved by 5.2%,offset by a 2.6%decline in miles per tractor.For Specialized TL,revenue increased by$18.6 million,or 9.3%,compared to the prior year period.The TL segment brokerage revenue for the

178、three months ended December 31,2020 decreased by$5.8 million or 10%,to$51.2 million.Brokerage gross margins decreased to 18.7%for the three months ended December 31,2020,from 19.5%in the comparable prior year period.For the year ended December 31,2020,TL revenue decreased by$73.0 million or 4%,from$

179、1,657.8 million in 2019 to$1,584.8 million in 2020.This decrease is mainly due to a decline in revenue from existing operations of$161.0 million,offset by recent business acquisitions contribution of$88.0 million.For the brokerage business,revenue decreased by$50.3 million or 22%,while margins incre

180、ased from 19.0%in 2019 to 19.3%in 2020.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 1515 Operating expensesOperating expenses For the three months ended December 31,2020,operating expenses,including business acquisition impact and net of fuel surcharge,increased by$18.5 million or 5%,from$3

181、66.3 million in 2019 to$384.8 million in 2020.Material and services expenses,net of fuel surcharge,increased by 5%compared to the fourth quarter of 2019.Personnel expenses and other operating expenses increased by 1%and 14%respectively in the fourth quarter year over year.Included in the personnel e

182、xpense was$4.1 million from the Canadian Emergency Wage Subsidy,of which$2.6 million is accounted for in Specialized TL.For the year ended December 31,2020,TL operating expenses,net of fuel surcharge,decreased by$86.8 million or 6%,from$1,465.6 million in 2019 to$1,378.8 million in 2020.The Company

183、continues to improve its cost structure and increase the efficiency and profitability of its existing fleet and network of independent contractors.The decrease in the personnel expense of$46.5 million,or 8%,from$549.7 million in 2019 is primarily due to$24.0 million from the Canadian Emergency Wage

184、Subsidy.Gain on sale of property Gain on sale of property For the three months ended December 31,2020,a$2.0 million gain on sale of assets held for sale was recorded in the Truckload segment following the sale of five properties for total considerations of$6.0 million(a gain of$5.0 million and proce

185、eds of$7.0 million in 2019).These disposals are a result of managements continued efforts to improve efficiencies and benefit from economies of scale through the consolidation of operating locations.For the year ended December 31,2020,a$11.8 million gain on sale of assets held for sale was recorded

186、in the Truckload segment following the sale of properties for total considerations of$23.7 million(a gain of$12.3 million and proceeds of$16.0 million in 2019).Operating Operating incomeincome The TL segments operating ratio was 87.8%for the three months ended December 31,2020 as compared to 88.8%in

187、 2019,a$6.9 million,or 15%,increase in operating income.Operating income in the TL segment was$53.6 million for the three months ended December 31,2020,up from$46.4 million in the same prior year period.The operating income in the fourth quarter of 2019 includes cumulative gains from the sale of ass

188、ets held for sale and gains on the sale of rolling stock and equipment of$8.6 million,as compared to a cumulative amount of$4.3 million in 2020 for a net impact on the operating income of$4.3 million.The decrease in the proceeds on the sale of the rolling stock and equipment is due to a softer resal

189、e market and a reduction in the fleet replacement.For the year ended December 31,2020,the TL segment increased its operating income by$14.2 million or 7%,from$192.2 million in 2019 to$206.3 million in 2020.2020 Annual Report 1616 MANAGEMENTS DISCUSSION AND ANALYSIS Logistics Logistics (unaudited)(in

190、 thousands of U.S.dollars)Three months ended Three months ended December 31December 31 Years ended December 31Years ended December 31 20202020%2019*%20202020%2019*%Total revenue 327,689327,689 206,268 945,130945,130 774,833 Fuel surcharge (5,370(5,370 )(7,307)(21,674(21,674 )(29,511)RevenueRevenue 3

191、22,319322,319 100.0100.0%198,961 100.0%923,456923,456 100.0100.0%745,322 100.0%Materials and services expenses(net of fuel surcharge)241,798241,798 75.075.0%140,019 70.4%668,225668,225 72.472.4%524,098 70.3%Personnel expenses 24,38124,381 7.67.6%25,427 12.8%93,57993,579 10.110.1%96,593 13.0%Other op

192、erating expenses 19,98319,983 6.26.2%11,745 5.9%48,01248,012 5.25.2%41,865 5.6%Depreciation of property and equipment 596596 0.20.2%640 0.3%2,3362,336 0.30.3%2,147 0.3%Depreciation of right-of-use assets 3,1383,138 1.01.0%2,520 1.3%13,20413,204 1.41.4%14,148 1.9%Amortization of intangible assets 5,6

193、085,608 1.71.7%4,557 2.3%17,88917,889 1.91.9%17,302 2.3%Bargain purchase gain (4,008(4,008 )-0.40.4%(8,014)-1.1%(Gain)loss on sale of rolling stock and equipment 368368 0.10.1%(5)-0.0%373373 0.00.0%(43)-0.0%Gain on derecognition of right-of-use assets (20(20 )-0.00.0%(158)-0.1%(618(618 )-0.10.1%(221

194、)-0.0%Loss on sale of land and buildings and assets held for sale 5 5 0.00.0%5 5 0.00.0%Operating incomeOperating income 26,46226,462 8.28.2%14,216 7.1%84,45984,459 9.19.1%57,447 7.7%Adjusted EBITDAAdjusted EBITDA 35,80935,809 11.111.1%21,933 11.0%113,885113,885 12.312.3%83,030 11.1%*Recasted for ch

195、ange in presentation currency from Canadian dollar to U.S.dollar.During 2020,four businesses have been acquired in the Logistics segment,including two business acquisitions in the fourth quarter.RevenueRevenue For the three months ended December 31,2020,revenue increased by$123.4 million,or 62%,from

196、$199.0 million in 2019 to$322.3 million.Excluding business acquisitions,revenue increased by$14.0 million,or 7%,mainly attributable to strong eCommerce activities in Canada.For the year ended December 31,2020,revenue increased by$178.1 million,or 24%,from$745.3 million to$923.5 million.Excluding bus

197、iness acquisitions,revenue decreased by 3.1%or$23.1 million.Approximately 71%(2019 72%)of the Logistics segments revenues in the quarter were generated from operations in the U.S.and Mexico and approximately 29%(2018 28%)were generated from operations in Canada.Operating expensesOperating expenses F

198、or the three months ended December 31,2020,total operating expenses,net of fuel surcharge,increased by$110.9 million,or 60%,from$184.7 million to$295.6 million.Excluding business acquisitions,total operating expenses,net of fuel surcharge,increased by$4.7 million or 2.5%,explained by$11.9 million in

199、crease in materials and services expenses(net of fuel surcharge)due to the revenue increase,but partially offset by a$4.3 million decrease in personnel expenses and$3.0 million decrease in other operating expense,mostly coming from the optimization of our last mile operations in the U.S.For the year

200、 ended December 31,2020,operating expenses,net of fuel surcharge,increased by$150.8 million,or 22%,compared to 2019,from$687.9 million to$838.7 million.Excluding business acquisitions,operating expenses decreased by$39.1 million,or 5.7%.Operating incomeOperating income Operating income for the three

201、 months ended December 31,2020 increased by$12.2 million,or 86%,from$14.2 million to$26.5 million,driven primarily by strong organic revenue growth combined with margin expansion.Excluding business acquisitions,operating margin increased by 380 basis points from 7.1%in 2019 to 10.9%in 2020,mainly as

202、 a result of higher quality revenue and cost efficiency measures from our last mile operations.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 1717 For the year ended December 31,2020,operating margin increased by 1.5 percentage points to 9.1%.Excluding the bargain purchase gains and the busin

203、ess acquisitions of 2020,operating income increased by 48%or$23.7 million compared to 2019,while the operating margin increased from 6.6%to 10.2%.LIQUIDITY AND CAPITAL RESOURCESLIQUIDITY AND CAPITAL RESOURCES Sources and useSources and uses of cashs of cash (unaudited)(in thousands of U.S.dollars)Th

204、ree months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Sources of cash:Net cash from continuing operating activities 164,928164,928 133,262 610,862610,862 500,496 Proceeds from sale of property and equipment 23,94923,949 20

205、,785 52,11652,116 71,754 Proceeds from sale of assets held for sale 6,2486,248 13,079 24,48024,480 39,146 Net variance in cash and bank indebtedness 273,791273,791 270 Net proceeds from long-term debt 136,569 Proceeds from the issuance of common shares 425,350425,350 Proceeds from the sale of busine

206、ss 2,3512,351 2,3512,351 Others 3,1283,128 4,861 48,14248,142 18,362 Total sources 474,395474,395 172,257 1,163,31,163,30101 766,327 Uses of cash:Purchases of property and equipment 60,69360,693 92,551 142,710142,710 261,295 Business combinations,net of cash acquired 244,053244,053 (284)327,650327,6

207、50 150,912 Net variance in cash and bank indebtedness 6,5286,528 6,083 Net repayment of long-term debt 116,153116,153 18,303 484,247484,247 Repayment of lease liabilities 22,40822,408 19,859 82,58782,587 75,072 Dividends paid 18,43418,434 14,840 67,60467,604 60,478 Repurchase of own shares 22,823 38

208、,02138,021 192,455 Net cash used in discontinued operations 1,275 12,022 Others 12,65412,654 2,890 13,95413,954 8,010 Total usage 474,395474,395 172,257 1,163,3011,163,301 766,327 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.Cash flow from continuing operating act

209、ivitiesCash flow from continuing operating activities For the year ended December 31,2020,net cash from continuing operating activities increased by 22%to$610.9 million from$500.5 million in 2019.This$110.4 million increase is attributable to an increase in net income of$42.0 million,$17.3 million f

210、rom improvements in net change in working capital,a decrease in interest paid of$14.7 million,and a reduction in income taxes paid of$12.0 million.2020 Annual Report 1818 MANAGEMENTS DISCUSSION AND ANALYSIS Cash flow used in investing activities from continuinCash flow used in investing activities f

211、rom continuing operationsg operations Property and equipmentProperty and equipment The following table presents the additions of property and equipment by category for the three-month periods and years ended December 31,2020 and 2019.(unaudited)(in thousands of U.S.dollars)Three months endedThree mo

212、nths ended DeceDecember 31mber 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Additions to property and equipment:Purchases as stated on cash flow statements 60,69360,693 92,551 142,710142,710 261,295 Non-cash adjustments (283(283 )(3,478)104104 2,403 60,41060,410 89,07

213、3 142,814142,814 263,698 Additions by category:Land and buildings 5,0555,055 36,450 19,33119,331 39,733 Rolling stock 52,74452,744 49,524 112,645112,645 211,796 Equipment 2,6112,611 3,099 10,83810,838 12,169 60,41060,410 89,073 142,814142,814 263,698 *Recasted for change in presentation currency fro

214、m Canadian dollar to U.S.dollar.The Company invests in new equipment to maintain its quality of service while minimizing maintenance costs.Its capital expenditures reflect the level of reinvestment required to keep its equipment in good order and to maintain a strategic allocation of its capital res

215、ources.In the normal course of activities,the Company constantly renews its rolling stock equipment generating regular proceeds and gain or loss on disposition.The following table indicates the proceeds and gains or losses from sale of property and equipment and assets held for sale by category for

216、the three-month periods and years ended December 31,2020 and 2019.(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Proceeds by category:Land and buildings 6,0536,053 13,210 23

217、,87723,877 39,535 Rolling stock 24,07824,078 20,654 52,46852,468 70,600 Equipment 6666 251251 765 30,19730,197 33,864 76,59676,596 110,900 Gains(losses)by category:Land and buildings 2,1322,132 6,374 11,87711,877 21,581 Rolling stock 2,2752,275 3,781 8,3758,375 15,616 Equipment (368(368 )(74)(471(47

218、1 )(231)4,0394,039 10,081 19,78119,781 36,966 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.Business acquisitionsBusiness acquisitions For the year ended December 31,2020,cash used in business acquisitions totalled$327.7 million to acquire thirteen businesses.Refer

219、 to the section of this report entitled“2020 business acquisitions”and further information can be found in note 5 of the December 31,2020 audited consolidated financial statements.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 1919 Cash flow used in financing activities Cash flow used in fina

220、ncing activities ComCommon sharesmon shares On February 13,2020,the Company issued 6,900,000 common shares in the United States and Canada as part of its initial public offering in the United States raising net proceeds of$217.6 million.On August 11,2020,the Company issued 5,060,000 common shares in

221、 the United States and Canada,raising net proceeds of$207.8 million.Cash flow used in discontinued operationsCash flow used in discontinued operations For the year ended December 31,2019,discontinued operations used cash of$12.0 million.Free cash flow from continuing opeFree cash flow from continuin

222、g operationsrations (unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Net cash from continuing operating activities 164,928164,928 133,262 610,862610,862 500,496 Additions to p

223、roperty and equipment (60,410(60,410 )(89,073)(142,814(142,814 )(263,698)Proceeds from sale of property and equipment 23,94923,949 20,785 52,11652,116 71,754 Proceeds from sale of assets held for sale 6,2486,248 13,079 24,48024,480 39,146 Free cash flow from continuing opeFree cash flow from continu

224、ing operationsrations 134,715134,715 78,053 544,644544,644 347,698 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.The Companys objectives when managing its cash flow from operations are to ensure proper capital investment in order to provide stability and competitiv

225、eness for its operations,to ensure sufficient liquidity to pursue its growth strategy,and to undertake selective business acquisitions within a sound capital structure and a solid financial position.For the year ended December 31,2020,TFI International generated free cash flow from continuing operat

226、ions of$544.6 million,compared to$347.7 million in 2019,which represents a year-over-year increase of$196.9 million.This increase is mainly due to more net cash from continuing operating activities of$110.4 million,largely stemming from an increase in net income of$42.0 million,$17.3 million from im

227、provements in working capital,a decrease in interest paid of$14.7 million,and a reduction in income taxes paid of$12.0 million,and to a reduction in net capital expenditures of$86.6 million due to the Companys cash management measure put in place as a response to COVID-19 in Q2.The capital expenditu

228、res of rolling stock in Q4 have been re-established to prior year levels,$52.7 million in 2020 as compared to$49.5 million in 2019.The free cash flow conversion,which measures the level of capital employed to generate earnings,improved for the three months ended December 31,2020 to 83.9%from 80.4%,d

229、ue to improved operating results than compared to 2019.For the year ended December 31,2020 the free cash flow conversion improved to 89.9%from 76.5%due to the impact of reduced capital expenditures.Based on the December 31,2020 closing share price of$51.58,the free cash flow generated by the Company

230、 during 2020($544.6 million)represented a yield of 11.3%.Financial positionFinancial position (unaudited)(in thousands of U.S.dollars)As atAs at December 31,2020December 31,2020 As at December 31,2019*As at December 31,2018*Total assets 3 3,849,364,849,364 3,508,820 2,968,744 Long-term debt 872,5448

231、72,544 1,343,307 1,161,430 Lease liabilities 355,986355,986 355,591 Shareholders equity 1,790,1771,790,177 1,159,292 1,155,882 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.*Excludes the impacts from the adoption of IFRS 16 Leases as discussed in note 3 of the audi

232、ted 2019 consolidated financial statements.As is permitted with this new standard,comparative information has not been restated and,therefore,may not be comparable.Recasted for change in presentation currency from Canadian dollar to U.S.dollar.2020 Annual Report 2020 MANAGEMENTS DISCUSSION AND ANALY

233、SIS Compared to December 31,2019,the Companys long-term debt decreased by$470.8 million,or 35%during 2020.The repayment of debt was funded by the cash generated from operating activities and from the issuances of common shares,which injected$563.1 million of cash.The share issuances explain most of

234、the increase in shareholders equity as well.As at December 31,2020,the Companys working capital(accounts receivable,inventory and prepaids less accounts payable)was$168.3 million compared to$149.2 million as at December 31,2019.The increase is mainly attributable to business acquisitions and timing

235、differences of receipts and payments.ContContractual obligations,commitments,contingencies and offractual obligations,commitments,contingencies and off-balance sheet arrangementsbalance sheet arrangements The following table indicates the Companys contractual obligations with their respective maturi

236、ty dates at December 31,2020,excluding future interest payments.(unaudited)(in thousands of U.S.dollars)TotalTotal Less thanLess than 1 year1 year 1 to 31 to 3 yearsyears 3 to 53 to 5 yearsyears AfterAfter 5 years5 years Unsecured revolving facility June 2023 125,428125,428 125,428 Unsecured revolvi

237、ng facility November 2021 7,4617,461 7,461 Unsecured term loan June 2022 322,200322,200 322,200 Unsecured debenture December 2024 157,171157,171 157,171 Unsecured senior notes December 2026 150,000150,000 150,000 Conditional sales contracts 113,086113,086 35,536 59,662 17,352 536 Lease liabilities 3

238、55,986355,986 88,522 132,525 68,038 66,901 Total contractual obligationsTotal contractual obligations 1,231,3321,231,332 131,519131,519 639,815639,815 242,561242,561 217,437217,437 On November 21,2020,the Company renewed its credit facility for one year.The credit facility is unsecured and provides

239、an availability of$25 million maturing in November 2021.The interest rate follows the same pricing grid applicable for the debt in the CAD$1,200 million revolving credit facility.On December 18,2020,the Company repaid,without penalty,the first tranche of CAD$200 million of its term loan which was to

240、 mature in June 2021.Subsequent to year end,on January 13,2021,the Company received$500 million proceed from a new debt taking the form of unsecured senior notes consisting of four tranches maturing between January 2029 and January 2036 and bearing interest between 3.15%and 3.50%.The following table

241、 indicates the Companys financial covenants to be maintained under its credit facility.These covenants are measured on a consolidated rolling twelve-month basis and are calculated as prescribed by the credit agreement which,among other things,requires the exclusion of the impact of the new standard

242、IFRS 16 Leases:CovenantsCovenants RequirementsRequirements As at As at December 31,2020December 31,2020 Funded debtFunded debt-toto-EBITDA ratioEBITDA ratio ratio of total debt plus letters of credit and some other long-term liabilities to earnings before interest,income tax,depreciation and amortiz

243、ation(“EBITDA”),including last twelve months adjusted EBITDA from business acquisitions 1.75 4.78 As at December 31,2020,the Company had$29.5 million of outstanding letters of credit($32.1 million on December 31,2019).As at December 31,2020,the Company had$117.1 million of purchase commitments and$4

244、4.1 million of purchase orders that the Company intends to enter into a lease that is expected to materialize within a year(December 31,2019$27.1 million and$9.0 million,respectively).TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 2121 Dividends and outstanding share dataDividends and outstan

245、ding share data DividendsDividends The Company declared$21.3 million in dividends,or$0.23(CAD$0.29)per common share,in the fourth quarter of 2020.The Board of Directors approved a quarterly dividend of$0.23 per outstanding common share of the Companys capital,for an expected aggregate payment of$21.

246、5 million to be paid on April 15,2021 to shareholders of record at the close of business on March 31,2021.NCIB on common sharesNCIB on common shares Pursuant to the renewal of the normal course issuer bid(“NCIB”),which began on October 14,2020 and expires on October 13,2021,the Company is authorized

247、 to repurchase for cancellation up to a maximum of 7,000,000 of its common shares under certain conditions.As at December 31,2020,and since the inception of this NCIB,the Company has not repurchased and cancelled any common shares.For the year ended December 31,2020,the Company repurchased 1,542,155

248、 common shares(as compared to 6,409,446 in 2019)at a weighted average price of$24.64 per share(as compared to$30.03 in 2019)for a total purchase price of$38.0 million(as compared to$192.5 million in 2019).Outstanding shares,stock options and restricted share unitsOutstanding shares,stock options and

249、 restricted share units A total of 93,397,985 common shares were outstanding as at December 31,2020(December 31,2019 81,450,326).There was no material change in the Companys outstanding share capital between December 31,2020 and February 18,2021.As at December 31,2020,the number of outstanding optio

250、ns to acquire common shares issued under the Companys stock option plan was 2,982,514(December 31,2018 4,421,866)of which 2,111,364,were exercisable(December 31,2019 3,039,635).On July 27,2020,the Board of Directors approved the grant of 99,485 stock options under the Companys stock option plan.Each

251、 stock option entitles the holder to purchase one common share of the Company at an exercise price based on the volume-weighted average trading price of the Companys shares for the last five trading days immediately preceding the effective date of the grant.As at December 31,2020,the number of restr

252、icted share units(RSUs)granted under the Companys equity incentive plan to its senior employees was 299,075(December 31,2019 239,337).On February 7,2020,the Board of Directors approved the grant of 145,218 RSUs under the Companys equity incentive plan.The RSUs will vest in February of the third year

253、 following the grant date.Upon satisfaction of the required service period,the plan provides for settlement of the award through shares.As at December 31,2020,the number of performance share units(PSUs)granted under the Companys equity incentive plan to its senior employees was 147,121(December 31,2

254、019 nil).On February 7,2020,the Board of Directors approved the grant of 145,218 PSUs under the Companys equity incentive plan.The PSUs will vest in February of the third year following the grant date.Upon satisfaction of the required service period,the plan provides for settlement of the award thro

255、ugh shares.Legal proceedingsLegal proceedings The Company is involved in litigation arising from the ordinary course of business primarily involving claims for bodily injury and property damage.It is not feasible to predict or determine the outcome of these or similar proceedings.However,the Company

256、 believes the ultimate recovery or liability,if any,resulting from such litigation individually or in total would not materially adversely nor positively affect the Companys financial condition or performance and,if necessary,has been provided for in the financial statements.OUTLOOKOUTLOOK The North

257、 American economy was impacted significantly in 2020 by the Coronavirus(COVID-19)pandemic before a general recovery began midyear.While many of the end markets served by TFI International remained relatively strong throughout,such as the transport of essential household goods,medical products and eC

258、ommerce,others such as business-to-business and transportation for the apparel and automotive industries have only recently begun to recover.In early February 2021,nearly one year since the onset of the pandemic,a broad economic recovery continues but significant uncertainty remains due to unknowns

259、around more contagious COVID-19 strains,the distribution of vaccines and their overall effectiveness.TFI International has remained fully operational during the ongoing pandemic with uninterrupted service,by leveraging its integrated and far-reaching network.Nonetheless,economic visibility is curren

260、tly lower than normal,and a second wave of Coronavirus-related economic disruption could again result in social distancing mandates and lockdowns,adversely impacting end markets served by TFIs operating companies and resulting in another round of declines in freight volumes and pricing.Additional un

261、certainties include stock market volatility and an ongoing heightened level of civil unrest,along with potential policy changes to be enacted by the new US presidential administration surrounding international trade,environmental mandates,tax and other matters.2020 Annual Report 2222 MANAGEMENTS DIS

262、CUSSION AND ANALYSIS Management believes the Company is well prepared to navigate any further disruption in the economic landscape due to its focus on efficiency and its lean cost structure,partially reflecting cost reduction measures enacted in 2020 in response to the pandemic,as well as a longstan

263、ding focus on profitability,efficiency,and the rationalization of assets to avoid internal overcapacity.TFI is particularly well positioned to benefit from the expansion of eCommerce and from potential growth and cost synergies related to its recently announced acquisition of UPS Freight,expected to

264、 close during the second quarter of 2021.In addition,the Company continues to have strong liquidity and a conservative balance sheet.Longer term,management believes its decisions over the past year have already facilitated the return to year-over-year growth,and that TFIs current positioning,to be f

265、urther enhanced by the pending acquisition of UPS Freight,should enable the Company to emerge even stronger when conditions normalize.Regardless of operating conditions,managements goal is to build long-term shareholder value through consistent adherence to its operating principles,including the int

266、ense customer focus exhibited by its many dedicated professionals,its asset-light approach to the business,continual efforts to enhance efficiencies,and an effective strategy around industry consolidation.SUMMARY OF EIGHT MOST RECENT QUARTERLY RESULTSSUMMARY OF EIGHT MOST RECENT QUARTERLY RESULTS (u

267、naudited)(in millions of U.S.dollars,except per share data)Q420Q420 Q320*Q320*Q220*Q220*Q120*Q120*Q419*Q419*Q319*Q319*Q219*Q219*Q119*Q119*Total revenue 1,122.0 936.1 798.5 924.5 989.0 988.4 1,000.3 925.9 Adjusted EBITDA1 193.5 189.4 167.6 149.1 163.4 167.9 176.7 141.1 Operating income from continuin

268、g operations 117.1 117.0 95.1 87.3 94.1 99.9 120.6 78.9 Net income 86.3 83.1 50.5 55.8 56.7 62.5 65.6 48.9 EPS basic 0.92 0.91 0.58 0.66 0.70 0.75 0.78 0.57 EPS diluted 0.91 0.90 0.57 0.65 0.68 0.74 0.76 0.56 Net income from continuing operations 86.3 83.1 50.5 55.8 58.0 62.5 74.8 48.9 EPS from cont

269、inuing operations basic 0.92 0.91 0.58 0.66 0.71 0.76 0.89 0.57 EPS from continuing operations diluted 0.91 0.90 0.57 0.65 0.70 0.74 0.87 0.56 Adjusted net income1 93.4 87.5 67.2 52.6 60.1 66.8 76.3 50.4 Adjusted EPS diluted1 0.98 0.94 0.76 0.61 0.72 0.79 0.88 0.58 *Recasted for change in presentati

270、on currency form Canadian dollar to U.S.dollar.The differences between the quarters are mainly the result of seasonality(softer in Q1)and business acquisitions.Higher 2020 and 2019 operating income was also driven by strong execution across the organization,increased quality of revenue,and cost effi

271、ciencies.The decline in Q2 2020 is due to COVID-19 related business interruptions.NONNON-IFRS FINANCIAL MEASURESIFRS FINANCIAL MEASURES Financial data have been prepared in conformity with IFRS,including the following measures:Operating expenses:Operating expenses:Operating expenses include:a)materi

272、als and services expenses,which are primarily costs related to independent contractors and vehicle operation;vehicle operation expenses,which primarily include fuel,repairs and maintenance,vehicle leasing costs,insurance,permits and operating supplies;b)personnel expenses;c)other operating expenses,

273、which are primarily composed of costs related to offices and terminals rent,taxes,heating,telecommunications,maintenance and security and other general administrative expenses;d)depreciation of property and equipment,depreciation of right-of-use assets,amortization of intangible assets and gain or l

274、oss on the sale of rolling stock and equipment,on derecognition of right-of use assets,on sale of business and on sale of land and buildings and assets held for sale;e)bargain purchase gain;and f)impairment of intangible assets.Operating income(loss)from continuing operations:Operating income(loss)f

275、rom continuing operations:Net income or loss from continuing operations before finance income and costs and income tax expense(recovery),as stated in the consolidated financial statements.1 Refer to the section“Non-IFRS financial measures”.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 2323 T

276、his MD&A includes references to certain non-IFRS financial measures as described below.These non-IFRS measures do not have any standardized meanings prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies.Accordingly,they should not be consider

277、ed in isolation,in addition to,not as a substitute for or superior to,measures of financial performance prepared in accordance with IFRS.The terms and definitions of IFRS and non-IFRS measures used in this MD&A and a reconciliation of each non-IFRS measure to the most directly comparable IFRS measur

278、e are provided below.Adjusted net income:Adjusted net income:Net income or loss excluding amortization of intangible assets related to business acquisitions,net change in the fair value and accretion expense of contingent considerations,net change in the fair value of derivatives,net foreign exchang

279、e gain or loss,impairment of intangible assets,bargain purchase gain,gain or loss on sale of land and buildings,assets held for sale and sale of business,and loss from discontinued operations,net of tax and U.S.Tax Reform.In presenting an adjusted net income and adjusted EPS,the Companys intent is t

280、o help provide an understanding of what would have been the net income and earnings per share in a context of significant business combinations and excluding specific impacts and to reflect earnings from a strictly operating perspective.The amortization of intangible assets related to business acqui

281、sitions comprises amortization expense of customer relationships,trademarks and non-compete agreements accounted for in business combinations and the income tax effects related to this amortization.Management also believes,in excluding amortization of intangible assets related to business acquisitio

282、ns,it provides more information on the amortization of intangible asset expense portion,net of tax,that will not have to be replaced to preserve the Companys ability to generate similar future cash flows.The Company excludes these items because they affect the comparability of its financial results

283、and could potentially distort the analysis of trends in its business performance.Excluding these items does not imply they are necessarily non-recurring.See reconciliation on page 8.Adjusted earnings per share(adjusted“EPS”)Adjusted earnings per share(adjusted“EPS”)-basicbasic:Adjusted net income di

284、vided by the weighted average number of common shares.Adjusted EPSAdjusted EPS -diluteddiluted:Adjusted net income divided by the weighted average number of diluted common shares.Adjusted EBITDA:Adjusted EBITDA:Net income or loss from continuing operations before finance income and costs,income tax

285、expense,depreciation,amortization,impairment of intangible assets,bargain purchase gain,and gain or loss on sale of land and buildings,assets held for sale and intangible assets.Segmented adjusted EBITDASegmented adjusted EBITDA refers to operating income(loss)from continuing operations before depre

286、ciation,amortization,impairment of intangible assets,bargain purchase gain,and gain or loss on sale of land and buildings,assets held for sale and intangible assets.Management believes adjusted EBITDA to be a useful supplemental measure.Adjusted EBITDA is provided to assist in determining the abilit

287、y of the Company to assess its performance.Consolidated adjusted EBITDAConsolidated adjusted EBITDA reconciliatireconciliation:on:(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2

288、019*Net income from continuing operationsNet income from continuing operations 86,32886,328 57,955 275,675275,675 244,225 Net finance costs 15,38215,382 15,552 5 53,9103,910 62,107 Income tax expense 15,41215,412 19,277 86,98286,982 76,536 Depreciation of property and equipment 43,75343,753 44,721 1

289、70,520170,520 168,720 Depreciation of right-of-use assets 21,61821,618 19,508 80,49680,496 77,326 Amortization of intangible assets 13,55713,557 12,757 48,21348,213 49,701 Gain on sale of business (306(306 )(306(306 )Bargain purchase gain (4,008(4,008 )(8,014)(Gain)loss on sale of land and buildings

290、 5 5 (8)6 6 (9)Gain on sale of assets held for sale (2,211(2,211 )(6,365)(11,899(11,899 )(21,571)Adjusted EBITDAAdjusted EBITDA 193,538193,538 163,397 699,589699,589 649,021 *Recasted for change in presentation currency from Canadian dollar to U.S.dollar.2020 Annual Report 2424 MANAGEMENTS DISCUSSIO

291、N AND ANALYSIS Segmented adjusted EBITDA reconciliation:Segmented adjusted EBITDA reconciliation:(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Package and CourierPackage an

292、d Courier Operating income 29,40129,401 22,680 78,75378,753 82,228 Depreciation and amortization 6,6266,626 6,553 25,35725,357 24,893 Gain on sale of land and buildings (1(1 )(Gain)loss on sale of assets held for sale (92(92 )62 (91(91 )(843)Adjusted EBITDA 35,93435,934 29,295 104,019104,019 106,278

293、 LessLess-ThanThan-TruckloadTruckload Operating income 24,46424,464 19,311 8787,950,950 82,230 Depreciation and amortization 12,61112,611 13,436 50,35450,354 52,920 Loss on sale of land and buildings 1 1 1 1 (Gain)loss on sale of assets held for sale 8 8 (1,478)5656 (8,509)Adjusted EBITDA 37,08437,0

294、84 31,269 138,361138,361 126,641 TruckloadTruckload Operating income 53,60453,604 46,417 206,346206,346 192,172 Depreciation and amortization 50,21250,212 48,987 188,979188,979 182,817 Gain on sale of business (306(306 )(306(306 )Gain on sale of land and buildings (8)(9)Gain on sale of assets held f

295、or sale (2,127(2,127 )(4,949)(11,864(11,864 )(12,339)Adjusted EBITDA 101,383101,383 90,447 383,155383,155 362,641 LogisticsLogistics Operating income 26,46226,462 14,216 84,45984,459 57,447 Depreciation and amortization 9,3429,342 7,717 33,42933,429 33,597 Bargain purchase gain (4,008(4,008 )(8,014)

296、Loss on sale of land and buildings 5 5 5 5 Adjusted EBITDA 35,80935,809 21,933 113,885113,885 83,030 CorporateCorporate Operating loss (16,809(16,809 )(9,840)(40,941(40,941 )(31,209)Depreciation and amortization 137137 293 1,1101,110 1,520 Loss on sale of assets held for sale 120 Adjusted EBITDA (16

297、,672(16,672 )(9,547)(39,831(39,831 )(29,569)*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.Adjusted EBITDA margin Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of revenue before fuel surcharge.Free cash flow:Free cash flow:Net cash from con

298、tinuing operating activities less additions to property and equipment plus proceeds from sale of property and equipment and assets held for sale.Management believes that this measure provides a benchmark to evaluate the performance of the Company in regard to its ability to meet capital requirements

299、.See reconciliation on page 19.FreFree cash flowe cash flow conversionconversion:Adjusted EBITDA less net capital expenditures(excluding property),divided by the adjusted EBITDA.TFI International MANAGEMENTS DISCUSSION AND ANALYSIS 2525 Free cash flowFree cash flow conversionconversion reconciliatio

300、n:reconciliation:(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended D December 31ecember 31 20202020 2019*20202020 2019*Net income from continuing operationsNet income from continuing operations 86,32886,328 57,955 275,675275,67

301、5 244,225 Net finance costs 15,38215,382 15,552 53,91053,910 62,107 Income tax expense 15,41215,412 19,277 86,98286,982 76,536 Depreciation of property and equipment 43,75343,753 44,721 170,520170,520 168,720 Depreciation of right-of-use assets 21,61821,618 19,508 80,49680,496 77,326 Amortization of

302、 intangible assets 13,55713,557 12,757 48,21348,213 49,701 Gain on sale of business (306(306 )(306(306 )Bargain purchase gain (4,008(4,008 )(8,014)(Gain)loss on sale of land and buildings 5 5 (8)6 6 (9)Gain on sale of assets held for sale (2,211(2,211 )(6,365)(11,899(11,899 )(21,571)Adjusted EBITDA

303、193,538193,538 163,397 699,589699,589 649,021 Additions to rolling stock and equipment (55,355(55,355 )(52,623)(123,483(123,483 )(223,965)Proceeds from sale of rolling stock and equipment 24,14424,144 20,654 52,71952,719 71,365 Adjusted EBITDA net of net rolling stock and equipment 162,327162,327 13

304、1,428 62628,8258,825 496,421 Free cash flow conversionFree cash flow conversion 83.983.9%80.4%89.989.9%76.5%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.Operating margin from continuing operations Operating margin from continuing operations is calculated as operat

305、ing income(loss)from continuing operations as a percentage of revenue before fuel surcharge.Adjusted operating ratio:Adjusted operating ratio:Operating expenses from continuing operations before impairment of intangible assets,gain on sale of business,bargain purchase gain,and gain or loss on sale o

306、f land and buildings,assets held for sale,and intangible assets(“Adjusted Adjusted operating expensesoperating expenses”),net of fuel surcharge revenue,divided by revenue before fuel surcharge.Although the adjusted operating ratio is not a recognized financial measure defined by IFRS,it is a widely

307、recognized measure in the transportation industry,which the Company believes provides a comparable benchmark for evaluating the Companys performance.Also,to facilitate the comparison of business level activity and operating costs between periods,the Company compares the revenue before fuel surcharge

308、(“revenue”)and reallocates the fuel surcharge revenue to materials and services expenses within operating expenses.Consolidated adjusted operating ratio reconciliation:Consolidated adjusted operating ratio reconciliation:(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended De

309、cember 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*Operating expenses 1,004,8841,004,884 896,248 3,364,5673,364,567 3,520,677 Gain on sale of business 306306 306306 Bargain purchase gain 4,0084,008 8,014 Gain(loss)on sale of land and building (5(5 )8 (6(6

310、)9 Gain on sale of assets held for sale 2,2112,211 6,365 11,89911,899 21,571 Adjusted operating expenses 1,007,3961,007,396 902,621 3,380,7743,380,774 3,550,271 Fuel surcharge revenue (73,859(73,859 )(105,315)(296,831(296,831 )(425,969)Adjusted operating expenses,net of fuel surcharge revenue 933,53

311、7933,537 797,306 3,083,9433,083,943 3,124,302 Revenue before fuel surcharge 1,048,1471,048,147 883,717 3,484,3033,484,303 3,477,576 Adjusted operating ratio 89.189.1%90.2%88.588.5%89.8%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.2020 Annual Report 2626 MANAGEMENT

312、S DISCUSSION AND ANALYSIS LessLess-ThanThan-Truckload and Truckload reportable segments adjusted operating ratio reconciliation and Truckload operating segments Truckload and Truckload reportable segments adjusted operating ratio reconciliation and Truckload operating segments r reconciliations:econ

313、ciliations:(unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*LessLess-ThanThan-TruckloadTruckload Total revenue 157,628157,628 175,319 589,235589,235 727,249 Total operating ex

314、penses 133,164133,164 156,008 501,285501,285 645,019 Operating income 24,46424,464 19,311 87,95087,950 82,230 Operating expenses 133,164133,164 156,008 501,285501,285 645,019 Gain(loss)on sale of land and buildings and assets held for sale (9(9 )1,478 (57(57 )8,509 Adjusted operating expenses 133,15

315、5133,155 157,486 501,228501,228 653,528 Fuel surcharge revenue (16,547(16,547 )(24,016)(66,384(66,384 )(100,030)Adjusted operating expenses,net of fuel surcharge revenue 116,608116,608 133,470 434,844434,844 553,498 Revenue before fuel surcharge 141,081141,081 151,303 522,851522,851 627,219 Adjusted

316、 operating ratio 82.782.7%88.2%83.283.2%88.2%TruckloadTruckload Total revenue 477,262477,262 469,798 1,748,3591,748,359 1,891,554 Total operating expenses 423,658423,658 423,381 1,542,0131,542,013 1,699,382 Operating income 53,60453,604 46,417 206,346206,346 192,172 Operating expenses 423,658423,658

317、 423,381 1,542,0131,542,013 1,699,382 Gain on sale of business 306306 306306 Gain on sale of land and buildings and assets held for sale 2,1272,127 4,957 11,86411,864 12,348 Adjusted operating expenses 426,091426,091 428,338 1,554,1831,554,183 1,711,730 Fuel surcharge revenue (39,127(39,127 )(57,038

318、)(163,522(163,522 )(233,757)Adjusted operating expenses,net of fuel surcharge revenue 386,964386,964 371,300 1,390,6611,390,661 1,477,973 Revenue before fuel surcharge 438,135438,135 412,760 1,584,8371,584,837 1,657,797 Adjusted operating ratio 88.388.3%90.0%87.787.7%89.2%Truckload Revenue before fu

319、el surcharge U.S.based Conventional TL 161,476161,476 156,678 632,590632,590 646,782 Canadian based Conventional TL 58,49758,497 56,668 206,418206,418 226,816 Specialized TL 219,093219,093 200,452 749,655749,655 791,087 Eliminations (931(931 )(1,038)(3,826(3,826 )(6,888)438,135438,135 412,760 1,584,

320、8371,584,837 1,657,797 Truckload Fuel surcharge revenue U.S.based Conventional TL 19,00619,006 26,720 81,22281,222 112,165 Canadian based Conventional TL 4,7984,798 7,677 19,40819,408 31,628 Specialized TL 15,24415,244 22,686 63,01863,018 90,650 Eliminations 7979 (45)(126(126 )(686)39,12739,127 57,0

321、38 163,522163,522 233,757 Truckload Operating income U.S.based Conventional TL 13,72213,722 11,931 51,85751,857 55,055 Canadian based Conventional TL 8,6738,673 8,001 28,33728,337 32,610 Specialized TL 31,20931,209 26,485 126,152126,152 104,507 53,60453,604 46,417 206,346206,346 192,172 TFI Internat

322、ional MANAGEMENTS DISCUSSION AND ANALYSIS 2727 (unaudited)(in thousands of U.S.dollars)Three months endedThree months ended December 31December 31 Years endedYears ended December 31December 31 20202020 2019*20202020 2019*U.S.based Conventional TLU.S.based Conventional TL Operating expenses*166,76016

323、6,760 171,467 661,955661,955 703,892 Gain on sale of land and buildings and assets held for sale 1,1031,103 Adjusted operating expenses 166,760166,760 171,467 663,058663,058 703,892 Fuel surcharge revenue (19,006(19,006 )(26,720)(81,222(81,222 )(112,165)Adjusted operating expenses,net of fuel surcha

324、rge revenue 147,754147,754 144,747 581,836581,836 591,727 Revenue before fuel surcharge 161,476161,476 156,678 632,590632,590 646,782 Adjusted operating ratio 91.591.5%92.4%92.092.0%91.5%Canadian based Conventional TLCanadian based Conventional TL Operating expenses*54,62254,622 56,344 197,489197,48

325、9 225,834 Gain on sale of land and buildings and assets held for sale 8 8 Adjusted operating expenses 54,62254,622 56,352 197,489197,489 225,842 Fuel surcharge revenue (4,798(4,798 )(7,677)(19,408(19,408 )(31,628)Adjusted operating expenses,net of fuel surcharge revenue 49,82449,824 48,675 178,08117

326、8,081 194,214 Revenue before fuel surcharge 58,49758,497 56,668 206,418206,418 226,816 Adjusted operating ratio 85.285.2%85.9%86.386.3%85.6%Specialized TLSpecialized TL Operating expenses*203,128203,128 196,653 686,521686,521 777,230 Gain on sale of business 306306 306306 Gain on sale of assets held

327、 for sale 2,1272,127 4,949 10,76110,761 12,340 Adjusted operating expenses 205,561205,561 201,602 697,588697,588 789,570 Fuel surcharge revenue (15,244(15,244 )(22,686)(63,018(63,018 )(90,650)Adjusted operating expenses,net of fuel surcharge revenue 190,317190,317 178,916 634,570634,570 698,920 Reve

328、nue before fuel surcharge 219,093219,093 200,452 749,655749,655 791,087 Adjusted operating ratio 86.986.9%89.3%84.684.6%88.3%*Recasted for change in presentation currency from Canadian dollar to U.S.dollar.*Operating expenses excluding intra TL eliminations RI RISKS AND UNCERTAINTIESSKS AND UNCERTAI

329、NTIES The Companys future results may be affected by a number of factors over many of which the Company has little or no control.The following discussion of risk factors contains forward-looking statements.The following issues,uncertainties and risks,among others,should be considered in evaluating t

330、he Companys business,prospects,financial condition,results of operations and cash flows.Competition.Competition.The Company faces growing competition from other transporters in Canada,the United States and Mexico.These factors,including the following,could impair the Companys ability to maintain or

331、improve its profitability and could have a material adverse effect on the Companys results of operations:the Company competes with many other transportation companies of varying sizes,including Canadian,U.S.and Mexican transportation companies;the Companys competitors may periodically reduce their f

332、reight rates to gain business,which may limit the Companys ability to maintain or increase freight rates or maintain growth in the Companys business;some of the Companys customers are other transportation companies or companies that also operate their own private trucking fleets,and they may decide

333、to transport more of their own freight or bundle transportation with other services;2020 Annual Report 2828 MANAGEMENTS DISCUSSION AND ANALYSIS some of the Companys customers may reduce the number of carriers they use by selecting so-called“core carriers”as approved service providers or by engaging dedicated providers,and in some instances the Company may not be selected;many customers periodicall