TFI International Inc 6-K, filed Jul 29, 2020

TFI International Inc. (TFII)

6-K 2020-07-29 For: 2020-06-30

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TFI International Inc filed this 6-K on July 29, 2020.

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Exhibit Number		Exhibit Description
99.1		News Release
99.2		Management Discussion & Analysis for period ended June 30, 2020
99.3		Interim Financial Statements for period ended June 30, 2020
99.4		CEO Certification
99.5		CFO Certification


	TFI International Inc.

Date: July 27, 2020	By:	/s/ Josiane M. Langlois
		Name: Josiane M. Langlois
		Title: Vice-President, Legal Affairs & Corporate Secretary


*Financial highlights*	Quarters ended June 30		Six months ended June 30
*(in millions of dollars, except per share data)*	2020	2019*	2020	2019*
Total revenue	1,106.2	1,337.8	2,346.7	2,568.6
Revenue before fuel surcharge	1,025.3	1,183.9	2,137.9	2,281.3
Adjusted EBITDA¹	232.1	236.3	432.6	423.9
Operating income from continuing operations	131.5	149.0	249.9	253.9
Net cash from continuing operating activities	227.9	141.4	419.6	302.1
Adjusted net income¹	92.1	102.0	161.6	169.1
Adjusted EPS - diluted¹($)	1.04	1.18	1.85	1.94
Net income from continuing operations	69.7	100.2	145.4	165.3
EPS from continuing operations - diluted ($)	0.79	1.16	1.66	1.90
Weighted average number of shares ('000s)	87,411	84,183	86,063	84,676
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.
¹ This is a non-IFRS measure. For a reconciliation, please refer to the “Non-IFRS Financial Measures” section below.


SEGMENTED RESULTS
*(in millions of dollars)*	Quarters ended June 30								Six months ended June 30
	2020				2019	*			2020				2019	*
	$				$				$				$
Revenue¹
Package and Courier	139.5				158.5				279.0				305.5
Less-Than-Truckload	158.4				219.1				338.6				427.1
Truckload	471.2				570.4				1,004.7				1,097.5
Logistics	265.0				244.9				533.7				469.2
Eliminations	(8.8	)			(9.0	)			(18.1	)			(17.9	)
	1,025.3				1,183.9				2,137.9				2,281.3
			% of				% of				% of				% of
	$		Rev.¹		$		Rev.¹		$		Rev.¹		$		Rev.¹
Operating income (loss)
Package and Courier	22.6		16.2	%	29.9		18.9	%	38.1		13.7	%	50.9		16.7	%
Less-Than-Truckload	33.4		21.1	%	30.3		13.8	%	51.1		15.1	%	57.9		13.6	%
Truckload	69.5		14.8	%	67.2		11.8	%	132.5		13.2	%	118.0		10.8	%
Logistics	22.7		8.6	%	28.7		11.7	%	48.6		9.1	%	43.8		9.3	%
Corporate	(16.8	)			(7.1	)			(20.4	)			(16.7	)
	131.5		12.8	%	149.0		12.6	%	249.9		11.7	%	253.9		11.1	%
Note: due to rounding, totals may differ slightly from the sum.
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.
¹ Revenue before fuel surcharge.


*Adjusted EBITDA*	Quarters ended June 30		Six months ended June 30
*(unaudited, in millions of dollars)*	2020	2019*	2020	2019*
Net income from continuing operations	69.7	100.2	145.4	165.3
Net finance costs	17.6	21.5	36.8	40.6
Income tax expense	44.2	27.3	67.7	48.0
Depreciation of property and equipment	58.1	55.8	115.2	108.2
Depreciation of right-of-use assets	27.3	25.9	52.9	50.5
Amortization of intangible assets	15.4	16.5	31.0	32.3
Bargain purchase gain	-	(10.8)	(5.6)	(10.8)
Gain on sale of land and buildings and assets held for sale	(0.1)	(0.1)	(10.8)	(10.2)
Adjusted EBITDA	232.1	236.3	432.6	423.9
Note: due to rounding, totals may differ slightly from the sum.
* Recasted for change in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.


*Adjusted net income*	Quarters ended		Six months ended
*(unaudited, in millions of dollars, except per share data)*		June 30		June 30
	2020	2019	2020	2019
Net income	69.7	87.7	145.4	152.8
Amortization of intangible assets related to business acquisitions, net of tax	10.9	11.8	22.0	23.1
Net change in fair value and accretion expense of contingent considerations, net of tax	0.0	0.0	0.1	0.1
Net change in fair value of derivatives, net of tax	(0.2)	0.0	0.2	-
Net foreign exchange (gain) loss, net of tax	0.0	0.7	(1.2)	0.2
Bargain purchase gain	-	(10.8)	(5.6)	(10.8)
Gain on sale of land and buildings and assets held for sale, net of tax	(0.2)	(0.0)	(9.4)	(8.8)
Net loss from discontinued operations	-	12.5	-	12.5
U.S. Tax Reform	11.9	-	10.1	-
Adjusted net income	92.1	102.0	161.6	169.1
Adjusted earnings per share - basic	1.05	1.21	1.88	2.00
Adjusted earnings per share - diluted	1.04	1.18	1.85	1.94
Note: due to rounding, totals may differ slightly from the sum.


Note to readers:	Unaudited condensed consolidated interim financial statements and Management’s Discussion & Analysis are available on TFI International’s website at www.tfiintl.com.


CONTENTS
GENERAL INFORMATION	2
FORWARD-LOOKING STATEMENTS	2
SELECTED FINANCIAL DATA AND HIGHLIGHTS	3
ABOUT TFI INTERNATIONAL	4
CONSOLIDATED RESULTS	4
SEGMENTED RESULTS	8
LIQUIDITY AND CAPITAL RESOURCES	14
OUTLOOK	17
SUMMARY OF EIGHT MOST RECENT QUARTERLY RESULTS	18
NON-IFRS FINANCIAL MEASURES	18
RISKS AND UNCERTAINTIES	22
CRITICAL ACCOUNTING POLICIES AND ESTIMATES	35
CHANGES IN ACCOUNTING POLICIES	35
CONTROLS AND PROCEDURES	36


SELECTED FINANCIAL DATA AND HIGHLIGHTS
*(unaudited)*		Three months ended					Six months ended
*(in thousands of dollars, except per share data)*				June 30					June 30
	2020	2019	*	2018	**	2020	2019	*	2018	**
Revenue before fuel surcharge	1,025,284	1,183,897		1,156,864		2,137,940	2,281,333		2,218,478
Fuel surcharge	80,933	153,898		160,813		208,759	287,279		295,682
Total revenue	1,106,217	1,337,795		1,317,677		2,346,699	2,568,612		2,514,160
Adjusted EBITDA¹	232,105	236,329		186,681		432,627	423,885		315,655
Operating income from continuing operations	131,469	148,988		121,403		249,930	253,905		196,660
Net income	69,655	87,711		80,396		145,415	152,814		128,553
Net income from continuing operations	69,655	100,189		80,396		145,415	165,292		128,553
Adjusted net income¹	92,055	101,973		89,889		161,641	169,097		140,333
Net cash from continuing operating activities	227,867	141,356		145,270		419,612	302,054		203,098
Free cash flow¹	214,701	87,123		97,013		395,849	230,030		149,503
Per share data
EPS – diluted	0.79	1.01		0.89		1.66	1.76		1.42
EPS from continuing operations - diluted	0.79	1.16		0.89		1.66	1.90		1.42
Adjusted EPS – diluted¹	1.04	1.18		0.99		1.85	1.94		1.54
Dividends	0.26	0.24		0.21		0.52	0.48		0.42
As a percentage of revenue before fuel surcharge
Adjusted EBITDA margin¹	22.6%	20.0%		16.1%		20.2%	18.6%		14.2%
Depreciation of property and equipment	5.7%	4.7%		4.2%		5.4%	4.7%		4.3%
Depreciation of right-of-use assets	2.7%	2.2%		-		2.5%	2.2%		-
Amortization of intangible assets	1.5%	1.4%		1.3%		1.4%	1.4%		1.4%
Operating margin¹	12.8%	12.6%		10.5%		11.7%	11.1%		8.9%
Adjusted operating ratio¹	87.2%	88.3%		89.5%		89.1%	89.8%		91.5%
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.
** The current period results include the impacts from the adoption of IFRS 16 Leases as discussed in note 3 of the 2019 audited consolidated financial statements. As is permitted with this new standard, comparative information has not been restated and, therefore, may not be comparable.


Revenue by Top Customers' Industry
(68% of total revenue)
Retail	26%
Manufactured Goods	16%
Building Materials	8%
Metals & Mining	8%
Automotive	7%
Food & Beverage	7%
Services	7%
Chemicals & Explosives	5%
Forest Products	5%
Energy	3%
Waste Management	2%
Maritime Containers	1%
Others	5%
	(For the six-months ended June 30, 2020)


Finance income and costs
*(unaudited)*	Three months ended				Six months ended
*(in thousands of dollars)*			June 30				June 30
Finance costs (income)	2020		2019	*	2020		2019	*
Interest expense on long-term debt	12,025		14,609		27,474		28,652
Interest expense on lease liabilities	4,229		4,673		8,496		9,401
Interest income and accretion on promissory note	(255	)	(749	)	(857	)	(1,455	)
Net change in fair value and accretion expense of contingent considerations	41		54		109		137
Net foreign exchange gain	5		973		(1,645	)	245
Net change in fair value of foreign exchange derivatives	-		18		-		-
Net change in fair value of interest rate derivatives	(332	)	-		336		-
Others	1,856		1,899		2,858		3,623
Net finance costs	17,569		21,477		36,771		40,603
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.


Net income and adjusted net income
*(unaudited)*	Three months ended				Six months ended
*(in thousands of dollars, except per share data)*			June 30				June 30
	2020		2019		2020		2019
Net income	69,655		87,711		145,415		152,814
Amortization of intangible assets related to business acquisitions, net of tax	10,935		11,808		21,993		23,063
Net change in fair value and accretion expense of contingent considerations, net of tax	30		39		80		100
Net change in fair value of derivatives, net of tax	(244	)	13		247		-
Net foreign exchange (gain) loss, net of tax	4		713		(1,209	)	180
Bargain purchase gain	-		(10,787	)	(5,584	)	(10,787	)
Gain on sale of land and buildings and assets held for sale, net of tax	(196	)	(2	)	(9,433	)	(8,751	)
Net loss from discontinued operations	-		12,478		-		12,478
U.S. Tax Reform	11,871		-		10,132		-
Adjusted net income¹	92,055		101,973		161,641		169,097
Adjusted EPS – basic¹	1.05		1.21		1.88		2.00
Adjusted EPS – diluted¹	1.04		1.18		1.85		1.94


Selected segmented financial information
*(unaudited)*	Package	Less-
*(in thousands of dollars)*	and	Than-
	Courier	Truckload		Truckload	Logistics	Corporate Eliminations				Total
Three months ended June 30, 2020
Revenue before fuel surcharge¹	139,503	158,406		471,218	264,959	-		(8,802	)	1,025,284
% of total revenue²	14%	16%		46%	24%					100%
Adjusted EBITDA	31,155	51,144		131,900	34,409	(16,503	)	-		232,105
Adjusted EBITDA margin³	22.3%	32.3%		28.0%	13.0%					22.6%
Operating income (loss)	22,602	33,419		69,524	22,683	(16,759	)	-		131,469
Operating margin³	16.2%	21.1%		14.8%	8.6%					12.8%
Net capital expenditures excluding property⁴	4,864	(140	)	8,479	124	35				13,362
Three months ended June 30, 2019*
Revenue before fuel surcharge¹	158,530	219,075		570,358	244,924	-		(8,990	)	1,183,897
% of total revenue²	13%	19%		49%	19%					100%
Adjusted EBITDA	37,804	48,016		127,949	29,473	(6,913	)	-		236,329
Adjusted EBITDA margin³	23.8%	21.9%		22.4%	12.0%					20.0%
Operating income (loss)	29,931	30,268		67,241	28,658	(7,110	)	-		148,988
Operating margin³	18.9%	13.8%		11.8%	11.7%					12.6%
Net capital expenditures excluding property ⁴	2,163	6,495		44,323	552	292				53,825
Six months ended June 30, 2020
Revenue before fuel surcharge¹	279,011	338,600		1,004,706	533,726	-		(18,103	)	2,137,940
% of total revenue²	13%	16%		47%	24%					100%
Adjusted EBITDA	55,023	85,837		246,466	65,093	(19,792	)	-		432,627
Adjusted EBITDA margin³	19.7%	25.4%		24.5%	12.2%					20.2%
Operating income (loss)	38,106	51,100		132,528	48,640	(20,444	)	-		249,930
Operating margin³	13.7%	15.1%		13.2%	9.1%					11.7%
Total assets less intangibles assets	237,814	515,009		1,546,894	209,989	42,513				2,552,219
Net capital expenditures excluding property⁴	16,115	6,889		13,296	260	73				36,633
Six months ended June 30, 2019*
Revenue before fuel surcharge¹	305,472	427,061		1,097,505	469,199	-		(17,904	)	2,281,333
% of total revenue²	13%	19%		49%	19%					100%
Adjusted EBITDA	66,838	83,142		234,420	55,285	(15,800	)	-		423,885
Adjusted EBITDA margin³	21.9%	19.5%		21.4%	11.8%					18.6%
Operating income (loss)	50,931	57,910		117,985	43,822	(16,743	)	-		253,905
Operating margin³	16.7%	13.6%		10.8%	9.3%					11.1%
Total assets less intangibles assets	226,157	536,401		1,584,936	203,959	57,563				2,609,016
Net capital expenditures excluding property ⁴	5,511	12,432		67,889	606	707				87,145
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.



¹Includes intersegment revenue.
²Segment revenue including fuel and intersegment revenue to consolidated revenue including fuel and intersegment revenue.
³ As a percentage of revenue before fuel surcharge.
⁴ Additions to rolling stock and equipment, net of proceeds from sale of rolling stock and equipment and assets held for sale excluding property.


Package and Courier
*(unaudited)*			Three months ended June 30								Six months ended June 30
*(in thousands of dollars)*	2020		%		2019		%		2020		%		2019		%
Total revenue	151,389				181,501				310,761				348,229
Fuel surcharge	(11,886	)			(22,971	)			(31,750	)			(42,757	)
Revenue	139,503		100.0	%	158,530		100.0	%	279,011		100.0	%	305,472		100.0	%
Materials and services expenses (net of fuel surcharge)	62,686		44.9	%	65,161		41.1	%	124,373		44.6	%	128,694		42.1	%
Personnel expenses	38,333		27.5	%	47,233		29.8	%	83,878		30.1	%	92,409		30.3	%
Other operating expenses	7,286		5.2	%	8,388		5.3	%	15,714		5.6	%	17,777		5.8	%
Depreciation of property and equipment	3,927		2.8	%	3,236		2.0	%	7,494		2.7	%	6,380		2.1	%
Depreciation of right-of-use assets	4,309		3.1	%	4,345		2.7	%	8,787		3.1	%	8,964		2.9	%
Amortization of intangible assets	317		0.2	%	292		0.2	%	632		0.2	%	563		0.2	%
(Gain) loss on sale of rolling stock and equipment	49		0.0	%	(55	)	-0.0	%	32		0.0	%	(244	)	-0.1	%
Gain on derecognition of right-of-use assets	(6	)	-0.0	%	(1	)	-0.0	%	(9	)	-0.0	%	(2	)	-0.0	%
Loss on sale of land and buildings and assets held for sale	-		-		-		-		4		0.0	%	-		-
Operating income	22,602		16.2	%	29,931		18.9	%	38,106		13.7	%	50,931		16.7	%
Adjusted EBITDA	31,155		22.3	%	37,804		23.8	%	55,023		19.7	%	66,838		21.9	%


Operational data				Three months ended June 30									Six months ended June 30
*(unaudited)*		2020		2019		Variance		%			2020		2019		Variance		%
Revenue per pound (including fuel)	$	0.49	$	0.48	$	0.01		2.1	%	$	0.49	$	0.48	$	0.01		2.1	%
Revenue per pound (excluding fuel)	$	0.45	$	0.42	$	0.03		7.1	%	$	0.44	$	0.42	$	0.02		4.8	%
Revenue per shipment (including fuel)	$	8.46	$	8.36	$	0.10		1.2	%	$	8.43	$	8.27	$	0.16		1.9	%
Tonnage (in thousands of metric tons)		140		173		(33	)	-19.1	%		287		330		(43	)	-13.0	%
Shipments (in thousands)		17,890		21,708		(3,818	)	-17.6	%		36,864		42,101		(5,237	)	-12.4	%
Average weight per shipment (in lbs.)		17.25		17.56		(0.31	)	-1.8	%		17.16		17.28		(0.12	)	-0.7	%
Vehicle count, average		1,068		964		104		10.8	%		1,027		975		52		5.3	%
Weekly revenue per vehicle (incl. fuel, in thousands of dollars)	$	10.90	$	14.48	($	3.58	)	-24.7	%	$	11.64	$	13.74	($	2.10	)	-15.3	%


Operational data				Three months ended June 30									Six months ended June 30
*(unaudited)*		2020		2019		Variance		%			2020		2019		Variance		%
Adjusted operating ratio		78.9%		86.2%							84.9%		88.6%
Revenue per hundredweight (excluding fuel)	$	12.75	$	13.62	($	0.87	)	-6.4	%	$	13.02	$	13.22	($	0.20	)	-1.5	%
Revenue per shipment (including fuel)	$	329.65	$	316.36	$	13.29		4.2	%	$	331.09	$	318.08	$	13.01		4.1	%
Tonnage (in thousands of tons)		621		804		(183	)	-22.8	%		1,300		1,615		(315	)	-19.5	%
Shipments (in thousands)		536		806		(270	)	-33.5	%		1,163		1,559		(396	)	-25.4	%
Average weight per shipment (in lbs)		2,317		1,995		322		16.1	%		2,236		2,072		164		7.9	%
Average length of haul (in miles)		830		820		10		1.2	%		818		829		(11	)	-1.3	%
Vehicle count, average		909		1,019		(110	)	-10.8	%		943		1,025		(82	)	-8.0	%


	\| 10


Operational data *(unaudited)*		Three months ended June 30						Six months ended June 30
*(all Canadian dollars unless otherwise specified)*	2020	2019	Variance		%		2020	2019	Variance		%
U.S. based Conventional TL
Revenue (in thousands of U.S. dollars)	147,459	164,171	(16,712	)	-10.2	%	304,702	327,920	(23,218	)	-7.1	%
Adjusted operating ratio	91.8%	90.2%					92.6%	91.3%
Total mileage (in thousands)	83,849	89,975	(6,126	)	-6.8	%	171,479	178,563	(7,084	)	-4.0	%
Tractor count, average	2,897	2,966	(69	)	-2.3	%	2,918	2,984	(66	)	-2.2	%
Trailer count, average	10,675	10,962	(287	)	-2.6	%	10,727	10,999	(272	)	-2.5	%
Tractor age	2.1	2.0	0.1		5.0	%	2.1	2.0	0.1		5.0	%
Trailer age	6.7	7.0	(0.3	)	-4.3	%	6.7	7.0	(0.3	)	-4.3	%
Number of owner operators, average	462	376	86		22.9	%	450	387	63		16.3	%
Canadian based Conventional TL
Revenue (in thousands of dollars)	60,917	76,949	(16,032	)	-20.8	%	131,196	154,832	(23,636	)	-15.3	%
Adjusted operating ratio	86.5%	87.1%					87.2%	86.6%
Total mileage (in thousands)	20,852	26,151	(5,299	)	-20.3	%	44,247	51,687	(7,440	)	-14.4	%
Tractor count, average	572	718	(146	)	-20.3	%	606	719	(113	)	-15.7	%
Trailer count, average	2,778	2,953	(175	)	-5.9	%	2,806	2,942	(136	)	-4.6	%
Tractor age	2.2	2.7	(0.5	)	-18.5	%	2.2	2.7	(0.5	)	-18.5	%
Trailer age	5.2	5.6	(0.4	)	-7.1	%	5.2	5.6	(0.4	)	-7.1	%
Number of owner operators, average	286	348	(62	)	-17.8	%	297	351	(54	)	-15.4	%
Specialized TL
Revenue (in thousands of dollars)	207,225	275,963	(68,739	)	-24.9	%	460,435	511,926	(51,491	)	-10.1	%
Adjusted operating ratio	78.6%	87.0%					83.9%	88.6%
Tractor count, average	1,786	2,116	(330	)	-15.6	%	1,926	1,943	(17	)	-0.9	%
Trailer count, average	5,779	6,095	(316	)	-5.2	%	5,895	5,796	99		1.7	%
Tractor age	3.9	4.6	(0.7	)	-15.2	%	3.9	4.6	(0.7	)	-15.2	%
Trailer age	12.3	11.1	1.2		10.8	%	12.3	11.1	1.2		10.8	%
Number of owner operators, average	1,068	1,157	(89	)	-7.7	%	1,111	1,175	(64	)	-5.4	%


Less-Than-Truckload
*(unaudited)*			Three months ended June 30								Six months ended June 30
*(in thousands of dollars)*	2020		%		2019		%		2020		%		2019		%
Total revenue	176,692				254,989				385,055				495,886
Fuel surcharge	(18,286	)			(35,914	)			(46,455	)			(68,825	)
Revenue	158,406		100.0	%	219,075		100.0	%	338,600		100.0	%	427,061		100.0	%
Materials and services expenses (net of fuel surcharge)	75,897		47.9	%	109,717		50.1	%	165,067		48.8	%	218,179		51.1	%
Personnel expenses	27,078		17.1	%	54,836		25.0	%	75,991		22.4	%	109,222		25.6	%
Other operating expenses	4,681		3.0	%	7,184		3.3	%	12,286		3.6	%	17,242		4.0	%
Depreciation of property and equipment	6,897		4.4	%	6,205		2.8	%	13,362		3.9	%	12,251		2.9	%
Depreciation of right-of-use assets	7,979		5.0	%	8,787		4.0	%	15,740		4.6	%	16,878		4.0	%
Amortization of intangible assets	2,804		1.8	%	2,754		1.3	%	5,590		1.7	%	5,502		1.3	%
Gain on sale of rolling stock and equipment	(247	)	-0.2	%	(328	)	-0.1	%	(424	)	-0.1	%	(374	)	-0.1	%
Gain on derecognition of right-of-use assets	(147	)	-0.1	%	(350	)	-0.2	%	(157	)	-0.0	%	(350	)	-0.1	%
(Gain) loss on sale of assets held for sale	45		0.0	%	2		0.0	%	45		0.0	%	(9,399	)	-2.2	%
Operating income	33,419		21.1	%	30,268		13.8	%	51,100		15.1	%	57,910		13.6	%
Adjusted EBITDA	51,144		32.3	%	48,016		21.9	%	85,837		25.4	%	83,142		19.5	%


Sources and uses of cash
*(unaudited)*	Three months ended		Six months ended
*(in thousands of dollars)*		June 30		June 30
	2020	2019	2020	2019
Sources of cash:
Net cash from continuing operating activities	227,867	141,356	419,612	302,054
Proceeds from sale of property and equipment	13,811	23,515	24,617	40,307
Proceeds from sale of assets held for sale	1,837	1,121	16,700	18,714
Net variance in cash and bank indebtedness	118,018	14,689	-	929
Net proceeds from long-term debt	-	83,387	-	192,647
Net proceeds from share issuance	-	-	288,475	-
Others	20,741	11,170	46,810	15,829
Total sources	382,274	275,238	796,214	570,480
Uses of cash:
Purchases of property and equipment	27,267	69,773	60,547	120,657
Business combinations, net of cash acquired	60,024	78,186	74,670	180,637
Net variance in cash and bank indebtedness	-	-	17,374	-
Net repayment of long-term debt	235,749	-	492,494	-
Repayment of lease liabilities	26,938	23,995	53,165	47,747
Dividends paid	22,657	20,273	43,834	41,008
Repurchase of own shares	8,883	64,811	52,640	161,411
Net cash used in discontinued operations	-	14,461	-	14,461
Others	756	3,739	1,490	4,559
Total usage	382,274	275,238	796,214	570,480


Free cash flow
*(unaudited)*
*(in thousands of dollars)*	Three months ended				Six months ended
			June 30				June 30
	2020		2019		2020		2019
Net cash from continuing operating activities	227,867		141,356		419,612		302,054
Additions to property and equipment	(28,814	)	(78,869	)	(65,080	)	(131,045	)
Proceeds from sale of property and equipment	13,811		23,515		24,617		40,307
Proceeds from sale of assets held for sale	1,837		1,121		16,700		18,714
Free cash flow¹	214,701		87,123		395,849		230,030


Financial position
*(unaudited)*	As at	As at	As at
*(in thousands of dollars)*	June 30, 2020	December 31, 2019	December 31, 2018*
Total assets	4,564,972	4,557,255	4,049,960
Long-term debt	1,281,784	1,744,687	1,584,423
Lease liabilities	476,985	461,842	-
Shareholders' equity	1,896,550	1,505,689	1,576,854
* The current period figures include the impacts from the adoption of IFRS 16 Leases as discussed in note 3 of the 2019 audited consolidated financial statements. As is permitted with this new standard, comparative information has not been restated and, therefore, may not be comparable.


*(unaudited)*		Less than		1 to 3	3 to 5	After
*(in thousands of dollars)*	Total	1	year	years	years	5 years
Unsecured revolving facility – June 2023	136,770	-		136,770	-	-
Unsecured term loan – June 2021 & 2022	610,000	200,000		410,000	-	-
Unsecured debenture – December 2024	200,000	-		-	200,000	-
Unsecured senior notes – December 2026	205,140	-		-	-	205,140
Conditional sales contracts	134,295	40,734		69,053	23,171	1,337
Lease liabilities	476,985	110,871		173,205	96,760	96,149
Total contractual obligations	1,763,190	351,605		789,028	319,931	302,626


*Covenants*		*As at*
	*Requirements*	*June 30, 2020*
Funded debt-to- EBITDA ratio [ratio of total debt plus letters of credit and some other long-term liabilities to earnings before interest, income tax, depreciation and amortization (“EBITDA”), including last twelve months adjusted EBITDA from business acquisitions]¹	< 3.50	1.67
EBITDAR-to-interest and rent ratio [ratio of EBITDAR (EBITDA before rent and including last twelve months adjusted EBITDAR from business acquisitions) to interest and net rent expenses]	> 1.75	4.23
1 The Funded debt-to-EBITDA ratio is based on gross debt, the cash on hand of $12.1 million is excluded from the calculation of this measure.


*(unaudited) - (in millions of dollars, except per share data)*
	Q2’20	Q1’20	Q4’19*	Q3’19*	Q2’19*	Q1’19*	Q4’18**	Q3’18**
Total revenue	1,106.2	1,240.5	1,305.5	1,304.8	1,337.8	1,230.8	1,321.4	1,287.6
Adjusted EBITDA¹	232.1	200.5	215.7	221.7	236.3	187.6	180.7	190.0
Operating income from continuing operations	131.5	118.5	122.5	132.0	149.0	104.9	103.3	128.2
Net income	69.7	75.8	74.8	82.6	87.7	65.1	76.7	86.7
EPS – basic	0.80	0.89	0.92	1.00	1.04	0.76	0.88	0.99
EPS – diluted	0.79	0.88	0.90	0.98	1.01	0.74	0.85	0.96
Net income from continuing operations	69.7	75.8	76.5	82.6	100.2	65.1	76.7	86.7
EPS from continuing operations – basic	0.80	0.89	0.94	1.00	1.19	0.76	0.88	0.99
EPS from continuing operations – diluted	0.79	0.88	0.92	0.98	1.16	0.74	0.85	0.96
Adjusted net income¹	92.1	71.3	79.2	88.1	102.0	67.1	86.3	95.0
Adjusted EPS - diluted¹	1.04	0.83	0.95	1.04	1.18	0.77	0.96	1.05
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.
** The current period results include the impacts from the adoption of IFRS 16 Leases as discussed in note 3 of the 2019 audited consolidated financial statements. As is permitted with this new standard, comparative information has not been restated and, therefore, may not be comparable.

The differences between the quarters are mainly the result of seasonality (softer in Q1) and business acquisitions.


Segmented adjusted EBITDA reconciliation:
*(unaudited)*	Three months ended				Six months ended
*(in thousands of dollars)*			June 30				June 30
	2020		2019	*	2020		2019	*
Package and Courier
Operating income	22,602		29,931		38,106		50,931
Depreciation and amortization	8,553		7,873		16,913		15,907
Loss on sale of land and buildings	-		-		2		-
Loss on sale of assets held for sale	-		-		2		-
Adjusted EBITDA	31,155		37,804		55,023		66,838
Less-Than-Truckload
Operating income	33,419		30,268		51,100		57,910
Depreciation and amortization	17,680		17,746		34,692		34,631
(Gain) loss on sale of assets held for sale	45		2		45		(9,399	)
Adjusted EBITDA	51,144		48,016		85,837		83,142
Truckload
Operating income	69,524		67,241		132,528		117,985
Depreciation and amortization	62,546		60,784		124,769		117,207
Gain on sale of assets held for sale	(170	)	(76	)	(10,831	)	(772	)
Adjusted EBITDA	131,900		127,949		246,466		234,420
Logistics
Operating income	22,683		28,658		48,640		43,822
Depreciation and amortization	11,726		11,602		22,037		22,250
Bargain purchase gain	-		(10,787	)	(5,584	)	(10,787	)
Adjusted EBITDA	34,409		29,473		65,093		55,285
Corporate
Operating loss	(16,759	)	(7,110	)	(20,444	)	(16,743	)
Depreciation and amortization	256		197		652		943
Adjusted EBITDA	(16,503	)	(6,913	)	(19,792	)	(15,800	)
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.


Free cash flow conversion reconciliation:
*(unaudited)*	Three months ended				Six months ended
*(in thousands of dollars)*			June 30				June 30
	2020		2019	*	2020		2019	*
Net income	69,655		100,189		145,415		165,292
Net finance costs	17,569		21,477		36,771		40,603
Income tax expense	44,245		27,322		67,744		48,010
Depreciation of property and equipment	58,069		55,757		115,159		108,190
Depreciation of right-of-use assets	27,275		25,946		52,928		50,460
Amortization of intangible assets	15,417		16,499		30,976		32,288
Bargain purchase gain	-		(10,787	)	(5,584	)	(10,787	)
Loss on sale of land and buildings	-		-		2		-
Gain on sale of assets held for sale	(125	)	(74	)	(10,784	)	(10,171	)
Adjusted EBITDA	232,105		236,329		432,627		423,885
Additions to rolling stock and equipment	(27,474	)	(77,548	)	(61,706	)	(128,737	)
Proceeds from sale of rolling stock and equipment	14,112		23,723		25,073		41,592
Adjusted EBITDA net of net capex, excluding property	218,743		182,504		395,994		336,740
Free cash flow conversion	94.2%		77.2%		91.5%		79.4%
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.


Consolidated adjusted operating ratio reconciliation:
*(unaudited)*	Three months ended				Six months ended
*(in thousands of dollars)*			June 30				June 30
	2020		2019	*	2020		2019	*
Operating expenses	974,748		1,188,807		2,096,769		2,314,707
Bargain purchase gain	-		10,787		5,584		10,787
Loss on sale of land and building	-		-		(2	)	-
Gain on sale of assets held for sale	125		74		10,784		10,171
Adjusted operating expenses	974,873		1,199,668		2,113,135		2,335,665
Fuel surcharge revenue	(80,933	)	(153,898	)	(208,759	)	(287,279	)
Adjusted operating expenses, net of fuel surcharge revenue	893,940		1,045,770		1,904,376		2,048,386
Revenue before fuel surcharge	1,025,284		1,183,897		2,137,940		2,281,333
Adjusted operating ratio	87.2%		88.3%		89.1%		89.8%
* Recasted for changes in presentation, see note 20 in the unaudited condensed consolidated interim financial statements.


CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION	1
CONDENSED CONSOLIDATED STATEMENTS OF INCOME	2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY	4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	5
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS	6


TFI International Inc.	CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
	(UNAUDITED)


(in thousands of Canadian dollars)		As at	As at
		June 30,	December 31,
	Note	2020	2019
Assets
Cash and cash equivalents		12,125	-
Trade and other receivables		590,023	587,370
Inventoried supplies		11,282	13,844
Current taxes recoverable		-	17,158
Prepaid expenses		40,981	36,077
Derivative financial instruments	22	-	39
Assets held for sale		5,789	4,625
Other assets	11	-	24,814
Current assets		660,200	683,927
Property and equipment	8	1,422,788	1,461,707
Right-of-use assets	9	450,029	434,017
Intangible assets	10	2,012,753	1,954,902
Other assets	11	8,958	11,241
Deferred tax assets		10,244	11,461
Non-current assets		3,904,772	3,873,328
Total assets		4,564,972	4,557,255
Liabilities
Bank indebtedness		-	3,801
Trade and other payables		461,161	443,468
Current taxes payable		48,375	6,050
Provisions	14	18,803	23,721
Other financial liabilities		2,415	2,654
Derivative financial instruments	22	2,729	843
Long-term debt	12	240,598	53,647
Lease liabilities	13	110,871	99,133
Current liabilities		884,952	633,317
Long-term debt	12	1,041,186	1,691,040
Lease liabilities	13	366,114	362,709
Employee benefits		18,499	18,585
Provisions	14	35,023	29,251
Other financial liabilities		4,371	3,649
Derivative financial instruments	22	2,991	888
Deferred tax liabilities		315,286	312,127
Non-current liabilities		1,783,470	2,418,249
Total liabilities		2,668,422	3,051,566
Equity
Share capital	15	974,032	680,233
Contributed surplus		21,404	21,063
Accumulated other comprehensive income		57,244	24,473
Retained earnings		843,870	779,920
Equity attributable to owners of the Company		1,896,550	1,505,689
Contingencies, letters of credit and other commitments	23
Total liabilities and equity		4,564,972	4,557,255


TFI International Inc.	CONDENSED CONSOLIDATED STATEMENTS OF INCOME
	(UNAUDITED)


(In thousands of Canadian dollars, except per share amounts)		Three months		Three months		Six months		Six months
		ended		ended		ended		ended
	Note	June 30, 2020		June 30, 2019*		June 30, 2020		June 30, 2019*
Revenue		1,025,284		1,183,897		2,137,940		2,281,333
Fuel surcharge		80,933		153,898		208,759		287,279
Total revenue		1,106,217		1,337,795		2,346,699		2,568,612
Materials and services expenses	18	573,092		723,400		1,250,975		1,401,891
Personnel expenses	19	261,581		334,834		578,898		654,855
Other operating expenses		43,233		48,906		92,168		98,074
Depreciation of property and equipment		58,069		55,757		115,159		108,190
Depreciation of right-of-use assets		27,275		25,946		52,928		50,460
Amortization of intangible assets		15,417		16,499		30,976		32,288
Bargain purchase gain	5	-		(10,787	)	(5,584	)	(10,787	)
Gain on sale of rolling stock and equipment		(3,297	)	(4,988	)	(6,665	)	(9,400	)
Gain on derecognition of right-of-use assets		(497	)	(686	)	(1,304	)	(693	)
Loss on sale of land and buildings		-		-		2		-
Gain on sale of assets held for sale		(125	)	(74	)	(10,784	)	(10,171	)
Total operating expenses		974,748		1,188,807		2,096,769		2,314,707
Operating income		131,469		148,988		249,930		253,905
Finance (income) costs
Finance income	20	(587	)	(749	)	(2,502	)	(1,455	)
Finance costs	20	18,156		22,226		39,273		42,058
Net finance costs		17,569		21,477		36,771		40,603
Income before income tax		113,900		127,511		213,159		213,302
Income tax expense	21	44,245		27,322		67,744		48,010
Net income from continuing operations		69,655		100,189		145,415		165,292
Net loss from discontinued operations	6	-		(12,478	)	-		(12,478	)
Net income for the period attributable to owners of the Company		69,655		87,711		145,415		152,814
Earnings per share attributable to owners of the Company
Basic earnings per share	16	0.80		1.04		1.69		1.80
Diluted earnings per share	16	0.79		1.01		1.66		1.76
Earnings per share from continuing operations attributable to owners of the Company
Basic earnings per share	16	0.80		1.19		1.69		1.95
Diluted earnings per share	16	0.79		1.16		1.66		1.90


TFI International Inc.	CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
	(UNAUDITED)


TFI International Inc.	CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
	PERIODS ENDED JUNE 30, 2020 AND 2019 - (UNAUDITED)


(In thousands of Canadian dollars)										Accumulated
						Accumulated				foreign		Accumulated
						unrealized				currency		unrealized				Total equity
						loss on		Accumulated		translation		loss on				attributable
						employee		cash flow		differences		investment in				to owners
		Share		Contributed		benefit		hedge		and net invest-		equity		Retained		of the
	Note	capital		surplus		plans		gain		ment hedge		securities		earnings		Company
Balance as at December 31, 2019		680,233		21,063		(486	)	375		24,584		-		779,920		1,505,689
Net income for the period		-		-		-		-		-		-		145,415		145,415
Other comprehensive (loss) income for the period, net of tax		-		-		-		(3,716	)	36,487		-		-		32,771
Total comprehensive (loss) income for the period		-		-		-		(3,716	)	36,487		-		145,415		178,186
Share-based payment transactions	17	-		4,509		-		-		-		-		-		4,509
Stock options exercised	15, 17	22,005		(4,168	)	-		-		-		-		-		17,837
Issuance of shares	15	288,475		-		-		-		-		-		-		288,475
Dividends to owners of the Company		-		-		-		-		-		-		(45,506	)	(45,506	)
Repurchase of own shares	15	(16,681	)	-		-		-		-		-		(35,959	)	(52,640	)
Total transactions with owners, recorded directly in equity		293,799		341		-		-		-		-		(81,465	)	212,675
Balance as at June 30, 2020		974,032		21,404		(486	)	(3,341	)	61,071		-		843,870		1,896,550

Balance as at December 31, 2018		704,510		20,448		(528	)	10,210		60,971		(5,863	)	787,106		1,576,854
Adjustment on initial application of IFRS 16		-		-		-		-		-		-		(25,678	)	(25,678	)
Net income for the period		-		-		-		-		-		-		152,814		152,814
Other comprehensive (loss) income for the period, net of tax		-		-		-		(7,802	)	(39,429	)	1,326		-		(45,905	)
Realized loss on equity securities, net of tax		-		-		-		-		-		4,537		(4,537	)	-
Total comprehensive (loss) income for the period		-		-		-		(7,802	)	(39,429	)	5,863		148,277		106,909
Share-based payment transactions	17	-		4,270		-		-		-		-		-		4,270
Stock options exercised	15, 17	17,045		(3,911	)	-		-		-		-		-		13,134
Dividends to owners of the Company		-		-		-		-		-		-		(40,308	)	(40,308	)
Repurchase of own shares	15	(33,091	)	-		-		-		-		-		(128,320	)	(161,411	)
Net settlement of restricted share units	15, 17	15		(15	)	-		-		-		-		(44	)	(44	)
Total transactions with owners, recorded directly in equity		(16,031	)	344		-		-		-		-		(168,672	)	(184,359	)
Balance as at June 30, 2019		688,479		20,792		(528	)	2,408		21,542		-		741,033		1,473,726


TFI International Inc.	NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(Tabular amounts in thousands of Canadian dollars, unless otherwise noted.)	PERIODS ENDED JUNE 30, 2020 AND 2019 - (UNAUDITED)


	Package and Courier:	Pickup, transport and delivery of items across North America.
	Less-Than-Truckload:	Pickup, consolidation, transport and delivery of smaller loads.
	Truckload ^(a):	Full loads carried directly from the customer to the destination using a closed van or specialized equipment to meet customers’ specific needs. Includes expedited transportation, flatbed, tank, container and dedicated services.
	Logistics ^(b):	Asset-light logistics services, including brokerage, freight forwarding and transportation management, as well as small package parcel delivery.