CALGARY, Alta. — Mullen Group Income Fund is entering 2008 with a renewed emphasis on growth.
During 2007 the Mullen Group focused its efforts on absorbing the 11 business units acquired during 2006 into the income fund. With that task accomplished, the fund will concentrate on creating unitholder value through growth.
To accomplish this strategic objective over the long-term, the fund will require access to capital. The Mullen’s current cash reserves of approximately $100 million will suffice in the short-term but, the access to new sources of capital will eventually be required by the group.
Mullen Group Income Fund has approved a $40 million capital expenditure budget for 2008 for its business units that need new capital to grow or sustaining capital to meet their ongoing customer needs.
Additional capital may be required later in the year to fund growth plans in certain business units, acquisitions that the fund may pursue and the acquisition of long-term assets such as land and buildings.
“Based upon our current outlook we believe the fund is positioned to generate moderate top-line and bottom-line growth in 2008 in spite of the challenging oil and gas drilling environment in Alberta,” stated Stephen H. Lockwood, president and co-CEO. “Several of our business units, most notably in the areas of infrastructure investment, oil sands development and production services, continue to experience growth and these are areas where we will concentrate our capital expenditures in 2008.”
The fund is also reevaluating the income trust structure as a business model and will investigate potential restructuring alternatives available well in advance of 2011 when the most punitive aspects of the federal government’s new Trust Tax Regime becomes effective.