##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTER ENDED MARCH 31, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR
15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR
THE TRANSITION PERIOD FROM                  to
 Commission file number:
 
 VITRAN CORPORATION INC.
 Ontario, Canada
(State of incorporation)
    
    (I.R.S. Employer
Identification No.)
 185 The West Mall, Suite 701, Toronto, Ontario, Canada, M9C 5L5
 
 þ o
  o þ o
 o þ
     1




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TABLE OF CONTENTS      Table of Contents  
 TABLE OF CONTENT
 Item
    
    
    
    PagePART I
    
    Financial Information1.
    
    Financial Statements
    
    
    32.
    
    Managements Discussion and Analysis
    
    
    133.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    194.
    
    Controls and Procedures
    
    
    20PART II
    
    Other Information1.
    
    Legal Proceedings
    
    
    202.
    
    Changes in Securities and Use of Proceeds
    
    
    203.
    
    Defaults Upon Senior Securities
    
    
    214.
    
    Submission of Matters to a Vote of Security Holders
    
    
    215.
    
    Other Information
    
    
    216.
    
    Exhibits and Reports on Form 8-K
    
    
    21
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##### Table of Contents



Part I. Financial Information
 
 Item 1: Financial Statements
 VITRAN CORPORATION INC.
 CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
 (In thousands of United States dollars except for per share amounts)
 Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Revenue
    
    $
    154,136
    
    
    $
    115,127Operating expenses
    
    
    128,456
    
    
    
    97,121Selling, general and administrative expenses
    
    
    15,099
    
    
    
    10,743Other expense (income)
    
    
    29
    
    
    
    (116
    )Depreciation and amortization expense
    
    
    4,945
    
    
    
    2,407Total operating expenses
    
    
    148,529
    
    
    
    110,155Income from operations before undernoted
    
    
    5,607
    
    
    
    4,972Interest expense, net
    
    
    2,064
    
    
    
    176Income from operations before income taxes
    
    
    3,543
    
    
    
    4,796Income taxes
    
    
    156
    
    
    
    1,173Net income before cumulative effect of
change in accounting principle
    
    
    3,387
    
    
    
    3,623Cumulative effect of change in accounting
principle
    
    
    
    
    
    
    141Net income
    
    $
    3,387
    
    
    $
    3,764Earnings per share:Basic  net income before cumulative
effect of change in accounting principle
    
    $
    0.25
    
    
    $
    0.29Basic  cumulative effect of change in
accounting principle
    
    
    
    
    
    
    0.01Basic   net income
    
    $
    0.25
    
    
    $
    0.30Diluted  net income before cumulative
effect of change in accounting principle
    
    
    0.25
    
    
    
    0.28Diluted  cumulative effect of change in
accounting principle
    
    
    
    
    
    
    0.01Diluted  net income
    
    $
    0.25
    
    
    $
    0.29Weighted average number of shares:Basic
    
    
    13,438,065
    
    
    
    12,652,075Diluted
    
    
    13,651,872
    
    
    
    12,934,751
 See accompanying notes to consolidated financial statements
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VITRAN CORPORATION INC.
 CONSOLIDATED BALANCE SHEETS
 (In thousands of United States dollars)
 Mar. 31, 2007
    
    
    Dec. 31, 2006(Unaudited)
    
    
    (Audited)AssetsCurrent assets:Cash and cash equivalents
    
    $
    1,543
    
    
    $
    1,454Accounts receivable
    
    
    73,061
    
    
    
    66,051Inventory, deposits and prepaid expenses
    
    
    10,409
    
    
    
    10,796Income and other taxes receivable
    
    
    2,885
    
    
    
    Deferred income taxes
    
    
    2,768
    
    
    
    1,72090,666
    
    
    
    80,021Property and equipment
    
    
    145,560
    
    
    
    145,129Intangible assets
    
    
    15,327
    
    
    
    15,888Goodwill (note 5)
    
    
    118,400
    
    
    
    117,146Other
    
    
    124
    
    
    
    150$
    370,077
    
    
    $
    358,334Liabilities and Shareholders EquityCurrent liabilities:Accounts payable and accrued liabilities
    
    $
    74,074
    
    
    $
    67,916Income and other taxes payable
    
    
    
    
    
    
    1,275Current portion of long-term debt
    
    
    15,758
    
    
    
    15,72489,832
    
    
    
    84,915Long-term debt
    
    
    92,536
    
    
    
    93,139Other
    
    
    1,928
    
    
    
    Deferred income taxes
    
    
    8,693
    
    
    
    6,983Shareholders equity:Common shares, no par value, unlimited authorized,
13,460,859 and 13,419,859 issued and outstanding at
March 31, 2007 and December 31, 2006, respectively
    
    
    77,040
    
    
    
    76,913Additional paid-in capital
    
    
    1,815
    
    
    
    1,607Retained earnings
    
    
    94,320
    
    
    
    90,933Accumulated other comprehensive income
    
    
    3,913
    
    
    
    3,844177,088
    
    
    
    173,297$
    370,077
    
    
    $
    358,334
  See accompanying notes to consolidated financial statements.
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VITRAN CORPORATION INC.
 CONSOLIDATED
STATEMENTS OF SHAREHOLDERS EQUITY(Unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    other
    
    
    TotalCommon shares
    
    
    Paid-in
    
    
    Retained
    
    
    comprehensive
    
    
    ShareholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    income
    
    
    EquityDecember 31, 2006
    
    
    13,419,859
    
    
    $
    76,913
    
    
    $
    1,607
    
    
    $
    90,933
    
    
    $
    3,844
    
    
    $
    173,297Shares issued upon
exercise of employee
stock options
    
    
    41,000
    
    
    
    127
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    127Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,387
    
    
    
    
    
    
    
    3,387Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    69
    
    
    
    69Share based compensation
    
    
    
    
    
    
    
    
    
    
    208
    
    
    
    
    
    
    
    
    
    
    
    208March 31, 2007
    
    
    13,460,859
    
    
    $
    77,040
    
    
    $
    1,815
    
    
    $
    94,320
    
    
    $
    3,913
    
    
    $
    177,088
 AccumulatedAdditional
    
    
    
    
    
    
    other
    
    
    TotalCommon shares
    
    
    Paid-in
    
    
    Retained
    
    
    comprehensive
    
    
    ShareholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    income
    
    
    EquityDecember 31, 2005
    
    
    12,647,636
    
    
    $
    63,604
    
    
    $
    956
    
    
    $
    71,553
    
    
    $
    3,689
    
    
    $
    139,802Shares issued upon
exercise of employee
stock options
    
    
    73,500
    
    
    
    321
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    321Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,764
    
    
    
    
    
    
    
    3,764Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (361
    )
    
    
    (361
    )Share based compensation
    
    
    
    
    
    
    
    
    
    
    190
    
    
    
    
    
    
    
    
    
    
    
    190Cumulative effect of
change in accounting
principle
    
    
    
    
    
    
    
    
    
    
    (141
    )
    
    
    
    
    
    
    
    
    
    
    (141
    )March 31, 2006
    
    
    12,721,136
    
    
    $
    63,925
    
    
    $
    1,005
    
    
    $
    75,317
    
    
    $
    3,328
    
    
    $
    143,575
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##### Table of Contents



VITRAN CORPORATION INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands of United States dollars)
 Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Cash provided by (used in):Operations:Net income
    
    $
    3,387
    
    
    $
    3,764Items not involving cash from operationsDepreciation and amortization expense
    
    
    4,945
    
    
    
    2,407Deferred income taxes
    
    
    967
    
    
    
    377Share-based compensation expense
    
    
    208
    
    
    
    190Loss (gain) on sale of property and equipment
    
    
    29
    
    
    
    (116
    )Cumulative effect of change in accounting principle
    
    
    
    
    
    
    (141
    )Change in non-cash working capital components
    
    
    (3,697
    )
    
    
    1,9555,839
    
    
    
    8,436Investments:Purchase of property and equipment
    
    
    (4,550
    )
    
    
    (1,878
    )Proceeds on sale of property and equipment
    
    
    71
    
    
    
    170Additional payment due to acquisition of subsidiary
    
    
    (538
    )
    
    
    Acquisition of business assets
    
    
    
    
    
    
    (2,251
    )(5,017
    )
    
    
    (3,959
    )Financing:Change in revolving credit facility
    
    
    3,284
    
    
    
    (2,985
    )Repayment of long-term debt
    
    
    (2,255
    )
    
    
    (1,321
    )Repayment of capital leases
    
    
    (1,640
    )
    
    
    Issue of common shares
upon exercise of stock options
    
    
    127
    
    
    
    321(484
    )
    
    
    (3,985
    )Effect of translation adjustment on cash
    
    
    (249
    )
    
    
    (114
    )Increase in cash position
    
    
    89
    
    
    
    378Cash position, beginning of period
    
    
    1,454
    
    
    
    14,592Cash position, end of period
    
    $
    1,543
    
    
    $
    14,970Change in non-cash working capital components:Accounts receivable
    
    $
    (7,010
    )
    
    $
    (2,346
    )Inventory, deposits and prepaid expenses
    
    
    387
    
    
    
    188Income and other taxes receivable/payable
    
    
    (4,525
    )
    
    
    (412
    )Other liabilities
    
    
    1,928
    
    
    
    Accounts payable and accrued liabilities
    
    
    5,523
    
    
    
    4,525$
    (3,697
    )
    
    $
    1,955
 See accompanying notes to consolidated financial statements.
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NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)
 (In thousands of United States dollars except for per share amounts)
 1. Accounting Policies
    2. New Accounting Pronouncements
  3. Foreign Currency Translation
     7




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4. Acquisition
   March 31, 2006Pro forma revenue
    
    $
    156,792Pro forma net income
    
    
    4,028Pro forma diluted earnings per share
    
    $
    0.30
 5. Goodwill
 GoodwillBalance at December 31, 2006
    
    $
    117,146Foreign exchange on CDN$denominated goodwill
    
    
    81Adjustment to goodwill (note 4)
    
    
    1,173Balance at March 31, 2007
    
    $
    118,400
 6. Income Taxes
    8




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7. Stock Option Plan
   2007Options granted
    
    
    115,000Risk-free interest rate
    
    
    4.20
    %Dividend yield
    
    
    Volatility factor of the future expected market price of the
Companys common shares
    
    
    31.76
    %Expected life of the options
    
    6 years
  8 Comprehensive income (loss)
   Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Net income
    
    $
    3,387
    
    
    $
    3,764Translation adjustment
    
    
    95
    
    
    
    (361
    )Interest rate swap
    
    
    (26
    )
    
    
    Other comprehensive income
    
    $
    69
    
    
    $
    (361
    )Comprehensive net income
    
    $
    3,456
    
    
    $
    3,403
 9. Computation of Earnings per Share
 Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Numerator:Net income
    
    $
    3,387
    
    
    $
    3,764Denominator:Basic weighted-average shares outstanding
    
    
    13,438,065
    
    
    
    12,652,075Dilutive stock options
    
    
    213,807
    
    
    
    282,676Dilutive weighted-average shares outstanding
    
    
    13,651,872
    
    
    
    12,934,751Basic earnings per share before cumulative
effect of a change in accounting principle
    
    $
    0.25
    
    
    $
    0.29Effect of a change in accounting principle
    
    
    
    
    
    
    0.01Basic earnings per share
    
    $
    0.25
    
    
    $
    0.30
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Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Diluted earnings per share before
cumulative effect of a change in
accounting principle
    
    $
    0.25
    
    
    $
    0.28Effect of a change in accounting principle
    
    
    
    
    
    
    0.01Diluted earnings per share
    
    $
    0.25
    
    
    $
    0.29
  10. Contingent Liabilities
  11. Risk Management Activities
  12. Segmented Information
 Three months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    
    ConsolidatedMar. 31, 2007
    
    truckload
    
    
    Logistics
    
    
    Truckload
    
    
    Total
    
    
    and Other
    
    
    TotalsRevenue
    
    $
    136,157
    
    
    $
    9,663
    
    
    $
    8,316
    
    
    $
    154,136
    
    
    $
    
    
    
    $
    154,136Operating, selling, general and
administrative expenses
    
    
    125,326
    
    
    
    9,104
    
    
    
    7,776
    
    
    
    142,206
    
    
    
    1,349
    
    
    
    143,555Other income
    
    
    24
    
    
    
    
    
    
    
    5
    
    
    
    29
    
    
    
    
    
    
    
    29Depreciation and amortization
    
    
    4,577
    
    
    
    119
    
    
    
    240
    
    
    
    4,936
    
    
    
    9
    
    
    
    4,945Income (loss) from operations
    
    $
    6,230
    
    
    $
    440
    
    
    $
    295
    
    
    $
    6,965
    
    
    $
    (1,358
    )
    
    
    5,607Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,064Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    156Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    3,387
 Three months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    
    ConsolidatedMar. 31, 2006
    
    truckload
    
    
    Logistics
    
    
    Truckload
    
    
    Total
    
    
    and Other
    
    
    TotalsRevenue
    
    $
    97,423
    
    
    $
    9,412
    
    
    $
    8,292
    
    
    $
    115,127
    
    
    $
    
    
    
    $
    115,127Operating, selling, general and
administrative expenses
    
    
    90,347
    
    
    
    8,814
    
    
    
    7,694
    
    
    
    106,855
    
    
    
    1,009
    
    
    
    107,864Other income
    
    
    (116
    )
    
    
    
    
    
    
    
    
    
    
    (116
    )
    
    
    
    
    
    
    (116
    )Depreciation and amortization
    
    
    2,124
    
    
    
    84
    
    
    
    188
    
    
    
    2,396
    
    
    
    11
    
    
    
    2,407Income (loss) from operations
    
    $
    5,068
    
    
    $
    514
    
    
    $
    410
    
    
    $
    5,992
    
    
    $
    (1,020
    )
    
    
    4,972Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    176Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,173Net income before effect of a
change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,623Effect of change in accounting
principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    141Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    3,764
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13. United States and Canadian accounting policy differences:
  (a)
    
    Consolidated reconciliation of net income and shareholders equity
  Net income
    
    
    Shareholders equity2007
    
    
    2006
    
    
    2007
    
    
    2006Balance as at March 31, based on United States GAAP
    
    $
    3,387
    
    
    $
    3,764
    
    
    $
    177,088
    
    
    $
    143,575Effect of a change in accounting principle (i)
    
    
    
    
    
    
    (141
    )
    
    
    (141
    )
    
    
    (141
    )Foreign exchange adjustment (ii)
    
    
    (83
    )
    
    
    
    
    
    
    775
    
    
    
    858Unrealized foreign exchange loss on derivative instrument
    
    
    
    
    
    
    
    
    
    
    (101
    )
    
    
    (101
    )Accumulated other comprehensive income adjustment (ii)
    
    
    
    
    
    
    
    
    
    
    (674
    )
    
    
    (757
    )Balance as at March 31, based on Canadian GAAP
    
    $
    3,304
    
    
    $
    3,623
    
    
    $
    176,947
    
    
    $
    143,434
 (i)
    
    The adoption of SFAS 123(R)  Share-Based Payments only applies to United States GAAP.
Therefore, the effect of a change in accounting principle does not impact Canadian GAAP
net income or shareholders equity.(ii)
    
    The Company had a foreign exchange loss of $0.1 million that did not represent a
substantially complete liquidation of a foreign operation in the current period. In
previous years, the Company had foreign exchange gains of $0.9 million that did not
represent a substantially complete liquidation of a foreign operation. Under Canadian GAAP
these gains and losses were recognized upon the transfer into income of the related
cumulative translation adjustment. Under United States GAAP, there is no reduction of the
cumulative translation adjustment account. Retained earnings under Canadian GAAP is
increased $0.8 million with a corresponding decrease to the cumulative translation
adjustment included in accumulated other comprehensive income.
 Earnings per share
 Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Earnings per share underCanadian GAAPBasic
    
    $
    0.25
    
    
    $
    0.29Diluted
    
    $
    0.24
    
    
    $
    0.28
 Three months
    
    
    Three monthsEnded
    
    
    EndedMar. 31, 2007
    
    
    Mar. 31, 2006Weighted average number of shares:Basic
    
    
    13,438,065
    
    
    
    12,652,075Potential exercise of stock options
    
    
    213,807
    
    
    
    282,676Diluted
    
    
    13,651,872
    
    
    
    12,934,751
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(b)
    
    Derivative accountingPreviously under Canadian GAAP, gains and losses on derivatives that are designated as hedges
and that manage the underlying risks of anticipated transactions are not recorded until the
underlying hedged item is recorded in net income and hedge ineffectiveness is not recorded until
settlement. On January 1, 2007 the Company adopted CICA 3865, Hedges, in accordance with the
transitional provisions. Under the transitional provision any hedging relationships that existed
and satisfy all the conditions of CICA 3865 are adjusted to the carrying amounts that would have
resulted had CICA 3865 always been applied. Based on the transitional provision there is no longer
a difference in accounting for derivatives for the Company between United States and Canadian GAAP.On January 1, 2007, the Company adopted CICA 3855, Financial Instruments  Recognition and
Measurement. Management evaluated the effect of the standard on the consolidated financial
statements and concluded that the Company does not have a difference between United States and
Canadian GAAP upon adoption of the standard.(c)
    
    Comprehensive incomeOn January 1, 2007 the Company adopted CICA 1530, Comprehensive Income, in accordance with the
appropriate provisions of the standard. The Company reports comprehensive income as part of its
United States GAAP reporting, therefore, the adoption of this standard eliminates this difference
between United States and Canadian GAAP.
 14. Comparative figures
  12




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Item 2. Managements Discussion and Analysis of Results of Operation
 This MD&A and the documents incorporated by reference contains forward-looking statements
within the meaning of the United States Private Securities Litigation Reform Act of 1995 and
applicable Canadian securities laws concerning Vitrans business, operations, and financial
performance and condition.
 Forward-looking statements may be generally identifiable by use of the words believe,
anticipate, intend, estimate, expect, project, may, plans, continue, will,
focus, should, endeavor or the negative of these words or other variation on these words or
comparable terminology. These forward-looking statements are based on current expectations and are
subject to uncertainty and changes in circumstances that may cause actual results to differ
materially from those expressed or implied by such forward-looking statements.
 The MD&A and the documents incorporated by reference herein contain forward-looking statements
regarding, but not limited to, the following:
 
    
    the Companys objective to expand or acquire a less-than-truckload operation, in a new
regional market;
    
    the Companys objective to achieve profitable revenue growth in the less-than-truckload segment;
    
    the Companys objective to complete information technology initiatives;
    
    the Companys intention to achieve above-average transborder and inter-regional growth rates;
    
    the Companys intention to add clients in the second and third quarter that will improve
revenue and income from operations within the Logistics segment;
    
    the Companys intention to purchase a specified level of capital assets and to finance
such acquisitions with cash flow from operations and, if necessary, from the Companys
unused credit facilities.
 Such forward-looking statements involve known and unknown risks, uncertainties and other
factors that may cause Vitrans actual results, performance or achievements to differ materially
from any future results, performance or achievements expressed or implied by such forward-looking
statements. Factors that may cause such differences include but are not limited to technological
change, increase in fuel costs, regulatory change, changes in tax legislation, the general health
of the economy, changes in labor relations, geographic expansion, capital requirements,
availability of financing, claims and insurance costs, environmental hazards, availability of
qualified drivers and competitive factors. More detailed information about these and other factors
is included in the MD&A. Many of these factors are beyond the Companys control; therefore, future
events may vary substantially from what the Company currently foresees. You should not place undue
reliance on such forward-looking statements. Vitran Corporation Inc. does not assume the
obligation to revise or update these forward-looking statements after the date of this document or
to revise them to reflect the occurrence of future unanticipated events, except as may be required
under applicable securities laws.
 Unless otherwise indicated all dollar references herein are in U.S. dollars. The Companys
Annual Report on Form 10-K, as well as all the Companys other required filings, may be obtained
from the Company at www.vitran.com or from www.sedar.com or from www.sec.gov/edgar.shtml. This MD&A
and the documents incorporated by reference contain forward-looking statements within the meaning
of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian
securities laws concerning Vitrans business, operations, and financial performance and condition.
 13




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##### Table of Contents



OVERVIEW
   CONSOLIDATED RESULTS
  For the three months ended March 31,(in thousands)
    
    2007
    
    
    2006
    
    
    2007 vs 2006Revenue
    
    $
    154,136
    
    
    $
    115,127
    
    
    
    33.9
    %Operating expenses
    
    
    128,456
    
    
    
    97,121
    
    
    
    32.3
    %SG&A expenses
    
    
    15,099
    
    
    
    10,743
    
    
    
    40.5
    %Other expense (income)
    
    
    29
    
    
    
    (116
    )
    
    
    (125.0
    %)Depreciation and amortization
    
    
    4,945
    
    
    
    2,407
    
    
    
    105.4
    %Income from operations
    
    
    5,607
    
    
    
    4,972
    
    
    
    12.8
    %Interest expense, net
    
    
    2,064
    
    
    
    176
    
    
    
    1,072.7
    %Net income
    
    $
    3,387
    
    
    $
    3,764
    
    
    
    (10.0
    %)Earnings per share:Basic  net income
    
    $
    0.25
    
    
    $
    0.30Diluted  net income
    
    $
    0.25
    
    
    $
    0.29Operating Ratio(1)
    
    
    96.4
    %
    
    
    95.7
    %
   14




---



##### Table of Contents



SEGMENTED RESULTS
 Less-Than-Truckload (LTL)
  For the three months ended March 31,(in thousands)
    
    2007
    
    
    2006
    
    
    2007 vs 2006Revenue
    
    $
    136,157
    
    
    $
    97,423
    
    
    
    39.8
    %Income from operations
    
    
    6,230
    
    
    
    5,068
    
    
    
    22.9
    %Operating ratio
    
    
    95.4
    %
    
    
    94.8
    %Number of shipments (2)
    
    
    993,376
    
    
    
    664,630
    
    
    
    49.5
    %Weight (000s of lbs) (3)
    
    
    1,467,846
    
    
    
    1,043,580
    
    
    
    40.7
    %Revenue per shipment (4)
    
    $
    137.06
    
    
    $
    146.58
    
    
    
    (6.5
    %)Revenue per hundredweight (5)
    
    $
    9.28
    
    
    $
    9.34
    
    
    
    (0.6
    %)
 15




---



##### Table of Contents



Logistics
  For the three months ended March 31,(in thousands)
    
    2007
    
    
    2006
    
    
    2007 vs 2006Revenue
    
    $
    9,663
    
    
    $
    9,412
    
    
    
    2.7
    %Income from operations
    
    
    440
    
    
    
    514
    
    
    
    (14.4
    %)Operating ratio
    
    
    95.4
    %
    
    
    94.5
    %
  Truckload
  For the three months ended March 31,(in thousands)
    
    2007
    
    
    2006
    
    
    2007 vs 2006Revenue
    
    $
    8,316
    
    
    $
    8,292
    
    
    
    0.3
    %Income from operations
    
    
    295
    
    
    
    410
    
    
    
    (28.0
    %)Operating ratio
    
    
    96.5
    %
    
    
    95.1
    %
 (6)
 LIQUIDITY AND CAPITAL RESOURCES
  16




---



##### Table of Contents



For the three months ended March 31,(in thousands of dollars)
    
    2007
    
    
    2006Real estate and buildings
    
    $
    3,247
    
    
    $
    11Tractors
    
    
    
    
    
    
    284Trailing fleet
    
    
    969
    
    
    
    818Information technology
    
    
    169
    
    
    
    359Leasehold improvements
    
    
    18
    
    
    
    19Other equipment
    
    
    147
    
    
    
    387Total
    
    $
    4,550
    
    
    $
    1,878
  off-balance
sheet
  (in thousands of dollars)

    
    
    
    
    
    Payments due by periodContractual Obligations
    
    Total
    
    
    2007
    
    
    2008 & 2009
    
    
    2010 & 2011
    
    
    ThereafterLong-term debt (LIBOR 4.74% to 7.23%)
    
    $
    79,675
    
    
    $
    6,765
    
    
    $
    72,106
    
    
    $
    804
    
    
    $
    NilRevolving credit facilities
    
    
    10,541
    
    Nil
    
    
    
    10,541
    
    
    Nil
    
    
    NilCapital lease obligations
    
    
    18,078
    
    
    
    5,064
    
    
    
    9,329
    
    
    
    2,933
    
    
    
    752Amount due to vendors of acquisitions
    
    
    8,069
    
    
    
    8,069
    
    
    Nil
    
    
    Nil
    
    
    NilSub-total
    
    
    116,363
    
    
    
    19,898
    
    
    
    91,976
    
    
    
    3,737
    
    
    
    752Operating leases
    
    
    34,753
    
    
    
    10,056
    
    
    
    15,984
    
    
    
    6,527
    
    
    
    2,186Total Contractual Obligations
    
    $
    151,116
    
    
    $
    29,954
    
    
    $
    107,960
    
    
    $
    10,264
    
    
    $
    2,938
 17




---



##### Table of Contents



OUTLOOK
    QUARTERLY RESULTS
 U.S. GAAP(thousands of dollars
    
    2007
    
    
    2006
    
    
    2006
    
    
    2006
    
    
    2006
    
    
    2005
    
    
    2005
    
    
    2005except per share amounts)
    
    Q1
    
    
    Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1
    
    
    Q4
    
    
    Q3
    
    
    Q2Revenue
    
    $
    154,136
    
    
    $
    153,779
    
    
    $
    121,512
    
    
    $
    123,641
    
    
    $
    115,127
    
    
    $
    112,975
    
    
    $
    116,226
    
    
    $
    105,050Income from operations
    
    
    5,607
    
    
    
    8,143
    
    
    
    6,797
    
    
    
    8,128
    
    
    
    4,972
    
    
    
    6,937
    
    
    
    7,647
    
    
    
    7,013Net Income
    
    
    3,387
    
    
    
    4,974
    
    
    
    4,885
    
    
    
    5,776
    
    
    
    3,764
    
    
    
    5,012
    
    
    
    5,376
    
    
    
    4,796Earnings per share:Basic
    
    $
    0.25
    
    
    $
    0.37
    
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    0.30
    
    
    $
    0.40
    
    
    $
    0.43
    
    
    $
    0.39Diluted
    
    
    0.25
    
    
    
    0.37
    
    
    
    0.38
    
    
    
    0.45
    
    
    
    0.29
    
    
    
    0.39
    
    
    
    0.42
    
    
    
    0.38Weighted average number of shares:Basic
    
    
    13,438,065
    
    
    
    13,413,153
    
    
    
    12,744,936
    
    
    
    12,732,644
    
    
    
    12,652,075
    
    
    
    12,618,416
    
    
    
    12,584,358
    
    
    
    12,447,300Diluted
    
    
    13,651,872
    
    
    
    13,624,031
    
    
    
    12,966,835
    
    
    
    12,964,761
    
    
    
    12,934,751
    
    
    
    12,930,661
    
    
    
    12,921,695
    
    
    
    12,778,285
 Canadian GAAP(7)(thousands of dollars
    
    2007
    
    
    2006
    
    
    2006
    
    
    2006
    
    
    2006
    
    
    2005
    
    
    2005
    
    
    2005except per share amounts)
    
    Q1
    
    
    Q4
    
    
    Q3
    
    
    Q2
    
    
    Q1
    
    
    Q4
    
    
    Q3
    
    
    Q2Revenue
    
    $
    154,136
    
    
    $
    153,779
    
    
    $
    121,512
    
    
    $
    123,641
    
    
    $
    115,127
    
    
    $
    112,975
    
    
    $
    116,226
    
    
    $
    105,050Income from operations
    
    
    5,524
    
    
    
    8,143
    
    
    
    6,797
    
    
    
    8,128
    
    
    
    4,972
    
    
    
    6,937
    
    
    
    7,647
    
    
    
    7,013Net Income
    
    
    3,304
    
    
    
    4,974
    
    
    
    4,885
    
    
    
    5,776
    
    
    
    3,623
    
    
    
    5,012
    
    
    
    5,376
    
    
    
    4,796Earnings per share:Basic
    
    $
    0.25
    
    
    $
    0.37
    
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    0.29
    
    
    $
    0.40
    
    
    $
    0.43
    
    
    $
    0.39Diluted
    
    
    0.24
    
    
    
    0.37
    
    
    
    0.38
    
    
    
    0.45
    
    
    
    0.28
    
    
    
    0.39
    
    
    
    0.42
    
    
    
    0.38Weighted average number of shares:Basic
    
    
    13,438,065
    
    
    
    13,413,153
    
    
    
    12,744,936
    
    
    
    12,732,644
    
    
    
    12,652,075
    
    
    
    12,618,416
    
    
    
    12,584,358
    
    
    
    12,447,300Diluted
    
    
    13,651,872
    
    
    
    13,624,031
    
    
    
    12,966,835
    
    
    
    12,964,761
    
    
    
    12,934,751
    
    
    
    12,930,661
    
    
    
    12,921,695
    
    
    
    12,778,285
 18




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##### Table of Contents



Definitions of non-GAAP measures:
 (1)
    
    Operating ratio (OR) is a non-GAAP financial measure which does not have any standardized
meaning prescribed by GAAP. OR is the sum of operating expenses, selling, general and
administrative expenses, other expenses (income), and depreciation and amortization expense,
divided by revenue. OR allows management to measure the Company and its various segments
operating efficiency. OR is a widely recognized measure in the transportation industry which
provides a comparable benchmark for evaluating the Companys performance compared to its
competitors. Investors should also note that the Companys presentation of OR may not be
comparable to similarly titled measures by other companies. OR is calculated as follows:
 Three months ended March 31,
    
    2007
    
    
    2006Operating expenses
    
    $
    128,456
    
    
    $
    97,121Selling, general and administrative expenses
    
    
    15,099
    
    
    
    10,743Other expenses (income)
    
    
    29
    
    
    
    (116
    )Depreciation and amortization expense
    
    
    4,945
    
    
    
    2,407$
    148,529
    
    
    $
    110,155Revenue
    
    $
    154,136
    
    
    $
    114,127Operating ratio (OR)
    
    
    96.4
    %
    
    
    95.7
    %
 (2)
    
    A shipment is a single movement of goods from a point of origin to its final destination as
described on a bill of lading document.(3)
    
    Weight represents the total pounds shipped.(4)
    
    Revenue per shipment represents revenue divided by the number of shipments.(5)
    
    Revenue per hundredweight is the price obtained for transporting 100 pounds of LTL freight
from point to point, calculated by dividing the revenue for an LTL shipment by the
hundredweight (weight in pounds divided by 100) for a shipment.(6)
    
    Revenue per total mile represents revenue divided by the total miles driven.(7)
    
    Please see Note 13 to the Interim Consolidated Financial Statements for differences between
United States and Canadian GAAP.
 
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
  (in thousands of dollars)
    
    
    
    
    
    Payments due by periodLong-term debt
    
    Total
    
    
    2007
    
    
    2008 & 2009
    
    
    2010 & 2011
    
    
    ThereafterVariable RateTerm bank facility
    
    $
    76,000
    
    
    $
    6,000
    
    
    $
    70,000
    
    
    $
    Nil
    
    
    $
    NilAverage interest rate (LIBOR)
    
    
    7.23
    %
    
    
    7.23
    %
    
    
    7.23
    %Revolving bank facility
    
    
    6,384
    
    
    Nil
    
    
    
    6,384
    
    
    Nil
    
    
    NilAverage interest rate (LIBOR)
    
    
    7.23
    %
    
    
    
    
    
    
    7.23
    %
    
    
    
    
    
    NilRevolving bank facility
    
    
    4,157
    
    
    Nil
    
    
    
    4,157
    
    
    Nil
    
    
    NilAverage interest rate (CDN BA)
    
    
    6.23
    %
    
    
    
    
    
    
    6.23
    %Fixed RateTerm bank facility
    
    
    3,675
    
    
    
    765
    
    
    
    2,106
    
    
    
    804
    
    
    NilAverage interest rate
    
    
    4.74
    %
    
    
    4.74
    %
    
    
    4.74
    %
    
    
    4.74
    %Capital lease obligations
    
    
    18,078
    
    
    
    5,064
    
    
    
    9,329
    
    
    
    2,933
    
    
    
    752Average interest rate
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    6.00
    %Total
    
    $
    108,294
    
    
    $
    11,829
    
    
    $
    91,976
    
    
    $
    3,737
    
    
    $
    752
 19




---



##### Table of Contents



Item 4. Controls and Procedures
 a)
    
    As of April 25, 2007, the Chief Executive Officer and the Chief Financial Officer evaluated
the effectiveness of the Companys disclosure controls and procedures in accordance with Rule
13a-15 under the Exchange Act for the quarter ended March 31, 2007. Based on their
evaluation, the Companys Chief Executive Officer and the Chief Financial Officer concluded
that Vitrans disclosure controls and procedures enable Vitran to record, process, summarize
and report in a timely manner the information that we are required to disclose in our Exchange
Act reports.b)
    
    There were no changes in our internal control over financial reporting that occurred
during the period covered by this report that have materially affected, or are reasonably
likely to materially affect, the Companys internal control over financial reporting.
 
 Part II. Other Information
 
 Item 1. Legal Proceedings
  Item 1A. Risk Factors
  
 Item 2. Changes in Securities and Use of Proceeds
  Maximum numberTotal number of
    
    
    of Common SharesNumber of
    
    
    Average price paid
    
    
    Common Shares as
    
    
    that may yet beCommon Shares
    
    
    per Common Share
    
    
    part of a publicly
    
    
    purchased under thePeriod
    
    purchased
    
    
    (CAD)
    
    
    announced plan
    
    
    planFeb. 13 to Feb. 28, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    670,993Mar. 1 to Mar. 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    670,993Total
    
    
    
    
    
    
    
    
    
    
    
 20




---



##### Table of Contents



Item 3. Defaults Upon Senior Securities
 
 Item 4. Submission of Matters to a Vote of Security Holders
 a)
    
    On April 25, 2007 the Company held an Annual Meeting of Shareholders.b)
    
    The following directors were elected with the indicated number of votes set
forth below:
 Nominee
    
    For
    
    
    WithheldRichard D. McGraw
    
    
    10,340,337
    
    
    
    420,920Richard E. Gaetz
    
    
    10,713,087
    
    
    
    48,170Anthony F. Griffiths
    
    
    10,146,637
    
    
    
    614,620John R. Gossling
    
    
    10,712,587
    
    
    
    48,670Georges L. Hébert
    
    
    10,712,087
    
    
    
    49,170William S. Deluce
    
    
    10,756,607
    
    
    
    4,650
 c)
    
    The proposal for the ratification of the appointment of KPMG LLP as Independent
Auditors for 2007 was voted on and approved at the meeting by the following vote:
For: 10,756,607 Withheld: 4,650
 
 Item 5.
Other Information
 
 Item 6. Exhibits and Reports on Form 8-K
  ExhibitNumber
    
    Description of Exhibit31
    
    Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, dated April 25, 2007.32
    
    Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated April 25, 2007.
 SIGNATURE
  VITRAN CORPORATION INC./s/   SEAN P. WASHCHUKSean P. WashchukDate: April 25, 2007
    Vice President of Finance and
Chief Financial Officer
(Principle Financial Officer) /s/   FAYAZ D. SULEMANFayaz D. SulemanDate: April 25, 2007
    Corporate Controller
(Principle Accounting Officer) 21