##### 



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
 
 FORM 10-Q [X]
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTER ENDED JUNE 30, 2004 OR [  ]
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD FROM            to Commission file number: 
 VITRAN CORPORATION INC. Ontario, Canada
    
    (I.R.S. Employer(State of incorporation)
    
    Identification No.)
 185 The West Mall, Suite 701, Toronto, Ontario, Canada, M9C 5L5
(Address of principal executive offices)(Zip Code) 416-596-7664
(Registrants telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes  [X]  No  [  ] Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes  [  ]  No  [X] Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date. The number of shares of common stock outstanding at July 21 2004 was
12,301,978.




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TABLE OF CONTENTS Item
    
    
    
    PagePART I
    
    Financial Information1.
    
    Financial Statements
    
    32.
    
    Management Discussion and Analysis
    
    123.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    184.
    
    Controls and Procedures
    
    18PART II
    
    Other Information1.
    
    Legal Proceedings
    
    192.
    
    Changes in Securities and Use of Proceeds
    
    193.
    
    Defaults Upon Senior Securities
    
    194.
    
    Submission of Matters to a Vote of Security Holders
    
    195.
    
    Other Information
    
    196.
    
    Exhibits and Reports on Form 8-K
    
    21
 2




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Part I. Financial Information Item 1: Financial Statements VITRAN CORPORATION INC. CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(Unaudited) (In thousands of United States dollars except for per share amounts) Three
    
    Three
    
    Six
    
    Sixmonths
    
    months
    
    months
    
    monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30, 2004
    
    Jun. 30, 2003
    
    Jun. 30, 2004
    
    Jun. 30, 2003Revenue
    
    $
    93,931
    
    
    $
    84,135
    
    
    $
    181,077
    
    
    $
    161,600Operating expenses
    
    
    78,665
    
    
    
    70,656
    
    
    
    154,239
    
    
    
    137,740Selling, general and administrative expenses
    
    
    8,201
    
    
    
    8,042
    
    
    
    16,364
    
    
    
    14,97586,866
    
    
    
    78,698
    
    
    
    170,603
    
    
    
    152,715Income from operations before depreciation
    
    
    7,065
    
    
    
    5,437
    
    
    
    10,474
    
    
    
    8,889Depreciation expense
    
    
    1,232
    
    
    
    1,364
    
    
    
    2,540
    
    
    
    2,733Income from operations before undernoted
    
    
    5,833
    
    
    
    4,073
    
    
    
    7,934
    
    
    
    6,156Interest expense, net
    
    
    (37
    )
    
    
    (354
    )
    
    
    (80
    )
    
    
    (807
    )Gain (loss) on sale of capital assets
    
    
    37
    
    
    
    (140
    )
    
    
    113
    
    
    
    (100
    )
    
    
    
    (494
    )
    
    
    33
    
    
    
    (907
    )Income from operations before income taxes
    
    
    5,833
    
    
    
    3,579
    
    
    
    7,967
    
    
    
    5,249Income taxes
    
    
    1,446
    
    
    
    855
    
    
    
    1,931
    
    
    
    1,108Net income
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6,036
    
    
    $
    4,141Retained earnings, beginning of period
    
    $
    41,678
    
    
    $
    31,291
    
    
    $
    40,029
    
    
    $
    30,044Cost of repurchase of Class A shares in
excess of book value
    
    nil
    
    
    (181
    )
    
    nil
    
    
    (351
    )Retained earnings, end of period
    
    $
    46,065
    
    
    $
    33,834
    
    
    $
    46,065
    
    
    $
    33,834Earnings per share:Basic
    
    $
    0.36
    
    
    $
    0.29
    
    
    $
    0.50
    
    
    $
    0.43Diluted
    
    $
    0.34
    
    
    $
    0.27
    
    
    $
    0.47
    
    
    $
    0.42
 See accompanying notes to consolidated financial statements. 3




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VITRAN CORPORATION INC. CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands of United States dollars) AS ATJun. 30, 2004
    
    Dec. 31, 2003AssetsCurrent assets:Cash
    
    $
    7,961
    
    
    $
    12,417Marketable securities (2004 - Cdn
$35,300, 2003 - Cdn $35,000)
    
    
    26,533
    
    
    
    26,996Accounts receivable
    
    
    42,521
    
    
    
    35,685Inventory, deposits and prepaid expenses
    
    
    5,163
    
    
    
    5,847Future income tax assets
    
    
    4,576
    
    
    
    4,10186,754
    
    
    
    85,046Capital assets
    
    
    34,978
    
    
    
    35,102Goodwill
    
    
    44,708
    
    
    
    44,865$
    166,440
    
    
    $
    165,013Liabilities and Shareholders EquityCurrent liabilities:Accounts payable and accrued liabilities
    
    
    33,562
    
    
    $
    34,092Income and other taxes payable
    
    
    3,948
    
    
    
    4,007Current portion of long-term debt
    
    
    8,674
    
    
    
    8,31346,184
    
    
    
    46,412Long-term debt
    
    
    13,591
    
    
    
    17,931Future income tax liabilities
    
    
    3,060
    
    
    
    2,715Shareholders equity:Capital stock (note 3)
    
    
    60,257
    
    
    
    59,358Contributed surplus
    
    
    58
    
    
    
    Retained earnings
    
    
    46,065
    
    
    
    40,029Cumulative translation adjustment (note 2)
    
    
    (2,774
    )
    
    
    (1,432
    )103,605
    
    
    
    97,955$
    166,440
    
    
    $
    165,013
 See accompanying notes to consolidated financial statements. 4




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VITRAN CORPORATION INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In thousands of United States dollars) Three months
    
    Three months
    
    Six months
    
    Six monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30, 2004
    
    Jun. 30, 2003
    
    Jun. 30, 2004
    
    Jun. 30, 2003Cash provided by (used in):Operations:Net income
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6,036
    
    
    $
    4,141Items not involving cash from operationsDepreciation and amortization
    
    
    1,232
    
    
    
    1,364
    
    
    
    2,540
    
    
    
    2,733Future income taxes
    
    
    (465
    )
    
    
    (38
    )
    
    
    (169
    )
    
    
    (280
    )Stock based compensation expense
    
    
    58
    
    
    
    
    
    
    
    58Loss (gain) on sale of capital assets
    
    
    (37
    )
    
    
    140
    
    
    
    (113
    )
    
    
    1005,175
    
    
    
    4,190
    
    
    
    8,352
    
    
    
    6,694Change in non-cash working capital
components
    
    
    3,448
    
    
    
    (1,745
    )
    
    
    (6,741
    )
    
    
    (4,006
    )8,623
    
    
    
    2,445
    
    
    
    1,611
    
    
    
    2,688Investments:Purchase of capital assets
    
    
    (1,443
    )
    
    
    (310
    )
    
    
    3,078
    )
    
    
    (1,592
    )Proceeds on sale of capital assets
    
    
    79
    
    
    
    123
    
    
    
    214
    
    
    
    291Purchase of marketable securities
    
    
    (146
    )
    
    
    
    
    
    
    (291
    )
    
    
    (1,510
    )
    
    
    (187
    )
    
    
    (3,155
    )
    
    
    (1,301
    )Financing:Repayment of long-term debt
    
    
    (2,168
    )
    
    
    (2,411
    )
    
    
    (3,977
    )
    
    
    (3,549
    )Issue of Class A Voting shares
upon exercise of stock options
    
    
    548
    
    
    
    79
    
    
    
    899
    
    
    
    171Repurchase of Class A Voting shares
    
    
    
    
    
    
    (319
    )
    
    
    
    
    
    
    (644
    )(1,620
    )
    
    
    (2,651
    )
    
    
    (3,078
    )
    
    
    (4,022
    )Effect of translation adjustment on cash
    
    
    108
    
    
    
    (448
    )
    
    
    166
    
    
    
    (705
    )Increase (decrease) in cash position
    
    
    5,601
    
    
    
    (841
    )
    
    
    (4,456
    )
    
    
    (3,340
    )Cash position, beginning of period
    
    
    2,360
    
    
    
    5,503
    
    
    
    12,417
    
    
    
    8,002Cash position, end of period
    
    $
    7,961
    
    
    $
    4,662
    
    
    $
    7,961
    
    
    $
    4,662Change in non-cash working capital
components:Accounts receivable
    
    $
    (1,832
    )
    
    $
    (1,342
    )
    
    $
    (6,836
    )
    
    $
    (7,094
    )Inventory, deposits and prepaid expenses
    
    
    690
    
    
    
    713
    
    
    
    684
    
    
    
    1,054Income and other taxes recoverable/payable
    
    
    1,226
    
    
    
    468
    
    
    
    (59
    )
    
    
    530Accounts payable and accrued liabilities
    
    
    3,364
    
    
    
    (1,584
    )
    
    
    (530
    )
    
    
    1,503$
    3,448
    
    
    $
    (1,745
    )
    
    $
    (6,741
    )
    
    $
    (4,006
    )
 See accompanying notes to consolidated financial statements. 5




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited) (In thousands of United States dollars except for per share amounts)  1.
    
    Accounting PoliciesThe interim consolidated financial statements have been prepared in
accordance with Canadian generally accepted accounting principles with
reconciliation to United States generally accepted accounting principles in
note 7 and follow the same accounting principles and methods of application
as the most recent annual consolidated financial statements. The interim
consolidated financial statements do not contain all the disclosures required
by Canadian and United States generally accepted accounting principles. The
interim consolidated financial statements have been prepared in accordance
with instruction to Quarterly Report on Form 10-Q. The interim consolidated
financial statements should be read in conjunction with the Companys Annual
Report and the Annual Report on Form 10-K.These unaudited consolidated interim financial statements reflect all
adjustments which are, in the opinion of management, necessary to a fair
presentation of the results of the interim period presented. Operating
results for the quarter ended June 30, 2004, are not necessarily indicative
of the results of operations that may be expected for the year ended December
31, 2004.All amounts in these consolidated interim financial statements are expressed
in United States dollars, unless otherwise stated.2.
    
    Foreign Currency TranslationThe United States dollar is the functional currency of the Companys
operations in the U.S. The Canadian dollar is the functional currency of the
Companys Canadian operations.Each operation translates foreign currency denominated transactions into its
functional currency using the rate of exchange in effect at the date of the
transaction.Monetary assets and liabilities denominated in foreign currency are
translated into the functional currency of the operation using the period-end
rate of exchange giving rise to a gain or loss that is recognized in income
during the current period.For reporting purposes, the Canadian operations are translated into United
States dollars using the current rate method. Under this method, all assets
and liabilities are translated at the period-end rate of exchange and all
revenue and expense items are translated at the average rate of exchange for
the period. The resulting translation adjustment is recorded as a separate
component of shareholders equity. United States dollar debt of $22.3 million
is designated as a hedge of the investment in the United States
self-sustaining operations. 6




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3.
    
    Capital Stock  (a)
    
    AuthorizedThe Companys capital stock consists of an unlimited number of
Common Shares. On April 21, 2004 the shareholders of the Company
voted to redesignate the Companys Class A Voting shares as Common
Shares and cancelled the previously unissued Class B non-voting
shares and first preference shares.(b)
    
    Issued June 30, 2004
    
    June 30, 2003Common Shares
    
    Number
    
    Amount
    
    Number
    
    AmountBalance, beginning of year
    
    
    12,094,278
    
    
    $
    59,358
    
    
    
    9,559,818
    
    
    $
    27,857Shares repurchased for cancellation
    
    
    
    
    
    
    
    
    
    
    (106,500
    )
    
    
    (312
    )Shares issued upon exercise of
employees stock options
    
    
    207,700
    
    
    
    899
    
    
    
    35,320
    
    
    
    171Balance, end of period
    
    
    12,301,978
    
    
    $
    60,257
    
    
    
    9,488,638
    
    
    $
    27,716
  (c)
    
    Weighted average number of sharesThe Company uses the treasury-stock method to calculate diluted
earnings per share. Under the treasury-stock method, the weighted
average number of shares outstanding for basic earnings per share is
adjusted to reflect the assumed exercise of the Companys outstanding
stock options less the shares that could otherwise be acquired from
the assumed proceeds on exercise. Three months
    
    Three months
    
    Six months
    
    Six monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30, 2003
    
    Jun. 30, 2003
    
    Jun. 30, 2004
    
    Jun. 30, 2003Weighted average number of shares:Basic
    
    
    12,266,703
    
    
    
    9,511,133
    
    
    
    12,190,998
    
    
    
    9,533,202Potential exercise of stock options
    
    
    505,081
    
    
    
    399,761
    
    
    
    525,555
    
    
    
    401,316Diluted
    
    
    12,771,784
    
    
    
    9,910,894
    
    
    
    12,716,553
    
    
    
    9,934,518
 7




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4.
    
    Stock Option PlanUnder the Companys stock option plan, options to purchase Common Shares of
the Company may be granted to key employees, officers and directors of the
Company and its affiliates by the Board of Directors or by the Companys
Compensation Committee. There are 1,367,900 options authorized under the
plan. The term of each option is ten years and the vesting period is
generally five years. The exercise price for options is the trading price of
the Common Shares of the Company on the Toronto Stock Exchange on the day of
the grant.
The Company has applied the fair value method for stock options granted on or
after January 1, 2003. The Company has applied the pro forma disclosure
provisions of the standard to awards granted during 2002, and consistent with
the standard, the pro forma effect of stock options granted prior to January
1, 2002 have not been included. The following table outlines the impact: Three months
    
    Three months
    
    Six months
    
    Six monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30, 2003
    
    Jun. 30, 2003
    
    Jun. 30, 2004
    
    Jun. 30, 2003Net income, as reported
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6,036
    
    
    $
    4,141Pro forma net income
    
    $
    4,377
    
    
    $
    2,714
    
    
    $
    6,016
    
    
    $
    4,123Pro forma basic income per share
    
    $
    0.36
    
    
    $
    0.29
    
    
    $
    0.49
    
    
    $
    0.43Pro forma diluted income per share
    
    $
    0.34
    
    
    $
    0.27
    
    
    $
    0.47
    
    
    $
    0.42
  On March 9, 2004 the Board of Directors of the Company approved an amendment
to the Company stock option plan to increase the aggregate number of Common
Shares issuable under the Plan by an additional 750,000 Common Shares and
granted 205,000 stock options to executive officers and certain non-executive
employees of the Company. The stock options granted on March 9, 2004 were
not expensed in the first quarter financial statements as the shareholders of
the Company had yet to approve the increase to the aggregate number of Common
Shares reserved under the stock plan. On April 21, 2004 the shareholders of
the Company approved the amendment to the stock option plan. Accordingly,
for the 205,000 stock options granted, the associated stock option expense of
$58,000 pursuant to the fair value method has been recognized in the
financial statements.The fair value of each stock option granted was estimated on April 21, 2004
using the Black-Scholes fair value option-pricing model with the following
assumptions: Risk-free interest rate
    
    
    4.98
    %Dividend Yield
    
    
    0.0
    %Volatility factor of the future expected market price of the Companys common shares
    
    
    35.98
    %Expected life of the options
    
    10 years
  5.
    
    Contingent Liabilities  There exists certain legal actions against the Company, none of which is
expected to have a material adverse effect on the consolidated financial
position or results of operations of the Company. 8




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##### 



6.
    
    Segmented Information Three months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    ConsolidatedJune 30, 2004
    
    truckload
    
    Logistics
    
    Truckload
    
    Total
    
    and Other
    
    TotalsRevenue
    
    $
    75,958
    
    
    $
    8,768
    
    
    $
    9,205
    
    
    $
    93,931
    
    
    $
    
    
    
    $
    93,931Operating, selling, general and
administrative expenses
    
    
    69,414
    
    
    
    8,251
    
    
    
    8,629
    
    
    
    86,294
    
    
    
    572
    
    
    
    86,866Depreciation
    
    
    1,054
    
    
    
    75
    
    
    
    89
    
    
    
    1,218
    
    
    
    14
    
    
    
    1,232Income (loss) from operations
    
    $
    5,490
    
    
    $
    442
    
    
    $
    487
    
    
    $
    6,419
    
    
    $
    (586
    )
    
    
    5,833Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37Gain on sale of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,446Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    4,387
 Three months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    ConsolidatedJune 30, 2003
    
    truckload
    
    Logistics
    
    Truckload
    
    Total
    
    and Other
    
    TotalsRevenue
    
    $
    68,495
    
    
    $
    7,124
    
    
    $
    8,516
    
    
    $
    84,135
    
    
    $
    
    
    
    $
    84,135Operating, selling, general and
administrative expenses
    
    
    63,057
    
    
    
    6,876
    
    
    
    8,143
    
    
    
    78,076
    
    
    
    621
    
    
    
    78,697Depreciation
    
    
    1,159
    
    
    
    56
    
    
    
    135
    
    
    
    1,350
    
    
    
    14
    
    
    
    1,364Income (loss) from operations
    
    $
    4,279
    
    
    $
    192
    
    
    $
    238
    
    
    
    4,709
    
    
    $
    (635
    )
    
    
    4,074Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    354Gain (loss) on sale of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (140
    )Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    855Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    2,725
 Six months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    ConsolidatedJune 30, 2004
    
    truckload
    
    Logistics
    
    Truckload
    
    Total
    
    and Other
    
    TotalsRevenue
    
    $
    146,217
    
    
    $
    16,935
    
    
    $
    17,925
    
    
    $
    181,077
    
    
    $
    
    
    
    $
    181,077Operating, selling, general and
administrative expenses
    
    
    136,595
    
    
    
    15,998
    
    
    
    16,816
    
    
    
    169,409
    
    
    
    1,194
    
    
    
    170,603Depreciation
    
    
    2,183
    
    
    
    153
    
    
    
    175
    
    
    
    2,511
    
    
    
    29
    
    
    
    2,540Income (loss) from operations
    
    $
    7,439
    
    
    $
    784
    
    
    $
    934
    
    
    $
    9,157
    
    
    $
    (1,223
    )
    
    
    7,934Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    80Gain on sale of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,931Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6,036
 Six months ended
    
    Less-than-
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate Office
    
    ConsolidatedJune 30, 2003
    
    truckload
    
    Logistics
    
    Truckload
    
    Total
    
    and Other
    
    TotalsRevenue
    
    $
    131,717
    
    
    $
    13,463
    
    
    $
    16,420
    
    
    $
    161,600
    
    
    $
    
    
    
    $
    161,600Operating, selling, general and
administrative expenses
    
    
    122,535
    
    
    
    13,092
    
    
    
    15,854
    
    
    
    151,481
    
    
    
    1,230
    
    
    
    152,711Depreciation
    
    
    2,347
    
    
    
    108
    
    
    
    252
    
    
    
    2,707
    
    
    
    26
    
    
    
    2,733Income (loss) from operations
    
    $
    6,835
    
    
    $
    263
    
    
    $
    314
    
    
    
    7,412
    
    
    $
    (1,256
    )
    
    
    6,156Interest expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    807Gain (loss) on sale of fixed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (100
    )Income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,108Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    4,141
 9




---



##### 



7.
    
    Canadian and United States accounting policy differences:  (a)
    
    Consolidated Statements of changes in shareholders equityUnited States GAAP requires the inclusion of a consolidated statement of
changes in shareholders equity for each statement of income year.
Shareholders equity under United States GAAP is as follows: OtherCapital
    
    Contributed
    
    Retained
    
    comprehensivestock
    
    Surplus
    
    earnings
    
    income
    
    TotalBalance, December 31, 2003
    
    $
    59,358
    
    
    $
    
    
    
    $
    39,171
    
    
    $
    5,237
    
    
    $
    103,766Net income
    
    
    
    
    
    
    
    
    
    
    4,387
    
    
    
    
    
    
    
    4,387Unrealized foreign currency loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,342
    )
    
    
    (1,342
    )Stock based compensation expense
    
    
    
    
    
    
    58
    
    
    
    
    
    
    
    
    
    
    
    58Shares issued upon exercise of options
    
    
    899
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    899Balance, June 30, 2004
    
    $
    60,257
    
    
    $
    58
    
    
    $
    43,558
    
    
    $
    3,895
    
    
    $
    107,768
  (b)
    
    Consolidated statements of cash flows:Canadian GAAP permits the disclosure of a subtotal of the amount of
cash provided by operations before changes in non-cash working capital
items in the consolidated statements of cash flows. United States GAAP
does not permit this subtotal to be included.(c)
    
    Statement of net income (loss) and comprehensive income (loss)The following table reconciles net income for the three-month and
six-month periods as reported in the consolidated statement of operations
to what would have been reported had the statements been prepared in
accordance with United States GAAP.United States GAAP requires the disclosure of a Statement of Comprehensive
Income. Comprehensive income generally encompasses all changes in
shareholders equity, except those arising from transactions with
shareholders. Three
    
    Three
    
    Six
    
    Sixmonths
    
    months
    
    months
    
    monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30,
    
    Jun. 30,
    
    Jun. 30,
    
    Jun. 30,2004
    
    2003
    
    2004
    
    2003Net income based on Canadian and
United States GAAP
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6,036
    
    
    $
    4,141Net income based on United States GAAP
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6,036
    
    
    
    4,141Other comprehensive income:Change in cumulative translation
adjustment
    
    
    (800
    )
    
    
    1,643
    
    
    
    (1,342
    )
    
    
    2,930Obligation for derivative instruments (i)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    116Comprehensive income based
on United States GAAP
    
    $
    3,587
    
    
    $
    4,367
    
    
    $
    4,694
    
    
    $
    7,187
 10




---



##### 



(i) The change in the fair value of the Companys obligation for its
interest rate swap, which was designated as a cash flow hedge, has been
included net of the income tax effect of nil (2003 - $78,000).  (d)
    
    Earnings per share Three
    
    Three
    
    Six
    
    Sixmonths
    
    months
    
    months
    
    monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30,
    
    Jun. 30,
    
    Jun. 30,
    
    Jun. 30,2004
    
    2003
    
    2004
    
    2003Earnings per
share under
United States GAAPBasic
    
    $
    0.36
    
    
    $
    0.29
    
    
    $
    0.50
    
    
    $
    0.43Diluted
    
    $
    0.34
    
    
    $
    0.27
    
    
    $
    0.47
    
    
    $
    0.42
  (e)
    
    Income from operations before depreciationUnited States GAAP requires that depreciation be included in the
determination of income from operations. Further, U.S. GAAP does not permit
the disclosure of a subtotal of the amount of income from continuing
operations before this item. Canadian GAAP permits the disclosure of a
subtotal of the amount of income from operations before this item.(f)
    
    Stock-based compensation:Pro forma stock option disclosure:The following table outlines the pro forma impact if the compensation cost
for the Companys stock options is determined under the fair value method for
awards granted on or after January 1, 1995. Three
    
    Three
    
    Six
    
    Sixmonths
    
    months
    
    months
    
    monthsEnded
    
    Ended
    
    Ended
    
    EndedJun. 30, 2004
    
    Jun. 30, 2003
    
    Jun. 30, 2004
    
    Jun. 30, 2003Stock options granted
    
    
    205,000
    
    
    
    
    
    
    
    
    
    
    
    Net income based on
United States GAAP
    
    $
    4,387
    
    
    $
    2,724
    
    
    $
    6.036
    
    
    $
    4,141Pro forma net income
    
    $
    4,346
    
    
    $
    2,671
    
    
    $
    5,954
    
    
    $
    4,035Pro forma basic income per share
    
    $
    0.35
    
    
    $
    0.28
    
    
    $
    0.49
    
    
    $
    0.42Pro forma diluted income per share
    
    $
    0.34
    
    
    $
    0.27
    
    
    $
    0.47
    
    
    $
    0.41
 11




---



##### 



Item 2. Managements Discussion and Analysis of Results of Operation Forward-Looking Statements:This Quarterly Report contains forward-looking
statements within the meaning of the United States Private Securities
Litigation Reform Act of 1995 concerning Vitran Corporation Inc.s business,
operations, and financial performance and condition. When used in this
Quarterly Report, the words believe, anticipate, intend, estimate,
expect, project and similar expressions are intended to identify
forward-looking statements, although not all forward-looking statements contain
such words. These forward-looking statements are based on current expectations
and are naturally 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. Factors that may cause such differences
include but are not limited to technological change, regulatory change, the
general health of the economy and competitive factors. More detailed
information about these and other factors are included in the 2003 Annual
Report and the Companys Form 10-K in respect of 2003. 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. is
under no obligation to update or alter such forward-looking statements whether
as a result of new information, future events or otherwise. Unless otherwise
indicated all dollar references herein are in U.S. dollars. Definitions of
non-GAAP measures are listed subsequent to the management discussion and
analysis of results of operations. Overview The second quarter of 2004 marked another record quarter for Vitran. Net
income increased 61.0% over the prior year second quarter and marked the
eleventh consecutive quarter of improved earnings. All segments within the
Company improved, posting both revenue and profitability increases. The LTL
segment benefited from economic expansion in the Midwestern United States while
continuing to make market shares gains in Canada and the United States. For
the six-month period ended June 30, 2004 results exceeded the prior year
six-month period despite the adverse impact of the five-week strike at CN
Railway Co. (CN). Strike related issues disrupted linehaul operations at the
Canadian LTL business unit, reducing revenue and considerably increasing
operating costs in during February and March 2004. However, the Company
efficiently diverted many shipments over-the-road during the strike, and
quickly resumed normal operations once the strike ended. Strong results at
both the Truckload and the Logistics segments also contributed to the
improvement. Consolidated Results The following table summarizes the Consolidated Statements of Income for the
periods ended: For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004 vs 2003
    
    2004
    
    2003
    
    2004 vs 2003Revenue
    
    $
    93,931
    
    
    $
    84,135
    
    
    
    11.6
    %
    
    $
    181,077
    
    
    $
    161,600
    
    
    
    12.1
    %Income from
operations
    
    
    5,833
    
    
    
    4,073
    
    
    
    43.2
    %
    
    
    7,934
    
    
    
    6,156
    
    
    
    28.9
    %Interest expense, net
    
    
    37
    
    
    
    354
    
    
    
    (89.5
    )%
    
    
    80
    
    
    
    807
    
    
    
    (90.1
    )%Net income
    
    
    4,387
    
    
    
    2,724
    
    
    
    61.0
    %
    
    
    6,036
    
    
    
    4,141
    
    
    
    45.8
    %Operating Ratio
    
    
    93.8
    %
    
    
    95.2
    %
    
    
    
    
    
    
    95.6
    %
    
    
    96.2
    %
 12




---



##### 



Revenue increased 11.6% to $93.9 million for the second quarter of 2004
compared to $84.1 million in the second quarter of 2003. Revenue in the LTL
segment increased 10.9% while revenue at the Logistics and Truckload segments
grew 23.1% and 8.1% respectively. For the six months ended June 30, 2004
revenue increased 12.1% to $181.1 million compared to $161.6 million for the
same period in 2003. Income from operations for the second quarter of 2004 improved 43.2% to $5.8
million compared to $4.1 million in the second quarter of 2003. All three
segments, LTL, Logistics and Truckload, posted quarter over prior year quarter
improvements of 28.3%, 130.2% and 104.6%, respectively. Economic growth,
primarily in the Midwestern United States buoyed the results of the LTL and
Truckload segments. Improved density and continuing focus on cost control also
improved profitability. For the six months ended June 30, 2004 income from
operations increased 28.9% to $7.9 million compared to $6.2 million for the
same period in 2003. Improvements at the Logistics and Truckload segments as
well as improving fundamentals in the LTL segment contributed to the increase.
In addition, the Company changed the estimated useful life for its tractors
from 7 years to 8 years and its trailers from 10 years to 12 years to more
accurately reflect the actual useful life of its equipment and to bring the
Companys policy in line with its peer group. This change in estimate was
recorded prospectively and resulted in a reduction in depreciation expense of
$0.2 million for the 2004 second quarter and $0.4 million for the six month
ended June 30, 2004. The net impact of the items discussed above was that the
consolidated operating ratio for the second quarter of 2004 improved to 93.8%
compared to 95.2% in the second quarter of 2003. The operating ratio for the
six months ended June 30, 2004 improved to 95.6% compared to 96.2% for the same
period in 2003. Interest expense net of interest income was $0.1 million for the six months
ended June 30, 2004 compared to $0.8 million in the six months ended June 30,
2003. This reduction was primarily due to the Companys Cdn $35.3 million in
short-term investments generating interest income of Cdn $0.3 million. As
well, the Company repaid $4.0 million of its outstanding debt obligations and
had a 50 basis point reduction in interest rate spreads starting in February
2004. Income tax expense for the second quarter of 2004 was $1.4 million compared to
$0.9 million in the second quarter of 2003. The effective tax rate was 24.8%
for the second quarter of 2004 compared to 23.9% in the second quarter of 2003.
For the six months ended June 30, 2004 the effective tax rate was 24.2%
compared to 21.1% for the same period a year ago. The increase in effective
rates can be attributed to an increase in statutory rates as well as a higher
proportion of income being earned in higher tax jurisdictions. Net income improved by 61.0% to $4.4 million for the second quarter of 2004, an
all time record for Vitran, compared to $2.7 million in the second quarter of
2003. This resulted in $0.36 per share basic and $0.34 diluted for the
quarter, compared to $0.29 per share basic and $0.27 per share diluted in 2003.
The weighted average number of shares for the second quarter of 2004 was 12.3
million basic and 12.8 million diluted compared to 9.5 million basic and 9.9
million diluted shares in the second quarter of 2003. For the six months ended
June 30, 2004 net income improved by 45.8% to $6.0 million compared to $4.1
million in the same period a year ago. This resulted in $0.50 per share basic
and $0.47 diluted for the quarter, compared to $0.43 per share basic and $0.42
per share diluted in 2003. The weighted average number of shares for the six- 13




---



##### 



month period of 2004 was 12.2 million basic and 12.7 million diluted compared
to 9.5 million basic and 9.9 million diluted shares in the six month period of
2003. The weighted average number of shares for 2004 reflects the Companys
2.3 million share equity offering in the fourth quarter of 2003, and more
dilution due to the fact that the majority of outstanding stock options were in
the money in the three month and six month period ended June 30, 2004. Segmented Results Less-Than-Truckload (LTL) The table below provides summary information for the LTL segment for the
periods ended June 30: For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004 vs 2003
    
    2004
    
    2003
    
    2004 vs 2003Revenue
    
    $
    75,958
    
    
    $
    68,495
    
    
    
    10.9
    %
    
    $
    146,217
    
    
    $
    131,717
    
    
    
    11.0
    %Income from Operations
    
    
    5,490
    
    
    
    4,279
    
    
    
    28.3
    %
    
    
    7,439
    
    
    
    6,835
    
    
    
    8.8
    %Operating Ratio
    
    
    92.8
    %
    
    
    93.8
    %
    
    
    
    
    
    
    94.9
    %
    
    
    94.8
    %
 The LTL segment posted another quarterly improvement in revenue, increasing
10.9%. Income from operations for the second quarter of 2004 improved 28.3% to
$5.5 million, compared $4.3 million in 2003. Increased density throughout
Canadian and U.S. infrastructure including a 47.5% increase in transborder
revenue contributed to the improvement. The LTL segments operating ratio for
the second quarter improved to 92.8% compared to 93.8% in the second quarter of
2003. Income from operations for the six-month period ended June 30, 2004
increased 8.8% to $7.4 million compared to $6.8 million in the same period a
year ago. Income from operations for the six-month period include the adverse
impact of approximately $1.0 million related to the CN strike. Transborder
revenue increased 45.1% for the 2004 six-month period, partially offsetting the
CN strike impact, contributing to the operating ratio of 94.9% compared to
94.8% in the 2003 six-month period. The Canadian LTL business unit increased revenue in all of its lines of
business: national, regional, expedited, and transborder. Market share gains
and a firm pricing environment in the Canadian LTL unit helped grow revenue
10.3% in second quarter of 2004 compared to the same period in 2003. For the
2004 second quarter compared to the second quarter of 2003, shipments, tonnage
and revenue per hundredweight increased 8.8%, 5.8% and 4.2% respectively. The U.S. LTL business unit increased revenue by 9.8% to $44.5 million for the
second quarter of 2004. The improvement in revenue was driven by increase in
shipments of 4.0% and an increase in tonnage of 9.9%. Revenue per
hundredweight declined 0.1% for the quarter driven by an increase in average
shipment size of 5.6% and a change in freight mix. 14




---



##### 



Logistics The table below provides summary information for the Logistics segment for the
periods ended June 30: For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004 vs 2003
    
    2004
    
    2003
    
    2004 vs 2003Revenue
    
    $
    8,768
    
    
    $
    7,124
    
    
    
    23.1
    %
    
    $
    16,935
    
    
    $
    13,463
    
    
    
    25.8
    %Income from Operations
    
    
    442
    
    
    
    192
    
    
    
    130.2
    %
    
    
    784
    
    
    
    263
    
    
    
    198.1
    %Operating Ratio
    
    
    95.0
    %
    
    
    97.3
    %
    
    
    
    
    
    
    95.4
    %
    
    
    98.0
    %
 Revenues for the Logistics segment were up 23.1% for the second quarter of
2004, and the operating ratio improved to 95.0% compared to 97.3% in the second
quarter of 2003. Revenue and income from operation increases were attributable
to improvements across all the logistics business units with strong growth
coming from the Supply Chain unit that opened a new distribution centre during
the quarter. Truckload (TL) The table below provides summary information for the TL segment for the periods
ended June 30: For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004 vs 2003
    
    2004
    
    2003
    
    2004 vs 2003Revenue
    
    $
    9,205
    
    
    $
    8,516
    
    
    
    8.1
    %
    
    $
    17,925
    
    
    $
    16,420
    
    
    
    9.2
    %Income from Operations
    
    
    487
    
    
    
    238
    
    
    
    104.6
    %
    
    
    934
    
    
    
    314
    
    
    
    197.5
    %Operating Ratio
    
    
    94.7
    %
    
    
    97.2
    %
    
    
    
    
    
    
    94.8
    %
    
    
    98.1
    %
 Revenue for the Truckload segment increased from 8.1% to $9.2 million in the
second quarter of 2004 compared to $8.5 million in the second quarter of 2003.
The Truckload segment is focusing on better yielding freight and successfully
increased revenue per total mile by 14.2% and decreased empty miles by 27.3%
while shipments declined by 16.9% for the second quarter of 2004 compared to
the same period in 2003. The revenue increase and yield progress improved the
operating ratio to 94.7% from 97.2% in the second quarter of 2003. LIQUIDITY AND CAPITAL RESOURCES Cash flow from operations for the 2004 six-month period, before working capital
changes, generated $8.4 million compared to $6.7 million in 2003. Non-cash
working capital changes consumed $6.7 million in the 2004 six-month period
compared to $4.0 million in 2003. The increase in accounts receivable at June
30, 2004 compared to December 31, 2003 was due to higher revenue. The increase
was however mitigated by improved collections that resulted in 39.1 days sales
outstanding at the end of June 2004 compared to 40.5 days at the end of
December 2003. 15




---



##### 



Interest-bearing debt decreased to $22.3 million at June 30, 2004 from $26.2
million at the end of 2003. The interest-bearing debt is comprised of $22.2
million drawn under the term bank credit facility and a capital lease of $0.1
million. During the first six months the Company repaid $3.1 million of
interest-bearing debt. At June 30, 2004, the Company had Cdn $21.5 million of
unused credit facilities. In December 2003, the Company issued and sold, in an underwritten public
offering, 2,300,000 shares of Class A Voting stock in consideration for net
proceeds of $29.4 million. The proceeds of the offering are to be used to fund
possible future acquisitions and capital expenditures and may be used to repay
amounts outstanding under the Companys credit facilities. At June 30, 2004,
the Company had $8.0 million of cash on hand as well as Cdn $35.3 million in
investment grade short-term securities. Capital expenditures amounted to $1.4 million for the second quarter and $3.1
million for six-month period of 2004 and were funded out of operating cash
flows of the Company. The table below sets forth the Companys capital
expenditures for the periods ended June 30. For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004
    
    2003Real estate and buildings
    
    $
    
    
    
    $
    
    
    
    $
    32
    
    
    $
    9Tractors
    
    
    688
    
    
    
    120
    
    
    
    779
    
    
    
    120Trailing fleet
    
    
    629
    
    
    
    25
    
    
    
    1,714
    
    
    
    789Information technology
    
    
    42
    
    
    
    68
    
    
    
    321
    
    
    
    532Leasehold improvements
    
    
    11
    
    
    
    5
    
    
    
    16
    
    
    
    5Other equipment
    
    
    73
    
    
    
    92
    
    
    
    216
    
    
    
    137Total
    
    $
    1,443
    
    
    $
    310
    
    
    $
    3,078
    
    
    $
    1,592
 Management estimates that cash capital expenditures for the remainder of 2004
will be between $5.0 million and $7.0 million, the majority of which will be
for tractors and trailers. The Company also anticipates entering into
operating leases to fund the acquisition of equipment with a capital cost of
between $3.0 and $5.0 million. The Company has contractual obligations that include long-term debt consisting
of a term debt facility, capital leases for operating equipment in the
Logistics segment and off-balance sheetoperating leases primarily consisting
of tractor, trailing fleet and real estate leases. Operating leases form an
integral part of the Companys financial structure and operating methodology as
it provides an alternative cost effective and flexible form of financing. The
following table summarizes our significant contractual obligations and
commercial commitments as of June 30, 2004: (in thousands of dollars)
    
    Payments due by periodContractual Obligations
    
    Total
    
    2004
    
    2005 & 2006
    
    2007 & 2008
    
    ThereafterLong-term debt
    
    $
    22,159
    
    
    $
    4,324
    
    
    $
    17,835
    
    
    $
    Nil
    
    
    $
    NilCapital lease obligations
    
    
    106
    
    
    
    13
    
    
    
    56
    
    
    
    37Sub-total
    
    
    22,265
    
    
    
    4,337
    
    
    
    17,891
    
    
    
    37
    
    
    NilOff-balance sheet commitmentsOperating leases
    
    
    47,711
    
    
    
    8,937
    
    
    
    23,176
    
    
    
    11,226
    
    
    
    4,372Total Contractual Obligations
    
    $
    69,976
    
    
    $
    13,274
    
    
    $
    41,067
    
    
    $
    11,263
    
    
    $
    4,372
 16




---



##### 



In addition to the above noted contractual obligations, the Company, as at June
30, 2004, utilized the revolving credit facility for a standby letter of credit
of $2.6 million expiring in November 2004. The letter of credit is used as
collateral for self-insured retention of insurance claims. A significant decrease in demand for our services could limit the Companys
ability to generate cash flow and affect its profitability. The Companys
credit agreement contains covenants that require the company to achieve stated
levels of financial performance, which, if not achieved, could cause an
acceleration of the payment schedules. Management does not anticipate a
significant decline in business levels or financial performance and expects
that existing working capital, together with available revolving facilities, is
sufficient to fund operating and capital requirements in 2004 as well as
service the contractual obligations. OUTLOOK The second quarter of 2004 was a record quarter for Vitran. All operating
segments performed very well posting improved results over the prior year
quarter. The positive signs indicated in the economy point toward continued
improvement for the remainder of the year. Management intends to maintain its
focus on improving results by focusing on revenue and yield improvement in its
LTL segment. It is still the Companys objective to use the proceeds from the
December 2003 public offering to acquire an LTL operation in a new regional
market contiguous to the existing network. 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 and depreciation
expense, divided by revenue. Although OR is not a recognized financial measure
defined by GAAP, it is a widely recognized measure in the transportation
industry which the Company believes provides a comparable benchmark for
evaluating its 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: For the three months ended June 30
    
    For the six months ended June 30(in thousands)
    
    2004
    
    2003
    
    2004
    
    2003Operating expenses
    
    $
    78,665
    
    
    $
    70,655
    
    
    $
    154,239
    
    
    $
    137,739Selling, general and
administrative expenses
    
    
    8,201
    
    
    
    8,042
    
    
    
    16,364
    
    
    
    14,975Depreciation expense
    
    
    1,232
    
    
    
    1,364
    
    
    
    2,540
    
    
    
    2,733$
    88,098
    
    
    $
    80,061
    
    
    $
    173,143
    
    
    $
    155,447Revenue
    
    $
    93,931
    
    
    $
    84,135
    
    
    $
    181,077
    
    
    $
    161,600Operating ratio (OR)
    
    
    93.8
    %
    
    
    95.2
    %
    
    
    95.6
    %
    
    
    96.2
    %
  (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 (tonnage) represents the total pounds shipped by each LTL business
unit.  (4)
    
    Revenue per mile represents TL revenue divided by the total number of
miles for the period.  (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)
    
    Empty miles represents the number of miles driven during the period
without a loaded shipment by a TL segment owner operator.  (7)
    
    Total miles represents the sum of empty miles and loaded shipment miles
driven during the period by a TL segment owner operator. Kevin Glass
Vice President Finance &  Chief
     Financial Officer
    July 20, 2004
 17




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##### 



Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company is exposed to the impact of interest rate changes. The Company is
exposed to changes in interest rates on its borrowings under the term bank
facility that has a variable interest rate tied to the LIBOR rate. The term
bank credit facility of $22.3 million had a weighted-average interest rate on
borrowings of 2.53% in the first six months of 2004. We estimate that the fair
value of the term credit facility approximates the carrying value. (in thousands of dollars)
    
    Payments due by periodLong-term debt
    
    Total
    
    2004
    
    2005 & 2006
    
    2007 & 2008
    
    ThereafterVariable RateTerm bank facility
    
    $
    22,159
    
    
    $
    4,324
    
    
    $
    17,835
    
    
    $
    Nil
    
    
    $
    NilAverage interest rate
    
    
    2.53
    %
    
    
    2.53
    %
    
    
    2.53
    %Fixed RateCapital lease obligation
    
    
    106
    
    
    
    13
    
    
    
    56
    
    
    
    37
    
    
    NilAverage interest rate
    
    
    6.79
    %
    
    
    6.79
    %
    
    
    6.79
    %
    
    
    6.79
    %Total
    
    $
    22,265
    
    
    $
    4,337
    
    
    $
    17,891
    
    
    $
    37
    
    
    $Nil
 The Companys investment of Cdn $35.3 million in marketable securities is
invested in short-term, highly rated government securities, treasury bills and
investment grade commercial paper and realized average returns of 2.24% for the
six months of 2004. Item 4. Controls and Procedures  a)
    
    As of July 20, 2004, 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 June 30, 2004 and six-month period ended June 30, 2004.
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. 18




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##### 



Part II. Other Information Item 1. Legal Proceedings There exists certain legal actions against the Company, none of which is
expected to have a material adverse effect on the consolidated financial
position or results of operations of the Company. Item 2. Changes in Securities and Use of Proceeds In December of 2003 Vitran, using Avondale Partners as the lead underwriting
firm, issued 2,300,000 Class A Voting common shares for gross proceeds of $31.6
million in a public offering. Commissions to the underwriters amounted to $1.6
million and other expenses of the offering amounted to $0.6 million resulting
in net proceeds of $29.4 million. As of June 30, 2004, it is still the
intention of Vitrans management to use the net proceeds from the public
offering to fund possible future acquisitions, capital expenditures and repay
amounts outstanding under credit facilities. Item 3. Defaults Upon
Senior Securities  None Item 4. Submission of Matters to a Vote of Security Holders   None Item 5. Other Information  None Item 6. Exhibits and Reports on Form 8-K  (a)
    
    Exhibits ExhibitNumber
    
    Description of Exhibit31
    
    Certifications pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002, dated July 20, 2004.32
    
    Certifications pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, dated July 20, 2004.
  (b)
    
    Reports on Form 8-K i) Vitran Corporation Inc. filed a Current Report on Form 8-K dated April
30, 2004 related to a press release to update investors that shareholders
approved two new directors at the Companys annual meeting. ii) Vitran Corporation Inc. filed a Current Report on Form 8-K dated
April 30, 2004 related to a press release to update investors that
the Company will trade under a new stock symbol on the Toronto Stock
Exchange. 19




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##### 



iii) Vitran Corporation Inc. filed a Current Report on Form 8-K dated
April 30, 2004 related to articles of amendment. iv) Vitran Corporation Inc. filed a Current Report on Form 8-K dated
April 30, 2004 related to an employment agreement between the Company
and Rick E. Gaetz. v) Vitran Corporation Inc. filed a Current Report on Form 8-K dated April
30, 2004 related to an employment agreement between the Company and the
Kevin A. Glass. vi) Vitran Corporation Inc. filed a Current Report on Form 8-K dated July
23, 2004 related to its financial results for the second quarter of
2004. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized. VITRAN CORPORATION INC./s/ KEVIN A. GLASSKevin A. GlassDate: July 20, 2004
    
    Vice President of Finance andChief Financial Officer(Principle Financial Officer)/s/ SEAN WASHCHUKSean WashchukDate: July 20, 2004
    
    Corporate Controller(Principle Accounting Officer)
 20