Mullen Group Ltd. — Interim / Quarterly Report 2022

Jul 21, 2022

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JUNE 30, 2022

INTERIM FINANCIAL REPORT

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(unaudited) (thousands) June 30 Note 2022	December 31 2021
Assets Current assets: Trade and other receivables 6 $ 316,706 $ Inventory 40,753 Prepaid expenses 25,929 Current tax receivable 4,732	248,868 35,121 19,074 6,046
388,120 Non-current assets: Property, plant and equipment 984,967 Right-of-use assets 92,453 Goodwill 371,131 Intangible assets 99,845 Investments 42,637 Deferred tax assets 8,512 Derivative financial instruments 7 37,641 Other assets 8 2,118	309,109 985,971 78,032 358,726 99,155 38,518 9,630 37,392 5,463
1,639,304	1,612,887
Total Assets $ 2,027,424 $	1,921,996
Liabilities and Equity Current liabilities: Bank indebtedness 11 $ 146,703 $ Accounts payable and accrued liabilities 154,397 Dividends payable 9 5,582 Current tax payable 4,364 Lease liabilities – current portion 18,914 Currentportion of long-term debt 11 56	89,045 144,198 3,781 3,338 17,890 54
330,016 Non-current liabilities: Convertible debentures – debt component 11 114,632 Long-term debt 11 466,328 Lease liabilities 77,316 Asset retirement obligations 1,629 Deferred tax liabilities 132,907	258,306 113,458 461,505 63,363 1,616 135,084
792,812 Equity: Share capital 12 843,409 Convertible debentures – equity component 9,116 Contributed surplus 19,158 Accumulated other comprehensive income 1,521 Retained earnings 31,392	775,026 853,614 9,116 22,578 1,088 2,268
904,596	888,664
Subsequent event 19
Total Liabilities and Equity $ 2,027,424 $	1,921,996

The notes which begin on page 42 are an integral part of these condensed interim consolidated financial statements.

Approved by the Board of Directors on July 20, 2022, after review by the Audit Committee.

"Signed: Murray K. Mullen"

Murray K. Mullen, Director

"Signed: Philip J. Scherman" Philip J. Scherman, Director

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2022 SECOND QUARTER INTERIM REPORT

38

CONDENSED CONSOLIDATED STATEMENT OF INCOME

(unaudited) (thousands, except per share amounts) Note	Three month periods ended June 30 2022 2021	Six month periods ended June 30	Six month periods ended June 30
		2022	2021
Revenue 15 Direct operating expenses Sellingand administrative expenses	$ 521,564 $ 312,455 366,798 212,158 60,877 41,315	$ 978,437 703,883 120,397	$ 602,962 417,038 79,870
Operating income before depreciation and amortization Depreciation of property, plant and equipment Depreciation of right-of-use assets Amortization of intangible assets Finance costs Net foreign exchange loss (gain) 7 Other(income)expense 16	93,889 58,982 17,501 17,096 5,952 3,188 4,366 5,151 8,805 7,166 1,232 (1,144) (1,411) (1,019)	154,157 34,821 11,648 8,995 16,828 4,514 (2,993)	106,054 33,904 6,206 10,165 14,189 (1,276) (1,890)
Income before income taxes Income tax expense 10	57,444 28,544 14,839 6,835	80,344 21,290	44,756 10,087
Net income and total comprehensive income	$ 42,605 $ 21,709	$ 59,054	$ 34,669
Earnings per share: 13 Basic Diluted	$ 0.46 $ 0.23 $ 0.43 $ 0.23	$ 0.63 $ 0.61	$ 0.36 $ 0.36
Weighted average number of Common Shares outstanding: 13 Basic Diluted	93,410 96,259 102,419 96,338	93,795 102,796	96,553 96,577

The notes which begin on page 42 are an integral part of these condensed interim consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(unaudited) (thousands)	Three month periods ended June 30 2022 2021	Six month periods ended June 30	Six month periods ended June 30
		2022	2021
Net income Other comprehensive income Items that may be reclassified subsequently to statement of income Exchange differences from translating foreign operations	$ 42,605 $ 21,709 829 —	$ 59,054 433	$ 34,669 —
Other comprehensive income, net of tax	829 —	433	—
Total comprehensive income	$ 43,434 $ 21,709	$ 59,487	$ 34,669

The notes which begin on page 42 are an integral part of these condensed interim consolidated financial statements.

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2022 SECOND QUARTER INTERIM REPORT

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CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

	ED STATEMENT OF CHANGES IN	ED STATEMENT OF CHANGES IN
	Convertible debentures – equity component Contributed surplus Accumulated Other Comprehensive Income
Balance at January 1, 2022 $ 853,614 Net income for the period — Other comprehensive income, net of tax — Common Shares repurchased 12 (10,205) Stock-based compensation expense — Dividends declared to common shareholders 9 —	$ 9,116 $ 22,578 $ 1,088 $ — — — — — 433 — (3,748) — — 328 — — — —	2,268 $ 888,664 59,054 59,054 — 433 — (13,953) — 328 (29,930) (29,930)
Balance at June 30, 2022 $ 843,409	$ 9,116 $ 19,158 $ 1,521 $	31,392 $ 904,596

	Convertible debentures – equity component Contributed surplus Accumulated Other Comprehensive Income	Convertible debentures – equity component Contributed surplus Accumulated Other Comprehensive Income
Balance at January 1, 2021 $ 874,888 Net income for the period — Other comprehensive income, net of tax — Common Shares repurchased 12 (14,732) Common Shares issued on acquisition 9,413 Stock-based compensation expense — Dividends declared to common shareholders 9 —	$ 9,116 $ 36,577 $ — $ — — — — — — — (6,393) — — — — — 161 — — — —	(24,163) $ 896,418 34,669 34,669 — — — (21,125) — 9,413 — 161 (23,141) (23,141)
Balance at June 30, 2021 $ 869,569	$ 9,116 $ 30,345 $ — $	(12,635) $ 896,395

The notes which begin on page 42 are an integral part of these condensed interim consolidated financial statements.

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2022 SECOND QUARTER INTERIM REPORT

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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited) (thousands) Note	Six month periods ended June 30	Six month periods ended June 30
	2022	2021
Cash provided by (used in): Cash flows from operating activities: Net income Adjustments for: Depreciation and amortization Finance costs Stock-based compensation expense Foreign exchange (gain) loss on cross-currency swaps 7 Foreign exchange loss (gain) Other (income) expense 16 Income tax expense 10	$ 59,054 55,464 16,828 328 (249) 4,763 (2,993) 21,290	$ 34,669 50,275 14,189 161 6,464 (6,358) (1,890) 10,087
Cash flows from operating activities before non-cash working capital items Changes in non-cash workingcapital items from operatingactivities 17	154,485 (65,218)	107,597 5,725
Cash generated from operating activities Income taxpaid	89,267 (22,468)	113,322 (18,488)
Net cash from operatingactivities	66,799	94,834
Cash flows from financing activities: Bank indebtedness 11 Repurchase of Common Shares 12 Cash dividends paid to common shareholders Interest paid Repayment of long-term debt and loans 5 Repayment of lease liabilities Changes in non-cash workingcapital items from financingactivities 17	57,658 (18,363) (28,129) (15,728) (8,469) (11,080) 36	73,738 (17,875) (22,199) (13,244) (22) (6,634) (58)
Net cash(used in)from financingactivities	(24,075)	13,706
Cash flows from investing activities: Acquisitions net of cash acquired 5 Purchase of property, plant and equipment Proceeds on sale of property, plant and equipment Net investment in finance leases Interest received Other assets Dividend from equity investee Changes in non-cash workingcapital items from investingactivities 17	(21,434) (33,249) 9,140 146 201 3,366 128 (673)	(184,639) (25,295) 9,579 729 265 (13,174) — 37
Net cash used in investingactivities	(42,375)	(212,498)
Change in cash and cash equivalents Cash and cash equivalents at January 1 Effect of exchange rate fluctuations on cash held	349 — (349)	(103,958) 105,340 (1,382)
Cash and cash equivalents at June 30	$ —	$ —

The notes which begin on page 42 are an integral part of these condensed interim consolidated financial statements.

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2022 SECOND QUARTER INTERIM REPORT

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

1. Reporting Entity

Mullen Group Ltd. (" Mullen Group " and/or the " Corporation ") was incorporated pursuant to the laws of the Province of Alberta and is a publicly-traded company listed on the Toronto Stock Exchange (" TSX ") under the symbol 'MTL'. The Corporation maintains its registered office in Okotoks, Alberta, Canada. The business of Mullen Group is operated through wholly-owned (either directly or indirectly) subsidiaries and limited partnerships (" Business Units "). The Corporation is recognized as one of the leading suppliers of trucking and logistics services in Canada providing a wide range of service offerings including less-than-truckload, truckload, warehousing, logistics, transload, oversized and specialized hauling transportation. The Corporation also operates as a third-party logistics provider in the U.S. In addition, Mullen Group provides a diverse set of specialized services related to the energy, mining, forestry and construction industries in western Canada, including water management, fluid hauling and environmental reclamation. These unaudited condensed interim consolidated financial statements (" Interim Financial Statements ") include the accounts of the Corporation, its subsidiaries and its limited partnerships.

2. Basis of Presentation

• (a) Statement of Compliance

These Interim Financial Statements have been prepared in accordance to and comply with International Financial Reporting Standards (" IFRS "), which include the International Accounting Standards (" IAS ") and the interpretations developed by the International Financial Reporting Interpretations Committee (" IFRIC "), as issued by the International Accounting Standards Board (" IASB "). These Interim Financial Statements comply with IAS 34 Interim Financial Reporting and do not include all of the information required for annual financial statements.

• (b) Basis of Measurement

These Interim Financial Statements have been prepared on the historical cost basis except for investments (excluding investments accounted for by the equity method), and derivative financial instruments (" Derivatives "), which are measured at fair value through profit or loss.

• (c) Functional and Presentation Currency

These Interim Financial Statements are presented in Canadian dollars, which is the functional currency of the Corporation. All financial information presented in Canadian dollars has been rounded to the nearest thousand except for per share amounts.

3. Significant Accounting Policies

The accompanying Interim Financial Statements should be read in conjunction with Note 3 to Mullen Group's audited annual consolidated financial statements for the year ended December 31, 2021, (the " Annual Financial Statements ") as the accounting policies applied by the Corporation in these Interim Financial Statements are the same as those disclosed therein.

4. Determination of Fair Values

The following table compares the fair value of certain financial assets and financial liabilities to its corresponding carrying amount as presented in the condensed consolidated statement of financial position.

Investments (excluding investments accounted for by using the equity method) Level 1 $ 2,497 Derivative Financial Instruments(1) Level 2 $ 37,641 Private Placement Debt Level 2 $ 465,515 Convertible Debentures – debt component Level 2 $ 114,632	$ 2,497 $ 37,641 $ 424,175 $ 112,625

(1) The fair value of the Derivative Financial Instruments is determined using Level 2 of the fair value hierarchy. Level 2 fair values are determined by referencing observable market data, including future foreign currency curves, interest rates, credit spreads and other financial measures.

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2022 SECOND QUARTER INTERIM REPORT

42

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

5. Acquisitions

2022 Acquisitions

Willy's Trucking Service – On May 1, 2022, Mullen Group acquired all of the issued and outstanding shares of 1297683 Alberta Ltd., which operates as Willy's Trucking Service (" Willy's ") for total cash consideration of $18.9 million, including three owned facilities. Mullen Group recognized $17.8 million of cash used to acquire Willy's on its condensed consolidated statement of cash flows, which consists of $18.9 million of cash consideration paid on closing net of $1.1 million of cash acquired. Mullen Group also repaid $8.4 million of long-term debt and shareholder loans on the closing date. Willy's is a privately held company headquartered in Edmonton, Alberta and provides regional LTL, general freight and logistic services across northern Alberta and northeastern British Columbia. Mullen Group acquired Willy's as part of its strategy to invest in the transportation sector by acquiring companies that have a strong regional presence. The financial results of Willy's are included within the Less-Than-Truckload segment.

Monarch Messenger Services Ltd. – Effective January 1, 2022, Mullen Group acquired the assets and business of Monarch Messenger Services Ltd. (" Monarch ") for total cash consideration of $3.7 million. Monarch is a privately held company headquartered in Calgary, Alberta and provides courier and small package delivery transportation services as well as ambient temperature controlled freight in Alberta. The acquisition of the assets and business of Monarch aligns with Mullen Group's strategy of acquiring transportation and logistics companies that have a strong regional presence. The financial results of Monarch were integrated into DirectIT Group of Companies which is included within the Less-Than-Truckload segment and Caneda Transport Ltd., which is included within the Logistics & Warehousing segment.

These acquisitions have been accounted for by the acquisition method, and results of operations have been included in these Interim Financial Statements from the date of acquisition. The goodwill acquired in these acquisitions primarily relates to the assembled workforce and the synergies from the integration of the acquired businesses.

Willy's Monarch	Total
Assets: Non-cash working capital items $ (809) $ — Property, plant and equipment 8,921 1,994 Right-of-use assets 2,122 — Intangible assets 8,970 460 Goodwill 10,686 1,235	$ (809) 10,915 2,122 9,430 11,921
29,890 3,689 Assumed liabilities: Lease liabilities (long-term portion) 1,250 — Deferred income taxes 2,456 — Due to shareholder 3,400 — Long-term debt 5,039 —	33,579 1,250 2,456 3,400 5,039
12,145 — Net assets before cash and cash equivalents 17,745 3,689 Cash and cash equivalents acquired 1,118 —	12,145 21,434 1,118
Net assets 18,863 3,689	22,552
Consideration: Cash 18,863 3,689	22,552
$ 18,863 $ 3,689	$ 22,552

Due to the limited time between the closing of these acquisitions and the preparation of these Interim Financial Statements, the value of the assets acquired and the liabilities assumed are based upon preliminary financial information available to management as of the date of this report and are subject to change.

6. Trade and Other Receivables

June 30 2022 Trade receivables $ 278,593 $ Other receivables 34,185 Net investment in finance leases 305 Contract assets 3,623 $ 316,706 $	December 31 2021
	214,480 31,741 364 2,283
	248,868

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2022 SECOND QUARTER INTERIM REPORT

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

7. Derivative Financial Instruments

On July 25, 2014, Mullen Group entered into two cross-currency swap contracts with a Canadian bank to swap $117.0 million U.S. dollars and $112.0 million U.S. dollars into Canadian dollars (collectively, the " Cross-Currency Swaps ") at foreign exchange rates of $1.1047 and $1.1148 that mature on October 22, 2024 and October 22, 2026, respectively. These Cross-Currency Swaps provide an economic hedge on the principal amount of the Series G and Series H Notes.

For the six month period ended June 30, 2022, Mullen Group has recorded a net foreign exchange loss (gain) of $4.5 million (2021 – $(1.3) million). This was due to the impact of the change over the period in the value of the Canadian dollar relative to the U.S. dollar on the Corporation's U.S. dollar debt and from the change in the fair value of its Cross-Currency Swaps as summarized in the table below:

Net Foreign Exchange Loss (Gain)	Six month periods ended June 30	Six month periods ended June 30
	CDN. $ Equivalent
	2022	2021
Foreign exchange loss (gain) on U.S. $ debt Foreign exchange(gain)loss on Cross-CurrencySwaps	$ 4,763 $ (249)	(7,740) 6,464
Net foreign exchange loss (gain)	$ 4,514 $	(1,276)

For the six month period ended June 30, 2022, Mullen Group recorded a foreign exchange loss (gain) on U.S. dollar debt of $4.7 million (2021 – $(7.7) million) as summarized in the table below:

Foreign Exchange Loss (Gain) on U.S. $ Debt ($ thousands, except exchange rate amounts)		Six month periods e	nded June 30	nded June 30
	2022	CDN. $ Equivalent		2021
	U.S. $ Debt Exchange Rate		U.S. $ Debt	Exchange Rate	CDN. $ Equivalent
Ending – June 30 Beginning– January1	229,000 1.2886 229,000 1.2678	295,089 290,326	229,000 229,000	1.2394 1.2732	283,823
					291,563
Foreign exchange loss (gain) on U.S. $ debt		4,763			(7,740)

For the six month period ended June 30, 2022, Mullen Group recorded a foreign exchange (gain) loss on its Cross-Currency Swaps of $(0.2) million (2021 – $6.5 million). This was due to the change over the period in the fair value of these Cross-Currency Swaps as summarized in the table below:

Foreign Exchange (Gain) Loss on Cross-Currency Swaps		Six month periods ended June 30	Six month periods ended June 30
		2022 CDN. $ Change in Fair Value **of Swaps **		2021
	U.S. $ Swaps		U.S. $ Swaps	CDN. $ Change in Fair Value **of Swaps **
Cross-Currency Swap maturing October 22, 2024 Cross-CurrencySwapmaturingOctober 22, 2026	117,000 112,000	(163) (86) (249)	117,000 112,000	3,366
				3,098
Foreign exchange (gain) loss on Cross-Currency Swaps				6,464

8. Other Assets

Other Assets
June 30 2022	December 31 2021
Promissory notes $ 65 $ Net investment in finance leases(1) 110 Deposit on acquisition(2) — Other 1,943	651 89 3,406 1,317
$ 2,118 $	5,463

(1) Net investment in finance leases includes amounts owing after 12 months and mainly consists of the net investment in subleases on real property where the Business Unit has entered into the head lease.

(2) Deposit on acquisition in 2021 consisted of amounts funded to close the January 1, 2022, acquisition of Monarch.  For more information, refer to Note 5 .

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2022 SECOND QUARTER INTERIM REPORT

44

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

9. Dividends Payable

For the six month period ended June 30, 2022, Mullen Group declared dividends totalling $0.32 per Common Share (2021 – $0.24 per Common Share). On December 8, 2021, Mullen Group announced its intention to pay annual dividends of $0.60 per Common Share ($0.05 per Common Share on a monthly basis) for 2022. On May 3, 2022, Mullen Group announced an increase to the monthly dividend from $0.05 to $0.06 per Common Share effective as of the next regular dividend payment, which was payable on June 15, 2022. At June 30, 2022, Mullen Group had 93,025,932 Common Shares outstanding and a dividend payable of $5.6 million (December 31, 2021 – $3.8 million), which was paid on July 15, 2022. Mullen Group also declared a dividend of $0.06 per Common Share on July 19, 2022, to the holders of record at the close of business on July 31, 2022.

10. Income Taxes

The following table provides a reconciliation of the effective tax rates based on the applicable tax rates in various jurisdictions during the period.

	Three month periods ended June 30 2022 2021	Six month periods ended June 30	Six month periods ended June 30
		2022	2021
Income before income taxes Combined statutory tax rate Expected income tax Add (deduct): Non-deductible (taxable) portion of net foreign exchange loss (gain) Non-deductible (taxable) portion of the change in fair value of investments Stock-based compensation expense Changes in unrecognized deferred tax asset Other	$ 57,444 $ 28,544 25% 25% 14,361 7,136 142 (132) 13 (72) 43 22 142 — 138 (119)	$ 80,344 25% 20,086 519 (13) 76 519 103	$ 44,756 25% 11,189 (147) (123) 37 (936) 67
Income tax expense	$ 14,839 $ 6,835	$ 21,290	$ 10,087

11. Long-Term Debt, Credit Facilities and Convertible Unsecured Subordinated Debentures

Mullen Group has two unsecured credit facilities to borrow an aggregate of up to $250.0 million with its $150.0 million unsecured credit facility with the Royal Bank of Canada (the " RBC Credit Facility ") and its $100.0 million unsecured credit facility with the Canadian Imperial Bank of Commerce (the " CIBC Credit Facility "). Interest on the RBC Credit Facility is payable monthly and is based on either the bank prime rate plus 0.50 percent or bankers' acceptance rates plus an acceptance fee of 1.50 percent. Interest on the CIBC Credit Facility is based on either the Canadian bank prime rate plus 0.50 percent or the U.S. bank base rate plus 0.50 percent, in each case payable in arrears or bankers' acceptance rates plus an acceptance fee of 1.50 percent payable upon acceptance. As at June 30,2022, there was $142.2 million drawn on the CIBC Credit Facility and the RBC Credit Facility (collectively, the " Credit Facilities "), which was included within bank indebtedness on the condensed consolidated statement of financial position. These Credit Facilities are unsecured although the Corporation's wholly-owned subsidiary, MT Investments Inc. (" MT "), has granted an unlimited guarantee of any indebtedness owing on the Credit Facilities. These Credit Facilities do not have any financial covenants, however, Mullen Group cannot be in default of its Private Placement Debt and it must be in compliance with certain reporting and general covenants. Mullen Group is in compliance with all of these reporting and general covenants.

Mullen Group has $4.0 million of letters of credit outstanding, which were issued to guarantee certain performance and payment obligations. These letters of credit reduce the amount available under the RBC Credit Facility.

Mullen Group's long-term debt is mainly comprised of a series of unsecured debt (collectively, the " Private Placement Debt "), the details of which are set forth below:

w:
Notes	Principal amount Maturity Interest Rate(1)
Series G $ Series H $ Series I $ Series J $ Series K $ Series L $	117,000 U.S. October 22, 2024 3.84% 112,000 U.S. October 22, 2026 3.94% 30,000 CDN. October 22, 2024 3.88% 3,000 CDN. October 22, 2026 4.00% 58,000 CDN. October 22, 2024 3.95% 80,000 CDN. October 22, 2026 4.07%

(1) Interest is payable semi-annually.

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2022 SECOND QUARTER INTERIM REPORT

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

Mullen Group's unamortized debt issuance costs of $0.6 million related to its Private Placement Debt have been netted against its carrying value at June 30, 2022 (December 31, 2021 – $0.7 million). Mullen Group has certain financial covenants that must be met under its unsecured Private Placement Debt, which include a total net debt to operating cash flow ratio and a total earnings available for fixed charges to total fixed charges ratio. Mullen Group's total net debt cannot exceed 3.5 times operating cash flow calculated using the trailing twelve months financial results normalized for acquisitions. The term " total net debt " is defined in the Private Placement Debt agreement as all debt excluding the Debentures less any unrealized gain on Cross-Currency Swaps plus any unrealized loss on Cross-Currency Swaps, as disclosed within Derivatives on the condensed consolidated statement of financial position but includes Private Placement Debt, lease liabilities, the Credit Facilities and letters of credit. The term " operating cash flow " is also defined in the Private Placement Debt agreement and means, for any quarterly period, the trailing twelve month consolidated net income adjusted for all amounts deducted in the computation thereof on account of (i) taxes imposed on or measured by income or excess profits, (ii) depreciation and amortization taken during such period, (iii) total interest charges, including interest on the Debentures and lease liabilities; and (iv) non-cash charges. Mullen Group cannot have a fixed charge coverage ratio less than 1.75:1 calculated using the trailing twelve months financial results. Mullen Group is in compliance with all the Private Placement Debt financial covenants.

Mullen Group entered into Cross-Currency Swaps to swap the Series G and Series H Notes into Canadian dollars at foreign exchange rates of $1.1047 and $1.1148 that mature on October 22, 2024 and October 22, 2026, respectively.  For more information, refer to Note 7 .

The following table summarizes the Corporation's total debt:

June 30, 2022	December 31, 2021
Current liabilities: Private Placement Debt $ — $ Lease liabilities – current portion 18,914 Current portion of long-term debt 56 Bank indebtedness 146,703	— 17,890 54 89,045
165,673 Non-current liabilities: Private Placement Debt 465,515 Lease liabilities 77,316 Long-term debt 813	106,989 460,660 63,363 845
543,644	524,868
$ 709,317 $	631,857

The details of total debt, as at the date hereof, are as follows:

Year of Maturity	Interest Rate	June 30, 2022 Face Value Carrying Amount	December 31, 2021	December 31, 2021
			Face Value	Carrying Amount
Bank indebtedness — Lease liabilities 2022 – 2028 Private Placement Debt 2024 – 2026 Various financingloans 2024	Variable 3.20% 3.84% - 4.07% 3.31%	$ $	$	$
		146,703 146,703 112,473 96,230 466,089 465,515 869 869	89,045 94,147 461,326 899	89,045 81,253 460,660 899
		726,134 709,317	645,417	631,857

In addition, Mullen Group has an aggregate principal amount of $125.0 million of convertible unsecured subordinated debentures (the " Debentures "). The Debentures mature on November 30, 2026 and are publicly listed on the TSX under 'MTL.DB'. The Debentures bear interest at a rate of 5.75 percent per annum, payable semi-annually in arrears on May 31 and November 30 of each year. The carrying amount of the debt component of the Debentures at June 30, 2022, was $114.6 million (December 31, 2021 – $113.5 million).

12. Share Capital

The authorized share capital of Mullen Group consists of an unlimited number of no par value Common Shares and an unlimited number of Preferred Shares, issuable in series.

The number of, and the specific rights, privileges, restrictions and conditions attaching to any series of Preferred Shares shall be determined by the Board of Directors (the " Board ") of Mullen Group prior to the creation and issuance thereof. With respect to the payment of dividends and distribution of assets in the event of liquidation, dissolution or winding-up of Mullen Group, whether voluntarily or involuntarily, the Preferred Shares are entitled to preference over the Common Shares and any other shares ranking junior to the Preferred Shares from time to time and may also be given such other preferences over the Common Shares and any other shares ranking junior to the Preferred Shares as may be determined at the time of creation of such series. As at the date hereof, no series of Preferred Shares had been created.

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2022 SECOND QUARTER INTERIM REPORT

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

All of the issued Common Shares of Mullen Group have been paid in full.

	2022	2021
Issued Common Shares at January 1 Common Shares repurchased and cancelled Common Shares issued on acquisition	94,532,178 (1,506,246) —	96,852,047 (1,394,952) 750,000
Issued Common Shares at June 30	93,025,932	96,207,095

Mullen Group had a normal course issuer bid (" NCIB "), commencing March 9, 2021, to purchase for cancellation up to 7,928,623 Common Shares in the open market on or before March 8, 2022. On March 7, 2022, Mullen Group commenced the renewal of its NCIB commencing March 10, 2022, to purchase for cancellation up to 8,828,623 Common Shares in the open market on or before March 9, 2023. For the six month period ending June 30, 2022, Mullen Group had purchased and cancelled 1,506,246 Common Shares for $18.4 million under its NCIB programs. Mullen Group has also repurchased 119,535 Common Shares that are scheduled to be cancelled in July 2022.

All purchases were made in accordance with the NCIB at prevalent market prices as permitted by the Toronto Stock Exchange, with consideration allocated to share capital up to the average carrying amount of the shares and any excess allocated to contributed surplus. The NCIB can be cancelled at the discretion of the Corporation at any time.

13. Earnings per Share

• (a) Basic Earnings per Share

Basic earnings per share is calculated as net income attributable to common shareholders divided by the weighted average number of Common Shares outstanding for the period. Net income attributable to common shareholders for the three and six month periods ended June 30, 2022, were $42.6 million and $59.1 million (2021 – $21.7 million and $34.7 million), respectively. The weighted average number of Common Shares outstanding for the three and six month periods ended June 30, 2022 and 2021 was calculated as follows:

Note	Three month periods ended June 30 2022 2021	Six month periods ended June 30	Six month periods ended June 30
		2022	2021
Issued Common Shares at beginning of period 12 Effect of Common Shares repurchased and cancelled 12 Effect of Common Shares issued on acquisition	93,605,217 96,583,787 (195,318) (382,049) — 57,692	94,532,178 (736,930) —	96,852,047 (328,433) 29,005
Weighted average number of Common Shares at end of period – basic	93,409,899 96,259,430	93,795,248	96,552,619

• (b) Diluted Earnings per Share

Diluted earnings per share is calculated by adjusting net income attributable to common shareholders and the basic weighted average number of Common Shares outstanding by the effects of all potentially dilutive transactions to existing common shareholders. In calculating diluted earnings per share, net income was adjusted as follows:

	s of all potentially dilutive transactions to existing as follows:	s of all potentially dilutive transactions to existing as follows:	s of all potentially dilutive transactions to existing as follows:
	Three month periods ended June 30 2022 2021	Six month periods ended June 30
		2022	2021
Net income Effect of the Debentures	$ 42,605 $ 21,709 1,788 —	$ 59,054 3,575	$ 34,669 —
Net income – adjusted	$ 44,393 $ 21,709	$ 62,629	$ 34,669

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

The diluted weighted average number of Common Shares was calculated as follows:

	Shares was calculated as follows:	Shares was calculated as follows:	Shares was calculated as follows:
	Three month periods ended June 30 2022 2021
		2022	2021
Weighted average number of Common Shares – basic Effect of "in the money" stock options Effect of the Debentures	93,409,899 96,259,430 80,698 78,154 8,928,575 —	93,795,248 72,182 8,928,575	96,552,619 24,623 —
Weighted average number of Common Shares at end of period – diluted	102,419,172 96,337,584	102,796,005	96,577,242

For the three and six month periods ended June 30, 2022, 3,005,000 (2021 – 2,690,000) stock options were excluded from the diluted weighted average number of Common Shares calculation as their effect would have been anti-dilutive. The average market value of the Corporation's Common Shares for the purposes of calculating the dilutive effect of stock options was based on quoted market prices for the periods ended June 30, 2022 and 2021. For the three and six month periods ended June 30, 2022, the Common Shares that would be issued upon conversion of the Debentures were included in the diluted weighted average calculation as their effect was dilutive. For the three and six month periods ended June 30, 2021, the Common Shares that would be issued upon the conversion of the Debentures were excluded from the diluted weighted average calculation as their effect would have been anti-dilutive.

14. Seasonality of Operations

Revenue and profitability within the Less-Than-Truckload segment and the Logistics & Warehousing segment are generally lower in the first quarter than during the remainder of the year as freight volumes are typically lower in the first quarter following the holiday season due to less consumer demand and customers reducing shipments. Operating expenses also tend to increase within these segments in the winter months due to decreased fuel efficiency and increased repairs and maintenance expense resulting from cold weather conditions. The COVID-19 pandemic has had an impact on this typical pattern.

A significant portion of the operations within the Specialized & Industrial Services segment is comprised of a wide range of unique businesses providing specialized equipment and services to the oil and natural gas, environmental, construction, pipeline, utility, telecom and civil industries. Earnings are influenced by the seasonal activity pattern of western Canada's oil and natural gas exploration industry whereby activity usually peaks in the winter months and declines during the spring when wet weather and the spring thaw may make the ground unstable. Consequently, municipalities and provincial transportation departments enforce road bans that restrict the movement of heavy equipment, thereby reducing activity levels. Additionally, certain oil and natural gas producing areas are only accessible in the winter months because the ground surrounding the drilling sites in these areas consists of swampy terrain. Seasonal factors and unexpected weather patterns may lead to declines in the activity levels of exploration and production companies and corresponding declines in the demand for the goods and services provided by Mullen Group. As a result, the demand for these services is traditionally highest in the first quarter and lowest in the second quarter.

15. Revenue

The business of Mullen Group is operated through its Business Units, which are divided into four distinct operating segments for reporting purposes – Less-Than-Truckload, Logistics & Warehousing, Specialized & Industrial Services and U.S. & International Logistics. The segments are differentiated by the type of service provided, equipment requirements and customer needs. Mullen Group provides the capital and financial expertise, technology and systems support, shared services and strategic planning (the " Corporate Office ") for the Business Units. The Corporate Office also invests in certain public and private corporations. In addition, the Corporate Office, through its subsidiary MT, owns a network of real estate holdings and facilities that are leased primarily to the Business Units. Such properties are leased by MT to the Business Units on commercially reasonable terms. The day to day management of the Business Units is conducted at the subsidiary level.

At June 30, 2022, the Less-Than-Truckload segment consisted of 11 Business Units and is often referred to as the final or last mile delivery of general freight consisting of smaller shipments, packages and parcels. Through an extensive terminal network the pickup, handling and delivery of a wide range of freight including ambient, temperature controlled and consumer goods is coordinated from regional hubs located in Ontario and western Canada. We are committed to investing in the most advanced technologies available ensuring the continued improvement in all aspects of our business, shortening delivery times and providing customers with visibility, via tracking and tracing, to their shipments during transit.

At June 30, 2022, the Logistics & Warehousing segment consisted of 12 Business Units and provides shippers throughout North America with a wide range of trucking and logistics service offerings including full truckload, specialized transportation, warehousing, fulfillment centres that handle e- commerce transactions, and transload facilities designed for intermodal and bulk shipments. Operations and customer service are supported by a robust suite of leading edge technology solutions including a fully integrated transportation management system, customized inventory management and warehouse systems along with our proprietary Moveitonline[®] and Haulistic[TM] technology platforms, applications that are positioning our organization for an evolving and changing supply chain.

At June 30, 2022, the Specialized & Industrial Services segment consisted of 14 Business Units and is comprised of a wide range of unique businesses providing specialized equipment and services to the oil and natural gas, environmental, construction, pipeline, utility, telecom and civil industries. Strategically located throughout western Canada, these specialty Business Units are focused on providing advanced technology solutions and leading edge service capabilities.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

At June 30, 2022, the U.S. & International Logistics segment consisted of one Business Unit, being a global technology enabled, non-asset based third-party logistics service provider focused on freight brokerage services across multiple modes of transportation. The operations and customer service are provided through its proprietary transportation management system technology platform known as SilverExpress, which aligns customer shipments with transportation carriers.

Disaggregation of revenue:

The following tables detail Mullen Group's revenue by type of service and timing of the transfer of goods or services by segment:

Six month period ended June 30, 2022 Less-Than- Truckload	Logistics & Warehousing Specialized & Industrial Services U.S. & International Logistics Corporate Intersegment eliminations	Total
$	$ $ $ $ $	$
Revenue by service line Transportation 379,319 Logistics 14,370 Other(1) 2,850 Eliminations (10,224)	185,303 81,836 — — — 65,588 10,671 114,539 — — 50,973 93,040 — 2,640 — (2,669) (1,723) — — (8,076)	646,458 205,168 149,503 (22,692)
386,315	299,195 183,824 114,539 2,640 (8,076)	978,437
Timing of revenue recognition Over time 379,387 Point in time 17,152 Eliminations (10,224)	188,204 114,878 — 1,806 — 113,660 70,669 114,539 834 — (2,669) (1,723) — — (8,076)	684,275 316,854 (22,692)
386,315	299,195 183,824 114,539 2,640 (8,076)	978,437

(1) Included within other revenue is $23.7 million of rental revenue comprised of $0.1 million, $2.9 million, $18.9 million, nil and $1.8 million recorded in the Less-ThanTruckload segment, the Logistics & Warehousing segment, the Specialized & Industrial Services segment, the U.S. & International Logistics segment and Corporate, respectively.

	Logistics & Warehousing Specialized & Industrial Services U.S. & International Logistics Corporate Intersegment eliminations	Logistics & Warehousing Specialized & Industrial Services U.S. & International Logistics Corporate Intersegment eliminations
$	$ $ $ $ $	$
Revenue by service line Transportation 235,645 Logistics 12,794 Other(1) 2,842 Eliminations (3,927)	127,351 71,759 — — — 44,715 6,567 — — — 42,046 68,484 — 2,139 — (2,259) (1,091) — — (4,103)	434,755 64,076 115,511 (11,380)
247,354	211,853 145,719 — 2,139 (4,103)	602,962
Timing of revenue recognition Over time 235,765 Point in time 15,516 Eliminations (3,927)	129,529 98,036 — 1,712 — 84,583 48,774 — 427 — (2,259) (1,091) — — (4,103)	465,042 149,300 (11,380)
247,354	211,853 145,719 — 2,139 (4,103)	602,962

(1) Included within other revenue is $16.1 million of rental revenue comprised of $0.1 million, $2.2 million, $12.1 million, nil and $1.7 million recorded in the Less-ThanTruckload segment, the Logistics & Warehousing segment, the Specialized & Industrial Services segment, the U.S. & International Logistics segment and Corporate, respectively.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

16. Other (Income) Expense

	Three month periods ended June 30 2022 2021	Three month periods ended June 30 2022 2021	Three month periods ended June 30 2022 2021
		2022	2021
Change in fair value of investments Loss (gain) on sale of property, plant and equipment Gain on contingent consideration Earnings from equity investments Accretion on asset retirement obligations	$ 109 $ (624) 1,334 32 — (150) (2,861) (283) 7 6	$ (118) 1,241 — (4,129) 13	$ (1,066) (217) (150) (469) 12
Other (income) expense	$ (1,411) $ (1,019)	$ (2,993)	$ (1,890)

17. Changes in Non-Cash Working Capital

Changes in Non-Cash Working Capital
	Six month periods ended June 30
	2022	2021
Trade and other receivables Inventory Prepaid expenses Accountspayable and accrued liabilities	$ (65,500) $ (5,710) (6,557) 11,912	10,399 (2,852) (8,135) 6,292
	$ (65,855) $	5,704
	Six month periods ended June 30
	2022	2021
Changes in non-cash working capital items from: Operating activities Financing activities Investingactivities	$ (65,218) $ 36 (673)	5,725 (58) 37
	$ (65,855) $	5,704

18. Operating Segments

Mullen Group reports its financial results in four operating segments. These four operating segments have been differentiated by the sector of the economy in which the businesses operate, the type of services provided, the equipment requirements and the customer needs. The Less-ThanTruckload segment provides final or last mile delivery of general freight consisting of smaller shipments, packages and parcels. Through an extensive terminal network the pickup, handling and delivery of a wide range of freight including ambient, temperature controlled and consumer goods is coordinated from regional hubs located in Ontario and western Canada. The Logistics & Warehousing segment provides shippers throughout North America with a wide range of trucking and logistics service offerings including full truckload, specialized transportation, warehousing, fulfillment centres that handle e-commerce transactions, and transload facilities designed for intermodal and bulk shipments. The Specialized & Industrial Services segment provides specialized equipment and services to the oil and natural gas, environmental, construction, pipeline, utility, telecom and civil industries. The U.S. & International Logistics segment provides third-party logistics services focused on freight brokerage across multiple modes of transportation.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

The following tables provide financial results by segment:

	Less- Than- Truckload Logistics & Warehousing	Specialized & Industrial Services U.S. & International Logistics Corporate	Specialized & Industrial Services U.S. & International Logistics Corporate	Specialized & Industrial Services U.S. & International Logistics Corporate
			Less- Than- Truckload Logistics & Warehousing Specialized & Industrial Services
Revenue Income (loss) before income taxes Depreciation of property, plant and equipment Amortization of intangible assets Capital expenditures(1) Total assets at June 30, 2022	$ $	$ $ $	$ $ $	$ $
	210,676 156,726 27,399 20,716 5,017 3,935 2,093 1,732 5,915 5,172 577,098 409,863	100,557 57,262 1,732 10,535 636 (1,842) 6,560 479 1,510 110 431 — 4,887 — 3,877 386,243 79,159 575,061	(630) (1,031) (3,728) — — — — — — — — — (124) (803) (90) — — —	— 521,564 — 57,444 — 17,501 — 4,366 — 18,834 — 2,027,424

(1) Excludes business acquisitions.

Three month period ended June 30, 2021	Less- Than- Truckload Logistics & Warehousing	Specialized & Industrial Services U.S. & International Logistics Corporate	Intersegment eliminations	U.S. & International Logistics Total
			Less- Than- Truckload Logistics & Warehousing Specialized & Industrial Services
Revenue Income (loss) before income taxes Depreciation of property, plant and equipment Amortization of intangible assets Capital expenditures(1) Total assets at December 31, 2021	$ $	$ $ $	$ $ $	$ $
	126,691 120,504 12,233 15,104 3,980 3,345 1,922 1,885 5,211 3,138 517,659 366,624	66,424 — 1,277 2,390 — (1,183) 8,218 — 1,553 1,344 — — 4,480 — 233 385,411 80,816 571,486	(278) (1,270) (893) — — — — — — — — — — (135) (196) — — —	— 312,455 — 28,544 — 17,096 — 5,151 — 12,731 — 1,921,996

(1) Excludes business acquisitions.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

Six month period ended June 30, 2022	Less- Than- Truckload Logistics & Warehousing	Specialized & Industrial Services U.S. & International Logistics Corporate	Intersegment eliminations	U.S. & International Logistics Total
			Less- Than- Truckload Logistics & Warehousing Specialized & Industrial Services
Revenue Income (loss) before income taxes Depreciation of property, plant and equipment Amortization of intangible assets Capital expenditures(1) Total assets at June 30, 2022	$ $	$ $ $	$ $ $	$ $
	386,315 299,195 35,867 36,269 10,017 7,798 4,038 3,512 12,759 10,117 577,098 409,863	183,824 114,539 2,640 14,332 260 (6,384) 13,041 954 3,011 586 859 — 5,964 — 5,525 386,243 79,159 575,061	(1,146) (2,008) (4,922) — — — — — — — — — (124) (855) (137) — — —	— 978,437 — 80,344 — 34,821 — 8,995 — 33,249 — 2,027,424

(1) Excludes business acquisitions.

Six month period ended June 30, 2021	Less- Than- Truckload Logistics & Warehousing	Specialized & Industrial Services U.S. & International Logistics Corporate	Intersegment eliminations	U.S. & International Logistics Total
			Less- Than- Truckload Logistics & Warehousing Specialized & Industrial Services
Revenue Income (loss) before income taxes Depreciation of property, plant and equipment Amortization of intangible assets Capital expenditures(1) Total assets at December 31, 2021	$ $	$ $	$ $ $	$
	247,354 211,853 19,267 23,203 8,408 6,101 3,844 3,639 12,795 6,066 517,659 366,624	145,719 — 2,139 5,147 — (2,861) 16,330 — 3,065 2,682 — — 5,516 — 1,555 385,411 80,816 571,486	(477) (2,467) (1,159) — — — — — — — — — (55) (295) (287) — — —	— 602,962 — 44,756 — 33,904 — 10,165 — 25,295 — 1,921,996

(1) Excludes business acquisitions.

Performance is measured based on segment income before income tax, as included in the internal management reports that are reviewed by Mullen Group's Senior Executive Officer and President. Segment income is used to measure performance as management believes that such information is the most relevant in evaluating the results of segments relative to other entities that operate within these industries.

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NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS Three and six month periods ended June 30, 2022 and 2021 (unaudited) (Tabular amounts in thousands, except share and per share amounts)

The following geographical information is based upon the Business Unit's head office location for the six month period ended June 30, 2022.

	Operating Income Before Depreciation and Amortization Property, Plant and Equipment Total Non- Current Assets	Operating Income Before Depreciation and Amortization Property, Plant and Equipment Total Non- Current Assets
Canada $ 863,898 United States 114,539*	$ 150,877 $ 983,034 $ 1,590,971 3,280 1,933 48,333	$ 1,948,265 79,159
Total $ 978,437	$ 154,157 $ 984,967 $ 1,639,304	$ 2,027,424

* Commenced U.S. operations on June 30, 2021.

19. Subsequent Event

Subsequent to June 30, 2022, until the date of this report, the Corporation repurchased 119,535 Common Shares at a total cost of $1.3 million.

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