Titanium Transportation Group Inc. — Interim / Quarterly Report 2021

May 11, 2021

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Management's Discussion and Analysis

For the first quarter ended March 31, 2021

Dated May 11, 2021

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

GENERAL INFORMATION

The following is Titanium Transportation Group Inc.'s management discussion and analysis dated May 11, 2021 ("MD&A"), which provides a comparative overview of the Company's performance for its three month period ended March 31, 2021 with the corresponding three month period ended March 30, 2020, and it reviews the Company's financial position as at March 31, 2021. Throughout this MD&A, any reference to "Company", "we", "us", "our" or "Titanium" shall mean Titanium Transportation Group Inc. and all of its direct and indirect wholly-owned subsidiaries. This discussion should be read in conjunction with the Company's MD&A, audited consolidated financial statements and accompanying notes as at and for the year ended December 31, 2020 as well as the unaudited condensed consolidated interim financial statements of the Company for the first quarter ended March 31, 2021 ("consolidated interim financial statements").

The consolidated interim financial statements of the Company and extracts from those consolidated interim financial statements contained in this MD&A were prepared in accordance with International Financial Reporting Standards ("IFRS"). The consolidated interim financial statements comply with IAS 34, Interim Financial Reporting, and do not include all of the information required for annual financial statements. The Company's presentation currency is the Canadian dollar. All financial information presented has been rounded to the nearest dollar, except per share amounts and where otherwise indicated. The Company's consolidated interim financial statements for the first quarter ended March 31, 2021 were approved by its Board of Directors on May 11, 2021. Readers are cautioned that certain information included herein is forward-looking and based upon assumptions and anticipated results that are subject to uncertainties. Should one or more of these uncertainties materialize or should the underlying assumption prove incorrect, actual results may vary significantly from those expected. See "Forward Looking Statements" and "Risks and Uncertainties".

Unless otherwise indicated, the information in this report is dated as of May 11, 2021. Additional information relating to the Company is available on SEDAR at www.sedar.com.

OVERVIEW

The Company is an asset-based transportation and logistics company servicing Canada and the United States with terminals in Bolton, Bracebridge, Napanee, North Bay, Windsor Belleville, Cornwall, and Brantford, ON, with additional parking/switch yards in Sudbury, Brockville and Trenton, ON and freight brokerage offices in Charlotte, NC, Nashville, TN and Chicago, IL. The Company has over 1,000 customers across various industries, including large multinational corporations. The Company has approximately 800 power units, 3,000 trailers, and 1,100 independent owner operators and full-time employees.

The Truck Transportation segment provides transport of general merchandise by long-haul, dedicated and local trucking services throughout Canada and the U.S. with a variety of trailer types, including dry vans and flatbeds that support both heated and multi-axle services. Through the use of a modern fleet, the Truck Transportation segment provides reliable and high quality service to various customers, attains a high asset utilization through its network of terminals and yards across Ontario, and creates a platform for revenue growth and cost efficiencies through the integration of acquisitions.

The Logistics segment is a non-asset-based third-party logistics provider of ancillary transportation services, such as freight brokerage, North American and international freight forwarding, intermodal, special and expedited services. Through its network, the Logistics segment offers customers a variety of transportation services, including intermodal, international shipping, specialty services, and expedited services. The Logistics segment succeeds due to the extensive experience and expertise of the Company's dedicated personnel, up to date and innovative information technology and systems, as well as strong strategic relationships with thirdparty providers.

Titanium Transportation Group Inc.

Management's Discussion and Analysis for the first quarter ended March 31, 2021

The Company's operational results are influenced by industry-wide economic factors and by capital allocation including operating and spending decisions. Industry-wide economic factors which impact operational results include freight demand, truck capacity, fuel prices, driver availability, overall economic conditions, exchange rates, government regulation and weather. The Company makes key decisions when allocating capital between its Truck Transportation and Logistics segments, hiring employees or contract for services of independent contractors and determining sustainable compensation structures, investing in new equipment and technology, and considering business acquisitions. Operating and spending decisions are made after the analysis of numerous important financial and operational metrics including EBITDA[1] and operating income, revenue generated per truck and per mile, empty miles, driver retention and fuel efficiency.

Q1 2021 Key Highlights

• In line with our growth strategy, Titanium acquired all of the outstanding shares of International Truckload Services Group ("ITS") on February 5, 2021. ITS is a truckload carrier based in Belleville, ON with terminals in Cornwall and Brantford, ON.

• We have also completed a $25 million private placement on March 31, 2021. The bought deal sold 6,666,400 common shares at $3.75 per share.

• Consolidated revenue for Q1 2021 was $85.7 million, a 93.3% increase over Q1 2020. This represents the highest quarterly revenue in Company history, surpassing Q4 2020 revenue of $65.8 million. Expansion in the U.S. brokerage operations continued to be a key contributor to growth in our consolidated revenue. In addition, the contribution from the ITS acquisition totaled approximately $12.0 million in the quarter.

• Operating income was $2.6 million for Q1 2021, representing a 3.3% operating margin[1] , compared to $1.3 million and a 3.3% operating margin in Q1 2020.

• Titanium continued to strengthen its financial position in Q1 2021. The Company further lowered its netdebt-to-equity ratio to 1.01, from 1.14 on December 31, 2020.

• Truck Transportation segment revenue for Q1 2021 was $39.2 million, representing a 41.9% increase year over year. However, an operating loss was $0.6 million for an operating margin of negative 1.7% was recorded, compared to $1.4 million and 5.4%, respectively, in Q1 2020. A softening of operating margin is typical of an early post-acquisition period and will normalize as we move towards integration. Included in operating expenses was $0.3 million received from the Canadian Emergency Wage Subsidy ("CEWS") program.

• Logistics segment revenue was $47.5 million for Q1 2021, a 164.4% increase over the $18.0 million in the same period in 2020. Our strategic expansion into the US freight brokerage market contributed revenue of $32.4 million in Q1 2021. Operating income was $4.0 million, representing an 8.8% operating margin for the quarter. This compares to Q1 2020 operating income of $0.6 million and a 3.3% operating margin. The main factors contributing to the growth in the segment were the addition of logistics offices in Nashville, TN and Chicago, IL, combined with improving economic conditions in select U.S. markets.

	Revenue by Industry
	Manufactured Goods	28.6%
	Food & Beverage	22.6%
	Retail	11.7%
	Automotive	9.4%
	Logistics/Trucking Metals & Mining Services	7.7% 6.7% 5.2%
	Recycling	3.8%
	Other	4.3%
	Based on Q1 2021 revenue

1 Refer to "Results of Operations" on page 3 and "Non-IFRS Financial Measures" on page 14 for more information about EBITDA and for a reconciliation of EBITDA to net income.

Titanium Transportation Group Inc.

Management's Discussion and Analysis for the first quarter ended March 31, 2021

RESULTS OF OPERATIONS

Financial Highlights (unaudited)

Revenue Fuel surcharge Operating expenses EBITDA(1) EBITDA margin(1) Depreciation Amortization of customer lists Operating income(1) Operating margin(1) Gain on sale of property and equipment Finance costs Finance income Foreign exchange gain Transaction costs Gain on Sales of Investments Income tax expense Net income and comprehensive income attributable to owners of the Company Net income per share - basic Net income per share-diluted	3 months 3 months ended ended March 31 March 31 2021 2020
	79,521,104 40,795,278 6,153,600 3,516,965
	85,674,704 44,312,243 78,159,821 39,765,348
	7,514,883 4,546,895 % 9.5 % 11.1 4,792,420 3,160,528 114,293 57,150
	2,608,170 1,329,217 % 3.3 % 3.3 (71,850) (87,858) 816,086 776,817 (49,779) (137,754) 142,521 (147,708) 800,000 - (597,744) - 399,876 282,644
	1,169,060 643,076 0.03 0.02 0.03 0.02

(1) Refer to "Non-IFRS Financial Measures".

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

EXECUTIVE SUMMARY

The ongoing COVID-19 pandemic continued to impact our business during the first quarter. While the overall operating environment has continued to improve, activity levels continue to vary by region. Select U.S. markets have experienced significant economic recovery to levels at or above those experienced pre-COVID. Although they are also generally improving, a number of Canadian markets continue to experience relatively depressed levels of activity and challenging operating conditions reflecting ongoing COVID-19 impact and measures.

Notwithstanding the unique operating conditions prevailing in the first quarter, we are pleased with our solid Q1 results. Titanium delivered another quarter of record revenue reflecting the impact of our most recent acquisition and strong organic growth in our Logistics business. These results once again demonstrate our ability to adapt to evolving market conditions and the dedication and commitment of our employees and drivers to meeting the needs of our customers.

In the U.S. market, our freight brokerage operations capitalized on the improving economic landscape and we added a third office in Chicago, IL. While not yet fully operational during the quarter, the added location contributed positively to the continued significant growth in the segment. Overall, the U.S. Freight Brokerage operations have seen a 3,740% increase in net income compared to the same quarter in 2020. Looking ahead, we expect to capitalize on the improving business environment with at least two more offices in the U.S. in 2021.

The Q1 2021 Transportation Segment results include the first two months' impact of our acquisition of International Truckload Services Group (“ITS”) completed on February 5. ITS added 330 power units, 1,600 trailers, 470 employees and drivers and approximately $80 million in annual revenue. Integration of ITS is progressing well and as expected, significant synergies have been identified. Overall, the Truck Transportation segment experienced a decrease in EBITDA and profitability for the quarter reflecting the addition of the lower operating margins at ITS and challenging operating conditions including rising operating costs magnifying the effects of continued depressed activity levels in key Canadian markets. As we complete the ITS integration and realize synergies, the segment profitability is expected to return to more normal levels in the second half of 2021.

Our strong capital management continued as our net-debt-to-equity ratio decreased from 1.14 in December 2020 to 1.01 in March 2021 following our public offering completed on March 31, 2021.

Overall, ITS was a transitional acquisition for the company and its Transportation segment. The opening of our third U.S. brokerage office was a significant step forward in our expansion into the U.S. market. Titanium continues to demonstrate why we are one of Canada’s Fastest Growing Companies for 12 years in a row with our record quarterly revenue. Our unwavering disciplined approach to capital deployment and strong balance sheet uniquely positions us for future growth. As always, Titanium remained focus on delivering sustainable, profitable growth while creating long-term shareholder value.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

COVID-19 INFORMATION

Throughout the pandemic, Titanium’s utmost priority is to ensure the health and wellbeing of our people, our customers and the communities at large. Following the sudden onset of the COVID-19 pandemic, Titanium recognized the severity of the health and financial impact of this highly contagious virus. We have and will continue to monitor closely all pandemic related information to ensure we continue to take all necessary precautionary actions to uphold our uninterrupted services to our customers. Following our swift implementation of safety measures in Q1 2020, the following measures will remain in place until further notice:

• Provide our people with proper Personal Protective Equipment (“PPE”) suitable for their duties;

• Educating our workplace to adhere to new government pandemic protocols for the safety of our people and customers;

• Provide Work-From-Home capabilities to workforce as needed;

• Provide our workforce with up-to-date information regarding the preventative measures being taken by the Company and financial assistance available from the government relating to the pandemic.

We are pleased with the professionalism and tremendous efforts demonstrated by our people during these difficult times. Titanium can only operate without interruption due to the efforts by our valued team members.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

Selected Segmented Financial Information (unaudited)

Truck Transportation Revenue Fuel surcharge Operating expenses Carriers and independent contractors Vehicle operating Wages and casual labour Other operating EBITDA(1) EBITDA margin(1) Depreciation Amortization of customer lists Operating income (loss)(1) Operating margin(1) Gain on sale of property and equipment Finance costs Finance income Gain on Sales of Investments Transaction costs Income tax expense (recovery) Net income (loss)	3 months 3 months ended ended March 31 March 31 2021 2020
	35,409,508 25,397,606 3,771,038 2,214,184
	39,180,546 27,611,790 13,437,490 9,209,219 10,176,474 6,483,749 9,975,313 6,702,819 1,411,913 788,573
	35,001,190 23,184,360 4,179,356 4,427,430 % 11.8 % 17.4 4,683,716 2,999,762 114,293 57,150
	(618,653) 1,370,518 % (1.7) % 5.4 (71,850) (87,858) 770,039 739,091 (49,779) (137,754) (597,744) - 800,000 - (345,726) 264,531
	(1,123,593) 592,508

(1) Refer to "Non-IFRS Financial Measures".

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

Selected Segmented Financial Information (unaudited) , continued

Selected Segmented Financial Information(unaudited), continued
Logistics Revenue Fuel surcharge Operating expenses Carriers and independent contractors Wages and casual labour Other operating EBITDA/ Operating income(1) EBITDA/ Operating margin(1) Depreciation_(2) Finance costs(2)_ Income tax expense Net income	3 months 3 months ended ended March 31 March 31 2021 2020
	45,158,220 16,678,302 2,382,562 1,302,781
	47,540,782 17,981,083 40,005,667 15,415,558 2,871,732 1,587,842 674,309 422,907
	43,551,708 17,426,307 3,989,074 554,776 % 8.8 % 3.3 108,704 160,766 46,047 37,726 939,722 78,340
	2,894,601 277,944

(1) Refer to "Non-IFRS Financial Measures".

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

Revenue (unaudited)

Revenue(unaudited)
Truck Transportation Revenue Fuel surcharge	3 months 3 months ended ended March 31 March 31 2021 2020
	35,409,508 25,397,606 3,771,038 2,214,184
	39,180,546 27,611,790
Logistics Revenue Fuel surcharge	45,158,220 16,678,302 2,382,562 1,302,781
	47,540,782 17,981,083

For the three month period ended March 31, 2021, the Company's consolidated revenues increased by $41.4 million or 93.3%, when compared to the three month period ended March 31, 2020. The increase in revenue reflected significant growth in our U.S. logistics operations, which added $27.6 million compared to the same period in 2020, and acquired revenue from ITS, which totaled $12.0 million during the quarter. The average exchange rate used to convert our revenue generated in U.S. dollars fell this quarter to C$1.2666 from C$1.3442 during the same period in 2020, resulting in a negative exchange impact on the company’s revenue of $2.7 million.

The Truck Transportation segment experienced an increase in revenue of $11.6 million or 41.9%, for the three month period ended March 31, 2021 when compared to that of 2020. The increase is primarily a result of revenue contribution from business acquisition of $12.0 million, offset slightly by decrease in pricing and volume from pre-pandemic economic conditions in the same period last year.

The Logistics segment saw an increase in revenue of $29.6 million or 164.4% for the three month period ended March 31, 2021, when compared to the same period in 2020. The significant improvement in segmented revenue was primarily due to incremental revenue related to our U.S. freight brokerage expansion, which opened two offices in Nashville and Chicago, since the same period last year. U.S. logistics operations contributed $32.4 million for the three month period ended March 31, 2021.

Titanium Transportation Group Inc.

Management's Discussion and Analysis for the first quarter ended March 31, 2021

Operating Expenses and Income(unaudited) Truck Transportation Revenue Operating expenses EBITDA(1) EBITDA margin(1) Depreciation and amortization Operating (loss) income(1) Operating margin(1)		3 months 3 months ended ended March 31 March 31 2021 2020
		39,180,546 27,611,790 35,001,190 23,184,360
		4,179,356 4,427,430 % 11.8 % 17.4 4,798,009 3,056,912
		(618,653) 1,370,518 % (1.7) % 5.4
Logistics Revenue Operating expenses EBITDA/ Operating income(1) EBITDA/ Operating margin(1)		47,540,782 17,981,083 43,551,708 17,426,307
		3,989,074 554,776 % 8.8 % 3.3
Corporate Operating expenses		653,547 435,311

(1) Refer to "Non-IFRS Financial Measures".

For the Truck Transportation segment, operating expenses increased by $11.8 million or 51.0%, for the three month period ended March 31, 2021, compared to the same period in 2020. The increase in operating expenses was mainly a reflection of the increase in volume from the ITS acquisition. Operating margin also decreased by 7.1% when compared to the same periods last year. Margins are expected to soften following an acquisition as the segment integrates the operations and realizes synergies. We expect margins will normalize in the second half of 2021. Included in wages and casual labour expense was government assistance of $0.3 million from the CEWS program. Adjusted for government assistance received in the quarter, adjusted operating loss for the segment was $0.9 million, a decrease of $2.3 million from the same period in 2020. Adjusted operating margin decreased to -2.3%, a 7.7% point decrease in adjusted operating margin for the three month period ended March 31, 2021 from the same period in 2020.

For the Logistics segment, operating expenses increased by $26.1 million or 149.9% for the three month period ended March 31, 2021. The increase in operating expenses is mainly due to the significant growth in the U.S. freight brokerage operations, as well as steady growth in the Canadian operations. Operating income and operating margins improved to $4.0 million from $0.6 million, and 8.8% from 3.3%, respectively, when compared to the three months ended March 31, 2020. The improvements in operating margin was largely attributable to an increase in volume and revenue over a relative fixed cost, as well as favorable U.S. environment as the economy recovers from the pandemic.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

SUMMARY OF QUARTERLY RESULTS

The following table sets out quarterly financial information for the Company's eight most recently completed quarters:

quarters:
Revenue EBITDA(1) EBITDA margin(1) Operating income(1) Operating margin(1) Net income and comprehensive income attributable to the owners the Company Per share - basic Per share - diluted	(in thousands) Q1'21 Q4'20 Q3'20 Q2'20 Q1'20 Q4'19 Q3'19 Q2'19
	85,675 65,850 52,627 37,952 44,312 43,287 42,708 42,041 7,515 6,529 6,713 5,305 4,547 4,467 435 4,868 % 9.5 % 10.4 % 13.5 % 14.7 % 11.1 % 11.2 % 11.4 % 12.4 2,608 2,968 3,646 1,819 1,329 1,175 1,025 1,442 % 3.3 % 4.7 % 7.3 % 5.1 % 3.3 % 2.9 % 2.6 % 3.7 of 1,169 2,094 2,655 874 643 273 313 455 0.03 0.06 0.07 0.02 0.02 0.01 0.01 0.01 0.03 0.06 0.07 0.02 0.02 0.01 0.01 0.01

(1) Refer to "Non-IFRS Financial Measures".

Changes from quarter to quarter are mainly the result of seasonality of operations, changes in industry conditions and acquisitions. In January 2020, COVID-19 became widely known as the spread of the virus began to affect countries outside China. As the virus continued to spread, the outbreak was declared a global pandemic on March 11, 2020 by the World Health Organization. In response, many countries, including the United States and Canada, imposed government-mandated shutdowns of non-essential businesses and travel restrictions. Overall macroeconomic conditions deteriorated sharply as a result of these regulations and caused significant pressure in pricing and demand. The Canadian government also implemented various relief programs, such as the CEWS program, to alleviate the economic effects of the pandemic.

Market conditions began to improve at the end of Q2 2020. Freight demand improved for the second half of 2020 as many end markets served by Titanium resumed activities. The economic recovery was particularly strong in the United States, in part reflecting the accelerated roll-out of COVID-19 vaccinations. In contrast, the Canadian market lagged far behind in the recovery process due to ongoing government-mandated closures and measures.

In addition, there has historically been an increase in revenue and a decrease in margins in quarters following an acquisition. Revenues have often decreased, stabilized and then increased while EBITDA margins have increased in quarters after a business acquisition.

Titanium Transportation Group Inc.

Management's Discussion and Analysis for the first quarter ended March 31, 2021

LIQUIDITY AND CAPITAL RESOURCES

Working capital(1) Total assets Net debt(2) Shareholders' equity Net debt to equity ratio(3)	March 31 December 31 2021 2020
	1,080,028 8,636,848 218,590,486 138,764,411 72,722,249 53,610,424 71,908,572 47,071,445 1.01 1.14

(1) Working capital (deficit) is defined as current assets less current liabilities.

(2) Net debt is defined as bank indebtedness, loans payable and finance lease liabilities, net of cash, finance lease receivables and assets held for sale, both current and long-term portions.

(3) Net debt to equity ratio is defined as net debt divided by shareholders' equity.

The Company's working capital position improved as at March 31, 2021 when compared to December 31, 2020. We continued our successful capital management strategy and further enhanced the Company's net debt to equity position on top of significant improvements in 2020. The improvement this quarter is due to capital raised from our public offering completed on March 31, 2021, as well as increases in cash flow generated from profitable operations, offset by debt incurred and assumed from the acquisition of ITS. The considerations for the transaction consisted of $27.0 million in cash and $33.5 million in assumed debt and vendor takeback loan. On a quarter-over-quarter basis, net debt to equity ratio further decreased from 1.14 in Q4 2020 to 1.01 in Q1 2021.

In terms of rolling stock expenditure, we have committed $12.8 million towards the purchase of 70 new power units over the next three quarters. Of this amount, $2.8 million will be allocated towards 15 new power units to expand our current fleet. As a result of the ITS acquisition, we also expect to purchase an additional 100 van trailers to replace aged equipment in the next three quarters. In addition, we expect to realize proceeds from the sale of excess aged equipment of approximately $2.0 million. Our rolling stock replacement policy is to replace trucks after 6 years, van trailers after 10 years and flatbed trailers after 15 years. We believe there is sufficient financing available to fund planned capital expenditures in the future and to provide for the further organic and inorganic growth of the business.

The following table sets out the Company's contractual obligations, excluding future interest payments:

(in thousands) Loans Finance leases	After Total 1 Year 2 Years 3 Years 4 Years 5 Years 5 Years
	23,639 7,333 5,904 4,322 3,026 1,515 1,539 62,518 11,796 8,158 6,008 3,888 32,446 222
	86,157 19,129 14,062 10,330 6,914 33,961 1,761

Titanium actively seeks debt refinancing when possible, especially with respect to debt acquired through business acquisitions, to the extent that penalties for early retirement of debt are not significant and lower cost financing is available. We believe the Company's operating cash flows are sufficient to fund daily operating activities and meet regular debt repayment obligations.

Management's Discussion and Analysis for the first quarter ended March 31, 2021

Titanium Transportation Group Inc.

The portion of the Company's bank credit facilities which were unused as of March 31, 2021 include approximately $23.0 million under the revolving demand operating facility, $10.0 million under an accordion acquisition facility and $5.5 million under a finance lease loan facility. In addition, the Company has $17.6 million available in finance leasing and loan facilities through other institutions.

The Company's credit facility and finance leasing agreements require Titanium to maintain three covenants on a quarterly basis. These covenants are measured on a consolidated rolling twelve-month basis. We were in compliance with all covenants as of March 31, 2021 and we believe the Company will be in compliance with all required covenants for the next twelve months. The first covenant requires the Company's debt to tangible net worth ratio to be less than 3.5. Debt to tangible net worth is a ratio of total liabilities plus future minimum lease payments on non-realty operating leases to shareholder's equity less goodwill, customer lists and deferred tax assets. The second covenant requires the Company's debt service coverage ratio to be greater than 1.15. Debt service coverage is a ratio of net income before interest income and expenses, gains on sale of equipment, depreciation, amortization and non-cash items, less unfinanced capital expenditures, plus proceeds of sale of equipment, to contractually required principal and interest payments made over the prior twelve months. The third covenant requires the Company's fixed charge coverage ratio to be greater than 1.00. Fixed charge coverage is a ratio of net income before interest income and expenses, gains on sale of equipment, to contractually required principal and interest payments made over the prior twelve months.

The Company must calculate its covenants by adjusting its net income and debt to treat realty leases as an operating lease rather than a finance lease.

Common Shares

The Company offers a share purchase plan (the "Plan"), which allows all employees and independent contractors, but excluding insiders of the Company, to contribute up to 5% of their compensation to a maximum of $4,800 per year towards the purchase of Titanium common shares. Contributions are matched at a rate of 100% by the Company and shares are issued from treasury in order to fund the Plan. In the case of employees, matched shares are subject to a three year vesting period. In the case of independent contractors, matched shares are issued after three years of service. The maximum number of shares approved for issuance under the Plan is reviewed by the board of directors annually. Of the shares issued to date, 497,615 have not yet vested.

On May 17, 2019, we established a normal course issuer bid to purchase up to 1,839,267 of the Company's common shares (the "NCIB"), representing 5% of its issued and outstanding common shares. The NCIB will terminate on May 16, 2020, or on an earlier date in the event that the maximum number of common shares sought in the NCIB have been repurchased. Purchases pursuant to the NCIB are expected to be made through the facilities of the TSX Venture Exchange (the "TSXV"), or such other permitted means, including through alternative trading systems in Canada, at prevailing market prices or as otherwise permitted by the policies of the TSXV. During the quarter, we did not repurchase any shares.

As of May 11, 2021, there are 43,784,210 common shares of the Company outstanding. In addition, there are 2,119,100 stock options outstanding, of which 905,598 are exercisable.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

TRANSACTIONS WITH RELATED PARTIES

The Company provides truck transportation services to companies under common control. These companies include Vision Extrusions Group Limited, Vision Profile Extrusions Ltd. and Sunview Patio Doors Ltd. Aggregate revenues from these companies totaled $2,874,779 for the three month period ended March 31, 2021 (2020 - $2,078,629).

The Company also currently leases its head office from Caledon First Investments Limited, a company under common control. Total payments made to this company for the three month period ended March 31, 2021 was $464,031 (2020 - $448,047). The Company has committed to annual base rent of $1,863,369, which will increase to $2,413,123 over a 12 year period.

Trunkeast Investments Canada Limited, the Company's controlling shareholder as of March 31, 2021, provides administrative and support services to the Company on a monthly basis. For these services, the Company was charged $7,500 (2020 - $7,500) for the three month period ended March 31, 2021.

These transactions were carried out in the normal course of business and were measured at the exchange amount, which management has concluded approximates an arm's-length arrangement.

FORWARD LOOKING STATEMENTS

This MD&A contains forward looking statements that reflect the Company's current expectations and projections about its future results. When used in this MD&A, forward looking statements can be identified by the use of words such as "may", or by such words as "will", "intend", "believe", "estimate", "consider", "expect", "anticipate", "objective" and similar expressions or variations of such words. Forward looking statements are, by their nature, not guarantees of the Company's future operational or financial performance and are subject to risks and uncertainties and other factors that could cause the Company's actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward looking statements. No representation or warranty is intended with respect to anticipated future results or that estimates or projections will be sustained.

Readers are cautioned not to place undue reliance on these forward looking statements, which are necessarily based on a number of estimates and assumptions that, while considered reasonable by management as of the date of this MD&A, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The following factors could cause the Company's actual financial performance to differ materially from that expressed in any forward looking statement: highly competitive market conditions, the Company's ability to recruit, train and retain qualified drivers, the Company's ability to identify, successfully complete and integrate suitable acquisitions, fuel price variation and the Company's ability to recover these costs from its customers, foreign currency fluctuations, the impact of environmental standards and regulations, changes in Canadian and US government regulations applicable to the Company's operations, changes in key personnel, adverse weather conditions, accidents and litigation, the market for used equipment, changes in interest rates, changes in the cost of liability insurance coverage, downturns in general economic conditions affecting the Company and its customers and availability of financing on reasonable commercial terms. The Company expressly disclaims any obligation to update forward looking statements if circumstances or management's views or estimates change, except as otherwise required pursuant to applicable law.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

From time to time, we will disclose our current annual run rate revenue and EBITDA. Although not intended as such, this may be interpreted as forward looking information. Run rates are presented in order to provide investors with insight into the current size of the Company and do not take into account expected future growth or changes in economic conditions. Historical figures may not be a good indicator of the Company's size, due to acquisitions and the time that it takes to fully realize synergies. After our acquisition of ITS, we estimated that post synergy annualized revenue and EBITDA would be $330 million and $33 million, respectively.

NON-IFRS FINANCIAL MEASURES

This MD&A includes the following financial measures that do not have any standardized meaning under IFRS and may not be comparable to similar measures employed by other companies:

"Earnings before interest, income taxes, depreciation and amortization" ("EBITDA") is calculated as net income before depreciation, amortization, asset impairments, gains or losses on the sale of equipment, finance income and costs, gains or losses on foreign exchange, income tax expense, transaction costs, accelerated customer list amortization and goodwill impairment.

"EBITDA margin" is calculated as EBITDA as a percentage of revenue before fuel surcharge.

"Operating income" is calculated as net income before asset impairments, gains or losses on the sale of equipment, finance income and costs, gains or losses on foreign exchange, income tax expense, transaction costs, accelerated customer list amortization and goodwill impairment.

"Operating margin" is calculated as operating earnings as a percentage of revenue before fuel surcharge.

"Adjusted net income" is calculated as net income before items that are not in the normal course of business, such as accelerated customer list amortization and goodwill impairment.

Management of the Company believes that these financial measures are useful for investors and other readers, when used in conjunction with other IFRS financial measures, as they are measurers used internally by management to evaluate performance. However, these financial measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of financial performance prepared in accordance with IFRS.

Titanium Transportation Group Inc. Management's Discussion and Analysis for the first quarter ended March 31, 2021

RISKS AND UNCERTAINTIES

The Company's business is subject to a number of risk factors which are described in our most recently filed annual information form. Additional risks and uncertainties not presently known to us or that we currently consider immaterial also may impair our business and operations and cause the price of the common shares to decline. If any of the noted risks actually occur, our business may be harmed and the financial condition and results of operations may suffer significantly. In that event, the trading price of the common shares could decline, and shareholders may lose all or part of their investment.

As the duration and impact of the COVID-19 pandemic to the global economy is indeterminable, it is not possible to reliably estimate the length and severity of COVID-19 related impacts on the financial results and operations of the Company. The Company will continue to closely monitor the situation as it develops day-today and will take further actions, if necessary, to ensure the wellbeing of our workforce, customers, suppliers and other stakeholders, as well as minimize the disruption to Titanium's services.

The Company has taken measures to mitigate the potential negative impact on its financial results as a result of the outbreak. These measures are described under the section COVID-19 information in this MD&A. As the current market remain uncertain, the Company's exposure to interest rate risk and foreign exchange risk are heightened due to the volatility of the market. We continue to monitor the economic conditions on a daily basis to mitigate these risks.

The Company does not expect any material changes to other risk factors provided that temporary COVID-19 precautionary measures relax in the near future. If these measures extend indefinitely, there may be adverse effects on Titanium's credit risks as customers may become financially distressed. There may also be additional risks to the Company's operations as available workforce may contract for the Company, its customers and its suppliers. Furthermore, a prolonged period of precautionary measures will likely have severe effects on the Company's liquidity position. All of the above will have adverse impact to the Company's financial performance if the precautionary measures remain indefinite.

CHANGES IN ACCOUNTING POLICIES

The following new standards and amendments to standards are not yet effective for the year ended March 31, 2021 and have not been applied in preparing the consolidated interim financial statements:

IAS 1, Presentation of Financial Statements IAS 37, Provisions , Contingent Liabilities and Contingent Assets