* Q1 adj EPS C$0.12 vs est C$0.09
* Q1 profit C$14.9 mln vs C$26.1 mln yr ago
* Q1 rev up 20 pct at C$561.3 mln vs est C$533.8 mln
* Ups quarterly dividend by 15 pct to C$0.115/shr
* Shares up 4 pct (Adds details on pricing, acquisitions, debt)
May 17 (Reuters) - Canadian trucker TransForce Inc expects higher freight shipping rates to boost profits this year while it continues to focus on expanding the higher-margin package and courier operations.
"While volumes may remain stable, a better pricing environment should continue to lead to increased profitability," the company said in a statement on its website.
TransForce, which bought DHL Express' Canadian assets in April to boost its courier operations, plans to focus on debt reduction in the short term, as it continues to scout for acquisitions.
Loans and borrowings at the end of March 31 was C$822.7 million, according to company data.
The trucker has been steadily investing in the courier and package delivery space to cushion the impact of uncertainty in recession-battered businesses like freight and small cargo shipping.
"Immediate growth focus will continue to be centered on the package and courier and specialized services segments, where business opportunities are at present most appealing for TransForce," the company said on its website.
It also expects rising fuel costs to slightly hurt due to the lag before the increase is transferred to customers.
Raging fuel prices have hurt truckers across the board, including Contrans Inc and U.S. peers Arkansas Best and UTi Worldwide Inc , despite improving demand for freight shipping.
First-quarter revenue rose 20 percent, as its Dynamex purchase in February, and last year's acquisition of Speedy Heavy Hauling assets, contributed a combined revenue of about $70 million in the first quarter.
While less-than-truckload revenue before fuel surcharge fell 6 percent to C$105.4 million, courier revenue rose 64 percent to C$135.6 million.
January-March adjusted profit was 12 Canadian cents a share, above analysts' estimates of 9 Canadian cents, according to Thomson Reuters I/B/E/S.
Shares of the Montreal, Quebec-based company were trading up at C$15.34 after rising to a high of C$15.61 on Tuesday on the Toronto Stock Exchange. (Reporting by Gowri Jayakumar in Bangalore; Editing by Sriraj Kalluvila)