Cargojet cashes in on e-commerce boom and returns to the black in Q1
CANADA-BASED aircraft owner and operator Cargojet has benefitted from the continuing boom e-commerce demand that has resulted in an increase in the company's revenues and profits in the first quarter of the year
06 May 2021 - 19:00
Cargoject reported that first-quarter revenues increased by 30.3 per cent year on year to CAD160.3 million (US$130.58 million). Earnings before interest and tax were up from a CAD0.9 million loss last year to a CAD91.1 million profit this year while net earnings for the period increased from a loss of CAD1.8 million last year to a profit of CAD89.4 million, reports London's Air Cargo News.
The company said the increase in revenues was largely down to improvements in its domestic network and ACMI business.
'The increase [in domestic network revenues] was primarily due to an increase in e-commerce volumes during the period, but partially offset by a decrease in B2B volumes, both as a result of the Covid-19 pandemic,' it said.
'The e-commerce volumes continued to be significantly higher than previous years while the B2B volumes have largely recovered since the onset of the pandemic. The increase in shipping volumes during the period resulted in a 15.5 per cent increase in the average domestic network revenue per operating day.'
The ACMI increase came primarily as a result of two new scheduled routes to Europe that started in April 2020 to replace passenger belly cargo capacity that disappeared as a result of passenger airlines cutting back capacity and flying. Another route to the US and Mexico was added at the end of September 2020.
Over the past few months, the company has announced expansion plans. In February, Cargojet confirmed plans to enter the B777 freighter market and add extra B767F aircraft to meet international growth opportunities.
That month the lessor and operator also raised CAD365 million through an equity deal. The money will be used to pay off debt and acquire the new aircraft.
The company said that two Boeing 777 freighters will arrive in 2023, with the option to add two more in 2024.
The first two of these freighters will be deployed for long-haul Asian routes and emerging South Asian markets 'strategically integrated with Cargojet's domestic network and in addition, they will serve and connect seamlessly with select European and South-Central and North American cities'.
Meanwhile, the first of five Boeing 767 freighters, announced earlier, will begin arriving in 2021 with the first freighter arriving in the third quarter of this year with one additional freighter arriving every quarter thereafter.
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