Cargojet Inc. announced its financial results for the second quarter ended June 30, 2022. Total Revenues for the quarter were $246.6 million compared to the second quarter 2021 Revenues of $172.1 million. Gross Margin for the quarter was $61.1 million compared to the second quarter 2021 Gross Margin of $54.9 million.
Adjusted EBITDA for the quarter was $81.1 million compared to the second quarter of 2021 Adjusted EBITDA $67.4 million. Net income for the quarter was $160.9 million (net income of $26.2 million excluding warrant valuation gain) compared to a net loss of $11.1 million in 2021 (net income of $23.6 million excluding warrant valuation loss).
Total revenue growth of 43.3% (31.9% excluding fuel surcharges) for the quarter compared to the prior year reflected a strong contribution from the Domestic network, up 15.0%, ACMI, up 62.4%, and All-in Charters, up 23.2% compared to the same quarter last year.
Continuing its strategic focus on diversification, Cargojet’s Domestic Network Revenue for the quarter now stands at 35.2% of total revenues compared to 43.8% for the same period in 2021.
Adjusted Free Cash Flow(1) was $44.8 million for the three-month period ended June 30, 2022, compared to $36.0 million for the same period in 2021.
On July 22, 2022, Cargojet established a non-revolving USD $400 million Delayed-Draw Term Loan facility for general corporate purposes including the purchase of aircraft and other capital expenditures. Together with the existing undrawn revolver, this brings Cargojet’s total liquidity to appx. $1 billion.
Macro uncertainties continue to impact air-cargo supply chains with passenger airlines facing extremely difficult operating conditions. The impact of rapidly shifting schedules and poor on-time performance of passenger airlines has further restricted the ability of cargo shippers to utilize belly space.
This, combined with ongoing supply chain challenges, continues to provide opportunities for Cargojet to capture unmet demand in the medium term.
Furthermore, despite short-term volatility, the secular shift to e-commerce continues to hold steady with demographics-led long-term trends continuing to present Cargojet with long-term growth opportunities.
“Unpredictability of belly space was the reason Cargojet was born over 20 years ago,” said Dr. Ajay Virmani, President, and CEO. “From the first day of our existence, we have focused on doing just one thing – flying cargo. That’s our sole purpose and mission. “We have built a brand that is trusted by our customers to keep its promises and the recent macro events have further strengthened our resolve to stay focused on serving our customers. “Yet, we are not immune to the global forces of high inflation, high fuel prices, and geopolitical uncertainties. “Therefore, we remain prudent in how we are approaching the next few quarters as we continue to balance investing in growth with maintaining a strong balance sheet,” concluded Dr. Virmani.
