Freighter operator Cargojet saw both its revenues and profits grow in the second quarter of the year as higher fuel prices, contractual price increases and new charter opportunities affected performance.
The company saw second-quarter revenues increase 15.8% year on year to C$275.8M, adjusted ebitda was up 8.9% to C$87.3m and net earnings reached C$7m compared with a C$3.2m loss a year earlier.
The increase in revenues was driven by a 45.9% increase in fuel costs year on year, which are passed through to customers through a fuel charge mechanism, albeit with a small time lag.
Looking at divisional performance, the second-quarter revenue improvement was led by its all-in charter business, which registered an increase of 37.4% on last year to C$57.4m.
“The increase in [charter] revenue was primarily due to new charter opportunities, partially offset by the reductions in year-over-year frequency of scheduled charter services between China and Canada,” the company said.
It also supported a customer, which previously operated MD-11F aircraft, which were last year temporarily grounded following the fatal UPS accident.
Domestic network revenues for the period, meanwhile, increased by 8.1% on last year to C$110.6m as a result of consumer price index increases for contractual customers and higher fuel prices.
Meanwhile, ACMI revenues for the quarter fell 12.6% against last year to $54.6m, a decrease primarily driven by redeployment of aircraft from long-distance routes of Asia and Europe to certain South American routes.
“Our strong second quarter results reflect the resilience of our business model, the strength of our longterm customer partnerships, and our team’s disciplined execution”, said Pauline Dhillon, chief executive.
“Our One Fleet strategy continues to differentiate Cargojet by enabling us to dynamically deploy our assets to the highest-return opportunities while improving fleet and flight-level asset utilisation.
“Combined with our focus on revenue quality, disciplined cost management and operational excellence, we delivered another strong quarter while maintaining our industry-leading 99.2% on-time performance.”
The company also benefited from a new service from Liège to Tel Aviv, following the launch of operations to Liege last year.
Meanwhile, the airline also confirmed it had reached an agreement with the Air Line Pilots Association (ALPA) on a new deal.
Pilots will get a wage increase of 26%, followed by annual increases of 5% over each of the subsequent four years through June 30, 2031.
Meanwhile, pilots will move from a baseline of 15 working days per month to 16 and the deal continues to inclued a no-strike, no-lockout provision.
