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Cargojet set on cutting costs as Q2 revenue fall 15pc
来源：shippingazette 编辑：编辑部 发布：2023/08/21 17:13:10
CANADA-BASED freighter operator Cargojet will focus on cost reduction initiatives as a slowdown in e-commerce and business-to-business demand hit its financial performance, reports London's Air Cargo News.
The airline saw second-quarter revenues decline by 15 per cent year on year to CAD209.7 million (US$156 million), due primarily to decreases in domestic network revenues, all-in charter revenues, fuel surcharges and other pass-through revenues. Aircraft, crew, maintenance and insurance (ACMI) revenues however increased by CAD2.7 million.
The revenue fall in its domestic and all-charter was due to a decrease in e-commerce and B2B volumes during the period, partially offset by contractual customers' consumer price index increases.
Net income dropped 80.7 per cent to CAD31.1 million but the company pointed out this was largely down to the change in the fair value adjustment of stock warrants, as well as the domestic and all-in performance.
Cargojet president and chief executive Ajay Virmani said: "To prepare Cargojet to ride the current economic cycle, we shifted our focus to cost management as well as right-sizing our network, while curtailing growth CapEx and focusing on generating free cash flow.
"While we expect economic conditions to remain difficult, the shift in consumer spending towards travel and leisure vs goods is expected to normalize towards the end of this year."
Earlier this year the company announced it would reduce its freighter conversion plans to four B777s from a previous plan for eight of the aircraft, although it would maintain the slots.
The airline saw second-quarter revenues decline by 15 per cent year on year to CAD209.7 million (US$156 million), due primarily to decreases in domestic network revenues, all-in charter revenues, fuel surcharges and other pass-through revenues. Aircraft, crew, maintenance and insurance (ACMI) revenues however increased by CAD2.7 million.
The revenue fall in its domestic and all-charter was due to a decrease in e-commerce and B2B volumes during the period, partially offset by contractual customers' consumer price index increases.
Net income dropped 80.7 per cent to CAD31.1 million but the company pointed out this was largely down to the change in the fair value adjustment of stock warrants, as well as the domestic and all-in performance.
Cargojet president and chief executive Ajay Virmani said: "To prepare Cargojet to ride the current economic cycle, we shifted our focus to cost management as well as right-sizing our network, while curtailing growth CapEx and focusing on generating free cash flow.
"While we expect economic conditions to remain difficult, the shift in consumer spending towards travel and leisure vs goods is expected to normalize towards the end of this year."
Earlier this year the company announced it would reduce its freighter conversion plans to four B777s from a previous plan for eight of the aircraft, although it would maintain the slots.