Cargojet business soars as e-commerce takes off

MISSISSAUGA, Ont. — Cargojet Inc. shares surged to a record high after it reported that revenues soared 65 per cent as e-commerce activity was driven by work-from-home activity during the COVID-19 lockdowns.

Its shares gained 15.3 per cent or $25.45 to $191.83 in late morning trading on the Toronto Stock Exchange.

Revenues soared to $196.1 million from $119.1 million in the second quarter of 2019 as large online retailers and thousands of small- and medium-sized businesses moved their sales to online channels.

Statistics Canada said April e-commerce sales as a percentage of total retail sales doubled to 14 per cent compared with the first quarter and were up 120 per cent in May compared with the prior year’s quarter.

The Ontario-based company, which provides time sensitive overnight air cargo services, says it lost $45.1 million or $2.89 per share, compared with net earnings of 32 cents per share or $4.3 million a year earlier.

Cargojet was expected to earn 49 cents per share on $127.6 million of revenues, according to financial markets data firm Refinitiv.

Cargojet carries more than over 3.6 million kilograms of cargo weekly on its fleet of 26 aircraft.

“Reduced global air cargo capacity, as a result of extremely reduced passenger flights, led to strong … growth in international markets that we believe will continue for the short and medium term,” said CEO Ajay Virmani.

“We also realized strong ad-hoc international charter revenues operating during the period, providing capacity to bring PPE and other medical supplies back from Asia for various government agencies that may not be recurring.”