Air cargo operator Cargojet is slimming down its fleet as it struggles to deal with a massive downturn in business despite recently giving shareholders a 10% increase in dividends.
The Canadian carrier is cutting capacity and trying to preserve its strong cash flows by offering at least four of its converted Boeing 757 aircraft up for sale according to the airline's Chief Financial Officer Scott Calver during a third-quarter results call.
The planes will continue to be available for other companies to lease until they are sold the airline confirmed. Earlier this year Cargojet sold one Boeing 777-300 aircraft
for $36 million resulting in a loss on sale of $3.6 million. Two Boeing 777-300 hulls suffered significant damage due to severe hailstorms, the airline assessed the damage cost $13.8 million, for which the insurers paid $12.2 million. Cargojet has also paused all planned conversions on 767s and 777s.
After launching Cargojet 22 years ago as Founder and Chief Executive Officer, Dr. Ajay Virmani will be stepping into the role of Executive Chairman effective January 1, 2024 and the Corporation has announced leadership appointments in a separate announcement. This strategic move reflects Dr. Virmani’s dedication to the company’s long-term success and the need to ensure a seamless transition in the leadership.
Dr. Ajay Virmani, who has served as the CEO since its inception in 2001, along with the team he built, has been instrumental in Cargojet’s remarkable journey from a start-up to Canada’s #1 cargo airline. Just last week Dr. Virmani was appointed to the Order of Ontario. The Globe and Mail honored Dr. Virmani as the CEO-Strategist of the year in 2020. In 2004, Dr. Virmani was awarded the “Entrepreneur of the Year award” by Ernst &Younge. Recognizing his entrepreneurial and philanthropic contribution to Canada, he was inducted into Canada’s Walk of Fame with his own star in 2021. Cargojet and its leadership has also been recognized as the 50 Best Managed Companies by Deloitte’s and has been a consistent winner of Canada’s Best Cargo Airline award 21 years running.