CARGOJET GOING PUBLIC?

aero-singidunum · Post by **aero-singidunum** » Fri May 13, 2005 6:06 am

Just talk to body of mine, Cargojet told their employees that they are going public. Something like getting money for next step.
(they claim profit of 14 mil laast year).

Are they going wide bodies soon, Asia or Europe?

Anybody knows anything about?

imc · Post by **imc** » Fri May 13, 2005 9:08 am

True indeed.

http://www.sedar.com

Looks like Asia first, talking 747-400 or MD-11. Both aircraft are scarce however, and it looks as though they are prepared to wait it out for the right deal.

teacher · Post by **teacher** » Fri May 13, 2005 10:15 am

Picking up the pieces at ACE maybe?

Cargodog · Post by **Cargodog** » Fri May 13, 2005 10:25 am

I've been waiting for two weeks to see this discussion start. Surprised it took so long.

It's an Income Trust Fund with the Ownership group retaining 25% (mostly over the three current owners).

Yes, items such as Asia have been explored (as has been previously discussed here). There are a number of possibilities including a need for eventual replacement of the current 727 fleet.

Should be listed and traded on the TSE by early June.

Definitely an exciting time for us at Cargojet.

Cargodog

Kosiw · Post by **Kosiw** » Fri May 13, 2005 10:32 am

This may sound like a strange question, but is a 14 million dollar profit at Cargojet considered good? I know any profit is better than a loss, just wondering what is considered a healthy profit in the cargo flying industry??

With planned expansion will Cargojet do more hiring and open up any bases out west??

imc · Post by **imc** » Fri May 13, 2005 10:44 am

14 million profit on revenue of 101 million is considered decent for any sector of business. It is not earth shattering, but it shows a solid base and is pretty impressive considering the cost of fuel and running 12 727's.

As for hiring, who knows at this point. If we move to a fleet of 2 crew aircraft then even with major expansion it could mean no additional hiring realistically. That being said, I am sure it will be years before you see the 727 completely out of the picture.

YVR base has been talked about, but who knows what goes on behind closed doors.

As for picking up the pieces at ACE, I don't really know about that either. From what I hear Cubana doesn't pay well, so I think they would only be interested in Bax and Bermuda. That would take the wheels falling off completely over there, which I suppose isn't out of the question...

I agree with Cargodawg, exciting times for all of us!

Cargodog · Post by **Cargodog** » Fri May 13, 2005 10:50 am

14M profit on 100M revenue is fantasic!

Most companies can HOPE for 4-5% yield. 14% is exceptional. IMHO of course..

To put things relative:

Southwest Profit Margin 5.4%
Southwest 5 year Average Profit Margin 7.3%
JetBlue 2.9%
Industry Average 2.2%

UPS 9.2%
FedEx 4.9%
Industry 5.4%

I'd say 14% is a pretty incredible number given the commodity..

bizjet_mania · Post by **bizjet_mania** » Fri May 13, 2005 4:38 pm

Good for them, its nice to here some good news for a change. Would love to see an MD11 in Cargojet colours.

yycflyguy · Post by **yycflyguy** » Fri May 13, 2005 11:03 pm

imc wrote:True indeed.

http://www.sedar.com

Looks like Asia first, talking 747-400 or MD-11. Both aircraft are scarce however, and it looks as though they are prepared to wait it out for the right deal.

I thought several 747-400's were sitting in the southwest desert? Are they really that hard to come by these days?

fmrc3ame · Post by **fmrc3ame** » Sat May 14, 2005 9:11 am

Cool link http://www.cardatabase.net/modifiedairl ... d=00001855

imc · Post by **imc** » Sat May 14, 2005 1:02 pm

The problem is price.

Cargojet has done very well because their acquisition costs of the 727 fleet was amazing.

Who knows what the future holds, but they are not going to jump at the first opportunity without it being fiscially viable.

Like I said earlier, it may take a while...

Cargodog · Post by **Cargodog** » Sat May 14, 2005 1:07 pm

Ya, that modded photo has been floating on there for a bit. Also saw a 747 painted up in CJ colours a while ago.

The key to finding the right aircraft is one that will fit into the domestic program and then be suitable for a trans oceanic operation so that the fixed costs are spread over lots of hours. The 747-400 may be a bit of overkill to work into the domestic system, but who knows.

Either way, the IPO will allow for grow of the company beyond just a domestic program and facilitate the eventual 27 phase-out.

Like IMC said, no rush. If it's the right mix and the right opportunity then the ownership group will make it happen.

hypoxic · Post by **hypoxic** » Sun May 15, 2005 5:36 am

No photochop here!
http://www.visitingphx.com/ace.html

Cargodog · Post by **Cargodog** » Sun May 15, 2005 11:34 am

Nope it's down there. But a DC10 is not the aircraft to do Asia (one of the rumours) and wont likely work in Canada (think intra Europe discussed).

Either way, wish ACE best of luck.

Flywest · Post by **Flywest** » Sun May 15, 2005 1:23 pm

Looks Great,

Too bad everyone at ACE with a DC-10 endorsement was fired on Tuesday.

aero-singidunum · Post by **aero-singidunum** » Mon May 16, 2005 7:41 am

Cool, i was in impression that B757-200 will be used for domestic
(hanger was built for that plane) and another was going around as B767 cargo. Well whatever owners decide will be the right thing.
Employees are just offer to buy shares

aero-singidunum · Post by **aero-singidunum** » Mon May 16, 2005 8:06 am

Cargodog wrote:
"Definitely an exciting time for us at Cargojet."

Are U flying or wrenching at CJA?

Cargodog · Post by **Cargodog** » Mon May 16, 2005 9:44 am

Aero, in response to your question - neither.

Yes, the 57 has been discussed and yes the YHM hangar will accomodate a 57.

The 57 will likely continue to be explored, as will other AC types (67/MD11/47/etc). The perfect marriage would be an aircraft that services the both the domestic program and the international program to maximize utilization of the asset. The 27 will likely be required for lessor demand routes (eg east coast).

The 57 would be good for domestic ops and provides some more positions above the 27, but doesnt work if trans oceanic operations are in the cards. May still come around as there are enough out there and available, and it also allows for the current container inventories to be used (versus wide bodies). Could do domestic ops and maybe transborder somewhere down the road. Who knows.

At this point there are lots of possibilities and hours could be spent speculating on what may happen. Time will tell which one comes to fruition. Either way the IPO will facilitate the means for the current ownership group to take the company to the next level.

aero-singidunum · Post by **aero-singidunum** » Mon May 16, 2005 11:18 am

So, is that mean that employees will get to buy and company will match some procent, or as RRSP. what is the way that Cargojet will aproach employees to contribute, if company does not match?
I remember last year that friend of mine was talking about company pension (and that never started, so are they using WestJet way (best way so far to get employees involved) or some new way?

Cargodog · Post by **Cargodog** » Mon May 16, 2005 11:42 am

Not sure what you're trying to say.

The company has simply given an offer to employees to by units in the Trust Fund at the initial IPO price versus purchasing them on the open market and being possibly negatively impacted by the bump.

There's not discussion of the company matching stock purchases etc, simply a nice offer.

What is your first language?

Either way it's a good opportunity for CJT employees to be a part of it.

aero-singidunum · Post by **aero-singidunum** » Mon May 16, 2005 11:58 am

German , Cdog

aero-singidunum · Post by **aero-singidunum** » Mon May 16, 2005 12:24 pm

And what i want to say is that CJA claim 14 mil profit, would be nice that they offer to employees will match 10% of your purchase, or will get you shares at discount.
What is a difference Cargodog buying at $10 from cargojet or brom some broker that you know.
My point was simple (on german) Company made that profit thanks to You and others who work their butt off in order to make company where is now. How about company get something back, does not have to be big
bucks, like a $1000 to all?

I do notr thing that you will mind that ?

ratsirt · Post by **ratsirt** » Mon May 16, 2005 1:24 pm

14 mil profit, are they sure as the rumour I had heard was not even close to that.

Glad though to see they may be on there way into other markets.

Cargodog · Post by **Cargodog** » Mon May 16, 2005 1:28 pm

To do an IPO it's not like there arent bank audits confirming numbers.

But then from what I remember from the old AEForum you were never much of a CJT fan. I remember summer 2002 fairly well.

ratsirt · Post by **ratsirt** » Mon May 16, 2005 2:00 pm

I have nothing against Cargojet, I really do wish them the best.

Are these numbers incorrect?

December 31

Financials : Revenue for the 12 months ended March 31, 2005 - $106,034,000
Net income for the 12 months ended March 31, 2005 - $2,665,000

Revenue for the year ended December 31, 2004 - $9,596,000
Net income for the year ended December 31, 2004 - $3,915,000