Slides
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June 2025
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1 Cautionary StatementGeneralThis presentation is property of Cargojet Inc. (“Cargojet”, “CJT” or the “Company”).This presentation does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Company. This presentation does not purport to contain all information relevant to aninvestment decision in respect of the Company and is subject to updating, revision and amendment. The Company makes no representation or warranty (express or implied) as to the completeness ofthe information contained herein.All references in this presentation to dollars, “$” or “C$” are to Canadian dollars, and all references to “US$” are to United States dollars.Market And Industry DataThis presentation includes market and industry data and forecasts that were obtained from third-party sources, industry publications and publicly available information as well as industry dataprepared by management on the basis of its knowledge of the logistics and air cargo sector in which the Company operates (including management’s estimates and assumptions relating to theindustry based on that knowledge). Management’s knowledge of the logistics and air cargo sector has been developed through its experience and participation in the industry. Management believesthat this industry data is accurate and that its estimates and assumptions are reasonable, but there can be no assurance as to the accuracy or completeness of this data. Third-party sources generallystate that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurances as to the accuracy or completeness of included information.Although management believes it to be reliable, it has not independently verified any of the data from third-party sources referred to in this presentation, or analyzed or verified the underlying studiesor surveys relied upon or referred to by such sources, or ascertained the underlying economic assumptions relied upon by such sources.Cautionary Note Regarding Forward-Looking InformationThis presentation includes certain forward-looking statements that are based upon current expectations which involve risks and uncertainties associated with the Company and the environment inwhich the business operates. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements including those identified by theexpressions “anticipate”, “believe”, “plan”, “estimate”, “expect”, “intend”, “project” and similar expressions to the extent they relate to the Company or its management. The forward-lookingstatements are not historical facts but reflect Cargojet’s current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertaintiesthat could cause actual results or events to differ materially from current expectations. Examples of the factors that can affect the results are government regulations, competition, seasonalfluctuations, international trade, climate-change, retention of key personnel, labour relations, terrorist activity, general industry condition and economic sensitivity, the Company’s ability to managegrowth and profitability, fuel prices, other cost controls and foreign exchange fluctuations, and capability of maintaining its fleet. The risks and uncertainties are detailed in the “Risk Factors” sections ofthe Company’s Annual Information Form for the year ended December 31, 2024 and the Company’s Management’s Discussion & Analysis for the year ended December 31, 2024 and the three-monthperiod ended March 31, 2025, which are filed on SEDAR+ at www.sedarplus.ca and the Company is not aware of any significant changes to its risk factors from those disclosed at that time.Forward-looking statements are based on a number of material factors, expectations or assumptions of the Company which have been used to develop such statements and information but whichmay prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed onforward-looking statements because the Company can give no assurance that such expectations will prove to be correct. The statements are based on the following factors: the continued and timelydevelopment of infrastructure, continued availability of debt financing and cash flow, future commodity prices, currency, exchange and interest rates, regulatory framework regarding taxes andenvironmental matters in the jurisdictions in which the Company operates.This presentation contains forward-looking statements that reflect management’s current expectations related to matters such as future financial performance and liquidity and capital resources ofthe Company. Specific forward-looking statements in this presentation include, but are not limited to, statements with respect to the Company’s aircraft fleet.
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2 Non-IFRS Financial MeasuresThis presentation makes reference to certain non-International Financial Reporting Standards (“IFRS”) measures, non-IFRS ratios and supplementary financial measures to evaluate the performance ofthe Company. The terms “EBITDA”, “Adj. EBITDA”, “Standardized Free Cash Flow”, “Adj. Free Cash Flow”, “Maintenance Capital Expenditures”, “Growth Capital Expenditures”, “Net Debt”, and “TotalAdj. Debt” are non-IFRS financial measures; the term “Adj. EBITDA Margin”, “Adj. Free Cash Flow Margin”, “Adj. Free Cash Flow Conversion”, “Net Debt to Adj. EBITDA”, “Total Adj. Leverage Ratio”, and“Adj. EBITDA to Interest Expense” are non-IFRS ratios; and “Current Liquidity Position” and “Capital Intensity” are supplementary financial measures, all of which do not have any standardized meaningprescribed within IFRS and therefore may not be comparable to similar measures presented by other companies. Investors are cautioned that such measures should not be considered in isolation oras a substitute for measures of performance prepared in accordance with IFRS. Management believes that the non-IFRS financial measures provide a more consistent basis to compare theperformance of the Company between the periods and improve comparability between other companies including other airlines. They provide additional information to readers of this presentation toenhance their understanding of the Company’s financial performance. These measures are also used by the Company to guide its decisions on dividend policy, to set financial targets for itsmanagement incentive plans and to monitor the Company’s compliance with its debt covenants. Please see Appendix II of this presentation for a reconciliation of the non-IFRS measures included inthis presentation to the most closely comparable IFRS measure.Non-IFRS Financial Measures:“EBITDA” is defined as earnings before interest, taxes, depreciation and amortization. EBITDA is calculated as net income or loss excluding the following: depreciation of property, plant and equipment,interest and provision for current and deferred income taxes. EBITDA is a measure of the Company’s operating profitability and by definition excludes certain items as detailed above.“Adj. EBITDA” is defined as EBITDA excluding the following: share-based compensation, gain or loss on disposal of property, plant and equipment and assets held for sale, impairment and gain oninsurance claim, fair value increase or decrease on stock warrant, amortization of stock warrant contract assets, gain or loss on fair value or settlement of swap derivatives, unrealized foreign exchangegains or losses, gains or losses on settlement of debts, share of gain or loss in associate, and provision for employee pension. Adj. EBITDA is a measure of the Company’s operating profitability andexcludes certain items as detailed above. Management views these items as non-cash or non-operating.“Standardized Free Cash Flow” is defined as cash flows from operating activities as reported in the Company’s IFRS financial statements, including operating cash flows provided from or used indiscontinued operations; less: total maintenance capital expenditures minus proceeds from the disposition of capital assets other than those of discontinued operations, as reported in the Company’sIFRS financial statements.“Adj. Free Cash Flow” is defined by the Company as Standardized Free Cash Flow (as defined by management), less operating cash flows provided from or used in discontinued operations, changes inworking capital, plus the provision for current income taxes.“Maintenance capital expenditures” are defined as any fixed assets acquired during a reporting period to maintain the Company’s aircraft fleet and other assets at the level required to continueoperating the existing business. They also include any capital expenditures required to extend the operational life of the fleet including heavy maintenance. Maintenance capital expenditures excludeany capital expenditures that result in new and additional capacity required to grow operational revenue and cash flows.“Growth capital expenditures” are discretionary investments of the Company to increase capacity, geographic reach and to acquire more customers with a purpose to grow operational revenue,profits and cash flows.“Net Debt” is defined as the sum of long-term debt (including the 5.25% Debentures and lease liabilities), less cash and cash equivalents.“Total Adj. Debt” is defined as the sum of long-term debt (excluding the 5.25% Debentures).Non-IFRS Ratios:“Adj. EBITDA Margin” is defined as the Company’s Adj. EBITDA as a percentage of revenue.“Adj. Free Cash Flow Margin” is defined as Adj. Free Cash Flow divided by revenue.“Adj. Free Cash Flow Conversion” is defined as Adj. Free Cash Flow divided by Adj. EBITDA.“Net Debt to Adj. EBITDA” is the Company’s Net Debt divided by Adj. EBITDA.“Total Adj. Leverage Ratio” is the Company’s Total Adj. Debt divided by Adj. EBITDA.“Adj. EBITDA to Interest Expense” is the Company’s Adj. EBITDA divided by Interest Expense.Supplementary Financial Measures:“Current Liquidity Position” is defined as the Company’s available capacity under its credit facility (less letters of credit) plus cash.“Capital Intensity” is defined as capital expenditures divided by revenue. Cautionary Statement (Cont’d)
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Agenda1.Cargojet Overview2.Cargo Service Type Overview3.Financial OverviewAppendixI.Supplementary Business InformationII.Historical Financials
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5051015202530354045 ($200)$0$200$400$600$800$1,000$1,200 2014A 2015A 2016A 2017A 2018A 2019A 2020A 2021A 2022A 2023A 2024A(1) Adj. EBITDA is a non-IFRS measure. See “Cautionary Statement – Non-IFRS Financial Measures” in this presentationfor a definition of this measure and certain related information.(2) Represents Great Vision Express, China-based cross border e-commerce logistics provider.(3) Based on publicly issued credit ratings.(4) Customer tenure based on inaugural commercial agreement. Agreement Extension(January 2023)~6.5 Years + 1.5-Year OptionOwned AircraftLeased AircraftRevenueAdj. EBITDA(1)Inaugural Commercial Agreement(February 2014)7 Years + Three 36-Month Renewal OptionsRenewal Agreement(October 2017)Exercise of 1st36-Month OptionRenewal Air Cargo Services Agreement(August 2015)10 Years + 2-Year Renewal Option Initial Agreement(2015)Undisclosed Inaugural Commercial Agreement(August 2019)7.5 Years Renewal Agreement(April 2021)4 Years + Three 2-Year Renewal Options Inaugural Commercial Agreement(March 2022)5 Years + 2-Year Option(4) Select Key Commercial Agreements History Business OverviewFounded in 2002 and headquartered in Mississauga, ON, Cargojet is Canada’s leading air cargo operator, providing time sensitive services to 90%+ of the Canadian population̶Operates a fleet of 41 freighter aircraft (36 owned), serving 16 major Canadian cities̶54 international alliances / partnerships with leading global carriers̶Only national overnight air cargo consolidatorService offering includes a domestic air cargo network, dedicated routes under Aircraft, Crew, Maintenance & Insurance (“ACMI”) contracts, scheduled international routes and dedicated aircraft on an ad hoc charter basisIn 2002, Cargojet transitioned from a third-party ACMI operator into a fully integrated carrier that operates owned aircraft with a Canadian airline licenseCargojet has a track record of maintaining key strategic customer relationships, reflecting its strong service reliability Highly Creditworthy Counterparties(3)(4) Customer Tenure: 10+ yearsCredit Rating (Morningstar DBRS): AAA Renewal Agreement(November 2022)5 Years Inaugural Agreement(June 2024)3 Years (2) Customer Tenure: ~21 yearsCredit Rating (Moody’s / S&P): A2 / A Customer Tenure: ~6 yearsCredit Rating (Moody’s / S&P): A1 / AA Customer Tenure: 3+ yearsCredit Rating (Moody’s / S&P): A2 / n.a. Business Overview$ millions # AircraftNet Income
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638%28%18%16%65%4%8%23%Cargojet’s mix of volume-centric business has decreased by almost half since 2012, leading to increased revenue stabilityRevenue by Cargo Service Type – 2012 vs. Current$ millions, unless stated otherwiseHigh Quality Customer Base Charters /InternationalACMI / CMI(Aircraft, Crew, Maintenance & Insurance)Domestic Network~18%~28%~38%% Of LTM Revenue(1) Ad hoc charters on weekends and daytime utilizing idle aircraft that operate in Domestic and ACMI networksPriced per flightNew contract in 2024 for scheduled charter services between China and CanadaCurrently operates 17 aircraft on a long-term ACMI and interchange basis with 21AirGenerates relatively high EBITDA margin given flight costs are carried directly by the customer Strategic alignment with key customers supported by long-term, block-hour based contracts that ensure high revenue visibility and operational stickinessOvernight domestic air cargo network covering 16 cities and transporting 25+ million pounds of time-sensitive cargo weekly~75% of domestic network revenue under long-term contractsWeight and cargo space pre-purchased by customersContracts include variable surcharges for uncontrollable costs, guaranteed volume minimums & CPI-based annual price increasesDescriptionKey CustomersDomestic / InternationalKey Geographies Surcharge & OthersCharterDomesticACMI~$169 million2012A Revenue LTM Q1/25A Revenue~$1.0 billion(1) Sum of the three service types does not equal 100% as figures exclude Fuel Surcharge & Other and Amortization of Contract Assets. Highly Diversified Platform
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7 High Barriers To EntryCommercial air transportation regulations, foreign ownership restrictions, and other factors result in barriers to entry for the Canadian domestic air cargo marketWith limited competitive intensity, Cargojet is well-positioned to maintain its leading market position Foreign air carriers, international courier companies and air cargo service providers are prevented from establishing domestic routes within Canada due to cabotage restrictionsCabotage RestrictionsAir carriers are limited to foreign ownership of any Canadian airline to a maximum of 49%, preventing U.S.-owned cargo airlines such as Amazon Air from operating routes between two Canadian pointsForeign Ownership RestrictionsNew entrants must obtain an air operator certificate from Transport Canada, specific to aircraft type, which typically takes a year to complete due to system and documentation requirementsLicensing RequirementsCanada’s smaller market size supports fewer players, and Cargojet’s ~99% on-time record makes it challenging for new entrants to win shareAbility To Capture Client BaseMany of Cargojet’s customers have synchronized their networks to Cargojet’s and have hubs in Hamilton, Ontario resulting in increased customer stickinessNetwork Alignment Leading Market Position With High Barriers To Entry Operational Excellence – At A Glance 90%+DomesticMarket Share~75%ContractedVolume4 – 10yr.Avg. InitialContract Length~99%On-TimeDeliveries Irreplicable Infrastructure Drives Moat Economies of scale and irreplicable infrastructure strongly positions Cargojet’s domestic business Critical Mass With CustomersSwitching Costs & Risk Of FailureCanada’s East-To-West Carrier Infrastructure
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8 Long-Term Contracts With Blue-Chip Customers Provide Earnings VisibilityKey Strategic Partnerships OverviewAdditional DetailsWarrantsTermContract DateCredit Rating(1) ~346,000 warrants vested immediately upon issuance, and the vesting of the remaining warrants is tied to the delivery of up to $2.3 billion in business volumes over the term of the agreementSubject to minimum volume guarantees, surcharges for fuel & other controllables costs and annual price increases linked to CPIIn March 2022, Cargojet issued ~1.6 million warrants to DHL with an exercise price of $158.92 per share5 Years + 2-Year Renewal OptionMarch 2022(Inaugural Agreement)Moody’s / S&P: A2 / n.a.Subject to minimum volume guarantees, surcharges for fuel & other controllables costs and annual price increases linked to CPIn.a.~6.5 Years + 1.5-Year OptionFebruary 2014(Inaugural Agreement)October 2017(Renewal Agreement)January 2023(Agreement Extension)Morningstar DBRS: AAA 401,000 warrants vested immediately upon issuance, and the remaining warrants vest in specified increments over a period of 7.5 years and based on the delivery of up to $600 million in total business volumeSubject to minimum volume guarantees, surcharges for fuel & other controllables costs and annual price increases linked to CPIIn August 2019, Cargojet issued warrants to Amazon in two tranches representing ~1.6 million and 0.8 million warrants, with exercise prices of $91.78 and $186.57 per share, respectively4 Years + Three 2-Year Renewal Options(One 2-Year Renewal Option Exercised in 2025)August 2019(Inaugural Agreement)April 2021(Renewal Agreement)Moody’s / S&P: A1 / AASubject to minimum volume guarantees, surcharges for fuel & other controllables costs and annual price increases linked to CPIn.a.5 YearsApril 2003(Inaugural Agreement)November 2022(Renewal Agreement)Moody’s / S&P: A2 / A Contract CharacteristicsGuaranteed volume minimums where customers have paid for guaranteed space on the aircraftMinimum Volume GuaranteesLong-term contracts have an average initial contract length of 4 – 10 years and typically contain extension optionsApproximately 75% of domestic revenues are under long-term contractsLength Of ContractBuilt-in automatic annual price increases linked to CPICPIEscalatorsFuel charges passed on to customers in connection with delivery of their serviceFuel Surcharge MechanismsSurcharges for uncontrollable cost increases such as regulatory changes̶Includes additional costs of recruiting, training and retaining new pilots to meet the government-imposed fatigue regulationSurcharges For Other Uncontrollable Costs (1) Based on publicly issued credit ratings. Accounted for ~16% of Total Revenue in Q1/2025
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9 Boeing 767-300 FreighterMaximum Payload: 125,000 poundsMaximum Range:6,000 Nautical MilesOwned: 17Leased: 4 Boeing 757-200 FreighterMaximum Payload: 80,000 poundsMaximum Range:3,900 Nautical MilesOwned: 17Leased: -- Boeing 767-200 FreighterMaximum Payload: 100,000 poundsMaximum Range:5,000 Nautical MilesOwned: 2Leased: 1 (1) Based on aircraft hull and engines as of March 31, 2025.(2) Forward-looking information see “Cautionary Statement – Cautionary Note Regarding Forward-Looking Information” in this presentation. Efficient Aircraft Fleet With Capacity To GrowRobust and scalable fleet of 41 freighters (88% owned), with capacity growing in step with contract wins and customer demand growth̶ Ongoing fleet growth supported by three B767s currently under conversion and two additional B767s held in feedstock for future deployment̶ Modular fleet drives incremental efficiency with no pilot re-training required across the fleet̶ Fleet net book value of ~$1.2 billion(1) Number Of Aircraft In ServiceLeased / OwnedAircraft TypePlan(2)ActualDec 31,March 31,Dec 31,2027202620252025202444444LeasedFreighterB767-3002121211717OwnedFreighterB767-30022222OwnedFreighterB767-20000011LeasedFreighterB767-2001717171717OwnedFreighter B757-2004444444141Total Aircraft
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10(1) Source: Statista historical and forecast; assuming 9% YoY growth for 2028 and 2029 per Boeing World Air Cargo Forecast.(2) Source: IATA.(3) Source: Boeing Commercial Market Outlook.(4) Source: CargoFacts 2025 and Evercore WB Freighter Supply Demand.(5) Source: STAT Trade Times. Attractive air cargo demand fueled by e-commerce growthAir cargo remains critical in servicing the digital economy and has experienced a strong rebound following an extended period of global economic uncertainty in 2023 driven by a surge in e-commerce volumeGlobal e-commerce sales is expected to grow at a ~9.0% CAGR from 2025 to 2029(1)E-commerce makes up ~20% of global air cargo volume and is expected to reach ~20 – 25% of global air cargo volumes in 2027(2)~80% of cross-border e-commerce is carried by air transport(2)Cargojet customers are all levered to e-commerce tailwinds globally and in CanadaCargojet customers, DHL, Amazon, UPS and Great Vision are all strong and growing e-commerce storiesCargojet’s partnership with fast-growing e-commerce players ensures sustained and accelerating volumes, reinforcing its competitive advantage Upward demand trajectory coupled with increasing industry capacity Air cargo demand grew 5.8% Y/Y in April 2025(2)and air cargo traffic (RTK) is expected to average ~4.1% annual growth from 2024 to 2043(3)Industry capacity saw robust growth in 2023 and 2024 driven by an increase in belly-hold capacity of international passenger flights and is expected to expand ~5.8% Y/Y in 2025(2)Essential nature of freighter services to the global air cargo market Freighters remain the preferred transportation vehicle in the global air cargo market given their ability to service key air cargo hubs and meet specific timing requirements & cargo specifications(3)~54% of global air cargo traffic have historically been transported by main-deck freighters and ~60 – 70% of air cargo traffic between 2020 and 2023 was carried by freighters due to the significant reduction in passenger flights(3)Structural shortage in the supply of air cargo servicesAlthough global freighter fleet growth is projected to be 2.1% per year over the next two decades, supply growth across large and medium segments is expected to remain below demand levels(4)– The cargo traffic (RTK) is forecasted to grow at 4.1%, while freighters are forecasted to grow at 2.6% into 2043(3)The end of 767 production in 2027 due to new emissions requirements will further constrain supply among widebodies(5) The global Air Cargo sector continues its strong growth trajectory supported by e-commerce growth and other favourable long-term industry tailwinds E-Commerce Tailwind Drives Secular Growth Story Insulated From Cyclicality $1.6 $1.9 $2.4 $3.0 $3.4 $4.3 $5.0 $5.3 $5.8 $6.3 $6.9 $7.5 $8.0 $8.8 $9.5 2015A 2016A 2017A 2018A 2019A 2020A 2021A 2022A 2023A 2024A 2025E 2026E 2027E 2028E 2029E Global E-Commerce Sales Growth Forecast(1)US$ trillions
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11 $156 $282 $293 $334 32.1%42.1% 38.7%32.7% 2019A 2020A 2021A LTM Q1/25A$22 $16 $24 $334 14.3%7.9%16.5%32.7% 2007A 2008A 2009A LTM Q1/25A$151 $206 $144 2007A 2008A 2009A (1) Adj. EBITDA and Adj. EBITDA Margin are a non-IFRS measure and a non-IFRS ratio, respectively. See “Cautionary Statement – Non-IFRS Financial Measures” in this presentation for a definition of these measures and certain related information.(2) Source: Boeing World Air Cargo Forecast.050100150200250300 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 20229/11Global financial crisisEurozone crisisChinese stockcrashU.S.- Chinatraderelations;COVIDGeopolitical tension;high inflation GFC Financial Performance - Resilient Operations ($ millions)$487 $669 $758 2019A 2020A 2021A COVID-19 Financial Performance - Significant Uptick ($ millions)13%36%19% World Air Cargo Market Resilience(2) While global cargo volumes plummeted during the 2008 Global Financial Crisis (“GFC”) and the initial stages of the 2020 COVID-19 pandemic, Cargojet maintained profitability and remains well-positioned to weather future downturns due to its leading market position, long-term contracts and strong alignment with secular tailwinds Cargojet grew revenue over a 2-year cumulative period (2007 – 2009), despite significant volatility for passenger airlines / e-commerce; In 2008 – 2009, Cargojet’s business was purely a domestic overnight business and has since diversified Cargojet grew revenue and margins over a 2-year cumulative period (2019 – 2021) driven by growth in e-commerce and shortage of belly capacity on commercial passenger aircraft Cyclically Resilient Business Model Long-Term Air Cargo Traffic Growth TrendlineSignificant Geopolitical EventsGlobal Air Cargo Traffic (in CTKs) Global Air Cargo Growth / Traffic (CTKs) $5($0)$9 Revenue Y/Y GrowthNet IncomeAdj. EBITDA Margin(1)Adj. EBITDA(1)Revenue7%37%13%$12($88)$167 Revenue Y/Y GrowthNet IncomeAdj. EBITDA Margin(1)Adj. EBITDA(1)Revenue $124$124 Bar Chart Not To Scale
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12 Founded the company alongside Jamie Porteous and previously served as the President and CEO of Cargojet from its inception until November 2023 when he was appointed as Executive ChairmanOver 44 years of experience in the transportation industry, having previously worked as SVP of Cottrell Transport and President and CEO of Commercial Transport InternationalAjay VirmaniExecutive ChairmanAppointed Co-CEO in November 2023; has been a member of Cargojet team since inceptionPreviously served as Chief Corporate Officer and has led several functions including Marketing, Brand, Government Relations, Human Resources, Legal, Facilities and Operational Efficiency Extensive background in transportation and logistics and is responsible for all aspects of support functions as well as ground operations globallyPauline DhillonCo-Chief Executive OfficerAppointed Co-CEO in November 2023; has been a member of Cargojet team since inceptionPreviously served as Chief Strategy Officer and has 20+ years of experience in the airline industryWas an original partner of the investment group that purchased the assets of Royal Cargo Inc., which formed Canada 3000 Cargo Inc. and would later become CargojetJamie B. PorteousCo-Chief Executive OfficerJoined Cargojet in 2005Has served as Vice President, Finance at Cargojet since 2020Previously served as acting CFO at Cargojet during 2021Sanjeev Maini(1)Acting Chief Financial Officer(VP, Finance) Management Team High Quality And Experienced Management (1) Aaron McKay has been appointed as Chief Financial Officer, effective August 1, 2025.
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14 $264 $300 $325 $366 $355 $376 2019A 2020A 2021A 2022A 2023A 2024A2003Cargojet took over the UPS Canada contract and entered into marketing alliances with Air France, British Airways and Korean Air, operating six domestic flights each weeknight Cargojet’s Domestic business operates across North America, transporting over 25 million pounds of time-sensitive cargo weekly, reaching 90%+ of the Canadian populationOperates over 80 flight legs each night with a domestic network air cargo co-load network between 16 major Canadian citiesStrong revenue visibility as ~75% of domestic network revenue is secured under long-term contracts with fuel cost pass-through provisions and option for renewal–Contracts are protected with surcharges for uncontrollable costs, guaranteed volume minimums and CPI-based automatic annual price increases Domestic volumes continue its upward trajectory, supported by an increase in e-commerce and B2B volumes Description Key Customers Vancouver(YVR)Calgary(YYC)Edmonton(YEG)Saskatoon(YXE)Regina(YQR)Winnipeg(YWG)Thunder Bay(YQT)Toronto(YYZ)Hamilton(YHM)Ottawa(YOW)Montreal(YUL)Mirabel(YMX)Moncton(YQM)Halifax(YHZ)St John’s(YYT)Iqaluit(YFB)Cargojet operates its network across North America transporting over 25 million pounds of time-sensitive cargo weekly2019Cargojet entered into a strategic agreement with Amazon in connection with their existing commercial agreement for overnight air cargo services and chartersCargojet continues to enjoy strong demand for its domestic and international air cargo services 2008Cargojet completed its fleet renewal program with the introduction of two Boeing 767 and one Boeing 757 aircraft, representing significant expansion of capacity and operating capabilities % of Revenue(1)Domestic – Revenue Growth ($ millions) Map of OperationsKey Milestones 43%37%40%38%45%Domestic Network – Cargo Service Type Overview (38% of Revenue(1))54%7% CAGR(‘19A – ‘24A) 2014Cargojet entered into a 6.5-year agreement with Canada Post Group of Companies, including Purolator for overnight air cargo services and charters (1) Based on LTM Q1/25A; sum of the three cargo service types does not equal 100% as figures exclude Fuel Surcharge & Other and Amortization of Contract Assets.
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15 $66 $132 $176 $247 $257 $294 2019A 2020A 2021A 2022A 2023A 2024A Cargojet provides and operates dedicated aircraft on an ACMI basis, operating between points in Canada, North America, South America and Europe̶This service involves providing a dedicated aircraft on a dedicated route where the customer is responsible for all costs of the operation including fuel, navigation fees, landing fees, cargo handlingand all other commercial activities. Minimum guaranteed revenues are part of the contractCargojet operates 17 dedicated long-term aircraft and 2 aircraft on an interchange basis with 21Air between Canada, the USA, Mexico, Central America and South AmericaACMI revenues produce consistent EBITDA margins as flight costs such as fuel, navigation charges, landing fees and ground handling charges are borne directly by the customerDescription Key Customers ACMI – Revenue Growth ($ millions) Map of Operations SHANGHAI(PVG)NARITA(NRT)MEXICO CITY(NRT)GUADALAJARA( GDL)QUERETARO(QRO)MONTERREY (MTY)HAVANA(HAV)MIAMI(MIA)BOGOTA(BOG)BERMUDA (BDA)NEWARK(EWR)NEW YORK(JFK)CINCINNATI(CVG)VANCOUVER(YVR)EDMONTON(YEG)CALGARY(YYC)WINNIPEG(YWG)HAMILTON(YHM)MIRABEL(YMX)HALIFAX(YHZ)ST. JOHN’S(YYT)EASTMIDLANDS(EMA)COLOGNE(CGN) VIRACOPOS(VCP) Key Milestones2018Cargojet began operating two new scheduled ACMI routes between Canada & the USA and the USA & Mexico2019Cargojet began operating a new scheduled ACMI route to USA and Mexico, operating 6 flights per week with a dedicated B767‐300 aircraft 2020Cargojet announced the expansion of its dedicated ACMI aircraft agreement with DHL Express with the addition of three international routes2021Cargojet and Amazon entered into a new four-year ACMI agreement; Cargojet began operating three new scheduled domestic ACMI routes between Canada and the UK % of Revenue(1)ACMI – Cargo Service Type Overview (28% of Revenue(1))23%25%29%28%20%35% CAGR(‘19A – ‘24A)14% (1) Based on LTM Q1/25A; sum of the three cargo service types does not equal 100% as figures exclude Fuel Surcharge & Other and Amortization of Contract Assets.
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16 $33 $122 $90 $113 $100 $159 2019A 2020A 2021A 2022A 2023A 2024A To further enhance its revenues, Cargojet offers a specialty charter service utilizing the same aircraft that operate in its domestic and ACMI networks, but typically in the daytime and on weekends when the aircraft are not being used for other missions̶The charter business targets livestock shipments, military equipment movements, emergency relief supplies and virtually any large shipments requiring immediate delivery across North America, South America, the Caribbean and EuropeDuring pre‐Christmas peak volume seasons, Cargojet also offers dedicated aircraft to its major courier customers to handle increased United States‐Canada premium overnight trafficGiven that the fixed costs of the aircraft used in the charter operations are already covered by its domestic and ACMI pricing and revenue, Cargojet is able to generate strong profitability and price competitively in the ad-hoc charter marketCharter revenues grew ~59% YoY in FY2024A driven by scheduled charter services between China and Canada, which started in FY24 DescriptionCharter – Revenue Growth ($ millions)% of Revenue(1) Key CustomersAugust 2019 Cargojet entered into a new strategic agreement with Amazon for overnight cargo and chartersJune 2024Cargojet entered into a three-year agreement with China-based Great Vision HK Express to provide scheduled charter services—from Hangzhou, China to Vancouver, B.C., and from Vancouver, B.C. to Hangzhou, ChinaMarch 2022Cargojet entered into a new strategic agreement with DHL for overnight air cargo services and charters Key Milestones Charter – Cargo Service Type Overview (18% of Revenue(1))12%12%11%18%18%7%37% CAGR(‘19A – ‘24A) (1) Based on LTM Q1/25A; sum of the three cargo service types does not equal 100% as figures exclude Fuel Surcharge & Other and Amortization of Contract Assets.
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18 Building Long-Term Relationships & Adding Capacity to Meet Known Demand1 4Maintaining A Conservative Balance Sheet 2Driving Adjusted EBITDA MarginExpansion 5Disciplined Approach To Capital Allocation 3 Growing AdjustedFree Cash Flow Net Debt(2): $833 million, with net leverage of ~2.5x(3)Liquidity(4): $281 million in undrawn revolver and cash GUIDING PRINCIPLES FOR CAPITAL ALLOCATIONMaintain Financial Leverage Within 1.5x – 2.5x RangeExpected Return On Invested Capital Higher Than Weighted Average Cost Of Capital (1) Net Debt to Adj. EBITDA and Adj. EBITDA to Interest Expense are non-IFRS ratios. See “Cautionary Statement – Non-IFRS Financial Measures” in this presentation for a definition of these measures and certain related information.(2) Includes 5.25% Debentures and lease liabilities.(3) Represents Net Debt / LTM Adj. EBITDA.(4) Liquidity is calculated as ~$275 million available Revolving Credit Facility capacity less ~$1 million of outstanding letters ofcredit, plus ~$7 million of cash. Financial Priorities – Disciplined Balance Sheet Management Net Debt to Adj. EBITDA(1)(2) Adj. EBITDA to Interest Expense(1)5.3x5.8x6.2x2023A 2024A LTM Q1/25A 2.5x2.3x2.5x2023A 2024A LTM Q1/25A
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19$48 $197 $147 $165 $260 $247 $91 9.9%29.4%19.3%16.9%29.6%24.7%8.9% 2019A 2020A 2021A 2022A 2023A 2024A LTM Q1/25A $156 $282 $293 $329 $301 $331 $334 $12 ($88)$167 $191 $37 $108 $124 32.1%42.1%38.7%33.5%34.3%33.1%32.7% 2019A 2020A 2021A 2022A 2023A 2024A LTMQ1/25A $134 $84 $165 $482 $168 $103 $134 $85 $63 $113 $129 $98 $147 $215 $218 $147 $278 $611 $267 $250 $349 44.8%21.9%36.6%62.4%30.4%25.0%34.2%2019A 2020A 2021A 2022A 2023A 2024A LTMQ1/25A $264 $300 $325 $366 $355 $376 $391 $66 $132 $176 $247 $257 $294 $282 $33 $122 $72 $113 $100 $159 $185 $487 $669 $758 $980 $878 $1,001 $1,020 2019A 2020A 2021A 2022A 2023A 2024A LTMQ1/25A 37%13%29%(10%)Total Revenue Y/Y GrowthRevenue(1)($ millions)Adj. EBITDA(5)And Net Income ($ millions) Adj. Free Cash Flow(4)(5)($ millions) 16%(2)7% (1) Revenue categories presented exclude Fuel Surcharge & Other and Amortization of Contract Assets; Total Revenueincludes Fuel Surcharge & Other and Amortization of Contract Assets.(2) Represents Y/Y growth compared to LTM Q1/24A.(3) Capital Intensity is a supplementary financial measure and is defined as Capital Expenditures / Revenue.(4) All years based on Cargojet’s previous definition of Cash Flow From Operations less Maintenance Capital expenditures,plus Proceeds From Disposal Of Property, Plant & Equipment, plus Other Items; includes Proceeds From Disposal of Planes.(5) Adj. EBITDA, Adj. EBITDA Margin, Adj. Free Cash Flow, Adj. Free Cash Flow Margin, Maintenance Capital Expenditures, and Growth Capital Expenditures are non-IFRS measures and non-IFRS ratios. See “Cautionary Statement – Non-IFRS Financial Measures” in this presentation for a definition of these measures and certain related information. Adj. EBITDA Margin(5) Adj. Free Cash Flow Margin(5) DomesticACMIAll-In Charter Capital Intensity(3) 14% Growth(5) Financial Overview – Historical Financials Capital Expenditures ($ millions)Maintenance(5) Adj. EBITDA(5)Net Income
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22 Amazon Hamilton Airport Investment (YHM1)Amazon opened its 855,000 sq. ft. fulfillment center in Hamilton adjacent to the Airport to further improve its network efficiencyFacility opened in January 2022This new fulfillment center is expected to further improve Amazon’s delivery times for Canadian customers 12 Cargojet’s long-term strategic partnerships with global carriers are resulting in closer integration of its networks creating greater stickiness DHL Express International Gateway FacilityIn September 2021, DHL opened $110 million Canadian international gateway facility next to Cargojet’s Hamilton airport hub238,000 sq. ft. facility is DHL’s largest gateway in Canada and can process up to 28,000 packages per hourDHL is now flying Canadian cargo directly into Hamilton instead of routing cargo via Cincinnati Customer Network Strategies Synchronized With Cargojet 34 UPS Hamilton Airport Sort FacilityUPS has maintained the Hamilton airport sort facility since early 2000’s coinciding with the start of Cargojet relationshipThe network design is tightly linked to departures and arrivals of Cargojet flights as well as international links to/from CanadaPurolator Hamilton Airport Sort FacilityPurolator has maintained presence at Hamilton airport that predates Cargojet relationshipSince 2014, Purolator has been able to further expand its reach into more cities using Cargojet networkVolumes handled at Hamilton facility have gone up steadily reflecting the growth experienced by Purolator
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24 Income Statement 2022A 2023A 2024A LTM Q1/25ARevenueDomestic Overnight Revenue $366 $355 $376 $391All In Charter Revenue $113 $100 $159 $185ACMI Revenue $247 $257 $294 $282Lease and Other Revenue $25 $22 $24 $24Domestic Network, ACMI and Charter Revenues $750 $734 $852 $882Fuel Surcharge & Recovery Revenue $241 $186 $170 $159Amortization of Warrant Contract Asset ($12) ($43) ($21) ($21)Total Revenue $979.9 $878 $1,001 $1,020Revenue Growth %29.3%(10.5%)14.1%16.3%Total COGS ($732) ($740) ($775) ($786)Gross Margin $248 $138 $226 $234Gross Margin %25.3%15.7%22.6%22.9%Total Operating Expenses ($75) ($71) ($91) ($90)EBIT $173 $68 $135 $144Less: Interest Expense $47 ($16) $2.5 $6EBT $220 $52 $138 $150Less: Deferred Income Tax Provision ($29) ($14) ($29) ($26)Net Income $191 $37 $108 $124 HistoricalHistorical Financials$ millions, unless noted otherwise
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25 2019A 2020A 2021A 2022A 2023A 2024A LTM Q1/25ANet Income $12 ($88) $167 $191 $37 $108 $124Add: Interest Expense $44 $40 $31 $34 $57 $57 $54Add: Provision For Deferred Taxes $9 $44 $33 $29 $14 $29 $26Add: Depreciation Of Property, Plant & Equipment $94 $100 $116 $142 $179 $165 $163EBITDA $158 $95 $348 $396 $287 $360 $366Add: Stock-Based Compensation -- ($10) $17 ($1) $12 $10 $5Add: (Gain) / Loss On Disposal Of Property, Plant & Equipment ($1) ($1) ($0) ($1) $3 ($17) $0Add: Impairment Of Property, Plant & Equipment -- $1 -- -- -- -- --Add: Impairment & Gain On Insurance Claim -- -- -- -- $4 $3 $2Add: Fair Value Adjustment & Amortization Of Stock Warrant Contract Assets $3 $186 ($72) ($111) ($2) ($26) ($48)Add: (Gain) / Loss On Swap Derivative ($3) -- -- $37 ($3) ($3) $3Add: Unrealized FX (Gain) / Loss ($4) ($3) $0 $4 ($1) $6 $6Add: Loss on Extinguishment of Debts -- -- $5 -- $1 $0 $0Add: Share Of (Gain) / Loss In Associate -- -- -- $2 $0 ($0) ($0)Add: Employee Pension $4 $13 ($5) $3 -- $0 $1Adj. EBITDA $156 $282 $293 $329 $301 $331 $334Adj. EBITDA Margin (%) 32.1% 42.1% 38.7% 33.5% 34.3% 33.1% 32.7% Historical Adjusted EBITDA Reconciliation 2007A 2008A 2009ANet Income $5 ($0) $9Add: Interest Expense $1 $3 $4Add: Non-Controlling Interests $2 ($1) $3Add: Provision For (Recovery Of) Current Income Taxes ($2) ($1) $1Add: Provision For (Recovery Of) Future Income Taxes $2 ($1) ($2)Add: Loss (Gain) On Disposal Of Capital Assets $0 $1 $0Add: Loss (Gain) On Disposal Of Intangible Assets -- ($1) ($0)Add: Loss (Gain) On Debenture Redemption -- -- ($0)Add: Amortization Of Capital Assets $4 $5 $6Add: Amortization Of Intangible Assets $10 $12 $4Add: Aircraft Heavy Maintenance Amortization $2 $3 $2Add: Aircraft Heavy Maintenance Expenditures ($3) ($2) ($2)Add: Heavy Maintenance Deposits -- ($1) ($1)EBITDA From Continuing Assets $22 $16 $25Add: EBITDA From Discontinued Assets -- ($0) ($1)Adj. EBITDA $22 $16 $24Adj. EBITDA Margin (%) 14.3% 7.9% 16.5% HistoricalHistorical Financials (Cont’d)$ millions, unless noted otherwise
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26 Historical Financials (Cont’d)$ millions, unless noted otherwise (1) Includes changes in contract acquisition assets, trade & other receivables, inventories, prepaid expenses & deposits and trade & other payables.(2) All years based on Cargojet’s previous definition of Cash Flow from Operations less Maintenance Capital Expenditures, plus Proceeds from Disposal of Property, Plant & Equipment, plus Other Items; includes proceeds from disposal of planes. Adjusted Free Cash Flow Reconciliation2019A 2020A 2021A 2022A 2023A 2024A LTM Q1/25ANet Cash Generated From Operating Activities $145 $293 $231 $283 $192 $329 $313Less: Maintenance Capital Expenditures ($85) ($63) ($113) ($129) ($98) ($147) ($215)Less: Growth Capital Expenditures n.a n.a n.a n.a ($168) ($103) ($134)Add: Proceeds From Disposal Of Property, Plant & Equipment $1 $1 $0 $1 $127 $105 $5Add: Insurance Proceeds From Assets Held For Sale -- -- -- -- $12 -- --Standardized Free Cash Flow (As Reported) $62 $230 $119 $154 $64 $184 ($31)Less: Changes In Non-Cash Working Capital Items & Deposits ($13) ($34) $28 $11 n.a. n.a. n.a.Adj. Free Cash Flow (As Reported) $48 $197 $147 $165 $64 $184 ($31)Add: Growth Capital Expenditures -- -- -- -- $168 $103 $134Less: Insurance Proceeds From Assets Held For Sale -- -- -- -- ($12) -- --Add: Changes In Non-Cash Working Capital Items & Deposits -- -- -- -- $39 ($40) ($12)Adj. Free Cash Flow (As Presented) $48 $197 $147 $165 $260 $247 $91Capital Expenditures Schedule2019A 2020A 2021A 2022A 2023A 2024A LTM Q1/25AAdd: Maintenance Capital Expenditures $85 $63 $113 $129 $98 $147 $215Add: Growth Capital Expenditures $134 $215 $165 $482 $168 $103 $134Purchase Of Property, Plant & Equipment $218 $278 $278 $611 $267 $250 $349Historical Historical (2)(1)
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27 Cash Flow Statement2022A 2023A 2024ANet Income $191 $37 $108Depreciation Of Property, Plant & Equipment And Amortization Of contract assets $154 $221 $189Share-Based Compensation Expense ($4) $14 $10Finance Costs $34 $57 $57Impairment On Property, Plant & Equipment And Assets Held For Sale -- $16 $3(Gain) / Loss On Disposal of Property, Plant & Equipment And Assets Held For Sale ($1) $3 ($17)Realized Foreign Exchange Gain On Disposal Of Assets -- ($1) --Share-Based Compensation Paid -- ($12) ($2)Employee Pension Liability $4 $0 $0Pension Paid ($10) ($10) ($10)Provision For Income Tax $29 $14 $29Fair Value Increase (Decrease) On Stock Warrant ($122) ($45) ($47)Unrealized (Gain) / Loss On Swap Derivative Contract $37 ($3) $10Unrealized Foreign Exchange (Gain) / Loss $4 ($2) $6Loss On Extinguishment Of Debts -- $1 $0Share Of (Gain) / Loss In Associate $2 $0 ($0)Gain On Insurance Claim -- ($12) --Withholding Tax Paid On Vested RSUs ($0) ($1) ($1)Interest Paid ($24) ($47) ($47)Changes In Contact Acquisition Asset, Net Of Amortization ($2) ($5) --Changes In Trade And Other Receivables ($21) ($24) $16Changes In Inventories ($1) $1 $0Changes In Prepaid Expense And Deposits ($7) $3 $1Changes In Trade And Other Payables $18 ($14) $23Cash From Operating Activities $280 $192 $329Purchase of Property, Plant & Equipment ($611) ($266) ($250)Proceeds From Disposal Of Property, Plant & Equipment And Assets Held For Sale $1 $127 $105Insurance Proceeds From Assets Held For Sale -- $12 --Repayment From Long-Term Loans Receivables ($3) -- $2Cash From Investing Activities ($613) ($127) ($143)Redemption Of Debenture -- ($86) ($115)Proceeds From Borrowings $308 $146 $84Repayment Of Obligations Under Lease Liabilities ($29) ($43) ($31)Share Buyback ($17) ($36) ($128)Dividends Paid To Shareholders ($19) ($20) ($27)Cash From Financing Activities $244 ($39) ($216)Increase / (Decrease) In Cash ($89) $26 ($30)Opening Cash $95 $6 $32Ending Cash $6 $32 $2 HistoricalCash Flow StatementReflects the sale of one Boeing 777-300 aircraft and two Boeing 777-300 hulls in 2023A and four Boeing 777-200, one simulator and two Beechcraft in 2024APrimarily consists of additions to aircraft, engines, ground services equipment, leasehold improvements, rotable spares, maintenance, facilities and other equipment and sparesReflects debenture redemption activities; 2020 5.25% Debentures have maturities in 2026; 2019 5.75% Debentures were redeemed in Q4 2024 Cargojet purchased 1.1 million shares under its Normal Course Issuer Bid (“NCIB”) in FY2024 and renewed it in November 2024In Q3/24A, Cargojet increased dividends by ~11.25% from $0.31 per share to $0.35 per share Select Commentary1 1 2 2 3 3 41 $ millions, unless noted otherwiseHistorical Financials (Cont’d) 335 45
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28(1) Total Adj. Debt, Net Debt, Net Debt to Adj. EBITDA, Total Adj. Leverage Ratio, Adj. EBITDA to Interest Expense, Adj. Free Cash Flow and Adj. Free Cash Flow Conversion are non-IFRS measures and non-IFRS ratios. See “Cautionary Statement – Non-IFRS Financial Measures” in this presentation for a definition of these measures and certain related information.(2) Including 5.25% Debentures.(3) Excluding 5.25% Debentures.(4) All years based on Cargojet’s previous definition of Cash Flow from Operations less Maintenance Capital Expenditures, plus Proceeds from Disposal of Property, Plant & Equipment, plus Other Items; includes proceeds from disposal of planes.(5) Capital Intensity is a supplementary financial measure and is defined as Capital Expenditures / Revenue. $ millions, unless noted otherwiseHistorical Financials (Cont’d)Net Debt Schedule & Total Adj. Debt Reconciliation2022A 2023A 2024A Q1/25ANet DebtAdd: Lease Liabilities $89 $119 $104 $98Add: Revolving Credit Facility And Delayed Draw Term Loan $308 $454 $538 $629Total Adj. Debt $397 $573 $642 $727Add: Debentures $310 $226 $114 $114Total Debt $707 $799 $755 $840Less: Cash ($6) ($32) ($2) ($7)Net Debt $701 $767 $754 $833Key Metrics2022A 2023A 2024A LTM Q1/25ACredit MetricsNet Debt to Adj. EBITDA 2.1x 2.5x 2.3x 2.5xTotal Adj. Leverage Ratio 1.2x 1.9x 1.9x 2.2xAdj. EBITDA to Interest Expense 9.8x 5.3x 5.8x 6.2xOperational MetricsAdj. Free Cash Flow $165 $260 $247 $91Adj. Free Cash Flow Conversion 50% 86% 75% 27%Capital Intensity 62% 30% 25% 34% Historical Historical(1)(2)(1)(3)(1)(4)(1)(1)(5) (1)(1) (1)