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In line with previously stated strategic priorities to invest in growth opportunities and continue to pay down debt, the net proceeds from the Offering will be used to fund the following:
- Expand Domestic Capacity and Facilities. The COVID-19 pandemic has generally increased demand for Cargojet’s domestic air cargo services due to the dramatic increase in e-commerce activity. The Company intends to use a portion of the net proceeds of the Offering to fund growth capital expenditures including the acquisition of five B-767 freighter aircraft for delivery in 2021/2022, as well as investments in a new hanger and additional land-based facility infrastructure in
Canada . The infrastructure investments will support additional e-commerce volumes, driven by the ongoing pandemic, that are expected to establish a new higher baseline going forward. - Pursue
U.S. and International Growth Strategy. The COVID-19 pandemic has significantly increased demand for Cargojet’s international air cargo services. Air cargo capacity has been severely constrained due to the reduction of passenger aircraft operating on international routes and it is uncertain when such capacity will return to pre-pandemic levels. Furthermore,U.S. and international air cargo growth opportunities have emerged as a result of rapidly evolving global supply chains and a lack of air cargo capacity in key markets. The Company intends to use a portion of the net proceeds of the Offering to capitalize on potential strategic investments in theU.S. and the acquisition of two long-range B-777 freighter aircraft for international routes for delivery in 2023. - Repay Indebtedness. The Company plans to use a portion of the net proceeds of the Offering to discharge finance leases, including associated balloon payments, on six aircraft maturing in fiscal 2021 and fully pay down outstanding revolver balances. The Company remains committed to maintaining a strong balance sheet to support its long-term growth strategy and capitalize on new domestic and international growth opportunities.
The Company completed the year experiencing record volumes during the peak season, consistent with previously disclosed expectations, and delivered approximately 99% on time performance to its customers.
The Shares will be offered by way of a preliminary short form prospectus in all provinces and territories of
The Offering is expected to close on or about
This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in
About
Chief Corporate Officer
Tel: (905) 501 7373
pdhillon@cargojet.com
Notice on Forward-Looking Statements:
Certain statements contained herein, including statements related to the completion of the Offering and use of net proceeds of the Offering, constitute “forward-looking statements”. Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as “plans”, “intends”, “anticipates”, “should”, “estimates”, “expects”, “believes”, “indicates”, “targeting”, “suggests” and similar expressions. These forward-looking statements are based on current expectations and entail various risks and uncertainties. Reference should be made to the issuer’s public filings available at www.sedar.com and at www.cargojet.com, including its most recent Annual Information Form filed with the Canadian securities regulators, its most recent Consolidated Financial Statements and Notes thereto and related Management’s Discussion and Analysis (MD&A), and the short form prospectus to be filed in connection with the Offering, for a summary of material risks. These risks are not intended to represent a complete list of the risks that could affect the issuer; however, these risks should be considered carefully. Actual results may materially differ from expectations, if known and unknown risks or uncertainties affect our business, or if our estimates or assumptions prove inaccurate. The forward-looking statements contained herein describe the issuer’s expectations at the date of this news release and, accordingly, are subject to change after such date. The issuer assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason, other than as required by applicable securities laws. In the event the issuer does update any forward-looking statement, no inference should be made that the issuer will make additional updates with respect to that statement, related matters, or any other forward-looking statement. Readers are cautioned not to place undue reliance on these forward-looking statements.
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