Cargojet Posts Record C$286.5 Million Revenue in Third Quarter
Key Facts
Cargojet posted revenue of C$286.5 million in the third quarter of 2026, compared with C$219.9 million in the same period a year earlier, while adjusted earnings per share rose to C$1.21 from C$0.32. The company said in its report that revenue and adjusted EBITDA reached record third-quarter levels. Adjusted EBITDA was C$90.2 million, versus C$70.4 million a year earlier. But its margin fell to 31.5% from 32.0%, putting earnings growth in the context of margin pressure. These figures are in Canadian dollars.
Net income rose to C$19.1 million in the third quarter from C$8.8 million in the corresponding period of 2025. Revenue growth came mainly from air cargo services, which generated C$269.7 million, compared with C$202.6 million a year earlier. By contrast, revenue from other sources declined to C$16.8 million from C$17.3 million. The figures show a divergence among revenue components, with the increase concentrated in air cargo. Total revenue was C$286.5 million, versus C$219.9 million.
Within the operating revenue mix, domestic network, aircraft services and charter revenue totaled C$233.6 million, up from C$187.1 million in the third quarter of 2025. Fuel surcharges and other revenue also increased to C$56.0 million from C$40.7 million. Average domestic network revenue per operating day rose to C$2.27 million from C$2.03 million. Flight hours increased to 18,405, compared with 15,861 a year earlier. The company provides dedicated air cargo services and aircraft services, as well as international charter flights to major North American cities.
Adjusted earnings growth came alongside a decline in free cash flow to C$62.1 million in the third quarter of 2026 from C$152.4 million in the corresponding period a year earlier. Cargojet said fuel cost pass-through mechanisms limited the impact of higher fuel prices on adjusted EBITDA. It added, however, that these mechanisms contributed to a contraction of about 190 basis points in the adjusted earnings margin. Adjusted earnings therefore rose year over year, while the margin narrowed and free cash flow fell compared with a year earlier. The company did not provide a further numerical explanation for the decline in free cash flow in the available materials.
On leverage, the company said its net debt to adjusted EBITDA ratio fell to 2.5 times. That is at the upper end of its long-term target range of 1.5 to 2.5 times. It also said its new collective agreement with pilots took effect in the third quarter, retaining the no-strike and no-lockout provision in the previous agreement. The agreement began on July 1, 2026, and runs through June 30, 2031. The company noted potential pressure from macroeconomic factors and higher post-agreement wages.
The company is heading into the fourth-quarter peak season, when demand for its domestic network services typically reaches its high point alongside increased retail activity during the holiday season. Cargojet said it expects strong revenue and adjusted EBITDA performance during the peak season. It also announced the renewal of its share repurchase program, allowing it to buy back up to 1,400,000 shares, beginning November 16, 2026, and ending November 15, 2027. During the nine months ended September 30, 2026, the company purchased and canceled 198,139 shares at a total cost of C$16.4 million. It scheduled a call to discuss third-quarter results for November 12, 2026, at 8:30 a.m. Eastern Time.