Cargojet Inc.

This conference is being recorded. Cette conférence est enregistrée. All participants, please stand by. Your conference is ready to begin. Good morning, ladies and gentlemen. Welcome to the cargo jet conference call. I would now like to turn the meeting over to Ms. Pauline Dillon.

Please go ahead, Ms. Dillon. Thank you, Operator. Good morning, everyone, and thank you for joining us on the call today. With me on the call today are A.J. Vermani, our President and Chief Executive Officer, Jamie Porteus, our Chief Strategy Officer, Scott Calver, our Chief Financial Officer, Sanjeev Mani, our Vice President of Finance. After opening remarks about the quarter, we will open the call for questions. I would like to point out that certain statements made on this call, such as those relating to our forecasted revenues, costs, and strategic plans, are forward-looking and within the meaning of applicable securities laws. This call also includes references to non-GAAP measures like adjusted EBITDA, adjusted earnings per share, and return on invested capital. Please refer to our most recent press release and MD&A for important assumptions and cautionary statements relating to forward-looking information and for reconciliations of non-GAAP measures to GAAP income. I'll now turn over the call to A.J.,

Thank you, Pauline. Good morning, everyone, and thank you for joining us for our fourth quarter earnings call. I want to begin by sharing a few thoughts on the economic climate. Although the central bank started to raise interest rates last March, the impact on consumer behavior is just beginning to be felt. We saw this in our December peak period, which was slower than last year. We expect the consumer to remain cautious and retail sales to remain subdued in the near future. However, I want to put cargo jets last three years in context. Our adjusted EBITDA for the year ending 2019 was $156 million, and we ended 22 with EBITDA of $330 million. This is an increase of 111% over three years. There is a perception that all of the growth was COVID driven. Let me remind you that these three years, we have brought in a major strategic partner, DHL, and diversified our business into ACMI as a strong pillar. This new revenue improves the mix between our flagship domestic business versus the lines of business, charter. Although cyclical, continues to be an important and opportunist business that helps us utilize our assets when they're not supporting our domestic overnight network. We have also been prudent in managing cash flow and capital expenditures. Given the nature of our business, we have always structured our capital expenditures and their plans with flexibility and optionality. With the changing economic conditions at the present time, we are exercising that very flexibility by deferring capital expenditures previously announced by approximately $400 million. This will involve, the major portion of this will involve not two, but four triple sevens. So we will have a reduction of four triple sevens from the eight. Scott will have further comments on this particular matter. I also want to highlight that while we have done that, we have maintained our flexibility with MROs for conversion slots, which are premium, and we will hold on to that and defer them by 12 to 18 months or two years if we need to, to see the economic climate, what kind of conversions it would want. Scott will provide more color on this, as I mentioned. As an entrepreneurial company, we have always been focused on cost management. As the pandemic hit, we were focused on meeting the demand and deployed resources and added costs to successfully manage the opportunity. At that time, our simple principle was we need to handle the volume, which was overflowing, and it had to be done at any cost. Now we find ourselves dealing with a different set of economic environments and have shifted back to our basic routine of focusing on every dollar we spend. Every dollar we're spending is under review. As such, we have several initiatives underway that will reduce costs and allow us to remain focused on our goal of maintaining historical markets. We're also focused on right-sizing of our network, our fleet, and other human resources to match the demand out there. At a macro level, e-commerce has now become part of normal consumer behavior. A lot of more essential goods are being ordered online versus selective online buying occurred prior to COVID. The job market continues to be resilient, and inflation is starting to show some signs of weakness. It's also worth noting that our business is underwritten by some of the world's largest logistics brands, such as Purolator, Canipos, UPS, Amazon, DHL, TFI International, and Lauer Health Group. There's an old saying, you're as good as the company you keep. These are resilient businesses and will continue to be the backbone of our global trade and commerce. In the Fourth quarter, we announced the renewal of UPS contract in mid-January. We announced the Canada Post and payroll later contract extension in January as well. These contracts are long-term. They were expiring in March 2025, but having heard of our investment partners, we purposely extended These contracts, 2029 and 2031, locking up these customers and ensuring that there is no competitive impact on our business. This also solidifies CargoJet's leadership position in the Canadian overnight air cargo market. We have now extended all of our strategic customers. We have managed two down cycles before when CargoJet was a much smaller organization with limited options to manage costs. Today, CargoJet is much larger, much more optionality in managing the economic cycle. You may recall we started to prepare for the cycle back in January 2021 when we solidified our liquidity and our balance sheet by raising $365 million in equity. We remain confident in our long-term growth strategy and expect to resume our capital expenditures and growth initiatives as we come out of the economic cycles. Just as our team demonstrated resilience in managing rapid growth driven by pandemic, we are equally capable of managing the down cycle with similar rigor and discipline. One of the biggest lessons we have always learned in our business is It's never as rosy as it seems, and it's never as gloomy as it appears. Therefore, we will stay focused on our long-term mission of creating shareholder value and managing our short-term volatility. I will now pass on the call to our CFO, Scott Caliver, for an update on business. Thank you.