Grupo Aeroportuario del Centro Norte(OMAB) - 2024 Q4 - Annual Report

Key Information This section provides an overview of the company's primary risks and forward-looking statements Risk Factors The company faces significant risks from its highly regulated business environment, operational dependencies on air traffic and key customers, and political-economic instability in Mexico Risks Related to the Regulation of Our Business Mexican government regulations heavily constrain the company's business, with price controls on aeronautical fees, recent tariff amendments, and increased concession taxes posing risks to profitability and concession stability - Aeronautical services, which are regulated by the Mexican government, accounted for 60.6% of total revenues in 2024. The government sets maximum allowable rates, limiting the company's flexibility[12] - On October 4, 2023, the Mexican Federal Civil Aviation Agency amended the tariff regulations, changing the maximum rates effective January 1, 2024. This announcement led to a 26% decline in the company's stock price on the Mexican Stock Exchange[13] - Effective January 1, 2024, the Concession Tax paid by airport concessionaires to the federal government was increased from 5% to 9%[17] - The FAA restored Mexico's Category 1 aviation safety rating in September 2023. However, a future downgrade could restrict Mexican airlines from adding new routes to the U.S., potentially impacting passenger traffic, which included 4.5% of passengers on such routes in 2024[30][31][32] - The company's concessions can be terminated by the Mexican government for various reasons, including failure to comply with Master Development Programs or exceeding maximum tariffs. The termination of one concession could trigger the termination of others[39] - The Mexican military has become a significant airport operator, overseeing 20 airports as of 2024, which collectively served 56.2 million passengers, a 4.0% increase from 2023. This poses a competitive risk[45] Risks Related to Our Operations Operational risks are significant, driven by air traffic dependency on external factors, revenue concentration in key airports and airlines, and cybersecurity threats, as evidenced by a 2024 breach - Revenues are highly dependent on air traffic, which is influenced by factors beyond the company's control, including economic conditions, political situations, and fuel prices[71] - In 2024, 79.2% of international passengers traveled on flights to or from the United States, and 87.0% of all passengers were on domestic flights, highlighting the business's dependence on the U.S. and Mexican economies[79] - Operations are highly dependent on Mexico City International Airport, as approximately 33.0% of domestic passengers in 2024 flew to or from this hub[89] - A cybersecurity breach was disclosed on October 18, 2024, involving ransomware that encrypted files and exfiltrated information related to customers, suppliers, and employees. The company did not pay a ransom and states there were no material adverse effects[96][97] Percentage of Aeronautical & Non-Aeronautical Revenues (2024) | Airport / Subsidiary | Percentage of Aeronautical & Non-Aeronautical Revenues (2024) | | :--- | :--- | | Monterrey | 44.5% | | Culiacán | 7.1% | | Ciudad Juárez | 6.5% | | Chihuahua | 6.5% | | Mazatlán | 6.2% | | OMA Logistica | 6.0% | | Acapulco | 3.1% | | San Luis Potosí | 2.8% | | Others | 17.3% | | Total | 100.0% | - The company is dependent on a few key airline customers. In 2024, VivaAerobus, Volaris, and Aeroméxico accounted for 43.3%, 19.1%, and 20.2% of total aeronautical revenues, respectively[116] - Hurricane Otis struck Acapulco in October 2023, causing the airport to suspend commercial travel until November 13, 2023. This led to a 32.7% decrease in passenger traffic in Acapulco in 2024 compared to 2023[140] Risks Related to Mexico The company's performance is intrinsically linked to Mexico's economic and political stability, facing risks from economic downturns, peso volatility, political reforms, and high crime rates impacting travel and security costs - The business is substantially dependent on Mexican economic conditions, as domestic passengers represented 85.7% of traffic volume in 2024[165] - The 2024 elections resulted in the ruling party securing a majority in Congress, enabling significant constitutional reforms. These reforms include modifications to the judicial system and the elimination of autonomous bodies like the antitrust commission (COFECE), which could negatively impact the economy and investor confidence[171][173][174] - The peso has shown significant volatility, depreciating 23% against the U.S. dollar from Dec 31, 2023, to Dec 31, 2024. This affects revenues from international passengers (priced in USD) and the value of USD-denominated liabilities[37][187] - High crime rates in Mexico, including drug trafficking, have led to U.S. travel advisories for states where the company operates, such as Guerrero and Sinaloa. This could decrease passenger traffic and increase security costs[189] - In January 2025, the U.S. government designated several Mexican cartels as Foreign Terrorist Organizations (FTOs), increasing legal and operational risks for entities in jurisdictions where these groups are present[194] Risks Related to Our Shareholders Key shareholder SETA, controlled by VINCI Entities, exerts significant influence through its Series BB shares, holding rights to appoint executives and veto major corporate actions, potentially misaligning with other shareholders' interests - VINCI Entities, through their subsidiary SETA, beneficially own 29.99% of the company's total capital stock[215] - As long as SETA holds at least 7.65% of capital stock as Series BB shares, it retains special rights, including the right to nominate and appoint key directors and officers, such as the CEO. This concentration of power may differ from the interests of other shareholders[217] Risks Related to Our ADSs ADS holders face limitations, including potential dilution from restricted preemptive rights under Mexican law and indirect voting through the depositary, limiting direct participation in corporate governance - U.S. holders of ADSs may not be legally permitted to exercise preemptive rights in future capital increases unless a registration statement is filed with the SEC, which could lead to dilution of their equity interest[219][221] - Holders of ADSs are not entitled to attend shareholders' meetings in person and can only vote by instructing the depositary, which limits their ability to participate directly[223] Forward-Looking Statements This report contains forward-looking statements regarding projections, plans, and future performance. These statements are identifiable by words like "believe," "expect," and "project." They involve inherent risks and uncertainties, and actual results could differ materially due to factors such as changes in concessions, tariff pressures, legal proceedings, economic conditions in Mexico, inflation, exchange rates, and competition - The report includes forward-looking statements concerning financial projections, company plans, regulatory changes, and economic performance[225][229] - Actual results may differ materially from projections due to various factors, including concession terms, tariff regulations, legal outcomes, economic and political conditions, inflation, exchange rates, and competition[227] Information on the Company This section details the company's history, business operations, regulatory environment, organizational structure, and property assets History and Development of the Company Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (GACN) was incorporated in 1998 as part of Mexico's airport privatization program. In 2000, strategic shareholder SETA acquired a 15% stake (Series BB shares) and entered into a Technical Assistance Agreement. The company completed its IPO on the Mexican and U.S. stock exchanges in 2006. Operations are governed by 5-year Master Development Programs (MDPs) submitted to the government; the current 2021-2025 program commits Ps. 16.9 billion to maintenance and improvements, though some investments have been deferred to 2026-2027 following regulatory changes - The company was incorporated in 1998 as part of the Mexican government's program to open airports to private investment[231] - In 2000, strategic partner SETA acquired 15% of the company's capital stock (Series BB shares) and entered into a 15-year Technical Assistance Agreement[233][234] - The company is required to submit a Master Development Program (MDP) every five years. The current program for 2021-2025 commits Ps. 16.9 billion (in Dec 2024 pesos) to maintenance and improvements[237][239] - Due to amendments in tariff regulations in October 2023, the company was authorized to defer certain committed investments from 2024-2025 to 2026-2027[240] Actual Capital Expenditures (Ps. thousands) | Year | Actual Capital Expenditures (Ps. thousands) | | :--- | :--- | | 2020 | 1,401,483 | | 2021 | 1,910,541 | | 2022 | 2,887,287 | | 2023 | 3,216,794 | | 2024 | 3,242,889 | Business Overview The company operates 13 Mexican airports under concessions, with 2024 revenues of Ps. 15.1 billion primarily from regulated aeronautical services and growing non-aeronautical segments, facing competition and relying on key airline customers Our Operations The company operates 13 Mexican airports under 50-year concessions, handling 26.5 million passengers in 2024, with Monterrey as the primary hub and ongoing diversification into logistics, hotels, and industrial parks - The company operates 13 airports in Mexico under 50-year concessions granted in 1998, which are extendable for up to 50 additional years[257] 2024 Value | Metric | 2024 Value | | :--- | :--- | | Total Revenues | Ps. 15,072,956 thousand | | Consolidated Net Income | Ps. 4,936,224 thousand | | Terminal Passengers | 26.5 million | | Passenger Change vs 2023 | -1.2% | - The Monterrey airport is the company's largest, accounting for 51.2% of terminal passenger traffic and 44.5% of the sum of aeronautical and non-aeronautical revenues in 2024[264] - Diversification activities include OMA Carga (bonded warehouses), the Terminal 2 NH Collection Hotel (Mexico City), the Hilton Garden Inn Hotel (Monterrey), and the OMA-VYNMSA industrial park (Monterrey)[257][268][270][271][272] Our Sources of Revenues Revenues are primarily from price-regulated aeronautical services (60.6% in 2024) and unregulated non-aeronautical services (20.4%), with strategic focus on growing the latter through commercial expansion and diversification activities Revenue Stream Breakdown (2024) | Revenue Stream | % of Total Revenues (2024) | % of Aero & Non-Aero Sum (2024) | | :--- | :--- | :--- | | Aeronautical Services | 60.6% | 74.8% | | Non-Aeronautical Services | 20.4% | 25.2% | - Passenger charges are the largest component of aeronautical revenues, representing 87.1% of aeronautical services revenues and 52.8% of total revenues in 2024[281] - The company is strategically focused on growing non-aeronautical revenues by expanding commercial space, renegotiating tenant contracts to include royalty payments, and improving the quality of retail and food offerings[302][304][305] - Revenues from diversification activities, a key part of the non-aeronautical strategy, increased by 25.5% in 2024 compared to 2023, driven by OMA Carga, hotels, and the industrial park[309] Our Airports The company operates 13 airports categorized as metropolitan (Monterrey), tourist (Acapulco, Mazatlán, Zihuatanejo), regional (7 airports), and border (Ciudad Juárez, Reynosa). In 2024, Monterrey was the dominant airport with 51.2% of passenger traffic. Total passenger traffic across all airports decreased slightly by 1.2% to 26.5 million in 2024 from 26.8 million in 2023. Air traffic movements remained stable at approximately 311,616. The company is undertaking significant expansion projects, notably at the Monterrey, Culiacán, and Ciudad Juárez airports, to increase terminal capacity and improve facilities Passenger Traffic by Airport Type (2024) | Airport Type | % of Total Passenger Traffic (2024) | | :--- | :--- | | Metropolitan (Monterrey) | 51.2% | | Tourist | 11.9% | | Border | 10.1% | | Regional | 26.8% | Total Terminal Passengers and Air Traffic Movements | Metric | 2022 | 2023 | 2024 | | :--- | :--- | :--- | :--- | | Total Terminal Passengers (millions) | 23.2 | 26.8 | 26.5 | | Total Air Traffic Movements | 299,102 | 312,711 | 311,616 | - The Monterrey airport served 13.6 million terminal passengers in 2024 and is undergoing a major expansion project expected to increase annual capacity to 15.9 million passengers by mid-2026[334][347] - Passenger traffic at Acapulco airport decreased by 32.4% in 2024 compared to 2023, following the impact of Hurricane Otis in late 2023[358] - In 2024, VivaAerobus, Grupo Aeroméxico, and Volaris were the top three airline customers by passenger volume, collectively accounting for a significant portion of traffic[436] Competition The company's airports face limited direct competition, except for tourist destinations, but a growing threat comes from the Mexican military operating 20 airports and the potential for new government-granted concessions - Tourist airports (Acapulco, Mazatlán, Zihuatanejo) face competition from other destinations in Mexico like Cancún and Los Cabos, as well as international locations in the Caribbean and Florida[445] - The Mexican military has become a major airport operator, overseeing 20 airports that served 56.2 million passengers in 2024, an increase of 4.0% from 2023[448] - Potential new competition exists from government-granted concessions, such as the recently opened airport in Bocoyna, Chihuahua, and the military-managed Aeropuerto Internacional del Norte near Monterrey, which could expand into commercial aviation[451][452] Sustainability and Our Corporate Culture Sustainability is a core value, focusing on environmental management, social responsibility, and corporate governance. The company publishes an annual Sustainability Report in accordance with GRI and SASB standards. It has received numerous awards and certifications, including being part of the Bloomberg Gender-Equality Index, achieving Level 3 Airport Carbon Accreditation for all 13 airports, and being named a Socially Responsible Company for 14 years. All airports hold Environmental Quality Certificates and have achieved ISO 14064-1:2018 certification for GHG emissions reporting - The company's sustainability policy is built on three pillars: environmental management, social responsibility, and corporate governance[453] - In 2025, all 13 airports achieved Level 3 certification of the Airport Carbon Accreditation Program from Airports Council International[461] - The company was included in the Bloomberg Gender-Equality Index in 2022 and 2023 and has been recognized as a Socially Responsible Company for 14 consecutive years[459][462] - All airports have received the Environmental Quality Certificate from Mexico's Federal Office for the Protection of the Environment and obtained ISO 14064-1:2018 certification for greenhouse gas reporting in 2024[466][467] Regulatory Framework The company's operations are governed by Mexican law and 13 concessions, with SICT regulating tariffs and MDPs under a dual-till system. Recent changes include a concession tax increase to 9% and new sustainability disclosure requirements starting 2026 - The principal laws governing operations are the Mexican Airport Law and the regulations thereunder, which establish the framework for airport concessions[471][472] - The Ministry of Infrastructure, Communications and Transportation (SICT) is the primary regulator, with authority over concessions, Master Development Programs, and maximum tariffs[490] - Aeronautical revenues are subject to a "dual-till" price regulation system with a maximum tariff set every five years. The current tariffs are in effect through December 31, 2025[524][527][528] - The concession tax, paid on gross annual revenues from public domain assets, was increased from 5% to 9% effective January 1, 2024[494][495] - Concessions can be revoked for various reasons, including failure to comply with the MDP, exceeding maximum tariffs, or failure to pay the concession tax. Revocation of one concession could lead to the revocation of all others[546][548] - Starting in 2026, the company will be required to disclose sustainability information in accordance with IFRS Sustainability Disclosure Standards (S1 and S2), including obtaining external assurance on these disclosures from 2027 onwards[561][207][208] Organizational Structure Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. is a holding company that operates through numerous wholly-owned or majority-owned subsidiaries. Each of the 13 airports is held by a separate subsidiary in which the company owns 100%. Other key subsidiaries manage administrative services, complementary services (like baggage screening), and diversification projects, including OMA Logística (which holds interests in the industrial park and the Hilton Garden Inn) and the entity operating the NH Collection Hotel at the Mexico City airport - The company is a holding company that conducts its operations through various subsidiaries[579] - Each of the 13 airports is operated by a distinct, 100%-owned subsidiary holding the respective concession[579] - Diversification projects are managed through specific subsidiaries, such as Consorcio Grupo Hotelero T2, S.A. de C.V. (90% owned) for the NH Hotel, and OMA Logística, S.A. de C.V. (100% owned), which in turn holds majority stakes in the entities for the Hilton Garden Inn (85%) and the OMA-VYNMSA Industrial Park (51%)[580] Property, Plant and Equipment All real estate and fixtures at the company's airports are owned by the Mexican government. The company operates these assets under concessions that expire in 2048 but may be extended for up to 50 additional years. Upon expiration, these assets, including any improvements made by the company, will revert to the government. The company maintains comprehensive insurance coverage for its assets against damage from natural disasters, accidents, and terrorism, including a U.S.$500 million policy for third-party damages and a U.S.$150 million policy for asset and infrastructure damage - All real estate and fixtures at the airports are owned by the Mexican government; the company operates them under concessions expiring in 2048[582] - Upon concession expiration, all assets and improvements revert to the Mexican government free of liens[582] - The company maintains comprehensive insurance, including a U.S.$500 million policy for third-party liability and a U.S.$150 million policy for asset damage[583] Operating and Financial Review and Prospects This section provides a detailed analysis of the company's financial performance, operating results by segment, liquidity, capital resources, and critical accounting policies Overview The company's financial performance is driven by regulated aeronautical and unregulated non-aeronautical revenues. In 2024, total revenues grew 4.3% to Ps. 15.1 billion, but net income decreased 1.7% to Ps. 4.9 billion due to rising costs and a higher concession tax - The majority of revenues (60.6% in 2024) are from aeronautical services, which are regulated by maximum tariffs linked to passenger and cargo volume (workload units)[587] - Non-aeronautical revenues, which are not price-regulated, are a strategic growth area and include commercial, diversification, and complementary activities[589] Key Financial and Operational Metrics | Metric | 2022 | 2023 | 2024 | | :--- | :--- | :--- | :--- | | Total terminal passengers (thousands) | 23,220.75 | 26,845.45 | 26,510.50 | | Change in total terminal passengers | 28.8% | 15.6% | (1.2)% | | Aeronautical revenues (Ps. thousands) | 7,055,543 | 8,931,657 | 9,136,885 | | Non-aeronautical revenues (Ps. thousands) | 2,229,802 | 2,627,423 | 3,075,881 | - The peso depreciated approximately 23% against the U.S. dollar from Dec 31, 2023 to Dec 31, 2024, affecting U.S. dollar-denominated revenues and liabilities[605] - The concession tax rate increased from 5% to 9% of gross annual revenues starting in 2024[636][637] Operating Results by Segment In 2024, Monterrey airport remained the primary revenue and operating income driver, while tourist airports showed mixed results, and diversification segments like hotels and industrial parks demonstrated strong growth Operating Results by Segment (2024) | Segment (2024) | Total Revenues (Ps. thousands) | Operating Income (Ps. thousands) | Operating Margin | | :--- | :--- | :--- | :--- | | Monterrey Airport | 6,850,633 | 1,502,974 | 21.9% | | Acapulco Airport | 274,171 | 62,311 | 22.7% | | Mazatlán Airport | 889,434 | 218,487 | 24.6% | | Culiacán Airport | 1,214,729 | 239,274 | 19.7% | | Ciudad Juárez Airport | 1,078,725 | 208,856 | 19.4% | | Terminal 2 NH Hotel | 329,410 | 94,758 | 28.8% | | Hilton Garden Inn Hotel | 135,650 | 45,296 | 33.4% | | OMA-Vynmsa Park | 153,095 | 78,434 | 51.2% | Results of Operations for the Year Ended December 31, 2024, Compared to the Year Ended December 31, 2023. In 2024, total revenues increased by 4.3% to Ps. 15.1 billion, driven by a 17.1% rise in non-aeronautical revenues, while aeronautical revenues grew by a modest 2.3%. Despite revenue growth, operating income was nearly flat at Ps. 8.1 billion (a 0.2% increase) due to a 9.4% rise in operating costs, notably an 81.8% surge in concession taxes from the rate hike. Consequently, consolidated net income declined by 1.7% to Ps. 4.9 billion. The operating margin contracted from 55.8% to 53.6% Financial Performance Comparison (2023 vs 2024) | Metric | 2023 (Ps. thousands) | 2024 (Ps. thousands) | % Change | | :--- | :--- | :--- | :--- | | Total revenues | 14,457,080 | 15,072,956 | 4.3% | | Aeronautical services | 8,931,657 | 9,136,885 | 2.3% | | Non-aeronautical services | 2,627,423 | 3,075,881 | 17.1% | | Total operating costs | 6,390,171 | 6,989,744 | 9.4% | | Income from operations | 8,066,909 | 8,083,212 | 0.2% | | Consolidated net income | 5,020,426 | 4,936,224 | (1.7)% | - The increase in total revenues was primarily driven by a 17.1% growth in non-aeronautical revenues, reflecting strong performance in commercial and diversification activities[662] - Operating costs rose significantly, with concession taxes increasing by 81.8% due to a rate hike from 5% to 9% and higher revenues[689] - Net income decreased by 1.7% to Ps. 4,936.2 million, and the operating margin fell to 53.6% from 55.8% in the prior year[691][716] Results of Operations for the Year Ended December 31, 2023, Compared to the Year Ended December 31, 2022. In 2023, the company saw strong growth, with total revenues increasing by 21.1% to Ps. 14.5 billion. This was fueled by a 26.6% rise in aeronautical revenues and a 17.8% increase in non-aeronautical revenues, driven by a post-pandemic recovery in passenger traffic. Operating income surged by 33.0% to Ps. 8.1 billion, and the operating margin expanded significantly from 47.1% to 55.8%. Consolidated net income grew by 28.2% to Ps. 5.0 billion Financial Performance Comparison (2022 vs 2023) | Metric | 2022 (Ps. thousands) | 2023 (Ps. thousands) | % Change | | :--- | :--- | :--- | :--- | | Total revenues | 11,934,768 | 14,457,080 | 21.1% | | Aeronautical services | 7,055,543 | 8,931,657 | 26.6% | | Non-aeronautical services | 2,229,802 | 2,627,423 | 17.8% | | Income from operations | 6,064,486 | 8,066,909 | 33.0% | | Consolidated net income | 3,917,305 | 5,020,426 | 28.2% | - The sum of aeronautical and non-aeronautical revenues increased by 24.5% compared to 2022, reflecting a strong recovery in air travel demand[717] - Operating margin improved to 55.8% in 2023 from 47.1% in 2022, demonstrating enhanced profitability[749] - Net income increased by 28.2% to Ps. 5,020.4 million, with earnings per ADS reaching Ps. 103.8272[774] Liquidity and Capital Resources The company primarily funds its operations and capital expenditures through cash flow from operations and debt. As of December 31, 2024, cash and cash equivalents stood at Ps. 1.66 billion. In 2024, cash flow from operations was Ps. 6.2 billion, while Ps. 2.5 billion was used for investing activities and Ps. 4.7 billion for financing, including Ps. 4.2 billion in dividend payments. Total indebtedness increased to Ps. 11.3 billion by year-end 2024. The company has a share repurchase program with a reserve of Ps. 1.5 billion, though no shares were repurchased in 2024 - The company funds liquidity needs through cash flows from operations and debt financing[775] Cash Flow Summary (Ps. thousands) | Metric (Year-end) | 2022 (Ps. thousands) | 2023 (Ps. thousands) | 2024 (Ps. thousands) | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 3,336,420 | 2,576,256 | 1,656,365 | | Cash Flow from Operations | 4,985,336 | 6,334,747 | 6,196,669 | | Cash Flow used in Investing | (2,754,759) | (2,791,722) | (2,509,854) | | Cash Flow used in Financing | (4,875,774) | (4,302,392) | (4,664,030) | - Total indebtedness rose from Ps. 10.7 billion at year-end 2023 to Ps. 11.3 billion at year-end 2024[803] - The company has a share repurchase program with a Ps. 1.5 billion reserve authorized for 2025. No shares were repurchased in 2022, 2023, or 2024[816][817] Critical Accounting Policies and Estimates The company's financial statements are prepared in accordance with IFRS, which requires management to make critical judgments and estimates. These estimates, based on historical experience and other relevant factors, are crucial for valuing certain items and making required disclosures. Key areas involving significant judgment include impairment of long-lived assets, defined benefit obligations, and provisions for major maintenance. Actual results may differ from these estimates - The preparation of financial statements under IFRS requires management to make significant estimates and assumptions regarding the carrying amounts of assets and liabilities[818][1338] - Key sources of estimation uncertainty include the impairment of long-lived assets (like airport concessions), the valuation of defined benefit obligations for employees, and the provision for major maintenance[1342] Directors, Senior Management and Employees This section outlines the composition and responsibilities of the Board of Directors, executive officers, compensation policies, supporting committees, and employee information Directors The Board of Directors consists of 11 members, with at least 25% required to be independent. Key shareholder SETA (controlled by VINCI) has the right to elect three directors. The current Chairman is Nicolas Notebaert, CEO of VINCI Concessions. The board includes five independent directors. Recent changes in 2024 included the appointment of Guillaume Dubois, Katia Eschenbach, and Regina García-Cuéllar. The board is responsible for major strategic decisions, financial oversight, and ensuring compliance with the company's Master Development Programs - The Board of Directors currently consists of 11 members, and at least 25% must be independent as per Mexican Securities Law[819] - Shareholders holding 10% of Series B shares can designate one director, while holders of Series BB shares (SETA) are entitled to elect three directors[820] - Nicolas Notebaert, CEO of VINCI Concessions, serves as the Chairman of the Board[831][832] Executive Officers The company's executive team is led by Chief Executive Officer Ricardo Dueñas Espriu. Key shareholder SETA has the right to nominate the CEO and appoint the Chief Financial Officer, Chief Operating Officer, and Chief Commercial Officer. The current executive team possesses extensive experience in the airport, infrastructure, and finance sectors - Key shareholder SETA is entitled to nominate the CEO and appoint the CFO, COO, and Commercial Director[861] Executive Officers | Name | Position | | :--- | :--- | | Ricardo Dueñas Espriu | Chief Executive Officer | | Ruffo Pérez Pliego del Castillo | Chief Financial Officer | | Adriana Díaz Galindo | General Counsel | | Enrique Navarro Manjarrez | Chief Operating Officer | | Alvaro Leite | Chief Commercial Officer | | Yann Le Bihan | Chief Technical Officer | Compensation of Directors and Executive Officers In 2024, the aggregate compensation for the company's 24 officers was Ps. 103.5 million. The company does not have a stock option plan and does not provide termination benefits beyond what is required by Mexican labor law. In October 2023, the Board adopted a compensation recovery (clawback) policy in compliance with SEC and Nasdaq rules, allowing for the recovery of erroneously awarded incentive-based compensation in the event of an accounting restatement - The aggregate compensation for 24 officers in 2024 was Ps. 103,531 thousand[872] - The company does not have a stock option plan or provide special termination benefits to its directors or executive officers[873] - A compensation recovery (clawback) policy was adopted on October 26, 2023, in line with SEC requirements, to recover incentive-based pay following a required accounting restatement[875] Board of Directors' Supporting Committees The Board is supported by two key committees composed exclusively of independent directors: the Audit Committee and the Corporate Practices, Finance, Planning and Sustainability Committee. The Audit Committee oversees financial reporting, internal controls, and the external auditor. The Corporate Practices Committee handles strategic planning, investment policies, risk evaluation, and related-party transactions. Katia Eschenbach chairs the Audit Committee, and Luis Solorzano Aizpuru chairs the Corporate Practices Committee - The Board has two main supporting committees: the Audit Committee and the Corporate Practices, Finance, Planning and Sustainability Committee[877] - The Audit Committee is responsible for overseeing external auditors, financial statements, and internal controls. Its current chairman is Katia Eschenbach[882][884] - The Corporate Practices, Finance, Planning and Sustainability Committee provides opinions on strategic plans, investment policies, risk factors, and related-party transactions. Its current chairman is Luis Solorzano Aizpuru[885][887] Employees As of December 31, 2024, the company had 1,326 employees, a 4.7% increase from the previous year, mainly due to expanded operations at airports and hotels. Approximately 44.7% of the workforce is unionized. The company maintains a savings plan for all employees, matching their contributions up to 13% of their pre-tax salaries. The company has been recognized for its commitment to gender equality, being included in the Bloomberg Gender-Equality Index Employee Statistics | Year-End | Total Employees | % Unionized | | :--- | :--- | :--- | | 2022 | 1,255 | N/A | | 2023 | 1,267 | N/A | | 2024 | 1,326 | 44.7% | - Unionized employees are members of the Mexican National Union of Airport and Auxiliary Services Workers. Wages are renegotiated annually, and other employment terms every two years[894] - The company offers a savings plan where it matches employee contributions of up to 13% of pre-tax salary. In 2024, the company's contributions totaled Ps. 57.4 million[896] Major Shareholders and Related-Party Transactions This section details the company's major shareholders, their ownership stakes, and significant related-party transactions Major Shareholders As of April 25, 2024, the VINCI Entities are the beneficial owners of 29.99% of the company's total capital stock through their subsidiaries, CONCESSOC (15.2%) and SETA (14.8%). SETA's holding includes all Series BB shares, which grant it special rights such as appointing key executives and board members, and veto power over significant corporate actions, as long as its Series BB ownership remains above 7.65%. The public holds 70.0% of the capital stock - On December 7, 2022, VINCI Entities completed the acquisition of a 29.99% stake in the company through its subsidiary CONCESSOC[905][907] Shareholder Breakdown | Shareholder | % of Total Capital Stock | | :--- | :--- | | SETA (VINCI) | 14.8% | | CONCESSOC (VINCI) | 15.2% | | Public | 70.0% | - SETA holds all Series BB shares (12.9% of total capital), which grant it special rights, including appointing key management and three directors, and veto power over major corporate decisions[911] Related-Party Transactions The company engages in significant related-party transactions, primarily with its strategic shareholder SETA. Under a Technical Assistance Agreement, SETA provides management and consulting services in exchange for a fee, which amounted to Ps. 235.5 million in 2024. This fee is calculated as the greater of a fixed amount or a percentage of EBITDA. Other related-party transactions in 2024 included Ps. 5.7 million for services with VINCI and its affiliates, and transactions with partners in its hotel and industrial park ventures - The company has a Technical Assistance Agreement with SETA, which provides management and consulting services. The agreement was extended and will automatically renew as long as SETA holds at least 7.65% of the company's shares[916] Related-Party Transactions (2024) | Transaction with Related Party | 2024 Amount (Ps. thousands) | | :--- | :--- | | Technical assistance fees with SETA | 235,499 | | Administrative services with hotel/park partners | 66,412 | | Development services with VYNMSA | 311,317 | | Services with VINCI and affiliates | 5,705 | Financial Information This section covers the company's legal proceedings, dividend policy, and capital stock reimbursements Legal Proceedings The company is involved in several legal proceedings, primarily concerning disputed land ownership at its Ciudad Juárez, Monterrey, and Durango airports, and property tax claims from various municipalities. A significant land dispute at the Monterrey airport (the Banorte case) concluded favorably in December 2023. However, other claims remain pending. The company believes that potential liabilities from these cases are unlikely to have a material adverse effect, as indemnification from the Mexican government may be available for certain claims, and no provisions have been recorded - A long-standing legal proceeding to reclaim 240 hectares of land at the Ciudad Juárez airport is still pending. An adverse ruling could lead to the termination of the concession for that airport[924][930] - A major land ownership dispute at the Monterrey airport involving Banorte concluded on December 8, 2023, with a final resolution in favor of the airport[931][936] - The company faces property tax claims from municipalities including Acapulco and Chihuahua. A claim from Culiacán was resolved in the company's favor in January 2024[943][944][945][946] Dividends and Capital Stock Reimbursements The company's dividend policy includes a fixed annual component of Ps. 325 million and a variable component based on available funds. Dividend payments are subject to shareholder approval and legal reserve requirements. In 2024, the company paid aggregate dividends of Ps. 4.22 billion. For 2025, a cash dividend of Ps. 4.5 billion has been approved, to be paid in two installments. Dividends paid to non-resident holders are subject to a 10% Mexican withholding tax - Mexican law requires 5% of net income to be allocated to a legal reserve fund until it reaches 20% of capital stock before dividends can be paid[956] - The dividend policy has a fixed component of Ps. 325 million per year and a variable component, subject to shareholder approval and financial position[962] Aggregate Dividends Paid (Ps. thousands) | Year | Aggregate Dividends Paid (Ps. thousands) | | :--- | :--- | | 2022 | 6,615,798 | | 2023 | 3,738,054 | | 2024 | 4,220,653 | - A cash dividend of Ps. 4.5 billion was approved for 2025, to be paid in two installments by May 31 and November 30, 2025[966] The Offer and Listing This section provides information on the company's share price history and trading details on Mexican stock exchanges Share Price History The company's American Depositary Shares (ADSs) are listed on the NASDAQ under the ticker symbol "OMAB," and its common shares are listed on the Mexican Stock Exchange (Bolsa Mexicana de Valores) under the symbol "OMA" - The company's ADSs are listed on NASDAQ under the symbol "OMAB"[968] - The company's common shares are listed on the Mexican Stock Exchange under the symbol "OMA"[968] Trading on the Mexican Stock Exchange and Bolsa Institucional de Valores Trading in Mexico occurs on two exchanges, the Bolsa Mexicana de Valores and the Bolsa Institucional de Valores, both located in Mexico City. Trading is automated and operates from 8:30 a.m. to 3:00 p.m. Mexico City time. Settlement is completed two business days after a transaction, and most securities are held on deposit with Indeval, a central securities depositary - Trading in Mexico occurs on the Bolsa Mexicana de Valores and the Bolsa Institucional de Valores[968] - Settlement is effected two business days after a transaction, with securities held at the Indeval central depositary[970] Additional Information This section details the company's bylaws, material contracts, exchange controls, and taxation policies relevant to shareholders Bylaws The company's bylaws, aligned with Mexican Securities Law, define its corporate governance, including board composition, Series BB shareholder rights, minority protections, and anti-takeover provisions requiring mandatory tender offers for control changes - The Board of Directors must consist of at least 11 members, with at least 25% being independent[978] - Holders of Series BB shares have the right to elect three directors and veto certain major corporate actions, including dividend payments and bylaw amendments, as long as they hold at least 7.65% of the capital stock[986][1008] - Minority shareholders with at least 10% of capital stock can appoint one director and call a shareholders' meeting[999][1018] - Foreign persons may not own more than 49% of the capital stock of an airport concession holder without authorization from the Mexican Commission of Foreign Investments[993] - An intended acquisition of control requires a mandatory public tender offer for 100% of the company's outstanding capital stock, subject to regulatory approval[1016] Material Contracts The company's material contracts include the 13 airport concessions granted by the Ministry of Infrastructure, Communications and Transportation, which are fundamental to its operations. Additionally, the Participation Agreement and the Technical Assistance Agreement with its strategic shareholder, SETA, are key contracts governing their relationship and the provision of management and consulting services - The company's primary material contracts are the 13 airport concessions granted by the Mexican government[1060] - A Technical Assistance Agreement with SETA governs the provision of management and consulting services[1061] Exchange Controls Mexico has maintained a free market for foreign exchange since 1991, allowing the peso to float freely against the U.S. dollar since December 1994. However, there is no guarantee that the government will maintain these policies in the future - Mexico has a free-floating exchange rate for the peso against the U.S. dollar, but this policy is subject to change by the government[1063] Taxation This section outlines U.S. and Mexican federal income tax consequences for U.S. holders, including a 10% Mexican withholding tax on dividends and certain capital gains, with potential foreign tax credits subject to limitations - Dividends paid to non-Mexican holders are subject to a 10% Mexican withholding tax[1070] - Gains on the sale of shares through the Mexican Stock Exchange by a non-Mexican holder not resident in a treaty country are subject to a 10% withholding tax. Residents of treaty countries may be exempt[1078][1079] - For U.S. holders, dividends are generally taxable as ordinary income but may qualify for preferential rates if they are "qualified dividends." The company believes it was not a PFIC for 2023 and 2024[1073][1074] - U.S. holders may be able to claim a foreign tax credit for Mexican withholding taxes, but this is subject to complex rules and limitations[1076] Quantitative and Qualitative Disclosures About Market Risk This section discusses the company's exposure to market risks, specifically foreign currency exchange rate risk and interest rate risk Market Risk The company is exposed to two primary market risks: foreign currency exchange rate risk and interest rate risk. Exchange rate risk arises from the U.S. dollar-denominated revenues from international passengers and U.S. dollar cash balances, which are affected by peso-dollar fluctuations. Interest rate risk stems from its long-term debt, of which 31.2% had variable interest rates tied to the 28-day TIIE as of year-end 2024. A hypothetical 10% adverse change in the TIIE rate would have increased 2024 financing expenses by approximately Ps. 38.7 million - The principal exchange rate risk is the fluctuation of the Mexican peso against the U.S. dollar, affecting international passenger revenues which are linked to the dollar[1094] - As of December 31, 2024, 31.2% of the company's long-term debt carried a variable interest rate indexed to the 28-day TIIE, exposing it to interest rate risk[1096] - A hypothetical 10% adverse change in the TIIE rate would have increased financing expenses by an estimated Ps. 38.7 million for 2024[1096] Controls and Procedures This section details the company's disclosure controls, internal control over financial reporting, and the independent auditor's opinion Controls and Procedures As of December 31, 2024, management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective in ensuring timely and accurate reporting. Management also assessed its internal control over financial reporting, based on the COSO 2013 framework, and concluded that it was effective. The independent registered public accounting firm, Galaz, Yamazaki, Ruiz Urquiza, S.C., issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting. No material changes to internal controls were reported during 2024 - Management concluded that as of December 31, 2024, the company's disclosure controls and procedures were effective at a reasonable assurance level[1108] - Management assessed internal control over financial reporting using the COSO 2013 framework and concluded it was effective as of December 31, 2024[1112][1113] - The independent registered public accounting firm issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting as of December 31, 2024[1115] - There were no changes in internal control over financial reporting during 2024 that materially affected, or are reasonably likely to materially affect, internal controls[1122] Corporate Governance and Other Disclosures This section covers the company's corporate governance practices, including audit committee expertise, code of ethics, principal accountant fees, and cybersecurity measures Audit Committee Financial Expert The Board of Directors has determined that Ms. Katia Eschenbach, a member of the Audit Committee, qualifies as an "audit committee financial expert" and is independent as defined by SEC and NASDAQ rules - The Board of Directors has identified Ms. Katia Eschenbach as the "audit committee financial expert"[1123] Code of Ethics The company has adopted a code of ethics that applies to all directors, officers, and employees. The code is available on the company's website, and any amendments or waivers applicable to senior financial officers will be disclosed there - A code of ethics applicable to all directors, officers, and employees has been adopted and is available on the company's website[1124] Principal Accountant Fees and Services The company's independent auditor is Galaz, Yamazaki, Ruiz Urquiza, S.C. (Deloitte). For the fiscal year 2024, total audit fees were Ps. 16.0 million, compared to Ps. 15.5 million in 2023. No other fees were billed for non-audit services. All engagements with the independent auditor are approved on a case-by-case basis by the Audit Committee Auditor Fees (Ps. thousands) | Fee Type | 2023 (Ps. thousands) | 2024 (Ps. thousands) | | :--- | :--- | :--- | | Audit fees | 15,532 | 15,973 | | All other fees | — | — | | Total fees | 15,532 | 15,973 | - The Audit Committee approves all audit and non-audit services provided by the independent auditors on a case-by-case basis[1127] Corporate Governance As a foreign private issuer, the company's corporate governance adheres to Mexican law, differing from NASDAQ standards in areas like director independence, executive sessions, and committee compositions and duties - The company's corporate governance practices are governed by Mexican law and differ from NASDAQ standards for U.S. companies[1131] - Under Mexican law, 25% of the board must be independent, whereas NASDAQ requires a majority for U.S. companies[1133] - Unlike NASDAQ rules, Mexican law does not require independent directors to meet regularly in executive sessions[1134] - The duties and composition of the Audit and Corporate Practices committees are defined by the Mexican Securities Law[1134][1135] Cybersecurity The company maintains a comprehensive cybersecurity risk management process based on the NIST framework, overseen by an Information Security Officer who reports to the IT Manager and ultimately the CFO. The process includes vulnerability analysis, threat monitoring via a SOC, and regular third-party penetration testing. A cybersecurity committee, including the CEO and CFO, convenes during incidents. The Audit Committee of the Board of Directors has primary oversight. A ransomware incident was detected on October 18, 2024, which led to data exfiltration but did not have a material adverse effect on operations or finances - The company's cybersecurity risk management follows the NIST Cybersecurity Framework and includes regular vulnerability assessments and penetration testing[1141] - A cybersecurity breach involving ransomware was detected on October 18, 2024. Information was exfiltrated, but the incident has not had a material adverse effect on operations or financial condition[1143][1144] - Cybersecurity governance involves an Information Security Officer, a management-level cybersecurity committee, and oversight by the Audit Committee of the Board of Directors[1145][1146][1147] Financial Statements This section presents the company's consolidated financial statements, including statements of financial position, income, changes in shareholders' equity, and cash flows Consolidated Statements of Financial Position As of December 31, 2024, total assets were Ps. 27.2 billion, an increase from Ps. 25.2 billion in 2023, primarily due to a rise in investment in airport concessions. Total liabilities increased to Ps. 16.7 billion from Ps. 15.4 billion, mainly driven by higher long-term debt and concession taxes payable. Total shareholders' equity grew to Ps. 10.5 billion from Ps. 9.8 billion in the prior year Consolidated Statements of Financial Position (Ps. thousands) | (Ps. thousands) | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | :--- | | Total Assets | 27,233,060 | 25,237,595 | 23,069,978 | | Investment in airport concessions, net | 18,715,808 | 16,421,304 | 13,940,366 | | Cash and cash equivalents | 1,656,365 | 2,576,256 | 3,336,420 | | Total Liabilities | 16,688,823 | 15,399,093 | 14,515,358 | | Long-term debt | 10,681,880 | 10,676,708 | 7,484,336 | | Total Shareholders' Equity | 10,544,237 | 9,838,502 | 8,554,620 | Consolidated Statements of Income and Other Comprehensive Income For the year ended December 31, 2024, the company reported total revenues of Ps. 15.1 billion, a 4.3% increase from 2023. Operating income remained stable at Ps. 8.1 billion. After accounting for interest expenses and income taxes, the consolidated net income for the year was Ps. 4.94 billion, a slight decrease of 1.7% from the Ps. 5.02 billion reported in 2023. Basic and diluted earnings per share were Ps. 12.76 Consolidated Statements of Income (Ps. thousands) | (Ps. thousands) | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Total revenues | 15,072,956 | 14,457,080 | 11,934,768 | | Operating income | 8,083,212 | 8,066,909 | 6,064,486 | | Income before income taxes | 7,069,238 | 7,059,868 | 5,292,825 | | Consolidated net income | 4,936,224 | 5,020,426 | 3,917,305 | | Basic and diluted EPS (Ps.) | 12.76332 | 12.97835 | 10.10169 | Consolidated Statements of Changes in Shareholders' Equity Shareholders' equity increased from Ps. 9.84 billion at the end of 2023 to Ps. 10.54 billion at the end of 2024. The increase was primarily driven by the consolidated net income of Ps. 4.93 billion, which was partially offset by dividend payments totaling Ps. 4.22 billion during the year. The reserve for share repurchases remained unchanged at Ps. 1.5 billion - Total shareholders' equity increased from Ps. 9,838.5 million at year-end 2023 to Ps. 10,544.2 million at year-end 2024[1179] - The change in equity was driven by a net income of Ps. 4,936.2 million, offset by dividend payments of Ps. 4,220.7 million[1179] Consolidated Statements of Cash Flows For the year ended December 31, 2024, net cash from operating activities was Ps. 6.20 billion. Net cash used in investing activities was Ps. 2.51 billion, primarily for improvements to concession assets. Net cash used in financing activities was Ps. 4.66 billion, largely due to Ps. 4.22 billion in dividend payments and Ps. 1.10 billion in interest payments, partially offset by Ps. 600 million in new short-term debt. The company ended the year with a cash and cash equivalents balance of Ps. 1.66 billion, a decrease from Ps. 2.58 billion at the end of 2023 Consolidated Statements of Cash Flows (Ps. thousands) | (Ps. thousands) | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Net cash from operating activities | 6,196,669 | 6,334,747 | 4,985,336 | | Net cash used in investing activities | (2,509,854) | (2,791,722) | (2,754,759) | | Net cash used in financing activities | (4,664,030) | (4,302,392) | (4,875,774) | | Net decrease in cash | (977,215) | (759,367) | (2,645,197) | | Cash at end of year | 1,656,365 | 2,576,256 | 3,336,420 |