Corporación América Airports (CAAP) Q2 2025 Earnings Call August 21, 2025 10:00 AM ET Company ParticipantsPatricio Esnaola - Head - IRMartín Antranik Eurnekian - CEO & DirectorJorge Arruda - CFOGuilherme Mendes - Executive Director - Equity ResearchOperatorGood morning, and welcome to the Corporacion America Airports Second Quarter twenty twenty five Conference Call. A slide presentation accompanies today's webcast and is available in the Investors section of the company's website. As a reminder, all partic ...

塞上暑运热潮中，变化悄然发生。全国乃至世界旅客不满足于"从起点到终点"的基础保障，而是对效 率、便捷与舒适有了更高追求。作为"塞上空港"的门户，银川机场始终锚定旅客需求，从行程规划到抵 离终端，全流程打磨服务细节，让每一段旅途都充满"掌控感"与"舒适感"。 许多旅客以前赶飞机总怕来不及，而现在心里踏实多了。这是旅客们对银川机场的当下感受。为破 解"卡点焦虑"，机场完成20台自助值机设备迭代，交互响应更快、操作更流畅；新增6台自助托运设 备，每件行李处理时效缩短15秒，让"自助出行"更轻松。 航显系统作为信息"第一窗口"全面焕新：核心信息3秒触达，界面分区清晰，异常航班信息突出显示， 旅客一眼就能捕捉动态。安检通道的"空间重构"更显用心：双通道拓宽至8米，高峰容量增加30%；延 长前传台、增设行李摆放点，让旅客预处理平均时间缩短。如以前排队15分钟，现在最多8分钟就能过 检，智能系统还会播报等待人数和预计时间。此外，行李系统判图时长缩减20秒，航班截载时间从35分 钟缩短至30分钟——这5分钟正是全流程效率升级的生动注脚与真切提高。 清晰的指引是顺畅出行的"指南针"。银川机场以旅客全流程路线为核心，重构标识导视 ...

Core Insights - Guangzhou Baiyun Airport has seen a significant increase in flight and passenger numbers during the summer season, with 39,000 flights and 5.762 million passengers recorded from July 1 to July 25, representing a year-on-year growth of 7.76% and 7.34% respectively [1] Group 1: Child-Friendly Services - The airport has implemented a "Unaccompanied Minor Reception Station" to assist children aged 5 to 12 traveling without adult supervision, providing services such as check-in, dedicated escorts, and real-time updates for parents [4] - Over 5,000 unaccompanied minors have been supported since the start of the summer travel season, with a peak of 471 children assisted in a single day on July 6 [2][4] Group 2: Cultural Experience Initiatives - Baiyun Airport has introduced traditional cultural performances, including a mini version of the award-winning Yingge dance, to enhance the travel experience and promote cultural heritage [5][6] - The airport plans to host various cultural exhibitions and interactive activities throughout the summer, collaborating with local cultural institutions to provide a rich cultural experience for travelers [6] Group 3: Commercial Ecosystem Enhancements - A "Food Festival" has been launched at the airport, featuring discounts at 77 restaurants, including well-known Cantonese brands, to enhance the dining experience for travelers [7] - The airport is promoting payment convenience with special discounts for domestic and international UnionPay cardholders, encouraging spending within the airport [7][8] - A "Cloud Treasure Hunt" activity has been organized for children, linking various shops and cultural exhibits, incentivizing participation with collectible rewards [8]

Core Viewpoint - The construction of airports in small and medium-sized cities in China is driven by the desire to enhance local economic development and improve transportation accessibility, despite the financial challenges and operational losses faced by many of these airports [4][13][30]. Summary by Sections Airport Distribution and Characteristics - As of the end of 2024, there are 263 transport airports in China, with 81% located in third-tier and below small cities [4]. - Among the 213 small cities with airports, 84% have airports with passenger traffic below 2 million, and about 32% of these airports have seen a decline in passenger traffic [4][18]. Economic Impact of Airport Construction - Building airports can significantly boost local GDP and tax revenue, especially in economically underdeveloped regions. In 2024, cities with airports experienced GDP growth approximately 1% faster than the national average, and areas with small airports saw growth about 3% faster [13][14]. - Airports improve transportation conditions, allowing for greater connectivity and economic activity, which is particularly vital for regions with geographical constraints [14][29]. Financial Viability and Challenges - The initial investment for constructing a small to medium-sized airport in the western regions of China typically ranges from 1.2 billion to 1.5 billion yuan, with annual depreciation costs exceeding 50 million yuan [17]. - Many small airports rely heavily on government subsidies to maintain operations, with 78.7% of small airports reported to be operating at a loss [20][25]. Government Support and Subsidies - The Civil Aviation Administration of China has allocated a total of 10.6 billion yuan in subsidies for small airports from 2021 to 2025, with a projected 2.405 billion yuan in subsidies for 2025 [26]. - The subsidies are crucial for airports with annual passenger traffic below 2 million, as they often cannot cover operational costs through revenue alone [18][25]. Revenue Generation Strategies - Airports need to enhance their "self-sustaining" capabilities by diversifying revenue sources, particularly through non-aeronautical income, which has higher profit margins [27]. - Successful examples, such as Huizhou Airport, demonstrate the potential for profitability through effective commercial management and integration with broader transportation networks [28]. Future Considerations - The ongoing trend of airport construction in small cities reflects a broader contradiction in China's urbanization process, where infrastructure investments may not align with actual local demand [29][30]. - The focus should shift towards optimizing the operation of existing airports to better serve local development needs rather than merely pursuing new constructions [31].

Core Viewpoint - The construction of airports in small and medium-sized cities in China is driven by the desire to enhance local economic development, improve transportation accessibility, and attract tourism, despite the financial challenges and operational losses faced by many of these airports [2][12][21]. Summary by Relevant Sections Airport Construction in Small Cities - The recent inauguration of Lishui Airport highlights the long-awaited connectivity for local residents, emphasizing the importance of such infrastructure in enhancing accessibility and promoting tourism [2]. - As of 2024, 263 transport airports are operational in China, with 81% located in small and medium-sized cities, where 84% of these airports handle fewer than 2 million passengers annually [3][4]. Economic Impact and Justification - Experts suggest that airport construction can significantly boost local GDP and tax revenues, particularly in economically underdeveloped regions, with airport cities experiencing GDP growth rates approximately 1-3 percentage points higher than the national average [12][14]. - Airports serve as critical infrastructure, improving transportation conditions and generating substantial economic multipliers, with every 1 yuan invested yielding 8 yuan in output [13]. Financial Viability and Challenges - Despite the potential benefits, many small airports operate at a loss, with 78.7% of them reported to be unprofitable, primarily relying on government subsidies to cover operational costs [14][15]. - The average initial investment for a small airport ranges from 1.2 billion to 1.5 billion yuan, with annual depreciation costs exceeding 50 million yuan, making profitability challenging in the short term [14]. Role of Government Support - Government subsidies are crucial for the survival of small airports, with the Civil Aviation Administration of China allocating significant funds for operational support, including a projected 2.405 billion yuan in subsidies for 2025 [17]. - The focus on enhancing non-aeronautical revenue streams, such as commercial activities within airports, is essential for improving financial sustainability [18]. Integration with Transportation Networks - Successful examples, such as the integration of airports with high-speed rail networks, demonstrate the potential for expanding passenger bases and enhancing operational efficiency [19]. - The development of coordinated transportation systems can significantly improve the viability of small airports by increasing their catchment areas and reducing operational costs [18]. Conclusion - The ongoing trend of airport construction in small cities reflects a broader strategy to stimulate local economies and improve connectivity, necessitating a focus on operational efficiency and integration with existing transportation networks to ensure long-term sustainability [20][21].

Financial Data and Key Metrics Changes - Total passenger traffic reached 15.8 million, a 4.1% increase compared to the same quarter of 2024 [7] - Revenue generation excluding IFRIC 12 grew by 30.6% year over year, reaching ARS 8.2 billion, driven by a 26.4% increase in aeronautical revenues and a 41.8% increase in non-aeronautical revenues [11] - EBITDA increased by 31.1%, reaching ARS 5.5 billion, with an EBITDA margin of 67.1% excluding IFRIC 12 [13] - Net income increased by 17.9%, reflecting solid underlying fundamentals [14] - Cash and cash equivalents stood at ARS 9.7 billion as of June 30 [14] Business Line Data and Key Metrics Changes - Revenues from business lines operated directly by the company increased by 113%, driven by the consolidation of the cargo and bonded warehouse business [12] - Third-party operated business grew by 10.7%, with significant contributions from food and beverage, retail, duty-free, ground transportation, and timeshares [12] Market Data and Key Metrics Changes - The company added eight new routes this quarter, including seven domestic and one international, bringing the total to 21 new routes for the year [7] - Canada is becoming an increasingly relevant market, especially during the winter season [8] Company Strategy and Development Direction - The company is focused on strategic expansion opportunities, including the Turks and Caicos tender process and potential acquisition of CCR Airports assets [19] - The company aims to maintain its annual guidance despite potential impacts from U.S. migration policies [10] - Capital investments of about MXN 12.8 billion were executed in the first half of 2025, in line with annual plans [15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the impact of peso volatility and U.S. macroeconomic conditions on discretionary travel [16] - The company expects to maintain its initial annual guidance despite potential challenges [10] - Management noted that the traffic trends are changing day by day, particularly in relation to U.S. migration policies [37] Other Important Information - A dividend of MXN 16.84 per share was approved for payment throughout 2025, with the first tranche already distributed [17] - The company is actively managing liabilities and maintaining a healthy balance sheet with a net debt to EBITDA ratio of 1.8 times [15] Q&A Session Summary Question: Potential inorganic opportunities with Turks and Caicos and CCR - Management indicated that there are opportunities in Latin America and the Caribbean, but not all will yield the desired returns [22] Question: Status of the hotel in Guadalajara Airport - The hotel has achieved an average tariff of around 2,500 and an occupancy rate of approximately 80% in its first year of operation [24] Question: Tariff increases and airline negotiations - The first tariff increase was implemented in March, with another expected in January 2026, pending market conditions [30][31] Question: Traffic trends and demand stabilization - Management noted a potential improvement in traffic trends as passengers become more comfortable with migration policies [37] Question: Impact of U.S. Department of Transportation claims - Management stated that the impact on the company is uncertain, but they are more concerned about the broader bilateral relationship between the U.S. and Mexico [78]

Group 1 - The core theme of the event at Xi'an Xianyang International Airport is the "Joyful Summer Cultural Experience," showcasing Tang Dynasty culture through interactive activities [1] - Staff dressed in traditional Tang attire engaged travelers in various activities, creating a unique cultural atmosphere within the terminal [1] - Travelers participated in poetry challenges and traditional games, receiving cultural gifts, enhancing their travel experience with a blend of history and modernity [1] Group 2 - The airport has upgraded its services significantly to meet traveler demands during the summer peak, including over 200 new charging points and extended operating hours for food outlets [2] - Special services have been introduced for children's educational groups and corporate transit groups, ensuring a smoother travel experience with dedicated check-in and boarding assistance [2] - A feedback initiative called "Spark Action: Inspiration Marathon" has been launched, allowing travelers to suggest service improvements, with 327 proposals received so far [2] Group 3 - Since the summer travel season began, Xi'an Xianyang Airport has reported impressive statistics, with 16,300 flight operations and 2.316 million passengers handled [3] - The airport has established a comprehensive transportation network with 204 operational points and 294 routes, including 19 routes with an average of over 10 flights per day [3] - The airport's international flight capacity has increased, with a 65% share of wide-body aircraft on international routes, enhancing the quality of intercontinental travel [3]

Core Viewpoint - Xi'an Xianyang Airport has launched the "Spark Action" to enhance passenger travel experience and service quality, inviting travelers to share their experiences and suggestions for creating a first-class airport service that is quality-driven, warm, and engaging [1][3]. Group 1: Service Improvement Initiative - The "Spark Action" is centered around a passenger-centric approach, aiming to address service pain points by listening to the genuine voices of travelers, whether they are frequent flyers or first-time visitors [3]. - The initiative includes a "Service Inspiration Marathon" where passengers can provide feedback on various aspects of the airport experience, including check-in, security, baggage claim, signage, and facilities [3]. Group 2: Participation and Rewards - The airport has simplified the participation process, allowing travelers to submit their suggestions through a WeChat mini-program, with multiple awards such as "Spark Lucky Prize," "Spark Creative Prize," and "Spark Selection Prize" to encourage participation [6]. - The initiative will run until August 10, 2025, and aims to gather insights from travelers to transform their suggestions into actionable service improvements, with selected participants becoming "Spark Experience Officers" to engage in the optimization process [6].

Core Insights - In 2024, Shanghai Port's container throughput reached 51.506 million TEUs, maintaining its position as the world's largest for 15 consecutive years [1] - Shanghai Airport's air cargo and passenger throughput reached 4.206 million tons and 125 million passengers respectively, with year-on-year growth of 11% and 29%, ranking second and third globally [1] Group 1: Shanghai Port Developments - Shanghai Port experienced a 10.2% year-on-year increase in container throughput in May, alongside a notable rise in the number of container ships docking [4] - The average waiting and operation times for container ships have decreased due to lean management and smart port initiatives [4] - The port is advancing towards becoming a green energy refueling center, having successfully conducted the first batch of domestic green methanol refueling for international vessels [4] Group 2: Shanghai Airport Enhancements - The Shanghai Airport Group has implemented a special project to optimize luggage services, improving the first and last luggage retrieval rates from 79.65% in March to 87.2% in May [3] - Cross-border e-commerce cargo throughput at Pudong Airport increased by 29.3% from January to May [3] Group 3: Governance and Management Initiatives - The Shanghai Municipal Transportation Commission is focusing on enhancing party discipline and management effectiveness through comprehensive training and problem-solving mechanisms [2] - A closed-loop management system has been established to address identified issues, with 7 out of 19 immediate problems already resolved [2] - The emphasis on service quality and operational efficiency is part of a broader strategy to enhance the business environment and leadership capabilities within the transportation sector [3]

Core Points - The "Spark Action" service quality improvement initiative was launched at Xi'an Xianyang International Airport, involving collaboration with customs, border inspection, and 43 stationed airlines [1] - The airport has officially opened the T5 terminal, enhancing its infrastructure to meet international standards and accommodating an annual passenger throughput of 83 million [1] - The initiative aims to create a comprehensive service optimization system focusing on operational efficiency, service processes, standard execution, product innovation, and atmosphere creation [1] Summary by Sections - The "Spark Action" initiative emphasizes the importance of service quality as a lifeline for the airport, aiming to transition from standardized to personalized and intelligent service [2] - Passenger satisfaction will be integrated into performance evaluations, utilizing digital tools for real-time monitoring of service quality [2] - The initiative seeks to consolidate various expertise to enhance service levels, ultimately contributing to the establishment of a world-class aviation hub [2]