Grupo Aeroportuario del Sureste(ASR) - 2021 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Cash and cash equivalents increased by 11% to MXN 5.7 billion from year-end levels, with cash increases of over MXN 600 million in Mexico and nearly MXN 7 million in Puerto Rico, partially offset by a MXN 64 million decline in Colombia [11] - Revenues, excluding construction, decreased by 36% year-on-year to MXN 2.7 billion, with aeronautical revenues declining in the high 20s and nonaeronautical revenues declining in the mid 30s [13][15] - Consolidated EBITDA declined by 42% year-on-year to MXN 1.3 billion, with an adjusted EBITDA margin of 58.8%, down from 69.9% in Q1 2020 but improved from 54.6% in Q4 2020 [17] Business Line Data and Key Metrics Changes - In Mexico, revenues accounted for 64% of total revenues, while Puerto Rico and Colombia represented nearly 26% and 2%, respectively [15] - Cost reductions contributed to a 21% year-on-year decline in consolidated costs, with costs in Mexico declining nearly 10% and costs in Puerto Rico down nearly 41% [16][17] - Capital expenditures during the quarter were nearly MXN 360 million, with over 90% invested in Mexico [18] Market Data and Key Metrics Changes - Passenger traffic in the first three months of the year was down 32% year-over-year, with Mexico down 36%, Puerto Rico down 20%, and Colombia down 30% [7] - Domestic traffic showed better trends, with declines in the mid-high teens in Mexico and Puerto Rico, while international traffic saw declines of nearly 50% in Mexico and Colombia, and 70% in Puerto Rico [7][10] Company Strategy and Development Direction - The company concluded a revision of its master development plan, resulting in a reduction of around MXN 2.65 billion from the previously committed investments [5] - The company remains optimistic about long-term global travel demand and expects traffic to return to pre-pandemic levels within 10 to 18 months [10][31] Management Comments on Operating Environment and Future Outlook - Management noted that while domestic traffic is expected to recover in the near term, international traffic will become more relevant in the medium term as pent-up demand drives traffic [10] - The company is analyzing the impact of new outsourcing laws in Mexico but does not expect significant changes in service provision for security and cleaning [32][33] Other Important Information - The company welcomed new independent board members, enhancing its commitment to ESG initiatives [6] - The company has maintained a strong balance sheet with low near-term principal payments, with just over 5% of total debt maturing in the next nine months [11] Q&A Session Summary Question: Update on Paris Act reimbursements in Puerto Rico - The remaining balance is MXN 9 million, with an additional MXN 10 million expected for the second half [22] Question: Update on new maximum airport tariffs - Tariffs are applicable from January 1st, but full implementation may not be reached this year due to traffic and passenger mix [24][25] Question: Dividend payments for this year - A dividend of MXN 8 was approved, with the payment date subject to Board approval from May 11 [26] Question: Traffic recovery timeline - The company expects to reach pre-pandemic traffic levels within 10 to 18 months [31] Question: Impact of new outsourcing law - The company is analyzing the situation and does not believe security and cleaning services will be considered as insourcing [33] Question: CapEx figures and traffic recovery - The CapEx postponement was considered in new figures, with MXN 3 billion budgeted for this year, and optimism for traffic recovery due to US vaccination efforts [35] Question: Nonaeronautical revenues and tenant relationships - The company expects no major issues with commercial tenants, as most contracts are adjusted automatically [47]