The following is a summary of the Grupo Aeroportuario Del Centro Norte, S.A.B. De C.V. (OMAB) Q2 2024 Earnings Call Transcript:
Financial Performance:
Aeronautical revenue decreased by 2.5% due to a decline in domestic passenger traffic, which fell 4.3% largely due to the Pratt & Whitney engine recall affecting Mexican low-cost carriers. Non-aeronautical revenues, however, grew by 13.8%.
Total revenues for the quarter grew marginally by 1.1% to MXN2.9 billion, despite a decrease in construction revenues by 22%.
Adjusted EBITDA for Q2 2024 reached MXN2.2 billion, achieving an adjusted margin of 73.3%. Excluding surplus concession tax effects, the adjusted EBITDA would have been MXN2.3 billion with a margin of 76.3%.Net income increased by 1.5% compared to the same quarter last year.
Business Progress:
OMA launched six new international routes in the first half of the year, four from Monterrey, enhancing international connectivity. Major infrastructure developments include the expansion and remodeling at Monterrey airport, notably the inauguration of the Terminal A East public area, as part of a broader expansion project.
OMA's cargo operations grew significantly, with a 35% increase, bolstered by a new route with Lufthansa Cargo and an upcoming 50% expansion in warehouse capacity at Monterrey.
Hotel services also saw growth with higher operational metrics and room rates.
Opportunities:
Expansion in international routes and the addition of Lufthansa Cargo's operations present significant growth opportunities in both passenger and cargo services.
OMA plans to exploit near-shoring opportunities, notably with the expansion of warehouse capacities and the potential development of industrial parks.
Risks:
The Pratt & Whitney engine recall will continue to impact traffic flows, primarily domestic routes, resulting in potentially sustained lower aeronautical revenues in the near term.
Concession tax increased dramatically by 71% due to a rate hike from 5% to 9%, impacting financial flexibility and operating costs.
The regulatory burden of increasing concession taxes and the need to comply strictly with maximum tariffs presents a prolonged financial challenge.
More details: Central North Airport IR
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