Total Passenger Traffic Growth (Q4 2024): 4.6% increase, with domestic traffic up 1.5% and international traffic up 26.4%. Full Year Domestic Traffic (2024): Declined by 3.5% compared to 2023. Full Year International Traffic (2024): Increased by 15% compared to 2023. Commercial Revenue Per Passenger (2024): MXN60, a 17% increase from 2023. Restaurant Revenue Growth (2024): Increased by 22% compared to 2023. VIP Lounge Revenue Growth (2024): Increased by 51% compared to 2023. Parking Revenue Increase (2024): MXN33 million compared to 2023. OMA Cargo Growth (2024): Increased by 22%. Hotel Services Revenue Growth (2024): Nearly 20% increase compared to 2023. Industrial Service Revenue Growth (2024): Increased by 61%. Aeronautical Revenue Growth (2024): Increased by 2% compared to 2023. Non-Aeronautical Revenue Growth (2024): Increased by 17% compared to 2023. Adjusted EBITDA (2024): MXN9.1 billion with a margin of 74.3%. Q4 2024 Revenue: MXN3.3 billion, with aeronautical revenue up 11% and non-aeronautical revenue up 22%. Commercial Revenue Growth (Q4 2024): Increased by 19% compared to Q4 2023. Diversification Revenue Growth (Q4 2024): Increased by 28%. Industrial Services Growth (Q4 2024): Increased by 130.8% to MXN47 million. Hotel Services Growth (Q4 2024): Increased by 19%. OMA Carga Growth (Q4 2024): Increased by 18%. Adjusted EBITDA (Q4 2024): MXN2.4 billion with a margin of 73.8%. Consolidated Net Income (Q4 2024): MXN1.2 billion, a decrease of 5.9% from Q4 2023. Cash Generated from Operating Activities (Q4 2024): MXN1.9 billion. Cash Balance (End of Q4 2024): MXN1.7 billion. Total Debt (End of Q4 2024): MXN11.5 billion. Net Debt to Adjusted EBITDA Ratio (End of Q4 2024): 1.1 times.

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Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Grupo Aeroportuario del Centro Norte SAB de CV (NASDAQ:OMAB) reported a 4.6% increase in total passenger traffic in the fourth quarter of 2024, with international passenger traffic growing by 26.4%. The company achieved a record high commercial revenue per passenger of MXN60 in 2024, a 17% increase compared to 2023. OMA's cargo business grew by 22% in 2024, driven by organizational changes to improve efficiency and customer service. The industrial park business saw a 61% increase in revenue, supported by strong industrial activity in the Monterrey region and the depreciation of the Mexican peso against the US dollar. All 13 OMA airports obtained Level 3 Optimization Certification on the Airport Carbon Accreditation Program, highlighting the company's commitment to sustainable airport management.

Story Continues

Negative Points

Domestic passenger traffic declined by 3.5% in 2024, influenced by aircraft capacity constraints and operational restrictions at Mexico City International Airport. The company faced a 97% increase in concession tax due to a rate hike from 5% to 9%, impacting financial results. A bad debt expense of MXN9.7 million was recognized due to a nonperforming tenant in the Monterrey Industrial Park. Consolidated net income decreased by 5.9% in the fourth quarter of 2024 compared to the same period in 2023. The company experienced a significant increase in financing expenses, primarily due to a noncash effect related to changes in the present value of the major maintenance provision.

Q & A Highlights

Q: Can you talk about your traffic outlook for this year and the development of Monterrey's route network? A: Ruffo Perez Pliego Del Castillo, CFO, stated that they expect a mid-single-digit growth in traffic for the year, with a recovery in domestic capacity. Monterrey is positioned as a connecting hub, and many new routes opened last year are still maturing, indicating continued growth potential.

Q: How does the traffic outlook affect your MDP negotiations, and is there room to ramp up CapEx in Monterrey? A: Ricardo Duenas Espriu, CEO, explained that the traffic projection is based on a mid- to long-term view, considering various factors. The CapEx plan is being optimized to avoid unnecessary pressure on tariffs, leveraging internal and Vinci's expertise.

Q: What is the timing for the MDP announcement, and do you foresee any significant cost pressures in 2025? A: Ricardo Duenas Espriu, CEO, mentioned that the MDP plan will be presented by the end of June, with negotiations expected to conclude by December. Ruffo Perez Pliego Del Castillo, CFO, noted that cost increases are expected to be inflationary-based, with no significant pressures anticipated.

Q: Can you provide more details on the interest expense increase and its future impact? A: Ruffo Perez Pliego Del Castillo, CFO, explained that the increase was due to adjustments in the interest rate used for valuing the major maintenance provision, which is sensitive to rate changes. This is a non-cash effect and will vary with interest rate fluctuations.

Q: How do you view the sustainability of international traffic growth, and is it driven by opportunistic or demand-driven factors? A: Ruffo Perez Pliego Del Castillo, CFO, attributed the growth to the recovery of Category 1 status, allowing Mexican carriers to open new routes to the US. The trend is expected to continue, with most international routes focused on US destinations.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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