Grupo Aeroportuario del Centro Norte S.A.B. de C.V.

Greetings. Welcome to the Grupo Aeroportuario del Centro Norte OMA Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during a conference, please press star zero on your telephone keypad. I will now turn the conference over to your host, Emmanuel Camacho. You may begin.

Thank you, Yosemite. Hello, everyone. Welcome to OMA Second Quarter 2024 and its conference goal. We're delighted to have you join us today as we discuss our company's performance and financial results for the past quarter. Participating today are CEO Ricardo Duenas and CFO Rufo Perez-Pierro. Please be reminded that certain statements made during the course of our discussion today may constitute forward-looking statements which are based on current management expectations and beliefs and are subject to a number of recent uncertainties that could cause actual results to differ materially, including factors that may be beyond our control. With that, I'll turn the call over to Ricardo Doveñas for his opening remarks.

Thank you, Manuel. Hello, everyone, and thank you for joining us today. This morning, I will review our operational performance and financial results. Then I will briefly comment on recent CapEx milestones occurred during the quarter. And finally, we will be pleased to answer some questions. In the second quarter of 2024, almost passenger traffic reached 6.5 million, a decrease of 2.4% versus the second quarter of last year. Domestic passenger decreased 4.3%. Excluding Acapulco, where tourist infrastructure continues to recover from the impact of Hurricane Otis in October 23, our domestic passenger traffic declined by 3.1%. This was primarily due to the Pratt & Whitney engine recall affecting the fleet of Mexican low-cost carriers. The most impacted airports were Monterey and Culiacan, particularly on routes such as Monterey to Cancun and Mexico City and Culiacan to Mexicali and Tijuana. Despite a 10% decline in our routes to the Mexico City International Airport during the quarter, mainly due to the reduction in movements per hour announced by the Mexican government at the beginning of the year, our connectivity to the Mexico City metropolitan area, including also Toluca and Santa Lucia airports, increased by 2.8%. This demonstrates that demand for flights to Mexico City remains robust, with airlines responding by adding capacity to these alternate airports. There has been a clear trend towards maintaining capacity within the Mexico City airport system while also utilizing available capacity to enhance international coverage connectivity to the U.S., strengthening existing routes and introducing new ones. International passenger traffic achieved a strong performance in the second quarter with a 12% increase compared to the second quarter of last year. This road was primarily driven by the Monterey Airport, with significant increase on routes to Atlanta, Las Vegas, Toronto, and Orlando. These routes, along with Mazatlán to Los Angeles route, accounted for approximately 60% of international passenger traffic increase during the quarter. Additionally, in the first half of the year, we launched six new international routes, four of which were based on the Monterey Airport further strengthening our international connectivity. Moving on to an almost financial performance. Aeronautical revenue decreased by 2.5%, primarily driven by the performance of our domestic passenger traffic. Aeronautical revenue per passenger remained flat compared to the second quarter of last year. Despite the decline in passenger traffic, non-aeronautical revenues grew by 13.8%, underscoring the successful execution and consolidation of several strategic projects throughout the year. Commercial revenues increased 12% compared to the second quarter of last year, primarily driven by VIP lounges and parking revenues, along with several other categories. VIP lounges saw significant benefits this quarter due to higher access rates and the effect of the previously opened lounges in Reynosa, Tampico, and Durango. In addition, leases of third-party lounges in Monterey were renewed under improved terms. Parking revenues increased primarily due to an overall optimization of tariffs across our 13 airports. Revenue from restaurants, car rentals, and retail grew driven by the contribution of commercial spaces opened during the previous quarters. Finally, duty-free revenue increased due to our strategy of relocating international flights among terminals in Monterey, boosting passenger exposure to commercial spaces and increased revenues per passenger. The occupancy rate of commercial space stood at 95.3% at the end of the quarter. On the diversification front, revenues increased 27%. OMA Cargo contributed most of this quarter's growth with an increase of 35%, mainly due to higher revenues from ground and air cargo operations in Monterey. In addition, during May, we began operations with our new client, Lufthansa Cargo, which did not operate previously in Monterey, offering air cargo transport services with an initial frequency of one flight per week between Mexico City, Monterey, and Frankfurt. This new route is part of our strategy to establish our airport as a key logistics hub. In addition, we will soon begin expansion of our Alma Cargo Monterey warehouse capacity by almost 50%, allowing us to capitalize on nearshoring opportunities. Hotel services grew by 16%, mainly as a result of an increase in operations in both hotels. In the second quarter of this year, occupancy rate of our Terminal 2 NH was 85%, while Hilton Garden Inn Hotel had an occupancy rate of 79%. Additionally, we recorded a double-digit increase in average room rate per night on both hotels. Moving on to capital expenditure front, I would like to highlight that during the quarter, we achieved a significant milestone in our long-term infrastructure development at the Monterey Airport. As part of our expansion and remodeling project, we successfully inaugurated the Terminal 8 East Public Area expansion. Covering over 6,000 square meters, this new area features double documentation counters, commercial outlets, airport services, and other facilities. These enhancements contribute to improving our services and increasing airport capacity. This completion marked the third phase of our initial expansion project following the early openings of the West Public Area of Terminal A and the Wing 1 building. As a result of these initiatives, Monterey's current terminal capacity has grown to 13.9 million passengers annually. Additionally, during the quarter, we invested 816 million pesos in MDP investments, major maintenance, and strategic projects. Notably, we are actively working on expanding and remodeling terminal buildings in Monterey, Ciudad Juarez, Torreon, Culiacan, Durango, and Mazatlan. These projects reflect our commitment to enhancing airport facilities and services for passengers and stakeholders. I would now like to turn the call over to Rufo Perez-Pierro, who will discuss our financial highlights of the quarter.