Grupo Aeroportuario del Sureste, S. A. B. de C. V.

Good day, ladies and gentlemen, and welcome to Assure's third quarter 2026 results conference call. My name is Melissa, and I'll be your operator. At this time, all participants are in a listen-only mode. We will conduct a question and answer session toward the end of today's conference. If you would like to ask a question, please press star 1. If you would like to withdraw your question at any time, please press star 2. If you're using a speakerphone, please lift the handset before making a selection. As a reminder, today's call is being recorded. I'd now like to turn the call over to Mr. David Barlow, Corporate Governance, Strategic Planning Manager, and Investor Relations Officer at ASUR. Please go ahead, sir.

Thank you, Melissa, and thank everyone for joining us today to discuss ASUR results for the third quarter of 2026. With me on today's call is Adolfo Castro, Chief Executive Officer. Additional details about our results can be found in our press release which was issued yesterday after market close and is available on our website. As usual, all comparisons discussed on this call will be year-on-year and all figures are expressed in Mexican pesos unless specified otherwise. As a reminder, certain statements made during the call today may constitute forward-looking statements Thank you, David, and good morning, everyone.

The third quarter marked an important milestone for ASUR. On September the 1st, we completed the acquisition of CPC Aeroportos Promotiva, which added 20 airports over Porto Aforio, the majority of which are located in Brazil. Coupled with our December 2025 acquisition of the U.S. Commercial Operations, we have taken significant actions in the restifying ASUR's operations. In turn, Azur has evolved into the leading international airport operator across the Americas. Today, our portfolio spans 36 airports across seven countries, complemented by commercial operations at three major U.S. airports. To put this scale in perspective, the combined airport portfolio served approximately 120 million passengers in 2025 on a pro forma basis, Up from 70 million were reported last year. We now have much broader business than the Mexican airport group that was established nearly three decades ago. CPC Aeroportos had 17 airports in Brazil, one on each in Ecuador, Costa Rica, and Curaçao. This gave us an established presence in Brazil, Latin America's largest aviation market, and expands our operation into three additional markets. The final purchase price was 5.5 billion Reais or approximately 992 million dollars after customary closing adjustments. Our results for the third quarter include operations solely for the month of September which are consolidated under the region called Brazil and others. As a larger, more diverse company, our operations are now spread across more markets with different passenger profiles, reducing our dependence on one market. It also provides more opportunities to apply the operating and commercial experience we have built up many years. While we do not expect to capture significant operating synergies, our focus now is on implementing Thank you very much. Thank you. Our U.S. commercial business gives us another avenue for growth. At GFK, LAX, at Chicago O'Hare, We are building a platform on non-regulated dollar-denominated commercial revenues. The next major project is the new Terminal 1, expected to be open toward the end of the first quarter next year. We also continue developing commercial expenses at LAX to be ready for the Olympic Games in 2028. The business today is only a small contribution of what we expect the long-term potential of this new business to be. While we are very excited about these new opportunities, at the same time, Mexico remains central of our business and investment program. Within Mexico, Cancún is an important market for us, with significant investments on the way. to improve operational efficiencies and support future growth. We are taking a long-term view of Cancún's development while managing the current operating environment. First, the expected remodeled and expanded Terminal 1 construction will be completed during this fourth quarter, and then we will proceed with the operational readiness and airport transfer to start operations in the first quarter. Terminal 1 will allow us to redistribute passenger flows and relieve pressure of Terminal 2. It will also create additional commercial capabilities and improve passenger experience. We are also investing in Terminal 4, with the project expected to be operational at year-end 2028. This investment will provide 12 additional boarding gates, on top of the 4 we added during 2027, and three more due to the expansion of Terminal 1 and a connecting taxiway and related infrastructure. Our capital allocation continues to balance investment into business to support growth and improve efficiencies with returns to shareholders. There are two extraordinary dividends of $10 each, payable on November 30th and December 23rd this year. Turning to our energy strategy, during the third quarter we began procuring clean energy from a third-party supplier in Mexico. We purchased 13.1 million kilowatt-hours, representing more than 40% of the electricity consumption at our Mexican airports during the quarter. We also began the executive design of additional solar panels in our parking facilities. These are expected to become operational in 2027. and could generate an additional 8 million kWh of renewable energy annually. Our efforts to advance renewable energy also earned recognition during the quarter, with Airport Council International awarding the U.S. Green Airport recognition for our Digital Renewable Energy Management System project. Moving on to passenger traffic, total traffic decreased 1.2% to 20.9 million passengers and includes one-month contribution from Brazil and others. Considering September 2025, data for comparison purposes. Lower traffic in Mexico and Puerto Rico was partially offset by growth in Colombia as they acquired portafolio. Mexico Traffic declined nearly 5%, primarily due to weaker international traffic at El Cú. Growth in domestic traffic across our other eight Mexican airports partially offset this weakness. Airline capacity constraints, including Spirit Airlines bankruptcy, higher jet fuel prices, continue to wait on demand, particularly for international travel. Passenger volumes by region to and from the United States, Europe, South America decreased by 14.9%, 14.4%, 7.9% respectively, while Canada increased by 5.7%. In Puerto Rico, traffic declined slightly over 3% due to continued impact from the bankruptcy of Spirit Airlines. Early May and softness in both domestic and international demand. On a positive note, September showed an improvement with total traffic increasing just over 3%, following declines in July and August. Colombia continued to outperform the rest of the portfolio, with traffic just over 5%, reflecting a strength in both domestic and international traffic, benefiting from better connectivity and healthy demand. Total traffic figures for the quarter also include one-month contributions from operations in Brazil and others, which as a whole increased just over 1% and added nearly 4 million passengers in September. This is mainly driven by low single-digit growth in Brazil and Ecuador, more than offsetting the mid-low single-digit declines in Costa Rica and Curaçao. On a bigger picture macro front, we don't see any near-term improvement as conditions remain challenging. Particularly for international traffic in Mexico, although airlines' schedules for the winter season indicate only more seat capacity for December than a year ago, which is not encouraging for the whole winter season. The September improvement in Puerto Rico is encouraging, while Colombia continues to grow. We remain cautious of the pace of recovery, while at the same time, our focus on supporting the long-term demand fundamentals across our border portfolio. And with CPC, we diminish the dependence in Mexico and basically in one airport. Turning next to the financial performance, as a reminder, the figures I will discuss exclude construction revenue and construction costs, or less otherwise noted. Revenues increased nearly 13% to 7.8 billion pesos. Non-aeronautical revenues grew just under 27%, including 456 million pesos from the U.S. operations, 362 million pesos from the first month of consolidation of Brazil and others, and 16% growth in Colombia, offsetting the softer performance in Mexico and Puerto Rico. Aeronautical revenues were up 5% to $4.8 billion, including a $315 million peso contribution from Brazil and others. Higher passenger traffic supported higher aeronautical revenues in Colombia, while Puerto Rico's aeronautical revenues increased primarily due to the change rate difference. These gains were partially offset by softer traffic in Mexico. Commercial revenue per passenger increased 3.5% to 130.5 pesos, mainly reflecting the contribution of our U.S. commercial operations. Puerto Rico posted the highest commercial revenue per passenger at 163.3 pesos, up 2%, followed by Mexico with 129 pesos. was 10% lower year-on-year, mainly reflecting the lower traffic and passenger mix. Colombia delivered double-digit growth, reaching 65.2 pesos, while Brazil and others added 64.7 pesos in commercial revenues per passenger. We continue expanding our commercial footprint. Over the past 12 months, we opened 39 new commercial spaces across Mexico, Puerto Rico, and Colombia. 31 in Colombia, 7 in Puerto Rico, and 1 in Mexico. Moving on to profitability, consolidated EBITDA increased 1.7% to $4.7 billion. Brazil and others contributed $313 million in September, and our U.S. commercial operations at $49 million in the quarter. This, together with increases of 7% in Puerto Rico driven by a lower operating cost, Adolfo Castro Rivas, Adolfo Castro Rivas, Adolfo Castro Rivas, Adolfo Castro Rivas, for September 2026, while the U.S. reported an EVDA margin close to 11%. Recall this business has a different cost structure from our airport operations, including lease obligations to airport authorities, and the margin is not directly comparable. We also incurring expenses for projects that are not yet generating revenues, including commercial spaces at our U.S., Operations, which are expected to open until 27th and 28th. On the balance sheet, we close the quarter with cash and cash equivalents of 20 billion pesos and a total debt of nearly 70 billion pesos. Of these, 26.5% was denominated in Mexican pesos, 46.4% in U.S. dollars corresponding mainly to Puerto Rico, and 27.1% in Brazilian reais. Net debt of last 12 months in PDA was 2.6 times, up from 0.2 times, reflecting the acquisition, financing, and addition of the debt from the commercial operation in U.S. and Brazilian others. At the quarter end, Cancún Airport placed $1.8 billion senior notes in two tranches, $900 million due in Q in 2031 and $900 million in 2036. These notes carry an investment rating by S&P and Fitch. We use the net proceeds to repay the Fitch facilities for the U.S. and CPC acquisitions, repay the remaining Santander loans, and partially prepaid the PBA loans. This refinancing extends our debt maturities by seven years on average. Lastly, capital expenditures total 2.7 billion pesos during the quarter. With the majority expanded in Mexico as we advance in our mass development program. At yesterday's exchange rate converted to Mexican pesos for each region, next year, we expect to invest close to 6 billion pesos in Mexico, 1.8 billion in Costa Rica, 1.7 billion in Puerto Rico, 1.5 in Brazil, 414 million in our U.S. commercial operations. 230 million in Colombia and 213 in Curaçao. We expect to fund all of these with resources generated by the operation of the region, except for Puerto Rico. This is a total of 11.1 billion pesos. Main projects include the start of the second phase of the expansion of Terminal 4 at Cancún Airport, The beginning of the construction of a second runway at Curitiba Airport to be completed in 2029. Runway refurbishing at Belo Horizonte, Goiana, Teresina and San Luis Airports in Brazil, which is expected to be completed in 2027. Also to be completed in 2027 is the first phase of the terminal expansion at San José Airport in Costa Rica. Also, a hangar relocation that will allow for the second phase expansion of this terminal in 2028. Wrapping up, ASUR is making consistent progress in executing the strategic priorities, optimizing its structure, and further diversifying its geographic operations. We accomplish this in a challenging operating environment, particularly in Mexico, and we remain cautious on the pace of the recovery. At the same time, we completed an important acquisition, obtained approval for a more efficient corporate structure and refinanced our acquisition bridge loans with a long-term debt. Our broader airport portfolio, U.S. commercial platform and continuing investment in capacity provide a source of additional opportunities for long-term growth. We remain focused on operating performance, improving further efficiencies, disciplining capital allocation, and delivering value to our shareholders, including through dividend payments. This ends our prepared remarks. We are ready to take your questions. Please, Melissa, open the floor for questions.