Corporacion America Airports SA

Good morning and welcome to the Corporacion America Airports third quarter 2021 earnings conference call. A slide presentation accompanies today's webcast and is available in the investor section of Corporacion America Airports investor relations website. As a reminder, all participants will be in a listen only mode. There will be an opportunity to ask questions at the end of the presentation. Please also note this event is being recorded. At this time, I would now like to turn the call over to Patricio Iñaki-Esnaola, Head of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and thank you for joining us today. Speaking during today's call will be Martín Ornequian, our Chief Executive Officer, and Jorge Arruda, our Chief Financial Officer. Before we proceed, I would like to make the following safe harbor statement. Today's call will contain forward-looking statements and I refer you to the forward-looking statement section of our earnings release and recent filings with the SEC. We assume no obligation to update or revise any forward-looking statement to reflect new or changed events or circumstances. Note that for comparison purposes and for a better understanding of the underlying performance in our presentation today, we will be discussing results excluding hyperinflation accounting in Argentina, which became effective in July 2018. Additional information in connection with the application of Rule IAS 29 can be found in our earnings report. Now, let me turn the call over to our CEO, Martin Ornagian.

Thank you, Iñaki. Hello, everyone, and welcome to today's call. I am pleased to report that the initiatives we have been focusing on since the start of this health crisis contributed again this quarter to deliver a significantly better business and financial performance while further enhancing the equity value of our business. Traffic across our operations continued to recover during the quarter, reaching 10.5 million passengers, up 90% on a sequential basis. Compared to pre-pandemic levels, traffic reached 46% of the nearly 23 million passengers reported in the third quarter of 2019. This better performance was mainly driven by the sustained recovery observed in Armenia, Brazil, Ecuador, and Italy. By contrast, Argentina and Uruguay remain heavily impacted by severe government travel restrictions to contain the spread of the COVID-19 virus during the quarter. However, borders in these two countries were fully open starting November 1st, on the back of the advanced rollout of the vaccination campaigns and warmer weather as we approach the summer season in Latin America. At the same time, cargo activity remained strong, reaching 82% of pre-pandemic levels, contributing to partially mitigate softer traffic volumes. Again, this quarter, Uruguay and Italy outpaced 2019 cargo volume levels. These positive trends follow through our financial results, with revenues ex-hypric more than doubling year on year to nearly $170 million and up 38% sequentially, reaching 55% of the third quarter of 2019 levels. The successful cost reduction program implemented at the onset of the pandemic Together with our continued focus on strict expense controls and cash preservation also contributed to higher profitability. Comparable adjusted EBITDA improved to $38 million from the $7 million reported in the prior quarter and the $19 million loss reported in the third quarter of 2020. Importantly, we achieved positive adjusted EBITDA in all countries of operations with the exception of Peru. We have also achieved two important milestones of our strategy. First, we've taken important steps to strengthen the company's liquidity position and improve the debt profile. Between September and November in Argentina and Uruguay, we refinanced a combined $425 million in existing debt. We also obtained new funding for a total of $179 million in these two countries. Second, we obtained a 20-year extension of our Carrasco International Airport concession in Uruguay, which also included the addition of six regional airports. This not only reinforces our leadership position in Uruguay, but also creates value and strengthens our business. Jorge will go over this advance in more detail shortly. Moving on to slide four. Governments continue to gradually lower travel bans across most markets. While commercial operations were allowed across our airports, total traffic for the quarter was still impacted by high restrictions for international travel in Argentina, Uruguay, and Italy. Beginning this month, both Argentina and Uruguay opened their borders to international travel with certain requirements as reflected by the green boxes on this slide. By contrast, Italy increased travel restrictions for certain countries given a spike in COVID cases after the summer season. Looking at performance and restrictions by country during the third quarter. Starting with Argentina, domestic traffic remained open throughout the quarter while borders remained closed to foreigners through October 31st. the daily quota for international arriving passengers established by the government to contain the spread of the virus remained capped at 1,700 for almost the entire quarter, causing passenger traffic to be 70% below the third quarter of 2019 levels. Despite improving 38 times year on year, with 78% of the population with at least one dose and 59% fully vaccinated and improved sanitary conditions since November 1st, borders are open to all fully vaccinated passengers who also present a negative PCR test. While Uruguay posted a traffic increase of over four times year-on-year, this was still 75% below third quarter of 2019 levels impacted by the closure of borders to non-resident foreigners. Starting November, borders reopened to all foreigners presenting a full vaccination certificate and a negative COVID test. Passage near traffic in Italy was up over 85% year-on-year, reaching 50% of the third quarter of 2019 levels and posting a significant sequential improvement boosted by the summer season, with domestic traffic reaching nearly 86% of pre-pandemic levels. In Brazil, traffic more than doubled year on year as health conditions improved, reaching 74% of the passenger levels of the corresponding quarter in 2019. Domestic travel is not restricted, while international travel is now fully open, only subject to presenting a negative COVID test prior to boarding. Traffic in Armenia continued to post has strong performance, up nearly nine times year-on-year, reaching over 84% of the third quarter of 2019 levels, benefiting from the opening of the Russian borders to foreigners earlier in the year. Lastly, Ecuador maintained the growth trend with passenger traffic improving 4.1 times year-on-year and reaching 67% of the third quarter of 2019 levels. supported mainly by travel to the U.S. and Panama, which is actually above 2019 traffic levels. Domestic and international travel are not subject to any restrictions, although certain requirements apply for international passengers upon arrival. Taking a deeper look at passenger traffic trends on slide 5, the recovery that started last May on the back of advances in the vaccination rollout and lower travel restrictions continued throughout the quarter. Traffic in July, August, and September improved to 40%, 47%, and 52% of the traffic levels achieved in the respective months of 2019. By country of operations, Armenia delivered the fastest recovery against pre-pandemic levels. Brazil and Ecuador posted a significant rebound, while Italy benefited from the boost in demand during the summer season. By contrast, Argentina and Uruguay, which remained affected by the prolonged government restrictions in place through October, showed the slowest recovery, although posting a consistent pickup month over month. The recovery continued into October with passenger traffic reaching 58% of the corresponding month of 2019. This momentum is anticipated to strengthen in our main LATAM markets as we enter the summer season on the back of the recently relaxed travel ban, better sanitary conditions and pent-up demand. Now, turning to slide six, cargo operations continued the recovery trend across the board with volumes reaching 81 percent of third quarter of 2019 levels. This good performance was driven by the majority of our countries of operation. Uruguay and Italy stand out this quarter, with volumes exceeding the levels achieved in the third quarter of 2019, when Argentina and Ecuador reached 80% of pre-pandemic levels. I will now hand off the call to Jorge, who will review our financial results. Please, Jorge, go ahead.