Aena Sme S.A Unsp/Adr

Good afternoon, everybody, and welcome to our nine-month results presentation for year 2023. This is Ignacio Castejón speaking. It's a real pleasure being with all of you today. Our chairman and CEO, Mauricio Lucena, will host the call together with Carlos Gallego, head of IR, and myself. Jose Leo sends his apologies for not being present at the call today with us, but he's on sick leave at this moment in time. Now I will give the floor to Mauricio Lucena. Thank you, Mauricio.

Thank you, Ignacio. Good afternoon, everybody. Thank you for joining us today. I will start as usual with the key highlights, and then I will give the floor again to Ignacio Castejón. And at the end, as always, we will have the opportunity to discuss whatever issue you want. in our Q&A session. Okay, I will start with traffic. As you can see on the documents that we sent you, the first nine months of 2023 have performed very well. IANA group traffic increased by 17.4%. up to 240 million passengers, which represents a recovery of 100.8% of the traffic in the same months of 2019. Concretely, in Spain, the traffic increased up to 216.6 million passengers, which is equivalent to 101.3% of the traffic in 2019. And as usual, in the past two, two and a half years, domestic traffic performed very strongly, up to 107.9% recouped versus 2019. And international traffic is almost fully recovered. It reached 98.3% of the traffic in 2019. So we can clearly state that The traffic has fully come back and we have completely overcome the very deep crisis of the pandemic. You know as well that in the past days, the airlines have released They're scheduling for the 2023-24 winter season, and I think that the figures are very good figures. Concretely, they have scheduled 126.6 million seats, which represents an increase of 15.1% percent compared with the 2022-23 winter season. And so it means that I think that we can say naturally then that we expect to close the current year 2023 at around 280 million passengers in Spain, which would represent 102% of the traffic of 2019. And you know as well that this percentage of traffic in relative 2019 terms is within the guidance that we provided for the full 2023 at the beginning of the year. In London, Luton Airport, things have also performed quite well, but you know that the recovery, I would say globally in the UK is a little bit delayed compared with Spain. And it means that in the nine first months of the current year, the traffic in London reached 90% or 90% of the traffic of 2019. In Brazil, and I'm now referring to the Northeast airports of IANA in Brazil. The recovery was better, much better than in the UK, and it reached an equivalent 104.9% of the traffic in 2019. And if we look to the future, I think that we are positive. I would say that we are optimistic, but at the same time, we remain prudent. because we cannot forget the potential headwinds. And I would like to refer to the wars in Ukraine and the war in Gaza, the higher costs of living and potential aircraft deliveries taking longer than expected. All in all, as I say, we remain sanguine and we think that the end of the year will be a very good end of the year for AENA and we are also optimistic referring to 2024. Now I move to financials. You know that ordinary revenue grew by 20.1% if we compare these first nine months of the current year with the same period of 2022. And the ordinary revenue stood at 3.7 billion euros. I would like to highlight aeronautical revenue, which increased by 16.6%. Commercial revenue, which increased by 23.7%. real estate revenue by 17.7%. And finally, international activity, which grew by 29.1%. And at present, our international activity is contributing 7.1% of total EBITDA of the group, which is, I would say, a significant figure, especially if we take into account that it does not still count the future contribution of Congonhas and the other 10 airports around Congonhas. On the cost side, I would like to underline that the total operating expenses They increased 5.1% compared with 2022, and other operating expenses grew by 3%. This evolution simply reflects the traffic growth, the full reopening of terminals and airport spaces, and, of course, inflation and lower electricity prices. The EBITDA for the period came at a noteworthy 2.1 billion euros, and the EBITDA margin closed at a relevant 55.9%. For the full 2023, we prudently expect a consolidated EBITDA above 2.7 billion euros, and the net profit increased by 71.4%, reaching 1.1 billion euros, confirming the prospects for an attractive dividend payment in 2024, which you know is, let's say, a clear priority always for AENA, its management, and its boards. The traffic growth, the commercial performance, the lower electricity bill, and the financial results are the main reasons that explain the performance of both the EBITDA and the net profit. Now I move to the commercial area. The robust growth trend on the commercial business continues. And I would like to highlight, firstly, the commercial sales, which exceeded the 2022 by 15.6%. And secondly, the ratio sales per passenger, which is 14.1% higher than the same for 2019. I would say that a number of reasons are behind this good performance, and I would like to highlight the progressive recovery of the Britons under non-European Union status in duty-free, the reopening of most of the specialty shops, the sales per passenger, and the penetration rates in food and beverage, and the price increases in car parking and VIP lounges. Since November 2021, I think that we have experienced Very good news related to the new contracts. In food and beverage, we have awarded 111 contracts, and the minimum annual warranted rent growth in the period 2023-26 stand at 124%, 35%, 148%, and 157%, respectively, against 2019. And in the case of specialty shops, we have awarded 210 contracts with increases, respectively, of 111%, 24%, 128%, and 136%, which I would honestly say is not bad at all. On the contrary. To end up my comments on the commercial section, in the duty-free business, The variable income of the Canarian and Barcelona lots exceeded the minimum annual warranty rent. And it is the first time ever that two lots simultaneously invoice the variable income instead of the . Now I move to Brazil. We have good news as well. In October, we took the full control of the great airport of Congonhas. I clearly can say that the transition of the airport took place normally and probably which is more relevant for you is that works are underway on the initial CAPEX plans. These CAPEX plans will be presented to the regulator before the end of the year. And the CAPEX solution that we will propose includes increasing the terminal surface upon contact positions, boarding gates, and this is important, it does not contemplate changing the current runway configuration in Congonhas. And let me be clear, I know that there are some concerns among investors and analysts, and I really know very well how AENA works. And I can naturally say that the execution of the CAPEX in Congonhas will be complex, but for us, for AENA, I think it's perfectly viable. So, again, I'm optimistic with the evolution of Congonhas, both in many aspects, operationally, concerning the CAPEX and also financially. We have had in the past months some good news coming from the Brazilian authorities. Firstly, the authorities have granted an increase of capacity from 41 to 44 operations per hour. Secondly, the tariff proposal has been already approved and will come into force this month. Now I will move to financing. In October, as you perfectly know, AENA issued its first ever corporate bond for an amount of 500 million euros. and we closed the deal with an annual we offer yield of 4.314 which is uh i would say not bad for our first time but of course in similar in similar conditions in the future we would expect uh naturally uh little bit decreased in this annual re-offer yield. Concerning security, I again move to another issue. The board of directors awarded the security contracts of 46 airports for five years with a 4.3% discount over the tender price, which again is good news. And finally, You know that we will beat the EBITDA target, excuse me, the net profit target that we set within our strategic plan. I think that we will beat our targets at the end of 2023, I mean the targets that we foresaw for 2024-2025. So we clearly feel compelled to update our financial strategic targets in a capital market day event during the first quarter of 2024 after the 2023 results presentation. This is the end of my presentation, and now I give the floor back to Ignacio Castejón. Thank you very much.

Thank you very much, Mauricio. Hello, everyone, again. As stated by our chairman and CEO, Grupo Evita for this period has grown to 2.1 billion. That is an increase of 38.8%, very close to 2019 levels indeed, with a very high margin of 55.9%. I would say that there are three main drivers behind that increase. Traffic, evolution, commercial trends, and also cost performance, in particular, energy costs, energy prices. Let's have a look at traffic. Our CEO has already talked to us about the recovery versus 2019, that the Spanish network, domestic, from a domestic standpoint, 107.4%, and international, 98.4%. Let's have a look at the international market, because that's our biggest market. If we look at Europe, the recovery is up to 97.6%. Passengers from Italy, France, the Netherlands, Portugal already exceed 2019 levels. And the recovery from the UK market and from Germany, which are our two largest markets, already sits at 93.5% and 89.1% respectively. I would like to stop one sec in the long haul market. This market, except for Asia, is already above 2019 levels. If we look at South America, that is at 108. North America, 101. And Africa, 122%. So long-haul markets are already there. We released the winter scale earlier this week. What we are expecting might happen is significant growth in Europe, plus 19%, 19%. with the UK and Germany growing circa 20% in number of seeds. It's also worthwhile mentioning the expected growth for the USA, plus 27%, and in Asia, plus 257%. As mentioned by our CEO and chairman, there might be headwinds, and also the winter scale is subject to attrition in the following months. But as of today, those are the levels of increases that we are expecting. I also refer to the commercial trends, to the commercial performance as the second reason for the BIDDA growth. We have already discussed the increase in rentals, the increase in sales, but I would like to stop one sec in an absolute number. This first nine months of this year, sales of our operators, sales of our retailers at AENA have already exceeded 3 billion euros in their activities at AENA. Of course, we can look at the increased duty-free food and beverage rates. The main reason behind those increases is higher penetrations and higher transaction values. We can also stop at specialty shops. We are finally adding more and more spaces after COVID with new concepts. VIP services delivering a very strong growth with very strong margins. Let me finalize these two topics with cost. Costs in this third quarter have followed a very similar pattern to the first six months of the year. We have seen some increases and also some material reductions in the cost of energies. Those increases have been lower than in the first six months. Basically, the first six months were affected because of Omicron in 2022, and that's why in June 2023, that's one of the reasons why you saw those increases, those higher than in September of this quarter. Energy costs. The main reason, the main driver behind that reduction is basically energy prices, as you know. The average cost of energy megawatt per hour was 167 last year, and what we are anticipating for this year, for 2023, is 95 euros. Let me end my short presentation with a couple of further points. Increasing net income. As highlighted by Maurici, there has been an increase of 71.5%. 4%, very close to 2019 levels and above 1 billion. The main reason is EBITDA growth, but also the performance from a financial standpoint of our financial results, contributing zero euros, therefore not affecting the P&L. And finally, I would also like to confirm that from a leverage standpoint, net debt to EBITDA ratio, we are already below 2019 levels. That means that the company, through the cash generation that you have seen this time, nine months, have been able to leverage naturally further to the performance of our businesses. I think that's all from our side. So we'll be happy to start the Q&A session in the rest of this meeting.