Aeroports De Paris Sa

Welcome to the Group ADP 2023 9-Month Revenue Call. The conference is now open, and I leave the floor to Cécile Combo, Head of Investor Relations.

Thank you, and good evening, everyone. I am Cécile Combo, Head of Investor Relations of Group ADP, and with me are Philippe Pascal, our CFO, and Christelle Jacques, my Deputy CFO. Philippe will go through some prepared remarks before taking your questions with Christelle and in order to allow as many of you as possible to dialogue with the management, I would like to kindly ask you please to limit your questions to one or two each time you take the line and of course you can queue again if you have additional questions. As a reminder, Certain information to be discussed on today's call is forward-looking and is subject to risks and uncertainties that could cause actual results to differ materially. For this, I refer you to the disclaimer statement included at the end of our press release and on slide 29 of our presentation. And with that, let me hand it over to Philippe.

So thank you, Cecile, and good evening everyone. Let's jump directly to slide two with the highlights. Our consolidated revenue is standing at 4.1 billion euros for the first nine months, up 22% compared to 2022. We continue to see solid dynamics in all businesses and we fully confirm our targets for 2023. As expected, our airports have been busy this summer. Retail's performance continues to be strong as well. We remain focused on preparing to host the Paris Olympics in 2024 and want the industrial and environmental transformation undertaken with our 2025 Pioneer Strategy Roadmap. Regarding the most recent developments, So, as you know, we communicated the estimated impact of the new tax projected by the French government. As indicated for the regulated scope, a part of the tax revenue is being included in the business plan that we will base our next regulated tariff proposal. This is a work in progress. and we expect to submit tariffs to the regulator in the coming weeks. Regarding the text of the bill itself and the parameters of the tax, discussion and amendment process continue at the Senate and could still result in change to the text. The law must be voted and promulgated by the end of December the latest. Slide three, we can see overall traffic evolution, which is in line with our expectation. Traffic is growing at a faster pace in international asset, plus 26% compared to the last year, leading to recovery of 101% against 2019. At group level, Traffic is growing to plus 24% and recovery stands at 97.9% in the first nine months. In Paris, we welcomed close to 76 million passengers since the beginning of the year, up 18% compared to nine months 2022. This represents a recovery of 91.4% versus nine months 2019. In Q3, traffic was up 8% compared to Q3 2022. On this basis, we are confident to end up the year with a recovery level in the upper part of our assumption, up to 93%. in Paris. Continue to focus on Paris on slide four, traffic with mainland France turned at 76% of 2019. This is in line with our expectation and reflects the closure of several domestic routes compared to before COVID crisis. Going forward, we expect low growth in domestic traffic. Internal traffic, which is the most accretive, stood at 93% of 2019, showing improvement compared to June, as expected, driven notably by the acceleration of traffic with China during the third quarter. In Q3, traffic with China reached a recovery level of 37% compared to Q3 2019, We expect a further step up at the end of this year with a projected winter schedule totaling 48 weekly flights for the end of November to be compared to 34 weekly flights currently and 93 in 2019. Slide 5, looking at retail business in Paris, sales per pax was 29.7 euros in the first nine months, with 30.2 euros in Q3. That is 3.6 euros more than last year, reflecting the positive impact of greater and improved offering of our X-Time strategy, especially with the reopening of Terminal 1, new international area. In terms of rollout of X-Time, the latest development is good news. this summer of the green light received from the French Competition Authority for the implementation of the partnership with SSP in Ex-Time Food and Beverage. Going forward, as commented in previous quarter, we expect SPP to experience more pressure due to the staging and upgrading works in Terminal 2E Olki that we will span over the next two years. Next year, we will also have the reopening of Terminal 2E and 2C that might slow FPP growth down. Accordingly, our sales per pack target for the moment is 29.5 euros in 2025 and remains valid. Slide 6. We have a specific focus on our two main international assets, TAV and GMR. As a reminder, TAV numbers are fully consolidated in our account, and GMR airport results are equity accounting. As you can see on the left side, TAV's traffic recovery stands at 97.8% of 2019 level. Thierry's international assets performed well, with several having reached full recovery, especially Almaty, standing at 147% of 2019 traffic level. Thierry's airport in Turkey, we have a slower recovery on their domestic traffic, but there is offset by international traffic reaching above 2019 traffic levels. This summer, Thierry also conducted the sale of a part of its stake in Medina airport, The net gain from this transaction is estimated at 38 million euros in the net result attributable to the group. The airport remains consolidated under the equity method. On the right side of the slide, GMR airport traffic stands at 107% recovery. In India airport, strong recovery is driven both by domestic traffic standing at 111% of 2019 level, but also for international traffic now nearly at the full recovery. Regarding the merger between GEMA Infrastructure Limited and GEMA Airport, the merger application has been fully approved by the Indian Stock Exchange and is now being reviewed by the National Company Law Tribunal. According to the schedule, we expect the completion of the merger during the first half of 2024. So globally, all is under control. Moving on slide seven, our revenue reached 4.1 billion euros for the first nine months, up 22% with revenue from all segments increasing. In Paris, Continued traffic recovery drove aviation revenue up 18%, as well as retail and services revenue up 27%, supported by consistently strong ex-time sales per pack. Revenue of real estate activity in Paris is up 8%, thanks to the additional rents from assets returns in full ownership in 2022 and new indexation in terms of rent. In the international business, revenue is up 27%, mainly driven by the nearly full recovery of TAV Airport, but also by the strong dynamic of all the services companies of TAV, especially in ground handling, lunges and food and beverage. To conclude, let's move to slide nine. We can see our assumption, our traffic assumption and financial guidance for 2023. We can confirm all our guidance and assumption. We continue to expect traffic in Paris up to 93% of 2019. And for the group, between 95% to 105% of the 2019 traffic. For EBITDA guidance, we expect an EBITDA between 32% and 33% of the revenue. Dividend policy, still the same, 60% of EPS as a payout guidance. with a floor of 3 euros per share. And for investment, we expect around 1.3 billion euros per year on average, between 23 and 25, on which 900 million euros are just for EDP mother companies. Going forward, we continue to fully focus on our 2025 Pioneer Strategy roadmap, contributing to the ecological transition of our sector. We are also working on our future capacity management plan for Paris. And with a shorter perspective, we, of course, continue to get ready for the Olympics next year. With that, I propose now to go directly to the Q&A. Thank you very much.