Aeroports De Paris Sa

Good morning and welcome to Group ADP First Quarter 2025 Revenue Conference Call. Today's call will be recorded and if you want to ask a question at the end of the presentation, please press star 1 on your telephone keypad. Please limit yourself to two questions per analyst. I now hand over the call to Cecile Kembo, Head of Investor Relations. Please go ahead.

Thank you and good morning, everyone. Thank you for being with us this morning for Q1 2025 revenue publication. I am here with Christelle de Robillard, our new CFO, who will go through some prepared remarks before taking your questions. So one or two panelists, please, to allow for a greater number of you to dialogue with Christelle. And you can always queue up again if you have additional topics you'd like to discuss. Before we start, I remind you that 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 in our press release and on slide 34 of our presentation. And with that, let me hand it over to Christelle.

Thank you, Cécile, and good morning, everyone. I am pleased to be speaking with you today as the new CFO of Group ADP. Some of you may recall that this is actually a return for me as I previously spent several years within the group before taking on other responsibilities. It's an honor to rejoin ADP at such a pivotal time for the company and I'm looking forward to working closely with the teams and with all of you as we continue to execute on our strategic priorities. Let me kick off this presentation with a few highlights from the quarter on slide 3. You can see on the left side the key operational indicators and revenue for the first quarter, which is reaching close to 1.5 billion euros, up 12.2% compared to Q1 2024. This is an encouraging start to the year, and we confirm our four-year outlook. In terms of strategic progress, We launched the CDGEVU consultation of Paris Charles de Gaulle Airport, paving the way for the next economic regulation agreement, which remains on track for a year-round proposal. The new management structure is now in place, driving faster and more agile decision-making. We continue to actively manage our debt profile through bonded issuance and repurchase operations closed at the beginning of March. Internationally, we secured the daily tariff revision for 2025-2029, opened entirely a new capacity extension, and completed the refinancing of the new concession. All strong steps supporting the group's long-term positioning. Now, a few words about the new general management around the chairman and CEO to strengthen alignment and accelerate decision-making. It embodies our strategic priorities as we enter a new phase of development in Paris, focused on decarbonisation, operational excellence and quality of service. It also supports our economic model, combining a disciplined approach to external growth. This new structure recognises the growing role of hospitality within the group and accompanies a broader transformation in how we operate, simpler and more agile. Moving on to slide five, with the latest Skytrax ranking. Eight airports of the groups are now in the top 100, and Paris CDG continues to be the best airport in Europe for the fourth year in a row. It's the day-to-day commitment of our teams, their ability to innovate and reinvent themselves, that enable our airports around the world to meet passenger expectations. This shows We have everything it takes to become a global reference in airport hospitality, and we are fully committed to this ambition. Reflecting this ambition, La Rue Parisienne was opened recently in Orly 4, serving international passengers with our X-Time lifestyle offering. The area will include six new bars and restaurants by the end of the year, as well as eight additional shops planned for 2026 to keep growing our retail business going forward. In Turkey, TAV Airport recently commissioned the first phase of capacity expansion in Antalya, with a nominal capacity increased to 65 million passengers compared to 35 million previously. Antalya is among the most popular tourism destinations in the Mediterranean Basin, and this expansion will bring significant value. Moving on to slide 9, with overall traffic evolution. Group traffic is 6.7% higher than in Q1 2024, with stronger growth in international airports. In Paris, traffic evolved in line with our expectations, up 4.5% in Q1 2025, reflecting several elements. First one is a favorable base effect created by the four-flight air traffic management system, which led to reduction in flight schedules from January to February 2024. This is partially offset in 2025 by similar flight reduction, but to a lesser extent, and also by the absence of a leap day compared with February 2024. Excluding these effects, traffic in Q1 2025 grew around 2.6% compared to Q1 2024. In addition, the traffic in the month of March was affected by two calendar effects, which are more difficult to quantify precisely. The month of Ramadan, which took place entirely in March this year, had an unfavorable impact on 2025 passenger traffic with certain destinations. This materialized into lower load factors. In contrast, the Easter period had boosted traffic in March 2024, resulting in an unfavorable base effect. All in all, traffic recorded so far and the known capacities are consistent with our traffic growth assumptions for 2025, between 2.5% and 4% compared to 2024. Let's now move on to slide 10, with a focus on X-Time Paris 10-per-packs reaching 33.4 euros, up 2.2% versus Q1 2024. This 2% growth is very solid considering the headwinds we're facing, including the rebasing effect linked to the reopening of Terminal 2 AC since May 2024, and normalization of advertising activities after an outstanding year with the Olympics in 2024. Sales in shops particularly in the luxury segment, keep growing steadily. Going forward, the current uncertain macroeconomic context leads us to keep an unchanged cautious stance and we continue to expect spend-pair-packs in 2025 to be 4% to 6% higher than in 2023. Moving on to slide 11. Revenue reached €1.5 billion in Q1 2025, up plus 12% versus last year. Aviation revenue is up 33 million euros. The segment is growing plus 7%, reflecting the combination of traffic growth in Paris and the regulated tariff increase of plus 4.5% on average applied since April 2024. Keep also in mind that another plus 4.5% tariff increase applies from 1st April 2025. The retail and services revenue is growing 63 million euros, driven by solid growth in Spencer packs and traffic, and including a positive scope effect from the acquisition of PS and Paris Experience Group in Q3 last year, but also with classification of SDA Croatia into the segment. Real estate revenue segment is up 7 million euros, with new assets and rent indexation closing. Abroad, Taverport is growing 57 million euros, up 18% compared to Q1 2024, boosted by price adjustment as well as helped by the new commercial areas in Almaty following the opening of extension last June. AIG revenue is up 13 million euros, or 23%, showing signs of recovery in spite of the geopolitical context. This early start to the year allows us to confirm our outlook. We continue to expect traffic in Paris to grow between 2.5 to 4% compared to 2024. We confirm as well our target to deliver at least 7% annual growth in a big DA. Our capex guidance is maintained with investment expected to a maximum of 1.4 billion euros at group level of which up to 1 billion euros in 2025 for ADP SA. Before opening the line for Q&A, let me say a few words about the progress made in Q1 on the front of our strategic projects in Paris. Starting with the CDG&VU consultation launched in early April. Territorial dialogue is a priority for ADP. As we did last year for Orly, we launched a voluntary public consultation on our vision for the future of CDG Airport. This ambitious vision aims to meet evolving traffic demands while driving the sustainable transformation of the airport platform. It is structured around two time horizons, 10 and 25 years, to ensure failed, scalable and decarbonized developments. Built on five pillars, from intermodality and infrastructure to cargo, energy and real estate, CDG 2050 set the pace for a flexible, inclusive and sustainable airport model. The consultation will run until the summer and we will draw conclusions from this consultation by fall. Final words on the preparation of our next economic regulation agreement on slide 15. We are fully on track to submit our proposal by year-end, and we are doing so with confidence and momentum. The regulatory environment is now much clearer. The authorised level of regulated work, estimated by the regulator, is directionally going up. Two legal changes, one implemented last year and one to be enacted very soon, are game-changers. Tariff moderation is now to be assessed. over the full period of the era, not year by year. And the bill provides that an era itself could run up to 10 years, giving us the visibility we need for our industrial project. The only remaining milestone is the cost allocation review, and it will be concluded as part of the next tariff approval process. On our side, we're preparing an era designed to meet the expectation of full stakeholders. We are shaping it as a balanced, forward-looking framework, and we are doing it with determination and a clear long-term vision. And with that, let's open the line for the Q&A.