Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. Q3 FY2025 earnings call

Passenger Traffic

• Domestic passenger traffic grew by 7%, led by Monterrey Airport on routes to Mexico City, Toluca, Bajio, etc., adding over 300,000 passengers (68% of domestic growth).
• International passenger traffic increased by 11%, mainly driven by Monterrey to San Francisco, San Luis Potosi, and Tampico to Dallas, adding over 47,000 passengers (46% of international growth).

Financial Highlights

• Aeronautical revenues up 11%, commercial revenues up 7%, diversification revenues up 8%. Adjusted EBITDA up 9% to MXN 2.7 billion with a 74.8% margin.

Master Development Program

• Submitted proposed Master Development Program for '26-'30 period in June, negotiation with AFAC ongoing, expected final resolution and publication in December, with investment levels similar to previous MDP and max tariff increase in low single digits.

In the third quarter, OMA's passenger traffic totaled 7.6 million passengers, an 8% year-over-year increase. Seat capacity rose 11%. Aeronautical revenues increased 11% with aeronautical revenue per passenger up 3%. Commercial revenues grew 7%, with commercial revenue per passenger at MXN 60, driven by parking, restaurants, VIP lounges, and retail; occupancy rate for commercial space was 96%. Diversification revenues increased 8%, with Industrial Services contributing most due to additional square meters leased and rent increases. Adjusted EBITDA increased 9% to MXN 2.7 billion with a margin of 74.8%. Total capital expenditures in the quarter were MXN 472 million.

• For the rest of 2025, OMA expects overall traffic growth between 7% and 8%.
• For 2026, OMA expects traffic growth in the low to mid-single digits.

• Cost pressures in SG&A and utility costs, including factors like payroll, other costs/expenses, contracted services, minor maintenance, and concession tax, with some pressures related to labor market and inflation uncertainties.

Q: I have one question regarding your traffic expectations maybe for the fourth quarter and maybe your early thoughts on 2026, taking into account the World Cup.

A: Yes. We're looking for the rest of the year to finish in our traffic overall for the year between 7% and 8% growth. And our expectation at this point in time for next year, it's traffic to be in the low to mid-single digits for next year growth.

Q: Commercial revenue per pass declined this quarter, the first contraction since early 2023. Could you elaborate on the main drivers behind this softness? And how do you plan to reaccelerate this area of growth?

A: Enrique, so yes, commercial revenue per passenger mainly reflects -- in the quarter reflects the impact of onetime revenues recorded in the previous year. And in the following quarters, we expect commercial revenues per passengers to gradually increase in line with inflation from current levels.

Q: SG&A and utility costs rose this quarter, eroding margins despite strong top line growth. Do you view these cost pressures as temporary? Or should we expect a structurally higher cost base heading into 2026?

A: So yes, as we mentioned, there are some specific line items that are facing some pressures like cleaning and security, where the total level of cost in the following quarters should be similar to the level of cost that we are facing right now. However, we do have started to analyze different alternatives to continue maintaining cost at check, and it's part of the history of the company to be very cost conscious, and we expect pressures not to be permanent.

Q: A quick question on capital allocation. First, for the next MDP, I think you have mentioned that almost all the capital will go to Monterrey. It will be focused on, perhaps, increasing the capacity of the airport or developing more the commercial spaces, the commercial portion of the business? And my second question, are you seeking or have you considered expanding OMA's portfolio towards outside Mexico?

A: Yes. Regarding the last part, we're always looking for opportunities to expand internationally. At this point in time, we don't have a concrete transaction that we could share. In terms of the MDP, it's around half of the MDP will be allocated to Monterrey, given that half of the traffic is allocated in Monterrey. We're looking to expand in most of -- in capacity that will generate commercial opportunities as well. There's pavement, there's technology, there's environmental and sustainability projects as well.