ASR

Business Context and Reporting Period

Company: Southeast Airport Group (Grupo Aeroportuario del Sureste, S.A. de C.V.)
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Date: November 10, 2005
Reporting Period: October 2005 (Month-over-Month comparison with October 2004)
Context: The filing details total passenger traffic for October 2005, highlighting the severe operational and traffic disruptions caused by Hurricane Wilma, which struck the region in late October 2005. The company operates nine airports in southeastern Mexico.

Key Financial and Operational Metrics

Passenger Traffic (October 2005 vs. October 2004):

• Total ASUR Traffic: 785,585 passengers (down 19.8% from 980,079).
• Cancun: 451,209 passengers (down 33.1%).
• Cozumel: 15,469 passengers (down 47.7%).
• Merida: 108,754 passengers (up 43.7%).
• Other Airports: Huatulco (+11.8%), Minatitlan (+22.2%), Tapachula (+29.0%), Villahermosa (+4.2%).

The filing text does not provide specific revenue, profit, cash flow, margin, debt, or liquidity figures. It focuses exclusively on operational passenger traffic statistics.

Material Changes and Operational Impact

Hurricane Wilma Impact (October 22-31):

• Closure: Cancun airport closed Oct 21 (6pm) to Oct 24 (8am); Cozumel closed Oct 21 (3pm) to Oct 23 (9am).
• Traffic Drop: Total traffic for the period Oct 22-31 fell 53.4% compared to the same period in 2004.
• Cancun Specifics: Traffic dropped 86.7% during the post-hurricane period. Only one of two terminals is currently operational due to damage to Terminal 1.
• Cozumel Specifics: Traffic dropped 81.6% during the post-hurricane period. Damage includes ceilings, air-conditioning, windows, and electrical wiring.

Merida airport traffic increased 112.4% during the post-hurricane period (Oct 22-31) due to the evacuation of 21,997 tourists from the Cancun region.

Traffic in the first 21 days of October was down only 1.2% year-over-year. Management attributes slight declines in Cancun and Cozumel during this period to reduced hotel availability from Hurricane Emily (July 2005).

Outlook, Risks, and Management Commentary

Recovery Timeline:

As of the filing date, ASUR cannot estimate when operations at Cancun and Cozumel will return to normal. The Tourism Authority has not issued estimates on the number of hotel rooms damaged by Hurricane Wilma or their expected reopening dates.

Financial Guidance:

Management explicitly states it cannot estimate the impact of these events on passenger traffic for the fourth quarter of 2005 or the fiscal year 2006.

Risks and Contingencies:

• Infrastructure Damage: Significant physical damage to airport terminals and regional hotel infrastructure.
• Accommodation Shortage: Previous damage from Hurricane Emily had not fully recovered before Hurricane Wilma struck, compounding the reduction in available hotel rooms.
• Uncertainty: High uncertainty regarding the duration of operational disruptions and the timeline for tourism recovery.

Key Facts for Investor Verification

• Revenue Impact: Verify the correlation between the 19.8% drop in passenger traffic and the company's Q4 2005 revenue guidance, noting the explicit lack of current estimates.
• Terminal Capacity: Confirm the operational status of Cancun Terminal 1 and the timeline for full restoration of capacity.
• Hotel Recovery: Monitor updates from the Municipal Tourism Authority regarding the number of hotel rooms damaged by Hurricane Wilma and their reopening schedule.
• Insurance Coverage: Review the company's insurance policies to determine coverage for business interruption and physical damage to airport infrastructure.
• Competitive Landscape: Assess if the diversion of traffic to Merida is a temporary evacuation measure or a longer-term shift in regional travel patterns.