Business Context and Reporting Period
Company: Grupo Aeroportuario del Sureste, S.A. de C.V. (ASUR)
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Second Quarter (2Q) and Six-Month Period (1H) ended June 30, 2002.
Business Overview: ASUR is the first privatized airport group in Mexico, operating nine airports in the southeast, including Cancun, Cozumel, and Merida. Financial figures are presented in constant Mexican pesos (Ps.) as of June 30, 2002.
Key Financial Metrics
Second Quarter 2002 (vs. 2Q01)
- Total Revenues: Ps. 302.8 million (Decrease of 5.33%).
- EBITDA: Ps. 168.9 million (Decrease of 14.02%).
- Operating Profit: Ps. 87.3 million (Decrease of 26.48%).
- Net Income: Ps. 58.0 million (Decrease of 27.89%).
- Earnings Per Share (EPS): Ps. 0.1934 (US$ 0.1943 per ADS).
- EBITDA Margin: 55.78% (Down from 61.41%).
- Operating Margin: 28.84% (Down from 37.14%).
Six-Month Period 2002 (vs. 1H01)
- Total Revenues: Ps. 615.9 million (Decrease of 5.99%).
- EBITDA: Ps. 361.7 million (Decrease of 12.75%).
- Operating Profit: Ps. 198.5 million (Decrease of 23.41%).
- Net Income: Ps. 110.6 million (Decrease of 38.38%).
- Earnings Per Share (EPS): Ps. 0.3685 (US$ 0.3701 per ADS).
Liquidity and Balance Sheet (as of June 30, 2002)
- Cash and Cash Equivalents: Ps. 369.3 million (Decreased 54.3% from June 2001).
- Total Assets: Ps. 10.88 billion.
- Shareholders' Equity: Represents 94.95% of total assets.
- Total Liabilities: Represents 5.05% of total assets.
Material Changes vs. Prior Period
Traffic and Revenue Drivers
- Passenger Traffic: Total traffic decreased 7.41% in 2Q02 and 8.14% year-to-date. International traffic fell 9.31% (2Q) and 10.29% (1H), heavily impacted by the September 11, 2001 events. Cozumel was the hardest hit, with total traffic down 23.44%.
- Aeronautical Revenues: Declined 10.15% (2Q) and 10.67% (1H) due to lower traffic volumes.
- Commercial Revenues: Increased significantly by 58.39% (2Q) and 52.18% (1H). Commercial revenue per passenger rose 71.46% to Ps. 13.56, driven by new duty-free and food/beverage outlets in Cancun, Merida, and Cozumel.
Cost Structure
- Cost of Services: Increased 12.68% (2Q) due to higher civil liability insurance premiums post-9/11 and new terrorism coverage.
- Administrative Expenses: Increased 13.95% (2Q) due to wage increases for non-unionized staff and professional fees for development planning.
- Taxation: The company's three-year tax exemption expired on December 31, 2001. Tax payments for 2Q02 were Ps. 42.3 million, with Ps. 15.8 million recorded in results and the remainder deferred as an asset.
Outlook, Risks, and Contingencies
Management Commentary and Outlook
- Holy Week Timing: Management noted that Holy Week (a major travel period) occurred in Q1 this year versus Q2 last year, distorting year-over-year comparisons.
- Huatulco Recovery: The Club Med resort closure impacted Huatulco traffic; the facility is expected to reopen in Q4 2002.
- Investments: Continued capitalization of investments for new areas at the three largest airports.
Risks and Contingencies
- Airline Payment Disputes: Four major Mexican airlines (Aeromexico, Mexicana, Aerolitoral, Aeromar) suspended payment of tariff increases effective June 1, 2001. As of June 30, 2002, Ps. 6.60 million remains unpaid. Additionally, airlines requested an extension of payment terms from 60 to 115 days, resulting in Ps. 21.48 million in delayed payments.
- Exchange Rate Risk: The Mexican peso devalued 10.43% quarter-over-quarter against the U.S. dollar, affecting commercial revenue results when expressed in USD.
- Regulatory Risk: Revenues are subject to maximum rates regulated by the Mexican Ministry of Communications and Transport.
Investor Verification Checklist
- Airline Receivables: Verify the status of the Ps. 28.08 million in disputed or delayed payments from the four major airlines and the likelihood of collection.
- Tax Liability: Confirm the sustainability of the deferred tax asset (Ps. 26.5 million for 2Q) and the impact of the new tax regime on future margins.
- Cash Flow Usage: Investigate the significant outflow in financing activities (Ps. 706.1 million used in 2Q) and the 54.3% drop in cash reserves.
- Commercial Revenue Sustainability: Assess whether the 58% increase in commercial revenue per passenger is sustainable given the decline in total passenger traffic.
- Cozumel Recovery: Monitor traffic recovery at Cozumel, which remains heavily dependent on North American tourism and was severely impacted by 9/11 and airline suspensions.