OMAB

Business Context and Reporting Period

Company: Central North Airport Group (Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., or OMA)
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Fourth Quarter and Full Year 2009 (Unaudited, Preliminary)
Release Date: February 24, 2010
Business Overview: OMA operates 13 international airports in central and northern Mexico, including major hubs in Monterrey, Acapulco, and Mazatlán, plus commercial operations and a hotel at Mexico City's Terminal 2.

Key Financial Metrics (4Q09)

Full Year 2009 Summary: Revenues of Ps. 1,896.3 million; Adjusted EBITDA of Ps. 971.3 million; Net Income of Ps. 469.5 million. Operating cash flow was Ps. 436.1 million. Total debt as of Dec 31, 2009, was Ps. 673.6 million. Cash and cash equivalents balance was Ps. 267.7 million.

Material Changes vs. Prior Period

• Traffic Decline: Total passenger traffic decreased 11.1% to 2.8 million in 4Q09, driven by the economic crisis, the suspension of Aviacsa (since July 2009), and the exit of airlines Alma and Aladia. International traffic fell 10.6%, while domestic traffic fell 11.1%.
• Revenue Resilience: Despite traffic declines, total revenues were nearly flat (-0.8%) due to a 7.9% increase in aeronautical revenue per passenger and a 27.6% increase in non-aeronautical revenue per passenger.
• Cost Increases: Operating costs rose 8.7% primarily due to the inclusion of the NH Mexico City Airport Terminal 2 Hotel operations (Ps. 24.6 million in costs). Excluding the hotel, costs decreased 2.4%.
• Net Income Surge: Net income increased 246.5% year-over-year, not due to operational growth, but primarily from a Ps. 46.1 million tax credit (reversal of prior provisions) and comprehensive financial income (exchange gains).
• Cargo Recovery: Air cargo volumes increased 13.5%, showing significant recovery compared to passenger traffic.

Outlook, Risks, and Management Commentary

• Strategy: Management focused on maintaining aeronautical revenues, expanding non-aeronautical offerings (11 new commercial operations opened), and strict cost control.
• Hotel Operations: The NH Terminal 2 Hotel had its first full quarter of operations. December occupancy was 32.5% with a RevPAR of Ps. 366.5. Management is focusing on airline crew accommodations and group events.
• Tax Law Changes: New Mexican tax law effective Jan 1, 2010, increases the income tax rate to 30% for 2010-2012. This may impact future cash flows, though OMA does not pay tax on a consolidated basis.
• Liquidity and Financing: On Feb 3, 2010, long-term bank credit facilities were increased from Ps. 500 million to Ps. 700 million to fund working capital and investments. No exposure to financial derivatives.
• Risks: Continued economic recession, airline suspensions, and potential volatility in passenger traffic remain key risks. Forward-looking statements are subject to uncertainties beyond OMA's control.

Investor Verification Checklist

• Tax Provision Reversal: Verify the sustainability of the Ps. 46.1 million tax credit driving the 246.5% net income increase; this is a non-recurring item.
• Hotel Impact: Assess the long-term profitability of the NH Terminal 2 Hotel, which currently adds significant costs (Ps. 24.6 million) with modest revenue (Ps. 11.8 million).
• Traffic Trends: Monitor the impact of the Aviacsa suspension and the economic recovery on passenger volumes, which are still down double-digits.
• Debt and Liquidity: Confirm the utilization of the increased Ps. 700 million credit facility and the company's ability to service Ps. 673.6 million in total debt.
• Regulatory Changes: Evaluate the impact of the new 30% corporate tax rate on future cash flows and dividend capacity.