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 (Unaudited Preliminary Results)
Reporting Period: First Quarter 2009 (Ended March 31, 2009)
Reporting Date: April 28, 2009
Business Overview: OMA operates 13 international airports in central and northern Mexico. The quarter was characterized by a global economic recession, peso depreciation, and a reduction in available seats due to the cessation of four Mexican airlines and the departure of some U.S. carriers.

Key Financial Metrics

Note: Exchange rate as of March 31, 2009 was Ps. 14.3855 per US$.

Material Changes vs. Prior Period

• Traffic Contraction: Total passenger traffic fell 18.7% due to reduced airline capacity (exit of Aerocalifornia, Avolar, Aladia, Alma) and economic recession. Domestic traffic dropped 18.2%; international traffic dropped 20.6%.
• Revenue Resilience: Despite the traffic decline, total revenues only fell 3.2%. This was achieved through revenue per passenger increases (Aeronautical +18.3%; Non-aeronautical +22.1%) driven by commercial initiatives and peso depreciation benefits on international charges.
• Cost Structure: Total costs and operating expenses increased 2.8%, primarily driven by a 16.2% rise in depreciation and amortization due to higher investment levels. General and administrative expenses decreased 7.2% due to cost controls.
• Net Income Volatility: The 45% drop in net income was significantly influenced by a one-time gain of Ps. 104.2 million in Q1 2008 (cancellation of deferred profit sharing) that did not recur. Adjusted for this item, net income declined 10.4%.

Outlook, Risks, and Management Commentary

• Management Commentary: Management highlighted that initiatives to increase revenues and control costs partially offset the negative impact of traffic reduction. EBITDA margins were maintained at levels similar to Q1 2008.
• Capital Projects: Significant progress on Master Development Plan (MDP) investments, including Terminal B at Monterrey (91.3% complete) and a hotel at Mexico City International Airport (91.0% complete, scheduled to open June 2009).
• Liquidity and Financing: OMA generated Ps. 200.4 million in cash from bank borrowings under a new Ps. 500 million credit facility. Financing activities also included Ps. 107.2 million in dividend payments and Ps. 17.9 million in share repurchases.
• Dividends and Buybacks: The Annual Shareholders' Meeting declared a cash dividend of Ps. 400 million (Ps. 0.25/share) to be paid in four installments starting July 2009. Authorization was granted for up to Ps. 400 million in share repurchases.
• Risks: Continued global economic recession, potential further reductions in airline frequencies, and currency fluctuations remain key risks. The filing includes standard forward-looking statement disclaimers.

Investor Verification Checklist

• Traffic Recovery: Verify if the exit of four major Mexican airlines and U.S. carrier reductions will stabilize or if further capacity cuts are expected.
• EBITDA Margin Consistency: Reconcile the discrepancy in the text between the "Highlights" section (55.9% margin) and the "Adjusted EBITDA" section (57.2% margin).
• Debt Servicing: Confirm the terms and interest rates of the new Ps. 500 million credit facility utilized for capital expenditures.
• Non-Aeronautical Growth: Assess the sustainability of the 22.1% increase in non-aeronautical revenue per passenger as traffic volumes remain depressed.
• Project Completion: Monitor the June 2009 start date for the Mexico City hotel and the final completion of Monterrey Terminal B to ensure capital expenditure timelines are met.