Passenger traffic up 2.6% with growth of 7.0%
YoY in Argentina, 7.5% in Ecuador, and 10.4% in Armenia partially
offset by declines in other countries of operations
Corporación América Airports S.A. (NYSE: CAAP), (“CAAP”
or the “Company”) the largest private sector airport operator based
on the number of airports under management and the tenth largest
private sector airport operator worldwide based on passenger
traffic, reported today its unaudited, consolidated results for the
three- month period ended March 31, 2019. Financial results are
expressed in millions of U.S. dollars and are prepared in
accordance with International Accounting Standard 34 “Interim
Financial Reporting” (“IAS 34”) as issued by the International
Accounting Standards Board.
Commencing 3Q18, the Company began reporting results of its
Argentinean subsidiaries applying Hyperinflation Accounting, in
accordance to IFRS rule IAS 29 (“IAS 29”), as detailed on Section
“Hyperinflation Accounting in Argentina” on page 18.
First Quarter 2019 Highlights
- Consolidated revenues of
$360.6 million, down 7.8% YoY. Excluding the impact of IFRS
rule IAS 29, revenues declined 4.0% YoY mainly due to lower travel
demand in Argentina reflecting difficult macro conditions and FX
fluctuation in Argentina, Brazil and Italy, partially offset by
revenue growth in Ecuador and Armenia
- Growth across key operating metrics:
- Passenger traffic up 4.0% YoY to
20.4 million
- Cargo volume increased 6.3% to 104.8
thousand tons
- Aircraft movements declined 0.3% to
212.7 thousand
- Operating Income declined 29.9% YoY,
mainly impacted by IAS 29, and the operating margin contracted to
21.3% from 28.0% in 1Q18
- Adjusted EBITDA was
$116.9 million, down 14.5% YoY, with Adjusted EBITDA margin
Ex-IFRIC12 contracting 86 bps to 38.7%
- Ex-IAS 29, Adjusted EBITDA declined
10.8% YoY and Adjusted EBITDA margin Ex-IFRIC12 contracted 61 bps
to 39.0%
CEO Message
Commenting on first quarter 2019 results, Mr. Martín Eurnekian,
CEO of Corporación América Airports, noted: “Our first quarter
results were impacted by the difficult macro conditions in
Argentina, our largest market and to a lesser extent a slowdown in
Brazil and Uruguay. Passenger traffic growth decelerated which
together with significant currency depreciation in Argentina and,
to a lower degree, in Brazil and Italy, resulted in lower revenue
growth. In Argentina, soft consumer demand and sharp FX fluctuation
continued to drive mix-shift to domestic destinations and lower
commercial revenues, particularly when compared to a record quarter
a year ago. In Italy, our commercial initiatives continue to bear
fruit driving sustained growth in local currency revenues, while
Brazil reported a mid-single digit increase in local currency
revenues. As a result, comparable Adjusted EBITDA Ex-IAS29,
excluding one-time items in 1Q18 and construction service margin,
declined 8.3% YoY, while the margin remained stable at 39% during
the period, reflecting better comparable margins in Argentina and
Italy.
As the year progresses, our business is expected to track
generally in line with overall macro trends. Argentina, our key
market, is facing a more difficult macro environment which,
together with the added volatility from this being a Presidential
election year, suggests a more subdued economic recovery towards
year-end. This is expected to weigh on passenger traffic trends and
slow revenue growth. In Brazil, traffic will remain impacted by
airline capacity adjustments and recent reductions in GDP growth
forecasts for the current year. While we face several headwinds
across key markets, we maintain a solid balance sheet that supports
our focus on advancing on our strategy and key capital investment
projects, particularly in Argentina and Italy. Noteworthy, last
April the Italian Ministry of Transportation approved the 2014-2029
Master Plan for Florence's Amerigo Vespucci Airport and we also
extended the concession agreement of the Punta del Este Airport in
Uruguay for a fourteen–year period from 2019 through 2033.”
Operating & Financial
Highlights
(In millions of U.S. dollars, unless
otherwise noted)
1Q18
1Q19 exIAS 29
IAS 29
1Q19 asreported
% Var asreported
% Var exIAS 29
Passenger Traffic (Million Passengers)
19.6 6.9 -
6.9 -65.1%
-65.1% Revenue 390.9
375.2 -14.7
360.6 -7.8% -4.0%
Aeronautical Revenues 204.8 192.3
-7.3 185.0 -9.7%
-6.1% Non-Aeronautical Revenues 186.1
183.0 -7.4 175.6
-5.7% -1.7%
Revenue excluding construction
service 344.3 310.9
-11.1 299.8
-12.9% -9.7% Operating Income
109.6 94.4
-17.6 76.8 -29.9%
-13.9% Operating Margin 28.0%
25.2% 119.6% 21.3%
-673 -288
Net (Loss) / Income Attributable
to Owners of the Parent 26.5
34.8 -4.4 30.4
14.9% 31.4% EPS (US$)
0.17 0.22 -0.03
0.19 11.5% 27.4%
Adjusted
EBITDA 136.8 122.0
-5.1 116.9
-14.5% -10.8% Adjusted EBITDA Margin
35.0% 32.5% -
32.4% -257 -248 Adjusted EBITDA
Margin excluding Construction Service 39.6%
39.0% - 38.7% -86
-61
Net Debt to LTM EBITDA
1.98 - -
2.05 690 -
Note: Non-IFRS figures in historical
dollars are included for comparison purposes.
To obtain the full text of this earnings release and the 1Q19
earnings presentation, please click on the following link:
http://investors.corporacionamericaairports.com/Results-Center
1Q19 EARNINGS CONFERENCE CALL
When: 9:00 a.m. Eastern time, May 21,
2019 Who: Mr. Martín Eurnekian, Chief Executive Officer Mr.
Raúl Francos, Chief Financial Officer Ms. Gimena Albanesi, Head of
Investor Relations Dial-in: 1-888-347-6492 (U.S. domestic);
1-412-317-5258 (international) Webcast:
https://services.choruscall.com/links/caap190521.html
Replay: Participants can access the replay through May 28,
2019 by dialing: 1-877-344-7529 (U.S. domestic) and 1-412-317-0088
(international). Replay ID: 10131633.
Use of Non-IFRS Financial Measures
This announcement includes certain references to Adjusted
EBITDA, Adjusted EBITDA Margin, Adjusted EBITDA excluding
Construction Service and Adjusted EBITDA Margin excluding
Construction service, as well as Net Debt:
Adjusted EBITDA is defined as income for the period
before financial income, financial loss, income tax expense,
depreciation and amortization.
Adjusted EBITDA Margin is calculated by dividing Adjusted
EBITDA by total revenues.
Adjusted EBITDA excluding Construction Service (“Adjusted
EBITDA ex-IFRIC”) is defined as income for the period before
construction services revenue and cost, financial income, financial
loss, income tax expense, depreciation and amortization.
Adjusted EBITDA Margin excluding Construction Service
(“Adjusted EBITDA Margin ex-IFRIC12”) excludes the effect of
IFRIC 12 with respect to the construction or improvements to
concessioned assets and is calculated by dividing Adjusted EBITDA
excluding Construction Service revenue and cost, by total revenues
less Construction service revenue.
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted EBITDA
excluding Construction Service and Adjusted EBITDA Margin excluding
Construction Service are not measures recognized under IFRS and
should not be considered as an alternative to, or more meaningful
than, consolidated net income for the year as determined in
accordance with IFRS or as indicators of our operating performance
from continuing operations. Accordingly, readers are cautioned not
to place undue reliance on this information and should note that
these measures as calculated by the Company, may differ materially
from similarly titled measures reported by other companies. We
believe that the presentation of Adjusted EBITDA and Adjusted
EBITDA excluding Construction Service enhances an investor’s
understanding of our performance and are useful for investors to
assess our operating performance by excluding certain items that we
believe are not representative of our core business. In addition,
Adjusted EBITDA and Adjusted EBITDA excluding Construction Service
are useful because they allow us to more effectively evaluate our
operating performance and compare the results of our operations
from period to period without regard to our financing methods,
capital structure or income taxes and construction services (when
applicable).
Net debt is calculated by deducting “Cash and cash
equivalents” from total financial debt.
Figures ex-IAS 29 result from dividing nominal Argentine
pesos for the Argentine Segment, by the average foreign exchange
rate of the Argentine Peso against the US Dollar in the period.
Percentage variations ex-IAS 29 figures compare results as
presented in the prior year quarter before IAS 29 came into effect,
against ex-IAS 29 results for this quarter as described above. For
comparison purposes the impact of adopting IAS 29 in Aeropuertos
Argentina 2000, the Company’s largest subsidiary in Argentina, is
presented separately in each of the applicable sections of this
earnings release, in a column denominated “IAS 29”. The impact from
“Hyperinflation Accounting in Argentina” is described in more
detail page 18 of this report.
Definitions and Concepts
Commercial Revenues: CAAP derives commercial revenue
principally from fees resulting from warehouse usage (which
includes cargo storage, stowage and warehouse services and related
international cargo services), services and retail stores, duty
free shops, car parking facilities, catering, hangar services, food
and beverage services, retail stores, including royalties collected
from retailers’ revenue, and rent of space, advertising, fuel,
airport counters, VIP lounges and fees collected from other
miscellaneous sources, such as telecommunications, car rentals and
passenger services.
Construction Service revenue and cost: Investments
related to improvements and upgrades to be performed in connection
with concession agreements are treated under the intangible asset
model established by IFRIC 12. As a result, all expenditures
associated with investments required by the concession agreements
are treated as revenue generating activities given that they
ultimately provide future benefits, and subsequent improvements and
upgrades made to the concession are recognized as intangible assets
based on the principles of IFRIC 12. The revenue and expense are
recognized as profit or loss when the expenditures are performed.
The cost for such additions and improvements to concession assets
is based on actual costs incurred by CAAP in the execution of the
additions or improvements, considering the investment requirements
in the concession agreements. Through bidding processes, the
Company contracts third parties to carry out such construction or
improvement services. The amount of revenues for these services is
equal to the amount of costs incurred plus a reasonable margin,
which is estimated at an average of 3.0% to 5.0%.
About Corporación América Airports
Corporación América Airports acquires, develops and operates
airport concessions. The Company is the largest private airport
operator in the world based on the number of airports and the tenth
largest based on passenger traffic. Currently, the Company operates
52 airports in 7 countries across Latin America and Europe
(Argentina, Brazil, Uruguay, Peru, Ecuador, Armenia and Italy). In
2018, Corporación América Airports served 81.3 million
passengers. The Company is listed on the New York Stock Exchange
where it trades under the ticker “CAAP”. For more information,
visit http://investors.corporacionamericaairports.com
Forward Looking Statements
Statements relating to our future plans, projections, events or
prospects are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements include all statements that are not historical facts and
can be identified by terms such as “believes,” “continue,” “could,”
“potential,” “remain,” “will,” “would” or similar expressions and
the negatives of those terms. Forward-looking statements involve
known and unknown risks, uncertainties and other factors that may
cause our actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Many factors could cause our actual activities or
results to differ materially from the activities and results
anticipated in forward-looking statements, including, but not
limited to: delays or unexpected casualties related to construction
under our investment plan and master plans, our ability to generate
or obtain the requisite capital to fully develop and operate our
airports, general economic, political, demographic and business
conditions in the geographic markets we serve, decreases in
passenger traffic, changes in the fees we may charge under our
concession agreements, inflation, depreciation and devaluation of
the AR$, EUR, BRL, UYU, AMD or the PEN against the U.S. dollar, the
early termination, revocation or failure to renew or extend any of
our concession agreements, the right of the Argentine Government to
buy out the AA2000 Concession Agreement, changes in our investment
commitments or our ability to meet our obligations thereunder,
existing and future governmental regulations, natural
disaster-related losses which may not be fully insurable, terrorism
in the international markets we serve, epidemics, pandemics and
other public health crises and changes in interest rates or foreign
exchange rates. The Company encourages you to review the
‘Cautionary Statement’ and the ‘Risk Factor’ sections of our annual
report on Form 20-F for the year ended December 31, 2018 and any of
CAAP’s other applicable filings with the Securities and Exchange
Commission for additional information concerning factors that could
cause those differences.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190521005287/en/
Investor Relations ContactGimena AlbanesiHead of Investor
RelationsEmail: gimena.albanesi@caairports.comPhone: +5411
4852-6411
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