Good morning and welcome to Corporación América Airports Third Quarter 2020 Earnings Conference Call. A slide presentation accompanies today's webcast and is available in the investors section of Corporación América Airports’ investor relations website at http://investors.corporacionamericaairports.com. As a reminder, all participants will be in listen-only mode. As a reminder, this call is being recorded. At this time, I would like to turn the call over to Gimena Albanesi of investor relations. Go ahead.

Thank you. Good morning everyone, and thank you for joining us today. Speaking during today's call will be Martín Eurnekian, our Chief Executive Officer. Also with us today are Raúl Francos, our Chief Financial Officer; and Jorge Arruda, Head of Finance and M&A.

Thank you, Gimena. Hello everyone, and welcome to today's call. Results this quarter remain impacted by the ongoing effects of the global COVID-19 pandemic, which resulted in travel restrictions and lower passenger demand. However, we experienced a sequential improvement in our performance mainly driven by improved traffic trends in our key markets Italy and Brazil. By contrast, in Argentina, travel bans to foreigners and lower local demand in international traffic, along with strict restrictions to domestic travel throughout the quarter resulted in limited traffic. More recently, the government relaxed some restrictions as the summer season approached. I will expand on these trends in more detail shortly. Over the past six months, we have made significant strides working simultaneously on several fronts to mitigate the severe impact of this health crisis. To begin with, I am very proud of how our teams have reacted rapidly to these unprecedented challenges to ensure the health and safety of employees and passengers across our operations. Upholding high safety standards is of paramount importance for us, with several of our main airports already receiving independent health certifications. We succeeded because we have some goals that we established for the second and third quarter of this year. This allowed us to lower our cash operating costs, excluding concession fees, by 48% compared to the same period last year. Importantly, our operations in Argentina, Uruguay, Ecuador, and Armenia achieved operating cash breakeven levels in the quarter. On the debt front, we refinanced an important portion of our principal and interest payment and remain focused on strengthening our financial position. We have also been working with regulatory bodies and governments across our concessions to obtain compensation for the impact of this crisis, and then we will discuss updates for the quarter shortly.

We will now begin the question-and-answer session. Our first question is from Roberta Versiani from Citibank. Go ahead.

Hi, good morning. I'm sorry, if I already talked about that, I had some connectivity issues here. But I'd like to know what are your expectations for the Argentina airport extension, and how is the timeframe of discussions in concessions such as Brazil? And also, if I may ask another one, I'd like to know if you understate further cost reductions such as maybe adjustments in your workforce, and etc.? Thank you.

Hello, Roberta. This is Martín. Thank you for your question and your interest. Regarding the discussions with the different governments and the Argentina one, as we said earlier, we continue engaging the regulator regarding the pandemic and on the concession to find ideas to compensate for this crisis. Once we have clear information or an event, we will keep the market informed as soon as that happens, but so far, we are continuing with the discussion. The same thing happens in the rest of the countries where we're having very similar discussions regarding each of the concession frameworks that we have. And regarding your second question on cost reductions, they were basically all over our cost structure. We have some restrictions in different countries regarding how we can handle employees. But in places where there are no such restrictions, we have made adjustments to our payroll size and headcount. And in others, we have taken different measures across our cost structure in terms of OpEx contracts and everything you can think of. We are using different methodologies in different countries to come up with the most aggressive cost reductions possible. Thank you very much.

Okay, thank you.

Our next question is from Goldman Sachs. Go ahead.

Hi, good morning. Thank you for taking my question. Very quickly, on your negotiations with regulators across the board, what are your expectations regarding CapEx and tariffs, especially in Argentina? And my second question would be how are you seeing local capital markets liquidity now in Argentina? If you need to access local markets, how do you think you could raise cash there? Thank you.

Thank you for your questions. First of all, the discussions with the regulators, most of our concessions have the usual parameters we can use to compensate or create or recover economic equilibrium, whether they be capital adjustments, tariffs, length of the concession, and concession fees; those are the main levers we can pull to create or regain economic equilibrium. And at this time, I think depending on the different structures and frameworks of the concession we own, all of them are in discussions. But as I said before, there are still discussions. Once we have a concrete agreement, we will go back and inform the market and investors as soon as we can. In terms of local market liquidity in Argentina, as you can imagine, it’s fairly volatile given the macro conditions and the pandemic situation in Argentina. But as you saw in August, we were able to access the market with a $40 million note that was for zero percent interest. So again, the conditions of the market are fairly volatile. But so far, we've been able to access it, and we keep monitoring it very closely to understand what we have in terms of access to liquidity there. Thank you very much.

Thank you.

Our next question is from Peter Bowley from Bank of America. Go ahead.

Good morning, Martín and Raúl. Hey, thank you for your time and taking my questions. I have two focused on Argentina. Given the significant progress on cost rationalization, can you share any color on how much you expect these costs to persist? Are these cost cuts going to persist as volume ramps up in 2021? And my second question is if you could share any update on the negotiation of the syndicated bank loans, given the Central Bank’s new foreign exchange restrictions? Thank you.

Hello Peter, thank you for your question again. As I mentioned before, the opportunity brought by the pandemic to go very, very deep into our cost structure to gain efficiencies and reduce costs, we think that it's going to last going out of the pandemic. In what size or how much of it will last is difficult to say now, as we are adjusting very fast to the reopening of the new traffic, and we understand what is required operationally in terms of the new health measures and so on. But personally, I can tell you that the way that this pandemic hit us and the fact that we had to stop operations gave us the time that we usually did not have to go very, very deep into the analysis of our costs and the renegotiation with many suppliers. Also, we were able to adapt very interesting methodologies to enhance this analysis and achieve cost cuts. So, I personally expect a leaner company going out of the pandemic. How much compared to pre-pandemic levels? It's very difficult to say right now. But I'm sure that the teams have used this time as effectively as they could and that we will see the benefits from that in the future, very surely. But it's very difficult to assign a number to it as of today with the amount of uncertainty that we have going into the future. I will pass it on to Jorge Arruda to answer your second question regarding the syndicated loans in Argentina.

Thank you, Martín. Hi, this is Jorge. In connection with your second question regarding the new rule issued by the Central Bank of Argentina last September, in connection with the syndicated loan, let me start with the bond. On November 1, we were able to pay the interest due and payable or the debt service due and payable under the portion of the bonds that have not participated in the exchange. We were not – the way our debt service works and the bond didn't fit exactly the new rules; however, we obtained an authorization from the Central Bank to make that payment and we are working with the Central Bank in connection with the February payment for the syndicated loan, so we do not see an issue. There is only one portion of the syndicated loan that would have to be paid outside Argentina, because part of it is payable locally, although denominated in U.S. dollars. Currently, we expect that these restrictions would not be extended beyond the period that they have determined in the rule that was issued in September. So, in summary, it's under control for us.

Thank you very much.

At this time we have no questions. So, we’ll conclude our question-and-answer session. I would like to turn the conference back over to Martín Eurnekian for closing remarks. Go ahead.

I'd like to thank everybody for joining us today. We really appreciate your interest in our company, and we look forward to providing updates on our business initiatives as they become available. In the meantime, the team remains available to answer any questions that you may have. Thanks everybody. Bye, bye.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.