Central North Airport Group 6-K, filed Oct 31, 2022
Central North Airport Group (OMAB)
About this 6-K
Central North Airport Group filed this 6-K on October 31, 2022.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of October
GRUPO AEROPORTUARIO DEL CENTRO NORTE, S.A.B. DE C.V.
(CENTRAL NORTH AIRPORT GROUP)
_________________________________________________________________
(Translation of Registrant’s Name Into English)
México
_________________________________________________________________
(Jurisdiction of incorporation or organization)
Torre Latitud, L501, Piso 5
Av. Lázaro Cárdenas 2225
Col. Valle Oriente, San Pedro Garza García
Nuevo León, México
_________________________________________________________________
(Address of principal executive offices)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
| Form 20-F X Form 40-F |
(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
| Yes No X |
(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- .)
OMA Announces Third Quarter 2022
Operating and Financial Results
Mexico City, Mexico, October 28, 2022— Mexican airport operator Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., known as OMA (NASDAQ: OMAB; BMV: OMA), today reported its unaudited, consolidated financial and operating results for the third quarter 2022 (3Q22).
3Q22 Summary
| ■ | Passenger traffic increased 22.8% during 3Q22, as compared to 3Q21, reaching 6.3 million passengers, and increased 2.0% as compared to 3Q19. The airports with the highest traffic growth compared to 3Q21 were Monterrey, Culiacán, Chihuahua, Mazatlán and Ciudad Juárez. |
| ■ | Adjusted EBITDA was Ps.1,907 million, which compares to Ps.1,473 million in 3Q21, and was 31.6% higher than 3Q19. |
| ■ | Adjusted EBITDA margin reached 76.5%, compared to 75.2% in 3Q21 and 74.1% in 3Q19. |
| ■ | Capital investments and major maintenance works included in the Master Development Plans (MDPs) plus strategic investments were Ps.839 million in the quarter. |
OMA will hold its 3Q22 earnings conference call on October 31, 2022 at 12:00 p.m. Eastern time, 10:00 a.m. Mexico City time.
Call +1-877-407-9208 toll-free from the U.S. or +1-201-493-6784 from outside the U.S. The conference ID is 13733556. The conference call will also be available by webcast at http://ir.oma.aero/en/calendario-de-eventos.
3Q22 Operating Results
Operations, Passengers, and Cargo
The number of seats offered increased 16.9% compared to 3Q21 and decreased 0.4%, compared to 3Q19.
During the quarter, 8 new routes, started operations.
Total passenger traffic reached 6.3 million passengers, an increase of 22.8% as compared to 3Q21 and an increase of 2.0% versus 3Q19. During the quarter, of total traffic, 89.1% was domestic and 10.9% was international.
Domestic passenger traffic increased 25.6%, compared to 3Q21, while international traffic increased 4.1%. Compared to 3Q19, domestic passenger traffic and international passenger traffic increased 1.8% and 3.7%, respectively.
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The airports with the largest passenger traffic growth in volume terms as compared to 3Q21, were:
| ■ | Monterrey (+25.6%), on its Mexico City, Guadalajara and Cancún routes. |
| ■ | Culiacán (+31.1%), on its Tijuana, Mexicali, San José del Cabo, Guadalajara and Mexico City routes. |
| ■ | Chihuahua (+21.4%), on its Cancún, Mexico City, Dallas and Monterrey routes. |
| ■ | Mazatlán (+31.2%), on its Mexico City, Tijuana and Monterrey routes. |
| ■ | Ciudad Juárez (+17.4%), on its Mexico City and Cancún routes. |
The airports with the largest passenger traffic recovery in volume terms as compared to 3Q19, were:
| ■ | Ciudad Juárez (+26.5%), on its Mexico City, Cancún, Guadalajara and Puerto Vallarta routes. |
| ■ | Mazatlán (+35.4%), on its Tijuana, Mexico City, Chihuahua and Phoenix routes. |
| ■ | Culiacán (+2.5%), on its Tijuana, Mexicali, San José del Cabo and Cancún routes. |
| ■ | Reynosa (+7.2%), on its Mexico City route. |
| ■ | San Luis Potosí (+5.4%), on its Cancún, Dallas and Tijuana routes. |
Commercial Operations
The commercial space occupancy rate in the passenger terminals was 93.0% as of September 30, 2022. During the quarter, a total of 1,002 m2 in commercial spaces were occupied, mainly in the Monterrey and Tampico airports.
Freight Logistics Services
| ■ | OMA Carga’s revenues increased by 34.7%, compared to 3Q21 due to higher handling, storage and custody activity related to ground and air import cargo. Total tonnage handled was 9,851 metric tons, 9.5% lower than 3Q21. |
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Hotel Services
| ■ | The NH Collection Terminal 2 Hotel had a 78.5% occupancy rate, compared to 69.5% in 3Q21, with an 11.3% increase in the average room rate to Ps.2,448 per night. |
| ■ | Hilton Garden Inn had a 76.6% occupancy rate, compared to 51.0% in 3Q21, with a 13.1% increase in the average room rate to Ps.2,155 per night. |
Industrial Services
| ■ | OMA VYNMSA Aero Industrial Park: Revenues reached Ps.18.2 million, an increase of 17.3% versus 3Q21. The increase is explained by a higher number of leased m2 as compared to 3Q21. |
Consolidated Financial Results
Revenues
Aeronautical revenues increased 27.0% mainly due to an increase in passenger traffic, compared to 3Q21, as well as the increase in aeronautical tariffs during 1Q22.
Non-aeronautical revenues increased 27.8%.
Commercial revenues increased 33.8%. The line items with the largest increases were:
| ■ | Parking, +58.1%, as a result of an increase in passenger traffic, as well as higher penetration in the Chihuahua, Monterrey and Culiacán airports. |
| ■ | Car Rentals, Restaurants and Retail, +33.9%, +22.9% and +34.3%, respectively, as a result of an increase in revenue share and the start of operations of new initiatives implemented. |
| ■ | VIP Lounges, +57.4%, as a result of the transition to a direct operation of the OMA Premium Lounges and an increase in number of users of these lounges. |
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Diversification revenues increased 34.6%, mainly due to higher revenues from Hotel Services and OMA Carga.
Construction revenues represent the value of improvements to concessioned assets. They are equal to construction costs and generate neither a gain nor a loss. Construction revenues and costs are determined based on the advance in the execution of projects in accordance with the airports’ Master Development Programs (MDP), and variations depend on the rate of project execution.
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Costs and Operating Expenses
The sum of cost of airport services and general and administrative expenses (G&A) increased 15.5%, mainly due to higher payroll costs; contracted services; and materials and supplies.
The major maintenance provision was Ps.51 million. The outstanding balance of the maintenance provision as of September 30, 2022 was Ps.1,966 million.
The airport concession tax was Ps.115 million and the technical assistance fee was Ps.50 million.
Total operating costs and expenses increased 20.0%.
Operating Income and Adjusted EBITDA
Operating Income was Ps.1,717 million, with an operating margin of 54.6%.
Adjusted EBITDA was Ps.1,907 million, with a margin of 76.5%.
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Financing Income and Net Income
Financing Expense was Ps.219 million, compared to Ps.42 million during 3Q21. The increase was mainly due to a higher interest expense as a result of the level of indebtedness and an increase in financing costs, as well as the variation to the present value of the major maintenance provision; and an exchange loss compared to an exchange gain in 3Q21.
Consolidated net income in the quarter was Ps.1,101 million, an increase of 35.7%.
Earnings per share, based on net income of the controlling interest was Ps.2.84, and earnings per ADS was US$1.13. Each ADS represents eight Series B shares.
MDP and Strategic Investments
In 3Q22, capital investments and major maintenance works in the MDPs and strategic investments totaled Ps.839 million, comprised of Ps.653 million in improvements to concessioned assets, Ps.103 million in major maintenance and Ps.83 million in strategic investments.
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The most important investment expenditures included:
Indebtedness
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Derivatives
As of the date of this report, OMA has no financial derivatives exposure.
Cash Flow Statement
During 3Q22, cash flows from operating activities generated cash of Ps.1,628 million.
Investing activities used cash for Ps.613 million in the third quarter. Financing activities reflect mainly the payment of the second dividend installment of Ps.495 million, resulting in a net cash outflow of Ps.698 million.
The net increase in cash resulting from operating, investing and financing activities in 3Q22 was Ps.316 million. This, combined with the negative effect of changes in the value of cash of Ps.0.3 million, resulted in a Cash and Cash Equivalents balance as of September 30, 2022 of Ps.2,073 million.
Subsequent Events
Agreement between Fintech Advisory and Vinci Airports. On July 31, 2022, OMA was informed by Fintech Advisory Inc. (“Fintech”) that certain affiliates of Fintech had entered into a share purchase agreement with a subsidiary of VINCI Airports SAS (“VINCI”) to indirectly sell 29.9% of the capital stock of OMA. The consummation of the transaction is subject to certain customary closing conditions, including applicable regulatory approvals.
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Notes to the Financial Information
Financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”), and presented in accordance with IAS 34 “Interim Financial Reporting.” For more information, please refer to our Quarterly Financial Information submitted to the Mexican Stock Exchange (www.bmv.com.mx)
Unless stated otherwise, all comparisons of operating or financial results are made with respect to the comparable prior of 2021. The exchange rates used to convert foreign currency amounts were Ps.20.4977 as of September 30, 2021, Ps.20.4672 as of December 31, 2021 and Ps.20.1927 as of September 30, 2022.
Construction revenue, construction cost: IFRIC 12 “Service Concession Arrangements” addresses how service concession operators should account for the obligations they undertake and rights they receive in service concession arrangements. The concession contracts for each of OMA’s airport subsidiaries establishes that the concessionaire is obligated to carry out improvements to the infrastructure transferred in exchange for the rights over the concession granted by the Federal Government. The latter will receive all the assets at the end of the concession period. As a result, the concessionaire should recognize, using the percentage of completion method, the revenues and costs associated with the improvements to the concessioned assets. The amount of the revenues and costs so recognized should be the price that the concessionaire pays or would pay in an arm’s length transaction for the execution of the works or the purchase of machinery and equipment, with no profit recognized for the construction or improvement. The application of IFRIC 12 does not affect operating income, net income, or EBITDA, but does affect calculations of margins based on total revenues.
Capital investments: includes investments in fixed assets (including investments in land, machinery, and equipment) and improvements to concessioned properties under the Master Development Plan (MDP) plus strategic investments.
Strategic Investments: Refers only to those capital investments additional to the Master Development Program.
Passengers and Terminal passengers: All references to passenger traffic volumes are to Terminal passengers, which includes passengers on the three types of aviation (commercial, charter, and general aviation), and excludes passengers in transit.
Adjusted EBITDA and Adjusted EBITDA margin: OMA defines Adjusted EBITDA as EBITDA less construction revenue plus construction expense and maintenance provision. We calculate the Adjusted EBITDA margin as Adjusted EBITDA divided by the sum of aeronautical revenue and non-aeronautical revenue. Construction revenue and construction cost do not affect cash flow generation and the maintenance provision corresponds to capital investments. OMA defines EBITDA as net income minus net comprehensive financing income, taxes, and depreciation and amortization. Neither Adjusted EBITDA nor EBITDA should be considered as an alternative to net income as an indicator of our operating performance, or as an alternative to cash flow as an indicator of liquidity. It should be noted that neither Adjusted EBITDA nor EBITDA is defined under IFRS, and may be calculated differently by different companies.
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Analyst Coverage
In accordance with the requirements of the Mexican Stock Exchange, the analysts covering OMA are:
This report may contain forward-looking information and statements. Forward-looking statements are statements that are not historical facts. These statements are only predictions based on our current information and expectations and projections about future events. Forward-looking statements may be identified by the words “believe,” “expect,” “anticipate,” “target,” “estimate,” or similar expressions. While OMA’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and are generally beyond the control of OMA, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include, but are not limited to, those discussed in our most recent annual report filed on Form 20-F under the caption “Risk Factors.” OMA undertakes no obligation to update publicly its forward-looking statements, whether as a result of new information, future events, or otherwise.
About OMA
Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., known as OMA, operates 13 international airports in nine states of central and northern Mexico. OMA’s airports serve Monterrey, Mexico’s third largest metropolitan area, the tourist destinations of Acapulco, Mazatlán, and Zihuatanejo, and nine other regional centers and border cities. OMA also operates the NH Collection Hotel inside Terminal 2 of the Mexico City airport and the Hilton Garden Inn at the Monterrey airport. OMA employs over 1,100 persons in order to offer passengers and clients airport and commercial services in facilities that comply with all applicable international safety and security measures. OMA is listed on the Mexican Stock Exchange (OMA) and on the NASDAQ Global Select Market (OMAB). For more information, visit:
| ● | Webpage http://ir.oma.aero |
| ● | Twitter http://twitter.com/OMAeropuertos |
| ● | Facebook https://www.facebook.com/OMAeropuertos |
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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. |
| By: | /s/ Ruffo Pérez Pliego | |
| Ruffo Pérez Pliego | ||
| Chief Financial Officer | ||
Dated October 28, 2022