Equity Analysis /

AIRPORTS: Passenger growth accelerates

  • Passenger traffic in Asur rose 28.4%, in Gap 24.9% and in Oma 27.4% given a strong demand and an easy comparative base

  • Asur achieved the greatest annual advances mostly in the international segment, followed by Oma’s boost in domestic

  • We reaffirm the positive sector outlook, given the perspectives for the rest of the year and attractive valuations

Jose Itzamna Espitia Hernandez
Jose Itzamna Espitia Hernandez

Senior Equity Research Analyst, Infrastructure, Materials and Transportation

9 September 2022
Published byBanorte

Passenger growth accelerates

  • Passengers at the airports operated in Mexico by Asur, Gap, and Oma, recorded a solid performance, once again surprising with a higher annual growth rate vs. previous month

  • Regarding total operations (including those outside of Mexico), Asur registered a 28.4% hike in passenger growth, Gap a 24.9% rise, and Oma a 27.4% advance

  • The greater dynamism in demand reaffirms our continued traffic growth expectations, so we continue to have a positive sector outlook, although focusing our attention to economic challenges

In August, the total number of passengers at the 3 airport groups recorded an annual advance of 26.8% (airports operated in Mexico). Demand continued to reflect strength, which alongside an easy comparative base given the COVID-19 infections surge in August of last year, resulted in a higher annual growth rate compared to the previous month. Thus, total passengers at the airports operated in Mexico increased by 26.8% y/y (vs. 20.0% advance in July), exceeding our 23.0% estimate. Domestic passengers (representing 65.9% of the total) increased 28.6% y/y, while the international passengers grew 23.3% y/y.

Individually, Asur recorded a 28.4% y/y growth, including a solid 32.7% y/y advance in Mexico’s passengers. In San Juan, Puerto Rico, traffic remains weak by dropping 3.0% annually, while Colombia continued its strong performance by climbing 46.0% y/y. In turn, Gap recorded a total passenger advance during August of 24.9% y/y. Passenger traffic from airports it operates in Mexico, excluding Montego Bay Airport in Jamaica (+38.0% y/y), and Kingston Airport (+4.7% m/m), had an annual increase of 22.0%. Finally, Oma presented a growth of 27.4% y/y in passengers.

Total passenger variations of Asur, Gap, and Oma of the LTM were placed at 57.4%, 43.4%, and 41.4% (September 2021 – August 2022), compared to the LTM of July of 67.8%, 48.8%, and 46.6% (August 2021 – July 2022), respectively.

Corporate News

·      Gap mentioned that during the month two new routes were opened and the volume of seats offered increased 22.7% y/y, while the load factor was placed at 80.2% vs. 77.5% in August 2021.

·      Oma noted that during the month two new routes began operating: Monterrey—Santa Lucía (AIFA), and Acapulco—Santa Lucía (AIFA)

Conclusion... Passengers at the airports operated by private groups in Mexico, recorded a performance that once again surprised positive, reaffirming our expectation that solid demand dynamism will continue in following months. Considering all operations, including those outside Mexico, Asur was positioned this month with the highest annual increase where international segment continues to stand out, followed by Oma with a good boost in domestic, and finally, Gap. We reiterate our favorable sector opinion given the interesting growth outlook for the rest of the year and attractive valuations, although we are closely tracking economic challenges. In our institutional portfolio, we have exposure to Asur with a PT of MXN 483.50 per share and Oma with a PT of MXN 158.00 per share, both with a Buy recommendation. However, for Gap our PT is MXN 300.00 per share, with a Hold recommendation.

August passenger traffic

The following graphs show the evolution of the airport groups' total passengers over the last 12 months (percentage variation y/y) and the performance shares vs. S&P/BMV IPC.

Sector comparison – Figures at August 2022