Equity Analysis /

Grupo Aeroportuario del Pacifico: Flash GAP: Domestic passenger growth returns in March

  • Gap posted a 4.6% y/y fall in March’s passengers, sequential improvement of 45.6% stemmed from better demand performance

  • For the 12 airports operated in Mexico it advanced 1.2% y/y, due to a more natural basis and a favorable Easter effect

  • With the above, positive growth rates in passengers (including operations in Jamaica) would be confirmed as of April

Jose Itzamna Espitia Hernandez
Jose Itzamna Espitia Hernandez

Senior Equity Research Analyst, Infrastructure, Materials and Transportation

Marissa Garza Ostos
Marissa Garza Ostos

Head of Equity Research

8 April 2021
Published byBanorte

Gap recorded a 4.6% y/y decline in March passenger traffic, considering the 14 airports it operates. The noteworthy sequential improvement of 45.6% m/m, stemmed from improved demand performance, which was further supported by a more natural comparative base due to the pandemic onset in March 2020, as well as a favorable effect from the start of Easter vs. April of the previous year. Thus, and surprisingly, domestic passengers increased 10.6% annually, while international passengers contracted 24.3% y/y, still showing weakness due to restrictions on travelers from the US and Canada.

Total passengers at the 12 airports it operates in Mexico advanced 1.2% y/y in the month, which was well above expectations, as we anticipated a ~26.0% reduction.  Montego Bay Airport in Jamaica (MBJ) showed a 50.5% y/y drop, similar to Kingston Airport's 49.6% decline in passengers. Finally, the company mentioned that the volume of seats offered in March decreased 22.7% y/y and that the load factor during the month rose 13.1pp from 57.1% in March 2020 to 70.2%.

Positive implication: Gap's traffic performance exceeded our expectations, and we highlight the fact that in Mexico there has already been a slight annual increase. Considering the above, positive growth rates in the group's total passengers (including operations in Jamaica) would be confirmed as of April. Thus, it will be important to know any outlook update that the issuer may communicate when it releases its 4Q20 results in the coming weeks.