Earnings Report /

Promotora y Operadora de Infraestructura: PINFRA, Quarterly Report 1Q21: Growth returns at the start of the year

  • Pinfra's results showed advances, supported by growth in Construction and better performance in Concessions

  • Financial strength (ND/EBITDA -1.9x) stands out, which gives it the possibility of incorporating new projects

  • Improved performance will reflect a higher cash flow generation, boosted by a long-term highway concession portfolio

Jose Itzamna Espitia Hernandez
Jose Itzamna Espitia Hernandez

Senior Equity Research Analyst, Infrastructure, Materials and Transportation

3 May 2021
Published byBanorte
  • Pinfra's results showed advances, in line with expectations, supported by growth in Construction and a better performance in Concessions due to activities reopening

  • Financial strength (ND/EBITDA -1.9x) stands out in the company, which gives it the possibility of incorporating new projects. In the meantime, we anticipate solid increases in 2021 figures

EBITDA grew in all three segments and profitability exceeded expectations. Pinfra registered a 5.9% y/y jump in revenues in 1Q21 to $2.7 billion, in line, despite a difficult start to the year due to the pandemic. While traffic on concessioned highways declined 7% y/y, partially offset by the start of operations of the Monterrey-Nuevo Laredo highway in 3Q20, as the reopening of activities progresses, the figures show smaller declines. Concessions posted a 1.3% y/y climb, which coupled with a 63.3% y/y increase in Construction (due to a higher work volume in the Aguascalientes Beltway), more than offset the 13.8% decline in Plants. Meanwhile, EBITDA increased 3.8% y/y to $1.8 billion. By segment, year-over-year growth was 2.6% in Concessions, 78.0% in Construction, and 1.0% in Plants. Although this resulted in a lower profitability of 1.3pp y/y to 64.8%, it was better than anticipated. Finally, net income rose 2.9% y/y, favored by a positive FX effect.

Resuming growth and in search of new opportunities. Given the expected recovery and an easy comparative base, the improved operating performance will reflect a higher cash flow generation, supported by the long-term highway concession portfolio. The above, hand in hand with a solid financial position, favorably places the company to continue growing through potential investment opportunities, such as the recent acquisition of a highway concession in Hidalgo.