Grupo Aeroportuario del Sureste Q2 2025 Earnings Call Transcript

Key Takeaways

  • Negative Sentiment: Passenger traffic was flat at 17.7 million year-on-year, with Mexico down 2% due to the Tulum ramp-up and weak international demand offset by 3% growth in Puerto Rico and 1% in Colombia.
  • Positive Sentiment: Total revenues rose 5% to 7.4 billion pesos, driven by high-teens growth in Puerto Rico, 15.4% growth in Colombia and modest 0.7% growth in Mexico, while commercial revenue per passenger grew mid-single digits.
  • Negative Sentiment: Expenses jumped nearly 10% year-on-year—driven by a 12% minimum wage hike and higher operating costs—causing Mexico EBITDA to fall 1.6% and overall adjusted EBITDA margin to slip to 68% from 69%.
  • Negative Sentiment: The bottom line was hit by a 1.2 billion-peso foreign exchange loss due to peso strength, compared with a 942 million-peso FX gain in the year-ago quarter.
  • Positive Sentiment: With 20 billion pesos in cash, net debt/EBITDA of 0.1x, and 1.4 billion in capex underway, the company paid a 50-peso dividend in May and two 15-peso extraordinary dividends, underscoring a strong balance sheet.
AI Generated. May Contain Errors.
Earnings Conference Call
Grupo Aeroportuario del Sureste Q2 2025
00:00 / 00:00

There are 3 speakers on the call.

Speaker 1

Ladies and gentlemen, welcome to ASUR's second quarter 2025 results conference call. My name is Christine and I'll be your operator at this time. All participants are in listen-only mode. We will conduct a question and answer session toward the end of today's conference. If you would like to ask a question, please press star 1. If you want to withdraw your question at any time, please press star 2. If you are using a speakerphone, please lift the handset before making the selection. As a reminder, today's call is being recorded. Now, I'd like to turn this call over to Mr. Adolfo Castro Rivas, Chief Executive Officer. Please go ahead, sir.

Speaker 2

Thank you, Christine, and good morning, everyone. Before I begin discussing our results, let me remind you that certain statements in English on the call today may constitute forward-looking statements, which are based on current management expectations and beliefs and are subject to several risks and uncertainties that could cause actual results to differ materially, including factors that may be beyond our company's control. Additional details about our second quarter 2025 results can be found in our press release, which was issued yesterday after market close and is available on our website in the Investor Relations section. Following my presentation, I will be available for Q&A as usual. All comparisons discussed on this call will be year-on-year figures and are expressed in Mexican pesos unless specified otherwise. During the second quarter, we served 17.7 million passengers across all airports we operate, with traffic remaining largely flat year-on-year.

Speaker 2

Once again, bad performance in Colombia and Puerto Rico offset softness in Mexico. Puerto Rico was the best performing market this quarter, posting 3% growth in passenger traffic, supported by domestic traffic and a sustained trend in international traffic. In Colombia, traffic was up 1%, with international travel up 12% and domestic contracting in low single digits. Lastly, Mexico reported a decline of nearly 2% in total traffic, with an increase of 1.2% in domestic offset by a decrease of 4.5% in international traffic. International travel in Mexico continued to experience year-on-year declines from all regions during the quarter. Passenger volumes from Europe were down 4.7%, from the U.S. 5.3%, South America 2.7%, and Canada 1.6%. A meaningful portion of this decline, approximately 38%, is attributable to the ramp-up of the new airport in Tulum, which continues to draw some passenger flow previously concentrated in Cancún.

Speaker 2

Beyond this shift, we believe the broader softness in international traffic reflects broader market dynamics, including a more cautious demand environment across several source markets. While the underlying drivers vary, some of these pressures are also evident in other international markets as well. Looking ahead, we expect traffic in Mexico to gradually stabilize over the course of next year as the effect of the engine-related aircraft groundings appear to have bottomed out and Tulum airport reaches a more normalized level of operations. With respect to the potential U.S. U.S. Department of Transportation restrictions on Mexican carriers, ASUR does not expect a material impact on our operations from these measures as our exposure to unaffected airlines is minimized. To put this in context, Aeromexico accounted for just 0.3% of total passengers traveling between our airports and the U.S. while Viva Aerobus and Volaris together represented approximately 1.3%.

Speaker 2

As I noted in prior calls, we see long term growth potential for both Cancún and Tulum, each driven by the specific demand dynamics of their respective catchment area. While the broader macro environment remains uncertain, history has shown that travel related disruptions, particularly those tied to U.S. and Mexico demand, tend to be temporary in nature. Now turning to a review of our financial performance, recall that all references to revenue and cost figures are peso-denominated. ASUR's total revenues increased 5% year on year to $7.4 billion pesos, reflecting top line growth across operations, particularly in Puerto Rico and Colombia. Mexico, which accounted for 72% of total revenues, posted a low single digit increase of 0.7% with relatively flat growth in aeronautical and non-aeronautical revenues. Puerto Rico contributed 17.7% of the total revenues with top line growth in the high teens.

Speaker 2

This compared to growth in the high 20s in the prior quarter that was supported by the foreign exchange rate benefit resulting from a weaker peso. Colombia, which accounted for 12% of total revenues, posted a 15.4% top line growth. This accelerated from growth in the 13% achieved in prior quarters. This was driven by both aeronautical and non-aeronautical revenues, which benefited from the continued recovery in domestic traffic and international traffic and the opening of 35 new commercial spaces over the past 12 months, partially offset by a strong Mexican peso. As part of our ongoing strategy to increase our commercial offerings, we opened 47 new commercial spaces over the last 12 months. As I said, 35 in Colombia, 7 in Mexico, 5 in Puerto Rico.

Speaker 2

This expansion supported high single digit growth in total commercial revenues, driven by strong performance in Colombia and Puerto Rico and a modest improvement on a per passenger basis. Commercial revenue reached nearly $140 pesos in the quarter, representing mid single digit year on year growth with contributions from all three regions. Colombia led with a 22% increase, followed by a 30% gain in Puerto Rico, those achieved by less favorable exchange rates. In Mexico, commercial revenue per passenger rose nearly 3% to 259 pesos even as passenger traffic fluctuated. Moving on to costs, total expenses increased nearly 10% year on year, this accelerating from the 18% growth we saw in the prior quarter. In Mexico, costs rose 10%, primarily reflecting the 12% increase in minimum wage effective at the start of the year.

Speaker 2

In both Puerto Rico and Colombia, costs increased in low teens, benefiting from the appreciation of the Mexican peso against the U.S. dollar and the Colombian peso. As a result, consolidated EBITDA rose slightly 2% year over year, reaching 5 billion pesos in the quarter. Notably, Puerto Rico and Colombia posted double-digit growth of 20% and 15% respectively, while Mexico saw a 1.6% decrease in EBITDA in line with the passenger traffic. The negative impact of the strong peso and the higher costs I just explained adjusted the EBITDA margin, which excludes construction revenue, stood at nearly 68% compared with 69% in the same quarter last year. The slight margin contraction was mainly attributable to a 170 basis points decline in Mexico, while Colombia posted a more modest 20 basis points decrease. Puerto Rico, on the other hand, delivered a 120 basis points margin improvement in a transpilva margin.

Speaker 2

Our bottom line this quarter was negatively impacted by a foreign exchange loss of 1.2 billion pesos driven by the appreciation of the Mexican peso against the U.S. dollar. This compares to a foreign exchange gain of 972 million in the same quarter last year, which reflected the opposite effect driven by the depreciation of the peso during that period. Moving on to our balance sheet, we maintained a strong cash position, closing the quarter with nearly 20 billion pesos in cash and cash equivalents, up 30% year on year. Net debt to EBITDA ratio increased slightly to 0.1 times, reflecting the drawdown of a loan facility in Mexico for 9.5 billion pesos in the quarter. Turning to capital allocation, reflecting our solid financial position, in May we paid a 50 pesos per share cash dividend funded from accumulated retained earnings.

Speaker 2

In addition, we will be paying two extraordinary dividends of 15 pesos per share each in September and another one in November. Capital expenditures in the quarter totaled $1.4 billion pesos, with most of these investments directed towards modernization and expansion projects at our Mexican average. This includes the ongoing work of the reconstruction and expansion of Terminal 1 at Cancún Airport and the terminal expansion in Oaxaca and Puerto Rico. We're currently advancing in the construction of taxiway hotels. All construction activities continue to take place outside operational areas to ensure no disruption to operational airport operations. Lastly, on the governance front, during the quarter Isabel Trieto was appointed to our Board of Directors as an independent member following the resignation of Mr. Ricardo Guajardo Touché. With this, 57% of our board is comprised of independent directors and female representation has increased to 36%. We thank Mr.

Speaker 2

Guajardo Touché for his valuable contribution and years of service on the board. Mrs. Trieto brings a wealth of experience in both public and private sector, beginning her career in financial services. To close, our second quarter performance underscores the resilience of our diversified portfolio and our sustained efficiency improvements. We continue investing in infrastructure, elevating passenger experience and delivering sustainable long term growth. We also remain attentive to evolving global macroeconomic conditions and believe our healthy financial position will help to mitigate potential risk. This concludes my prepared remarks. Christine, please open the floor for questions.

Speaker 1

Thank you. We will now begin the question and answer session. To ask a question, dial in by phone and press star then one on your telephone keypad, please. To mute, your mute function is turned off and if you are using a speakerphone, please pick up your headset before pressing the keys. To withdraw your question, press star then Q. At this time, we will pause momentarily to assemble our roster. Thank you. Our first question comes from the line of Jens Spiess with Morgan Stanley. Please proceed with your question.

Speaker 2

Yes, hello, Adolfo. Thanks for taking my questions. I have basically two. One is regarding non-aeronautical revenue. Just wondering what drove the sequential decline in non-aeronautical revenue. Was it mix of the types of passengers or anything else explaining it? Secondly, you already mentioned the U.S. Department of Transportation situation with the U.S. not impacting you. I was thinking that maybe one outcome might be that the capacity restrictions in Mexico City might be lifted, which would end up benefiting potentially the passenger traffic in the system as a whole. In case that materializes, how much of a positive impact would you expect?

Speaker 1

Thank you.

Speaker 2

Thank you. Jen Tan, good morning. In the case of non-aeronautical revenues, of course, the exchange rate played an important role during the quarter. I would say, of course, a slight difference in the passenger mix, international person, domestic, and also in the case of domestic, the segregation that we have in Terminal 2. In terms of your second question, I don't know if you saw 30 days ago that the Mexican government decided to increase or to ease the restriction they had in Mexico City Airport from 43 to 44. This announcement explained that they have made an analysis of the airspace in Mexico City and also an analysis of sediment buildings. That's why they decided to go from 42 to 43. One operation more in Mexico City Airport reflects more or less 1 million passenger traffic in that airport.

Speaker 2

I was expecting this restriction to be lifted towards the end of the year. I have my serious doubts that this will happen after what we saw in this announcement. The situation of the U.S. Department of Transportation came later and I believe the Mexican government will have to review the situation and see what is what they're going to say after what the U.S. Department of Transportation has expressed. As I said, the situation between the traffic to and from the U.S. from our airports, it's basically managed by U.S. airlines, as I said, out of Mexico, 0.3 in the case of Piva Morales, together 1.3%. So it's 1.8%, 1.6% of the total traffic between these two countries. I do not expect any major implication of this in our case.

Speaker 2

Of course, if as a result of this, the government decided to increase the operations in Mexico City, that would be beneficial to us. Okay, perfect. Thank you. Very clear. Thank you. You're welcome.

Speaker 1

Our next question comes to the line of Stephen Trent with Citi. Please proceed with your question.

Speaker 1

Good morning, Adolfo, and thanks very much for taking my question. Just quickly on Tulum, is this still the case that charter traffic is still sort of the primary piece of the pie that's leaving Cancún and shifting to Tulum? Or are you seeing a little bit more of a tilting commercial? Thank you.

Speaker 2

Hello?

Speaker 2

Yes, Adolfo, can you hear me?

Speaker 2

Could you repeat your question because you were, you and that.

Speaker 2

Sure, no problem. I was just curious in terms of what you're seeing in Tulum Airport and the traffic impact of Cancún. Am I thinking about this directly? It's still primarily charter traffic, that's the piece that's going there, or are you seeing a little more of a shift of commercial traffic there too? Thank you.

Speaker 2

Of course you can find some charter flights there, but basically I would say most of these is commercial flights basically coming from the U.S. A piece is coming from Mexico, but the most important region in that sense is U.S.

Speaker 2

Got it. Appreciate that. Just a very quick question on the balance sheet, I saw there was a $1.5 billion peso investment in financial instruments in Q1 that is no longer there in Q2. I was curious what was the rationale behind this shift. Thank you.

Speaker 2

rationale is the huge amount of money that we have in the bank in the investment. We decided to invest a piece of that in a fund instead of the usual instruments we have been in, just to try to get some more return for that amount of money.

Speaker 2

Okay, let me leave it there. Very helpful, thank you, Adolfo.

Speaker 1

Our next question comes to the line of Guilherme G. Mendes with JPMorgan. Please proceed with your question.

Speaker 1

Hi Adolfo.

Speaker 2

Good morning.

Speaker 2

Thanks for taking the time. The first question is on a follow-up on the traffic outlook. You mentioned at the beginning that you do expect some kind of normalization on Mexican traffic into next year. Just trying to understand what does it mean for the second half of this year. I understand that the base of comparison is relatively easier. Is it fair to assume that we could expect some kind of traffic growth, let's say mid single digits on Mexican traffic into 2H2025 when compared to 2H2024? The second question is on the FX impact. You mentioned the negative impact on aeronautical revenues. Can you clarify what is the actual impact on commercial revenues during the quarter? Thank you.

Speaker 2

Yes, the domestic traffic as you have seen with the numbers during the quarter is no longer decreasing. It was a small increase and basically this is because the engines problem of President Whitley is basically bottomed out. Polaris has expressed yesterday that they have six aircraft in the shop because of the problem. Exactly, and that was exactly the same figure we saw during the first quarter. This is the lowest part of the curve. I would say as we can see with the numbers from now on we should see an increase in domestic because of this. That is in my opinion the most important. Of course, the situation of Mexico City helps from these. As we said, there was a small increase in the restriction from 42 to 43. From now on everything should be better than how it was before.

Speaker 2

In the case of the effects in the commercial revenues, this has to do with the exchange rate activities there on one side. On the other side, it has to do with Unifree. Of course, what I have mentioned before, the situation we have in the case of Terminal 2. That's why you are seeing a very soft, I would say, non-aeronautical revenues in the second quarter compared with the first quarter this year.

Speaker 2

Maybe put in a different way, do you have high level numbers on what is the USD exposure you have on your commercial activity?

Speaker 2

It's not that easy because of course the only one that is related to U.S. dollars is free. The other thing is the way the people expense in terms of food and beverage prices are in pesos. That doesn't mean that the people will spend more if Mexican pesos appreciates, which is not the case in the stores. In the stores again, the prices are in pesos, but the people tend to spend more if the peso depreciates.

Speaker 2

Got it. Thank you, Adolfo. Have a nice day.

Speaker 2

You're welcome.

Speaker 1

Our next question comes from the line of Pablo Monsivais Mendoza with GBM. Please proceed with your question.

Speaker 1

Hi, good morning, Adolfo. A follow-up on the commercial readiness question. What should we expect for the next two quarters? With the situation you're naming on Terminal 2, should we expect again a couple of quarters of still a soft commercial revenue activity? My second question is maybe to put different, the question of what % of the rents that you have in your tenants at Cancún are in U.S. dollars. Thank you.

Speaker 2

In the case of Terminal 2, we should expect that for the next four quarters it will be up to the third quarter next year when we will be able to open the new reconstruction and extended Terminal 1, which should alleviate in a significant way the completion of Terminal 2. My prices or the way that we charge in the commercial revenues is basically a minimum guarantee payment per passenger and a percentage of the sales. Normally what they pay to us is a percentage of their sales. As I said before, if their sales are in pesos, this is four. That is not the currency. The thing that explains spending behavior has to do with the passenger wetness of these laws.

Speaker 2

In the past I used to say what Russia needs to us guys in the duty free and it has to do with the passenger, not with what is left.

Speaker 2

Okay, thank you very much.

Speaker 2

You're welcome.

Speaker 1

Our next question comes from the line of Pablo Ricalde Martinez with TRG Management LP. Please proceed with your questions.

Speaker 1

Hi, good morning, Alonso.

Speaker 1

I have two questions.

Speaker 1

The first one is from the Mexico profitability or EBITDA margin. I don't know if you can explain a little bit further what happened on the cost line you mentioned with an increase in labor costs and utilities. Just wondering if maybe you register a provision or something and that's why expenses do that much and profitability declines that much. How should we think of profitability in Mexico going forward? My second question is on your balance sheets and your cash imbalance in federal mistaken 60% of your cash speaking will be. I just want to better check that number.

Speaker 2

Yes, Pablo? In the case of the margin, I don't want to or I don't like to talk about margins because revenues and expenses are basically independent. The expenses side grew 7% and basically because of the annual wage increase of 12% and that's from the beginning of the year. It was less than what we had in the first quarter. We had to take some action there due to the situation of the weak traffic. The combination of both is what you're seeing, a decrease in the margin. That is something that you need to see on an independent basis.

Speaker 2

Okay.

Speaker 2

In the case of what you're saying in the balance sheet, what was your question?

Speaker 2

Which percentage of your cash is in USD? Try to understand what was the FX loss of your P&L. If I'm not mistaken, around 60% of your FX is in USD. All of your cash is in USD.

Speaker 2

Yeah. In addition, I think at the end of the quarter we had $700 million in dollars. Okay, thanks.

Speaker 1

Our next question comes from the line of Fernanda Recchia with BTG Pactual. Please proceed with your question.

Speaker 1

Good morning. Thank you for taking my question. Shu here from our side as well. The first on the dividend policy going forward, we saw that despite the payment of the first range, your leverage is in a pretty comfortable level. Just wondering what we can think about next year onwards, if we could expect such a good dividend payment like this in 2025. Second, still a follow up on Tulum. Maybe if you could elaborate a little bit further. When do you expect this airport to reach full capacity? When do you expect it to stop hurting Cancún figures? Thank you.

Speaker 2

Thank you, Fernanda. In the case of business for next year, let's try to conclude this year. We have another payment in September, 11th in November. We will have to evaluate.

Speaker 2

The.

Speaker 2

Situation for the year and the results of operations. Next year we will propose something to the boards and then to shareholders assembly. In the case of the Kudo network, if we see lack of months to Lumiere port reach around 1.5 million passengers. If we see the last of months end of December last year it was 1.2 million. There was an increase of 300,000 passengers during the first half of the year. I was expecting a better ramp up. If you go back to my first conference call of the year, I was expecting 2.9 million for this airport. Recent news basically showing cancellation of some routes, Bogotá, Detroit, vignette on some others, basically are saying to me that this airport will not reach what I was expecting.

Speaker 2

At the beginning of the year this airport should have, roughly speaking, 2.9 million in accordance with the location this airport has. Going back to your question, one will not be hurting from lease is once this airport reaches the 2.9 million. In the meantime, we will have to continue talking about the ramp up of Tulum.

Speaker 2

Okay, thank you very much.

Speaker 2

You're welcome.

Speaker 1

Our next question comes to the line of Andres Aguirre with GBM. Please receive your question.

Speaker 1

Good morning, Adolfo. Thanks for the call. Wondering if you could share the rationale behind the new debt, and given your current high cash balance, how are you thinking about deployment going forward and possibilities for further leverage for capex? Thank you.

Speaker 2

Hi Andres. One can you tell has to do with taxes and expenses in Cancún Airport. We thought that it was something important for us to maintain some cash on hand for the future, given the fact that the dividend. Proposed dividend. The proposed authorizing for this year is a substantial $24 dividend. It was important to be sure that we were able to fund that situation.

Speaker 2

Thank you.

Speaker 2

You're welcome.

Speaker 1

Our next question comes from the line of Abraham Fuentes Salinas with Santander. Please proceed with your question.

Speaker 1

Hi, good morning. We have seen a drop in the number of tourists that are visiting the U.S. Do you think that Mexico could capture any of those passengers? If that will be the case, when do you think we can begin to see it effect in terms of traffic?

Speaker 2

This is true. There are diminishing declines from all the regions in the U.S. in terms of tourism. We have approached some Canadian airlines and talk about this situation. Basically, what they're saying is that they will evaluate the situation towards the end of the year. If this continues, of course, they will jump into our region. For the moment, what they have expressed is that they do not want to lose their slots in their most important efforts in the U.S. I do believe that next year we will see some positive effect of this, basically from Canada and from Europe.

Speaker 2

Okay, thank you.

Speaker 1

Our next question comes from Enrique Soho with Fundamenta Capital. Please proceed with your question.

Speaker 1

Hi, Adolfo. Thank you for taking my question. I wanted to quickly dive into international traffic dynamics in Mexico. More specifically, during this first half of the year, we have seen traffic internationally fall 7.5% in the first Q and 4% in the second Q. None of this has been happening basically. With Tulum not ramping up, how do you expect international traffic to kind of continue in the second half of this year? We expect Tulum to basically ramp up in 2026, hence hindering growth next year.

Speaker 2

Thank you. As I said in the initial remarks, 38% of the decline this quarter in international traffic is related to Tulum airports. The difference is related to a weaker market from all the regions. All are negative: Canada, U.S., Europe, and South America. What to expect for the future? Let's see what economics on one side, macroeconomics on the other side. All of this situation with the U.S. migration policies and the case of cyber Medicare, with the situation of the visa for the Brazilians, the visa for the Peruvians, the mistreatment to Colombians. All of this has been analyzed by the Mexican government today. Also, considering that next year we will have some games of the World Cup in Mexico, they will have to do something about it.

Speaker 2

Great. Just a quick follow up, if I may. In terms of domestic passengers, we should not continue to see it falling. Do you expect a strong rebound? Do you see that when talking to Volaris and Viva Aerobus, or do you think it will be a more casual change? Thanks.

Speaker 2

I do expect a better behavior. No more decreases from the domestic and a slight decrease in the.

Speaker 2

Great. Thank you.

Speaker 2

You're welcome.

Speaker 1

Our next question comes to the line of Alberto Velez with UBS. Please proceed with your question.

Speaker 1

Thank you for taking my questions. One reminder, it's about capex. How should you expect the case of capex deployment for the next quarter? Quarter came a little bit below what consensus and Earth was expecting. How should we see the deployment of capex in the following quarters? Thank you very much.

Speaker 2

You're welcome. I have to say that in the case of the capex, we are above our internal budget, 40% billion, slightly above. What do we expect for the end of the year to comply with what we have written in our MVP? Roughly speaking, $7 billion pesos. Remember that most of this is tendered towards the capex.

Speaker 2

Okay, thank you.

Speaker 2

You're welcome.

Speaker 1

Again, if you have a question, please press star then 1. Our next question comes from the line of Alan Macias for BofA Securities. Please proceed with your question. Alan Macias, your line is live. Our next question comes from the line of Ernst Anton Mortenkotter with GBM. Please proceed with your question.

Speaker 1

Hi, Adolfo, thank you very much for the call. Just a quick one. I mean, aside from Cancún, in the smaller airports in Mexico, maybe like Mérida or Oaxaca, we've seen some steady performance. I was just wondering, what kind of dynamics are you seeing in those smaller airports? What would you expect going forward? I mean, anything interesting there?

Speaker 2

Every single airport, of course, has its own situation. I would say, let me go. Indication of Oaxaca public demonstrations in Oaxaca had affected, of course, pure solver. In the case of Mérida, it's growing less than how it was before, but it's still growing. It's maybe. In the case of Villahermosa and same security etc. traffic. Each one has its own personalized. We cannot generalize all of them.

Speaker 2

Okay, thank you.

Speaker 2

You welcome.

Speaker 1

Our next question comes to the line of Guilherme G. Mendes with JPMorgan. Please proceed with your question.

Speaker 1

Hey Adolfo, thanks for the follow up. A quick one on traffic. There has been a lot of news on increasing Sargassum in the Caribbean region. Is this kind of concerning in your view? Could it imply downside risks to your traffic assumptions for the second half of the year?

Speaker 2

In the case of Sargassum, I have to say if we go back to, we cannot say every three years, every five years, every seven years, you would have Sargassum in the region. The worst ever has been in 2018. Of what we have seen for this year, this may be the worst ever. A situation that is very difficult, of course, in terms of the seasonality of the year, summer is the most important. I would say after or during the tap water and hot water, you will see less Sargassum, what you will see for the summer. Yes, it's true that this year has been a very tough situation.

Speaker 2

Got it. Thank you.

Speaker 2

You're welcome.

Speaker 1

Our next question comes from the line of Fernanda Recchia with BTG Pactual. Please receive your question.

Speaker 1

Hello, Fernanda, just a quick follow up. Could you comment a little bit on your inorganic growth opportunities that you're currently providing?

Speaker 1

I don't know if you have any.

Speaker 1

Update on Davao Airport. Apart from that, is there any other opportunity that you're looking at?

Speaker 2

The history of Davao is still the same. We're still in the legal process of that. For the moment, the project is on hold, and yes, we are seeing some other opportunities.

Speaker 2

Okay, just a follow up here. We know that CCR is under a divestment process. Does this process make sense for you? Are you looking at it?

Speaker 2

I cannot comment on the other opportunities we are analyzing for the moment.

Speaker 2

Great, thank you.

Speaker 2

You're welcome.

Speaker 1

Our next question comes from the line of Alan Macias with BofA Securities. Please proceed with your question.

Speaker 1

Hi Alonso, good morning. Thank you for the call. Just if you can give us some color on what's happening or what are the drivers for international traffic in Puerto Rico and Colombia? They're growing double digit levels and if this is sustainable for the second half of this year. Thank you.

Speaker 2

You, Walter. In the case of Puerto Rico, I would say this has to do with what's happening there with concerts and everything related to music. Puerto Rico is really hot on that one, and some international traffic are taking opportunity to go there because of that. In the case of Colombia, basically it's a U.S.

Speaker 1

Mr. Castro, are you still connected?

Speaker 2

I'm connected, yes.

Speaker 1

Okay. Mr. Macias, is that the end of your question?

Speaker 1

Yes, thank you.

Speaker 1

Thank you. As a reminder, if you would like to ask a question, please press star then one on your telephone. Our next question comes from the line of Federico Galassi with BTG Pactual. Please proceed with your question.

Speaker 1

Hi, Adolfo. Thank you for taking my question.

Speaker 1

Quick question.

Speaker 1

In civilian operations, I can see a jump in cost of services in terms of revenues. The question is if there's any one off or if this is the level that we have to be thinking for Mexican operation in the near future.

Speaker 2

This is what you should expect from the coming quest.

Speaker 2

Okay. It's not No. 1 office, 100% collaboration.

Speaker 2

Yeah.

Speaker 2

Okay, thank you.

Speaker 2

You're welcome.

Speaker 1

That concludes the question and answer portion of today's conference call. I would like to turn it back over to Mr. Castro for closing remarks.

Speaker 2

Thank you, Christine. Thank you all again for joining us today for our second quarter 2025 conference call. We wish you a good day and goodbye.

Speaker 1

Ladies and gentlemen, that concludes ASUR's second quarter 2025 results conference call. We would like to thank you again for your participation. You may now disconnect.