Corporación América Airports S.A. (NYSE:CAAP) Q2 2023 Earnings Call Transcript August 18, 2023 10:00 AM ET

Company Participants

Patricio Inaki Esnaola - Head of IR

Martin Eurnekian - CEO

Jorge Arruda - CFO

Conference Call Participants

Jay Singh - Citi

Operator

Good morning, and welcome to the Corporación América Airports Second Quarter 2023 Earnings Conference Call. A slide presentation accompanies today's webcast and is available in the Investor section of the Corporación América Airports website. As a reminder, all participants will be in a listen-only mode. There will an opportunity to ask questions at the end of the presentation.

At this time, I would like to turn the call over to Patricio Inaki Esnaola, Head of Investor Relations. Patricio, please go ahead.

Patricio Inaki Esnaola

Thank you. Good morning, everyone, and thank you for joining us today. Speaking during today's call will be Martin Eurnekian, our Chief Executive Officer, and Jorge Arruda, our Chief Financial Officer.

Before we proceed, I would like to make the following safe harbor statement. Today's call will contain forward-looking statements, and I refer you to the forward-looking statements section of our earnings release and recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances.

Now, let me turn the call over to our CEO, Martin Eurnekian.

Martin Eurnekian

Thank you, Inaki. Hello, everyone, and welcome to our second quarter 2023 earnings call. I will kick off today's call by providing a summary of our financial highlights followed by a quick review of traffic and cargo trends. I will then turn the call to Jorge to go through our second quarter financial results.

We reported an outstanding quarter with robust performance across the board. Adjusted EBITDA reached yet another record of $151 million, up 27% when compared to second quarter 2019 with the adjusted EBITDA margin ex-IFRIC12 expanding 3.2 percentage points. This was achieved with passenger traffic approaching pre-pandemic levels.

Again, this quarter, all territories contributed with positive adjusted EBITDA, fueled by a strong rebound in travel demand and solid execution across operations. Revenues ex-IFRIC12 climbed 17% when compared to second quarter 2019, reflecting the good performance in both Aeronautical and Commercial revenues.

Costs in turn increased below revenue growth, reflecting the operating leverage we have built into the company. The increase in profitability, along with a slight reduction in net debt contributed to further lowering our leverage ratio to an all-time low of 1.8 times, reflecting the amazing work we have undertaken during and after the pandemic in connection with our commercial activities. On the CapEx front, we remain well on track with the execution of our fully funded CapEx programs in Argentina and Uruguay, and are actively and selectively looking to other airport concessions to continue expanding our airport network and delivering long-term value to our stakeholders.