Grupo Aeroportuario del Pacifico Announces Results for the First Quarter of 2021

GUADALAJARA, Mexico, April 29, 2021 (GLOBE NEWSWIRE) — Grupo Aeroportuario del Pacifico, S.A.B. de C.V. (NYSE: PAC; BMV: GAP) (“the Company” or “GAP”) reported its consolidated results for the first quarter ended March 31, 2021 (1Q21). Figures are unaudited and have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).

COVID-19 Impact

During the first quarter of the year, the COVID-19 pandemic continued to affect the Company’s results, mainly due to the decrease in domestic and international passenger traffic compared to 1Q20. Containment steps, such as those taken by the United States government which expanded the requirement for negative COVID-19 testing for all air passengers entering the United States beginning January 26, 2021 also affected passenger traffic. As of January 7, 2021, there were similar testing requirements for air passengers traveling to Canada, and subsequently, the Canadian government suspended flights between Mexico and the Caribbean, further contributing to a decrease in passenger traffic levels compared to 1Q20.

As previously mentioned, the degree of recovery of the Company’s operations and results will depend on the duration and containment of the pandemic by the Mexican, Jamaican and U.S. governments, as the main origin-destination. Due to the nature of the pandemic, the Company cannot fully estimate the impact on its financial situation or operating results in the short, medium or long term. However, the rate of vaccination by the U.S. government may aid in a sooner than expected recovery in international traffic, mainly at the Company’s airports in tourist destinations.

Company measures during 1Q21:

  • The Company continued to offer support to airlines and its commercial clients. For commercial contracts, the Company granted discounts on guaranteed minimum rental amounts in accordance with the percentage decrease in passenger traffic at each airport compared to the 1Q21, thereby maintaining the Company’s percentage of participation in revenues. With regards to the airlines, the Company continued its incentive program in accordance with the reactivation of routes and frequencies that were held prior to the pandemic.
  • Operating cost control measures were maintained throughout most of the expense line items; however, in the 1Q21 there was an increase in the expense line items compared to the previous quarter driven by the increase in passenger traffic at each airport.

Impact of COVID-19 on the Company’s Financial Position:

Despite pandemic-related effects causing a significant decline in 1Q21 revenue, the Company continues generating positive EBITDA. Controlling cost of services and negotiating a decrease in concession taxes and technical assistance fees, enabled the Company to mitigate the impact of the COVID-19 pandemic on revenues.

During 1Q21, the Company generated a positive cash flow in operating activities, even though it was significantly lower than the cash flow for 1Q20. The Company reported a solid financial position at the close of 1Q21, cash and cash equivalents on March 31, 2021 were Ps. 14,728.4 million (a 34.2% increase as compared to 1Q20). During 1Q21, the Company completed the refinancing of the US$ 191.0 million, that were due in January and February 2021.

During 1Q21, the Company continued evaluating the possible adverse impacts of the pandemic on its financial condition and operating results. The Company also reviewed key indicators and impairment tests of significant long-term assets, expected credit losses and recovery of assets due to deferred taxes. In this evaluation, the Company reviewed financial results for the short, medium, and long term, concluding that a significant deterioration of the Company’s assets is not expected. As such, the Company does not foresee a business interruption or closing operations at any of its airports. However, the Company cannot ensure that the negative effect of the pandemic will be less in the coming quarter, nor can it ensure that local and global economic conditions will improve. The Company can also not predict the availability of financing, or what general credit conditions will be.

The Company will continue to monitor the pandemic’s adverse effects on the results of operations, including the monitoring of key indicators, impairment tests, projections, budgets, fair values, future cash flow related to the recovery of significant financial and non-financial assets, as well as possible contingencies.

During 1Q21, the Company performed a risk evaluation of accounts receivable from airlines and commercial clients in terms of liquidity. As a result, the Company is recognizing an allowance for credit losses of Ps. 23.5 million in operating costs.

The Company will continue informing the market in a timely manner regarding future material updates on airport operations and the measures adopted for preserving liquidity and going concern.

Summary of Results 1Q21 vs. 1Q20

  • The sum of aeronautical and non-aeronautical services revenues decreased by Ps. 1,436.9 million, or 34.7%. Total revenues decreased by Ps. 1,330.8 million, or 26.8%.
  • Cost of services decreased by Ps. 83.9 million, or 11.4%.
  • Income from operations decreased by Ps. 1,087.5 million, or 46.4%.
  • EBITDA decreased by Ps. 1,066.8 million, or 37.8%, going from Ps. 2,824.0 million in 1Q20 to Ps.1,757.2 million in 1Q21. EBITDA margin (excluding the effects of IFRIC 12) decreased from 68.2% in 1Q20 to 65.0% in 1Q21.
  • Net comprehensive income decreased Ps. 1,848.0 million, from Ps. 3,165.2 million in 1Q20 to Ps. 1,317.2 million, or (58.4%) in 1Q21.

Passenger Traffic

During 1Q21, total terminal passengers at the Company’s 14 airports decreased by 4,318.1 thousand passengers, a decrease of 36.8%, compared to 1Q20. During 1Q21, there were no new route openings. On March 31, 2020, the Mexican government declared a national health emergency due to COVID-19 pandemic, suspending non-essential activities until May 31, 2020, therefore the effects of the pandemic on passenger traffic were reflected significantly from that date.

Domestic Terminal Passengers – 14 airports (in thousands):

Airport 1Q20 1Q21 Change
Guadalajara 2,336.5 1,573.6 (32.7 %)
Tijuana * 1,420.1 1,410.7 (0.7 %)
Los Cabos 402.7 366.9 (8.9 %)
Puerto Vallarta 367.8 300.4 (18.3 %)
Guanajuato 424.6 286.0 (32.6 %)
Montego Bay 1.0 0.0 (100.0 %)
Hermosillo 396.1 257.6 (35.0 %)
Mexicali 277.0 190.2 (31.3 %)
Morelia 125.8 109.9 (12.7 %)
La Paz 213.5 169.1 (20.8 %)
Aguascalientes 137.6 97.7 (29.0 %)
Kingston 1.3 0.1 (90.8 %)
Los Mochis 86.8 70.9 (18.3 %)
Manzanillo 23.2 17.1 (26.2 %)
Total 6,213.9 4,850.4 (21.9 %)

*CBX users are classified as international passengers.

International Terminal Passengers – 14 airports (in thousands):

Airport 1Q20 1Q21 Change
Guadalajara 957.8 595.0 (37.9 %)
Tijuana * 684.3 424.8 (37.9 %)
Los Cabos 947.1 534.4 (43.6 %)
Puerto Vallarta 1,086.3 352.5 (67.6 %)
Guanajuato 148.2 85.4 (42.4 %)
Montego Bay 1,132.9 304.7 (73.1 %)
Hermosillo 18.8 19.9 5.8 %
Mexicali 1.2 0.7 (42.7 %)
Morelia 99.6 75.1 (24.6 %)
La Paz 3.3 4.0 19.3 %
Aguascalientes 48.4 33.9 (30.0 %)
Kingston 353.5 115.4 (67.4 %)
Los Mochis 1.3 1.6 23.7 %
Manzanillo 28.5 9.4 (67.0 %)
Total 5,511.2 2,556.5 (53.6 %)

*CBX users are classified as international passengers.

Total Terminal Passengers – 14 airports (in thousands):

Airport 1Q20 1Q21 Change
Guadalajara 3,294.4 2,168.5 (34.2 %)
Tijuana * 2,104.3 1,835.5 (12.8 %)
Los Cabos 1,349.8 901.3 (33.2 %)
Puerto Vallarta 1,454.1 652.9 (55.1 %)
Guanajuato 572.9 371.4 (35.2 %)
Montego Bay 1,133.9 304.7 (73.1 %)
Hermosillo 414.9 277.4 (33.1 %)
Mexicali 278.2 190.9 (31.4 %)
Morelia 225.4 184.9 (18.0 %)
La Paz 216.9 173.1 (20.2 %)
Aguascalientes 186.0 131.7 (29.2 %)
Kingston 354.8 115.5 (67.4 %)
Los Mochis 88.0 72.5 (17.7 %)
Manzanillo 51.7 26.5 (48.7 %)
Total 11,725.0 7,406.9 (36.8 %)

*CBX users are classified as international passengers.

CBX Users (in thousands):

Airport 1Q20 1Q21 Change
Tijuana 677.3 421.0 (37.8 %)

Consolidated Results for the First Quarter of 2021 (in thousands of pesos):

1Q20 1Q21 Change
Revenues
Aeronautical services 3,123,782 2,072,767 (33.6 %)
Non-aeronautical services 1,021,842 635,987 (37.8 %)
Improvements to concession assets (IFRIC 12) 823,215 929,243 12.9 %
Total revenues 4,968,839 3,637,996 (26.8 %)
Operating costs
Costs of services: 736,558 652,698 (11.4 %)
Employee costs 247,206 243,634 (1.4 %)
Maintenance 114,403 94,439 (17.5 %)
Safety, security & insurance 125,326 123,826 (1.2 %)
Utilities 91,627 77,173 (15.8 %)
Other operating expenses 157,996 113,626 (28.1 %)
Technical assistance fees 132,265 88,356 (33.2 %)
Concession taxes 443,706 213,840 (51.8 %)
Depreciation and amortization 482,057 502,745 4.3 %
Cost of improvements to concession assets (IFRIC 12) 823,215 929,243 12.9 %
Other income 9,080 (3,350 ) (136.9 %)
Total operating costs 2,626,881 2,383,532 (9.3 %)
Income from operations 2,341,958 1,254,464 (46.4 %)
Financial Result (15,094 ) (79,304 ) 425.4 %
Share of loss of associates 86 1 98.8 %
Income before income taxes 2,326,950 1,175,161 (49.5 %)
Income taxes (518,887 ) (137,581 ) (73.5 %)
Net income 1,808,063 1,037,580 (42.6 %)
Currency translation effect 1,417,364 61,729 (95.6 %)
Cash flow hedges, net of income tax (60,108 ) 216,794 (460.7 %)
Remeasurements of employee benefit – net income tax (147 ) 1,102 (849.7 %)
Comprehensive income 3,165,172 1,317,205 (58.4 %)
Non-controlling interest (193,754 ) (12,895 ) 93.3 %
Comprehensive income attributable to controlling interest 2,971,419 1,304,310 (56.1 %)
1Q20 1Q21 Change
EBITDA 2,824,015 1,757,209 (37.8 %)
Comprehensive income 3,165,172 1,317,205 (58.4 %)
Comprehensive income per share (pesos) 6.0223 2.5136 (58.3 %)
Comprehensive income per ADS (US dollars) 2.9462 1.2297 (58.3 %)
Operating income margin 47.1 % 34.5 % (26.8 %)
Operating income margin (excluding IFRIC 12) 56.5 % 46.3 % (18.0 %)
EBITDA margin 56.8 % 48.3 % (15.0 %)
EBITDA margin (excluding IFRIC 12) 68.2 % 65.0 % (4.9 %)
Costs of services and improvements / total revenues 31.4 % 43.5 % 38.5 %
Cost of services / total revenues (excluding IFRIC 12) 17.8 % 24.1 % 35.6 %

– Net income and comprehensive income per share for the 1Q21 were calculated based on 524,038,200 outstanding shares and for the 1Q20 were calculated based on 525,575,547 outstanding shares. U.S. dollar figures presented were converted from pesos to U.S. dollars at a rate of Ps. 20.4410 per U.S. dollar (the noon buying rate on March 31, 2021, as published by the U.S. Federal Reserve Board).
– For purposes of the consolidation of the Montego Bay and Kingston airports, the average three-month exchange rate of Ps. 20.3190 per U.S. dollar for the three months ended March 31, 2021 was used.

Revenues (1Q21 vs. 1Q20)

  • Aeronautical services revenues decreased by Ps. 1,051.0 million, or 33.6%.
  • Non-aeronautical services revenues decreased by Ps. 385.9 million, or 37.8%.
  • Revenues from improvements to concession assets increased by Ps. 106.0 million, or 12.9%.
  • Total revenues decreased by Ps. 1,330.8 million, or 26.8%.
  • The change in aeronautical services revenues was composed primarily of the following factors:
    1. Revenues at the Company’s Mexican airports decreased by Ps. 671.3 million or 26.6% compared to 1Q20, mainly as a result of the decrease in passenger traffic of 31.7%, partially offset by the increase in maximum tariff applicable to 2021 pursuant to the adjustments to our Master Development Program as a result of the Extraordinary Review. Even though the increase approved to the maximum tariff was not reached in this quarter, it is expected to be reached by the end of 2021. As international passenger traffic picks up, the Company will be closer to the cap of the maximum tariff.
    2. Revenues from the Montego Bay airport decreased by Ps. 321.1 million, or 70.3%, compared to 1Q20. This was mainly due to the 73.1% decrease in passenger traffic. The passenger traffic decline was partially offset by the 2.3% depreciation of the peso versus the U.S. dollar during 1Q21, which went from an average exchange rate of Ps. 19.8551 in 1Q20 to Ps. 20.3190 in 1Q21.
    3. Revenues from the Kingston airport declined by Ps. 58.6 million, or 41.6% compared to 1Q20, mainly due to a 67.4% decrease in passenger traffic. The increase in passenger fees beginning April 2020, as well as the depreciation of the peso versus the dollar, partially offset the decrease in passenger traffic.
  • The change in non-aeronautical services revenues was composed primarily of the following factors:
    1. The Mexican airports decreased by Ps. 292.6 million, or 35.5%, compared to 1Q20. Revenues from businesses operated by third parties decreased by Ps. 175.0 million. This was mainly due to a decrease in revenues from time shares, food and beverage, duty-free stores, retail and car rentals, which jointly decreased by Ps. 172.8 million, or 37.5%. Revenues from businesses operated directly by the Company decreased by Ps. 100.5 million, or 42.9%, while the recovery of costs decreased by Ps. 17.2 million, or 34.8%.
    2. Revenues from the Montego Bay airport decreased by Ps. 68.4 million, or 47.0%, compared to 1Q20. Revenues in U.S. dollars decreased by US$ 3.5 million, or 48.2%. However, the 2.3% depreciation of the peso versus the dollar partially offset the revenue decrease in 1Q21.
    3. Revenues from the Kingston airport declined by Ps. 24.9 million, or 47.6%, compared to 1Q20. Revenues in U.S. dollars decreased by US$ 1.3 million, or 48.4%.
1Q20 1Q21 Change
Businesses operated by third parties:
Duty-free 152,027 81,342 (46.5 %)
Food and beverage 144,746 81,489 (43.7 %)
Retail 106,421 65,476 (38.5 %)
Car rentals 110,376 80,707 (26.9 %)
Leasing of space 55,710 49,030 (12.0 %)
Time shares 52,458 30,364 (42.1 %)
Ground transportation 38,260 26,641 (30.4 %)
Communications and financial services 31,108 16,351 (47.4 %)
Other commercial revenues 25,516 26,894 5.4 %
Total 716,622 458,295 (36.0 %)
Businesses operated directly by us:
Car parking 78,105 69,344 (11.2 %)
VIP lounges 81,286 31,771 (60.9 %)
Advertising 33,934 10,443 (69.2 %)
Convenience stores 50,270 25,193 (49.9 %)
Total 243,595 136,751 (43.9 %)
Recovery of costs 61,624 40,940 (33.6 %)
Total Non-aeronautical Revenues 1,021,842 635,987 (37.8 %)

Figures expressed in thousands of Mexican pesos.

  • Revenues from improvements to concession assets1
    Revenues from improvements to concession assets (IFRIC 12) increased by Ps. 106.0 million, or 12.9%, compared to 1Q20, mainly in:
    1. The Company’s Mexican airports, which increased by Ps. 102.3 million, or 12.7%, as a result of the adjusted Master Development Program for the 2020-2024 period.
    2. Improvements to concession assets at the Montego Bay airport increased Ps. 3.7 million, or 23.2%. During 1Q21 no investments in improvements to concession assets were made at the Kingston airport.

Total operating costs decreased by Ps. 243.3 million, or 9.3%, compared to 1Q20, mainly due to a Ps. 273.8 million, or 47.5%, decrease in concession taxes and technical assistance fees, and a Ps. 83.9 million, or 11.4% decrease in cost of services. This decrease was partially offset by a Ps. 106.0 million, or 12.9%, increase in the cost of improvements to the concession assets (IFRIC 12). Excluding the cost of improvements to concession assets, operating costs decreased Ps. 349.4 million, or 19.4%. This was composed primarily of the following factors:

Mexican Airports:

  • Operating costs decreased by Ps. 10.8 million or 0.5%, compared to 1Q20, despite the Ps. 102.3 million, or 12.7%, increase in the cost of improvements to the concession assets (IFRIC 12) (excluding this cost, operating costs decreased by Ps. 113.1 million or 9.4%), primarily due to the Ps. 32.2 million, or 6.0%, decrease in cost of services, the Ps. 91.4 million, or 30.6%, decrease in technical assistance fees and concession taxes, as a result of the decrease in revenues. These decreases were also partially offset by a Ps. 15.2 million, or 4.1%, increase in depreciation and amortization.

The decline in the cost of services was mainly due to the cost containment program during 1Q21:

  • Other operating expenses decreased by Ps. 20.0 million, or 17.1%, compared to 1Q20, mainly due to a Ps. 34.4 million, or 44.7% decrease in professional service fees, travel costs, marketing expenses, cost of sales in the VIP lounges and convenience stores, and expenses for FBO services. This decrease was partially offset by a Ps. 15.0 million increase in the allowance for expected credit losses.
  • Maintenance costs decreased by Ps. 10.1 million, or 11.6%, compared to 1Q20.
  • Utilities decreased by Ps. 8.9 million, or 16.3%, compared to 1Q20, mainly due to a decrease in electric energy and water consumption which saved Ps. 7.6 million.

Montego Bay Airport:

Operating costs decreased by Ps. 152.1 million, or 36.6% compared to 1Q20, mainly due to the decrease in concession taxes of Ps. 134.4 million, or 82.3%, cost of services of Ps. 18.5 million, or 16.6%, and cost of improvements to the concession assets (IFRIC 12) of Ps. 3.7 million, or 23.1%, which were partially offset by a Ps. 4.9 million, or 4.2%, increase in depreciation and amortization. Operating costs in U.S. dollars declined by US$ 7.4 million.

Kingston Airport:

Operating costs decreased by Ps. 80.5 million, or 39.3% in 1Q21 compared to 1Q20, mainly due to a Ps. 48.0 million, or 42.0%, decrease in concession taxes and a Ps. 33.1 million, or 37.4%, decrease in the cost of services. Operating costs in U.S. dollars declined by US$ 3.9 million.

Operating margin for 1Q21 declined by 1,260 basis points, from a margin of 47.1% in 1Q20 to a margin of 34.5% in 1Q21. Excluding the effects of IFRIC 12, operating margin declined by 1,020 basis points, from 56.5% to 46.3% in 1Q21. Operating income decreased by Ps. 1,087.5 million, or 46.4%, compared to 1Q20.

EBITDA margin decreased by 850 basis points, from 56.8% in 1Q20 to 48.3% in 1Q21. Excluding the effects of IFRIC-12, EBITDA margin decreased by 320 basis points, from 68.2% in 1Q20 to 65.0% in 1Q21. The nominal value of EBITDA was Ps. 1,757.2 million in 1Q21, compared to Ps. 2,824.0 million in 1Q20, representing a decrease of 37.8%.

Financial cost increased by Ps. 64.2 million, from a net expense of Ps. 15.1 million in 1Q20 to a net expense of Ps. 79.3 million in 1Q21. This increase was mainly the result of:

  • Foreign exchange rate fluctuations, which went from income of Ps. 236.4 million in 1Q20 to income of Ps. 219.9 million in 1Q21, generated a decrease in the foreign exchange gain of Ps. 16.5 million. The currency translation effect represented a decrease of Ps. 1,355.6 million, compared to 1Q20.
  • An increase in interest expenses of Ps. 38.7 million, or 11.2%, compared to 1Q20, mainly due to higher debt as a result of the issuance of long-term bonds and bank debt disbursed during 2020.
  • Interest income declined by Ps. 8.7 million, or 9.2%, compared to 1Q20, mainly due to the decline in interest rates.

In 1Q21, comprehensive income decreased Ps. 1,848.0 million, or 58.4% compared to 1Q20. This effect was mainly the result of a decrease in the currency translation effect gain of Ps. 1,355.6 million, mainly due to a 24.8% depreciation of the Mexican peso against the U.S. dollar in 1Q20 as compared to a depreciation of 2.3% in 1Q21, as well as the substantial decrease in passenger traffic, which generated lower revenues for 1Q21.

During 1Q21, net income decreased by Ps. 770.5 million, or 42.6% compared to 1Q20. Income taxes decreased by Ps. 381.1 million, or 73.5%, due to a decline of Ps. 301.6 million in income taxes and a Ps. 79.7 million increase in the benefit for deferred tax, mainly due to a higher inflation rate, that went from 1.21% in 1Q20 to 2.34% in 1Q21.

Statement of Financial Position

Total assets as of March 31, 2021 increased by Ps. 4,602.1 million as compared to March 31, 2020, primarily due to the following items: (i) cash and equivalents of Ps. 3,754.5 million; (ii) improvements to concession assets of Ps. 1,040.2 million; and (iii) recoverable tax on assets and other assets of Ps. 679.5 million. This was partially offset by a Ps. 910.2 million decrease in the value of concession assets, among others.

Total liabilities as of March 31, 2021 increased by Ps. 4,604.9 million compared to March 31, 2020. This increase was primarily due to the following items: (i) issuance of Ps. 4,200.0 million in long-term bonds and (ii) bank loans of Ps. 1,995.4 million. This was partially offset by decreases of: (i) Ps. 460.5 million in guaranteed deposits, (ii) Ps. 449.7 million in concession taxes and (iii) Ps. 231.8 million in deferred taxes, among others.

Recent events

On March 1, 2021, the Company began repurchasing its Series “B” shares, in accordance with the approval in the Ordinary General Shareholders’ Meeting held on July 1, 2020. As of the date of this report, the Company has repurchased 2,439,196 shares at an average price of Ps. 217.81 per share, for a total of Ps. 531.3 million.

Company Description

Grupo Aeroportuario del Pacifico, S.A.B. de C.V. (GAP) operates 12 airports throughout Mexico’s Pacific region, including the major cities of Guadalajara and Tijuana, the four tourist destinations of Puerto Vallarta, Los Cabos, La Paz and Manzanillo, and six other mid-sized cities: Hermosillo, Guanajuato, Morelia, Aguascalientes, Mexicali and Los Mochis. In February 2006, GAP’s shares were listed on the New York Stock Exchange under the ticker symbol “PAC” and on the Mexican Stock Exchange under the ticker symbol “GAP”. In April 2015, GAP acquired 100% of Desarrollo de Concesiones Aeroportuarias, S.L., which owns a majority stake in MBJ Airports Limited, a company operating Sangster International Airport in Montego Bay, Jamaica. In October 2018, GAP entered into a concession agreement for the operation of the Norman Manley International Airport in Kingston, Jamaica and took control of the operation in October 2019.

This press release contains references to EBITDA, a financial performance measure not recognized under IFRS and which does not purport to be an alternative to IFRS measures of operating performance or liquidity. We caution investors not to place undue reliance on non-GAAP financial measures such as EBITDA, as these have limitations as analytical tools and should be considered as a supplement to, not a substitute for, the corresponding measures calculated in accordance with IFRS.

This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management’s current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words “anticipates”, “believes”, “estimates”, “expects”, “plans” and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.

In accordance with Section 806 of the Sarbanes-Oxley Act of 2002 and article 42 of the “Ley del Mercado de Valores”, GAP has implemented a “whistleblower” program, which allows complainants to anonymously and confidentially report suspected activities that may involve criminal conduct or violations. The telephone number in Mexico, facilitated by a third party that is in charge of collecting these complaints, is 01 800 563 00 47. The web site is www.lineadedenuncia.com/gap. GAP’s Audit Committee will be notified of all complaints for immediate investigation.

Exhibit A: Operating results by airport (in thousands of pesos):

Airport 1Q20 1Q21 Change
Guadalajara
Aeronautical services 805,407 626,719 (22.2 %)
Non-aeronautical services 219,189 161,949 (26.1 %)
Improvements to concession assets (IFRIC 12) 258,940 281,771 8.8 %
Total Revenues 1,283,535 1,070,439 (16.6 %)
Operating income 679,135 481,125 (29.2 %)
EBITDA 770,159 584,062 (24.2 %)
Tijuana
Aeronautical services 380,298 332,362 (12.6 %)
Non-aeronautical services 117,202 86,762 (26.0 %)
Improvements to concession assets (IFRIC 12) 143,260 405,221 182.9 %
Total Revenues 640,760 824,345 28.7 %
Operating income 304,215 230,867 (24.1 %)
EBITDA 366,375 299,333 (18.3 %)
Los Cabos
Aeronautical services 430,401 324,257 (24.7 %)
Non-aeronautical services 215,532 129,069 (40.1 %)
Improvements to concession assets (IFRIC 12) 162,350 98,748 (39.2 %)
Total Revenues 808,283 552,073 (31.7 %)
Operating income 451,222 270,708 (40.0 %)
EBITDA 516,548 334,819 (35.2 %)
Puerto Vallarta
Aeronautical services 454,549 225,766 (50.3 %)
Non-aeronautical services 141,526 69,041 (51.2 %)
Improvements to concession assets (IFRIC 12) 113,707 77,359 (32.0 %)
Total Revenues 709,782 372,166 (47.6 %)
Operating income 437,021 163,360 (62.6 %)
EBITDA 477,683 210,087 (56.0 %)
Montego Bay
Aeronautical services 456,561 135,424 (70.3 %)
Non-aeronautical services 145,653 77,238 (47.0 %)
Improvements to concession assets (IFRIC 12) 15,987 19,696 23.2 %
Total Revenues 618,202 232,357 (62.4 %)
Operating income (loss) 203,512 (30,306 ) (114.9 %)
EBITDA 320,116 91,315 (71.5 %)

Exhibit A: Operating results by airport (in thousands of pesos): (continued)

Airport 1Q20 1Q21 Change
Guanajuato
Aeronautical services 141,747 99,876 (29.5 %)
Non-aeronautical services 46,977 26,520 (43.5 %)
Improvements to concession assets (IFRIC 12) 32,469 3,094 (90.5 %)
Total Revenues 221,193 129,489 (41.5 %)
Operating income 122,887 69,180 (43.7 %)
EBITDA 140,270 87,722 (37.5 %)
Hermosillo
Aeronautical services 82,969 60,789 (26.7 %)
Non-aeronautical services 24,291 15,851 (34.7 %)
Improvements to concession assets (IFRIC 12) 4,347 4,341 (0.1 %)
Total Revenues 111,607 80,981 (27.4 %)
Operating income 47,684 22,385 (53.1 %)
EBITDA 66,701 42,673 (36.0 %)
Others (1)
Aeronautical services 371,849 267,575 (28.0 %)
Non-aeronautical services 109,734 68,675 (37.4 %)
Improvements to concession assets (IFRIC 12) 92,155 39,014 (57.7 %)
Total Revenues 573,739 375,263 (34.6 %)
Operating income 80,573 15,540 (80.7 %)
EBITDA 139,389 81,749 (41.4 %)
Total
Aeronautical services 3,123,782 2,072,767 (33.6 %)
Non-aeronautical services 1,020,105 635,104 (37.7 %)
Improvements to concession assets (IFRIC 12) 823,215 929,243 12.9 %
Total Revenues 4,967,102 3,637,114 (26.8 %)
Operating income (loss) 2,326,250 1,222,859 (47.4 %)
EBITDA 2,797,241 1,731,761 (38.1 %)

(1) Others include the operating results of the Aguascalientes, La Paz, Los Mochis, Manzanillo, Mexicali, Morelia and Kingston airports.

Exhibit B: Consolidated statement of financial position as of March 31 (in thousands of pesos):

2020 2021 Change %
Assets
Current assets
Cash and cash equivalents 10,973,890 14,728,391 3,754,501 34.2 %
Trade accounts receivable – net 1,838,539 1,318,636 (519,903 ) (28.3 %)
Other current assets 482,747 1,162,282 679,535 140.8 %
Total current assets 13,295,176 17,209,309 3,914,133 29.4 %
Advanced payments to suppliers 396,717 466,306 69,589 17.5 %
Machinery, equipment and improvements to leased buildings – net 1,923,125 2,307,962 384,837 20.0 %
Improvements to concession assets – net 12,806,135 13,846,300 1,040,165 8.1 %
Airport concessions – net 11,570,119 10,659,934 (910,185 ) (7.9 %)
Rights to use airport facilities – net 1,336,849 1,263,452 (73,397 ) (5.5 %)
Deferred income taxes 5,788,002 6,063,843 275,841 4.8 %
Other non-current assets 210,448 111,566 (98,882 ) (47.0 %)
Total assets 47,326,570 51,928,672 4,602,103 9.7 %
Liabilities
Current liabilities 2,522,435 4,992,770 2,470,335 97.9 %
Long-term liabilities 20,969,520 23,104,100 2,134,581 10.2 %
Total liabilities 23,491,955 28,096,870 4,604,915 19.6 %
Stockholders’ Equity
Common stock 6,185,082 6,185,082 0.0 %
Legal reserve 1,592,551 1,592,551 0.0 %
Net income 1,776,946 1,050,154 (726,792 ) (40.9 %)
Retained earnings 9,940,034 11,908,890 1,968,856 19.8 %
Reserve for share repurchase 3,283,374 3,283,374 0.0 %
Repurchased shares (1,733,374 ) (2,071,558 ) (338,184 ) 19.5 %
Foreign currency translation reserve 1,780,720 1,073,704 (707,016 ) (39.7 %)
Remeasurements of employee benefit – Net 6,459 (8,950 ) (15,409 ) (238.6 %)
Cash flow hedges- Net (232,202 ) (254,312 ) (22,110 ) 9.5 %
Total controlling interest 22,599,590 22,758,935 159,345 0.7 %
Non-controlling interest 1,235,024 1,072,867 (162,157 ) (13.1 %)
Total stockholders’ equity 23,834,614 23,831,802 (2,812 ) (0.0 %)
Total liabilities and stockholders’ equity 47,326,570 51,928,672 4,602,103 9.7 %

The non-controlling interest corresponds to the 25.5% stake held in the Montego Bay airport by Vantage Airport Group Limited (“Vantage”).

Exhibit C: Consolidated statement of cash flows (in thousands of pesos):

1Q20 1Q21 Change
Cash flows from operating activities:
Consolidated net income (loss) 1,808,063 1,037,580 (42.6 %)
Postemployment benefit costs 4,618 8,900 92.7 %
Allowance expected credit loss 45,967 23,525 (48.8 %)
Depreciation and amortization 482,057 502,745 4.3 %
(Gain) loss on sale of machinery, equipment and improvements to leased assets (3,052 ) 596 (119.5 %)
Interest expense 314,181 381,139 21.3 %
Share of profit of associate (86 ) (1 ) (98.8 %)
Provisions (2,230 ) (12,312 ) 452.1 %
Income tax expense 518,887 137,581 (73.5 %)
Unrealized exchange loss 764,683 163,039 (78.7 %)
Net loss on derivative financial instruments 28,442 (100.0 %)
3,961,530 2,242,792 (43.4 %)
Changes in working capital:
(Increase) decrease in
Trade accounts receivable (329,389 ) (73,688 ) (77.6 %)
Recoverable tax on assets and other assets 159,593 (56,433 ) (135.4 %)
Increase (decrease) in
Concession taxes payable 35,282 (43,092 ) (222.1 %)
Accounts payable 222,349 41,644 (81.3 %)
Cash generated (used) by operating activities 4,049,365 2,111,221 (47.9 %)
Income taxes paid (476,789 ) (302,349 ) (36.6 %)
Net cash flows provided by operating activities 3,572,576 1,808,872 (49.4 %)
Cash flows from investing activities:
Machinery, equipment and improvements to concession assets (638,038 ) (829,935 ) 30.1 %
Cash flows from sales of machinery and equipment 165 651 294.5 %
Other investment activities (14,384 ) 3,205 (122.3 %)
Net cash used by investment activities (652,257 ) (826,079 ) 26.6 %
Cash flows from financing activities:
Debt securities 3,000,000 (100.0 %)
Payment from Debt securities (2,200,000 ) (100.0 %)
Bank loans (1,889,706 ) 100.0 %
Repurchase of shares (338,184 ) 100.0 %
Interest paid (351,298 ) (339,197 ) (3.4 %)
Bank Loans 1,889,706 100.0 %
Interest paid on lease (717 ) (502 ) (30.0 %)
Payments of obligations for leasing (3,652 ) (3,059 ) (16.2 %)
Net cash flows used in financing activities 444,333 (680,942 ) (253.3 %)
Effects of exchange rate changes on cash held 109,045 (18,009 ) (116.5 %)
Net increase in cash and cash equivalents 3,473,698 283,842 (91.8 %)
Cash and cash equivalents at beginning of year 7,500,193 14,444,549 92.6 %
Cash and cash equivalents at the end of year 10,973,890 14,728,391 34.2 %

Exhibit D: Consolidated statements of profit or loss and other comprehensive income (in thousands of pesos):

1Q20 1Q21 Change
Revenues
Aeronautical services 3,123,782 2,072,767 (33.6 %)
Non-aeronautical services 1,021,842 635,987 (37.8 %)
Improvements to concession assets (IFRIC 12) 823,215 929,243 12.9 %
Total revenues 4,968,839 3,637,996 (26.8 %)
Operating costs
Costs of services: 736,558 652,698 (11.4 %)
Employee costs 247,206 243,634 (1.4 %)
Maintenance 114,403 94,439 (17.5 %)
Safety, security & insurance 125,326 123,826 (1.2 %)
Utilities 91,627 77,173 (15.8 %)
Other operating expenses 157,996 113,626 (28.1 %)
Technical assistance fees 132,265 88,356 (33.2 %)
Concession taxes 443,706 213,840 (51.8 %)
Depreciation and amortization 482,057 502,745 4.3 %
Cost of improvements to concession assets (IFRIC 12) 823,215 929,243 12.9 %
Other income 9,080 (3,350 ) (136.9 %)
Total operating costs 2,626,881 2,383,532 (9.3 %)
Income from operations 2,341,958 1,254,464 (46.4 %)
Financial Result (15,094 ) (79,304 ) 425.4 %
Share of loss of associates 86 1 98.8 %
Income before income taxes 2,326,950 1,175,161 (49.5 %)
Income taxes (518,887 ) (137,581 ) (73.5 %)
Net income 1,808,063 1,037,580 (42.6 %)
Currency translation effect 1,417,364 61,729 (95.6 %)
Cash flow hedges, net of income tax (60,108 ) 216,794 (460.7 %)
Remeasurements of employee benefit – net income tax (147 ) 1,102 (849.7 %)
Comprehensive income 3,165,172 1,317,205 (58.4 %)
Non-controlling interest (193,754 ) (12,895 ) 93.3 %
Comprehensive income attributable to controlling interest 2,971,419 1,304,310 (56.1 %)

The non-controlling interest corresponds to the 25.5% stake held in the Montego Bay airport by Vantage Airport Group Limited (“Vantage”).

Exhibit E: Consolidated stockholders’ equity (in thousands of pesos):

Common Stock Legal Reserve Reserve for Share Repurchase Repurchased Shares Retained Earnings Other comprehensive income Total controlling interest Non-controlling interest Total Stockholders’ Equity
Balance as of January 1, 2020 6,185,082 1,592,551 3,283,374 (1,733,374 ) 9,940,035 360,504 19,628,172 1,041,271 20,669,443
Comprehensive income:
Net income 1,776,946 1,776,946 31,117 1,808,063
Foreign currency translation reserve 1,254,726 1,254,726 162,637 1,417,364
Remeasurements of employee benefit – Net (147 ) (147 ) (147 )
Reserve for cash flow hedges – Net of income tax (60,108 ) (60,108 ) (60,108 )
Balance as of March 31, 2020 6,185,082 1,592,551 3,283,374 (1,733,374 ) 11,716,981 1,554,976 22,599,590 1,235,024 23,834,614
Balance as of January 1, 2020 6,185,082 1,592,551 3,283,374 (1,733,374 ) 11,908,890 556,287 21,792,811 1,059,972 22,852,783
Repurchase of share (338,184 ) (338,184 ) (338,184 )
Comprehensive income:
Net income 1,050,154 1,050,154 (12,575 ) 1,037,580
Foreign currency translation reserve 36,259 36,259 25,470 61,729
Remeasurements of employee benefit – Net 1,102 1,102 1,102
Reserve for cash flow hedges – Net of income tax 216,794 216,794 216,794
Balance as of March 31, 2021 6,185,082 1,592,551 3,283,374 (2,071,558 ) 12,959,044 810,442 22,758,934 1,072,867 23,831,802

For presentation purposes, the 25.5% stake in Desarrollo de Concesiones Aeroportuarias, S.L. (“DCA”) held by Vantage appears in the Stockholders’ Equity of the Company as a non-controlling interest.

As a part of the adoption of IFRS, the effects of inflation on common stock recognized pursuant to Mexican Financial Reporting Standards (MFRS) through December 31, 2007 were reclassified as retained earnings because accumulated inflation recognized under MFRS is not considered hyperinflationary according to IFRS. For Mexican legal and tax purposes, Grupo Aeroportuario del Pacifico, S.A.B. de C.V., as an individual entity, will continue preparing separate financial information under MFRS. Therefore, for any transaction between the Company and its shareholders related to stockholders’ equity, the Company must take into consideration the accounting balances prepared under MFRS as an individual entity and determine the tax impact under tax laws applicable in Mexico, which requires the use of MFRS. For purposes of reporting to stock exchanges, the consolidated financial statements will continue being prepared in accordance with IFRS, as issued by the IASB.

Exhibit F: Other operating data:

1Q20 1Q21 Change
Total passengers 11,725.2 7,406.9 (36.8 %)
Total cargo volume (in WLUs) 553.0 668.2 20.8 %
Total WLUs 12,278.2 8,075.1 (34.2 %)
Aeronautical & non aeronautical services per passenger (pesos) 353.6 365.7 3.4 %
Aeronautical services per WLU (pesos) 254.4 256.7 0.9 %
Non aeronautical services per passenger (pesos) 87.1 85.9 (1.5 %)
Cost of services per WLU (pesos) 60.0 80.8 34.7 %

WLU = Workload units represent passenger traffic plus cargo units (1 cargo unit = 100 kilograms of cargo).


[1] Revenues from improvements to concession assets are recognized in accordance with International Financial Reporting Interpretation Committee 12 “Service Concession Arrangements” (IFRIC 12), but this recognition does not have a cash impact or an impact on the Company’s operating results. Amounts included as a result of the recognition of IFRIC 12 are related to construction of infrastructure in each quarter to which the Company has committed in accordance with the Company’s Master Development Programs in Mexico and Capital Development Program in Jamaica. All margins and ratios calculated using “Total Revenues” include revenues from improvements to concession assets (IFRIC 12), and, consequently, such margins and ratios may not be comparable to other ratios and margins, such as EBITDA margin, operating margin or other similar ratios that are calculated based on those results of the Company that do have a cash impact.

IR Contacts:
Saul Villarreal, Chief Financial Officer svillarreal@aeropuertosgap.com.mx
Alejandra Soto, IR and Financial Planning Manager asoto@aeropuertosgap.com.mx
Gisela Murillo, Investor Relations gmurillo@aeropuertosgap.com.mx / +523338801100 ext. 20294
Maria Barona, i-advize Corporate Communications mbarona@i-advize.com

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