Operator: Greetings. Welcome to OMA's Second Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A Q&A session will follow the formal presentation. Please note this conference is being recorded. I will now turn the conference over to Emmanuel Camacho, Thank you. You may begin.
Luis Emmanuel Camacho Thierry: Thank you, Leo, and hello, everyone. Thank you for standing by, and welcome to OMA's Second Quarter 2026 Earnings Conference Call. Thank you for joining us today as we discuss our company's performance and financial results for the past quarter. Joining us today are CEO, Ricardo Duenas; CFO, Ruffo Perez Pliego del Castillo. Please be reminded that certain statements made during the course of our discussion today may constitute forward-looking statements, which are based on current management expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially, including factors that may be beyond our control. And now I will turn the call over to Ricardo Duenas for his opening remarks.
Ricardo Duenas Espriu: Thank you, Emmanuel. Good morning, everyone, and thank you for joining us today. This morning, Ruffo and I will review our quarterly operational and financial results and then we will be pleased to answer your questions. During the second quarter of 2026, OMA served 7.2 million passengers, an increase of 0.4% versus the second quarter of last year while available seat capacity decreased by 0.3%. Domestic passenger traffic grew by 0.6% as compared to the second quarter of 2025. Our San Luis Potosí Airport was the main contributor to domestic passenger traffic growth with increases on the routes to AIFA and Cancún Airports. These routes collectively added over 23,000 passengers during the quarter, representing 61% of the total domestic passenger growth. International passenger traffic decreased by 1.2% mainly driven by our Monterrey Airport with lower traffic on the Los Angeles, Dallas, Fort Worth, and San Antonio routes. In terms of growth by airline, Volaris, which accounted for 25% of our total passenger traffic in the quarter, recorded a 7% growth versus the second quarter of 2025 while Viva, which accounted for 50% of total passenger traffic, recorded a 2% decline. During the quarter, airlines opened 24 new routes across our airports, including 18 domestic and 6 international routes. This included the launch of Aeroméxico's new route to Paris in April as well as Iberia's new route to Madrid in June, marking the airline's first-ever operation in Monterrey. The Paris route generated more than 14,000 passengers during the quarter. Following its strong initial performance, the route was converted from a seasonal to a permanent year-round operation, further increasing Monterrey's connectivity with Europe. Turning to our financial performance. Aeronautical revenues increased 4% during the quarter mainly reflecting the tariff adjustment that became effective in mid-April. Commercial revenues continued to perform well during the quarter increasing 7% versus the second quarter of 2025. Commercial revenue per passenger reached Ps. 66.4, an increase of 6.3% while occupancy of commercial space remained at 96% at the end of the quarter. Diversification revenues increased by 17% year-over-year mainly driven by OMA Carga business where revenues increased 29%, reflecting new client operations and additional high-value cargo handling in Monterrey as well as higher activity at our Chihuahua warehouse. Hotel services revenues grew by 6% supported by higher occupancy at the NH Hotel terminal 2 hotel and higher average daily rates at both hotels. Industrial services revenues reached Ps. 57 million, an increase of 9% mainly attributable to a greater number of square meters leased. OMA second quarter adjusted EBITDA increased 6.6% to Ps. 2.7 billion while the adjusted EBITDA margin expanded to 75.2% reflecting revenue growth and disciplined cost management, despite continued inflationary and labor cost pressures. Total investments in the quarter, including MDP investments, major maintenance, and strategic investments, were Ps. 949 million. Before concluding, I would like to highlight two relevant events during the quarter. First, OMA achieved the sustainability performance target linked to our sustainability-linked bonds. Reaching an 88% reduction in Scope 1 and Scope 2 greenhouse gas emissions per passenger by the end of 2025 well above the 58% reduction target set against our 2018 baseline. The outcome reflects the company's ongoing investments in energy efficiency and decarbonization initiatives. Finally, on July 16, we issued Ps. 3 billion in long-term notes in the Mexican market. Proceeds were used to repay Ps. 1.7 billion of outstanding short-term bank debt as well as to repay the Ps. 640 million corresponding to our OMA 23 notes maturing on July 24. The remaining proceeds will fund committed investments under the Master Development Program and general corporate purposes including working capital requirements. I would now like to turn the call over to Ruffo Perez Pliego del Castillo, who will discuss the financial highlights for the quarter.
Ruffo Perez Pliego del Castillo: Thank you, Ricardo, and good morning, everyone. I will briefly go over our financial results for the quarter before opening the call for questions. Aeronautical revenues increased 3.9% relative to the second quarter of 2025 mainly reflecting the tariff adjustments that took effect in April 2026. Domestic passenger charges grew in line with these new tariffs, while international passenger charges declined mainly due to the appreciation of the peso and lower international traffic. Other aeronautical services grew at a more modern pace and tariff increase, reflecting fewer aircraft operations during the quarter. Together, these effects resulted in a 3.5% increase in aeronautical revenue per passenger. Non-aeronautical revenues increased 9.8%. Commercial revenues increased 6.7%, mainly driven by higher parking, restaurants, VIP lounges and retail revenues. Parking revenues increased 8.8% driven by higher passenger traffic as well as higher tariffs from longer stays across our airports. Restaurants and retail revenues were up 11.3% and 4.2%, respectively, both mainly as a result of higher penetration rates and opening of new outlets. VIP lounges increased by 15.8% driven by higher capture rates in the Monterrey Airport as well as the recent start of operations of the VIP lounge in Torreón. Diversification activities grew by 17.4% in the quarter, mainly due to the increase in OMA Carga revenues. Total aeronautical and non-aeronautical revenues grew 5.4% to Ps. 3.6 billion in the quarter. Construction revenues amounted to Ps. 844 million in Q2 2026. The cost of airport services and G&A expense increased 3.6% versus 2Q 2025 supporting the expansion of adjusted EBITDA margin. The increase mainly reflected higher payroll, contracted services and materials and supply expenses. Payroll increased 9.5%, mainly reflecting inflationary adjustments and addition of new positions. Contracting services increased 10.7% primarily due to higher security and cleaning expenses, resulting from contract renewals and minimum wage increases, and materials and supplies increased 18.7%, mainly reflecting the higher operation requirements in our OMA Carga and our VIP lounge operations. Concession tax increased 3.9% to Ps. 294 million. Major maintenance provision was Ps. 99 million compared to Ps. 50 million in 2Q 2025, reflecting new MDP provision requirements. As a result, adjusted EBITDA increased 6.2% to Ps. 2.7 billion, and the margin reached 75.2%. Our financing expense decreased by 17.4% to Ps. 337 million in the quarter mainly as a result of a lower effect from the change in present value of our major maintenance provision which was partially offset by higher interest expense on debt. Consolidated net income was Ps. 1.5 billion in the quarter, an increase of 10.2% versus 2Q 2025. Turning to our cash position. Cash generated from operating activities in the second quarter amounted to Ps. 1.8 billion, while investing and financing activities used Ps. 776 million and Ps. 2.1 billion, respectively. As a result, our cash position at the end of the quarter was Ps. 2.6 billion. At the end of June, total debt amounted to Ps. 14.3 billion and leverage measured as net debt to adjusted EBITDA ratio stood at 1.1x. This concludes our prepared remarks.
Ricardo Duenas Espriu: Theo, please open the call to questions.
Operator: Thank you. We will now be conducting a Q&A session. You may press two if you would like to remove your question from the queue. Pick up your handset before pressing the star key. Moment while we pull for questions. Our first question is from Jens Spiess with Morgan Stanley Investment Management. Please proceed with your question.
Jens Spiess: Hi. Congrats on the results. So I have a question on the maximum tariff compliance. What is your expectation throughout the year? And, also, if you can give a bit more details on your CapEx. We saw that you have spent so far, like, Ps. 1.4 billion in your Mexican airports through the first half of the year while your MDP investments are Ps. 1.2 billion. So what is going on there? Are you, like, anticipating some of the investments that are in the, MDP plan, like, for 2027?
Ricardo Duenas Espriu: Sure. For the first part, Jens, we are planning to end the year We just recently adjusted tariffs mid-April. So considering that, we believe by the end of the year we are going to be around the 93% compliance with maximum tariffs. And as for the second part, maybe, Ruffo, you want to join?
Ruffo Perez Pliego del Castillo: Sure. Remember, that, we had some, carryover investments that were, from the previous MDP that were going to be completing 2026 and 2027. So that has to be added to the actual 2026 commitment. So for this year, we are expecting around Ps. 3.5 billion to Ps. 4 billion total investment for the year.
Jens Spiess: Okay. Perfect. Perfect. Yeah. And just one additional question on like, it seems like flight schedules are pointing to some, like, seat growth moderation in the fourth quarter. But very strong growth in the in the first quarter of next year. Are you seeing the same?
Ricardo Duenas Espriu: Not yet. The schedules, or the I would say, more definitive schedules, for the winter season have yet to be, published. So right now, we have an indication and, yeah, we see some conservativeness from airlines in April. So I do not necessarily think that the first quarter yet do reflect, the expectations of airlines, and they are just very indicative at this time. Got it. Alright. Thank you.
Operator: Thank you. Our next question is from Rodolfo Ramos with Bradesco BBI. Please proceed with your question.
Rodolfo Ramos: Thank you for taking my question. I have two. The first one is follow-up on Jeff's I do not know if you can talk a little bit about, you know, your outlook on traffic growth. I know there is a lot of challenges on the horizon here, but wanted to get your the sense and visibility and, specifically, if you can comment on the potential for developing Monterrey's route network. It was it is encouraging to see more regular services you know, to New York, for example. I do not know if there is any other low-hanging fruit on the domestic market. So that is my first question on the on the traffic side. And then on the second, if I may, you know, it was very interesting to see OMA Carga with very strong, top-line growth. You know, just one of your peers has also seen a very active activity on the cargo side. So wanted to get a little bit of the sense that you get from the industries that you are seeing participating in your in your volumes. Do not if there is any other potential for you to go into bonded warehouses or try to capture more value out of the, you know, the this booming exports that Mexico's having. Thank you.
Ricardo Duenas Espriu: Sure. Thank you, Rodolfo, for your question. So regarding traffic growth, yes, of course, as a result of the of the oil spike, jet fuel spike, that we have seen in the first half of the year, we are seeing airlines adjusting some of its capacity, for the rest of the year. Whereas still, we are anticipating, to be in positive numbers. We think traffic is gonna be around flat to low, single digits. I think that reflects on the resilience of some of the OMA's airport, network. There are some, Monterrey routes already announced that are in the pipeline, specifically with WestJet, Acapulco, Montreal, Chihuahua, Mexico, Culiacán, Vancouver, Monterrey, Vancouver. So we are currently working with airlines to try to expand and take advantage of Monterrey's strategic location. In terms of cargo, yes, we are seeing very good numbers coming from there. We are currently expanding, our warehouse. We are planning to finish that expansion in the next coming months. Some of the growth you have seen has been driven by new client operations? as well as the handling of additional high-value cargo operations. Chihuahua you there was an interesting spike due to the implementation of handling service for UPS and FedEx. So we are investing in OMA Carga and systems and processes. So we expect good growth coming in the next coming months. We continue seeing that work type of growth. Thank you.
Operator: Thank you. Our next question comes from Alberto Valerio with UBS. Please proceed with your question.
Alberto Valerio: Hi, team. Thank you for taking my questions. My first question is related to the working capital of the company. We saw nice mid-double-digit growth on net income. But when you go for the cash generation from operation, it is a little bit softer than that. If you can explain the differences in receivables and payables, is it recurring for the remainder of the year, or if it was possible for this quarter.
Ruffo Perez Pliego del Castillo: Sure. Hi, Alberto. So, yes, we have seen increase utilization of working capital. We are accelerating our CapEx execution versus what we had, last year. So there are some advanced payments of its of new contracted works that are reflected as advances in the working capital. And as construction progresses, those advances will be amortized, but they are a signal of our increased CapEx execution. And the other one is, our, tax payments have been higher. We have a higher factor for calculation of provisional taxes. Versus what we had in the first half of last year. So even though provisional taxes are based on revenue and revenues are, growing, in the low single digits, our factor reflects that higher level of provisional payments, which in the annual tax filing of next year, there will be less of an impact, but during the year, we will see that type of increase in taxes paid.
Alberto Valerio: Fantastic. So we should see this normalized construction at least until the MDP CapEx being on execution. And the tax is something more on a regular basis. Is that correct?
Ruffo Perez Pliego del Castillo: Yes. And starting next year, a new factor will be recalculated. So that will tend to normalize, levels versus this year.
Alberto Valerio: Fantastic. And one more if I may. I might miss because cutting the first question of our colleague. When should we expect OMA to reach the maximum tariff again?
Ricardo Duenas Espriu: Should we draw a linear line to there? So this year, we are expecting around 93% to 95% compliance with the maximum tariff for the full year. And next year, we should see what the expected growth in traffic is as well as the adjustments to the, inflation, as you know, maximum tariff has adjusted every year with inflation. So we will have to see how those, vectors behave and then see how can we get to our 99% target. But as we said, we would probably target between two to three years after implementation of the MDP to get to that level. So probably we will be reaching the maximum tariff by the end of 2027, mid-2028.
Alberto Valerio: Yes. That is very helpful. Yep.
Ricardo Duenas Espriu: Fantastic. Thanks so much.
Operator: Thank you. Our next question is from Ernst Mortenkötter. with GBM. Please proceed with your question.
Abhishek: Hi, guys. Thank you for taking my question. This is Abhishek with a follow-up on the tariff maximum tariff question. Do you think that I mean, if oil pressures remain, should we think that the compliance and the maximum tariff could take longer, or are you indifferent, to those to those pressures? And also on the commercial side, excluding diversification activities, we saw a slight increase in the non-aeronautical revenue per passenger slightly above inflation. What kind of growth should we expect on those business lines going forward? Thank you.
Ruffo Perez Pliego del Castillo: So on the second part of your question, yes, on the commercial side, I think that we will remain stable relative to current levels of around Ps. 66per pax. We expect to open the new areas in the Monterrey Airport towards and be fully operational by the end of, next year. So we will see a pickup in commercial revenue per passenger until 2028. But for the following months, I think the Ps. 66 level is reasonable to assume.
Ricardo Duenas Espriu: And regarding, the maximum tariff, that is that what you mentioned of increased oil prices and its impact, yes, that could be a headwind towards, fully passing through our, maximum tariff. But, we will see where we are at the beginning of the year, and situation has become more stable and more visible. And so we can start taking decisions of how to, pass through the rest of the increase.
Abhishek: Very useful. Thank you.
Operator: Thank you. Our next question is from Gabriel Himelfarb with Scotiabank. Please proceed with your question.
Gabriel Himelfarb Mustri: Hi. Good morning, and thanks for the call. My question is regarding on what is next for OMA beyond the MDP and how to, be to support the long-term growth strategy for OMA. Thank you.
Ricardo Duenas Espriu: I am sorry, Gabriel. We could not we could not catch it. Can you repeat it? The line is not working very well.
Gabriel Himelfarb Mustri: Sure. Can you hear me now? Yes. So my question is regarding, yeah. Can you hear me? Sorry. Yes. Sorry. Well, my question is regarding what is the next value driver for OMA beyond the MDP? And how could VINCI support, or what will be the contribution of VINCI for OMA's growth in the next years?
Ricardo Duenas Espriu: Sure. Thank you, Gabriel, for your question. Regarding the second part, we have seen many advantages. Just to mention a few, just access to human capital has been a great advantage. Access to a larger network of airports has allowed us to try to bring best practices around the world. We have seen them concretely in the last quarter, in the last six months, with all the technology projects that we have implemented in our network and specifically, in Monterrey, our bargaining power with suppliers and with airlines has also been a great advantage. Their know-how and their expertise in the construction side of the business has also been very valuable. Their knowledge in terms of commercial planning has also been very effective. And you have seen those in the numbers. As for drivers coming forward, we are also working in new projects. We are currently working in two new hotels. one, an additional one in Monterrey, and a new one in Ciudad Juárez. We are expanding our cargo operations as well. We are currently evaluating industrial park expansion as well, and we will continue optimizing our efficiency and trying to improve, the commercial revenues per passenger. As you know, by the end of next year, we will have the new terminal in Monterrey that should add new commercial revenue to our airports. Okay. Thank you very much.
Operator: Thank you. This concludes our Q&A session. I would like to turn the floor back over to Ricardo for closing comments.
Ricardo Duenas Espriu: We would like to thank everyone for participating in today's call. We appreciate your insightful questions, engagement, and continued support. Ruffo, Emmanuel, and I are available to answer your questions. Thank you once again, and have a great day.
Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines and have a wonderful day.
