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OFFON

GRUPO AEROPORTUARIO DEL PACÍFICO, S.A.B. DE C.V.

(GAP B)
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Grupo Aeroportuario del Pacífico B de C : Pacifico Announces Results for the Second Quarter of 2021 (Form 6-K)

07/29/2021 | 09:39am EDT

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

GUADALAJARA, Mexico, July 29, 2021 (GLOBE NEWSWIRE) -- Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (NYSE: PAC; BMV: GAP) ('the Company' or 'GAP') reported its consolidated results for the second quarter ended June 30, 2021 (2Q21) (at the end of this report, tables are presented of passenger traffic and consolidated results for 2021 compared to 2019, in order to illustrate the recovery of our financial results and their trend). 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 half of the year (1H21), passenger traffic increased 37.8% compared to 1H20 and decreased 23.4% as compared to 1H19, demonstrating a better-than-expected recovery, despite continuing restrictions on international travel. The United States Government expanded the requirement for negative COVID-19 testing for all air passengers entering the United States beginning January 26, 2021. Additionally, as of January 7, 2021, there were similar testing requirements for air passengers traveling to Canada, and subsequently, the Canadian Government suspended flights with Mexico and the Caribbean until July 5, 2021, directly affecting the recovery of passenger traffic levels at our Puerto Vallarta, Montego Bay and Kingston airports.

Company measures during 2Q21:

  • The Company continued supporting airlines and commercial clients. For commercial contracts, the Company granted discounts on guaranteed minimum rent amounts in accordance with the percentage decrease in passenger traffic at each airport as compared to 2Q19, while maintaining our percentage of participation in revenues. With regards our support 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.
  • The control measures for our cost of services were maintained throughout some expense line items and primarily at our airports that have experienced a slower recovery. However, as a result of the increase in passenger traffic during 2Q21, we have freed certain restrictions particularly on personnel, maintenance, security, and cleaning services, among others.

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

During 2Q21, results were significantly better as compared to 2Q20, with an increase in revenues in 2Q21 of 345.4% and an increase in cost of services of 8.5%, the Company generated positive EBITDA of Ps. 2,797.1 million.

In 2Q21, operating activities continued generating positive cash flow. The Company reported a financial position of cash and cash equivalents as of June 30, 2021, of Ps. 15,503.0 million (1.6% lower than the 2Q20 balance). During 2Q21, the Company issued long-term bond certificates (Certificados Bursátiles) for Ps. 4,500.0 million. The proceeds were used to pay off the Ps. 1,000.0 million debt contracted for working capital in 2Q20 with Scotiabank, the Ps. 1,500.0 million maturity payment for the 'GAP16' certificate (which was paid on July 2, 2021), and the remainder will be used for committed investments at our Mexican airports. Additionally, cash flow from operating activities was used to pay off the Ps. 1,000.0 million debt contracted for working capital in May 2020 with BBVA. Additionally, a payment of Ps. 3.8230950615 per share outstanding was made as a capital reduction and Ps. 872.9 million in share repurchases were made during 2Q21.

In 2Q21, the Company performed an assessment of the portfolio risk of our airlines and commercial clients in terms of liquidity. As a result, during this quarter it was not necessary to recognize the reserve provision for expected credit losses due to growth and recovery of our main airlines and commercial clients.

During 2Q21, 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 continue decreasing 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. 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 ensuring business continuity.

Summary of Results 2Q21 vs. 2Q20 (and 2Q19 for purposes of illustrating the recovery trend):

  • The sum of aeronautical and non-aeronautical services revenues increased by Ps. 3,051.2 million, or 345.4% (Ps. 399.7 million, or 11.3%, as compared to 2Q19). Total revenues increased by Ps. 3,410.7 million, or 229.7% (Ps. 1,238.3 million, or 33.9%, as compared to 2Q19).

  • Cost of services increased by Ps. 52.1 million, or 8.1% (as compared to 2Q19, cost of services decreased Ps. 9.7 million, or 1.4%).

  • Income from operations increased by Ps. 2,655.4 million, or 720.3% (Ps. 287.7 million, or 14.4%, as compared to 2Q19).

  • EBITDA increased by Ps. 2,660.6 million, or 1,948.8% (Ps. 372.2 million, or 15.3%, as compared to 2Q19), going from Ps. 136.5 million in 2Q20 to Ps. 2,797.1 million in 2Q21. EBITDA margin (excluding the effects of IFRIC 12) increased from 15.6% in 2Q20 to 71.2% in 2Q21 (EBITDA margin (excluding the effects of IFRIC 12) was 68.8% in 2Q19).

  • Net comprehensive income increased Ps. 2,247.0 million, or 237.5% (Ps. 228.7 million, or 18.8%, as compared to 2Q19), from a loss of Ps. 946.0 million in 2Q20 to an income of Ps. 1,300.9 million in 2Q21.

Passenger Traffic

During 2Q21, total passengers at the Company's 14 airports increased by 9,373.9 thousand passengers, an increase of 562.6%, compared to 2Q20 (as compared to 2Q19, total passengers decreased by 1,169.3 thousand, or 9.6%).

During 2Q21, the following new routes were opened:

National:

Airline Departure Arrival Opening date Frequencies
Aeromar La Paz Mazatlán June 17, 2021 2 weekly frequencies
Volaris Méxicali Cancún June 18, 2021 2 weekly frequencies

Note: Frequencies can vary without prior notice.

International:

Airline Departure Arrival Opening date Frequencies
United Guanajuato Chicago O'Hare June 3, 2021 7 weekly frequencies
American Airlines Hermosillo Dallas Fort Worth June 3, 2021 7 weekly frequencies
JetBlue Los Cabos Los Ángeles June 17, 2021 6 weekly frequencies
JetBlue Los Cabos Nueva York (JFK) June 17, 2021 5 weekly frequencies

Note: Frequencies can vary without prior notice.

Domestic Terminal Passengers - 14 airports (in thousands):
Airport 2Q20 2Q21 Change 6M20 6M21 Change
Guadalajara 393.8 2,177.8 453.0% 2,730.3 3,751.4 37.4%
Tijuana * 460.3 1,773.3 285.3% 1,880.3 3,184.1 69.3%
Los Cabos 76.1 520.5 584.0% 478.8 887.4 85.3%
Puerto Vallarta 34.0 453.1 1233.5% 401.8 753.5 87.6%
Guanajuato 55.9 394.9 606.6% 480.5 680.9 41.7%
Montego Bay 0.0 0.0 0.0% 1.0 0.0 (100.0%)
Hermosillo 58.5 360.8 517.2% 454.6 618.4 36.0%
Mexicali 46.9 273.0 481.5% 323.9 463.2 43.0%
Morelia 46.1 145.8 216.2% 171.9 255.7 48.7%
La Paz 33.5 228.5 582.2% 247.0 397.7 61.0%
Aguascalientes 20.0 144.6 622.4% 157.6 242.4 53.8%
Kingston 0.0 0.7 3204.8% 1.3 0.7 (46.6%)
Los Mochis 10.6 91.7 763.9% 97.4 162.6 66.9%
Manzanillo 1.9 23.1 1105.9% 25.1 40.3 60.4%
Total 1,237.6 6,587.9 432.3% 7,451.5 11,438.1 53.5%
*CBX users are classified as international passengers.
International Terminal Passengers - 14 airports (in thousands):
Airport 2Q20 2Q21 Change 6M20 6M21 Change
Guadalajara 159.9 949.3 493.7% 1,117.7 1,544.3 38.2%
Tijuana * 140.7 737.8 424.4% 825.0 1,162.6 40.9%
Los Cabos 28.2 983.4 3392.3% 975.2 1,517.8 55.6%
Puerto Vallarta 25.0 575.8 2201.1% 1,111.3 928.2 (16.5%)
Guanajuato 16.9 163.4 867.5% 165.1 248.8 50.7%
Montego Bay 16.7 656.8 3832.9% 1,149.6 961.5 (16.4%)
Hermosillo 1.9 25.9 1286.7% 20.6 45.8 121.8%
Mexicali 0.1 1.1 1108.6% 1.3 1.8 39.9%
Morelia 9.3 101.8 996.6% 108.9 176.9 62.4%
La Paz 0.4 4.3 871.7% 3.8 8.3 119.9%
Aguascalientes 6.9 54.6 696.6% 55.3 88.6 60.2%
Kingston 21.6 183.4 749.1% 375.1 298.8 (20.3%)
Los Mochis 0.1 2.4 3542.4% 1.3 4.0 198.6%
Manzanillo 1.1 12.1 1031.6% 29.5 21.5 (27.3%)
Total 428.6 4,452.2 938.7% 5,939.9 7,008.7 18.0%
*CBX users are classified as international passengers.
Total Terminal Passengers - 14 airports (in thousands):
Airport 2Q20 2Q21 Change 6M20 6M21 Change
Guadalajara 553.7 3,127.2 464.8% 3,848.1 5,295.7 37.6%
Tijuana * 600.9 2,511.1 317.9% 2,705.3 4,346.6 60.7%
Los Cabos 104.3 1,503.9 1342.5% 1,454.0 2,405.1 65.4%
Puerto Vallarta 59.0 1,028.9 1643.8% 1,513.1 1,681.8 11.1%
Guanajuato 72.8 558.3 667.2% 645.6 929.7 44.0%
Montego Bay 16.7 656.8 3832.9% 1,150.6 961.5 (16.4%)
Hermosillo 60.3 386.8 541.1% 475.2 664.2 39.8%
Mexicali 47.0 274.1 482.8% 325.2 465.0 43.0%
Morelia 55.4 247.6 347.0% 280.8 432.5 54.0%
La Paz 33.9 232.9 586.0% 250.8 406.0 61.9%
Aguascalientes 26.9 199.3 641.3% 212.9 330.9 55.4%
Kingston 21.6 184.1 751.5% 376.4 299.5 (20.4%)
Los Mochis 10.7 94.1 781.0% 98.7 166.6 68.7%
Manzanillo 3.0 35.2 1079.4% 54.6 61.7 13.0%
Total 1,666.2 11,040.1 562.6% 13,391.4 18,446.9 37.8%
*CBX users are classified as international passengers.
CBX (thousands) Table 5
Airport 2Q20 2Q21 Change 6M20 6M21 Change
Tijuana 140.4 731.6 421.1% 817.7 1,152.6 41.0%

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

2Q20 2Q21 Change
Revenues
Aeronautical services 551,875 3,023,604 447.9%
Non-aeronautical services 331,641 911,151 174.7%
Improvements to concession assets (IFRIC 12) 601,542 960,983 59.8%
Total revenues 1,485,058 4,895,738 229.7%
Operating costs
Costs of services: 643,554 695,644 8.1%
Employee costs 239,260 289,828 21.1%
Maintenance 97,402 109,037 11.9%
Safety, security & insurance 104,079 124,605 19.7%
Utilities 79,692 95,591 20.0%
Other operating expenses 123,121 76,583 (37.8%)
Technical assistance fees 8,777 135,441 1443.1%
Concession taxes 94,721 303,817 220.7%
Depreciation and amortization 505,174 510,380 1.0%
Cost of improvements to concession assets (IFRIC 12) 601,542 960,983 59.8%
Other (income) expense (58) 2,712 4775.9%
Total operating costs 1,853,710 2,608,977 40.7%
(Loss) income from operations (368,651) 2,286,761 720.3%
Financial Result (311,089) (406,199) 30.6%
Share of loss of associates (83) - 100.0%
(Loss) income before income taxes (679,823) 1,880,562 376.6%
Income taxes 97,616 (456,589) (567.7%)
Net (loss) income (582,207) 1,423,973 344.6%
Currency translation effect (66,233) (146,953) 121.9%
Cash flow hedges, net of income tax (287,997) 23,233 108.1%
Remeasurements of employee benefit - net income tax (9,558) 735 107.7%
Comprehensive (loss) income (945,995) 1,300,988 237.5%
Non-controlling interest 29,645 13,545 (54.3%)
Comprehensive (loss) income attributable to controlling interest (916,350) 1,314,533 243.5%
2Q20 2Q21 Change
EBITDA 136,523 2,797,141 1948.8%
Comprehensive (loss) income (945,994.96 1,300,988 237.5%
Comprehensive (loss) income per share (pesos) (1.69 2.5018 248.4%
Comprehensive (loss) income per ADS (US dollars) (0.73 1.2568 272.0%
Operating (loss) income margin (24.8%) 46.7% 288.2%
Operating (loss) income margin (excluding IFRIC 12) (41.7%) 58.1% 239.3%
EBITDA margin 9.2% 57.1% 521.5%
EBITDA margin (excluding IFRIC 12) 15.6% 71.2% 357.6%
Costs of services and improvements / total revenues 83.8% 33.8% (59.6%)
Cost of services / total revenues (excluding IFRIC 12) 72.8% 17.7% (75.7%)

- Net (loss) income and comprehensive (loss) income per share for 2Q21 were calculated based on 520,024,505 shares outstanding as of June 30, 2021, and for 2Q20 were calculated based on 525,525,547 shares outstanding as of June 30, 2020. U.S. dollar figures presented were converted from pesos to U.S. dollars at a rate of Ps. 19.9060 per U.S. dollar (the noon buying rate on June 30, 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. 20.0503 per U.S. dollar for the three months ended June 30, 2021, was used.

Revenues (2Q21 vs. 2Q20)

  • Aeronautical services revenues increased by Ps. 2,471.7 million, or 447.9%.
  • Non-aeronautical services revenues increased by Ps. 579.5 million, or 174.7%.
  • Revenues from improvements to concession assets increased by Ps. 359.4 million, or 59.8%.
  • Total revenues increased by Ps. 3,410.7 million, or 229.7%.
  • The change in aeronautical services revenues was composed primarily of the following factors:

    1. Revenues at the Company's Mexican airports increased by Ps. 2,201.1 million or 481.6% compared to 2Q20, mainly as a result of the 526.5% increase in passenger traffic. As international passenger traffic accelerates and business passenger traffic recovers, the Company expects to be closer to recovering pre-pandemic revenue levels.

    2. Revenues from the Montego Bay airport increased by Ps. 197.5 million, or 393.3%, compared to 2Q20. This was mainly due to the 3,832.9% increase in passenger traffic. The passenger traffic increase was partially offset by the 14.2% appreciation of the peso versus the U.S. dollar during 2Q21, which went from an average exchange rate of Ps. 23.3631 in 2Q20 to Ps. 20.0503 in 2Q21.

    3. Revenues from the Kingston airport increased by Ps. 73.0 million, or 163.5% compared to 2Q20, mainly due to a 751.5% increase in passenger traffic. The appreciation of the peso versus the dollar partially offset the increase in passenger traffic.

  • The change in non-aeronautical services revenues was composed primarily of the following factors:

    1. Revenues from the Company's Mexican airports increased by Ps. 511.2 million, or 204.5%, compared to 2Q20. Revenues from businesses operated by third parties increased by Ps. 368.3 million. This was mainly due to an increase in revenues from food and beverage, duty-free stores, car rentals, retail, and time shares, which jointly increased by Ps. 318.1 million, or 239.6%. Revenues from businesses operated directly by the Company increased by Ps. 128.1 million, or 176.6%, while the recovery of costs increased by Ps. 14.7 million, or 62.0%.

    2. Revenues from the Montego Bay airport increased by Ps. 57.8 million, or 99.6%, compared to 2Q20. Revenues in U.S. dollars increased by US$ 3.3 million, or 132.6%. However, the 14.2% appreciation of the peso versus the dollar partially offset the revenue increase in 2Q21.

    3. Revenues from the Kingston airport declined by Ps. 10.6 million, or 44.7%, compared to 2Q20. Revenues in U.S. dollars decreased by US$ 0.7 million, or 68.7%.
2Q20 2Q21 Change
Businesses operated by third parties:
Duty-free 25,647 141,096 450.1%
Food and beverage 32,575 122,340 275.6%
Retail 36,812 100,186 172.2%
Car rentals 46,340 94,946 104.9%
Leasing of space 49,487 61,215 23.7%
Time shares 1,085 49,656 4475.7%
Ground transportation 12,414 34,431 177.4%
Communications and financial services 5,820 22,524 287.0%
Other commercial revenues 13,548 31,427 132.0%
Total 223,727 657,820 194.0%
Businesses operated directly by us:
Car parking 23,130 97,921 323.4%
VIP lounges 19,401 52,638 171.3%
Advertising 23,739 11,414 (51.9%)
Convenience stores 8,542 43,852 413.4%
Total 74,811 205,826 175.1%
Recovery of costs 33,103 47,503 43.5%
Total Non-aeronautical Revenues 331,641 911,151 174.7%

Figures expressed in thousands of Mexican pesos.

  • Revenues from improvements to concession assets1
    Revenues from improvements to concession assets (IFRIC-12) increased by Ps. 359.4 million, or 59.8%, compared to 2Q20, mainly in:

    1. The Company's Mexican airports, which increased by Ps. 401.3 million, or 74.6%, as a result of the increase in committed investments in the Master Development Program for the 2020-2024 period.

    2. Improvements to concession assets at the Montego Bay airport decreased Ps. 41.8 million, or 66.0%. During 2Q21, no investments in improvements to concession assets were made at the Kingston airport.

________________________
[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.

Total operating costsincreased by Ps. 755.3 million, or 40.7%, compared to 2Q20, mainly due to a Ps. 359.4 million, or 59.8%, increase in the cost of improvements to the concession assets (IFRIC-12), a Ps. 335.8 million, or 324.4%, increase in concession taxes and technical assistance fees, and a Ps. 52.1 million, or 8.1% increase in cost of services (excluding the cost of improvements to concession assets, operating costs increased Ps. 395.8 million, or 31.6%). Total operating costs increase was composed primarily of the following factors:

Mexican Airports:

  • Operating costs increased by Ps. 726.2 million, or 50.2%, compared to 2Q20, primarily due to a Ps. 401.3 million, or 74.6%, increase in the cost of improvements to the concession assets (IFRIC-12) (excluding this cost, operating costs increased by Ps. 324.9 million or 35.8%), a Ps. 261.6 million, or 593.6%, increase in technical assistance fees and concession taxes, a Ps. 45.2 million, or 9.1%, increase in cost of services and a Ps. 20.3 million, or 5.6%, increase in depreciation and amortization.

The change in the cost of services during 2Q21 was mainly due to:

  • Employee costs increased Ps. 53.2 million, or 28.5%, compared to 2Q20, mainly due to the recognition of labor provisions in accordance with the reform to the Labor Law in Mexico and the hiring of additional personnel as required for airport operations.
  • Safety, security, and insurance costs increased Ps. 21.9 million, or 32.8%, compared to 2Q20, mainly due to an increase in the number of security staff as compared to 2Q20 when the partial closure of some operating areas reduced the need for personnel.
  • Maintenance costs increased by Ps. 12.7 million, or 16.7%, compared to 2Q20.
  • Other operating expenses decreased by Ps. 49.5 million or 44.0%, compared to 2Q20, mainly due to a Ps. 67.5 million decrease in the allowance for credit losses and the cost of sanitation supplies, purchase of supplies and donations to the medical sector for the prevention of COVID-19. This decrease was partially offset by a Ps. 18.0 million increase in the cost of sales in VIP lounges and convenience stores, FBO services and travel expenses.

Montego Bay Airport:

  • Operating costs decreased by Ps. 25.7 million, or 8.3%, compared to 2Q20, mainly due to a Ps. 41.8 million, or 66.0%, decrease in cost of improvements to the concession assets (IFRIC-12), a Ps. 15.1 million, or 11.0%, decrease in depreciation and amortization and the 14.2% appreciation of the Mexican peso against the U.S. dollar. However, this decrease was partially offset by an increase in concession taxes of Ps. 25.5 million, or 161.1%. Operating costs in U.S. dollars declined by US$ 0.3 million.

Kingston Airport:

  • Operating costs increased by Ps. 54.8 million, or 55.2%, compared to 2Q20, mainly due to a Ps. 48.7 million, or 111.6% increase in concession taxes, and a Ps. 6.2 million, or 11.7% increase in the cost of services. Operating costs in U.S. dollars increased by US$ 3.1 million.

Operating margin for 2Q21 went from a negative margin of 24.8% in 2Q20 to a positive margin of 46.7% in 2Q21. Excluding the effects of IFRIC-12, operating margin went from a negative margin of 41.7% to a positive margin of 58.1% in 2Q21. Operating income increased Ps. 2,655.4 million, or 720.3%, compared to 2Q20.

EBITDA margin went from 9.2% in 2Q20 to 57.1% in 2Q21. Excluding the effects of IFRIC-12, EBITDA margin went from 15.6% in 2Q20 to 71.2% in 2Q21. The nominal value of EBITDA was Ps. 2,797.1 million in 2Q21, compared to Ps. 136.5 million in 2Q20.

Financial cost increased by Ps. 95.1 million, from a net expense of Ps. 311.1 million in 2Q20 to a net expense of Ps. 406.2 million in 2Q21. This increase was mainly the result of:

  • Foreign exchange rate fluctuations, which went from an expense of Ps. 49.3 million in 2Q20 to an expense of Ps. 102.1 million in 2Q21. This generated an increase in the foreign exchange loss of Ps. 52.7 million. The currency translation effect increased Ps. 80.7 million, compared to 2Q20.

  • An increase in interest expenses of Ps. 53.6 million, or 15.0%, compared to 2Q20, mainly due to higher debt as a result of the issuance of long-term bonds and bank loans disbursed during 2020.

  • Interest income increased by Ps. 11.3 million, or 11.7%, compared to 2Q20, mainly due to an increase in the average balance of cash and cash equivalents during 2Q21 as compared to 2Q20.

In 2Q21, comprehensive income increased by Ps. 2,247.0 million, or 237.5%, compared to 2Q20. This increase was mainly due to the Ps. 2,560.4 million increase in profit before taxes derived from the significant increase in passenger traffic, as well as the Ps. 311.2 million increase in the cash flow hedge reserve. This increase was partially offset by an increase in income taxes of Ps. 554.2 million.

During 2Q21, net income increased by Ps. 2,006.2 million, or 344.6%, compared to 2Q20. Income taxes increased by Ps. 633.7 million and were partially offset by a Ps.79.6 million increase in the benefit for deferred taxes, mainly due to a higher inflation rate, that went from deflation of 0.62% in 2Q20 to inflation of 1.01% in 2Q21.

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

6M20 6M21 Change
Revenues
Aeronautical services 3,675,657 5,096,371 38.7%
Non-aeronautical services 1,353,482 1,547,138 14.3%
Improvements to concession assets (IFRIC 12) 1,424,757 1,890,226 32.7%
Total revenues 6,453,897 8,533,734 32.2%
Operating costs
Costs of services: 1,380,112 1,348,342 (2.3%)
Employee costs 486,466 533,462 9.7%
Maintenance 211,805 203,476 (3.9%)
Safety, security & insurance 229,405 248,431 8.3%
Utilities 171,319 172,764 0.8%
Other operating expenses 281,117 190,209 (32.3%)
Technical assistance fees 141,041 223,798 58.7%
Concession taxes 538,427 517,657 (3.9%)
Depreciation and amortization 987,231 1,013,125 2.6%
Cost of improvements to concession assets (IFRIC 12) 1,424,757 1,890,226 32.7%
Other expense (income) 9,022 (637) (107.1%)
Total operating costs 4,480,591 4,992,510 11.4%
Income from operations 1,973,307 3,541,224 79.5%
Financial Result (326,183) (485,503) 48.8%
Share of loss of associates 3 1 66.7%
Income before income taxes 1,647,127 3,055,722 85.5%
Income taxes (421,271) (594,170) 41.0%
Net income 1,225,856 2,461,552 100.8%
Currency translation effect 1,351,131 (85,224) (106.3%)
Cash flow hedges, net of income tax (348,105) 240,027 169.0%
Remeasurements of employee benefit - net income tax (9,705) 1,837 118.9%
Comprehensive income 2,219,177 2,618,192 18.0%
Non-controlling interest (164,109) 650 100.4%
Comprehensive income attributable to controlling interest 2,055,068 2,618,842 27.4%
6M20 6M21 Change
EBITDA 2,960,536 4,554,349 53.8%
Comprehensive income 2,219,176 2,618,192 18.0%
Comprehensive income per share (pesos) 3.9558 5.0347 27.3%
Comprehensive income per ADS (US dollars) 1.7138 2.5293 19.2%
Operating income margin 30.6% 41.5% 35.7%
Operating income margin (excluding IFRIC 12) 39.3% 53.3% 35.5%
EBITDA margin 45.9% 53.4% 16.3%
EBITDA margin (excluding IFRIC 12) 58.9% 68.6% 16.5%
Costs of services and improvements / total revenues 43.5% 38.0% (12.7%)
Cost of services / total revenues (excluding IFRIC 12) 27.4% 20.3% (26.0%)

- Net income and comprehensive income per share for 1H21 were calculated based on 520,024,505 shares outstanding and for 1H20 were calculated based on 525,525,547 shares outstanding. U.S. dollar figures presented were converted from pesos to U.S. dollars at a rate of Ps. 19.9060 per U.S. dollar (the noon buying rate on June 30, 2021, as published by the U.S. Federal Reserve Board).
- For purposes of the consolidation of the Montego Bay and Kingston airports, the average exchange rate of Ps. 19.8027 per U.S. dollar for the six months ended June 30, 2021, was used.

Revenues (1H21 vs. 1H20)

  • Aeronautical services revenues increased by Ps. 1,420.7 million, or 38.7%.
  • Non-aeronautical services revenues increased by Ps. 193.7 million, or 14.3%.
  • Revenues from improvements to concession assets increased by Ps. 465.5 million, or 32.7%.
  • Total revenues increased by Ps. 2,079.8 million, or 32.2%.
  • The change in aeronautical services revenues was composed of the following factors:

    1. Revenues at the Company's Mexican airports increased by Ps. 1,529.8 million or 51.3% compared to 1H20, mainly as a result of the 44.9% increase in passenger traffic and the increase in the maximum tariffs applicable for 2021 as a result of the Extraordinary Review Process of our Master Development Program.

    2. Revenues from the Montego Bay airport decreased by Ps. 123.6 million, or 24.4%, compared to 1H20. This was mainly due to the 16.4% decrease in passenger traffic and the 6.6% appreciation of the peso versus the U.S. dollar during 1H21, which went from an average exchange rate of Ps. 21.6091 in 1H20 to Ps. 20.1847 in 1H21.

    3. Revenues from the Kingston airport increased by Ps. 14.4 million, or 7.8% compared to 1H20, mainly due to an increase in tariffs beginning in April 2020 and partially offset by a 20.4% decrease in passenger traffic and the 6.6% appreciation of the peso versus the dollar.

  • The change in non-aeronautical services revenues was composed primarily of the following factors:

    1. Revenues from the Company's Mexican airports increased by Ps. 218.6 million, or 20.3%, compared to 1H20. Revenues from businesses operated by third parties increased by Ps. 193.3 million, or 27.9%. This was mainly due to an increase in revenues from duty-free stores, food and beverage, time shares, retail, car rentals and other commercial revenues, which jointly increased by Ps. 176.7 million, or 32.3%. Revenues from businesses operated directly by the Company increased by Ps. 27.6 million, or 9.0%. This increase was primarily due to a Ps. 67.1 million increase in revenue from parking and was partially offset by a Ps. 49.7 million decrease in combined revenues from publicity and VIP lounges. The recovery of costs decreased by Ps. 2.4 million, or 3.3%.

    2. Revenues from the Montego Bay airport decreased by Ps. 10.6 million, or 5.2%, compared to 1H20. Revenues in U.S. dollars increased by US$ 0.2 million, or 1.5%. However, the 6.6% appreciation of the peso versus the dollar offset the revenue increase.

    3. Revenues from the Kingston airport declined by Ps. 14.2 million, or 18.8%, compared to 1H20. Revenues in U.S. dollars decreased by US$ 0.5 million, or 13.1%. The 6.6% appreciation of the peso versus the dollar further contributed to the decrease.
6M20 6M21 Change
Businesses operated by third parties:
Duty-free 177,674 222,438 25.2%
Food and beverage 177,321 203,829 14.9%
Retail 143,233 165,662 15.7%
Car rentals 156,716 175,653 12.1%
Leasing of space 105,197 110,244 4.8%
Time shares 53,543 80,020 49.4%
Ground transportation 50,674 61,072 20.5%
Communications and financial services 36,927 38,875 5.3%
Other commercial revenues 39,064 58,321 49.3%
Total 940,349 1,116,116 18.7%
Businesses operated directly by us:
Car parking 101,234 167,265 65.2%
VIP lounges 100,687 84,410 (16.2%)
Advertising 57,673 21,857 (62.1%)
Convenience stores 58,812 69,045 17.4%
Total 318,406 342,577 7.6%
Recovery of costs 94,727 88,445 (6.6%)
Total Non-aeronautical Revenues 1,353,482 1,547,138 14.3%

Figures expressed in thousands of Mexican pesos.

  • Revenues from improvements to concession assets2
    Revenues from improvements to concession assets (IFRIC-12) increased by Ps. 465.5 million, or 32.7%, compared to 1H20, mainly in:

    1. The Company's Mexican airports, which increased by Ps. 503.6 million, or 37.4%, as a result of the increase in committed investments in the Master Development Program for the 2020-2024 period.

    2. Improvements to concession assets at the Montego Bay airport decreased Ps. 38.1 million, or 48.0%. During 1H21, no investments in improvements to concession assets were made at the Kingston airport.

________________________
[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.

Total operating costs increased by Ps. 511.9 million, or 11.4%, compared to 1H20, mainly due to a Ps. 465.5 million, or 32.7%, increase in the cost of improvements to the concession assets (IFRIC-12) and a Ps. 61.9 million, or 8.3%, increase in concession taxes and technical assistance fees. This increase was partially offset by a Ps. 31.8 million, or 2.3% decrease in cost of services (excluding the cost of improvements to concession assets, operating costs increased Ps. 46.5 million, or 1.5%). Operating costs was composed primarily of the following factors:

Mexican Airports:

  • Operating costsincreased by Ps. 715.4 million, or 20.7%, compared to 1H20, primarily due to a Ps. 503.6 million, or 37.4%, increase in the cost of improvements to the concession assets (IFRIC-12), a Ps. 170.2 million, or 33.1%, increase in technical assistance fees and concession taxes as a result of the increase in revenues, a Ps. 35.4 million, or 4.9%, increase in depreciation and amortization and a Ps. 13.0 million, or 1.3%, increase in the cost of services.

The cost of services during 1H21 was mainly comprised of the following:

  • Employee costs increased Ps. 58.5 million, or 15.5%, compared to 1H20, mainly due to the recognition of labor provisions in accordance with the reform to the Labor Law in Mexico and the hiring of additional personnel as required for airport operations.
  • Safety, security, and insurance costs increased Ps. 23.4 million, or 15.3%, compared to 1H20.
  • Other operating expenses decreased by Ps. 69.5 million or 30.2%, compared to 1H20, mainly due to a Ps. 72.1 million, or 91.4%, decrease in the allowance for credit losses, professional fees, publicity, sanitation supplies, and the decrease in the purchase of supplies and donations to the medical sector for the prevention of COVID-19.

Montego Bay Airport:

  • Operating costs decreased by Ps. 177.7 million, or 24.6% compared to 1H20, mainly due to a Ps. 108.9 million, or 60.8%, decrease in concession taxes, a Ps. 17.7 million, or 8.7%, decrease in the cost of services, a Ps. 38.1 million, or 48.0%, decrease in the cost of improvements to concession assets (IFRIC-12), and a Ps. 10.1 million, or 4.0%, decrease in depreciation and amortization. Operating costs in U.S. dollars declined by US$ 9.2 million.

Kingston Airport:

  • Operating costs decreased by Ps. 25.7 million, or 8.5% compared to 1H20, mainly due to a Ps. 26.9 million, or 19.1%, decrease in the cost of services. Operating costs in U.S. dollars decreased by US$ 1.3 million.

Operating margin went from 30.6% in 1H20 to 41.5% in 1H21. Excluding the effects of IFRIC-12, operating margin went from 39.3% to 53.3% in 1H21. Operating income increased Ps. 1,567.9 million, or 79.5%, compared to 1H20. EBITDA margin increased 750 basis points from 45.9% in 1H20 to 53.4% in 1H21. Excluding the effects of IFRIC-12, EBITDA margin increased 970 basis points from 58.9% in 1H20 to 68.6% in 1H21. The nominal value of EBITDA was Ps. 4,554.3 million in 1H21 compared to Ps. 2,960.5 million in 1H20, an increase of 53.8%. Financial cost increased by Ps. 159.3 million, from a net expense of Ps. 326.2 million in 1H20 to a net expense of Ps. 485.5 million in 1H21. This increase was mainly the result of:

  • Foreign exchange rate fluctuations went from an income of Ps. 187.1 million in 1H20 to an income of Ps. 117.5 million in 1H21. This generated a decrease in the foreign exchange gain of Ps. 69.6 million. Currency translation effect income also decreased by Ps. 1,436.4 million as compared to 1H20, due to the fact that the exchange rate for 1H20 closed at Ps. 22.9715 and for 1H21 it closed at Ps. 19.8027, an appreciation by the peso of 13.8%.

  • An increase in interest expense of Ps. 92.3 million, or 13.1%, compared to 1H20, mainly due to higher debt as a result of the issuance of long-term bonds issued during 2021.

  • Interest income increased by Ps. 2.6 million, or 1.4%, compared to 1H20, mainly due to an increase in the average balance of cash and cash equivalents during 1H21.

In 1H21, comprehensive income increased Ps. 399.0 million, or 18.0% compared to 1H20. This increase was mainly due to the Ps. 1,408.6 million increase in profit before taxes and the Ps. 588.1 million increase in the cash flow hedge reserve. This increase was partially offset by a Ps. 1,436.4 million decrease in currency translation effect.

During 1H21, net income increased Ps. 1,235.7 million, or 100.8% compared to 1H20. Income taxes increased by Ps. 172.9 million, or 41.0%, as a result of a Ps. 332.1 million increase in current income taxes and were partially offset by a Ps. 159.2 million increase in the benefit for deferred taxes, mainly due to a higher inflation rate, that went from 0.6% in 1H20 to 3.4% in 1H21.

Statement of Financial Position

Total assets as of June 30, 2021, increased by Ps. 1,435.0 million as compared to June 30, 2020, primarily due to the following items: (i) improvements to concession assets of Ps. 1,026.5 million; (ii) machinery, equipment and leasehold improvements and advances to suppliers of Ps. 729.7 million; (iii) trade accounts receivable of Ps. 494.4 million and (iv) other current assets of Ps. 394.3 million. This was partially offset by a Ps. 1,022.6 million decrease in the value of concession assets (due to the valuation of the Jamaica concessions in U.S. dollars and the appreciation of the peso), among others.

Total liabilities as of June 30, 2021, increased by Ps. 2,063.7 million compared to June 30, 2020. This increase was primarily due to the following items: (i) issuance of Ps. 4,500.0 million in long-term bonds and (ii) concession taxes of Ps. 190.8 million. This was partially offset by decreases of: (i) Ps. 2,000.0 million in bank loans, (ii) Ps. 590.2 million in derivative financial instruments and (iii) Ps. 227.1 million in deferred taxes, among others.

Recent Events

On July 2, 2021, the Ps. 1,500.0 million maturity payment was made on 'GAP16' debt securities with the proceeds obtained from the issuance on May 7, 2021.

From March 1st, 2021, and as of the date of this report, the Company has repurchased 8,721,192 shares at an average price of Ps. 217.00 per share, for a total of Ps. 1,892.4 million.

Company Description

Grupo Aeroportuario del Pacífico, 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 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 2Q20 2Q21 Change 6M20 6M21 Change
Guadalajara
Aeronautical services 170,144 801,607 371.1% 975,551 1,428,326 46.4%
Non-aeronautical services 83,201 210,343 152.8% 302,391 372,292 23.1%
Improvements to concession assets (IFRIC 12) 172,627 281,771 63.2% 431,567 563,542 30.6%
Total Revenues 425,972 1,293,721 203.7% 1,709,507 2,364,159 38.3%
Operating (loss) income (12,121) 663,821 5576.7% 667,015 1,144,946 71.7%
EBITDA 79,807 756,372 847.7% 849,966 1,340,433 57.7%
Tijuana
Aeronautical services 128,227 502,450 291.8% 508,525 834,812 64.2%
Non-aeronautical services 46,017 114,282 148.4% 163,218 201,045 23.2%
Improvements to concession assets (IFRIC 12) 95,507 408,844 328.1% 238,766 814,066 240.9%
Total Revenues 269,750 1,025,577 280.2% 910,509 1,849,922 103.2%
Operating income 1,084 413,895 38089.0% 305,299 644,762 111.2%
EBITDA 62,999 475,112 654.2% 429,375 774,446 80.4%
Los Cabos
Aeronautical services 44,404 539,396 1114.7% 474,805 863,652 81.9%
Non-aeronautical services 37,445 217,022 479.6% 252,977 346,090 36.8%
Improvements to concession assets (IFRIC 12) 108,233 124,067 14.6% 270,583 222,815 (17.7%)
Total Revenues 190,082 880,484 363.2% 998,365 1,432,558 43.5%
Operating (loss) income (58,947) 548,325 1030.2% 392,276 819,034 108.8%
EBITDA 7,720 610,502 7807.6% 524,268 945,321 80.3%
Puerto Vallarta
Aeronautical services 29,989 329,995 1000.4% 484,538 555,761 14.7%
Non-aeronautical services 29,183 106,473 264.8% 170,709 175,514 2.8%
Improvements to concession assets (IFRIC 12) 75,804 78,275 3.3% 189,511 155,633 (17.9%)
Total Revenues 134,976 514,743 281.4% 844,758 886,909 5.0%
Operating (loss) income (49,519) 289,658 684.9% 387,502 453,018 16.9%
EBITDA (7,701) 332,049 4411.6% 469,982 542,136 15.4%
Montego Bay
Aeronautical services 50,229 247,781 393.3% 506,791 383,205 (24.4%)
Non-aeronautical services 58,020 115,814 99.6% 203,673 193,051 (5.2%)
Improvements to concession assets (IFRIC 12) 63,390 21,577 (66.0%) 79,377 41,273 (48.0%)
Total Revenues 171,639 385,172 124.4% 789,841 617,529 (21.8%)
Operating (loss) income (136,422) 102,791 175.3% 67,090 72,485 8.0%
EBITDA 517 224,576 43305.5% 320,634 315,892 (1.5%)

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

Airport 2Q20 2Q21 Change 6M20 6M21 Change
Guanajuato
Aeronautical services 21,967 148,653 576.7% 163,714 248,529 51.8%
Non-aeronautical services 16,977 36,051 112.4% 63,953 62,570 (2.2%)
Improvements to concession assets (IFRIC 12) 21,646 3,094 (85.7%) 54,116 6,187 (88.6%)
Total Revenues 60,590 187,798 210.0% 281,783 317,287 12.6%
Operating (loss) income (8,907) 116,878 1412.2% 113,980 186,058 63.2%
EBITDA 9,224 135,633 1370.4% 149,494 223,356 49.4%
Hermosillo
Aeronautical services 17,314 82,214 374.8% 100,283 143,002 42.6%
Non-aeronautical services 11,519 19,910 72.8% 35,810 35,761 (0.1%)
Improvements to concession assets (IFRIC 12) 2,898 4,341 49.8% 7,246 8,682 19.8%
Total Revenues 31,731 106,465 235.5% 143,339 187,446 30.8%
Operating (loss) income (15,892) 47,961 401.8% 31,792 70,345 121.3%
EBITDA 3,022 66,432 2098.3% 69,723 109,106 56.5%
Others (1)
Aeronautical services 89,602 371,509 314.6% 461,452 639,084 38.5%
Non-aeronautical services 49,280 89,727 82.1% 160,751 158,402 (1.5%)
Improvements to concession assets (IFRIC 12) 61,437 39,014 (36.5%) 153,592 78,027 (49.2%)
Total Revenues 200,319 500,250 149.7% 775,795 875,513 12.9%
Operating (loss) income (96,136) 118,958 223.7% (15,563) 134,498 964.2%
EBITDA (36,625) 182,761 599.0% 102,764 264,510 157.4%
Total
Aeronautical services 551,875 3,023,604 447.9% 3,675,657 5,096,371 38.7%
Non-aeronautical services 331,641 909,622 174.3% 1,353,482 1,544,725 14.1%
Improvements to concession assets (IFRIC 12) 601,542 960,983 59.8% 1,424,757 1,890,226 32.7%
Total Revenues 1,485,058 4,894,209 229.6% 6,453,898 8,531,322 32.2%
Operating (loss) income (376,860) 2,302,287 710.9% 1,949,390 3,525,147 80.8%
EBITDA 118,965 2,783,437 2239.7% 2,916,205 4,515,200 54.8%

(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 June 30 (in thousands of pesos):

2020 2021 Change %
Assets
Current assets
Cash and cash equivalents 15,748,829 15,502,987 (245,842) (1.6%)
Trade accounts receivable - Net 1,060,950 1,555,349 494,399 46.6%
Other current assets 821,097 1,215,368 394,271 48.0%
Total current assets 17,630,876 18,273,704 642,828 3.6%
Advanced payments to suppliers 367,078 627,829 260,751 71.0%
Machinery, equipment and improvements to leased buildings - Net 1,999,903 2,468,753 468,850 23.4%
Improvements to concession assets - Net 12,978,449 14,004,941 1,026,492 7.9%
Airport concessions - Net 11,426,767 10,404,130 (1,022,637) (8.9%)
Rights to use airport facilities - Net 1,318,500 1,245,103 (73,397) (5.6%)
Deferred income taxes 5,855,337 6,043,134 187,797 3.2%
Other non-current assets 212,791 157,094 (55,697) (26.2%)
Total assets 51,789,700 53,224,688 1,434,988 2.8%
Liabilities
Current liabilities 6,079,799 5,390,130 (689,669) (11.3%)
Long-term liabilities 22,821,284 25,574,660 2,753,376 12.1%
Total liabilities 28,901,083 30,964,790 2,063,707 7.1%
Stockholders' Equity
Common stock 6,185,082 4,185,082 (2,000,000) (32.3%)
Legal reserve 1,592,551 1,592,551 - 0.0%
Net income 1,227,550 2,463,307 1,235,757 100.7%
Retained earnings 9,940,035 9,927,597 (12,438) (0.1%)
Reserve for share repurchase 3,283,374 5,264,666 1,981,292 60.3%
Repurchased shares (1,733,374) (2,944,448) (1,211,074) 69.9%
Foreign currency translation reserve 1,711,320 951,116 (760,204) (44.4%)
Remeasurements of employee benefit - Net (3,099) (8,215) (5,116) 165.1%
Cash flow hedges- Net (520,200) (231,080) 289,120 (55.6%)
Total controlling interest 21,683,239 21,200,576 (482,663) (2.2%)
Non-controlling interest 1,205,379 1,059,323 (146,056) (12.1%)
Total stockholder's equity 22,888,618 22,259,899 (628,719) (2.7%)
Total liabilities and stockholders' equity 51,789,700 53,224,688 1,434,988 2.8%

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):

2Q20 2Q21 Change 6M20 6M21 Change
Cash flows from operating activities:
Consolidated net (loss) income (582,208) 1,423,973 344.6% 1,225,855 2,461,552 100.8%
Postemployment benefit costs 2,048 7,771 279.4% 6,666 16,671 150.1%
Allowance expected credit loss 41,084 (2,455) (106.0%) 87,051 21,070 (75.8%)
Depreciation and amortization 505,174 510,380 1.0% 987,231 1,013,125 2.6%
(Gain) loss on sale of machinery, equipment and improvements to leased assets (11,147) 739 106.6% (14,199) 1,335 109.4%
Interest expense 312,080 419,651 34.5% 626,261 800,790 27.9%
Share of profit of associate 89 - (100.0%) 3 (1) (133.3%)
Provisions 885 6,635 649.7% (1,345) (5,677) 322.1%
Income tax expense (97,616) 456,589 567.7% 421,271 594,170 41.0%
Unrealized exchange loss (111,964) (226,877) 102.6% 652,719 (63,839) (109.8%)
Net loss on derivative financial instruments 30,312 - (100.0%) 58,754 - (100.0%)
88,737 2,596,406 2826.0% 4,050,266 4,839,196 19.5%
Changes in working capital:
(Increase) decrease in
Trade accounts receivable 711,733 (243,232) (134.2%) 382,344 (316,920) (182.9%)
Recoverable tax on assets and other assets (617,650) (18,877) (96.9%) (458,057) (75,310) (83.6%)
(Decrease) increase
Concession taxes payable (411,611) 103,830 125.2% (376,329) 60,738 116.1%
Accounts payable (565,673) 174,976 130.9% (343,322) 216,618 163.1%
Cash (used) generated by operating activities (794,463) 2,613,101 428.9% 3,254,903 4,724,322 45.1%
Income taxes paid (152,568) (82,750) (45.8%) (629,357) (385,099) (38.8%)
Net cash flows provided by operating activities (947,031) 2,530,351 367.2% 2,625,546 4,339,223 65.3%
Cash flows from investing activities:
Machinery, equipment and improvements to concession assets (606,257) (849,081) 40.1% (1,244,295) (1,679,015) 34.9%
Cash flows from sales of machinery and equipment 28 2,296 8100.0% 193 2,947 1426.9%
Other investment activities (40,617) (27,577) (32.1%) (55,001) (24,372) (55.7%)
Net cash used by investment activities (646,847) (874,362) 35.2% (1,299,104) (1,700,441) 30.9%
Cash flows from financing activities:
Capital distribution - (2,000,000) 100.0% - (2,000,000) 100.0%
Debt securities 4,200,000 4,500,000 7.1% 7,200,000 4,500,000 (37.5%)
Payment from Debt securities - - 0.0% (2,200,000) - (100.0%)
Bank loans - (2,080,739) 100.0% - (5,860,151) 100.0%
Repurchase of shares - (872,890) 100.0% - (1,211,074) 100.0%
Interest paid (257,118) (433,039) 68.4% (608,416) (772,236) 26.9%
Bank loans 2,151,264 - (100.0%) 2,151,264 3,779,413 75.7%
Interest paid on lease (675) (438) (35.1%) (1,392) (940) (32.5%)
Payments of obligations for leasing (3,163) (2,985) (5.6%) (6,815) (6,045) (11.3%)
Net cash flows used in financing activities 6,090,308 (890,091) (114.6%) 6,534,640 (1,571,033) (124.0%)
Effects of exchange rate changes on cash held 278,509 8,698 (96.9%) 387,554 (9,311) (102.4%)
Net increase in cash and cash equivalents 4,774,939 774,596 (83.8%) 8,248,636 1,058,438 (87.2%)
Cash and cash equivalents at beginning of year 10,973,890 14,728,391 34.2% 7,500,193 14,444,549 92.6%
Cash and cash equivalents at the end of year 15,748,829 15,502,987 (1.6%) 15,748,829 15,502,987 (1.6%)

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

2Q20 2Q21 Change 6M20 6M21 Change
Revenues
Aeronautical services 551,875 3,023,604 447.9% 3,675,657 5,096,371 38.7%
Non-aeronautical services 331,641 911,151 174.7% 1,353,482 1,547,138 14.3%
Improvements to concession assets (IFRIC 12) 601,542 960,983 59.8% 1,424,757 1,890,226 32.7%
Total revenues 1,485,058 4,895,738 229.7% 6,453,897 8,533,734 32.2%
Operating costs
Costs of services: 643,554 695,644 8.1% 1,380,112 1,348,342 (2.3%)
Employee costs 239,260 289,828 21.1% 486,466 533,462 9.7%
Maintenance 97,402 109,037 11.9% 211,805 203,476 (3.9%)
Safety, security & insurance 104,079 124,605 19.7% 229,405 248,431 8.3%
Utilities 79,692 95,591 20.0% 171,319 172,764 0.8%
Other operating expenses 123,121 76,583 (37.8%) 281,117 190,209 (32.3%)
Technical assistance fees 8,777 135,441 1443.1% 141,041 223,798 58.7%
Concession taxes 94,721 303,817 220.7% 538,427 517,657 (3.9%)
Depreciation and amortization 505,174 510,380 1.0% 987,231 1,013,125 2.6%
Cost of improvements to concession assets (IFRIC 12) 601,542 960,983 59.8% 1,424,757 1,890,226 32.7%
Other (income) expense (58) 2,712 4775.9% 9,022 (637) (107.1%)
Total operating costs 1,853,710 2,608,977 40.7% 4,480,591 4,992,510 11.4%
(Loss) income from operations (368,651) 2,286,761 720.3% 1,973,307 3,541,224 79.5%
Financial Result (311,089) (406,199) 30.6% (326,183) (485,503) 48.8%
Share of loss of associates (83) - 100.0% 3 1 66.7%
Income (loss) before income taxes (679,823) 1,880,562 376.6% 1,647,127 3,055,722 85.5%
Income taxes 97,616 (456,589) (567.7%) (421,271) (594,170) 41.0%
Net (loss) income (582,207) 1,423,973 344.6% 1,225,856 2,461,552 100.8%
Currency translation effect (66,233) (146,953) 121.9% 1,351,131 (85,224) (106.3%)
Cash flow hedges, net of income tax (287,997) 23,233 108.1% (348,105) 240,027 169.0%
Remeasurements of employee benefit - net income tax (9,558) 735 107.7% (9,705) 1,837 118.9%
Comprehensive (loss) income (945,995) 1,300,988 237.5% 2,219,177 2,618,192 18.0%
Non-controlling interest 29,645 13,545 (54.3%) (164,109) 650 100.4%
Comprehensive (loss) income attributable to controlling interest (916,350) 1,314,533 243.5% 2,055,068 2,618,842 27.4%

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 Reseve 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 - - - - 1,227,550 - 1,227,550 (1,695) 1,225,855
Foreign currency translation reserve - - - - - 1,185,327 1,185,327 165,804 1,351,131
Remeasurements of employee benefit - Net - - - - - (9,705) (9,705) - (9,705)
Reserve for cash flow hedges - Net of income tax - - - - - (348,105) (348,105) - (348,105)
Balance as of June 30, 2020 6,185,082 1,592,551 3,283,374 (1,733,374) 11,167,585 1,188,022 21,683,240 1,205,379 22,888,618
Balance as of January 1, 2021 6,185,082 1,592,551 3,283,374 (1,733,374) 11,908,891 556,287 21,792,811 1,059,972 22,852,783
Reserve for share repurchase - - 1,981,292 - (1,981,292) - - - -
Capital distribution (2,000,000) - - - - - (2,000,000) - (2,000,000)
Repurchase of share - - - (1,211,074) - - (1,211,074) - (1,211,074)
Comprehensive income:
Net income - - - - 2,463,307 - 2,463,307 (1,756) 2,461,552
Foreign currency translation reserve - - - - - (86,330) (86,330) 1,106 (85,224)
Remeasurements of employee benefit - Net - - - - - 1,837 1,837 - 1,837
Reserve for cash flow hedges - Net of income tax - - - - - 240,027 240,027 - 240,027
Balance as of June 30, 2021 4,185,082 1,592,551 5,264,666 (2,944,448) 12,390,904 711,821 21,200,576 1,059,323 22,259,899

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 Pacífico, 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:

2Q19
2Q21
Change 6M20 6M21 Change
Total passengers 1,666.2 11,040.1 562.6% 13,391.4 18,446.9 37.8%
Total cargo volume (in WLUs) 462.2 688.7 49.0% 1,015.0 1,356.7 33.7%
Total WLUs 2,128.3 11,728.8 451.1% 14,406.4 19,803.5 37.5%
Aeronautical & non aeronautical services per passenger (pesos) 530.3 356.4 (32.8%) 375.6 360.1 (4.1%)
Aeronautical services per WLU (pesos) 259.3 257.8 (0.6%) 255.1 257.3 0.9%
Non aeronautical services per passenger (pesos) 199.0 82.5 (58.5%) 101.1 83.9 (17.0%)
Cost of services per WLU (pesos) 302.4 59.3 (80.4%) 95.8 68.1 (28.9%)

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

Passenger Traffic and Consolidated Results for 2Q21 and 1H21 compared to the same periods of 2019:

Domestic Terminal Passengers - 14 airports (in thousands):
Airport 2Q19 2Q21 Change 6M19 6M21 Change
Guadalajara 2,674.0 2,177.8 (18.6%) 5,094.4 3,751.4 (26.4%)
Tijuana * 1,533.7 1,773.3 15.6% 2,894.9 3,184.1 10.0%
Los Cabos 490.9 520.5 6.0% 885.5 887.4 0.2%
Puerto Vallarta 479.5 453.1 (5.5%) 831.3 753.5 (9.4%)
Guanajuato 532.3 394.9 (25.8%) 994.3 680.9 (31.5%)
Montego Bay 2.4 0.0 (100.0%) 4.2 0.0 (100.0%)
Hermosillo 475.0 360.8 (24.0%) 859.9 618.4 (28.1%)
Mexicali 303.4 273.0 (10.0%) 569.4 463.2 (18.6%)
Morelia 115.7 145.8 26.0% 225.9 255.7 13.2%
La Paz 256.3 228.5 (10.8%) 466.4 397.7 (14.7%)
Aguascalientes 162.3 144.6 (10.9%) 305.2 242.4 (20.6%)
Kingston 0.0 0.7 N/A 0.0 0.7 N/A
Los Mochis 103.3 91.7 (11.3%) 187.1 162.6 (13.1%)
Manzanillo 25.4 23.1 (8.8%) 49.2 40.3 (18.2%)
Total 7,154.1 6,587.9 (7.9%) 13,367.7 11,438.1 (14.4%)
*CBX users are classified as international passengers.
International Terminal Passengers - 14 airports (in thousands):
Airport 2Q19 2Q21 Change 6M19 6M21 Change
Guadalajara 1,088.6 949.3 (12.8%) 2,076.7 1,544.3 (25.6%)
Tijuana * 736.1 737.8 0.2% 1,394.2 1,162.6 (16.6%)
Los Cabos 963.1 983.4 2.1% 2,019.3 1,517.8 (24.8%)
Puerto Vallarta 713.7 575.8 (19.3%) 1,970.6 928.2 (52.9%)
Guanajuato 173.8 163.4 (6.0%) 345.1 248.8 (27.9%)
Montego Bay 1,179.9 656.8 (44.3%) 2,516.2 961.5 (61.8%)
Hermosillo 17.4 25.9 49.1% 34.5 45.8 32.8%
Mexicali 1.9 1.1 (40.7%) 3.3 1.8 (45.5%)
Morelia 105.8 101.8 (3.8%) 207.1 176.9 (14.6%)
La Paz 3.1 4.3 41.2% 6.6 8.3 24.9%
Aguascalientes 54.8 54.6 (0.3%) 99.3 88.6 (10.9%)
Kingston 0.0 183.4 N/A 0.0 298.8 N/A
Los Mochis 1.9 2.4 29.6% 3.5 4.0 13.4%
Manzanillo 15.2 12.1 (20.3%) 52.3 21.5 (59.0%)
Total 5,055.2 4,452.2 (11.9%) 10,728.8 7,008.7 (34.7%)
*CBX users are classified as international passengers.
Total Terminal Passengers - 14 airports (in thousands):
Airport 2Q19 2Q21 Change 6M19 6M21 Change
Guadalajara 3,762.6 3,127.2 (16.9%) 7,171.1 5,295.7 (26.2%)
Tijuana * 2,269.7 2,511.1 10.6% 4,289.1 4,346.6 1.3%
Los Cabos 1,453.9 1,503.9 3.4% 2,904.8 2,405.1 (17.2%)
Puerto Vallarta 1,193.2 1,028.9 (13.8%) 2,801.9 1,681.8 (40.0%)
Guanajuato 706.2 558.3 (20.9%) 1,339.4 929.7 (30.6%)
Montego Bay 1,182.5 656.8 (44.5%) 2,520.4 961.5 (61.9%)
Hermosillo 492.4 386.8 (21.4%) 894.5 664.2 (25.7%)
Mexicali 305.3 274.1 (10.2%) 572.7 465.0 (18.8%)
Morelia 221.5 247.6 11.8% 433.0 432.5 (0.1%)
La Paz 259.4 232.9 (10.2%) 473.0 406.0 (14.2%)
Aguascalientes 217.1 199.3 (8.2%) 404.6 330.9 (18.2%)
Kingston 0.0 184.1 N/A 0.0 299.5 N/A
Los Mochis 105.2 94.1 (10.6%) 190.6 166.6 (12.6%)
Manzanillo 40.5 35.2 (13.1%) 101.5 61.7 (39.2%)
Total 12,209.3 11,040.1 (9.6%) 24,096.5 18,446.9 (23.4%)
*CBX users are classified as international passengers.
CBX Users (thousands) Table 20
Airport 2Q19 2Q21 Change 6M19 6M21 Change
Tijuana 723.6 731.6 1.1% 1,370.9 1,152.6 (15.9%)

The Company took control of the operation of the Kingston airport on October 10, 2019, consequently no figures are available for comparison purposes from January to June 2019.

Consolidated Results and Other Data for 2Q21 and 1H21 compared with 2019 (in thousands of pesos):

2Q19 2Q21 Change 6M19 6M21 Change
Revenues
Aeronautical services 2,577,773 3,023,604 17.3% 5,209,098 5,096,371 (2.2%)
Non-aeronautical services 957,275 911,151 (4.8%) 1,858,600 1,547,138 (16.8%)
Improvements to concession assets (IFRIC 12) 122,363 960,983 685.4% 268,850 1,890,226 603.1%
Total revenues 3,657,411 4,895,738 33.9% 7,336,548 8,533,734 16.3%
Operating costs
Costs of services 705,304 695,644 (1.4%) 1,300,943 1,348,342 3.6%
Technical assistance fees 113,644 135,441 19.2% 229,218 223,798 (2.4%)
Concession taxes 292,887 303,817 3.7% 618,154 517,657 (16.3%)
Depreciation and amortization 425,839 510,380 19.9% 847,440 1,013,125 19.6%
Cost of improvements to concession assets (IFRIC 12) 122,363 960,983 685.4% 268,850 1,890,226 603.1%
Other (income) expense (5,025) 2,712 (154.0%) (8,933) (637) (92.9%)
Total operating costs 1,655,012 2,608,977 57.6% 3,255,672 4,992,510 53.3%
Income from operations 2,002,399 2,286,761 14.2% 4,080,877 3,541,224 (13.2%)
Financial Result (235,745) (406,199) 72.3% (318,354) (485,502) 52.5%
Income taxes (503,081) (456,589) (9.2%) (1,101,400) (594,170) (46.1%)
Net income 1,263,573 1,423,973 12.7% 2,661,123 2,461,552 (7.5%)
Currency translation effect (45,788) (146,953) 220.9% (139,739) (85,224) (39.0%)
Cash flow hedges, net of income tax - 23,233 100.0% - 240,027 100.0%
Remeasurements of employee benefit - net income tax (146) 735 (603.4%) (293) 1,837 (727.0%)
Comprehensive income 1,217,639 1,300,988 6.8% 2,521,091 2,618,192 3.9%
Non-controlling interest (19,763) 13,545 168.5% (44,929) 650 101.4%
Comprehensive income attributable to controlling interest 1,197,876 1,314,533 9.7% 2,476,162 2,618,842 5.8%
2Q19 2Q21 Change 6M19 6M21 Change
EBITDA 2,428,238 2,797,141 15.2% 4,928,317 4,554,349 (7.6%)
Comprehensive income 1,217,639 1,300,988 6.8% 2,521,091 2,618,192 3.9%
Comprehensive income per share (pesos) 2.17 2.5018 15.3% 4.4939 5.0347 12.0%
Comprehensive income per ADS (US dollars) 1.13 1.2568 11.2% 2.3395 2.5293 8.1%
Operating income margin 54.7% 46.7% (14.7%) 55.6% 41.5% (25.4%)
Operating income margin (excluding IFRIC 12) 56.6% 58.1% 2.6% 57.7% 53.3% (7.7%)
EBITDA margin 66.4% 57.1% (13.9%) 67.2% 53.4% (20.6%)
EBITDA margin (excluding IFRIC 12) 68.8% 71.2% 3.5% 69.7% 68.6% (1.7%)
Costs of services and improvements / total revenues 22.6% 33.8% 49.5% 21.4% 38.0% 77.4%
Cost of services / total revenues (excluding IFRIC 12) 20.0% 17.7% (11.4%) 18.4% 20.3% 10.3%
IR Contacts:
Saúl Villarreal, Chief Financial Officer svillarreal@aeropuertosgap.com.mx
Alejandra Soto, IRO and Corporate Finance Director asoto@aeropuertosgap.com.mx
Gisela Murillo, Investor Relations gmurillo@aeropuertosgap.com.mx / +523338801100 ext. 20294

Disclaimer

Grupo Aeroportuario del Pacifico SAB de CV published this content on 29 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2021 13:38:10 UTC.


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Sales 2021 18 891 M 944 M 944 M
Net income 2021 4 885 M 244 M 244 M
Net Debt 2021 11 929 M 596 M 596 M
P/E ratio 2021 25,3x
Yield 2021 2,61%
Capitalization 120 B 5 999 M 6 007 M
EV / Sales 2021 6,99x
EV / Sales 2022 6,15x
Nbr of Employees 1 688
Free-Float 71,9%
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Number of Analysts 16
Last Close Price 233,49 MXN
Average target price 247,99 MXN
Spread / Average Target 6,21%
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Managers and Directors
Raul Revuelta Musalem Chief Executive Officer
Saúl Villarreal García Chief Financial Officer
Alejandra Soto Finance Director & Investor Relations Officer
Laura Diez Barroso Azcárraga Chairman
Juan Francisco Martínez Mira Director-Quality, Innovation & IT