Grupo Aeroportuario del Pacifico Reports in July 2024 a Passenger Traffic Decrease of 5.6% Compared to 2023

Rhea-AI Summary

Grupo Aeroportuario del Pacifico (NYSE: PAC) reported a 5.6% decrease in total terminal passengers for July 2024 compared to July 2023. Key highlights include:

- Total passengers decreased from 5,999,400 to 5,663,100
- Domestic passengers declined by 7.8%
- International passengers decreased by 2.6%
- Tijuana, Los Cabos, and Puerto Vallarta airports saw decreases of 7.9%, 5.8%, and 3.3% respectively
- Montego Bay airport experienced a 13.7% decrease

The decline is primarily attributed to preventive revisions of Pratt & Whitney engines in A320neo and A321neo fleets, and Hurricane Beryl's impact on Jamaican airports. Despite the overall decrease, some airports like La Paz and Los Mochis saw increases in passenger traffic.

Positive

• New routes added: Tijuana – Beijing (Hainan Airlines) and Guadalajara – Tijuana (Aeroméxico)
• Load factors improved from 74.8% in July 2023 to 79.2% in July 2024
• Some airports like La Paz and Los Mochis saw increases in passenger traffic

Negative

• Total terminal passengers decreased by 5.6% compared to July 2023
• Domestic passengers declined by 7.8%
• International passengers decreased by 2.6%
• Major airports like Tijuana, Los Cabos, and Puerto Vallarta saw significant decreases in traffic
• Seats available during July 2024 decreased by 8.7% compared to July 2023

Insights

Financial Analyst

The 5.6% decrease in total passenger traffic for Grupo Aeroportuario del Pacifico (GAP) in July 2024 compared to July 2023 is a concerning trend. This decline is primarily attributed to the preventive revision of Pratt & Whitney engines in the A320neo and A321neo fleet, which likely led to flight cancellations and reduced capacity.

The impact varies across airports, with Tijuana (-7.9%), Los Cabos (-5.8%) and Montego Bay (-13.7%) showing significant declines. The 8.7% decrease in available seats further underscores the operational challenges. However, the increase in load factor from 74.8% to 79.2% suggests improved efficiency in capacity utilization.

While the addition of new routes (Tijuana-Beijing and Guadalajara-Tijuana) is positive, the overall trend indicates short-term headwinds for GAP's revenue and profitability. Investors should monitor the duration of the engine revision process and its ongoing impact on operations.

Aviation Industry Expert

The preventive revision of Pratt & Whitney engines in the A320neo and A321neo fleet is a significant industry-wide issue affecting multiple airlines and airport operators. This proactive measure, while necessary for safety, is causing substantial operational disruptions and financial impacts across the sector.

The varying impact across GAP's airports (e.g., Tijuana -7.9%, Los Cabos -5.8%, but Guadalajara +0.1%) suggests differences in fleet composition and route structures among airlines serving these locations. The closure of Jamaican airports due to Hurricane Beryl further highlights the vulnerability of Caribbean operations to weather events.

The introduction of the Tijuana-Beijing route by Hainan Airlines is noteworthy, potentially opening new opportunities for increased Chinese tourism and business travel to Mexico. This could partially offset some of the current traffic declines if successful.

Market Research Analyst

The divergence between domestic and international passenger trends is noteworthy. Domestic traffic saw a steeper decline (-7.8%) compared to international (-2.6%), suggesting potential shifts in travel patterns or economic factors affecting domestic Mexican travel more severely.

The performance variation across airports offers insights into regional trends. For instance, La Paz and Los Mochis showed growth, while Mexicali experienced a sharp decline (-40.3%). This disparity may reflect local economic conditions or changes in airline route strategies.

The 10% decrease in CBX (Cross Border Xpress) users at Tijuana airport is significant, potentially indicating reduced cross-border travel between the U.S. and Mexico. This could be due to economic factors, policy changes, or shifts in travel preferences.

Long-term, GAP's diversified airport portfolio and the potential for recovery as operational issues are resolved may provide resilience. However, the immediate outlook suggests challenges in maintaining growth and profitability levels seen in previous years.

GUADALAJARA, Mexico, Aug. 05, 2024 (GLOBE NEWSWIRE) -- Grupo Aeroportuario del Pacífico, S.A.B. de C.V., (NYSE: PAC; BMV: GAP) (“the Company” or “GAP”) announces preliminary terminal passenger traffic figures for July 2024, compared with July 2023.

For July 2024, the total number of terminal passengers at GAP’s 12 Mexican airports decreased by 4.9%, compared to July 2023. Tijuana, Los Cabos, and Puerto Vallarta airports presented a decrease in passenger traffic of 7.9%, 5.8%, and 3.3%, respectively, compared to July 2023. On the other hand, Montego Bay presented a decrease in passenger traffic of 13.7%.

Domestic Terminal Passengers (in thousands):

Airport	Jul-23	Jul-24	% Change	Jan- Jul 23	Jan- Jul 24	% Change
Guadalajara	1,136.6	1,085.2	(4.5%)	7,269.8	6,751.7	(7.1%)
Tijuana*	844.7	763.6	(9.6%)	5,148.0	4,847.0	(5.8%)
Los Cabos	301.7	293.5	(2.7%)	1,713.4	1,621.8	(5.3%)
Puerto Vallarta	302.5	306.8	1.4%	1,700.1	1,624.2	(4.5%)
Montego Bay	0.0	0.0	N/A	0.0	0.0	N/A
Guanajuato	226.6	185.4	(18.2%)	1,293.2	1,183.6	(8.5%)
Hermosillo	190.3	183.7	(3.4%)	1,185.9	1,172.2	(1.2%)
Kingston	0.2	0.4	163.6%	0.7	1.6	109.2%
Morelia	82.1	58.6	(28.6%)	470.1	358.1	(23.8%)
La Paz	116.3	116.6	0.2%	626.9	676.0	7.8%
Mexicali	159.8	95.1	(40.5%)	887.0	609.7	(31.3%)
Aguascalientes	58.4	53.3	(8.7%)	365.4	361.9	(1.0%)
Los Mochis	44.6	50.5	13.3%	257.7	318.5	23.6%
Manzanillo	9.9	10.4	5.1%	62.7	76.7	22.2%
Total	3,473.6	3,203.1	(7.8%)	20,980.9	19,602.9	(6.6%)

International Terminal Passengers (in thousands):

Airport	Jul-23	Jul-24	% Change	Jan- Jul 23	Jan- Jul 24	% Change
Guadalajara	507.8	560.4	10.4%	3,014.5	3,420.5	13.5%
Tijuana*	449.3	428.1	(4.7%)	2,609.9	2,362.2	(9.5%)
Los Cabos	427.5	393.2	(8.0%)	3,031.2	3,001.0	(1.0%)
Puerto Vallarta	264.6	241.5	(8.7%)	2,529.4	2,682.9	6.1%
Montego Bay	513.7	443.4	(13.7%)	3,170.5	3,185.7	0.5%
Guanajuato	85.4	108.2	26.8%	503.5	597.5	18.7%
Hermosillo	6.5	7.0	6.9%	43.3	50.6	16.9%
Kingston	181.7	177.6	(2.3%)	1,011.3	988.2	(2.3%)
Morelia	54.9	62.7	14.1%	349.8	376.6	7.7%
La Paz	1.0	0.9	(16.7%)	8.8	7.0	(20.0%)
Mexicali	0.7	0.7	(3.4%)	4.2	4.4	5.5%
Aguascalientes	29.5	32.1	8.9%	162.3	183.3	12.9%
Los Mochis	0.7	0.8	13.8%	4.2	4.8	14.3%
Manzanillo	2.4	3.5	43.2%	45.1	59.6	32.2%
Total	2,525.8	2,460.0	(2.6%)	16,487.9	16,924.4	2.6%

Total Terminal Passengers (in thousands):

Airport	Jul-23	Jul-24	% Change	Jan- Jul 23	Jan- Jul 24	% Change
Guadalajara	1,644.4	1,645.6	0.1%	10,284.3	10,172.1	(1.1%)
Tijuana*	1,294.0	1,191.8	(7.9%)	7,757.9	7,209.2	(7.1%)
Los Cabos	729.2	686.7	(5.8%)	4,744.6	4,622.8	(2.6%)
Puerto Vallarta	567.1	548.3	(3.3%)	4,229.5	4,307.1	1.8%
Montego Bay	513.7	443.4	(13.7%)	3,170.5	3,185.7	0.5%
Guanajuato	311.9	293.6	(5.9%)	1,796.7	1,781.1	(0.9%)
Hermosillo	196.8	190.7	(3.1%)	1,229.1	1,222.8	(0.5%)
Kingston	181.9	178.0	(2.1%)	1,012.0	989.8	(2.2%)
Morelia	137.0	121.3	(11.5%)	819.9	734.7	(10.4%)
La Paz	117.4	117.4	0.0%	635.7	683.0	7.4%
Mexicali	160.5	95.8	(40.3%)	891.2	614.1	(31.1%)
Aguascalientes	87.9	85.4	(2.8%)	527.7	545.2	3.3%
Los Mochis	45.3	51.3	13.3%	261.9	323.4	23.5%
Manzanillo	12.4	13.9	12.6%	107.8	136.3	26.4%
Total	5,999.4	5,663.1	(5.6%)	37,468.8	36,527.3	(2.5%)

*Passengers in Tijuana who use CBX in both directions are classified as international.

CBX users (in thousands):

Airport	Jul-23	Jul-24	% Change	Jan- Jul 23	Jan- Jul 24	% Change
Tijuana	445.5	421.3	(5.4%)	2,588.2	2,328.9	(10.0%)

Highlights for the month:

• Passenger traffic: The decrease in passenger traffic is primarily a result of the preventive revision to the Pratt & Whitney engines of the A320neo and A321neo fleet. At the airports of Montego Bay and Kingston in Jamaica, the decrease is mainly due to the preventive measures taken in response to Hurricane Beryl, which kept both airports closed from July 2 at midnight, reactivating operations on July 4 in Montego Bay and on July 5 in Kingston.
  

• Seats and load factors: The seats available during July 2024 decreased by 8.7%, compared to July 2023. The load factors for the month went from 74.8% in July 2023 to 79.2% in July 2024.

• New routes:
  
  • Tijuana – Beijing: Hainan Airlines
  • Guadalajara – Tijuana: Aeroméxico
    

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 Concessioner 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 Norman Manley International Airport operation in Kingston, Jamaica, and took control of the operation in October 2019.

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 involve criminal conduct or violations. The telephone number in Mexico, facilitated by a third party responsible for collecting these complaints, is 800 04 ETICA (38422) or WhatsApp +52 55 6538 5504. The website is www.lineadedenunciagap.com or by email at denuncia@lineadedenunciagap.com. GAP’s Audit Committee will be notified of all complaints for immediate investigation.

Alejandra Soto, Investor Relations and Social Responsibility Officer	asoto@aeropuertosgap.com.mx
Gisela Murillo, Investor Relations	gmurillo@aeropuertosgap.com.mx/+52 33 3880 1100 ext. 20294

FAQ

What was the total passenger decrease for Grupo Aeroportuario del Pacifico (PAC) in July 2024?

Grupo Aeroportuario del Pacifico (PAC) reported a 5.6% decrease in total terminal passengers for July 2024 compared to July 2023, with numbers falling from 5,999,400 to 5,663,100.

Which airports operated by PAC saw the largest decreases in passenger traffic in July 2024?

The airports with the largest decreases in passenger traffic were Montego Bay (13.7% decrease), Tijuana (7.9% decrease), Los Cabos (5.8% decrease), and Puerto Vallarta (3.3% decrease).

What factors contributed to the decrease in passenger traffic for PAC in July 2024?

The decrease was primarily due to preventive revisions of Pratt & Whitney engines in A320neo and A321neo fleets, and the impact of Hurricane Beryl on Jamaican airports, which caused closures in Montego Bay and Kingston.

Did PAC add any new routes in July 2024?

Yes, PAC added two new routes in July 2024: Tijuana – Beijing operated by Hainan Airlines, and Guadalajara – Tijuana operated by Aeroméxico.