20-F/A
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 20-F/A
Amendment
No. 1
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2006
Commission File Number: 1-15132
Grupo
Aeroportuario del Sureste, S.A.B. de C.V.
(Exact name of registrant as specified in its charter)
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Southeast Airport Group
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United Mexican States |
(Translation of registrants name into English)
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(Jurisdiction of incorporation or organization) |
Bosque
de Alisos No. 47A 4th Floor
Bosques de las Lomas
05120 México, D.F.
Mexico
(Address of principal executive offices)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
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Name of each exchange |
Title of each class:
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on which registered |
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Series B Shares, without par value, or shares
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New York Stock Exchange, Inc.* |
American Depositary Shares, as evidenced by American Depositary Receipts, or ADSs,
each representing ten shares
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New York Stock Exchange, Inc. |
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* |
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Not for trading, but only in connection with the registration of American Depositary
Shares, pursuant to the requirements of the Securities and Exchange Commission. |
Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
N/A
Indicate the number of outstanding shares of each of the issuers classes of capital or common
stock as of the close of the period covered by the annual
report:
Series B
shares, without par
value: 255,000,000
Series BB
shares, without par value: 45,000,000
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of
the Securities Act.
Yes þ No o
If this report is an annual or transition report, indicate by check mark if the registrant is not
required to file reports pursuant to Sections 13 or 15(d) of the Securities Exchange Act of 1934.
Yes o No þ
NoteChecking the box above will not relieve any registrant required to file reports pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those
Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports) and (2) has been subject
to such filing requirements for the past 90 days.
Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer,
or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in
Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer þ Accelerated filer o Non-accelerated filer o
Indicate by check mark which financial statement item the registrant has elected to follow:
Item 17 o Item 18 þ
If this is an annual report, indicate by check mark whether the registrant is a shell company (as
defined by Rule 12b-2 of the Exchange Act).
Yes o No þ
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i
Introduction.
This
Amendment No. 1 amends our annual report on Form 20-F filed
with the commission on June 29, 2007 (the
Original 20-F). The purpose of the amendment is to
present the integrated audit report of the Registrants
independent registered public accounting firm immediately prior to
the Registrants financial statements and to revise the
disclosure set forth in Item 15.
PART I
Item 1. Identity of Directors, Senior Management and Advisers
Not applicable.
Item 2. Offer Statistics and Expected Timetable
Not applicable.
Item 3. Key Information
SELECTED FINANCIAL DATA
We publish our financial statements in Mexican pesos. Pursuant to Financial Reporting
Standards (Normas de Informacion Financiera) accepted in Mexico, or Mexican NIF, financial data for
all periods in the financial statements included in Items 3, 5 and 8 and, unless otherwise
indicated, throughout this Form 20-F have been restated in constant pesos as of December 31, 2006.
This Form 20-F contains translations of certain peso amounts into U.S. dollars at specified
rates solely for the convenience of the reader. These translations should not be construed as
representations that the peso amounts actually represent such U.S. dollar amounts or could be
converted into U.S. dollars at the rate indicated. Unless otherwise indicated, U.S. dollar amounts
have been translated from Mexican pesos at an exchange rate of Ps. 10.8116 to U.S.$1.00, the
exchange rate for pesos on January 2, 2007, as published by Banco de Mexico, the Mexican Central
Bank. On June 29, 2007 the Federal Reserve Bank of New Yorks noon buying rate for Mexican
pesos was Ps. 10.79 to U.S.$1.00.
The following tables present a summary of our consolidated financial information and that of
our subsidiaries for each of the periods indicated. This information should be read in conjunction
with, and is qualified in its entirety by reference to, our financial statements, including the
notes thereto. Our financial statements are prepared in accordance with Mexican NIF, which differs
in certain significant respects from generally accepted accounting principles in the United States,
or U.S. GAAP. Reconciliation to U.S. GAAP of our net income and total stockholders equity is also
provided in this summary financial data. Note 16 to our financial statements provides a
description of the principal differences between Mexican NIF and U.S. GAAP as they relate to our
business.
Mexican NIF provides for the recognition of certain effects of inflation by restating
non-monetary assets and non-monetary liabilities using the Mexican National Consumer Price Index,
restating the components of stockholders equity using the Mexican National Consumer Price Index
and recording gains or losses in purchasing power from holding monetary liabilities or assets.
Mexican NIF requires the restatement of all financial statements to constant Mexican pesos as of
the date of the more recent balance sheet presented. Our audited financial statements
and all other financial information contained herein are accordingly presented in constant
pesos with purchasing power as of December 31, 2006 unless otherwise noted.
References in this annual report on Form 20-F to dollars, U.S. dollars or U.S.$ are to
the lawful currency of the United States of America. References in this annual report on Form 20-F
to pesos or Ps. are to the lawful currency of Mexico. We publish our financial statements in
pesos.
This annual report on Form 20-F contains references to workload units, which are units
measuring an airports passenger traffic volume and cargo volume. A workload unit currently is
equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo.
The summary financial and other information set forth below reflects our financial condition,
results of operations and certain operating data since the year ended December 31, 2002.
2
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Year ended December 31, |
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2002 |
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2003 |
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2004 |
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2005 |
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2006 |
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(in thousands of constant Mexican pesos as of December 31, 2006)(1) |
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(thousands of |
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dollars)(2) |
Income statement data: |
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Mexican NIF: |
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Revenues: |
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Aeronautical services(3) |
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Ps. |
1,187,630 |
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Ps. |
1,318,613 |
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Ps. |
1,602,630 |
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Ps. |
1,520,152 |
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Ps. |
1,587,904 |
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$ |
146,870 |
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Non-aeronautical services(4) |
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271,316 |
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340,181 |
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521,961 |
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627,308 |
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651,057 |
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60,218 |
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Total revenues |
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1,458,946 |
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1,658,794 |
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2,124,591 |
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2,147,460 |
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2,238,961 |
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207,088 |
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Operating expenses: |
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Costs of services |
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(404,451 |
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(418,176 |
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(502,494 |
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(558,116 |
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(620,036 |
) |
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(57,349 |
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Technical assistance fee(5) |
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(44,011 |
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(52,168 |
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(71,991 |
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(69,123 |
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(71,037 |
) |
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(6,570 |
) |
Concession fee(6) |
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(72,905 |
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(82,910 |
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(106,189 |
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(107,373 |
) |
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(111,804 |
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(10,341 |
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General and administrative expenses |
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(125,817 |
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(136,865 |
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(113,710 |
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(129,384 |
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(118,628 |
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(10,972 |
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Depreciation and amortization |
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(394,077 |
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(401,089 |
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(429,597 |
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(451,674 |
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(487,788 |
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(45,117 |
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Operating income |
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417,685 |
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567,586 |
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900,610 |
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831,790 |
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829,668 |
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76,739 |
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Net comprehensive financing (cost)
income |
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31,951 |
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27,386 |
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(30,866 |
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23,669 |
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15,214 |
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1,407 |
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Income before taxes, employees
statutory profit sharing and
extraordinary items |
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449,636 |
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594,972 |
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869,744 |
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855,459 |
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844,882 |
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78,146 |
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Provision for income taxes and
employees statutory profit sharing |
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(180,768 |
) |
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(262,325 |
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(198,053 |
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(260,115 |
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(301,113 |
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(27,851 |
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Income before extraordinary items |
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268,868 |
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332,647 |
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671,691 |
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595,344 |
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543,769 |
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50,295 |
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Extraordinary items |
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(9,812 |
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(20,267 |
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(19,046 |
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(9,327 |
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(15,654 |
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(1,448 |
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Net income |
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259,056 |
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312,380 |
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652,645 |
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586,017 |
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528,115 |
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48,847 |
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Basic and diluted earnings per share |
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0.86 |
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1.04 |
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2.18 |
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1.95 |
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1.76 |
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0.16 |
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Basic and diluted earnings per ADS
(unaudited)(7) |
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8.64 |
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10.41 |
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21.75 |
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19.53 |
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17.60 |
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1.63 |
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U.S. GAAP: |
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Revenues |
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1,458,946 |
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1,658,794 |
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2,124,591 |
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2,147,460 |
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2,235,092 |
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|
206,731 |
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Operating income |
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497,256 |
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650,427 |
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903,964 |
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789,862 |
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830,997 |
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76,862 |
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Net income (loss) |
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(406,723 |
) |
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304,729 |
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267,153 |
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|
470,261 |
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415,961 |
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|
38,474 |
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Basic and diluted earnings per share |
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(1.36 |
) |
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1.02 |
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0.89 |
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1.57 |
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1.39 |
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0.13 |
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Basic and diluted earnings per ADS
(unaudited)(7) |
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(13.56 |
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10.16 |
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8.91 |
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15.68 |
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13.87 |
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1.28 |
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Dividends per share(8) |
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1.88 |
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0.59 |
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0.63 |
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0.67 |
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0.70 |
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0.06 |
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Other Operating Data (Unaudited): |
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Total passengers (thousands of
passengers) |
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10,996.6 |
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12,190.0 |
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13,897.1 |
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13,321.3 |
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13,779.9 |
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13,779.9 |
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Total air traffic movements (thousands
of movements) |
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194.9 |
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198.0 |
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219.8 |
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209.9 |
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220.5 |
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220.5 |
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Total revenues per passenger (in pesos
or dollars) |
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132.7 |
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136.1 |
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152.9 |
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161.2 |
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|
162.5 |
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15.0 |
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3
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As of and for the year ended December 31, |
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2002 |
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2003 |
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2004 |
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2005 |
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2006 |
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(in thousands of constant Mexican pesos as of December 31, 2006) (1) |
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(thousands of |
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dollars)(2) |
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Balance Sheet Data: |
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Mexican NIF: |
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Cash and marketable securities |
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Ps. |
584,267 |
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Ps. |
803,442 |
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Ps. |
1,250,811 |
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Ps. |
1,595,743 |
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Ps. |
1,241,678 |
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$ |
114,847 |
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Total current assets |
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|
849,950 |
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|
1,155,653 |
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|
1,543,010 |
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|
1,933,931 |
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|
1,640,690 |
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|
151,753 |
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Airport concessions, net |
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|
8,939,377 |
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|
|
8,690,595 |
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|
8,441,814 |
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|
8,193,031 |
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|
7,944,154 |
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|
734,781 |
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Rights to use airport facilities, net |
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2,470,923 |
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2,386,955 |
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2,309,871 |
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2,183,373 |
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|
2,165,316 |
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|
200,277 |
|
Total assets |
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|
13,269,308 |
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|
13,552,213 |
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|
|
14,036,374 |
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|
14,633,450 |
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|
14,941,401 |
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|
|
1,381,979 |
|
Current liabilities |
|
|
144,431 |
|
|
|
176,365 |
|
|
|
206,148 |
|
|
|
367,164 |
|
|
|
245,341 |
|
|
|
22,692 |
|
Total liabilities |
|
|
602,320 |
|
|
|
717,982 |
|
|
|
782,993 |
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|
|
1,079,753 |
|
|
|
1,156,300 |
|
|
|
106,950 |
|
Capital Stock |
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|
12,335,507 |
|
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|
12,335,507 |
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|
|
12,335,507 |
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|
12,335,507 |
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|
12,335,507 |
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|
1,140,951 |
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Net equity/stockholders equity |
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|
12,666,988 |
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|
|
12,834,231 |
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|
|
13,253,381 |
|
|
|
13,553,697 |
|
|
|
13,785,101 |
|
|
|
1,140,951 |
|
U.S. GAAP: |
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Cash and cash equivalents |
|
|
517,132 |
|
|
|
490,328 |
|
|
|
1,023,649 |
|
|
|
1,117,236 |
|
|
|
828,706 |
|
|
|
76,650 |
|
Total current assets |
|
|
849,950 |
|
|
|
1,155,652 |
|
|
|
1,543,010 |
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|
|
1,979,655 |
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|
1,664,500 |
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|
153,960 |
|
Airport concessions, net |
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|
269,775 |
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|
208,581 |
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|
149,009 |
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|
89,448 |
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|
29,796 |
|
|
|
2,756 |
|
Rights to use airport facilities |
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|
1,937,925 |
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1,874,951 |
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1,815,827 |
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1,706,238 |
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|
|
1,655,139 |
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|
153,089 |
|
Total assets |
|
|
7,181,713 |
|
|
|
7,338,586 |
|
|
|
7,447,822 |
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|
|
7,885,714 |
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|
|
7,974,239 |
|
|
|
737,563 |
|
Total liabilities |
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|
145,198 |
|
|
|
173,779 |
|
|
|
205,874 |
|
|
|
373,494 |
|
|
|
256,721 |
|
|
|
23,745 |
|
Capital Stock |
|
|
6,736,070 |
|
|
|
6,736,070 |
|
|
|
6,736,070 |
|
|
|
6,736,070 |
|
|
|
6,736,070 |
|
|
|
623,041 |
|
Net equity/stockholders equity |
|
|
7,036,515 |
|
|
|
7,164,807 |
|
|
|
7,241,948 |
|
|
|
7,512,220 |
|
|
|
7,717,518 |
|
|
|
713,818 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mexican NIF: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources provided by operating
activities |
|
|
659,975 |
|
|
|
742,604 |
|
|
|
1,207,267 |
|
|
|
1,288,464 |
|
|
|
1,031,626 |
|
|
|
95,418 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources used in financing
activities |
|
|
(856,341 |
) |
|
|
(145,139 |
) |
|
|
(233,496 |
) |
|
|
(285,702 |
) |
|
|
(296,711 |
) |
|
|
(27,444 |
) |
Resources used in investing
activities |
|
|
(311,724 |
) |
|
|
(378,292 |
) |
|
|
(526,401 |
) |
|
|
(657,830 |
) |
|
|
(1,088,980 |
) |
|
|
(100,723 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase in cash and marketable
securities |
|
|
(508,090 |
) |
|
|
219,173 |
|
|
|
447,370 |
|
|
|
344,932 |
|
|
|
(354,065 |
) |
|
|
(32,749 |
) |
U.S. GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow provided by operating
activities |
|
|
693,228 |
|
|
|
822,864 |
|
|
|
1,131,379 |
|
|
|
1,253,433 |
|
|
|
1,043,218 |
|
|
|
96,491 |
|
Cash flow used in financing
activities |
|
|
(856,341 |
) |
|
|
(267,278 |
) |
|
|
(259,435 |
) |
|
|
(285,702 |
) |
|
|
(296,711 |
) |
|
|
(27,444 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow (used in) provided by
investing activities |
|
|
139 |
|
|
|
(626,838 |
) |
|
|
(353,866 |
) |
|
|
(841,129 |
) |
|
|
(991,516 |
) |
|
|
(91,709 |
) |
Effect of inflation on cash and cash
equivalents |
|
|
(11,639 |
) |
|
|
44,447 |
|
|
|
15,245 |
|
|
|
(33,015 |
) |
|
|
(43,521 |
) |
|
|
(4,025 |
) |
Increase (decrease) in cash and cash
equivalents |
|
|
(174,613 |
) |
|
|
(26,805 |
) |
|
|
533,323 |
|
|
|
93,587 |
|
|
|
(288,530 |
) |
|
|
(26,687 |
) |
|
|
|
(1) |
|
Per share peso amounts are expressed in pesos (not thousands of pesos). |
|
(2) |
|
Translated into dollars at the rate of Ps. 10.8116 per U.S. dollar, the Mexican
Central Bank exchange rate for Mexican pesos at January 2, 2007. Per share dollar amounts
are expressed in dollars (not thousands of dollars). |
|
(3) |
|
Revenues from aeronautical services include those earned from passenger charges,
landing charges, aircraft parking charges, charges for airport security services and
charges for use of passenger walkways. |
|
(4) |
|
Revenues from non-aeronautical services are earned from the leasing of space in
our airports, access fees collected from third parties providing services at our airports
and miscellaneous other sources. |
|
(5) |
|
Since April 19, 1999, we have paid ITA a technical assistance fee under the
technical assistance agreement entered into in connection with the purchase by Inversiones
y Tecnicas Aeroportuarias, S.A. de C.V. (ITA) of its Series BB shares. This fee is
described in Item 7. Major Shareholders and Related Party TransactionsRelated Party
TransactionsArrangements with ITA. |
|
(6) |
|
Each of our subsidiary concession holders is required to pay a concession fee to
the Mexican government under the Mexican Federal Duties Law. The concession fee is
currently 5% of each concession holders gross annual revenues from the use of public
domain assets pursuant to the terms of its concession. |
|
(7) |
|
Based on the ratio of 10 Series B shares per ADS. |
|
(8) |
|
Income tax was payable on the dividends because the distribution was not made from
our after-tax earnings account. |
|
(9) |
|
Shares outstanding for all periods presented were 300,000,000. |
4
EXCHANGE RATES
The following table sets forth, for the periods indicated, the high, low, average and
period-end, free-market exchange rate expressed in pesos per U.S. dollar. The average annual rates
presented in the following table were calculated using the average of the exchange rates on the
last day of each month during the relevant period. The data provided in this table is based on
noon buying rates published by the Federal Reserve Bank of New York for cable transfers in Mexican
pesos. We have not restated the rates in constant currency units. All amounts are stated in
pesos. We make no representation that the Mexican peso amounts referred to in this annual report
could have been or could be converted into U.S. dollars at any particular rate or at all.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange Rate |
Year Ended December 31, |
|
High |
|
Low |
|
Period End |
|
Average(1) |
2002 |
|
|
10.43 |
|
|
|
9.00 |
|
|
|
10.43 |
|
|
|
9.75 |
|
2003 |
|
|
11.41 |
|
|
|
10.11 |
|
|
|
11.24 |
|
|
|
10.85 |
|
2004 |
|
|
11.64 |
|
|
|
10.81 |
|
|
|
11.15 |
|
|
|
11.31 |
|
2005 |
|
|
11.41 |
|
|
|
10.41 |
|
|
|
10.63 |
|
|
|
10.89 |
|
2006 |
|
|
11.46 |
|
|
|
10.43 |
|
|
|
10.80 |
|
|
|
10.90 |
|
December 2006 |
|
|
10.99 |
|
|
|
10.77 |
|
|
|
10.80 |
|
|
|
10.85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2007: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 2007 |
|
|
11.09 |
|
|
|
10.77 |
|
|
|
11.04 |
|
|
|
10.96 |
|
February 2007 |
|
|
11.16 |
|
|
|
10.92 |
|
|
|
11.16 |
|
|
|
11.00 |
|
March 2007 |
|
|
11.18 |
|
|
|
11.01 |
|
|
|
11.04 |
|
|
|
11.11 |
|
April 2007 |
|
|
11.03 |
|
|
|
10.92 |
|
|
|
10.93 |
|
|
|
10.98 |
|
May 2007 |
|
|
10.93 |
|
|
|
10.74 |
|
|
|
10.74 |
|
|
|
10.82 |
|
|
|
|
(1) |
|
Average of month-end rates or daily rates, as applicable. |
|
Source: |
|
Federal Reserve noon buying rate. |
Except for the period from September through December 1982, during a liquidity crisis,
the Mexican Central Bank has consistently made foreign currency available to Mexican private-sector
entities (such as us) to meet their foreign currency obligations. Nevertheless, in the event of
renewed shortages of foreign currency, there can be no assurance that foreign currency would
continue to be available to private-sector companies or that foreign currency needed by us to
service foreign currency obligations or to import goods could be purchased in the open market
without substantial additional cost.
Fluctuations in the exchange rate between the peso and the U.S. dollar will affect the U.S.
dollar value of securities traded on the Mexican Stock Exchange, and, as a result, will likely
affect the market price of the ADSs. Such fluctuations will also affect the U.S. dollar conversion
by the depositary of any cash dividends paid in pesos.
On
December 29, 2006, the Federal Reserve noon buying rate was Ps.
10.80 per U.S.$1.00. On June 29, 2007, the Federal Reserve noon buying rate was
Ps. 10.79 per U.S. $1.00.
5
For a discussion of the effects of fluctuations in the exchange rates between the peso and the
U.S. dollar, see Item 10. Additional InformationExchange Controls.
RISK FACTORS
Risks Related to Our Operations
Hurricanes and other natural disasters have adversely affected our business and could continue to
do so in the future.
The southeast region of Mexico, like other Caribbean destinations, experiences hurricanes,
particularly during the third quarter of each year. Portions of the southeast region also
experience earthquakes from time to time. Natural disasters may impede operations, damage
infrastructure necessary to our operations and/or adversely affect the destinations served by our
airports. Any of these events could reduce our passenger traffic volume. The occurrence of
natural disasters in the destinations we serve has adversely affected, and could in the future
adversely affect, our business, results of operations, prospects and financial condition. We have
insured the physical facilities at our airports against damage caused by natural disasters,
accidents or other similar events, but do not have insurance covering losses due to resulting
business interruption. Moreover, should losses occur, there can be no assurance that losses caused
by damages to the physical facilities will not exceed the pre-established limits on the policies.
As a result of the impact of Hurricane Wilma described below, the cost of our annual insurance
premium covering property damage from hurricanes increased from
approximately
U.S.$362,000 before Hurricane Wilma
to U.S.$2.6 million currently.
On October 21, 2005, Hurricane Wilma struck the Yucatan Peninsula, causing severe damage to
the infrastructure of the Cancun and Cozumel airports and to our administrative office building in
Cancun. Cancun and Cozumel airports were closed for approximately 62 hours and 42 hours,
respectively, and airport operations were disrupted for several weeks thereafter. We were
instructed by the Mexican government to repair Cancun Airports
Terminal 1 building, and to put it back into service. The hurricane also inflicted extensive damage on the hotel
and tourist infrastructure in Cancun, the Mayan Riviera region and Cozumel, which led to sharply
reduced air passenger traffic at our airports, especially in the fourth quarter of 2005 and during
the first half of 2006. During the fourth quarter of 2005, our passenger traffic decreased 33.1%,
and revenues and operating income fell 32.6% and 86.5%, respectively, relative to the same period
in 2004, reflecting the decline in passenger traffic. Due to a recovery in the second half of
2006, however, our total passenger for the year 2006 traffic rose 3.44%, our revenues rose 4.26%
and our operating income was nearly unchanged (down 0.26%), each as compared to 2005. While tourism
in Cancun and the Mayan Riviera has by now largely recovered from Hurricane Wilma, Cozumel is still
in the process of recovering.
Other hurricanes, such as Hurricane Emily in July 2005 and Hurricane Ivan in September 2004,
have also affected our operations.
6
Our business is highly dependent upon revenues from Cancun International Airport.
In 2005 and 2006, Ps.1,608.9 million and Ps.1,693.5 million, respectively, or 74.9% and 75.6%
respectively, of our revenues were derived from operations at Cancun International Airport. During
2005 and 2006, Cancun International Airport represented 69.8% and 70.6%, respectively, of our
passenger traffic and 44.7% and 44.1%, respectively, of our air traffic movements. The
desirability of Cancun as a tourist destination and the level of tourism to the area is dependent
on a number of factors, many of which are beyond our control. We cannot assure you that tourism in
Cancun will not decline in the future, or that it will return to levels recorded before Hurricane
Wilma. Any event or condition affecting Cancun International Airport or the areas that it serves
could have a material adverse effect on our business, results of operations, prospects and
financial condition.
The September 11, 2001 terrorist attacks had a severe impact on the international air travel
industry and adversely affected our business. Similar events may do so again in the future.
The events of September 11, 2001 resulted in a significant decline in passenger traffic
worldwide and future terrorist attacks could result in similar declines.
The terrorist attacks on the United States on September 11, 2001 had a severe adverse impact
on the air travel industry, particularly on U.S. carriers and carriers operating international
service to and from the United States. Airline traffic in the United States fell precipitously
after the attacks. In Mexico, airline and passenger traffic decreased substantially, although the
decrease was less severe than in the United States. Our airports experienced a significant decline
in passenger traffic following September 11, 2001. Any future terrorists attacks, whether or not
involving aircraft, will likely adversely affect our business, results of operations, prospects and
financial condition.
Security enhancements following the events of September 11, 2001 have resulted in increased
costs and may expose us to greater liability.
The air travel business is susceptible to increased costs resulting from enhanced security and
higher insurance and fuel costs. Following the events of September 11, we reinforced security at
our airports. For a description of the security measures that we adopted, see Item 4.
Information on the CompanyBusiness OverviewNon-Aeronautical ServicesAirport Security. While
enhanced security at our airports has not resulted in a significant increase in our operating costs
to date, we may be required to adopt additional security measures in the future. In addition, our
general liability insurance premiums for 2002 increased substantially relative to our 2001 premiums
and may rise again in the future. Since October 2001, we carry a U.S.$50 million insurance policy
covering liabilities resulting from terrorist acts. Because our insurance polices do not cover
losses resulting from war in any amount or from terrorism for amounts greater than U.S.$50 million,
we could incur significant costs if we were to be directly affected by events of this nature. Any
such increase in our operating costs will have an adverse effect on our results of operations.
The users of airports, principally airlines, have been subject to increased costs following
the September 11 events. Airlines have been required to adopt additional security measures and
7
may be required to comply with more rigorous security guidelines in the future. Premiums for
aviation insurance have increased substantially and could escalate further. While governments in
other countries have agreed to indemnify airlines for liabilities they might incur resulting from
terrorist attacks, the Mexican government has not done so and has given no indication of any
intention to do the same. In addition, fuel prices and supplies, which constitute a significant
cost for airlines using our airports, may be subject to increases resulting from any future
terrorist attacks, a general increase in international hostilities or a reduction in output of
fuel, voluntary or otherwise, by oil producing countries. Such increases in airlines costs have
result in higher airline ticket prices and decreased demand for air travel generally, thereby
having an adverse effect on our revenues and results of operations. In addition, because a
substantial majority of our international flights involve travel to the U.S., we may be required to
comply with security directives of the U.S. Federal Aviation Authority, in addition to the
directives of Mexican aviation authorities.
Mexican aviation authorities recently adopted International Civil Aviation Organization
guidelines requiring checked baggage on all international commercial flights beginning in January
2006 to undergo a new comprehensive screening process. As of January 2006, we implemented the new
screening system for all departing international flights, and we implemented the same system for
domestic flights as of July 1, 2006. Although airlines, rather than holders of airport
concessions, are responsible for baggage screening under Mexican law, we decided to purchase,
install and operate the new screening equipment and supply this service to the airlines to
facilitate their compliance with the new policy. This could expose us to liability relating to the
purchase, installation and operation of the equipment, or require us to purchase, install and
operate additional equipment, if, among other possibilities, the new screening procedures were to
fail to detect or intercept any attempted terrorist act occurring or originating at our airports.
We cannot estimate the cost to us of any such liability, if any were to arise.
International events could have a negative impact on international air travel and our business.
Historically, a substantial majority of our revenues have been aeronautical services, and our
principal source of aeronautical revenues is passenger charges. Passenger charges are payable for
each passenger (other than diplomats, infants, transfer and transit passengers) departing from the
airport terminals we operate, collected by the airlines and paid to us. In 2006, passenger charges
represented 54.6% of our total revenues.
International events such as the terrorist attacks on the United States on September 11, 2001,
the war in Iraq and public health crises such as Severe Acute Respiratory Syndrome (or SARS) have
disrupted the frequency and pattern of air travel worldwide in recent years. Because our revenues
are largely dependent on the level of passenger traffic in our airports, any general increase of
hostilities relating to reprisals against terrorist organizations, further conflict in the Middle
East, outbreaks of health epidemics such as SARS, Avian influenza or other events of general
international concern (and any related economic impact of such events) could result in decreased
passenger traffic and increased costs to the air travel industry and, as a result, could cause a
material adverse effect on our business, results of operations, prospects and financial condition.
8
Our revenues are highly dependent on levels of air traffic, which depend in part on factors beyond
our control.
Our revenues are closely linked to passenger and cargo traffic volumes and the number of air
traffic movements at our airports. These factors directly determine our revenues from aeronautical
services and indirectly determine our revenues from non-aeronautical services. Passenger and cargo
traffic volumes and air traffic movements depend in part on many factors beyond our control,
including economic conditions in Mexico and the United States, the political situation in Mexico
and elsewhere in the world, the attractiveness of our airports relative to that of other competing
airports, fluctuations in petroleum prices (which can have a negative impact on traffic as a result
of fuel surcharges or other measures adopted by airlines in response to increased fuel costs) and
changes in regulatory policies applicable to the aviation industry. Any decreases in air traffic
to or from our airports as a result of factors such as these could adversely affect our business,
results of operations, prospects and financial condition.
Increases in international petroleum prices could reduce demand for air travel.
International prices of fuel, which represents a significant cost for airlines using our
airports, have increased in recent years and may be subject to further increases resulting from any
future terrorist attacks, a general increase in international hostilities or a reduction in output
of petroleum, voluntary or otherwise, by oil-producing countries. Such increases in airlines
costs have resulted in higher airline ticket prices and may decrease demand for air travel
generally, thereby having an adverse effect on our revenues and results of operations.
Our business is highly dependent upon the operations of Mexico City International Airport.
For the years ended December 2004, 2005 and 2006, approximately 83.5%, 84.3% and 80.6%
respectively, of our domestic passengers flew to or from our airports via Mexico City International
Airport. As a result, our domestic traffic is highly dependent upon the operations of Mexico City
International Airport. Mexico City International Airport is currently in the process of increasing
its capacity, but we cannot assure you that the airports operations will not decrease in the
future, that the capacity increase will be completed or, if completed, result in an increase in
passenger traffic at our airports. Any event or condition that adversely affects Mexico City
International Airport could adversely affect our business, results of operations, prospects and
financial condition.
Competition from other tourist destinations could adversely affect our business.
One of the principal factors affecting our results of operations and business is the number of
passengers using our airports. The number of passengers using our airports may vary as a result of
factors beyond our control, including the level of tourism in Mexico. In addition, our passenger
traffic volume may be adversely affected by the attractiveness, affordability and accessibility of
competing tourist destinations in Mexico, such as Acapulco, Puerto Vallarta and Los Cabos, or
elsewhere, such as Puerto Rico, Florida, Cuba, Jamaica, the Dominican Republic and other Caribbean
island and Central American destinations. The attractiveness of the destinations we serve is also
likely to be affected by perceptions of travelers as to the safety and
9
political and social stability of Mexico. There can be no assurance that tourism levels in
the future will match or exceed current levels.
The loss of one or more of our key customers could result in a loss of a significant amount of our
revenues.
Although the global airlines industry has recently shown signs of recovering, it has
experienced significant financial difficulties in recent years, marked by the filing for bankruptcy
protection of several major carriers in the U.S. in recent years. Our business and results of
operations could be adversely affected if we do not continue to generate comparable portions of our
revenue from our key customers, including Mexicana (which accounted for 9.6%, 10.4% and 9.1% of our
revenues in 2004, 2005 and 2006, respectively), American Airlines (which accounted for 6.8%, 6.1%
and 5.8% of our revenues in 2004, 2005 and 2006, respectively), Aeromexico (which accounted for
6.2%, 5.1% and 5.9% of our revenues in 2004, 2005 and 2006, respectively) and Continental Airlines
(which accounted for 5.4%, 5.1% and 4.7% of our revenues in 2004, 2005 and 2006, respectively). We
do not have contracts with any airlines that obligate them to continue providing service to our
airports. We can offer no assurance that competing airlines would seek to increase their flight
schedules if any of our key customers reduced their use of our airports. We expect that we will
continue to generate a significant portion of our revenues from a relatively small number of
airlines in the foreseeable future. We can offer no assurance that any of these airlines will
continue to use any or all of our airports. Our business and results of operations could be
adversely affected if we do not continue to generate comparable portions of our revenue from our
key customers.
In addition, Mexican law prohibits an international airline from transporting passengers from
one Mexican location to another (unless the flight originated outside Mexico), which limits the
number of airlines providing domestic service in Mexico. Accordingly, we expect to continue to
generate a significant portion of our revenues from domestic travel from a limited number of
airlines.
Revenues from passenger charges are not secured, and we may not be able to collect amounts invoiced
in the event of the insolvency of one of its principal airline customers.
In recent years, many airlines have reported substantial losses. Our revenues from passenger
charges from our principal airline customers are not secured by a bond or any other collateral.
Thus, in the event of the insolvency of any of these airlines, we would not be assured of
collecting any amounts invoiced to that airline in respect of passenger charges.
If a change in relations with our labor force should occur, such a change could have an adverse
impact on our results of operations.
Although we currently believe we maintain good relations with our labor force, if any
conflicts with our employees were to arise in the future, including with our unionized employees
(which accounted for approximately 39.0% of our total employees as of December 31, 2006), resulting
events such as strikes or other disruptions that could arise with respect to our workforce could
have a negative impact on our results of operations.
10
The operations of our airports may be disrupted due to the actions of third parties, which are
beyond our control.
As is the case with most airports, the operation of our airports is largely dependent on the
services of third parties, such as air traffic control authorities and airlines. We are also
dependent upon the Mexican government or entities of the government for provision of services such
as energy, supply of fuel to aircraft at our airports and immigration services for our
international passengers. We are not responsible for and cannot control the services provided by
these parties. Any disruption in or adverse consequence resulting from their services, including a
work stoppage or other similar event, may have a material adverse effect on the operation of our
airports and on our results of operations.
Our business could be adversely affected by a downturn in the U.S. economy.
In 2005 and 2006, 69.0% and 66.1% respectively, of the international passengers served by our
airports arrived or departed on flights originating in or departing to the United States. Thus,
our business is dependent on the condition of the U.S. economy, and is particularly influenced by
trends in the United States relating to leisure travel, consumer spending and international
tourism. Events and conditions affecting the U.S. economy may adversely affect our business,
results of operations, prospects and financial condition.
We cannot predict what effect any future terrorist attacks or threatened attacks on the United
States or any retaliatory measures taken by the United States in response to these events may have
on the U.S. economy. An economic downturn in the United States may negatively affect our results
of operations and a prolonged economic crisis in the United States will likely have a material
adverse effect on our results of operations.
Fernando Chico Pardo, through his own investment vehicles and his 51% interest in Inversiones y
Tecnicas Aeroportuarias, S.A. de C.V., or ITA, has a significant influence as a shareholder and
over our management, and his interests may differ from those of other stockholders.
Following tender offers in the United States and Mexico for our Series B shares that expired
on June 19, 2007, Agrupacion Aeroportuaria Internacional, S.A. de C.V. and Agrupacion Aeroportuaria
Internacional II, S.A. de C.V., entities indirectly owned and controlled by Fernando Chico Pardo,
now own 19.5% of our capital stock in the form of Series B shares. The results of the tender
offers are described in greater detail in Item 7Major Shareholders and Related Party
TransactionsMajor ShareholdersTender Offer by Fernando Chico Pardo.
In addition, ITA,
an entity owned 51% by Mr. Chico Pardo and 49% by Copenhagen
Airports A/S (Copenhagen Airports),
holds Series BB shares representing 7.65% of our capital stock.
These Series BB shares provide it with special
management rights. For example, pursuant to our bylaws, ITA is entitled to present the board of
directors the name or names of the candidates for appointment as chief executive officer, to remove
our chief executive officer and to appoint and remove one half of the executive officers, and to
elect two members of our board of directors. ITA also has the right to veto certain actions
requiring approval of our stockholders. Our bylaws also provide ITA veto rights with respect to
certain corporate actions so long as its Series BB shares represent at least
11
7.65% of our capital stock. Special rights granted to ITA are more fully discussed in Item
10. Additional Information and Item 7. Major Shareholders and Related Party Transactions.
As a result,
Mr. Chico Pardo, who is also the chairman of our board of directors and our Chief
Executive Officer, is able to exert a significant influence over our
management and matters requiring the approval of our stockholders. The interests of Mr. Chico
Pardo, Copenhagen Airports and ITA may differ from those of our other stockholders, and there can
be no assurance that Mr. Chico Pardo, Copenhagen Airports or ITA will exercise their rights in ways
that favor the interests of our other stockholders. Furthermore, this concentration of ownership by
Mr. Chico Pardo and the special rights granted to ITA may have the effect of impeding a merger,
consolidation, takeover or other business combination involving ASUR.
Some of our board members and stockholders have business relationships that may generate conflicts
of interest.
Some of our board members or stockholders may have outside business relationships that
generate conflicts of interest. For example, Fernando Chico Pardo, the chairman of our board of
directors and the owner of 51% of the outstanding shares of ITA as well as 19.5% of ASURs shares,
our principal stockholder, also is a member of the board of directors of Grupo Posadas, S.A. de
C.V., a company that recently acquired an interest in Mexicana Airlines. Mexicana is our largest customer,
accounting for 9.6%, 10.4% and 9.1% of our revenues in 2004, 2005 and 2006, respectively.
Conflicts may arise between the interests of these or other individuals in their capacities as our
shareholders and/or directors, on the one hand, and their outside business interests on the other.
There can be no assurance that any conflicts of interest will not have an adverse effect on our
shareholders.
Our operations are at greater risk of disruption due to the dependence of most of our airports on a
single commercial runway.
As is the case with many other domestic and international airports around the world, most of
our airports, including Cancun International Airport, have only one commercial aviation runway.
While we seek to keep our runways in good working order and to conduct scheduled maintenance during
off-peak hours, we cannot assure you that the operation of our runways will not be disrupted due to
required maintenance or repairs. In addition, our runways may require unscheduled repair or
maintenance due to natural disasters, aircraft accidents and other factors that are beyond our
control. The closure of any runway for a significant period of time could have a material adverse
effect on our business, results of operations, prospects and financial condition.
Due to a significant increase in air traffic operations at Cancun International Airport, we
have concluded the necessary studies for the construction of a second runway at this airport and to
date we have obtained substantially all of the land needed to construct the second runway in
concession from the Mexican federal government. However, there can be no assurance that the land
obtained will be adequate for building the second runway. If we are unable to carry out the
construction or the operation of this second runway for any reason, it could limit the growth of
our business and adversely affect our results of operations, future prospects or financial
condition.
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We are exposed to risk related to construction projects.
The building requirements under our master development programs could encounter delays or
cause us to exceed our budgeted costs for such projects, which could
limit our ability to expand
capacity at our airports, increase our operating or capital expenses and could adversely affect our
business, results of operations, prospects and financial condition. Such delays or budgetary
overruns also could limit our ability to comply with our master development programs.
We are exposed to risks inherent to the operation of airports.
We are obligated to protect the public at our airports and to reduce the risk of accidents.
As with any company dealing with members of the public, we must implement certain measures for the
protection of the public, such as fire safety in public spaces, design and maintenance of car
parking facilities and access routes to meet road safety rules. We are also obligated to take
certain measures related to aviation activities, such as maintenance, management and supervision of
aviation facilities, rescue and fire-fighting services for aircraft, measurement of runway friction
coefficients and measures to control the threat from birds and other wildlife on airport sites.
These obligations could increase our exposure to liability to third parties for personal injury or
property damage resulting from our operations.
Our insurance policies may not provide sufficient coverage against all liabilities.
While we seek to insure all reasonable risks, we can offer no assurance that our insurance
policies would cover all of our liabilities in the event of an accident, terrorist attack or other
incident. The markets for airport insurance and construction insurance are limited, and a change
in coverage policy by the insurance companies involved could reduce our ability to obtain and
maintain adequate or cost-effective coverage. A certain number of our assets cannot, by their
nature, be covered by property insurance (notably aircraft movement areas, and certain civil
engineering works and infrastructure). In addition, we do not currently carry business
interruption insurance.
Changes to Mexican laws, regulations and decrees applicable to us could have a material
adverse impact on our results of operations.
The Mexican government has in recent years implemented changes, and is considering
implementing additional reforms, to the tax laws applicable to Mexican companies, including ASUR.
The terms of our concessions do not exempt us from any changes to the Mexican tax laws. Should the
Mexican government implement changes to the tax laws that result in our having significantly higher
income or asset tax liability, we will be required to pay the higher amounts due pursuant to any
such changes, which could have a material adverse impact on our results of operations. In
addition, changes to the Mexican constitution or to any other Mexican laws could also have a
material adverse impact on our results of operations.
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Risks Related to the Regulation of Our Business
Our concessions may be terminated under various circumstances, some of which are beyond our
control.
We operate each of our airports under 50-year concessions granted as of 1998 by the Mexican
government. A concession may be terminated for a variety of reasons. For example, a concession
may be terminated if we fail to make the committed investments required by the terms of that
concession. In addition, in the event that we exceed the applicable maximum rate at an airport in
any year, the Ministry of Communications and Transportation is entitled to reduce the applicable
maximum rate at that airport for the subsequent year and assess a penalty. Violations of certain
terms of a concession (including violations for exceeding the applicable maximum rate) can result
in termination only if sanctions have been imposed for violation of the relevant term at least
three times. Violations of other terms of a concession can result in the immediate termination of
the concession. We would face similar sanctions for violations of the Mexican Airport Law or its
regulations. Although we believe we are currently complying with the principal requirements of the
Mexican Airport Law and its regulations, we are not in compliance with certain requirements under
the regulations. These violations could result in fines or other sanctions being assessed by the
Ministry of Communications and Transportation, and are among the violations that could result in
termination of a concession if they occur three or more times. For a description of the
consequences that may result from the violation of various terms of our concessions, the Mexican
Airport Law or its regulations, see Item 4. Information on the CompanyRegulatory
FrameworkPenalties and Termination and Revocation of Concessions and Concession Assets. Under
applicable Mexican law and the terms of our concessions, our concessions may also be made subject
to additional conditions, which we may be unable to meet. Failure to meet these conditions may
also result in fines, other sanctions and the termination of the concessions.
In addition, the Mexican government may terminate one or more of our concessions at any time
through reversion (rescate), if, in accordance with applicable Mexican law, it determines that it
is required by national security or in the public interest to do so. In the event of a reversion
(rescate) of the public domain assets that are the subject of our concessions, such assets would
revert to the Mexican government and the Mexican government under Mexican law would be required to
compensate us, taking into consideration investments made and depreciation of the relevant assets,
but not the value of the assets subject to the concessions, based on the methodology set forth in
the reversion (rescate) resolution issued by the Mexican Ministry of Communications and
Transportation. There can be no assurance that we will receive compensation equivalent to the
value of our investment in our concessions and related assets in the event of such a reversion
(rescate).
In the event of war, natural disaster, grave disruption of the public order or an imminent
threat to national security, internal peace or the economy, the Mexican government may carry out a
requisition (requisa step-in rights) with respect to our airports. The step-in rights may be
exercised by the Mexican government as long as the circumstances warrant. In all cases, except
international war, the Mexican government is required to indemnify us for damages and lost profits
(daños y perjuicios) caused by such requisition, calculated at their real value (valor real);
provided that if we were to contest the amount of such indemnification, the amount of the
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indemnity with respect to damages (daños) shall be fixed by expert appraisers appointed by us
and the Mexican government, and the amount of the indemnity with respect to lost profits
(perjuicios) shall be calculated taking into consideration the average net income during the year
immediately prior to the requisition. In the event of requisition due to international war, the
Mexican government would not be obligated to indemnify us.
In the event that any one of our concessions is terminated, whether through reversion
(rescate) or otherwise, our other concessions may also be terminated. Thus, the loss of any
concession would have a material adverse effect on our business and results of operations. For a
discussion of events which may lead to a termination of a concession, see Item 4. Information on
the CompanyRegulatory FrameworkPenalties and Termination and Revocation of Concessions and
Concession Assets. Moreover, we are required to continue operating each of our nine airports for
the duration of our concessions, even if one or more of them are unprofitable.
The Mexican government could grant new concessions that compete with our airports, including the
Cancun International Airport.
The Mexican government could grant additional concessions to operate existing
government-managed airports, or authorize the construction of new airports, that could compete
directly with our airports. The Mexican government has announced that it intends, at some point in the future, to grant a
concession for a new airport in the Mayan Riviera through a public bidding process. The Mexican
state of Quintana Roo has formed a majority state-owned company to seek any such concession that
may be granted. Currently, the Mayan Riviera is served primarily by Cancun International Airport.
We have no further details on the construction or projected opening of the airport and are unable
to predict the effect that it may have on our passenger traffic or operating results if the project
is successfully carried out. Any competition from this or other such airports could have a
material adverse effect on our business and results of operations. Generally, the grant of a
concession for a new or existing airport is required to be made pursuant to a public bidding
process. In the event that a competing concession is offered in a public bidding process, it is
currently our intention to participate in such process, but we cannot assure you that we will
participate, or that we would be successful if we did participate. In addition, in certain
circumstances, the Mexican government can grant concessions without conducting a public bidding
process. Please see Item 4. Information on the CompanyRegulatory FrameworkGrants of New
Concessions below. Grants of new concessions that compete with our airports could adversely
affect our business, results of operations, prospects and financial condition.
We provide a public service regulated by the Mexican government and our flexibility in managing our
aeronautical activities is limited by the regulatory environment in which we operate.
Our aeronautical fees charged to airlines and passengers are, like most airports in other
countries, regulated. In 2004, 2005 and 2006, approximately 75.4%, 70.8% and 70.9% respectively,
of our total revenues were earned from aeronautical services, which are subject to price regulation
under our maximum rates. These regulations may limit our flexibility in operating our aeronautical
activities, which could have a material adverse effect on our business, results of operations,
prospects and financial condition. In addition, several of the regulations
15
applicable to our operations and that affect our profitability are authorized (as in the case
of our master development programs) or established (as in the case of our maximum rates) by the
Ministry of Communications and Transportation for five-year terms. Except under limited
circumstances, we generally do not have the ability to unilaterally change our obligations (such as
the investment obligations under our master development programs or the obligation under
concessions to provide a public service) or increase our maximum rates applicable under those
regulations should our passenger traffic or other assumptions on which the regulations were based
change during the applicable term. In addition, there can be no assurance that this price
regulation system will not be amended in a manner that would cause additional sources of our
revenues to be regulated.
We cannot predict how the regulations governing our business will be applied.
Many of the laws, regulations and instruments that regulate our business were adopted or
became effective in 1999, and there is only a limited history that would allow us to predict the
impact of these legal requirements on our future operations. In addition, although Mexican law
establishes ranges of sanctions that might be imposed should we fail to comply with the terms of
one of our concessions, the Mexican Airport Law and its regulations or other applicable law, we
cannot predict the sanctions that are likely to be assessed for a given violation within these
ranges. We cannot assure you that we will not encounter difficulties in complying with these laws,
regulations and instruments. Moreover, there can be no assurance that the laws and regulations
governing our business will not change.
The Ministry of Communications and Transportation has announced that it intends to establish a
new, independent regulatory agency to supervise the operation of our airports, as well as those of
other airports that have been opened to private investment. For further information on this
agency, see Item 4. Information on the CompanyRegulatory FrameworkNew Regulatory Agency. We
cannot predict whether or when this new agency will be organized, the scope of its authority, the
actions that it will take in the future or the effect of any such actions on our business.
The price regulatory system applicable to our airports does not guarantee that our consolidated
results of operations, or that the results of operations of any airport, will be profitable.
The system of price regulation applicable to our airports establishes an annual maximum rate
for each airport, which is the maximum annual amount of revenues per work load unit (which is equal
to one passenger or 100 kilograms (220 pounds) of cargo) that we may earn at that airport from
services subject to price regulation. The maximum rates for our airports have been determined for
each year through December 31, 2008. For a discussion of the framework for establishing our
maximum rates and the application of these rates, see Item 4. Information on the
CompanyRegulatory FrameworkPrice Regulation. Under the terms of our concessions, there is no
guarantee that the results of operations of any airport will be profitable.
Our concessions provide that an airports maximum rates will be adjusted periodically for
inflation. Although we are entitled to request additional adjustments to an airports maximum
rates under certain circumstances, our concessions provide that such a request will be approved
only if the Ministry of Communications and Transportation determines that certain events
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specified in our concessions have occurred. The circumstances under which we are entitled to
an adjustment are described under Item 4. Information on the CompanyRegulatory FrameworkPrice
RegulationSpecial Adjustments to Maximum Rates. Therefore, there can be no assurance that any
such request would be made or granted.
If we exceed the maximum rate at any airport at the end of any year, we could be subject to
sanctions.
Historically, we have set the prices we charge for regulated services at each airport as close
as possible to the prices we are allowed to charge under the maximum rate for that airport. We
expect to continue to pursue this pricing strategy in the future. For example, in 2006, our
revenues subject to maximum rate regulation represented 99.05% of the amount we were entitled to
earn under the maximum rates for all of our airports. There can be no assurance that we will be
able to establish prices in the future that allow us to collect virtually all of the revenue we are
entitled to earn from services subject to price regulation.
The specific prices we charge for regulated services are determined based on various factors,
including projections of passenger traffic volumes, the Mexican producer price index (excluding
petroleum) and the value of the peso relative to the U.S. dollar. These variables are outside of
our control. Our projections could differ from the applicable actual data, and, if these
differences occur at the end of any year, they could cause us to exceed the maximum rate at any one
or more of our airports during that year.
If we exceed the maximum rate at any airport at the end of any year, the Ministry of
Communications and Transportation may assess a fine and may reduce the maximum rate at that airport
in the subsequent year. The imposition of sanctions for violations of certain terms of a
concession, including for exceeding the airports maximum rates, can result in termination of the
concession if the relevant term has been violated and sanctions have been imposed at least three
times. In the event that any one of our concessions is terminated, our other concessions may also
be terminated.
Depreciation of the peso may cause us to exceed our maximum rates.
We aim to charge prices that are as close as possible to our maximum chargeable rates, and we
are entitled to adjust our specific prices only once every six months (or earlier upon a cumulative
increase of 5% in the Mexican producer price index (excluding petroleum)). However, we generally
collect passenger charges from airlines 30 to 115 days following the date of each flight. Such
tariffs for the services that we provide to international flights or international passengers are
generally denominated in U.S. dollars but are paid in Mexican pesos based on the average exchange
rate for the month prior to each flight. Accordingly, depreciation of the peso, particularly late
in the year, could cause us to exceed the maximum rates at one or more of our airports, which could
lead to the termination of one of our concessions. In the event that any one of our concessions is
terminated, our other concessions may also be terminated.
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Our results of operations may be adversely affected by required efficiency adjustments to our
maximum rates.
Our maximum rates are subject to annual efficiency adjustments, which have the effect of reducing
the maximum rates for each year to reflect projected efficiency improvements. For the five-year
term ending December 31, 2008, an annual efficiency adjustment factor of 0.75% was established by
the Ministry of Communications and Transportation. Future annual efficiency adjustments will be
determined by the Ministry of Communications and Transportation in connection with the setting of
each airports maximum rates every five years. For a description of these efficiency adjustments,
see Item 4. Information on the CompanyRegulatory FrameworkPrice RegulationMethodology for
Determining Future Maximum Rates. We cannot assure you that we will achieve efficiency
improvements sufficient to allow us to maintain or increase our operating income as a result of the
progressive decrease in each airports maximum rate.
Risks Related to Mexico
Economic developments in Mexico may adversely affect our business and results of operations.
Although a substantial portion of our revenues is derived from foreign tourism, domestic
passengers in recent years have represented approximately half of the passenger traffic volume in
our airports. In addition, all of our assets are located, and all of our operations are conducted,
in Mexico. As a result, our business, financial condition and results of operation could be
adversely affected by the general condition of the Mexican economy, by a devaluation of the peso,
by inflation and high interest rates in Mexico, or by political developments in Mexico.
Mexico has experienced adverse economic conditions.
In the past 25 years, and as recently as the mid-1990s, Mexico has experienced adverse
economic conditions, including high levels of inflation. From 1982 to 1987, Mexico experienced
periods of slow or negative growth, high inflation, large devaluations of the peso and limited
availability of foreign currency. In the late 1980s and early 1990s, Mexicos growth rate
increased, the inflation rate declined and the U.S. dollar/peso exchange rate was relatively stable.
Beginning in December 1994 and continuing through 1995, Mexico experienced an economic crisis
characterized by exchange rate instability, devaluation of the peso, high inflation, high domestic
interest rates, negative economic growth, reduced consumer purchasing power and high unemployment.
The economic crises occurred in the context of a series of internal disruptions and political
events, including a large current account deficit, civil unrest in the southern state of Chiapas
(in which one of our airports is located), the assassination of two prominent political figures, a
substantial outflow of capital and a significant devaluation of the peso.
In response, the Mexican government implemented a broad economic reform program. Economic
conditions in Mexico improved in 1996 and 1997. However, a combination of factors led to a
slowdown in Mexicos economic growth in 1998. Notably, the decline in the international price of
oil resulted in a reduction of federal revenues, approximately one third of which are derived from
petroleum taxes and duties. In addition, the economic crises in Asia and
18
Russia and the financial turmoil in Argentina, Brazil, Venezuela and elsewhere produced
greater volatility in the international financial markets, which further slowed Mexicos economic
growth. The Mexican government has reported that real GDP grew by 0.8%, 1.4%, 4.2%, 3.0% and 4.8%,
respectively, in 2002, 2003, 2004, 2005 and 2006. In 2006, inflation in Mexico was 4.1%, interest
rates on 28-day Mexican government treasury securities averaged 7.51% and the peso appreciated by
1.67% (in nominal terms) against the U.S. dollar.
We cannot assure you that similar events, or political developments in Mexico, will not occur,
or that any recurrence of these or similar events will not adversely affect our business, results
of operations, prospects and financial condition.
Depreciation or fluctuation of the peso relative to the U.S. dollar could adversely affect our
results of operations and financial condition.
Following the devaluation of the peso in December 1994, the aggregate passenger traffic volume
in our airports in 1995 decreased as compared to the prior year, reflecting a decrease in domestic
passenger traffic volume that more than offset an increase in international passenger traffic
volume. Any future depreciation of the peso is likely to reduce our aggregate passenger traffic
volume, which may have a material adverse effect on our results of operations. In addition, we
cannot assure you that any future depreciation of the peso would result in an increase in
international passenger traffic.
Devaluation or depreciation of the peso against the U.S. dollar may adversely affect the
dollar value of an investment in the ADSs and the Series B shares, as well as the dollar value of
any dividend or other distributions that we may make.
As of December 31, 2006 less than 11.0% of our liabilities (U.S.$3.46 million) were
dollar-denominated. Although we currently intend to fund the investments required by our business
strategy through cash flow from operations, we may incur dollar-denominated debt to finance all or
a portion of these investments. A devaluation of the peso would increase the debt service cost of
any dollar-denominated indebtedness that we may incur and result in foreign exchange losses.
Severe devaluation or depreciation of the peso, or government imposition of exchange controls,
may also result in the disruption of the international foreign exchange markets and may limit our
ability to transfer or to convert pesos into U.S. dollars and other currencies.
Political conditions in Mexico could materially and adversely affect Mexican economic policy and,
in turn, our operations.
National elections held on July 2, 2000 ended 71 years of rule by the Institutional
Revolutionary Party (PRI) with the election of President Vicente Fox Quesada, a member of the
National Action Party (PAN) and resulted in the increased representation of opposition parties in
the Mexican Congress and in mayoral and gubernatorial positions. On July 2, 2006, Felipe Calderon
Hinojosa, also of the PAN, was elected to succeed him. No single party currently has a majority in
the Congress or Senate. This shift in political power has transformed Mexico from a one-party
state to a pluralist democracy. Multiparty rule is still relatively new in Mexico and could result
in economic or political conditions that could materially and adversely affect our
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operations. The lack of a majority party in the legislature and the current lack of alignment
between the legislature and the President could result in instability or deadlock.
Increased environmental regulation and enforcement in Mexico may affect us.
The level of environmental regulation in Mexico has significantly increased in recent years,
and the enforcement of environmental laws is becoming substantially more stringent. We expect this
trend to continue and to be stimulated by international agreements between Mexico and the United
States. There can be no assurance that environmental regulations or their enforcement will not
change in a manner that could have a material adverse effect on our business, results of
operations, prospects or financial condition.
Developments in other countries may affect the prices of securities issued by Mexican companies.
The market value of securities of Mexican companies may be, to varying degrees, affected by
economic and market conditions in other countries. Although economic conditions in these countries
may differ significantly from economic conditions in Mexico, investors reactions to developments
in any of these other countries may have an adverse effect on the market value of securities of
Mexican issuers. In past years, prices of both Mexican debt and equity securities have been
adversely affected by sharp declines in Asian securities markets and by economic crises in Russia,
Brazil, Argentina and Venezuela. In addition, in recent years, economic conditions in Mexico have
become increasingly correlated to economic conditions in the United States. There can be no
assurance that the market value of our securities will not be adversely affected by events
elsewhere.
Corporate disclosure.
There may be different publicly available information about issuers of securities in Mexico
than is regularly published by or about issuers of securities in certain countries with highly
developed capital markets. In addition, differences in accounting and other reporting principles
and standards may cause our results to differ substantially from those results that would have been
obtained using other principles and standards, such as U.S. GAAP.
Mexican law and our bylaws restrict the ability of non-Mexican shareholders to invoke the
protection of their governments with respect to their rights as shareholders.
As required by Mexican law, our bylaws provide that non-Mexican shareholders shall be
considered as Mexicans in respect of their ownership interests in ASUR and shall be deemed to have
agreed not to invoke the protection of their governments in certain circumstances. Under this
provision, a non-Mexican shareholder is deemed to have agreed not to invoke the protection of his
own government by asking such government to interpose a diplomatic claim against the Mexican
government with respect to the shareholders rights as a shareholder, but is not deemed to have
waived any other rights it may have, including any rights under the U.S. securities laws, with
respect to its investment in ASUR. If you invoke such governmental protection in violation of this
agreement, your shares could be forfeited to the Mexican government.
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It may be difficult to enforce civil liabilities against us or our directors, officers and
controlling persons.
ASUR is organized under the laws of Mexico, with its principal place of business (domicilio
social) in Mexico City, and most of our directors, officers and controlling persons reside outside
the United States. In addition, all or a substantial portion of our assets and their assets are
located outside of the United States. As a result, it may be difficult for investors to effect
service of process within the United States on such persons or to enforce judgments against them,
including in any action based on civil liabilities under the U.S. federal securities laws. There is
doubt as to the enforceability against such persons in Mexico, whether in original actions or in
actions to enforce judgments of U.S. courts, of liabilities based solely on the U.S. federal
securities laws.
The protections afforded to minority shareholders in Mexico are different from those in the United
States.
Under Mexican law, the protections afforded to minority shareholders are different from those
in the United States. In particular, the law concerning fiduciary duties of directors is not as
fully developed as in other jurisdictions, there is no procedure for class actions, and there are
different procedural requirements for bringing shareholder lawsuits. As a result, in practice it
may be more difficult for minority shareholders of ASUR to enforce their rights against us or our
directors or controlling shareholder than it would be for shareholders of a company incorporated in
another jurisdiction, such as the United States.
Risks Related to Our ADSs
You may not be entitled to participate in future preemptive rights offerings.
Under Mexican law, if we issue new shares for cash as part of a capital increase, we generally
must grant our shareholders the right to purchase a sufficient number of shares to maintain their
existing ownership percentage in ASUR. Rights to purchase shares in these circumstances are known
as preemptive rights. We may not legally be permitted to allow holders of ADSs in the United
States to exercise any preemptive rights in any future capital increase unless we file a
registration statement with the U.S. Securities and Exchange Commission, or SEC, with respect to
that future issuance of shares, or the offering qualifies for an exemption from the registration
requirements of the Securities Act of 1933, as amended.
At the time of any future capital increase, we will evaluate the costs and potential
liabilities associated with filing a registration statement with the SEC and any other factors that
we consider important to determine whether we will file such a registration statement.
We cannot assure you that we will file a registration statement with the SEC to allow holders
of ADSs or shares in the United States to participate in a preemptive rights offering. In
addition, under current Mexican law, sales by the depository of preemptive rights and distribution
of the proceeds from such sales to you, the ADS holders, is not possible. As a result, your equity
interest in ASUR may be diluted proportionately.
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Holders of ADSs are not entitled to attend shareholders meetings, and they may only vote through
the depositary.
Under Mexican law, a shareholder is required to deposit its shares with the Secretary of the
Company, the S.D. Indeval Institución para el Depósito de Valores, S.A. de C.V., a Mexican or
foreign credit institution or a brokerage house in order to attend a shareholders meeting. A
holder of ADSs will not be able to meet this requirement, and accordingly is not entitled to attend
shareholders meetings. A holder of ADSs is entitled to instruct the depositary as to how to vote
the shares represented by ADSs, in accordance with the procedures provided for in the deposit
agreement, but a holder of ADSs will not be able to vote its shares directly at a shareholders
meeting or to appoint a proxy to do so.
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FORWARD LOOKING STATEMENTS
This Form 20-F contains forward-looking statements. We may from time to time make
forward-looking statements in our periodic reports to the Securities and Exchange Commission on
Forms 20-F and 6-K, in our annual report to shareholders, in offering circulars and prospectuses,
in press releases and other written materials and in oral statements made by our officers,
directors or employees to analysts, institutional investors, representatives of the media and
others. Examples of such forward-looking statements include:
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projections of operating revenues, net income (loss),
net income (loss) per share, capital expenditures,
dividends, capital structure or other financial items or
ratios, |
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statements of our plans, objectives or goals, |
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statements about our future economic performance or
that of Mexico or other countries in which we operate, and |
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statements of assumptions underlying such statements. |
Words such as believe, anticipate, plan, expect, intend, target, estimate,
project, predict, forecast, guideline, should and similar expressions are intended to
identify forward-looking statements but are not the exclusive means of identifying such statements.
Forward-looking statements involve inherent risks and uncertainties. We caution you that a
number of important factors could cause actual results to differ materially from the plans,
objectives, expectations, estimates and intentions expressed in such forward-looking statements.
These factors, some of which are discussed above under Risk Factors, include material changes in
the performance or terms of our concessions, developments in legal proceedings, economic and
political conditions and government policies in Mexico or elsewhere, inflation rates, exchange
rates, regulatory developments, customer demand and competition. We caution you that the foregoing
list of factors is not exclusive and that other risks and uncertainties may cause actual results to
differ materially from those in forward-looking statements.
Forward-looking statements speak only as of the date they are made, and we do not undertake
any obligation to update them in light of new information or future developments.
Item 4. Information on the Company
HISTORY AND DEVELOPMENT OF THE COMPANY
Grupo Aeroportuario del Sureste, S.A.B. de C.V., or ASUR, is a corporation (sociedad anónima
bursátil de capital variable) organized under the laws of Mexico. We were incorporated in 1998 as
part of the Mexican governments program for the opening of Mexicos airports to private-sector
investment. The duration of our corporate existence is indefinite. We are a holding company and
conduct all of our operations through our subsidiaries. The terms
ASUR, we and our in this annual report refer both to Grupo Aeroportuario del Sureste,
S.A.B. de C.V. as well as Grupo Aeroportuario del Sureste, S.A.B. de C.V. together with its
23
subsidiaries.
Our registered office is located at Bosque de Alisos No. 47A-4, Bosques de las Lomas,
05120 México, D.F., Mexico, telephone (5255) 5284-0400.
Investment by ITA
As part of the opening of Mexicos airports to investment, in 1998 the Mexican government sold
a 15% equity interest in ASUR in the form of 45,000,000 Series BB shares to ITA pursuant to a
public bidding process. Currently, Fernando Chico Pardo, our Chairman and Chief Executive Officer,
holds 51% of ITAs shares and Copenhagen Airports holds 49% of ITAs shares.
Mr. Chico Pardo became a stockholder in ITA in April 2004 when he acquired the 24.5% ownership
stake of French group Vinci, S.A. in ITA and a 13.5% ownership stake of Spanish Ferrovial
Aeropuertos, S.A in ITA. At the same time, Copenhagen Airports acquired Ferrovial Aeropuertos,
S.A.s 11.0% ownership interest in ITA, thereby increasing its participation in ITA from 25.5% to
36.5%. Mr. Chico Pardo acquired an additional 25.5% ownership stake in ITA through the exercise of
his right of first refusal following the auction of such shares by NAFIN, a Mexican national credit
institution and development bank controlled by the Mexican government. On April 29, 2005,
Copenhagen Airports increased its participation in ITA from 36.5% to 49% through the purchase
of shares from Mr. Chico Pardo.
In connection with the tender offers and other transactions undertaken by Mr. Chico Pardo in
June 2007, ITA converted 22,050,000 Series BB shares representing 7.35% of ASURs total outstanding
capital stock into Series B shares and transferred such shares
to Agrupación Aeroportuaria
Internacional, S.A. de C.V. by means of a spin-off. As a result, ITA currently holds 22,950,000 Series BB shares
representing 7.65% of ASURs total outstanding capital stock.
Mr. Chico Pardo is the founder and President of Promecap, S.C. He serves as a board member of
various organizations, including ITA, Grupo Posadas, Grupo Financiero Inbursa, Grupo
Carso, Sanborns Hermanos and Sears Roebuck de Mexico.
Copenhagen Airports is among the worlds leading airport operators and has won several
international awards. Copenhagen Airport is Scandinavias main airport. In 2006, approximately 21
million passengers were served at Copenhagen Airport. Additionally, Copenhagen Airports owns
and operates Roskilde Airport located about 30 kilometers from Copenhagen, and holds shares in
Newcastle International Airport in England.
ITA paid the Mexican government a total of Ps. 1,165.1 million (nominal pesos, excluding
interest) (U.S.$120.0 million based on the exchange rates in effect on the dates of payment) in
exchange for:
|
|
45,000,000 Series BB shares representing 15% of our
outstanding capital stock (as of the date hereof, Series BB
shares represent 7.65% of our outstanding capital stock. Please see
Item 7. Major Shareholders and Related Party
TransactionsMajor ShareholdersTender Offer by Fernando
Chico Pardo), |
|
|
|
three options to subscribe for newly issued Series B shares, all of which have expired unexercised, and |
|
|
|
the right and obligation to enter into various agreements with us and the Mexican government, including a
participation agreement, a technical assistance agreement and a |
24
|
shareholders agreement under terms established
during the public bidding process. These agreements are described in greater detail under Item 7. Major
Shareholders and Related Party TransactionsRelated Party Transactions. |
Under the technical assistance agreement, ITA provides management and consulting services and
transfers industry know-how and technology to ASUR in exchange for a technical assistance fee.
This agreement is more fully described in Item 7. Major Shareholders and Related Party
TransactionsRelated Party Transactions. The agreement provides us a perpetual and exclusive
license in Mexico to use all technical assistance and know-how transferred to us by ITA or its
stockholders during the term of the agreement. The agreement has an initial fifteen-year term, and
is automatically renewed for successive five-year terms, unless one party provides the other a
notice of termination within a specified period prior to a scheduled expiration date. ITA provides
us assistance in various areas, including: development of our commercial activities, preparation of
marketing studies focusing on increasing passenger traffic volume at our airports, assistance with
the preparation of the master development plans that we are required to submit to the Ministry of
Communications and Transportation with respect to each of our airports and the improvement of our
airport operations.
The technical assistance fee is equal to the greater of a fixed dollar amount or 5% of our
annual consolidated earnings before comprehensive financing cost, income taxes and depreciation and
amortization (determined in accordance with Mexican FRS and calculated prior to deducting the
technical assistance fee under this agreement). The fixed dollar amount decreased during the
agreements initial five years. The fixed dollar amount was U.S.$5.0 million in 1999 and 2000, and
U.S.$3.0 million in 2001 and 2002. Since 2003, the fixed dollar amount is U.S.$2.0 million before
the annual adjustment for inflation (measured by the U.S. consumer price index) as from the first
anniversary of the technical assistance agreement. We believe that this structure creates an
incentive for ITA to increase our annual consolidated earnings before net comprehensive financing
cost, income and asset taxes and depreciation and amortization. ITA is also entitled to
reimbursement for the out-of-pocket expenses it incurs in its provision of services under the
agreement. Under Mexican tax law, companies may not deduct fees that are determined by reference
to their profitability (as defined under Mexican tax law).
The technical assistance agreement allows ITA, its stockholders and their affiliates to render
additional services to ASUR only if the Acquisitions and Contracts Committee of our board of
directors determines that these related persons have submitted the most favorable bid in a public
bidding process involving at least three unrelated parties. For a description of this committee,
see Item 6. Directors, Senior Management and EmployeesCommittees.
Under our bylaws, the participation agreement and the technical assistance agreement, ITA has
the right to elect two members of our board of directors (which currently consists of seven
members) and their alternates, and to present the board of directors the name or names of the
candidates for appointment as our chief executive officer, to remove our chief executive officer,
and to appoint and remove half of our executive officers. As the holder of the Series BB shares,
ITAs consent is also required to approve certain corporate matters so long as ITAs
Series BB shares represent at least 7.65% of our capital stock. In addition, our bylaws, the
participation agreement and the technical assistance agreement contain certain provisions
25
designed
to avoid conflicts of interest between ASUR and ITA. The rights of ITA in our management are
explained in Item 6. Directors, Senior Management and EmployeesCommittees. ITAs stockholders
have entered into an agreement regarding the exercise of ITAs rights and performance of its
obligations under our bylaws, the participation agreement, the technical assistance agreement and
the option agreement. The ITA shareholders agreement is described in Item 7. Major Shareholders
and Related Party TransactionsMajor ShareholdersITA Trust and Shareholders Agreement.
The remaining 85% of our outstanding capital stock, which at that time (prior to the
conversion in June 2007 by ITA of 22,050,000 Series BB shares into 22,050,000 Series B shares)
consisted of 255,000,000 Series B shares, was sold by the Mexican government to a Mexican trust
established by NAFIN. This trust subsequently sold the shares it held in us to the public. To our
knowledge, the Mexican government no longer holds any of our shares.
Currently, ITA is restricted from transferring any of its remaining Series BB shares. After
December 18, 2008, ITA may sell in any year up to 20% of its remaining ownership interest in us
represented by Series BB shares. Our bylaws provide that Series BB shares must be converted into
Series B shares prior to transfer. For a more detailed discussion of ITAs rights to transfer its
stock, see Item 10. Additional InformationRegistration and Transfer.
As required under the participation agreement entered into in connection with the Mexican
governments sale of the Series BB shares of ASUR to ITA, ITA has transferred its Series BB shares
to a trust, the trustee of which is Banco Nacional de Comercio Exterior, S.N.C. Under the terms of
the participation agreement and the trust agreement, ITAs key
partners, currently Copenhagen
Airports and Fernando Chico Pardo, are each required to maintain an ownership interest in ITA
of a minimum of 25.5% prior to December 18, 2014 unless otherwise approved by the Ministry of
Communications and Transportation. To the extent that a key partner acquires shares of ITA in
excess of a 25.5% interest, this additional interest may be sold without restriction. See Item 7.
Major Shareholders and Related Party TransactionsMajor ShareholdersITA Trust and Shareholders
Agreement for a further description of these provisions. There can be no assurance that the terms
of the participation agreement or the trust would not be amended to reduce or eliminate these
ownership commitments. If ITA or any of its stockholders defaults on any obligation contained in
the trust agreement, or if ITA defaults on any obligation contained in the participation agreement
or the technical assistance agreement, after specified notice and cure provisions, the trust
agreement provides that the trustee may sell 5% of the shares held in the trust and pay the
proceeds of such sale to ASUR as liquidated damages.
Pursuant to the terms of the trust,
ITA may direct the trustee to vote shares currently
representing 7.65% of our capital stock, regarding all matters other
than capital reductions, payment of dividends, amortization of shares
and similar distributions to our shareholders, which are voted by the trustee
in accordance with the vote of the majority of Series B shares. The trust does not affect the veto
and other special rights granted to the holders of Series BB shares described in Item 10.
Additional Information.
26
Master Development Programs
Under the terms of our concessions, each of our subsidiary concession holders is required to
submit an updated master development plan for approval by the Ministry of Communications and
Transportation every five years. Each master development plan covers a fifteen-year period and
includes investment commitments for the regulated part of our business (including certain capital
expenditures and improvements) for the succeeding five-year period and investment projections for
the regulated part of our business (including certain capital expenditures and improvements) for
the remaining ten years. Once approved by the Ministry of Communications and Transportation, these
commitments become binding obligations under the terms of our concessions. Committed investments
are minimum requirements, and our capital expenditures may exceed our investment commitments in any
period. In December 2003, the Ministry of Communications and Transportation approved each of our
current updated master development plans. These plans are in effect from January 1, 2004 to
December 31, 2008.
The following table sets forth our committed investments for the regulated part of our
business for each airport pursuant to the terms of our current master development plans for the
periods presented. Even though we have committed to invest the amounts in the table, those amounts
could be lower or higher depending on the cost of each project.
Committed Investments
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
2007 |
|
|
2008 |
|
|
Total |
|
|
|
(thousands of pesos)(1) |
|
Cancun(2) |
|
Ps. |
334,960 |
|
|
Ps. |
432,206 |
|
|
Ps. |
847,797 |
|
|
Ps. |
1,052,919 |
|
|
Ps. |
83,298 |
|
|
Ps. |
2,751,180 |
|
Merida |
|
|
25,184 |
|
|
|
27,710 |
|
|
|
46,255 |
|
|
|
31,188 |
|
|
|
2,321 |
|
|
|
132,658 |
|
Cozumel |
|
|
10,598 |
|
|
|
68,984 |
|
|
|
12,442 |
|
|
|
16,280 |
|
|
|
10,828 |
|
|
|
119,132 |
|
Villahermosa |
|
|
47,407 |
|
|
|
63,602 |
|
|
|
6,360 |
|
|
|
11,892 |
|
|
|
1,303 |
|
|
|
130,564 |
|
Oaxaca |
|
|
21,502 |
|
|
|
21,150 |
|
|
|
10,257 |
|
|
|
6,624 |
|
|
|
4,829 |
|
|
|
64,362 |
|
Veracruz |
|
|
25,161 |
|
|
|
21,287 |
|
|
|
11,616 |
|
|
|
11,205 |
|
|
|
1,496 |
|
|
|
70,765 |
|
Huatulco |
|
|
9,820 |
|
|
|
5,450 |
|
|
|
3,990 |
|
|
|
6,816 |
|
|
|
52,560 |
|
|
|
78,636 |
|
Tapachula |
|
|
20,202 |
|
|
|
4,447 |
|
|
|
9,217 |
|
|
|
8,158 |
|
|
|
801 |
|
|
|
42,825 |
|
Minatitlan |
|
|
10,559 |
|
|
|
6,156 |
|
|
|
4,838 |
|
|
|
2,023 |
|
|
|
3,062 |
|
|
|
26,638 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
505,393 |
|
|
Ps. |
650,992 |
|
|
Ps. |
952,772 |
|
|
Ps. |
1,147,105 |
|
|
Ps. |
160,498 |
|
|
Ps. |
3,416,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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(1) |
|
Expressed in adjusted pesos as of December 31, 2006 based on the Mexican construction price
index in accordance with the terms of our master development plan. |
|
(2) |
|
The master development plan for Cancun airport was modified in the fourth quarter of 2005 to
reflect our decision to build a new terminal rather than implement extensive expansion and
remodeling of existing terminals, and to reflect an accelerated timetable for the construction
of a second runway once the necessary land to construct it is received from the government.
The Ministry of Communications and Transportation approved the modified plan and recognized
Ps. 1,433 million in investments as of December 31, 2006. |
27
The following table sets forth our historical capital expenditures made with respect to
the regulated and unregulated parts of our business in the periods indicated.
Capital Expenditures
|
|
|
|
|
Year ended December 31, |
|
(thousands
of pesos)(1) |
2004 |
|
Ps. |
442,937 |
|
2005 |
|
|
715,010 |
|
2006(2) |
|
|
1,040,633 |
|
|
|
|
(1) |
|
Expressed in constant pesos with purchasing power as of December 31, 2006. |
|
(2) |
|
Does not include the Ps. 48.3 million in connection with
the re-opening of Terminal 1 at the Cancun airport. |
In 2006, we spent Ps. 1,040.6 million for the construction of the Terminal 3 building at the
Cancun airport, which began operation in May 2007. In 2005, we spent Ps. 715.0 million for
purchases of machinery, furniture and equipment principally for the Cancun, Villahermosa and Merida
airports. In 2004, we spent Ps. 442.9 million for such purchases principally for the Cancun,
Huatulco and Veracruz airports.
Although we currently intend to fund the investments and working capital required by our
business strategy through cash flow from operations, we may incur debt to finance all or a portion
of these investments in the future.
BUSINESS OVERVIEW
We hold concessions to operate, maintain and develop nine airports in the southeast region of
Mexico for fifty years from November 1, 1998. As operators of these airports, we charge airlines,
passengers and other users fees for the use of the airports facilities. We also derive rental and
other income from commercial activities conducted at our airports, such as the leasing of space to
restaurants and retailers. Our concessions include the concession for Cancun International
Airport, the second busiest airport in Mexico in 2006 in terms of passenger traffic, according to
the Mexican Airport and Auxiliary Services Agency. We also hold concessions to operate the
airports in Cozumel, Huatulco, Merida, Minatitlan, Oaxaca, Tapachula, Veracruz and Villahermosa.
Mexico is one of the main tourist destinations in the world. Mexico has historically ranked
in the top ten countries worldwide in terms of foreign visitors, with 21.3
million visitors in 2006, according to the Mexican Ministry of Tourism. Within Latin America and
the Caribbean, Mexico ranked first in 2006 in terms of number of foreign visitors and income from
tourism, according to the World Tourism Organization. The tourism industry is one of the largest
generators of foreign exchange in the Mexican economy. Within Mexico, the southeast region (where
our airports are located) is a principal tourist destination due to its beaches and cultural and
archeological sites, which are served by numerous hotels and resorts.
Cancun and its surroundings were the most frequently visited international tourism destination
in Mexico in 2006, according to the Mexican Ministry of Tourism. Cancun International Airport
represented 72.0%, 69.8% and 70.6% of our passenger traffic volume and 76.4%, 74.9% and 75.6% of
our revenues in 2004, 2005 and 2006, respectively. At December 31, 2006, Cancun had approximately
23,824 hotel rooms, according to the Mexican Ministry of
28
Tourism. We believe that Cancun International Airport is positioned to benefit from its
proximity to the Mayan Riviera, a 129-kilometer (80-mile) stretch of coastal resorts and hotels
that is among Mexicos most rapidly developing tourism areas. According to the Mexican National
Trust for Tourism Development, the Mayan Riviera had approximately 31,397 hotel rooms as of
December 31, 2006.
Our airports served approximately 13.9 million passengers in 2004, approximately 13.3 million
passengers in 2005 and approximately 13.8 million passengers in 2006. For year-by-year passenger
figures, see Our Airports.
The United States currently is a significant source of passenger traffic volume in our
airports. In 2004, 2005 and 2006, international passengers represented 61.6%, 60.7% and 58.2%
respectively, of the total passenger traffic volume in our airports. In 2004, 2005 and 2006,
69.4%, 69.0% and 66.1% respectively, of the international passengers in our airports traveled on
flights originating in or departing to the United States. As of December 31, 2006, 18 Mexican and
104 international airlines, including U.S.-based airlines such as American Airlines and Continental
Airlines, were operating directly or through code-sharing arrangements (where one aircraft has two
or more flight numbers of different, allied airlines) in our airports.
Aeronautical Services
The following table sets forth our revenues for the period presented.
|
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|
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
|
(thousands of pesos) |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical Services |
|
Ps. |
1,602,630 |
|
|
Ps. |
1,520,152 |
|
|
Ps. |
1,587,904 |
|
Non-Aeronautical Services |
|
|
521,961 |
|
|
|
627,308 |
|
|
|
651,057 |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
2,124,591 |
|
|
Ps. |
2,147,460 |
|
|
Ps. |
2,238,961 |
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services represent the most significant source of our revenues. In 2004,
2005 and 2006, aeronautical revenues represented approximately 75.4%, 70.8% and 70.9%, of our total
revenues, respectively. All of our revenues from aeronautical services are regulated under the
dual-till price regulation system applicable to our airports.
Our revenues from aeronautical services are derived from: passenger charges, landing charges,
aircraft parking charges, charges for the use of passenger walkways and charges for the provision
of airport security services. Charges for aeronautical services generally are designed to
compensate an airport operator for its infrastructure investment and maintenance expense.
Aeronautical revenues are principally dependent on three factors: passenger traffic volume, the
number of air traffic movements and the weight of the aircraft.
Passenger Charges
We collect a passenger charge for each departing passenger on an aircraft (other than
diplomats, infants and transfer and transit passengers). We do not collect passenger charges from
arriving passengers. Passenger charges are automatically included in the cost of a passengers
ticket and generally collected twice monthly from each airline. As of December
29
2006, the charge for international passengers is U.S.$17.50 and the charge for domestic
passengers is Ps. 146.5(nominal pesos) for Cancun and Veracruz airports. For Cozumel, Huatulco and
Merida, Oaxaca and Villahermosa, and Minatitlan and Tapachula, we charge international passengers
U.S.$15.20, $11.40, $16.15 and $19.70 and domestic passengers Ps. 140.80, 105.60, 149.60 and 183.00
(nominal pesos), respectively. International passenger charges are currently dollar-denominated,
but generally collected in pesos based on the average exchange rate during the month prior to the
flight. Domestic passenger charges are peso-denominated. In each of 2005 and 2006, passenger
charges represented 80.0% and 76.9% respectively of our aeronautical revenues and 56.7% and 54.6%
respectively, of our total revenues. From time to time we have offered discounts on passenger
charges at certain of our airports.
Aircraft Landing and Parking Charges, Passenger Walkway Charges and Airport Security Charges
We collect various charges from carriers for the use of our facilities by their aircraft and
passengers. For each aircrafts arrival, we collect a landing charge that is based on the average
of the aircrafts maximum takeoff weight and the aircrafts weight without fuel. We also collect
aircraft parking charges based on the time an aircraft is at an airports gate or parking position.
Parking charges at several of our airports vary based on the time of day that the relevant service
is provided (with higher fees generally charged during peak usage periods at certain of our
airports). We collect aircraft parking charges the entire time an aircraft is on our aprons.
Airlines are also assessed charges for the connection of their aircraft to our terminals through a
passenger walkway. We also assess an airport security charge, which is collected from each airline
based on the number of its departing passengers. We provide airport security services at our
airports through third-party contractors. We also provide firefighting and rescue services at our
airports.
Landing charges represented 7.6%, 8.0% and 7.4%, of our aeronautical revenues and 5.7%, 5.7%
and 5.3%, of our total revenues in 2004, 2005 and 2006, respectively. Aircraft parking charges
represented 8.8%, 8.9% and 12.3%, of our aeronautical revenues and 6.6%, 6.3% and 8.7%, of our
total revenues in 2004, 2005 and 2006, respectively. Airport security charges represented 2.0%,
1.5% and 1.4%, of our aeronautical revenue and 1.6%, 1.1% and 1.0%, of our total revenues in 2004,
2005 and 2006, respectively. Passenger walkway charges represented 1.6%, 1.6% and 1.9%, of our
aeronautical revenues and 1.1%, 1.1% and 1.3%, of our total revenues in 2004, 2005 and 2006,
respectively.
Non-aeronautical Services
General
Non-aeronautical services have historically generated a proportionately smaller portion of our
revenues. Our revenues from non-aeronautical services are derived from commercial activities (such
as the leasing of space in our airports to retailers, restaurants, airlines and other commercial
tenants) and access fees charged to providers of complementary services in our airports (such as
catering, handling and ground transport). In 2004, 2005 and 2006, revenues from non-aeronautical
services represented 24.6%, 29.2% and 29.1% respectively, of our total
30
revenues, of which 78.0%, 77.1% and 77.3% respectively, were derived from commercial revenues
as defined under the Mexican Airport Law.
Currently, the leasing of space in our airports to airlines and other commercial tenants
represents the most significant source of our revenues from non-aeronautical services. Although
certain of our revenues from non-aeronautical services are regulated under our dual-till price
regulation system, our revenues from commercial activities (other than the lease of space to
airlines and other airport service providers that is considered essential to an airport) are not
regulated.
Commercial Activities
Leading international airports generally generate an important portion of their revenues from
commercial activities. An airports revenues from commercial activities is largely dependent on
passenger traffic, its passengers level of spending, terminal design, the mix of commercial
tenants and the basis of fees charged to businesses operating in the airport. Revenues from
commercial activities also depend substantially on the percentage of traffic represented by
international passengers due to the revenues generated from duty-free shopping.
In 2002, we opened 40 new commercial spaces in six of our airports, including new duty-free
shops, restaurants, bank and foreign exchange services, and convenience stores. In 2003 we
continued developing the commercial spaces in our airports by opening new bars and restaurants in
six of our airports as well as new retail stores in seven of our airports. In 2003 we dedicated
additional space to advertising in our Cancun airport and set aside additional rental space for car
exhibits at the Merida and Villahermosa airports. We opened 13 new retail stores in our Cancun,
Merida and Oaxaca airports in 2004, and 16 new retail stores at the Cancun, Cozumel, Villahermosa,
Oaxaca and Minatitlan airports in 2005.
In 2006, we opened 11 new retail stores in our Cancun, Merida, Oaxaca, Villahermosa and
Huatulco airports, and also entered into long-term agreements relating to commercial activities in
Cancun airports new Terminal 3. In October 2006, we entered into an agreement with Aldeasa
México, S.A. de C.V. for the operation of the duty-free shops to be located in Terminal 3. The
agreement will run for ten years from the date of the opening of
Terminal 3s duty-free shops in 2007. The new duty-free shops will cover
approximately 1,800 square meters and will have a walk-through layout. The agreement also provides
for an increase in the rent paid by Aldeasa on its existing duty-free shops in our Cancun airports
Terminal 2, Cozumel and Merida, as well as an extension of the terms of the leases on these stores.
In June 2006, we entered into a ten-year agreement with AB T3, S.A. de C.V. to provide food
and beverage services at our Cancun airports new Terminal 3. The facilities at Terminal 3 include
2000 square meters of food and beverage retail space, comprising a total of 10 units, with brands
and concepts aimed at providing the airports international passengers with world-class service.
Additionally, as of July 1, 2006, AB T2, S.A. de C.V. assumed responsibility for the operation of
the restaurant and snack bar at the Cancun airports Terminal 2
that were previously operated directly by the Cancun airport. Our contract with the current
provider, Mera Aeropuertos, S.A de C.V., was also extended, with an amendment to provide for a
higher concession fee paid by the leaseholder. These facilities had been part of
31
ASURs direct commercial operations since May 2004. AB T2, AB T3, and Mera Aeropuertos are
all affiliates of Controladora Mera, S.A. de C.V.
We estimate that prior to 2000 revenues from commercial activities in our terminals accounted
for less than 15% of the total revenues generated by our airports. In contrast, we believe that
revenues from commercial activities account for 25% or more of the consolidated revenues of many
leading international airports. Accordingly, a significant part of our business strategy is
focused on increasing our revenues from commercial activities in our airports.
Within our nine airports, we leased approximately 235 commercial premises as of December 31,
2006, including restaurants, banks, retail outlets (including duty-free stores), currency exchange
bureaus and car rental agencies. Our most important tenant in terms of occupied space and revenue
in 2006 were Aldeasa and Mera Aeropuertos and its affiliates. Generally, concessionaires pay a
monthly fee based on the higher of a fixed amount or a percentage of their revenues.
We are currently involved in legal proceedings in which we are seeking a confirmation of our
right to terminate certain lease agreements upon the expiration of their term. These proceedings
include litigation involving the duty-free stores in Cancun, Terminal 2. Although we cannot
predict when these proceedings will end, we expect that they will ultimately be resolved in our
favor.
In April 2005, the International Court of Arbitration issued a final ruling requiring Dufry
Mexico, S.A. de C.V., among other requirements, to deliver one of the duty-free stores that it
operated in the Cancun airport and to pay Ps. 41.1 million to ASUR. Dufry complied with this
ruling by making payment of Ps. 7.3 million in May 2005 and Ps. 33.8 million in August 2005.
Access Charges
At each of our airports, we earn revenues from charging access fees to various third-party
providers of complementary services, including luggage check-in, sorting and handling, aircraft
servicing at our gates, aircraft cleaning, cargo handling, aircraft catering services and
assistance with passenger boarding and deplaning. Our revenues from access charges are regulated
under our dual-till price regulation system. Under current regulations, each of these services
may be provided by the holder of an airport concession, by a carrier or by a third party hired by a
concession-holder or a carrier. Typically, these services are provided by third parties, whom we
charge an access fee based on a percentage of revenues that they earn at our airports. Six
different contractors provide handling services at our nine airports.
Consorcio Aeromexico, the parent of the Aeromexico airline, and Grupo Mexicana together own
Servicios de Apoyo en Tierra or SEAT, a company that provides certain complementary services,
such as baggage handling, to various carriers at airports throughout Mexico. SEAT operated at our
airports prior to our commencement of operations under our concessions and continues to do so.
Under the Mexican Airport Law, third-party providers of complementary services are required to
enter into agreements with the respective concession holder at that airport, which we did as of
December 27, 2000.
32
Under the Mexican Airport Law, we are required to provide complementary services at each of
our airports if there is no third party providing such services. SEAT is currently the sole
provider of baggage handling services at five of our airports. If SEAT ceased to provide such
services directly, we could be required to provide these services or find a third party to provide
such services.
Automobile Parking and Ground Transport
Each of our airports has public car parking facilities consisting of open-air parking lots.
The only airport at which we do not charge parking fees is Cozumel. In 2004, 2005 and 2006, our
revenues from parking lot fees were Ps. 27.7 million, Ps.34.0 million and Ps.37.7 million,
respectively. Revenues from parking at our airports currently are not regulated, although they
could become regulated upon a finding by the Mexican Antitrust Commission that there are no
competing alternatives.
We collect revenues from various commercial vehicle operators, including taxi, bus and other
ground transport operators. Our revenues from permanent providers of ground transport services,
such as access fees charged to taxis, are regulated activities, while our revenues from
non-permanent providers of ground transport services, such as access fees charged to charter buses,
are not regulated revenues.
Airport Security
The General Office of Civil Aviation, Mexicos federal authority on aviation, and the Office
of Public Security issue guidelines for airport security in Mexico. At each of our airports,
security services are provided by independent security companies that we hire. In recent years, we
have undertaken various measures to improve the security standards at our airports. These measures
included increasing the responsibilities of the private security companies that we hire, the
implementation in accordance with regulations issued by the International Civil Aviation
Organization (ICAO) of integrated computer tomography and baggage detection system for
international and domestic flights to detect explosive traces, the modernization of our carry-on
luggage scanning and security equipment, the implementation of strict access control procedures to
the restricted areas of our airports and the installation of a closed-circuit television monitoring
system in some of our airports.
In response to the September 11, 2001 terrorist attacks in the United States, we have taken
additional steps to increase security at our airports. At the request of the Transport Security
Administration of the United States, the General Office of Civil Aviation issued directives in
October 2001 establishing new rules and procedures to be adopted at our airports. Under these
directives, these rules and procedures were to be implemented immediately and for an indefinite
period of time.
To comply with these directives, we reinforced security by:
|
|
increasing and improving the security training of airport personnel, |
|
|
|
increasing the supervision and responsibilities of both our security personnel and airline security
personnel that operate in our airports, |
33
|
|
issuing new electronic identification cards to airport personnel, |
|
|
|
reinforcing control of different access areas of our airports, and |
|
|
|
physically changing the access points to several of the restricted areas of our airports. |
Airlines have also contributed to the enhanced security at our airports as they have adopted
new procedures and rules issued by the General Office of Civil Aviation applicable to airlines.
Some measures adopted by the airlines include adding more points for verification of passenger
identification, inspecting luggage prior to check-in and reinforcing controls over access to
airplanes by service providers (such as baggage handlers and food service providers). As
of January 1, 2006, we are providing additional services to the airlines, including providing
facilities to assist airlines in complying with requirements to screen all checked baggage on
international flights. We began providing similar assistance to domestic flights as of July 1,
2006.
Fuel
All airport property and installations related to the supply of aircraft fuel were retained by
the Mexican Airport and Auxiliary Services Agency in connection with the opening of Mexicos
airports to private investment. Pursuant to our concessions, the Mexican Airport and Auxiliary
Services Agency has entered into agreements obligating it to pay each of our subsidiary concession
holders a fee for access to our facilities equivalent to 1% of the service charge for fuel supply.
In the event that the Mexican government were to privatize fuel supply activities in the future,
the terms of our concessions provide that it will do so through a competitive bidding process.
Our Airports
In 2006, our airports served a total of 13.8 million passengers, approximately 58.2% of which
were international passengers. In 2005, our airports served a total of 13.3 million passengers,
approximately 60.7% of which were international passengers. In 2004, our airports served a total
of 13.9 million passengers, approximately 61.6% of which were international passengers. In 2004,
2005 and 2006, Cancun International Airport accounted for 72.0%, 69.8% and 70.6% of the passenger
traffic volume and 76.4%, 74.9% and 75.6% of revenues, respectively, from our nine airports.
All of our airports are designated as international airports under Mexican law, which
indicates that they are equipped to receive international flights and have customs and immigration
facilities.
34
The following table sets forth the number of passengers served by our airports based on flight
origination or destination.
Passengers by Flight Origin or Destination(1)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of |
Region |
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
2006 |
|
Total 2006 |
Mexico(2) |
|
|
4,814 |
|
|
|
5,309 |
|
|
|
5,620 |
|
|
|
5,493 |
|
|
|
6,016 |
|
|
|
43.7 |
% |
United States |
|
|
4,438 |
|
|
|
4,925 |
|
|
|
5,928 |
|
|
|
5,580 |
|
|
|
5,301 |
|
|
|
38.5 |
% |
Europe |
|
|
790 |
|
|
|
985 |
|
|
|
1,265 |
|
|
|
1,201 |
|
|
|
1,354 |
|
|
|
9.8 |
% |
Canada |
|
|
632 |
|
|
|
712 |
|
|
|
805 |
|
|
|
767 |
|
|
|
851 |
|
|
|
6.2 |
% |
Latin America |
|
|
315 |
|
|
|
256 |
|
|
|
279 |
|
|
|
280 |
|
|
|
255 |
|
|
|
1.8 |
% |
Asia and others |
|
|
8 |
|
|
|
3 |
|
|
|
0 |
|
|
|
0 |
|
|
|
3 |
|
|
|
0.0 |
% |
Total |
|
|
10,997 |
|
|
|
12,190 |
|
|
|
13,897 |
|
|
|
13,321 |
|
|
|
13,780 |
|
|
|
100 |
% |
|
|
|
(1) |
|
Figures exclude passengers in transit and private aviation passengers. |
|
(2) |
|
Figures include domestic flights taken by international passengers; in 2006, such flights accounted for 1.8%. |
In 2004, 2005 and 2006, approximately 83.5%, 84.3% and 80.6% respectively, of our
domestic passengers traveled to or from Mexico City.
The following table sets forth the total traffic volume and air traffic movements in our nine
airports for the periods presented:
Airport Traffic
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
2006 |
Passengers: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
10,996.6 |
|
|
|
12,190.0 |
|
|
|
13,897.3 |
|
|
|
13,321.3 |
|
|
|
13,779.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Air traffic movements:(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
194.9 |
|
|
|
198.0 |
|
|
|
219.8 |
|
|
|
209.9 |
|
|
|
220.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Includes landings and departures, in thousands. Air traffic movement data include the Cancun
charter terminal for all periods, because ASUR earned landing fees from all landings
regardless of the terminal used. |
35
The following table sets forth the passenger traffic volume for each of our airports
during the periods indicated:
Passenger Traffic
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
2006 |
Cancun |
|
|
7,718.0 |
|
|
|
8,684.2 |
|
|
|
10,010.7 |
|
|
|
9,301.5 |
|
|
|
9,728.1 |
|
Merida |
|
|
849.6 |
|
|
|
899.6 |
|
|
|
931.1 |
|
|
|
1,021.9 |
|
|
|
1,007.2 |
|
Cozumel |
|
|
445.9 |
|
|
|
455.8 |
|
|
|
584.4 |
|
|
|
486.6 |
|
|
|
370.7 |
|
Villahermosa |
|
|
499.1 |
|
|
|
599.7 |
|
|
|
673.3 |
|
|
|
717.4 |
|
|
|
725.0 |
|
Oaxaca |
|
|
433.2 |
|
|
|
461.0 |
|
|
|
543.2 |
|
|
|
563.7 |
|
|
|
495.6 |
|
Veracruz |
|
|
479.6 |
|
|
|
514.6 |
|
|
|
563.5 |
|
|
|
579.4 |
|
|
|
718.0 |
|
Huatulco |
|
|
268.4 |
|
|
|
259.4 |
|
|
|
270.8 |
|
|
|
312.0 |
|
|
|
375.3 |
|
Tapachula |
|
|
176.8 |
|
|
|
184.8 |
|
|
|
193.8 |
|
|
|
192.3 |
|
|
|
188.1 |
|
Minatitlan |
|
|
126.0 |
|
|
|
130.9 |
|
|
|
126.5 |
|
|
|
146.5 |
|
|
|
171.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
10,996.6 |
|
|
|
12,190.0 |
|
|
|
13,897.3 |
|
|
|
13,321.3 |
|
|
|
13,779.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Air Traffic Movements by Airport(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
2006 |
Cancun |
|
|
82,730 |
|
|
|
87,347 |
|
|
|
97,575 |
|
|
|
93,761 |
|
|
|
97,228 |
|
Merida |
|
|
22,827 |
|
|
|
24,213 |
|
|
|
26,534 |
|
|
|
25,449 |
|
|
|
27,610 |
|
Cozumel |
|
|
14,015 |
|
|
|
12,813 |
|
|
|
14,355 |
|
|
|
13,381 |
|
|
|
12,122 |
|
Villahermosa |
|
|
18,244 |
|
|
|
20,299 |
|
|
|
22,267 |
|
|
|
19,892 |
|
|
|
21,098 |
|
Oaxaca |
|
|
15,479 |
|
|
|
15,111 |
|
|
|
17,502 |
|
|
|
17,796 |
|
|
|
16,148 |
|
Veracruz |
|
|
19,034 |
|
|
|
19,737 |
|
|
|
22,228 |
|
|
|
20,520 |
|
|
|
24,905 |
|
Huatulco |
|
|
5,922 |
|
|
|
5,461 |
|
|
|
6,152 |
|
|
|
6,996 |
|
|
|
7,179 |
|
Tapachula |
|
|
12,032 |
|
|
|
7,658 |
|
|
|
7,686 |
|
|
|
6,169 |
|
|
|
6,621 |
|
Minatitlan |
|
|
4,602 |
|
|
|
5,362 |
|
|
|
5,598 |
|
|
|
5,937 |
|
|
|
7,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
194,885 |
|
|
|
198,001 |
|
|
|
219,897 |
|
|
|
209,901 |
|
|
|
220,536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Includes departures and landings. |
The following table sets forth the air traffic movements in our airports for the periods
indicated in terms of commercial, charter and general aviation:
Air Traffic Movements by Aviation Category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2002 |
|
2003 |
|
2004 |
|
2005 |
|
2006 |
Commercial Aviation |
|
|
147,362 |
|
|
|
143,788 |
|
|
|
162,596 |
|
|
|
157,686 |
|
|
|
168,711 |
|
Charter Aviation |
|
|
14,700 |
|
|
|
22,535 |
|
|
|
23,061 |
|
|
|
20,004 |
|
|
|
17,747 |
|
General Aviation(1) |
|
|
32,823 |
|
|
|
31,678 |
|
|
|
34,240 |
|
|
|
32,211 |
|
|
|
34,078 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
194,885 |
|
|
|
198,001 |
|
|
|
219,897 |
|
|
|
209,901 |
|
|
|
220,536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
General aviation generally consists of small private aircraft. |
36
Cancun International Airport
Cancun International Airport is our most important airport in terms of passenger volume, air
traffic movements and contribution to revenues. In 2006, Cancun International Airport was the
second busiest airport in Mexico in terms of passenger traffic, according to the Mexican Airport
and Auxiliary Services Agency. The airport is located approximately 16 kilometers (ten miles) from
the city of Cancun, which has a population of approximately 519,000. In 2004, 2005 and 2006,
approximately 7.8 million, 7.5 million and 9.7 million passengers, respectively, traveled through
Cancun International Airports main terminal. Of these passengers, in 2004, 2005 and 2006, 77.6%,
78.5%, and 75.1% respectively, were international passengers. A substantial majority of the
airports international passengers (69.4% in 2004, 69.0% in 2005
and 65.9% in 2006) began or ended
their travel in the United States. The airports most important points of origin and destination
are Mexico City, Miami, Houston, Dallas and New York. Due to the airports significant number of
passengers from the United States, its traffic volume and results of operations are substantially
dependent on economic conditions in the United States. See Item 3. Key InformationRisk
FactorsRisks Related to Our OperationsOur business could be adversely affected by a downturn in
the U.S. economy.
During
2006, approximately 100,000 passengers traveled through the charter
terminal (Terminal 1) in
Cancun International Airport. Combined with the 9.6 million passengers that traveled through the
main terminal (Terminal 2), a total of 9.7 million passengers were served by Cancun International
Airport in 2006.
Cancun is located in the state of Quintana Roo. Cancun and its surroundings was the most
visited international tourism destination in Mexico in 2006, according to the Mexican Ministry of
Tourism. According to the Mexican National Trust for Tourist Development, the Cancun area had
approximately 23,824 hotel rooms as of December 31, 2006. Although Cancun may be reached by land,
sea or air, we believe most tourists arrive by air through Cancun International Airport. Cancun is
between approximately one and a half and five hours by air from all major cities in the United
States and 10 to 13 hours by air from most major European cities.
Cancun is located near beaches, coral reefs, ecological parks and Mayan archeological sites.
Cancun International Airport serves travelers visiting the Mayan Riviera, which stretches from
Cancun south to the Mayan ruins at Tulum, and includes coastal hotels and resorts in the towns of
Playa del Carmen, Tulum and Akumal. According to the Mexican National Trust for Tourism
Development, the greater Cancun area (including the Mayan Riviera) was estimated to have an
aggregate of approximately 55,221 hotel rooms as of December 31, 2006.
Since most of the airports passengers are tourists, the airports traffic volume and results
of operations are influenced by the perceived attractiveness of Cancun as a tourist destination.
See Item 3. Key InformationRisk FactorsRisks Related to Our OperationsOur business could be
adversely affected by a downturn in the U.S. economy.
As part of our commercial strategy, in the fourth quarter of 2005 we completed an expansion of
8,224 square meters (approximately 88,621 square feet) and a remodeling of 1,387
37
square meters (approximately 14,445 square feet), giving us a total of 69,584 square meters
(approximately 749,004 square feet) of which 10,147 square meters (109,221 square feet) are for
commercial use in Cancun International Airports main terminal. We are currently pursuing the
eviction of several commercial tenants that occupy a small part of this area. In April 2006, we
obtained a license to develop cargo facilities at the airport, which are currently being operated
by Asur Carga, S.A. de C.V.
Cancun International Airport currently has one runway with a length of 3,500 meters (2.2
miles). Due to a significant increase in passengers at Cancun International Airport, we have
initiated the necessary studies for the construction of a second runway, and have obtained
substantially all the land for the second runway in concession from the Mexican federal government.
However, there can be no assurance that the land obtained will be adequate for building the second
runway. If, for any reason, we are unable to carry out the construction of this second runway, it
could limit the growth of our business and adversely affect our results of operations, future
prospects or financial condition.
The
airports facilities include Terminal 1 (the charter
terminal), Terminal 2 (the main terminal, which includes a wing
referred to as the satellite wing), Terminal 3 (the new terminal
that commenced operations in May 2007 as described below) and a general aviation building that handles private aircraft.
The airport has 33 gates, ten of which are accessible by passenger walkways. The main
terminal has nine gates accessible by passenger walkways, and the charter terminal has one gate
that is accessible by a passenger walkway.
The airports main terminal (including the satellite terminal wing) has a total area of
approximately 49,011 square meters (approximately 527,285 square feet). The charter terminal in
Cancun International Airport, which we acquired on June 30, 1999, has an additional 20,500 square
meters (approximately 220,500 square feet).
On
December 6, 2005, we began construction on Terminal 3, which we opened on May 17,
2007, and which began operations on May 18, 2007. With a total investment of approximately
U.S.$100 million, Terminal 3 constitutes our most ambitious investment project to-date. Terminal 3
will double international passenger capacity at Cancun International Airport. The new building,
measuring a total area of 42,000 square meters (approximately 452,084 square feet), will feature 84
check-in counters and 11 boarding gates with boarding bridges, as well as four gates served by
buses. The terminal will feature state-of-the-art passenger information systems and security
equipment, including the first CT scanning system in Mexico for all checked baggage.
As of December 2004, we charge taxis and passenger vans an access fee of Ps. 15.0, and buses
an access fee of Ps. 25.0, upon entering the airport.
On October 21, 2005, Hurricane Wilma struck the Yucatan Peninsula, causing severe damage to
the infrastructure of the Cancun airport and to our administrative office building in Cancun. The
airports power sources, as well as its control tower and air navigation systems, were knocked out.
Cancun airport closed on October 21 at approximately 6:00 p.m. and reopened on October 24 at
approximately 8:00 a.m. Airport operations did not return to normal for several weeks.
38
In July 2005, we temporarily closed the Cancun
airport for approximately 16 hours as a safety precaution in anticipation of Hurricane Emily.
In October 2004, the Mexican state of Quintana Roo formed a majority state-owned company,
Aeropuerto Internacional de la Riviera Maya, S.A. de C.V., to seek a concession from the Mexican
federal government to build and operate a new airport in the Mayan Riviera region of the state,
which is currently served primarily by Cancun International Airport. The President of Mexico has
publicly announced the intention, at some point in the future, of the Mexican federal government to initiate a public bidding
process to build an airport to service the Mayan Riviera. ASUR has no further details on the
construction or projected opening of the airport and is unable to predict the effect that it may
have on our passenger traffic or operating results if the project is successfully carried out.
In January 2005, Aeropuerto de Cancun, S.A. de C.V. made equity contributions to Aeropuerto de
Huatulco, S.A. de C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Veracruz, S.A. de C.V.,
Aeropuerto de Tapachula, S.A. de C.V. and Aeropuerto de Minatitlan, S.A. de C.V. As a result,
Aeropuerto de Cancun, S.A. de C.V. currently has equity participation
of 24.2%, 18.1%, 8.9%, 30.0%
and 30.0% in these airports, respectively.
Merida International Airport
Merida International Airport serves the inland city of Merida, which has a population of
approximately 920,000, and surrounding areas in the state of Yucatan. Merida International Airport
ranked second among our airports in 2006 in terms of passenger traffic and contribution to
revenues. During 2004, 2005 and 2006, Merida International Airport served 931,127, 1,021,902 and
1,007,210 passengers, respectively, the substantial majority of which were domestic. The airports
primary point of origin and destination is Mexico City.
Merida International Airport attracts a mix of both business travelers and tourists. The city
of Merida is an established urban area with numerous small and medium-sized businesses. The city
is approximately 120 kilometers (75 miles) by highway from Chichen Itza and approximately 80
kilometers (50 miles) from Uxmal, pre-Columbian archeological sites that attract a significant
number of tourists.
The airport has two perpendicular runways, one with a length of 3,200 meters (2.0 miles) and
another with a length of 2,300 meters (1.4 miles). The airport has one main terminal, with four
gates accessible by passenger walkways and six remote boarding positions. As part of our
commercial strategy, we remodeled the entire 7,110 square meter (76,400 square foot) terminal, of
which 962 square meters (approximately 10,350 square feet) are for commercial use. This remodeled
area was opened in December 2001.
In 2004, 2005 and 2006, approximately 19,152, 19,105 and 16,638 metric tons of cargo,
respectively, were transported through Merida International Airport, making it our leading airport
in terms of cargo volume. In 2004, 2005 and 2006, Merida represented approximately 46.6%, 45.1%
and 39.17% respectively, of our total cargo volume. We have considered opportunities for
developing the Merida cargo facilities, but we have no plans to pursue such opportunities at this
time.
39
There is currently one business operating under a long-term lease in Merida International
Airport with Grupo de Desarrollo del Sureste, S.A. de C.V. (GDS), which will terminate on January
1, 2009. This lease allows GDS to construct and develop the airports air cargo terminal. Our
concession provides us the right to collect landing charges and parking charges for aircraft using
the cargo terminal.
In July 2005, we closed our Merida airport for eight hours as a safety precaution in
anticipation of Hurricane Emily.
Cozumel International Airport
Cozumel International Airport is located on the island of Cozumel in the state of Quintana
Roo. The airport primarily serves foreign tourists. During 2004, 2005 and 2006, 584,444, 486,616
and 370,712 passengers, respectively, traveled through Cozumel International Airport, most of which
were international passengers. Cozumel is the most frequently visited destination for cruise ships
in Mexico, hosting approximately 2.5 million and 2.4 million cruise ship visitors in 2005 and 2006,
respectively. Cozumel has one of the worlds largest coral reserves, and many passengers traveling
to Cozumel are divers. The airports most important points of origin and destination are Houston,
Dallas and Cancun. The island of Cozumel has a population of approximately 71,000.
As part of our commercial strategy, at Cozumel International Airports main terminal we
completed an expansion of 2,218 square meters (approximately 23,900 square feet) and a remodeling
of 1,132 square meters (approximately 12,200 square feet) in 2001, giving us a main terminal
building with a total of 7,258 square meters (78,100 square feet) of which 610 square meters (6,600
square feet) are for commercial use.
The airport has a commercial runway with a length of 2,700 meters (1.7 miles). The airport
has one main commercial terminal, with four remote boarding positions. The airport also has a
general aviation building for small private aircraft.
On October 21, 2005, Hurricane Wilma struck the Yucatan Peninsula, causing severe damage to
the infrastructure of the Cozumel airport. The airports power source, as well as its control
tower and air navigation systems, were disrupted. Cozumel airport closed on October 21 at
approximately 3:00 p.m. and reopened on October 23 at approximately 9:00 a.m. Airport operations
did not return to normal for several weeks.
In July 2005, we temporarily closed the Cozumel airport for 21 hours as a result of Hurricane
Emily. In September 2004, we closed Cozumel airport for approximately 36 hours as a safety
precaution in anticipation of hurricane Ivan. Approximately 9 flights were cancelled, and no
recorded damage or passenger injuries resulted.
Villahermosa International Airport
Villahermosa International Airport is located in the state of Tabasco, approximately 75
kilometers (46.9 miles) from Palenque, a Mayan archeological site. The city of Villahermosa has a
population of approximately 658,000. Oil exploration is the principal business activity in the
Villahermosa area, and most of the airports passengers are businesspeople working in the oil
40
industry. During 2004, 2005 and 2006, the airport served 673,313, 717,413 and 725,032
passengers, respectively, substantially all of which arrived on domestic flights. The airports
most important point of origin and destination is Mexico City.
The airport has one runway with a length of 2,200 meters (1.4 miles). The airports main
terminal has six remote parking positions, with three served by boarding bridges.
As
a result of a modernization project carried out in 2006 the airports commercial aviation apron was extended by
a total of 12,521 square meters (134,634.41 square feet), representing an increase of 87%. The
terminal building was expanded from 5,463 square meters (58,741.93 square feet) to 9,678 square
meters (104,064.52 square feet), representing an increase of 77%.
Oaxaca International Airport
Oaxaca International Airport serves the city of Oaxaca, which is the capital of the state of
Oaxaca. The city of Oaxaca, located 390 kilometers (243.8 miles) from the Pacific coast, has a
population of approximately 511,000. The airport served 543,238, 563,656 and 495,623 passengers in
2004, 2005 and 2006, respectively, most of which were domestic. The airports passengers are
primarily Mexican businesspeople and tourists, thus its passenger volume and results of operations
are dependent on Mexican economic conditions. Oaxaca is a picturesque colonial city located near
several tourist attractions, including the archeological ruins of Monte Alban and Mitla. The
airports most important point of origin and destination is Mexico City.
The airport has one runway with a length of 2,450 meters (1.5 miles) and a main terminal
building with five remote positions. The airport also includes a general aviation building for
small private airplanes with 20 positions.
Ongoing public demonstrations in the city of Oaxaca that began as a teachers strike in May
2006 have adversely affected passenger traffic to Oaxaca International Airport. See Risk
FactorsRisks Relating to Mexico.
Veracruz International Airport
Veracruz International Airport is located in the city of Veracruz along the Gulf of Mexico.
The city of Veracruz has a population of approximately 600,000. Veracruz is the busiest port in
Mexico in terms of commercial traffic, and is the location of the countrys largest container
terminal. According to the Mexican Bureau of Ports, Veracruz accounted for 13.85% of all
waterborne cargo handled by Mexican ports in 2006. In 2004, 2005 and 2006, the airport served
563,511, 579,449 and 717,960 passengers, respectively. Because the airports passengers are
primarily Mexican business people, its passenger volume and results of operations are dependent on
Mexican economic conditions. The airports most important point of origin and destination is Mexico
City.
The airport has two perpendicular runways, one with a length of 2,400 meters (1.5 miles) and
another with a length of 1,523 meters (1.0 miles). The airport has one main commercial terminal.
The airport also has a general aviation building for small private aircraft with 23 positions.
41
The original 4,065 square meters (43,700 square feet) of the terminal building at the airport
were remodeled in 2005, and an extension of 2,000 square meters (21,500 square feet) was added,
representing an increase of 49%. In addition, special collapsible jetways were built to protect
passengers during boarding and disembarking, along with a new international baggage reclaim
facility and bigger, newer offices and facilities for federal authorities.
Huatulco International Airport
Huatulco International Airport serves the Huatulco resort area in the state of Oaxaca on
Mexicos Pacific coast. Huatulco has a population of approximately 14,000, and was developed as a
tourist resort in the late 1980s. The airport served 270,757, 312,055 and 375,276 passengers in
2004, 2005 and 2006, respectively, most of which were domestic. The substantial majority of the
airports passengers are international tourists, although many arrive through domestic flights and
are thus classified as domestic. The airports most important points of origin and destination are
Mexico City, Monterrey and Oaxaca.
The airport has one runway with a length of 2,700 meters (1.7 miles). The airports main
terminal has three remote positions. The airport has a general aviation building for small private
airplanes with 8 positions.
Tapachula International Airport
Tapachula International Airport serves the city of Tapachula, which has a population of
approximately 199,000 and is located in the state of Chiapas. In 2004, 2005 and 2006, the airport served
193,573, 192,326 and 188,053passengers, respectively, substantially all of which were domestic.
The airports passenger volume and results of operations are dependent on Mexican economic
conditions since virtually all of its passengers are domestic. The airports most important point
of origin and destination is Mexico City.
The airport has one runway with a length of 2,000 meters (1.3 miles). The airport has one
main terminal with three remote boarding positions. The airport also has a general aviation
building for small private aircraft with 24 boarding positions.
Minatitlan Airport
Minatitlan Airport is located near the Gulf of Mexico, 13 kilometers (8.1 miles) from the city
of Coatzacoalcos, 11 kilometers (6.9 miles) from the city of Cosoleacaque and 26 kilometers (16.2
miles) from the city of Minatitlan. The metropolitan area comprised of these three cities has a
population of approximately 541,000. In 2004, 2005 and 2006, the airport served 126,497, 146,485
and 171,890 passengers, respectively. In recent years, the airports passenger traffic has
decreased due to lower oil and petrochemical industry activity in Coatzacoalcos and Cosoleacaque.
The airports passengers are principally domestic business people drawn by the areas petrochemical
and agriculture businesses. Because the airports passengers are primarily Mexican travelers, its
passenger volume and results of operations are dependent on Mexican economic conditions. The
airports most important point of origin and destination is Mexico City.
42
On August 21, 2006, the Ministry of Communications and Transportation declared Minatitlan
Airport an international airport. As of today, we are exploring the possibility of commencing
international operations there.
The airport has one runway with a length of 2,100 meters (1.3 miles). The airports main
terminal has three remote parking positions. The airport has a general aviation building for small
private airplanes with 30 boarding positions.
Principal Air Traffic Customers
As of December 31, 2006, 104 international airlines and 18 Mexican airlines operated flights
at our nine airports (including airlines operating in the charter terminal in Cancun International
Airport and airlines operating solely on a code share basis). A code share arrangement means that
airlines that do not fly their own aircraft into our airports arrange to share the passenger space
in another airlines aircraft, with both airlines booking passengers through the same code.
Grupo Mexicana, whose subsidiaries include Mexicana and Click Mexicana (formerly known as
Aerocaribe), operates the most flights at our airports, with Grupo Aeromexico providing the second
highest number of flights. Grupo Mexicana is owned by Grupo Posadas, S.A. de C.V., the largest
hotel operator in Mexico, one of whose board members is our Chairman and CEO, Fernando Chico Pardo.
Grupo Aeromexico and Grupo Mexicana also control other airlines operating in our airports,
including Aerocozumel and Aeromexpress, as well as the largest provider of baggage and ramp
handling services at our airports, Servicios de Apoyo en Tierra, or SEAT.
Among foreign airlines, American Airlines and Continental Airlines operate the greatest number
of flights to and from our airports. In 2004, American Airlines and Continental Airlines accounted
for 6.8% and 5.4%, respectively, of our total revenues. In 2005, American Airlines and Continental
Airlines accounted for 6.1% and 5.1%, respectively, of our total revenues. In 2006, American
Airlines and Continental Airlines accounted for 5.8% and 4.7%, respectively, of our revenues.
The following table sets forth our principal air traffic customers based on the percentage of
revenues they represented for the years ended December 31, 2004, 2005 and 2006:
Principal Air Traffic Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of ASUR Revenues |
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
Customer |
|
|
|
|
|
|
|
|
|
|
|
|
Compania Mexicana de Aviacion, S.A. de C.V.
(Mexicana) |
|
|
9.6 |
% |
|
|
10.4 |
% |
|
|
9.1 |
% |
American Airlines |
|
|
6.8 |
% |
|
|
6.1 |
% |
|
|
5.8 |
% |
Aerovias de Mexico, S.A. de C.V. (Aeromexico) |
|
|
6.2 |
% |
|
|
5.1 |
% |
|
|
5.9 |
% |
Continental Airlines |
|
|
5.4 |
% |
|
|
5.1 |
% |
|
|
4.7 |
% |
Aerovias Caribe, S.A. de C.V. (Click) |
|
|
3.3 |
% |
|
|
3.3 |
% |
|
|
3.5 |
% |
Aviation Support S.A. de C.V. |
|
|
2.0 |
% |
|
|
2.2 |
% |
|
|
2.9 |
% |
Aviacion Comercial Especializada S.A. de C.V. |
|
|
4.0 |
% |
|
|
3.8 |
% |
|
|
3.0 |
% |
Comercializadora de Productos en Aeropuertos |
|
|
0 |
% |
|
|
0.3 |
% |
|
|
0.0 |
% |
Consorcio Aviacsa, S.A. de C.V. |
|
|
3.6 |
% |
|
|
4.3 |
% |
|
|
4.2 |
% |
American Trans Air |
|
|
1.3 |
% |
|
|
1.1 |
% |
|
|
0.0 |
% |
Petroservicios de Mexico, S.A. de C.V. |
|
|
2.5 |
% |
|
|
2.1 |
% |
|
|
0.5 |
% |
Other |
|
|
55.3 |
% |
|
|
56.2 |
% |
|
|
60.4 |
% |
Total |
|
|
100.0 |
% |
|
|
100 |
% |
|
|
100. |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
43
Seasonality
Our business is subject to seasonal fluctuations. In general, demand for air travel is
typically higher during the summer months and during the winter holiday season, particularly in
international markets, because there is more vacation travel during these periods. Our results of
operations generally reflect this seasonality, but have also been impacted by numerous other
factors that are not necessarily seasonal, including economic conditions, war or threat of war,
weather, air traffic control delays and general economic conditions, as well as the other factors
discussed above. As a result, our operating results for a quarterly period are not necessarily
indicative of operating results for an entire year, and historical operating results are not
necessarily indicative of future operating results.
Competition
Since our business is substantially dependent on international tourists, our principal
competition is from competing tourist destinations. We believe that the main competitors to Cancun
are vacation destinations in Mexico, such as Acapulco, Puerto Vallarta and Los Cabos, and elsewhere
such as Puerto Rico, Florida, Cuba, Jamaica, the Dominican Republic and other Caribbean island and
Central American resorts. In March 2000, a new airport opened in Chichen Itza. This airport is
operated by the former operator of the charter terminal in Cancun Airport. In addition, the
Mexican government has announced its intention, at some point in the future, to grant a concession for a new airport in the Mayan
Riviera through a public bidding process. In October 2004, the Mexican state of Quintana Roo
formed a majority state-owned company, Aeropuerto Internacional de la Riviera Maya, S.A. de C.V.,
to seek any such concession that may be granted. Currently, the Mayan Riviera is served primarily
by Cancun Airport. ASUR has no further details on the construction or projected opening of the
airport and is unable to predict the effect that it may have on our passenger traffic or operating
results if the project is successfully carried out.
The relative attractiveness of the locations we serve is dependent on many factors, some of
which are beyond our control. These factors include promotional activities and pricing policies of
hotel and resort operators, weather conditions, natural disasters (such as hurricanes) and the
development of new resorts that may be considered more attractive. There can be no assurance that
the locations we serve will continue to attract the same level of passenger traffic in the future.
Excluding Cancun Airport, our airports generally do not face significant competition. The
Mexican Airport and Auxiliary Services Agency currently operates seven small airports in Mexicos
southeast region. The Mexican Airport and Auxiliary Services Agency estimates that its airports
collectively account for less than 10% of the passenger traffic in the region.
44
REGULATORY FRAMEWORK
Sources of Regulation
The following are the principal laws, regulations and instruments that govern our business and
the operation of our airports:
|
|
the Mexican Airport Law, enacted December 22, 1995, |
|
|
|
the regulations to the Mexican Airport Law, enacted February 17, 2000, |
|
|
|
the Mexican Communications Law, enacted February 19, 1940, |
|
|
|
the Mexican Civil Aviation Law, enacted May 12, 1995, |
|
|
|
the Mexican Federal Duties Law, enacted December 31, 1981, |
|
|
|
the Mexican National Assets Law, enacted May 20, 2004, and |
|
|
|
the concessions that entitle our subsidiaries to operate our nine airports, which were granted in 1998 and
amended in 1999. |
The Mexican Airport Law and the regulations to the Mexican Airport Law establish the general
framework regulating the construction, operation, maintenance and development of Mexican airport
facilities. The Mexican Airport Laws stated intent is to promote the expansion, development and
modernization of Mexicos airport infrastructure by encouraging investment and competition.
Under the Mexican Airport Law, a concession granted by the Ministry of Communications and
Transportation is required to construct, operate, maintain or develop a public service airport in
Mexico. A concession generally must be granted pursuant to a public bidding process, except for:
(i) concessions granted to (a) entities considered part of the federal public administration as
defined under Mexican law and (b) private companies whose principal stockholder may be a state or
municipal government; (ii) concessions granted to operators of private airports (who have operated
privately for five or more years) wishing to begin operating their facilities as public service
airports; and (iii) complementary concessions granted to existing concession holders.
Complementary concessions may be granted only under certain limited circumstances, such as where an
existing concession holder can demonstrate, among other things, that the award of the complementary
concession is necessary to satisfy passenger demand. In 1998, the Ministry of Communications and
Transportation granted nine concessions to operate, maintain and develop the nine principal
airports in Mexicos southeast region to our subsidiaries. Because our subsidiaries were
considered entities of the federal public administration at the time the concessions were granted,
the concessions were awarded without a public bidding process. Each of our concessions was amended
on March 19, 1999 in order, among other things, to incorporate each airports maximum rates and
certain other terms as part of the concession.
45
The Mexican National Assets Law among other items establishes regulations relating to
concessions on real property held in the public domain, including the airports that we operate. The
Mexican National Assets Law requires concessionaires of real property held in the public domain
that are used for administrative or other non-public purposes to pay a tax. In addition, the
Mexican National Assets Law establishes grounds for revocation of concessions for failure to pay
this tax.
To
our knowledge, the constitutionality of the Mexican National Assets Law has not been challenged in Mexicos
court system. If challenged in the future, a court could declare the tax void or determine an
alternate amount. We do not expect this tax to materially affect our results of operations or
financial condition.
On February 17, 2000 the regulations to the Mexican Airport Law were issued. Although we
believe we are currently complying with the principal requirements of the Mexican Airport Law and
its regulations, we are not in compliance with certain requirements under the regulations. These
violations could result in fines or other sanctions being assessed by the Ministry of
Communications and Transportation, and are among the violations that could result in termination of
a concession if they occur three or more times.
Role of the Ministry of Communications and Transportation
The Ministry of Communications and Transportation is the principal regulator of airports in
Mexico and is authorized by the Mexican Airport Law to perform the following functions:
|
|
grant, modify and revoke concessions for the operation of airports, |
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|
|
establish air transit rules and rules regulating take-off and landing schedules through the Mexican air
traffic control authority, |
|
|
|
take all necessary action to create an efficient, competitive and non-discriminatory market for
airport-related services, |
|
|
|
approve any transaction or transactions that directly or indirectly may result in a change of control of a
concession holder, |
|
|
|
approve the master development plans prepared by each concession holder every five years, |
|
|
|
determine each airports maximum rates, |
|
|
|
approve any agreements entered into between a concession holder and a third party providing airport or
complementary services at its airport, |
|
|
|
establish safety regulations, |
|
|
|
monitor airport facilities to determine their compliance with the Mexican Airport Law, other applicable
laws and the terms of the concessions, and |
46
|
|
impose penalties for failure to observe and perform the rules under the Mexican Airport Law, the Mexican
Airport Law regulations and the concessions. |
In addition, under the Mexican Organic Law of the Federal Public Administration, the Mexican
Airport Law and the Mexican Civil Aviation Law, the Ministry of Communications and Transportation
is required to provide air traffic control, radio assistance and aeronautical communications at
Mexicos airports. The Ministry of Communications and Transportation provides these services
through SENEAM, the Mexican air traffic control authority, which is a division of the Ministry of
Communications and Transportation. Since 1978, the Mexican air traffic control authority has
provided air traffic control for Mexicos airports.
New Regulatory Agency
The Ministry of Communications and Transportation has announced that it intends to establish a
new regulatory agency. This new agency is expected to be authorized to monitor our activities and
those of the other new airport groups, to enforce applicable regulations and to propose amendments
to concessions, to set maximum rates, to resolve disputes between concession holders and airport
users (such as airlines) and to collect and distribute information relating to the airport sector.
No date for the establishment of this new regulatory agency has been publicly announced.
Scope of Concessions and General Obligations of Concession Holders
As authorized under the Mexican Airport Law, each of the concessions held by our subsidiaries
is for an initial 50-year term from November 1, 1998. This initial term of each of our concessions
may be renewed in one or more terms for up to an additional 50 years, subject to the concession
holders acceptance of any new conditions imposed by the Ministry of Communications and
Transportation and to its compliance with the terms of its concession.
The concessions held by our subsidiary concession holders allow the relevant concession
holder, during the term of the concession, to: (i) operate, maintain and develop its airport and
carry out any necessary construction in order to render airport, complementary and commercial
services as provided under the Mexican Airport Law and the Mexican Airport Law regulations; and
(ii) use and develop the assets that comprise the airport that is the subject of the concession
(consisting of the airports real estate and improvements but excluding assets used in connection
with fuel supply and storage). These assets are government-owned assets, subject to the Mexican
National Assets Law. Upon expiration of a concession, these assets automatically revert to the
Mexican government.
Substantially all of contracts entered into by the Mexican Airport and Auxiliary Services
Agency with respect to each of our airports have been assigned to the relevant concession holder
for each airport. As part of this assignment, each concession holder agreed to indemnify the
Mexican Airport and Auxiliary Services Agency for any loss suffered by the Mexican Airport and
Auxiliary Services Agency due to the concession holders breach of its obligations under an
assigned agreement.
Under the Mexican Federal Duties Law, each of our subsidiary concession holders is required to
pay the Mexican government a concession fee based on its gross annual revenues
47
from the use of public domain assets pursuant to the terms of its concession. Currently, this
concession fee is set at a rate of 5% and may be revised annually by the Mexican Congress. Our
concessions provide that we may request an amendment of our maximum rates if there is a change in
this concession fee.
Concession holders are required to provide airport security. If public order or national
security is endangered, the competent federal authorities are authorized to act to protect the
safety of aircraft, passengers, cargo, mail, installations and equipment.
Each concession holder and any third party providing services at an airport is required to
carry specified insurance in amounts and covering specified risks, such as damage to persons and
property at the airport, in each case as specified by the Ministry of Communications and
Transportation. To date the Ministry of Communications and Transportation has not specified the
required amounts of insurance. We cannot assure you that we will not be required to obtain
additional insurance once these amounts are specified.
ASUR and our subsidiary concession holders are jointly and severally liable to the Ministry of
Communications and Transportation for the performance of all obligations under the concessions held
by our subsidiaries. Each of our subsidiary concession holders is responsible for the performance
of the obligations set forth in its concession, including the obligations arising from third-party
contracts, as well as for any damages to the Mexican government-owned assets which they use and to
third-party airport users. In the event of a breach of one concession, the Ministry of
Communications and Transportation is authorized to revoke all of the concessions held by our
subsidiaries.
The shares of a concession holder and the rights under a concession may be subject to a lien
only with the approval of the Ministry of Communications and Transportation. No agreement
documenting liens approved by the Ministry of Communications and Transportation may allow the
beneficiary of a pledge to become a concession holder under any circumstances.
A concession holder may not assign any of its rights or obligations under its concession
without the authorization of the Ministry of Communications and Transportation. The Ministry of
Communications and Transportation is authorized to consent to an assignment only if the proposed
assignee satisfies the requirements to be a concession holder under the Mexican Airport Law,
undertakes to comply with the obligations under the relevant concession and agrees to any other
conditions that the Ministry may require.
Classification of Services Provided at Airports
The Mexican Airport Law and the Mexican Airport Law regulations classify the services that may
be rendered at an airport into the following three categories:
|
|
Airport Services. Airport services may be rendered only by the holder of a
concession or a third party that has entered into an agreement with the concession holder to
provide such services. These services include: the use of airport runways, taxiways and
aprons for landing, aircraft parking and departure, the use of hangars, passenger walkways,
transport buses and automobile parking facilities, the provision of airport security
services, rescue and firefighting services, ground traffic control, lighting and visual aids,
the general use of |
48
|
|
terminal space and other infrastructure by aircraft, passengers and cargo, and
the provision of access to an airport to third parties providing complementary
services (as defined in the Mexican Airport Law) and third parties providing
permanent ground transport services (such as taxis). |
|
|
|
Complementary Services. Complementary services
may be rendered by an airline, by the airport
operator or by a third party under agreements with
airlines or the airport operator. These services
include: ramp and handling services, passenger
check-in, and aircraft security, catering, cleaning,
maintenance, repair and fuel supply and related
activities that provide support to air carriers. |
|
|
|
Commercial Services. Commercial services
involve services that are not considered essential to
the operation of an airport or aircraft, and include:
the leasing of space to retailers, restaurants and
banks, and advertising. |
Third parties rendering airport, complementary or commercial services are required to do so
pursuant to a written agreement with the relevant concession holder. All agreements relating to
airport or complementary services are required to be approved by the Ministry of Communications and
Transportation. The Mexican Airport Law provides that the concession holder is jointly liable with
these third parties for compliance with the terms of the relevant concession with respect to the
services provided by such third parties. All third-party service providers of complementary
services are required to be corporations incorporated under Mexican law.
Airport and complementary services are required to be provided to all users in a uniform and
regular manner, without discrimination as to quality, access or price. Concession holders are
required to provide airport and complementary services on a priority basis to military aircraft,
disaster support aircraft and aircraft experiencing emergencies. Airport and complementary
services are required to be provided at no cost to military aircraft and aircraft performing
national security activities.
In the event of force majeure, the Ministry of Communications and Transportation may impose
additional regulations governing the provision of services at airports, but only to the extent
necessary to address the force majeure event. The Mexican Airport Law allows the airport
administrator appointed by a concession holder to suspend the provision of airport services in the
event of force majeure.
A concession holder is also required to take all necessary measures to create a competitive
market for complementary services. Due to space, efficiency and safety considerations, a
concession holder may limit the number of providers of complementary services in its airport. If
the number of complementary service providers must be limited due to these considerations,
contracts for the provision of complementary services must be awarded through a competitive bidding
process.
49
Master Development Plans
Concession holders are also required to submit to the Ministry of Communications and
Transportation a master development plan describing, among other things, the concession holders
construction and maintenance plans.
Each master development plan is for a fifteen-year period and is required to be updated every
five years and resubmitted for approval to the Ministry of Communications and Transportation. Upon
such approval, the master development plan is deemed to constitute a part of the relevant
concession. Any major construction, renovation or expansion of an airport may only be made
pursuant to a concession holders master development plan or upon approval by the Ministry of
Communications and Transportation. Information required to be presented in the master development
plan includes:
|
|
airport growth and development expectancies, |
|
|
|
15-year projections for air traffic demand (including passenger, cargo and operations), |
|
|
|
construction, conservation, maintenance, expansion and modernization programs for infrastructure,
facilities and equipment, |
|
|
|
five-year detailed investment program and planned major investments for the following ten years, |
|
|
|
probable sources of financing, |
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|
|
descriptive airport plans, and |
|
|
|
environmental protection measures. |
The concessions require the concession holder to engage recognized independent consultants to
conduct polls among airport users with respect to current and expected quality standards, and to
prepare air traffic projections and investment requirements. The concession holder must submit a
draft of the master development plan to airport users for their review and comments. Further, the
concession holder must submit the master development plan to the Ministry of Communications and
Transportation prior to the expiration of the five-year term. The Ministry of Communications and
Transportation may request additional information or clarification as well as seek further comments
from airport users.
Changes to a master development plan and investment program require the approval of the
Ministry of Communications and Transportation, except for emergency repairs and minor works that do
not adversely affect an airports operations.
On December 30, 2003, the Ministry of Communications and Transportation approved our current
master development plans. The current terms of the updated master development plans went into
effect on January 1, 2004, and will be in effect until December 31, 2008.
50
The following table sets forth our committed investments for each airport pursuant to the
terms of our current master development plans for the periods presented. Even though we have
committed to invest the amounts in the table, those amounts could be lower or higher depending on
the cost of each project.
Committed Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
2007 |
|
|
2008 |
|
|
Total |
|
|
|
(thousands of pesos)(1) |
|
Cancun(2) |
|
Ps. |
334,960 |
|
|
Ps. |
432,206 |
|
|
Ps. |
847,797 |
|
|
Ps. |
1,052,919 |
|
|
Ps. |
83,298 |
|
|
Ps. |
2,751,180 |
|
Merida |
|
|
25,184 |
|
|
|
27,710 |
|
|
|
46,255 |
|
|
|
31,188 |
|
|
|
2,321 |
|
|
|
132,658 |
|
Cozumel |
|
|
10,598 |
|
|
|
68,984 |
|
|
|
12,442 |
|
|
|
16,280 |
|
|
|
10,828 |
|
|
|
119,132 |
|
Villahermosa |
|
|
47,407 |
|
|
|
63,602 |
|
|
|
6,360 |
|
|
|
11,892 |
|
|
|
1,303 |
|
|
|
130,564 |
|
Oaxaca |
|
|
21,502 |
|
|
|
21,150 |
|
|
|
10,257 |
|
|
|
6,624 |
|
|
|
4,829 |
|
|
|
64,362 |
|
Veracruz |
|
|
25,161 |
|
|
|
21,287 |
|
|
|
11,616 |
|
|
|
11,205 |
|
|
|
1,496 |
|
|
|
70,765 |
|
Huatulco |
|
|
9,820 |
|
|
|
5,450 |
|
|
|
3,990 |
|
|
|
6,816 |
|
|
|
52,560 |
|
|
|
78,636 |
|
Tapachula |
|
|
20,202 |
|
|
|
4,447 |
|
|
|
9,217 |
|
|
|
8,158 |
|
|
|
801 |
|
|
|
42,825 |
|
Minatitlan |
|
|
10,559 |
|
|
|
6,156 |
|
|
|
4,838 |
|
|
|
2,023 |
|
|
|
3,062 |
|
|
|
26,638 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
505,393 |
|
|
Ps. |
650,992 |
|
|
Ps. |
952,772 |
|
|
Ps. |
1,147,105 |
|
|
Ps. |
160,498 |
|
|
Ps. |
3,416,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Expressed in constant pesos with purchasing power as of December 31, 2006 based on the
Mexican construction price index in accordance with the terms of our master development plan. |
|
(2) |
|
The master development plan for Cancun airport was modified in the fourth quarter of 2005 to
reflect our decision to build a new terminal rather than implement extensive expansion and
remodeling of existing terminals, and to reflect an accelerated timetable for the construction
of a second runway once the necessary land is received from the government. The Ministry of
Communications and Transportation approved the modified plan and recognized Ps. 1,433 million
in investments as of December 31, 2006. |
Price Regulation
The Mexican Airport Law provides that the Ministry of Communications and Transportation may
establish price regulations for services for which the Antitrust Commission determines that a
competitive market does not exist. On March 9, 1999, the Antitrust Commission issued a ruling
stating that competitive markets generally do not exist for airport services and airport access
provided to third parties rendering complementary services. This ruling authorized the Ministry of
Communications and Transportation to establish regulations governing the prices that may be charged
for airport services and access fees that may be charged to providers of complementary services in
our airports. On March 19, 1999, a new regulation, the Rate Regulation, was incorporated within
the terms of each of our concessions. The Rate Regulation, which became effective May 1, 1999,
establishes the annual maximum rates for each of our concession holders, which is the maximum
amount of revenue per work load unit (one passenger or 100 kilograms (220 pounds) of cargo) in a
given year that the concession holder may earn at its airports from all regulated revenue sources.
Regulated Revenues
The Rate Regulation establishes a dual-till system of price regulation under which certain
of our revenues, such as passenger charges, landing charges, aircraft parking charges and access
fees from third parties providing complementary services at our airports, are regulated, while the
revenues that we earn from commercial activities in our terminals, such as the leasing of space to
duty-free stores, retailers, restaurants, car rental companies and banks, are not regulated.
51
The Rate Regulation provides that the following sources of revenues are regulated under this
dual-till system:
|
|
revenues from airport services (as defined under the
Mexican Airport Law), other than automobile parking, and |
|
|
|
access fees earned from third parties providing
complementary services, other than those related to the
establishment of administrative quarters that the Ministry
of Communications and Transportation determines to be
non-essential. |
All other sources of revenues at our airports are not regulated. Approximately 78.8%, 74.6%
and 74.7% of our revenues in 2004, 2005 and 2006, respectively, were derived from regulated sources
of revenue.
Each concession holder is entitled to determine the prices charged for each regulated service
and is required to register such prices with the Ministry of Communications and Transportation.
Once registered, those prices are deemed part of its concession, and may only be changed every six
months or earlier if there has been a cumulative increase of at least 5% in the Mexican producer
price index (excluding petroleum) as published by the Mexican Central Bank since the date of the
last adjustment and in other specific circumstances. See Special Adjustments to Maximum Rates.
Current Maximum Rates
Each airports maximum rates from January 1, 2004 to December 31, 2008 were set by the
Ministry of Communications and Transportation in December 2003.
The following table sets forth the maximum rates for each of our airports for the periods
indicated. These maximum rates are subject to adjustment only under the limited circumstances
described below under Special Adjustments to Maximum Rates.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum Rates(1)(2) |
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
2007 |
|
2008 |
Cancun |
|
Ps. |
125.34 |
|
|
Ps. |
124.40 |
|
|
Ps |
123.46 |
|
|
Ps. |
122.53 |
|
|
Ps. |
121.61 |
|
Merida |
|
|
94.46 |
|
|
|
93.75 |
|
|
|
93.05 |
|
|
|
92.36 |
|
|
|
91.67 |
|
Cozumel |
|
|
134.48 |
|
|
|
133.47 |
|
|
|
132.46 |
|
|
|
131.47 |
|
|
|
130.49 |
|
Villahermosa |
|
|
109.44 |
|
|
|
108.60 |
|
|
|
107.80 |
|
|
|
106.99 |
|
|
|
106.19 |
|
Oaxaca |
|
|
115.39 |
|
|
|
114.51 |
|
|
|
113.65 |
|
|
|
112.80 |
|
|
|
111.96 |
|
Veracruz |
|
|
98.01 |
|
|
|
97.27 |
|
|
|
96.53 |
|
|
|
95.82 |
|
|
|
95.09 |
|
Huatulco |
|
|
110.85 |
|
|
|
110.03 |
|
|
|
96.61 |
|
|
|
108.38 |
|
|
|
107.57 |
|
Tapachula |
|
|
137.85 |
|
|
|
136.82 |
|
|
|
135.80 |
|
|
|
134.78 |
|
|
|
133.77 |
|
Minatitlan |
|
|
117.49 |
|
|
|
116.62 |
|
|
|
115.74 |
|
|
|
114.87 |
|
|
|
114.01 |
|
|
|
|
(1) |
|
Expressed in adjusted pesos as of December 31, 2006 based on the Mexican producer price index
(excluding petroleum). |
|
(2) |
|
Our concessions provide that each airports maximum rate may be adjusted annually to take
account of projected improvements in efficiency. For the five-year period ending December 31,
2008, the maximum rates applicable to our airports reflect a projected annual efficiency
improvement of 0.75%. |
52
Methodology For Determining Future Maximum Rates
The Rate Regulation provides that each airports annual maximum rates are to be determined in
five-year intervals based on the following variables:
|
|
Projections for the fifteen-year period of work load
units (each of which is equivalent to one passenger or 100
kilograms (220 pounds) of cargo), operating costs and
expenses (excluding amortization and depreciation) related
to services subject to price regulation. |
|
|
|
Projections for the fifteen-year period of capital
expenditures related to regulated services, based on air
traffic forecasts and quality of standards for services to
be derived from the master development plans. |
|
|
|
Reference values, which were established in the
concessions and are designed to reflect the net present
value of the regulated revenues minus the corresponding
regulated operating costs and expenses (excluding
amortization and depreciation), and capital expenditures
related to the provision of regulated services plus a
terminal value. |
|
|
|
A discount rate to be determined by the Ministry of
Communications and Transportation. The concessions provide
that the discount rate shall reflect the cost of capital to
Mexican and international companies in the airport industry
(on a pre-tax basis), as well as Mexican economic
conditions. The concessions provide that the discount rate
shall be at least equal to the average yield of long-term
Mexican government debt securities quoted in the
international markets during the prior 24 months plus a
risk premium to be determined by the Ministry of
Communications and Transportation based on the inherent
risk of the airport business in Mexico. |
Our concessions specify a discounted cash flow formula to be used to determine the maximum
rates that, given the projected pre-tax earnings, capital expenditures and discount rate, would
result in a net present value equal to the reference values established in connection with the last
determination of maximum rates.
Our concessions provide that each airports maximum rate may be adjusted annually to take
account of projected improvements in efficiency. For the five-year period ending December 31,
2008, the maximum rates applicable to our airports reflect a projected annual efficiency
improvement of 0.75%.
The concessions provide that each airports reference values, discount rate and the other
variables used in calculating the maximum rates are not guarantees and do not in any manner
represent an undertaking by the Ministry of Communications and Transportation or the Mexican
government as to the performance of any concession holder. To the extent that the revenues from
services subject to price regulation in any period are less than an airports maximum rate
multiplied by the work load units processed for such period, no adjustment will be made to
compensate for this shortfall.
To the extent that such aggregate revenues per work load unit exceed the relevant maximum
rate, the Ministry of Communications and Transportation may proportionately reduce the maximum rate
in the immediately subsequent year and assess penalties equivalent to 1,000 to
53
50,000 times the general minimum wage in the Federal District (Mexico City). On January 1,
2007, the daily minimum wage in Mexico City was Ps. 50.57. As a result, the maximum penalty at
such date could have been Ps. 2.5 million (U.S.$233,869). In the event that a concession holder
fails to comply with certain terms of its concession, or violates certain other terms of its
concession after having been sanctioned at least three times for violation of that concession, the
Ministry of Communications and Transportation is entitled to revoke its concession. We would face
similar sanctions for any violations of the Mexican Airport Law or its regulations. A full
discussion of circumstances that might lead to a revocation of a concession may be found below at
Penalties and Termination and Revocation of Concessions and Concession Assets.
Currently, our calculation of work load units (one passenger or 100 kilograms (220 pounds) of
cargo does not include transit passengers. There is a possibility that in the future our work load
units may include transit passengers and the Ministry of Communications and Transportation will
decrease our maximum rates to reflect this higher passenger base. Although there can be no
assurance, we do not expect this change to occur in the short term or have a material adverse
effect on our revenues if and when it happens.
Special Adjustments to Maximum Rates
Once determined, each airports maximum rates are subject to special adjustment only under the
following circumstances:
|
|
Change in law or natural disasters. A concession
holder may request an adjustment in its maximum rates if a
change in law with respect to quality standards or safety
and environmental protection results in operating costs or
capital expenditures that were not contemplated when its
maximum rates were determined. In addition, a concession
holder may also request an adjustment in its maximum rates
if a natural disaster affects demand or requires
unanticipated capital expenditures. There can be no
assurance that any request on these grounds would be
approved, or that we would make such a request. |
|
|
|
Macroeconomic conditions. A concession holder may
also request an adjustment in its maximum rates if, as a
result of a decrease of at least 5% in Mexican gross
domestic product in a 12-month period, the work load units
processed in the concession holders airport are less than
that projected when its maximum rates were determined. To
grant an adjustment under these circumstances, the Ministry
of Communications and Transportation must have already
allowed the concession holder to decrease its projected
capital improvements as a result of the decline in
passenger traffic volume. There can be no assurance that
any request on these grounds would be approved, or that we
would make such a request. |
|
|
|
Increase in concession fee under Mexican Federal
Duties Law. An increase in duty payable by a concession
holder under the Mexican Federal Duties Law entitles the
concession holder to request an adjustment in its maximum
rates. There can be no assurance that any request on these
grounds would be approved. |
|
|
|
Failure to make required investments or improvements.
The Ministry of Communications and Transportation annually
is required to review each concession holders compliance
with its master development plan (including the provision
of services and the making of capital
|
54
|
|
investments). If a concession holder fails to satisfy any of the investment
commitments contained in its master development plan, the Ministry of
Communications and Transportation is entitled to decrease the concession
holders maximum rates and assess penalties. |
|
|
|
Excess revenues. In the event that revenues
subject to price regulation per work load unit in any
year exceed the applicable maximum rate, the maximum
rate for the following year will be decreased to
compensate airport users for overpayment in the
previous year. Under these circumstances, the
Ministry of Communications and Transportation is also
entitled to assess penalties against the concession
holder. |
Ownership Commitments and Restrictions
The concessions require us to retain a 51% direct ownership interest in each of our nine
concession holders throughout the term of these concessions. Any acquisition by us or one of our
concession holders of any additional airport concessions or of a beneficial interest of 30% or more
of another concession holder requires the consent of the Antitrust Commission. In addition, the
concessions prohibit us and our concession holders, collectively or individually, from acquiring
more than one concession for the operation of an airport along each of Mexicos southern and
northern borders.
Air carriers are prohibited under the Mexican Airport Law from controlling or beneficially
owning 5% or more of the shares of a holder of an airport concession. We, and each of our
subsidiaries, are similarly restricted from owning 5% or more of the shares of any air carrier.
Foreign governments acting in a sovereign capacity are prohibited from owning any direct or
indirect equity interest in a holder of an airport concession.
Reporting, Information and Consent Requirements
Concession holders and third parties providing services at airports are required to provide
the Ministry of Communications and Transportation access to all airport facilities and information
relating to an airports construction, operation, maintenance and development. Each concession
holder is obligated to maintain statistical records of operations and air traffic movements in its
airport and to provide the Ministry of Communications and Transportation with any information that
it may request. Each concession holder is also required to publish its annual audited consolidated
financial statements in a principal Mexican newspaper within the first four months of each year.
The Mexican Airport Law provides that any person or group directly or indirectly acquiring
control of a concession holder is required to obtain the consent of the Ministry of Communications
and Transportation to such control acquisition. For purposes of this requirement, control is
deemed to be acquired in the following circumstances:
|
|
if a person acquires 35% or more of the shares of a concession holder,
|
55
|
|
if a person has the ability to control the outcome of meetings of the stockholders of a concession holder, |
|
|
|
if a person has the ability to appoint a majority of the members of the board of directors of a concession
holder, and |
|
|
|
if a person by any other means acquires control of an airport. |
Under the regulations to the Mexican Airport Law, any company acquiring control of a
concession holder is deemed to be jointly and severally liable with the concession holder for the
performance of the terms and conditions of the concession.
The Ministry of Communications and Transportation is required to be notified upon any change
in a concession holders chief executive officer, board of directors or management. A concession
holder is also required to notify the Ministry of Communications and Transportation at least 90
days prior to the adoption of any amendment to its bylaws concerning the dissolution, corporate
purpose, merger, transformation or spin-off of the concession holder.
Penalties and Termination and Revocation of Concessions and Concession Assets
The Mexican Airport Law provides that sanctions of up to 400,000 times the minimum daily wage
in the Federal District (Mexico City) may be assessed for failures to comply with the terms of a
concession. On January 1, 2007, the daily minimum wage in Mexico City was Ps. 50.57. As a result,
the maximum penalty at such date could have been Ps. 20.2 million (U.S.$1.87 million).
Under the Mexican Airport Law and the terms of the concessions, a concession may be terminated
upon any of the following events:
|
|
expiration of its term, |
|
|
|
surrender by the concession holder, |
|
|
|
revocation of the concession by the Ministry of Communications and Transportation, |
|
|
|
reversion (rescate) of the Mexican government-owned assets that are the subject of the concession
(principally real estate, improvements and other infrastructure), |
|
|
|
inability to achieve the purpose of the concession, except in the event of force majeure, or |
|
|
|
dissolution, liquidation or bankruptcy of the concession holder. |
The Mexican National Assets Law, published in the Diario Oficial de la Federacion on May 20,
2004, among other items, establishes regulations relating to concessions on real
56
property held in the public domain, including the airports that we operate. The Mexican
National Assets Law requires concessionaires of real property held in the public domain that are
used for administrative or other non-public purposes to pay a tax. In addition, the Mexican
National Assets Law establishes new grounds for revocation of concessions for failure to pay this
tax.
A concessions termination does not exempt the concession holder from liability in connection
with the obligations acquired during the term of the concession.
Upon termination, whether as a result of expiration or revocation, the public domain assets
(including real estate and fixtures) that were the subject of the concession automatically revert
to the Mexican government at no cost. In addition, upon termination the Mexican federal government
has a preemptive right to acquire privately owned assets used by the concession holder to provide
services under the concession at prices determined by expert appraisers appointed by the Ministry
of Communications and Transportation. Alternatively, the Mexican government may elect to lease
these assets for up to five years at fair market rates as determined by expert appraisers appointed
by the Mexican government and the concession holder. In the event of a discrepancy between
appraisals, a third expert appraiser must be jointly appointed by the Mexican government and the
concession holder. If the concession holder does not appoint an expert appraiser, or if such
appraiser fails to determine a price, the determination of the appraiser appointed by the Mexican
government will be conclusive. If the Mexican government chooses to lease the assets, it may
thereafter purchase the assets at their fair market value, as determined by an expert appraiser
jointly appointed by the Mexican government and the concession holder.
A concession may be revoked by the Ministry of Communications and Transportation under certain
conditions, including:
|
|
the failure by a concession holder to begin operating,
maintaining and developing an airport pursuant to the terms
established in the concession, |
|
|
|
the failure by a concession holder to maintain
insurance as required under the Mexican Airport Law, |
|
|
|
the assignment, encumbrance, transfer or sale of a
concession, any of the rights thereunder or the assets
underlying the concession in violation of the Mexican
Airport Law, |
|
|
|
any alteration of the nature or condition of an
airports facilities without the authorization of the
Ministry of Communications and Transportation, |
|
|
|
consent to the use, or without the approval of air
traffic control authorities, of an airport by any aircraft
that does not comply with the requirements of the Mexican
Civil Aviation Law, that has not been authorized by the
Mexican air traffic control authority, or that is involved
in the commission of a felony, |
|
|
|
knowingly appointing or maintaining a chief executive
officer or board member of a concession holder that is not
qualified to perform his functions under the law as a
result of having violated criminal laws,
|
57
|
|
a violation of the safety regulations established in
the Mexican Airport Law and other applicable laws, |
|
|
|
a total or partial interruption of the operation of an
airport or its airport or complementary services without
justified cause, |
|
|
|
the failure of ASUR to own at least 51% of the capital
stock of its subsidiary concession holders, |
|
|
|
the failure to maintain the airports facilities, |
|
|
|
the provision of unauthorized services, |
|
|
|
the failure to indemnify a third party for damages
caused by the provision of services by the concession
holder or a third-party service provider, |
|
|
|
charging prices higher than those registered with the
Ministry of Communications and Transportation for regulated
services or exceeding the applicable maximum rate, |
|
|
|
any act or omission that impedes the ability of other
service providers or authorities to carry out their
functions within the airport, or |
|
|
|
any other failure to comply with the Mexican Airport
Law, its regulations and the terms of a concession. |
The Ministry of Communications and Transportation is entitled to revoke a concession without
prior notice as a result of the first six events described above. In the case of other violations,
a concession may be revoked as a result of a violation only if sanctions have been imposed at least
three times with respect to the same violation.
According to the Mexican National Assets Law, Mexicos national patrimony consists of private
and government-owned assets of the Federation. The surface area of our airports and improvements
on such space are considered government-owned assets. A concession concerning government-owned
assets may be reverted to the Mexican government prior to the concessions expiration, when
considered necessary for the public interest. In exchange, the Mexican government is required to
pay compensation, taking into consideration investments made and depreciation of the relevant
assets, but not the value of the assets subject to the concessions, based on the basis and
methodology set forth in the reversion (rescate) resolutions issued by the Ministry of
Communications and Transportation. Following a declaration of reversion, the assets that were
subject to the concession are automatically returned to the Mexican government.
In the event of war, natural disaster, grave disruption of the public order or an imminent
threat to national security, internal peace or the economy, the Mexican government may carry out a
requisition (requisa step-in rights) with respect to our airports. The step-in rights may be
exercised by the Mexican government as long as the circumstances warrant. In all cases, except
international war, the Mexican government is required to indemnify us for damages and lost profits
(daños y perjuicios) caused by such requisition, calculated at their real value (valor real);
provided that if we were to contest the amount of such indemnification, the amount of the
58
indemnity with respect to damages (daños) shall be fixed by expert appraisers appointed by us
and the Mexican government, and the amount of the indemnity with respect to lost profits
(perjuicios) shall be calculated taking into consideration the average net income during the year
immediately prior to the requisition. In the event of requisition due to international war, the
Mexican government would not be obligated to indemnify us.
Grants of New Concessions
The Mexican government may grant new concessions to manage, operate, develop and construct
airports. Such concessions may be granted through a public bidding process in which bidders must
demonstrate their technical, legal, managerial and financial capabilities. In addition, the
government may grant concessions without a public bidding process to the following entities:
|
|
|
parties who hold permits to operate civil aerodromes and intend to transform the
aerodrome into an airport so long as (i) the proposed change is consistent with the
national airport development programs and policies, (ii) the civil aerodrome has
been in continuous operation for the previous 5 years and (iii) the permit holder
complies with all requirements of the concession, |
|
|
|
|
current concession holders when necessary to meet increased demand so long as
(i) a new airport is necessary to increase existing capacity, (ii) the operation of
both airports by a single concession holder is more efficient than other options,
and (iii) the concession holder complies with all requirements of the concession, |
|
|
|
|
current concession holders when it is in the public interest for their airport
to be relocated, |
|
|
|
|
entities in the federal public administration, and |
|
|
|
|
commercial entities in which local or municipal governments have a majority
equity interest if the entities corporate purpose is to manage, operate, develop
and/or construct airports. |
Environmental Matters
Our operations are subject to Mexican federal and state laws and regulations relating to the
protection of the environment. The principal environmental laws include the General Law of
Ecological Balance and Environmental Protection, or the Ecological Law, which is administered by
the Federal Attorneys Office for the Protection of the Environment, the enforcement arm of the
Ministry of the Environment, Natural Resources and Fishing, and the Law of National Waters and its
regulations, which are administered by the National Water Commission. Under the Ecological Law,
regulations have been promulgated concerning air pollution, environmental impact studies, noise
control and hazardous wastes. The Ecological Law also regulates vibrations, thermal energy, soil
pollution and visual pollution that result from construction, although the Mexican government has
not yet issued specific enforcement standards on these issues. Pursuant to the Law of National
Waters, companies that discharge waste water must
59
comply with maximum allowable contaminant levels in order to preserve water quality. The
Ecological Law also provides that companies that contaminate the soil are responsible for clean-up.
Promulgated pursuant to the Ecological Law, Mexican Official Norms, which are technical
regulations issued by a competent regulatory authority, establish standards relating to air
emissions, discharges of pollution and waste water and the handling of hazardous waste. Mexican
Official Norms also regulate noise pollution. The Federal Attorneys Office for the Protection of
the Environment can bring administrative, civil and criminal proceedings against companies that
violate environmental laws, and it also has the power to close non-complying facilities. Every
company in Mexico is required to provide the National Institute of Ecology, the regulatory arm of
the Ministry of the Environment, Natural Resources and Fishing, with periodic reports regarding
compliance with the Ecological Law and the regulations thereunder.
The level of environmental regulation in Mexico has increased in recent years, and the
enforcement of the law is becoming more stringent. We expect this trend to continue and to be
stimulated by international agreements between Mexico and the United States. We do not expect that
compliance with Mexican environmental laws or Mexican state environmental laws will have a material
effect on our financial condition or results of operations. There can be no assurance, however,
that environmental regulations or the enforcement thereof will not change in a manner that could
have a material adverse effect on our business, results of operations, prospects or financial
condition.
The Procuraduria Federal de Proteccion Ambiental (PROFEPA) has issued clean industry
certificates for all of our airports. These certificates certify compliance with applicable
Mexican environmental law regulations. We are in compliance with the requirement to renew these
certificates every two years.
60
ORGANIZATIONAL STRUCTURE
The following table sets forth our consolidated subsidiaries as of December 31, 2006,
including our direct and indirect ownership interest in each:
|
|
|
|
|
Subsidiary |
|
Ownership Interest |
Aeropuerto de Cancun, S.A. de C.V. |
|
|
99.99 |
% |
Aeropuerto de Cozumel, S.A. de C.V. (1) |
|
|
99.99 |
% |
Aeropuerto de Merida, S.A. de C.V. |
|
|
99.99 |
% |
Aeropuerto de Huatulco, S.A. de C.V. (2) |
|
|
99.99 |
% |
Aeropuerto de Oaxaca, S.A. de C.V. |
|
|
99.99 |
% |
Aeropuerto de Veracruz, S.A. de C.V. (3) |
|
|
99.99 |
% |
Aeropuerto de Villahermosa, S.A. de C.V. |
|
|
99.99 |
% |
Aeropuerto de Tapachula, S.A. de C.V. (4) |
|
|
99.99 |
% |
Aeropuerto de Minatitlan, S.A. de C.V. (5) |
|
|
99.99 |
% |
Servicios Aeroportuarios del Sureste, S.A. de C.V. |
|
|
99.99 |
% |
|
|
|
(1) |
|
As of January 2005, Aeropuerto de Cancun, S.A. de C.V., has an 18.1% equity participation
in this airport. |
|
(2) |
|
As of January 2005, Aeropuerto de Cancun, S.A. de C.V., has a 24.2% equity participation in
this airport. |
|
(3) |
|
As of January 2005, Aeropuerto de Cancun, S.A. de C.V., has an 8.9% equity participation in
this airport. |
|
(4) |
|
As of January 2005, Aeropuerto de Cancun, S.A. de C.V.,
has a 30.0% equity participation in
this airport. |
|
(5) |
|
As of January 2005, Aeropuerto de Cancun, S.A. de C.V., has a 30.0% equity participation in
this airport. |
All of our subsidiaries are organized under the laws of Mexico.
PROPERTY, PLANT AND EQUIPMENT
Pursuant to the Mexican General Law of National Assets, all real estate and fixtures in our
airports are owned by the Mexican nation. Each of our concessions is scheduled to terminate in
2048, although each concession may be extended one or more times for up to an aggregate of an
additional fifty years. The option to extend a concession is subject to our acceptance of any
changes to such concession that may be imposed by the Ministry of Communications and Transportation
and our compliance with the terms of our current concessions. Upon expiration of our concessions,
these assets automatically revert to the Mexican nation, including improvements we may have made
during the terms of the concessions, free and clear of any liens and/or encumbrances, and we will
be required to indemnify the Mexican government for damages to these assets, except for those
caused by normal wear and tear.
Our corporate headquarters are located in Mexico City, and total 742.64 square meters. We
also rent two warehouses totaling 128 square meters located in Mexico City for storage. We
maintain comprehensive insurance coverage that covers the principal assets of our airports and
61
other property, subject to customary limits, against damage due to natural disasters,
accidents or similar events. We do not maintain business interruption insurance.
Item 4A. Unresolved Staff Comments
None.
Item 5. Operating and Financial Review and Prospects
The following discussion should be read in conjunction with, and is entirely qualified by
reference to, our financial statements and the notes to those financial statements. It does not
include all of the information included in our financial statements. You should read our
financial statements to gain a better understanding of our business and our historical results of
operations.
Our financial statements were prepared in accordance with Mexican NIF, which differs in
certain significant respects from U.S. GAAP. Note 16 to our financial statements provides a
description of the principal differences between Mexican NIF and U.S. GAAP as they relate to us.
See Differences between Mexican NIF and U.S. GAAP.
Overview
General
We operate nine airports in the southeastern region of Mexico pursuant to concessions granted
by the Mexican government. The substantial majority of our revenues are derived from providing
aeronautical services, which are generally related to the use of our airport facilities by airlines
and passengers. For example, in 2004, 2005 and 2006, approximately 75.4%, 70.8% and 70.9%
respectively, of our total revenues derived from aeronautical services. Changes in our revenues
from aeronautical services are principally driven by passenger and cargo volume at our airports.
Our revenues from aeronautical services are also affected by the maximum rates we are allowed to
charge under the price regulation system established by the Ministry of Communications and
Transportation. The maximum rate system of price regulation that applies to our aeronautical
revenues is linked to the traffic volume (measured in workload units) at each airport; thus,
increases in passenger and cargo volume generally permit greater revenues from aeronautical
services.
We also derive revenue from non-aeronautical activities, principally related to the commercial
services offered at our airports, such as the leasing of space to restaurants and retailers.
Revenues from non-aeronautical activities are not subject to the system of price regulation
established by the Ministry of Communications and Transportation. Thus, our non-aeronautical
revenues are primarily affected by the passenger volume at our airports and the mix of commercial
services offered at our airports. While aeronautical revenues should continue to represent a
substantial majority of our future total revenues, we anticipate that the future growth of our
revenues from commercial activities will eventually exceed the growth rate of our aeronautical
revenues.
Recent Developments
62
Recovery from Hurricane Wilma
Our results of operations in 2006 continued to be affected by the extensive damage caused by
Hurricane Wilma to hotel infrastructure in the Cancun, Cozumel and Mayan Riviera regions in October
2005, which adversely affected our passenger traffic. In addition,
the Terminal 1 (the charter terminal) at Cancun Airport sustained substantial damage from the hurricane. We were instructed by the Mexican
government to repair Terminal 1, and to put it back into
service.
As of year-end 2006, however, our results of operations had recovered significantly from
Hurricane Wilmas impact. Our passenger traffic increased 57.01% during the fourth quarter of 2006
as compared to the fourth quarter of 2005, and consequently, our revenues and operating income for
the fourth quarter of 2006 increased 66.37% and 713.84%, respectively, relative to the same period
in 2005.
On May 18, 2007, we began operations in the new Terminal 3 at Cancun Airport.
With a total investment of approximately U.S.$100 million, Terminal 3 constitutes our most
ambitious investment project to-date. Terminal 3 will double international passenger capacity at
Cancun Airport. The new building, measuring a total area of 42,000 square meters
(approximately 452,084 square feet), will feature 84 check-in counters and 11 boarding gates with
boarding bridges, as well as four gates served by buses. The terminal will feature
state-of-the-art passenger information systems and security equipment, including the first CT
scanning system in Mexico for all checked baggage. The cost of services may increase as a result
of these investments.
Mayan Riviera Airport Bidding Process
We have learned through various sources that the Mexican government, acting through the
Ministry of Communications and Transportation, is expected to use a public bidding process for the
award of the concession for the construction, operation and management of an international airport
in the Mayan Rivera in the state of Quintana Roo. We are not yet aware of any details regarding
the expected public bidding process, including the timing or other terms. We are interested in
participating in this bidding process, although there can be no assurance as to the outcome. See
Risk FactorsRisks Relating to Our Operations.
Passenger Traffic Volume and Composition
Our principal source of revenues is passenger charges collected from airlines for each
passenger departing from the airport terminals we operate (excluding diplomats, infants and
transfer and transit passengers). In 2004, 2005 and 2006, passenger charges represented 79.9%,
80.0% and 76.9% of our aeronautical services revenues and 60.3%, 56.7% and 54.6%, respectively, of
our consolidated revenues. It follows that the main factor affecting our results of operations is
the number of passengers using our airports.
In recent years, the aggregate passenger traffic volume in our airports has been divided
between domestic and international passengers at fairly constant levels. In 2004, 2005 and 2006,
for example, approximately 61.6%, 60.7% and 58.20%, respectively, of the passengers using our
63
airports were international and the remaining were domestic. During 2004, 2005 and 2006, 42.1%,
38.1% and 35.1% of our total revenues were derived from passenger charges collected from
international passengers.
Of our passengers traveling internationally, a majority has historically traveled on flights
to or from the United States. In 2004, 2005 and 2006, for example, approximately 42.7%, 41.9% and
38.5% of the total passengers and approximately 69.4%, 69.0% and 66.1%, respectively, of the
international passengers in our airports arrived or departed on flights originating in or departing
to the United States. As a consequence, our results of operations are substantially influenced by
U.S. economic and other conditions, particularly trends and events affecting leisure travel and
consumer spending. In addition, of our passengers traveling domestically, a majority has typically
traveled on flights to or from Mexico City. In 2004, 2005 and 2006, for example,
approximately 83.5%, 84.3% and 80.6%, respectively, of the domestic passengers in our airports
arrives or departed on flights originating in or departing to Mexico City. Many factors affecting
our passenger traffic volume and the mix of passenger traffic in our airports are beyond our
control.
Classification of Revenues and Price Regulation
For financial reporting purposes, we classify our revenues into two categories: revenues from
aeronautical services and revenues from non-aeronautical services. Our revenues from aeronautical
services hinge on passenger charges, landing charges, aircraft parking charges, charges for airport
security services and for the use of passenger walkways. Our revenues from non-aeronautical
services are associated with the leasing of space in our airports to airlines, retailers and other
commercial tenants, access fees collected from third parties providing complementary services at
our airports and related miscellaneous sources.
Revenues from our airports are subject to a dual-till price regulation system. Under this
system, a substantial portion of our revenues, such as revenues from passenger charges, landing
charges, aircraft parking charges and access fees from third parties providing services at our
airports, are regulated. Based on our classification of revenues for financial reporting purposes,
all of our revenues from aeronautical services and certain of our revenues from non-aeronautical
services are regulated by the Ministry of Communications and Transportation. The system of price
regulation applicable to our airports establishes an annual maximum rate in pesos for each airport,
which is the maximum annual amount of revenues per work load unit (equal to one passenger or 100
kilograms (220 pounds) of cargo) that we may earn at that airport from regulated services. The
maximum rates for our airports have been determined for each year through December 31, 2008. In
2004, 2005 and 2006, approximately 78.8%, 74.6% and 74.7%, respectively, of our total revenues and
approximately 15.5%, 13.7% and 12.9%, respectively, of our revenues from non-aeronautical services
were earned from regulated sources of revenues. Revenues associated with leased space in our
terminals (other than space leased to airlines and other space deemed essential to our airports by
the Ministry of Communications and Transportation) are currently not regulated under the price
regulation system.
64
The following table sets forth our revenues for the years ended December 31, 2004, 2005
and 2006, based on the categories of services established under the Mexican Airport Law.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
(thousands of pesos, except percentages) |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
Regulated Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Airport Services(1) |
|
|
1,673,657 |
|
|
|
78.8 |
% |
|
|
1,601,756 |
|
|
|
74.6 |
% |
|
|
1,671,636 |
|
|
|
74.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-regulated Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Access fees from non-permanent
ground transportation |
|
|
8,436 |
|
|
|
0.4 |
% |
|
|
7,748 |
|
|
|
0.4 |
% |
|
|
8,695 |
|
|
|
0.4 |
% |
Car parking and related access fees |
|
|
27,670 |
|
|
|
1.3 |
% |
|
|
34,040 |
|
|
|
1.6 |
% |
|
|
37,710 |
|
|
|
1.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other fees |
|
|
3,375 |
|
|
|
0.1 |
% |
|
|
3,179 |
|
|
|
0.1 |
% |
|
|
2,362 |
|
|
|
0.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Complementary Services(1) |
|
|
0 |
|
|
|
0.0 |
% |
|
|
0 |
|
|
|
0.0 |
% |
|
|
0 |
|
|
|
0.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial Services |
|
|
397,186 |
|
|
|
18.7 |
% |
|
|
478,745 |
|
|
|
22.3 |
% |
|
|
494,550 |
|
|
|
22.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Services |
|
|
14,267 |
|
|
|
0.7 |
% |
|
|
21,992 |
|
|
|
1.0 |
% |
|
|
24,008 |
|
|
|
1.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
2,124,591 |
|
|
|
100.0 |
% |
|
|
2,147,460 |
|
|
|
100.0 |
% |
|
|
2,238,961 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Access fees charged to third parties providing complementary services in our airports are
recorded under regulated airport services. |
Aeronautical Revenue
The system of price regulation applicable to our aeronautical revenues establishes a maximum
rate in pesos for each airport for each year in a five-year period, which is the maximum annual
amount of revenue per workload unit (equal to one terminal passenger or 100 kilograms (220 pounds)
of cargo) that we may earn at that airport from aeronautical services. See Regulatory
FrameworkPrice Regulation for a description of our maximum rates and the rate setting procedures
for future periods. The maximum rates for our airports have been determined for each year through
December 31, 2008.
The following table sets forth our revenue from aeronautical services for the years indicated.
Aeronautical Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
|
(millions of pesos, except percentages and workload unit data) |
Aeronautical Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger charges |
|
|
1,281.6 |
|
|
|
80.0 |
% |
|
|
1,216.6 |
|
|
|
80.0 |
% |
|
|
1,221.7 |
|
|
|
76.9 |
% |
Landing charges |
|
|
121.5 |
|
|
|
7.6 |
% |
|
|
121.4 |
|
|
|
8.0 |
% |
|
|
117.6 |
|
|
|
7.4 |
% |
Aircraft parking charges |
|
|
140.5 |
|
|
|
8.8 |
% |
|
|
135.4 |
|
|
|
8.9 |
% |
|
|
195.8 |
|
|
|
12.3 |
% |
Airport security charges |
|
|
33.5 |
|
|
|
2.0 |
% |
|
|
23.0 |
|
|
|
1.5 |
% |
|
|
22.7 |
|
|
|
1.4 |
% |
Passenger walkway charges |
|
|
25.5 |
|
|
|
1.6 |
% |
|
|
23.8 |
|
|
|
1.6 |
% |
|
|
30.1 |
|
|
|
1.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Aeronautical Revenue |
|
|
1,602.6 |
|
|
|
100.0 |
% |
|
|
1,520.2 |
|
|
|
100.0 |
% |
|
|
1,587.9 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
|
(millions of pesos, except percentages and workload unit data) |
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total workload units(1) |
|
|
14.3 |
|
|
|
|
|
|
|
13.8 |
|
|
|
|
|
|
|
14.3 |
|
|
|
|
|
Total aeronautical revenue per workload unit |
|
|
112.1 |
|
|
|
|
|
|
|
110.2 |
|
|
|
|
|
|
|
111.0 |
|
|
|
|
|
Change in aeronautical revenue |
|
|
21.9 |
% |
|
|
|
|
|
|
(5.1 |
%) |
|
|
|
|
|
|
4.5 |
% |
|
|
|
|
Change in total aeronautical
revenues per workload unit(2) |
|
|
7.3 |
% |
|
|
|
|
|
|
(1.7 |
%) |
|
|
|
|
|
|
0.7 |
% |
|
|
|
|
|
|
|
(1) |
|
In millions. Under the regulation applicable to our aeronautical revenues, a workload unit
is equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo. |
|
(2) |
|
In each case, as compared to previous year. |
Under the regulatory system applicable to our aeronautical revenues, we can set the
specific price for each category of aeronautical services every six months (or more frequently if
accumulated inflation since the last adjustment exceeds 5%), as long as the total aeronautical
revenue per workload unit each year at each of our airports does not exceed the maximum rate at
that airport for that year. The specific prices we charge for regulated services are based on
various factors, including projections of passenger traffic volumes, capital expenditures estimated
in our master development programs, the Mexican producer price index (excluding petroleum) and the
value of the peso relative to the U.S. dollar. We currently set the specific price for each
category of aeronautical services after negotiating with our principal airline customers. Our
current agreements with principal airline customers are scheduled to expire on December 31, 2008.
Under these agreements, our specific prices are structured such that the substantial majority of
our aeronautical revenues are derived from passenger charges, and we expect this to continue to be
the case in future agreements. In 2004, 2005 and 2006, passenger charges represented 80.0%, 80.0%
and 76.9% of our aeronautical service revenues and 60.3%, 56.7% and 54.60%, respectively, of our
consolidated revenues.
Historically, we have set our prices for regulated services at our airports as close as
possible to the maximum rates allowed in any given year, and we expect to pursue this pricing
strategy in the future. In December 2004, the Ministry of Communications and Transportation
established new maximum rates applicable to our airports from January 1, 2004 through December 31,
2008 that are higher than the maximum rates applicable to our airports for the previous five-year
period. There can be no assurance that we will be able to collect most of the revenue we are
entitled to earn from services subject to price regulation in the future. For a discussion of
risks relating to our ability to set specific prices, see Risk FactorsRisks Related to Our
Operations.
Our regulated revenues at each airport are subject to a maximum rate established by the
Ministry of Communications and Transportation. To avoid exceeding the maximum rate established at
an airport for any given year, we have historically taken measures to ensure that the maximum rates
are not exceeded at year end, including reducing prices during the latter part of the year and
issuing rebates or discounts to customers as price adjustments. These price adjustments or rebates
constitute a reduction of the selling prices (i.e., the amounts originally billed to customers for
services rendered), and therefore, are characterized as a reduction of the related revenues
recognized during the year, both for Mexican NIF and U.S. GAAP purposes. All discounts and rebates
are issued and recorded in the same year as the service is provided. In 2004, 2005 and 2006, we
did not issue rebates in significant amounts.
66
The following table sets forth the number of passengers paying passenger charges for the
years indicated.
Passengers Paying Passenger Charges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
|
|
|
|
|
|
|
|
% change |
|
|
|
|
|
% change |
Airport |
|
2004 |
|
2005 |
|
2004-2005 |
|
2006 |
|
2005-2006 |
|
|
(in thousands, except percentages) |
Cancun |
|
|
4,982.2 |
|
|
|
4,615.3 |
|
|
|
(7.4 |
%) |
|
|
4,820.2 |
|
|
|
4.4 |
% |
Merida |
|
|
447.6 |
|
|
|
485.6 |
|
|
|
8.5 |
% |
|
|
490.0 |
|
|
|
0.9 |
% |
Cozumel |
|
|
291.1 |
|
|
|
243.7 |
|
|
|
(16.3 |
%) |
|
|
182.3 |
|
|
|
(25.2 |
%) |
Villahermosa |
|
|
341.9 |
|
|
|
359.6 |
|
|
|
5.2 |
% |
|
|
359.7 |
|
|
|
0.0 |
% |
Other |
|
|
862.1 |
|
|
|
907.7 |
|
|
|
5.3 |
% |
|
|
977.2 |
|
|
|
7.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
6,924.9 |
|
|
|
6,611.9 |
|
|
|
(4.5 |
%) |
|
|
6,829.4 |
|
|
|
3.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
We earn passenger charges from each departing passenger at our airports, other than transit
passengers, diplomats and infants.
Non-aeronautical Revenue
Our revenues from non-aeronautical services are principally derived from commercial
activities, such as leasing of space in our airports to airlines, leasing of space to, and
collection of royalties from, third parties operating stores and providing commercial services at
our airports and access fees charged to operators of automobile parking facilities and providers of
complementary services. None of our revenues from non-aeronautical services are subject to price
regulation under our dual-till price regulation system.
Our revenues from non-aeronautical services increased from Ps. 627.3 million in 2005 to Ps.
651.1 million in 2006 as a result of increased development of our commercial activities. During
this period, our non-aeronautical revenue per terminal passenger increased by approximately 0.02%,
from Ps. 47.17 in 2005 to Ps. 47.18 in 2006.
67
The following table sets forth our revenue from non-aeronautical activities for the years
indicated.
Non-aeronautical Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
|
(millions of pesos, except percentages and passenger data) |
Non-aeronautical Services: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
407.1 |
|
|
|
78.0 |
% |
|
|
483.6 |
|
|
|
77.1 |
% |
|
|
503.4 |
|
|
|
77.3 |
% |
Leasing of space |
|
|
394.3 |
|
|
|
75.6 |
% |
|
|
472.8 |
|
|
|
75.4 |
% |
|
|
493.4 |
|
|
|
75.8 |
% |
Access fee |
|
|
9.9 |
|
|
|
1.8 |
% |
|
|
7.7 |
|
|
|
1.2 |
% |
|
|
8.7 |
|
|
|
1.3 |
% |
Other |
|
|
2.9 |
|
|
|
0.6 |
% |
|
|
3.1 |
|
|
|
0.5 |
% |
|
|
1.3 |
|
|
|
0.2 |
% |
Non Commercial |
|
|
114.8 |
|
|
|
22.0 |
% |
|
|
143.7 |
|
|
|
22.9 |
% |
|
|
147.7 |
|
|
|
22.7 |
% |
Leasing of space |
|
|
59.0 |
|
|
|
11.3 |
% |
|
|
59.3 |
|
|
|
9.5 |
% |
|
|
51.7 |
|
|
|
7.9 |
% |
Access fee |
|
|
48.2 |
|
|
|
9.2 |
% |
|
|
60.9 |
|
|
|
9.7 |
% |
|
|
62.5 |
|
|
|
9.6 |
% |
Other |
|
|
7.6 |
|
|
|
1.5 |
% |
|
|
23.5 |
|
|
|
3.7 |
% |
|
|
33.5 |
|
|
|
5.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Non-aeronautical Revenue |
|
|
521.9 |
|
|
|
100.0 |
% |
|
|
627.3 |
|
|
|
100.0 |
% |
|
|
651.1 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total terminal passengers(1) |
|
|
13.9 |
|
|
|
|
|
|
|
13.3 |
|
|
|
|
|
|
|
13.8 |
|
|
|
|
|
Non-aeronautical revenue per
terminal passenger |
|
|
37.5 |
|
|
|
|
|
|
|
47.17 |
|
|
|
|
|
|
|
47.18 |
|
|
|
|
|
Change in non-aeronautical
revenue |
|
|
51.1 |
% |
|
|
|
|
|
|
20.2 |
% |
|
|
|
|
|
|
3.8 |
% |
|
|
|
|
Change in total non-aeronautical
revenue per terminal passenger(2) |
|
|
30.2 |
% |
|
|
|
|
|
|
25.8 |
% |
|
|
|
|
|
|
0.02 |
% |
|
|
|
|
|
|
|
(1) |
|
In millions. |
|
(2) |
|
In each case, as compared to previous year. |
Operating Costs
The following table sets forth our operating costs and certain other related information for
the years indicated.
Operating Costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Amount |
|
Amount |
|
% change |
|
Amount |
|
% change |
|
|
(millions of pesos, except percentages) |
Operating Costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee costs |
|
|
230.8 |
|
|
|
244.2 |
|
|
|
5.8 |
% |
|
|
269.6 |
|
|
|
10.4 |
% |
Maintenance |
|
|
92.3 |
|
|
|
101.7 |
|
|
|
10.1 |
% |
|
|
103.9 |
|
|
|
2.2 |
% |
Safety, security and
insurance |
|
|
72.3 |
|
|
|
71.0 |
|
|
|
(1.8 |
%) |
|
|
95.6 |
|
|
|
34.6 |
% |
Utilities |
|
|
54.3 |
|
|
|
57.1 |
|
|
|
5.2 |
% |
|
|
62.5 |
|
|
|
9.5 |
% |
Other |
|
|
166.5 |
|
|
|
213.4 |
|
|
|
28.3 |
% |
|
|
207.1 |
|
|
|
(3.0 |
%) |
Total cost of services |
|
|
616.2 |
|
|
|
687.4 |
|
|
|
11.6 |
% |
|
|
738.7 |
|
|
|
7.5 |
% |
68
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Amount |
|
Amount |
|
% change |
|
Amount |
|
% change |
|
|
(millions of pesos, except percentages) |
Technical assistance fees |
|
|
72.0 |
|
|
|
69.1 |
|
|
|
(4.0 |
%) |
|
|
71.0 |
|
|
|
2.7 |
% |
Government concession fees |
|
|
106.2 |
|
|
|
107.4 |
|
|
|
1.1 |
% |
|
|
111.8 |
|
|
|
4.1 |
% |
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation(1) |
|
|
170.6 |
|
|
|
177.2 |
|
|
|
3.8 |
% |
|
|
223.4 |
|
|
|
26.1 |
% |
|
Amortization(2) |
|
|
258.9 |
|
|
|
274.5 |
|
|
|
6.0 |
% |
|
|
264.4 |
|
|
|
(3.7 |
%) |
Total depreciation and amortization |
|
|
429.5 |
|
|
|
451.7 |
|
|
|
5.2 |
% |
|
|
487.8 |
|
|
|
8.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
costs |
|
|
1,223.9 |
|
|
|
1,315.6 |
|
|
|
7.5 |
% |
|
|
1,409.3 |
|
|
|
7.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total workload units(3) |
|
|
14,352.7 |
|
|
|
13,788.3 |
|
|
|
(3.9 |
%) |
|
|
14,252.9 |
|
|
|
3.4 |
% |
Cost of services per workload unit |
|
|
42.9 |
|
|
|
49.9 |
|
|
|
16.1 |
% |
|
|
51.8 |
|
|
|
4.0 |
% |
Cost of services margin(4) |
|
|
29.0 |
% |
|
|
32.0 |
% |
|
|
10.3 |
% |
|
|
33.0 |
% |
|
|
3.1 |
% |
|
|
|
(1) |
|
Reflects depreciation of fixed assets. |
|
(2) |
|
Reflects amortization of our concessions and recovered long-term leases (long-term
third-party leases granted by our predecessor to operate commercial areas in our airports). |
|
(3) |
|
In thousands. Under the regulation applicable to our aeronautical revenues, a workload unit
is equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo. |
|
(4) |
|
Cost of services divided by total revenues, expressed as a percentage. |
Cost of Services
Our cost of services consists primarily of employee, maintenance, safety, security and
insurance costs, as well as utilities (a portion of which we recover from our tenants) and other
miscellaneous expenses. In recent years, our cost of services per workload unit has increased,
from Ps. 42.9 in 2004 to Ps. 51.8 in 2006.
Technical Assistance Fee and Government Concession Fee
Under the technical assistance agreement, ITA provides management and consulting services and
transfers technical assistance, technological and industry knowledge, as well as experience to us
for a fee. For further detail on the ITA agreement, see Related Party Transactions.
We are subject to the Mexican Federal Duties Law, which requires each of our airports to pay a
concession fee to the Mexican government, which is currently equal to 5% of the gross annual
revenues of each concession holder obtained from the use of public domain assets pursuant to the
terms of its concession. The concession fee may vary on an annual basis as determined solely by
the Mexican federal congress, and there can be no assurance that this fee may not increase in the
future. If the Mexican federal congress increases the concession fee, we are entitled to request
an increase in our maximum rates from the Ministry of Communications and Transportation; however,
there can be no assurance that the Ministry of Communications and Transportation would honor our
request.
Depreciation and Amortization
Our depreciation and amortization expenses primarily reflect the amortization of our
investment in our nine concessions. In addition, we depreciate the value of certain fixed assets
we acquire or build at our airports pursuant to the investment requirements under our master
development programs.
69
Taxation
Mexican companies are generally required to pay the greater of their income tax liability or
their asset tax liability (determined at a rate of 1.8% of the average tax value of virtually all
of their assets (including, in our case, our concessions), less the average tax value of certain
liabilities (basically liabilities owed to Mexican residents excluding those with financial
institutions or their intermediaries)). In December 2006, the Mexican authorities approved a
change in the methodology used to calculated asset tax liabilities and reduced the tax rates to
1.25% from 1.8%, which is now applicable to the average tax value of virtually all of the companys
assets without reducing the average tax value of certain liabilities. If, in any year, the asset
tax liability exceeds the income tax liability, the asset tax payment for such excess may be
reduced by the amount by which the income tax exceeded the asset tax in the three preceding years.
In 2004, 2005 and 2006, we and our subsidiaries paid an aggregate of Ps. 167.9 million, Ps. 141.2
million and Ps. 121.3 million, respectively, in asset taxes.
As a result of changes in the Mexican income tax law, the latest of which became effective on
January 1, 2005, the income tax rate was 29% in 2006 and is scheduled to decrease to 28% for 2007
and 28% thereafter. As a result of this change in tax rates, we reversed a portion of our net
deferred income tax liability and recorded Ps. 48.4 million as income in 2006. In addition, we
amortize investments in our concessions for tax purposes at rates that range from 6% to 10% per
year. This accelerated depreciation reduces current income tax payments. As permitted under
Mexican tax law, for the 2004 tax year we elected to increase the rate at which we depreciate our
investment in Cancun Airport from 10% to 15% for tax purposes and in the 2005 tax year we decided
to increase the rates for Villahermosa Airport from 6% to 10%. Because we are required under
Mexican NIF to amortize investments in our concessions over a longer period for financial reporting
purposes, we will continue to record a deferred tax liability and provision in our financial
statements regarding the difference between the amount of amortization for tax and financial
reporting purposes.
We are subject to the mandatory employee statutory profit sharing regime established by
Mexican federal labor laws. Under this regime, 10% of a companys unconsolidated annual profits,
as calculated for tax purposes, must be distributed among employees other than the chief executive
officer. We were not required to pay employee statutory profit sharing in 2004, 2005 and 2006
because we generated tax losses in those years. On May 3, 2005, the Mexican Supreme Court ruled in
a plenary session relating to four cases that net operating loss carry-forwards could not be
deducted when calculating net taxable income for profit sharing liability purposes. In light of
these decisions, we have decided not to include net operating loss carry-forwards in the
calculation of its profit sharing liability.
Our results of operations reflect the accrual of a technical assistance fee to ITA under the
technical assistance agreement. For further information on this fee, see Item 4, Information on
the CompanyHistory and Development of the CompanyInvestment by ITA.
70
Effects of Devaluation and Inflation
The following table sets forth, for the periods indicated:
|
|
|
the percentage that the Mexican peso depreciated or appreciated against the U.S.
dollar; |
|
|
|
|
the Mexican inflation rate; |
|
|
|
|
the U.S. inflation rate; and |
|
|
|
|
the percentage that the Mexican gross domestic product, or GDP, changed as compared
to the previous period. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
Depreciation (appreciation) of the Mexican Peso as
compared to the U.S. dollar(1) |
|
|
(0.7 |
%) |
|
|
(4.6 |
%) |
|
|
1.7 |
% |
Mexican inflation rate(2) |
|
|
5.2 |
% |
|
|
3.3 |
% |
|
|
4.1 |
% |
U.S. inflation rate(3) |
|
|
3.3 |
% |
|
|
3.4 |
% |
|
|
2.5 |
% |
Increase in Mexican gross domestic product(4) |
|
|
4.2 |
% |
|
|
3.0 |
% |
|
|
4.8 |
% |
|
|
|
(1) |
|
Based on changes in the rates for calculating foreign exchange liabilities, as reported by
Banco de Mexico, the Mexican Central Bank, at the end of each period, which were as follows:
Ps. 11.1495 per U.S. dollar as of December 31, 2004, Ps. 10.6344 per U.S. dollar as of
December 31, 2005 and Ps. 10.8116 per U.S. dollar as of December 31, 2006. |
|
(2) |
|
Based on changes in the Mexican consumer price index from the previous period, as reported by
the Banco de Mexico. The Mexican consumer price index at year end was: 112.5500 in
2004, 116.3010 in 2005 and 121.0150 in 2006. |
|
(3) |
|
As reported by the U.S. Department of Labor, Bureau of Statistics. |
|
(4) |
|
In real terms, as reported by the Mexican National Statistical, Geographic and Information
Institute (INEGI) as of February 16, 2007. |
The general condition of the Mexican economy, changes in the value of the peso as
compared to the dollar, inflation and high interest rates have in the past adversely affected, and
may in the future adversely affect, our:
|
|
|
Depreciation and amortization expense. We restate our non-monetary foreign assets
to give effect to inflation. The restatement of these assets in periods of high
inflation increases the carrying value of these assets in pesos, which in turn
increases the related depreciation expense and risk of impairments. Our airport
concessions are being amortized on a straight-line basis over the life of the
concession and rights acquired. |
|
|
|
|
Passenger charges. Passenger charges for international passengers are currently
denominated in dollars, while passenger charges for domestic passengers are denominated
in pesos. Because Mexican NIF requires Mexican companies to restate their results of
operations in prior periods in constant pesos as of the most recent balance sheet date,
when the rate of inflation in a period exceeds the depreciation of the peso as compared
to the dollar for that period, the peso value of dollar-denominated or dollar-linked
revenues in the prior period will be higher than those of the current period. This
effect may occur despite the fact that the amount of such revenues in dollar terms may
have been greater in the current period. |
|
|
|
|
Comprehensive financing result (cost). As required by Mexican NIF, our
comprehensive financing cost reflects gains or losses from foreign exchange, gains or
losses from monetary position and gains and losses from interest and, as a result is
impacted by both inflation and depreciation. |
71
|
|
|
Maximum rates in pesos. Our tariffs for the services we provide to international
flights or international passengers are denominated in U.S. dollars, but are generally
paid in Mexican pesos based on the average exchange rate for the month prior to each
flight. We generally collect passenger charges from airlines 60-115 days following the
date of each flight. We intend to charge prices that are as close as possible to the
maximum rates that we can charge. Since we are usually only entitled to adjust our
specific prices once every six months (or earlier upon a cumulative increase of 5% in
the Mexican producer price index, excluding petroleum), a depreciation of the peso as
compared to the dollar, particularly late in the year, could cause us to exceed the
maximum rates at one or more of our airports, possibly leading to the termination of
one of our concessions. In the event that any one of our concessions is terminated,
our other concessions may also be terminated. In addition, if the peso appreciates as
compared to the dollar we may underestimate the specific prices we can charge for
regulated services and be unable to adjust our prices upwards to maximize our regulated
revenues. |
72
Operating Results by Airport
The following table sets forth our results of operations for the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
2004 |
|
2005 |
|
2006 |
|
|
Airport Operating Results |
|
|
(millions of pesos) |
Cancun: |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
Ps. |
1,212.2 |
|
|
Ps. |
1,103.3 |
|
|
Ps. |
1,166.2 |
|
Non-aeronautical services |
|
|
411.8 |
|
|
|
505.6 |
|
|
|
527.3 |
|
Total revenues |
|
|
1,624.0 |
|
|
|
1,608.9 |
|
|
|
1,693.5 |
|
Operating income |
|
|
851.6 |
|
|
|
780.2 |
|
|
|
810.4 |
|
Merida: |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
|
91.7 |
|
|
|
100.8 |
|
|
|
98.1 |
|
Non-aeronautical services |
|
|
34.3 |
|
|
|
36.5 |
|
|
|
38.5 |
|
Total revenues |
|
|
126.0 |
|
|
|
137.4 |
|
|
|
136.6 |
|
Operating income |
|
|
15.4 |
|
|
|
19.5 |
|
|
|
14.2 |
|
Villahermosa: |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical Services |
|
|
64.7 |
|
|
|
70.8 |
|
|
|
74.8 |
|
Non Aeronautical Services |
|
|
18.5 |
|
|
|
21.4 |
|
|
|
22.2 |
|
Total revenues |
|
|
83.2 |
|
|
|
92.2 |
|
|
|
97.0 |
|
Operating income |
|
|
21.3 |
|
|
|
26.9 |
|
|
|
16.4 |
|
Cozumel: |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
|
66.2 |
|
|
|
59.7 |
|
|
|
45.5 |
|
Non-aeronautical services |
|
|
18.6 |
|
|
|
17.6 |
|
|
|
15.6 |
|
Total revenues |
|
|
84.8 |
|
|
|
77.3 |
|
|
|
61.1 |
|
Operating
(loss) income(1) |
|
|
15.5 |
|
|
|
11.8 |
|
|
|
(5.9 |
) |
Other:(2) |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
|
167.9 |
|
|
|
185.6 |
|
|
|
203.3 |
|
Non-aeronautical services |
|
|
38.7 |
|
|
|
46.2 |
|
|
|
47.5 |
|
Total revenues |
|
|
206.5 |
|
|
|
231.7 |
|
|
|
250.8 |
|
Operating (loss) income |
|
|
(3.1 |
) |
|
|
(6.6 |
) |
|
|
(5.4 |
) |
Total: |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
|
1,602.6 |
|
|
|
1,520.2 |
|
|
|
1,587.9 |
|
Non-aeronautical services |
|
|
521.9 |
|
|
|
627.3 |
|
|
|
651.1 |
|
Total revenues |
|
|
2,124.6 |
|
|
|
2,147.5 |
|
|
|
2,239.0 |
|
Operating income |
|
|
900.6 |
|
|
|
831.8 |
|
|
|
829.7 |
|
|
|
|
(1) |
|
The losses in 2006 reflect the decrease in passenger volume
due to Hurricane Wilma, which we estimate will recover over time. |
(2) |
|
Reflects the results of operations of our parent holding company, our airports located in
Veracruz, Minatitlan, Oaxaca, Huatulco and Tapachula and consolidation adjustments. |
73
Summary Historical Results of Operations
The following table sets forth our consolidated results of operations for the periods
indicated.
Consolidated Operating Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
|
(thousands of pesos) |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
Ps |
1,602,630 |
|
|
Ps. |
1,520,152 |
|
|
Ps. |
1,587,904 |
|
Non-aeronautical services |
|
|
521,961 |
|
|
|
627,308 |
|
|
|
651,057 |
|
Total revenues |
|
|
2,124,591 |
|
|
|
2,147,460 |
|
|
|
2,238,961 |
|
Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services |
|
|
(502,494 |
) |
|
|
(580,611 |
) |
|
|
(641,173 |
) |
General and administrative expenses |
|
|
(113,710 |
) |
|
|
(106,889 |
) |
|
|
(97,491 |
) |
Technical assistance(1) |
|
|
(71,991 |
) |
|
|
(69,123 |
) |
|
|
(71,037 |
) |
Concession fee(2) |
|
|
(106,189 |
) |
|
|
(107,373 |
) |
|
|
(111,804 |
) |
Depreciation and amortization |
|
|
(429,597 |
) |
|
|
(451,674 |
) |
|
|
(487,788 |
) |
Total operating expenses |
|
|
(1,223,981 |
) |
|
|
(1,315,670 |
) |
|
|
(1,409,293 |
) |
Operating income |
|
|
900,610 |
|
|
|
831,790 |
|
|
|
829,668 |
|
Comprehensive Financing Result (Cost): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, net |
|
|
48,864 |
|
|
|
106,689 |
|
|
|
99,579 |
|
Exchange (losses) gains, net |
|
|
(7,477 |
) |
|
|
(16,786 |
) |
|
|
3,957 |
|
Loss from monetary position |
|
|
(72,253 |
) |
|
|
(66,234 |
) |
|
|
(88,322 |
) |
Net comprehensive financing (cost) income |
|
|
(30,866 |
) |
|
|
23,669 |
|
|
|
15,214 |
|
Income before taxes, employees statutory
profit sharing and extraordinary items |
|
|
869,744 |
|
|
|
855,459 |
|
|
|
844,882 |
|
Provision for income taxes and employees
statutory profit sharing |
|
|
(198,053 |
) |
|
|
(260,115 |
) |
|
|
(301,113 |
) |
Extraordinary items |
|
|
(19,046 |
) |
|
|
(9,327 |
) |
|
|
(15,654 |
) |
Net income |
|
|
652,645 |
|
|
|
586,017 |
|
|
|
528,115 |
|
Other Operating Data (Unaudited): |
|
|
|
|
|
|
|
|
|
|
|
|
Operating margin(3) |
|
|
42.4 |
% |
|
|
38.7 |
% |
|
|
37.1 |
% |
Net margin(4) |
|
|
30.7 |
% |
|
|
27.3 |
% |
|
|
23.6 |
% |
|
|
|
(1) |
|
We are required to pay ITA a technical assistance fee based on the technical assistance
agreement. This fee is described in Item 4. Information on the CompanyHistory and
Development of the CompanyInvestment by ITA. |
|
(2) |
|
Each of our subsidiary concession holders is required to pay a concession fee to the Mexican
government under the Mexican Federal Duties Law. The concession fee is currently 5% of each
concession holders gross annual revenues from the use of public domain assets pursuant to the
terms of its concession. |
|
(3) |
|
Operating income divided by total revenues, expressed as a percentage.
|
|
(4) |
|
Net income divided by total revenues, expressed as a percentage. |
Results of operations for the year ended December 31, 2006 compared to the year ended December
31, 2005
Revenues
Total revenues for 2006 were Ps. 2,238.9 million, 4.3% higher than the Ps. 2,147.5 million
recorded in 2005. The increase in total revenues resulted from an increase of 4.5% in revenues
from aeronautical services and an increase of 3.8% in revenues from non-aeronautical services.
74
Our revenues from aeronautical services, net of rebates, increased 4.5% to Ps. 1,587.9 million
in 2006 from Ps. 1,520.2 million in 2005, due primarily to the 3.44% increase in passenger volume.
Revenues from passenger charges increased 4.3% to Ps. 1,221.7 million in 2006 (76.9% of our
aeronautical revenues during the period) from Ps. 1,216.6 million in 2005 (80.0% of our
aeronautical revenues during the period).
Revenues from non-aeronautical services increased 3.8% to Ps. 651.0 million in 2006 from Ps.
627.3 million in 2005, principally due to an increase in commercial revenues resulting from the new
concession contract for duty-free shops with Aldeasa, which included a one-time payment of Ps. 19.1
million. The increase in revenues from non-aeronautical services also resulted in part from an
8.51% increase in food and beverage revenues due to a one-time payment received from Hoteleria e
Inmobiliaria, S.A. de C.V. (an affiliate of Grupo Mera) for the lease of a restaurant that until
June 2006 was operated directly by us, as well as a 6.27% increase in retail revenues derived from
three convenience stores we have operated directly since 2005 and 11 new convenience stores at the
Cancun, Merida, Villahermosa, Oaxaca and Huatulco airports operated by new commercial tenants. A
10.78% increase in revenues from parking lots, a 22.15% increase in advertising revenue, and a
10.49% increase in revenues from ground transportation also contributed to the increase in revenues
from non-aeronautical services. This increase was partially offset by a 5.93% decrease in
duty-free revenues as well as a 14.23% decrease in revenues from banking and currency exchange
services.
Our revenues from regulated sources in 2006 were Ps. 1,671.6 million, a 4.4% increase compared
to Ps. 1,601.7 million in 2005, mainly due to the increase in total passenger traffic of 3.44%.
During 2006, Ps. 567.3 million of our revenues derived from non-regulated sources, a 4% increase
from the Ps. 545.7 million of revenues derived from non-regulated sources in 2005. This increase
was primarily due to the 4.1% increase in commercial revenues described above.
Operating Expenses and Operating Income
Total operating expenses were Ps. 1,409.2 million in 2006, a 7.1% increase from the Ps.
1,315.6 million recorded in 2005, primarily as a result of a 10.4% increase in cost of services, a
2.8% increase in technical assistance fees and a 4.1% increase in concession fees. These sources
of increased costs were partially offset by an 8.8% decrease in general and administrative expenses.
As a percentage of total revenues, operating expenses increased to 62.9% of total revenues in 2006
from 61.3% of total revenues in 2005.
Cost of services increased 10.4% to Ps. 641.1 million in 2006 from Ps. 580.6 million in 2005.
The increase was principally due to higher personnel costs associated with the implementation of
new baggage screening procedures and an increase in insurance premiums.
General and administrative expenses decreased 8.8% to Ps. 97.4 million in 2006 from Ps. 106.8
million in 2005. This decrease was primarily attributable to a decrease in professional fees paid
during the period.
Technical assistance fees increased by 2.8% to Ps. 71.0 million in 2006 from Ps. 69.1 million
in 2005, and concession fees increased by 4.1% to Ps. 111.8 million in 2006 from Ps. 107.3 million
in 2005. The technical assistance fees increased in 2006 due to the
75
corresponding increase in EBITDA during the period. The increase in concession fees was
primarily the result of increased revenues.
Depreciation and amortization costs increased by 8.0% to Ps. 487.7 million in 2006 from Ps.
451.6 million in 2005. This increase was principally due to the capitalization of investments in
fixed assets and improvements made to concession assets.
Operating income decreased 0.3% to Ps.829.6 million in 2006 from Ps. 831.7 million in 2005.
This decline in operating income was primarily a result of the fact that our 4.3% increase in
revenues did not fully offset the increase in total operating expenses of 7.1%.
Operating income for Cancun Airport increased by 3.9% to Ps. 810.4 million in 2006 from Ps.
780.2 million in 2005. Our eight other airports, on an aggregate basis, reported operating income
of Ps. 17.3 million in 2006 compared to operating income of Ps. 53.4 million in 2005. During 2006,
revenues and passenger traffic volume in those eight airports increased 8.2% and 0.8%,
respectively, from 2005. The increase in revenues largely resulted from the increase in
non-aeronautical revenues.
Comprehensive Financing Result
Our net comprehensive financing result decreased to income of Ps. 15.2 million in 2006 as
compared to income of Ps. 23.6 million in 2005, primarily due to a greater loss on monetary
position in 2006, which was offset in part by a change from a foreign exchange loss in 2005 to a
foreign exchange gain in 2006.
Income Taxes, Employees Statutory Profit Sharing and Asset Tax
Our provision for income taxes, asset tax and employees statutory profit sharing (all of
which represented deferred income and asset taxes and deferred employees statutory profit sharing)
increased by 15.8% to Ps. 301.1 million in 2006 from Ps. 260.1 million in 2005, primarily due to
the increase in our revenues in 2006.
Net Income
Net income declined to Ps. 528.1 million in 2006 from Ps. 586.0 million in 2005. This was
mainly the result of the increase in expenses, which were not fully offset by the increase in
revenues for the year.
Results of operations for the year ended December 31, 2005 compared to the year ended December 31,
2004
Revenues
Total revenues for 2005 were Ps. 2,147.4 million, 1.1% higher than the Ps. 2,124.5 million
recorded in 2004. The increase in total revenues resulted primarily from an increase of 20.2% in
revenues from non-aeronautical services.
76
Our revenues from aeronautical services, net of rebates, decreased 5.1% to Ps. 1,520.2 million
in 2005 from Ps. 1,602.6 million in 2004, due primarily to the 5.4% decrease in international
passengers attributable to the impacts of Hurricanes Wilma and Emily on the passenger volumes of
the Cancun and Cozumel airports during the second half of the year. Revenues from passenger
charges decreased 5.1% to Ps. 1,216.5 million in 2005 (80.0% of our aeronautical revenues during
the period) from Ps. 1,281.6 million in 2004 (80.0% of our aeronautical revenues during the
period).
Revenues from non-aeronautical services increased 20.2% to Ps. 627.3 million in 2005 from Ps.
521.9 million in 2004, principally due to an increase in commercial revenues. This increase was
primarily the result of a 42.3% increase in duty-free revenues, principally due to rent payments of
Ps. 7.3 million in May and Ps. 33.8 million in August by Dufry Mexico for units occupied in the
Cancun airport, as mandated by a ruling of the International Court of Arbitration in favor of ASUR,
as well as payment of Ps. 10.3 million from Aldeasa. The increase in revenues from
non-aeronautical services also resulted in part from an 18.6% increase in food and beverage
revenues from our direct commercial operations and a 23.6% increase in retail revenues derived from
three convenience stores we have operated directly since 2004 and 16 new convenience stores at the
Cancun, Cozumel, Villahermosa, Oaxaca and Minatitlan airports operated by new commercial tenants.
A 23.0% increase in revenues from parking lots, particularly at Villahermosa airport, and a 9.5%
rise in advertising revenue, resulting from selling advertising space directly rather than through
a third party, also contributed to the increase in revenues from non-aeronautical services. This
increase was partially offset by a 19.8% decrease in revenues from banking and currency exchange
services and a 6.9% decline in revenues from ground transportation.
Our revenues from regulated sources in 2005 were Ps. 1,601.7 million, a 4.3% decrease
compared to Ps. 1,673.6 million in 2004, mainly due to the decline in total passenger traffic of
4.1%. During 2005, Ps. 545.7 million of our revenues derived from non-regulated sources, a 21.0%
increase from the Ps. 450.9 million of revenues derived from non-regulated sources in 2004. This
increase was primarily due to the 18.8% increase in commercial revenues described above.
Operating Expenses and Operating Income
Total operating expenses were Ps. 1,315.6 million in 2005, a 7.5% increase from the Ps.
1,223.9 million recorded in 2004, primarily as a result of an 15.5% increase in cost of services, a
6.0% decrease in general and administrative expenses and a 1.1% increase in concession fees. These
sources of increased costs were partially offset by a 4.0% decrease in technical assistance fees.
As a percentage of total revenues, operating expenses increased to 61.3% of total revenues in 2005
from 57.6% of total revenues in 2004.
Cost of services increased 15.5% to Ps. 580.6 million in 2005 from Ps. 502.4 million in 2004.
The increase was principally due to costs related to our direct operation of two restaurants, a
snack bar and three convenience stores previously operated by commercial tenants. This increase in
costs of services also resulted from higher maintenance expenses, an increase in salaries to
unionized employees effective October 2005 and expenses associated with the evaluation of new
projects.
77
General and administrative expenses decreased 6.0% to Ps. 106.8 million in 2005 from Ps. 113.7
million in 2004. This increase was primarily attributable to an increase in fees paid to
consultants during the period.
Technical assistance fees decreased by 4.0% to Ps. 69.1 million in 2005 from Ps. 71.9 million
in 2004, and concession fees increased by 1.1% to Ps. 107.3 million in 2005 from Ps. 106.1 million
in 2004. The technical assistance fees decreased in 2005 due to the corresponding decline in
EBITDA (a factor in the calculation of the fee) during the period. The increase in concession fees
was primarily the result of increased revenues.
Depreciation and amortization costs increased by 5.1% to Ps. 451.6 million in 2005 from Ps.
429.5 million in 2004. This increase was principally due to the capitalization of investments in
fixed assets and improvements made to concession assets.
Operating income decreased 7.6% to Ps. 831.7 million in 2005 from Ps. 900.6 million in 2004.
This decline in operating income was primarily a result of the fact that our 1.1% increase in
revenues did not offset the increase in expenses of 7.6%.
Operating income for Cancun Airport decreased by 8.9% to Ps. 780.2 million in 2005 from Ps.
851.6 million in 2004. Our eight other airports, on an aggregate basis, reported operating income
of Ps. 53.4 million in 2005 compared to operating income of Ps. 33.6 million in 2004. During 2005,
revenues and passenger traffic volume in those eight airports increased 11.2% and 3.4%,
respectively, from 2004. The increase in revenues resulted from the increase in non-aeronautical
revenues.
Comprehensive Financing Result
Our net comprehensive financing result changed to an income of Ps. 23.6 million in 2005 as
compared to an expense of Ps. 30.9 million in 2004, primarily due to higher interest income in 2005
(reflecting our higher cash balances).
Income Taxes, Employees Statutory Profit Sharing and Asset Tax
Our provision for income taxes, asset tax and employees statutory profit sharing (all of
which represented deferred income and asset taxes and deferred employees statutory profit sharing)
increased by 31.3% to Ps. 260.1 million in 2005 from Ps. 198.0 million in 2004, primarily due to a
Ps. 122.4 million tax benefit recognized in 2004 resulting from the reduction in income tax rate
last year as a result of amendments to the Income Tax Law.
Net Income
Net income declined to Ps. 586.0 million in 2005 from Ps. 652.6 million in 2004, reflecting
the decline in revenues resulting from the impact of Hurricanes Emily and Wilma in July and October
2005, respectively.
78
Liquidity and Capital Resources
Our
operations, financing and investing activities are funded through cash flow from operations.
The cash flow generated from our operations has generally been used to cover operating expenses
and capital expenditures, to make dividend payments and to increase our cash balances. In addition, in 2006, 2005 and 2004
we used Ps. 211 million, Ps. 200 million and Ps. 190 million, respectively, to pay dividends. At
December 31, 2006, we had Ps. 1,241.70 million in cash and marketable securities.
In 2006, we generated Ps. 1,031.6 million in resources from operating activities. Our
resources used in financing activities were Ps. 296.7 million, as a result of payment of dividends
of Ps. 210.7 million and Ps. 86.0 million of tax on dividends paid, partially offset by recovered
income tax on dividends paid in previous years. Our resources used in investing activities in 2006
were Ps. 1,088.9 million for the construction of the Terminal 3 building at Cancun Airport, which
is expected to begin operation by the end of 2007.
In 2005, we generated Ps. 1,288.5 million in resources from operating activities. Our
resources used in financing activities were Ps. 285.7 million, as a result of payment of dividends
of Ps. 200.0 million and Ps. 85.7 million of tax on dividends paid. Our resources used in
investing activities in 2005 were Ps. 657.8 million for purchases of machinery, furniture and
equipment principally for the Cancun, Villahermosa and Merida airports.
In 2004, we generated Ps. 1,207.2 million in resources from operating activities. Our
resources used in financing activities were Ps. 233.5 million, reflecting payment of dividends of
Ps. 190.0 million and Ps. 69.4 million of tax on dividends paid, partially offset by recovered
income tax on dividends paid in previous years. Our resources used in investing activities in 2004
were Ps. 526.4 million for purchases of machinery, furniture and equipment principally for the
Cancun, Huatulco and Veracruz airports.
Under the terms of our concessions, every five years our subsidiary concession holders must
present a master development plan to the Ministry of Communications and Transportation for
approval. Each master development plan includes concession holders investment commitments for the
succeeding five-year period, including capital expenditures and improvements. Once approved by the
Ministry of Communications and Transportation, these commitments become binding obligations under
the terms of our concessions. On December 30, 2003, the Ministry of Communications and
Transportation approved each of our master development plans. The current terms of the master
development plans went into effect on January 1, 2004 and will be in effect until December 31,
2008.
The following table sets forth our committed investments for our airports pursuant to the
terms of our current master development plans for the periods indicated. There can be no assurance
as to the level of committed investments we will be required to undertake under future master
development plans. Even though we have committed to invest the amounts in the table below, these
amounts could ultimately be higher or lower depending on future project costs.
79
Committed Investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
2007 |
|
|
2008 |
|
|
Total |
|
|
|
(thousands of pesos)(1) |
|
Cancun(2) |
|
Ps. |
334,960 |
|
|
Ps. |
432,206 |
|
|
Ps. |
847,797 |
|
|
Ps. |
1,052,919 |
|
|
Ps. |
83,298 |
|
|
Ps. |
2,751,180 |
|
Merida |
|
|
25,184 |
|
|
|
27,710 |
|
|
|
46,255 |
|
|
|
31,188 |
|
|
|
2,321 |
|
|
|
132,658 |
|
Cozumel |
|
|
10,598 |
|
|
|
68,984 |
|
|
|
12,442 |
|
|
|
16,280 |
|
|
|
10,828 |
|
|
|
119,132 |
|
Villahermosa |
|
|
47,407 |
|
|
|
63,602 |
|
|
|
6,360 |
|
|
|
11,892 |
|
|
|
1,303 |
|
|
|
130,564 |
|
Oaxaca |
|
|
21,502 |
|
|
|
21,150 |
|
|
|
10,257 |
|
|
|
6,624 |
|
|
|
4,829 |
|
|
|
64,362 |
|
Veracruz |
|
|
25,161 |
|
|
|
21,287 |
|
|
|
11,616 |
|
|
|
11,205 |
|
|
|
1,496 |
|
|
|
70,765 |
|
Huatulco |
|
|
9,820 |
|
|
|
5,450 |
|
|
|
3,990 |
|
|
|
6,816 |
|
|
|
52,560 |
|
|
|
78,636 |
|
Tapachula |
|
|
20,202 |
|
|
|
4,447 |
|
|
|
9,217 |
|
|
|
8,158 |
|
|
|
801 |
|
|
|
42,825 |
|
Minatitlan |
|
|
10,559 |
|
|
|
6,156 |
|
|
|
4,838 |
|
|
|
2,023 |
|
|
|
3,062 |
|
|
|
26,638 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
505,393 |
|
|
Ps. |
650,992 |
|
|
Ps. |
952,772 |
|
|
Ps. |
1,147,105 |
|
|
Ps. |
160,498 |
|
|
Ps. |
3,416,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Expressed in constant pesos with purchasing power as of December 31, 2006 based on the
Mexican construction price index in accordance with the terms of our master development plan. |
|
(2) |
|
The master development plan for Cancun airport was modified in the fourth quarter of 2005 to
reflect our decision to build a new terminal rather than implement extensive expansion and
remodeling of existing terminals, and to reflect an accelerated timetable for the construction
of a second runway once the necessary land is received from the government. The Ministry of
Communications and Transportation approved the modified plan and recognized Ps. 1,433 million
in investments as of December 31, 2006. |
The following table sets forth our historical investments in the periods indicated.
Capital Expenditures
|
|
|
|
|
Year ended December 31, |
|
(thousands of pesos)(1) |
2004 |
|
Ps. |
442,937 |
|
2005 |
|
|
715,010 |
|
2006(2) |
|
|
1,040,633 |
|
|
|
|
(1) |
|
Expressed in constant pesos with purchasing power as of December 31, 2006. |
(2) |
|
Does not include the Ps. 48.3 million in connection with
the re-opening of Terminal 1 at the Cancun airport. |
Although we currently intend to fund the investments and working capital required by our
business strategy through cash flow from operations, we may incur debt to finance all or a portion
of these investments in the future.
Mexican aviation authorities recently adopted International Civil Aviation Organization
guidelines requiring checked baggage on all international commercial flights to undergo a new
comprehensive screening process beginning in January 2006. As of January 2006, we implemented a
new screening system for all departing international flights, and we implemented the same system
for domestic flights as of July 1, 2006. Although airlines, rather than holders of airport
concessions, are responsible for baggage screening under Mexican law, we decided to purchase,
install and operate the new screening equipment to facilitate their compliance with the new policy.
This could potentially expose us to liability relating to the purchase, installation and operation
of the equipment, or require us to purchase, install and operate additional equipment, if, among
other things, the new screening procedures failed to detect or intercept any attempted terrorist
activities at our airports.
80
Critical Accounting Policies
The preparation of our financial statements requires that we make estimates and assumptions
that affect the reported amount of assets and liabilities, disclosure of contingent assets and
liabilities at the date of our financial statements and the reported amounts of revenue and
expenses generated during the reporting period. There can be no assurance that actual results will
not differ from those estimates and assumptions. The impact and any associated risks related to
such policies on our business operations are addressed where such policies affect our reported and
expected financial results throughout our discussion of our results of operations. Critical
accounting policies are defined as those that are both important to the portrayal of our financial
condition and results of operations and which require us to exercise significant judgment. Our
most critical accounting policies are described briefly below. For a detailed discussion of the
application of these and other accounting policies, see Notes 2 and 16 of our financial statements.
Revenue Recognition
Revenues are obtained from aeronautical services, which generally relate to the use of airport
infrastructure by air carriers and passengers, and from non-aeronautical services.
Aeronautical services revenues consist of passenger charges for departing passengers
(excluding diplomats, infants, and transfer and transit passengers), landing charges based on the
average between aircrafts maximum takeoff weight and the zero-fuel weight and hour of arrival,
aircraft parking charges based on the time an aircraft is on the ground and hour of arrival,
passenger walkway charges for the connection of aircraft to terminals, based on hour of arrival,
and airport security charges for departing passengers. Aeronautical services revenue is recognized
as passengers depart, at the time of landings and as services are provided, as the case may be.
Non-aeronautical service revenues consist primarily of the leasing of space in airport
terminals, access fees from third parties providing handling, catering and other services at the
airports and miscellaneous other revenues.
Rental income is recognized on terminal space that is leased through operating leases. Such
leases stipulate either: (i) fixed monthly rental fees (ii) fees based on the greater of a minimum
monthly rental fee, a specified percentage of the lessees monthly revenues or the number of
departing passengers. Access fees and other service revenues are recognized as services are
provided. All amounts are calculated and recognized on a monthly basis.
Under the Airport Law and its regulations, ASURs revenues are classified as Airport Services,
Complementary Services or Commercial Services. Airport Services consist primarily of the use of
runways, taxiways and aprons for landings and departures, aircraft parking, the use of passenger
walkways, security services, hangars, automobile parking facilities as well as the general use of
terminal space and other infrastructure by aircraft, passengers and cargo, including the lease of
space essential for the operation of airlines and complementary service providers. Complementary
Services consist primarily of ramp and handling services, catering, maintenance and repair, as well
as related activities to support air carriers. Revenues from access fees charged
81
to third parties providing complementary services are classified as Airport Services.
Commercial Services consist of services that are not considered essential to the operation of an
airport, such as the lease of space to retailers, restaurants and banks.
Allowance for Doubtful Accounts
We perform ongoing credit evaluations of our customers and adjust credit limits based upon the
customers payment history and current creditworthiness. We continuously monitor collections and
payments from our customers and maintain a provision for estimated credit losses based upon our
historical experience and any specific customer collection issues that we have identified. Even
though these credit losses have historically been within our expectations and we have an
established allowance to provide for losses, we cannot guarantee that we will continue to
experience the same credit loss rates that we have in the past. Since our accounts receivable are
concentrated in the hands of a few large customers, a significant change in the liquidity or
financial position of any one of these customers could have a material adverse impact on the
collection of our accounts receivables and our future operating results.
Valuation of Rights to Use Airport Facilities and Airport Concessions
We periodically review the carrying value of our rights to use airport facilities and airport
concessions. This review is based on our projections of anticipated discounted future cash flows
over the life of our assets or concessions, as appropriate. Since our airport concessions expire
in 2048, significant management judgment is required to estimate these future cash flows. While we
believe that our estimates of future cash flows are reasonable, different assumptions about such
cash flows could materially affect our evaluations including assumptions concerning passenger
traffic, changes in rates, inflation and operating costs. Additionally, in analyzing the carrying
value of our airport concessions, we compare the aggregate carrying value of all nine of our
airport concessions to the net cash flows derived from all of the airports, as we are not permitted
to dispose of or cease operating any individual airport. The aggregate net cash flows from all of
our airports exceeds the carrying value of the airport concessions. Accordingly, because we
analyze our valuation estimates on an aggregate level, we have not recognized any impairment loss
in the carrying value of an individual airport concession where the carrying value of the
individual airport concession exceeds the net cash flows of that airport.
Deferred Income Tax, Employees Statutory Profit Sharing and Asset Tax
Our income tax expense, employees statutory profit sharing and asset tax is comprised of
current expenses and deferred expenses. Deferred income tax
represents the tax effects of temporary differences generated from the differences in the accounting
and tax treatment of balance sheet items, such as our airport concessions, rights to use airport
facilities and from non-balance sheet items such as tax loss carry-forwards and credits. Deferred
employees statutory profit sharing is calculated in a similar manner. These temporary differences
and tax loss carry-forwards and credits are accounted for as deferred tax assets or liabilities on
our balance sheet. The corresponding difference between the beginning and year-end balances of
the recognized deferred tax assets and liabilities is recorded in earnings. Asset tax is a minimum
tax that is calculated as 1.8% of the average tax value of virtually all of our assets less the
average tax value of certain liabilities. In 2006, we were subject to the asset
82
tax, which can be credited against future taxable income for a period of ten years. A company
may credit the asset tax against taxable income when it generates taxable income. Deferred tax
assets, deferred employees statutory profit sharing assets and recoverable asset tax are not
subject to valuation allowances if we estimate that there is a high probability that the assets
will be realized. We have analyzed each airport on an individual basis and have recognized
valuation allowances against deferred tax assets, deferred employees statutory profit sharing and
recoverable asset tax for some of our airport subsidiaries where
taxable income is not expected in the near future. We have not recognized valuation
allowances against tax loss carry-forwards generated by our other
airport subsidiaries, whereby taxable profits are expected, because each
is taxed on an individual basis and under current tax law these tax carry-forwards can be carried
forward through the term of the airport concessions or a period of ten years. As our airport
concessions expire in 2048, significant management judgment concerning a number of factors,
including the number of passengers we anticipate in our airports, increases in rates and inflation;
changes in the discount rate and taxes is required in determining any valuation allowance.
Contingent Liabilities
We are a party to a number of legal proceedings. Under generally accepted accounting
principles, liabilities are recognized in the financial statements when a loss is both estimable
and probable. If the loss is neither probable nor estimable or if the likelihood of a loss is
remote, no amounts are recognized in the financial statements. Based on legal advice we have
received from our Mexican counsel and other information available to us, we have not recognized any
losses in the financial statements as a result of these proceedings.
Recently Issued Accounting Standards
Certain accounting standards, which were issued by the Mexican Institute of Public Accountants
(IMCP), went into effect on January 1, 2006. The adoption of these
standards has not and will not have a significant effect on our financial position or results of
operations.
As of June 1, 2004, the Mexican Council for the Investigation and Development of Financial
Reporting Standards (Consejo Mexicano para la Investigacion y Desarrollo de Normas de Informacion
Financiera or CINIF) assumed responsibility for accounting policy in Mexico. As part of this
responsibility, and following a process of analysis during the years 2004 and 2005, the CINIF
issued a series of Financial Reporting Regulations (Normas de Informacion Financiera or NIFs),
which became effective as of January 1, 2006.
The NIFs aim to standardize the local regulations used by the various sectors of the Mexican
economy and to bring convergence, to the extent possible, with International Financial Reporting
Standards (IFRS).
The elements of the NIF structure that are compulsory as of January 1, 2006 are as follows:
|
|
|
NIFs and NIF Interpretations issued by the CINIF; |
83
|
|
|
bulletins issued by the Accounting Principles Commission (Comision de Principios de
Contabilidad or CPC) of the IMCP that have not been modified, superseded or eliminated
by new NIFs; and |
|
|
|
|
applicable supplementary IFRSs. |
CPC circulars will continue to be recommendations and will continue to form part of NIFs until
they are rendered obsolete (that is, until they are eliminated or are no longer applicable as they
are covered by an NIF).
The following NIFs are not expected to have any wide-reaching implications for financial
reporting:
|
|
|
NIF A-1 Structure of Financial Reporting Regulations |
|
|
|
|
NIF A-2 Basic Precepts |
|
|
|
|
NIF A-3 User Needs and Objectives of Financial Statements |
|
|
|
|
NIF A-4 Qualitative Characteristics of Financial Statements |
|
|
|
|
NIF A-5 Basic Elements of Financial Statements |
|
|
|
|
NIF A-6 Recognition and Assessment |
|
|
|
|
NIF A-7 Presentation and Disclosure |
|
|
|
|
NIF A-8 Supplementary Nature |
|
|
|
|
NIF B-1 Accounting Changes and Correction of Errors |
|
|
|
|
NIF B-3 Income Statement |
|
|
|
|
NIF B-13 Subsequent Event |
|
|
|
|
NIF C-13 Related Parties |
|
|
|
|
NIF D-6 Capitalizations of the Financing Integral Result |
Differences between Mexican NIF and U.S. GAAP
Our financial statements are prepared in accordance with Mexican NIF, which differs in certain
respects from U.S. GAAP. See Note 16 to our financial statements. Net income under U.S. GAAP was
Ps. 267.2 million, Ps. 470.2 million and Ps. 416.0 for the years ended December 31, 2004, 2005 and
2006, respectively.
The principal differences between Mexican NIF and U.S. GAAP as they relate to us are deferred
income taxes, employees statutory profit sharing, tax on dividends paid, the treatment of our
investments in our concessions and the rights to use airport facilities, the contract termination
fee on leasehold agreements. Each of these differences affects both net income and stockholders
equity. See Note16 to our financial statements for a discussion of these differences and the
effect on our results of operation.
In February 2006, the FASB issued Statement of Financial Accounting Standards No. 155,
Accounting for Certain Hybrid Financial Instruments (SFAS 155). SFAS 155 permits fair value
measurement for any hybrid financial instrument that contains an embedded derivative that would
otherwise require bifurcation and separate accounting. An irrevocable election may be made at
inception to measure such a hybrid financial instrument at fair value, with changes in fair value
recognized through income. Such an election needs to be supported by concurrent
84
documentation. SFAS 155 is effective for fiscal years beginning after September 15, 2006,
with early adoption permitted. We are currently considering the impact that adoption will have on
our consolidated results and financial position.
In June 2006, the FASB issued FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty
in Income Taxes an interpretation of FASB Statement No. 109. FIN 48 clarifies the accounting for
uncertainty in income taxes by prescribing thresholds and attributes for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a tax return. The
interpretation also provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, and disclosure. FIN 48 is effective for fiscal years beginning
after December 15, 2006. ASUR is currently evaluating the impact of adopting FIN 48.
In June 2006, the EITF ratified the consensus on EITF Issue No. 06-3 (EITF 06-03), How Taxes
Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income
Statement (That Is, Gross versus Net Presentation). EITF 06-03 concluded that the presentation of
taxes assessed by a governmental authority that is directly imposed on a revenue-producing
transaction between a seller and a customer, such as sales, use, value-added and certain excise
taxes is an accounting policy decision that should be disclosed in a companys financial
statements. In addition, companies that record such taxes on a gross basis should disclose the
amounts of those taxes in interim and annual financial statements for each period for which an
income statement is presented if those amounts are significant. EITF 06-03 is effective for
interim and annual reporting periods beginning after December 15, 2006. ASUR does not anticipate
that the adoption of EITF 06-03 will have an impact on its financial condition or results of
operations.
In September 2006, the FASB issued SFAS No. 157 (SFAS 157), Fair Value Measurements. This
statement defines fair value, establishes a framework for measuring fair value in GAAP and expands
disclosures about fair value measurements. SFAS 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007. ASUR is currently evaluating the impact of
adopting SFAS 157 on its financial condition and results of operations.
In February 2007, the FASB issued SFAS No. 159 (SFAS 159), The Fair Value Option for Financial
Assets and Financial Liabilities including an amendment of FASB Statement No.115. This Statement
permits entities to choose to measure many financial instruments and certain other items at fair
value at specified election dates. SFAS 159 provides entities with the opportunity to mitigate the
volatility in reported earnings caused by measuring related assets and liabilities differently
without having to apply complex hedge accounting provisions. This Statement is effective as of the
beginning of an entitys first fiscal year beginning after November 15, 2007. Early adoption is
permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided
the entity also elects to apply the provisions of FASB Statement No. 157, Fair Value Measurements.
The Company is currently evaluating the impact of adopting SFAS 159 on its financial condition and
results of operations.
85
Off-balance sheet arrangements
We are not party to any off-balance sheet arrangements, nor have we been involved in any such
transactions in the past.
Tabular disclosure of contractual obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments due by period (in millions of pesos) |
|
|
|
|
|
|
|
Less than 1 |
|
|
|
|
|
|
|
|
|
|
More than |
|
Contractual Obligations |
|
Total |
|
|
year |
|
|
1-3 years |
|
|
3-5 years |
|
|
5 years |
|
Master Development Plan |
|
Ps. |
1,308.0 |
|
|
Ps. |
1,147 |
|
|
Ps. |
161 |
|
|
|
|
|
|
|
|
|
|
Purchase Obligations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Lease Obligations |
|
|
8 |
|
|
|
8 |
|
|
|
1 |
|
|
|
|
|
|
|
|
|
Technical Assistance Agreement(1) |
|
|
71 |
|
|
|
71 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital (Finance) Lease Obligations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-Term Debt Obligations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
1,387 |
|
|
Ps. |
1,225 |
|
|
Ps. |
162 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Reflects fixed minimum amount due under the Technical Assistance Agreement. Actual amount to
be paid in any year may be higher because technical assistance fees are calculated as the
greater of a fixed dollar amount (subject to certain adjustments) and 5% of our annual
consolidated earnings before comprehensive financing cost, income taxes and depreciation and
amortization (determined in accordance with Mexican NIF and calculated prior to deducting the
technical assistance fee). |
Item 6. Directors, Senior Management and Employees
Directors
Our board of directors is responsible for the management of our business. Pursuant to our
bylaws, the board of directors must consist of an uneven number of directors determined at an
ordinary general meeting of stockholders and is required to have at least seven, but not more than
twenty-one, members. Currently, the board of directors consists of seven directors, each of whom
is elected at the annual stockholders meeting for a term of one year or until a successor has been
appointed.
Our bylaws provide that the holders of Series BB shares are entitled to elect two members and
their alternates to the board of directors. Our remaining directors are elected by the holders of
our Series B shares. Under our bylaws, each stockholder or group of stockholders owning at least
10% of our capital stock in the form of Series B shares is entitled to elect one member to the
board of directors for each 10% interest that it owns. The other directors to be elected by the
holders of our Series B shares are elected by majority vote of all holders of Series B shares
present at the stockholders meeting (including stockholders that individually or as part of a
group elected a director as a result of their 10% stake). On February 28, 2001 the stockholders
voted to eliminate alternate members of the board of directors with respect to those directors
elected by holders of Series B shares.
86
The following table lists our directors as of the date of this annual report, their title and
date of appointment:
|
|
|
|
|
Name |
|
Title |
|
Director Since |
Fernando Chico Pardo(1)
|
|
Director and Chairman |
|
April 28, 2005 |
|
|
(also Chief Executive Officer)
|
|
|
Ricardo Guajardo Touche(3)
|
|
Director
|
|
February 28, 2001 |
Francisco Garza Zambrano(3)
|
|
Director
|
|
February 28, 2001 |
George J. Vojta(3)
|
|
Director
|
|
April 28, 2003 |
Valentin Diez Morodo(3)
|
|
Director
|
|
April 28, 2005 |
Alejandro Soberon Kuri(3)
|
|
Director
|
|
April 27, 2006 |
Rasmus Christiansen(2)
|
|
Director
|
|
April 27, 2007 |
|
|
|
(1) |
|
Elected by ITA as holder of Series BB shares, with Luis Chico Pardo as Alternate. |
|
(2) |
|
Elected by ITA as holder of Series BB shares, with
Torben Thyregod as Alternate. |
|
(3) |
|
Independent Director. |
Fernando Chico Pardo. Mr. Chico Pardo is a member of our board of directors, Chairman of the
Board since April 28, 2005 and our Chief Executive Officer since January 19, 2007. He is the
founder and President of Promecap, S.C. since 1997. Previously, Mr. Chico Pardo was the Partner
and Chief Executive Officer of Grupo Financiero Inbursa, S.A. de C.V., Partner and Chief Executive
Officer of Acciones e Inversora Bursatil, S.A. de C.V. Casa de Bolsa, founder and Chairman of
Acciones y Asesoria Bursatil, S.A. de C.V. Casa de Bolsa, Director of Metals Procurement at Salomon
Brothers (New York) and the Latin America Representative for Mocatta Metals Corporation and the
Mexico Representative for Standard Chartered Bank (London).
Mr. Chico Pardo is a member of
the board of directors of, among others, Grupo Financiero Inbursa, Grupo Carso, Sanborns Hermanos, Sears
Roebuck de Mexico and Grupo Posadas. He is 55 years old. Mr. Chico Pardo was appointed
by ITA.
Ricardo Guajardo Touche. Mr. Guajardo is a member of our board of directors. He was President of
Grupo Financiero BBVA Bancomer, S.A. from 2000 to 2004, a President and General Director of Grupo
Financiero BBVA Bancomer, S.A. from 1991 to 2000 and General Director of Grupo Vamsa since 1989.
He is presently a member of the board of directors of Grupo Bimbo and Almacenes Coppel, and has
served on the board of directors of Instituto Tecnologico y de Estudios Superiores de Monterrey
(ITESM), Fomento Economico Mexicano (FEMSA), Grupo Valores de Monterrey (VAMSA), Transportacion
Maritima Mexicana (TMM), Alfa and El Puerto de Liverpool. He is 59 years old. Mr. Guajardo is an
independent director.
Francisco Garza Zambrano. Mr. Garza is a member of our board of directors and he has served as
President of Cementos Mexicanos of Norteamerica y Trading (his current position), as President of
Cementos Mexicanos Mexico, as President of Cementos Mexicanos Panama, as President of Cementos
Mexicanos Venezuela and as President of Cementos Mexicanos E.U.A. He was formerly on the board of
directors of Control Administrativo Mexicano S.A. de C.V., Vitro Plano, S.A. de C.V., Universidad
de Monterrey, Camara Nacional del Cemento (CANACEM), Club Industrial, A.C. and Fundacion Mexicana
para la Salud. He is 52 years old. Mr. Garza is an independent director.
87
George Vojta. Mr. Vojta is a member of our board of directors and has been President and Director
of the Financial Services Forum since 1999. Previously, Mr. Vojta was Vice Chairman of the Board
of Bankers Trust, President of Deak & Company, Chief Financial Officer of Phibro-Salomon, Inc. and
Deputy Vice Chairman of Citigroup. Mr. Vojta is currently Chief Executive Officer of the
Westchester Group LLC, Chairman of Wharton Financial Institutions Center and the Yale Center for
Corporate Governance and Performance. He is 71 years old. Mr. Vojta is an independent director.
Alejandro Soberon Kuri. Mr. Soberon is the founder of Corporacion Interamericana de
Entretenimiento, S.A. de C.V., or CIE, and has been Chairman of the Board and Executive President
of the group since it was established in 1990. Prior to the foundation of CIE, Mr. Soberon produced
films for more than 10 years through a series of Mexican companies where he was a founding
stockholder. Mr. Soberon was a member of the Board of Directors of Telefonos de Mexico, S.A. de
C.V., or Telmex, and is currently a member of the Board of Directors of America Movil, S.A. de
C.V., a company that was spun off from Telmex in September 2000. Additionally, he is a board
member of the Mexican Stock Exchange, and a member of the Board of Directors of Banco Nacional de
Mexico, S.A. de C.V. Mr. Soberon received a Bachelors Degree in Business Administration from the
Universidad Iberoamericana. He is 47 years old. Mr. Soberon is an independent director.
Valentin Diez Morodo. Mr. Diez is a member of our board of directors and currently serves as
Chairman of the Board of the Mexican Business Council for Foreign Trade, Investment and Technology
(COMCE). He is also the President of the Mexico-Spain Bilateral Business Committee at COMCE. In
addition, Mr. Diez serves on the board of Grupo Financiero Banamex, S.A. de C.V., International
Advisory Board of Citigroup, Inc., Acciones y Valores Banamex, S.A. de C.V., Kimberly Clark Mexico,
S.A. de C.V., Grupo ALFA, S.A. de C.V., DESC, S.A. de C.V., Grupo Mexico, S.A. de C.V., Grupo
Modelo, S.A. de C.V., Grupo MVS Multivision, Avantel, S.A., Zara Mexico, S.A. de C.V.,
International Advisory Board of Instituto de Empresa, Madrid and Banco Nacional de Comercio
Exterior (Banamex). Previously, Mr. Diez served as Vice President and General Director of Sales
and Exports of Grupo Modelo, S.A. de C.V. He is 67 years old. Mr. Diez is an independent
director.
Rasmus Christiansen. Mr. Christiansen is a member of our board of directors and currently serves
as Chief Executive Officer of Copenhagen Airports International A/S. Previously, Mr. Christiansen
served as Vice President of Copenhagen Airports International A/S, Director, Development &
Acquisitions of Copenhagen Airports International A/S, Director and owner of an import/export
company in Hungary, Vice President of Dolce International, International Hotel Development &
Operations, Chief Executive Officer of Scanticon Conference Center, Aarhus and Director of Sales of
Scanticon Conference Center, Aarhus. He is 55 years old.
Senior Management
Pursuant to our bylaws, the holders of Series BB shares are entitled to present the board of
directors the name or names of the candidates for appointment as chief executive officer, to remove
our chief executive officer and to appoint and remove one half of the executive officers.
88
Currently, four executive officers report directly to the chief executive officer, one of whom
was appointed by ITA as holder of the BB shares.
Since 2003, the duties of Director of Operations have been divided into two positions.
Currently, Hector Navarrete Munoz is serving in the role of Regional Director of Operations and
Gabriel Gurmendez Armand-Ugon is serving in the role of Director of Cancun Airport.
The following table lists our executive officers, their current position and their year of
appointment as an executive officer:
|
|
|
|
|
Name |
|
Principal Occupation |
|
Executive Officer since |
Fernando Chico Pardo*
|
|
Chief Executive Officer
Director of Finance
|
|
January 19, 2007 |
Adolfo Castro Rivas*
|
|
(chief financial officer)
|
|
January 24, 2000 |
Gabriel Gurmendez Armand-Ugon
|
|
Director of Cancun Airport
|
|
November 20, 2004 |
Hector Navarrete Muñoz
|
|
Regional Director of Operations
|
|
January 15, 2003 |
Claudio Gongora Morales
|
|
General Counsel
|
|
April 19, 1999 |
Manuel Gutierrez Sola
|
|
Chief Commercial Officer
|
|
August 7, 2003 |
|
|
|
* |
|
Appointed by ITA, as holder of Series BB shares. |
Fernando Chico Pardo. Mr. Chico Pardo is a member of our board of directors, Chairman of the
Board since April 28, 2005 and our Chief Executive Officer since January 19, 2007. He is the
founder and President of Promecap, S.C. since 1997. Previously, Mr. Chico Pardo was the Partner
and Chief Executive Officer of Grupo Financiero Inbursa, S.A. de C.V., Partner and Chief Executive
Officer of Acciones e Inversora Bursatil, S.A. de C.V. Casa de Bolsa, founder and Chairman of
Acciones y Asesoria Bursatil, S.A. de C.V. Casa de Bolsa, Director of Metals Procurement at Salomon
Brothers (New York) and the Latin America Representative for Mocatta Metals Corporation and the
Mexico Representative for Standard Chartered Bank (London).
Mr. Chico Pardo is a member of
the board of directors of, among others, Grupo Financiero Inbursa, Grupo Carso, Sanborns Hermanos, Sears
Roebuck de Mexico and Grupo Posadas. He is 55 years old. Mr. Chico Pardo was appointed
by ITA.
Adolfo Castro Rivas. Mr. Castro has been our Director of Finance since January 2000. Prior to
joining ASUR, Mr. Castro was Director of Finance and Administration of Ferrocarril del Sureste S.A.
de C.V. Mr. Castro was also Chief Financial Officer of Netcapital, S.A. de C.V., Director of
Finance of Grupo Mexicano de Desarrollo, S.A. de C.V., Finance Manager of Grupo ICA S.A.B. and an
auditor and consultant with Coopers & Lybrand. He is 43 years old.
Gabriel Gurmendez Armand-Ugon. Mr. Gurmendez has been the Director of Cancun International Airport
since November 2004. Previously, Mr. Gurmendez was the Minister of Transportation and Public Works
and the President and Director of ANTEL, the national telecommunications company of Uruguay. Mr.
Gurmendez has served as the General Manager of Consorcio Aeropuertos Internacionales S.A., the
private concessionaire of the International Airport of Punta del Este, Uruguay. He also acted as
interim President of Uruguays national oil company, ANCAP, the national railway, AFE, and the
national waterworks company, OSE. He is 45 years old.
89
Hector Navarrete Muñoz. Mr. Navarrete is the Regional Director of Airports. Previously, Mr.
Navarrete was the Administrator of the Merida International Airport, Director of the Board of
Culture and Tourism of the State of Yucatan and Coordinator of the Mayan Cultural Project in San
Antonio, Texas. He is 50 years old.
Claudio Gongora Morales. Mr. Gongora has been General Counsel since April 25, 2001. Previously,
he was Sub-Director of ASUR (starting on April 19, 1999). Mr. Gongora also served as Legal
Director of Azufrera Panamericana, S.A. de C.V., alternating as Legal Advisor for Compania
Exploradora del Istmo, S.A. de C.V. He has been Legal Sub-Director of Comision de Fomento Minero,
Legal Chief Consultant for Grafito de Mexico, S.A. de C.V., Terrenos para Industrias, S.A. de C.V.,
Terrenos de Jaltipan, S.A. de C.V., Macocozac, S.A. de C.V., Pasco Terminals, Inc. and Pasco
International, Ltd. He is 55 years old.
Manuel Gutierrez Sola. Mr. Gutierrez has been our Chief Commercial Officer since August 7, 2003.
Previously, since October 31, 2002, Mr. Gutierrez was our Acting Chief Commercial Officer, in
charge of the negotiations of the commercial contracts for our airports and the implementation of
the second stage of ASURs commercial strategy. Before that, he was our Concessions Manager since
December 2000. Prior to joining ASUR, Mr. Gutierrez was Chief Operations Officer of G. Accion S.A.
de C.V. and Machinery and Equipment Manager of Gutsa Construcciones, S.A. de C.V. He is 44 years
old.
Share Ownership of Directors and Senior Management
With the exception of Fernando Chico Pardo (see Item 7. Major Shareholders and Related Party
TransactionsMajor Shareholders), Luis Chico Pardo and Francisco Garza Zambrano, directors and
senior management do not own shares of ASUR. There are no compensation arrangements under which
employees may acquire capital of ASUR.
Compensation of Directors and Senior Management
Directors received Ps. 5.06 million in aggregate compensation for the year ended December 31,
2006. We paid an aggregate amount of approximately Ps. 16.8 million for the services of our
executive officers, which included payments to Copenhagen Airports for the services of Kjeld
Binger as our chief executive officer, who resigned his position effective as of December 31, 2006.
This contract was cancelled and on February 14, 2007, the Company signed a new agreement with
Promecap, S.C. to pay for the services of Fernando Chico Pardo.
No amount has been set aside by ASUR or its subsidiaries for pension, retirement or similar
benefits.
Committees
Our bylaws provide for four committees to assist the board of directors with the management of
our business: an Operating Committee, an Audit Committee, an Acquisitions and Contracts Committee
and a Nominations and Compensation Committee.
The Operating Committee, which is composed of four members, is responsible for proposing and
approving certain plans and policies relating to our business, investments and
90
administration, including approval of the master development plans of our subsidiary
concession holders, our dividend policy and investments of less than U.S.$2 million that are not
provided for in our annual budget. The board of directors appoints all the members of the
Operating Committee. Board members elected by the holders of Series BB shares have the right to
appoint two of the committee members and to appoint the chairman, who has a deciding vote in case
of a tie. The consent of the Series BB directors is also required to select the members of the
Operating Committee that are not members of our board or officers of our company. The current
members of the Operating Committee are Fernando Chico Pardo, Rasmus Christiansen, Ricardo Guajardo
and Francisco Garza Zambrano; the chairman position of the Operating Committee is vacant. A
secretary has also been appointed who is not a member of the committee.
The Audit Committee must be composed of at least three members, all of whom must be
independent, and is responsible for supervising the management and conduct of our business, as well
as monitoring the activities of our board of directors, our officers and the officers of our
subsidiaries for compliance with the bylaws and applicable law. With respect to financial
reporting and auditing matters, the Audit Committee has oversight of our internal auditing and
controls system, as well as the performance of our external auditors. The Audit Committee is also
responsible for monitoring transactions with affiliates, including ITA and its stockholders. Our
bylaws provide that the board of directors shall determine the number of members of the Audit
Committee, which is required to comprise solely independent directors. All members of the Audit
Committee must meet the applicable independence criteria set forth under the Sarbanes-Oxley Act of
2002 and the rules issued thereunder by the U.S. Securities and Exchange Commission. The president
of the Audit Committee is elected by a vote at the shareholders meeting, as is a secretary, who is
not required to be a committee member. The committee also appoints among its members a special
delegate who may not be a person appointed by the holders of Series BB shares nor be related to the
committee members. The special delegate is charged with ensuring that ITA complies with its
obligations under the technical assistance agreement it has with us. The current members of the
Audit Committee are Ricardo Guajardo Touche, Francisco Garza Zambrano and George Vojta (who serves
as our Audit Committee financial expert). A secretary has also been appointed who is not a member
of the committee.
The Acquisitions and Contracts Committee, composed of three members, is responsible for
ensuring compliance with our procurement policies set forth in our bylaws. Among other things,
these policies require that the Acquisitions and Contracts Committee approve any transaction or
series of related transactions between us and a third party involving consideration in excess of
U.S.$400,000 and that any contract between us, on the one hand, and ITA or any of its related
persons, on the other hand, be awarded pursuant to a bidding process involving at least three other
bidders. Our bylaws provide that a stockholders meeting will determine the number (which must be
an odd number) of members of the Acquisitions and Contracts Committee, which is required to be
composed primarily of members of the board of directors. The members of the board of directors
elected by the holders of Series BB shares are entitled to appoint one member to the committee.
The current members of the Acquisitions and Contracts Committee are Fernando Chico Pardo, Ricardo
Guajardo and Rasmus Christiansen; the chairman position of the Acquisitions and Contracts Committee
is vacant. A secretary has also been appointed who is not a member of the committee.
91
The Nominations and Compensation Committee was formed on October 12, 1999. The duties of the
committee include the proposal to the general shareholders meeting of candidates for election to
the board of directors and proposal to the board of directors of candidates for appointment as
executive officers, as well as proposals to the general shareholders meeting regarding the removal
and compensation of directors and officers. Our bylaws provide that a stockholders meeting will
determine the number (which must be an odd number) of members of the committee. The holders of the
Series B and Series BB shares, acting as a class, are each entitled to name one member of the
Nominations and Compensation Committee. The remaining members of the committee are to be named by
these two initial members. Members of the committee each have a term of one year. At each annual
shareholders meeting after a public offering of our shares, the Nominations and Compensation
Committee is required to present a list of at least seven candidates for election as directors for
the vote of the Series B stockholders. At an ordinary stockholders meeting held February 28,
2001, our stockholders resolved that the Nominations and Compensation Committee be comprised of
three members. The current members of the Nominations and Compensation Committee are Rasmus
Christiansen, Valentin Diez Morodo and Fernando Chico Pardo; one position remains open. A
secretary has also been appointed who is not a member of the committee.
NYSE Corporate Governance Comparison
Pursuant to Section 303A.11 of the Listed Company Manual of the New York Stock Exchange, we
are required to provide a summary of the significant ways in which our corporate governance
practices differ from those required for U.S. companies under the NYSE listing standards. We are a
Mexican corporation with shares listed on the Mexican Stock Exchange. Our corporate governance
practices are governed by our bylaws, the Securities Market Law and the regulations issued by the
Mexican National Banking and Securities Commission. We also generally comply on a voluntary basis
with the Mexican Code of Best Corporate Practices (Codigo de Mejores Practicas Corporativas) as
indicated below, which was created in January 2001 by a group of Mexican business leaders and was
endorsed by the Mexican Banking and Securities Commission. On an annual basis, we file a report
with the Mexican Banking and Securities Commission and the Mexican Stock Exchange regarding our
compliance with the Mexican Code of Best Corporate Practices.
On December 30, 2005, a new Mexican Securities Market Law was published in the Diario Oficial
de la Federacion, which became effective on June 28, 2006.
The table below discloses the significant differences between our corporate governance
practices and the NYSE standards.
|
|
|
NYSE Standards |
|
Our Corporate Governance Practice |
Director
Independence. Majority of board of directors must be independent.
§303A.01
|
|
Pursuant to the Mexican Securities Market Law, we are required to have a board of directors composed of a maximum
of 21 members, 25% of whom must be independent. Stockholders are required to make a determination as to the
independence of our directors. Our bylaws provide that our Board |
92
|
|
|
NYSE Standards |
|
Our Corporate Governance Practice |
|
|
|
of Directors must be composed of
such odd number
of members as determined by our shareholders at the annual meeting,
which shall not be less than seven and shall be subject to the
maximum limit set forth by the Mexican Securities Market Law. Currently, our board has seven members, of which five
are independent under the Sarbanes-Oxley Act of 2002 and as qualified by our shareholders as provided in the
Mexican Securities Market Law. |
|
|
|
|
|
The definition of independence applicable to us pursuant to the Mexican Securities Market Law differs in certain
respects from the definition applicable to U.S. issuers under the NYSE rules. |
|
|
|
Executive
Sessions. Non-management directors must meet regularly in executive sessions without management.
Independent directors should meet alone in an executive session at least once a year. §303A.03
|
|
Our non-management and independent directors are not required to meet in executive sessions and generally do not
do so. Executive sessions are not expressly recommended by the Mexican Code of Best Corporate Practices. |
|
|
|
|
|
None of our members of management are members of our Board of Directors nor our other committees, except for our
CEO, who is a member of the Board of Directors, the Operating Committee, the Acquisitions and Contracts Committee
and the Nominations and Compensation Committee. |
|
|
|
Audit
committee. Audit committee satisfying the independence and other requirements of Rule 10A-3 under the Exchange
Act and the more stringent requirements under the NYSE standards is
required. §§303A.06, 303A.07
|
|
We are in compliance with the independence requirements of Rule 10A-3, but the members of our Audit Committee are
not required to satisfy the NYSE independence and other audit committee standards that are not prescribed by Rule
10A-3. |
|
|
|
|
|
The principal characteristics of our Audit Committee are as follows: |
|
|
|
Our Audit Committee is composed of three members, all of whom are members of our board of
directors. |
|
|
|
|
All of the members of our Audit Committee and the committees president are independent. |
|
|
|
|
The Chairman of the Audit Committee is appointed and/or removed exclusively by the general
shareholders meeting. |
93
|
|
|
NYSE Standards |
|
Our Corporate Governance Practice |
|
|
|
Our Audit Committee operates pursuant to provisions in the Mexican Securities Market Law and our
bylaws. |
|
|
|
|
Our Audit Committee submits an annual report regarding its activities to our Board of Directors. |
|
|
|
|
The duties of our Audit Committee include, among others, the following: |
|
|
|
overseeing of our internal auditing and controls systems, |
|
|
|
|
appointing and removing, and supervising our external auditor and establishing the scope of
the external auditors duties and responsibilities, |
|
|
|
|
ensuring compliance with our bylaws by officers and directors of the company and its
subsidiaries, |
|
|
|
|
making recommendations to the Nomination and Compensation Committee with respect to the
removal of directors and officers for violations of the bylaws or any other applicable
legal provision, |
|
|
|
|
overseeing compliance with the corporate governance provisions as set forth in the General
Law of Business Companies (Ley General de Sociedades Mercantiles), and the Mexican
Securities Market Law and protection of minority shareholder rights, |
|
|
|
|
overseeing related-party transactions, and |
|
|
|
|
preparing certain regular reports for the board of directors
pursuant to the Mexican Securities Market Law and our bylaws. |
|
|
|
Nominating/corporate
governance and compensation committee. Nominating/corporate governance committee of
independent directors and compensation committee of independent directors are required. Compensation committee must
approve executive officer compensation. Each committee must have a
charter specifying the purpose, duties and evaluation procedures of
the committee. §303A.04 and §303A.05
|
|
Pursuant to the Mexican Securities Market Law, we are required to have a committee that performs corporate
governance functions (comite de practicas societarias). The board has vested all such functions and
responsibilities in our Audit Committee. |
|
|
The duties of our Audit Committee with |
94
|
|
|
NYSE Standards |
|
Our Corporate Governance Practice |
|
|
|
regard to corporate practices are, among others, the following: |
|
|
|
evaluating the performance of relevant officers, |
|
|
|
|
reviewing related-party transactions, and |
|
|
|
|
determining the total compensation package of the chief executive officer. |
|
|
|
|
|
We are not required to have a nominating or a compensation committee, but the Mexican Code of Best Corporate
Practices recommends that companies have an evaluation and compensation committee. Our bylaws provide for a
Nominations and Compensation Committee, which we believe carries out the principal duties of an evaluation and
compensation committee and a nominating/corporate governance committee. The duties of our Nomination and
Compensation Committee include, among others, the following: |
|
|
|
proposing individuals to serve as directors at the shareholders meeting, |
|
|
|
|
proposing individuals to serve as officers to the Board of Directors, |
|
|
|
|
proposing compensation for directors and officers at the shareholders meeting or to the Board
of Directors, as applicable, |
|
|
|
|
proposing for consideration at the shareholders meeting the removal of members of the Board of
Directors and officers, and |
|
|
|
|
submitting an annual report on its activities to the Board of Directors and the shareholders. |
|
|
|
|
|
Our Nomination and Compensation Committee is currently composed of three members who are appointed by the
shareholders at the shareholders meeting. Pursuant to our bylaws, at least one member is appointed by the Series
B shareholders and at least one member is appointed by the Series |
95
|
|
|
NYSE Standards |
|
Our Corporate Governance Practice |
|
|
|
BB shareholders. Our Nomination and
Compensation Committee is not required to be composed of independent
directors. |
|
|
|
Equity compensation plans. Equity compensation plans require shareholder approval, subject to limited exemptions.
|
|
Shareholder approval is not expressly required under our bylaws for the adoption and amendment of an
equity-compensation plan. No equity-compensation plans have been approved by our shareholders. |
|
|
|
Code of Ethics. Corporate governance guidelines and a code of business conduct and ethics is required, with
disclosure of any waiver for directors or executive officers. §303A.10
|
|
We have adopted a code of ethics applicable to all of our directors and executive officers, which is available to
you free of charge upon request and at www.asur.com.mx. We are required by Item 16B of Form 20-F to disclose any
waivers granted to our chief executive officer, chief financial officer and persons performing similar functions,
as well as to our other officers/employees. |
96
Employees
The following table sets forth the number of employees in various positions as of the end of
2003, 2004 and 2005.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
As of December 31, |
|
As of December 31, |
|
|
2004 |
|
2005 |
|
2006 |
Administrative Employees |
|
|
|
|
|
|
|
|
|
|
|
|
Servicios
Aeroportuarios
del Sureste, S.A.
de C.V. |
|
|
63 |
|
|
|
72 |
|
|
|
86 |
|
Cancun Airport |
|
|
114 |
|
|
|
149 |
|
|
|
193 |
|
Cozumel Airport |
|
|
10 |
|
|
|
19 |
|
|
|
19 |
|
Huatulco Airport |
|
|
14 |
|
|
|
18 |
|
|
|
19 |
|
Merida Airport |
|
|
34 |
|
|
|
44 |
|
|
|
43 |
|
Minatitlan Airport |
|
|
12 |
|
|
|
18 |
|
|
|
18 |
|
Oaxaca Airport |
|
|
12 |
|
|
|
20 |
|
|
|
22 |
|
Tapachula Airport |
|
|
17 |
|
|
|
21 |
|
|
|
21 |
|
Veracruz Airport |
|
|
19 |
|
|
|
25 |
|
|
|
25 |
|
Villahermosa Airport |
|
|
14 |
|
|
|
21 |
|
|
|
23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Administrative
Employees |
|
|
309 |
|
|
|
407 |
|
|
|
469 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unionized Employees |
|
|
|
|
|
|
|
|
|
|
|
|
Servicios
Aeroportuarios
del Sureste, S.A.
de C.V. |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Cancun Airport |
|
|
109 |
|
|
|
112 |
|
|
|
116 |
|
Cozumel Airport |
|
|
24 |
|
|
|
25 |
|
|
|
25 |
|
Huatulco Airport |
|
|
19 |
|
|
|
19 |
|
|
|
19 |
|
Merida Airport |
|
|
44 |
|
|
|
45 |
|
|
|
45 |
|
Minatitlan Airport |
|
|
16 |
|
|
|
16 |
|
|
|
16 |
|
Oaxaca Airport |
|
|
20 |
|
|
|
22 |
|
|
|
19 |
|
Tapachula Airport |
|
|
16 |
|
|
|
16 |
|
|
|
16 |
|
Veracruz Airport |
|
|
26 |
|
|
|
24 |
|
|
|
26 |
|
Villahermosa Airport |
|
|
27 |
|
|
|
27 |
|
|
|
29 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Union
Employees |
|
|
301 |
|
|
|
306 |
|
|
|
311 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2004, 2005 and 2006, we had approximately 610, 713 and 780 employees,
respectively. Of the 62 administrative employees added in 2006, 45 were hired mainly in
information technology, ASURs cargo division and in connection with the checked baggage screening
services we are providing for international flights as of January 1, 2006.
In addition, services relating to commercial operations, cargo, baggage screening and certain
airport operations are provided by third parties, using their own personnel. As of December
31,2006 there were approximately 135 employees providing such services.
Approximately 39.0% of our employees on December 31, 2006 were members of labor unions. A
significant portion of the services rendered in our airports is provided by personnel employed by
third parties. Approximately 15% of our employees are employed by Servicios Aeroportuarios del
Sureste, S.A. de C.V., a wholly-owned subsidiary that provides us with administrative and personnel
services, while the remainder, including all unionized personnel, are employed by our nine
subsidiary operating companies.
97
All of our unionized employees are members of local chapters of the Mexican National Union of
Airport Workers. Labor relations with our employees are governed by nine separate collective labor
agreements, each relating to one of our nine airports, and negotiated by the local chapter of the
union. As is typical in Mexico, wages are renegotiated every year, while other terms and
conditions of employment are renegotiated every two years. We began renegotiating our current
collective bargaining agreements with our unionized employees in August 2004 and reached final
agreements with the unions in October 2005. We believe that our relations with our employees are
good.
Item 7. Major Shareholders and Related Party Transactions
MAJOR SHAREHOLDERS
Tender Offer by Fernando Chico
Pardo
On May 14, 2007 Agrupacion Aeroportuaria Internacional II, S.A. de C.V.,
an entity indirectly owned and controlled by Fernando Chico Pardo, made a
tender offer for the purchase in Mexico and the United States of America of up
to 127,950,001 Series B shares (including Series B shares represented by ADSs),
representing approximately 42.65% of the outstanding capital stock of ASUR.
Thereafter, Agrupacion Aeroportuaria Internacional II, S.A. de C.V.,
resolved to waive the condition that it receive offers for at least 127,950,001
Series B shares and established that it would accept for purchase any number of
Series B shares (including Series B shares represented by ADSs) offered for
sale.
On June 22, 2007, Mr. Chico Pardo informed ASUR that the final aggregate
number of ADSs that had been offered and accepted for payment in the tender
offer in the United States of America was 2,867,302 ADSs (representing
28,673,020 Series B shares) and that the aggregate number of Series B shares
offered and accepted for payment in the Mexican tender offer was 7,762,515.
A total of 12.15% of the aggregate capital stock of ASUR was offered and
accepted for payment in the tender offer. The shares offered in the tender
offer include Series B shares and ADSs previously directly owned by Mr. Chico
Pardo and Copenhagen Airports.
In connection with the tender offers, on June 18, 2007, ITA, through
Bancomext, notified ASUR of its decision to convert 22,050,000 Series BB shares
into 22,050,000 Series B shares. ASUR was informed that these shares were
transferred to Agrupacion Aeroportuaria Internacional, S.A. de C.V., an entity
owned and controlled by Mr. Chico Pardo, as a result of a de-merger agreement
between Mr. Chico Pardo and Copenhagen Airports.
Capital Stock Structure
The
following table sets forth the current ownership of outstanding
shares as of June 25, 2007, to the extent of our knowledge.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of total |
|
|
Number of Shares |
|
share capital |
Identity of stockholder (1) |
|
B Shares |
|
BB Shares |
|
B Shares(3) |
|
BB Shares |
Agrupacion Aeroportuaria
Internacional II, S.A.
de
C.V. (2) |
|
|
36,435,535 |
|
|
|
|
|
|
|
12.15 |
% |
|
|
|
|
ITA, through
Bancomext (1)
(2) (3) (4) |
|
|
|
|
|
|
22,950,000 |
|
|
|
|
|
|
|
7.65 |
% |
Agrupacion Aeroportuaria
Internacional, S.A. de
C.V., through
Bancomext (1)
(2) (4) |
|
|
22,050,000 |
|
|
|
|
|
|
|
7.35 |
% |
|
|
|
|
Public |
|
|
218,564,465 |
|
|
|
|
|
|
|
72.85 |
% |
|
|
|
|
|
|
|
(1) |
|
Pursuant to the Share Registry Book of ASUR, the shareholders that
formally appear registered as such are (a) Indeval, as depositary of
255,000,000 Series B shares, (b) Bancomext, as holder of 22,050,000
Series B shares, and (c) Bancomext, as holder of 22,950,000 Series BB
shares. |
|
(2) |
|
Our CEO Fernando Chico Pardo owns, directly or indirectly,
(a) 51% of ITA, (b) 100% of Agrupación Aeroportuaria
Internacional II, S.A. de C.V., and (c) 100% of Agrupacion Aeroportuaria Internacional II, S.A.
de C.V. |
|
(3) |
|
Copenhagen Airports owns 49% of the capital stock of ITA . |
|
(4) |
|
Through the letter of instructions dated June 18, 2007, Bancomext, as
trustee of the trust created under Trust Agreement dated December 18,
1998 and holder of 45,000,000 Series BB shares, informed ASUR of
its decision to convert 22,050,000 Series BB shares into 22,050,000
Series B shares. |
ITA Trust and Shareholders Amended Agreement
The rules governing the sale of our Series BB shares to ITA required that ITA place all of its
Series BB shares in trust in order to guarantee ITAs performance of its obligations under the
technical assistance agreement and ITAs commitment to maintain its interest in ASUR for a
specified period. Accordingly, ITA has placed its shares in trust
with Bancomext. This trust, as amended in connection with the
conversion of 22,050,000 Series BB shares described above, provides that ITA may instruct Bancomext with respect to the voting of the shares held in trust
that currently represent 7.65% of our capital stock, regarding all
matters other than capital reductions, payment of dividends,
amortization of shares and similar distributions to our shareholders,
which are voted by the trustee in accordance with the vote of the
majority of the Series B shares.
Currently, ITA is restricted from transferring any of its remaining Series BB shares. After
December 18, 2008, ITA may sell in any year up to 20% of its remaining ownership interest in us
represented by Series BB shares. The term of the trust will be extended for an
additional 15 years if, at the end of the initial 15-year term, ITA holds shares representing
more
98
than 10% of our capital stock. ITA may terminate the trust before the second 15-year term
begins if: (i) ITA holds less than 10% of our capital stock at the end of the initial term; and
(ii) the technical services agreement has been terminated. ITA is required to deposit in the trust
any additional shares of our capital stock that it acquires.
ITAs stockholders have
entered into a shareholders agreement (and have amended
ITAs bylaws accordingly), which provides, among other things,
that (i) most
matters relating to ITAs participation in ASURs management are to
be decided by unanimity among the four members of its board of
directors; such matters to include the
removal of ASURs chief executive officer, the proposal to the board of
ASURs chief executive officer, and the adoption or
amendment of ASURs master development plans, business plans and
investment plans, and (ii) the two directors in ITAs board
by each of Copenhagen Airports and Fernando Chico Pardo are entitled
to appoint and dismiss one of the two directors to be elected by the
Series BB shareholders. Currently,
Copenhagen Airports and Fernando Chico Pardo are entitled to appoint
two directors each out of ITAs four directors.
Under the terms of the
participation agreement and the trust agreement, each of ITAs key partners,
currently Copenhagen Airports and Fernando Chico Pardo, is required to maintain at least a
25.5% ownership interest in ITA prior to December 18, 2014, unless otherwise approved by the
Ministry of Communications and Transportation. There can be no assurance that the terms of the
participation agreement or the trust would not be amended to reduce or eliminate these ownership
commitments. If ITA or any of its stockholders defaults on any obligation contained in the trust
agreement, or if ITA defaults on any obligation contained in the participation agreement or the
technical assistance agreement, after specified notice and cure provisions, the trust agreement
provides that the trustee may sell 5% of the shares held in the trust and pay the proceeds of such
sale to us as liquidated damages.
RELATED PARTY TRANSACTIONS
Arrangements with ITA
The rules for the sale of the Series BB shares required ITA, ASUR and the Ministry of
Communications and Transportation to enter into a participation agreement, which established the
framework for the option agreement, the technical assistance agreement and the Banco Nacional de
Comercio Exterior, S.N.C., or Bancomext, trust agreement.
Pursuant to the technical assistance agreement and the participation agreement, ITA and its
stockholders agreed to provide management and consulting services and transfer industry know-how
related to the operation of airports to us. These agreements entitle ITA to propose to our board a
candidate to be our chief executive officer, to appoint half our other executive officers and two
members of our board of directors. These agreements also grant us a perpetual and exclusive
license in Mexico to use all technical assistance and know-how transferred to us by ITA or its
stockholders during the term of the agreement. The technical assistance agreement has a
fifteen-year term and is automatically renewed for additional five-year terms, unless one party
provides notice of its intent not to renew within a specified period. We are required under this
agreement to pay ITA an annual fee equal to the greater of a fixed dollar amount or 5% of
our annual consolidated earnings before comprehensive financing cost, income taxes and
99
depreciation and amortization (determined in accordance with Mexican NIF and calculated prior to
deducting the technical assistance fee under this agreement). The fixed dollar amount decreases
during the initial five years of the agreement in order to create an incentive for ITA to increase
our earnings before comprehensive financing cost, income taxes and depreciation and amortization.
ITA is also entitled to reimbursement for the out-of-pocket expenses it incurs in its provision of
services under the agreement. The agreement allows ITA, its stockholders and their affiliates to
render additional services to us only if our Acquisitions and Contracts Committee determines that
these related persons have submitted the most favorable bid in a bidding process. This process is
described in Item 6. Directors, Senior Management and EmployeesCommittees. In 2002, 2003,
2004, 2005 and 2006, we recognized expenses of U.S.$3.7 million, U.S.$4.1 million, U.S.$5.8
million, U.S.$6.2 million and U.S.$6.6 million, respectively, pursuant to the technical assistance
agreement plus additional expenses of approximately U.S.$0.6 million, U.S.$0.3 million, U.S.$0.1
million, U.S.$0.2 million and U.S.$0.1 million, respectively.
Arrangements with Copenhagen Airports
In
June 2003 we entered into a contract with a subsidiary of Copenhagen Airports under
which we retained the services of Kjeld Binger as our interim chief executive officer in exchange
for a monthly fee equal to U.S.$31,119. His term as interim chief executive officer ended with his
resignation effective as of December 31, 2006.
Arrangements with Entities Controlled by Fernando Chico Pardo
In February 2007 we entered into a contract with Promecap, S.C. under which we retained the
services of Fernando Chico Pardo as our Chief Executive Officer in exchange for a monthly fee equal
to U.S.$37,804.
We also rent our executive offices in Mexico City from Gafapa, S.A. de C.V., another entity
controlled by Fernando Chico Pardo.
Item 8. Financial Information
See Item 18. Financial Statements beginning on page F-1.
Legal Proceedings
We are involved in legal proceedings from time to time that are incidental to the normal
conduct of our business.
We are currently involved in certain legal proceedings in which we are seeking a confirmation
of our right to terminate certain lease agreements upon the expiration of their term. These
proceedings include litigation involving the duty-free stores in Cancun, Cozumel and Merida.
The municipalities of Cancun, Cozumel, Huatulco, Merida, Minatitlan, Veracruz and Villahermosa
have given us notice requesting that we pay property tax (predial) for the property on which these
airports are located. However, we believe that the request to pay this tax is not in
accordance with applicable law relating to property in the public domain, which includes the
100
airports we currently operate under concessions. We filed a protective action in court against the
attempt to collect the tax by the municipal treasuries in each of these cities. Our cases against
the municipalities of Cancun, Cozumel, Veracruz, Oaxaca and Villahermosa were decided in our favor.
The other legal proceedings are still in progress.
We do not believe that liabilities related to any of these claims and proceedings against us
are reasonably likely to have, individually or in the aggregate, a material adverse effect on our
consolidated financial condition or results of operations.
DIVIDENDS
The declaration, amount and payment of dividends are determined by a majority vote of the
stockholders present at a stockholders meeting and generally, but not necessarily, on the
recommendation of the board of directors. So long as the Series BB shares represent at least 7.65%
of our capital stock, the declaration and payment of dividends will require the approval of the
holders of a majority of the Series BB shares. Figures included in this subsection are stated in
nominal pesos.
Mexican law requires that at least 5% of a companys net income (on a non-consolidated basis)
each year (after profit sharing and other deductions required by Mexican law) be allocated to a
legal reserve fund until such fund reaches an amount equal to at least 20% of its capital stock
(without adjustment for inflation).
Mexican companies may pay dividends only out of earnings (including retained earnings after
all losses have been absorbed or paid up) and only after such allocation to the legal reserve fund.
The reserve fund is required to be funded on a stand-alone basis for each company, rather than on
a consolidated basis. The level of earnings available for the payment of dividends is determined
under Mexican NIF. The legal reserve of our holding company, Grupo Aeroportuario del Sureste,
S.A.B. de C.V., is Ps. 162.1 million (which includes the required allocation corresponding to year
2006 net income). Our subsidiaries are required to allocate earnings to their respective legal
reserve funds prior to paying dividends to Grupo Aeroportuario del Sureste, S.A.B. de C.V.
Dividends paid to non-resident holders with respect to our Series B shares and ADSs are not
subject to Mexican withholding tax. Dividends that are paid from a companys distributable
earnings that have not been subject to corporate income tax will be subject to a corporate-level
dividend tax (payable by us) calculated on a gross-up basis by applying a factor 1.4925 in 2004,
1.4286 in 2005, 1.4085 in 2006, 1.3889 in 2007 and 1.3889 thereafter. Corporate tax rates of 33%
in 2004, 30% in 2005, 29% in 2006, 28% in 2007 and 28% thereafter are applied to the result. This
corporate-level dividend income tax on the distribution of earnings may be applied as a credit
against Mexican corporate income tax corresponding to the fiscal year in which the dividend was
paid or against the Mexican corporate income tax of the two fiscal years following the date in
which the dividend was paid. In the case of dividends paid in 2006, the credit would be applicable
against the Mexican corporate income tax of the following three fiscal years. Dividends paid from
a companys distributable earnings that have been subject to corporate income tax are not subject
to this corporate-level dividend income tax. Three of our subsidiaries
101
(Cancun, Villahermosa and Merida) benefit from an injunction that reduced the rate for
dividends from 47.0592% in 2005 to 32%.
As of December 31, 2006, we had no distributable earnings that were subject to corporate
income tax. Until we
generate such earnings subject to corporate income tax, dividends paid by us to non-resident
holders of Series B shares and ADSs will be subject to the corporate-level dividend tax income
discussed above.
On April 27, 2007, our stockholders approved the allocation of 5%, or Ps. 26.4 million, of our
net profits for the fiscal year ended December 31, 2006 to the legal reserve fund in compliance
with Mexican law. The stockholders approved the allocation of 5%, or Ps. 29.0 million, of our net
profits for the fiscal year ended December 31, 2005 to the legal reserve fund on April 27, 2006,
and approved the allocation of Ps. 32.6 million (5% of net income for fiscal year 2004) to the
legal reserve fund on April 28, 2005.
On April 27, 2007, our stockholders approved the payment of a net ordinary cash dividend after
income tax of Ps. 225.0 million or Ps. 0.75 per share for each outstanding Series B or BB share.
This dividend was payable as of May 31, 2007. At the general stockholders meeting on April 27,
2006, our stockholders agreed to pay net dividends after income tax of Ps. 210.7 million or Ps.
0.70 per share. Because this dividend payment was not taken from the after-tax earnings account,
it gave rise to an income tax of Ps. 86.0 million. At the general stockholders meeting on April
28, 2005, our stockholders agreed to pay net dividends after income tax of Ps. 200.0 million or Ps.
0.67 per share. Because this dividend payment was not taken from the after-tax earnings account,
it gave rise to an income tax of Ps. 85.7 million
In the absence of attractive investment opportunities, we intend to continue paying yearly
dividends out of our annual net retained earnings. We do not currently intend to implement a stock
repurchase program.
We will declare any future dividends in pesos. In the case of Series B shares represented by
ADSs, cash dividends are paid to the depositary and, subject to the terms of the Deposit Agreement,
converted into and paid in U.S. dollars at the prevailing exchange rate, net of conversion expenses
of the depositary. Fluctuations in exchange rates affect the amount of dividends that ADS holders
receive. For a more detailed discussion, see Item 10. Additional Information.
On April 27, 2007, our stockholders granted our board of directors the power to declare and
pay an extraordinary dividend to all shares representing our capital stock. Our board may declare
and pay this extraordinary dividend at any time during 2007 and until the next annual shareholders
meeting. The board may freely determine the terms and conditions of this extraordinary dividend.
102
Item 9. The Offer and Listing
Stock Price History
The following table sets forth, for the periods indicated, the high and low closing prices for
(i) the ADSs on the New York Stock Exchange in U.S. dollars and (ii) our common shares on the
Mexican Stock Exchange in pesos. For more information, see Item 10. Additional
InformationExchange Controls for the exchange rates applicable during the periods set forth
below. The information set forth in the table below reflects actual historical amounts at the
trade dates and has not been restated in constant pesos.
The annual high and low market prices for (i) our common shares on the Mexican Stock Exchange in
pesos and (ii) the ADSs on the New York Stock Exchange in U.S. dollars over the five most recent
financial years is as follows:
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Years ended |
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December 31, |
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U.S.$ per ADR(1) |
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Pesos per Series B Share |
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Low |
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High |
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|
Low |
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High |
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2002 |
|
|
10.17 |
|
|
|
11.75 |
|
|
|
10.80 |
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12.00 |
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|
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2003 |
|
|
15.95 |
|
|
|
17.60 |
|
|
|
18.50 |
|
|
|
19.70 |
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|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
2004 |
|
|
18.58 |
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|
|
27.05 |
|
|
|
17.38 |
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|
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30.15 |
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2005 |
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
First Quarter |
|
|
27.26 |
|
|
|
33.70 |
|
|
|
30.60 |
|
|
|
37.12 |
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Second Quarter |
|
|
29.00 |
|
|
|
32.54 |
|
|
|
31.68 |
|
|
|
34.82 |
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Third Quarter |
|
|
37.05 |
|
|
|
41.79 |
|
|
|
39.71 |
|
|
|
45.00 |
|
Fourth Quarter |
|
|
31.20 |
|
|
|
34.17 |
|
|
|
32.70 |
|
|
|
36.25 |
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2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
|
28.93 |
|
|
|
35.19 |
|
|
|
30.56 |
|
|
|
37.00 |
|
Second Quarter |
|
|
30.60 |
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|
|
39.66 |
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|
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35.00 |
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|
|
43.80 |
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Third Quarter |
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30.40 |
|
|
|
38.37 |
|
|
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29.00 |
|
|
|
42.50 |
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Fourth Quarter |
|
|
36.85 |
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|
|
45.16 |
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|
|
39.90 |
|
|
|
49.29 |
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U.S.$ per ADR(1) |
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Pesos per Series B Share |
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Low |
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High |
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|
Low |
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|
High |
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Monthly Prices |
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December 2006 |
|
|
42.00 |
|
|
|
45.16 |
|
|
|
45.42 |
|
|
|
49.29 |
|
January 2007 |
|
|
41.82 |
|
|
|
46.15 |
|
|
|
45.85 |
|
|
|
50.65 |
|
February 2007 |
|
|
42.25 |
|
|
|
48.72 |
|
|
|
47.00 |
|
|
|
53.48 |
|
March 2007 |
|
|
41.07 |
|
|
|
49.41 |
|
|
|
45.80 |
|
|
|
54.50 |
|
April 2007 |
|
|
47.26 |
|
|
|
49.07 |
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|
|
52.00 |
|
|
|
54.03 |
|
May 2007 |
|
|
47.67 |
|
|
|
51.89 |
|
|
|
52.70 |
|
|
|
55.80 |
|
June 2007 (2) |
|
|
49.52 |
|
|
|
55.64 |
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|
|
54.27 |
|
|
|
59.99 |
|
|
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(1) |
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10 Series B shares per ADR. |
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(2) |
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Through June 25, 2007. |
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Sources: |
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Mexican Stock Exchange and the New York Stock Exchange. |
TRADING ON THE MEXICAN STOCK EXCHANGE
The Mexican Stock Exchange, located in Mexico City, is the only stock exchange in Mexico.
Founded in 1894, it ceased operations in the early 1900s, and was reestablished in 1907. The
Mexican Stock Exchange is organized as a corporation whose shares are held by brokerage firms.
These firms are exclusively authorized to trade on the floor of the Exchange.
Trading on the Mexican Stock Exchange takes place exclusively through an automated
inter-
103
dealer quotation system known as SENTRA, which is open between the hours of 8:30 a.m. and
3:30 p.m., Mexico City time, each business day. Each trading day is divided into six trading
sessions with ten-minute periods separating each session. Trades in securities listed on the
Mexican Stock Exchange can, subject to certain requirements, also be effected off the Exchange.
Due primarily to tax considerations, however, most transactions in listed Mexican securities are
effected through the Exchange. The Mexican Stock Exchange operates a system of automatic
suspension of trading in shares of a particular issuer as a means of controlling excessive price
volatility. The suspension procedures will not apply to shares that are directly or indirectly
(through ADSs or CPOs) quoted on a stock exchange outside Mexico.
Settlement is effected three business days after a share transaction on the Mexican Stock
Exchange. Deferred settlement, even if by mutual agreement, is not permitted without the approval
of the CNBV. Most securities traded on the Mexican Stock Exchange are on deposit with S.D. Indeval
Instituto para el Deposito de Valores, S.A. de C.V., a privately-owned central securities
depositary that acts as a clearing house, depositary, custodian and registrar for Mexican Stock
Exchange transactions, eliminating the need for the physical transfer of shares.
The Mexican Stock Exchange is one of Latin Americas largest exchanges in terms of market
capitalization, but it remains relatively small and illiquid compared to major world markets, and
therefore subject to greater volatility.
As of December 31, 2006, 129 Mexican companies, excluding mutual funds, had equity listed on
the Mexican Stock Exchange. In 2006, the ten most actively traded equity issues (excluding banks)
represented approximately 58% of the total volume of equity issues traded on the Mexican Stock
Exchange. Although the public participates in the trading of securities, a major part of the
activity of the Mexican Stock Exchange reflects transactions by institutional investors. There is
no formal over-the-counter market for securities in Mexico.
The market value of securities of Mexican companies is, to varying degrees, affected by
economic and market conditions in other emerging market countries and in the United States. In
late October 1997, for example, prices of both Mexican debt securities and Mexican equity
securities dropped substantially following declines earlier in the year in the Asian, Russian and
Brazilian securities markets.
Item 10. Additional Information
Bylaws
This section summarizes certain provisions of Mexican law and our estatutos sociales (bylaws),
a copy of which is attached to this Form 20-F as Exhibit 1.1.
At our Extraordinary Stockholders Meeting held on April 27, 2006, our shareholders approved
certain amendments to conform our bylaws to the provisions of the Mexican Securities Market Law and
the Mexican Business Associations Law (Ley General de Sociedades Mercantiles), as well as to
clarify and adjust certain provisions thereof.
104
Purposes
The purposes of our company include the following:
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to acquire shares, ownership or other interests in companies engaged in
the management, operation, including providing airport, complementary and commercial
services, construction and/or use of civil aerodromes and in accordance with the
Mexican Airport Law and its regulations, as well as to hold capital stock in companies
that provide any other type of services and to vote the shares of any such companies;
to sell, transfer or dispose of any such shares or ownership interests or other
securities allowed by law; |
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to receive and to provide the services as required to carry out our
corporate purposes, including, without limitation, technical consulting services in the
industrial, administrative, accounting, marketing or finance fields, in connection with
the management, operation, construction and/or utilization of airports; |
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to request and obtain concessions and permits for the management,
operation, construction and/or utilization of airports, as well as for providing any
other services necessary for the use of such airports and for carrying out any activity
which supports and is related with such purpose. |
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to obtain, acquire, use, license or dispose of all types of patents,
certificates of invention, registered trademarks, trade names, copyright or rights with
regard thereto, whether in Mexico or abroad; |
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to obtain all types of loans or credits, with or without specific
guarantee, and to grant loans, in each case, in the ordinary course of business of the
Company; |
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to grant any kind of guaranty and security on issued negotiable
instruments or obligations assumed by the Company or by companies in which the Company
may hold ownership interests, in each case, in the ordinary course of business of the
Company; |
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to issue any unsubscribed shares of our capital stock to be kept in our
treasury in order to be delivered upon subscription thereof, as well as to execute
option agreements that grant to third parties the right to subscribe and pay for our
shares; |
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to hold, possess, sell, transfer, dispose of or lease any assets, or
real or personal property that may be necessary or convenient to carry out our
corporate purposes; and |
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generally, to carry out and perform all actions, agreements and related,
incidental or ancillary transactions in furtherance of the above-mentioned purposes. |
Directors
Our bylaws provide that our board of directors will have such odd number of members as
determined by the shareholders meeting, which number shall not be less than 7 (seven) and shall be
subject to the maximum limit set forth by the Securities Market Law.
105
Each person (or group of persons acting together) holding 10% of our capital stock in the form
of Series B shares is entitled to elect one director. The shareholders of Series BB shares will
have the right to appoint 2 (two) members and their respective alternates. The remaining positions
on the board of directors will be filled based on the vote of all holders of Series B shares,
including those Series B holders that were entitled to elect a director by virtue of their owning
10% of our capital stock. The candidates to be considered for election as directors by the Series
B stockholders will be proposed to the stockholders meeting by the Nominations and Compensation
Committee. All directors are elected based on a simple majority of the votes cast at the relevant
stockholders meeting. Our bylaws do not currently require mandatory retirement of directors after
they reach a certain age. The compensation of our directors is proposed by the Nominations and
Compensation Committee to all of our stockholders at stockholders meetings for their approval.
The number of directors to be elected by the holders of Series B shares is to be determined
based on the number of directors elected by persons holding Series B shares representing 10%
(individually or as a group) of our capital stock and by the holders of the Series BB shares. If
less than seven directors are elected by 10% stockholders exercising their right to elect one
director and by the holders of the Series BB shares, the total number of directors to be elected by
the Series B holders will be such number as is required to reach seven. If seven directors are
elected by 10% stockholders exercising their right to elect one director and by the holders of the
Series BB shares, the Series B stockholders will be entitled to elect two directors in addition to
those elected by 10% stockholders. If more than seven directors are elected by 10% stockholders
exercising their right to elect one director and the holders of the Series BB shares, the Series B
stockholders will be entitled to elect one or two directors in addition to the directors elected by
10% stockholders (individually or as a group) (depending on which number will result in an odd
number of directors).
Authority of the Board of Directors
The powers of the board include, without limitation, the power:
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to participate in our strategic planning decisions, |
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to authorize changes in our policies regarding financial structure,
products, market development and organization, |
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to oversee compliance with general corporate practices, our bylaws and
the minority rights set forth thereunder, |
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to call for stockholders meetings and act on their resolutions, |
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to create special committees and grant them the powers and authority it
sees fit, provided that said committees will not be vested with the authorities which
by law or under our bylaws are expressly reserved for the stockholders or the board of
directors, |
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to determine how to vote the shares held by us in our subsidiaries |
106
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to appoint our chief executive officer from among the candidates
proposed by the members of the Board of Directors appointed by the Series BB
shareholders, and to appoint those officers other than those designated by the Series
BB directors or the Operating Committee, and |
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to approve, upon proposal by the Operating Committee: (i) our annual
budget and that of our subsidiaries; and (ii) the master development plan and any
amendments thereto for each of the airports to be submitted to the Ministry of
Communications and Transportation. |
Meetings of the board of directors will be validly convened and held if a majority of its
members are present. Resolutions at said meetings will be valid if approved by a majority of the
members of the board of directors, unless our bylaws require a higher number. The chairman has a
tie-breaking vote.
Resolutions at board meetings with respect to any of the issues listed below will be valid
only if approved by the members of the board of directors elected by the holders of the Series BB
shares:
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approval of our financial statements and those of our subsidiaries and
their submission to the stockholders meeting, |
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approval of the 5-year master development plans for each of the airports
operated by our subsidiaries, |
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annual approval of the business plan and the investment budget, |
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approval of capital investments not considered in the approved annual
budget for each fiscal year, |
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approval of any sale of assets having, individually or jointly, a value
exceeding the lower of (i) U.S.$5.0 million, or (ii) 5% (five per cent) of the
consolidated assets of the Company, but which does not exceed 20% (twenty percent) of
the consolidated assets of the Company, |
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incurrence of any indebtedness, whether by means of direct loans or
financial leases, in an amount greater than the lower of (i) U.S.$5.0 million, or (ii)
5% (five percent) of the consolidated assets of the Company, but which does not exceed
20% (twenty percent) of the consolidated assets of the Company, |
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determine the manner in which the company shall vote its shares at the
shareholders meeting of its subsidiaries, taking into consideration the proposal of the
Operating Committee, |
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proposal to increase our capital or that of our subsidiaries, |
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approval of any sale of shares of the capital stock of our subsidiaries, |
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approval of any purchase or sale of shares or interests in any company,
except for: (a) the acquisition of shares and/or securities issued by investment
companies, and (b) the acquisition of securities through investment companies (mutual
funds), |
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approval or amendment of our management structure, |
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creation of new committees, delegation of powers to the same and changes
to the powers of any existing committee, |
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approval of our dividend policy and the application of the Companys
profits and its submission to the stockholders meeting, and |
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appointment of the chief executive officer from among the candidates
proposed by the members of the board of directors appointed by the Series BB
shareholders. |
Powers of Series BB Directors
The Series BB directors are entitled to:
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present to the board of directors the name or names of candidates for
appointment as chief executive officer, |
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remove the chief executive officer, |
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appoint and remove half of our executive officers, |
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appoint two members of the Operating Committee and their substitutes,
and at least one member of the Acquisitions and Contracts Committee and his or her
substitute, and |
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determine the composition of the Operating Committee. |
Our Capital Stock
The following table sets forth our authorized capital stock and our issued and outstanding
capital stock as of June 25, 2007:
Capital Stock
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Authorized |
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Issued and outstanding |
Fixed capital stock: |
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Series B shares |
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277,050,000 |
* |
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277,050,000 |
* |
Series BB shares |
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22,950,000 |
* |
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22,950,000 |
* |
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Variable capital stock: |
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Series B shares |
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Series BB shares |
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* |
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After giving effect to the conversion by ITA of 22,050,000 Series BB shares into
22,050,000 Series B shares in June 2007. |
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All ordinary shares confer equal rights and obligations to holders within each series. The
Series BB shares have the voting and other rights described below.
Our bylaws provide that our shares have the following characteristics:
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Series B. Series B shares currently represent 92.35% of our capital.
Series B shares may be held by any Mexican or foreign natural person, company or
entity. |
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Series BB. Series BB shares currently represent 7.65% of our capital.
Series BB shares may be held by any Mexican or foreign natural person, company or
entity. |
Under the Mexican Airport Law and the Mexican Foreign Investments Law, foreign persons may not
directly or indirectly own more than 49% of the capital stock of a holder of an airport concession
unless an authorization from the Mexican Commission of Foreign Investments is obtained. We
obtained this authorization in 1999 and as a consequence these restrictions do not apply to our
Series B or Series BB shares.
Voting Rights and Stockholders Meetings
Each Series B share and Series BB share entitles the holder to one vote at any general meeting
of our stockholders. Holders of Series BB shares are entitled to elect two members of our board of
directors and holders of Series B shares are entitled to name the remaining members of the board of
directors.
Under Mexican law and our bylaws, we may hold three types of stockholders meetings:
ordinary, extraordinary and special. Ordinary stockholders meetings are those called to discuss
any issue not reserved for extraordinary stockholders meeting. An annual ordinary stockholders
meeting must be convened and held within the first four months following the end of each fiscal
year to discuss, among other things, the report prepared by the Board on our financial statements,
the appointment of members of the Board and the determination of compensation for members of the
Board. In addition, the ordinary stockholders meeting shall meet for the approval of any
transaction representing the equivalent of 20% or more of the consolidated assets of the Company.
Extraordinary stockholders meetings are those called to consider any of the following
matters:
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extension of a companys duration or voluntary dissolution, |
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an increase or decrease in a companys minimum fixed capital, |
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change in corporate purpose or nationality, |
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any transformation, merger or spin-off involving the company, |
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any stock redemption or issuance of preferred stock or bonds, |
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the cancellation of the listing of our shares with the National Registry
of Securities or on any stock exchange, |
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amendments to a companys bylaws, and |
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any other matters for which applicable Mexican law or the bylaws
specifically require an extraordinary meeting. |
Special stockholders meetings are those called and held by stockholders of the same series or
class to consider any matter particularly affecting the relevant series or class of shares.
Stockholders meetings are required to be held in our corporate domicile, which is Mexico
City. Calls for stockholders meetings must be made by the Chairman, the Secretary or any two
members of the board of directors. Any stockholder or group of stockholders representing at least
10% of our capital stock has the right to request that the board of directors call a stockholders
meeting to discuss the matters indicated in the relevant request. If the board of directors fails
to call a meeting within 15 calendar days following receipt of the request, the stockholder or
group of stockholders representing at least 10% of our capital stock may request that the call be
made by a competent court.
Calls for stockholders meetings must be published in the official gazette of the federation
or in one newspaper of general circulation in Mexico at least 15 calendar days prior to the date of
the meeting. Each call must set forth the place, date and time of the meeting and the matters to
be addressed. Calls must be signed by whoever makes them, provided that calls made by the board of
directors must be signed by the Chairman, the Secretary or a special delegate appointed by the
board of directors for that purpose. Stockholders meetings will be validly held and convened
without the need of a prior call or publication whenever all the shares representing our capital
are duly represented.
To be admitted to any stockholders meeting, stockholders must: (i) be registered in our
share registry; and (ii) at least one business day prior to the commencement of the meeting submit
(a) an admission ticket issued by us for that purpose, and (b) a certificate of deposit of the
relevant stock certificates issued by the Secretary or by a securities deposit institution, a
Mexican or foreign bank or securities dealer in accordance with the Mexican Securities Market Law.
The share registry will be closed three days prior to the date of the meeting. Stockholders may be
represented at any stockholders meeting by one or more attorneys-in-fact who may not be directors
of ASUR. Representation at stockholders meetings may be substantiated pursuant to general or
special powers of attorney or by a proxy executed before two witnesses.
Promptly following the publication of any call for a stockholders meeting, we will provide
copies of the publication to the depositary for distribution to the holders of ADSs. Holders of
ADSs are entitled to instruct the depositary as to the exercise of voting rights pertaining to the
Series B shares.
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Quorums
Ordinary meetings are regarded as legally convened pursuant to a first call when at least 50%
of the shares representing our capital are present or duly represented. Resolutions at ordinary
meetings of stockholders are valid when approved by a majority of the shares present at the
meeting. Any number of shares represented at an ordinary meeting of stockholders convened pursuant
to a second or subsequent call constitutes a quorum. Resolutions at ordinary meetings of
stockholders convened in this manner are valid when approved by a majority of the shares present at
the meeting.
Extraordinary stockholders meetings are regarded as legally convened pursuant to a first call
when at least 75% of the shares representing our capital are present or duly represented.
Resolutions at an extraordinary meeting of stockholders pursuant to a first call are valid if taken
by the favorable vote of shares representing at least 50% of our capital. Extraordinary
stockholders meetings are regarded as legally convened pursuant to a second or subsequent call
when at least 50% of the shares representing our capital are present or duly represented.
Resolutions at an extraordinary meeting of stockholders pursuant to a second or subsequent call are
valid if taken by the favorable vote of shares representing at least 50% of our capital.
Notwithstanding the foregoing, resolutions at extraordinary meetings of stockholders called to
discuss any of the issues listed below are valid only if approved by a vote of shares representing
at least 75% of our capital:
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any amendment to our bylaws which: (i) changes or deletes the
authorities of our committees; or (ii) changes or deletes the rights of minority
stockholders, |
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any actions resulting in the cancellation of the concessions granted to
us or our subsidiaries by the Mexican government or any assignment of rights arising
therefrom, |
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termination of the participation agreement that was entered into by ITA
and the Mexican government in connection with the Mexican governments sale of the
Series BB shares to ITA, |
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a merger by us with an entity the business of which is not related to
the business of us or our subsidiaries, and |
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a spin-off, dissolution or liquidation of ASUR. |
Our bylaws also establish the following voting requirements:
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the amendment of the restrictions on ownership of shares of our capital
stock requires the vote of holders of 85% of our capital stock; |
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a delisting of our shares requires the vote of holders of 95% of our
capital stock; and |
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the amendment of the provisions in our bylaws requiring that a
stockholder seeking to obtain control carry out a tender offer requires the vote of
holders of 85% of our capital stock. |
Right of Withdrawal
Any stockholder having voted against a resolution validly adopted at a meeting of our stockholders
with respect to (i) a change in our corporate purpose or nationality, (ii) a change of corporate
form, (iii) a merger involving us in which we are not the surviving entity or the dilution of its
capital stock by more than 10%, or (iv) a spin-off, may request redemption of its shares, provided
that the relevant request is filed with us within fifteen days following the holding of the
relevant stockholders meeting. The redemption of the stockholders shares will be effected at the
lower of (a) 95% of the average trading price determined on the closing prices of our shares over
the last thirty days on which trading in our shares took place prior to the date on which the
relevant resolution becomes effective, during a period not longer than six months, or (b) the book
value of the shares in accordance with our most recent audited financial statements approved by our
stockholders meeting. Pursuant to our bylaws, our stockholders have waived the right to redeem
their variable capital contributions provided in the Mexican General Law of Business Corporations.
Veto Rights of Holders of Series BB Shares
So long as the Series BB shares represent at least 7.65% of our capital stock, resolutions
adopted at stockholders meetings with respect to any of the issues listed below will only be valid
if approved by a vote of a majority of the Series BB shares:
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approval of our financial statements, |
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liquidation or dissolution, |
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capital increases or decreases, |
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declaration and payment of dividends, |
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amendment to our bylaws, |
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mergers, spin-offs or share-splits, |
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grant or amendment of special rights to series of shares, and |
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any decision amending or nullifying a resolution validly taken by the
board of directors with respect to (i) presentation to the Board of Directors of the
name or names of the candidates for appointment as Chief Executive Officer of the
Company, (ii) removal of the Chief Executive Officer of the Company, (iii) appointment
and removal of half of the first-level management officers in accordance with the
Technical Assistance Agreement, (iv) appointment of two members of our Operating
Committee and their substitutes and at least one member of the Acquisitions and
Contracts Committee and his or her substitute, and (v) appointment of the members of |
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the Operating Committee whose appointment requires the consent of the holders of the
Series BB shares. |
Dividends and Distributions
At our annual ordinary general stockholders meeting, the board of directors will submit to
the stockholders for their approval our financial statements for the preceding fiscal year. Five
percent of our net income (after profit sharing and other deductions required by Mexican law) must
be allocated to a legal reserve fund until the legal reserve fund reaches an amount equal to at
least 20% of our capital stock (without adjustment for inflation). Additional amounts may be
allocated to other reserve funds as the stockholders may from time to time determine including a
reserve to repurchase shares. The remaining balance, if any, of net earnings may be distributed as
dividends on the shares of common stock. A full discussion of our dividend policy may be found in
Item 8. Financial InformationDividends.
Registration and Transfer
Our shares are registered with the Mexican Securities Registry, as required under the
Securities Market Law and regulations issued by the Mexican Banking and Securities Commission.
In the event of cancellation of ASURs registration with the
Mexican Securities Registry, ASUR will be
required to make a public offer to purchase all outstanding shares, prior to such cancellation.
Notwithstanding the foregoing, ASUR may be exempted from
making the public offer if (i) at least 95% of stockholders agree not to make the public offer,
(ii) the amount of the public offer is greater than 300,000 investment units (unidades de inversion
or UDIS), and (iii) enough resources are transferred to a trust with a minimum term of 6 months
specifically created for purposes of purchasing, at the same price of the offer, the shares of the
stockholders that do not tender their shares. Unless the Mexican Banking and Securities Commission
authorizes otherwise, the public offer price shall be the higher of the weighted average trade
price (based on volume) for our shares during the thirty prior days on which shares may have been
quoted prior to the commencement of the public offer during a period not longer than six months; in
the event the number of days on which shares may have been quoted during such period is shorter
than thirty, the days on which the shares were effectively quoted shall be taken into
consideration; or if no shares traded during such period, the book value (valor contable) of the
shares as calculated in accordance with the most recent quarterly report submitted to the Mexican
Banking and Securities Commission and to the Mexican Stock Exchange. Any amendments to the
foregoing provisions included in our bylaws require the prior approval of the Mexican Banking and
Securities Commission and the resolution of the extraordinary stockholders meeting adopted by a
minimum voting quorum of 95% of our outstanding capital stock.
Series BB shares may only be transferred after conversion into Series B shares, and are
subject to the following rules:
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Except with the prior authorization by the Ministry of Communications
and Transportation, ITA is required to retain its interest in the Series BB shares
through December 18, 2008. |
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After December 18, 2008, ITA may sell in any year up to 20% of its
interest in the Series BB shares. |
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If ITA owns Series BB shares that represent less than 7.65% of our
capital stock after December 18, 2013, those remaining Series BB shares must be
converted into freely transferable Series B shares. |
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If ITA owns Series BB shares representing at least 7.65% of our capital
stock after December 18, 2013, those Series BB shares may be converted into Series B
shares, provided the holders of at least 51% of Series B shares (other than shares held
by ITA and any of its related persons) approve such conversion and vote against
renewal of the technical assistance agreement. |
For purposes of our bylaws, a related person means any of the following:
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persons that have control or significant influence in an entity that
forms part of the corporate group or consortium to which the company belongs, as well
as the directors, managers or relevant officers of the entities that form part of such
group or consortium, |
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persons that have executive authority in an entity that forms part of a
corporate group or consortium to which the company belongs, |
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the spouse, common-law spouse, blood or civil-law relatives up to the
fourth degree or in-laws up to the third degree, of any individuals that fall into any
of the categories described above, as well as the partners, owners and co-owners of the
entities mentioned above with whom they have a business relationship, |
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entities that are part of the corporate group or consortium to which the
company belongs, |
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entities over which any of the persons referred to in the first three
bullets above exercise control or significant influence, |
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in the case of ASUR, ITA, and |
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in the case of ITA, its stockholders and their related persons. |
For purposes of our bylaws, control of a person means the ability of a person or group of
persons to do any of the following:
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directly or indirectly impose decisions in general shareholders or
owners meetings or any equivalent body or appoint or remove the majority of board
members or managers of an entity, |
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hold the rights that directly or indirectly allow the voting of over 50%
(fifty percent) of the capital of an entity, or |
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directly or indirectly direct the management, strategy or principal
policies of an entity, whether through the ownership of securities, under contract or
otherwise. |
Stockholder Ownership Restrictions and Antitakeover Protection
Ownership Restrictions
Holders of our shares are subject to the following restrictions:
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subject to the tender offer procedures described below, holders of
Series B shares, either individually or together with their related persons, will have
no ownership limitation whatsoever with regard to the shares representing such series; |
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Series BB shares may represent no more than 15% of our outstanding
capital stock; |
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subject to the tender offer procedures described below, holders of
Series BB shares, either individually or together with their related persons, may also
own Series B shares without limitation, |
Any amendment to the above provisions requires the vote of shares representing 85% of our
capital stock.
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no more than 5% of our outstanding capital stock may be owned by air
carriers; and |
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foreign governments acting in a sovereign capacity may not directly or
indirectly own any portion of our capital stock. |
Air carriers and their subsidiaries and affiliates are not permitted, directly or indirectly,
to control ASUR or any of our subsidiary concession holders.
Change of Control and Tender Offer Procedures
Under our bylaws and applicable Mexican law, any person or group that intends to acquire,
directly or indirectly, ownership of 30% or more of our ordinary shares through one or more
transactions must make the acquisition through a public offer in accordance with applicable law and
the following provisions of our bylaws:
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The offer must include both of our series of shares, and the
consideration offered per share must be the same, regardless of the class or type of
share. |
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If the offeror intends to obtain control of the company, the offer must
be for 100% of our capital stock, and if the offer does not imply obtaining control,
then the offer must be for at least 10% of our capital stock. |
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The offer must indicate the maximum number of shares it covers and, if
applicable, the minimum number of shares on which the offer is conditioned. |
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The offer may not provide any consideration that implies a bonus or
higher price to the amount of the offer in favor of any person or group of persons
related to the offeree (not including agreements that have been approved by our board
of directors of the company, taking into account the opinion of our Auditing Committee
and have been disclosed to the investing public). |
Such public offers will require prior approval from the majority of the members of our board
of directors appointed for each one of the series of shares of our capital stock. In case the
offeror intends to acquire control of the company, the provisions of the Securities Market Law
relative to shareholders meetings and shareholders rights, insofar as they do not conflict with
the provisions of this section, will apply.
For the purposes of the above, the following rules and procedures will apply under Mexican law
and our bylaws:
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The offeror must inform us, through the board of directors, of the terms
and conditions of the offer it intends to make by sending a notice to our board of
directors. |
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Immediately after it receives the notice, our board of directors must
provide to the Mexican Stock Exchange a notice of applicable legal provisions, and make
it available to all our shareholders. |
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Our board of directors must prepare, considering the opinion of the
Audit Committee, its opinion with regard to the price or consideration offered, any
other terms and conditions of the offer and conflicts of interest, if any, that each
member of the board of directors may have with respect to the offer. This opinion may
include the opinion of an independent expert retained by our board. |
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Our board of directors will provide this opinion to the investing public
through the Mexican Stock Exchange within three months after receipt of the offer
notice, at the latest. |
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The members of our board of directors and our chief executive officer of
the company must disclose to the investing public, along with the opinions mentioned
above, as applicable, the decision they will take in connection with their own shares. |
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If our board approves the terms and conditions of any offer, the offeror
must obtain prior authorization from the Ministry of Communications and Transportation
for the change of control prior to the commencing the public offer. See Item 4.
Information on the CompanyRegulatory FrameworkReporting, Information and Consent
Requirements. |
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For purposes of the preceding item exclusively, and in accordance
with the provisions of Article 23 of the Mexican Airports Law, a person or group of |
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persons shall be deemed to have control when it owns 35% or more of the capital
stock of the company, has control of the general shareholders meetings, or is able
to appoint the majority of the members in charge of management or otherwise control
the company. |
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If the holders of the Series BB shares express their interest in
accepting an offer (which does not imply any obligation on their part to participate in
such offer), the launching of the offer shall be conditioned upon obtaining prior
authorizations from the Ministry of Communications and Transportation, including those
relating to the transfer of the Series BB shares and the replacement of ITA in its
capacity as strategic partner under the technical assistance and participation
agreements. |
Changes in Capital Stock
Increases and reductions of our minimum fixed capital must be approved at an extraordinary
stockholders meeting, subject to the provisions of our bylaws and the Mexican General Law of
Business Corporations. Increases or reductions of the variable capital must be approved at an
ordinary stockholders meeting in compliance with the voting requirements of our bylaws.
We may issue unsubscribed shares that will be kept in the treasury, to be subsequently
subscribed by the investing public, provided that (i) the general extraordinary shareholders
meeting approves the maximum amount of the capital increase and the conditions on which the
corresponding placement of shares shall be made, (ii) the subscription of issued shares is made
through a public offer after registration in the National Securities Registry, complying, in either
case, with the provisions of the Securities Market Law and other applicable law and (iii) the
amount of the subscribed and paid-in capital of the company is announced when the company makes the
authorized capital increase public. The preferential subscription right provided under Article 132
of the General Law of Business Entities is not applicable to capital increases through public
offers.
In the event of a capital increase not involving a public offer, the shareholders will have a
preferential right to subscribe to such increase, in proportion to the number of shares held by
each at the time the increase is approved pursuant to the provisions of Article 132 of the General
Law of Business Entities, as established hereinafter, unless the subscription offer is made under
the provisions of Article 53 of the Securities Market Law, or in the case of an issuance of shares
kept in the Treasury for conversion of debentures in terms of Article 210 bis of the General Law of
Negotiable Instruments and Credit Transactions.
Our capital stock may be reduced by resolution of a stockholders meeting taken pursuant to
the rules applicable to capital increases. Our capital stock may also be reduced by repurchase of
our own stock in accordance with the Securities Market Law (See Share Repurchases).
Share Repurchases
We may acquire, with prior agreement from the Board of Directors, the shares representing its
capital stock or negotiable instruments that represent such shares, subject to the following
conditions:
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The acquisition is carried out in the Mexican Stock Exchange. |
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The acquisition and sale on the Mexican Stock Exchange is made at market
price (except when dealing with public offerings or auctions authorized by the National
Banking and Securities Commission). |
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If the acquisition is charged against working capital, the shares may be
kept by us without need of making a reduction of capital stock. Otherwise, if the
acquisition is charged against the capital stock, the shares will be converted into
unsubscribed shares kept in our treasury, without need of a resolution by the
shareholders meeting. |
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The company must announce the amount of the subscribed and paid-in
capital when the amount of the authorized capital represented by the issued and
unsubscribed shares is publicly announced. |
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The general ordinary shareholders meeting will expressly determine for
each fiscal year the maximum amount of resources that we may use to purchase our own
shares or negotiable instruments that represent such shares, with the only limitation
that the sum or total of the resources that may be used for such purpose may not
exceed, at any time, the total balance of the net profits of the company, including
retained profits. |
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We must be up to date in the payment of the obligations derived from
debt instruments issued and registered in the National Securities Registry that we may
have issued. |
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The shares of the company and the negotiable instruments that represent
such shares that belong to us or, if any, the shares issued and not subscribed that are
kept in the treasury, may be placed among the investing public without requiring a
resolution from the shareholders meeting or the board of directors. For the purposes
of this paragraph, the provisions of Article 132 of the General Law of Business
Entities will not apply. |
Shares of the company belonging to us may not be represented or voted in shareholders
meetings, nor may corporate or economic rights of any kind be exercised, nor will the shares be
considered as outstanding for the purpose of determining the quorum and the votes in shareholders
meetings.
Ownership of Capital Stock by Subsidiaries
Our subsidiaries may not, directly or indirectly, invest in our shares, unless such
subsidiaries acquired our shares to comply with employee stock option or stock sale plans that are
established, granted or designed in favor of the employees or officers of such subsidiaries. The
number of shares acquired for such purpose may not exceed 15% of our outstanding capital stock.
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Liquidation
Upon our dissolution, one or more liquidators must be appointed at an extraordinary
stockholders meeting to wind up our affairs. All fully paid and outstanding shares will be
entitled to participate equally in any distribution upon liquidation. Partially paid shares
participate in any distribution in the same proportion that such shares have been paid at the time
of the distribution.
Other Provisions
Liabilities of the members of the Board of Directors
As with any other Mexican corporation, under the provisions of the Mexican Securities Market
Law, we or any stockholder or group of stockholders holding at least 5% of our capital stock may
directly file a civil liability action under Mexican law against the members of the board of
directors.
The Mexican Securities Market Law expressly sets forth the concept of duty of care for the
members of the board of directors; that is, they must act in good faith and in the companys best
interest. From a practical point of view, this means that the members of the board of directors
must request and review information, require the presence of relevant managers and external
advisors in board meetings, postpone board meetings as a result of incomplete information, attend
board meetings regularly and disclose relevant information to the board and/or the committees.
The Mexican Securities Market Law expressly sets forth the concept of duty of loyalty for
the members of the board of directors, that is, that they must maintain confidentiality, avoid
conflicts of interest and not favor their own interest or the interests of certain groups. From a
practical point of view, the members of the board of directors must abstain from voting on issues
in which they have a conflict of interest, follow guidelines for the approval of transactions with
related parties, refrain from using or taking advantage of the assets of the company or its
subsidiaries and refrain from using privileged information and from taking advantage of business
opportunities. A lack of loyalty may result in criminal penalties of up to twelve years of
imprisonment.
In accordance with the provisions of the Securities Market Law, the responsibility to
indemnify for the damages and losses caused to the Company due to any lack of diligence of the
members of the Board of Directors, or its Secretary or Alternate Secretary, regarding any actions
or decisions of the Board of Directors or any failure of the Board to act or make a decision
because the Board could not legally meet, and in general for any lack of diligence, shall not,
individually or in the aggregate, exceed the amount equivalent to the total of net fees received by
such individuals from the Company during the prior 12 months. Notwithstanding the foregoing, the
limitation on the indemnification amount as set forth in this paragraph shall not be applicable in
the event of fraud, willful misconduct, or illegal acts under the Securities Market Law and other
laws.
119
The Company, in any case, is required to indemnify and hold the relevant officers, members of
the Board of Directors and the Secretary and Alternate Secretary harmless from any liability that
they may incur with respect to third parties in the performance of their duties, which shall
include (a) the indemnity amount to be paid for the damages caused by their acts to third parties
and, (b) the expenses they may incur (including, without limitation, legal and advisory fees) in
connection with item (a) of this paragraph, provided that such expenses are reasonable and duly
documented, except in cases of fraud, willful misconduct, or illegal acts under the Securities
Market Law and other laws.
Information to Stockholders
The Mexican Securities Market Law establishes that our Board of Directors must present the
following reports at the annual stockholders meeting:
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the report prepared by the Audit Committee, |
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|
the report prepared by our Chief Executive Officer pursuant to the
Mexican General Law on Business Corporations which includes (i) a report of the
directors on the operations of the company during the preceding year, as well as on the
policies followed by the directors and on the principal existing projects, (ii) a
statement of the financial condition of the company at the end of the fiscal year,
(iii) a statement showing the results of operations of the company during the preceding
year, as well as changes in the companys financial condition and capital stock during
the preceding year, and (iv) the notes which are required to complete or clarify the
above mentioned information, |
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the Boards opinion on the report prepared by our Chief Executive
Officer as set forth above, and |
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a report explaining the principal accounting and information policies
and criteria followed in the preparation of the financial information |
In addition to the foregoing, our bylaws provide that the board of directors must also prepare
the information referred to above with respect to any subsidiary that represents at least 20% of
our net worth (based on the financial statements most recently available).
Duration
The duration of our corporate existence is indefinite.
Stockholders Conflict of Interest
Under Mexican law, any stockholder that has a conflict of interest with respect to any
transaction must abstain from voting on such a transaction at the relevant stockholders meeting.
A stockholder that votes on a transaction in which its interest conflicts with that of ASUR may be
liable for damages in the event the relevant transaction would not have been approved without such
stockholders vote.
120
Directors Conflict of Interest
Under Mexican law, any director who has a conflict of interest with ASUR in any transaction
must disclose the conflict to the other directors and abstain from voting. Any director who
violates such provision will be liable to us for any resulting damages or losses. Additionally,
our directors may not represent stockholders in the stockholders meetings.
MATERIAL CONTRACTS
Our subsidiaries are parties to the airport concessions granted by the Ministry of
Communications and Transportation under which we are required to construct, operate, maintain and
develop the airports in exchange for certain benefits. See Sources of Regulation and Scope of
Concessions and General Obligations of Concession Holders under Regulatory Framework in Item 4.
We are a party to a participation agreement with ITA and the Ministry of Communications and
Transportation which establishes the framework for several other agreements to which we are a
party. See Item 7. Major Shareholders and Related Party TransactionsRelated Party
TransactionsArrangements with ITA.
We have entered into a technical assistance agreement and option agreement with ITA providing
for management and consulting services. See Item 7. Major Shareholders and Related Party
TransactionsRelated Party TransactionsArrangements with ITA.
EXCHANGE CONTROLS
Mexico has had free market for foreign exchange since 1991 and the government has allowed the
peso to float freely against the U.S. dollar since December 1994. There can be no assurance that
the government will maintain its current foreign exchange policies. See Item 3. Key
InformationExchange Rates.
TAXATION
The following summary contains a description of the material anticipated U.S. and Mexican
federal income tax consequences of the purchase, ownership and disposition of our Series B shares
or ADSs by a beneficial holder that is a citizen or resident of the United States or a U.S.
domestic corporation or that otherwise will be subject to U.S. federal income tax on a net income
basis in respect of our Series B shares or ADSs and that is a non-Mexican holder (as defined
below) (a U.S. holder), but it does not purport to be a comprehensive description of all of the
tax considerations that may be relevant to a decision to purchase our Series B shares or ADSs. In
particular, the summary deals only with U.S. holders that will hold our Series B shares or ADSs as
capital assets and does not address the tax treatment of special classes of U.S. holders such as
dealers in securities or currencies, U.S. holders whose functional currency is not the U.S. dollar,
U.S. holders that own or are treated as owning 10% or more of our outstanding voting shares,
tax-exempt organizations, financial institutions, U.S. holders liable for the alternative minimum
tax, securities traders who elect to account for their investment in Series B shares or ADSs on a
mark-to-market basis and persons holding Series B shares or ADSs in a hedging transaction or as
part of a straddle, conversion or other integrated transaction for U.S.
121
federal income tax purposes. In addition, the summary does not address any U.S. or Mexican
state or local tax considerations that may be relevant to a U.S. holder.
The summary is based upon the federal income tax laws of the United States and Mexico as in
effect on the date of this Form 20-F, including the provisions of the income tax treaty between the
United States and Mexico and protocol thereto (the Tax Treaty), all of which are subject to
change, possibly with retroactive effect in the case of U.S. federal income tax law. Prospective
investors in our Series B shares or ADSs should consult their own tax advisors as to the US,
Mexican or other tax consequences of the purchase, ownership and disposition of the Series B shares
or ADSs, including, in particular, the effect of any foreign, state or local tax laws and their
entitlement to the benefits, if any, afforded by the Tax Treaty.
For purposes of this summary, the term non-Mexican holder shall mean a holder that is not a
resident of Mexico and that will not hold the Series B shares or ADSs or a beneficial interest
therein in connection with the conduct of a trade or business through a permanent establishment or
fixed base in Mexico.
For purposes of Mexican taxation, the definition of residency is highly technical and
residency results in several situations. Generally an individual is a resident of Mexico if he or
she has established his or her home in Mexico, and a corporation is a resident if it is
incorporated under Mexican law or it has its center of interests in Mexico.
In general, for U.S. federal income tax purposes, holders of ADSs will be treated as the
beneficial owners of the Series B shares represented by those ADSs.
Taxation of Dividends
Mexican Tax Considerations
Under Mexican Income Tax Law provisions, dividends paid to non-Mexican holders with respect to
our Series B shares or ADSs are not subject to any Mexican withholding tax.
U.S. Federal Income Tax Considerations
The gross amount of any distributions paid with respect to the Series B shares or ADSs, to the
extent paid out of our current or accumulated earnings and profits, as determined for U.S. federal
income tax purposes, generally will be includible in the gross income of a U.S. holder as ordinary
income on the date on which the distributions are received by the depositary and will not be
eligible for the dividends received deduction allowed to certain corporations under the U.S.
Internal Revenue Code of 1986, as amended. To the extent that a distribution exceeds our current
and accumulated earnings and profits, it will be treated as a non-taxable return of basis to the
extent thereof, and thereafter as capital gain from the sale of Series B shares or ADSs.
Distributions, which will be made in pesos, will be includible in the income of a U.S. holder in a
U.S. dollar amount calculated by reference to the exchange rate in effect on the date they are
received by the depositary whether or not they are converted into U.S. dollars. If such
122
distributions are converted into U.S. dollars on the date of receipt, a U.S. holder generally
should not be required to recognize foreign currency gain or loss in respect of the distributions.
Subject to certain exceptions for short-term and hedged positions, the U.S. dollar amount of
dividends received by an individual U.S. holder prior to January 1, 2011 with respect to the ADSs
will be subject to taxation at a maximum rate of 15% if the dividends are qualified dividends.
Dividends paid on the ADSs will be treated as qualified dividends if: (i) the ADSs are readily
tradable on an established securities market in the United States, and (ii) the issuer was not, in
the year prior to the year in which the dividend was paid, and is not, in the years in which the
dividend is paid, a passive foreign investment company (PFIC). The ADSs are listed on the New York
Stock Exchange, and will qualify as readily tradable on an established securities market in the
United States so long as they are so listed. Based on our audited financial statements and relevant
market and shareholder data, we believe that we were not treated as a PFIC for U.S. federal income
tax purposes with respect to our 2006 taxable year. In addition, based on our audited financial
statements and our current expectations regarding the value and nature of our assets, the sources
and nature of our income, and relevant market and shareholder data, we do not anticipate becoming a
PFIC for our 2007 taxable year.
The U.S. Treasury has announced its intention to promulgate rules pursuant to which holders of
ADSs or common stock and intermediaries through whom such securities are held will be permitted to
rely on certifications from issuers to establish that dividends are treated as qualified dividends.
Because such procedures have not yet been issued, it is not clear whether we will be able to comply
with them. Holders of ADSs and common shares should consult their own tax advisors regarding the
availability of the reduced dividend tax rate in the light of their own particular circumstances.
Taxation of Dispositions of Shares or ADSs
Mexican Tax Considerations
Gain on the sale or other disposition of ADSs by a non-Mexican holder will not be subject to
any Mexican tax. Deposits and withdrawals of our Series B shares in exchange for ADSs will not
give rise to Mexican tax or transfer duties.
Gain on the sale of our Series B shares by a non-Mexican holder will not be subject to any
Mexican tax if the transaction is carried out through the Mexican Stock Exchange or other
securities markets approved by the Mexican Ministry of Finance, and provided certain requirements
set forth by the Mexican Income Tax Law are complied with. Sales or other dispositions of Series B
shares made in other circumstances generally would be subject to Mexican tax, except to the extent
that a holder is eligible for benefits under an income tax treaty to which Mexico is a party.
Under the Tax Treaty, a holder that is eligible to claim the benefits of the Tax Treaty will
be exempt from Mexican tax on gains realized on a sale or other disposition of the Series B shares
in a transaction that is not carried out through the Mexican Stock Exchange or such other approved
securities markets, so long as the holder did not own, directly or indirectly, 25% or
123
more of our capital stock (including ADSs) within the 12-month period preceding such sale or
other disposition.
For non-Mexican holders that do not meet the requirements referred to above, gross income
realized on the sale of the Series B shares will be subject to a 5% Mexican withholding tax if the
transaction is carried out through the Mexican Stock Exchange. Alternatively, a non-Mexican holder
can choose to be subject to a 20% withholding rate on the net gain obtained, as calculated pursuant
to Mexican Income Tax Law provisions.
U.S. Tax Considerations
Upon the sale or other disposition of the Series B shares or ADSs, a U.S. holder generally
will recognize capital gain or loss in an amount equal to the difference between the amount
realized on the sale or other disposition and such U.S. holders tax basis in the Series B shares
or ADSs. Gain or loss recognized by a U.S. holder on such sale or other disposition generally will
be long-term capital gain or loss if, at the time of the sale or other disposition, the Series B
shares or ADSs have been held for more than one year. Long-term capital gain recognized by a U.S.
holder that is an individual is subject to lower rates of federal income taxation than ordinary
income or short-term capital gain. The deduction of a capital loss is subject to limitations for
U.S. federal income tax purposes. Deposits and withdrawals of Series B shares by U.S. holders in
exchange for ADSs will not result in the realization of gain or loss for U.S. federal income tax
purposes.
Gain, if any, realized by a U.S. holder on the sale or other disposition of the Series B
shares or ADSs generally will be treated as U.S. source income for U.S. foreign tax credit
purposes. Consequently, if a Mexican withholding tax is imposed on the sale or disposition of the
Series B shares, a U.S. holder that does not receive significant foreign source income from other
sources may not be able to derive effective U.S. foreign tax credit benefits in respect of these
Mexican taxes. U.S. holders should consult their own tax advisors regarding the application of the
foreign tax credit rules to their investment in, and disposition of, Series B shares.
Other Mexican Taxes
There are no Mexican inheritance, succession or value added taxes applicable to the ownership,
transfer or disposition of the Series B shares or ADSs by non-Mexican holders; provided, however,
that gratuitous transfers of the Series B shares or ADSs may in certain circumstances cause a
Mexican federal tax to be imposed upon the recipient. There are no Mexican stamp, issue,
registration or similar taxes or duties payable by non-Mexican holders of the Series B shares or
ADSs.
U.S. Backup Withholding Tax and Information Reporting Requirements
In general, information reporting requirements will apply to payments by a paying agent within
the United States to a non-corporate (or other non-exempt) U.S. holder of dividends in respect of
the Series B shares or ADSs or the proceeds received on the sale or other disposition of the Series
B shares or ADSs, and a backup withholding tax may apply to such amounts if the U.S. holder fails
to provide an accurate taxpayer identification number to the paying agent.
124
Amounts withheld as backup withholding tax will be creditable against the U.S. holders U.S.
federal income tax liability, provided that the required information is furnished to the U.S.
Internal Revenue Service.
125
DOCUMENTS ON DISPLAY
The materials included in this annual report on Form 20-F, and exhibits hereto, may be viewed
at the U.S. Securities and Exchange Commissions public reference room in Washington, D.C. Please
call the Commission at 1-800-SEC-0330 for further information on the public reference rooms. The
Securities and Exchange Commission maintains a World Wide Web site on the Internet at
http://www.sec.gov that contains reports and information statements and other information regarding
us. The reports and information statements and other information about us can also be downloaded
from the Securities and Exchange Commissions website.
126
Item 11. Quantitative and Qualitative Disclosures About Market Risk
Market Risk
We are principally exposed to market risks from fluctuations in foreign currency exchange
rates.
Foreign Currency Exchange Rate Risk
Our principal exchange rate risk involves changes in the value of the peso relative to the
dollar. Historically, a significant portion of the revenues generated by our airports (principally
derived from passenger charges for international passengers) has been denominated in or linked to
the U.S. dollar, although such revenues are collected in pesos based on the average exchange rate
for the prior month. In 2004, 2005 and 2006, approximately 42.1%, 38.1% and 35.1%, respectively,
of our consolidated revenues were derived from passenger charges for international passengers.
Substantially all of our other revenues are denominated in pesos. We estimate that substantially
all of our consolidated costs and expenses are denominated in pesos (other than the salaries of our
executive officers and the technical assistance fee, to the extent paid based on the fixed minimum
annual payment). Based upon a 1.7% depreciation of the peso compared to the U.S. dollar as of
December 31, 2006, we estimate that our revenues would have decreased by Ps. 10.2 million.
As of December 31, 2004, 2005 and 2006, 53.8%, 13.9% and 8.22%, respectively, of our cash and
marketable securities were denominated in dollars. Based upon a 1.7% depreciation of the peso
compared to the U.S. dollar as of December 31, 2006, we estimate that the value of our cash and
marketable securities would have increased by Ps. 1.7 million.
We did not have any foreign currency indebtedness at December 31, 2004, 2005 and 2006. In the
event that we incur foreign currency denominated indebtedness in the future, decreases in the value
of the peso relative to the dollar will increase the cost in pesos of servicing such indebtedness.
At December 31, 2004, 2005 and 2006, we did not have any outstanding forward foreign exchange
contracts.
Item 12. Description of Securities Other Than Equity Securities
Not applicable.
127
PART II
Item 13. Defaults, Dividend Arrearages and Delinquencies
Not applicable.
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
Not applicable.
Item 15. Controls and Procedures
Disclosure Controls and Procedures
We have evaluated, with the participation of our chief executive officer and chief financial
officer, the effectiveness of our disclosure controls and procedures as of December 31, 2006. There
are inherent limitations to the effectiveness of any system of disclosure controls and procedures,
including the possibility of human error and the circumvention or overriding of the controls and
procedures. Accordingly, even effective disclosure controls and procedures can only provide
reasonable assurance of achieving their control objectives. Based upon our evaluation, our chief
executive officer and chief financial officer concluded that our disclosure controls and procedures
were effective to provide reasonable assurance that information required to be disclosed by us in
the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is
recorded, processed, summarized and reported, within the time periods specified in the applicable
rules and forms, and that it is accumulated and communicated to our management, including our chief
executive officer and chief financial officer, as appropriate to allow timely decisions regarding
required disclosure.
Managements Report on Internal Control Over Financial Reporting
The management
of ASUR is responsible for establishing and maintaining adequate internal
control over financial reporting. The companys internal control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. We conducted an assessment of the effectiveness of our internal
controls over financial reporting as of December 31, 2006 using the criteria set forth
in the Internal Control Integrated Framework published by the
Committee of Sponsoring Organizations of the Treadway Commission.
128
Because of its inherent limitations, internal control over financial reporting may not prevent
or detect misstatements. Also, projections of any evaluation of the effectiveness to future periods
are subject to the risk that controls may become inadequate because of changes in conditions, and
that the degree of compliance with the policies or procedures may deteriorate.
Based on its assessment
and using the criteria discussed above, ASURs management has concluded that the companys internal
control over financial reporting was effective as of December 31, 2006.
PricewaterhouseCoopers, the independent registered public accounting firm that has audited our
financial statements, has issued an attestation report on managements assessment of the companys
internal control over financial reporting.
Changes
in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting during 2006 that has
materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.
Item 16. [Reserved]
Item 16A. Audit Committee Financial Expert
Our board of directors has designated George J. Vojta, an independent director as required by
the Mexican Securities Market Law and applicable NYSE listing standards, as an audit committee
financial expert within the meaning of this Item 16A. See Item 6. Directors, Senior Management
and EmployeesDirectors.
Item 16B. Code of Ethics
We have adopted a code of ethics, as defined in Item 16B of Form 20-F under the Securities
Exchange Act of 1934, as amended. Our code of ethics applies to our chief executive officer, chief
financial officer, chief accounting officer and persons performing similar functions
as well as to our other officers and employees. Our code of ethics is filed as an exhibit to
this Form 20-F and is available on our website at www.asur.com.mx. If we amend the provisions of
our code of ethics that apply to our chief executive officer, chief financial officer, chief
accounting officer and persons performing similar functions, or if we grant any waiver of such
provisions, we will disclose such amendment or waiver on our website at the same address.
129
Item 16C. Principal Accountant Fees and Services
Audit and Non-Audit Fees
The following table sets forth the fees billed to us by our independent auditors,
PricewaterhouseCoopers, during the fiscal years ended December 31, 2005 and 2006:
|
|
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|
|
|
|
Year ended December 31, |
|
|
2005 |
|
2006 |
|
|
(thousands of pesos) |
Audit fees |
|
|
4,515 |
|
|
|
5,269 |
|
Audit-related fees |
|
|
|
|
|
|
|
|
Tax fees |
|
|
177 |
|
|
|
37 |
|
Other fees |
|
|
1,871 |
|
|
|
4,285 |
|
|
|
|
|
|
|
|
|
|
Total fees |
|
|
6,563 |
|
|
|
9,591 |
|
|
|
|
|
|
|
|
|
|
Audit fees in the above table are the aggregate fees billed by PricewaterhouseCoopers in
connection with the audit of our annual financial statements and the review of our interim
financial statements.
Tax fees in the above table are fees billed by PricewaterhouseCoopers for tax compliance.
Other fees in the above table are fees billed by PricewaterhouseCoopers in 2006 for compliance
with the Sarbanes-Oxley Act of 2002.
Audit Committee Pre-Approval Policies and Procedures
Our audit committee has not established pre-approval policies and procedures for the
engagement of our independent auditors for services. Our audit committee expressly approves on a
case-by-case basis any engagement of our independent auditors for audit and non-audit services
provided to our subsidiaries or to us.
Item 16D. Exemptions from the Listing Standards for Audit Committees
Not applicable.
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
The table below sets forth, for the periods indicated, the total number of shares purchased by
us or on our behalf, or by an affiliated purchaser or on behalf of an affiliated purchaser, the
average price paid per share, the total number of shares purchased as a part of a publicly
announced repurchase plan or program and the maximum number (or approximate dollar value) of shares
that may yet be purchased under our plans and programs.
130
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|
|
(a) Total |
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|
|
|
|
(c) Total number of shares |
|
|
|
|
number of |
|
(b) Average |
|
purchased as part of |
|
(d) Maximum number of shares |
|
|
shares |
|
price paid per |
|
publicly announced plans or |
|
that may yet be purchased under |
2005 |
|
purchased |
|
share in Pesos |
|
programs |
|
the plans or programs |
January 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 1-28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
August 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2005 Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 1-28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
August 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 1-31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November 1-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 1-31 |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2006 Total |
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|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
On April 27, 2007, our stockholders approved the allocation of 35%, or Ps. 189.2 million, of
our net profits for the fiscal year ended December 31, 2006 to the share repurchase reserve
account. The stockholders approved the allocation of Ps. 257.7 million, or 44% of net profits, to
the share repurchase reserve in 2005.
PART III
Item 17. Financial Statements
Not applicable.
Item 18. Financial Statements
See pages F-1 through F-38, incorporated herein by reference. The following is an index to the
financial statements:
Consolidated Financial Statements for Grupo Aeroportuario del Sureste, S.A.B. de C.V.
and Subsidiaries
|
|
|
|
|
|
|
Page |
Report of Independent Registered Public Accounting Firm |
|
|
F-1 |
|
Consolidated Balance Sheets as of December 31, 2005 and 2006 |
|
|
F-3 |
|
Consolidated Statements of Income for the Years Ended December 31, 2004, 2005 and 2006 |
|
|
F-4 |
|
Consolidated Statements of Changes in Stockholders Equity for the Years Ended December 31, 2004, 2005 and 2006 |
|
|
F-5 |
|
Consolidated Statements of Changes in Financial Position for the Years Ended December 31, 2004, 2005 and 2006 |
|
|
F-6 |
|
Notes to Consolidated Financial Statements |
|
|
F-7 |
|
131
Item 19. Exhibits
Documents filed as exhibits to this annual report:
|
|
|
Exhibit No. |
|
Description |
|
1.1
|
|
An English translation of the Amended and Restated Bylaws (Estatutos Sociales) of
the Company. |
|
|
|
2.1
|
|
Deposit Agreement among the Company, The Bank of New York and all registered
holders from time to time of any American Depositary Receipts, including the form
of American Depositary Receipt (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
|
|
|
3.1
|
|
Trust Agreement among the Company, ITA and Bancomext, together with an English
translation (incorporated by reference to our registration statement on Form F-1
(File No. 333-12486) filed on September 7, 2000). |
|
|
|
3.2 |
|
Amendment dated May 15, 2007 to the Trust Agreement dated November 18, 1998 among the
Company, ITA and Bancomext, English translation. |
|
|
|
4.1
|
|
Amended and Restated Cancun Airport Concession Agreement and annexes thereto,
together with an English translation and a schedule highlighting the differences
between this concession and the Companys other concessions (incorporated by
reference to our registration statement on Form F-1 (File No. 333-12486) filed on
September 7, 2000). |
|
|
|
4.2
|
|
Participation Agreement among the Company, the Mexican Federal Government through
the Ministry of Communications and Transportation, Nacional Financiera, S.N.C.
(NAFIN), Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de
Cancun, S.A. de C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco,
S.A. de C.V., Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A.
de C.V., Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de
C.V., Aeropuerto de Veracruz, S.A. de C.V., Aeropuerto de Villahermosa, S.A. de
C.V., Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports,
Cintra Concesiones de Infraestructuras de Transporte, S.A., Groupe GTM, S.A.,
Inversiones y Tecnicas Aeroportuarias, S.A. de C.V. (ITA), Banco Nacional de
Comercio Exterior, S.N.C. (Bancomext) and Aeropuertos y Servicios Auxiliares
(ASA), together with an English translation (incorporated by reference to our
registration statement on Form F-1 (File No. 333-12486) filed on September 7,
2000). |
|
|
|
4.3
|
|
First Amendment to the Participation Agreement, the Shareholders Agreement and the
Technical Assistance Agreement among the Mexican Federal Government through the
Ministry of Communications and Transportation, NAFIN, Bancomext, the Company,
Servicios Aeroportuario del Sureste, S.A. de C.V., Aeropuerto de Cancun, S.A. de
C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de C.V.,
Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V.,
Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V.,
Aeropuerto de Veracruz, S.A. de C.V. and Aeropuerto de Villahermosa, S.A. de C.V.;
ITA, Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports,
Cintra Concesiones de Infraestructura de Transporte, S.A. de C.V. and Groupe GTM,
S.A. (incorporated by reference to our registration statement on Form F-1 (File
No. 333-12486) filed on September 7, 2000). |
|
|
|
4.4 |
|
Second Amendment dated April 30, 2007 to the Participation Agreement dated December 18, 1998
among the Company, the Mexican Federal Government through the Ministry of Communications and
Transportation, NAFIN, Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de
Cancun, S.A. de C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de
C.V., Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V., Aeropuerto
de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V., Aeropuerto de Veracruz, S.A.
de C.V., Aeropuerto de Villahermosa, S.A. de C.V., Triturados Basalticos y Derivados, S.A. de
C.V., Copenhagen Airports, Cintra Concesiones de Infraestructuras de Transporte, S.A., Groupe
GTM, S.A., ITA, Bancomext, ASA and Fernando Chico Pardo, English translation. |
|
|
|
4.5 |
|
Technical Assistance and Transfer of Technology Agreement among the Company,
Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de Cancun, S.A. de
C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de C.V.,
Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V.,
Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V.,
Aeropuerto de Veracruz, S.A. de C.V., Aeropuerto de |
132
|
|
|
Exhibit No. |
|
Description |
|
|
|
Villahermosa, S.A. de C.V.,
Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports, Cintra
Concesiones de Infraestructuras de Transporte, S.A., VINCI, S.A. and ITA, together
with an English translation (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
|
|
|
8.1
|
|
List of subsidiaries of the Company (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
|
|
|
11.1
|
|
Code of Ethics (incorporated by reference to our Form 20-F filed on June 16, 2004). |
|
|
|
12.1
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. |
|
|
|
12.2
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. |
|
|
|
13.1
|
|
Certifications of Chief Financial Officer and Chief Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
133
SIGNATURES
The registrant
hereby certifies that it meets all of the requirements for filing on
Form 20-F/A
and that it has duly caused and authorized the undersigned to sign
this annual report on
its behalf.
|
|
|
|
|
|
Grupo Aeroportuario del Sureste, S.A.B. de C.V.
|
|
|
By: |
/s/ Adolfo Castro Rivas |
|
|
|
Name: |
Adolfo Castro Rivas |
|
|
|
Title: |
Chief Financial Officer |
|
|
Dated:
July 31, 2007
134
GRUPO AEROPORTUARIO DEL SURESTE,
S.A.B. DE C.V. AND SUBSIDIARIES
CONSOLIDATED AUDITED FINANCIAL STATEMENTS
DECEMBER 31, 2004, 2005 AND 2006
INDEX
|
|
|
Contents |
|
Page |
|
|
|
|
|
F 1 |
|
|
|
Consolidated financial statements: |
|
|
|
|
|
|
|
F 3 |
|
|
|
|
|
F 4 |
|
|
|
|
|
F 5 |
|
|
|
|
|
F 6 |
|
|
|
|
|
F 7 |
F-i
Report of Independent Registered Public Accounting Firm
To the
Board of Directors and Shareholders of Grupo Aeroportuario del
Sureste, S.A.B. de C.V., and its subsidiaries:
We have
completed an integrated audit of Grupo Aeroportuario del Sureste,
S.A.B. de C.V.s (Southeast Airport Group) consolidated
financial statements and of its internal control over financial
reporting as of December 31, 2006 and audits of its 2005 and
2004 consolidated financial statements in accordance with the
standards of the Public Company Accounting Oversight Board (United
States). Our opinions, based on our audits, are presented below.
Consolidated
financial statements
In our
opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, of changes in stockholders
equity and of changes in financial position present fairly, in all
material respects, the financial position of Grupo Aeroportuario del
Sureste, S.A.B. de C.V. and its subsidiaries at December 31,
2006 and 2005, and the consolidated results of their operations and
their changes in the consolidated financial position for each of the
three years for the periods ended December 31, 2006, 2005 and
2004 in conformity with Mexican Financial Reporting Standards as
adopted by Mexico (MFRS). These consolidated financial statements are
the responsibility of the Companys management. Our
responsibility is to express an opinion on these consolidated
financial statements based on our audits. We conducted our audits of
these statements in accordance with the Standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are
free of material misstatement. An audit of consolidated financial
statements includes examining, on a test basis, evidence supporting
the amounts and disclosures in the consolidated financial statements,
assessing the accounting standards used and significant estimates
made by management, and evaluating the overall consolidated financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinions.
MFRS
vary in certain significant respects from generally accepted
accounting principles in the United States of America. Information
relating to the nature and effect of such differences is presented in
Note 16 to the above consolidated financial statements.
Internal
control over financial reporting
Also,
in our opinion, managements assessment, included in
Managements Report on Internal Control Over Financial
Reporting appearing under Item 15, that the Company
maintained effective internal control over financial reporting as of
December 31, 2006 based on criteria established in Internal
Control-Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO), is fairly
stated, in all material respects, based on those criteria.
Furthermore, in our opinion, the Company maintained, in all material
respects, effective internal control over financial reporting as of
December 31, 2006, based on criteria established in Internal
Control-Integrated Framework issued by the COSO. The
Companys management is responsible for maintaining effective
internal control over financial reporting and for its assessment of
the effectiveness of internal control over financial reporting. Our
responsibility is to express opinions on managements assessment
and on the effectiveness of the Companys internal control over
financial reporting based on our audit. We conducted our audit of
internal control over financial reporting in accordance with the
standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether effective internal
control over financial reporting was maintained in all material
respects. An audit of internal control over financial reporting
includes obtaining an understanding of internal control over
financial reporting, evaluating managements assessment, testing
and evaluating the design and operating effectiveness of internal
control, and performing such other procedures as we consider
necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinions.
A
companys internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of consolidated financial
statements for external purposes in accordance with generally
accepted accounting principles. A companys internal control
over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide
reasonable assurance that transactions are recorded as necessary to
permit preparation of consolidated financial statements in accordance
with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and
(iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of
the companys assets that could have a material effect on the
consolidated financial statements.
F - 1
Because
of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or
procedures may deteriorate.
/s/
PricewaterhouseCoopers
Mexico
City, June 22, 2007
F - 2
GRUPO AEROPORTUARIO DEL SURESTE, S.A.B. DE C.V. AND SUBSIDIARIES
(SOUTHEAST AIRPORT GROUP)
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2005 AND 2006
(Expressed in thousands of Mexican Pesos in purchasing power as of December 31, 2006)
|
|
|
|
|
|
|
|
|
|
|
2005 |
|
|
2006 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and marketable securities |
|
Ps. |
1,595,743 |
|
|
Ps. |
1,241,678 |
|
Trade and other receivables, net (Note 3) |
|
|
169,413 |
|
|
|
235,541 |
|
Recoverable taxes and other current assets |
|
|
168,775 |
|
|
|
163,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
1,933,931 |
|
|
|
1,640,690 |
|
Improvements to concessioned assets, land, machinery, furniture and
equipment, net of accumulated depreciation of Ps.384,865
and Ps.534,573, respectively (Note 4) |
|
|
2,265,914 |
|
|
|
3,149,358 |
|
Direct commercial operations rights, net of
accumulated amortization of Ps.26,263 and Ps.41,581, respectively |
|
|
57,201 |
|
|
|
41,883 |
|
Airport concessions, net of accumulated amortization of
Ps.1,743,223 and Ps.1,992,100, respectively (Notes 5 and 6) |
|
|
8,193,031 |
|
|
|
7,944,154 |
|
Rights to use airport facilities, net of accumulated
amortization of Ps.618,170 and Ps.685,305,
respectively (Notes 5 and 6) |
|
|
2,183,373 |
|
|
|
2,165,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
Ps. |
14,633,450 |
|
|
Ps. |
14,941,401 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Trade accounts payable |
|
Ps. |
22,834 |
|
|
Ps. |
6,244 |
|
Accrued expenses and other payables (Note 7) |
|
|
344,330 |
|
|
|
239,097 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
367,164 |
|
|
|
245,341 |
|
|
|
|
|
|
|
|
|
|
Seniority premiums |
|
|
6,548 |
|
|
|
7,511 |
|
Deferred income tax and employees statutory profit
sharing |
|
|
706,041 |
|
|
|
903,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
1,079,753 |
|
|
|
1,156,300 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (Note 14) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders equity (Note 8): |
|
|
|
|
|
|
|
|
Capital stock |
|
|
12,335,507 |
|
|
|
12,335,507 |
|
Legal reserve |
|
|
106,694 |
|
|
|
135,686 |
|
Reserve for repurchase of stock |
|
|
525,479 |
|
|
|
779,657 |
|
Retained earnings |
|
|
586,017 |
|
|
|
534,251 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
13,553,697 |
|
|
|
13,785,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
Ps. |
14,633,450 |
|
|
Ps. |
14,941,401 |
|
|
|
|
|
|
|
|
The sixteen notes are part of these consolidated financial statements, which were authorized for
its emission dated April 18, 2007, by the executive that
signed completely these consolidated
financial statements and its notes.
C.P.A. Adolfo Castro Rivas
Chief Financial and Strategic Planning Officer
Grupo Aeroportuario del Sureste, S.A.B. de C.V.
F - 3
GRUPO AEROPORTUARIO DEL SURESTE, S.A.B. DE C.V. AND SUBSIDIARIES
(SOUTHEAST AIRPORT GROUP)
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2004, 2005 AND 2006
(Expressed in thousands of Mexican Pesos in purchasing power as of
December 31, 2006, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years |
|
|
|
ended December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
REVENUES: |
|
|
|
|
|
|
|
|
|
|
|
|
Aeronautical services |
|
Ps. |
1,602,630 |
|
|
Ps. |
1,520,152 |
|
|
Ps. |
1,587,904 |
|
Non-aeronautical services |
|
|
521,961 |
|
|
|
627,308 |
|
|
|
651,057 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
|
|
2,124,591 |
|
|
|
2,147,460 |
|
|
|
2,238,961 |
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services, excluding depreciation and amortization |
|
|
502,494 |
|
|
|
558,116 |
|
|
|
620,036 |
|
Technical assistance fee |
|
|
71,991 |
|
|
|
69,123 |
|
|
|
71,037 |
|
Concession fee |
|
|
106,189 |
|
|
|
107,373 |
|
|
|
111,804 |
|
General and administrative expenses |
|
|
113,710 |
|
|
|
129,384 |
|
|
|
118,628 |
|
Depreciation and amortization |
|
|
429,597 |
|
|
|
451,674 |
|
|
|
487,788 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
|
1,223,981 |
|
|
|
1,315,670 |
|
|
|
1,409,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
900,610 |
|
|
|
831,790 |
|
|
|
829,668 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE FINANCING RESULT: |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, net |
|
|
48,864 |
|
|
|
106,689 |
|
|
|
99,579 |
|
Exchange (losses) gains, net |
|
|
(7,477 |
) |
|
|
(16,786 |
) |
|
|
3,957 |
|
Loss from monetary position |
|
|
(72,253 |
) |
|
|
(66,234 |
) |
|
|
(88,322 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net comprehensive financing (cost) income |
|
|
(30,866 |
) |
|
|
23,669 |
|
|
|
15,214 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes, employees statutory profit
sharing and extraordinary items |
|
|
869,744 |
|
|
|
855,459 |
|
|
|
844,882 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions for (Note 11): |
|
|
|
|
|
|
|
|
|
|
|
|
Asset tax |
|
|
25,482 |
|
|
|
22,503 |
|
|
|
21,679 |
|
Deferred income tax and employees statutory
profit sharing |
|
|
172,571 |
|
|
|
237,612 |
|
|
|
279,434 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before extraordinary items |
|
|
671,691 |
|
|
|
595,344 |
|
|
|
543,769 |
|
Restructuring and contract termination fees, net of
deferred income taxes of Ps.4,565 , Ps. 0
and Ps.123, respectively |
|
|
19,046 |
|
|
|
|
|
|
|
8,480 |
|
Loss on natural disaster, net of deferred income
taxes of Ps. 0, Ps.2,995 and Ps.2,341, in 2005 and 2006,
respectively |
|
|
|
|
|
|
9,327 |
|
|
|
7,174 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
Ps. |
652,645 |
|
|
Ps. |
586,017 |
|
|
Ps. |
528,115 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share (Note 8) |
|
Ps. |
2.18 |
|
|
Ps. |
1.95 |
|
|
Ps. |
1.76 |
|
|
|
|
|
|
|
|
|
|
|
The sixteen notes are part of these consolidated financial statements, which were authorized for
its emission dated April 18, 2007, by the executive that
signed completely these consolidated
financial statements and its notes.
C.P.A. Adolfo Castro Rivas
Chief Financial and Strategic Planning Officer
Grupo Aeroportuario del Sureste, S.A.B. de C.V.
F - 4
GRUPO AEROPORTUARIO DEL SURESTE, S.A.B. DE C.V. AND SUBSIDIARIES
(SOUTHEAST AIRPORT GROUP)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
FOR THE YEARS ENDED ON DECEMBER 31, 2004, 2005 AND 2006
(Expressed in thousands of Mexican Pesos in purchasing power as of December 31, 2006)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reserve for |
|
|
|
|
|
|
Total |
|
|
|
Capital |
|
|
Legal |
|
|
repurchase |
|
|
Retained |
|
|
stockholders |
|
|
|
stock |
|
|
reserve |
|
|
of stock |
|
|
earnings |
|
|
equity |
|
|
Balance at December 31, 2003 |
|
Ps. |
12,335,507 |
|
|
Ps. |
58,442 |
|
|
Ps. |
- |
|
|
Ps. |
440,284 |
|
|
Ps. |
12,834,233 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer to legal reserve |
|
|
|
|
|
|
15,620 |
|
|
|
|
|
|
|
(15,620 |
) |
|
|
- |
|
Transfer to reserve for repurchase
of stock |
|
|
|
|
|
|
|
|
|
|
171,947 |
|
|
|
(171,947 |
) |
|
|
- |
|
Recovered income tax paid on
dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,939 |
|
|
|
25,939 |
|
Dividends paid |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(190,013 |
) |
|
|
(190,013 |
) |
Income tax paid on dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(69,422 |
) |
|
|
(69,422 |
) |
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
652,645 |
|
|
|
652,645 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2004 |
|
|
12,335,507 |
|
|
|
74,062 |
|
|
|
171,947 |
|
|
|
671,866 |
|
|
|
13,253,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer to legal reserve |
|
|
|
|
|
|
32,632 |
|
|
|
|
|
|
|
(32,632 |
) |
|
|
- |
|
Transfer to reserve for repurchase
of stock |
|
|
|
|
|
|
|
|
|
|
353,532 |
|
|
|
(353,532 |
) |
|
|
- |
|
Dividends paid |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(199,989 |
) |
|
|
(199,989 |
) |
Income tax paid on dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(85,713 |
) |
|
|
(85,713 |
) |
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
586,017 |
|
|
|
586,017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2005 |
|
|
12,335,507 |
|
|
|
106,694 |
|
|
|
525,479 |
|
|
|
586,017 |
|
|
|
13,553,697 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer to legal reserve |
|
|
|
|
|
|
28,992 |
|
|
|
|
|
|
|
(28,992 |
) |
|
|
- |
|
Transfer to reserve for repurchase
of stock |
|
|
|
|
|
|
|
|
|
|
254,178 |
|
|
|
(254,178 |
) |
|
|
- |
|
Dividends paid |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(210,663 |
) |
|
|
(210,663 |
) |
Income tax paid on dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(86,048 |
) |
|
|
(86,048 |
) |
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
528,115 |
|
|
|
528,115 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2006 |
|
Ps. |
12,335,507 |
|
|
Ps. |
135,686 |
|
|
Ps. |
779,657 |
|
|
Ps. |
534,251 |
|
|
Ps. |
13,785,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The sixteen notes are part of these consolidated financial statements, which were authorized for
its emission dated April 18, 2007, by the executive that
signed completely these consolidated
financial statements and its notes.
C.P.A. Adolfo Castro Rivas
Chief Financial and Strategic Planning Officer
Grupo Aeroportuario del Sureste, S.A.B. de C.V.
F - 5
GRUPO AEROPORTUARIO DEL SURESTE, S.A.B. DE C.V. AND SUBSIDIARIES
(SOUTHEAST AIRPORT GROUP)
CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
FOR THE YEARS ENDED DECEMBER 31, 2004, 2005 AND 2006
(Expressed in thousands of Mexican Pesos in purchasing power as of December 31, 2006)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years |
|
|
|
ended
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
Operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income before extraordinary items |
|
Ps. |
671,691 |
|
|
Ps. |
595,344 |
|
|
Ps. |
543,769 |
|
Adjustments to reconcile net income to
resources provided by (used in)
operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
429,597 |
|
|
|
451,674 |
|
|
|
487,788 |
|
Deferred income tax and employees
statutory profit sharing |
|
|
172,571 |
|
|
|
237,612 |
|
|
|
279,434 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Trade receivables |
|
|
(35,435 |
) |
|
|
58,849 |
|
|
|
(66,128 |
) |
Recoverable taxes and other current assets |
|
|
95,448 |
|
|
|
(104,839 |
) |
|
|
5,304 |
|
Recoverable asset tax |
|
|
(160,988 |
) |
|
|
(119,108 |
) |
|
|
(99,673 |
) |
Trade accounts payable, accrued expenses
and other payables |
|
|
53,429 |
|
|
|
178,259 |
|
|
|
(103,214 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources provided by operating activities
before extraordinary items |
|
|
1,226,313 |
|
|
|
1,297,791 |
|
|
|
1,047,280 |
|
Restructure and contract termination fees |
|
|
(19,046 |
) |
|
|
- |
|
|
|
(8,480 |
) |
Loss on natural disaster |
|
|
- |
|
|
|
(9,327 |
) |
|
|
(7,174 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources provided by operating activities |
|
|
1,207,267 |
|
|
|
1,288,464 |
|
|
|
1,031,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid |
|
|
(190,013 |
) |
|
|
(199,989 |
) |
|
|
(210,663 |
) |
Tax on dividends paid |
|
|
(69,422 |
) |
|
|
(85,713 |
) |
|
|
(86,048 |
) |
Recovered income tax paid on dividends |
|
|
25,939 |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources used in financing activities |
|
|
(233,496 |
) |
|
|
(285,702 |
) |
|
|
(296,711 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Direct commercial operations rights |
|
|
(83,464 |
) |
|
|
- |
|
|
|
- |
|
Purchase of improvements to concessioned assets,
land, machinery, furniture and equipment |
|
|
(442,937 |
) |
|
|
(657,830 |
) |
|
|
(1,088,980 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Resources used in investing activities |
|
|
(526,401 |
) |
|
|
(657,830 |
) |
|
|
(1,088,980 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase in cash and marketable
securities |
|
|
447,370 |
|
|
|
344,932 |
|
|
|
(354,065 |
) |
Cash and marketable securities, beginning
of period |
|
|
803,441 |
|
|
|
1,250,811 |
|
|
|
1,595,743 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and marketable securities, end of
period |
|
Ps. |
1,250,811 |
|
|
Ps. |
1,595,743 |
|
|
Ps. |
1,241,678 |
|
|
|
|
|
|
|
|
|
|
|
The sixteen notes are part of these consolidated financial statements, which were authorized for
its emission dated April 18, 2007, by the executive that
signed completely these consolidated
financial statements and its notes.
C.P.A. Adolfo Castro Rivas
Chief Financial and Strategic Planning Officer
Grupo Aeroportuario del Sureste, S.A.B. de C.V.
F - 6
GRUPO AEROPORTUARIO DEL SURESTE, S.A.B. DE C.V. AND SUBSIDIARIES
(SOUTHEAST AIRPORT GROUP)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in thousands of Mexican Pesos in purchasing power
as of December 31, 2006, except per share and share amounts)
1. Formation and Description of Business
Grupo Aeroportuario del Sureste, S.A.B. de C.V. (ASUR), a Mexican company, was incorporated in
April 1998, as a wholly-owned entity of the Mexican government to operate, maintain and develop
nine airports in the Southeast region of Mexico. The nine airports are located in the following
cities: Cancún, Cozumel, Mérida, Huatulco, Oaxaca, Veracruz, Villahermosa, Tapachula and
Minatitlán. ASUR and its subsidiaries are collectively referred to as the Company.
In June 1998, the Ministry of Communications and Transportation granted to subsidiaries of ASUR the
concessions to operate, maintain and develop the nine airports of the Southeast group for a period
of 50 years commencing on November 1, 1998, for Ps.12,249,946 (December 31, 2006 constant pesos),
excluding value added tax. The concession period may be extended by the parties under certain
circumstances. The acquisition cost of the airport concessions was paid through the issuance of
capital stock of ASUR (see Note 8). Beginning November 1, 1998, the Company is required to pay the
Mexican government annual concession fees currently equal to 5% of each concession holders gross
annual revenues for the use of public domain assets pursuant to the terms of its concessions.
Notwithstanding the Companys rights to operate, maintain and develop the nine airports, pursuant
to the Mexican General Law of National Assets, all the permanent fixed assets in the airports are
owned by the Mexican nation. Upon expiration of the Companys concessions, these assets, including
any improvements made during the term of the concessions, automatically revert to the Mexican
nation.
In December 1998 and in March 1999, the Mexican government sold an aggregate 15% equity interest in
ASUR to Inversiones y Técnicas Aeroportuarias, S.A. de C.V. (ITA), pursuant to a public bidding
process. ITA paid the Mexican government an aggregate of Ps.1,165,076 (nominal), excluding
interest, in exchange for: (i) 45,000,000 Class I Series BB shares representing 15% of ASURs
capital stock; (ii) options to purchase newly issued shares representing 2%, 2% and 1% of total
shares outstanding at the time of exercise, each determined on a fully diluted basis, from December
18, 2001 to December 18, 2005; and (iii) the right and obligation to enter into several agreements,
including a technical assistance agreement, under terms established during the bidding process.
With respect to the ASUR shares not held by ITA, on September 28, 2000, the Mexican government held
a public offer for 221,739,130 Series B shares representing 73.9% ASURs shares. On March 8,
2005, the Mexican government held a public offer for 33,260,870 Series B shares represented 11.1%
ASURs remaining shares it owned. As of December 31, 2005 and 2006, ASURs shareholders are
represented by public investors (85%) and ITA (15%).
F - 7
Series BB shares held by ITA grant ITA certain rights including the right to name two members of
the Board of Directors of the Company, and veto rights with respect to certain corporate shares.
The technical assistance contract grants ITA certain rights including the right to name and remove
the chief executive officer, and half the members of the Companys Executive Management.
On April 27, 2006, in compliance with the provisions of the Mexican Stock Market Law (Ley del
Mercado de Valores) published on December 30, 2006, the Companys shareholders resolved at an
Extraordinary General Meeting to change the name of the Company from Grupo Aeroportuario del
Sureste, S.A. de C.V. to Grupo Aeroportuario del Sureste, S.A.B. de C.V. They also amended the
Company bylaws to reflect the new composition, organization and functions of the Companys
corporate governance bodies and the new rights of minority shareholders.
In October 2005, Hurricane Wilma caused severe damage to large portions of Cancun, Mexico. The
storm resulted in extensive flooding in Cancun and Cozumel airports, severe damage in Terminal 1
building and damage (electrical installations, other equipment, etc.) in Terminal 2 building and
corporate offices building in Cancun airport.
As a result, as of December 31, 2005 the Company wrote off Terminal 1 building, provided for the
estimated restoration costs for Terminal 2 building and corporate offices building in Cancun
airport, and incurred other losses, all classified as loss on natural disasters in the results of
operations of the year as indicated in the table below. In addition, the Company recorded an asset
related to the insurance recovery for the loss recognized in the consolidated financial statements
related to the effects of Hurricane Wilma.
In July 2006, the Company was instructed by the Mexican Government to repair the Terminal 1
building and therefore the Company reversed a portion of the 2005 write-off related to certain
assets of Terminal 1 which were once again to be placed in service. In addition, during 2006, the
Company recognized the actual restoration costs on the Terminal 2 building and corporate offices
and the insurance remaining settlement amounts. As of December 2006 and 2005, the balance of the
account receivable from the insurance company amounted to Ps.0 and Ps. 44 million, respectively.
The components of the loss on natural disaster for the years ended December 31, 2006 and 2005 are
as follows:
|
|
|
|
|
|
|
|
|
|
|
2005 |
|
|
2006 |
|
Terminal 1 building write-off (reversal) |
|
Ps. |
57,194 |
|
|
( Ps.48,544) |
Restoration costs |
|
|
104,608 |
|
|
|
60,038 |
|
Insurance deductible |
|
|
3,746 |
|
|
|
- |
|
Other expenses |
|
|
7,326 |
|
|
|
- |
|
Other losses for natural disasters in other airports |
|
|
1,251 |
|
|
|
1,522 |
|
Insurance recovery |
|
|
(161,803 |
) |
|
|
(3,501 |
) |
Deferred taxes |
|
|
(2,995 |
) |
|
|
(2,341 |
) |
|
|
|
|
|
|
|
Net loss on natural disasters |
|
Ps. |
9,327 |
|
|
Ps. |
7,174 |
|
|
|
|
|
|
|
|
F - 8
2. Summary of significant accounting policies
The consolidated financial statements have been prepared in accordance with Mexican Financial
Reporting Standards (Normas de Información Financiera or NIF) as promulgated by the Mexican
Financial Reporting Standards Board (Consejo Mexicano para la Investigación y Desarrollo de Normas
de Información Financiera or CINIF).
Beginning June 1, 2004, the CINIF assumed the responsibility for setting accounting and reporting
standards in Mexico. In compliance with this responsibility, the CINIF issued several NIF that
became effective on January 1, 2006. These dispositions did not have a significant impact on the
consolidated financial statements.
The principal accounting policies followed by the Company are as follows:
a) Basis of presentation
All significant intercompany balances and transactions have been eliminated. The consolidated
Subsidiaries of the Company are:
|
|
|
|
|
|
|
|
|
Subsidiary |
|
Ownership interest (direct and indirect) |
|
|
|
2005 |
|
2006 |
|
Aeropuerto de Cancún, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Cozumel, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Mérida, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Huatulco, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Oaxaca, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Veracruz, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Villahermosa, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Tapachula, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Aeropuerto de Minatitlán, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
Servicios Aeroportuarios del Sureste, S. A. de C. V. |
|
|
99.99 |
% |
|
|
99.99 |
% |
The preparation of consolidated financial statements in conformity with Mexican Financial Reporting
Standards requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at the date of the
consolidated financial statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
b) Recognition of the effects of inflation
The consolidated financial statements have been prepared in accordance with Bulletin B-10,
Recognition of the Effects of Inflation on Financial Information (Bulletin B-10), and
determined as follows:
F - 9
|
|
The consolidated statements of income and changes in
stockholders equity were restated applying Mexican National
Consumer Price Index (Mexican CPI) factors from the periods
in which the transactions occurred. The consolidated financial
statements of the Company for the years ended December 31,
2004 and 2005, have been restated for comparability purposes
to December 31, 2006 purchasing power, by applying the
restatement factors of 1.075 and 1.040, respectively. |
|
|
|
The consolidated statements of changes in financial
position present, in constant pesos, the resources provided by
or used in operating, financing and investing activities. |
The methodology for the restatement of the individual financial statement items is as
follows:
Restatement of non-monetary assets:
Machinery, furniture and equipment, net are recorded at acquisition cost, restated using Mexican
CPI factors from the date the asset was purchased to the date of the financial statements.
Depreciation expense is based on the restated carrying value of the assets.
The rights to use the airport facilities, net and the airport concessions, net were recorded based
on the allocation of the purchase cost of the airport concessions and the acquisition cost of the
rights of Cancun Air, Dicas and Aeropremier to the assets and liabilities acquired (see Notes 2f,
5, and 6) and are restated using Mexican CPI factors. Amortization expense is computed on the
restated carrying values of the rights to use the airport facilities and the airport concessions.
Restatement of stockholders equity:
The restatement of the Companys capital stock, contributed capital, legal reserve, reserve for the
repurchase of stock and retained earnings is determined by applying Mexican CPI factors from the
dates on which capital was contributed and earnings were generated and reflects the amounts
necessary to maintain the stockholders investment at the purchasing power of the original amounts.
Loss from monetary position:
Loss from monetary position represents the inflationary effect, measured by the Mexican CPI, on the
monetary assets and liabilities.
c) Cash and marketable securities
Cash and marketable securities includes cash, temporary investments and marketable securities. As
of December 31, 2005 and 2006, cash and marketable securities consisted primarily of money market
accounts and short-term Mexican government bonds.
d) Derivatives
Derivatives (including embedded derivatives) are accounted for at fair value at the balance sheet
date in accordance with Bulletin C-10 Derivative Financial Instruments and Hedge Transactions.
F - 10
e) Improvements to concessioned assets, land, machinery, furniture and equipment, net
Depreciation of machinery, furniture and equipment is based upon the restated carrying value of the
assets and is recognized using the straight-line method over the estimated useful lives of the
assets. The useful lives of the Companys machinery, furniture and equipment are as follows:
|
|
|
|
|
Years |
|
|
|
Improvements to concessioned assets |
|
10-50 |
Machinery and equipment |
|
10 |
Office furniture and equipment |
|
10 |
Computer equipment |
|
3 |
Automotive equipment |
|
4 |
Other |
|
various |
When assets are retired or otherwise disposed of, the restated cost and accumulated depreciation
are removed from the accounts and any gain or loss is recorded in results of operations.
f) Rights to use airport facilities, environmental liabilities and airport concessions
Rights to use airport facilities and airport concessions include the acquisition of the nine
airport concessions and the rights acquired from Cancun Air, Dicas and Aeropremier. Although the
Company has, through its concessions, the rights to operate, maintain and develop the nine
airports, all the permanent fixed assets in the airports are owned by the Mexican nation. Upon
termination of the Companys concessions, these assets, including any improvements made during the
term of the concessions automatically revert to the Mexican nation.
The acquisition costs of the nine airports concessions and the acquisition costs of rights acquired
from others entities was allocated to the rights to use the airport facilities and to certain
environmental liabilities assumed with the excess acquisition cost recorded as airport
concessions. The amounts allocated to the rights to use the airport facilities were based on the
depreciated replacement cost of the assets as determined by an independent appraiser. The amounts
allocated to the environmental liabilities assumed were based on managements best estimate of the
actual costs to be incurred and reflect the terms of an agreement with the environmental
authorities, (see Note 5).
The rights to use the airports facilities are being amortized on a straight-line basis over the
estimated remaining useful lives of the underlying assets. The amounts allocated to the airports
concessions are being amortized on a straight-line basis over the life of the concessions and the
rights acquired.
g) Review of the book value of long lived assets
The Company estimates the recoverable value of the rights to use airport facilities, airport
concessions and improvements to concessioned assets to be the estimated discounted future net cash
flows from the nine airport concessions in the aggregate. If the carrying value of the assets
exceeds the recoverable value an impairment loss is recognized. At December 31, 2005 and 2006, the
recoverable value exceeds the net book value.
F - 11
The procedures and criterion used by the Company are in line with the provisions of Bulletin
C-15, Impairment in the Value of Long-lived Assets and Their Disposal, which went into effect on
January 1, 2004.
h) Seniority premiums and employee severance pay
Seniority premiums to which employees are entitled after 15 years of service are recorded as cost
in the years in which the services are rendered, as required by Bulletin D-3, Labor Obligations.
As of 2005, this bulletin requires that a liability be recognized for payments made to employees at
the end of their employment (severance pay), calculated on the basis of the projected unit credit
method. The initial effects were recognized, as permitted by the accounting principle, over the
average working life of the employees and consequently had no effects on the consolidated results
of the period upon adoption. Previously severance pay was recognized in the accounting results of
the year in which amounts were paid.
i) Revenue recognition
Revenues are obtained from aeronautical services, which generally relate to the use of airport
infrastructure by air carriers and passengers, and from non-aeronautical services.
Aeronautical services revenues consist of a passenger charge for each departing passenger
(excluding diplomats, infants, and transfer and transit passengers), a landing charge based on the
average between aircrafts maximum takeoff weight and the zero-fuel weight and hour of arrival,
aircraft parking charges based on the time an aircraft is on the ground and hour of arrival,
passenger walkway charges for the connection of aircraft to the terminal, based on hour of arrival,
and airport security charges for each departing passenger. Aeronautical services revenue is
recognized as passengers depart, at the time of landings and as services are provided, as the case
may be.
Non-aeronautical services revenues consist primarily of the leasing of space in the airport
terminals, access fees received from third parties providing handling, catering and other services
at the airports and miscellaneous other revenues.
Rental income is recognized on terminal space which is leased through operating leases. Such leases
stipulate either: i) fixed monthly rental fees, or ii) fees based on the greater of a minimum
monthly rental fee, a specified percentage of the lessees monthly revenues or the number of
departing passengers. Access fees and other services revenues are recognized as services are
provided. All amounts are calculated and recognized on a monthly basis.
Under the Airport Law and its regulations, the Companys revenues are classified as Airport
Services, Complementary Services or Commercial Services. Airport Services consist primarily of
the use of runways, taxiways and aprons for landings and departures, aircraft parking, the use of
passenger walkways, security services, hangars, automobile parking facilities as well as the
general use of terminal space and other infrastructure by aircraft, passengers and cargo, including
the lease of space essential for the operation of airlines and complementary service providers.
Complementary Services consist primarily of ramp and handling services, catering, maintenance and
repair and related activities
F - 12
that provide support to air carriers. Revenues from access fees charged to third parties providing
complementary services are classified as Airport Services. Commercial Services consist of
services that are not considered essential to the operation of an airport, such as the lease of
space to retailers, restaurants and banks.
The following table presents the Companys revenues for the years ended December 31, 2004, 2005 and
2006, using the classifications established under the Airport Law and its regulations (see below
for discussion of revenue regulation):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended |
|
|
|
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
Regulated services: |
|
|
|
|
|
|
|
|
|
|
|
|
Airport services |
|
Ps. |
1,673,657 |
|
|
Ps. |
1,601,756 |
|
|
Ps. |
1,671,636 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-regulated services: |
|
|
|
|
|
|
|
|
|
|
|
|
Airport services: |
|
|
|
|
|
|
|
|
|
|
|
|
Access fees from non-permanent
ground transportation |
|
|
8,436 |
|
|
|
7,748 |
|
|
|
8,695 |
|
Car parking lots and related access fees |
|
|
27,670 |
|
|
|
34,040 |
|
|
|
37,710 |
|
Other access fees |
|
|
3,375 |
|
|
|
3,179 |
|
|
|
2,362 |
|
Commercial services |
|
|
397,186 |
|
|
|
478,745 |
|
|
|
494,550 |
|
Other services |
|
|
14,267 |
|
|
|
21,992 |
|
|
|
24,008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-regulated services |
|
|
450,934 |
|
|
|
545,704 |
|
|
|
567,325 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ps. |
2,124,591 |
|
|
Ps. |
2,147,460 |
|
|
Ps. |
2,238,961 |
|
|
|
|
|
|
|
|
|
|
|
j) Transactions in foreign currency and exchange rate differences
Monetary assets and liabilities denominated in foreign currencies are translated into Mexican pesos
at the exchange rates in effect as of the balance sheet dates. Currency exchange fluctuations are
included in income for the period and reflected in comprehensive financing cost.
k) Deferred income tax, employees statutory profit sharing and tax on dividends
Deferred income tax
is recorded using the full-liability method of assets and liabilities, which consists of
determining deferred income tax by applying the corresponding tax rate to the differences between
the book and tax values of assets and liabilities at the date of the consolidated financial
statements.
Deferred employees statutory profit sharing is calculated based on nonrecurring temporary
differences between the book profit and the profit subject to employees statutory profit sharing.
F - 13
Deferred income tax and employees statutory profit sharing assets are reduced, if necessary, by
the amount of any tax benefits for which evidence does not indicate that there is a high
probability of future taxable income to realize the assets.
Tax on dividends is recorded against retained earnings pursuant to Bulletin D-4 issued by the MIPA.
Any recovered tax on dividends previously paid is also recorded in retained earnings.
l) Comprehensive income
Comprehensive income is represented by the net income plus items required by specific accounting
standards to be reflected in stockholders equity but which do not constitute capital
contributions, reductions or distributions. It is restated on the basis of Mexican CPI factors.
m) Earnings per share
Basic earnings per share were computed by dividing income available to stockholders by the
weighted-average number of shares outstanding (see Note 8). Weighted-average shares outstanding
for calculating diluted earnings per share reflects the potential dilution that could occur if
dilutive securities and other contracts to issue common stock were exercised or converted into
shares, using the treasury stock method. Under the treasury stock method, proceeds received from
the assumed exercise of the stock options would be used to repurchase the Companys shares at the
average market price during the period.
The weighted average shares outstanding for calculating both basic and diluted earnings per share
was 300 million shares for the years ended December 31, 2004, 2005 and 2006.
n) Concentrations
Trade receivables consist primarily of receivables from major domestic and international airlines.
Approximately 19% and 6% of trade receivables as of December 31, 2005 and 2006, respectively were
receivable from air carriers and other entities controlled by Cintra S.A. de C.V. (Cintra)
including Aeromexico and Aerolitoral. A majority of Cintras capital stock is owned by the
Institute for the Protection of Bank Savings, a decentralized entity within the Mexican federal
public administration, and by the Mexican government. Effective December 20, 2005, Cintra
completed the sale of Mexicana to Grupo Posadas, a Mexican large hotel operator. Mexicana
represented 10% and 9% of 2005 and 2006 revenue.
Further, approximately 77%, 75% and 76% of revenues during the years ended December 31, 2004, 2005
and 2006, respectively, were generated from operations at the Cancún International Airport.
As of December 31, 2006, 2005 and 2004, the Company maintained its cash and marketable securities
with a major Mexican brokerage firm and other Mexican financial institutions. The Company would be
adversely affected in the event of non-performance by any of these institutions. Management does
not anticipate non-performance.
F - 14
o) Recently issued accounting standards
Beginning January 1, 2007, the dispositions of the following Mexican Financial Reporting Standards
(NIF) issued by the Mexican Financial Reporting Standards Board became effective. These
dispositions will not have a significant impact on the financial information.
NIF B-3 Income statement Incorporates a new approach to classify income, costs and expenses as
ordinary and non-ordinary, eliminates special and extraordinary items and establishes employees
profit sharing as an ordinary expense and not as a tax.
NIF B-13 Subsequent events Requires recognition of assets and liabilities restructuring in the
period in which they actually take place and the recognition of
creditors waivers to enforce their
right to demand payment of debts in the event of lack of compliance of the entity with debt
agreement commitments. These issues will be disclosed in the notes to financial statements, if any.
NIF C-13 Related parties Extends the definition (scope) of the related-party concept and
increases the disclosure requirements in the notes to financial statements.
NIF D-6 Capitalization of the Financing Integral Result Establishes the obligation of
capitalization of the financing integral result and the rules for its capitalization.
3. Trade receivables, net
As of December 31, 2005 and 2006, trade receivables, net consist of the following:
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
|
|
|
|
|
|
|
|
|
Trade receivables |
|
Ps. |
179,554 |
|
|
Ps. |
235,830 |
|
Less: allowance for doubtful accounts |
|
|
(10,141 |
) |
|
|
(289 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net |
|
Ps. |
169,413 |
|
|
Ps. |
235,541 |
|
|
|
|
|
|
|
|
The following table presents the roll forward of the allowance for doubtful accounts for the years
ended December 31, 2004, 2005 and 2006:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the beginning of the period |
|
(Ps. |
6,490 |
) |
|
(Ps. |
6,168 |
) |
|
(Ps. |
10,141 |
) |
Increases, applications and
cancellations, net. |
|
|
|
|
|
|
(4,171 |
) |
|
|
9,185 |
|
Effects of inflation |
|
|
322 |
|
|
|
199 |
|
|
|
1,245 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the end of the period |
|
(Ps. |
6,168 |
) |
|
(Ps. |
10,141 |
) |
|
(Ps. |
289 |
) |
|
|
|
|
|
|
|
|
|
|
F - 15
4. Improvements to concessioned assets, land, machinery, furniture and equipment
As of December 31, 2005 and 2006, improvements to concessioned assets, land, machinery, furniture
and equipment, net consists of the following:
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
|
|
|
|
|
|
|
|
|
Machinery and equipment |
|
Ps. |
71,866 |
|
|
Ps. |
82,116 |
|
Office furniture and equipment |
|
|
76,478 |
|
|
|
94,668 |
|
Automotive equipment |
|
|
138,523 |
|
|
|
159,683 |
|
Improvements to concessioned assets (a) |
|
|
1,800,663 |
|
|
|
2,430,202 |
|
Others |
|
|
9,447 |
|
|
|
3,921 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,096,977 |
|
|
|
2,770,590 |
|
Less: accumulated depreciation |
|
|
(384,865 |
) |
|
|
(534,573 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
1,712,112 |
|
|
|
2,236,017 |
|
|
|
|
|
|
|
|
|
|
Land |
|
|
113,532 |
|
|
|
113,532 |
|
Construction in progress (b) |
|
|
227,071 |
|
|
|
723,905 |
|
Advances to contractors |
|
|
213,199 |
|
|
|
75,904 |
|
|
|
|
|
|
|
|
Net |
|
Ps. |
2,265,914 |
|
|
Ps. |
3,149,358 |
|
|
|
|
|
|
|
|
Depreciation expense for the years ended December 31, 2004, 2005 and 2006 was Ps.93,335, Ps.128,217
and Ps.156,458, respectively.
(a) |
|
Improvements to concessioned assets as of December 31, 2005 and 2006, were comprised of the
following: |
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
|
|
|
|
|
|
|
|
|
Buildings |
|
Ps. |
699,652 |
|
|
Ps. |
845,677 |
|
Air side |
|
|
563,882 |
|
|
|
703,227 |
|
Land side |
|
|
180,479 |
|
|
|
189,794 |
|
Technical installations |
|
|
123,426 |
|
|
|
223,323 |
|
Machinery and equipment |
|
|
42,172 |
|
|
|
62,469 |
|
Security equipment |
|
|
40,778 |
|
|
|
220,158 |
|
IT equipment |
|
|
132,920 |
|
|
|
162,743 |
|
Others |
|
|
17,354 |
|
|
|
22,811 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
1,800,663 |
|
|
Ps. |
2,430,202 |
|
|
|
|
|
|
|
|
(b) Construction in progress includes $552,495 related to Terminal 3 building at Cancún Airport
which is expected to start operations by the end of 2007.
5. Airport concessions
F - 16
As stated in Note 1, in June 1998, the Ministry of Communications and Transportation granted to the
Company the concessions to operate, maintain and develop nine airports in the Southeast region of
Mexico for Ps. 12,249,946 (December 31, 2006 constant pesos). The total cost of the airport
concessions, at the acquisition date, were allocated to the rights to use the airport facilities
based on the assets depreciated replacement cost, as determined by an independent appraiser, and
to certain environmental liabilities assumed based on managements best estimate of the actual
costs to be incurred, with the excess acquisition cost allocated to the airport concessions as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining |
|
|
|
|
|
|
estimated |
|
|
|
|
|
|
useful life |
|
|
|
|
|
|
(years) |
|
|
|
|
|
|
|
Acquisition cost |
|
Ps. |
12,249,946 |
|
|
|
|
|
|
|
|
|
allocated to: |
|
|
|
|
|
|
Rights to use airport facilities: |
|
|
|
|
|
|
Runways, taxiways, and aprons |
|
Ps. |
1,525,160 |
|
|
40-42 |
Buildings |
|
|
493,314 |
|
|
17-42 |
Other infrastructure |
|
|
127,282 |
|
|
23 |
Land |
|
|
659,918 |
|
|
42 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,805,674 |
|
|
|
Environmental liabilities |
|
|
(14,966 |
) |
|
|
Airport concessions |
|
|
9,459,238 |
|
|
42 |
|
|
|
|
|
|
|
Total |
|
Ps. |
12,249,946 |
|
|
|
|
|
|
|
|
|
Total amortization expense for the years ended December 31, 2004, 2005 and 2006, was
Ps.264,639.
Each of the Companys airport concessions contain the following basic terms and conditions:
|
|
The concession holder should undertake the construction,
improvement or maintenance of the facilities in accordance
with its Master Development Plan and is required to update the
plan every five years (see Note 14). |
|
|
|
The concession holder may only use the airport facilities
for the purposes specified in the concession and must provide
services in accordance with all applicable law and
regulations, and is subject to statutory oversight by the
Ministry of Communications and Transportation . |
|
|
|
The concession holder must pay a concession fee
(currently 5% of each concession holders gross annual
revenues) from the use of public domain assets pursuant to the
terms of its concessions as required by applicable law. |
|
|
|
Fuel services and supply are to be provided by the
Mexican Airport and Auxiliary Services Agency. |
F - 17
|
|
The concession holder must grant access to and the use of
specific areas of the airport to government agencies to
perform their activities inside the airports. |
|
|
|
The concession may be terminated for non-performance if
the concession holder fails to comply with certain of the
obligations imposed by the concession as established in
Article 27 or for the reasons specified in Article 26 of the
Airport Law. |
|
|
|
The terms and conditions of the regulations governing the
operations of the Company may be modified by the Ministry of
Communications and Transportation. |
6. Other rights acquired
Effective June 30, 1999, the Company acquired the rights of Cancun Air and Dicas to provide certain
services at Cancún International Airport, the rights of Aeropremier to provide certain services at
Mérida International Airport and certain related machinery, furniture and equipment for cash and
promissory notes of approximately US$39.6 million.
The Mexican Airport and Auxiliary Services Agency also granted Dicas the right to construct,
maintain and collect the revenues from the commercial activities and passenger walkway charges
generated by the satellite wing of the main terminal building at the Cancun International Airport
through 2010.
In December 1991, the Mexican Airport and Auxiliary Services Agency granted Aeropremier the right
to construct and operate a general aviation terminal, a first class lounge, a tourism office and
other commercial areas at Merida International Airport through 2010.
Effective with the acquisition of the rights of Cancun Air, Dicas and Aeropremier, the Company
assumed the rights and obligations of Cancun Air, Dicas and Aeropremier under their agreements with
third parties.
The acquisition cost of the rights has been allocated to the rights to use the underlying
facilities based on the assets depreciated replacement cost, as determined by an independent
appraiser, with the excess allocated to airport concessions as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining estimated |
|
|
|
|
|
|
|
useful lives |
|
|
|
2006 |
|
|
(years) |
|
|
|
|
|
|
|
|
|
|
Acquisition cost |
|
Ps. |
535,997 |
|
|
|
|
|
|
|
|
|
|
|
|
|
allocated to: |
|
|
|
|
|
|
|
|
Rights to use: |
|
|
|
|
|
|
|
|
Buildings |
|
Ps. |
57,531 |
|
|
|
20-43 |
|
Other infrastructure |
|
|
2,715 |
|
|
|
5-10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
60,246 |
|
|
|
|
|
Airport concessions |
|
|
475,751 |
|
|
|
0.5-3 |
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
535,997 |
|
|
|
|
|
|
|
|
|
|
|
|
|
F - 18
Amortization of the rights to use the underlying facilities is recorded on a straight-line
basis over the estimated remaining useful lives of the assets. Amortization of amounts allocated
to airport concessions is recorded over the term of the rights acquired. Amortization expense for
the years ended December 31, 2004, 2005 and 2006 was Ps.61,225, Ps.42,950 and Ps.51,373,
respectively.
Through an agreement in March 2004, the Company terminated some lease agreements early at the
Aeropuerto de Cancun, S.A. de C.V., with one of its operators of restaurants and convenience
stores. The price of this transaction amounted to USD7 million dollars, and is being amortized by
using the straight-line method over the remaining lives of the original lease agreements signed by
the parties.
In July 2006, ASUR signed an agreement with a third party by which the Company transferred the
operation of the restaurant and snack bar in the Cancun Airport. The total amount of the
transaction is USD2.55 million, that is been be paid in 9 semi-annual installments with an interest
rate of 15%.
During 2006, the Company invested in various feasibility studies in connection with the bidding for
the concession to construct and operate an alternative airport in southeast area of Riviera Maya.
As of December 31, 2006, the Company has capitalized expenses for USD1 million.
7. Accrued expenses and other payables
As of December 31, 2005 and 2006, this account consists of the following:
|
|
|
|
|
|
|
|
|
|
|
December
31, |
|
|
|
|
2005 |
|
|
2006 |
|
|
Taxes payable |
|
Ps. |
38,839 |
|
|
Ps. |
31,776 |
|
Concession fees |
|
|
26,094 |
|
|
|
26,064 |
|
Due To Shareholder ITA |
|
|
50,815 |
|
|
|
42,710 |
|
Due to Supplier Provetecnia, S.A. de C.V. |
|
|
43,712 |
|
|
|
10,155 |
|
Provision for restoration costs, net |
|
|
48,179 |
|
|
|
17,283 |
|
Other accruals |
|
|
136,691 |
|
|
|
111,109 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
344,330 |
|
|
Ps. |
239,097 |
|
|
|
|
|
|
|
|
8. Stockholders equity
At December 31, 2005 and 2006, the minimum fixed capital with no withdrawal rights is Ps.7,767,276
(nominal figure), represented by 300,000,000 ordinary nominative Class I shares with no par value,
fully subscribed and paid in. The variable portion of the capital stock is represented by ordinary
nominative Class II shares.
As of December 31, 2005 and 2006, capital stock was restated as follows:
F - 19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nominal |
|
|
|
|
|
|
Restated |
|
|
|
value |
|
|
Restatement |
|
|
value |
|
Capital stock: |
|
|
|
|
|
|
|
|
|
|
|
|
Fixed |
|
Ps. |
7,767,276 |
|
|
Ps. |
4,568,231 |
|
|
Ps. |
12,335,507 |
|
|
|
|
|
|
|
|
|
|
|
ASUR and each of its Subsidiaries are legally required to allocate at least 5% of their
unconsolidated annual net income to a legal equity reserve fund. This allocation must be continued
until the equity reserve is equal to 20% of the issued and outstanding capital stock of the
relevant Company. Mexican Corporations may pay dividends only out of earnings after such
allocation to the reserve fund. As of December 31, 2005 and 2006, the Company transferred
Ps.32,632 and Ps.28,992, respectively from retained earnings to legal reserve.
At the April 28, 2005 and April 27, 2006, general stockholders meetings, the Shareholders agreed
to establish a reserve for the repurchase of shares amounting to Ps.353,532 (Ps.328,804 nominal)
and Ps.254,178 (Ps.246,860 nominal), respectively, against retained earnings.
Stock Options
Inversiones y Técnicas Aeroportuarias, S. A. de C. V., did not exercise the options, nor did it
transfer or assign its options to any of its stockholders during the stock option exercise periods
ended December 18, 2003, 2004 and 2005 (see Note 1). As of December 31, 2005 all options were
forfeited.
Dividends
At the April 29, 2004 general stockholders meeting, the Companys stockholders agreed to pay net
dividends after income tax of Ps.190,013 (Ps. 168,000 nominal), or Ps.0.56 (nominal) per share,
thus giving rise to an income tax on dividends of Ps.69,422 (Ps. 61,380 nominal), since they were
not from the After-tax Earnings Account (see note 11).
At the April 28, 2005 general stockholders meeting, the Companys stockholders agreed to pay net
dividends after income tax of Ps.199,989 (Ps.186,000 nominal), or Ps. 0.62 (nominal) per share,
thus giving rise to an income tax on dividends of Ps.85,713 (Ps. 79,714 nominal), since they were
not from the After-tax Earnings Account (see note 11).
At the April 27, 2006 general stockholders meeting, the Companys stockholders agreed to pay net
dividends after income tax of Ps.210,663 (Ps.204,600 nominal), or Ps.0.68 (nominal) per share, thus
giving rise to an income tax on dividends of Ps.86,048 (Ps.83,569 nominal), since they were not
from the After-tax Earnings Account (see note 11).
Dividend will be tax free if paid out of the CUFIN (Net Taxable Income Account). Dividends paid in
excess of the CUFIN balance will be subject to a tax equivalent to 38.89% if paid during fiscal
2007. Tax due will be payable by the Company. It may be credited against Income Tax of the year
or the Income Tax of the two immediately following fiscal years. Dividends paid will not be
subject to any withholding tax.
F - 20
In case of a capital reduction, any excess of stockholders equity over paid-in capital accounts
balances will be given the same tax treatment as a dividend, in accordance with the procedures
provided for in the Income Tax Law.
Substantially all consolidated profits of the Company were generated by its Subsidiaries. Retained
earnings can be distributed to the Stockholders of ASUR to the extent that its Subsidiaries have
distributed profits to ASUR.
Earnings per share
Earnings per share for the years ended December 31, 2004, 2005 and 2006, are presented as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
Income from continuing operations |
|
Ps. |
2.24 |
|
|
Ps. |
1.98 |
|
|
Ps. |
1.81 |
|
Extraordinary items |
|
Ps. |
(0.06 |
) |
|
Ps. |
(0.03 |
) |
|
Ps. |
(0.05 |
) |
|
|
|
|
|
|
|
|
|
|
Net income |
|
Ps. |
2.18 |
|
|
Ps. |
1.95 |
|
|
Ps. |
1.76 |
|
|
|
|
|
|
|
|
|
|
|
9. Rentals under operating leases
The Company leases commercial space inside and outside the terminals to third parties under
operating leases. The following is a schedule by years of minimum future rentals on noncancelable
operating leases as of December 31, 2006 including minimum secured commercial lease agreements per
passenger:
Period ending December 31:
|
|
|
|
|
2007 |
|
Ps. |
388,984 |
|
2008 |
|
|
423,271 |
|
2009 |
|
|
446,448 |
|
2010 |
|
|
418,130 |
|
2011 |
|
|
377,676 |
|
Thereafter |
|
|
2,004,384 |
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
4,058,893 |
|
|
|
|
|
10. Foreign currency balances and transactions
The foreign currency position of monetary items at December 31, 2005 and 2006, were as follows:
F - 21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency |
|
|
Period end |
|
|
|
|
|
|
amounts |
|
|
exchange rate |
|
|
Mexican pesos |
|
|
|
(thousands) |
|
|
|
|
|
|
(thousands) |
|
December 31, 2005 |
|
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and marketable securities |
|
US$ |
20,803 |
|
|
Ps. |
10.6344 |
|
|
Ps. |
221,422 |
|
Prepaids |
|
|
1,043 |
|
|
|
10.6344 |
|
|
|
11,097 |
|
Others |
|
|
2,249 |
|
|
|
10.6344 |
|
|
|
23,913 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Accrued expenses and
other
payables |
|
US$ |
6,984 |
|
|
|
10.6344 |
|
|
|
74,267 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency |
|
|
Period end |
|
|
|
|
|
|
amounts |
|
|
exchange rate |
|
|
Mexican pesos |
|
|
|
(thousands) |
|
|
|
|
|
|
(thousands) |
|
December 31, 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and marketable securities |
|
US$ |
9,441 |
|
|
Ps. |
10.8116 |
|
|
Ps. |
102,074 |
|
Prepaids |
|
|
1,445 |
|
|
|
10.8116 |
|
|
|
15,622 |
|
Deposits |
|
|
41 |
|
|
|
10.8116 |
|
|
|
438 |
|
Clients |
|
|
2,597 |
|
|
|
10.8116 |
|
|
|
28,086 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Accrued expenses and
other
payables |
|
US$ |
3,459 |
|
|
|
10.8116 |
|
|
|
37,393 |
|
Deposits |
|
|
1,018 |
|
|
|
10.8116 |
|
|
|
11,007 |
|
|
|
|
|
|
|
|
|
|
|
The principal foreign currency transactions during the year ended December 31, 2004, 2005 and 2006,
were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency |
|
|
Average |
|
|
|
|
|
|
amounts |
|
|
exchange rate |
|
|
Mexican pesos |
|
|
|
(thousands) |
|
|
|
|
|
|
(thousands) |
|
Year ended December 31, 2004 |
|
|
|
|
|
|
|
|
|
|
|
|
Income statement: |
|
|
|
|
|
|
|
|
|
|
|
|
Technical assistance fees and
related costs |
|
US$ |
2,322 |
|
|
Ps. |
11.59 |
|
|
Ps. |
26,912 |
|
Professional services expenses |
|
|
664 |
|
|
|
11.82 |
|
|
|
7,848 |
|
Other |
|
|
1,199 |
|
|
|
11.65 |
|
|
|
13,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2005 |
|
|
|
|
|
|
|
|
|
|
|
|
Income statement: |
|
|
|
|
|
|
|
|
|
|
|
|
Technical assistance fees and
related costs |
|
US$ |
2,311 |
|
|
Ps. |
10.84 |
|
|
Ps. |
25,048 |
|
Professional services expenses |
|
|
1,916 |
|
|
|
12.58 |
|
|
|
24,111 |
|
Other |
|
|
38 |
|
|
|
11.02 |
|
|
|
419 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
Income statement: |
|
|
|
|
|
|
|
|
|
|
|
|
Technical assistance fees and
related costs |
|
US$ |
2,391 |
|
|
Ps. |
10.98 |
|
|
Ps. |
26,260 |
|
Professional services expenses |
|
|
1,304 |
|
|
|
10.86 |
|
|
|
14,161 |
|
Other |
|
|
876 |
|
|
|
10.90 |
|
|
|
9,548 |
|
|
|
|
|
|
|
|
|
|
|
The prevailing exchange rate between the Mexican peso and the US dollar at December 31, 2005 and
2006 was Ps.10.6344 and Ps.10.8116, per US dollar, respectively. The exchange rate was Ps.10.9920
per US dollar on April 19, 2007.
F - 22
11. Income tax, asset tax and employees statutory profit sharing
The Company does not currently prepare a consolidated tax return.
Under current Mexican Income Tax Law, ASUR and its subsidiaries must pay the higher of the income
tax or the asset tax. The asset tax is a minimum tax, which is calculated as 1.8% of the average
tax value of virtually all of the Companys assets (including the airport concessions), less the
average tax value of certain liabilities (basically liabilities with Mexican residents excluding
those with financial institutions or their intermediaries). The average tax value of each asset or
liability is calculated differently depending on its classification under the tax law. In 2004,
2005 and 2006, the Company incurred Ps.167,993, Ps.141,278 and Ps.121,352, respectively in asset
taxes of which Ps.55,442, Ps. 37,743 and Ps.43,307, respectively were directly charged to income
for the year, since there was no certainty of the recoverability in the future. The asset tax
balance (after adjustments for recoverability) is estimated to be recovered in the following ten
years, when income tax incurred exceeds asset tax in any of those years. The asset tax is restated
by applying factors derived from the NCPI.
In December of 2006, Mexican Tax Authorities approved a change in the calculation of the asset tax
diminishing the tax rate from 1.8% to 1.25% and eliminating the deduction of debts. These changes
will become effective January 1, 2007 and the Company considers that they will not have significant
effects in the consolidated financial statements.
Employees statutory profit sharing in Mexico is determined for each Subsidiary, rather than on a
consolidated basis.
The components of income tax and employees statutory profit sharing expense for the years ended
December 31, 2004, 2005 and 2006, are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years |
|
|
|
ended
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
Income tax-deferred |
|
Ps. |
168,006 |
|
|
Ps. |
234,617 |
|
|
Ps. |
276,970 |
|
Income tax-deferred accounted for
in extraordinary items |
|
|
4,565 |
|
|
|
2,995 |
|
|
|
2,464 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income tax |
|
Ps. |
172,571 |
|
|
Ps. |
237,612 |
|
|
Ps. |
279,434 |
|
|
|
|
|
|
|
|
|
|
|
The following items represent the principal differences between income tax computed at the
statutory tax rate and the Companys provision for income taxes for the years ended December 31,
2004, 2005 and 2006:
F - 23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the |
|
|
years ended |
|
|
December
31, |
|
|
|
2004 |
|
2005 |
|
2006 |
|
Tax at statutory rate |
|
|
(33 |
%) |
|
|
(30 |
%) |
|
|
(29 |
%) |
Non-deductible items and other
permanent differences |
|
|
6 |
% |
|
|
4 |
% |
|
|
(2 |
%) |
Increase in valuation allowance, net |
|
|
(3 |
%) |
|
|
(1 |
%) |
|
|
(1 |
%) |
Change in income tax rate |
|
|
14 |
% |
|
|
1 |
% |
|
|
1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
(16 |
%) |
|
|
(26 |
%) |
|
|
(31 |
%) |
|
|
|
|
|
|
|
|
|
|
|
As a result of the amendments enacted to the Income Tax Law enacted on November 13, 2004, the
Income Tax rate will be 28% in 2007. Accordingly, the effect of these reductions of the Income Tax
rate was considered in the valuation of deferred income tax.
The tax and employees statutory profit sharing effects of temporary differences that give rise to
significant deferred tax and employees statutory profit sharing assets and liabilities at December
31, 2005 and 2006, are as follows:
|
|
|
|
|
|
|
|
|
|
|
December
31, |
|
|
|
2005 |
|
|
2006 |
|
Deferred income tax |
|
|
|
|
|
|
|
|
Deferred tax assets: |
|
|
|
|
|
|
|
|
Tax loss carryforwards |
|
Ps. |
597,661 |
|
|
Ps. |
709,343 |
|
Other |
|
|
50,623 |
|
|
|
31,834 |
|
Valuation allowance |
|
|
(75,262 |
) |
|
|
(84,486 |
) |
|
|
|
|
|
|
|
|
|
|
|
573,022 |
|
|
|
656,691 |
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities: |
|
|
|
|
|
|
|
|
Airport concessions, rights to use
airport facilities and machinery furniture
and equipment |
|
|
(1,734,204 |
) |
|
|
(2,091,146 |
) |
Other |
|
|
(1,312 |
) |
|
|
(5,009 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,735,516 |
) |
|
|
(2,096,155 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred tax liabilities before recoverable asset tax |
|
|
(1,162,494 |
) |
|
|
(1,439,464 |
) |
|
|
|
|
|
|
|
|
|
Recoverable asset tax, net of valuation allowance
of Ps.181,324 and Ps.224,631, respectively |
|
|
495,468 |
|
|
|
573,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred tax liabilities |
|
( |
Ps667,026 |
) | | ( |
Ps865,951 |
) |
|
|
|
|
|
|
|
F - 24
|
|
|
|
|
|
|
|
|
|
|
December
31, |
|
|
|
2005 |
|
2006 |
|
Deferred employees statutory profit sharing: |
|
|
|
|
|
|
|
|
Net deferred employees statutory profit sharing
liabilities recognized in respect of all the non
recurring temporary differences generated in
the year ended December 31, 2000, between the
tax and the book basis |
|
|
(Ps.39,015 |
) |
|
|
(Ps.37,497 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred income tax and employees
statutory profit sharing liabilities |
|
|
(Ps.706,041 |
) |
|
|
(Ps.903,448 |
) |
|
|
|
|
|
|
|
|
|
Based on the weight of available evidence as of December 31, 2005 and 2006, valuation allowances
were recognized for the amount of the net deferred tax assets as of December 31, 2005 and 2006, for
which evidence does not indicate that there is a high probability of future taxable income to
realize the assets.
For tax purposes, the Company is currently amortizing the value of its airport concessions at rates
ranging from 6% to 15%. Tax losses (including those generated from the tax amortization of the
airport concessions) may be carried forward until the expiration of the initial term of the
concessions. As of December 31, 2005 and 2006, the Company had tax loss carryforwards of
approximately Ps.2,134,504 and Ps.2,533,368, respectively.
12. Technical assistance agreement
In connection with the sale of the Series BB shares to Inversiones y Técnicas Aeroportuarias, S.
A. de C. V. (ITA), ASUR entered into a technical assistance agreement with ITA in which ITA and
its Stockholders agreed to provide management and consulting services and transfer industry
expertise and technology to ASUR in exchange for a technical assistance fee. The agreement has an
initial fifteen-year term and is automatically renewed for successive five-year terms,
unless one party provides the other a notice of termination within a specified period prior
to a scheduled expiration date. The Company may only exercise its termination right pursuant to a
Stockholders resolution. ITA, began providing assistance under the agreement on April 19, 1999.
Under the agreement, the Company agreed to pay an annual fee equal to the greater of a fixed fee or
5% of the Companys earnings prior to deducting the technical assistance fee and before
comprehensive financing cost, income taxes and depreciation and amortization, determined in
accordance with Mexican GAAP. For the years 2004, 2005 and 2006 the fixed fee is equal to US$2
million. Each year the fixed fee will be increased by the rate of inflation in the US. ASUR must
also pay the value-added tax on the payment amount.
For the years ended on December 31, 2004, 2005 and 2006, technical assistance expenses were
Ps.71,991, Ps.69,123 and Ps.71,037, respectively.
F - 25
ITA is also entitled to reimbursement for the out-of-pocket expenses it incurs in its provision of
services under the agreement.
ITAs Series BB shares were placed in a trust to, among other things, ensure performance under
the technical assistance agreement.
13. Related party transactions
On March 8, 2005, the Mexican government sold its remaining 11.1% equity interest in ASUR pursuant
to a public offering, and ceased to be related party.
In addition to the revenues earned from Cintra (see Note 2), the Company recorded revenues from
several Mexican federal and state government agencies. Revenues from related parties
excluding Cintra were Ps.1,046 by the period from January to February 2005.
During the period from January to February 2005, the Company recorded expenses of Ps.10,434, for
electricity, waste disposal, water and other services obtained from entities or agencies of the
Mexican federal government.
See notes 2(n), 8 and 12 for disclosures concerning certain other transactions with related
parties.
14. Commitments and contingencies
Commitments:
In 2005, the Company entered into a new 60 month operating lease for its corporate offices with
monthly payments of US$ 17,832.
Rental expense was approximately Ps.3,607, Ps.4,500 and Ps.2,390 for the years ended December
31, 2004, 2005 and 2006, respectively.
On December 30, 2003, the Company received the Ministry of Communications and Transportation
approval for its Master Development Plan (MDP) for each of the nine airports for the period
from 2004 through 2008. Based on the MDPs presented, the Company has agreed to make total
improvements of Ps.3,416,760 from 2004 through 2008, the commitments for the next two years as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Period |
|
Amount (1) |
|
|
|
|
|
|
2007 |
|
Ps. |
1,147,105 |
|
|
|
|
|
2008 |
|
|
160,498 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
Ps. |
1,307,603 |
|
|
|
|
|
|
|
|
|
F - 26
(1) |
|
Expressed in thousands of pesos in purchasing power as of December 31, 2006 applying
Mexican National Construction Price Index factors according with the MDPs terms. |
Contingencies:
a) |
|
The operations of the Company are subject to Mexican federal and state laws and regulations
relating to the protection of the environment. Under these laws, regulations have been issued
concerning water and air pollution, environmental impact studies, noise control and hazardous
wastes. The Ministry of the Environment, Natural Resources and Fishing can bring
administrative, civil and criminal proceedings against companies that violate environmental
laws and has the power to close non-complying facilities. |
|
b) |
|
At present, there are two labor-law claims against the Company. The Company is in the
judicial process. Moreover, no ruling has been handed down at the date of this report. |
|
c) |
|
Claims have been asserted against the Company by the municipalities of Huatulco and Oaxaca or
the payment of property taxes in respect of the land comprising the airports in this
community. Based on the opinion of outside counsel, management believes that there is no
legal basis for these claims and the Company intends to take legal action to have the
claims dismissed. |
Management does not believe that any liabilities relating to these claims are likely to have a
material adverse effect on the Companys consolidated financial condition or results of operations.
15. Segment information
The Company evaluates and assesses its performance on an airport-by-airport basis prior to the
allocation of employee and other costs from Servicios Aeroportuarios del Sureste, S.A. de C.V.
(Servicios), the Companys wholly-owned Subsidiary which employs certain of the Companys
employees. The performance of Servicios is evaluated and assessed separately by management. All
of the airports provide substantially the same services to their customers. Summarized financial
information concerning the Companys reportable segments including Cancún International Airport
(Cancun), Mérida International Airport (Merida), Villahermosa Airport (Villahermosa) and
Servicios is shown in the following table. The financial information of the remaining six airports
and that of the parent holding company (including ASURs investment in its Subsidiaries) have been
aggregated and included as Other. The elimination of ASURs investment in its Subsidiaries is
included in the consolidation adjustments column.
F - 27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidation |
December 31, 2004 |
|
Cancun |
|
Villahermosa |
|
Mérida |
|
Servicios |
|
Other |
|
adjustments |
|
Total |
|
Total revenues |
|
Ps. |
1,623,993 |
|
|
Ps. |
83,174 |
|
|
Ps. |
126,004 |
|
|
Ps. |
190,710 |
|
|
Ps. |
308,389 |
|
|
|
(Ps.207,679 |
) |
|
Ps. |
2,124,591 |
|
Operating
income (loss) |
|
|
856,368 |
|
|
|
21,324 |
|
|
|
15,411 |
|
|
|
10,226 |
|
|
|
204,960 |
|
|
|
(207,679 |
) |
|
|
900,610 |
|
Total assets |
|
|
9,587,364 |
|
|
|
735,766 |
|
|
|
1,078,645 |
|
|
|
35,441 |
|
|
|
16,256,346 |
|
|
|
(13,657,188 |
) |
|
|
14,036,374 |
|
Capital
expenditures |
|
|
281,715 |
|
|
|
28,377 |
|
|
|
19,288 |
|
|
|
1,183 |
|
|
|
112,374 |
|
|
|
|
|
|
|
442,937 |
|
Depreciation and
amortization |
|
|
273,873 |
|
|
|
22,053 |
|
|
|
37,220 |
|
|
|
2,244 |
|
|
|
94,207 |
|
|
|
|
|
|
|
429,597 |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidation |
December 31, 2005 |
|
Cancun |
|
Villahermosa |
|
Mérida |
|
Servicios |
|
Other |
|
adjustments |
|
Total |
|
Total revenues |
|
Ps. |
1,608,863 |
|
|
Ps. |
92,190 |
|
|
Ps. |
137,400 |
|
|
Ps. |
186,613 |
|
|
Ps. |
327,681 |
|
|
|
(Ps.205,287 |
) |
|
Ps. |
2,147,460 |
|
Operating income (loss) |
|
|
780,185 |
|
|
|
26,952 |
|
|
|
19,493 |
|
|
|
(2,496 |
) |
|
|
212,943 |
|
|
|
(205,287 |
) |
|
|
831,790 |
|
Total assets |
|
|
10,128,825 |
|
|
|
765,808 |
|
|
|
1,089,107 |
|
|
|
31,215 |
|
|
|
16,622,392 |
|
|
|
(14,003,897 |
) |
|
|
14,633,450 |
|
Capital expenditures |
|
|
473,757 |
|
|
|
68,207 |
|
|
|
24,638 |
|
|
|
5,098 |
|
|
|
86,130 |
|
|
|
0 |
|
|
|
657,830 |
|
Depreciation and
amortization |
|
|
285,421 |
|
|
|
23,156 |
|
|
|
39,283 |
|
|
|
2,283 |
|
|
|
101,531 |
|
|
|
0 |
|
|
|
451,674 |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidation |
December 31, 2006 |
|
Cancun |
|
Villahermosa |
|
Mérida |
|
Servicios |
|
Other |
|
adjustments |
|
Total |
|
Total revenues |
|
Ps. |
1,693,470 |
|
|
Ps. |
97,008 |
|
|
Ps. |
136,590 |
|
|
Ps. |
189,253 |
|
|
Ps. |
333,165 |
|
|
|
(Ps.210,525 |
) |
|
Ps. |
2,238,961 |
|
Operating income (loss) |
|
|
810,437 |
|
|
|
16,428 |
|
|
|
14,206 |
|
|
|
1,761 |
|
|
|
(13,164 |
) |
|
|
|
|
|
|
829,668 |
|
Total assets |
|
|
10,505,542 |
|
|
|
771,233 |
|
|
|
1,086,658 |
|
|
|
29,998 |
|
|
|
16,814,395 |
|
|
|
(14,266,425 |
) |
|
|
14,941,401 |
|
Capital expenditures |
|
|
922,898 |
|
|
|
30,927 |
|
|
|
41,610 |
|
|
|
1,774 |
|
|
|
91,771 |
|
|
|
|
|
|
|
1,088,980 |
|
Depreciation and
amortization |
|
|
311,947 |
|
|
|
28,009 |
|
|
|
37,613 |
|
|
|
2,329 |
|
|
|
107,890 |
|
|
|
|
|
|
|
487,788 |
|
The accounting policies of the reportable segments are the same as those described in note 2.
F - 28
16. Differences between Mexican Financial Reporting Standards and US GAAP
The Companys consolidated financial statements are prepared in accordance with Mexican Financial
Reporting Standards (Normas de Información Financiera or NIF) , which differ in certain
significant respects from Generally Accepted Accounting Principles in the United States of America
(US GAAP). The NIF consolidated financial statements include the effects of inflation as
provided for under Bulletin B-10 and its amendments (see note 2), whereas consolidated financial
statements prepared in accordance with US GAAP are presented on a historical cost basis. The
reconciliation does not include the reversal of adjustments to the financial statements for the
effects of inflation required under NIF because the application of Bulletin B-10 represents a
comprehensive measure of the effects of price level changes in the inflationary Mexican economy
and, as such, is considered a more meaningful presentation than historical cost-based financial
reporting for both Mexican and US accounting purposes.
The principal differences between NIF and US GAAP and the effect on the Companys net income and
stockholders equity are presented below with an explanation of the adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
Reconciliation of net income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income as reported under
NIF |
|
Ps. |
652,645 |
|
|
Ps. |
586,017 |
|
|
Ps. |
528,115 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
(A) Amortization of airport concessions |
|
|
189,223 |
|
|
|
189,223 |
|
|
|
189,223 |
|
(A) Amortization of rights to use airport facilities |
|
|
17,988 |
|
|
|
16,910 |
|
|
|
15,305 |
|
(B) Terminal 1 building write-off reversal |
|
|
- |
|
|
|
- |
|
|
|
(48,345 |
) |
(C) Contract termination fee on leasehold agreement |
|
|
(73,070 |
) |
|
|
15,869 |
|
|
|
15,318 |
|
(D) Concession fee on lease hold agreement |
|
|
- |
|
|
|
- |
|
|
|
(3,869 |
) |
(E) Tax on dividends, net |
|
|
(41,808 |
) |
|
|
(85,712 |
) |
|
|
(86,048 |
) |
(F) Professional fees for recovered tax on dividends |
|
|
(1,683 |
) |
|
|
- |
|
|
|
- |
|
(G) Deferred employees statutory profit sharing |
|
|
(105,458 |
) |
|
|
(250,844 |
) |
|
|
(148,184 |
) |
(H) Deferred income taxes, net of inflation effects |
|
|
(370,684 |
) |
|
|
(1,202 |
) |
|
|
(45,554 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total US GAAP adjustments |
|
|
(385,492 |
) |
|
|
(115,756 |
) |
|
|
(112,154 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income under US GAAP |
|
Ps. |
267,153 |
|
|
Ps. |
470,261 |
|
|
Ps. |
415,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share |
|
Ps. |
0.89 |
|
|
Ps. |
1.57 |
|
|
Ps. |
1.39 |
|
|
|
|
|
|
|
|
|
|
|
F - 29
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Reconciliation of stockholders equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity reported under
NIF |
|
Ps. |
13,553,697 |
|
|
Ps. |
13,785,101 |
|
|
|
|
|
|
|
|
|
|
US GAAP adjustments: |
|
|
|
|
|
|
|
|
(A) Airport concessions |
|
|
(8,103,583 |
) |
|
|
(7,914,360 |
) |
(A) Rights to use airport facilities |
|
|
(477,135 |
) |
|
|
(461,830 |
) |
(B) Terminal 1 write-off reversal |
|
|
|
|
|
|
(48,345 |
) |
(C) Contract termination fee on leasehold agreement |
|
|
(57,201 |
) |
|
|
(41,883 |
) |
(D) Concession fee on lease hold agreement |
|
|
|
|
|
|
(3,869 |
) |
(G) Deferred employees statutory profit
sharing |
|
|
281,096 |
|
|
|
132,912 |
|
(H) Deferred income taxes |
|
|
2,315,346 |
|
|
|
2,269,792 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total US GAAP adjustments |
|
|
(6,041,477 |
) |
|
|
(6,067,583 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity under US GAAP |
|
Ps. |
7,512,220 |
|
|
Ps. |
7,717,518 |
|
|
|
|
|
|
|
|
A summary of the Companys statement of changes in stockholders equity with balances determined under US GAAP are as follows:
|
|
|
|
|
Balance at December 31, 2004 |
|
Ps. |
7,241,948 |
|
Net income |
|
|
470,261 |
|
Dividends declared |
|
|
(199,989 |
) |
|
|
|
|
|
|
|
|
|
Balance at December 31, 2005 |
|
|
7,512,220 |
|
Net income |
|
|
415,961 |
|
Dividends declared |
|
|
(210,663 |
) |
|
|
|
|
|
|
|
|
|
Balance at December 31, 2006 |
|
Ps. |
7,717,518 |
|
|
|
|
|
The following tables present the condensed consolidated balance sheets and statements of income of
the Company, including all US GAAP adjustments, as of December 31, 2005 and 2006, and for the years
ended December 31, 2004, 2005 and 2006.
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
Ps. |
1,117,236 |
|
|
Ps. |
828,706 |
|
Other current assets |
|
|
816,701 |
|
|
|
811,984 |
|
Net current deferred tax asset |
|
|
45,718 |
|
|
|
23,860 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
1,979,655 |
|
|
|
1,664,550 |
|
|
|
|
|
|
|
|
F - 30
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Improvements to concessioned assets, land,
machinery, furniture and equipment net |
|
|
2,264,172 |
|
|
|
3,149,358 |
|
Airport concessions net |
|
|
89,448 |
|
|
|
29,796 |
|
Rights to use airport facilities net |
|
|
1,706,238 |
|
|
|
1,655,139 |
|
Deferred employees statutory profit
sharing |
|
|
243,599 |
|
|
|
95,415 |
|
Deferred income taxes |
|
|
1,602,602 |
|
|
|
1,379,981 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
Ps. |
7,885,714 |
|
|
Ps. |
7,974,239 |
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders Equity |
|
|
|
|
|
|
|
|
Seniority premiums |
|
Ps. |
6,548 |
|
|
Ps. |
7,511 |
|
Other current liabilities |
|
|
366,946 |
|
|
|
249,210 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
373,494 |
|
|
|
256,721 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
7,512,220 |
|
|
|
7,717,518 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
Ps. |
7,885,714 |
|
|
Ps. |
7,974,239 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years ended |
|
|
|
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
Net revenues |
|
Ps. |
2,124,591 |
|
|
Ps. |
2,147,460 |
|
|
Ps. |
2,235,092 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of services (1) |
|
|
(609,569 |
) |
|
|
(808,960 |
) |
|
|
(784,554 |
) |
General and administrative
expenses (1) |
|
|
(219,160 |
) |
|
|
(129,384 |
) |
|
|
(102,293 |
) |
Depreciation and amortization |
|
|
(212,034 |
) |
|
|
(229,673 |
) |
|
|
(267,743 |
) |
Other expenses |
|
|
(179,864 |
) |
|
|
(189,581 |
) |
|
|
(249,505 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
(1,220,627 |
) |
|
|
(1,357,598 |
) |
|
|
(1,404,095 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
903,964 |
|
|
|
789,862 |
|
|
|
830,997 |
|
|
|
|
|
|
|
|
|
|
|
|
Net comprehensive financing income (cost) |
|
|
(34,928 |
) |
|
|
22,820 |
|
|
|
15,214 |
|
Income tax expense (2) |
|
|
(601,883 |
) |
|
|
(342,421 |
) |
|
|
(430,250 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
Ps. |
267,153 |
|
|
Ps. |
470,261 |
|
|
Ps. |
415,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Exclusive of depreciation and amortization. |
|
(2) |
|
Consists of assets tax, tax on dividends and income taxes. |
F - 31
(A) Airport concessions, rights to use airport facilities and environmental liabilities
Under NIF, the acquisition costs of the nine airport concessions were allocated to the rights to
use the airport facilities and to the environmental liabilities assumed, with the remainder
allocated to airport concessions. The amount allocated to the rights to use the airport facilities
was based on the results of an independent appraisal. The fair values of the environmental
liabilities assumed are based on managements best estimate of the actual costs to be incurred and
reflect the terms of a new agreement with the environmental Authorities.
The rights to use the airport facilities, environmental liabilities and the airport concessions
were transferred between entities under common control. Under US GAAP, the rights to use the
airport facilities and the environmental liabilities were recorded equal to their
historical book value at November 1, 1998 (Ps.1,935,314 and Ps.25,235, respectively) and no value
was assigned to the airport concessions from the predecessor.
(B) Terminal 1 building write-off reversal
As described in Note 1 in July 2006, the Company was instructed by the Mexican government to repair
the Terminal 1 building and under NIF, the Company reversed a portion of the 2005 write-off related
to certain assets of Terminal 1 which were once again to be placed in service.
Under US GAAP, reversal of losses is not permitted, therefore, the amount reversed and its related
depreciation recognized in NIF was adjusted under US GAAP. That is, under US GAAP the carrying
value of these Terminal 1 assets pre-July 2007 decision is zero.
(C) Contract termination fee on leasehold agreements
Under NIF, the Company capitalized a one-time termination fee on a concessionaires leases at the
Cancun airport, which is being amortized over the remaining lives of the original lease agreements
(see Note 6). Under US GAAP, pursuant to SFAS 146 Accounting for Costs Associated with Exit or
Disposal Activities this fee represents a contract termination cost that should be expensed when
the Company terminates the leases. Therefore, charges of Ps.15,869 and Ps.15,318 in the US GAAP
reconciliation in 2005 and 2006, respectively, reflect the reversal of amortization expense
recorded under NIF.
(D) Concession fee on Leasehold agreement
During 2006, the Company entered into an agreement to transfer the operation of the Restaurant and
Snack Bar in Cancun Airport to a third party for an USD 2.55 million fee of which USD 638.89
Thousand were collected in December 2006, and the remainder will be paid in 8 semi-annual
installments with an interest rate of 15%.
Under NIF the Company recognized the fee as income as it becomes receivable according to the
provision of the agreement.
F - 32
Under US GAAP, pursuant to SFAS No. 13 Accounting For Leases this agreement is accounted for as
an operation lease; therefore income is recognized on a straight line basis over the term of the
agreement.
(E) Tax on dividends
Under NIF, tax on dividends is recorded as a reduction of retained earnings. For the years ended
December 31, 2004, 2005 and 2006, the Company paid tax on dividends amounting to Ps.69,422 , Ps.
85,712 and Ps. 86,048, respectively. Under US GAAP, tax on dividends is recorded within a tax
expense since in accordance with Mexican Tax Law it can be used to reduce future taxable income in
the year incurred and the following two years. Such tax on dividends is subject to a valuation
allowance. During the year ended December 31, 2004, 2005 and 2006, the Company recovered Ps.
25,931, Ps. 0 and Ps. 0 (net of Ps. 1,683, Ps. 0 and Ps. 0 of related professional fees),
respectively, which under NIF was recorded as a credit to retained earnings. Under US GAAP, the
recovered tax on dividends was recorded as an income tax benefit in the income statement.
(F) Professional fees for recovered tax on dividends
Under NIF, the Company recorded professional fees incurred in 2004 in connection with the recovery
of the tax on dividends against retained earnings. Under US GAAP, these professional fees are not
payments made to the tax authorities and, accordingly, they are not classified in the income
statement as income tax expenses, but rather as other expenses.
(G) Employees Statutory Profit Sharing
Under NIF, Bulletin D-4 requires the recognition of employees statutory profit sharing for all
nonrecurring temporary differences generated during the period.
Under US GAAP, employees statutory profit sharing is recognized in accordance with the
requirements of SFAS 109. Under this method, employees statutory profit sharing is recognized in
respect of all temporary differences utilizing a full liability method. In addition, under US
GAAP, the benefit or expense recognized during the period is recorded in pretax earnings.
Through December 31, 2004, the Company calculates profit sharing liabilities as 10% of its net
taxable income. In calculating the net taxable income for profit sharing purposes, the Company
deducts net operating loss, or NOL, carryforwards. The application of NOL carryforwards can result
in a deferred profit sharing asset for a given period instead of a profit sharing liability.
On May 3, 2005, the Mexican Supreme Court ruled in a plenary session relating to four cases that
NOL carryforwards could not be deducted when calculating net taxable income for profit sharing
liability purposes. In light of these decisions, the Companys management decided not to include
the NOL carryforwards in the calculation of its profit sharing liability.
The components of employees statutory profit sharing expense, prepared after considering the
impact of US GAAP adjustments, for the years ended December 31, 2004, 2005 and 2006 are as follows:
F - 33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years ended |
|
|
|
December 31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
|
Deferred |
|
Ps. |
105,458 |
|
|
Ps. |
250,844 |
|
|
Ps. |
148,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ps. |
105,458 |
|
|
Ps. |
250,844 |
|
|
Ps. |
148,184 |
|
|
|
|
|
|
|
|
|
|
|
The effects of temporary differences that give rise to significant deferred employees statutory
profit sharing assets, prepared after considering the impact of US GAAP adjustments, at December
31, 2005 and 2006 are as follows:
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Deferred assets: |
|
|
|
|
|
|
|
|
Airport concessions, rights to use
airport facilities and machinery, furniture
and equipment |
|
Ps. |
237,621 |
|
|
Ps. |
94,363 |
|
Tax loss carryforwards |
|
|
|
|
|
|
|
|
Other |
|
|
23,234 |
|
|
|
15,325 |
|
Valuation allowance |
|
|
(16,788 |
) |
|
|
(12,484 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
244,067 |
|
|
|
97,204 |
|
Deferred liabilities |
|
|
(468 |
) |
|
|
(1,789 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred employees statutory profit sharing asset |
|
Ps. |
243,599 |
|
|
Ps. |
95,415 |
|
|
|
|
|
|
|
|
(H) Deferred income taxes
Accounting for income taxes in accordance with Bulletin D-4 is similar to accounting for income
taxes in accordance with US GAAP, SFAS No. 109 (SFAS 109), Accounting for Income Taxes.
Bulletin D-4 requires that the change in net deferred income taxes during the period resulting from
inflation on monetary deferred tax assets and liabilities be recorded against the gain or loss on
monetary position. For US GAAP purposes, the Company applied the guidance in EITF 93-9,
Application of FASB Statement No. 109 in Foreign Financial Statements Restated for General
Price-Level Changes and consequently, the deferred tax expense is calculated comparing beginning
and ending deferred tax balances on a constant currency basis (i.e. December 31, 2006 constant
pesos). The monetary gain related to deferred income taxes for the years ended December 31, 2004,
2005 and 2006 amounted to Ps.4,062, Ps. 849 and Ps.1,870, respectively which have been reflected in
the deferred tax line item for US GAAP purposes.
The deferred tax adjustments required to reconcile stockholders equity and net income under
Mexican GAAP to US GAAP as of and for the years ended December 31, 2004, 2005 and 2006, result from
the differences in accounting for the airport concessions, the rights to use airport facilities,
the contract termination fee on leasehold agreements and the difference in presenting the effects
of inflation.
F - 34
The tax effects of temporary differences that give rise to significant deferred tax assets and
liabilities, prepared after considering the impact of US GAAP adjustments, at December 31, 2005 and
2006 are as follows:
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Current deferred tax asset: |
|
|
|
|
|
|
|
|
Accrued liabilities |
|
Ps. |
45,596 |
|
|
Ps. |
23,123 |
|
Prepaids and other current assets |
|
|
2,803 |
|
|
|
6,714 |
|
|
|
|
|
|
|
|
|
|
|
48,399 |
|
|
|
29,837 |
|
|
|
|
|
|
|
|
|
|
Less: current valuation allowance |
|
|
(2,681 |
) |
|
|
(2,806 |
) |
|
|
|
|
|
|
|
Current deferred tax asset |
|
|
45,718 |
|
|
|
27,031 |
|
|
|
|
|
|
|
|
|
|
Current deferred tax liability: |
|
|
|
|
|
|
|
|
Inventories |
|
|
|
|
|
|
(3,171 |
) |
|
|
|
|
|
|
|
Current deferred tax liability |
|
|
|
|
|
|
(3171 |
) |
|
|
|
|
|
|
|
|
|
Net current deferred tax asset |
|
Ps. |
45,718 |
|
|
Ps. |
23,860 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncurrent deferred tax asset: |
|
|
|
|
|
|
|
|
Contract termination fee on leasehold
agreement |
|
Ps. |
18,479 |
|
|
Ps. |
14,798 |
|
Tax paid on dividends |
|
|
86,048 |
|
|
|
85,712 |
|
Tax loss carryforwards |
|
|
597,662 |
|
|
|
709,343 |
|
Fixed assets |
|
|
665,355 |
|
|
|
264,217 |
|
Seniority premiums |
|
|
1,485 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,369,029 |
|
|
|
1,074,070 |
|
|
|
|
|
|
|
|
|
|
Less: noncurrent valuation allowance |
|
|
(260,642 |
) |
|
|
(265,832 |
) |
|
|
|
|
|
|
|
|
Noncurrent deferred tax asset |
|
|
1,108,387 |
|
|
|
808,238 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncurrent deferred tax liability: |
|
|
|
|
|
|
|
|
Other deferred assets |
|
|
(1,253 |
) |
|
|
(1,770 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non current deferred tax liability |
|
|
(1,253 |
) |
|
|
(1,770 |
) |
|
|
|
|
|
|
|
Net noncurrent deferred tax liability |
|
|
1,107,134 |
|
|
|
806,468 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net deferred tax asset |
|
|
1,152,852 |
|
|
|
830,328 |
|
Recoverable asset tax |
|
|
495,468 |
|
|
|
573,513 |
|
|
|
|
|
|
|
|
Total deferred tax asset |
|
|
1,648,320 |
|
|
|
1,403,841 |
|
F - 35
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
2005 |
|
|
2006 |
|
Net deferred tax asset under U.S. GAAP |
|
|
1,648,320 |
|
|
|
1,403,841 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred tax liability under Mexican
Reporting Standards |
|
|
667,026 |
|
|
|
865,951 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred U.S. GAAP adjustments to the
net deferred tax asset |
|
Ps. |
2,315,346 |
|
|
Ps. |
2,269,792 |
|
|
|
|
|
|
|
|
Based on cumulative tax losses in recent years, valuation allowances were recognized as of December
31, 2005 and 2006, for the amount of the net deferred tax assets (including net operating loss
carryforwards) and asset tax credit carryforwards for the airports of Huatulco, Minatitlan, Cozumel
and Tapachula and for Servicios Aeroportuarios del Sureste S.A. de C.V. and Grupo Aeroportuario del
Sureste, S.A. de C.V.
(I) Cash and marketable securities
Under NIF, temporary investments and marketable securities, expected to be held less than one year,
are considered to be cash equivalents.
Under US GAAP, temporary investments and marketable securities with original maturities greater
than 90 days are considered to be short-term investments and, accordingly, are shown separately
from cash in the balance sheet and cash flow statement.
(J) Restructure, contract termination fees and loss on natural disaster
Under NIF, restructure costs, certain contract termination fees and loss on natural disaster were
charged against the results of operations as an extraordinary item. Under US GAAP, restructure
costs, contract termination fees and loss from natural disaster would be considered an operating
expense. These charges have been reclassified as an operating expense in the US GAAP condensed
consolidated income statement.
(K) Supplemental Cash Flow Information
NIF Bulletin B-12, Statements of Changes in Financial
Position (Bulletin B-12), specifies the appropriate presentation of the statement of changes in
financial position. Under Bulletin B-12, the sources and uses of resources are determined based
upon differences between
beginning and ending consolidated financial statement balances in constant pesos. Under US GAAP, a
statement of cash flows is required, which presents only cash movements and excludes non-cash
items.
Presented below are statements of cash flows of the Company for the years ended December 31, 2004,
2005 and 2006, prepared after considering the impact of US GAAP adjustments. The cash flow
F - 36
statements present nominal cash flows during the periods, adjusted to December 31, 2006, purchasing
power.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the years ended |
|
|
|
December
31, |
|
|
|
|
2004 |
|
|
2005 |
|
|
2006 |
|
Operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income under US GAAP |
|
Ps. |
267,153 |
|
|
Ps. |
470,261 |
|
|
Ps. |
415,961 |
|
Adjustments to reconcile net income to
cash flows provided by operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Loss from monetary position |
|
|
72,253 |
|
|
|
66,234 |
|
|
|
88,322 |
|
Asset tax, tax on dividends and deferred
income taxes |
|
|
601,882 |
|
|
|
342,421 |
|
|
|
430,250 |
|
Deferred employees statutory profit sharing |
|
|
105,451 |
|
|
|
250,844 |
|
|
|
148,184 |
|
Depreciation and amortization |
|
|
212,034 |
|
|
|
229,673 |
|
|
|
267,743 |
|
Other provisions |
|
|
|
|
|
|
196,306 |
|
|
|
59,993 |
|
Write off of fixed assets |
|
|
|
|
|
|
57,184 |
|
|
|
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Trade receivables |
|
|
(44,952 |
) |
|
|
69,459 |
|
|
|
(72,727 |
) |
Recoverable taxes and other current assets |
|
|
(193,331 |
) |
|
|
(140,883 |
) |
|
|
(162,013 |
) |
Trade accounts payable |
|
|
869 |
|
|
|
11,389 |
|
|
|
(15,701 |
) |
Accrued expenses and other payables |
|
|
40,598 |
|
|
|
(213,825 |
) |
|
|
(190,188 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows provided by operating activities |
|
|
1,061,957 |
|
|
|
1,339,063 |
|
|
|
969,824 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Short-term investments |
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of short term investments |
|
|
(629,628 |
) |
|
|
(401,788 |
) |
|
|
(341,283 |
) |
Proceeds from short term investments |
|
|
718,699 |
|
|
|
125,145 |
|
|
|
388,180 |
|
Purchase of other rights and machinery
furniture and equipment |
|
|
(442,937 |
) |
|
|
(620,332 |
) |
|
|
(996,763 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows provided by (used in) investing
activities |
|
|
(353,868 |
) |
|
|
(896,976 |
) |
|
|
(949,866 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance proceeds |
|
|
|
|
|
|
(115,496 |
) |
|
|
(54,304 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment of dividends |
|
|
(190,013 |
) |
|
|
(199,989 |
) |
|
|
(210,663 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows used in financing activities |
|
|
(190,013 |
) |
|
|
(199,989 |
) |
|
|
(210,663 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effects of inflation on cash and cash equivalents |
|
|
15,245 |
|
|
|
(33,015 |
) |
|
|
(43,521 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Decrease in cash and cash equivalents |
|
|
533,321 |
|
|
|
93,587 |
|
|
|
(288,530 |
) |
Cash and cash equivalents at beginning of period |
|
|
490,328 |
|
|
|
1,023,649 |
|
|
|
1,117,236 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
Ps. |
1,023,649 |
|
|
Ps. |
1,117,236 |
|
|
Ps. |
828,706 |
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash disclosures: |
|
|
|
|
|
|
|
|
|
|
|
|
Asset tax and tax paid on dividends |
|
Ps. |
238,785 |
|
|
Ps. |
226,990 |
|
|
Ps. |
211,668 |
|
|
|
|
|
|
|
|
|
|
|
Supplemental non-cash disclosures: |
|
|
|
|
|
|
|
|
|
|
|
|
Recovered tax on dividends |
|
Ps. |
27,622 |
|
|
Ps. |
0 |
|
|
Ps. |
0 |
|
|
|
|
|
|
|
|
|
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F - 37
(L) Recently Issued Accounting Standards
In June 2006, the FASB issued FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty in
Income Taxes an interpretation of FASB Statement No. 109. FIN 48 clarifies the accounting for
uncertainty in income taxes by prescribing thresholds and attributes for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a tax return. The
interpretation also provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, and disclosure. FIN 48 is effective for fiscal years beginning after
December 15, 2006. The Company is currently evaluating the impact of adopting FIN 48.
In June 2006, the EITF ratified the consensus on EITF Issue No. 06-3 (EITF 06-03), How Taxes
Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income
Statement (That Is, Gross versus Net Presentation). EITF 06-03 concluded that the presentation of
taxes assessed by a governmental authority that is directly imposed on a revenue-producing
transaction between a seller and a customer, such as sales, use, value-added and certain excise
taxes is an accounting policy decision that should be disclosed in a companys financial
statements. In addition, companies that record such taxes on a gross basis should disclose the
amounts of those taxes in interim and annual financial statements for each period for which an
income statement is presented if those amounts are significant. EITF 06-03 is effective for interim
and annual reporting periods beginning after December 15, 2006. The Company does not anticipate
that the adoption of EITF 06-03 will have an impact on its financial condition or results of
operations.
In September 2006, the FASB issued SFAS No. 157 (SFAS 157), Fair Value Measurements. This statement
defines fair value, establishes a framework for measuring fair value in GAAP and expands
disclosures about fair value measurements. SFAS 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007. The Company is currently evaluating the impact
of adopting SFAS 157 on its financial condition and results of operations.
The sixteen notes are part of these consolidated financial statements, which were authorized for
its emission dated April 18, 2007, by the executive that signed completely these consolidated
financial statements and its notes.
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C.P.A. Adolfo Castro Rivas
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Chief Financial and Strategic Planning Officer |
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Grupo Aeroportuario del Sureste, S.A.B. de C.V. |
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F - 38
EXHIBIT INDEX
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Exhibit No. |
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Description |
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1.1
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An English translation of the Amended and Restated Bylaws (Estatutos Sociales) of
the Company. |
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2.1
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Deposit Agreement among the Company, The Bank of New York and all registered
holders from time to time of any American Depositary Receipts, including the form
of American Depositary Receipt (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
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3.1
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Trust Agreement among the Company, ITA and Bancomext, together with an English
translation (incorporated by reference to our registration statement on Form F-1
(File No. 333-12486) filed on September 7, 2000). |
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3.2 |
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Amendment dated May 15, 2007 to the Trust Agreement dated November 18, 1998 among the
Company, ITA and Bancomext, English translation. |
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4.1
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Amended and Restated Cancun Airport Concession Agreement and annexes thereto,
together with an English translation and a schedule highlighting the differences
between this concession and the Companys other concessions (incorporated by
reference to our registration statement on Form F-1 (File No. 333-12486) filed on
September 7, 2000). |
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4.2
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Participation Agreement among the Company, the Mexican Federal Government through
the Ministry of Communications and Transportation, Nacional Financiera, S.N.C.
(NAFIN), Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de
Cancun, S.A. de C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco,
S.A. de C.V., Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A.
de C.V., Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de
C.V., Aeropuerto de Veracruz, S.A. de C.V., Aeropuerto de Villahermosa, S.A. de
C.V., Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports,
Cintra Concesiones de Infraestructuras de Transporte, S.A., Groupe GTM, S.A.,
Inversiones y Tecnicas Aeroportuarias, S.A. de C.V. (ITA), Banco Nacional de
Comercio Exterior, S.N.C. (Bancomext) and Aeropuertos y Servicios Auxiliares
(ASA), together with an English translation (incorporated by reference to our
registration statement on Form F-1 (File No. 333-12486) filed on September 7,
2000). |
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4.3
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First Amendment to the Participation Agreement, the Shareholders Agreement and the
Technical Assistance Agreement among the Mexican Federal Government through the
Ministry of Communications and Transportation, NAFIN, Bancomext, the Company,
Servicios Aeroportuario del Sureste, S.A. de C.V., Aeropuerto de Cancun, S.A. de
C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de C.V.,
Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V.,
Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V.,
Aeropuerto de Veracruz, S.A. de C.V. and Aeropuerto de Villahermosa, S.A. de C.V.;
ITA, Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports,
Cintra Concesiones de Infraestructura de Transporte, S.A. de C.V. and Groupe GTM,
S.A. (incorporated by reference to our registration statement on Form F-1 (File
No. 333-12486) filed on September 7, 2000). |
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4.4 |
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Second Amendment dated April 30, 2007 to the Participation Agreement dated December 18, 1998
among the Company, the Mexican Federal Government through the Ministry of Communications and
Transportation, NAFIN, Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de
Cancun, S.A. de C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de
C.V., Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V., Aeropuerto
de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V., Aeropuerto de Veracruz, S.A.
de C.V., Aeropuerto de Villahermosa, S.A. de C.V., Triturados Basalticos y Derivados, S.A. de
C.V., Copenhagen Airports, Cintra Concesiones de Infraestructuras de Transporte, S.A., Groupe
GTM, S.A., ITA, Bancomext, ASA and Fernando Chico Pardo, English translation. |
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4.5 |
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Technical Assistance and Transfer of Technology Agreement among the Company,
Servicios Aeroportuarios del Sureste, S.A. de C.V., Aeropuerto de Cancun, S.A. de
C.V., Aeropuerto de Cozumel, S.A. de C.V., Aeropuerto de Huatulco, S.A. de C.V.,
Aeropuerto de Merida, S.A. de C.V., Aeropuerto de Minatitlan, S.A. de C.V.,
Aeropuerto de Oaxaca, S.A. de C.V., Aeropuerto de Tapachula, S.A. de C.V.,
Aeropuerto de Veracruz, S.A. de C.V., Aeropuerto de Villahermosa, S.A. de C.V.,
Triturados Basalticos y Derivados, S.A. de C.V., Copenhagen Airports, Cintra
Concesiones de Infraestructuras de Transporte, S.A., VINCI, S.A. and ITA, together
with an English translation (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
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8.1
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List of subsidiaries of the Company (incorporated by reference to our registration
statement on Form F-1 (File No. 333-12486) filed on September 7, 2000). |
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11.1
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Code of Ethics (incorporated by reference to our Form 20-F filed on June 16, 2004). |
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12.1
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Certification of Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. |
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12.2
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Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002. |
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13.1
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Certifications of Chief Financial Officer and Chief Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002. |