Grupo Aeroportuario del Pacífico Signals Resilient Growth

Grupo Aeroportuario Del Pacifico ((PAC)) has held its Q4 earnings call. Read on for the main highlights of the call.

Grupo Aeroportuario del Pacífico’s latest earnings call painted a broadly upbeat picture, with management highlighting strong revenue expansion, resilient margins over the full year, and ample liquidity to fund an ambitious investment cycle. While short‑term pressure from a hurricane in Jamaica, higher costs, and financial headwinds weighed on Q4, the tone remained constructive given solid fundamentals and clear 2026 guidance.

Strong Revenue Growth Across Quarter and Full Year

Q4 combined aeronautical and related service revenues climbed 12.8% year over year, with core aeronautical income up 12.6% and new aeronautical streams rising 13.3% quarter on quarter. For the full year 2025, aeronautical revenue advanced 19.4%, underscoring sustained demand and pricing power across the airport portfolio despite uneven traffic trends.

Non-Aeronautical Engines Power Commercial Upside

Non‑aeronautical revenue was another standout, jumping 26.5% year over year in 2025 as the company extracted more value per passenger. Revenue per passenger from these activities rose to MXN 152 from MXN 123, a nearly 24% increase driven by better commercial execution and stronger contributions from food and beverage, retail, ground transportation, leasing, and cargo and warehouse services.

EBITDA Growth and Resilient Full-Year Margins

Profitability remained robust despite a weaker fourth quarter, with Q4 EBITDA up 7.5% to MXN 5.1 billion and full‑year 2025 EBITDA rising 17.8% to MXN 21.3 billion. Excluding IFRIC 12, the annual EBITDA margin held at a strong 65.6%, signaling that the core business is still highly profitable even as the group absorbs higher fees and operational transitions.

Solid Liquidity and Strengthened Capital Structure

GAP closed the year with MXN 10.5 billion in cash and cash equivalents, giving it a comfortable liquidity cushion as it moves through its investment plan. Management also reinforced the balance sheet by issuing bond certificates and reducing pressure from bank loans, preserving flexibility to navigate volatility and pursue growth initiatives without overleveraging.

CapEx Execution and Long-Term Infrastructure Plan

The first year of the 2025–2029 Master Development Program saw MXN 12.4 billion deployed, including significant spending in Jamaican airports and commercial projects. These investments aim to expand terminal capacity and enhance the passenger experience in Mexico and the Caribbean, positioning the network to capture future traffic growth once temporary disruptions fade.

Strategic CBX Transaction Set to Unlock Efficiencies

Shareholders approved the combination of the Cross Border Xpress operation with its existing terminal assistance framework, and the company is now moving to formalize the deal. Management expects to consolidate CBX in the second quarter of 2026, with visible efficiency gains by the fourth quarter and full synergy realization by mid‑2027, enhancing the cross‑border platform’s long‑term value.

Positive 2026 Guidance Supported by Core Strength

For 2026, GAP is guiding passenger traffic growth of 2%–5%, with aeronautical revenues projected to rise 9%–12% and non‑aeronautical revenues 6%–9%. Total revenues are expected to grow 8%–11%, while EBITDA is seen increasing 8%–11% with margins hovering around 65%, reflecting confidence in the underlying business despite ongoing external risks and recent disruptions.

Mexico Traffic and Commercial Momentum Remain Healthy

In Mexico, passenger traffic grew about 2.7% in 2025 and 2.9% in Q4, demonstrating steady demand in the company’s largest market. Commercial revenues were especially strong thanks to cargo and bonded warehouse operations and the renegotiation of key contracts, which helped lift the performance of commercial spaces across the network.

Jamaica’s Recovery Path After Hurricane Melissa

Hurricane Melissa created a sharp near‑term setback, but management reports that hotel and tourist infrastructure on the island is recovering faster than initially feared. Authorities now see hotel capacity returning to full strength by the winter 2026 season, and GAP expects Jamaica’s passenger decline to narrow to between minus 2% and 0% by year‑end as tourist flows gradually normalize.

Q4 Passenger Decline Driven by Diverging Markets

Overall passenger traffic slipped 0.9% year over year in the fourth quarter of 2025, masking the split between stable to growing volumes in Mexico and a steep drop in Jamaica. The divergence highlights how localized shocks can temporarily overshadow broader portfolio strength, but also underscores the importance of geographic diversification in smoothing the group’s longer‑term trajectory.

Severe Hurricane Impact on Jamaican Operations

The impact of Hurricane Melissa, which struck on October 28, was particularly severe for Jamaican airports, where traffic fell around 35% during the quarter. Montego Bay and Kingston saw sharp declines in November and December, and management still expects weakness through the spring season before a more meaningful recovery is likely during the winter travel period.

Margin Pressure and Rising Costs in the Fourth Quarter

Fourth‑quarter profitability came under pressure, with the EBITDA margin excluding IFRIC 12 dropping to 53.8% as costs moved higher. The compression was driven by increased concession fees in Mexico, a larger workforce, higher maintenance expenses linked to internalizing jet bridge and Airbus‑related services, and the negative operating leverage from reduced traffic in Jamaica.

Net Income Hit by Financial and Tax Headwinds

Despite strong operating trends, net income declined year over year, reflecting a less favorable financial backdrop rather than operational weakness. Higher interest expense, reduced interest income due to a lower average cash balance, FX movements, lower market rates, and a deferred tax provision adjustment all combined to weigh on the bottom line during the period.

Security Events in Jalisco Cause Short-Term Disruption

Beyond weather, security incidents in the Mexican state of Jalisco around February 22 triggered significant operational disruption at Guadalajara and Puerto Vallarta airports. Around 171 flights were canceled in Guadalajara and 134 in Puerto Vallarta over the initial days, affecting roughly 50,000 passengers, although management noted that operations have since normalized.

Lost Expansion Options and Project Setbacks

The company also acknowledged missed or delayed international opportunities after the government canceled the Parks & Cope standard process, effectively removing a potential growth avenue. Separately, the process related to Turks and Caicos is now viewed as effectively over, signaling that not all external expansion projects will come to fruition despite GAP’s interest in broader regional growth.

Broader Exposure to External and Macro Risks

Management reiterated that the business remains exposed to currency volatility, natural disasters such as hurricanes, and overall global uncertainty, which can temporarily pressure results. However, the company emphasized that its diversified portfolio and disciplined capital allocation are designed to mitigate these shocks over time and preserve long‑term value creation for investors.

Forward-Looking Guidance and Key Assumptions

Looking ahead to 2026, GAP’s guidance calls for 2%–5% passenger growth, revenue expansion in the high single to low double digits, and EBITDA up 8%–11% with margins near 65%, assuming stable execution and no major shocks. The company said tariff‑increase targets are largely on track, noted that its forecast excludes the CBX consolidation, and highlighted foreign exchange, inflation, and natural events as the main risks to its outlook.

GAP’s earnings call balanced strong underlying growth with a candid assessment of near‑term challenges, ultimately skewing positive for long‑term investors. Robust revenue and EBITDA gains, healthy liquidity, and a clear capex and CBX integration roadmap offset temporary hits from Jamaica, higher costs, and financial headwinds, leaving the company positioned as a resilient play on regional air travel demand.