Airports, the BMV sector with the highest growth in 3Q22

The companies in the Price and Quotation Index (IPC) of the Mexican Stock Exchange (BMV) that grew the most in their operating flow (EBITDA) in the third quarter of 2022 were the airport operators (Asur, GAP and OMA), while In profits, the largest increase was seen in the financial sector (Banco del Bajío, Banorte, Bolsa, Gentera, Inbursa, Regional, and Quálitas).

Aeropuertos del Sureste (Asur) had a year-on-year increase of 39.6% in its EBITDA (totaling 4,607 million pesos), while Grupo Aeroportuario del Centro Norte (OMA) grew its operating flow 45.9% (to 1,908 million pesos) and Grupo Aeroportuario del Pacífico raised it 31.8%, for a total of 4,085 million pesos.

In net profit, they also had a significant increase: Asur increased it 41.9% compared to 2021, to 2,547 million pesos; OMA expanded it 35.7%, to 1,098 million pesos, while GAP raised it 31.9%, to 2,598 million pesos.

Jacobo Rodríguez, director of research at Black Wallstreet Capital, commented that airports continue to benefit from the recovery in passenger traffic as restrictions due to the Covid-19 pandemic are relaxed.

Regarding the financial sector, the BW Capital analyst highlighted that it was resilient in the July-September period, in addition to benefiting from increases in interest rates.

Banorte’s net income grew 30.1%, while that of the rest of the financial companies also presented an important year-on-year increase: Banco del Bajío (68.7%), Bolsa (69.1%), Gentera (130.4%), Inbursa (%), Regional (50.1%). Only Inbursa had a fall in its utility, of 8.2 percent.

In contrast, the sectors that had the worst performance in the third quarter were those that were most affected by the increase in costs due to inflation: Mining (Grupo México and Peñoles), Airlines (Volaris) and Cement companies (Cemex).

Grupo México and Peñoles suffered a drop of 29.7 and 61.7%, respectively, in their net income, due to an increase in costs, as well as a difficult base of comparison in the prices of industrial metals.

For its part, Volaris’ net profit fell 48.6% compared to 2021 due to higher fuel costs, while Cemex’s EBITDA fell 12.4% in the July-September 2022 period.

CPI EBITDA cae 0.1%

The companies in the IPC presented on average a slight drop of 0.1% year-over-year in their operating cash flow (EBITDA) during the third quarter of 2022, pressured by high inflation and higher costs. Overall sales grew 7.3%, while net income exceeded analysts’ expectations.

The sectors that had the highest growth were finance and airports, while mining and other companies in the industrial and transportation sectors stood out for their poor results in the third quarter of 2022, pressured by higher costs.

Of the firms that make up the main stock market index in Mexico, eight reported an EBITDA better than the consensus estimate, while four posted worse figures than those forecast by analysts, according to a Monex report. The remaining 16 had results in line with expectations. Only Operadora de Sites Mexicanos remains to report its results.

Regarding EBITDA, only 28 companies from the trade, industrial and services sectors are considered, excluding those from the financial sector, since they do not report operating cash flow.

“The drop in EBITDA is explained by high inflation, which generates an increase in costs for companies and that puts pressure on their profit margins,” said Carlos González, director of analysis at Monex Casa de Bolsa.

The analyst commented that inflationary pressures were in the third quarter (and have been throughout the year) the main drag on the financial results of companies on the Stock Exchange.

“Inflation was a primary element in this reporting season, since not all the issuers were able to pass on the rise in prices to the final consumer, which affected practically all of their margins. Only those that were able to make an adequate transfer of prices and have coverage in inputs for production, were able to register expansions in results”, assured Alain Jaimes, stock market analyst at Signum Research.

Valentín Mendoza, associate director of stock market research at Actinver Casa de Bolsa, commented that 75% of the 35 companies that make up the IPC sample exceeded estimates in terms of profits, while 50% had sales higher than forecast.

The Actinver analyst assured that in sales, “we expected a growth (on average) of 3.5% and the increase ended up being 7.3%”, while “the utility came ‘flat’ with an increase of 0.1%, and we expected a drop of 12.0%”. Mendoza commented that the drop in EBITDA was in line with what the consensus estimated.

“The results of the companies in general terms were positive, with growth in sales and profits greater than expected,” said Jacobo Rodríguez.

The better-than-expected reporting season was the main catalyst that boosted the IPC of the Mexican Stock Exchange in the last two weeks, explained Valentín Mendoza.

The IPC has rebounded 10.05% since the start of the quarterly reporting season, reaching 50,864.85 on Tuesday, its highest level since early June. The companies whose shares have risen the most in this period are: Kimberly Clark de México (17.74%), Peñoles (17.23%), Operadora de Sites Mexicanos (16.59%), América Móvil (15.57%) and Cuervo (14.50%).

sebastian.diaz@eleconomista.mx