Although Solid Top Line Performance, Margins Contracted

• The Mexican transport sector posted another quarterly result with solid top-line performance. However, a better tariff environment and diversified revenues were not enough to compensate for margin contractions.
• GAP reported the most robust results, with double-digit revenues and EBITDA expansion, followed by OMA and ASUR. The total EBITDA margin in the transport sector contracted 0.1 pp, with the airport sector being the segment with the highest reduction in margins (-1.7 pp YoY). Total sales in the transport sector advanced 10.1% in 1Q25, while EBITDA gained 9.8% YoY. We highlight that TRAXION posted an attractive 1.2 pp expansion in its EBITDA margin, while VOLAR posted the weakest results, with revenues and EBITDAR contractions of 12% and 14%, respectively.
• We reiterate our positive outlook in the transport sector, remaining ASUR and TRAXION as our top-pick names. These names offer attractive potential upside for long-term investors at attractive valuation levels. In VOLAR, we reduce our PT after incorporating 1Q25 figures in our model. On the other hand, we also reiterate our Mkt Perform ratings for GAP, OMA, and GMXT.

1Q25 in a nutshell. Total revenues in the sector gained 10% YoY, which is mostly in line with our estimates. On the other hand, total EBITDA was up 10% YoY, a lower path compared to the top line performance, reflecting higher costs, mainly labor, and those related to ramping up new operations, mainly in the non-aeronautical front in airports. Please note that the airport companies continue posting attractive growth rates among our transport coverage, being GAP, the company which delivered the highest growth rate (+26% YoY), mainly explained by the company’s tariffs implemented in 2025. In contrast, ASUR and OMA posted more moderate growth rates, supported by the non-aeronautical revenue row, which was also positively impacted by PAX expansions. In addition, total EBITDA gained 9.8%, noting that TRAXION posted the most robust result. In contrast, ASUR, GAP, OMA, GMXT, and VOLAR posted EBITDA margin contractions.

We maintain a positive outlook with selected names to participate. Although a challenging environment, total PAX has proven to be resilient, as demonstrated during the last decades, having a traffic recovery from previous local or global crises. Our current estimates consider that total air PAX within our coverage may increase 6% YoY, resulting in a gradual recovery after a 1% contraction reported in 2024. We updated our 12M price targets for airports and Volar while reiterating our PT for TRAXION and GMXT.