Corporacion America Airports (NYSE:CAAP) reported second-quarter adjusted EBITDA excluding IFRIC 12 of $160 million, down 4.5% from a year earlier, as pressure in Argentina’s cargo business, reduced domestic airline capacity in Argentina and non-recurring expenses in Uruguay offset growth across much of its airport portfolio.
Chief Executive Officer Martín Eurnekian said four of the company’s six operating segments delivered double-digit EBITDA growth during the quarter. He also said international passenger demand remained healthy across most markets, while revenue growth exceeded passenger-volume growth.
Traffic Stable as International Growth Offsets Domestic Weakness
Approximately 21 million passengers traveled through the company’s airports in the second quarter, leaving total traffic broadly stable year over year. International traffic increased nearly 6%, while domestic traffic fell about 8%, primarily because of lower seat capacity in Argentina.
Excluding Argentina, total passenger traffic increased across all of the company’s markets, according to Eurnekian.
- Argentina: Total traffic declined about 6%. International traffic rose 4%, supported by increased capacity in April and May, but domestic traffic fell nearly 12% amid reduced airline capacity. Eurnekian cited Flybondi’s smaller operating fleet and higher fuel prices as major factors. July domestic traffic was down 10%, while international traffic increased 5%.
- Italy: Traffic increased just over 5%, led by a 6.4% rise in international passengers. Pisa and Florence both contributed to the increase.
- Brazil: Traffic rose roughly 4%, as a 14% increase in transit passengers more than offset a modest decline in domestic traffic. Brasilia continued to benefit from its role as a connecting hub. July traffic grew 8%.
- Uruguay: Passenger traffic increased 2%, despite the timing shift of the Easter holidays. The company cited added connectivity, including Azul’s Montevideo-Belo Horizonte service. July traffic rose 3%.
- Armenia: Traffic climbed 13%, the strongest increase in the portfolio, despite flight cancellations and regional airspace restrictions tied to Middle East conflict. July traffic rose 17%.
- Ecuador: Traffic increased about 2%, with international passenger traffic up more than 8%. New service from Avianca, JetBlue and LATAM, as well as added American Airlines frequencies, supported international demand. July traffic declined 1% as domestic weakness outweighed international growth.
Chief Financial Officer Jorge Arruda said Argentina’s domestic traffic weakness was principally an airline-capacity issue rather than a demand issue. He said Flybondi plans to expand its fleet from 16 to 19 aircraft in coming months, while Aerolíneas Argentinas and JetSmart recorded their second-best domestic months in Argentina during July.
“Over the short to medium term, we are positive,” Arruda said of Argentina’s domestic market.
Revenue Growth Outpaces Passenger Volumes
Total revenue excluding IFRIC 12 increased 8% year over year, outpacing traffic. Consolidated revenue per passenger rose nearly 9% to $22.90 from $21.00 in the prior-year period, reflecting stronger commercial performance throughout the portfolio, including Argentina.
Aeronautical revenue increased 4%, with growth in Brazil, Italy, Armenia, Uruguay and Ecuador more than offsetting a decline in Argentina. Tariff increases in Brazil, Uruguay and Ecuador also supported results.
Commercial revenue grew 13%, led by fuel-related revenue in Armenia and increased revenue from VIP lounges, space rentals, food and beverage and duty-free operations. Argentina was the exception, where lower cargo, parking and duty-free revenue outweighed gains in other commercial categories.
Arruda said commercial revenue would have increased 26% excluding Argentina cargo, which faced a difficult comparison with the prior year. Customs labor disruptions in Argentina in the second quarter of 2025 extended cargo storage periods and generated unusually high storage revenue. This year, normalized customs operations and faster clearance processes reduced dwell times and storage revenue.
Costs, EBITDA and Balance Sheet
Total costs and expenses excluding IFRIC 12 rose 16%, driven by higher fuel costs in Armenia, non-recurring expenses in Uruguay and the appreciation of local currencies in Argentina and Uruguay against the U.S. dollar. Excluding the fuel business, costs and expenses increased 9%.
Adjusted EBITDA declined 21% in Argentina, where lower domestic passenger traffic and the difficult cargo comparison affected profitability. Uruguay’s adjusted EBITDA declined 16%, mainly due to costs related to a new instrument landing system, or ILS, before associated revenue began in August, as well as other non-recurring expenses.
Other markets posted double-digit EBITDA growth. Italy’s adjusted EBITDA rose 19%, or 11% excluding construction services at Toscana Aeroporti. Brasilia Airport’s EBITDA increased 32%, Armenia’s rose 21%, and Ecuador’s increased 17%.
The company ended the quarter with total liquidity of $861 million, up 20% from $715 million at the end of 2025. Total debt stood at $1.1 billion, while net debt declined to $381 million from $502 million at year-end. Net leverage was 0.5 times.
Dividend, Concession Work and Second-Half Outlook
The board approved $150 million of cash dividends payable this year, equivalent to about $0.91 per share. Eurnekian said the decision reflects the company’s objective of improving shareholder returns while maintaining financial strength, adequate operating-company cash balances and flexibility for growth opportunities.
The company said it continues to advance a concession rebalancing process in Argentina and efforts to obtain final approval for the Florence Airport Master Plan. Arruda said the Toscana Aeroporti process is moving forward and that the company expects Italian authorities to issue a statement declaring the project strategic before a subsequent service conference process.
For the second half, management expects new routes, additional frequencies and inbound demand to support international traffic in Argentina. However, limited domestic airline capacity, planned runway maintenance and another challenging cargo comparison may affect near-term Argentine results. Arruda said runway maintenance at Aeroparque and Ezeiza is not expected to have a major impact on consolidated results.
In Uruguay, the new ILS began generating revenue in August. The company also expects a new VIP lounge, an expanded duty-free area, cargo initiatives and healthy traffic trends to support revenue growth.
Corporación América Airports is also evaluating concession opportunities across the Americas, Africa and the Middle East. Arruda identified Hurghada Airport in Egypt as a public tender where the company has been publicly named as a shortlisted bidder alongside a local partner.
About Corporacion America Airports (NYSE:CAAP)
Corporación América Airports SA operates as a global airport infrastructure and services company, specializing in the development, acquisition and management of airport concessions. Headquartered in Buenos Aires, Argentina, the firm oversees long-term agreements that cover the planning, design, financing and ongoing operation of airport facilities. Its integrated approach aims to enhance operational efficiency and passenger experience through modernized terminals and streamlined processes.
The company’s core activities encompass passenger handling, cargo operations and ancillary services such as retail concessions, food and beverage outlets, ground handling, fueling and airport parking.
