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Aeroports de Paris SA (AEOXF) Q4 2022 Earnings Call Transcript

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Aeroports de Paris SA (OTCPK:AEOXF) Q4 2022 Results Conference Call February 16, 2023 4:00 AM ET

Company Participants

Cecile Combeau - Head, IR

Augustin de Romanet - Chairman and CEO

Edward Arkwright - Deputy CEO

Philippe Pascal - CFO

Conference Call Participants

Cristian Nedelcu - UBS

Stephanie D’Ath - RBC

Elodie Rall - JPMorgan

Nicolas Mora - Stanley

Ruxandra Haradau-Doser - Kepler Cheuvreux

José Manuel Arroyas - Santander

Graham Hunt - Jefferies

Dario Maglione - BNP Paribas

Cecile Combeau

Thank you, and bully morning, everyone. I'm Cecile Combeau, Head of Investor Relations of Groupe ADP and it is my pleasance to invited you to our afloat twelvemonth results convention call. I'm present pinch our Chairman and CEO, Augustin de Romanet; Deputy CEO, Edward Arkwright; and CFO, Philippe Pascal.

After nan position of our afloat twelvemonth results by nan management, we will unfastened nan statement to Q&A. But earlier we start, I would for illustration to tie your attraction to nan meaning of nan financial indicators that we will mention to during nan presentation. They are connected Page 42 of nan presentation, and please return a look astatine our accustomed disclaimer related to forward-looking statements, which is connected Page 44. And pinch that, fto maine manus it complete to nan Chairman and CEO, Augustin de Romanet.

Augustin de Romanet

Thank you, Cecile. Good morning, everybody. We are happy to beryllium pinch you, and acknowledgment to beryllium pinch us. It's a pleasance to beryllium pinch you, and arsenic you astir apt saw successful nan headlines, we are posting coagulated results for 2022, gathering aliases exceeding astir of nan time, each nan targets we person group for nan year.

Revenue, which is €4.7 billion, up 69% year-on-year 2021. The 2 main drivers for this capacity are: first, nan vigorous betterment successful traffic, some successful Paris and internationally; and secondly, nan beardown momentum of nan retail and services businesses successful Paris. EBITDA stands astatine €1.7 billion. This is simply a separator of 36.4% of revenues, successful statement pinch nan nonsubjective to beryllium successful nan precocious portion of nan targeted range. Net income is backmost to affirmative territory, opinionated astatine €116 million. And nan ratio betwixt our nett financial indebtedness and EBITDA importantly improved successful 2022. It is opinionated astatine 4.5x EBITDA. We person exceeded our target here. Excluding nan proceeds from nan waste of our liking successful Royal Schipol Group, this ratio stands astatine 4.6x EBITDA compared to a target of 5 to 5.5x EBITDA. This beardown capacity leads america to propose a dividend of €3.13 per stock for nan support of nan adjacent AGM. That is comfortably supra nan target travel we had group successful February 2022, which was €1.

Next descent shows that coming marks nan first day of nan motorboat of our strategical roadworthy map, 2025 Pioneers. And I must opportunity that I'm very pleased pinch its successful launch. As you will spot successful nan highlights, I'm astir to present, we person initiated a bid of actions contributing to build nan instauration of a caller airdrome exemplary by 2025. Moving to Slide 5, focusing connected our operations successful Paris. We welcomed astir 87 cardinal passengers successful Paris, which is much than nan double compared to 2021, up 106% versus past year. The 2nd half of nan twelvemonth was peculiarly strong, reaching 88% of 2019 traffic. This beardown betterment has been an operational quality challenge, and I return this opportunity to convey our labor and partners for their mobilization and engagement.

As you know, compared to different hubs successful Europe, our capacity has been excellent. We've been capable to negociate this surge successful postulation without immoderate capacity restriction. You cognize that value of work is very, very important for maine and that leads maine to this taxable of hospitality, which, arsenic you know, our halfway attraction to america astatine nan halfway of our, that we telephone resolvement. [Ph] You tin spot connected nan chart connected nan near that rider restitution remained conscionable supra 2019 levels. For sure, we had immoderate difficulties, notably pinch constabulary and controls for passports. But each day, we strive to build a hospitality exemplary aimed astatine excellence. The progressive move to this strategy shows promising signs of success.

You tin spot that nan spending per departing rider successful our airside areas successful Paris, this is what we telephone Extime Paris income per pax has reached an all-time level of €27.4 and it is awesome moreover arsenic we person 7x little Chinese travelers than before. Nevertheless, we had a very bully performance. Especially successful nan 4th quarter, which has been outstanding. The seasonality of nan business partially explains this grounds level. Nevertheless, nan wide trends make america assured for nan early of our unit and work businesses.

2023 marks nan general motorboat of our airdrome hospitality and unit caller marque called Extime. I'm now connected Slide 7. Last April, you remember, we opened Terminal 2G successful CDG aft it sewage nan marque makeover. This was nan inaugural preamble of nan Extime marque nether nan Lifestyle pharma and unit offering. Beginning of December, we reopened a wonderfully upgraded terminal 1 successful CDG, our first boutique terminal and really, I think, a flagship. It is nan first of our premium format executive and judge me, it is stunning. It will beryllium soon beryllium followed by CDG Terminal 2BD connection, building to beryllium branded Extime nether nan manner format to beryllium completed later this period and orders to travel done 2023.

About our world portfolio. To item immoderate of nan successful achievements successful our world portfolio, I would for illustration to mention, first, Antalya Airport, nan renewal of Ankara Airport concession until 2050, and regarding GMR Airports; Indonesia Capital City Airport, Medan has been taken complete since July. The caller Goa airdrome successful India has conscionable commissioned past autumn by Prime Minister Modi. And third, nan disposal of Cebu Airport successful Philippines was completed past December arsenic portion of nan plus rotation and deleveraging target of GMR. Our world assets thief having a well-balanced portfolio successful position of vulnerability to promising geographies wherever demographic and economical patterns show important maturation potential, and I'm pleased pinch nan team's achievements successful 2022.

About societal work and governance, we person been very active. I'm now connected Slide 9. As a responsible employer, Groupe ADP is promoting individual civic engagement of its labor successful 2022, this materialized into much than 800 cumulative days benefiting to section nonprofit organizations. Regarding governance, you will retrieve that ADP group up a stakeholder committee contributing to nan alignment of its ESG targets and our financial objectives. In a tone of transparency, nan stakeholder committee precocious published a first achromatic insubstantial connected nan waste of crushed entree and strategies for reducing CO2 emissions connected nan ground. And moreover if I was not 100% successful accordance pinch this paper, we person decided to people it connected my LinkedIn relationship showing that I purpose to stock each nan opinions, moreover immoderate decent which could provokes.

Now Slide 10. Speaking astir contented of emissions, which is 1 of our priorities, you spot connected Slide 10, immoderate illustration of nan improvement introduced successful our building useful projects. Groupe ADP wants to beryllium nan leader and is committed to trim its c footprint by building little and better. The task highlighted successful this descent illustrates our progresses pinch caller building modes and nan usage of materials connected machinery pinch little c emissions. Groupe ADP positions itself arsenic an progressive subordinate successful nan airdrome transition. Sixteen airports of nan group engaged successful nan airdrome c legalization program, 10 of them gained a level past year. I'm very proud we obtained nan level 4 airdrome c legalization certification for our 3 French platforms arsenic good arsenic successful Amman successful Jordan past July. Atlas level moreover received Level 4, which is nan past measurement earlier reaching Net Zero soul emissions. Now let's get into our capacity much successful item pinch Philippe Pascal.

Philippe Pascal

Thank you, Augustin, and bully morning, everyone. Let's move connected to Slide 13 pinch traffic. All our airports knowledgeable a beardown betterment of traffic, postulation betterment against 2019 stood astatine 80.2% successful Paris. As mentioned by Augustin, postulation much than doubled compared to nan past twelvemonth successful Paris, a immense return of passengers. At nan group level, nan betterment remains conscionable somewhat higher than we ended up successful 80.9% of 2019 profit. This betterment levels autumn successful statement pinch our assumptions, which, arsenic you remember, were paid successful July and announced past October.

Moving to Slide 14 to attraction connected Paris Aeroport. We spot that postulation pinch Europe, which magnitude to 45% of postulation has recovered good to 82.8% of 2019 postulation levels successful 2022 and 91.7% successful Q4. This betterment continues to beryllium peculiarly beardown for low-cost traffic, representing 27.6% of postulation successful Paris compared to astir 22% earlier COVID. International traffic, which, arsenic you know, is nan astir contributive some for regulated and nonregulated revenues stood astatine 76.3% of 2019. Traffic pinch Asia remains nan weakest pinch only 34% of 2019 level, but we saw an acceleration successful nan 2nd half pinch 45% betterment compared to only 22% betterment successful nan first portion of 2022. China reopened only very precocious and was still astatine only 6% of 2019 successful Q4.

Now if we look astatine really this postulation construe into our unit business successful Paris, we spot that capacity has been contemptibly beardown this year. Sales per pax outperformed our first expectations, reaching nan grounds level of €27.4 successful 2022, positive €2.1 supra 2021, and positive €4 supra 2019 sales-per pax. Within that performance, we are seeing immoderate pass-through of ostentation connected income price, but pinch an wide humble impact. Above all, these numbers show nan relevance of Group ADP's unit connection and airdrome hospitality model, which meets nan request of passenger. One of nan astir evident motion connected this is simply a beardown maturation successful luxury merchandise spending. The reopening of Terminal 1 has been an important milestone for our caller unit concept, Extime, and we spot that nan 2023 numbers will corroborate this very bully and beardown performance.

Moving connected to Slide 15 for our 2 main world assets. As remember, word numbers are afloat consolidated successful our accounts and GMR Airport consequence connected equity accounting. On nan near side, nonrecovery stands astatine 81.2% of 2019 level. Touristic airports successful usage are recovering well, notably Antalya, pinch 87.5%, acknowledgment to nan postulation pinch nan U.K. and Germany, which was good supra 2019 level. Some world assets successful Georgia, Macedonia and astir importantly, Almaty show beardown performance. Almaty is surpassing 2019 practical. On nan correct side, we tin spot GMR Airports opinionated astatine 81.2% recovery. It is stronger successful Indian airdrome driven by home profit, which stood astatine 19.9% of 2019 level. Note that Cebu Airport and Indonesia was disposed arsenic portion of nan plus rotation and delivering strategy of GMR.

Now getting backmost to our financial capacity successful 2022. All cardinal financial indicators powerfully improved successful volume, but besides separator and demands. I propose to move straight to Slide 17 for much specifications connected our gross first. Revenue reached €4.7 billion, up 68.8% versus past year. Within this growth, €229 cardinal and linked to nan afloat twelvemonth effect of nan integration of Almaty Airport acquired successful May 2021 and its gross increased. In Paris, nan Aviation conception is up 63%, driven by postulation recovery. The Retail & Services conception is not 75% versus 2021, helped by nan beardown income per pax summation to traffic. Revenue for existent property was up positive 6.8%, acknowledgment to much gains owed to nan caller improvement and nan return to afloat ownership of immoderate buildings successful 2021. Outside Almaty, airdrome capacity has been strong. International gross almost double compared to 2021, totaling €1.4 billion.

Moving connected to Slide 18, pinch EBITDA opinionated astatine €1.7 billion, up to €953 cardinal compared to past year. The beardown betterment is driven by nan betterment of postulation impacted positively, successful peculiar our revenue. At nan aforesaid time, our costs guidelines benefited from a comparative protection against inflation. The stock of power expenses successful our OpEx remained unchangeable successful 2022. As you remember, we secured our power purchases pinch hedged prices until December 2023. Energy costs are expected to summation from 2024. Consumable and outer services costs accrued slower than traffic, positive 49% versus 2021.

We still had a fewer notes closed astatine nan opening of nan year, which helped a bit. But this bully power besides reflects nan truth that a ample proportionality of our contracts see fixed value aliases are not straight indexed pinch inflation. Nevertheless, I punctual you that astir 10% of our contracts are indexed pinch ostentation and 15% of them will beryllium renewing during 2023. As a result, we expect outer services costs to move somewhat up successful 2023.

Regarding unit costs, 2022 benefited from nan effect of nan departure plan, and those departures occurred chiefly astatine nan early opening of nan year. At nan aforesaid time, we person started to enlistee again to travel nan return of postulation positive 550 group accreted successful 2022, minus almost 100 group pinch earthy attrition. The effect of nan recruitment successful 2022 stay humble because recruitment were made progressively. It will beryllium felt much successful 2023. We implemented salaries accrued from EDP exemplary institution successful nan 2nd half of 2022 for €10 cardinal arsenic good arsenic immoderate onetime profit sharing prize paid successful November and to salary successful 2023 for an further €9 million. These 2 effects were offset by provisional reversal. All successful all, excluding Amatil, unit expenses were up 16.6%, chiefly owed to net summation and recruitment of TAV Airports and successful our returners.

So EBITDA separator is up 9.4 points to 36.4% successful nan precocious portion of nan 32% to 37% target arsenic announced successful October. Below EBITDA, Slide 19, you tin spot amortization and impairment are mostly unchangeable while profit from associates and JVs is up €75 million, chiefly owed to higher capacity successful TAV Airport Services Company. This leads to an betterment successful our operating income to €936 million. Financial consequence is down €6 million, benefiting from a lesser costs of indebtedness and €46 cardinal summation from disposal stake. I punctual that past twelvemonth benefited from nan affirmative effect of Tunisia indebtedness resurfacing for much than €100 million. Income taxation accrued sharply to €172 million, reflecting our return to profitability. Groupe ADP recorded its first profitable twelvemonth since 2019 pinch a nett income of €518 million, starring to propose a dividend of €3.1.

Last connection connected nett debt, Slide 20. Net indebtedness is down €571 cardinal compared to December 2021. Cash travel from operations has been strong, supra €1.5 billion, driven by nan EBITDA growth, including nan proceeds from RSG process liking disposal for €420 million. Net indebtedness ratio is improving radically down to 4.4x EBITDA. Excluding this impact, it is 4.6x EBITDA outperforming our target of 5 to 5.5x nan EBITDA. And pinch that, I will manus backmost to Augustin. Thank you.

Augustin de Romanet

Thank you very much, Philippe. To adjacent this presentation, I would for illustration to springiness you a fewer comments connected our outlook, starting pinch our priorities successful 2023 connected Slide 22. This year, we will proceed to beryllium afloat focused connected our 2025 Pioneers strategical roadworthy map, contributing to nan ecological modulation of our sector. We, arsenic an airdrome arsenic astatine nan overgrind of this ecological transition. This is simply a paramount nonsubjective and it is astatine nan bosom of our activity and capacity guidance readying successful Paris this year.

2023 will besides beryllium nan last twelvemonth to hole for nan Olympics. We'll beryllium getting fresh to invited delegations of athletes who person each circumstantial needs. It will beryllium a awesome opportunity to present immoderate innovations successful our rider journey, benefiting for nan early of our infrastructures. Olympics aliases not, we will invited passengers successful our airports. We went into effort to amended our services connected hospitality, notably pinch nan deployment of time, our caller unit specialty brand. And last, we will proceed to fortify nan integration of our world airdrome network. As you tin see, we proceed to person a batch of connected our plate. This business programme is done successful a discourse wherever nan betterment successful postulation continues.

About traffic, immoderate postulation outlook. We are getting a much precise position connected our postulation expectations for 2023. Our cardinal assumptions are unchanged, but we person narrowed our expected ranges. In Paris, postulation should guidelines this twelvemonth betwixt 87% to 93% of nan 2019 traffic. Going forward, we proceed to spot a return to 2019 level sometime betwixt '24 and '26. At group level, postulation this twelvemonth should get person to return to 2019 levels, and we expect 95% to 105%. So nary alteration to our position of a return to 2019 level sometime betwixt 2023 and 2024. Now, based connected these assumptions and considering nan capacity delivered successful 2022 arsenic good arsenic nan effect that Philippe Pascal described regarding our costs guidelines and nan beardown maturation expected successful our world activities.

Let's look astatine our updated financial trajectory into 2025. First, EBITDA. EBITDA is expected to proceed to grow, and it should beryllium adjacent aliases supra that of 2019, already successful 2023. This is 1 twelvemonth earlier than what we initially hoped for. So we corroborate our guidance of an EBITDA separator betwixt 32% and 37% of gross successful 2023. For nan adjacent mates of years, 2024, 2025, we now expect ADP OpEx per rider betwixt €17 and €20. This is surely €1 aliases €2 higher than our erstwhile guidance, chiefly driven by nan expected summation successful unit costs and power costs, arsenic Philippe explained. This effect mixed pinch nan stronger improvement of lower-margin businesses, successful peculiar astatine TAV lead america to set our EBITDA separator expectations for 2024, 2025, which we now spot betwixt 35% and 38%.

Extime successful Paris, income per pax is now expected astatine 29.5% successful 2025 versus antecedently 27.5% successful our past guidance, therefore, supportive to gross and EBITDA growth. Now adjacent slide. Building connected nan summation of rate generated by nan maturation successful EBITDA, we will proceed to deploy superior according to a balanced allocation. In position of CapEx, our erstwhile guidance excluded inflation. Now it is successful existent euros, meaning it includes inflation. The wide letter cover complete nan 2023, 2025 play is somewhat higher to bespeak that and besides to see immoderate further projects. At group level, we are now guiding for investments totaling astir €1.3 cardinal per twelvemonth connected average. This includes CapEx linked to Ankara concession renewal, arsenic announced successful December.

For EPS, we now expect astir €900 cardinal per twelvemonth connected average. As acold arsenic it is connected average, therefore, it could beryllium somewhat little successful 2023 and somewhat higher successful 2025. In summation to inpatient, this accrued letter cover corresponds to caller projects linked to nan first maturation of cargo business and besides an acceleration of nan electrification of Vegas. In position of returns to shareholders, our dividend argumentation remains successful changing pinch a 60% payout and a minimum dividend per stock of €3. We will past person elasticity to put successful our world improvement if opportunities arise. We will always, arsenic usual, and however, workout awesome financial subject successful specified finance determination arsenic our nonsubjective remains to deleverage our equilibrium expanse arsenic signaled by nan improved nett debt-to-EBITDA target betwixt 3.5% and 4.5% successful 2025.

Now pinch Philippe, Eduard, we'll beryllium happy to reply your questions, and I propose we unfastened nan statement for nan Q&A session.

Question-and-Answer Session

Operator

First mobility comes from nan statement of Cristian Nedelcu from UBS.

Cristian Nedelcu

First one, we've seen nan reliable guidance connected EBITDA for nan adjacent fewer years, nan different day. Could you show america possibly conscionable looking astatine nan Core Paris business, what level of postulation versus '19 levels do you request to get to nan aforesaid EBITDA successful Paris arsenic successful 2019?

The 2nd one, it's conscionable very adjuvant to perceive nan moving parts connected OpEx, nan increases successful OpEx successful '23. Could you thief america a spot quantify that? If you deliberation that nan wide Paris OpEx, what is nan incremental successful 2023 coming from unit third-party contracts and terminal reopening. And besides if you tin springiness america a hint connected nan power costs summation that you expect for 2024 versus nan existent levels.

The past 1 possibly connected nan incremental CapEx that you announced today. Could you thief america understand a spot amended nan divided betwixt regulated and nonregulated business? And if you are much assured successful nan result connected nan regulated WACC from nan regulator, do you judge there's higher chances location that they will summation nan WACC scope versus nan existent one? Thank you very much.

Augustin de Romanet

I propose that Philippe Pascal answer.

Philippe Pascal

Yes. Thank you. So I'll commencement by nan past mobility astir nan regulated scope. In fact, we expect a beardown capacity successful 2022 successful position of regulated Roche astatine a bully level. And that is simply a impervious that globally, we tin retrieve our accountability successful a bully position successful statement pinch nan traffic, successful statement pinch our performance. All successful all, it's besides nan impervious that we tin measurement by step, person much colour astir nan headdress successful position of worth creation successful nan regulated cap, what is nan level of regulated resistance and I tin corroborate that nan regulated mechanically, pinch this performance, it's higher than expected. But it's a small spot early to springiness you much colour astir that.

In position of incremental CapEx. What is very important for you to understand is nan truth that our caller guidance is successful existent euros. So pinch nan effect of inflation, nan ample portion astir 2/3 of nan incremental CapEx is linked by nan effect of inflation. The caller guidance, it's a measurement for america to springiness you much colour astir nan effect of inflation. As you know, for nan moment, successful our CapEx program, we executed immoderate activity pinch circumstantial agreements reason earlier nan inflation. So we don't observe successful '22 and a small spot successful '23, we don't person effect of ostentation successful our CapEx program. But successful '24-'25, we expect a immense effect owed to nan truth that we launched caller projects pinch caller statement pinch nan inflation. The ostentation is globally astir €250 million. So it's a main mentation of that.

In position of OpEx, to person much colour astir nan anticipation successful our OpEx by 2025. We have, first of all, an effect successful position of wages and sell. We person a earthy summation pinch earthy ostentation for our exemplary for astir 2.5%. It's nan earthy summation earlier nan COVID Crisis, and we travel backmost to this earthy increase. But we person besides nan effect of speech successful position of net measures. And successful this inflation, owed to nan caller statement pinch nan unions, we person a caller ground pinch an summation of €40 cardinal connected an yearly basis. So successful TAV OpEx, successful position of wages and say, mechanically pinch a immense ostentation successful Turkey, and pinch nan recruitment, we expect higher OpEx for astir €90 million. So it's a immense impact. And nan afloat effect of nan recruitment successful 2022 for much than 500 group person an effect successful our trajectory for nan adjacent year.

In position of consumable and outer traffic, we person nan effect of nan betterment of nan traffic, but it's not truthful huge. We don't person effect successful position of power successful '23, but we expect a antagonistic effect successful '24. It's a small spot early to speak unsocial because we person to discuss a caller statement to effort to mean this bad impact. In position of nan different OpEx, we expect an ostentation that is successful statement pinch nan different institution successful Europe. So each successful all, that is very important to note.

So first, we person a bully betterment of EBITDA. And arsenic you know, we tin scope EBITDA level of 2019 successful 2023. It's a very bully news and it's integrated growth. Second point, we're not -- but for nan capacity successful position of separator successful 2022, it's an exceptional capacity owed to nan accelerated betterment of nan traffic, but besides nan moderation of nan OpEx owed to nan truth that we are to enlistee to motorboat caller subcontractors. So we person an exceptional performance. And for nan adjacent year, we return, we travel backmost to nan accepted capacity of nan group. In fact, we tin spot our caller guidance. But each successful all, it's compared to nan erstwhile guidance, we conscionable changed nan higher portion of nan range. Due to nan truth that we statement that we tin summation successful unit costs, and we person summation successful energy. That's all. It's not a immense impact. So convey you.

Cristian Nedelcu

Thank you truthful overmuch Philippe Just a mini clarification. So connected Paris EBITDA, this postulation betterment to '19 levels is '24 to '26. Does it mean nan EBITDA betterment of Paris is besides successful '24 to '26 -- aliases tin you travel earlier than that?

Philippe Pascal

No, no. The EBITDA -- nan group of EBITDA has travel backmost successful '23. I'm very comfortable, and we person a bully move successful '24 and '25 and a beardown move owed to nan some elements. First, we person a afloat betterment of nan postulation betwixt 24% and 26%. And 2nd point, we person caller activities. And successful a unit area and successful nan development. And erstwhile you spot nan guidance of badness and EBITDA, you tin spot that we make a caller rate travel strongly. When you study our guidance, we tin spot that successful -- we person a bully capacity successful indebtedness nett and EBITDA, and we explain our trajectory EBITDA for nan full of nan group included successful price. That is simply a beardown performance.

Operator

The adjacent mobility comes from nan statement of Stephanie astatine from RBC.

Stephanie D’Ath

The first 1 is simply a follow-up connected nan power costs. Could you please punctual us, I judge you benefited from a headdress aliases authorities subsidy and erstwhile you expect this to rotation disconnected and power prices to effect your power costs much substantially. Regarding nan Extime initiatives, really overmuch much unit do you expect investments to beryllium made successful bid to use from this initiative?

And past finally, connected your accrued nonsubjective of €29.5 years per pax. Could you please explicate to america what has been driving this increase? Is it for illustration successful reverence coming back? Do you expect Russian tenders to beryllium backed by 2025, that would beryllium hugely appreciated.

Philippe Pascal

So Fran, your past question, income per pax and nan drivers. First of all, arsenic you know, we person different elements to thrust our performance. First element, it's a number of quadrate meters successful gait successful our commercialized area. That is not a beardown driver for nan adjacent fewer years. We don't return caller terminal, we conscionable refurbish, and we alteration nan commercialized area. We don't alteration nan measurement of nan commercialized area. The 2nd driver, it's a mixed traffic. In fact, we expect amended postulation for nan afloat betterment of nan world traffic. And successful this world traffic, we expect a flimsy betterment amended betterment successful position of Asia rider successful '23 and progressively successful '24 and '25.

The past driver, but it's nan much important neither is nan value of equipment and nan offering. That is simply a cardinal successful our strategy because we changed our strategy to instrumentality much fashion, and we instrumentality caller brands. And for example, we person caller shops. We person conscionable 1 shop of Ruida successful Terminal 2. Now we person caller shops of Leviton Internal 1 successful Paris and legal. And this caller goods, caller bonds return a bully spot successful our caller hospitality model. The 2 points is nan truth that we effort to instrumentality a world attack done clip pinch retail, but besides nutrient and beverage pinch nan utmost successful nan boarding area, we've launched pinch advertising. That is important to understand. It's nan world conception creates a immense capacity successful position of income contact.

So chiefly nan summation of nan income per pax successful '24 and '25 to scope our caller guidance successful '25, that is €29.5. It's linked by nan truth that we effort to instrumentality our exemplary successful our flagship, Terminal 2 and Terminal 1 successful nan complete terminal successful a manner terminal also. And that is nan first point. And nan 2nd point, it's making nan mechanic betterment of nan world postulation and nan betterment of nan postulation for nan adjacent year.

For nan Extime initiative. In fact, we tried to instrumentality our exit inaugural successful nan different terminal successful Paris, particularly successful Terminal 2B and 2D which is simply a caller terminal, but we person to retrofit this terminal successful Extime, -- and successful nan different airdrome of nan group, notably we tried to instrumentality that successful Antalya, but we person different constituent to different task for that. For nan power cost, we will hold for nan extremity of nan wintertime erstwhile we person much visibility to specify much successful specifications our attack for 2024 and we presently use from fixed value based connected nan tariff contracted successful 2020 and to not to use, but it's very important to reply your question, we not usage nan authorities tariff scheme. We don't usage nan headdress system. That is very important successful our performance. Our capacity it's conscionable linked by our erstwhile agreements and our hedging strategy.

Operator

Next mobility comes from nan statement of Elodie Rall from JPMorgan.

Elodie Rall

Sorry, I will travel backmost to immoderate of nan points discussed. But first, connected EBITDA. So location was a reversal of proviso that helped nan 22% EBITDA extremity margin. So tin you conscionable explain what was nan underlying EBITDA without that? And therefore, fixed nan summation successful OpEx that you expect from here, is it adjacent to presume that EBITDA separator will apt beryllium little successful nan '22 reported of 36.4%. So that's my first question.

Second, connected CapEx guidance. So I understand you're now including inflation. You said it's astir 2/3 of nan increase. So tin you punctual america what nan 1/3 remaining is, successful particular, successful Paris, fixed you said there's further task internationally. And tin you springiness america nan phasing of CapEx betwixt '23, '24 and '25 alternatively than conscionable an average, please? Is it going to beryllium much front-end loaded aliases back-end loaded?

And past mobility connected traffic, if I may. So your guidance for 23 implies fundamentally nary betterment from nan existent level. Why is that? And is it because you expect effect connected Asia, China reopening successful peculiar to footwear successful much successful '24 because your guidance fundamentally implies reasonably unchangeable trends for nan remaining of nan year.

Philippe Pascal

Thank you Elodie Rall. First of all, to further nan EBITDA. The EBITDA level is expected to summation powerfully for nan adjacent year. In position of margin, we person 2 effects. The main effect is nan operation of activities pinch nan substance of Almaty -- that is pinch a bully margin, but not astatine nan aforesaid level arsenic nan different activities of nan group. And nan effect of nan afloat consolidation of portion of our JV, particularly nan retail, but we person a very beardown leader pinch a beardown procreation of rate flow, but pinch a flimsy margin, a bully margin, beneath nan mean separator of nan group. So that is nan main mentation of nan mobility of margin.

The 1 mentation is nan OpEx level, but it's not truthful huge. When you spot successful our capacity successful 2022, that is your question, we person a one-off effect, but not truthful immense for astir €25 cardinal and €40 million. And astatine our we tin spot that globally astatine EBITDA level, we person astir 1 constituent of EBITDA separator that is linked to one-off elements. For besides unit expensive, positively impacted for €20 cardinal by a proviso reversal for nan objection of pension scheme. And we person different one-off effect that is nan spot taxation that we person bully news, and we reversed besides our proviso and a flimsy constituent that is not truthful huge.

So successful position of integrated performance, we don't person immoderate issues. In position of CapEx, truthful I said that globally, we accrued our -- nan CapEx level connected mean for nan 3 years aliases '23, '24, '25. The main mentation for '23 is nan ostentation for €250 million. But we have, successful fact, further task that is simply a very bully project, particularly successful position of cargo successful position of monotone, but besides successful position of optimization successful our capacity owed to nan acceleration of nan postulation successful -- astatine nan bosom of nan -- we person besides a flimsy constituent for illustration electrification, refurbishment that it's portion of nan scheme.

In position of phasing, we person a immense commencement of nan CapEx and much back-end loaded. So much successful '24 and '25. And for profit, nan recovery, successful fact, we are, arsenic you know, we effort to specify much precisely our presumption for '23, but we support our presumption from '24 and '25 for a afloat betterment betwixt '24 and '25 astir apt '24, but possibly '25%. In fact, we expect a progressive betterment successful position of postulation globally successful nan 2nd half of '23 for nan main part, but not for nan full profit level. But nan main effect is nan policies, nan strategy of nan airlines, but unfastened caller routes erstwhile we person a bully profitability, not set to unfastened to day a beardown title betwixt each nan airlines. But to presume nan truth that we don't reopen owed to nan profitability. So for nan moment, we are comfortable pinch this presumption successful position of profit successful price. So convey you.

Operator

The adjacent mobility comes from nan statement of Nicolas Mora from Stanley.

Nicolas Mora

I'll travel backmost again connected nan CapEx, possibly little connected Paris, much connected nan remainder of nan group. I'm not judge I rather understand why you would beryllium spending €1.3 cardinal connected mean betwixt '23 and '25. I deliberation TAV has already fixed immoderate guidance connected CapEx, for example, for '23, astir €220 cardinal to €260 million. So I'm not judge what other is contributing to nan delta betwixt €900 cardinal for Paris, which is good and €1.3 cardinal for nan group level? That's nan first question.

Second, connected retail. Could you explicate aliases springiness a small spot of colour connected why profitability was really truthful astonishing successful '22 successful retail. We person nan specifications of nan publication from SDA aliases nan aged SDA, wherever nan elaborate publication from retail. It's fine, but nan leftover is really amazing. That's really a step-up from what you utilized to present margin-wise successful 2019. So I was conscionable wondering what has changed? Why are you truthful overmuch profitable successful unit euro-for-euro now? And I will time off it there.

Augustin de Romanet

So for nan world CapEx, nan main mentation is nan truth that arsenic a caller concession play successful Ankara for that person to build caller terminals for period and astir for nan adjacent fewer years. So it's globally, €200 million. But astatine nan aforesaid time, we person to instrumentality our scheme our scheme successful Almaty. And successful Almaty, it's portion of nan mentation for astir €100 million, a small spot less. And we person besides a existent property successful nan world business successful at.

So globally, it's a bully news. It's a consequence of bully news. It's a caller task pinch a bully effect successful our P&L astatine nan extremity of nan day. For your mobility of nan unit activities, tin you conscionable explain your point, what is your property your question?

Nicolas Mora

So nan main mobility is your EBITDA publication from nan unit business successful Paris is beautiful monolithic successful 2022, particularly if you portion retired Extime and Core ADP, truthful your halfway business successful unit is now generating higher margins connected unit than pre-Covid. Is it because nan statement has now been improved aliases –

Augustin de Romanet

It's a value of things and nan caller luxury bonds for a immense part. And that is nan unit separator successful '22 compared to '19 for nan 2nd half -- conscionable for nan 2nd alpha nan effect of nan afloat recovery, it's very high, much than 40% compared to '19. And this is nan effect of nan caller strategy and pinch much manner pinch a world attack successful position of unit and pinch a bully move of traffic.

Operator

The adjacent mobility comes from nan statement of Ruxandra Haradau-Doser from Kepler Cheuvreux.

Ruxandra Haradau-Doser

Congratulations connected nan beardown capacity successful 2022 connected nan Skytrax rankings and nan rider restitution improvements astatine various terminals. First, sorry, if I missed that during nan presentation, but tin you talk astir tariffs successful 2024 and 2025, what tariff inclination shall we expect level increasing, decreasing?

Second, if I retrieve correctly, you were mentioning a fewer years agone astatine nan areas of Air France successful Terminal 2 are capacity constrained. Air France has almost restored precrisis capacity. So, really shall we deliberation astir terminal capacity requirements of Air France successful nan early and possibly immoderate indications connected awesome CapEx projects aft 2025.

Third, past summer, operational disruptions astatine immoderate airports for illustration Schipol U.K. airports affected each awesome airports successful Europe wrong a short play of time. So really do you spot nan airdrome strategy successful Europe prepared for postulation during nan Eastern holidays and summertime this year? Some airlines are presently mentioning that nan bottleneck this twelvemonth will beryllium nan aerial postulation power and peculiarly nan aerial postulation power successful France wherever immoderate IT systems will beryllium changed. So really concerned are you pinch respect to operational disruptions this summer?

And finally, could you please talk astir really nan restitution levels of labor astatine Aeroport de Paris arsenic compared to French companies successful general? I asked this mobility successful nan ESG convention past twelvemonth and Edward mentioned that you will beryllium capable to reply it only aft a study than astatine nan extremity of 2022. Thank you very much.

Philippe Pascal

So I commencement by your first mobility astir tariffs. So arsenic you know, nan level of tariff depends connected nan convergence betwixt nan regulated ROCE and nan related WACC -- that is and we request immoderate visibility astir nan regulated work. Keep successful mind that nan OpEx summation will put a spot much unit connected nan regulated ROCE. So a debased astir apt a flimsy summation successful position of tariff. And nan WACC should besides embark progressively nan existent marketplace condition, truthful expanding progressively. To beryllium very clear, we reached nan regulated WACC, our regulated ROCE reached nan related WACC successful 2018 and 2019. So we person a headdress successful position of worth creation successful nan regulated scope astatine this moment. With nan beardown betterment we mechanically summation our regulated ROCE, and we person to negociate progressively nan truth that we scope nan cap.

To negociate that, we person to return income nan level of OpEx. If you person much OpEx mechanically imaginable an effect successful our tariff increase. We person to negociate our CapEx programme erstwhile we scope nan cap. If we person much CapEx owed to nan needs successful position of capacity, it's imaginable to negociate nan truth pinch an summation successful position of time. And we person besides to negociate nan level of [indiscernible]. So clearly, I tried to springiness you nan different elements, but I cannot reply to your question.

The 2nd portion of Air France capacity constrain. Clearly, erstwhile -- conscionable a betterment business successful '19 and '20, we want to motorboat a caller terminal, that is simply a terminal 4 owed to nan truth that we expect saturation successful position of capacity for nan Air France. And we request a caller infrastructure 6, 7 years after. Now 3 years after, we person nan aforesaid constituent owed to nan capacity contained of Air France, but we don't person nan aforesaid strategy. So we effort to instrumentality our Pioneer strategy, and for that, we person 2 steps.

The first measurement is to optimize nan existent terminal that is imaginable to travel postulation summation of Air France, but besides for nan full institution successful CDG to hold a caller infrastructure, possibly '32, '34. But for this caller infrastructure, if you publication our Pioneer strategy, it's not a world terminal. It's possibly a caller boarding area, a caller aerial conflict system, a caller commercialized approach, but it's not a world infrastructure for nan afloat airdrome process.

For nan restriction, we don't person a regularisation successful Paris, and we don't expect restriction. In fact, we person immoderate activity for nan CD aviation. But each successful all, globally, for this year, we don't expect an impact. And for nan restitution of -- I could opportunity astir restitution of employees. First, successful December, we had an statement pinch unions for nan summation of wages for 2023. It is nan first clip successful nan history of nan institution that we person unanimity. So it's a first for 10 years, that we person unanimity of unions to judge nan summation of wages we propose. First.

Second, we are very transparent pinch our unions, and we did enquiry astir accent astir consequence of pain retired astir each nan tone -- authorities of tone of each our people. And this cognition leads to a very listed -- we stock nan business pinch nan unions. And I deliberation nan societal ambiance is improving very, very quick. I would springiness you an example. We had a onslaught of fireman past summer. And past week, I received a missive from nan fireman, warmly thanking america to person taken into relationship their requests, which is unique. They admit that we amended nan nickname of their qualification.

And past but not least, I will springiness you an accusation important that nan unions did judge to o.k. nan dividend of nan institution and they ballot successful favour of nan dividend, each nan unions, which was not nan habits successful nan company. So I could opportunity that we took this problem arsenic powerfully successful our hands, and I'm rather optimistic astir nan restitution of our employees. As acold I will propose them 3 stocks. We did denote yesterday astatine nan Board of Directors that we will instrumentality nan distribution programme we did denote successful PIONEER 2025, acknowledgment to nan stocks we bought erstwhile we had nan cognition pinch Royal Schipol Group. When Royal Schipol Group has sold is 8% successful ADP. We bought 0.3% dedicated afloat to distribution to our staff. I don't cognize if it answers to your question, but it's each that you tin opportunity today.

Operator

The adjacent mobility comes from nan statement of José Manuel Arroyas Sanchez from Santander.

José Manuel Arroyas

I will inquire 3 questions, if I may. First, connected nan tariffs astatine Paris for 2023 and nan level of activity that was utilized by nan regulator to o.k. those tariffs. I said particularly don't want to disclose nan nonstop values that were utilized by nan regulator. But could you -- I mean, conscionable successful position of clarity, could you -- I mean, I will inquire successful lawsuit you tin disclose those. And if this leak is successful your opinion, nan 1 that we should see sustainable successful nan mean term.

The 2nd mobility is really overmuch longer do we request to hold earlier ATP starts caller negotiations and consultations for a caller era -- and nan 3rd mobility is connected world investment. I wanted a mates of clarifications. First, what do you precisely mean by being unfastened to caller world investments? Would this beryllium done done ADP aliases done nan 2 world platforms, TAV and GMR. And successful narration to GMR, would ADP beryllium unfastened to supporting nan company's equilibrium sheet. Thank you. Okay.

Augustin de Romanet

So for your 3rd question, truthful we frost nan tariff for 2023 owed to nan truth that we person a beardown betterment successful position of profit. We person a bully move successful position of review, and you tin support astatine a bully level. We don't person successful '22 and astir apt a portion of 23, a immense effect successful position of inflation. So for us, it was important to not to summation nan tariff erstwhile we don't request to summation nan type. Probably successful nan adjacent fewer years, we person inflation. We person a caller CapEx program, and we person to summation nan tariff. But erstwhile it's not necessary, we frost nan pace.

Globally, we've erstwhile you frost nan tariff, we person a mechanic infer successful position of regulated. The French regulator successful nan determination is not very clear astir nan level of headdress and nan level of regulated ROCE. It conscionable approved our tariff strategy and amended nan fees of time. But successful our exemplary successful nan business exemplary of 23 that we present to nan French regulator. We person underline an anticipation successful position of regulated ROC. So if nan French subordinate approved this regulatory ROCE, this business case, it's owed to nan truth that it's astir apt little than nan regulated. When you successful nan adjacent fewer weeks erstwhile we disclose our regulated ROCE for 22 and mechanically, erstwhile you modelized to exit ROCE for 23, we tin spot that globally, what is nan scope of nan regulated astatine acceptable for nan French event. That is astir apt astir 4%, possibly a small spot more. But it's difficult to spot precisely what is nan position of nan French regulator.

So your 2nd mobility successful position of economical narration agreements. why we talk astir now an economical regularisation agreement. First of all, erstwhile you person an economical regularisation agreement, we person a committedness successful position of CapEx program. We person to present nan CapEx program. If we don't person capable CapEx program, we person immoderate issues successful position of regulation. So it's not nan infinitesimal to person a beardown committedness successful position of CapEx program. We tin spot our strategy. Last year, we decreased a small spot much to our CapEx to optimize our model. This year, we person a caller guidance that we tin see, but we person a immense effect successful position of inflation. We effort to alteration our airdrome model. So it's not a infinitesimal to hole a level of CapEx for nan adjacent 8 years.

Why 8 years? Because we person to discuss during 2 aliases 3 years, nan economical regularisation agreement. So, this statement is for 5 years. So we request nan visibility for 8 years, but it's not nan lawsuit now. So successful '23, we don't person to activity astir economical regularisation agreement. And it's a bully news for our shareholders because we effort to negociate nan situation, to sphere our room of maneuver to travel our recoveries. In fact, astatine nan aforesaid moment, we cognize that astatine nan extremity of nan day, our regulating ROCE reached nan regulated back, and we person conscionable to negociate to enactment astatine nan headdress level, not to mechanically to summation nan tariff. Tariff depends connected nan business strategy, particularly for nan CapEx programme for nan adjacent fewer years.

In position of world development, clearly, we are very selective, but we are unfastened to a caller opportunity. That is very important for america to cheque if we person a bully equilibrium and if we person a bully worth creation compared to bias. The privilege is still biased because we don't person a immense risk, and we person a batch of needs. But if we person to hole nan future, they person to present world development. And successful this point, successful fact, we person a improvement for TAG, mainly. We tin spot that pinch Antalya, pinch Ankara, eat tomorrow pinch nan Nigeria and nan Montenegro and done GMR Airports. That is not consolidated, but it's very important to for illustration a level to create nan group pinch privatization of India linked by nan beardown dynamics successful position of hierological activities. We tin spot a immense improvement of India.

But not least, nan world development, it's not conscionable airdrome business. It's besides nan unit business done nan improvement of our caller ones, that is time. And for that, we effort to instrumentality these bonds, say, Antalya, possibly different airport, Almaty, but besides successful caller surface science for illustration North America. We don't request for this development, caller injection of nan mother institution successful JV and successful GMR. We tin negociate this situation. It's nan bosom of our strategy to person an world level developer. But pinch a bully dynamic. In fact, we person to deleverage powerfully GMR part. It's a communal target pinch nan GMR family. And we person besides to stabilize nan business of TAM aft this beardown improvement successful Antalya and Ankara.

Operator

The adjacent mobility comes from nan statement of Graham Hunt from Jefferies.

Graham Hunt

Just 2 short ones from me. Firstly, you mentioned adding astir 500 successful position of headcount successful 2022. I conscionable wondered what that number -- you're expecting that number to beryllium successful 2023 successful position of further headcount. And past connected walk per pax, are you capable to break retired nan effect of your assumptions astir ostentation connected that higher guidance versus possibly wherever you're seeing capacity a small spot higher than you were expecting nether nan Extime brand. So conscionable nan divided betwixt nan effect of ostentation and underlying capacity location connected that caller guidance.

Augustin de Romanet

So nan effect of nan recruitment successful '22, we successful fact, we accrued powerfully nan unit pinch much than 500 people. And this effect will beryllium for nan afloat twelvemonth effect for astir €20 million. All successful all, we person to proceed nan treatment, chiefly to institution nan betterment of nan postulation but we tin negociate astatine nan extremity of nan day, our infrastructure pinch little group compared to 2019 for astir 700 group and that is important to do.

In position of income per pax, I don't cognize that it's imaginable to explicate much than we person to explicate before. We don't person a immense effect successful position of inflation. We person an effect successful position of value and truthful on, but not truthful immense arsenic nan ostentation was modest. It's conscionable an integrated capacity owed to our value of traffic, value of open.

Operator

The adjacent mobility comes from nan statement of Dario Maglione from BNP Paribas.

Dario Maglione

Congratulation connected nan beardown H2 results. I person 4 questions. First one, what was nan OpEx successful ADP SA successful 2022? And what should we expect for 2023? Second mobility connected regulated CapEx successful Paris complete nan adjacent fewer years. What should we expect is simply a scope of €550 cardinal to €650 cardinal a bully range.

Third mobility connected liking spans for 2023, what shall we expect?-- and 4th mobility connected unit revenue. I noticed that gross from different shops by restaurants was very beardown -- what is driving it? Is location immoderate one-off effect?

Augustin de Romanet

So first, successful position of OpEx for nan OpEx of ADP mother institution successful 2022, I'll fto you spot successful our property release, we person each nan figures. In fact, we stabilized our OpEx, and we person conscionable an summation compared to nan traffic, and we person conscionable noticed successful astir 15% compared pinch a beardown summation successful position of much than 80%. So for nan adjacent twelvemonth and for '23, we expect nan afloat effect successful position of rate costs owed to nan awesome determine successful '22. But I spot intelligibly nan existent figures. We don't expect a immense summation successful position of power because we person nan headdress and nan separator system. And we person -- for nan different cost, we person to renegotiate nan portion of our statement pinch our subcontractors. We person disclosed successful nan presentation, nan level of contracts that we person to renegotiate, but it's not truthful huge. But during nan negotiation, we expect a flimsy effect successful position of inflation. So astatine nan moment, it's not truthful immense for 2022 successful position of OpEx by their parks. Our capacity is nether control, this 7.6% per pax.

A reminder that I explained intelligibly conscionable before. It's nan truth that successful '22, we outperformed our building of costs owed to nan truth that we negociate our infrastructure without each nan group that we need, and we person a bully building to negociate our costs beneath nan effect successful position of inflation. So it's an exceptional year, and we person conscionable a recovery, not a betterment successful normalization successful our tariff future. For nan 2nd question, successful position of regulated CapEx, we tin spot that we generally, we person 2/3 of regulated CapEx and 1/3 nonregulated CapEx. For nan adjacent fewer years, we person much nonregulated CapEx owed to nan truth that it's a diversification, cargo, caller luggage information strategy that is nonregulated.

For nan 3rd question, nan liking spend, I tin springiness you immoderate colour astir that. We tin spot conscionable our figures successful our accounts. But we don't person to disclose these different elements. We tin spot presentation, nan truth that connected average, nan mean cost, it's €2.3. And conscionable for nan modern institution for ADP SA is 1.9%. Globally, we person a very bully building pinch a stock of fixed days for astir 90.4%, not variable, 94. So very nan afloat debt, it's a fixed rate. And for your past mobility successful position of retail, I don't understand intelligibly what do you say? What is nan wide unit shop?

Dario Maglione

Revenue, gross successful different shops aliases of restaurants was very beardown successful Q4?

Augustin de Romanet

So I deliberation we tin cheque pinch nan IR squad because I don't spot that we do you need.

Edward Arkwright

So, owed to excessively galore different constraints we have, it's now clip to adjacent this presentation. Thank you, everyone, for having logged connected to our conference. We're looking guardant to seeing you each successful nan coming days and weeks. Our adjacent financial connection will beryllium connected nan 26th of April pinch our Q1 Revenue Disclosure. Feel free arsenic good to get successful touch pinch nan champion investor relations teams successful France and possibly successful Europe, I mean Cecile Combeau and Elliot Truck. [Ph] This squad is astatine your disposition for immoderate questions. So, pinch that, bully day, everyone.

Editor: Naga



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