Good afternoon. This is the conference operator. Welcome, and thank you for joining the Aena full -year 2022 results presentation. As a reminder, all participants are in listen-only mode. After the presentation will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Ignacio Castejón, finance director. Please go ahead, sir.
Thank you very much. Good afternoon, everyone, welcome to the Aena 2022 results presentation. This is Ignacio Castejón, speaking Finance Director at Aena. I'm here today with Maurici Lucena, Chairman and CEO, and José Leo, CFO. Mauric will go through the key highlights of 2022, José will cover the business and financial performance of this year. We will end up with a Q&A session, as previously mentioned. Thank you very much for joining our call today. Maurici, please, the floor is yours.
Thank you, Ignacio. Good afternoon, everybody. Again, welcome to our 2021 results presentation. I will host, as Ignacio mentioned, the call along with José Leo and the said Ignacio Castejón. At the end, we will be very pleased to answer all the questions you may have. I will start with traffic. We are really seeing solid figures in the initial weeks of 2023. What is more important, the capacity that airlines are scheduling for the summer season have or has made us to review upwards our 2023 traffic guidance for the Spanish network. I would like to remind you that our previous guidance was 27%... Excuse me, 87%, 97%.
We have revised upwards this guidance to 94%, 104%. This is obviously good news, and I think that this demonstrates the solid trends that our industry is experiencing so far. Concerning 2022, Aena Group increased its profit, its EBITDA. The main reason was that we experienced a very strong recovery of 81% of the traffic compared to 2019. Again, I'm referring to Aena as a group, the global group. In particular, the Spanish network experienced a recovery of the traffic compared to 2019 of 88.5%.
I would like to underline once more than that, this recovery was completely impossible to foresee at the beginning of 2022. Let's again remind that at that moment, we were going through the Omicron wave. The comeback of the traffic has been completely unforeseen, very strong, and we are very happy and proud that Aena could manage, could accommodate this very strong comeback of the traffic with I would say no operational problem.
This, it's good news in absolute terms, I want also to remind you that we were probably the sole exception in Europe, in the sense that the Spanish airports were the only ones that did not have operational problems in the very challenging summer of 2022. Of course, this was not only because of the, let's say, high-quality management of Aena. I'm referring to the managing of the traffic. It was also due to very specific Spanish laws in the labor market. All in all, we are happy that we could manage this very strong comeback of the traffic, because in the end, it was even stronger, the recovery, than in the rest of Europe.
In particular, leaving aside Spain, in Luton, the recovery was 73% of the traffic of 2019. In Brazil, the recovery was even better, 100.1% of the traffic in 2019. An important matter of this presentation is the following one. Aena has changed the accounting policy applied to MAGs reductions in the annual accounts. Consequently, rent reductions are registered in full at the time they occurred, rather than deferring them, the impact of these MAG reductions over the remaining life of the lease agreements. Therefore, Aena has restated the 2021 annual accounts and also 2022 figures. José Leo will comment later on the accounting change and its impact on revenues, EBITDA and net profit.
Leaving aside the figures, I would like to underline that, at least, it seems to me that this is good news because, in my opinion, it makes our communication of the financial results to the market, let's say, cleaner. Probably we have finally left aside the confusion that arised from the difference of the evolution of our actual revenues and the accountability or the, excuse me, the accountant, the accounts and the 2021 and 2022 figures. I hope that this makes your life easier because, with this accounting change, I think that the interpretation of our figures and the evolution of our activity is, as I said, cleaner than in the past.
Our total consolidated revenues amounted in 2022 to EUR 4 billion. This, I would say, taking into account our starting point in 2022, I would say that this total consolidated revenue is dazzling. It's explained by the traffic growth and the outstanding performance of the commercial activity. For instance, 2022 commercial sales have exceeded 2019's, and by 1%. This means that there's that we have experienced a very, very strong increase in spending per passenger. This, along with the recovery of the traffic, have boosted the commercial activity in 2022 to pre-pandemic levels, let's say, before than we have expected. Again, we are very happy with this novelty, of course.
On the other hand, in the same line, speciality shops and food and beverage since November 2021, we have awarded more than 240 tenders, and the MAGs have been really good. For example, MAGs in the mentioned 240 tenders are higher on average than in 2019, 22% in 2024, and 46% in 2025. Yesterday, the board of directors awarded the food and beverage activity at the Madrid Barajas Airport, and we are deeply satisfied. We have not also diversified the kind and the...
of restaurants and also the companies that are responsible for these restaurants, but also the financial results of this contract or of these contracts have been very, very good. For example, 2023 MAGs in Madrid Barajas Airport, again, we, I'm referring to the food and beverage activity, are on average 32% higher than in 2019. We are also very excited with the duty-free tender. You know that this tender is the world's largest duty-free tender with more than 20,000 sq m. We expect that this activity that will take place in this 60,000 square meters will generate sales of more than EUR 18 billion during the 20 years length of the contracts.
We have so far succeeded attracting the best and the good of the industry. We expect competition will be very fierce and this will translate into, we expect, very good financial results when the tender is resolved. Concerning the OpEx, the operating expenses in 2022 amounted to EUR 1.14 billion. This means 19.7% higher in comparison to 2019. This is very important, if we, for a moment, exclude the impact of the electricity, the increase would have been 0.6%, which means EUR 5.5 million, which I would say it's not bad at all, taking into account the inflation pressures that have presided the economic activity at least since the end of 2021.
In the midterm, you know that Aena is strongly committed on developing renewable energy sources. We expect to soon we can become self-sufficient in this area. If I now leap to EBITDA, our EBITDA for the period stood at EUR 2.1 billion. I'm again referring to 2022. This EBITDA includes GBP 91.3 million from Luton and BRL 366.5 million. All in all, this is translated in a consolidated EBITDA margin that closed 2022 at 49.1%. We are still a little bit far from where we want to be again in EBITDA margins around 55%. We will reach again that percentage of EBITDA margin.
In any case, it is clear that with the EBITDA margin of 2022, Aena clearly remains among the highest in the airport industry, which again, I think that clearly demonstrates the solid figures and profitability of the company. On the other hand, consolidated net profit, as you know, return, and this was good news again, to the positive territory, and it stood at EUR 901.5 million . We were very happy yesterday at the board of directors to propose to the annual general shareholders meeting that will take place next April to distribute a gross dividend of EUR 4.75 per share.
This is the first time since the coronavirus showed up that the company will remunerate its shareholders, which, you know, is our traditional and very important policy since Aena went public. I will now start the final part of my presentation. Concerning Brazil, I have not very relevant news. You know that in Brazil we won the concession to run 11 additional airports in Brazil. This is very good news again. We will manage at the end of 2023 around 20% of air traffic in Brazil. The execution of the concession contract is expected to take place in the spring. Finally, concerning ESG.
ESG, as you know, is one of our top priorities. I want to highlight three milestones. First, Aena joined the Toulouse Declaration, which makes clear our commitment to achieve zero emissions by 2050. In the case of Aena, I can assure you that it will be before 2050 and probably before 2040, which is our formal commitment. Second, Aena has achieved the highest rating awarded by the Carbon Disclosure Project and Sustainalytics has recognized our company as the best company in the IBEX 35 for its environmental, social and governance performance. Third and finally, Skytrax has distinguished Aena as the best airport group in the world for its excellence managing the pandemic. This is all from my side for so far.
Thank you very much. I now will give the floor to our CFO, to José Leo, and I will come back at the Q&A session. Thank you. José, the floor is yours.
Thank you, Maurici. Okay. Can you please show the slide? Thank you. Well, first of all, I'm going to spend some time talking you through the change in accounting policy. You all are well aware of the fact that in October 2021, the DF7 determined that we couldn't carry on charging the standard rent that were included in the contract, we needed to haircut them, to reduce them significantly. At that time, there was a discussion with auditors and technical accountants as to whether or not we should take that to P&L in one go. The answer was no. IFRS 16 applied. We had to defer the impact over a number of years.
You know well we were disappointed by that because we were somehow in trouble to try to explain the gaps between the underlying business, the commercial revenues, and on the other side, the cash flows. That struggle ended when the IFRS Interpretations Committee released the so-called agenda decision at the end of September, I think. Yes, the end of September. October 2021. To be more 2022. Sorry, I'm mixing Octobers here. The decision ended up in a very clear conclusion. This kind of, let's say, rent forgiveness processes or reductions should impact the P&L as the decision is made. This was very welcome by us.
I have to stress the fact that last year's accounts were prepared correctly on the grounds of the existing accounting policies at that time. This year's accounts are also prepared correctly on the basis of a new development, a new interpretation by the, let's say, leading institution in Europe, taking care of the IFRS. The outcome is very clear. We retrospectively are accounting for these write-offs in 2021, and we are restating the 2021 accounts that are presented in the 2022 account set for comparison purposes. The impact, to cut a long story short, is what you can see there.
At EBITDA level, 2021, EBITDA has been corrected by EUR 553 million. The net profit for 2021 is now, after restatement, EUR 415 million less. That could complicate the comparisons, but my recommendation is to, let's say, forget about it, and to move on and to focus on 2022 and beyond. Now the business can be followed more intuitively because EBITDA and cash will go, let's say, will develop consistently. 2022 accounts are different from those that would have been produced under the former accounting policy. 2022 has never been formulated or prepared on the former accounting policy. This is just a what if.
That what if is what you can see there. EBITDA would have been EUR 293 million less, euros less, and net profit would have been EUR 219.7 million less in that what if situation. I hope you have managed to follow me and to understand it, but otherwise, I will be more than happy to come back to this. Okay. Looking at some of the indicators that were already discussed by the Chairman, I will only make some additional comments, if you like. No? I think the Chairman already went through them in good detail and very meaningfully.
First of all, the traffic recovery is being more substantial than we expected. Is coming earlier, is faster to the point that you can see now we are estimating 2023 to deliver 99% of the 2019 traffic. Let's say, for the sake of argument, 100%. That means this is like bringing forward one year, one entire year, the expectations we had back in November when we presented the strategic plan. Let's say, by way of summary, the traffic is getting to that point one year earlier. I have to be very clear as well. The range that we are providing is broad, and the reason for that is that there are still uncertainties.
Everybody living in this world knows that geopolitics and macro conditions are not yet clear. That means that there is risks inherent to this estimate. If we take that away, clearly all the indications in the industry are very positive. For the same reason, the airport revenues, the aeronautical revenues are growing obviously consistently with traffic. I have to say the yield in 2022, I'm sure you have noticed, on a per passenger basis is less than in 2021. That's understandable. The charges went down. On the other hand, there has been a positive development.
In the last quarter of 2022, we have seen the airport charges per passenger going up on a like-for-like basis, because obviously you have to remember that there has been a number of months in 2022 when we were charging an extra EUR 0.80 per passenger to recover the COVID costs. On a like-for-like basis, the fourth quarter of 2022 is delivering better airport revenue yield per passenger. Commercial revenues, as the Chairman said, are being a success. Hopefully, we knock on wood that will remain, but we are very, very positive about this momentum. The underlying sales, the amount of money that passengers spend at the airports overall for the whole set of activities is going up.
To say it's going up by 1%, but it's still going up on 2019, and that is really, really good. Of course, there are different activities that are performing differently, and we can discuss that later for reasons that are perfectly understandable. Overall, the, the underlying activities at the airports are going north vis-à-vis 2019. Likewise, when you look at the information provided on page 26 of this presentation, I'm not suggesting you to move to that yet, it's clearly indicating that the trajectory of the revenues delivered through the ongoing day-to-day activity, what we call fixed and variable rents, is really positive. They are above 2019 in overall. They are above 2019 on a per passenger basis.
They are better than the rest of the 2022 figures on a per passenger basis at the end of the year. Even improving as the year was passing. Also, the main categories are all of them delivering better revenues than the 2019's with a couple of exceptions, as I said before. I'm sure we can discuss it later if you wish. This is the summary for me of the key messages coming out of this slide. Very good, very healthy underlying trends in the business. EBITDA at 49.1% margin is good news as well, is somehow bringing forward our expectations that we have for later on in the strategic plan horizon.
That means that we are heading towards delivering the 55% that we estimated at the strategic plan could be feasible and achievable. Remember, the 62% that we used to achieve before the pandemic is not anymore in our reach, at least for the coming four years or three years. Different thing is later on. For the time being, I think 55% is a good target and still best in class. Should we move on to the next slide, please? In terms of the operating costs, I'm not going to dwell on this anymore. I think that there is a clear message here. Excluding electricity, we are flattish on 2019. This is good news.
It's good news because, although it's clear that the current traffic level is not yet at the 2019 level, the business is at full speed, full steam. All the facilities are open. You have to deliver services as if you have the level of passengers you had in 2019. There's a very relevant element of fixed costs in our activity. The standards, the quality standards, the requirements are much higher than they used to be. All together means that being flat in terms of operating costs is very good news. Going forward, we expect to make the most out of this, mind you, of course, there will be extra costs as we grow, no? The reality of the business is different.
Having said that, Let's say the big one here is the 55% gross margin, EBITDA margin that we are determined to achieve, and we are even more certain today than we were three months ago that we will achieve. Moving on to the next slide, and this will be the last one. I think the cash generation is also a very relevant indicator of how healthy the business performance is. We are delivering close to EUR 1.9 billion of cash generated by the operations. If you take a look at this, obviously, cash is not affected by the change in accounting policy, no need to adjust anything. Clearly now this is consistent with the close to EUR 2.1 billion of EBITDA.
This is good news. This is, as I said before, and the Chairman said before, this is making the follow-up of the business more intuitive. Well, there is only a difference of EUR 200 million. That EUR 200 million, if you go to the statement of cash flows, we'll see is the tax. In 2022, in the last quarter of 2022, we are paying EUR 177 million from memory in taxes, in corporate tax. In Spain, the corporate tax is paid mainly upfront. When you file your return in June, July next year, frankly, the cash adjustment uses to be minor. The bulk of the payment is made in the last quarter of the year before or of the current year.
In, if you adjust this EUR 177 million payment of the corporation tax made in the last Q4 of 2022, you can see that the cash generated by the business before investments and debt repayment is EUR 2.1 billion. Exactly the same figure that we are generating as EBITDA. This is good news, and this is also an indication of our ability to convert EBITDA in cash. The cash conversion rate is close to one. The debt to EBITDA ratio is now at 3x . You know that in the absence of attractive investments or we are not going to increase the gearing. We are not afraid of doing that for the right reasons.
Otherwise, this will carry on going down, up to 2%, sorry, up to 2 x EBITDA. O nce again, unless we find good opportunities and good return investment to be made. This is it. Without further ado, I would ask the operator to open the Q&A session. Thank you.
Thank you. This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. We will pause for a moment as callers join the queue. The first question is from Ivar Kelly of UBS. Please go ahead.
Good afternoon, thank you for the presentation. Given you expect a faster traffic recovery in 2023, how should we think about OpEx this year relative to 2022? Specifically, what increase in FTEs do you expect, and what's the likely inflation third party contracts and electricity costs? Secondly, rents collected per passenger were EUR 4.93 in 2022. How do you expect that to evolve in 2023? Finally, excluding the provision reversal, EBITDA came in lower than expected. How should we think about EBITDA in Brazil and Luton for 2023? Thank you.
I didn't fully understand your second question, we will come back to that. Well, in terms of the OpEx for 2023, as you know, we are not providing guidance. This must be absolutely clear from the beginning. What I can tell you is our trajectory is, let's say our focus is to get to what we believe will be a feasible EBITDA margin in this business. We expect that to be 55%. Well, we would be delighted if we can review that at any point in time. For the time being, we believe this is the realistic target. What we can see today is that at 49%, we are closer than we expected.
Without providing any guidance on 2023, in the absence of any negative development from the point of view of the geopolitics, the war, the macroeconomic events, I would say the traffic expectations, the traffic estimates that you could see in the strategic plan would be brought forward by one year. So to speak. That would accelerate, that would give momentum to this opportunity to get to 55%. For 2023, of course, I would expect to improve this margin, I would expect to improve the revenues. That means that mathematically in 2023, it is more likely than not that we won't be flat on OpEx vis-à-vis 2022. But on the other hand, we don't expect major increases or double-digit increases. Why?
Because once we get to the 2019 level and we incorporate all the changes in the business reality, standards, quality standards, things like that, we are nearly there. I know I'm very ambiguous, but I don't want to share with you any particular view on operating costs of growth for 2023 or gross margin for 2023. Without providing you any figure, this is the trend. Traffic is brought forward for one year. The EBITDA margin now is at 49%, you should expect in 2023 to be better and are not going to be flat. Setting aside the energy, which frankly, by the way, is going the right way, energy costs are now much less than we expected for the end of 2022 and the beginning of 2023.
This is it. With regard to the provisions, you said when taking out the impact of the accounting restatement or whatever we call it, the EBITDA is below expectations. I'm not sure. I would say there are many of your colleagues that think otherwise. If you take a look at the fourth quarter, if you take a look at it, EBITDA is better than is proving to be better than in previous quarters, obviously adjusting for the seasonality. Net profit is better than the fourth quarter. The only one that, let's say at first sight, you could see the fourth quarter is You could think the fourth quarter is weaker in terms of cash flow generation. The answer is no, it is not.
Simply, we are paying EUR 177 million of taxes. From any angle you look at it, the fourth quarter is better than the previous one. I have a number of papers produced by colleagues of yours this morning saying that we are slightly, but still better than expected. I don't know how you get to this conclusion, honestly. What was the second question, please?
All right. With respect to slide 29, where you set out the fixed and variable rents invoiced per passenger of EUR 4.93. If you can give us any color on how you expect that to evolve in 2023, please.
No. In terms of higher revenue, if this is the question, frankly, I don't know. Without providing any further information, you know that there are two elements to be considered there, or three elements. Element number one is the traffic. You know what our view on traffic is now. Element number two is the airport charges approved by the CNMC. You know what they are. Number three is whether or not there will be some sort of dilution or concentration in the yield. I think we are heading for more dilution. How much? I have no idea, because that will be fully dependent on the traffic mix and the airports mix, and so on and so forth.
With that in mind, you can get to your conclusion, frankly, without us telling you what is our view on, specific view on yield per passenger for aero revenues. Hopefully, I'm answering your question, but I'm not fully sure.
That's all right. Thank you very much for that.
The next question is from Stéphanie D'Ath of RBC Royal Bank of Canada. Please go ahead.
Hi. Good afternoon, thanks for answering my question. The first one is a follow-up on OpEx. When you mentioned that electricity prices were going in the right direction and were coming out slightly below expectation for 2023, would it be fair to assume that the total cost of electricity will remain, sorry, will come down year-on-year between 2022 and 2023? Regarding staff costs, you mentioned in one of the slides that at the Spanish airport level, you were basically flat versus 2019 in terms of OpEx. Does that mean that your savings that you are keeping from the pandemic more than offset the third party contractors, contract in-price increases? If I'm not mistaken, before the pandemic, you were highlighting that those would be increasing double-digit.
Any color on energy and staff costs would be appreciated. My second question is regarding commercial spend per passenger. Could you please give us a little bit more color on what is driving this very strong performance in terms of which passenger group is maybe spending more? In your strategic plan, you forecasted a 12% increase between 2019 and 2026, which I guess doesn't really cover for inflation. Do you think that for the spend per pax, you could reach that target earlier than foreseen, as you are reaching the traffic pre-pandemic levels earlier than foreseen? Finally, my last question is on press speculation that you would consider selling down your stake in the latest Brazilian 11 airport block acquisition.
Any comments on that would be appreciated. Thank you so much.
This is Maurici Lucena. I will answer your last question concerning Brazil. At that moment, we are fully concentrated on the execution of the contract on the beginning of the new stage in which we will take full control of the 11 airports. Our policy, I would say, is very simple. When we invest in an international airport, we want to manage it. In the case, in the future, we would consider the participation of an investment fund or a financial partner. It will be, first of all, of course, keeping the control of the infrastructure on Aena's side.
Secondly, I would say that we want to demonstrate through our, through the quality of our management, that we can fully deploy all the targets that we established when we considered the acquisition of the infrastructure. In other words, so far we are not analyzing any investment, any sale in the future when the 11 new or additional airports are demonstrated well run, we could eventually consider, but it's not on the table, and it's not our plan at the present time. Thanks.
Thank you.
Hi, Stéphanie. On the OpEx, clearly the cost of electricity has come down over the last months, this is good news. This is something you can notice in the quarter four set of results, you would see that in the first months of 2023, should you be able to see it. This is a very interesting situation in which if that, if this is the case over the rest of the year, 2023 of course would be delivering better outcomes than we expected. We don't know. Nobody knows. The next question is, should we hedge? Of course, we are looking at it, we hedged something at the end of 2022, in December, actually, some 10%.
Why so little? First of all, the market is not deep, it's not broad. Second, the curve is very steep. You can be enjoying very good spot prices, when you look at the curve beyond a point, you see that it's getting steeper. You feel a little bit stupid hedging too much, no? This is because the market is probably well, not able to provide the right level of, let's say, hedge that many people would require. On the other hand, I think in this particular electricity war or gas war, I'm not an expert, no, I'm just guessing expectations on market conditions are not, let's say, going together.
We are in that process of finding ways of not speculating and hedging a part of the bill. Frankly, unlikely or impossible to think of hedging the majority or things like that over the coming months. In the meantime, we are enjoying the good spot prices that frankly, in some cases are reaching levels of 60% or even less of the bill we were paying at the, let's say, toughest part of the crisis. With regard to commercial, yeah, okay, I can give you some more color, some headlines, but if you want to follow up, of course, please be in touch with the IR team over the coming days or hours.
I could say that the duty-free activity, the activity run by currently is benefiting from a number of things. I'm starting with this because it's very significant. First of all is the British passenger. They are spending more. I suppose they are taking advantage of their new condition, they are not anymore, obviously, E.U. citizens, and they can benefit from the, let's say, duty-free shopping. There is also a general increase in the average ticket volume or amount per passenger. That means that there is an inclination to spend. I don't know if this is sociological or it is, I don't know, whatever you call it, psychological, it is already in the very patent.
When you look at other activities like food and beverage, definitely there is a propensity to spend, to eat, so to speak, that is going north very significantly. Also the average ticket price is going north. Of course, the flip side of that coin is specialty shops. Not many. A good number of them still remain closed. At the end of the year, I think, there were still around 12% of them closed. That means that the total spend on the specialty shops is going down. Luxury is not doing well in our business. It's not doing well here in Aena. I don't know, somewhere else. Publicity, obviously advertising is still lagging behind.
For instance, the use of car parks is really growing very significantly. People are using our car parks at levels that are not very far from 2019. Maybe this is driven by the high weight of the domestic market in this recovery, which is changing now. Now we have extremely good levels of international traffic. Rent a car, amazing. Rent a car is a business where there was a shortage of cars. That meant that the average contract price went up dramatically. Still, people pay. They don't care. They keep paying. The revenues are going up not only on a per user basis, but in absolute terms. This is just descriptions. Obviously, you need some more detail. The IR team will be happy to help.
I hope that will give you the color you were asking me to provide.
Thank you.
The next question is from Elodie Rall of JP Morgan. Please go ahead.
Hi. Good afternoon. Thank you for taking my questions. The first one, I'm sorry, can I just follow up quickly on your guidance on OpEx? You said flattish, 2023 versus 2022. I know you gave us comments, basically, are you now assuming electricity costs to be slightly down, staff costs and other costs to more than compensate that fall in electricity cost? Is that the base case that you're guiding for when you say flat cost, flat OpEx in 2023 versus 2022? That's my first question. Second question, if we look at the recovery of COVID costs, I think you reported EUR 156 million in 2022, of which, EUR 40 million-EUR 50 million in Q4. What should we expect going forward?
Lastly, if you could give us an update on Barcelona, given utilization or capacity utilization there seems to be around 96%. You've had, we know the extension plans are on hold. What's the plan basically for Barcelona? What could be the impact if the investment is really delayed? Thank you.
Hello, this is Maurici Lucena. I will answer the last question concerning the Barcelona Airport. All I can say is that, you know, our which strategy we have followed in the past. We proposed a specific model and a specific project of expansion. This was rebuked by the Catalan government. We said from the beginning that for the project to be feasible, we needed the green light of the Catalan government because this project, due to the very specific future features of the Barcelona Airport, would have environmental consequences. We said that this green light, this regional green light was a necessary condition.
When we did not obtain this green light, it meant that the expansion of Barcelona was not included in DORA II. I would say that the novelty in the last weeks and months has been that there has been a political agreement that comes from a budget agreement in Catalonia between the political party which gives support to the Catalan government and the principal party in the position, the Socialist Party.
This agreement, this political agreement will materialize in an institutional and technical analysis in the coming months, in which the Catalan government and the Spanish government will eventually decide which alternatives are evaluated in this technical and political analysis. The position of Aena is very clear. We will wait until this analysis starts, when it starts, we will just follow the requests that are conveyed to Aena. I cannot say any more. It is true, on the other hand, that the original agreement, political agreement, states that the Barcelona Airport is... How, how would I translate that into English? I mean, the commitment is that it will gain aeronautical capacity.
This is all that the political agreement stated, and we'll see. We'll see what the future defines. On another question you mentioned, I would say that in the short, coming future, capacity is not a problem in Barcelona, and I think that this will remain true for at least a few years. Thanks. I will now give the floor back to José.
Hi, Elodie. Well, on your first question, I didn't provide any guidance on OpEx, please don't call it guidance. What I said is, first of all, we are not providing guidance on these sort of things for 2023. What I said is, we are closing 2022 with the operating costs, excluding electricity costs, being flat on 2019. We can see now that with the new guidance for 2023 on traffic, we are bringing forward, let's say, the recovery, let's say 1 year, more or less. That means that I expect the margin to improve, obviously on the current 49%, probably faster than we expected.
I said, that doesn't mean I'm saying the operating cost for 2023 would be flat on 2022 and 2019, excluding electricity, always excluding electricity. Whether electricity plays a positive or negative impact, let's take it apart. The rest of the operating cost would be more likely than not, will be higher than in 2022. Our duty, our objective, our focus, is to make sure that growth is moderate. Is moderate and by no means reaches the double-digit. Believe me, it's not easy. I would say it's impossible to run airports these days on the same cost base that in 2019. If there is anyone in Europe, I don't know Asia or I'm not familiar enough.
If someone says that in Europe they can run similar level of, let's say, activity in 2019 in a large or significant airport in Europe at the costs of 2019, well, I don't know. I would say that's not true. 2023 operating costs, more likely than not, they will go up. We are determined to make that growth, let's say as limited as possible, by no means reaching double-digit, and more importantly, to be able to speed up the process to get to the 55% or EBITDA margin that we believe is realistic, is the realistic one in the current context of the, let's say the business. If in one year or two years we believe we can reach 60% or 62%, we will let you know, but it is unlikely.
Finally, the recovery of the COVID costs. The COVID costs now are being dealt with in a different way. For the 2023 charges, the CNMC allowed us to recover the 2022, to be more precise, the quarter two and quarter three COVID costs of 2022, only to the point that the final outcome of the airport charges for 2023 remain flat. That was the decision of the CNMC. That means that in 2023, the charges, the airport charges that, by the way, will start to apply on the first of March, so tomorrow. These charges will allow us to recover only 40- something million, I don't remember the figure exactly. EUR 45 million of COVID costs.
The rest will only be recovered in 2024. That's the plan. Now, as we speak, we are not incurring any more COVID costs. This is part of the past, hopefully forever. What is true is that there is still some amount outstanding that will only be recovered in 2024 because the regulator decided not to allow any euro to be recovered if that means the charges would go up on year, on the previous year. This is it. By the way, everything we postponed the recovery, we are entitled to recover the cost of capital on that amount, let's say, accordingly.
Okay. Thank you. If I can just confirm one thing on the mags impairment. We're no longer gonna see any of these, right, with the restatement made? From now on, commercial activity match, the cash flows, P&L and cash flows matches, right?
Exactly. There is only one case which would contradict this, but it would be always immaterial. Let me put you an example. Imagine at the court, a judge decides to let's say that one of our operators that in our view was not subject to the DF7, for instance, an advertising company, are entitled to the DF7. At that moment, we will need to account for a write-off because the decision would be taken at that time. But this will be always exceptional situations, and by no means you can think of a material amount. Okay. Just to be absolutely precise, the rule now is you take the hit, you make the...
You take the losses exactly at the time a law, a court decision or whatever says you are not entitled to recover that amount. Once again, the big deal was the DF7. This is part of the past, you shouldn't expect any more material impact going forward.
Great. Many thanks.
The next question is from Nicolas Mora of Morgan Stanley. Please go ahead.
Yes. Just three follow-ups, please, if I may. Just you on commercial and the retender of the duty-free, you stated you expected some fierce competition. I mean, can you maybe give us a little bit of color how you think the tender is going? You know, we've got the 10 interested parties. I think from the press, you're now expecting the technical and economy report by mid-May. What is there left for you to do to foster even more competition from here? That's question one. Question two, just on cost and third-party services cost, what contracts do you have left to be renegotiated in 2023? What kind of inflation would you expect in there, and especially with regards to the Spanish minimum wage?
Is there a risk your wage bill will go up markedly in 2023? I mean, you've hinted to limited inflation year-on-year, but just a bit of color on the wage side. Last point on CapEx, your peer ADP flagged low inflation in the CapEx bill from 2024 onwards. Is this something you're worried about as well at Aena, especially in Spain? Thank you. That would be it.
Okay, Nicolas. With regard to the duty-free tender, clearly we have been working hard to make sure that the tender was shaped to attract competition, and we believe we have achieved the goal. There were a number of amendments introduced in the former way we tendered out this kind of contracts as, for instance, including a range of products that was not in the scope before, such as luxury goods, allowing flexibility in terms of, well, more flexibility in terms of the designs, extending the length of the contract, preventing any single bidder to be able to take it all.
Well, making sure that they involve the technology in their bidding so we can benefit and they can benefit out of what they sell, are selling outside. Well, a number of things. I'm not an expert, but one thing. We have been attracting, we have attracted a good number of operators. You can see them on page 16. For the first time, we have Asian and American players looking at the process. We will remain very confident that there will be a good outcome. On the other hand, the precedent in terms of the rest of the activities are really, really brilliant. This is it. We made sure that the ingredients were there to attract the competition.
We believe the competitors are already showing up, we are really positive and looking forward to seeing their bids. With regard to the cost of the third party services, let me take a look. I think. Do we have the detail of what kind of No? Well, Nicola, probably the best way to go ahead with this is for us to provide you with this. Clearly our experience these days is as follows. Anything we are tendering to third parties, the sort of aggressive bids that we had in the past are not anymore on the table. I mean, in terms of operating costs. We will come back to investments, our CapEx later.
You can say that in any single deal you are making to procure this kind of services, you are missing something for sure. Of course, this is the result of the inflation pressures, the minimum wage is going up, and also that the contracts are being shaped in a different way. We are asking them to take more risks. After the COVID, they realized that they had huge risks. What they, the suppliers are now saying, obviously, if I take more risks of downside, I have to price that risks. How much that will impact on 2023 new contracts specifically, I have no idea. No idea. Hopefully it won't be double-digit. This is what I said before. We are very good at running these processes. We end up in every single case in electronic auctions.
What we are not seeing is people, the competition disappearing. We still have competitors, but clearly they are not bidding as aggressively as in the past. Honestly, I cannot tell you whether that will be 5%, 10%. On the other hand, the number of contracts that we will be awarding in 2023 will represent a fraction of the total portfolio. That will be somehow distributed over a number of years, not only year one. I know I'm not providing very detailed or very precise information because frankly, it's what I can give you at this stage. CapEx. Well, CapEx is an interesting case.
CapEx, the Spanish government approved back in August a new ruling, I don't know if this is a law or not, by which any institution, any public institution, and Aena in that case is part of that, should be open to consider proposals from their contractors to increase or to review the prices up as a result of the pressure on their procurement, let's say chain. We have a number of applications already. They are subject to very strict rules. We believe that if this crystallizes in cost increases in some of the CapEx plans, wouldn't be terribly material.
I'm not able to provide you a precise figure, but probably would be something like EUR 100 million-EUR 200 million. That would mean that the bar will be increased. On the other hand, we need to make room for that. We may end up agreeing on postponing some of the projects that are not strictly necessary. Other than that, we haven't seen anything, any major, any other major wave of, I don't know, people walking away or not bidding. Not at all. Still competitors, still people applying to make the works. This is the only thing that we have to keep in mind, that we may need to review some of the contracts slightly.
Excellent. Thank you, José.
The next question is from Dario Maglione of BNP Paribas. Please go ahead.
Hi. Four question from me. One on wage increase for 2023 for Aena Spanish staff. How much is the year-on-year increase rate agreed, and could that change during the year? Second question on yield concentration for 2022 to be recovered in the K-factor. What was the final amount for last year? Third question on underlying commercial revenue of the passenger, which was up 10% in Q4 compared to 2019 levels. What are you seeing in January and February, if you can potentially share the data? The last question is actually on the duty-free tender. There are many bidders from around the board, and that's much better than the original bid almost 10 years ago. You definitely have achieved higher level of competition for this tender.
I'd like to understand how you will select the winner. Let's say there is one bidder who offers a much higher rent than the current rent. However, maybe this bidder has fewer credentials than the incumbent, Dufry. How will you strike a balance in choosing who wins the concession? Thanks.
Okay. Frankly, I didn't understand your second question. We will come back to it. In terms of the salary increases for 2023, salary increases in the business will be 2% fixed plus a potential 1% extra. Subject to a number of conditions. You can take 3.5% for granted. We believe is fine. Is not, is moderate, is fair, is balanced. This is it. In terms of the duty-free co-process, as I said before, we have been working hard to get to design the tender in a way that people are attracted, they are coming to bid.
For close to one year, 10 months, our colleagues in the commercial business and the advisors they retain have been traveling the world, meeting people, talking to people, trying to understand what they need. And of course, together with their own knowledge, they ended up by shaping the contract, by shaping the tender in this way. The tender will be based on a combination of, let's say, the technical, the offer the bidders will be making and obviously the economic element of it. Frankly, still is very much dominated by the weight, the relative weight of the economic offer is higher, to be perfectly honest. This is Aena's tradition. Some people like it, some people hate it, but this is Aena's view of life.
At the end of the day, it will be awarded to. Unless there are major differences in the quality of the offer they are making, it will be very much driven by the economic conditions. For the time being, we have been able to engage, as I said before, I don't know, three, four, five times more people than we did in 2012. That I believe was the last time we tendered this out. Please, if you can say again, second question, I didn't quite hear.
Oh, thanks for that. Yeah, the second question on yield concentration for 2022 on the aeronautical side. If you can tell us what was the total amount for 2022 to be recovered in the future tariff?
Okay. Actually, 2023 ended in dilution.
Yes. How much was the amount?
In dilution, in EUR 43.6 million. This is 2022. For 2023, well, who knows? I would bet it will be dilution as well. As traffic is growing and load factors are going up and, well, large airports are coming to help, unlike one year ago, where it was all driven by touristic airports. That, for sure, will end up in more concentration. Sorry, concentration. I got it wrong. This time, yeah. Concentration for next year. Dilution this year. I got it totally wrong. Anyway.
I'm sorry.
This year, dilution 43.6%.
EUR 43.6 million.
Million. EUR 43.6 million.
Mm-hmm.
I got los a s you can notice. EUR 43.6 million of dilution. Going forward, we are more likely to end up in a concentration case.
You will recover the EUR 43.6 million with higher tariff in the future, but then for 2023.
Exactly. You are exactly right. In 2024.
Maybe the last question was on the trends in underlying commercial revenue per passenger, which is pretty strong. I just wanted to know whether that is continuing in January and February.
In commercial, you mean?
Correct. Yeah, commercial revenue.
Well, I will struggle to be committal on this. The trends are very positive, I don't know. First and foremost, we are not providing guidance. On the other hand, we have to keep an eye. I don't know for how long this per passenger basis growth trend will be. Obviously, over the longer run, as you know, we have commitments in the strategic plan because we are going to develop different offering, different ways of getting to the customer. Of course, there is a commitment and there is a very, very good plan. Over the coming months, in terms of months or the coming year, I'm not sure.
I don't know whether this healthy trend of people spending more on a per passenger basis or higher tickets, I don't know whether this is going to be sustainable over the coming years. Frankly, I have no idea.
Yes. Thank you very much.
Okay. I would ask you to make one question per person. We have five more people in queue. I would like to finish by, let's say, in 10 minutes, if that's okay. Obviously, we can follow up offline with the IR team.
The next question is from Marcin Wojtal of Bank of America. Please go ahead.
Yes. Thank you so much for taking my question. Could you comment a little bit on your refinancing strategy? You've got a bit of debt coming up in 2024, 2025. Are you going to use Eurobonds or maybe bank financing or maybe you're just going simply to repay some of that debt? If possible, can you also clarify why your cost of debt has increased so far very little? It is still, on average, just around 1% even though you have 20%, which is on variable rates. Thank you.
Well, the refinancing strategy now is honestly for 2024, open-minded, open-minded. We are working on it precisely as we speak, and we will see what is best. Of course, I think Aena would be very well fit to be in the bond market, but not at any price and not if you don't need it, you don't need that financing for too long. Open-minded, that's the. For sure, we are conscious that we will have to do something about the 2024 peak. We are extremely relaxed. As you can imagine, this is mainly driven by the COVID related financing decisions, so it's fine. In terms of the cost of debt, we obviously, we have a massive chunk of debt link in fix or hedge or swapped.
This is the reason why we are clearly able to keep the average cost so low. The team can give you some more color, precise color, but this is the headline. Next one, please.
The next question is from Achal Kumar of HSBC. Please go ahead.
Yeah, hi. Thank you, gentlemen, for taking my question. I mean, all the most of my questions have been answered. Just couple of things I wanted to understand. First of all, on the traffic guidance, you have guided to do 104%, up to 104%, but then you have mentioned that the base case is 99% of recovery. I mean, what makes you so cautious in terms of traffic guidance? While I can see that, you know, there is quite a lot of optimism about the recovery, where do you think, where are you more cautious in terms of recovery? Secondly, in terms of Asia-
Please, please.
Of course.
Can you just simplify, make a question? Otherwise I think José Arroyas, who is in queue will be upset. Sorry, Achal, it's simply that we are running out of time. Okay? If that's okay, you can follow up with the IR team. It's simply that I need, I will need to go and.
Sure.
This
Sure. Sure. I can follow with IR. That's fine.
Please, apologies. In terms of the, of your question, you can say that the range of the estimate is broad, you are right. You can think, taking the midpoint is prudent, and you might be right, frankly, the current conditions around the world, around Europe are, let's say, making any sort of assessment difficult. When you sensitize this to the risks around, well, frankly, it's almost technically wrong to go to the... Technically, I mean, based on the work done by the people, experts running these models, that to go to the extreme north of or south. There are significant uncertainties in Europe now that would make the traffic, the air, let's say, the air transport traffic, let's say, potentially being affected.
Is a very sensitive thing. They... To put it in simple terms, air traffic can be reacting very quickly and very significantly to any wrong geopolitical or macroeconomic evolution. You see now people spending nonstop, but what if things change? This is driven by, let's say, statistical and econometric models. I just go and present it. Thank you. Hopefully, it will be more than 99%. Who knows? Today we are not so sure. We have the final question already.
Yes. The final question is from José Arroyas of Santander. Please go ahead.
Hello, gentlemen. I think this one is for José. Within your electricity bill in the Q4, could you give us an indication of how much was the compensation for the gas plants, and how do you think this will perform in the first quarter, at least? Thank you.
Okay. You mean the gas cap?
Yes.
Which I will need to check it. The team can help you with this. You are right. When you pay your electricity bill, you have two components. One is the market price, the other one is the gas cap mechanism. I don't have this information handy now, so I will send it over. We will send it over. Thank you very much. I think we have finished. See you at the next occasion. Goodbye.