Hello, and welcome to the Groupe ADP 2022 Q1 Revenue. Please note this conference is being recorded and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the presentation. This can be done by pressing star one on your telephone keypad to register your question. I will now hand over to your host, Philippe Pascal, CFO, to begin today's conference. Thank you.
Good morning. Good morning, everybody, and welcome for the first quarter conference call. I am with Christelle de Robillard, that is, Deputy CFO, with Cécile Combeau, that is, the new Head of IR, and with Elliot of IR team and Lola for communication team. I am very proud to welcome Cécile on board. Welcome, Cécile, in Groupe ADP, as Head of IR, and obviously we are together here to answer at all your question. First of all, to go directly to the highlight of the first quarter of 2022, with three main points. First point, the traffic.
We also had a strong increase in terms of traffic at the group level, up 80% compared to 2021, in line with our assumption for this year. At the group level, compared to 2019 level, we reach 62%, 62.6%. That is a good level also in line with our assumption, despite still uncertain sanitary and geopolitical context. What is key for the moment is to remember that for the Ukraine crisis, our exposure globally is very slight. In Paris, we are around 1.4% of the total Paris traffic in 2019.
For TAV, it's slight more with its position at 17% of the traffic in 2019, but third of the traffic of the international traffic and with some specific platform assets, with more good exposure, Antalya, more with 37% of the traffic coming from Russia and Ukraine. This conflict is bringing uncertainty, however, as we come out of the pandemic and enter the tourism in Turkey, we also see some positive sign with other source of traffic like U.K., Denmark, for instance. All in all, in Paris, we don't see a huge impact and in Turkey, we have, it's a little bit early to speak about that, to know exactly the consequences of this crisis.
We have to wait the summer season, and we have to wait the tourist season in Turkey especially. The second point of this first quarter is our performance in terms of revenue. We have a solid increase in terms of revenue + 80%, 79% compared to 2021 with the integration of Almaty Airport. Without the integration of Almaty Airport, the revenue is up to 70%, that it's also a good organic performance.
The last point, but you know very well this element, it's a fact that in this first quarter, we published our new strategic roadmap, 2025 Pioneers, and we are still in transition for a new airport model, and we try to launch now a new model of airport, and we can have a specific point about that. First of all, perhaps more color and more details about the traffic. Slide four in our presentation. We can see our recovery of traffic, that it's a good recovery in line with our forecast. At the group level, 62%, 62.6% compared to 2019 level. At the Paris Airport level, 61.4% compared to 2019. In the other platform around the group abroad, 63.1%.
It's good performance. When you see slide five, we can see that the recovery of the group, it's more dynamic in the international asset compared to Paris. We can see a strong recovery in TAV, linked by the touristic airport. We can see +74%, very close to 75% in Antalya, 60% in Izmir, 76% in Bodrum. We can see also a strong performance in Almaty, despite the event of the beginning of the year in Kazakhstan. With a strong recovery with 104%, so more than the traffic level in 2019.
We have also a significant performance in terms of domestic traffic, especially in GMR Airport, with a strong recovery in terms of domestic traffic and also a global recovery from New Delhi with 70.8% compared to 2019 and in Hyderabad with 68.4% compared to 2019. When we have a specific focus, slide six, on the for the traffic at Paris Airport level, we can see that compared to the other platforms with our competitors in Europe, especially with Heathrow, with Madrid, with Amsterdam Schiphol, with Fraport, we have a good performance with 61.4% and with a huge increase in terms of number of passengers.
We have also a specificity that we are very dynamic in Paris only, with a strong increase of 68.8% compared to CDG, with just 58% of the traffic compared to in 2019. The main indicators for Paris Airport is the fact that we have a good dynamic in terms of local traffic compared to 2019. We can see a good performance in terms of international traffic also with 41% of the global traffic for the moment. In terms of revenue, that is slide seven, we can see that we have two main effect. First effect for all the companies, for ADP mother company, but also for TAV Airports, for our Amman Airport, but also for our JV in terms of retail.
We can see that we have a good dynamic linked by this recovery of traffic. All the our revenue increase strongly at the same level than we can see the traffic recovery. We have also a good organic performance in term of sales per pax, despite a slight decrease compared to 2021. We can speak about that. But a slight decrease compared to the first quarter of 2021, but a good performance for the moment compared to 2019. We are still in a good position with a good dynamic in sales per pax. That is for the first quarter. The second part of this presentation is to have an update about our strategic roadmap 2025 Pioneers.
First of all, slide nine, we can see that we believe in our business and we know that the airport, the air transport is essential for the world economy. We believe that it's possible through progress to decarbonize our activities and to stabilize our situation and to have a global and local approach to improve our performance. We have slide ten, the three main pillar of this strategy, One ambition, One Group, and Shared dynamics. That is a key point for us to build a multimodal connecting hub in all our airports, design and operate sustainably at the service of the city and the region.
We believe that it's a multi-local group for global change that is key to develop the group through TAV, through GMR, but also to be Turkish in Turkey, Jordan in Jordan, and so on, and Indian in India. In terms of update for this roadmap, we are still delivering our strategy in this first quarter. For example, in terms of hospitality, excuse me, we reopen Terminal 2G in CDG in April with our new brand, Extime, with a new hospitality approach, with design, with services, and with a good offering in terms of retail.
We believe that it's a good model to create value through Extime Paris, with synergy between operators, with a unique and grand experience. We believe that we can stimulate our demand through a good digital ecosystem, and we try to optimize our JV business model. It's an ongoing process, and we are very proud to open this new infrastructure with this new brand. The second delivery for this strategic roadmap for this first quarter, it's in terms of environmental approach. Another core element of the new airport model we are building with 2025 Pioneers is sustainability, as you know.
Our ambition is to be the pioneers in inventing the airport of tomorrow and be among the leaders to drive the environmental transition of the aviation sector. Last month, we presented you our ESG strategy, as you know, called 2025 Pioneers for Trust. As you remember, we have set for ourselves the objective to tend towards zero environmental impact in our operation with material evidence in Paris by 2030. As part of this trajectory, the reduction of carbon emission is of utmost importance.
Therefore, in order to back our commitment with science and leave no room for ambiguity regarding our will to align with the 2015 Paris Agreement, we are engaging through SBTi, that is the Science-Based Targets initiative, to apply for the definition and official recognition of carbon emission reduction targets. Our detailed science-based objective will cover both our internal emissions, scope one and scope two, and the external emissions, that is the scope three, with a near-term time horizon. We will also set a 2050 net zero science-based trajectory compatible with 1.5-degree scenarios linked to our clients' own climate trajectory.
The process has started this month, so we are very happy, and we have to submit formally our objective within maximum two years from now. As you know, the urgency of climate crisis will obviously push us to work within the shortest possible time frame. Good delivery for the first quarter in line with our strategy. Slide 13. We have an update on the decision of the French regulator on the principle of allocation of assets, revenue and expenses. On 11 April, the Transport Regulatory Authority has issued a decision complementing the guideline on cost accounting principle. We have eight principles of allocation with equal importance, and we have the list in Slide 13. That is auditability, homogeneity, non-discrimination, relevance, priority to direct allocation, reconciliation and traceability, stability over time and transparency.
Eight global principles, but we have also guidelines to precisely all these principles. In terms of implementation, we have in the decision of the French regulator, we have a specific transition period until 2025, and we have a process to have a standard consultation with airport users, that is, mainly, the airlines, to discuss about this cost allocation. For the moment, we don't expect a huge change, but we have to discuss and to launch this new consultation. At the end of the day, when you see the slide 14, we can see that we confirm all our guidance and our assumptions, traffic assumptions, group EBITDA margin guidance, net financial debt, net EBITDA ratio guidance and the assumptions in terms of investment.
For the moment, for this first quarter, we are online and we try to launch our new strategic plan with first good implementation as you can see. Thank you. We are now available for your questions.
As a reminder, if you would like to ask a question, please press star one. The first question comes from the line of Elodie Rall of JP Morgan. Please go ahead.
Hi, good morning. Thank you, Philippe, for the presentation and for taking my question. I'll just have two. First of all, could you give us an update on the unwinding agreement and the sales between ADP and Schiphol? Second, now that we have the results of the French election, could you give us your view on a potential likelihood or renewed likelihood of a privatization of ADP? If yes, what would there need to be done in terms of the Loi PACTE and its application and the change in the concession duration? Thank you.
Thank you. For your first question, it's difficult to comment on this element for the privatization. As you know, we have not seen the topic in the program of the re-elected president. Perhaps, as you know, it's not a key priority for the future government. In fact, the PACTE Law is on the table, and it's possible to launch the privatization. For us, we haven't seen this element in the program, and we don't expect that it is a key priority for the government. For Schiphol, for the moment, it's difficult to comment.
You have to wait. For the moment, we do not comment on our relation with specific investors. Thank you for your question.
Thank you.
The next question comes from the line of Cristian Nedelcu of UBS.
Hi. Good morning. Thank you very much for taking my questions. Maybe the first one on the OpEx growth this year versus the prior year. Could you give us a bit of color? What sort of wage inflation should we consider? What inflation in the contract with third parties or other suppliers or energy, electricity increases year- over- year? The second one still on your midterm targets for ADP SA operating expenses of EUR 16- EUR 18 per passenger. If I calculate well, this is a bit below 2019 levels. Could you elaborate on the main drivers of achieving this lower OpEx per passenger considering inflationary pressures out there? The last one, also a bit sort of midterm.
If we think at 2024 free cash flow, you have in place a guidance of EBITDA at around EUR 1.8 billion. You tell us about CapEx of EUR 1 billion. I think cash interest, EUR 250 million, cash tax, EUR 300 million, are rough estimates on my side. All in all, I'm seeing a free cash flow of around EUR 250 million-EUR 300 million per year in 2024. Does this number make sense? Am I missing any important cash movements? Could you give us a bit of color there? Thank you.
Thank you for your questions. About the impact of inflation on our financial figures. First of all, as you know, in terms of revenue, our aeronautical fees in Paris historically are managed with IPC approach. Globally, we try to increase our aeronautical fees in line with the IPC. First of all. Second point for TAV, 90% of TAV revenue are indexed with inflation, which is protective. In terms of revenue, we don't expect for the moment a huge impact. In terms of OpEx, in Paris, energy prices are hedged until end of 2023, so we don't expect an impact before 2024. For the contracts with suppliers, we stabilize our portfolio with long-term contracts.
On average, it's four years. This policy is good to protect our OpEx base from sudden peaks of inflation and we have a very protective policy clearly, and if we have an impact, it's a progressive impact. Finally, in terms of CapEx, that is not your question, but I think it's good to answer, because in this policy, in fact, we can have and we are still now with an impact of inflation in the construction cost. We also have the flexibility to reduce CapEx as we are in an annual tariff approval process. All in all, for the moment, we try to manage in a good way the inflation. Your second question about our guidance in terms of OpEx per pax.
As you know, our guidance, it's between EUR 16 and EUR 18 per pax in 2025. Compared to 2019, in fact, it's in line, not higher, but in line. In 2019, we have also our performance, well, that's EUR 16 per pax. Globally, we try to stabilize our cost per pax, and we have some room of maneuver to manage this situation through the question of inflation. The recovery of the traffic, we have a specific range linked by the fact we have probably a strong recovery and fare better than expected. Okay. For the free cash flow.
For the free cash flow in 2023 and for the next years, it's difficult to give you some colors because we disclose all that is possible to disclose and we don't manage the free cash flow in public with public figures. In fact, now we can see that we have a dividend policy, we have a CapEx plan, and we have a good trajectory in terms of revenue in our trajectory, but we don't have good news like capital gain for Schiphol, like a good recovery in our international assets and dividend policy, like a strong increase in terms of real estate or retail.
All in all, it's our approach very cautious in terms of figures and obviously we try to improve our free cash flow.
That's very helpful. Thank you very much. Sorry, wage inflation in France, should we assume in line with inflation this year and next year or lower?
In terms of inflation in our business plan, it's very clear we take the figures of the French government for France and for all the governments around the world. It's a public figure.
Understood. Thank you very much.
The next question comes from the line of Andrew Lobbenberg of HSBC. Please go ahead.
Oh, hi there. I just wanted to follow on from Elodie's question about privatization. Just keen to understand that here across the sea was the privatization mentioned by any of the parties? What is the attitude of the different parties that has been communicated publicly towards the concept of privatization now? Coming back on the announcement of the regulator with these principles of cost allocation, can you just remind us of the broader process and the broader timing when we might expect other announcements towards you know defining the perimeter of the regulated business? Just a very quick one. Why is the traffic in Almaty so strong despite the events earlier in the year? Yeah, I'm puzzled. Why is it going so very strongly?
First of all, in terms of privatization, when you see the dynamic in the French election, and when you see the current geopolitical context, we can see that we have a war in Ukraine, and that is a key element. Obviously, airport it's a strategic asset, first of all. Obviously, the priority for the French government is to manage the global situation, to manage the question of inflation, and to manage the environmental transition. This is the key point to explain the fact that the optimization of the portfolio of the French state is not a priority for the government and for all the parties.
Perhaps at the end of the day, we have a privatization, perhaps, but it's for the moment when you just read the program, it's not a priority. It's difficult for the management to comment this kind of topic. The second point, in terms of regulation, when you see the principle, we can see transparency, auditability, direct allocation, and so on. In the current cost allocation rules for ADP, we apply mainly or we apply globally all these topic. We don't expect with these new rules a huge change. Just to apply the principle.
At the same time we have a new process with the airline because we have to give more transparency in our figures, in our rules. That is good for all, for that is good for airline, that is good also for airport to have a debate about that. Perhaps at the end of the day, we change one, two, three, four key. At the end of the day, it's not possible to change globally. Perhaps with this small change we have an impact. We don't know at the end of the day. That is the key element.
That is important for us, the fact that for the moment, the French regulator put on the table principles in line with our policy and we just have to create enough confidence with airlines. It's we have confidence in our capacity to prove that our rules are fair for all the airlines. It's a debate, so we don't know exactly the consequences. In terms of Almaty. Almaty, when you see the figures, we have a strong increase in terms of domestic traffic in Almaty.
That is just the fact that when ADP try to develop its portfolio, we try to go to a specific country that has a huge potential in terms of growth, traffic growth. Now we can see that Almaty is a key position in terms of flights between Europe and Asia. As you know, with the restriction for the flights in Russia, Almaty probably is a good position and a good airport between both Asia and Europe. We are very confident to develop the traffic, domestic traffic, but also international traffic at the end of the day.
Thank you.
We currently have no questions on the line. If you would like to ask a question, please star one. Next question comes from the line of Marcin Wojtal of Bank of America.
Oh, yes. Thank you for taking my question. So firstly, just on the impact of the war, Russia, Ukraine, can you just comment a little bit on what is the impact right now on the traffic between Russia and Turkey, Russia and Kazakhstan? Is there any meaningful traffic going on right now or it is close to zero? Question number two, I believe that there will be some changes in the French air traffic control system over the next few months, I believe in the north of France, if I'm not mistaken. I mean, do you expect any disruption, any impact on your traffic, or that is not really relevant? Thank you.
For your second question, for the moment, we don't expect a huge impact, and it's not relevant. We manage the situation with the French civil aviation. In fact, at the end of the day, it's probably a good news because the French civil aviation improve its system, and we can have more robustness in the traffic. For your first question about the impact of traffic, first of all, your question is about Turkey, first of all, in Paris, we don't see a huge impact, because in fact, we don't have traffic and passenger between Paris and Ukraine and Paris and Russia.
We have a huge dynamic for the other destination. In Turkey, it's not the summer season. It's not the peak of the tourism in Turkey. We have a good dynamic with U.K., for example, U.K. passenger in Antalya, with Denmark, with Germany. This good dynamic probably, for the moment, it's in line with a decrease in terms of Russia and Ukraine. It's too early to draw any conclusion. In fact, we have a strong decrease with Russia and Ukraine, for example, in Antalya. We have still traffic, but it's not a zero.
We have traffic, but it's not at the same level compared to the last year, obviously. It's too early, and we have to wait the summer season, the touristic season in Turkey, that is a critical moment for us. We are cautious. Perhaps we have an impact, but for the moment, it's a little bit early.
Thanks. Thank you for this.
The next question comes from the line of Cristian Nedelcu of UBS.
Hi. Thank you for allowing me to follow up. Maybe on traffic this year, could you remind us the latest on the summer capacity schedule versus 2019 from the airlines? Overall, how do you assess the possibility that your traffic in Paris should be above the higher end of your guidance this year? Secondly, you had this retail contract tender that took place in March. Could you offer us a bit more color there and a bit more on the timeline and expectations? Thank you.
For your second question, we don't disclose anything for the moment. In fact, we have a tender, but it's a little bit early to speak about that. For your question about the traffic in Paris and the summer season and the schedule of airlines, for the moment, we can see that airlines expect a huge recovery during the summer and with a huge capacity program in Paris, especially our main clients. So that is probably a good thing. In the recent weeks, we are very positive, but it's also a little bit early to speak about that. We consider we are fully in line with our assumption.
We have an assumption in terms of traffic in Paris, and we can confirm that this assumption for the moment is a good assumption with a good dynamic, global dynamic. Thank you.
Thank you very much.
The next question comes from the line of Nicolas Mora of Morgan Stanley. Please go ahead.
Yes. Good morning, Philippe. Just coming back on that traffic outlook. I'm sure you've seen, yesterday Heathrow was also quite bullish into summer.
Forecasting a bit of Armageddon and disappointing winter. What are you hearing from your main airline customer, namely, Air France, easyJet, on that outlook? Are we just basically having the best time of airlines right now and expecting very tough winter outlook? Is that where you stand as well? Why you may be a little cautious? Number two on retail, just wanted to come back on a bit on the performance the first quarter. I know it's not very—it's not the most relevant quarter for retail. But are you confident what you're seeing in terms of maybe less drop than expected in spending despite the traffic mix headwind bodes well for the rest of the year?
Are you confident duty-free is resilient, food and beverage is properly picking up? That will be two questions. Thank you.
Thank you, Nicolas, for your first question. Just one thing. We are positive, but we are cautious. For the moment, we can see, like you, a good dynamic, but we are cautious because we are in line with our assumption, and we can confirm our assumption without for the moment enough view to change our guidance. The main things, it's the question of the competition between the airlines. In fact, all the airlines put on the table a huge program, but it's a way to maintain the competition with the other airlines.
At the end of the day, what is really the good load factor, what is really the program, we have to wait. We have to wait. It's a little bit early. In fact, we are positive for the moment. In terms of retail, first of all, perhaps just a reminder that in our expectation, we can see in the Capital Markets Day, we expect in 2022 sales per pax performance below 2021 level, just slightly below, but below. We are for the moment in line with our forecast. In fact, the first quarter is not relevant, clearly.
We have slight good news and good performance, but we have also, like, some issue that we have to check. First of all, is the fact that our traffic is affected by the pandemic in Asia. We don't expect this year a huge recovery in term of Asia traffic, but we have put in our assumption some element in Asia that is for the moment that we have to check, first of all. Second point, we have a recovery in term of European traffic, and that is also globally that we have an impact in this element.
As you know, Q2 and Q3 are generally contributing quarter. We have to see the question of domestic traffic for holidays with family. That is a question of duration of traffic. Globally for the moment we are happy with this performance more than expected. In fact, globally, we can confirm in our Capital Markets Day that 2022, it's a transition year.
We currently have no more questions on the line. There are no more questions on the line.
Thank you. Thank you very much, and see you. We are available for your question, and the IR team is here to answer all your questions. Thank you very much. Bye-bye.
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