Sangster’s new operators aim to increase passenger traffic

The acquisition, which represents the first move outside of Mexico for the group, was aided by GAP’s connection to the island via its current Chief Executive Officer (CEO) Fernando Bosque Mohino, formerly the CEO of MBJ Airports prior to 2011.

“The integration of the Montego Bay Airport represents the following synergies [including] a concession regimen similar to GAP’s; contribution of traffic, aeronautical services and commercial revenues; contribution of value to consolidated earnings before interest depreciation and amortisation (EBITDA); and passenger and airline profiles similar to that of Los Cabos and Vallarta,” stated GAP in a press release.

GAP, which runs 12 airports in Mexico, revealed that based on the acquisition it expects group traffic to grow between 18 and 20 per cent, and EBITDA to grow between 22 and 25 per cent this year.

The deal involved GAP buying DCA Airport assets from Spanish operator Abertis this month. The assets included a 75 per cent stake in MBJ Airports in Jamaica and a 14 per cent stake in SCL Terminal Aéreo Santiago, an airport in Chile. GAP expects the bulk of the returns to come from Jamaica as the concession with Chile ends in September 2015, while that with Jamaica ends in 2033.

“In our opinion, the DCA acquisition contributes significant value for GAP as it adds one more airport to the company, thereby geographically diversifying its portfolio of airports, as well as strengthening its passenger traffic, revenues, EBITDA and shareholder value,” added the press release.

Sangster International Airport, located in Montego Bay, connects tourists to the resort towns Ocho Rios and Negril on Jamaica’s north coast. During 2014, the airport served a total of 3.6 million terminal passengers. American Airlines was the main carrier with 23 per cent of the total passenger traffic, followed by Delta with 13 per cent, Airtran with 9.0 per cent and JetBlue with 8.0 per cent. Other airlines that operate in this airport include Caribbean Airlines, Air Canada, Allegiant Air, Frontier Airlines, British Airways, Spirit Airlines, Sun Country, Sunwing and WestJet, among others.

In 2014, MBJ Airports made net income of US$13.2 million from total revenues of US$59 million. Aeronautical revenues, the core of the business, accounted for 46.3 per cent of total revenues. Operating costs for 2014 were US$35.5 million with EBITDA at US$23.5 million representing a margin of 39.8 per cent, stated GAP on the local airport.

“GAP financed 100 per cent of the acquisition via bridge loans with external resources provided by Scotiabank Inverlat and BBVA Bancomer, which will be substituted with short and long-term loans,” stated the GAP release.

At December 31, 2014, MBJ had net debt in the amount of US$60.5 million, of which US$44.9 million corresponded to long-term loans from shareholders.

 

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