UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 20-F


☐	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, ~~2018~~2019

Commission file number: 1-33168

Grupo Aeroportuario del Centro Norte, S.A.B. de C.V.

(Exact name of Registrant as specified in its charter)

Central North Airport Group

(Translation of Registrant’s name into English)

United Mexican States

(Jurisdiction of incorporation or organization)

~~Torre Latitud, L501,~~Plaza Metrópoli Patriotismo, Piso 5

Av. ~~Lázaro Cárdenas 2225~~Patriotismo 201

Col. ~~Valle Oriente,~~ San Pedro ~~Garza García~~de los Pinos, Benito Juárez

~~Nuevo León, Mexico~~Ciudad de México, México

(Address of principal executive offices)

Ruffo Pérez Pliego del Castillo

~~Torre Latitud, L501,~~Plaza Metrópoli Patriotismo, Piso 5

Av. ~~Lázaro Cárdenas 2225~~Patriotismo 201

Col. ~~Valle Oriente,~~ San Pedro ~~Garza García~~de los Pinos, Benito Juárez

~~Nuevo León, Mexico~~Ciudad de México, México

+ 52 81 8625 4300

rperezpliego@oma.aero

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:


Title of each class:	Trading Symbol(s)	Name of each exchange on which registered
American Depositary Shares (ADSs) each representing 8 Series B shares	OMAB	The NASDAQ Stock Market LLC
Series B shares	OMAB	The NASDAQ Stock Market LLC*

*Not for trading, but only in connection with the registration of ADSs, pursuant to the requirements of the Securities and Exchange Commission.

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

N/A

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:


Title of each class:		Number of Shares
Series B shares		~~343,680,466~~341,534,815 (excluding ~~324,507~~2,470,158 treasury shares)
Series BB shares		49,766,000

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☒ Yes ☐ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Sections 13 or 15(d) of the Securities Exchange Act of 1934.

☐ Yes ☒ No

Note — Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☐ Yes ☒ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☐		Accelerated filer ☒		Non-accelerated filer ☐		Emerging growth company ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:


U.S. GAAP ☐		IFRS ☒		Other ☐

Indicate by check mark which financial statement item the registrant has elected to follow:

☐ Item 17 ☒ Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (§ 15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

☒ Yes ☐ No

Table of Contents

TABLE OF CONTENTS


		Page

ITEM 1.	IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	1

ITEM 2.	OFFER STATISTICS AND EXPECTED TIMETABLE	1

ITEM 3.	KEY INFORMATION	1
	Selected Financial Data	1
	Risk Factors	9
	Forward-Looking Statements	3334

ITEM 4.	INFORMATION ON THE COMPANY	3435
	History And Development Of The Company	3435
	Business Overview	3940
	Regulatory Framework	7071
	Organizational Structure	8788
	Property, Plant And Equipment	8990

ITEM 4A.	UNRESOLVED STAFF COMMENTS	8990

ITEM 5.	OPERATING AND FINANCIAL REVIEW AND PROSPECTS	8990

ITEM 6.	DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES	~~130~~125

ITEM 7.	MAJOR SHAREHOLDERS AND RELATED-PARTY TRANSACTIONS	~~139~~134
	Major Shareholders	~~139~~134
	Related-Party Transactions	~~141~~136

ITEM 8.	FINANCIAL INFORMATION	~~142~~138
	Legal Proceedings	~~143~~138
	Dividends And Capital Stock Reimbursements	~~144~~140

ITEM 9.	THE OFFER AND LISTING	~~146~~141
	Share Price History	~~146~~141
	Trading On The Mexican Stock Exchange	~~146~~141

ITEM 10.	ADDITIONAL INFORMATION BYLAWS	~~146~~142
	Material Contracts	~~162~~157
	Exchange Controls	~~162~~157
	Taxation	~~162~~157
	Documents On Display	~~166~~161

Table of Contents

ITEM 11.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	~~167~~162

ITEM 12.	DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES	~~167~~162

ITEM 12A.	DEBT SECURITIES	~~167~~162

ITEM 12B.	WARRANTS AND RIGHTS	~~167~~162

ITEM 12C.	OTHER SECURITIES	~~167~~162

ITEM 12D.	AMERICAN DEPOSITARY SHARES	~~167~~162

ITEM 13.	DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES	~~169~~164

ITEM 14.	MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS	~~169~~164

ITEM 15.	CONTROLS AND PROCEDURES	~~169~~164

ITEM 16.	[RESERVED]	~~172~~167

ITEM 16A.	AUDIT COMMITTEE’S FINANCIAL EXPERT	~~172~~167

ITEM 16B.	CODE OF ETHICS	~~172~~167

ITEM 16C.	PRINCIPAL ACCOUNTANT FEES AND SERVICES AUDIT AND NON-AUDIT FEES	~~172~~168

ITEM 16D.	EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES	~~173~~168

ITEM 16E.	PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS	~~173~~168

ITEM 16F.	CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT	~~173~~169

ITEM 16G.	CORPORATE GOVERNANCE	~~174~~169

ITEM 16H.	MINE SAFETY DISCLOSURES	~~178~~174

ITEM 17.	FINANCIAL STATEMENTS	~~179~~175

ITEM 18.	FINANCIAL STATEMENTS	~~179~~175

ITEM 19.	EXHIBITS	~~179~~175

Table of Contents

PART I

Item 1. Identity of Directors, Senior Management and Advisers

Not applicable.

Item 2. Offer Statistics and Expected Timetable

Not applicable.

Item 3. Key Information

Selected Financial Data

Our consolidated financial statements included in this annual report are prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or the IASB. We publish our consolidated financial statements in thousands of Mexican pesos.

References in this annual report on Form 20‑F to “dollars,” “U.S. dollars” or “U.S.$” are to the lawful currency of the United States. References in this annual report on Form 20‑F to “pesos” or “Ps.” are to the lawful currency of Mexico. This Form 20‑F contains translations of certain peso amounts into U.S. dollars at specified rates solely for the convenience of the reader. These translations should not be construed as representations that the peso amounts actually represent such U.S. dollar amounts or could be converted into U.S. dollars at the rate indicated. Unless otherwise indicated, U.S. dollar amounts have been translated from Mexican pesos at an exchange rate of ~~Ps.19.6566~~ Ps.18.8727 to U.S.$1.00, the ~~FIX~~ exchange rate as reported by the Mexican Central Bank (Banco de México) on December 31, ~~2018.~~2019.

This annual report on Form 20‑F contains references to “workload units,” which are units measuring an airport’s passenger traffic volume and cargo volume. A workload unit currently is equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo.

The discussion in this annual report of aeronautical and non‑aeronautical revenues in relation to our total revenues is not in accordance with IFRS because it excludes our construction revenues from such amounts. Therefore, in reviewing this annual report, you should be aware that in several sections of this annual report we take into account only revenues that resulted in actual cash inflows for the year (which we categorize as aeronautical and non‑aeronautical revenues) for ratios or comparative calculations. Both of these categories of revenues are dependent, either directly or indirectly, on passenger traffic, while revenues from construction services under IFRS Interpretations Committee (“IFRIC”) 12, “Service Concession Arrangements,” are not dependent upon passenger traffic, but from the level of capital expenditures carried out at each airport. Information reported using only revenues that generated cash inflows may be more useful for readers of this annual report because those revenues are driven by the key elements of our business: passenger traffic and our maximum tariffs. The use of aeronautical and non‑aeronautical revenues is more common in our industry, as they represent the revenues generated from our core operations, which are services provided to passengers, airlines and other third parties based on passenger traffic at our airports. Additionally, management regularly reviews our aeronautical and non‑aeronautical revenues as they provide representative information regarding our passenger traffic and cash flows, which allows us to compare such revenues over comparative periods as well as make projections about our expected future cash flows. Finally, management reviews non‑aeronautical revenues per terminal passenger excluding hotel and industrial park services because hotel and industrial park services are not necessarily driven by passenger traffic and therefore may not provide representative information with respect to passenger traffic. This metric is not considered to be an IFRS metric, given its exclusion of certain revenues. We indicate each instance in which we use only aeronautical and non‑aeronautical revenues and non‑aeronautical revenues excluding hotel services by indicating the category of revenues used.

Table of Contents

The following tables present a reconciliation of our aeronautical and non-aeronautical revenues to our total revenues per our consolidated statement of income and other comprehensive income:


	For the Year Ended December 31, 2018													For the Year Ended December 31, 2019
							Total															Total
							Aeronautical and															Aeronautical and
					Total		Non-Aeronautical												Total			Non-Aeronautical
			Non-		Aeronautical and		Revenues as a									Non-			Aeronautical and			Revenues as a
	Aeronautical		Aeronautical		Non-Aeronautical		Percentage of		Construction		Total			Aeronautical		Aeronautical			Non-Aeronautical			Percentage of			Construction			Total
	Revenues		Revenues		Revenues		Total Revenues		Revenues		Revenues			Revenues		Revenues			Revenues			Total Revenues			Revenues			Revenues
	(in thousands of pesos)													(in thousands of pesos)
Metropolitan													Metropolitan
Monterrey	Ps.	2,447,993	Ps.	649,393	Ps.	3,097,386	93.0	%	Ps.	232,698	Ps.	3,330,084	Monterrey	Ps.	2,641,052		Ps.	726,685		Ps.	3,367,737		91.2	%		Ps.	323,035		Ps.	3,690,772
Tourist													Tourist
Acapulco		182,663		34,279		216,942	43.7	%		279,099		496,041	Acapulco		227,954			40,241			268,195		81.0	%			63,102			331,297
Mazatlán		276,126		46,754		322,880	91.2	%		31,308		354,188	Mazatlán		321,313			52,857			374,170		91.5	%			34,573			408,743
Zihuatanejo		167,578		22,934		190,512	93.4	%		13,534		204,046	Zihuatanejo		191,512			25,596			217,108		90.5	%			22,876			239,984
Regional													Regional
Chihuahua		364,755		56,128		420,883	74.8	%		141,546		562,429	Chihuahua		411,393			67,021			478,414		79.3	%			124,701			603,115
Culiacán		539,540		57,313		596,853	94.6	%		33,888		630,741	Culiacán		617,979			66,286			684,265		90.8	%			68,960			753,225
Durango		112,310		10,822		123,132	89.9	%		13,788		136,920	Durango		150,130			13,433			163,563		81.7	%			36,677			200,240
San Luis Potosí		167,030		30,275		197,305	46.0	%		231,726		429,031	San Luis Potosí		174,340			35,631			209,971		65.5	%			110,743			320,714
Tampico		190,502		26,891		217,393	89.3	%		26,169		243,562	Tampico		197,160			28,057			225,217		78.5	%			61,823			287,040
Torreón		184,396		22,655		207,051	91.2	%		19,990		227,041	Torreón		201,446			23,683			225,129		92.5	%			18,343			243,472
Zacatecas		105,626		11,935		117,561	92.4	%		9,655		127,216	Zacatecas		141,500			13,945			155,445		95.8	%			6,842			162,287
Border													Border
Ciudad Juárez		310,892		45,287		356,179	97.5	%		9,096		365,275	Ciudad Juárez		380,271			55,990			436,261		96.1	%			17,650			453,911
Reynosa		106,867		14,810		121,677	45.7	%		144,830		266,507	Reynosa		113,515			18,240			131,755		54.0	%			112,031			243,786
Terminal 2 NH Collection Hotel		—		246,065		246,065	100.0	%		—		246,065	Terminal 2 NH Collection Hotel		—			255,393			255,393		100.0	%			—			255,393
Hilton Garden Inn Hotel		—		100,051		100,051	100.0	%		—		100,051	Hilton Garden Inn Hotel		—			103,474			103,474		100.0	%			—			103,474
OMA Vynmsa Aero Industrial Park		—		28,190		28,190	100.0	%		—		28,190	OMA Vynmsa Aero Industrial Park		—			41,981			41,981		100.0	%			—			41,981
Other(1)		—		4,433,390		4,433,390	100.0	%		—		4,433,390	Other(1)		—			5,651,607			5,651,607		100.0	%			—			5,651,607
Total		5,156,278		5,837,172		10,993,450	90.3	%		1,187,327		12,180,777	Total		5,769,565			7,220,120			12,989,685		92.8	%			1,001,356			13,991,041
Eliminations(2)		(16,226)		(4,211,675)		(4,227,901)	N/A	%		(45,822)		(4,273,723)	Eliminations(2)		(16,903)			(5,400,515)			(5,417,418)		N/A	%			(46,522)			(5,463,940)
Total Revenues	Ps.	5,140,052	Ps.	1,625,497	Ps.	6,765,549	85.6	%	Ps.	1,141,505	Ps.	7,907,054	Total Revenues	Ps.	5,752,662		Ps.	1,819,605		Ps.	7,572,267		88.8	%		Ps.	954,834		Ps.	8,527,101

(1)

Represents our subsidiaries Servicios Aeroportuarios del Centro Norte, S.A. de C.V., Operadora de Aeropuertos del Centro Norte, S.A. de C.V., Servicios Aero Especializados del Centro Norte, S.A. de C.V., OMA Logística, S.A. de C.V., Holding Consorcio Grupo Hotelero T2, S.A. de C.V. and Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (on an individual basis).

(2)

Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.

Table of Contents


	For the Year Ended December 31, 2018
								Total
								Aeronautical and
					Total			Non-Aeronautical
			Non-		Aeronautical and			Revenues as a
	Aeronautical		Aeronautical		Non-Aeronautical			Percentage of			Construction			Total
	Revenues		Revenues		Revenues			Total Revenues			Revenues			Revenues
	(in thousands of pesos)
Metropolitan
Monterrey	Ps.	2,447,993	Ps.	649,393		Ps.	3,097,386		93.0	%		Ps.	232,698		Ps.	3,330,084
Tourist
Acapulco		182,663		34,279			216,942		43.7	%			279,099			496,041
Mazatlán		276,126		46,754			322,880		91.2	%			31,308			354,188
Zihuatanejo		167,578		22,934			190,512		93.4	%			13,534			204,046
Regional
Chihuahua		364,755		56,128			420,883		74.8	%			141,546			562,429
Culiacán		539,540		57,313			596,853		94.6	%			33,888			630,741
Durango		112,310		10,822			123,132		89.9	%			13,788			136,920
San Luis Potosí		167,030		30,275			197,305		46.0	%			231,726			429,031
Tampico		190,502		26,891			217,393		89.3	%			26,169			243,562
Torreón		184,396		22,655			207,051		91.2	%			19,990			227,041
Zacatecas		105,626		11,935			117,561		92.4	%			9,655			127,216
Border
Ciudad Juárez		310,892		45,287			356,179		97.5	%			9,096			365,275
Reynosa		106,867		14,810			121,677		45.7	%			144,830			266,507
Terminal 2 NH Collection Hotel		—		246,065			246,065		100.0	%			—			246,065
Hilton Garden Inn Hotel		—		100,051			100,051		100.0	%			—			100,051
OMA Vynmsa Aero Industrial Park		—		28,190			28,190		100.0	%			—			28,190
Other(1)		—		4,433,390			4,433,390		100.0	%			—			4,433,390
Total		5,156,278		5,837,172			10,993,450		90.3	%			1,187,327			12,180,777
Eliminations(2)		(16,226)		(4,211,675)			(4,227,901)		N/A				(45,822)			(4,273,723)
Total Revenues	Ps.	5,140,052	Ps.	1,625,497		Ps.	6,765,549		85.6	%		Ps.	1,141,505		Ps.	7,907,054

(1)

(2)

Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.

Table of Contents


	For the Year Ended December 31, 2017
							Total
							Aeronautical and
					Total		Non-Aeronautical
			Non-		Aeronautical and		Revenues as a
	Aeronautical		Aeronautical		Non-Aeronautical		Percentage of		Construction		Total
	Revenues		Revenues		Revenues		Total Revenues		Revenues		Revenues
	(in thousands of pesos)
Metropolitan
Monterrey	Ps.	2,046,097	Ps.	547,586	Ps.	2,593,683	87.6	%	Ps.	367,214	Ps.	2,960,897
Tourist
Acapulco		158,448		34,089		192,537	34.1	%		372,253		564,790
Mazatlán		249,479		47,819		297,298	90.8	%		30,205		327,503
Zihuatanejo		167,550		27,334		194,884	87.4	%		28,039		222,923
Regional
Chihuahua		308,746		52,742		361,488	74.7	%		122,412		483,900
Culiacán		409,399		53,296		462,695	91.4	%		43,362		506,057
Durango		100,884		11,061		111,945	84.9	%		19,974		131,919
San Luis Potosí		149,823		24,603		174,426	61.6	%		108,756		283,182
Tampico		171,550		25,859		197,409	80.9	%		46,740		244,149
Torreón		156,158		22,478		178,636	89.9	%		20,018		198,654
Zacatecas		95,153		12,172		107,325	84.8	%		19,175		126,500
Border
Ciudad Juárez		244,891		40,676		285,567	89.9	%		31,917		317,484
Reynosa		104,311		15,094		119,405	48.4	%		127,353		246,758
Terminal 2 NH Collection Hotel		—		250,777		250,777	100.0	%		—		250,777
Hilton Garden Inn Hotel		—		90,875		90,875	100.0	%		—		90,875
OMA Vynmsa Aero Industrial Park		—		12,914		12,914	100.0	%		—		12,914
Other(1)		—		4,034,440		4,034,440	100.0	%		—		4,034,440
Total		4,362,489		5,303,815		9,666,304	87.8	%		1,337,418		11,003,722
Eliminations(2)		(15,458)		(3,847,477)		(3,862,935)	N/A			(10,960)		(3,873,895)
Total Revenues	Ps.	4,347,031	Ps.	1,456,338	Ps.	5,803,369	81.4	%	Ps.	1,326,458	Ps.	7,129,827

(1)

(2)

Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.

Table of Contents


	For the Year Ended December 31, 2016
							Total
							Aeronautical and
					Total		Non-Aeronautical
			Non-		Aeronautical and		Revenues as a
	Aeronautical		Aeronautical		Non-Aeronautical		Percentage of		Construction		Total
	Revenues		Revenues		Revenues		Total Revenues		Revenues		Revenues
	(in thousands of pesos)
Metropolitan
Monterrey	Ps.	1,799,823	Ps.	560,016	Ps.	2,359,839	96.0	%	Ps.	97,631	Ps.	2,457,470
Tourist
Acapulco		149,214		30,446		179,660	70.1	%		76,772		256,432
Mazatlán		221,522		46,879		268,401	93.2	%		19,527		287,928
Zihuatanejo		141,091		26,280		167,371	86.7	%		25,699		193,070
Regional
Chihuahua		272,921		48,374		321,295	95.2	%		16,061		337,356
Culiacán		351,096		48,280		399,376	97.7	%		9,608		408,984
Durango		98,550		11,026		109,576	96.2	%		4,381		113,957
San Luis Potosí		130,337		23,666		154,003	86.3	%		24,456		178,459
Tampico		162,389		22,735		185,124	85.2	%		32,053		217,177
Torreón		151,251		20,087		171,338	96.8	%		5,722		177,060
Zacatecas		87,616		10,120		97,736	92.7	%		7,677		105,413
Border
Ciudad Juárez		208,042		34,351		242,393	96.1	%		9,905		252,298
Reynosa		113,506		14,150		127,656	84.3	%		23,847		151,503
Terminal 2 NH Collection Hotel		—		227,884		227,884	100.0	%		—		227,884
Hilton Garden Inn Hotel		—		83,625		83,625	100.0	%		—		83,625
OMA Vynmsa Aero Industrial Park		—		4,952		4,952	100.0	%		—		4,952
Other(1)		—		4,847,425		4,847,425	100.0	%		—		4,847,425
Total		3,887,358		6,060,296		9,947,654	96.6	%		353,339		10,300,993
Eliminations(2)		(14,623)		(4,727,534)		(4,742,157)	N/A			(8,567)		(4,750,724)
Total Revenues	Ps.	3,872,735	Ps.	1,332,762	Ps.	5,205,497	93.8	%	Ps.	344,772	Ps.	5,550,269

(1)

(2)

Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.

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	For the Year Ended December 31, 2015
							Total
							Aeronautical and
					Total		Non-Aeronautical
			Non-		Aeronautical and		Revenues as a
	Aeronautical		Aeronautical		Non-Aeronautical		Percentage of		Construction		Total
	Revenues		Revenues		Revenues		Total Revenues		Revenues		Revenues
	(in thousands of pesos)
Metropolitan
Monterrey	Ps.	1,443,311	Ps.	484,111	Ps.	1,927,422	96.4	%	Ps.	70,999	Ps.	1,998,421
Tourist
Acapulco		138,309		27,864		166,173	67.0	%		81,869		248,042
Mazatlán		168,703		40,820		209,523	83.5	%		41,487		251,010
Zihuatanejo		118,736		23,751		142,487	71.1	%		57,943		200,430
Regional
Chihuahua		196,033		40,204		236,237	98.4	%		3,769		240,006
Culiacán		255,921		39,981		295,902	89.7	%		34,058		329,960
Durango		63,186		9,080		72,266	96.0	%		2,992		75,258
San Luis Potosí		99,341		20,482		119,823	96.3	%		4,668		124,491
Tampico		144,178		22,810		166,988	94.6	%		9,589		176,577
Torreón		110,480		18,191		128,671	89.7	%		14,796		143,467
Zacatecas		66,957		9,304		76,261	84.9	%		10,294		86,555
Border
Ciudad Juárez		146,201		29,225		175,426	94.9	%		9,512		184,938
Reynosa		95,742		12,557		108,299	94.7	%		6,012		114,311
Terminal 2 NH Collection Hotel		—		212,488		212,488	100.0	%		—		212,488
Hilton Garden Inn Hotel		—		16,882		16,882	100.0	%		—		16,882
Other(1)		—		3,639,434		3,639,434	100.0	%		—		3,639,434
Total		3,047,098		4,647,184		7,694,282	95.7	%		347,988		8,042,270
Eliminations(2)		(13,968)		(3,535,643)		(3,549,611)	N/A			—		(3,549,611)
Total Revenues	Ps.	3,033,130	Ps.	1,111,541	Ps.	4,144,671	92.3	%	Ps.	347,988	Ps.	4,492,659

(1)

(2)

Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.

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For the Year Ended December 31, 2014








Total




Aeronautical and

Total

Non-Aeronautical

Non-

Aeronautical and

Revenues as a

Aeronautical

Aeronautical

Non-Aeronautical

Percentage of

Construction

Total

Revenues

Revenues

Revenues

Total Revenues

Revenues

Revenues

(in thousands of pesos)
Metropolitan












Monterrey

Ps.
1,167,807

Ps.
360,228

Ps.
1,528,035

97.7
%
Ps.
36,618

Ps.
1,564,653
Tourist








Acapulco

117,573

22,779

140,352

74.4
%

48,313

188,665
Mazatlán

148,781

37,002

185,783

73.6
%

66,475

252,258
Zihuatanejo

102,780

19,990

122,770

89.4
%

14,504

137,274
Regional








Chihuahua

162,469

34,792

197,261

92.6
%

15,719

212,980
Culiacán

223,423

35,022

258,445

88.3
%

34,097

292,542
Durango

48,937

7,784

56,721

80.7
%

13,598

70,319
San Luis Potosí

84,498

17,508

102,006

87.4
%

14,772

116,778
Tampico

124,312

18,183

142,495

91.7
%

12,981

155,476
Torreón

98,985

15,671

114,656

90.2
%

12,444

127,100
Zacatecas

56,872

7,535

64,407

82.1
%

14,036

78,443
Border








Ciudad Juárez

124,252

24,784

149,036

91.5
%

13,782

162,818
Reynosa

85,018

10,988

96,006

90.6
%

9,988

105,994
Terminal 2 NH Collection Hotel

—

195,742

195,742

100.0
%

—

195,742
Other(1)

—

2,441,636

2,441,636

100.0
%

—

2,441,636
Total

2,545,707

3,249,644

5,795,351

95.0
%

307,327

6,102,678
Eliminations(2)

(13,041)

(2,359,950)

(2,372,991)

N/A

—

(2,372,991)
Total Revenues

Ps.
2,532,666

Ps.
889,694

Ps.
3,422,360

91.8
%
Ps.
307,327

Ps.
3,729,687

~~(1)~~

~~(2)~~

~~Eliminations consist of operations and balances between our subsidiaries, as well as reclassifications.~~

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The following tables present our selected consolidated financial information for or as of each of the periods or dates indicated, and have been derived in part from our audited consolidated financial statements. This information should be read in conjunction with, and is qualified in its entirety by reference to, our consolidated financial statements, including the notes to our consolidated financial statements.


	For the Year Ended December 31,						For the Year Ended December 31,
	2014	2015	2016	2017	2018		2015	2016	2017	2018	2019
	(in thousands of pesos, except per share and operating data)					(in thousands of dollars)(1)	(in thousands of pesos, except per share and operating data)				(in thousands of dollars)(1)
Statements of Income and Other Comprehensive Income data:
Revenues:
Aeronautical services(2)	2,532,666	3,033,130	3,872,735	4,347,031	5,140,052	261,492	3,033,130	3,872,735	4,347,031	5,140,052	5,752,662	304,814
Non-aeronautical services(3)	889,694	1,111,541	1,332,762	1,456,338	1,625,497	82,695	1,111,541	1,332,762	1,456,338	1,625,497	1,819,605	96,415
Construction services	307,327	347,988	344,772	1,326,458	1,141,505	58,072	347,988	344,772	1,326,458	1,141,505	954,834	50,593
Total revenues	3,729,687	4,492,659	5,550,269	7,129,827	7,907,054	402,259	4,492,659	5,550,269	7,129,827	7,907,054	8,527,101	451,822
Operating costs and expenses:
Costs of services, excluding depreciation and amortization	772,946	836,133	900,141	981,065	977,896	49,749	836,133	900,141	981,065	977,896	954,207	50,560
Major maintenance provision	179,932	174,293	262,871	291,038	248,636	12,649	174,293	262,871	291,038	248,636	292,324	15,489
Cost of construction	307,327	347,988	344,772	1,326,458	1,141,505	58,072	347,988	344,772	1,326,458	1,141,505	954,834	50,593
Administrative expenses	539,753	558,222	642,345	587,917	563,151	28,649	558,222	642,345	587,917	563,151	542,664	28,754
Right to use airport facilities(4)	171,670	209,771	244,215	271,331	319,180	16,238	209,771	244,215	271,331	319,180	363,561	19,264
Technical assistance fees(5)	82,461	97,818	117,987	135,074	172,610	8,781	97,818	117,987	135,074	172,610	150,108	7,954
Depreciation and amortization(6)	223,982	238,809	276,634	299,205	351,745	17,894	238,809	276,634	299,205	351,745	415,252	22,003
Other income, net	(17,373)	(6,930)	(22,250)	(1,380)	(205)	(10)	(6,930)	(22,250)	(1,380)	(205)	(1,155)	(61)
Total operating costs and expenses	2,260,698	2,456,104	2,766,715	3,890,708	3,774,518	192,022	2,456,104	2,766,715	3,890,708	3,774,518	3,671,795	194,556
Operating income	1,468,989	2,036,555	2,783,554	3,239,119	4,132,536	210,237	2,036,555	2,783,554	3,239,119	4,132,536	4,855,306	257,266
Interest expense	(264,368)	(334,764)	(330,694)	(352,822)	(325,557)	(16,562)	(334,764)	(330,694)	(352,822)	(325,557)	(376,008)	(19,923)
Interest income	77,147	80,740	199,600	127,290	194,091	9,874	80,740	199,600	127,290	194,091	171,236	9,073
Exchange loss, net	(22,463)	(33,784)	(29,177)	(63,072)	(15,488)	(788)
Exchange (loss) gain, net							(33,784)	(29,177)	(63,072)	(15,488)	(50,878)	(2,696)
Income before income taxes	1,259,305	1,748,747	2,623,283	2,950,515	3,985,582	202,761	1,748,747	2,623,283	2,950,515	3,985,582	4,599,656	243,720
Income tax expense	232,345	512,110	746,782	813,073	1,121,403	57,050
Income tax (benefit) expense							512,110	746,782	813,073	1,121,403	1,372,222	72,709
Consolidated net income for the year	1,026,960	1,236,637	1,876,501	2,137,442	2,864,179	145,711	1,236,637	1,876,501	2,137,442	2,864,179	3,227,434	171,011
Items that will not be subsequently reclassified to income:
Actuarial losses on labor obligations	437	(1,286)	3,533	(4,199)	24,173	1,230	(1,286)	3,533	(4,199)	24,173	(12,834)	(680)
Income tax relating to items that will not be subsequently reclassified to profit or loss	(131)	386	(1,060)	1,260	(4)	(0)	386	(1,060)	1,260	(4)	3,850	204
Total comprehensive income for the year	1,027,266	1,235,737	1,878,974	2,134,503	2,888,348	146,941	1,235,737	1,878,974	2,134,503	2,888,348	3,218,450	170,535
Consolidated net income attributable to:
Controlling interest	1,024,694	1,233,772	1,870,187	2,127,576	2,851,822	145,082	1,233,772	1,870,187	2,127,576	2,851,822	3,219,798	170,606
Non-controlling interest	2,266	2,865	6,314	9,866	12,357	629	2,865	6,314	9,866	12,357	7,636	405
Consolidated comprehensive income attributable to:				��
Controlling interest	1,025,000	1,232,872	1,872,660	2,124,637	2,875,991	146,312	1,232,872	1,872,660	2,124,637	2,875,991	3,210,814	170,130
Non-controlling interest	2,266	2,865	6,314	9,866	12,357	629	2,865	6,314	9,866	12,357	7,636	405
Basic and diluted earnings per share of controlling interest(7)	2.5844	3.1328	4.7614	5.4046	7.2483	0.3687	3.1328	4.7614	5.4046	7.2483	8.1984	0.4344
Basic and diluted earnings per ADS(7)	20.6752	25.0623	38.0912	43.2368	57.9864	2.9500	25.0623	38.0912	43.2368	57.9864	65.5872	3.4752
Dividend or reimbursement of capital per share(8)	3.0000	3.0000	3.5000	4.0000	4.0633	0.2067	3.0000	3.5000	4.0000	4.0633	4.0633	0.2153
Other operating data:
Total terminal passengers (thousands of passengers)(9)	14,695	16,922	18,764	19,662	21,566	N/A	16,922	18,764	19,662	21,566	23,168	N/A
Total air traffic movements (thousands of movements)	337	345	358	332	345	N/A	345	358	332	345	340	N/A
Aeronautical and non-aeronautical revenues per terminal passenger(10)	233	245	277	295	314	16	245	277	295	314	327	17

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	As of December 31,						As of December 31,
	2014	2015	2016	2017	2018		2015	2016	2017	2018	2019
	(in thousands of pesos)					(in thousands of dollars)(1)	(in thousands of pesos)					(in thousands of dollars)(1)
Statement of Financial Position data:
Cash and cash equivalents	2,808,149	2,605,196	3,005,792	2,333,007	2,958,902	150,530	2,605,196	3,005,792	2,333,007	2,958,902	3,429,873	181,737
Other investments held to maturity	—	60,445	—	49,338	19,657	1,000	60,445	—	49,338	19,657	—	—
Total current assets	3,404,343	3,216,774	4,098,459	3,498,622	3,959,567	201,437	3,216,774	4,098,459	3,498,622	3,959,567	4,810,904	254,913
Property, leasehold improvements and equipment, net	2,284,314	2,370,975	2,444,205	2,601,397	2,670,262	135,845	2,370,975	2,444,205	2,601,397	2,670,262	2,647,101	140,261
Investment in airport concessions	6,180,277	6,348,605	6,513,514	7,648,417	8,566,656	435,816	6,348,605	6,513,514	7,648,417	8,566,656	9,267,111	491,033
Total assets	12,417,880	12,510,336	13,545,323	14,200,800	15,590,484	793,142	12,510,336	13,545,323	14,200,800	15,590,484	17,276,961	915,447
Current liabilities	830,680	968,782	1,108,331	1,104,273	1,224,716	62,306	968,782	1,108,331	1,104,273	1,224,716	1,235,293	65,454
Total liabilities	6,301,277	6,559,809	6,858,343	6,971,485	7,078,557	360,111	6,559,809	6,858,343	6,971,485	7,078,557	7,389,466	391,543
Capital stock	1,491,023	302,398	303,644	303,394	303,394	15,435	302,398	303,644	303,394	303,394	301,739	15,988
Total shareholders’ equity	6,116,603	5,950,527	6,686,980	7,229,315	8,511,927	433,031	5,950,527	6,686,980	7,229,315	8,511,927	9,887,495	523,905


	For the Year Ended December 31,						For the Year Ended December 31,
	2014	2015	2016	2017	2018		2015	2016	2017	2018	2019
	(in thousands of pesos)					(in thousands of dollars)(1)	(in thousands of pesos)					(in thousands of dollars)(1)
Statement of Cash Flows data:
Net cash flows from operating activities	1,610,772	2,069,331	2,386,146	2,921,333	3,709,346	188,707	2,069,331	2,386,146	2,921,333	3,709,346	3,716,524	196,926
Net cash flows used in investing activities	(371,844)	(493,235)	(471,357)	(1,542,776)	(1,088,373)	(55,369)	(493,235)	(471,357)	(1,542,776)	(1,088,373)	(952,227)	(50,455)
Net cash flows (used in) from financing activities	35,215	(1,779,049)	(1,514,193)	(1,979,135)	(1,940,463)	(98,718)	(1,779,049)	(1,514,193)	(1,979,135)	(1,940,463)	(2,246,461)	(119,032)
Increase (decrease) in cash and cash equivalents	1,274,143	(202,953)	400,596	(600,578)	680,510	34,620	(202,953)	400,596	(600,578)	680,510	517,836	27,438
Effects of exchange rate changes on the foreign currency cash balance	—	—	—	(72,207)	(54,615)	(2,778)	—	—	(72,207)	(54,615)	(46,865)	(2,483)

(1) Translated into dollars at the rate of ~~Ps.19.6566~~ Ps.18.8727 per U.S.$1.00, the ~~FIX~~ exchange rate as reported by the Mexican Central Bank on December 31, ~~2018.~~2019. Per share dollar amounts are expressed in dollars (not thousands of dollars). Operating data is expressed in units indicated.

(2) Revenues from aeronautical services principally consist of a fee for each departing passenger, aircraft landing fees based on the aircraft’s weight and arrival time, an aircraft parking fee, passenger boarding bridge and airport bus charges, a security charge for each departing passenger and other sources of revenues subject to regulation under our maximum rates.

(3) Revenues from non‑aeronautical services represent sources of revenues not subject to regulation under our maximum rates and consist of: (i) revenues from commercial activities, such as, car parking charges, advertising, leasing of commercial space to tenants, food and beverage services, car rentals and retail; (ii) revenues from diversification activities, such as hotel services, revenues from OMA Carga and real estate services; and (iii) revenues from complementary activities, such as revenues from our checked baggage‑screening services, among other sources of revenues. Pursuant to our concessions and to the Mexican Airport Law (Ley de Aeropuertos) and the regulations thereunder, parking services are currently excluded from aeronautical services under our maximum rates, although the Mexican Ministry of Communications and Transportation (Secretaría de Comunicaciones y Transportes) could decide to regulate such rates, and such rates may be regulated by other authorities.

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(4) Each of our subsidiary concession holders is required to pay a concession tax to the Mexican government under the Mexican Federal Duties Law (Ley Federal de Derechos) for the use of public domain assets pursuant to the terms of its concession. The concession tax is currently equal to 5% of each concession holder’s gross annual revenues.

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(5) We pay Servicios de Tecnología Aeroportuaria, S.A. de C.V. (“SETA”) a technical assistance fee under the technical assistance agreement entered into with SETA providing for management and consulting services (the “Technical Assistance Agreement”), entered into in connection with SETA’s purchase of its Series BB shares. This fee is described in “Item 7. Major Shareholders and Related‑Party Transactions—Related‑Party Transactions—Arrangements with SETA.”

(6) Reflects depreciation of fixed assets and amortization of airport concessions and rights to use airport facilities.

(7) Based on net income attributable to controlling interest for each year and ~~on 396,493,090 weighted average common shares in 2014,~~ 393,826,266 weighted average common shares in 2015, 392,784,322 weighted average common shares in 2016, 393,660,889 weighted average common shares in 2017, ~~and~~ 393,446,466 weighted average common shares in ~~2018.~~2018 and 392,736,827 weighted average common shares in 2019. Earnings per ADS are based on the ratio of eight Series B shares per ADS.

(8) Declared dividends per share for the period from ~~2014~~2015 to 2017 based on 400,000,000 shares, and in 2018 and 2019 based on 393,770,973. Includes reimbursements of capital per share.

(9) Arriving and departing passengers as well as transfer passengers (passengers who arrive at our airports on one aircraft and depart on a different aircraft). Excludes transit passengers (passengers who arrive at our airports but generally depart without changing aircraft).

(10) Aeronautical plus non‑aeronautical revenues divided by terminal passengers for the period. Expressed in pesos (not thousands of pesos).

RISK FACTORS

Risks Related to Our Operations

The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.

The novel strain of coronavirus (“COVID-19”), first identified in Wuhan, China in December 2019, has now spread to nearly all regions around the world. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic. The outbreak, and measures taken to contain or mitigate it, have had dramatic adverse consequences for the global economy, including on demand, operations, supply chains and financial markets. COVID-19 has led to travel restrictions imposed by governments, flight cancellations, and a marked decline in passenger demand for air travel, domestically and worldwide. On March 19, 2020, the United States issued a travel advisory recommending that travelers avoid all international travel. The following day, on March 20, 2020, the United States closed its border with Mexico, except to essential travel and trade and commerce. On March 31, 2020, Mexico’s Ministry of Health issued a decree suspending all non-essential activities in the country through April 30, and on April 21, such suspension was extended through May 30, 2020. The Mexican government has implemented various measures to control the spread of COVID-19, including extraordinary actions, such as school closures and the suspension of non-essential activities, in the regions most affected. For purposes of these measures, airports are considered essential and our airports remain operational.

The reduced demand for travel, domestically and worldwide, will likely result in significant lost revenue. As a result of these restrictions and other conditions beyond our control, our results of operations could be volatile and subject to rapid and unexpected change. The full effect of the travel advisories and restrictions is not yet known and could impact our passenger levels even after formal advisories and restrictions have been lifted. Our total passenger traffic decreased 4.9% in the first quarter of 2020 compared to the first quarter of 2019, and 92.1% between April 1, 2020 and April 22, 2020 as compared to the same period in 2019. The impact of COVID-19 on our operational and financial performance for 2020 will depend on future developments, including the duration and spread of the outbreak and the impact of COVID-19 on overall demand for air travel going forward, all of which are highly uncertain and cannot be predicted. We expect passenger traffic to increase as travel restrictions are lifted and stay-at-home ordinances are repealed, but, as of the date of this report, we cannot quantify the material adverse effect COVID-19 will have on our results of operations or financial performance for fiscal year 2020.

Historically, a substantial majority of our revenues have been derived from aeronautical services, and our principal source of aeronautical services revenues is passenger charges (Tarifa de Uso de Aeropuerto, TUA). Passenger charges are payable for each passenger (other than diplomats, infants, transfer and transit passengers) departing from the airport terminals we operate, collected by the airlines and paid to us. In 2017, 2018 and 2019, passenger charges represented 52.2%, 56.2% and 58.5%, respectively, of our total revenues and 64.2%, 65.7% and 65.9%, respectively, of the sum of our aeronautical and non aeronautical revenues. Because our revenues are largely dependent on the level of passenger traffic in our airports, any pandemics or outbreaks of health epidemics, such as SARS, Influenza A (H1N1),

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Ebola, Zika, Chikungunya and COVID-19, or other such international events or threats thereof (and any related economic impact of such events) could result in decreased passenger traffic and increased costs to the air travel industry and, as a result, could cause a material adverse effect on our business, results of operations, prospects and financial condition. For more information, see “Our operations could be adversely affected due to changes in the collection of passenger charges.”

Large scale international events, including acts of terrorism, or wars, could have a negative impact on international air travel and our revenues.

Events such as the conflicts in the Middle East and terrorist attacks worldwide have negatively affected in the past the frequency and pattern of air travel worldwide.

The terrorist attacks on the United States on September 11, 2001 had a severe adverse impact on the air travel industry, particularly on U.S. carriers and carriers operating international service to and from the United States. Airline traffic in the United States fell precipitously after the attacks. Our terminal passenger volumes declined 5.8% in 2002 as compared to 2001. Among other consequences, airport operations would be disrupted or suspended during the time necessary to conduct rescue operations, investigate the incident and repair or rebuild damaged or destroyed facilities, and our future insurance premiums would likely increase. In addition, our insurance policies do not cover all losses and liabilities resulting from terrorism. Any future terrorist attacks, whether or not involving aircraft, will likely adversely affect our results of operations and financial condition.

Any general increase of hostilities relating to terrorist organizations, reprisals thereof, further conflict in the Middle East, or other such international events or threats thereof (and any related economic impact of such events) could result in decreased passenger traffic and increased costs to the air travel industry and, as a result, could cause a material adverse effect on our business, results of operations, prospects and financial condition. For more information, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.”

Our revenues are highly dependent on levels of air traffic, which depend on factors beyond our control.

Passenger and cargo traffic volumes and air traffic movements depend on many factors beyond our control, including the COVID-19 pandemic, economic conditions in Mexico, the United States or globally, the political situation in Mexico and elsewhere in the world, the attractiveness of the destinations of our airports relative to that of other competing destinations, fluctuations in fuel prices (which could cause airlines to increase tariffs and have a negative impact on traffic as a result of increased fuel costs), changes in regulatory policies applicable to the aviation industry and an increase or decrease in Mexican airlines’ fleets, among others. For more information on the effect COVID-19 has had on our passenger traffic, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.”

Our revenues are closely linked to both passenger and cargo traffic volumes and to the number of air traffic movements at our airports. These factors directly determine our revenues from aeronautical services and indirectly determine our revenues from non-aeronautical services. Any decreases in passenger and cargo traffic volumes and the number of air traffic movements to or from our airports as a result of these factors could adversely affect our business, results of operations, prospects and financial condition.

Our business could be adversely affected by global political developments, particularly with regard to U.S. policies toward Mexico.

Changes in economic, political and regulatory conditions in the United States or in U.S. laws and policies governing foreign trade and foreign relations could create uncertainty in the international markets and could have a negative impact on the Mexican economy and public finances. This correlation is due, in part, to the high level of economic activity between the two countries generally, including the trade facilitated by the North American Free Trade Agreement (“NAFTA”), as well as physical proximity.

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Following the U.S. elections in November 2016 and the change in the U.S. administration for the four-year period from 2017 to 2020, there is uncertainty regarding future U.S. policies with respect to matters of importance to Mexico and its economy, particularly trade and migration. On October 1, 2018, Mexico announced that it had reached an agreement with Canada and the United States to modernize their free trade relationship and replace NAFTA. The new agreement, which ~~will be~~is known as the United States Mexico Canada Agreement (USMCA), was formally signed on November 30, 2018. ~~As of the date of this filing, it remains subject to analysis and approval~~The USMCA has been ratified by the Mexican Senate, United States Congress and ~~it is also subject to implementation~~by the Parliament of Canada. On April 24, 2020, all required procedures ~~under Canadian~~had been completed by the three countries and ~~U.S. law. There is still uncertainty about whether and when~~therefore the ~~USMCA~~agreement will ~~take effect, and we~~enter into force on July 1, 2020. We cannot predict the impact of the USMCA on particular industries or government policies and the changes to international trade that may result.

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In addition, the U.S. administration is adopting stricter immigration policies and tax reforms that could create tension between the Mexican and U.S. governments or reduce economic activity between Mexico and the United States, thus affecting the travel of passengers between those countries. For more information on travel restrictions related to COVID-19, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.”

Furthermore, in September 2017, the U.S. administration announced its plan to phase out the Deferred Action for Childhood Arrivals program (“DACA”), which allows certain individuals who entered the U.S. as undocumented minors to defer immediate deportation and to be eligible for a work permit. Because the majority of individuals who benefit from this program are from Mexico, terminating the program may affect relations between Mexico and the U.S., as well as transit between the two countries. There is still uncertainty about whether and when DACA will be phased out, and we cannot assess the impact it may have on particular industries or government policies that may result. If new federal immigration legislation is enacted in the U.S., such laws may contain provisions that could make it more difficult for Mexican citizens to travel between Mexico and the United States. Such restrictions could have a material adverse effect on our passenger traffic results. Also, the U.S. passed the Tax Cuts and Jobs Act on December 22, 2017, which, among others, reduces the U.S. corporate income tax rate from 35% to 21%, and implemented new import taxes on certain goods, approved on January 22, 2018. We cannot predict the impact that these measures may have on trade between the U.S. and Mexico or whether foreign direct investment from the U.S. to Mexico will decrease.

The foregoing factors and further policy changes could have an impact on Mexico’s ~~GDP~~gross domestic product (“GDP”) growth, the exchange rate between the U.S. dollar and the Mexican peso, levels of foreign direct investment and portfolio investment in Mexico, interest rates, inflation, and the Mexican economy generally; which in turn, may impact the level of passenger traffic in our airports and adversely affect our financial condition or results of operations.

Our business could be adversely affected by a downturn in the global economy, particularly with regard to the U.S. economy.

The outbreak of COVID-19 has adversely affected the economies and financial markets of many countries, including the United States and Mexico. The extent to which COVID-19 impacts these economies will depend on future developments, which are highly uncertain and cannot be predicted, including the duration and scope of the outbreak and the actions taken to contain or treat the outbreak, within the United States, Mexico and around the world. As a result, it is possible that the United States and/or Mexico will experience a significant economic downturn or even another recession due to the effects of the COVID-19 outbreak.

~~International~~Moreover, international events, such as decreases in oil prices and the slower growth in the Chinese economy, have led to volatility in the international markets and adversely affected the Mexican economy. As a result, Mexico has been forced to cut public expenses, since oil output is one of the main sources of revenue in Mexico. In recent years, however, the U.S. economy has improved, with the GDP increasing at an annualized rate in real terms of ~~1.5% in 2016,~~ 2.3% in 2017, ~~and~~ 3.1% in 2018, and 2.3% in 2019, and our international passenger traffic increasing ~~0.2%~~2.8%, ~~2.8%~~4.4% and ~~4.4%~~7.9%, respectively. ~~The Congressional Budget Office forecasts that~~In its April 2020 World Economic Outlook, the ~~real Mexican gross domestic product (“GDP”)~~International Monetary Fund estimated Mexico’s GDP will ~~grow~~decrease by ~~2.3%~~6.6% in ~~2019.~~2020. In the event of an economic downturn, developing countries, which have largely rebounded from the economic and financial crisis in 2009, would be impacted through trade and financial channels.

Our business is particularly dependent on the condition of the U.S. economy and is particularly influenced by trends in the United States relating to leisure travel, consumer spending and international tourism. For more information

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on U.S. travel restrictions related to COVID-19, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.” According to the Mexican National Institute of Statistics and Geography (Instituto Nacional de Estadística y Geografía), in ~~2018,~~2019, exports from Mexico to the United States represented approximately ~~79.5%~~80.5% of Mexican exports, and ~~38.8%~~36.8% of foreign direct investment in Mexico originated in the United States. According to the U.S. Bureau of Economic Analysis, in ~~2018,~~2019, secondary income received from the United States, which includes government and private transfers, was approximately U.S.$~~17.2~~15.8 billion.

Since the demand for aeronautical services in Mexico is substantially dependent on the performance of the Mexican economy, which is in turn highly dependent on the performance of the U.S. economy, a further downturn in the U.S. economy or a disruption in commercial activities among the U.S. and Mexico could cause a material adverse effect on our results of operations, prospects and financial condition. More generally, further downturns in the global economy and/or in the Mexican economy would also adversely affect our business, results of operations, prospects and financial condition. See also “—Risks Related to Mexico—The Company is significantly dependent upon the volume of air passenger traffic in Mexico, and negative economic developments in Mexico could adversely affect its business and results of operations.”

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Variations in international fuel prices could directly or indirectly adversely affect our business and results of operations.

International fuel prices, which represent a significant cost for airlines, have ~~increased~~experienced significant volatility in recent years. In the past, increased costs were among the factors leading to cancellations of routes, decreases in frequencies of flights and, in some cases, even contributed to filings for bankruptcy by some airlines. Any substantial variation in fuel prices could have an adverse effect on our results of operations and financial condition.

Our business is highly dependent on the operations of Mexico City International Airport.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, approximately ~~48.1%~~45.4%, ~~45.4%~~42.9% and ~~42.9%~~43.0%, respectively, of our domestic passengers flew to or from our airports via Mexico City International ~~Airport.~~ Airport (Aeropuerto Internacional de la Ciudad de México, S.A. de C.V.) As a result, our domestic traffic is highly dependent upon the operations of Mexico City International Airport.

On July 3, 2017, the Mexican Federal Antitrust Commission (Comisión Federal de Competencia Económica, or the “Antitrust Commission”) issued Corrective Measures for the Mexico City International Airport to address the inefficiencies observed at the airport during congested hours, limiting operations between the hours of 7:00 and 22:00. In response, on September 29, 2017, the Ministry of Communications and Transportation announced in the Federal Official Gazette the General Guidelines for the allocation of slots at congested airports (see “Risk Factors⸻The Company cannot predict how the regulations governing the business will be applied.”). The indirect effect of the new regulation in 2017 was a decrease in the number of flights and an increase in the number of flight cancellations to and from Mexico City International Airport and other regional destinations.

To alleviate congestion at the Mexico City International Airport, a new Mexico City international airport was being built and was expected to start operations in 2022. The new Mexican federal administration that took office on December 1, 2018 cancelled the construction of the new Mexico City international airport. There is still uncertainty about what effect, if any, the cancellation of the new Mexico City international airport will have on our operations and passenger traffic results.

In addition, the new Mexican federal administration announced that it would seek to alleviate congestion at the existing airport by (i) converting a military airport approximately 40 kilometers (24.9 miles) outside of Mexico City (the “Santa Lucía Airport”) to a civil airport, ~~and~~which is expected to start operations in 2022, (ii) expanding the Toluca International Airport, which is approximately 60 kilometers (37.3 miles) outside of Mexico ~~City.~~City and (iii) expanding the boarding gate capacity at Terminal 2 of the existing Mexico City International Airport, which expansion plan was announced on September 24, 2019. There is still uncertainty about ~~whether or~~ when these renovations will be completed and what impact congestion may have on the existing Mexico City International Airport. We cannot assure you that the airport’s operations will remain at existing levels or increase in the future or that the converted Santa Lucía Airport or expanded Mexico City and Toluca International ~~Airport~~Airports will start operations on time.

~~We may not fully recover our investment for the acquisition of the Terminal 2 NH Collection Hotel.~~

In October 2008, we acquired 90% of the shares of Consorcio Grupo Hotelero T2, S.A. de C.V., which has the rights to develop and operate a 287‑room hotel and approximately 5,000 square meters (53,820 square feet) of commercial space inside the Terminal 2 of Mexico City International Airport, under a lease with Mexico City International Airport that expires in 2029. A Mexican subsidiary of NH Hoteles SA, a Spanish company, owns the other 10%. The Terminal 2 NH Collection Hotel opened in August 2009. The net amount of our investment in the Terminal 2 NH Collection Hotel as of December 31, 2018 was Ps.254,551 thousand, as reflected in our consolidated balance sheet.

The Terminal 2 NH Collection Hotel faces the challenge of maintaining enough market participation as it continues with its operations. The occupancy rate of the hotel may not be sufficient to recover our investment. For the year ended December 31, 2018, annual average occupancy decreased to 83.5% from 86.3% in 2017. Additionally, total revenues amounted to Ps.246,065 thousand in 2018, as compared to Ps.250,777 thousand in 2017 and average rates per room were Ps.2,293 thousand in 2018, as compared to Ps.2,277 thousand in 2017. The occupancy rate of the hotel or the annual average rate may not increase or may decrease in the future.

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In addition, under certain circumstances, the operating lease agreement with the Mexico City International Airport can be terminated by such party with partial or no compensation to us. If the Mexico City International Airport terminates our operating lease agreement, we may not be able to fully recover our investment in the Terminal 2 NH Collection Hotel.

~~Large scale international events, including acts of terrorism, wars and global epidemics, could have a negative impact on international air travel and our revenues.~~

Historically, a substantial majority of our revenues have been derived from aeronautical services, and our principal source of aeronautical services revenues is passenger charges. Passenger charges are payable for each passenger (other than diplomats, infants, transfer and transit passengers) departing from the airport terminals we operate, collected by the airlines and paid to us. In 2016, 2017 and 2018, passenger charges represented 59.2%, 52.2% and 56.2%, respectively, of our total revenues and 63.2%, 64.2% and 65.7%, respectively, of the sum of our aeronautical and non‑aeronautical revenues. Events such as the conflicts in the Middle East, terrorist attacks worldwide and public health crises such as the Severe Acute Respiratory Syndrome, or SARS crisis, the Influenza A(H1N1) crisis and the Ebola crisis have negatively affected in the past the frequency and pattern of air travel worldwide.

The terrorist attacks on the United States on September 11, 2001, had a severe adverse impact on the air travel industry, particularly on U.S. carriers and on carriers operating international service to and from the United States. Airline traffic in the United States fell precipitously after the attacks. Our terminal passenger volumes declined 5.8% in 2002 as compared to 2001. Any future terrorist attacks involving one of our airports, whether or not involving aircraft, will likely adversely affect our passenger volume and results of operations. Among other consequences, airport operations would be disrupted or suspended during the time necessary to conduct rescue operations, investigate the incident and repair or rebuild damaged or destroyed facilities, and our future insurance premiums would likely increase. In addition, our insurance policies do not cover all losses and liabilities resulting from terrorism. Any future terrorist attacks, whether or not involving aircraft, will likely adversely affect our results of operations and financial condition.

Because our revenues are largely dependent on the level of passenger traffic in our airports, any general increase of hostilities relating to terrorist organizations, reprisals thereof, further conflict in the Middle East, further outbreaks of health epidemics such as SARS, Influenza A (H1N1), Ebola, Zika and Chikungunya, or other such international events (and any related economic impact of such events) could result in decreased passenger traffic and increased costs to the air travel industry and, as a result, could cause a material adverse effect on our business, results of operations, prospects and financial condition.

Security enhancements have resulted in increased costs and may require additional investments in the future.

In ~~2018, 11.8%~~2019, 11.9% of the passengers served by our airports were international passengers, of which, ~~75.8%~~75.2% arrived or departed on flights originating in or departing to the United States. The air travel business is susceptible to increased costs resulting from enhanced security and higher insurance. Following the events of September 11, 2001, we reinforced security at our airports, and our general liability insurance premiums increased substantially. For more information on the insurance policies we carry, see “Item 4. Information on the Company – Property, Plant and Equipment.”

Because a substantial majority of our international flights involve travel to and from the United States, we may be required to comply with security directives of the U.S. Federal Aviation Administration (“FAA”) in addition to the directives of Mexican aviation authorities. World events, such as the terrorist attacks worldwide attributed to the Islamic State of Iraq and Syria or any other organization, could lead to additional security measures taken by the FAA or the International Civil Aviation Organization, an agency of the United Nations Organization (“ICAO”), and could require us to incur in additional costs to comply with these measures. Similarly, our airport operations and passenger volume could be negatively impacted by terrorist attacks on aircrafts, such as those which occurred with international airlines’ aircraft operating over Egypt and the Ukraine in 2015.

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While governments in other countries have agreed to indemnify airlines for liabilities they might incur resulting from terrorist attacks, the Mexican government has not done so and has given no indication of any intention to do the same. In addition, fuel prices and supplies, which constitute a significant cost for airlines using our airports, may be subject to increases resulting from any future terrorist attacks, a general increase in international hostilities or a reduction in output of fuel, voluntary or otherwise, by oil producing countries. Such increases in airlines’ costs have resulted in higher airline ticket prices and decreased demand for air travel generally, thereby having an adverse effect on our revenues and results of operations.

Security measures taken to comply with future security directives or in response to a terrorist attack or threat could reduce passenger capacity at our airports due to increased passenger screening and slower security checkpoints and increase our operating costs, which would have an adverse effect on our overall performance.

Furthermore, under the Mexican Airport Law, we are currently responsible for inspecting passengers and their carry‑on luggage before they board any aircraft. Under Mexican law, we may be liable to third parties for personal injury or property damage resulting from the performance of such inspection. In addition, we may be required to adopt additional security measures in the future or undertake capital expenditures if security measures for carry‑on luggage are enhanced, which could increase our liability or adversely affect our operating results.

The operation of baggage screening equipment could increase our expenses and may expose us to greater liability.

The ICAO’s security guidelines requires checked baggage on all international commercial flights and domestic commercial flights to undergo a comprehensive screening process for the detection of explosives. In some countries, such as the United States, the federal government (in the case of the United States, through the Transportation Security Administration (“TSA”)) is responsible for screening checked baggage. On May 1, 2014 and July 1, 2016, the Mexican Bureau of Civil Aviation (currently the Federal Civil Aviation Agency (Agencia Federal de Aviación Civil or “AFAC”))published mandatory circulars CO SA‑17.2/10 R3 and CO SA-17.9/16, respectively, which require that all airlines screen checked baggage and that all airports have screening equipment that complies with specified guidelines. ~~In 2015, we completed the purchase~~We have purchased and ~~installation of~~installed screening equipment in ~~most~~all of our airports to facilitate compliance with the baggage screening guidelines, and our subsidiary, Servicios Complementarios del Centro Norte, S.A. de C.V., has operated the checked baggage screening system since March 1, 2012.

We incur ongoing expenses to maintain and operate this equipment and expect to incur ongoing expenses to maintain any equipment purchased. In the future, we could be required to undertake significant additional capital expenditures for items such as a new screening technology or additional equipment if screening guidelines are expanded further and require that additional steps be taken to comply with the requirements. For instance, replacement of current baggage screening equipment with new Computer Tomography X-ray (CTX) baggage screening equipment is scheduled for ~~2022,~~2020-2025, although regulatory changes could force our airports to undertake this replacement sooner. In addition, ~~in July 2016,~~ the ~~DGAC issued a document titled Airport Security Recommendations, which~~circular CO SA-17.9/16 established that airports must have alternative ~~methods for~~ baggage screening ~~to be used~~methods in case the

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inspection technology currently used is no longer available. We believe that we comply with the ~~Airport Security Recommendations,~~baggage screening guidelines, but ~~the DGAC~~AFAC may require additional investments. These additional expenses could restrict our liquidity and adversely affect our results of operations.

Although Mexican law holds airlines liable for screening checked baggage, the purchase, installation and operation of equipment could increase our exposure to liability as a result of our involvement in the screening process.

Competition from other tourist destinations could adversely affect our business.

The principal factor affecting our results of operations and business is the number of passengers using our airports. The number of passengers using our airports (particularly the Acapulco, Mazatlán and Zihuatanejo airports) may vary as a result of factors beyond our control, including the level of tourism in Mexico. In addition, our passenger traffic volume may be adversely affected by the attractiveness, affordability and accessibility of competing tourist destinations in Mexico, such as Cancún, Puerto Vallarta and Los Cabos, or elsewhere, such as Florida, Puerto Rico, Cuba, Jamaica, the Dominican Republic and other Caribbean islands and destinations in Central America.

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Tourism levels may decrease, and therefore the number of passengers using our airports in the future may not exceed or match current levels, which could have a direct and indirect impact on our aeronautical and non‑aeronautical revenues.

Our business is highly dependent upon revenues from seven of our thirteen airports and the Terminal 2 NH Collection Hotel and could be adversely impacted by any condition affecting those businesses.

In ~~2018,~~2019, approximately ~~80.9%~~80.4% of the sum of our aeronautical and non‑aeronautical revenues were generated from seven of our thirteen airports and the Terminal 2 NH Collection Hotel operations. The Monterrey airport generated the most significant portion of our revenues. The following table lists the percentage of the sum of aeronautical and non‑aeronautical revenues generated at our airports, including the percentage of total revenues generated by our hotel services:


	For Year Ended
Airport	December 31, ~~2018~~2019
Monterrey	~~45.8~~44.5	%
Culiacán	~~8.8~~9.0	%
Chihuahua	~~6.2~~6.3	%
Ciudad Juárez	~~5.3~~5.8	%
Mazatlán	~~4.8~~4.9	%
Acapulco	3.5	%
Terminal 2 NH Collection Hotel	~~3.6~~3.4	%
Tampico	~~3.2~~3.0	%
~~Acapulco~~	~~3.2~~	%
Six other airports, Servicios Complementarios del Centro Norte and OMA Logística, S.A. de C.V. (“OMA Logística”)(1)	~~19.1~~19.6	%
Total	100.0	%

(1)

OMA Logística includes revenues from Consorcio Hotelero Aeropuerto Monterrey, S.A.P.I. de C.V. and OMA-VYNMSA Aero Industrial Park, S.A. de C.V.

As a result of the substantial contribution to our revenues from these seven airports and the operation of the Terminal 2 NH Collection Hotel, any event or condition affecting these principal airports or the Terminal 2 NH Collection Hotel could have a material adverse effect on our business, results of operations, prospects and financial condition.

Lastly, we cannot predict the effect COVID-19 will have on our revenues. For more information on risks related to COVID-19 see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.”

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We are dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity risks.

We rely on a variety of information technology to manage our operations. The proper functioning of these systems is critical to the efficient operation and management of our business. In addition, these systems may require modifications or upgrades as a result of technological changes or growth in our business. These changes may be costly and disruptive to our operations, and could impose substantial demands on management time. Our systems may be vulnerable to damage or disruption caused by circumstances beyond our control, such as catastrophic events, power outages, natural disasters, computer system or network failures, viruses or malware, physical or electronic break‑ins, unauthorized access and cyber‑attacks. Currently, our information systems are protected with backup systems, including physical and software safeguards located outside of our offices for protection purposes, and a cold site on critical systems to recover information technology operations. Furthermore, we undertake other steps to secure our systems and electronic information from exogenous events. These safety components reduce the risk of disruptions, failures or security breaches of our information technology infrastructure and are reviewed periodically by external advisors. Any such disruption, failure or security breach of our information technology infrastructure, including our back‑up systems, could have a negative impact on our operations.

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Additionally, the security risks associated with information technology have increased in recent years due to an increase in more complex types of cyber-attacks. A failure of or attack to our information technology systems or on those of our contractors could affect our business or result in the disclosure or misuse of confidential or personal information, which could cause significant interruptions in services or other operational difficulties and increases in costs, that could result in losses. Although actions are taken continuously to improve and monitor our information technology systems, these systems remain vulnerable to failures or unauthorized access, which could adversely affect our operations, financial condition and liquidity.

We face risks associated with our diversification activities, which could lead to our inability to recover our investment as planned.

We face risks associated with the nature of the diversification projects that we have developed and in which we participate as shareholders, which could impact our results of operations, prospects and financial condition. Our Terminal 2 NH Collection Hotel and our Hilton Garden Inn Hotel depend on passenger traffic travel to and from the Mexico City International Airport and the Monterrey airport, respectively, and any event that reduces passenger volume in these airports could adversely affect the results of operations of these hotels. The passenger traffic volume in such airports depends on factors beyond our control, such as the attractiveness of the commercial, industrial and tourist centers that the airports serve. Accordingly, there can be no assurance that the passenger traffic volume in such airports will increase or maintain the current level.

As a result of the various measures implemented to control the spread of COVID-19, such as the suspension of non-essential activities and the reduced demand for hotel services, the operation of our two hotels has experienced significant declines. In the first quarter of 2020, the occupancy rates in our Terminal 2 NH Collection Hotel and our Hilton Garden Inn Hotel in the Monterrey airport were 11.6 and 15.4 percentage points lower, respectively, than in the comparable period of 2019. On April 6, 2020, we temporarily suspended services our Hilton Garden Inn Hotel through at least April 30, 2020 due to low occupancy. We expect to reopen the Hilton hotel as soon as the suspension of non-essential activities in Mexico is lifted.

Both of the hotels that we operate, our OMA‑VYNMSA industrial park and our OMA Carga bonded warehouses could face additional competition from third parties developing similar projects in areas adjacent to the Mexico City and the Monterrey airports. Despite our efforts to retain clients, we cannot predict whether our clients will continue occupying our commercial spaces or cancel their contracts. Furthermore, the continued growth at our OMA-VYNMSA industrial park could also decline should there be a slowdown in the Mexican economy. All such factors could adversely affect the profitability of our non‑aeronautical businesses and our ability to recover our investments in such projects.

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Our operations depend on certain key airline customers, and the loss or suspension of operations of one or more of them could result in a loss of a significant amount of our revenues.

Of the total aeronautical revenues generated at our airports in ~~2018,~~2019, VivaAerobus represented 22.4%, Aeroméxico and its affiliates represented ~~24.5%, VivaAerobus represented 21.2%~~21.8%, Volaris represented ~~17.5%,~~20.5% and Interjet represented ~~14.2%~~13.2%. None of our contracts with our airline customers obligates them to continue providing service from our airports and, if any of our key customers reduces their use of our airports, competing airlines may not add flights to their schedules to replace any flights no longer handled by our principal airline customers. Our business and results of operations could be adversely affected if we do not continue to generate comparable portions of our revenues from our key customers.

Due to increased competition, volatility in fuel prices and the general decrease in demand because of global volatility in the financial and exchange markets and economic crises, many airlines are operating in adverse conditions. Should fuel prices increase or in the event of other adverse economic developments, one or more of our principal carriers could become insolvent, cancel routes, suspend operations or file for bankruptcy. All such events could have a material adverse effect on our results from operations. Furthermore, any accident, incident or any other event that affects the perception of safety standards of any of the major airlines may affect its image and generate a public perception that it is less safe or reliable than other airlines. These events would affect consumer demand and the number of passengers serviced by the airline, thus affecting our business, results of operations, prospects and financial condition.

~~Table~~The global airline industry has recently experienced and continues to experience significant financial difficulties and recent warnings regarding industry profitability. In December 2019, the International Air Transport Association, or IATA, issued its 2020 financial forecast for the global commercial airline industry, estimating net post-tax profits of ~~Contents~~about U.S.$29.3 billion, due to stable fuel prices and a slight increase in economic growth. The forecast also indicated that net profit margins were expected to slightly increase to 3.4% in 2020. However, since the outbreak of COVID-19, the IATA has revised its expectations downward during February, March and April 2020 to account for the impact of COVID-19. On April 14, 2020, the IATA estimated that passenger revenues for the industry could decrease 55% in 2020 compared to 2019. The IATA may further reduce its forecasts and the short-term and long-term effects of the COVID-19 outbreak on the global airline industry is still uncertain. It is possible that the economic shock from the COVID-19 outbreak, which has been felt more acutely by airlines, may trigger insolvencies within the global airline industry.

In addition, Mexican law prohibits an international airline from transporting passengers from one Mexican location to another (unless the flight originated outside Mexico), which limits the number of airlines providing domestic service in Mexico. On December 18, 2015, the United States and Mexico entered into an Air Transport Agreement with the purpose of promoting and facilitating an international aviation system, based on competition among airlines, to facilitate the expansion of international air transport opportunities and ensure the highest degree of safety and security in air transport. The agreement, which replaced the agreement that had been in effect since 1960, became effective as of August 21, 2016, after approval by the Mexican Senate and the competent authorities in the United States. The agreement provides for an increase in services on existing routes between both nations, as well as the addition of new routes and an increase in the frequency of flights on existing routes. The agreement also grants Mexican airlines the ability to further penetrate international markets, as it permits airlines from both countries that operate flights between the United States and Mexico to pick up passengers and continue with the flights to a third country. This agreement may be modified in the future to provide for international airlines to operate domestic flights in our airports, but until then we expect to continue to generate a significant portion of our revenues from domestic travel from a limited number of airlines.

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Collective labor conflicts in Mexico could have an adverse impact on our results of operations.

A number of events, such as (i) the ratification by the Mexican Senate of the International Labor Organization’s Convention C098, the “Right to Organize and Collective Bargaining Convention”, (ii) the potential replacement of existing NAFTA labor policies with those policies under the USMCA and (iii) the ~~introduction of bills in~~approval by Congress to modify the Mexican Federal Labor Law, have led to labor conflicts in Mexico, including approximately forty-five (45) labor strikes in Matamoros, Tamaulipas in early 2019. Most of the companies affected by such strikes have accommodated the labor unions’ demands and provided salary increases and significant benefits for their workers.Mexico.

In addition, such conflicts ~~has~~have been exacerbated by (i) new labor unions created to negotiate and/or dispute existing collective bargaining agreements on behalf of the labor unions that currently hold such contracts, (ii) a 16.21% increase of the general minimum wage nationwide as of January 1, 2019 and a subsequent 20.0% increase of the general minimum wage as of January 1, 2020 and (iii) a 100% increase of the minimum wage in the municipalities near the ~~Northern~~northern border of ~~Mexico.~~Mexico on January 1, 2019 and an additional 5.0% increase as of January 1, 2020. These developments in recent months have led workers and labor unions to demand more significant benefits and higher salary increases than in prior years.

Moreover, the effects of the Mexican government's response to COVID-19, which include travel restrictions and stay-at-home ordinances, may strain relationships by and between businesses, on the one hand, and labor unions and/or their employees, on the other. As of the date of this report, the Company cannot predict how COVID-19 will affect its labor force and relations therewith. For more information on the impact of COVID-19, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.” For more information on employee relations, see “If a change in relations with our labor force should occur, such a change could have an adverse impact on our results of operations.”

The Company cannot predict how these developments may affect the Company’s results of operations or its financial condition. Any increased demands by the Company’s unionized workers may lead to higher labor costs, which could have a negative impact on its results of operations.

If a change in relations with our labor force should occur, such a change could have an adverse impact on our results of operations.

If any conflicts with our employees were to arise, including with our unionized employees (which accounted for ~~59.2%~~58.6% of our total employees as of December 31, ~~2018)~~2019), resulting events such as strikes or other disruptions that could arise with respect to our workforce could have a negative impact on our results of operations. As of the date of this report, the effects of the COVID-19 outbreak have not affected our relations with our labor force, but we cannot assure you that any further effects resulting from COVID-19 will not cause any disruptions in the future.

Our unionized employees are represented by a national union of airport workers that operates throughout Mexico. To the extent unionized airport workers seek material modifications to the conditions agreed with us and with other Mexican airport operators, our operations could be adversely affected by union activities, including organized strikes or other work stoppages.

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~~Revenues from~~Our operations could be adversely affected due to changes in the collection of passenger ~~and other~~charges.

Passenger charges are ~~not secured,~~collected by the airlines and then paid to us on the basis of contracts entered into with each airline operating at our airports. We cannot guarantee that all airlines will continue collecting the passenger charges for us. Should one or more airlines stop collecting passenger charges for us, we ~~may not be able~~would have to collect ~~amounts invoiced~~these charges directly ourselves, which would result in ~~the event of the insolvency of one of our principal airline customers.~~

additional costs for us.

In recent years, some airlines have reported losses. In all cases, our revenues from passenger charges and other aeronautical services are secured by a performance bond or other types of guarantees; however, guarantees may not fully cover the amount owed by an airline at a certain date. In the event of the insolvency of any of these airlines, we would not be certain of the collection of any amounts invoiced to that airline in respect of passenger charges.

In addition, the COVID-19 outbreak has and will likely continue to adversely affect the global airline industry. For more information on how COVID-19 has affected airlines, see “Our operations depend on certain key airline customers, and the loss or suspension of operations of one or more of them could result in a loss of a significant amount of our revenues.” Given the economic uncertainty for many airlines, it is possible that airlines will stop paying us the applicable passenger charges. Should one or more airlines stop paying us for passengers (other than diplomats, infants, transfer and transit passengers) departing from our terminals, our business and results of operation could be adversely affected. For more information on the impact of COVID-19 on our business, see “The outbreak of COVID-19 has had, and may continue to have, a negative impact on the global economy and on our business, operations and results.”

The main domestic airlines operating at our airports may refuse to pay certain increases in our specific prices for regulated aeronautical services.

In the past, we have entered into a series of agreements with the Mexican National Air Transportation ~~Board~~Chamber of Commerce (Cámara Nacional de Aerotransportes) and the Ministry of Communications and Transportation (most recently in January 2013, covering the period from January 1, 2013 to December 31, 2015), pursuant to which we established specific prices for regulated aeronautical services applicable to our principal airline customers. Although this agreement has not been renewed as of April ~~19, 2019 ,~~30, 2020, all benefits continue to be provided on the same terms. Furthermore, we have expanded the benefits of the agreement to all domestic and international airlines operating at our airports, even to those airlines that are not affiliated to the Mexican National Air Transportation ~~Board.~~Chamber of Commerce. Historically, amounts paid under these agreements have not been material, and we do not expect any current agreement or any similar future agreements with the Mexican National Air Transportation ~~Board~~Chamber of Commerce or any airline to have a material effect on our results of operations.

Although passenger traffic volume (and therefore overall revenues) may increase, any agreed incentives and/or discounts offered to airlines as a means to prevent or settle any potential dispute could reduce our aeronautical revenues per terminal passenger in the future. In addition, should any of our principal airline customers refuse to continue to make payment to us, or should they refuse to pay increases in our charges for aeronautical services in future years, our results of operations could be adversely impacted by decreased cash flows from operations.

~~Our operations could be adversely affected due to changes in the collection of passenger charges.~~

Passenger charges are collected by the airlines and then paid to us on the basis of contracts entered into with each airline operating at our airports. We cannot guarantee that all airlines will continue collecting the passenger charges for us. Should one or more airlines stop collecting passenger charges for us, we would have to collect these charges directly ourselves, which would result in additional costs for us.

Our operation depends on our management team for its knowledge and experience and the loss of capable executives could affect our operations.

The current and future performance of our operations depends significantly on the continuous contribution of managers and other key employees. In order to achieve the objectives of each manager or key position, the ability, experience, aptitude and knowledge of each candidate is taken into account for recruitment and personnel allocation purposes. We cannot guarantee that in the future our executive team will be maintained, or that if new executives are incorporated, they will have the same level of knowledge and experience. The potential lack of a capable management team could adversely affect the operations, financial situation and results of operations.

The operations of our airports may be affected by the actions of third parties, which are beyond our control.

As is the case with most airports, the operation of our airports is largely dependent on the services of third parties, such as air traffic control authorities, airlines and ground transportation providers. We also depend upon the

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Mexican government or government entities for provision of services, such as electricity, supply of fuel to aircraft, air traffic control and immigration and customs services for our international passengers. The disruption or stoppage of taxi or bus services at one or more of our airports could also adversely affect our operations. We are not responsible for and cannot control the services provided by these parties. Any disruption in, or adverse consequence resulting from, their services, including a work stoppage or other similar event, may have a material adverse effect on the operation of our airports and on our results of operations.

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In addition, if any service providers were to halt operations at any of our airports, we could be required to seek a new provider of these services or to provide these services ourselves, either of which may result in increased costs and have an adverse impact on our results of operations.

We may be liable for property taxes as a result of claims asserted against us by certain municipalities.

Various municipalities have assessed tax credits against us for the payment of property taxes with respect to the real estate on which we operate our airports in those cities. We have appealed all the administrative law proceedings, as well as the tax credits, assessed against us and, while some have been dismissed by the relevant administrative authority, some are still pending. We believe there are no legal grounds which enable the municipalities to collect such taxes and although we intend to defend our position vigorously if procedures are brought by authorities, there can be no assurance that we will be successful in such defense. See “Item 8. Financial Information—Legal Proceedings—Property Tax Claims” for a full discussion of these property tax proceedings. Some Mexican airport operators contesting the assessment of similar property tax claims have been required to post material surety bonds in connection with their challenge of those assessments. If we are required to post similar surety bonds in the future, the terms of the surety bonds may restrict our ability to pay dividends or otherwise limit our flexibility. In addition, if we are required to pay for additional state or municipal rights, we could face costs, limiting our flexibility and our ability to pay dividends.

Furthermore, if the Mexican government changes the current laws or if we do not prevail in ~~any of the~~these proceedings, these tax liabilities could have an adverse effect on our financial condition and results of operations. In addition, any change in law which enables municipalities to request construction or operation permits may affect our ability to comply with investments required under our master development programs, which in turn may result in additional payments for governmental tariffs and affect our results of operations.

Inability to generate sufficient future taxable profits or adverse changes to tax laws, regulatory requirements or accounting standards could have a negative impact on the recoverability of certain deferred tax assets.

We recognize deferred tax assets relating to tax losses carried forward and deductible temporary differences only to the extent that it is probable that future taxable profit will be available against which the tax losses carried forward and the temporary differences can be utilized. Net deferred tax assets amounted to approximately ~~Ps.132,792~~Ps.94,287 at December 31, ~~2018.~~2019. The deferred tax assets are quantified on the basis of currently enacted tax rates and accounting standards and are subject to change as a result of future changes to tax laws or the rules for computing taxable profits and allowable losses. Failure to generate sufficient future taxable profits or changes in tax laws or accounting standards may reduce our estimated recoverable amount of net deferred tax assets. Such a reduction could have an adverse effect on our financial condition and results of operations. For further information on deferred tax assets, refer to Note 4.p. to our audited consolidated financial statements. See “Item 5. Operating and Financial Review and Prospects—Critical Accounting Policies—Deferred Income Taxes.”

Natural disasters could adversely affect our business.

From time to time, the ~~Northern~~northern and ~~Central~~central regions of Mexico experience torrential rains, hurricanes (particularly during the months of July through September) and, depending on the region, earthquakes and volcanic activity. In addition, the Mazatlán, Culiacán and Acapulco airports are susceptible to occasional flooding due to torrential rainfall.

Natural disasters may impede or cause the suspension of operations, damage infrastructure necessary to our operations or adversely affect the destinations served by our airports. For instance, on November 3, 2016, the Tampico airport flooded due to heavy rains, causing the collapse of part of the bordering fence. Although, the affected neighbors

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filed claims for damages against the Tampico airport, the insurance carrier rejected the neighbors’ claims alleging that the damage was caused by a natural disaster. In addition, the Terminal 2 NH Collection Hotel located in Terminal 2 of the Mexico City International Airport was temporarily closed after the earthquake on September 19, 2017. Although the Terminal 2 NH Collection Hotel did not suffer any structural damage, utilities of the hotel were interrupted and hotel operations were suspended until September 25, 2017.

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Any of these events could reduce our passenger and cargo traffic volume in the airports and our guest volume in the Terminal 2 NH Collection Hotel. For example, our international passenger traffic decreased 1.2% during September 2017, partially due to the cancellation of flights caused by hurricanes Harvey and Max. The occurrence of natural disasters in the destinations that we serve could adversely affect our business, results of operations, prospects and financial condition.

We have insurance for the physical facilities at our airports against damage caused by natural disasters, accidents or other similar events, but we do not have insurance covering losses due to resulting business interruption. Moreover, should losses occur, losses caused by damages to the physical facilities may exceed the pre‑established limits on any of our insurance policies.

Our operations are at greater risk of disruption due to the dependence of several of our airports on a single commercial runway.

As is the case with many other domestic and international airports around the world, several of our airports, including the Monterrey, Culiacán, Ciudad Juárez and Mazatlán ~~and Zihuatanejo~~ airports, have only one runway for most commercial ~~aviation runway.~~flights. The operation of our runways may be disrupted due to required maintenance or repairs. In addition, our runways may require unscheduled repair or maintenance due to natural disasters, aircraft accidents and other factors that are beyond our control. The closure of any runway for a significant period of time could have a material adverse effect on our business, results of operations, prospects and financial condition.

We are exposed to risk related to construction projects.

The building requirements under our master development programs could encounter delays or cause us to exceed our budgeted costs for such projects, which could limit our ability to expand capacity at our airports, increase our operating or capital expenditures and could adversely affect our business, results of operations, prospects and financial condition. Such delays or budgetary overruns also could limit our ability to comply with our master development programs, which are established as a necessary requirement to our concessions.

We are exposed to certain risks inherently associated with the rental of real property.

We are exposed to risks generally associated with properties rented to third parties, such as a decline in rental market demand, occupancy rates or rent levels, non‑payment of minimum rent and royalties by tenants or a weakening of the real estate market. Moreover, our real estate assets are located on or adjacent to our airports and serve a particular sector of the rental market, thus exposing us to fluctuations in this specific market. Any of these risks could adversely affect the profitability of our real estate development activities and, consequently, our business, results of operations, prospects and financial position.

We are exposed to the risk of non-performance by our subcontractors.

We subcontract certain services (including security and surveillance services) necessary to conduct our operations. In the event that our subcontractors fail to perform their obligations under our agreements, we could incur extra costs in providing replacements and could be exposed to liability for operations that we may have to provide directly, which could adversely affect our business, results of operations, prospects and financial condition.

In accordance with applicable labor laws, subcontractors are required to register their employees with the Mexican Social Security Institute (Instituto Mexicano del Seguro Social), and anyone employing the services of subcontractors that has failed to comply with these laws is jointly liable for the payment of social security obligations as well as any applicable penalties. Therefore, if subcontractors providing services at our airports do not have their

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employees registered at the Mexican Social Security Institute, we could be held jointly liable for the payment of social security obligations that such contractors may have, as well as any applicable penalties.

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Our ability to expand certain of our airports and to comply with applicable safety guidelines could be limited by difficulties we encounter in acquiring additional land on which to operate our airports.

Certain guidelines established by the ICAO require the maintenance of a perimeter surrounding the land used for airport operations. At several of our airports, we do not control portions of the land within the required perimeters. If portions of such land adjacent to certain of our airports are developed by third parties in a manner that encroaches on the required perimeters, our ability to comply with applicable guidelines of the ICAO or to expand our airport operations could be adversely affected. Also, the growth of certain cities in the proximity of our airports could limit our ability to expand our airports.

To allow the future expansion of the Monterrey airport, including the construction of a second commercial runway and the relocation of the control tower, in February and June 2007, March and May 2008, July and December 2009 and February, July and December 2010, we completed acquisitions of land surrounding the airport with an aggregate area of 777 hectares (3 square miles), ~~including the construction of a second commercial runway,~~ for an aggregate price of Ps.1,559,381 thousand (U.S.$121.3 million). Improvements made to airport facilities at our expense may be recognized by ~~the Mexican Bureau of Civil Aviation~~AFAC as part of our investment in the airport concession. We received authorization from ~~the Mexican Bureau of Civil Aviation~~AFAC to reallocate Ps.386,538 thousand (amount expressed in nominal 2009 pesos) of our investment in this land to investments included in the 2011–2015 master development program for the Monterrey airport. We are currently reviewing various possibilities for the recovery of the remaining investment with ~~the Mexican Bureau of Civil Aviation~~AFAC at a cost of Ps.695,759 thousand (amount expressed in nominal 2009 pesos), which was not recognized under the 2016–2020 master development program for the Monterrey airport. The remaining amount of the investments may not be recognized by the Ministry of Communications and Transportation in the future.

Our future profitability and growth will depend upon our ability to expand our airports in the future. Potential limitations on our possibility of expansion, such as those described above, could restrict any such expansion and thus have a material adverse effect on the future profitability and growth of our business.

We are exposed to risks inherent to the operation of airports.

We are obligated to protect the public at our airports and to reduce the risk of accidents at our airports. As with any company dealing with members of the public, we must implement certain measures for the protection of the public, such as fire safety in public spaces, design and maintenance of car parking facilities and access routes to meet road safety rules. We are also obligated to take certain measures related to aviation activities, such as maintenance, management and supervision of aviation facilities, rescue and fire‑fighting services for aircraft, measurement of runway friction coefficients, flood control at the Acapulco airport and measures to control the threat from birds and other wildlife on airport sites. These obligations may require us to incur additional costs and could increase our exposure to liability to third parties for personal injury or property damage resulting from our operations.

Our insurance policies may not provide sufficient coverage against all liabilities.

While we seek to insure all reasonable risks, our insurance policies may not cover all of our liabilities in the event of an accident, terrorist attack or other incident. The markets for airport insurance and construction insurance are limited, and a change in coverage policy by the insurance companies involved could reduce our ability to obtain and maintain adequate or cost‑effective coverage. A certain number of our assets cannot, by their nature, be covered by property insurance (notably aircraft movement areas, and certain civil engineering works and infrastructure). In addition, we do not currently carry business‑interruption insurance.

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We are exposed to risks related to handling cargo.

The air cargo system is a complex, multi‑faceted network that handles a vast amount of freight, packages and mail carried aboard passenger and all‑cargo aircraft. The air cargo system is vulnerable to several security threats, including: potential plots to place explosives aboard aircraft; illegal shipments of hazardous materials; criminal activities, such as smuggling and theft; and potential hijackings and sabotage by persons with access to aircraft. Several procedural and technology initiatives to enhance air cargo security and detect terrorist and criminal threats have been put in place, such as an x‑ray machine certified by the TSA in the bonded OMA Carga area at the Monterrey airport, or are under consideration.

We may be subject to risks related to the integrity of our facilities or the reduction of our cargo traffic volume. The occurrence of such events could adversely affect our business, results of operations, prospects and financial condition.

We may not be able to detect money laundering operations and other illegal or improper activities, which could expose us to additional liabilities and adversely affect our operations and financial results.

We are required to comply with applicable anti-money laundering and anti-terrorism and other regulations in Mexico. Such laws require us to adopt and implement certain policies and procedures designed to detect and prevent transactions with third parties involved in money laundering or terrorist activities. Although we have adopted such policies and procedures, these procedures require services related to third parties that are not under our control, including third-party providers of complementary services or retailers, restaurants and other commercial tenants leasing spaces at the airport. To the extent that we may fail to fully comply with applicable laws and regulations or fail to detect illegal activities carried out by third parties, the competent authorities may impose certain fines on us and our reputation may also be adversely affected.

We could be exposed to additional risks if we pursue business opportunities in other countries.

From time to time, we may consider strategic participation in airport assets located in other countries. We may evaluate international expansion opportunities through capital investment in other concessions. Expansion into a market outside of Mexico could require significant capital expenditures. If we pursue an international expansion opportunity, we could face internal or external risks, including, without limitation: (i) a lack of market experience in the relevant country, (ii) foreign exchange and economic volatility, (iii) the dedication of significant management resources to ~~executing~~execute the international operation and (iv) exposure to risks inherent to doing business in the relevant country. Our inability to successfully manage the risks and uncertainties related to such business opportunities could have a material adverse effect on our business, results of operations, prospects and financial condition, including our capital structure.

Risks Related to the Regulation of Our Business

The Company provides a public service regulated by the Mexican government, and the flexibility in managing aeronautical activities is limited by the regulatory environment in which the Company operates.

The Company’s aeronautical fees charged to airlines and passengers are regulated, like most airports in other countries. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, approximately ~~69.8%~~61.0%, ~~61.0%~~65.0% and ~~65.0%~~67.5%, respectively, of the Company’s total revenues, and approximately ~~74.4%~~74.9%, ~~74.9%~~76.0% and 76.0%, respectively, of the sum of its aeronautical and non‑aeronautical revenues were earned from aeronautical services, which are subject to price regulation under the Company’s maximum rates. These regulations may limit the Company’s flexibility in operating its aeronautical activities, which could have a material adverse effect on its business, results of operations, prospects and financial condition. In addition, several of the regulations applicable to the Company’s operations that affect its profitability are authorized (as in the case of the master development programs) or established (as in the case of maximum rates) by the Ministry of Communications and Transportation for five‑year terms. The Company generally does not have the ability to unilaterally change its obligations (such as the investment obligations under its master development programs or the obligation under its concessions to provide a public service) or increase our maximum rates applicable under those regulations should the passenger traffic or other assumptions on which the regulations were based change during the applicable term. In addition, this price regulation system may be amended in the future in a manner that would cause additional sources of the Company’s revenues to be regulated.

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The Company’s results of operations may be adversely affected by required efficiency adjustments to its maximum rates.

The Company’s maximum rates in Mexico are subject to annual efficiency adjustments, which have the effect of reducing the maximum rates for each year to reflect projected efficiency improvements. For the five year period ending December 31, 2015 and December 31, 2020, the maximum rates applicable to the Company’s airports reflected an annual efficiency improvement of 0.70%. Future annual efficiency adjustments will be determined by the Ministry of Communications and Transportation in connection with the setting of each Mexican airport’s maximum rates every five years. For a description of these efficiency adjustments, see “Item 4. Information on the Company—Regulatory Framework—Revenue Regulation—Methodology for Determining Future Maximum Rates.” We cannot provide assurance that we will achieve efficiency improvements sufficient to maintain or increase our operating income as a result of the progressive decrease in each of our airport’s maximum rate.

The Company cannot predict how the regulations governing the business will be applied.

Many of the laws, regulations and instruments that regulate the Company’s business were adopted or became effective in 1999, and there is only a limited history that would allow the Company to predict the impact of these legal requirements on its future operations. Mexican law establishes ranges of sanctions that might be imposed should the Company fail to comply with the terms of one of its concessions, the Mexican Airport Law and its regulations or other applicable laws. The Company cannot predict the sanctions that are likely to be assessed for a given violation within these ranges. It may encounter difficulties in complying with these laws, regulations and instruments.

Although the master development programs and maximum rates through 2020 have been set, the Company cannot predict what the master development program for 2021 and following years will establish. When determining the maximum rates for the next five year period (from 2021 to 2025), the Ministry of Communications and Transportation may be solicited by different entities (for example, the Antitrust Commission) and the carriers operating at our airports) to modify the maximum rates, thus reducing the Company’s profitability. The laws and regulations governing the business, including the rate‑setting process and the Mexican Airport Law, may change in the future or be applied or interpreted in a way that could have a material adverse effect on the Company’s business, results of operations, prospects and financial condition.

Additionally, on October 16, 2019, the Ministry of Communications and Transportation ~~announced in 2013 that it intends to establish a new,~~established AFAC, an independent regulatory agency, ~~the Federal Agency of Civil Aviation,~~ that ~~is expected to serve a similar role as~~replaced the Mexican Bureau of Civil Aviation (Dirección General de Aeronáutica Civil~~, or “DGAC”~~) of. AFAC is responsible for establishing, coordinating, overseeing and controlling international and national air transportation, as well as the airports, complementary services and generally all activities related to civil aviation. ~~The~~Even though AFAC has been formally established, its internal regulations and operation manuals are still pending as of the date of this report. As such, the Company cannot predict ~~whether or when~~how this new agency will be organized, the scope of its authority, the actions that it will take in the future or the effect of any such actions on its business.

On February 20, 2014, a bill of the new Federal Antitrust Law (Ley Federal de Competencia Económica) was submitted to Mexico’s Congress in furtherance and as a result of certain amendments to Mexico’s Constitution passed in 2013. The bill was enacted and published on May 23, 2014. The law grants broader powers to the Antitrust Commission, including the authority to regulate essential facilities, order the divestment of assets and eliminate barriers to competition in order to promote access to the market. The new law also sets forth important changes in connection with mergers and anti‑competitive behavior, increases liabilities and the amount of fines that may be imposed for violations of the law and limits the availability of legal defenses against the application of the law. The Antitrust Commission may therefore determine that the services that the Company provides at its airports are essential and require it to implement significant changes to its business operations and thus generate a significant impact on its results of operations.

For example, pursuant to the new Federal Antitrust Law (Ley Federal de Competencia Económica), the Antitrust Commission determined that the slots allocated to air carriers at the Mexico City International Airport constitute an essential service. The Antitrust Commission found that the allocation of slots led to flight delays and cancellations and, among others, hindered entry to new competitors. On July 3, 2017, the Antitrust Commission issued a series of corrective measures (the “Corrective Measures”) for the Mexico City International Airport to address the inefficiencies and anticompetitive effects observed at such airport.

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In response to the Antitrust Commission’s findings, the Ministry of Communications and Transportation (Secretaría de Comunicaciones y Transportes) published an amendment to the regulations of the Mexican Airport Law in the Federal Official Gazette on September 29, 2017, as well as general guidelines for the allocation of slots at congested airports (the “General Guidelines”). The Antitrust Commission found that the reforms issued by the Ministry of Communications and Transportation did not provide a solution to the issues the Antitrust Commission had addressed and that the General Guidelines directly contradicted the Corrective Measures. As a result, the Antitrust Commission filed an appeal (controversia constitucional) before the Mexican Supreme Court, arguing that the Antitrust Commission, not the Ministry of Communications and Transportation, has the authority to regulate the allocation of slots as a public essential service. ~~As of April 19,~~On November 26, 2019 the Mexican Supreme Court ~~has not resolved the appeal. If the Mexican Supreme Court rules in favor of~~ruled against the Antitrust Commission and limits the authority of the Mexican Ministry of Communications and Transportation, new rules or regulations may be established by the Antitrust Commission, which could adversely affect the Company’s business, results of operations, prospects and financial condition.Commission.

Even though none of its airports have been declared congested as of the date of this report, the Company cannot predict whether or when this will happen. Similarly, it cannot predict whether the Antitrust Commission will declare any of its airports, or any complementary or commercial service provided at the airports, as essential services, and consequently, establish rules, recommendations, guidelines or conditions that could limit or restrict the Company’s aeronautical and/or non-aeronautical revenues.

The regulations pursuant to which the maximum rates applicable to the aeronautical revenues are established do not guarantee that the consolidated results of operations, or the results of operations of any airport, will be profitable, or that the Company will realize the expected return on investment.

The regulations applicable to the Company’s aeronautical activities establish an annual maximum rate for each airport, which is the maximum annual amount of revenues per workload unit (which is equal to one terminal passenger or 100 kilograms (220 pounds) of cargo) that the Company may earn at that airport from services subject to price regulation. For a discussion of the framework for establishing its maximum rates and the application of the rates, see “Item 4. Information on the Company—Regulatory Framework—Revenue Regulation.” On December 21, 2015, the Ministry of Communications and Transportation determined, based on the terms of the Company’s concessions, the maximum rates for its airports from January 1, 2016 through December 31, 2020. Under the terms of the Company’s concessions, there is no guarantee that the results of operations of any airport will be profitable. The Company may not realize its expected return on investment from investments under the master development programs.

The Company’s concessions provide that an airport’s maximum rates will be adjusted periodically for inflation (determined by reference to the Mexican ~~producer price index,~~Producer Price Index (Índice Nacional de Precios Productor), excluding fuel). Although the Company is entitled to request additional adjustments to an airport’s maximum rates under certain circumstances including, among others, required capital investments not foreseen in the master development programs, decreases in capital investments attributable to Mexican economy‑related passenger traffic decreases or modifications of the concession tax payable by the Company, its concessions provide that such a request will be approved only if the Ministry of Communications and Transportation determines that certain limited events specified in the concessions have occurred. Therefore, such a request may not be granted in the future. If a request to increase an airport’s maximum rates is not granted, and the Company is impacted by the circumstances that led to the request, its results of operations and financial condition could be adversely affected, and the value of Series B shares and ADSs could decline.

The Company business is dependent upon international regulations that affect Mexican airlines.

The FAA evaluates the legal framework for civil aviation and issues related to the monitoring, staff training and inspection processes related to regulations issued by the ICAO.

On July 30, 2010, the FAA downgraded Mexico’s aviation safety rating from an ICAO Category 1 rating to an ICAO Category 2 rating, as a result of the FAA’s visit to the Mexican Bureau of Civil Aviation (currently AFAC)between January and July 2010. The downgrade was attributable to an insufficient number of flight inspectors and administrative and organizational elements in the Mexican Bureau of Civil ~~Aviation.~~

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Aviation (currently AFAC).

The consequences of the downgrade from a Category 1 rating to a Category 2 rating were the suspension of the right to operate code‑shared flights and the restriction of Mexican airlines’ ability to increase the frequency of, or add

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new routes to, the United States and that the international routes of Mexicana de Aviación would not be flown by any Mexican carrier with a Category 2 rating.

Mexico regained its Category 1 safety rating on December 1, 2010; however, Mexico may be downgraded in the future, and the Company cannot be certain of how long this Category 1 rating will be maintained. We cannot predict what impact such a downgrade would have on our passenger traffic or results of operations, or on the public perception of the safety of our airports.

If the Company exceeds the maximum rate at any airport at the end of any year, it could be subject to sanctions.

Historically, the Company has set the tariffs it charges for aeronautical services at each airport in order to come as close as possible to its authorized maximum rate for that airport in any given year. For example, in ~~2018,~~2019, the revenues subject to maximum rate regulation represented approximately ~~97.8%~~99.0% of the amounts the Company was entitled to earn under the maximum rates for all of its airports. The Company may not be able to establish tariffs in the future that allows it to collect substantially all of the revenues it is entitled to earn from services subject to price regulation.

The specific tariffs the Company charges for aeronautical services are determined based on various factors, including projections of passenger traffic volumes, the Mexican ~~producer price index~~Producer Price Index (excluding fuel), the Mexican ~~consumer price index~~Consumer Price Index and the value of the peso relative to the U.S. dollar. These variables are outside of the Company’s control. The Company’s projections could differ from the applicable actual data, and, if these differences occur at the end of any year, they could cause the Company to exceed the maximum rate at any one or more of its airports during that year.

If the Company exceeds the maximum rate at any airport at the end of any year, the Ministry of Communications and Transportation may assess a fine and may reduce the maximum rate at that airport in the subsequent year. The imposition of sanctions for violations of certain terms of a concession, including for exceeding an airport’s maximum rate, can result in termination of the concession if the relevant term has been violated and sanctions have been imposed at least three times. In the event that any one of the Company’s concessions is terminated, its other concessions may also be terminated. For a discussion of events that may lead to a termination of a concession, see “Item 4. Information on the Company—Regulatory Framework—Penalties and Termination and Revocation of Concessions and Concession Assets.”

Depreciation of the peso may cause the Company to exceed the maximum rates.

The Company aims to charge prices that are as close as possible to its maximum chargeable rates, and it is entitled to adjust the specific tariffs only once every six months for inflation (or earlier upon a cumulative increase of 5% in the Mexican ~~producer price index~~Producer Price Index (excluding fuel)). However, the Company generally collects passenger charges from airlines 30 to 60 days following the date of each flight. The tariffs for the services that it provides to international flights or international passengers are generally denominated in U.S. dollars but are paid in Mexican pesos based on the average exchange rate for the month prior to each flight. Accordingly, depreciation of the peso, particularly late in the year, could cause the Company to exceed the maximum rates at one or more of its airports, which could lead to the imposition of fines and the subsequent termination of one or more of its concessions.

The peso has historically experienced significant volatility. From December 31, 2016 to December 31, 2017, the peso slightly appreciated by approximately 4.7%, from Ps.20.62 per U.S.$1.00 on December 31, 2016 to Ps.19.64 per U.S.$1.00 on December 31, 2017. From December 31, 2017 to December 31, 2018, the peso remained the same at Ps.19.64 per U.S.$1.00. From December 31, 2018 to December 31, 2019, the peso appreciated by approximately 3.9%, from Ps.19.64 per U.S.$1.00 on December 31, 2018 to Ps.18.86 per U.S.$1.00 on December 31, 2019. On April ~~19, 2019,~~22, 2020, the exchange rate was ~~Ps.18.77~~Ps.24.59 per U.S.$1.00.

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The Mexican government may terminate or reacquire the concessions under various circumstances, some of which are beyond the control of the Company.

The Company’s concessions are its principal assets, and it would be unable to continue operations without them. A concession may be revoked by the Mexican government for certain prescribed reasons, including the failure to comply with the master development programs, a temporary or permanent halt in the Company’s operations, actions

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affecting the operations of other concession holders in Mexico, the failure to pay damages resulting from its operations, the failure to keep the rates from exceeding its maximum rates or the failure to comply with any other material term of its concessions. Violations of certain terms of a concession (including violations for exceeding the applicable maximum rate) can result in revocation of a concession only if sanctions have been imposed for violations of the relevant term at least three times. Violations of other terms of a concession can result in the immediate termination of the concession. The concessions may also be terminated upon the Company’s bankruptcy or insolvency. Violations of the Mexican Airport Law, its regulations or other federal regulations could result in similar sanctions. In the event that any one of the Company’s concessions is terminated, its other concessions may also be terminated. For a discussion of events that may lead to a termination of a concession, see “Item 4. Information on the Company—Regulatory Framework—Penalties and Termination and Revocation of Concessions and Concession Assets.”

Under applicable Mexican law and the terms of the Company’s concessions, its concessions may also be made subject to additional conditions, including under the renewed master development programs, which the Company may be unable to meet. Failure to meet these conditions may also result in fines, other sanctions and the termination of the concessions.

The Mexican government may also terminate one or more of the concessions at any time through reversion, if, in accordance with applicable Mexican law, it determines that it is in the public interest to do so. The Mexican government may also assume the operation of any airport in the event of war, public disturbance or a threat to national security. In addition, in the case of a force majeure event, the Mexican government may require the Company to implement certain changes in its operations. In the event of a reversion of the public domain assets that are the subject of the concessions, the Mexican government under Mexican law is required to compensate the Company for the value of the concessions or added costs based on the results of an audit performed by appraisers or, in the case of a mandated change in the Company’s operations, the cost of that change. Similarly, in the event of an assumption of the Company’s operations, other than in the event of war, the government is required to compensate it and any other affected parties for any resulting damages. The Company may not receive compensation equivalent to the value of its investment in or any additional damages related to its concessions and related assets in the event of such action.

In the event that any one of the Company’s concessions is terminated, whether through revocation or otherwise, its other concessions may also be terminated. Thus, the loss of any concession would have a material adverse effect on the business and results of operations.

The Mexican government could grant new concessions that compete with the airports operated by the Company.

The Mexican government could grant additional concessions to operate existing government‑managed airports or authorize the construction of new airports, which could compete directly with the airports operated by the Company.

On February 5, 2014, the Mexican government announced in the Federal Official Gazette that the Ministry of Communications and Transportation granted to Administradora de Servicios Aeroportuarios de Chihuahua, S.A. de C.V., a concession for 20 years to construct, operate and exploit a civil‑aviation airport in the municipality of Bocoyna, Chihuahua, located 250 kilometers (144 miles) from the city of Chihuahua, within an area of 95.5 hectares (0.4 square miles). The government of the state of Chihuahua owns 98% of the capital stock of Administradora de Servicios Aeroportuarios de Chihuahua, S.A. de C.V. The ~~Bocoyna airport is expected to operate daily public and private domestic flights. The~~ airport has an ICAO Category 3C rating and could present competition to the Company’s airport located in the municipality of Chihuahua, which has a higher ICAO Category 4D rating and is located 18 kilometers (11.2 miles) from the city of Chihuahua. The Ministry of Communications and Transportation has the capacity to upgrade the category of the airport depending on improvements to infrastructure made by the concessionaire or could downgrade the category if the concessionaire does not maintain adequate conditions in the airport. ~~To date,~~On February 21, 2020, the State of Chihuahua announced that the airport ~~has not announced~~is expected to start operations in late 2020, with limited operations through late 2021. The airport is expected to be fully operational beginning in 2022 and will serve both commercial and general aviation flights. It will have an annual capacity to serve up to 450,000 passengers. As of the ~~commencement~~ date of ~~operations.~~

~~Table~~this report, the Company cannot predict whether the Chihuahua airport will materially affect its results of ~~Contents~~

operations or financial performance.

In the future, the Company may face competition from Aeropuerto del Norte, an airport near Monterrey operated by a third party pursuant to a concession. Historically, Aeropuerto del Norte has been used solely for general

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aviation operations. The state of Nuevo León has requested in the past that the Ministry of Communications and Transportation amend Aeropuerto del Norte’s concession to allow it to serve commercial aviation operations. To date, the Ministry of Communications and Transportation has not amended Aeropuerto del Norte’s concession. However, the Ministry of Communications and Transportation may authorize such an amendment and commercial aviation flights may operate from Aeropuerto del Norte in the future. Any competition from other such airports could have a material adverse effect on the Company’s business, results of operations, prospects and financial condition. Under certain circumstances, the grant of a concession for a new or existing airport must be made pursuant to a public bidding process. In the event that a competing concession is offered in a public bidding process, the Company may not participate in such a process, or it may not be successful if it were to participate. See “Item 4. Information on the Company—Regulatory Framework—Grants of New Concessions.”

The Ministry of Communications and Transportation could require the Company to monitor certain aircraft movements at its airports that the Company does not currently control, which could result in increased costs.

The Mexican Air Traffic Control Authority (Servicios a la Navegación en el Espacio Aéreo Mexicano) or “SENEAM”, could require the Company to monitor certain aircraft movements at its airports that the Company does not currently control, which could result in increased costs. SENEAM may require the Company to manage and control aircraft movements in and out of its arrival and departure gates and remote boarding locations at its airports. Should SENEAM require the Company to control, or if the Company, for efficiency purposes, requests to control, these aircraft movements directly at any or all of its other airports in the future, the Company’s results of operations could be negatively impacted by increased operating insurance and liability costs resulting from taking on these obligations.

Changes to Mexican laws, regulations and decrees applicable to the Company could have a material adverse impact on the results of operations.

In recent years, the Mexican government has implemented changes to the tax laws applicable to Mexican companies, including the Company. The terms of the Company’s concessions do not exempt it from any changes to the Mexican tax laws. Should the Mexican government implement changes to the tax laws that result in the Company having significantly higher income tax, the Company will be required to pay higher amounts due pursuant to any such changes, which could have a material adverse impact on its results of operations. For example, the issuance of the Business Flat Tax (Impuesto Empresarial a Tasa Única), which was published on October 1, 2007 and repealed in 2013, adversely impacted the Company’s results of operations in each of the years from 2007 through 2013. In addition, changes to the Mexican constitution or to any other Mexican laws could also have a material adverse impact on the Company’s business, results of operations, prospects and financial condition.

On November 1, 2013, Mexico’s Congress approved several tax reforms that became effective at the beginning of 2014. These reforms included changes to the Income Tax Law (Ley del Impuesto Sobre la Renta), Value Added Tax Law (Ley del Impuesto al Valor Agregado) and the Tax Code (Código Fiscal de la Federación). The tax reforms also repealed the Business Flat Tax Law and the Tax on Cash Deposits Law (Ley del Impuesto a los Depósitos en Efectivo).

The main result of the tax reforms was the elimination of a previously recognized deferred Business Flat Tax liability and the recognition of deferred asset taxes based only on the Mexican corporate income tax at a number of the Company’s airports representing Ps.339,325 thousand. The Company cannot predict the impact that future federal tax legislation reforms in Mexico may have on its financial condition and results of operations.

On December 27, 2016, the Ministry of Finance and Public Credit announced an increase, effective January 1, 2017, in the maximum gasoline and diesel prices to be applied in certain regions of Mexico, which caused an increase of gasoline prices of up to 20% in those areas. Furthermore, in November 2017, the Mexican Government removed price controls on gasoline and diesel. The removal of price controls and the resulting price increases led to widespread protests across Mexico. The Company cannot predict the effect of changes in gasoline and diesel prices, and any related political and social unrest, on the Mexican economy or whether the Mexican Government may alter its strategy for price liberalization in the future.

On May 1, 2019, the Mexican Government published significant reforms in the Federal Official Gazette to the Mexican Federal Labor Law. These changes include the creation of new courts specializing in labor law and protections

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to the collective rights of workers and union rights. As a result of these reforms, employees cannot be forced to join a union and more than one union can exist in every workplace. Currently, all unionized Company employees are represented by a national union of airport workers that operates throughout Mexico. To the extent unionized airport workers seek to create or join new unions, and/or materially modify the conditions agreed with the Company and with other Mexican airport operators, the Company’s operations could be adversely affected by union activities, including organized strikes or other work stoppages. The Company cannot predict how these developments may affect the Company’s results of operations or its financial condition. Any increased demands by the Company’s unionized workers may lead to higher labor costs, which could have a negative impact on its results of operations. For more information, see “Collective labor conflicts in Mexico could have an adverse impact on our results of operations” and “If a change in relations with our labor force should occur, such a change could have an adverse impact on our results of operations.”

In addition, as part of the current Federal Administration’s effort to protect worker’s rights, on October 23, 2019, Mexican Official Norm (Norma Oficial Mexicana, or “NOM”) NOM-035-STPS-2018 became effective. This NOM seeks to identify and prevent psychosocial risk factors in the workplace and promote a favorable work environment. Some of the new obligations set forth in this NOM include the creation of internal policies to prevent psychosocial risks, such as workloads, excessive work hours and shift rotations, negative interference in family life, negative leaderships in the workplace and violence in the workplace. While the Company has complied with the NOM provisions, the Company cannot predict whether its employees will eventually claim that the Company violated any of the provisions under the NOM. Any claims against the Company filed by its employees may lead to higher labor costs, which could have a negative impact on our results of operations. For more information, see “If a change in relations with our labor force should occur, such a change could have an adverse impact on our results of operations.”

Risks Related to Mexico

The Company’s business is significantly dependent upon the volume of air passenger traffic in Mexico, and negative economic developments in Mexico could adversely affect its business and results of operations.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, domestic terminal passengers have represented approximately ~~87.3%~~87.6%, ~~87.6%~~88.2% and ~~88.2%~~88.1%, respectively, of the passenger traffic volume in the Company’s airports. In addition, all of its assets are located, and all of its operations are conducted, in Mexico. Accordingly, the Company’s financial conditions and results of operations are substantially dependent on economic conditions prevailing from time to time in Mexico. As a result, its business, financial condition and results of operations could be adversely affected by any deterioration of the general condition of the Mexican economy, by a devaluation of the peso, by inflation and high interest rates in Mexico or by other negative political, social and economic developments in Mexico.

In the past, Mexico has experienced economic crises, caused by internal and external factors, characterized by exchange‑rate instability (including large devaluations), high inflation, high domestic interest rates, economic contraction, a reduction of international capital flows, a reduction of liquidity in the banking sector and high unemployment rates.

The Mexican economy underwent an economic crisis that began in 2008 and continued in 2009 as a result of the impact of the global financial crisis, which affected many emerging economies. The Mexican economy’s link with the U.S. economy remains very important, and therefore, any downside to the economic outlook of the U.S. may hinder any recovery in Mexico. This correlation may have an impact on Mexico’s GDP growth and other macro-economic conditions. The Mexican economy achieved real GDP growth rates of ~~2.0%~~-0.1%, 2.0% and ~~2.3%~~2.0% in 2019, 2018 ~~2017~~ and ~~2016,~~2017, respectively, and is estimated to decrease by 6.6% in 2020 and to grow ~~at 2.0% and 2.4%~~by 3.0% in ~~2019 and 2020, respectively,~~2021, according to the World ~~Bank.~~ Economic Outlook published by the International Monetary Fund in April 2020.

During ~~2018,~~2019, average reference interest rates in Mexico increased by 9323 basis points compared to ~~2017.~~2018. The annualized interest rates on 28‑day short‑term Mexican treasury bills, or Cetes (Certificados de la Tesorería de la Federación), averaged approximately 3.0%, ~~3.0%,~~ 4.2%, 6.7%, 7.6% and ~~7.6%~~7.8% for ~~2014,~~ 2015, 2016, 2017, 2018 and ~~2018,~~2019, respectively. To the extent that the Company incurs peso‑denominated debt in the future, it could be at high interest rates.

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If inflation or interest rates increase significantly or if the Mexican economy is otherwise further adversely impacted, the Company’s business, financial condition, prospects and results of operations could be materially and adversely affected because, among other things, demand for transportation services may decrease. Similar events may occur, and the recurrence of such events may adversely affect the Company’s business, results of operations, prospects and financial condition.

Political conditions in Mexico, including as a result of Mexico’s recent national presidential and legislative elections, could materially and adversely affect the Mexican economy and political climate and, in turn, the operations of the Company.

Presidential and federal congressional elections in Mexico were held on July 1, 2018. Mr. Andrés Manuel López Obrador, a member of the Movimiento Regeneración Nacional (National Regeneration Movement, or Morena), was elected President of Mexico and took office on December 1, 2018, replacing Mr. Enrique Peña Nieto, a member of the Partido Revolucionario Institucional (Institutional Revolutionary Party, or PRI). President López Obrador’s term will expire on September 30, 2024. Historically, the Mexican president has strongly influenced new policies and governmental actions that impact the Mexican economy. We cannot assure you that the current administration will maintain business-friendly and open-market economic policies and policies that stimulate economic growth and social stability. The new administration could implement substantial changes in law, policy and regulations in Mexico, which could adversely affect our business, financial condition, results of operations and prospects. In addition, any actions taken by the new administration may lead to riots, protests and looting that could adversely affect our operations. Our financial condition and results of operation may be adversely affected by changes in Mexico’s political climate, to the extent that such changes affect the nation’s economic policies, growth, stability, outlook or regulatory environment.

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In addition, following the congressional elections on July 1, 2018, Morena obtained an absolute majority in the Mexican Chamber of Deputies and, together with its allied political parties (Partido del Trabajo and Partido Encuentro Social), obtained a majority in the Mexican Senate. The newly-elected members of the Mexican Congress took office on September 1, 2018. We cannot assure you that Morena and its political party allies will not introduce new legislative initiatives or modify existing legislation that could, in turn, result in economic or political conditions that could materially and adversely affect our business. Changes in laws, public policies or regulations may affect the political and economic environment in Mexico and, consequently, contribute to economic uncertainty and heightened volatility of the Mexican capital markets and in securities issued by Mexican companies.

Furthermore, our business may be adversely affected by fluctuations in the value of the U.S. dollar as compared to the Mexican peso, inflation, interest rates, changes in laws and other political or social developments in Mexico over which we have no control. Any of the above may have an adverse effect on Mexico’s economic situation and, in turn, on our business, results of operations, financial condition and ability to repay our indebtedness.

Adverse domestic events could negatively impact the Company’s business and results of operations.

The operations of our airports may be disrupted due to the actions of third parties, such as protestors or demonstrators, which are beyond our control. The new Mexican president took office on December 1, 2018 and any actions taken by the new administration or the opposition may lead to riots, protests, demonstrations and looting that could adversely affect our revenues and security at out airports and could restrict our ability to expand our operations. Any disruption in our operations, or adverse consequence resulting from protests or riots, including flight delays, a work stoppage or other similar event, may have a material adverse effect on the operation of our airports and on our results of operations.

Demonstrations and riots taking place in cities where our airports are located and where they are either a potential target or in the path of such demonstrations could generate flight cancellations and the suspension of our

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operations and could materially and adversely affect our business, results of operations, prospects and financial condition.

Depreciation of the peso relative to the U.S. dollar could adversely affect the results of operations and financial condition of the Company.

Following the devaluation of the peso and the economic crisis beginning in 1994, the aggregate passenger traffic volume in the Company’s airports in 1995 (then operated by its predecessor) decreased as compared to prior years, reflecting a decrease in Mexican passenger traffic volume. From December 31, ~~2016 to December 31, 2017, the peso appreciated 4.7%, from Ps.20.62 per U.S.$1.00 on December 31, 2016, to Ps.19.64 per U.S.$1.00 on December 31, 2017. From December 31,~~ 2017 to December 31, 2018, the peso remained the same at Ps.19.64 per U.S.$1.00. ~~During the beginning of~~From December 31, 2018 to December 31, 2019, the peso ~~recovered,~~appreciated from Ps.19.64 per U.S.$1.00 on December 31, 2018 to Ps.18.86 per U.S.$1.00 on December 31, 2019, an appreciation of 3.9%. During the first months of 2020, the peso depreciated, reaching ~~Ps.18.77~~Ps.24.59 per U.S.$1.00 on April ~~19, 2019.~~22, 2020.

A depreciation of the peso affects the Company’s business in the following ways: (i) international passengers and international flights pay tariffs reported in U.S. dollars; while these tariffs are generally collected in Mexican pesos up to 60 days following the date of each flight, any depreciation of the Mexican peso has a positive impact on the Company’s results from operations, which are reported in Mexican pesos; (ii) the Company has cash balances denominated in U.S. dollars; a depreciation in the Mexican peso would result in higher cash balances when converted to Mexican pesos, thus causing foreign exchange gains; and ~~(ii)~~(iii) the Company has financial liabilities denominated in U.S. dollars; a depreciation in the Mexican peso results in higher debt balances when converted to Mexican pesos, thus causing foreign exchange losses. As of December 31, ~~2018,~~2019, the Company had U.S.$~~13.2~~10.1 million of liabilities denominated in U.S. dollars, representing ~~5.6%~~4.2% of its consolidated debt. As of March 31, 2020, U.S.$80.0 million of the Company’s cash balance was denominated in U.S. dollars.

Moreover, the depreciation of the peso also affects some of the Company’s airline customers transacting in U.S. dollars, including the purchases or leases of equipment, maintenance and fuel.

Severe devaluation or depreciation of the peso may also result in the disruption of the international foreign exchange markets and may limit the Company’s ability to transfer or to convert pesos into U.S. dollars and other currencies.

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High incidences of crime in Mexico, including extortion and drug trafficking, could adversely affect the Company’s business.

Higher incidences of crime throughout Mexico, including extortion and drug trafficking, could have an adverse effect on our business, results of operations, prospects and financial condition, as it may decrease the international and domestic passenger traffic directed to or within Mexico. The travel warning issued by the U.S. Department of State (Bureau of Consular Affairs) on ~~November 15, 2018~~December 17, 2019 (the “Travel Advisory”) urges U.S. citizens not to travel to the states of Colima, Tamaulipas, Guerrero, Michoacán, and Sinaloa (except the city of Mazatlán). This Travel Advisory also urges U.S. citizens to defer non-essential travel to cities, states and other regions, such as Chihuahua, Coahuila, ~~areas of the state of~~Durango, Jalisco, ~~that border the states of Michoacán, the eastern edge of Sonora, which borders the state of Chihuahua, Durango,~~Mexico State, Morelos, Nayarit, Nuevo León, ~~(including the metropolitan area of Monterrey),~~ San Luis Potosí, Sonora and ~~Zacatecas, among others.~~Zacatecas. Drug‑related violence and other incidents of organized crime may not be contained, which could have a material adverse effect on our business, results of operations, prospects and financial condition.

In January 2019, the Mexican government implemented measures to reduce the theft of fuel transported in pipelines operated by Mexican state-owned entity ~~Petroleos~~Petróleos Mexicanos (PEMEX) throughout Mexico. As a result of these measures, certain states in Mexico, such as Mexico, Hidalgo, Querétaro, Guanajuato, Jalisco, Tamaulipas and Nuevo León, ~~have been~~were affected by a shortage of gasoline for automobile ~~use as of the date of this report. While~~use. Even though there ~~have been~~were no shortages of aircraft fuel as a result of the actions implemented by the Mexican government, we cannot assure that future actions taken by the Mexican government against theft of fuel will not affect the availability of aircraft fuel in states where our airports are located, which, in turn, could have an adverse effect on our operations.

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The value and prices of securities issued by Mexican companies, including us, may be adversely affected by developments in other countries.

The market value of securities of Mexican companies, including us, may be, to varying degrees, affected by economic and market conditions in other countries. Although economic conditions in these countries may differ significantly from economic conditions in Mexico, investors’ reactions to developments in any of these other countries may have an adverse effect on the market value of securities of Mexican issuers. In past years, prices of both Mexican debt and equity securities have been adversely affected by the sharp drop in Asian securities markets and the economic crises in Argentina, Brazil, Greece, Italy, Portugal, Russia, Spain, Venezuela and the United Arab Emirates.

In addition, economic conditions in Mexico have become increasingly correlated to economic conditions in the United States. Therefore, an economic downturn in the United States will significantly adversely impact the Mexican economy. The Company cannot assure you that any policies adopted by the U.S. administration will not have an impact in the market value of its securities, or that the market value of its securities will not be adversely affected by events elsewhere.

Delays in the process of obtaining necessary governmental approvals could affect the ability to expand the airports of the Company.

The expansion, development and growth of the Company’s airports from time to time may require governmental approvals, administrative proceedings or some other governmental action. Any delay or inability to obtain such approvals or favorable outcomes of such proceedings could have a negative impact on the expansion, development and growth of the Company’s airports.

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Mexico’s environmental legislation could limit the growth of some of our airports.

The level of environmental regulation in Mexico is increasing and the enforcement of environmental laws has become more common. For instance, Mexico launched a new carbon dioxide (“CO2”) market in 2018. The market requires that industries that generate above a certain amount of CO2 emissions pay for rights to excess emissions. Starting in 2019, the legislation also requires that companies report their global emissions as verified by the Mexican Emissions Registry (Registro Nacional de Emisiones). In addition, new water quality standards are being discussed, which would require greater water quality for all of our wastewater disposal. There can be no assurance that environmental regulations or their enforcement will not change in a manner that could have a material adverse effect on our business, results of operations, prospects or financial condition.

According to the Mexican Ministry of the Environment and Natural Resources (Secretaría de Medio Ambiente y Recursos Naturales) norm NOM‑SEMARNAT‑059‑2010, mangroves are protected species, and it is a criminal offense to remove such species. Within the grounds of our Acapulco and Zihuatanejo airports, we have extended areas with mangroves, which may limit our potential to expand such airports.

The Mexican National Water Commission (Comisión Nacional del Agua) has the authority to restrict water use in some of our airports due to water shortage in northern Mexico and has enhanced its mechanisms to verify compliance with the fiscal, administrative and technical requirements regarding the extraction and discharge of water. Concessionaires who fail to comply with any of these requirements may be subject to administrative procedures that may result in the cancellation of water extraction rights and /or the imposition of significant fines.

Furthermore, twelve of our airports have received the Environmental Quality Certification awarded by the Federal Office for the Protection of the Environment (Procuraduría Federal de Protección al Ambiente). The rest of our airports are in the process of obtaining this certification, which we expect to receive in 2020. However, compliance with current or future environmental regulations may require us to incur additional costs in order to bring our airports into compliance, and if we fail to comply with current or future environmental regulations, we may be subject to fines and other sanctions.

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Hidrocarburos, or “ASEA”) was created. While initially taking a secondary role to the role of the Mexican Ministry of the Environment and Natural Resources, ASEA has recently started to enforce its legal powers. Our airport growth projects related to fuel supply must now be approved by ASEA, which may result in more burdensome proceedings for the approval of special projects related to hydrocarbons. As of the date of this report, there can be no assurance whether ASEA’s rules and regulations will materially affect our business or results of operations.

Minority shareholders may be less able to enforce their rights against the Company, its directors or controlling shareholders in Mexico.

Under Mexican law, the protections afforded to minority shareholders are different from those afforded to minority shareholders in the United States. For example, there are no precedent cases in which Mexican courts found that the directors violated their fiduciary duties. As a result, it may be difficult for minority shareholders to bring an action against directors for breach of these duties and achieve the same results as in most jurisdictions in the United States. Procedures for class‑action lawsuits were incorporated into Mexican law and became effective in March 2012. However, these rules and procedures are different and more limited than those in place in the United States. Therefore, it may be more difficult for minority shareholders to enforce their rights against the Company, its directors or its controlling shareholders.

Enforcing civil liabilities against us or our directors, officers and controlling persons may be difficult.

We are organized under the laws of Mexico, and almost all of our directors, officers and controlling persons reside in Mexico. In addition, a substantial portion of our assets and the assets of our directors, officers and controlling persons are located in Mexico. As a result, it may be difficult for investors to effect service of process on such persons within the United States or elsewhere outside of Mexico or to enforce judgments against us or our directors, officers and controlling persons, including in any action based on civil liabilities under U.S. federal securities laws. There is doubt as to the enforceability in Mexico, whether in original actions or in actions to enforce judgments of U.S. courts or other courts outside of Mexico, of liabilities based solely on U.S. federal securities laws.

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Mexican law and the bylaws of the Company restrict the ability of non-Mexican shareholders to invoke the protection of their governments with respect to their rights as shareholders.

As required by Mexican law, the Company’s bylaws provide that non‑Mexican shareholders shall be considered as Mexicans in respect of their ownership interests in the Company and shall be deemed to have agreed not to invoke the protection of their governments in certain circumstances. Under this provision, a non‑Mexican shareholder is deemed to have agreed not to invoke the protection of his own government by asking such government to interpose a diplomatic claim against the Mexican government with respect to the shareholder’s rights as a shareholder, but is not deemed to have waived any other rights it may have, including any rights under the U.S. securities laws, with respect to its investment in the Company. If you invoke such governmental protection in violation of this agreement, your shares could be forfeited to the Mexican government.

The Company is subject to different corporate disclosure standards than U.S. companies.

A principal objective of the securities laws of the United States is to promote full and fair disclosure of all material corporate information. However, there may be less publicly available information about foreign issuers of securities listed in the United States than is regularly published by or about U.S. issuers of listed securities.

Risks Related to Our Shareholders

~~Controladora de Operaciones de Infraestructura, S.A. de C.V. (“CONOISA”) and~~ SETA ~~control~~controls our management, and ~~their~~its interests may differ from those of other shareholders.

As of the date of this report, ~~CONOISA~~ICA Tenedora, S.A. de C.V. (“ICATEN”) through its direct subsidiary SETA, is the beneficial owner of ~~14.5%~~14.7% of our total capital stock. ~~CONOISA~~SETA directly owns Series B shares representing 1.9% of our total capital stock and ~~Series A shares of SETA representing 99.99% of its capital stock (0.01% owned by ICA Infraestructura, S.A. de C.V.) . SETA in turn~~ owns Series BB shares that represent ~~12.6%~~12.8% of our capital stock. SETA is a direct subsidiary of CONOISA and CONOISA in turn is a direct subsidiary of ICA Tenedora, S.A. de C.V. (“ICATEN”). Pursuant to our bylaws, SETA (as holder of our Series BB shares) has the right to present to our Board of Directors the name or names of the candidates for appointment as our chief executive officer, to appoint and remove half of our executive officers and to elect three members of our Board of Directors. SETA, as holder of our Series BB shares, also has the right, pursuant to our bylaws, to veto certain actions requiring approval of our shareholders (including the payment of dividends, the amendment of our bylaws, investment projects and the amendment of its right to appoint certain members of our senior management). Additionally, most matters voted on by our Board of Directors require the affirmative vote of the directors appointed by our Series BB shareholders. If, at any time after June 14, 2015, SETA were to hold less than 7.65% of our capital stock in the form of Series BB shares, such shares must be converted into Series B shares, which would cause SETA to lose all of its special rights. As long as SETA retains at least 7.65% of our capital stock in the form of Series BB, all of its special rights, including its right to nominate, appoint and remove certain directors and officers as holder of Series BB shares, will remain in place. The rights and obligations of

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SETA in our management are explained in “Item 7. Major Shareholders and Related Party Transactions—Major Shareholders.”

The termination of the Technical Assistance Agreement would also trigger the conversion of SETA’s remaining Series BB shares into Series B shares, resulting in the termination of all of SETA’s special rights. So long as the Technical Assistance Agreement remains in effect and SETA continues to hold any Series BB shares, it also has the obligation to appoint and nominate the same directors and officers that it currently is entitled to appoint under our bylaws. The Technical Assistance Agreement sets forth certain qualifications that members of our management appointed by them must have. The Technical Assistance Agreement was extended for a term that ends on December 31, 2020 and will be automatically extended for successive one year periods, unless any party thereto elects otherwise, so long as CONOISA retains at least 12.75% of SETA’s capital. For further information on the Technical Assistance Agreement and its terms, see “Item 7. Major Shareholders and Related Party Transactions—Related Party Transactions—Arrangements Relating to SETA.”

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SETA’s continuing veto rights as holder of at least 7.65% of our capital stock in the form of Series BB shares and its right to nominate, appoint and remove certain directors and officers as holder of Series BB shares, which will continue for as long as it owns at least one Series BB share and the Technical Assistance Agreement remains in effect, could adversely impact our operations and constitute an obstacle for us to bring in a new strategic shareholder and/or operator. With the right to nominate, appoint and remove certain members of our senior management, SETA directs the actions of our management in areas such as business strategy, financing, distributions, acquisitions and dispositions of assets or businesses. Should SETA’s shares fall below this threshold, our management could change significantly, and our operations could be adversely affected as a result. In the event of termination of the Technical Assistance Agreement, SETA would cease to have the special rights of the Series BB shares, which may adversely affect and disrupt our operations.

Furthermore, in connection with a corporate and debt restructuring carried out by Empresas ICA, ICATEN was incorporated on March 14, 2017 and Empresas ICA transferred all the shares of its direct subsidiaries, including ~~CONOISA’s~~those of Controladora de Operaciones de Infraestructura S.A. de C.V. (“CONOISA”) a direct subsidiary of ICATEN (which until December 2019 owned 99.99% of SETA’s capital stock) and indirectly ours, to ICATEN. On August 25, 2017, Empresas ICA and certain of its subsidiaries, including ICATEN and CONOISA, filed a joint prepackaged concurso mercantil plan (the “ICA Concurso Plan”) with the competent bankruptcy court of Mexico. Pursuant to the ICA Concurso Plan, all of the filing entities’ recognized unsecured debt was discharged and paid with shares representing up to 99.99% of ICATEN’s capital stock, resulting in a change in our indirect holding structure. On March 1, 2018, the competent bankruptcy court of Mexico approved the ICA Concurso Plan; the relevant judgment was published on March 2, 2018 and became effective as of March 23, 2018.

The interests of SETA, ~~and CONOISA,~~ or any new controlling shareholder of ICATEN, may differ from those of our other shareholders and can be contrary to the preferences and expectations of our other shareholders. SETA and ~~CONOISA and~~ the officers nominated or appointed by ~~them~~it may not exercise their rights in ways that favor the interests of our other shareholders. Furthermore, as a result of our board’s decision-making process, officers appointed by SETA ~~and CONOISA~~ may influence decisions taken by the rest of our officers.

~~If SETA, one of our principal shareholders, should sell or otherwise transfer all or a portion of our Series BB shares that it holds, our operations could be adversely affected.~~

SETA currently exercises a substantial influence over our management, as described above. SETA, as holder of the Series BB shares, is entitled to present to the Board of Directors the name or names of the candidates for appointment as our chief executive officer, to appoint and remove half of our executive officers, which currently includes our chief financial officer, our chief operating officer and our commercial director, and to elect three of our board members. Elimination of these rights from our bylaws would require the consent of SETA, as long as it owns Series BB shares representing at least 7.65% of our capital stock. Should SETA’s shares fall below this threshold, our management could change significantly, and our operations could be adversely affected as a result. In the event of termination of the Technical Assistance Agreement, SETA would cease to have the special rights of the Series BB shares, which may adversely affect and disrupt our operations.

Risks Related to Our ADSs

You may not be entitled to participate in future preemptive rights offerings.

Under Mexican law, if we issue new shares for cash as part of a capital increase, we generally must grant our shareholders the right to purchase a sufficient number of shares to maintain their existing ownership percentage in the Company. Rights to purchase shares in these circumstances are known as preemptive rights. We may not legally be permitted to allow holders of ADSs in the United States to exercise any preemptive rights in any future capital increase, unless we file a registration statement with the SEC with respect to that future issuance of shares or the offering qualifies for an exemption from the registration requirements of the Securities Act of 1933, as amended.

At the time of any future capital increase, we will evaluate the costs and potential liabilities associated with filing a registration statement with the SEC and any other factors that we consider important to determine whether we will file such a registration statement.

We may not file a registration statement with the SEC in the future to allow holders of ADSs or shares in the United States to participate in a preemptive rights offering. In addition, under current Mexican law, sales by the

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depository of preemptive rights and distribution of the proceeds from such sales to you, the ADS holders, is not possible. As a result, your equity interest in the Company may be diluted proportionately.

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Holders of ADSs are not entitled to attend shareholders’ meetings, and they may only vote through the depositary.

Under Mexican law, a shareholder is required to deposit its shares with the Secretary of the Company, S.D. Indeval Institución para el Depósito de Valores, S.A. de C.V. (“Indeval”), a Mexican or foreign credit institution or a brokerage house in order to attend a shareholders’ meeting. A holder of ADSs will not be able to meet this requirement, and accordingly is not entitled to attend shareholders’ meetings. A holder of ADSs is entitled to instruct the depositary as to how to vote the shares represented by ADSs, in accordance with the procedures provided for in the deposit agreement, but a holder of ADSs will not be able to vote its shares directly at a shareholders’ meeting or to appoint a proxy to do so.

FORWARD-LOOKING STATEMENTS

This Form 20-F contains forward-looking statements. We may from time to time make forward-looking statements in our annual and periodic reports to the SEC on Forms 20-F and 6-K, in our annual report to shareholders, in offering circulars and prospectuses, in press releases and other written materials and in oral statements made by our officers, directors or employees to analysts, institutional investors, representatives of the media and others. Examples of such forward-looking statements ~~include:~~include but are not limited to:

projections of operating revenues, net comprehensive income (loss), net income (loss) per share, capital expenditures, dividends, capital structure or other financial items or ratios,

statements of our plans, objectives or goals,

changes in our regulatory environment,

statements about our future economic performance or that of Mexico, and

statements of assumptions underlying such statements.

Words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “should” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from the projections, plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors, some of which are discussed above under “Risk Factors,” include material changes in the performance or terms of our concessions, developments in legal proceedings, economic and political conditions and government policies in Mexico or elsewhere, inflation rates, exchange rates, regulatory developments, customer demand and competition. We caution you that the foregoing list of factors is not exclusive and that other risks and uncertainties may cause actual results to differ materially from those in forward-looking statements.

Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments.

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Item 4. Information on the Company

HISTORY AND DEVELOPMENT OF THE COMPANY

Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., which we refer to by the acronym “GACN”, is a corporation (sociedad anónima bursátil de capital variable) organized under the laws of Mexico. We were incorporated in 1998 as part of the Mexican government’s program for the opening of Mexico’s airports to private investment. The duration of our corporate existence is indefinite. We are a holding company and conduct substantially all of our operations through our subsidiaries. The terms “GACN”, “the Company”, “we”, “us” and “our” in this annual report refer to Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., together with its subsidiaries, and to properties and assets that we own or operate, unless otherwise specified. Our registered office is located at ~~Torre Latitud, L501,~~Plaza Metrópoli Patriotismo, Piso 5, Av. ~~Lázaro Cárdenas 2225,~~Patriotismo 201, Col. ~~Valle Oriente,~~ San Pedro ~~Garza García, Nuevo León, Mexico,~~de los Pinos, Benito Juárez, Ciudad de México, México, telephone +52.81.8625.4300. Our U.S. agent is Puglisi & Associates. Our U.S. agent’s address is 850 Library Avenue, Suite 204, Newark, Delaware 19711.

The SEC maintains a World Wide Web site on the Internet at http://www.sec.gov that contains reports and information statements and other information regarding us. The reports and information statements and other information about us can also be downloaded from the SEC’s website or our website at http://www.oma.aero.

Investment by SETA and Its Affiliates

In 2000, as part of the first stage of our privatization, the Mexican government sold Series BB shares to SETA in a public bidding process. Pursuant to this transaction, SETA paid the Mexican government a total of Ps.864,055,578 (amount in nominal pesos, excluding interest) (U.S.$76.0 million based on the exchange rate in effect on the date of SETA’s bid) in exchange for:

all of our Series BB shares, which in 2000 represented 15.0% of our outstanding capital stock;

an option to acquire from the Mexican government shares representing 36.0% of the capital stock in 2000. This option was subsequently assigned to and exercised by Aeroinvest (currently CONOISA)~~, a principal shareholder of SETA;~~;

an option to subscribe for up to 3% of newly issued Series B shares (1% of which expired unexercised on June 14, 2005, and 2% of which was exercised in September 2006); and

the right and obligation to enter into various agreements with us and the Mexican government, including a participation agreement setting forth the rights and obligations of each of the parties involved in the privatization (including SETA) (the “Participation Agreement”), a 15‑year Technical Assistance Agreement setting forth SETA’s right and obligation to provide technical assistance to us in exchange for an annual fee and a shareholders’ agreement under terms established during the public bidding process. These agreements are described in greater detail under “Item 7. Major Shareholders and Related‑Party Transactions.”

Currently, Series BB shares represent ~~12.6%~~12.8% of our capital stock and the remainder consist of Series B shares.

SETA’s current shareholders are:

~~CONOISA,~~ ICATEN, which owns directly 99.9% of ~~SETA. CONOISA is a~~SETA, and ICA Infraestructura, S.A. de. C.V. (a subsidiary of ~~ICATEN. CONOISA~~ICATEN) owns the remainder share participation of SETA. SETA currently owns all of the outstanding Series BB shares representing 12.8% of our capital stock and also ~~directly~~ owns Series B shares representing 1.9% of our total capital stock.Based on data from the Mexican Chamber of the Construction Industry (Cámara Mexicana de la Industria de la Construcción) and the Mexican National Institute of Statistics and Geography, ICATEN ~~the parent of CONOISA,~~ is one of the largest engineering, procurement and construction companies in Mexico.

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ICATEN’s principal line of business is industrial and urban construction and is involved in the construction, maintenance and operation of highways, social infrastructure and tunnels and in the management and operation of water supply systems.

~~ICA Infraestructura, S.A. de C.V., which owns 0.01% of SETA and is a direct subsidiary of CONOISA.~~

Under the Technical Assistance Agreement, SETA provides management and consulting services and transfers industry expertise and technology to us in exchange for a fee, which in ~~2018~~2019 amounted to approximately ~~Ps.172,610~~Ps.150,108 thousand. This agreement is more fully described in “Item 7. Major Shareholders and Related‑Party Transactions.”

Initial Public Offering

On November 29, 2006, a Mexican trust established by Nacional Financiera, S.N.C., or NAFIN (a Mexican national credit institution and development bank owned and controlled by the Mexican Government), acting pursuant to the instructions of the Ministry of Communications and Transportation, sold 48.02% of our outstanding capital stock through a global public offering of shares in the form of ADSs and Series B shares, concurrently in the United States and Mexico. The net proceeds from the sale of the shares totaled approximately U.S.$432.2 million and were paid to the Mexican government.

Master Development Programs and Capital Expenditures

Master Development Program

Every five years, we are required to submit to the Ministry of Communications and Transportation for approval a master development program for each of our concessions describing, among other matters, our traffic forecasts for the following 15 years, and detailed expansion, modernization and major and minor maintenance plans for the following five years. Each master development program is required to be updated and resubmitted for approval to the Ministry of Communications and Transportation every five years. Upon such approval, the master development program is binding for the following five years and deemed to constitute part of the relevant concession. Any major construction, renovation or expansion of an airport generally may only be made pursuant to a concession holder’s master development program and upon approval by the Ministry of Communications and Transportation. In December 2015, the Ministry of Communications and Transportation approved the master development programs for each of our subsidiary concession holders for the 2016 to 2020 period. These five‑year master development programs ~~will be~~are in effect from January 1, 2016 until December 31, 2020, and we ~~will be~~are required to comply with them on a year‑by‑year basis. We will submit the new master development program to the Ministry of Communications and Transportation in 2020, which upon approval would be in effect from January 1, 2021 to December 31, 2025. We do not expect the COVID-19 pandemic to affect our committed investments under the current master development programs, which are in effect until December 31, 2020.

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The following table sets forth our current committed investments under our master development programs by airport for 2016 through 2020:

Committed Investments Under Master Development Programs by

Airport for 2016 through 2020 (1)


	For the Year Ended December 31,						For the Year Ended December 31,
						Total						Total
	2016	2017	2018	2019	2020	2016 - 2020	2016	2017	2018	2019	2020	2016 - 2020
	(in thousands of pesos)						(in thousands of pesos)
Acapulco	302,283	256,683	176,320	40,762	10,811	786,859	302,123	255,946	176,228	40,740	10,806	785,842
Ciudad Juárez	53,700	18,421	30,685	94,846	20,981	218,633	53,671	18,411	30,669	94,797	20,971	218,519
Culiacán	53,260	38,728	36,791	65,530	65,042	259,351	53,231	38,708	36,772	65,496	65,008	259,215
Chihuahua	235,494	192,711	23,618	118,180	25,206	595,209	235,370	192,610	23,605	118,118	25,193	594,895
Durango	41,456	24,733	28,467	88,436	3,227	186,319	41,434	24,721	28,452	88,389	3,226	186,221
Mazatlán	34,672	43,664	42,517	32,521	14,037	167,411	34,655	43,640	42,494	32,505	14,030	167,324
Monterrey	463,838	438,175	452,865	237,839	115,220	1,707,937	463,593	437,943	452,626	237,714	115,761	1,707,637
Reynosa	232,490	191,144	22,219	12,035	11,250	469,138	232,367	191,044	22,208	12,028	11,245	468,891
San Luis Potosí	41,818	225,458	225,147	19,842	2,515	514,780	41,795	225,338	225,028	19,831	2,514	514,507
Tampico	79,070	131,238	147,280	15,919	18,501	392,008	79,028	131,169	147,202	15,911	18,491	391,800
Torreón	42,226	27,634	19,439	21,116	65,086	175,501	42,204	27,619	19,428	21,106	65,052	175,409
Zacatecas	36,077	10,937	41,271	7,812	32,076	128,173	36,058	10,932	41,250	7,808	32,059	128,106
Zihuatanejo	133,131	78,570	29,562	29,650	130,397	401,310	133,060	78,529	29,546	29,634	130,328	401,097
Total	1,749,515	1,678,096	1,276,181	784,488	514,349	6,002,629	1,748,589	1,676,610	1,275,507	784,076	514,682	5,999,465

(1)

In pesos with purchasing power as of December ~~2018.~~2019.

The following table sets forth our current committed investments under our master development programs by category for 2016 through 2020:

Committed Investments Under Master Development Programs by

Category for 2016 through 2020 (1)


	For the Year Ended December 31,						For the Year Ended December 31,
						Total						Total
	2016	2017	2018	2019	2020	2016 - 2020	2016	2017	2018	2019	2020	2016 - 2020
	(in thousands of pesos)						(in thousands of pesos)
Capacity and quality projects Terminals	803,834	1,165,596	781,287	362,119	176,754	3,289,591	876,893	1,208,865	854,753	431,746	190,361	3,562,617
Projects to meet ICAO directives	80,022	90,447	28,060	16,707	9,844	225,079	156,060	135,185	45,754	61,617	35,919	434,535
Facilities for disabled passengers	6,637	5,005	1,479	3,478	660	17,260	6,632	5,002	1,478	3,477	660	17,249
Environmental projects	38,755	8,686	5,118	3,591	1,824	57,975	38,942	8,681	6,216	3,589	1,822	59,249
Projects requested by competent authorities	5,735	1,240	20,636	33,217	—	60,827	3,668	1,239	20,626	33,202	—	58,734
Runways and aprons	92,013	63,752	16,808	12,681	4,718	189,973	183,374	81,975	133,183	150,334	121,728	670,594
Machinery and equipment	187,096	87,437	146,459	157,422	121,191	699,604	27,548	4,479	9,832	7,813	5,194	54,866
Operative standards equipment	205,197	113,317	93,568	117,756	45,490	575,329	121,867	46,586	22,020	19,892	13,191	223,557
Security — investments	105,736	40,815	19,846	19,904	13,198	199,499	45,244	47,285	33,183	44,281	27,906	197,898
Information systems — investments	45,268	47,310	33,198	44,304	27,920	198,000	99,661	38,514	108,059	8,256	3,711	258,201
Baggage-screening system — investments	99,714	38,535	108,116	8,260	3,713	258,338	79,477	15,352	21,585	5,049	108,976	230,439
Other	79,508	15,956	21,606	5,049	109,036	231,154	109,225	83,448	18,819	14,820	5,213	231,526
Total	1,749,515	1,678,096	1,276,181	784,488	514,349	6,002,629	1,748,589	1,676,610	1,275,507	784,076	514,682	5,999,465

(1)

In pesos with purchasing power as of December ~~2018.~~2019.

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Expenditures Under the Master Development Programs and Other Strategic Capital Expenditures

Expenditures incurred to comply with our obligations under the master development programs include expenditures associated with improvements to our concession assets, major maintenance costs and other items recorded as operating costs as incurred. Major maintenance expenditures are not subject to capitalization and reduce our major maintenance provision. See “Item 5. Operating and Financial Review and Prospects—Critical Accounting Policies—Major Maintenance Provision.” Thus, not all expenditures incurred to comply with our obligations under the master development programs will constitute capital expenditures.

In addition to investments in our master development programs, we have also invested in commercial, real estate and other business opportunities, including our investment in hotels in Terminal 2 of the Mexico City International Airport and in the Monterrey airport, as well as our industrial park in the Monterrey airport.

The following table sets forth our actual capital expenditures, including capital expenditures made pursuant to our master development programs and other strategic capital expenditures by airport for 2016 through ~~2018:~~2019:

Actual Capital Expenditures by Airport for 2016 through ~~2018~~2019


	For the Year Ended December 31,			For the Year Ended December 31,
	2016	2017	2018	2016	2017	2018	2019
	(in thousands of pesos)			(in thousands of pesos)
Acapulco	77,069	372,253	279,099	77,069	372,253	279,099	12,221
Ciudad Juárez	10,005	33,404	9,096	10,005	33,404	9,096	29,839
Culiacán	9,896	44,389	34,035	9,896	44,389	34,035	65,480
Chihuahua	16,202	122,448	141,908	16,202	122,448	141,908	173,576
Durango	4,478	19,991	13,788	4,478	19,991	13,788	48,932
Mazatlán	19,632	30,222	31,306	19,632	30,222	31,306	37,812
Monterrey	98,585	505,445	282,514	98,585	505,445	282,514	244,038
Reynosa	23,944	127,353	153,562	23,944	127,353	153,562	63,443
San Luis Potosí	24,553	108,757	231,726	24,553	108,757	231,726	71,716
Tampico	32,157	46,742	26,169	32,157	46,742	26,169	111,210
Torreón	5,834	20,017	19,990	5,834	20,017	19,990	9,105
Zacatecas	7,789	19,174	9,656	7,789	19,174	9,656	17,555
Zihuatanejo	25,822	28,138	13,587	25,822	28,138	13,587	105,374
Other	173,427	103,626	67,927	173,427	103,626	67,927	58,625
Total	529,393	1,581,959	1,314,363	529,393	1,581,959	1,314,363	1,048,926

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The following table sets forth our actual capital expenditures by category across all of our airports for 2016, 2017, 2018 and ~~2018:~~2019:

Actual Capital Expenditures by Category for 2016 through ~~2018~~2019


	For the Year Ended			For the Year Ended
	December 31,			December 31,
	2016	2017	2018	2016	2017	2018	2019
	(in thousands of pesos)			(in thousands of pesos)
Capacity and quality project	140,989	882,289	961,580	140,989	882,289	961,580	598,829
Projects to meet ICAO directives	13,412	113,561	71,813	13,412	113,561	71,813	52,345
Facilities for disabled passengers	820	628	7,289	820	628	7,289	—
Environmental projects	6,616	12,429	6,655	6,616	12,429	6,655	3,350
Projects requested by competent authorities	2,283	8,216	4,126	2,283	8,216	4,126	692
Runways and aprons	307,768	313,707	174,746	12,552	1,735	—	220,647
Machinery and equipment	12,552	1,735	—	11,657	2,863	—	15,413
Operative standards equipment	11,657	2,863	—	19,669	78,735	25,804	10,027
Security — investments	19,669	78,735	25,804	7,287	27,309	6,074	17,305
Information systems — investments	7,287	27,309	6,074	5,565	58,545	43,738	16,972
Baggage-screening system — investments	5,565	58,545	43,738	775	81,942	12,538	820
Other	775	81,942	12,538	307,768	313,707	174,746	112,527
Total	529,393	1,581,959	1,314,363	529,393	1,581,959	1,314,363	1,048,926

For the year ended December 31, ~~2018,~~2019, our capital expenditures totaled ~~Ps.1,314,363~~Ps.1,048,926 thousand. ~~2018~~2019 was the ~~third~~fourth year of the 2016-2020 Master Development Program, and we continue implementing all of the projects to which we committed at the end of 2015. As a result, our capital expenditures for ~~2018~~2019 were dedicated primarily to our committed investments pursuant to our master development programs. See “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources—Principal Uses of Capital” for a further discussion on our actual expenditures made during ~~2016,~~ 2017, 2018 and ~~2018~~2019 and their classification in our consolidated financial statements for such periods.

Our capital expenditures from ~~2016~~2017 through ~~2018~~2019 were allocated to the following types of investments at the majority of our airports:

Terminals. We started the construction of ~~two new terminal buildings and~~ four building expansions, and we completed the construction of two ~~of which~~expansion projects ~~were completed~~ in ~~2018.~~2019. We also improved our airports’ terminals by, among others, updating our lighting and air conditioning systems, replacing our fire detection and suppression equipment, installing new elevators and escalators and upgrading our public information systems. ~~We also finished the design for the terminal building improvements of the Zihuatanejo airport and construction is expected to commence in 2019.~~

Paved surfaces. We performed major rehabilitation work on our runways, taxiways and service roads to meet ICAO standards, including the modernization of our illuminated navigation aid systems to improve the safety of our airports. We expanded several aircraft aprons for general and commercial aviation, particularly at the Monterrey airport. We also completed construction of ~~a new taxiway~~two taxiways at each of the Culiacan airport and Monterrey airport, two new car rental facilities at each of the Monterrey and Acapulco ~~airports.~~airports, and an expansion of the Chihuahua Airport parking lot. We also began the construction of a new parking lot at Ciudad Juarez airport.

Machinery and equipment. We invested in machinery and equipment such as aircraft‑approved fire‑extinguishing vehicles, emergency back‑up electricity generators, metal detectors and other security‑related equipment. We purchased operational and passenger ground vehicles and completed construction of a new power main substation at the Acapulco airport. We also began the construction of a new electrical substation at the Monterrey airport.

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Baggage‑screening system – investments. We updated the screening equipment in ~~five~~six of our airports to facilitate compliance with the new baggage‑screening guidelines that require a comprehensive screening process for the detection of explosives.

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OMA‑VYNMSA Industrial Park at the Monterrey airport. We continued with the expansion of our OMA‑VYNMSA industrial park located at the Monterrey airport. As of December 31, ~~2018~~2019 we had a total construction of 78 warehouses with a total leasable area of ~~45,254~~54,107 square meters ~~(487,110-square-feet)~~(582,209 square feet), of which 67 warehouses have already been leased and are currently in operation. The current total leased area of the industrial park is ~~40,254~~53,442 square meters ~~(433,290-square-feet)~~(575,244 square feet) with lease terms ranging from 40 to 84144 months. ~~As of the date of this report, we have one~~Two new lease contracts were signed in December 2019. One contract is related to a 4,945 square-meter (53,228 square-feet) warehouse and will start revenue generation in 2020. The second contract relates to a ~~4,080~~new 4,945 square-meter ~~(43,917~~(53,228 square-feet) ~~expansion under construction. One of our existing warehouses and the warehouse~~facility, which is currently under construction, ~~are already~~and will also start generating revenues in ~~process of commercialization.~~2020.

OMA Carga at the Monterrey airport. We invested in the construction of a new OMA Carga bonded warehouse in the Monterrey airport with a surface of 1,650 square meters (17,760 square feet), which doubled OMA Carga’s operating capacity. This ~~new~~ facility started operations in February 2017.

BUSINESS OVERVIEW

Our Operations

Through our subsidiaries, we hold concessions to operate, maintain and develop 13 airports in Mexico, which are concentrated in the country’s central and northern regions. Each of our concessions has a term of 50 years beginning on November 1, 1998. The term of each of our concessions may be extended by the Ministry of Communications and Transportation under certain circumstances for up to 50 additional years. The terms of our concessions also include the right to occupy, use and improve the land appurtenant to our airports, which we do not own and which will revert to the Mexican government upon the termination of our concession. As operator of the 13 airports under our concessions, we charge fees to airlines, passengers and other users for the use of the airports’ facilities. We also derive rental and other income from commercial and diversification activities conducted at our airports, such as the leasing of space to restaurants and retailers, the operation of parking facilities, the operation of the Terminal 2 NH Collection Hotel and the Hilton Garden Inn Hotel at the Monterrey airport, among others.

We operate 13 airports, which serve a major metropolitan area (Monterrey), three tourist destinations (Acapulco, Mazatlán and Zihuatanejo), seven regional centers (Chihuahua, Culiacán, Durango, San Luis Potosí, Tampico, Torreón and Zacatecas) and two border cities (Ciudad Juárez and Reynosa). Our airports are located in nine of the 32 Mexican states, covering a territory of approximately 926,421 square kilometers (575,667 square miles), with a population of approximately 27.6 million according to the Mexican National Institute of Statistics and Geography. All of our airports are designated as international airports under Mexican law, meaning that they are all equipped to receive international flights and to maintain customs and immigration services managed by the Mexican government, as well as refueling services.

According to figures published by the ~~Mexican Bureau of Civil Aviation,~~AFAC, our total aviation passenger traffic accounted for approximately ~~14.5%~~14.7% of all arriving and departing total aviation passengers in Mexico in ~~2018.~~2019.

In ~~2018,~~2019, we recorded revenues of ~~Ps.7,907,054~~Ps.8,527,101 thousand (U.S.$~~402,259~~451,822 thousand) and consolidated net income of ~~Ps.2,864~~Ps.3,227,434 thousand (U.S.$~~145,711~~171,011 thousand), the sum of our aeronautical and non‑aeronautical revenues was ~~Ps.6,765,549~~Ps.7,572,267 thousand (U.S.$~~344,187~~401,229 thousand) and our airports handled approximately ~~21.6~~23.2 million terminal passengers, an increase of ~~9.7%~~7.4% with respect to the ~~19.7~~21.6 million terminal passengers handled in ~~2017.~~2018.

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Our airports serve several major international routes, including ~~Monterrey‑Houston, Monterrey‑Dallas, Monterrey‑Atlanta, Monterrey‑Detroit,~~Monterrey-Houston, Monterrey-Dallas, Monterrey-Atlanta, Monterrey-Detroit, Monterrey-Las Vegas, San Luis Potosí-Dallas, Mazatlán-Los Angeles Monterrey-Chicago, San Luis Potosí~~-Dallas, Mazatlán‑Los Angeles~~-Houston, and ~~Zihuatanejo‑Los~~Zihuatanejo-Los Angeles. Our airports also serve several other major international destinations, including Houston, Dallas, Los Angeles, Chicago, Atlanta, Detroit, Las Vegas, Phoenix, ~~Minneapolis,~~New York, and San Antonio in the United States, Panama City, Havana, Cuba, ~~Seoul, South Korea,~~ and ~~Punta Cana, Dominican Republic.~~Varadero, Cuba. In addition, our airports serve major resort destinations, such as Acapulco, Mazatlán and Zihuatanejo, which are popular destinations in Mexico frequented by tourists from Mexico, the United States and Canada. Our airports also serve major domestic routes, including Monterrey‑Mexico City, which was the country’s busiest domestic route in ~~2018,~~2019, with approximately ~~3.6~~3.8 million total passengers (including passengers flying directly to the nearby airport of Toluca, which are counted together with those flying to Mexico City), according to the ~~Mexican Bureau of Civil Aviation.~~AFAC. Other major domestic routes served by our airports include Cancún‑Monterrey, Tijuana-Culiacán and Guadalajara‑Monterrey, with approximately ~~1,322,307, 844,697~~1,411,144, 911,985 and ~~815,707~~847,874 total passengers, respectively, in ~~2018,~~2019, according to the ~~Mexican Bureau of Civil Aviation.~~AFAC.

Our international traffic in ~~2018~~2019 increased by ~~4.4%~~7.9% compared to ~~2017,~~2018, principally as a result of ~~Aeroméxico’s new Monterrey-Detroit~~VivaAerobus’ Monterrey-Houston route, United Airlines’ San Luis Potosí-Houston route, American Airlines’ Torreon-Dallas route, VivaAerobus’ ~~new Monterrey-Los~~Monterrey-Las Vegas route, Alaska Airlines’ Mazatlán-Los Angeles route, and ~~due to~~Volaris’ new ~~charter routes that started flying during 2018.~~Durango-Dallas route, American Airlines’ new Durango-Dallas route.

Monterrey and its metropolitan area is the third largest city in Mexico based on population, with a population of approximately 4.5 million. Monterrey ranks among Mexico’s most established urban and commercial centers and is the capital of the state of Nuevo León, Mexico’s eighth largest state based on population. It is home to many of Mexico’s largest companies in a wide variety of industries, as well as several major universities. Business travelers account for a substantial portion of passengers at the Monterrey airport. The airport is our leading airport based on passenger traffic volume, air traffic movements and contribution to revenues and ranked as the fourth busiest airport in Mexico based on passenger traffic volume in ~~2018,~~2019, according to data published by the ~~Mexican Bureau of Civil Aviation.~~AFAC. In ~~2018,~~2019, our Monterrey airport accounted for approximately ~~49.8~~48.2% of our terminal passenger traffic, ~~42.1~~43.3% of our total revenues and ~~45.8~~44.5% of the sum of our aeronautical and non‑aeronautical revenues.

Three of our airports, Acapulco, Mazatlán and Zihuatanejo, serve popular Mexican tourist destinations. Acapulco is Mexico’s 24th largest tourist destination, Mazatlán is the 1820th and Zihuatanejo is the 3231ndst, based on the number of international visitors in ~~2018~~2019 according to the ~~Mexican Bureau of Civil Aviation.~~AFAC. Acapulco is a principal port of call for cruise ships. In ~~2018,~~2019, the Acapulco, Mazatlán and Zihuatanejo airports collectively accounted for ~~10.9%~~11.5% of our aggregate terminal passengers, ~~13.3%~~11.5% of our total revenues and ~~10.8%~~11.4% of the sum of our aeronautical and non‑aeronautical revenues.

Seven of our airports serve small and mid‑sized cities that are important regional centers of economic activity, with ~~such~~ diverse economic activities such as mining (the Durango and Zacatecas airports), maquiladora manufacturing (the Chihuahua and Torreón airports), petroleum and chemical production (the Tampico airport), agriculture and livestock (the Culiacán airport) and transportation and logistics (the San Luis Potosí airport). In ~~2018,~~2019, these seven regional airports collectively accounted for ~~30.8%~~31.3% of our aggregate terminal passengers, ~~29.8%~~30.1% of our total revenues and ~~27.8%~~28.3% of the sum of our aeronautical and non‑aeronautical revenues.

The remaining two airports in the group, the Ciudad Juárez and Reynosa airports, serve cities situated along the border of Mexico and the United States. Both Ciudad Juárez and Reynosa are popular entry points to the United States. In ~~2018,~~2019, the Ciudad Juárez and Reynosa airports collectively accounted for ~~8.5%~~9.0% of our aggregate terminal passengers, ~~8.0%~~8.2% of our total revenues and ~~7.1%~~7.5% of the sum of our aeronautical and non‑aeronautical revenues.

In addition, we have ana 90% investment with a Mexican subsidiary of the international hotel operator NH Hoteles SA under Consorcio Grupo Hotelero T2, S.A. de C.V. to develop and operate a 287‑room hotel and more than 5,000 square meters (53,820 square feet) of commercial space inside Terminal 2 of Mexico City International Airport under a lease agreement (the “Lease”) with Mexico City International Airport that expires in 2029. The Terminal 2 NH Collection Hotel opened in August 2009. Under certain circumstances, the Mexico City International Airport can terminate the Lease at any time with partial or no compensation to us.

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In November 2012, as part of our diversification activities, we signed a strategic alliance agreement with VYNMSA Desarrollo Inmobiliario, S.A. de C.V. (“VYNMSA”), to build and operate an industrial park at the Monterrey airport. As part of this strategic alliance, 32.4 hectares ~~(0.13 square miles)~~(80.06 acres) within the Monterrey airport’s perimeter are being developed in phases for use as an industrial park. The industrial park was inaugurated on March 20, 2015, and as of December ~~2018~~2019 we had constructed a total ~~construction~~ of 78 warehouses with a total leasable area of ~~45,254~~54,107 square meters ~~(487,110-square-feet)~~(582,209 square feet), of which 67 warehouses have already been leased and are currently in operation. The current total leased area of the industrial park is ~~40,254~~53,442 square meters ~~(433,290-square-feet)~~(575,244 square feet) with lease terms ranging from 40 to 84144 months. Two new lease contracts were signed in December 2019. One contract is related to a 4,945 square-meter (53,228 square-foot) warehouse and will start generating revenue in 2020. The second contract relates to a new 4,945 square-meter (53,228 square-foot) facility, which is currently under construction, and will start generating revenues in 2020.

We also have an investment with Grupo Hotelero Santa Fe, S. de R.L. de C.V. (“Grupo Hotelero Santa Fe”), a Mexican hospitality investment and operating company, to develop and operate a 134‑room hotel at the Monterrey airport under the Hilton Garden Inn brand. The hotel started operations on August 27, 2015.

We consider our hotel operations and the operation of our industrial park a key part of our diversification strategy to increase our non‑aeronautical revenues.

The following table provides summary data for each of our 13 airports for the years ended December 31, ~~2016,~~ 2017, 2018 and ~~2018:~~2019:


	For the Year Ended December 31,																							For the Year Ended December 31,
	2016								2017								2018							2017								2018								2019
							Aeronautical								Aeronautical								Aeronautical							Aeronautical								Aeronautical								Aeronautical
				Sum of			and Non-					Sum of			and Non-					Sum of			and Non-				Sum of			and Non-					Sum of			and Non-					Sum of			and Non-
				Aeronautical			Aeronautical					Aeronautical			Aeronautical					Aeronautical			Aeronautical				Aeronautical			Aeronautical					Aeronautical			Aeronautical					Aeronautical			Aeronautical
				and			Revenues					and			Revenues per					and			Revenues				and			Revenues					and			Revenues per					and			Revenues
	Terminal			Non-Aeronautical			per Terminal		Terminal			Non-Aeronautical			Terminal		Terminal			Non-Aeronautical			per Terminal	Terminal			Non-Aeronautical			per Terminal		Terminal			Non-Aeronautical			Terminal		Terminal			Non-Aeronautical			per Terminal
	Passengers			Revenues (1)			Passenger(2)		Passengers			Revenues(1)			Passenger (2)		Passengers			Revenues(1)			Passenger (2)	Passengers			Revenues (1)			Passenger(2)		Passengers			Revenues(1)			Passenger (2)		Passengers			Revenues(1)			Passenger (2)
	(Number			(in millions					(Number			(in millions					(Number			(in millions			(in pesos)	(Number			(in millions					(Number			(in millions					(Number			(in millions			(in pesos)
Airport	in millions)	%		of pesos)	%		(pesos)		in millions)	%		of pesos)	%		(pesos)		in millions)	%		of pesos)	%			in millions)	%		of pesos)	%		(pesos)		in millions)	%		of pesos)	%		(pesos)		in millions)	%		of pesos)	%
Metropolitan destination:
Monterrey	9.2	48.9	%	2,359.8	49.3	%	257.1		9.8	49.7	%	2,593.7	49.1	%	265.4		10.7	49.8	%	3,097.4	50.1	%	288.6	9.8	49.7	%	2,593.7	49.1	%	265.4		10.7	49.8	%	3,097.4	50.1	%	288.6		11.2	48.2	%	3,367.7	48.5	%	301.3
Total metropolitan destination	9.2	48.9	%	2,359.8	49.3	%	257.1	(3)	9.8	49.7	%	2,593.7	49.1	%	265.4	(3)	10.7	49.8	%	3,097.4	50.1	%	288.6	9.8	49.7	%	2,593.7	49.1	%	265.4	(3)	10.7	49.8	%	3,097.4	50.1	%	288.6	(3)	11.2	48.2	%	3,367.7	48.54	%	301.3
Tourist destinations:
Acapulco	0.7	3.8	%	179.7	3.8	%	250.1		0.7	3.5	%	192.5	3.7	%	281.0		0.7	3.4	%	216.9	3.5	%	293.5	0.7	3.5	%	192.5	3.7	%	281.0		0.7	3.4	%	216.9	3.5	%	293.5		0.9	3.8	%	268.2	3.9	%	306.4
Mazatlán	1.0	5.2	%	268.4	5.6	%	275.7		1.0	5.1	%	297.3	5.6	%	299.0		1.0	4.9	%	322.9	5.2	%	310.9	1.0	5.1	%	297.3	5.6	%	299.0		1.0	4.9	%	322.9	5.2	%	310.9		1.2	5.0	%	374.2	5.4	%	322.2
Zihuatanejo	0.6	3.0	%	167.4	3.5	%	300.3		0.6	3.0	%	194.9	3.7	%	325.9		0.6	2.6	%	190.5	3.1	%	336.3	0.6	3.0	%	194.9	3.7	%	325.9		0.6	2.6	%	190.5	3.1	%	336.3		0.6	2.7	%	217.1	3.1	%	347.3
Total tourist destinations	2.3	12.0	%	615.5	12.9	%	273.6	(3)	2.3	11.6	%	684.7	13.0	%	300.7	(3)	2.3	10.9	%	730.3	11.8	%	311.6	2.3	11.6	%	684.7	13.0	%	300.7	(3)	2.3	10.9	%	730.3	11.8	%	311.6	(3)	2.7	11.5	%	859.5	12.39	%	322.9
Regional destinations:
Chihuahua	1.3	7.0	%	321.3	6.7	%	246.0		1.4	7.2	%	361.5	6.9	%	256.5		1.6	7.2	%	420.9	6.8	%	270.4	1.4	7.2	%	361.5	6.9	%	256.5		1.6	7.2	%	420.9	6.8	%	270.4		1.7	7.3	%	478.4	6.9	%	281.4
Culiacán	1.7	9.2	%	399.4	8.3	%	231.3		1.9	9.7	%	462.7	8.8	%	242.3		2.3	10.5	%	596.9	9.6	%	262.8	1.9	9.7	%	462.7	8.8	%	242.3		2.3	10.5	%	596.9	9.6	%	262.8		2.5	10.6	%	684.3	9.9	%	278.3
Durango	0.4	2.3	%	109.6	2.3	%	258.2		0.4	2.0	%	111.9	2.1	%	282.8		0.4	1.9	%	123.1	2.0	%	293.9	0.4	2.0	%	111.9	2.1	%	282.8		0.4	1.9	%	123.1	2.0	%	293.9		0.5	2.3	%	163.6	2.4	%	310.4
San Luis Potosí	0.5	2.7	%	154.0	3.2	%	305.4		0.6	2.8	%	174.4	3.3	%	315.2		0.6	2.9	%	197.3	3.2	%	314.9	0.6	2.8	%	174.4	3.3	%	315.2		0.6	2.9	%	197.3	3.2	%	314.9		0.6	2.8	%	210.0	3.0	%	326.4
Tampico	0.7	3.8	%	185.1	3.9	%	258.0		0.7	3.6	%	197.4	3.7	%	275.2		0.7	3.4	%	217.4	3.5	%	295.1	0.7	3.6	%	197.4	3.7	%	275.2		0.7	3.4	%	217.4	3.5	%	295.1		0.7	3.2	%	225.2	3.2	%	304.7
Torreón	0.7	3.4	%	171.3	3.6	%	264.9		0.6	3.1	%	178.6	3.4	%	288.6		0.7	3.2	%	207.1	3.3	%	303.8	0.6	3.1	%	178.6	3.4	%	288.6		0.7	3.2	%	207.1	3.3	%	303.8		0.7	3.1	%	225.1	3.2	%	317.7
Zacatecas	0.3	1.8	%	97.7	2.0	%	284.8		0.3	1.8	%	107.3	2.0	%	307.1		0.4	1.7	%	117.6	1.9	%	320.4	0.3	1.8	%	107.3	2.0	%	307.1		0.4	1.7	%	117.6	1.9	%	320.4		0.5	2.1	%	155.4	2.2	%	327.1
Total regional destinations	5.6	30.2	%	1,438.4	30.0	%	253.7	(3)	5.9	30.2	%	1,593.8	30.2	%	267.7	(3)	6.7	30.8	%	1,880.3	30.3	%	282.4	5.9	30.2	%	1,593.8	30.2	%	267.7	(3)	6.7	30.8	%	1,880.3	30.3	%	282.4	(3)	7.2	31.3	%	2,142.0	30.9	%	295.4
Border destinations:
Ciudad Juárez	1.1	5.9	%	242.4	5.1	%	219.8		1.2	6.0	%	285.6	5.4	%	243.4		1.4	6.3	%	356.2	5.8	%	261.1	1.2	6.0	%	285.6	5.4	%	243.4		1.4	6.3	%	356.2	5.8	%	261.1		1.6	6.9	%	436.3	6.3	%	273.1
Reynosa	0.6	3.0	%	127.7	2.7	%	226.4		0.5	2.5	%	119.4	2.3	%	245.8		0.5	2.2	%	121.7	2.0	%	260.6	0.5	2.5	%	119.4	2.3	%	245.8		0.5	2.2	%	121.7	2.0	%	260.6		0.5	2.1	%	131.8	1.9	%	274.2
Total border destinations	1.7	8.9	%	370.1	7.8	%	222.0	(3)	1.7	8.5	%	405.0	7.7	%	244.1	(3)	1.9	8.5	%	477.9	7.8	%	261.0	1.7	8.5	%	405.0	7.7	%	244.1	(3)	1.9	8.5	%	477.9	7.8	%	261.0	(3)	2.1	9.0	%	568.1	8.2	%	273.4
Sum of aeronautical and non-aeronautical revenues(1)	18.8	100	%	4,783.8	100.0	%	254.9	(3)	19.7	100.0	%	5,277.3	100.0	%	268.4	(3)	21.6	100.0	%	6,185.8	100.0	%	286.8	19.7	100	%	5,277.3	100	%	268.4	(3)	21.6	100.0	%	6,185.8	100.0	%	286.8	(3)	23.2	100	%	6,937.3	100	%	299.4

(1)

Defined as the sum of aeronautical and non-aeronautical revenues for each airport, which does not include eliminations among our subsidiaries and does not include revenues from construction services. Revenues in millions rounded to the decimal.

(2)

~~(3)~~

Revenues per terminal passenger are calculated by dividing ~~total~~the sum of aeronautical and non-aeronautical revenues for each airport by the number of terminal passengers for each airport. The result has been rounded to the decimal.

~~(4)~~(3)

Represents average total revenues per terminal passenger for the applicable airports.

See Note 26 to our consolidated financial statements for further information by segment. The Company’s reportable segments under IFRS include its airports, the Terminal 2 NH Collection Hotel, the Hilton Garden Inn Hotel and the OMA-VYNMSA Industrial Park, individually, and information about our holding company and service companies has been combined in the “other segments” line item, as they represent other business activities and are segments that are not required to be reported separately. For purposes of analysis, segments are comprised of our two hotels and thirteen individual airports, which have been grouped into four different regions according to their location: metropolitan, tourist, regional and border airports.

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Our Sources of Revenues

Aeronautical Services

Aeronautical services represent the most significant source of our revenues. All of our revenues from aeronautical services are regulated under the maximum‑rate price regulation system applicable to our airports. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, aeronautical services revenues represented approximately ~~69.8%~~61.0%, ~~61.0%~~65.0% and ~~65.0%~~67.5%, respectively, of our total revenues and ~~74.4%~~74.9%, ~~74.9%~~76.0% and 76.0%, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

Our revenues from aeronautical services are derived principally from: passenger charges, landing charges, aircraft parking charges, charges for the use of passenger walkways and charges for the provision of airport security services. Aeronautical services revenues are principally dependent on the following factors: passenger traffic volume, the number of air traffic movements, the weight of the aircraft, the duration of an aircraft’s stay at the airport, the time of day the aircraft operates at the airport and the specific prices charged for the service.

Passenger Charges

We collect a passenger charge for each departing passenger on an aircraft (other than diplomats, infants and transfer and transit passengers) called the Tarifa de Uso de Aeropuerto. We do not collect passenger charges from arriving passengers. Passenger charges are included in the cost of a passenger’s ticket and we issue invoices for those charges to each airline on a weekly basis and record an account receivable for the invoice corresponding to a flight during the actual month of the flight.

The current agreements between our airports and our principal airline customers provide that payments for passenger charges will be between 30 and 60 days after the invoice delivery date. In ~~2018,~~2019, the weighted average term of payment was 4243 days.

International passenger charges are currently U.S. dollar‑denominated but are collected in pesos based on the average exchange rate during the month prior to the flight, and the value of our revenues from those charges is therefore affected by fluctuations in the value of the U.S. dollar as compared to the peso. Domestic passenger charges are peso‑denominated. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, passenger charges represented approximately ~~84.9%~~85.7%, ~~85.7%~~86.5% and ~~86.5%~~86.6%, respectively, of our aeronautical services revenues, ~~59.4%~~52.2%, ~~52.2%~~56.2% and ~~56.2%~~58.5%, respectively, of our total revenues and ~~63.2%~~64.2%, ~~64.2%~~65.7% and ~~65.7%~~65.9%, respectively, of the sum of aeronautical and non‑aeronautical revenues. Passenger charges vary at each airport and based on the destination of each flight.

Aircraft Landing Charges

We collect landing charges from all carriers including cargo carriers for their use of our runways and taxiways, illumination systems on the runways and taxiways and other visual landing assistance services. Our landing charges are different for each of our airports and are based on each landing aircraft’s weight (determined as an average of the aircraft’s weight without fuel and maximum takeoff weight), the time of the landing, the origin of the flight and the nationality of the airline or client. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, these charges represented approximately ~~4.3%~~4.1%, ~~4.1%~~4.0% and 4.0%, respectively, of our aeronautical services revenues, ~~3.0%~~2.5%, ~~2.5%~~2.6% and ~~2.6%~~2.7%, respectively, of our total revenues and ~~3.2%~~3.1%, ~~3.1%~~3.0% and 3.0%, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

Aircraft Parking, Boarding and Unloading Charges and Aircraft Long-Term Parking Charges

We collect various charges from all carriers including cargo carriers for the use of our facilities by their aircraft and passengers after landing. We collect aircraft parking charges based on the time an aircraft is at an airport’s gate or parking position. Each of these charges varies based on the time of day or night that the relevant service is provided (with higher fees generally charged during peak usage periods and at night), the aircraft’s maximum takeoff weight, the origin and destination of the flight and whether the service is domestic or international. We collect aircraft parking charges the entire time an aircraft is on our aprons.

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We collect charges from carriers for the long‑term use of facilities at our airports for aircraft long‑term parking that does not involve the loading or unloading of passengers or cargo. These charges are based on the time of day or night the aircraft is parked at our facilities, the length of time the aircraft is parked at our facilities and whether the service is domestic or international. Together with our aircraft parking, boarding and unloading charges described above, in ~~2016,~~ 2017, 2018 and ~~2018,~~2019, these charges represented approximately ~~3.9%~~3.5%, ~~3.5%~~3.4% and ~~3.4%~~3.2%, respectively, of our aeronautical services revenues, ~~2.7%~~2.1%, ~~2.1%~~2.2% and 2.2%, respectively, of our total revenues and ~~2.9%~~2.6%, ~~2.6%~~2.5%, and 2.5%, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

Passenger Walkway Charges

Airlines are also assessed charges for the connection of their aircraft to our terminals through a passenger walkway and for the transportation of passengers between terminals and aircraft via buses and other vehicles. These charges are generally based on the amount of time each service is used, the number of these services used, the time of day the services are used, the origin and destination of the flight and the nationality of the airline or client. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, these charges represented approximately ~~1.1%~~1.0%, ~~1.0%~~0.9% and ~~0.9%~~0.8%, respectively, of our aeronautical services revenues, ~~0.7%~~0.6%, 0.6% and 0.6%, respectively, of our total revenues and 0.8%, ~~0.8%~~0.7% and ~~0.7%~~0.6%, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

Airport Security Charges

We also assess an airport security charge, which is collected from each airline, based on the number of its departing terminal passengers (excluding infants, diplomats and transit passengers), for use of our x‑ray equipment, metal detectors and other security equipment and personnel. These charges are based on the time of day the services are used, the number of departing passengers and the destination of the flight. Independent subcontractors provide airport security services at our airports. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, these charges represented approximately ~~1.0%~~1.1%, 1.1% and 1.1%, respectively, of our aeronautical services revenues, 0.7%, 0.7% and 0.7%, respectively, of our total revenues and ~~0.7%~~0.8%, 0.8% and 0.8%, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

The ICAO, the ~~Mexican Bureau of Civil Aviation~~AFAC and the Office of Public Security issue guidelines for airport security in Mexico. In response to the September 11, 2001 terrorist attacks in the United States, we have taken additional steps to increase security at our airports. The ICAO issued directives in October 2001 establishing new rules and procedures to be adopted at our airports. Under these directives, these rules and procedures were to be implemented immediately and for an indefinite period of time.

Several of our airline customers have also contributed to the enhanced security at our airports as they have adopted new procedures and guidelines established by the ICAO applicable to airlines. Some measures adopted by the airlines included adding more points for verification of passenger identification, inspecting luggage prior to check‑in and reinforcing controls over access to airplanes by various service providers (such as baggage handlers and food service providers).

The ICAO established security guidelines requiring checked baggage on all international commercial flights as of January 2006, and all domestic commercial flights as of July 2006, to undergo a comprehensive screening process for the detection of explosives. Our subsidiary, Servicios Complementarios del Centro Norte, S.A. de C.V., has operated the checked‑baggage screening system since March 1, 2012. In some countries, such as the United States, the federal government (in the case of the United States, through ~~the Transportation Security Administration)~~TSA) is responsible for screening checked baggage. Under Mexican law, however, airlines are responsible for screening checked baggage. On May 1, 2014 and July 1, 2016, the ~~Mexican Bureau of Civil Aviation~~AFAC published mandatory circulars CO SA‑17.2/10 R3 and CO SA-17.9/16, respectively, which require that all airlines screen checked baggage and that all airports have screening equipment that complies with specified guidelines. Although Mexican law holds airlines liable for screening checked baggage, the purchase, installation and operation of equipment could increase our exposure to liability as a result of our involvement in the screening process. In addition, although we are not currently obligated to screen checked baggage, we could become obligated to do so, and thus become subject to potential liability, if Mexican law changes in the future. Revenues derived from checked baggage screening are classified as non-aeronautical revenues see “Item 4. Information on the Company—Our Sources of Revenue.”

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Complementary Service Providers

At each of our airports, we earn revenues from charging access and other fees from third‑party providers, ramp‑handling and baggage‑handling services, catering services, aircraft security, providers of aircraft maintenance and repair and fuel. These access fees are included in the revenues that are regulated under our maximum‑rate price regulation system and are determined for each third‑party service provider based on a percentage of their total revenues. We currently maintain contracts with 5653 companies that provide the majority of these complementary services at our 13 airports.

Under the Mexican Airport Law, we are required to provide complementary services at each of our airports if there is no third party providing such services. If any service providers were to halt operations at any of our airports, we could be required to seek a new provider of these services or to provide these services ourselves.

On November 1, 1998, the Company entered into an agreement with the Mexican Airport and Auxiliary Services Agency (Aeropuertos y Servicios Auxiliares or "ASA"), pursuant to which the Company granted the agency access to the facilities at the Company’s airports for a nominal fee in order for ~~the Mexican Airport and Auxiliary Services Agency~~ASA to buy, sell and supply fuel in such facilities. On July 21, 2018, the Mexican Bureau of Civil Aviation (currently AFAC) published a notice in the Federal Official Gazette clarifying the scope of Transitory Article Nine of the Regulations of the Mexican Airport Law, stating that as of the publication of the Hydrocarbons Law on August 11, 2014, the fuel market was to be considered open so that any interested party can distribute and sell Jet-A fuel. This clarification opens the possibility for third parties complying with the applicable legal requirements to provide fuel distribution and supply services within the airports operated by the Company. ~~The Company is currently analyzing~~As of the ~~current scope~~date of ~~these rules.~~this report, there are no third parties, other than ASA, providing fuel distribution and supply services within such airports.

Leasing of Space to Airlines

We derive aeronautical revenues from leasing space in our airports to airlines that is necessary for their operations, such as ticket counters and offices. Our lease agreements with airline customers for the use of space in our airports are typically for terms of three years with provisions for periodic inflation adjustments to our rental fees.

Cargo Handling

Cargo‑related revenues include revenues from the leasing of space in the airside of our airports to cargo handling agents and shippers, landing fees for each arriving aircraft carrying cargo and a portion of the revenues derived from other complementary services provided in connection with cargo services. Cargo‑related revenues are largely aeronautical and therefore subject to maximum rates applicable to aeronautical revenue sources.

Revenues from cargo handling in our airports historically have represented a negligible portion of our total revenues.

Permanent Ground Transportation

We receive revenues from ground transportation vehicles and taxi companies who pay an access fee to operate on our airport premises. Our revenues from providers of ground transport services deemed “permanent” under applicable Mexican law, such as access fees charged to taxis, are subject to price regulation.

Non-Aeronautical Services

General

Non‑aeronautical services historically have generated a significantly smaller portion of our revenues as compared to aeronautical services. Our revenues from non‑aeronautical services are principally derived from (i) commercial activities, such as the leasing of space in our airports to retailers, restaurants and other commercial tenants, maintaining and operating parking facilities and advertising; (ii) diversification activities, such as hotel services, air

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cargo logistics services, operation and lease of the industrial park and real estate ~~services;~~services and (iii) complementary activities, which principally include the leasing of space to airlines and the baggage‑screening system.

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None of our revenues from non‑aeronautical services are regulated under our maximum‑rate price regulation system, though other authorities may regulate them. For example, our parking facilities may be subject to certain municipal regulations.

As one of the main parts of our business strategy, we have prioritized increasing our non‑aeronautical revenues, seeking new and improved commercial prices at our airports, as well as the development of the diversification and complementary activities. As a result of our efforts during the last ten years, our non‑aeronautical revenues have increased as a percentage of our revenues. In ~~2008,~~2009, non‑aeronautical revenues represented ~~15.0%~~14% of our total revenues, while in ~~2016,~~ 2017, 2018, and ~~2018,~~2019 non‑aeronautical revenues accounted for approximately ~~24.0%~~20.4%, ~~20.4%~~20.6% and ~~20.6%~~21.3% of our total revenues, respectively. Non‑aeronautical revenues represented ~~25.6%~~25.1%, ~~25.1% and~~24.0%, 24.0% in ~~2016,~~ 2017, 2018 and ~~2018,~~2019, respectively, of the sum of our aeronautical and non‑aeronautical revenues.

Revenues from Commercial Activities

As another main part of our business strategy to enhance our non‑aeronautical revenues, we have prioritized increasing our revenues from commercial activities in our airports through the development of new areas and promotion of the commercial services described below. As a result of our efforts, our revenues from commercial activities increased by ~~14.0%~~15.3% in ~~2018~~2019 as compared to ~~2017,~~2018, primarily as a result of the following initiatives:

Expanding and reconfiguring the commercial space available in our airport terminals. In order to increase our revenues from commercial activities, we have expanded and redesigned the layout of certain terminals in our airports to allow for the inclusion of more commercial businesses and larger individual commercial spaces, as well as to redirect the flow of passengers through our airports so as to increase passengers’ exposure to the commercial businesses operating in our airports. As a result, during the last ten years, we increased the total area available for commercial activity in our 13 airports by approximately ~~72.3%~~63.2%, and have more than doubled the commercial area in the Monterrey airport. As of December 31, ~~2018,~~2019, the total area available for commercial activity at our 13 airports was ~~20,084~~20,815 square meters ~~(216,184~~(224,053 square feet), with an occupancy rate of ~~99.2%~~97.2%.

Renegotiating agreements with terminal tenants to be more consistent with market practice. We ~~have also~~ improved our lease arrangements with existing tenants by adopting a new type of contract that provides for royalty payments based on a percentage of revenues, subject to a minimum fixed amount based partly on square footage, as opposed to the leases based solely on square footage that were used historically in Mexican airports. We estimate, based on the nature of our tenant operations, that approximately ~~56.0%~~57.0% of our commercial space ~~is suitable for~~are subject to royalty‑based leasing arrangements. As of December 31, ~~2018,~~2019, substantially all of the eligible contracts were represented by royalty‑based leasing arrangements.

Improving the quality of retail offerings in our airports. Historically, commercial tenants in our terminals consisted of small, often similar, local businesses offering goods and services of limited variety. We have leased redesigned space formerly occupied by such tenants, as well as newly available space, to more established, internationally recognized businesses in order to improve the quality, diversity and brand recognition of commercial goods and services available to our passengers, which we believe, based in part on market surveys conducted at several of our airports, will increase the sales revenues of our commercial tenants, thereby increasing our revenues from commercial activities. As a result, our food and beverage service tenants currently offer internationally recognized brands such as Starbucks, Chili’s, Carl’s Jr, Johnny Rockets, Cinnabon, Denny’s, Krispy Kreme, Urban Corner, Gastro Hub and Maison Kayser. In order to promote commercial development at all of our airports, we encourage commercial tenants to lease bundles of commercial spaces among multiple airports that we operate.

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Providing timely commercial information. We ~~work~~use social media to communicate the commercial opportunities and activities at our airports on a daily ~~basis to improve our commercial communication, mostly via our web site.~~basis. We believe that good communication is the best method to promote our commercial services. We advertise current deals and new commercial services and, in some cases, we offer seasonal deals in coordination with our tenants.

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Improving travel experience. Our commercial team works together with our operational team, airline clients and commercial tenants to devise customer‑oriented solutions to deliver a better experience for all our passengers.

Commercial activities in each of our airports currently consist of the following:

Parking facilities. Our concessions provide us the right to operate the car parking facilities at all of our airports. Revenues from parking facilities at our airports currently are not regulated under our maximum rates, although they are subject to the regulatory oversight of the Ministry of Communications and Transportation. In 2018, we opened new passenger parking facilities at the Reynosa airport, with 97105 spaces for long-term stays. In 2019, we opened a new parking lot at the Chihuahua airport, adding 366 spaces for long term stays, which increased existing spaces from 274 to 640.~~This additional capacity benefits our customers by offering more comfortable facilities.~~

Advertising. On October 4, 2018, , we signed a new lease and advertising services agreement with ISA Corporativo, SA de CV (“ISA”), effective as of October 4, 2018 through December 31, ~~2025, as part of our initiative to modernize advertising services and increase revenues from this line of business.~~2025. This contract replaced the contract that we had with SSL Digital, SAS.A. de ~~CV (“SSL”)~~C.V., , which was rescinded on December 3, 2017.

Retail and duty free. We have completed several renovation projects as part of our overall effort (described above) to improve the product mix and brand recognition of retail stores in the commercial areas at our airports. Our retailer tenants currently offer such internationally recognized product brands as Hermès, Tous, Mont Blanc, Swatch, Christian Dior, Lancôme, L’Oréal, Swarovski, Lacoste, Cartier, Bulgari, Hugo Boss and TUMI. We also have several duty‑free retailers that cater to international passengers.

Food and beverage services. ~~Through the years,~~During 2019, we ~~have upgraded our~~conducted a bid to modernize twenty restaurant and bar ~~offerings, which has allowed us~~units in several of our airports. A new contract was awarded to ~~attract world‑class operators of~~airport food and beverage ~~outlets~~operator Grupo Areas to develop and commercialize those food and beverage units, offering a wide variety of cuisine options and service concepts. We also extended an agreement with Alsea, S.A. de C.V. which holds the rights to develop Starbucks units, to operate a new coffee shop in each of the Monterrey, San Luis Potosí and Torreón airports, in addition to the ongoing operation of other coffee shops in the Monterrey, Acapulco, Ciudad Juárez, Culiacán and Chihuahua airports, for a total of 12 units across our airports.

Car rentals. We have increased the presence of internationally known name‑brand car rental providers at our airports and have encouraged car rental companies to establish on‑site automobile pick‑up and drop‑off facilities at our airports. We have also encouraged our car rental providers to differentiate their VIP services and modernize their facilities.

Time‑share marketing and hotel promotion. We receive revenues from time‑share developers and hotels to whom we rent space in our airports for the purpose of marketing and sales of time‑share units.

Financial services. We lease space to financial services providers (such as currency exchange bureaus, banks and ATMs) at our airports, and we charge providers of these financial services fees based partly on a percentage of the revenues recorded by their operations. ATM service is currently available at all of our airports.

Communications. We ~~have consolidated most of the~~offer telephone, mobile phone and internet services at our airports through contractual agreements with ~~one provider~~service providers and offer ~~internet access (either~~ wireless internet access ~~or internet service kiosks)~~ at all of our airports.

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VIP Lounges. We lease space for the OMA Premium Lounge in the Monterrey, Mazatlán, Culiacán,Chihuahua, Acapulco and San Luis Potosí airports and for the American Express‑Centurion VIP Lounge and CitiBanamex Beyond Lounge in the Monterrey airport, which provide their frequent flyers a luxury waiting lounge with comfortable seating, internet service, television and free newspapers, among other amenities.

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Revenues from Diversification Activities

To enhance our non‑aeronautical revenues, we also focus our business strategy on generating new services and products to diversify our revenue sources, such as hotel services, air cargo logistics services and real estate services. We develop land not intended for aeronautical purposes at our airports for industrial, logistical or commercial uses that are directly or indirectly related to airport activities in order to strengthen the airports’ role as focal points of economic development in the cities where they are located. As a result of our efforts, our revenues from diversification activities increased by ~~8.4%~~8.1% in ~~2018~~2019 as compared to ~~2017,~~2018, primarily as a result of the following initiatives:

Developments at Mexico City International Airport. In October 2008, we acquired 90% of the shares of Consorcio Grupo Hotelero Terminal 2, S.A. de C.V., which has the rights to develop and operate a 287‑room hotel and approximately 5,000 square meters (53,820 square feet) of commercial space inside the new Terminal 2 of Mexico City International Airport, under a lease agreement with Mexico City International Airport that expires in 2029. A Mexican subsidiary of NH Hoteles SA, a Spanish company, owns the other 10%. The Terminal 2 NH Collection Hotel opened in August 2009. For the year ended December 31, ~~2018,~~2019, total revenues amounted to ~~Ps.246,065~~Ps.255,393 thousand and annual average occupancy during such period was ~~83.5%~~84.1%. In ~~2018,~~2019, the annual average rate per room was ~~Ps.2,293 thousand~~. Ps.2,297.

Hotel at Monterrey Airport. In July 2013, we partnered with Grupo Hotelero Santa Fe, a Mexican hospitality investment and operating company, to develop and operate a 134‑room hotel at the Monterrey airport under the Hilton Garden Inn brand. We own 85% of Consorcio Grupo Hotelero de Monterrey, S.A.P.I. de C.V. and Grupo Hotelero Santa Fe holds the remaining 15%. The Hilton Garden Inn at the Monterrey airport includes a restaurant and bar, business centers and a fitness center and is easily accessible from Terminals A and B of the airport. ~~As of December 31, 2018, the net investment in the construction of the hotel was Ps.254,551 thousand.~~ For the year ended December 31, ~~2018,~~2019, total revenues amounted to ~~Ps.100,051~~Ps.103,474 thousand, and annual average occupancy during such period was ~~77.6%~~77.7%. In ~~2018,~~2019, the annual average rate per room was ~~Ps.2,175 thousand~~.Ps.2,245.

OMA Carga Operations. We operate four bonded warehouses that provide cargo logistics services, which include storage, handling, custody maneuvers, loading and unloading, and x‑ray screening of exports, among other services. Two bonded warehouses operate at the Monterrey airport, one operates at the Ciudad Juárez airport and the other at the Chihuahua airport. Total revenues from OMA Carga Operations increased by ~~16.0~~9.9% to ~~Ps.177,396~~Ps.194,936 thousand, in comparison to revenues from ~~2017.~~2018. This increase resulted froma greater volume of imports and exports through our ~~bonded warehouses.~~ground cargo warehouse at our Monterrey airport.

Shopping Center and Office Plaza. Located in the outside areas of Terminal A of the Monterrey airport, the shopping center and office plaza consists of a two‑story building with commercial space on the lower level and office space for rent on the upper level.

Office Center for Cargo Logistics Agents. Leasing of 1,045 square meters (11,248 square feet) of space at the Monterrey airport with an occupancy rate of ~~97.3%~~100% as of December 31, ~~2018.~~2019.

Gasoline Service Station at Monterrey Airport. In December 2012, a gasoline service station within the Monterrey airport began operations. The 2,500 square meters (26,910 square feet) of land on which the service station is located is identified for diversification activities and was leased to Grupo ORSAN, an authorized distributor of ~~Pemex Refining,~~Mobil, for a renewable term of 15 years. Grupo ORSAN is responsible for the operation of and all investments in the service station. In ~~2018,~~2019, the leasing of this land to Grupo ORSAN generated revenues of ~~Ps.2,827~~Ps.3,279 thousand.

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Strategic Alliance with VYNMSA. In November 2012, we, through our subsidiary OMA Logística, signed a strategic alliance agreement with VYNMSA, to build and operate an industrial park at the Monterrey airport, through the company OMA-VYNMSA Aero Industrial Park, S.A. de C.V. (in which OMA Logística has a 51% ownership interest and VYNMSA has a 49% ownership interest). As part of this strategic alliance, 32.4 hectares ~~(0.13 square miles)~~(80.06 acres) within the Monterrey airport’s perimeter are being developed in phases for use as an industrial park. The industrial park was inaugurated on March 20, 2015, and as of December ~~2018~~2019 had a total construction of 78 warehouses with a total leasable area of ~~45,254~~54,107 square meters ~~(487,110-square-feet)~~(582,209-square-feet), of which 67 warehouses have already been leased and are currently in operation. The ~~current total~~ leased area of the industrial park ~~is 40,254~~as of December 31, 2019 was of 53,442 square meters ~~(433,290-square-feet)~~(575,244-square-feet) with lease terms ranging from 40 to ~~84 months.~~144 months, Two new lease contracts were signed in December 2019. One contract is related to a 4,945 square-meter (53,228 square-foot) warehouse and will start revenue generation in 2020. The second contract relates to a new 4,945 square-meter (53,228 square-foot) facility, which is currently under construction, and will also start generating revenues in 2020.

Revenues from Complementary Activities

Our complementary activities generated ~~16.1%~~15.9% of our non‑aeronautical revenues in ~~2018.~~2019. These include:

Leasing of space. Revenues that we derive from the leasing of space in our terminals to airlines and complementary service providers for certain activities that are not essential to airport operations, such as first class/VIP lounges, are not subject to price regulation under our maximum rates and are classified as non‑regulated commercial activities.

Baggage‑Screening Services. The ICAO established security guidelines requiring checked baggage on all international commercial flights as of January 2006 and all domestic commercial flights as of July 2006 to undergo a comprehensive screening process for the detection of explosives. We completed the purchase and installation of screening equipment in all of our airports in 2015 to facilitate our airline customers’ compliance with the baggage‑screening guidelines. We negotiated an increase to maximum rates as of 2013 with the ~~Mexican Bureau of~~Federal Civil Aviation Agency to take into account the maintenance costs of baggage‑screening systems in all of our airports required by mandatory circulars CO SA‑17.2/10 R3 and CO SA-17.9/16. Our subsidiary Servicios Complementarios del Centro Norte, S.A. de C.V., has operated the checked‑baggage screening systems at our airports since March 1, 2012. In ~~2018,~~2019, our revenues from the operation of checked‑baggage screening system service, which are not subject to maximum rates, amounted to ~~Ps.153,192~~Ps.175,006 thousand.

Non‑Permanent Ground Transportation. Our revenues from providers of ground transportation services deemed “nonpermanent” under applicable Mexican law, such as access fees charged to charter buses, are not subject to price regulation under our maximum rates and are classified as non‑regulated commercial activities.

Access Rights. Revenues that we derive from granting access rights to ~~taxi drivers and other~~ transportation providers to ~~pick up passengers at the~~ terminal buildings inat our airports are not subject to price regulation under our maximum rates and are classified as non‑regulated commercial activities.

Our Airports

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, our airports served a total of approximately ~~18.8 million,~~ 19.7 million, 21.6 million and ~~21.6~~23.2 million terminal passengers, respectively. All of our airports are designated as international airports under applicable Mexican law, meaning that they are equipped to receive international flights and maintain customs and immigration facilities operated by the Mexican government.

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The following table sets forth the percentage of terminal passenger traffic generated at our airports per type of destination during ~~2016,~~ 2017, 2018 and ~~2018:~~2019:


	Percentage of Total Passenger Traffic						Percentage of Total Passenger Traffic
Type of Destination	2016		2017		2018		2017		2018		2019
Metropolitan (Monterrey)	48.9	%	49.7	%	49.8	%	49.7	%	49.8	%	48.2	%
Tourist (Acapulco, Mazatlán and Zihuatanejo)	12.0	%	11.6	%	10.9	%	11.6	%	10.9	%	11.5	%
Border (Ciudad Juárez and Reynosa)	8.9	%	8.5	%	8.5	%	8.5	%	8.5	%	9.0	%
Regional (Culiacán, Chihuahua, Durango, San Luis Potosí, Tampico, Torreón and Zacatecas)	30.2	%	30.2	%	30.8	%	30.2	%	30.8	%	31.3	%

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The following tables set forth the passenger traffic volume presented in amounts of (i) total passengers, (ii) terminal departing and arriving passengers and (iii) transit passengers, for each of our airports for the periods indicated:

Passenger Traffic


	For the Year Ended December 31,															For the Year Ended December 31,
	2014			2015			2016			2017			2018			2015			2016			2017			2018			2019
	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total	Terminal(1)	Transit(2)	Total
Total passengers:
Acapulco	631,570	14,319	645,889	730,382	5,420	735,802	718,493	5,478	723,971	685,124	5,198	690,322	739,120	15,340	754,460	730,382	5,420	735,802	718,493	5,478	723,971	685,124	5,198	690,322	739,120	15,340	754,460	875,315	14,298	889,613
Ciudad Juárez	769,029	12,769	781,798	863,760	13,153	876,913	1,102,855	19,262	1,122,117	1,173,135	7,846	1,180,981	1,364,028	9,725	1,373,753	863,760	13,153	876,913	1,102,855	19,262	1,122,117	1,173,135	7,846	1,180,981	1,364,028	9,725	1,373,753	1,597,471	8,168	1,605,639
Culiacán	1,307,717	24,045	1,331,762	1,432,315	4,930	1,437,245	1,726,654	12,227	1,738,881	1,909,651	14,480	1,924,131	2,270,834	10,477	2,281,311	1,432,315	4,930	1,437,245	1,726,654	12,227	1,738,881	1,909,651	14,480	1,924,131	2,270,834	10,477	2,281,311	2,458,863	8,915	2,467,778
Chihuahua	961,538	22,128	983,666	1,110,513	23,631	1,134,144	1,305,961	31,791	1,337,752	1,409,579	16,762	1,426,341	1,556,770	11,788	1,568,558	1,110,513	23,631	1,134,144	1,305,961	31,791	1,337,752	1,409,579	16,762	1,426,341	1,556,770	11,788	1,568,558	1,699,816	5,004	1,704,820
Durango	255,937	2,957	258,894	315,835	5,174	321,009	424,415	7,817	432,232	395,905	3,442	399,347	418,914	2,711	421,625	315,835	5,174	321,009	424,415	7,817	432,232	395,905	3,442	399,347	418,914	2,711	421,625	527,004	5,521	532,525
Mazatlán	789,234	19,100	808,334	853,409	17,176	870,585	973,440	35,656	1,009,096	994,283	22,085	1,016,368	1,038,555	14,220	1,052,775	853,409	17,176	870,585	973,440	35,656	1,009,096	994,283	22,085	1,016,368	1,038,555	14,220	1,052,775	1,161,155	21,573	1,182,728
Monterrey	7,128,531	28,686	7,157,217	8,461,917	60,260	8,522,177	9,178,533	18,608	9,197,141	9,771,630	28,232	9,799,862	10,733,186	36,620	10,769,806	8,461,917	60,260	8,522,177	9,178,533	18,608	9,197,141	9,771,630	28,232	9,799,862	10,733,186	36,620	10,769,806	11,176,555	24,797	11,201,352
Reynosa	472,027	957	472,984	507,186	838	508,024	563,952	545	564,497	485,727	288	486,015	466,934	158	467,092	507,186	838	508,024	563,952	545	564,497	485,727	288	486,015	466,934	158	467,092	480,524	169	480,693
San Luis Potosí	373,986	4,265	378,251	444,469	1,596	446,065	504,313	1,467	505,780	553,353	1,639	554,992	626,512	2,282	628,794	444,469	1,596	446,065	504,313	1,467	505,780	553,353	1,639	554,992	626,512	2,282	628,794	643,224	2,509	645,733
Tampico	688,893	15,979	704,872	763,744	9,747	773,491	717,599	8,685	726,284	717,342	4,199	721,541	736,627	2,638	739,265	763,744	9,747	773,491	717,599	8,685	726,284	717,342	4,199	721,541	736,627	2,638	739,265	739,143	2,750	741,893
Torreón	523,783	6,629	530,412	556,449	7,168	563,617	646,898	9,123	656,021	618,930	4,191	623,121	681,551	5,164	686,715	556,449	7,168	563,617	646,898	9,123	656,021	618,930	4,191	623,121	681,551	5,164	686,715	708,563	6,153	714,716
Zacatecas	284,625	1,656	286,281	320,065	2,817	322,882	343,136	2,802	345,938	349,453	1,470	350,923	366,871	2,639	369,510	320,065	2,817	322,882	343,136	2,802	345,938	349,453	1,470	350,923	366,871	2,639	369,510	475,241	3,849	479,090
Zihuatanejo	508,065	6,727	514,792	562,099	6,156	568,255	557,389	5,835	563,224	597,902	2,068	599,970	566,497	1,331	567,828	562,099	6,156	568,255	557,389	5,835	563,224	597,902	2,068	599,970	566,497	1,331	567,828	625,186	501	625,687
Total	14,694,935	160,217	14,855,152	16,922,143	158,066	17,080,209	18,763,638	159,296	18,922,934	19,662,014	111,900	19,773,914	21,566,399	115,093	21,681,492	16,922,143	158,066	17,080,209	18,763,638	159,296	18,922,934	19,662,014	111,900	19,773,914	21,566,399	115,093	21,681,492	23,168,060	104,207	23,272,267

(1)

Includes arriving and departing passengers as well as transfer passengers (passengers who arrive at our airports on one aircraft and depart on a different aircraft).

(2)

Terminal passengers who arrive at our airports but generally depart without changing aircraft.

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	For the Year Ended December 31,																For the Year Ended December 31,
	2014			2015			2016			2017			2018				2015				2016				2017				2018				2019
	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic		International	Total	Domestic		International	Total	Domestic		International	Total	Domestic		International	Total	Domestic		International	Total
Terminal departing passengers:
Acapulco	274,886	40,702	315,588	329,383	39,643	369,026	323,773	40,745	364,518	305,337	41,326	346,663	327,220	43,948	371,168	329,383		39,643	369,026	323,773		40,745	364,518	305,337		41,326	346,663	327,220		43,948	371,168	392,382		46,383	438,765
Ciudad Juárez	373,338	469	373,807	422,071	439	422,510	533,229	4,233	537,462	573,739	2,244	575,983	668,369	3,927	672,296	422,071		439	422,510	533,229		4,233	537,462	573,739		2,244	575,983	668,369		3,927	672,296	772,724		5,856	778,580
Culiacán	649,647	16,963	666,610	705,913	15,757	721,670	850,046	20,723	870,769	940,889	22,723	963,612	1,118,311	25,413	1,143,724	705,913		15,757	721,670	850,046		20,723	870,769	940,889		22,723	963,612	1,118,311		25,413	1,143,724	1,210,867		30,656	1,241,523
Chihuahua	424,021	55,237	479,258	488,509	66,048	554,557	587,020	64,486	651,506	638,836	65,574	704,410	701,064	72,745	773,809	488,509		66,048	554,557	587,020		64,486	651,506	638,836		65,574	704,410	701,064		72,745	773,809	762,680		80,957	843,637
Durango	110,107	16,470	126,577	139,890	16,113	156,003	181,066	30,084	211,150	161,252	36,228	197,480	171,650	37,542	209,192	139,890		16,113	156,003	181,066		30,084	211,150	161,252		36,228	197,480	171,650		37,542	209,192	208,049		56,567	264,616
Mazatlán	259,659	137,412	397,071	282,542	145,994	428,536	341,246	145,987	487,233	341,616	157,267	498,883	363,086	157,710	520,796	282,542		145,994	428,536	341,246		145,987	487,233	341,616		157,267	498,883	363,086		157,710	520,796	413,165		166,222	579,387
Monterrey	2,999,728	556,128	3,555,856	3,518,133	691,649	4,209,782	3,908,835	661,811	4,570,646	4,193,276	674,556	4,867,832	4,612,687	728,440	5,341,127	3,518,133		691,649	4,209,782	3,908,835		661,811	4,570,646	4,193,276		674,556	4,867,832	4,612,687		728,440	5,341,127	4,777,176		774,363	5,551,539
Reynosa	229,420	265	229,685	245,030	189	245,219	270,902	244	271,146	234,880	3,210	238,090	225,614	3,354	228,968	245,030		189	245,219	270,902		244	271,146	234,880		3,210	238,090	225,614		3,354	228,968	230,461		3,392	233,853
San Luis Potosí	121,913	63,540	185,453	144,976	75,117	220,093	167,369	83,748	251,117	185,349	91,558	276,907	207,879	104,717	312,596	144,976		75,117	220,093	167,369		83,748	251,117	185,349		91,558	276,907	207,879		104,717	312,596	211,770		108,127	319,897
Tampico	314,875	31,015	345,890	345,185	30,284	375,469	333,111	27,728	360,839	332,405	28,354	360,759	333,706	37,904	371,610	345,185		30,284	375,469	333,111		27,728	360,839	332,405		28,354	360,759	333,706		37,904	371,610	331,815		38,671	370,486
Torreón	235,919	27,218	263,137	253,366	27,594	280,960	291,377	35,472	326,849	277,275	37,673	314,948	299,449	43,274	342,723	253,366		27,594	280,960	291,377		35,472	326,849	277,275		37,673	314,948	299,449		43,274	342,723	306,625		47,316	353,941
Zacatecas	91,071	52,829	143,900	100,021	61,219	161,240	106,950	65,909	172,859	104,028	71,578	175,606	107,399	76,809	184,208	100,021		61,219	161,240	106,950		65,909	172,859	104,028		71,578	175,606	107,399		76,809	184,208	158,191		81,492	239,683
Zihuatanejo	142,767	108,393	251,160	159,121	119,679	278,800	159,999	116,872	276,871	177,623	121,440	299,063	167,886	116,800	284,686	159,121		119,679	278,800	159,999		116,872	276,871	177,623		121,440	299,063	167,886		116,800	284,686	197,126		116,593	313,719
Total	6,227,351	1,106,641	7,333,992	7,134,140	1,289,725	8,423,865	8,054,923	1,298,042	9,352,965	8,466,505	1,353,731	9,820,236	9,304,320	1,452,583	10,756,903	7,134,140		1,289,725	8,423,865	8,054,923		1,298,042	9,352,965	8,466,505		1,353,731	9,820,236	9,304,320		1,452,583	10,756,903	9,973,031		1,556,595	11,529,626

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	For the Year Ended December 31,															For the Year Ended December 31,
	2014			2015			2016			2017			2018			2015			2016			2017			2018			2019
	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total	Domestic	International	Total
Terminal arriving passengers:
Acapulco	301,156	14,826	315,982	348,315	13,041	361,356	340,645	13,330	353,975	326,492	11,969	338,461	354,367	13,585	367,952	348,315	13,041	361,356	340,645	13,330	353,975	326,492	11,969	338,461	354,367	13,585	367,952	422,254	14,296	436,550
Ciudad Juárez	394,633	589	395,222	440,887	363	441,250	561,086	4,307	565,393	596,586	566	597,152	691,262	470	691,732	440,887	363	441,250	561,086	4,307	565,393	596,586	566	597,152	691,262	470	691,732	818,244	647	818,891
Culiacán	640,686	421	641,107	710,359	286	710,645	849,603	6,282	855,885	939,409	6,630	946,039	1,123,022	4,088	1,127,110	710,359	286	710,645	849,603	6,282	855,885	939,409	6,630	946,039	1,123,022	4,088	1,127,110	1,211,407	5,933	1,217,340
Chihuahua	443,627	38,653	482,280	509,752	46,204	555,956	610,388	44,067	654,455	659,426	45,743	705,169	734,964	47,997	782,961	509,752	46,204	555,956	610,388	44,067	654,455	659,426	45,743	705,169	734,964	47,997	782,961	802,503	53,676	856,179
Durango	120,603	8,757	129,360	153,140	6,692	159,832	194,669	18,596	213,265	177,219	21,206	198,425	191,524	18,198	209,722	153,140	6,692	159,832	194,669	18,596	213,265	177,219	21,206	198,425	191,524	18,198	209,722	224,717	37,671	262,388
Mazatlán	271,600	120,563	392,163	291,938	132,935	424,873	353,629	132,578	486,207	353,920	141,480	495,400	375,957	141,802	517,759	291,938	132,935	424,873	353,629	132,578	486,207	353,920	141,480	495,400	375,957	141,802	517,759	434,104	147,664	581,768
Monterrey	3,093,287	479,388	3,572,675	3,626,723	625,412	4,252,135	4,008,793	599,094	4,607,887	4,308,480	595,318	4,903,798	4,788,705	603,354	5,392,059	3,626,723	625,412	4,252,135	4,008,793	599,094	4,607,887	4,308,480	595,318	4,903,798	4,788,705	603,354	5,392,059	4,979,390	645,626	5,625,016
Reynosa	241,890	452	242,342	261,644	323	261,967	292,452	354	292,806	247,231	406	247,637	237,689	277	237,966	261,644	323	261,967	292,452	354	292,806	247,231	406	247,637	237,689	277	237,966	246,429	242	246,671
San Luis Potosí	140,521	48,012	188,533	169,231	55,145	224,376	190,596	62,600	253,196	210,794	65,652	276,446	243,290	70,626	313,916	169,231	55,145	224,376	190,596	62,600	253,196	210,794	65,652	276,446	243,290	70,626	313,916	242,306	81,021	323,327
Tampico	326,042	16,961	343,003	372,402	15,873	388,275	341,655	15,105	356,760	341,321	15,262	356,583	349,805	15,212	365,017	372,402	15,873	388,275	341,655	15,105	356,760	341,321	15,262	356,583	349,805	15,212	365,017	353,006	15,651	368,657
Torreón	233,710	26,936	260,646	248,776	26,713	275,489	300,763	19,286	320,049	286,981	17,001	303,982	322,643	16,185	338,828	248,776	26,713	275,489	300,763	19,286	320,049	286,981	17,001	303,982	322,643	16,185	338,828	331,013	23,609	354,622
Zacatecas	99,187	41,538	140,725	109,894	48,931	158,825	116,216	54,061	170,277	117,174	56,673	173,847	121,675	60,988	182,663	109,894	48,931	158,825	116,216	54,061	170,277	117,174	56,673	173,847	121,675	60,988	182,663	169,639	65,919	235,558
Zihuatanejo	157,268	99,637	256,905	173,799	109,500	283,299	172,528	107,990	280,518	188,412	110,427	298,839	177,154	104,657	281,811	173,799	109,500	283,299	172,528	107,990	280,518	188,412	110,427	298,839	177,154	104,657	281,811	208,721	102,746	311,467
Total	6,464,210	896,733	7,360,943	7,416,860	1,081,418	8,498,278	8,333,023	1,077,650	9,410,673	8,753,445	1,088,333	9,841,778	9,712,057	1,097,439	10,809,496	7,416,860	1,081,418	8,498,278	8,333,023	1,077,650	9,410,673	8,753,445	1,088,333	9,841,778	9,712,057	1,097,439	10,809,496	10,443,733	1,194,701	11,638,434

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The following table sets forth the air traffic movement capacity of each of our airports as of December 31, ~~2018:~~2019:

Capacity(1) by Airport(2)


	Peak Air Traffic			Peak Air Traffic
	Movements per	Runway	% Capacity	Movements per	Runway	% Capacity
Airport	Hour	Capacity(3)	Used	Hour	Capacity(3)	Used
Acapulco	6	40	15.0	7	40	17.5
Ciudad Juárez	7	20	35.0	8	20	40.0
Culiacán	8	24	33.3	9	24	37.5
Chihuahua	9	40	22.5	9	40	22.5
Durango	4	40	10.0	4	40	10.0
Mazatlán	9	22	40.9	8	22	36.4
Monterrey	26	38	68.4	26	38	68.4
Reynosa	4	18	22.2	4	18	22.2
San Luis Potosí	6	20	30.0	6	20	30.0
Tampico	5	22	22.7	5	22	22.7
Torreón	6	20	30.0	5	20	25.0
Zacatecas	3	20	15.0	3	20	15.0
Zihuatanejo	7	20	35.0	7	20	35.0

(1)

Capacity is calculated based on Hour 30 (the thirtieth hour of maximum activity during the year).

(2)

~~2018~~2019 figures.

(3)

Air traffic movements per hour.

The following table sets forth the terminal capacity of each of our airports as of December 31, ~~2018:~~2019:

Capacity(1) by Airport(2)


	Peak Passenger			Peak Passenger
	Traffic Movements	Terminal	% Capacity	Traffic Movements	Terminal	% Capacity
Airport	per Hour	Capacity(3)	Used	per Hour	Capacity(3)	Used
Acapulco	528	967	54.6	596	1,096	54.0
Ciudad Juárez	777	621	125.1	890	621	143.3
Culiacán	1,047	938	111.7	1,105	938	117.8
Chihuahua	959	795	120.6	1,039	1,286	80.5
Durango	291	482	60.4	362	482	75.1
Mazatlán	990	1,532	64.6	958	1,537	62.3
Monterrey Terminal A	1,494	2,091	71.4	1,552	2,091	74.2
Monterrey Terminal B	932	1,469	63.4	843	1,469	57.4
Monterrey Terminal C	1,413	1,168	121.0	1,701	1,168	145.6
Reynosa	500	326	153.4	469	326	143.9
San Luis Potosí	424	869	48.8	453	1,380	32.8
Tampico	502	683	73.5	519	683	76.0
Torreón	461	545	84.6	488	545	89.5
Zacatecas	398	571	69.7	435	573	75.9
Zihuatanejo	705	945	74.6	797	945	84.3

(1)

Capacity is calculated based on Hour 30 (the thirtieth hour of maximum activity during the year).

(2)

~~2018~~2019 figures.

(3)

Passenger traffic during peak hours.

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The following table sets forth the air traffic movements for each of our airports for the periods indicated:

Air Traffic Movements by Airport(1)


	For the Year Ended December 31,					For the Year Ended December 31,
	2014	2015	2016	2017	2018	2015	2016	2017	2018	2019
Acapulco	24,616	24,452	23,831	22,838	24,151	24,452	23,831	22,838	24,151	23,606
Ciudad Juárez	13,750	13,699	18,415	16,215	18,512	13,699	18,415	16,215	18,512	19,260
Culiacán	38,848	36,716	38,611	38,018	41,133	36,716	38,611	38,018	41,133	40,750
Chihuahua	30,462	31,336	33,869	29,361	30,760	31,336	33,869	29,361	30,760	30,222
Durango	16,660	17,556	17,324	14,559	15,324	17,556	17,324	14,559	15,324	16,039
Mazatlán	17,082	16,290	19,685	17,424	17,579	16,290	19,685	17,424	17,579	17,342
Monterrey	102,462	114,428	115,593	110,938	114,564	114,428	115,593	110,938	114,564	112,188
Reynosa	12,590	11,705	11,146	8,639	7,278	11,705	11,146	8,639	7,278	6,757
San Luis Potosí	21,780	20,891	21,719	21,605	21,394	20,891	21,719	21,605	21,394	19,813
Tampico	21,478	20,724	20,401	18,702	18,930	20,724	20,401	18,702	18,930	17,219
Torreón	16,820	16,587	17,922	14,842	16,863	16,587	17,922	14,842	16,863	16,912
Zacatecas	8,958	8,987	8,261	6,868	6,903	8,987	8,261	6,868	6,903	7,390
Zihuatanejo	11,688	11,685	11,584	12,343	11,959	11,685	11,584	12,343	11,959	12,582
Total	337,194	345,056	358,361	332,352	345,350	345,056	358,361	332,352	345,350	340,080

(1)

Includes departures and landings.

The following table sets forth the average number of passengers per air traffic movement for each of our airports for the periods indicated:

Average Passengers per Air Traffic Movements by Airport(1)


	For the Year Ended December 31,					For the Year Ended December 31,
	2014	2015	2016	2017	2018	2015	2016	2017	2018	2019
Acapulco	25.7	29.9	30.1	30.0	30.6	29.9	30.1	30.0	30.6	37.1
Ciudad Juárez	55.9	63.1	59.9	72.3	73.7	63.1	59.9	72.3	73.7	82.9
Culiacán	33.7	39.0	44.7	50.2	55.2	39.0	44.7	50.2	55.2	60.3
Chihuahua	31.6	35.4	38.6	48.0	50.6	35.4	38.6	48.0	50.6	56.2
Durango	15.4	18.0	24.5	27.2	27.3	18.0	24.5	27.2	27.3	32.9
Mazatlán	46.2	52.4	49.5	57.1	59.1	52.4	49.5	57.1	59.1	67.0
Monterrey	69.6	73.9	79.4	88.1	93.7	73.9	79.4	88.1	93.7	99.6
Reynosa	37.5	43.3	50.6	56.2	64.2	43.3	50.6	56.2	64.2	71.1
San Luis Potosí	17.2	21.3	23.2	25.6	29.3	21.3	23.2	25.6	29.3	32.5
Tampico	32.1	36.9	35.2	38.4	38.9	36.9	35.2	38.4	38.9	42.9
Torreón	31.1	33.5	36.1	41.7	40.4	33.5	36.1	41.7	40.4	41.9
Zacatecas	31.8	35.6	41.5	50.9	53.1	35.6	41.5	50.9	53.1	64.3
Zihuatanejo	43.5	48.1	48.1	48.4	47.4	48.1	48.1	48.4	47.4	49.7
Average of all airports	43.6	49.0	52.4	59.2	62.4	49.0	52.4	59.2	62.4	68.1

(1)

Includes total passengers divided by total air traffic movements.

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Air Traffic Movements by Aviation Category(1)


	For the Year Ended December 31,		For the Year Ended December 31,
	2017	2018	2018	2019
Commercial aviation	218,774	233,175	233,175	238,630
Charter aviation	1,044	1,006	1,006	916
General aviation and other	112,534	111,169	111,169	100,534
Total	332,352	345,350	345,350	340,080

(1)

Includes departures and landings for all 13 airports.

Metropolitan Destination

Monterrey International Airport

The Monterrey airport is our most important airport based on passenger traffic (including both domestic and international passengers), air traffic movements and contribution to aeronautical revenues. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Monterrey airport was the fourth busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~48.9%~~49.7%, ~~49.7%~~49.8% and ~~49.8%~~48.2%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~9.2 million,~~ 9.8 million, 10.7 million and ~~10.7~~11.2 million, terminal passengers, respectively, were served by the Monterrey airport. Of the terminal passengers in ~~2016, 86.3% were domestic, and 13.7% were international passengers. In~~ 2017, 87.0% were domestic, and 13.0% were international passengers. In 2018, 87.6% were domestic, and 12.4% were international passengers. In 2019, 87.3% were domestic, and 12.7% were international passengers. This airport serves primarily business travelers and is also a hub for the transportation of goods.

A total of 1314 commercial airlines operated at this airport during ~~2018.~~2019. In ~~2018,~~2019, airlines operating at this airport served 4950 direct destinations, including 3233 domestic destinations and 17 international destinations. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Cancún, Guadalajara, Tijuana, Querétaro, ~~Veracruz,~~ El Bajío, Puerto Vallarta, Chihuahua, Toluca, Veracruz, Mérida, Puebla, Hermosillo, Houston, Dallas, Atlanta, Detroit, ~~Chicago,~~ Las Vegas, Chicago, Los Angeles, New York, San Antonio, Miami and Panama City. In ~~2018,~~2019, the principal domestic airlines operating at the airport were VivaAerobus, Interjet, Volaris, Aeroméxico Connect, Aeroméxico and Magnicharters.

The Monterrey airport is located approximately 21 kilometers (13 miles) from the city of Monterrey, which has a population (including its suburbs) of approximately 4.5 million inhabitants. Monterrey is Mexico’s third largest city based on population and is one of Mexico’s most productive industrial centers. It is home to many of Mexico’s largest companies in a wide variety of industries, as well as several major universities. Monterrey is the capital of the state of Nuevo León, the third largest contributor to Mexico’s GDP.

The Monterrey airport operates 24 hours a day. The airport has two operating runways, one with a length of 3,000 meters (9,842 feet) and the other with a length of 1,800 meters (5,905 feet). The airport’s runway capacity is 38 air traffic movements per hour. The airport also has an instrument landing system on runway 29. The airport occupies a total area of 806.2 hectares (3.11 square miles) and has three commercial passenger terminal buildings (Terminal A, B and C for domestic and international flights) with a total area of approximately 61,520 square meters (662,196 square feet). The airport has three platforms for commercial aviation operations, one platform for general aviation operations, one platform for air freight operations and eleven taxiways.

The Terminal A building has a total area of approximately 29,269 square meters (315,049 square feet), of which ~~4,574~~4,847 square meters ~~(49,234~~(52,173 square feet) is commercial space, a ~~17‑~~19‑position apron for commercial aviation, a one‑position apron for air freight, a five‑position apron for general aviation, nine air bridges, an ample boarding lounge for passengers making connections with other flights and other boarding lounges. Terminal A has 15 boarding gates for international or domestic flights and a public parking facility that accommodates ~~2,102~~2,126 vehicles.

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The Terminal B building started operations on September 1, 2010, and is used by Aeroméxico, Aeroméxico Connect and Delta. Terminal B has a total area of approximately 20,568 square meters (221,392 square feet), of which ~~2,983~~3,920 square meters ~~(32,109~~(42,195 square feet) is commercial space. It has two levels plus a mezzanine and includes six air bridges, an 18‑position commercial aviation apron and 14 boarding gates. Terminal B also has a public parking facility that accommodates 650 vehicles.

The Terminal C building has a total area of approximately 11,683 square meters (125,755 square feet), of which ~~1,475~~1,978 square meters ~~(15,877~~(21,291 square feet) is commercial space. This terminal, which commenced operation at year‑end 2006, is used by the low‑cost carrier VivaAerobus. Terminal C has eight boarding gates and serves ~~thirteen~~16 aircraft positions for commercial aviation. In January 2012, we concluded the construction of a new modern access to the Terminal C building, more commercial spaces and an additional baggage‑claim area, with a total area of approximately 3,420 square meters (36,812 square feet). Terminal C has a public parking facility that accommodates ~~434~~719 vehicles.

The Monterrey airport offers air cargo services for imports and exports and serves as a logistical hub for domestic and international air shipping providers. Its current infrastructure servicing air cargo operations includes bonded terminal warehouses. An area of 8,465 square meters (91,117 square feet) has been occupied by ~~United Parcel Service and~~ Federal Express ~~since 2004 and DHL~~ and OMA Carga (which we operate directly) since 2003, United Parcel Service since 2005 and DHL since January 2010. In 2017, OMA Logística (which we also operate directly) started operating a bonded warehouse to facilitate ~~customs~~ for ground cargo ~~operations. The~~operations between customs. Inside the Monterrey airport, ~~offers~~the customs authority has import and export merchandise checkpoint platforms ~~that can service more than 25 trailers,~~and our warehouses offer services for the handling, storage and custody of merchandise, dry cargo, controlled temperature, ~~controlled and x-ray facilities,~~DGR (Dangerous Goods Regulation), X-ray (authorized equipment by TSA), 24/7 surveillance cameras, scales of up to 30 tons, as well as miscellaneous services required for authorized import and export operations, parking for ~~296 vehicles~~logistics and foreign trade users and operational and office facilities for Mexican ~~customs officers. Roadways suitable for trailers and cars that serve the terminal are also available.~~customs.

To allow the future expansion of the Monterrey airport, including its second commercial runway, in 2009, we completed the acquisition of land strategically located adjacent to the Monterrey airport with an aggregate surface area of 777 hectares (3 square miles) for an aggregate price of Ps.1,159,631 thousand (U.S.$88.8 million) (amount expressed in nominal 2009 pesos). The acquired land is classified in our financial statements as land owned by the Company at its acquisition value, presented as a fixed asset. On October 1, 2012, we presented a proposal to the Mexican Bureau of Civil Aviation (currently AFAC)to recover the cost of our investment in the land, meaning that we requested that the Mexican Bureau of Civil Aviation (currently AFAC) recognize the acquired land as part of our future investment in the Monterrey airport concession included in the airport’s required master development program investments, rather than as a fixed asset that we own. On December 4, 2012, we received authorization from the Mexican Bureau of Civil Aviation (currently AFAC)to reallocate Ps.386,538 thousand (amount expressed in nominal 2009 pesos) in investments included in the 2011–2015 master development program for the Monterrey airport. Additionally, during the 2011 master development program review, Ps.77,306 thousand was reallocated due to extraordinary adjustment of the Monterrey airport’s maximum rate under its master development program. We are currently evaluating various possibilities for the recovery of the remaining investment with the Mexican Bureau of Civil Aviation (currently AFAC)at a cost of Ps.695,759 thousand (amount expressed in nominal 2009 pesos), which was not recognized under the 2016–2020 master development program for the Monterrey airport. The actual amounts of recovery are adjusted annually based on the Mexican Producer ~~Index (~~Index.~~Índice Nacional de Precios Productor~~).

In September 2018, we completed a 1,200 square-meter (12,917 square-foot) expansion of the passenger waiting area for regional flights of Terminal B at the Monterrey airport. The new expansion increased the regional waiting area by 280%. The project had a total investment of Ps.125 million, and it started operations on September 8, 2018.

On July 22, 2016, we sold 200,000 square meters (2,152,782 square feet) of vacant land outside the Monterrey airport, which was not required for future aeronautical use, for Ps.30 million. The Acapulco airport owned 58.82% of the vacant land and the Zihuatanejo airport owned 41.18%.

In September 2018, we completed a 1,200 square-meter (12,917 square-foot) expansion of the passenger waiting area for regional flights of Terminal B at the Monterrey airport. The expansion increased the regional waiting area by 280%. The project had a total investment of Ps.125 million, and it started operations on September 8, 2018.

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increase by over 15,000 square meters (161,459 square feet), approximately a 25% increase of then existing terminal space. Certain components of Phase 1 will become operational by the end of 2021, with all of Phase 1 to be completed and operational by late 2022. Phase 2 consists of the construction of a second new wing, increasing terminal space by an additional 16,000 square meters (172,223 square feet). Phase 2 is expected to be completed by 2024. After both phases of the expansion, the Monterrey airport will have an annual capacity of 16.5 million passengers (up from 11.6 million passengers currently), positioning itself as one of the busiest connection centers in northern Mexico.

In the future, we may face competition from Aeropuerto del Norte, an airport near Monterrey operated by a third party pursuant to a concession. Historically, Aeropuerto del Norte has been used solely for general aviation operations. The state of Nuevo León has requested in the past that the Ministry of Communications and Transportation amend Aeropuerto del Norte’s concession to allow it to serve commercial aviation operations. To date, the Ministry of Communications and Transportation has not amended Aeropuerto del Norte’s concession. The Ministry of Communications and Transportation may authorize such an amendment and that commercial aviation flights will operate from Aeropuerto del Norte in the future. In addition, we understand that Aeropuerto del Norte is not capable of accommodating commercial passenger traffic with its current infrastructure.

Tourist Destinations

Acapulco International Airport

The Acapulco airport is our sixth most important airport based on passenger traffic and our ~~eighth~~sixth most important airport based on aeronautical revenues. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Acapulco airport was the 24th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~3.8%~~3.5%, ~~3.5%~~3.4% and ~~3.4%~~3.8%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~718,493,~~ 685,124, 739,120 and ~~739,120~~875,315 terminal passengers, respectively, were served by the Acapulco airport. Of the terminal passengers in ~~2016, 92.5% were domestic, and 7.5% were international. In~~ 2017, 92.2% were domestic, and 7.8% were international. In 2018, 92.2% were domestic, and 7.8% were international. In 2019, 93.1% were domestic, and 6.9% were international. Because the airport’s passengers are predominantly tourists, the airport’s passenger traffic and results of operations are highly seasonal and affected by Mexican and international economic conditions.

A total of 1112 airlines ~~(nine~~(ten commercial airlines and two charter airlines) operated at this airport during ~~2018.~~2019. In ~~2018,~~2019, airlines operating at this airport served ten direct destinations, including ~~six~~seven domestic destinations and ~~four~~three international destinations. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Tijuana, Toluca, Monterrey and ~~Toluca.~~Guadalajara. In ~~2018,~~2019, the principal domestic airlines operating at the airport were Interjet, Aeroméxico Connect, ~~Interjet,~~ Volaris, Aeromar, VivaAerobus, TAR and Aeroméxico.

The Acapulco airport is located approximately 15 kilometers (9 miles) from the city of Acapulco in the state of Guerrero, which has a population (including its suburbs) of 886,975. Guerrero is Mexico’s 12th largest state based on population, and the city of Acapulco is one of Mexico’s most recognized tourist destinations, of particular importance as a port of embarkation and disembarkation for cruise ships. We believe that these cruise ship passengers represent a significant portion of the airport’s terminal passengers.

The Acapulco airport operates 24 hours a day. The airport has two operating runways and six taxiways. The principal runway has a length of 3,300 meters (10,827 feet), and the auxiliary runway has a length of 1,700 meters (5,577 feet). The apron servicing commercial aviation accommodates 1517 airplanes, and the general aviation apron accommodates 24 aircrafts.

The runway capacity at the Acapulco airport is 40 air traffic movements per hour. The airport also has two instrument landing systems for landing in low visibility on runways 10 and 28, which provide precise guidance to assist aircraft during landing. The airport occupies a total area of 422.2 hectares (1.63 square miles) with a total terminal space of ~~15,347~~15,436 square meters ~~(165,194~~(166,151 square feet), of which ~~1,806~~2,063 square meters ~~(19,440~~(22,206 square feet) is commercial space. Besides having the instrument landing system, runways 10 and 28 have approach lights and flashes on both headers. The Acapulco airport has a public parking facility that accommodates 110 vehicles.

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Due to its technical and geographic characteristics, the Acapulco airport is the primary alternate airport of Mexico City. The length of the airport’s runway as well as its elevation and average temperature makes it possible to operate airplanes at their maximum passenger, freight and fuel capacities.

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In May 2018, we inaugurated a new terminal building at Acapulco airport that has an 18,800 square-meter (202,362 square-foot) surface, with three levels and a mezzanine. The new terminal has the capacity to serve 1.3 million passengers per year. The project had a total investment of Ps.615 million since July 2016.

Mazatlán International Airport

The Mazatlán airport is our fifth most important airport based on passenger traffic. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Mazatlán airport was the 1820th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~5.2%~~5.1%, ~~5.1%~~4.8% and ~~4.8%~~5.0%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~973,440,~~ 994,283, 1,038,555 and ~~1,038,555~~1,161,155 terminal passengers, respectively, were served by the Mazatlán airport. Of the terminal passengers in ~~2016, 71.4% were domestic, and 28.6% were international. In~~ 2017, 70.0% were domestic, and 30.0% were international. In 2018, 71.2% were domestic, and 28.8% were international. In 2019, 73.0% were domestic, and 27.0% were international. The airport’s passengers are predominantly domestic tourists who come from Mexico City, Monterrey and Tijuana, among other cities, and international tourists who come primarily from the United States and Canada. Because the airport’s passengers are predominantly tourists, the airport’s passenger traffic and results of operations are highly seasonal and affected by Mexican and international economic conditions.

A total of 1517 airlines operate at the airport ~~(13~~(15 commercial airlines and two charter airlines). In ~~2018,~~2019, airlines operating at this airport served 2524 direct destinations, including ten domestic destinations and ~~fifteen~~fourteen international destinations. Of these destinations, Mexico City, Tijuana, Monterrey, ~~Tijuana,~~ San José del Cabo, La Paz, ~~Chihuahua,~~Cabo San Lucas, Ciudad Juárez, Hermosillo, Culiacán and ~~Guadalajara~~Querétaro were the main domestic routes. The main international destinations served by this airport were Los Angeles, Phoenix, Dallas and ~~Dallas~~Minneapolis in the United States and Calgary, Edmonton, Vancouver and ~~Edmonton~~Abbotsford in Canada. In ~~2018,~~2019, the principal commercial domestic airlines operating at this airport were VivaAerobus, Volaris, Aeroméxico Connect, ~~Volaris,~~ Interjet, Magnicharters, Aerocalafia, ~~Magnicharter,~~ TAR and Aeroméxico.

The Mazatlán airport is located approximately 18 kilometers (11 miles) from the city of Mazatlán, which has a population of 502,547. Mazatlán is the principal tourist destination of the Sinaloa region, with about ~~9,626~~9,859 hotel rooms, according to the Mexican Ministry of Tourism (Secretaría de Turismo). Mazatlán offers attractive beaches and is also a major producer of shrimp, sardines and tuna.

The Mazatlán airport operates 24 hours a day. Its runway capacity is 22 air traffic movements per hour. The airport occupies approximately 439.8 hectares (1.70 square miles) of land. The airport’s facilities include a terminal building with a total area of ~~18,835~~18,444 square meters ~~(202,738~~(198,530 square feet), of which ~~1,973~~2,498 square meters ~~(21,237~~(26,888 square feet) is commercial space. The airport has a commercial aviation apron with 10 positions and a general aviation apron with 24 positions. In addition, the airport has four air bridges and a public parking facility that accommodates 157 vehicles. The airport’s runway is 2,702 meters (8,865 feet) long, with four taxiways that connect the commercial and general aviation platforms and includes an instrument landing system on runway 26.

In 2014, the terminal building was expanded by 2,300 square meters (24,757 square feet) and 2,500 square meters (26,919 square feet) of space were refurbished, including the main façade of the airport, waiting area, check‑in and inspection points, restrooms and offices. Commercial spaces were also expanded.

Zihuatanejo International Airport

The Zihuatanejo airport is our tenth most important airport based on passenger traffic. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Zihuatanejo airport was the 3231ndst busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately 3.0%, ~~3.0%~~2.6% and ~~2.6%~~2.7%, respectively, of our terminal passenger traffic.

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In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~557,389,~~ 597,902, 566,497 and ~~566,497~~625,186 terminal passengers, respectively, were served by the Zihuatanejo airport. Of the terminal passengers in ~~2016, 59.7% were domestic, and 40.3% were international. In~~ 2017, 61.2% were domestic, and 38.8% were international. In 2018, 60.9% were domestic, and 39.1% were international. In 2019, 64.9% were domestic, and 35.1% were international. Because the airport’s passengers are predominantly tourists, the airport’s passenger traffic and results of operations are seasonal and are affected by Mexican and international economic conditions.

A total of 1816 airlines operate at the airport (13 commercial airlines and ~~five~~three charter airlines). In ~~2018,~~2019, airlines operating at this airport served 2218 direct destinations, including ~~seven~~five domestic destinations and 1513 international destinations. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, ~~Querétaro,~~ Tijuana, Monterrey, Querétaro, Toluca, Los Angeles, Calgary, Houston, Vancouver, Phoenix and ~~Phoenix.~~Toronto. In ~~2018,~~2019, the principal domestic airlines operating at this airport were Interjet, Aeroméxico Connect, Volaris, Aeromar, ~~Volaris,~~ VivaAerobus, Magnicharters, TAR, ~~Margnicharter~~ and Aeroméxico and the non-Mexican airlines included Alaska Airlines, WestJet, United, ~~Delta~~American Airlines and ~~American Airlines.~~ Delta.

The Zihuatanejo airport is located approximately 12 kilometers (7 miles) from the city of Zihuatanejo. Situated in the state of Guerrero, with a population of 124,824 people, the city of Zihuatanejo is one of Mexico’s most attractive tourist destinations, with approximately ~~6,273~~6,282 hotel rooms, according to the Ministry of Tourism, a marina, world‑class golf courses and a growing residential real estate market.

The Zihuatanejo airport operates 14 hours a day. The airport has one runway, which is 2,506 meters (8,222 feet) long with a runway capacity of 20 air traffic movements per hour. The airport’s facilities include a terminal building encompassing an area of 11,336 square meters (122,020 square feet), including ~~1,089~~1,463 square meters ~~(11,722~~(15,748 square feet) of commercial space. It has a six‑position commercial aviation apron, a 23‑position general aviation apron and two taxiways. The Zihuatanejo airport has a public parking facility that accommodates 140 vehicles.

The quality of services offered at the Zihuatanejo airport has improved as a result of the rehabilitation of its runway, the remodeling and expansion of the departure gate area and the reconfiguration of the passenger and carry‑on luggage screening area, which were completed on July 14, 2016.

Regional Destinations

Chihuahua International Airport

The Chihuahua airport is our third most important airport based on passenger traffic and air traffic movements and our third most important airport based on aeronautical revenues. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Chihuahua airport was the 12th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~7.0%~~7.2%, 7.2% and ~~7.2%~~7.3%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~1,305,961,~~ 1,409,579, 1,556,770 and ~~1,556,770~~1,699,816 terminal passengers, respectively, were served by the Chihuahua airport. Of the terminal passengers in ~~2016, 91.7% were domestic, and 8.3% were international. In~~ 2017, 92.1% were domestic, and 7.9% were international. In 2018, 92.2% were domestic, and 7.8% were international. In 2019, 92.1% were domestic, and 7.9% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of ten commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served 1618 direct destinations, including ~~thirteen~~fourteen domestic destinations and ~~three~~four international destinations. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Monterrey, Guadalajara, Cancún, Tijuana, Hermosillo, Querétaro, ~~Culiacán, Hermosillo, Ciudad Juárez,~~Mérida, Dallas, Houston and Denver. In ~~2018,~~2019, the principal domestic airlines operating at this airport were Volaris, Aeroméxico Connect, ~~Volaris,~~ VivaAerobus, Interjet, TAR and Aeroméxico and the principal non‑Mexican airlines were American Airlines and United.

The Chihuahua airport is located approximately 18 kilometers (11 miles) from the city of Chihuahua, the capital of the state of Chihuahua. The city’s population is 878,062. Chihuahua’s close proximity to the United States and its highly developed maquiladora industry account for the majority the airport’s incoming and outgoing traffic.

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The Chihuahua airport operates 14 hours a day. The airport has three runways, with lengths of 2,600 meters (8,530 feet), 2,420 meters (7,940 feet) and 1,100 meters (3,609 feet), respectively. The runway system has a capacity of 40 air traffic movements per hour. The airport also has an instrument landing system on runway 36. The airport occupies a total area of approximately 909.2 hectares (3.51 square miles). The airport’s facilities include a terminal building with a total area of approximately 7,951 square meters (85,584 square feet), including ~~1,060~~1,925 square meters ~~(11,410~~(20,720 square feet) of commercial space, a seven‑position apron for commercial aviation, two aprons with a total of 21 positions for general aviation, four taxiways, a one‑position apron for airfreight and one air bridge. The airport has six gates for international or domestic flights. The Chihuahua airport has a public parking facility that accommodates 475 vehicles.

To accommodate growing demand for airfreight services and an expanding local economy, in August 2005 we completed the construction of a cargo area, which includes a warehouse, a customs platform and office, x‑ray zones, storage areas and logistics offices. We currently operate all international cargo operations at this airport directly.

In December 2016, we started an expansion and remodeling of the terminal building at the Chihuahua ~~airport.~~airport, which was completed on September 17, 2019. The project includes a 15,000 square meters (161,459 square feet) terminal expansion, plus renovation of 9,000 square meters (96,875 square feet) of the existing building. These improvements will increase the airport’s capacity to 1.6 million passengers per year. The project will havehad a total investment of ~~Ps.308~~Ps.318 million ~~to be executed over 30 months.~~and included 5,743 square meters (61,817 square feet) of new areas and the remodeling of 9,510 square meters (102,365 square feet).

Culiacán International Airport

The Culiacán airport is our second most important airport based on passenger traffic, air traffic movements and contribution to aeronautical revenues. According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Culiacán airport was the 10th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~9.2%~~9.7%, ~~9.7%~~10.5% and ~~10.5%~~10.6%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~1,726,654,~~ 1,909,651, 2,270,834 and ~~2,270,834~~2,458,863 terminal passengers, respectively, were served by the Culiacán airport. Of the terminal passengers in ~~2016, 98.4% were domestic, and 1.6% were international. In~~ 2017, 98.5% were domestic, and 1.5% were international. In 2018, 98.7% were domestic, and 1.3% were international. In 2019, 98.5% were domestic, and 1.5% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are highly affected by Mexican economic conditions.

The airport’s terminal passenger traffic consists predominantly of commercial aviation. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, commercial aviation accounted for approximately ~~97.1%~~98.2%, ~~98.2%~~99.8% and 99.8%, respectively, and general aviation accounted for approximately ~~2.9%~~1.8%, ~~1.8%~~0.2% and 0.2%, respectively, of the airport’s terminal passenger traffic.

A total of seven commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served eleven domestic destinations: Tijuana, Mexico City, Guadalajara, Monterrey, Mexicali, San José del Cabo, La Paz, ~~Hermosillo, Chihuahua,~~ Ciudad Juárez, ~~and~~Hermosillo, Chihuahua, Cabo San Lucas and one international destination to Phoenix. In ~~2018,~~2019, the domestic airlines operating at this airport were Volaris, VivaAerobus, ~~Interjet,~~ Aeroméxico Connect, Interjet, Aerocalafia, TAR and Aeroméxico.

The Culiacán airport is located approximately 14 kilometers (9 miles) from the city of Culiacán. The population of the whole municipality is 1,059,617. Culiacán is the capital of the state of Sinaloa, an important producer of beef and agricultural products. The potential for growth of exports to the United States could generate an increase in cargo operations at this airport, though growth may not occur, and therefore cargo operations may not increase as a result thereof.

The Culiacán airport operates 16 hours a day. ~~Its~~The runway has a length of 2,227 meters (7,306 feet) and capacity isof 24 air traffic movements per hour. The airport occupies a total area of 280.9 hectares (1.08 square miles). The airport’s facilities include a terminal building expanded in 2012 with a total area of approximately 11,250 square meters (121,094 square feet), including ~~1,767~~2,099 square meters ~~(19,020~~(22,593 square feet) of commercial space, a seven‑position apron for commercial aviation, a 57‑position apron for general aviation, six taxiways and two air bridges. The Culiacán airport has a public parking facility that accommodates 343 vehicles.

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The Culiacán airport also includes military installations. The presence of these installations amid their operational activity may at some point affect the airport’s runway capacity at peak hours, thus affecting its civil aviation operations.

Durango International Airport

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the Durango airport accounted for approximately ~~2.3%~~2.0%, ~~2.0%~~1.9% and ~~1.9%~~2.3%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~424,415,~~ 395,905, 418,914 and ~~418,914~~527,004 terminal passengers, respectively, were served by the Durango airport. Of the terminal passengers in ~~2016, 88.5% were domestic, and 11.5% were international. In~~ 2017, 85.5% were domestic, and 14.5% were international. In 2018, 86.7% were domestic, and 13.3% were international. In 2019, 82.1% were domestic, and 17.9% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of five commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served ~~seven~~nine direct destinations, including ~~five~~six domestic destinations and ~~two~~three international destinations: Mexico City, Tijuana, Monterrey, Guadalajara, ~~Monterrey,~~ Ciudad Juárez, Querétaro, Dallas, Chicago and Los Angeles. In ~~2018,~~2019, the domestic airlines operating at this airport were Aeroméxico Connect, Volaris, TAR and VivaAerobus and ~~Aeroméxico. As of~~ the ~~date of this annual report, the airport does not have any active non-Mexican airlines.~~principal non Mexican airline was American Airlines.

The Durango airport is located approximately 16 kilometers (10 miles) from the City of Durango, which has a population of 654,876. The state of Durango is rich in natural resources and is Mexico’s leading producer of gold, silver, lead and zinc.

The Durango airport operates 14 hours a day. The airport’s runway is 2,900 meters (9,514 feet) long. The runway has five taxiways and a capacity of 40 air traffic movements per hour.

The airport’s total area is 541.4 hectares (2.09 square miles). Its facilities include a 3,855 square-meter (41,495 square-foot) terminal building with ~~193~~272 square meters ~~(2,077~~(2,928 square feet) of commercial space. It has a four‑position commercial aviation apron, a ~~16‑~~33‑position general aviation apron and a ~~146‑~~343 space public parking area. The airport has ~~one~~three boarding ~~gate~~gates for international or domestic flights.

San Luis Potosí International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the San Luis Potosí airport was the 30th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the San Luis Potosí airport accounted for approximately ~~2.7%~~2.8%, ~~2.8%~~2.9% and ~~2.9%~~2.8%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~504,313,~~ 553,353, 626,512 and ~~626,512~~643,224 terminal passengers, respectively, were served by the San Luis Potosí airport. Of the terminal passengers in ~~2016, 71.0% were domestic, and 29.0% were international. In~~ 2017, 71.6% were domestic, and 28.4% were international. In 2018, 72.0% were domestic, and 28.0% were international. In 2019, 70.6% were domestic, and 29.4% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions. A total of eight commercial airlines operate at the airport: Aeroméxico Connect, Volaris, Aeromar, ~~Interjet,~~ TAR, VivaAerobus, Magnicharters, American ~~Eagle~~Airlines and United. In ~~2018,~~2019, airlines operating at this airport served ~~eight~~seven destinations, including ~~six~~five domestic destinations and two international destinations. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Cancún, Tijuana, Monterrey, ~~Tijuana,~~ Puerto Vallarta, ~~Aguascalientes,~~ Dallas and ~~Houston.~~Houston .

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The San Luis Potosí airport operates 24 hours per day and is located approximately 15 kilometers (9 miles) from the city of San Luis Potosí, which is the capital of the state of San Luis Potosí and has a population of 824,229. The airport has two runways with a total capacity of 20 air traffic movements per hour. The principal runway is 3,006 meters (9,862 feet) long, and the secondary runway is 1,000 meters (3,281 feet) long. The airport has a total area of 508.3 hectares (1.96 square miles). The airport’s facilities include a terminal building with approximately ~~7,170~~11,042 square meters ~~(77,177~~(118,855 square feet), including ~~654~~1,255 square meters ~~(7,040~~(13,509 square feet) of commercial space, a five‑position platform for commercial aviation, two aprons with a total of 24 positions for general aviation, four taxiways, a boarding lounge with five gates and a public parking facility that accommodates 222 vehicles. The airport’s navigational aids include precision approach path indicators, VHF omnidirectional radio and an instrument landing system on runway 14.

In November 2016, we started an expansion and remodeling of the terminal building at the San Luis Potosí ~~airport.~~airport, which was completed on August 16, 2019. The project ~~includes~~had a ~~12,800~~total investment of Ps.400 million and included an expansion of 8,600 square meters ~~(137,778~~(92,570 square feet) ~~terminal expansion, renovation~~, for a total of ~~4,000~~13,482 square meters ~~(43,056~~(145,119 square feet) ~~of the existing building and a new passenger boarding bridge. These improvements will increase the airport terminal’s~~. Passenger capacity grew threefold to serve up to 1.2 million passengers per year. ~~The project will have a total investment of Ps.400 million, to be executed over 31 months. An initial phase of the expansion started operations in August 2018.~~

Tampico International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Tampico airport was the 2527th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, it accounted for approximately ~~3.8%~~3.6%, ~~3.6%~~3.4% and ~~3.4%~~3.2%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018~~2019 a total of ~~717,599,~~ 717,342, 736,627 and ~~736,627~~739,143 terminal passengers, respectively, were served by the Tampico airport. Of the terminal passengers in ~~2016, 94.0% were domestic, and 6.0% were international. In~~ 2017, 93.9% were domestic, and 6.1% were international. In 2018, 92.8% were domestic, and 7.2% were international. In 2019, 92.7% were domestic, and 7.3% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of five commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served nine direct destinations, including eight domestic destinations and one international destination: Mexico City, Monterrey, Cancún, Villahermosa, Guadalajara, ~~Veracruz,~~ Ciudad del Carmen, Veracruz, Querétaro and Houston. In ~~2018,~~2019, the domestic airlines operating at the airport were VivaAerobus, Interjet, Aeroméxico Connect and TAR, and the non-Mexican airline was United.

The Tampico airport serves the industrial zone of Tampico, Ciudad Madero and Altamira, which have a combined population of 758,659. This industrial zone is home to companies in the petroleum and chemical industries.

The Tampico airport operates Monday, Wednesday and Friday from 6:30 a.m. to 9:30 p.m. (local time) and from 6:30 a.m. to 9:00 p.m. on Sunday, Tuesday, Thursday and Saturday. The airport has three runways in operation. The principal runway is 2,550 meters (8,366 feet) long, the second runway is 1,221 meters (4,006 feet) in length, and the third runway (used exclusively for Alpha (A) category aircraft and visual flights) is 1,200 meters (3,937 feet) long. The airport has a capacity of 22 air traffic movements per hour and includes an instrument landing system, which provides precise guidance to assist aircraft during landing.

The airport’s total area is 372.5 hectares (1.44 square miles). Its facilities include a ~~6,833‑square‑meter (73,550‑square‑foot)~~6,833 square-meter (73,550 square-foot) terminal building, of which ~~762~~826 square meters ~~(8,202~~(8,891 square feet) are commercial spaces. It has a ~~five‑~~six position apron for commercial aviation, a ~~17‑~~17 position apron for general aviation, two taxiways and four boarding gates. The Tampico airport has a public parking facility that accommodates 254 vehicles.

In December 2017, we started an expansion and remodeling of the terminal building at the Tampico airport. The project will have a total investment of approximately Ps.175 million. After the project concludes total area will be 7,981 square meters (85,907 square feet), an increase of approximately 17%.

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Torreón International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Torreón airport was the 29th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the Torreón airport accounted for approximately ~~3.4%~~3.1%, ~~3.1%~~3.2% and 3.2%, respectively, of our terminal passenger traffic.

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In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~646,898,~~ 618,930, 681,551 and ~~681,551~~708,563 terminal passengers, respectively, were served by the Torreón airport. Of the terminal passengers in ~~2016, 91.5% were domestic, and 8.5% were international. In~~ 2017, 91.2% were domestic, and 8.8% were international. In 2018, 91.3% were domestic, and 8.7% were international. In 2019, 90.0% were domestic, and 10.0% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of ~~eight~~seven commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served ~~eight~~seven direct destinations, including ~~seven~~six domestic destinations and one international destination. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Guadalajara, Cancún, Tijuana, ~~Cancún,~~Querétaro, Ciudad Juárez ~~Querétaro, Monterrey~~ and Dallas. In ~~2018,~~2019, the domestic airlines operating at the airport were Aeroméxico Connect, VivaAerobus, Interjet, Volaris, TAR and Aeroméxico, and the non-Mexican airline was American Airlines.

The Torreón airport is located in the city of Torreón, which is part of the La Laguna region, Mexico’s top dairy‑producing region and an important industrial and commercial region. Approximately 679,288 people live in the city of Torreón, and approximately 1.3 million people live in La Laguna region.

The Torreón airport operates 14 hours a day. The airport has two runways. The principal runway measures 2,755 meters (9,038 feet) in length, and the secondary runway measures 1,467 meters (4,813 feet) in length. The airport has a runway capacity of 20 air traffic movements per hour.

The airport’s total area is 354.6 hectares (1.37 square miles). Its facilities include a terminal building of 5,447 square meters (5,863 square feet), of which ~~486~~732 square meters ~~(5,231~~(7,879 square feet) are commercial space, ana seven‑position apron for commercial aviation, a seven‑position apron for general aviation, one taxiway, five boarding gates, several VIP lounges and one air bridge. The Torreón airport has a public parking facility that accommodates 142 vehicles.

Zacatecas International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Zacatecas airport was the 35th busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the Zacatecas airport accounted for approximately 1.8%, ~~1.8%~~1.7% and ~~1.7%~~2.1%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~343,136,~~ 349,453, 366,871 and ~~366,871~~475,241 terminal passengers, respectively, were served by the Zacatecas airport. Of the terminal passengers in ~~2016, 65.0% were domestic, and 35.0% were international. In~~ 2017, 63.3% were domestic, and 36.7% were international. In 2018, 62.4% were domestic, and 37.6% were international. In 2019, 69.0% were domestic, and 31.0% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of four commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served six direct destinations, including two domestic destinations and four international destinations: Mexico City, Tijuana, Los Angeles, Chicago, San José, California and Dallas.

In ~~2018,~~2019, the domestic airlines operating at this airport were Volaris, Aeroméxico Connect and VivaAerobus, and the non-Mexican airline was American Airlines.

Located in the center of Mexico, the state of Zacatecas (of which the city of Zacatecas is the capital) is Mexico’s leading silver producer and second leading producer of lead, copper, zinc and gold. The state of Zacatecas has a population of approximately 1.6 million.

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The airport currently operates 24 hours a day. The airport has one runway, which measures 3,000 meters (9,843 feet) in length. The runway capacity is 20 air traffic movements per hour.

The airport’s total area is 207.6 hectares (0.80 square miles). The terminal building is 5,707 square meters (61,430 square feet), of which ~~402~~491 square meters ~~(4,327~~(5,285 square feet) is commercial area. It has a four‑position apron for commercial aviation, a 14‑position apron for general aviation, three boarding gates and a parking lot with 202 parking spaces.

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In 2012, we built a solar park at Zacatecas airport with an installed capacity of 200 Kw in a land area of approximately 4,000 square meters (43,056 square feet), which in ~~2018~~2019 generated approximately ~~297,943~~322,455 Kw/h for the airport, equivalent to approximately ~~58%~~37% of the airport’s total electricity requirements.

Border Destinations

Ciudad Juárez International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Ciudad Juárez airport was the 1513th busiest airport in Mexico in ~~2018~~2017 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the Ciudad Juárez airport accounted for approximately ~~5.9%~~6.0%, ~~6.0%~~6.3% and ~~6.3%~~6.9%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~1,102,855,~~ 1,173,135, 1,364,028 and ~~1,364,028~~1,597,471 terminal passengers, respectively, were served by the Ciudad Juárez airport. Of the terminal passengers in ~~2016,~~ 2017, 2018 and ~~2018, 99.2%~~2019, 99.8%, ~~99.8%~~99.7% and ~~99.7%~~99.6%, respectively, were domestic.

A total of six commercial airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served 13 direct destinations, all of which were domestic. In ~~2018,~~2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Guadalajara, Monterrey, El Bajío, Cancún, Tijuana, ~~Chihuahua,~~Culiacán, Hermosillo, ~~Culiacán,~~Chihuahua, Torreón, Durango, Mazatlán and Querétaro. In ~~2018,~~2019, the domestic airlines operating at the airport were VivaAerobus, Volaris, Aeroméxico Connect, ~~Volaris,~~ Interjet, TAR and Aeroméxico. As of the date of this annual report, the airport does not have any active non-Mexican airlines.

The airport is located in the city of Ciudad Juárez, which is near the U.S. border and has a population of 1,391,180. The city is a major center of the maquiladora industry. Because Ciudad Juárez is a popular entry point to the United States many of the airport’s passengers consist of Mexican migrant workers traveling to Ciudad Juárez in order to seek work in the United States. Although the airport’s passengers are predominantly domestic, its passenger traffic and results of operations are affected by economic conditions in both Mexico and the United States.

The Ciudad Juárez airport operates 14 hours a day. The airport has two runways. The principal runway measures 2,700 meters (8,858 feet) in length, and the secondary runway measures 1,710 meters (5,610 feet) in length. The airport has a capacity of 20 air traffic movements per hour.

The airport’s total area is 367.95 hectares (1.42 square miles). Its facilities include a terminal building of 6,210 square meters (66,844 square feet), consisting of ~~1,767~~964 square meters ~~(19,020~~(10,376 square feet) of commercial space, five boarding gates and two air bridges. The airport has a ~~seven‑~~six‑position commercial aviation apron, a 15‑position general aviation apron, a one‑position freight services apron and three taxiways. The Ciudad Juárez International Airport has a public parking facility that accommodates 300 vehicles.

Reynosa International Airport

According to the ~~Mexican Bureau of Civil Aviation,~~AFAC, the Reynosa airport was the 3334rd busiest airport in Mexico in ~~2018~~2019 based on commercial and general aviation passenger traffic. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, the Reynosa airport accounted for approximately ~~3.0%~~2.5%, ~~2.5%~~2.2% and ~~2.2%~~2.1%, respectively, of our terminal passenger traffic.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, a total of ~~563,952,~~ 485,727, 466,934 and ~~466,934~~480,524 terminal passengers, respectively, were served by the Reynosa airport. Of the terminal passengers in ~~2016,~~ 2017, 2018 and ~~2018, 99.9%~~2019, 99.3%, ~~99.3%~~99.2% and 99.2%, respectively,

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were domestic. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of two airlines operate at the airport. In ~~2018,~~2019, airlines operating at this airport served four direct destinations, all of which are domestic destinations: Mexico City, Cancún, Guadalajara and ~~Veracruz .~~Veracruz. In ~~2018,~~2019, the domestic airlines operating at this airport were VivaAerobus and Aeroméxico Connect.

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The airport is located in Reynosa, a city with a population of 646,202 inhabitants bordering the United States near the Gulf of Mexico. We believe that Reynosa’s robust industrial economic activity and proximity to the United States create the potential for growth in air cargo services. Because Reynosa is a popular entry point to the United States, many of the airport’s passengers consist of Mexican migrant workers traveling to Reynosa in order to seek work in the United States. Although the airport’s passengers are predominantly domestic, its passenger traffic and results of operations are affected by economic conditions in both Mexico and the United States.

The Reynosa airport operates 12 hours a day. The airport has one runway, which is 1,893 meters (6,211 feet) in length and has a runway capacity of 18 air traffic movements per hour.

The airport’s total area is approximately 407.4 hectares (1.57 square miles). The terminal building is 2,608 square meters (28,072 square feet), which includes 256 square meters (2,756 square feet) of commercial area. It has a four‑position apron for commercial aviation, an 11‑position apron for general aviation, two taxiways, three boarding gates and a public parking area with 270 spaces.

In December 2016, we started construction of a new terminal building at Reynosa airport. The new terminal building is ~~270%~~191% larger than the existing one and will increase the airport terminal’s capacity to ~~more than~~approximately one million passengers per year. The project will have a total investment of ~~Ps.302~~Ps.325 million, and is expected to ~~be executed over 30 months.~~start operations in the first half of 2020.

Principal Aeronautical Services Customers

Airline Customers

As of December 31, ~~2018,~~2019, over 12 international commercial airlines and nine Mexican commercial airlines operated flights at our 13 airports. VivaAerobus and Grupo Aeroméxico ~~and VivaAerobus~~ operated the most flights at our airports, followed by Volaris, Interjet ~~Volaris~~ and TAR. In ~~2018,~~2019, revenues from VivaAerobus were Ps.1,285,954 thousand (U.S.$68.1 million), revenues from Grupo Aeroméxico and its affiliates were ~~Ps.1,257,476~~Ps.1,255,147 thousand (U.S.$~~64.0 million), revenues from VivaAerobus were Ps.1,087,174 thousand (U.S.$55.3~~66.5 million), revenues from Volaris totaled ~~Ps.900,066~~Ps.1,177,915 thousand (U.S.$~~45.8~~62.4 million) and revenues from Interjet were ~~Ps.730,539~~Ps.761,076 thousand (U.S.$~~37.2~~40.3 million), representing ~~24.5%~~22.4%, ~~21.2%~~21.8%, ~~17.5%~~20.5% and ~~14.2%~~13.2%, respectively, of our aeronautical revenues from airline customers for ~~2018.~~2019. These revenues were earned from passenger charges, landing charges, aircraft parking charges and the leasing of space to these airlines.

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The following table sets forth the number of air traffic customers per airline for the years ended December 31, ~~2016,~~ 2017, 2018 and ~~2018:~~2019:


	Terminal Passengers			Terminal Passengers
Principal Air Traffic Customers Per Airline	2016	2017	2018	2017	2018	2019
Domestic:
Viva Aerobus	3,931,006	4,786,803	5,668,700
VivaAerobus				4,786,803	5,668,700	6,666,650
Grupo Aeroméxico	5,052,206	5,113,728	5,524,016	5,113,728	5,524,016	5,079,229
Volaris	3,705,830	3,706,882	4,189,679	3,706,882	4,189,679	5,300,929
Interjet	3,127,715	3,096,444	3,137,721	3,096,444	3,137,721	3,045,049
TAR Aerolíneas	375,762	381,377	486,151	381,377	486,151	437,626
Other	629,026	641,633	781,732	641,633	781,732	827,597
Total domestic	16,821,545	17,726,867	19,787,999	17,726,867	19,787,999	21,357,080

International:
American Airlines	504,782	504,782	516,367	504,782	516,367	544,886
United	494,547	494,547	494,861	494,547	494,861	507,277
Delta	260,700	260,700	203,812	260,700	203,812	192,509
Alaska Airlines	124,430	124,430	131,119	124,430	131,119	145,414
Sunwing Airlines	64,648	64,648	79,853	64,648	79,853	85,996
Other	157,794	210,128	149,566	210,128	149,566	165,887
Total international	1,606,901	1,659,235	1,575,578	1,659,235	1,575,578	1,641,969

General aviation	335,192	275,912	202,822	275,912	202,822	169,011
Total	18,763,638	19,662,014	21,566,399	19,662,014	21,566,399	23,168,060

Historically, traditional carriers such as Aeroméxico had represented a substantial majority of the Mexican commercial airline market. In recent years, however, international carriers, discount carriers, low‑cost carriers and other new market entrants have represented a growing proportion of the Mexican commercial airline market. In ~~2018,~~2019, passengers traveling on discount and low‑cost carriers, such as VivaAerobus, Interjet and Volaris, accounted for approximately ~~60.8%~~65.3% of our commercial aviation passenger traffic. Since air transportation historically has been affordable only to the higher income segments of Mexico’s population, resulting in a comparatively low level of air travel, we believe that the entry of low‑cost and discount carriers into the Mexican commercial airline market has helped to increase the use of air transportation in Mexico.

Aeroméxico ~~was previously owned by the Mexican government. In November 2007, the Mexican Government, through NAFIN~~is a publicly traded company and ~~IPAB (Instituto para la Protección al Ahorro Bancario) sold all~~Delta Airlines currently owns approximately 50.7% of ~~its remaining ownership interest in~~ Aeromé~~xico and its affiliates to a group of investors led by~~ ~~Banco Nacional de México~~ ~~(“Banamex”).~~xico.

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The following table sets forth our principal air traffic customers for the years ended December 31, ~~2016,~~ 2017, 2018 and ~~2018:~~2019:


	Percentage of Aeronautical Revenues						Percentage of Aeronautical Revenues
Principal Air Traffic Customers	2016		2017		2018		2017		2018		2019
Domestic:
Grupo Aeroméxico (Aeroméxico and Aeroméxico Connect)	24.7	%	24.2	%	24.5	%	24.2	%	24.5	%	24.5	%
VivaAerobus	17.6	%	19.4	%	21.2	%	19.4	%	21.2	%	21.2	%
Volaris	17.3	%	16.7	%	17.5	%	16.7	%	17.5	%	17.5	%
Interjet	15.4	%	14.8	%	14.2	%	14.8	%	14.2	%	14.2	%
TAR	1.7	%	1.7	%	2.1	%	1.7	%	2.1	%	2.1	%
Grupo Aeromonterrey (Magnicharters)	1.9	%	1.8	%	1.9	%	1.8	%	1.9	%	1.9	%
Aeromar	1.0	%	0.8	%	0.8	%	0.8	%	0.8	%	0.8	%
Calafia Airlines	0.6	%	0.5	%	0.5	%	0.5	%	0.5	%	0.5	%
DHL Express México	0.3	%	0.3	%	0.3	%	0.3	%	0.3	%	0.3	%
Other	4.6	%	4.8	%	4.1	%	4.8	%	4.1	%	4.1	%
Total domestic	85.1	%	85.0	%	87.1	%	85.0	%	87.1	%	87.1	%

International:
American Airlines	4.9	%	4.8	%	4.3	%	4.8	%	4.3	%	4.3	%
United	4.7	%	4.7	%	4.1	%	4.7	%	4.1	%	4.1	%
Delta	2.2	%	2.1	%	1.4	%	2.1	%	1.4	%	1.4	%
Alaska Airlines	1.1	%	1.1	%	1.1	%	1.1	%	1.1	%	1.1	%
Copa Airlines	0.4	%	0.3	%	0.3	%	0.3	%	0.3	%	0.3	%
Charters	1.2	%	1.5	%	1.3	%	1.5	%	1.3	%	1.3	%
Other	0.4	%	0.5	%	0.4	%	0.5	%	0.4	%	0.4	%
Total international	14.9	%	15.0	%	12.9	%	15.0	%	12.9	%	12.9	%
Total	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%

Complementary Services Customers

As of December 31, ~~2018,~~2019, our principal complementary services clients are three principal providers of ramp‑handling and baggage‑handling services, AGN Aviation Services, S.A. de C.V., Menzies Aviation Mexico, S.A. de C.V. and Administradora Especializada en Negocios, S.A. de C.V., and our primary catering client is ~~Aerococina,~~Aero Cocina, S.A. de C.V., all of which provided an aggregate of ~~Ps.25,524~~Ps.28,627 thousand of revenues in the form of access fees in ~~2018.~~2019.

Principal Non-Aeronautical Services Customers

As of December 31, ~~2018,~~2019, we were party to approximately ~~1,235~~1,301 contracts with providers of commercial services in the commercial space in our airports, including retail store operators, duty free store operators, food and beverage providers, financial services providers, car rental companies, telecommunications providers, VIP lounges, advertising, travel agencies, time‑share sales and promotions services and tourist information and promotion services. As a result, our revenues from non‑aeronautical services commercial customers are spread across a large number of customers and are, therefore, not dependent on a limited number of principal customers. In ~~2018,~~2019, our largest commercial customers were ~~Aerocomidas, S.A.~~ISA Corporativo S. A. de ~~C.V. (food and beverage)~~C. V. (advertising), Alquiladora de Vehículos Automotores, S.A. de C.V. (car rental), Aerocomidas, S.A. de C.V. (food and beverage), DMC Transportación Ejecutiva, S. de R.L. de C. V. (VIP lounges), Operadora Aeroboutiques, S.A. de C.V. (duty paid stores), a subsidiary of Grupo Areas, Dufry México, S.A. de C.V. (duty free)~~, DMC Transportación Ejecutiva, S. de R.L. de C.V. (VIP lounges)~~ and ~~Especialistas en Alta Cocina,~~Comercial Ariete, S.A. de C.V. ~~(food and beverage)~~(car rental).

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Seasonality

Our business is subject to seasonal fluctuations. In general, demand for air travel is typically higher during the summer months and during the winter holiday season, particularly in international markets, because there is more vacation travel during these periods. Our results of operations generally reflect this seasonality but have also been impacted by numerous other factors that are not necessarily seasonal, including economic conditions, war or threat of war, weather, air traffic control delays and general economic conditions, as well as the other factors discussed above. As a result, our operating results for a quarterly period are not necessarily indicative of operating results for an entire year, and historical operating results are not necessarily indicative of future operating results.

Competition

Excluding our airports servicing tourist destinations, our airports currently are the only major airports in the geographic areas that they serve and generally do not face significant competition.

However, since the Acapulco, Mazatlán and Zihuatanejo airports are substantially dependent on tourists, these airports face competition from competing tourist destinations. We believe that the main competitors to these airports are those airports serving vacation destinations in Mexico, such as Los Cabos, Cancún and Puerto Vallarta, and abroad, such as in Florida, Puerto Rico, Cuba, Jamaica, the Dominican Republic, other Caribbean islands and Central America.

The relative attractiveness of the locations we serve is dependent on many factors, some of which are beyond our control. These factors include the general state of the Mexican economy, and to a significant degree, the U.S. economy and the attractiveness of other commercial and industrial centers in Mexico, which may affect the attractiveness of Monterrey and other growing population centers in our airport group, such as Ciudad Juárez and San Luis Potosí. In addition, with respect to Acapulco, Mazatlán and Zihuatanejo, these factors include promotional activities and pricing policies of hotel and resort operators, weather conditions, natural disasters (such as hurricanes and earthquakes) and the development of new resorts that may be considered more attractive. The locations we serve may not continue to attract the same level of passenger traffic in the future.

The Mexican Airport and Auxiliary Services ~~agency~~Agency currently operates 12 small airports in Mexico’s northern region, which collectively served ~~2,134,291~~2,434,329 passengers in ~~2018,~~2019, representing an increase of ~~13.9%~~14.1% from ~~2017~~2018 traffic, mainly as a result of an increase in passenger traffic ofto and from Querétaro, Tepic and Colima.

In the future, we may face competition from Aeropuerto del Norte, an airport near Monterrey operated by a third party pursuant to a concession. ~~Historically, Aeropuerto del Norte has been used solely for general aviation operations.~~ The state of Nuevo León has requested in the past that the Ministry of Communications and Transportation amend Aeropuerto del Norte’s concession to allow it to serve commercial aviation ~~operations. To~~operations, but to date the Ministry of Communications and Transportation has not amended Aeropuerto del Norte’s concession. ~~The Ministry of Communications and Transportation may authorize such an amendment, and commercial aviation flights may operate from Aeropuerto del Norte in the future.~~ In addition, we understand that Aeropuerto del Norte is not capable of accommodating commercial passenger traffic with its current infrastructure.

In addition, the Mexican government could grant new concessions to operate existing government‑managed airports or authorize the construction of new airports, which could compete directly with our airports. Any competition from other such airports could have a material adverse effect on our business and results of operations.

For more information, see "Risk Factors - Risks Related to the Regulation of Our Business - "The Mexican government could grant new concessions that compete with the airports operated by the Company".

Sustainability and Our Corporate Culture

Sustainability is one of the core values of our corporate culture. Our integrated management system focuses on quality, customer service, occupational health and safety, environmental care, corporate social responsibility and corporate governance. This allows us to respond in a balanced way to the relevant aspects of our stakeholders through different actions and projects in our 13 airports.

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Awards and Recognition

In 2018, OMA was ~~once again~~ included in the Dow Jones Sustainability Index (“DJSI”) Emerging Markets for the third consecutive year. ~~The current DJSI is valid for one year.~~ In addition, OMA was included in 2019 in the ~~newly launched~~ Dow Jones Sustainability Index-MILA, for the second consecutive year. The current DJSI-MILA is valid ~~for one year.~~through Spetember 2020.

~~We have been~~In, 2018, we were included in the Sustainability Index of the Mexican Stock Exchange (Índice Sustentable de la Bolsa Mexicana de Valores) for ~~eight years~~the seventh year in a row.

Ten of our 13 airports have maintained certifications as Safe Companies by the Mexican Ministry of Labor and Social Welfare (Secretaría del Trabajo y Previsión Social) for their achievements in the administration of health and safety in the workplace. The San Luis Potosí airport was the first airport in Mexico to receive such certification in 2011, and in 2015 it was granted the highest recognition by the Ministry of Labor and Social Welfare with a Level III Safe Company Certificate (Certificado de Empresa Segura Nivel III). The Ministry of Labor and Social Welfare granted Level I Safe Company Certificates (Certificado de Empresa Segura Nivel I) to the Reynosa airport, Level II Safe Company Certificates (Certificado de Empresa Segura Nivel II) to the Zacatecas airport, Level III to the Acapulco, Ciudad Juárez, Monterrey and Zihuatanejo airports, and the Revalidation of Level III Safe Company Certificates (Certificado de Empresa Segura Revalidación Nivel III) to the Culiacán, Mazatlán, San Luis Potosí and Torreón airports.

In 2013 and 2014, respectively, the Acapulco airport and the Ciudad Juárez airport received the Environmental Quality Certificate (Certificado de Calidad Ambiental) issued by the Federal Office for the Protection of the Environment (Procuraduría Federal de Protección al Ambiente) for compliance with applicable Mexican environmental laws, regulations and applicable Official Mexican Standards and must be renewed on a biannual basis. In 2014, this certificate was renewed for the Ciudad Juárez and Chihuahua airports, in 2015 the Acapulco, Culiacán, Mazatlán and Zihuatanejo airports received new Environmental Quality Certificates valid for two years, and in 2016 the certificate was renewed for the Chihuahua airport and a new certificate was granted for the Tampico airport. In 2017, the Mazatlán, Ciudad Juárez, Culiacán, Chihuahua, Tampico, Acapulco, Reynosa and Zihuatanejo airports kept current Environmental Quality Certificates. In ~~2018,~~2019, all our airports, excluding Monterrey, maintained the certification, and the Monterrey airport is expected to receive its certificate in ~~the near future.~~2020. In addition, in 2018 the Federal Office for the Protection of the ~~Environment(~~Environment (Procuraduría Federal de Protección al Ambiente) granted OMA the Environmental Commitment Recognition for the implementation of innovative business strategies to preserve and improve the environment while contributing to sustainable development.

In November 2018, for the ninth consecutive year, we received a “Great Place to Work” certificate granted by Great Place to Work Institute®, and were ranked first in the top 100 best companies to work for in the Northeastern Region of Mexico, according to the ranking published by this organization.

In February 2018, for the eleventh consecutive year, we received the Socially Responsible Business Distinction (Distintivo de Empresa Socialmente Responsable) granted by the Mexican Center for Philanthropy (Centro Mexicano para la Filantropía).

In 2017, the Zacatecas airport received a Family Responsibility Company Certificate (Certificado de Empresa Familiarmente Responsable) granted by the Mexican Ministry of Labor and Social Welfare. This certificate was also granted to the Chihuahua and Tampico airports in 2018, to the Culiacán, Durango and Reynosa airports in 2016 and to the Ciudad Juárez, Monterrey, Mazatlán and Torreón airports in 2017. In 2019, the Culiacán, Mazatlán and Reynosa airports received the renewal of the certificate.

In 2014 and 2016, the Zacatecas and the Culiacán airports, respectively, received the Inclusive Company Award (Distintivo Empresa Incluyente) granted by the Ministry of Labor and Social Welfare to companies with good labor practices that promote the inclusion and no discrimination of persons with a disability. This award was granted to the Culiacán airport again in 2017.

In 2018, the Culiacán, Mazatlán, Reynosa, Tampico, Torreón, Zacatecas and Zihuatanejo airports received the Distinctive “S” (Distintivo “S”) granted by the Ministry of Tourism to companies with good practices in the

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development of tourism projects and its commitment to global sustainability criteria.

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In 2019, the Acapulco, Ciudad Juárez, Chihuahua, Durango and San Luis Potosí airports also received such Distinctive “S” (Distintivo “S”).

On February 16, 2015, the Culiacán airport was named the Best Regional Airport of 2014 in Latin America and the Caribbean by Airports Council International (“ACI”), and on February 29, 2016 it received this recognition for the second consecutive year.

On March 6, 2018, the Mazatlán airport was named the Best Regional Airport of 2017 in Latin America and the Caribbean by ACI. Previous recognition was awarded in 2014.

REGULATORY FRAMEWORK

Sources of Regulation

The following are the principal laws, regulations and instruments that govern our business and the operation of our airports:

the Mexican General Law of Commercial Corporations (Ley General de Sociedades Mercantiles), enacted August 4, 1934;

the Mexican Airport Law, enacted December 22, 1995;

the regulations under the Mexican Airport Law (Reglamento del la Ley de Aeropuertos), enacted February 17, 2000;

the Mexican Communications Law (Ley de Vías Generales de Comunicación), enacted February 19, 1940;

the Mexican Civil Aviation Law (Ley de Aviación Civil), enacted May 12, 1995;

the regulations under the Mexican Civil Aviation Law (Reglamento de la Ley de Aviación Civil), enacted December 7, 1998;

the Mexican Federal Duties Law (Ley Federal de Derechos), enacted December 31, 1981, which may be revised on an annual basis and stipulates the applicable basis and rate for calculating the concession fee and duties payable under the current budget;

the Mexican National Assets Law (Ley General de Bienes Nacionales), enacted May 20, 2004;

the concessions that entitle our subsidiaries to operate our 13 airports for a term of 50 years beginning on November 1, 1998;

the Mexican Securities Market Law (Ley del Mercado de Valores), enacted December 20, 2005;

the General Provisions Applicable to Issuers of Securities and other Participants in the Securities Market (Disposiciones de Carácter General Aplicables a las Emisoras de Valores y a otros Mercados Participantes del Mercado de Valores), enacted March 19, 2003;

the Mexican Federal Antitrust Law (Ley Federal de Competencia Económica), enacted May 23, 2014; and

the regulations under the Mexican Federal Antitrust Law (Reglamento de la Ley Federal de Competencia Económica), enacted October 12, 2007.

The Mexican Airport Law and the regulations under the Mexican Airport Law establish the general framework regulating the construction, operation, maintenance and development of Mexican airport facilities. The Mexican Airport

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Law’s stated intent is to promote the expansion, development and modernization of Mexico’s airport infrastructure by encouraging investment and competition.

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Under the Mexican Airport Law, the holder of a concession granted by the Ministry of Communications and Transportation is required to construct, operate, maintain and develop a public service airport in Mexico. A concession generally must be granted pursuant to a public bidding process, except for: (i) concessions granted to either (a) entities considered part of “the federal public administration” as defined under Mexican law or (b) private companies whose principal shareholders may be a state or municipal government; (ii) concessions granted to operators of private airports (who have operated privately for five or more years) wishing to begin operating their facilities as public service airports; and (iii) complementary concessions granted to existing concession holders. Complementary concessions may be granted only under certain limited circumstances, such as where an existing concession holder can demonstrate, among other things, that the award of the complementary concession is necessary to satisfy passenger demand.

On June 29, 1998, the Ministry of Communications and Transportation granted 13 concessions to operate, maintain and develop the 13 principal airports in Mexico’s Central North region to our subsidiaries. Because our subsidiaries were considered entities of the federal public administration at the time the concessions were granted, the concessions were awarded without a public bidding process. However, the process of selling Series BB shares (currently representing ~~12.6%~~12.8% of our capital stock) to our strategic shareholder pursuant to the privatization process was conducted through a public bidding process. Each of our concessions was amended on September 12, 2000, in order, among other things, to incorporate each airport’s maximum rates and certain other terms as part of the concession.

Reforms to the Mexican Airport Law and Civil Aviation Law

On January 26, 2015, amendments to the Mexican Airport Law and Civil Aviation Law were published and enacted. Among other matters, the amendments include provisions that intend to create a competitive market for the suppliers of complementary services. To this end, the amendments establish that a concession holder may not limit the number of providers of complementary services in its airport, except in instances in which space availability, operational efficiency and/or safety warrant such a limitation. If a concession holder denies entry to any complementary service provider for a reason other than the above, that service provider may file a complaint before the Ministry of Communications and Transportation.

On June 8, 2016, Article 10 BIS was added to the Mexican Airport Law to provide guidance regarding the granting of concession titles and extensions. Article 10 BIS requires the Ministry of Communications and Transportation to file with the Ministry of Finance and Public Credit, in accordance with the Mexican Airport Law and corresponding regulations, the following: (i) a favorable opinion on the economic profitability of the respective project; (ii) if federal public funds are used to finance part of the project, evidence of the registration of the project with the investment program and project registry maintained by the Ministry of Finance and Public Credit; and (iii) the determination of the fee and duties payable by the concessionaire to the Mexican government, in terms of the applicable law.

We believe we are currently complying in all material respects with the requirements of the Mexican Airport Law and its regulations. Noncompliance with these regulations could result in fines or other sanctions being assessed by the Ministry of Communications and Transportation, and are among the violations that could result in termination of a concession if they occur three or more times.

On November 8, 2017, an amendment to the Mexican Airport Law took effect, which modified various regulations, primarily impacting airlines. As a result of the amendment, airlines must, among others: (i) be transparent when providing information regarding taxes and restrictions on a passenger’s airplane ticket and the breakdown of each cargo fee; (ii) provide passengers at least a 24-hour advance notice of any change in itinerary; (iii) compensate passengers in the event of a cancellation, overbooking and/or the damage, loss or destruction of luggage; and (iv) allow passengers with disabilities to transport necessary implements (such as wheelchairs, walkers, prostheses, crutches, walking sticks or any other implement), at no extra charge, provided that it is for personal use and the item is directly related to the traveler’s disability.

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Federal Antitrust Commission

On May 23, 2014, a new Federal Antitrust Law (Ley Federal de Competencia Económica) was enacted. The law grants broader powers to the Mexican Antitrust Commission, including the abilities to regulate essential facilities, order the divestment of assets and eliminate barriers to competition in order to promote access to the market. The law also sets forth important changes in connection with mergers and anti‑competitive behavior, increases liabilities that may be incurred for violations of the law, increases the amount of fines that may be imposed for violations of the law and limits the availability of legal defenses against the application of the law. If the Mexican Antitrust Commission determines that a specific service or product is an essential facility, it has the ability to regulate access conditions, prices, tariffs or technical conditions for or in connection with the relevant service or product. As of April ~~19, 2019,~~22, 2020, the Mexican Antitrust Commission had not made any determination as to whether the services we render are considered an essential facility.

Role of the Ministry of Communications and Transportation

The Ministry of Communications and Transportation is the principal regulator of airports in Mexico and is authorized by the Mexican Airport Law to perform the following functions:

plan, formulate and establish the policies and programs for the development of the national airport system;

construct, administer and operate airports and airport‑related services for the public interest;

grant, modify and revoke concessions for the operation of airports;

establish air transit rules and rules regulating take‑off and landing schedules through the Mexican air traffic control authority;

take all necessary action to create an efficient, competitive and non‑discriminatory market for airport‑related services and set forth the minimum operating conditions for airports;

establish safety regulations;

close airports entirely or partially when safety requirements are not being satisfied;

monitor airport facilities to determine their compliance with the Mexican Airport Law, other applicable laws and the terms of the concessions;

maintain the Mexican aeronautical registry for registrations relating to airports;

impose penalties for failure to observe and perform the rules under the Mexican Airport Law, the regulations thereunder and the concessions;

approve any transaction or transactions that directly or indirectly may result in a change of control of a concession holder;

approve the master development programs prepared by each concession holder every five years;

determine each airport’s maximum rates;

approve any agreements entered into between a concession holder and a third party providing airport or complementary services at its airport; and

perform any other function specified by the Mexican Airport Law.

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In addition, under the Mexican Organic Law of the Federal Public Administration (Ley Orgánica de la Administración Pública Federal), the Mexican Airport Law and the Mexican Civil Aviation Law, the Ministry of Communications and Transportation is required to provide air traffic control, radio assistance and aeronautical communications at Mexico’s airports. The Ministry of Communications and Transportation provides these services through Services for Navigation in Mexican Air Space, the Mexican air traffic control authority, which is a division of the Ministry of Communications and Transportation. Since 1978, the Mexican air traffic control authority has provided air traffic control for Mexico’s airports.

On October 16, 2019, the Ministry of Communications and Transportation established AFAC, an independent regulatory agency, that replaced the Mexican Bureau of Civil Aviation (Dirección General de Aeronáutica Civil). AFAC is responsible for establishing, coordinating, overseeing and controlling international and national air transportation, as well as the airports, complementary services and generally all activities related to civil aviation. Even though AFAC has been formally established, its internal regulations and operation manuals are still pending as of the date of this report. As such, the Company cannot predict how this new agency will be organized, the scope of its authority, the actions that it will take in the future or the effect of any such actions on its business.

Concession Tax

Under Article 232‑A of the Mexican Federal Duties Law, holders of airport concessions must pay a tax for the use of state‑owned assets. As such, each of our subsidiary concession holders is required to pay the Mexican government a concession tax based on its gross annual revenues (excluding revenues from improvements to concession assets) from the use of public domain assets pursuant to the terms of its concession. Currently, this concession tax is set at a rate of 5% and may be revised at any time by the Mexican government. Our concessions provide that we may request an amendment of our maximum rates if there is a change in this concession tax, although such a request may not be honored in the future.

Scope of Concessions

We hold (through subsidiary holding companies) concessions granted to us by the Mexican government to use, operate, maintain and develop 13 airports in the Central North region of Mexico in accordance with the Mexican Airport Law. As authorized under the Mexican Airport Law, each of the concessions is held by one of our subsidiaries for an initial 50‑year term beginning on November 1, 1998. This initial term of each of our concessions may be renewed in one or more terms for up to an additional 50 years, subject to our acceptance of any new conditions imposed by the Ministry of Communications and Transportation and to our compliance with the terms of our concession.

The concessions held by our subsidiary concession holders allow the relevant concession holder, during the term of the concession, to: (i) operate, maintain and develop its airport and carry out any necessary construction in order to render airport, complementary and commercial services as provided under the Mexican Airport Law and its ~~regulations;~~regulations and (ii) use and develop the assets that comprise the airport that is the subject of the concession (consisting of the airport’s real estate and improvements but excluding assets used in connection with fuel supply and storage). These assets are government‑owned assets, subject to the Mexican National Assets Law. Upon expiration of a concession, the use of these assets, together with any improvements thereto, automatically revert to the Mexican government.

Concession holders are required to provide airport security, which must include contingent and emergency plans in accordance with the regulations under the Mexican Airport Law. The security regulations shall be implemented in accordance with the requirements set forth in the National Program for Airport Security (Plan Nacional de Seguridad Aeroportuaria). In addition, the regulations pertaining to the Mexican Airport Law specify that an airport concession holder is responsible for the inspection of passengers and carry‑on luggage prior to approaching the departure gates and specify that the transporting airline is responsible for the inspection of checked‑in luggage and cargo. If public order or national security is endangered, the competent federal authorities are authorized to act to protect the safety of aircraft, passengers, cargo, mail, installations and equipment.

The shares of a concession holder and the rights under a concession may be subject to a lien only with the approval of the Ministry of Communications and Transportation. No agreement documenting liens approved by the

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Ministry of Communications and Transportation may allow the beneficiary of a pledge to become a concession holder under any circumstances.

A concession holder may not assign any of its rights or obligations under its concession without the authorization of the Ministry of Communications and Transportation. The Ministry of Communications and Transportation is authorized to consent to an assignment only if the proposed assignee satisfies the requirements to be a concession holder under the Mexican Airport Law, undertakes to comply with the obligations under the relevant concession and agrees to any other conditions that the Ministry of Communications and Transportation may require.

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General Obligations of Concession Holders

The concessions impose certain obligations on the concession holders, including, among others, (i) the obligation to pay the concession tax described above, (ii) the obligation to deliver concession services in a continuous, public and non‑discriminatory manner, (iii) the obligation to maintain the airports in good working condition and (iv) the obligation to make investments with respect to the infrastructure and equipment in accordance with the master development programs and the concessions.

Each concession holder and any third party providing services at an airport is required to carry specified insurance in amounts and covering specified risks, such as damage to persons and property at the airport, in each case as specified by the Ministry of Communications and Transportation. ~~To date,~~As of April 22, 2020, the Ministry of Communications and Transportation has not specified the required amounts of insurance. We may be required to obtain additional insurance once these amounts are specified. We, together with our subsidiary concession holders, are jointly and severally liable to the Ministry of Communications and Transportation for the performance of all obligations under the concessions held by our subsidiaries. Each of our subsidiary concession holders is responsible for the performance of the obligations set forth in its concession and in the master development programs, including the obligations arising from third‑party contracts, as well as for any damages to the Mexican government‑owned assets that they use and to third‑party airport users. In the event of a breach of one concession, the Ministry of Communications and Transportation is entitled to revoke all of the concessions held by our subsidiaries.

Substantially all of the contracts entered into prior to the grant of our concessions by the Mexican Airport and Auxiliary Services ~~agency~~Agency with respect to each of our airports were assigned to the relevant concession holder for each airport. As part of this assignment, each concession holder agreed to indemnify the Mexican Airport and Auxiliary Services ~~agency~~Agency for any loss suffered by the Mexican Airport and Auxiliary Services ~~agency~~Agency due to the concession holder’s breach of its obligations under an assigned agreement.

Classification of Services Provided at Airports

The Mexican Airport Law and its regulations classify the services that may be rendered at an airport into the following three categories:

Airport Services. Airport services may be rendered only by the holder of a concession or a third party that has entered into an agreement with the concession holder to provide such services. These services include the following:

the use of airport runways, taxiways and aprons for landing, aircraft parking and departure;

the use of hangars, passenger walkways, transport buses and car parking facilities;

the provision of airport security services, rescue and firefighting services, ground traffic control, lighting and visual aids;

the general use of terminal space and other infrastructure by aircraft, passengers and cargo; and

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the provision of access to an airport to third parties providing complementary services (as defined in the Mexican Airport Law) and third parties providing permanent ground transportation services (such as taxis).

Complementary Services. Complementary services for which the airlines are responsible may be rendered by an airline, by the airport operator or by a third party under agreements with airlines and the airport operator. These services include: ramp and handling services, checked‑baggage screening, aircraft security, catering, cleaning, maintenance, repair and fuel supply (currently provided exclusively by the Mexican Airport and Auxiliary Services ~~agency)~~Agency) and related activities that provide support to air carriers.

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Commercial Services. Commercial services involve services that are not considered essential to the operation of an airport or aircraft. These services include, among other things, the leasing of space to retailers, restaurants and banks and advertising; hotel services; air cargo logistics; and real estate services.

Third parties rendering airport, complementary or commercial services are required to do so pursuant to a written agreement with the relevant concession holder. We have entered into agreements with third parties for security and surveillance services, ramp‑handling and baggage‑handling services and checked‑baggage services, among others. All agreements relating to airport or complementary services are required to be approved by the Ministry of Communications and Transportation. The Mexican Airport Law provides that the concession holder is jointly liable with these third parties for compliance with the terms of the relevant concession with respect to the services provided by such third parties. All third‑party service providers of complementary services are required to be corporations incorporated under Mexican law. In addition, we lease spaces to ~~third parties~~third-party tenants that provide commercial services such as food and beverage, retail and advertising.

A concession holder is also required to allow for a competitive market for complementary services. A concession holder may only limit the number of providers of complementary services in its airport due to space, efficiency and/or safety considerations. If a concession holder denies entry to any complementary services provider for reasons other than the above, such service provider may file a complaint with the Ministry of Communications and Transportation, which shall determine within 60 days of the filing of the complaint whether entry of the service provider into the airport shall be authorized. If the number of complementary service providers must be limited due to these considerations, contracts for the provision of complementary services must be awarded through a competitive bidding process.

Airport and complementary services are required to be provided to all users in a uniform and regular manner, without discrimination as to quality, access or price. Concession holders are required to provide airport and complementary services on a priority basis to military aircraft, disaster‑support aircraft and aircraft experiencing emergencies. Airport and complementary services are required to be provided at no cost to military aircraft and aircraft performing national security activities.

In the event of force majeure, the Ministry of Communications and Transportation may impose additional regulations governing the provision of services at airports, but only to the extent necessary to address the force majeure event. The Mexican Airport Law allows the airport administrator appointed by a concession holder to suspend the provision of airport services in the event of force majeure.

Master Development Programs

Concession holders are also required to submit to the Ministry of Communications and Transportation a master development program describing, among other things, the concession holder’s construction and maintenance plans.

Each master development program is for a period of 15 years and is required to be updated every five years and resubmitted for approval to the Ministry of Communications and Transportation. Upon such approval, the master development program is deemed to constitute a part of the relevant concession. Information required to be presented in the master development program includes:

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airport growth and development expectations;

15‑year projections for air traffic demand (including passenger, cargo and operations);

construction, conservation, maintenance, expansion and modernization programs for infrastructure, facilities and equipment;

a binding five‑year detailed investment program and planned major investments for the following 10 years;

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descriptive airport plans specifying the distinct uses for the corresponding airport areas;

any financing sources; and

environmental protection measures.

The concessions require the concession holder to prepare and submit the concession holder’s master development program in a 24‑month period and consider the necessary requirements of the airport users in the preparation of the master development program as well as the opinions of air carriers and operations and timetable’s committee. The concession holder must submit a draft of the master development program to an operations committee (Comité de Operación y Horarios), composed of each of the airport’s principal users, for their review and comments six months prior to its submission for approval to the Ministry of Communications and Transportation. Further, the concession holder must submit, six months prior to the expiration of the five‑year term, the new master development program to the Ministry of Communications and Transportation. The Ministry of Communications and Transportation may request additional information or clarification as well as seek further comments from airport users. The Mexican Ministry of Defense (Secretaría de la Defensa Nacional) may also opine on the master development programs.

A concession holder may only undertake a major construction project, renovation or expansion relating to an airport pursuant to its master development program or with the approval of the Ministry of Communications and Transportation. We are required to spend the full amounts set forth in each investment program under our master development programs, and the Ministry of Communications and Transportation may apply sanctions if we do not comply.

Changes to a master development program and investment program require the approval of the Ministry of Communications and Transportation, except for emergency repairs and minor works that do not adversely affect an airport’s operations.

Pursuant to the terms of our concessions, we are required to comply with the investment obligations under the master development programs on a year‑by‑year basis, and the Ministry of Communications and Transportation is entitled to review our compliance thereunder (and apply sanctions accordingly) on a year‑by‑year basis. Although historically the Ministry of Communications and Transportation has indicated its intent to review our compliance with these obligations on an aggregate five‑year basis, we understand that the Ministry of Communications and Transportation may also conduct more limited reviews of our compliance with our obligations on a year‑by‑year basis going forward.

During 2015, we negotiated the master development program for the 2016 to 2020 period with the Ministry of Communications and Transportation for each of our subsidiary concession holders. This five‑year program is in effect from January 1, 2016 until December 31, 2020.

In July 2020, we will start negotiations with the Ministry of Communications and Transportation on the master development program for the 2021-2025 period, for each of our subsidiary concession holders, which will be effective from January 1, 2021 through December 31, 2025. We do not expect the COVID-19 pandemic to affect our committed investments under the current master development programs nor the timing of the negotiations of the master development program for the 2021-2025 period.

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Revenue Regulation

The Mexican Airport Law provides for the Ministry of Communications and Transportation to establish price regulations for services for which the Antitrust Commission determines that a competitive market does not exist. In 1999, the Antitrust Commission issued a ruling stating that competitive markets generally do not exist for airport services and airport access provided to third parties rendering complementary services. This ruling authorized the Ministry of Communications and Transportation to establish regulations governing the prices that may be charged for airport services and access fees that may be charged to third parties rendering complementary services in our airports. On September 12, 2000, the Rate Regulation (Regulación Tarifaria), which provides a framework for the setting by the Ministry of Communications and Transportation of five‑year maximum rates, was incorporated within the terms of each of our concessions. See “Item 3. Key Information—Risk Factors—Risks Related to the Regulation of Our Business— The Company cannot predict how the regulations governing the business will be applied.”

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Regulated Revenues

Since January 1, 2000, all of our revenues from aeronautical services have been subject to the Rate Regulation. This price regulation system establishes a “maximum rate” for each airport for every year in a five‑year period. The “maximum rate” is the maximum amount of revenues per “workload unit” that may be earned at an airport each year from regulated revenue sources. Under this regulation, a workload unit is equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo, including those transported in passenger airplanes. The combined maximum tariffs are expressed in workload units for each airport and were determined based on: (i) projected workload units; (ii) capital investments; and (iii) the operating expenses authorized for the five-year period in the master development programs.

We are able to set the specific prices for regulated services, other than complementary services and the leasing of space to airlines, for each of our airports every six months (or earlier upon a cumulative increase of 5% in the Mexican ~~producer price index~~Producer Price Index (excluding fuel)), as long as the combined revenues from regulated services at an airport does not exceed the maximum rate per workload unit at that airport on an annual basis. Since our aggregate revenues resulting from regulated services are not otherwise restricted, increases in passenger and cargo traffic increase the workload units permit greater revenues overall within each five‑year period for which maximum rates are established.

The Rate Regulation establishes a “dual-till” system of price regulation under which a majority of our revenues, such as passenger fees, landing fees, aircraft parking fees and access fees from third parties providing complementary services at our airports, are regulated, while the revenues that we earn from commercial activities in terminals at our airports, such as the leasing of space to retailers, restaurants, car rental companies and banks, are not regulated. In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, approximately ~~69.8%~~61.0%, ~~61.0%~~65.0% and ~~65.0%~~67.5%, respectively, of our total revenues were earned from aeronautical services subject to price regulation under our maximum rates ~~(74.4%~~(74.9%, ~~74.9%~~76.0% and ~~76.0%,~~76.0 %, respectively, of the sum of aeronautical and non-aeronautical ~~revenues.~~revenues).

Our revenues from non‑aeronautical services, including revenues that we earn from most commercial activities in our terminals, are not subject to this maximum‑rate price regulation system and are therefore not subject to a ceiling. For a description of how we classify our revenues into aeronautical and non-aeronautical services, see “Item 5. Operating and Financial Review and Prospects—Overview—Classification of Revenues.”

Maximum Rates

Each airport’s maximum rate is to be determined for each year by the Ministry of Communications and Transportation based on a general framework established in our concessions. This framework reflects, among other factors, projections of an airport’s revenues, operating costs and capital expenditures, as well as the estimated cost of capital related to regulated services and projected annual efficiency adjustments determined by the Ministry of Communications and Transportation. The schedule of maximum rates for each airport is to be established every five years.

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Maximum Rates for 2016 through 2020

On December 30, 2015, the Ministry of Communications and Transportation set the airport maximum rates for the five‑year period from January 1, 2016 through December 31, 2020. These maximum rates are subject to adjustment only under the limited circumstances described below under “Special Adjustments to Maximum Rates.” The following table sets forth the maximum rates for each of our airports under our 2016 to 2020 master development programs that went into effect as of January 1, 2016:

Current Maximum Rates(1)


	For the Year Ended December 31,					For the Year Ended December 31,
	2016	2017	2018	2019	2020	2016	2017	2018	2019	2020
Acapulco	311.94	309.76	307.58	305.43	303.30	314.06	311.86	309.67	307.50	305.35
Ciudad Juárez	236.21	234.55	232.91	231.28	229.66	237.81	236.14	234.48	232.84	231.21
Culiacán	251.52	249.76	248.01	246.28	244.55	253.22	251.45	249.69	247.94	246.21
Chihuahua	237.89	236.22	234.56	232.92	231.29	239.50	237.82	236.15	234.50	232.86
Durango	288.82	286.80	284.79	282.80	280.82	290.77	288.74	286.72	284.71	282.72
Mazatlán	277.45	275.51	273.58	271.67	269.77	279.33	277.38	275.44	273.51	271.59
Monterrey	230.51	228.89	227.29	225.70	224.12	232.07	230.45	228.83	227.23	225.64
Reynosa	269.59	267.70	265.82	263.96	262.10	271.41	269.51	267.62	265.74	263.88
San Luis Potosí	201.19	199.78	198.38	196.99	195.61	202.55	201.13	199.72	198.33	196.93
Tampico	270.85	268.96	267.09	265.22	263.37	272.69	270.79	268.90	267.02	265.16
Torreón	285.78	283.77	281.79	279.82	277.87	287.71	285.69	283.70	281.72	279.75
Zacatecas	302.34	300.22	298.12	296.04	293.97	304.39	302.25	300.14	298.04	295.96
Zihuatanejo	311.80	309.62	307.45	305.31	303.17	313.91	311.71	309.54	307.37	305.22

(1)

Expressed in constant pesos as of December 31, ~~2018,~~2019, as required by the maximum rate regulation. The maximum rate for each succeeding year from ~~2018~~2016 onwards is reduced by the efficiency factor of 0.70% per year.

We will submit the new master development program to the Ministry of Communications and Transportation in 2020, which upon approval would be in effect from January 1, 2021 to December 31, 2025.

Methodology for Determining Future Maximum Rates

The Rate Regulation provides that each airport’s annual maximum rates are to be determined in five‑year intervals based on the following variables:

Projections for the following 15 years of workload units (each of which is equivalent to one terminal passenger or 100 kilograms (220 pounds) of commercial cargo), operating costs and expenses related to services subject to price regulation and pre‑tax earnings from services subject to price regulation. The concessions provide that projections for workload units and expenses related to regulated services are to be derived from the terms of the relevant concession holder’s master development program for the following 15 years.

Projections for the following 15 years of capital expenditures related to regulated services, based on air traffic forecasts and quality of standards for services to be derived from the master development programs.

Reference values, which initially were established in the concessions and are designed to reflect the net present value of the regulated revenues minus the corresponding regulated operating costs and expenses (excluding amortization and depreciation), and capital expenditures related to the provision of regulated services plus a terminal value.

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A discount rate to be determined by the Ministry of Communications and Transportation. The concessions provide that the discount rate shall reflect the cost of capital to Mexican and international companies in the airport industry (on a pre‑tax basis), as well as Mexican economic conditions. The concessions provide that the discount rate shall be at least equal to the average yield of long term Mexican government debt securities quoted in the international markets during the prior 24 months plus a risk premium to be determined by the Ministry of Communications and Transportation based on the inherent risk of the airport business in Mexico.

An efficiency factor to be determined by the Ministry of Communications and Transportation. For the five‑year period ending December 31, 2020, the maximum rates applicable to our airports reflect a projected annual efficiency improvement of 0.70%.

Our concessions specify a discounted cash flow formula to be used by the Ministry of Communications and Transportation to determine the maximum rates that, given the projected pre‑tax earnings, the efficiency adjustment, capital expenditures and discount rate, would result in a net present value equal to the reference values established in connection with the last determination of maximum rates. In connection with the preparation of the current master development programs, we prepared a proposal to submit to the Ministry of Communications and Transportation establishing the values we believe should be used with respect to each variable included in the determination of maximum rates, including the efficiency factor, projected capital expenditures and the discount rate. Historically, the maximum rates ultimately established by the Ministry of Communications and Transportation reflect a negotiation between the Ministry and us regarding these variables. Once the maximum rates are established, they may be adjusted annually to take account of projected improvements in efficiency and the Mexican ~~producer price index~~Producer Price Index (excluding fuel).

The concessions provide that each airport’s reference values, discount rate and the other variables used in calculating the maximum rates do not represent an undertaking by the Ministry of Communications and Transportation or the Mexican government as to the profitability of any concession holder. Therefore, whether or not the maximum rates (or the amounts up to the maximum rates that we have been able to collect) multiplied by workload units at any airport generate a profit or exceed our profit estimates, or reflect the actual profitability, discount rates, capital expenditures or productivity gains at that airport over the five‑year period, we are not entitled to any adjustment to compensate for this shortfall.

To the extent that such aggregate revenues per workload unit exceed the relevant maximum rate, the Ministry of Communications and Transportation may proportionately reduce the maximum rate in the immediately subsequent year and assess penalties equivalent to 1,000 to 50,000 times the ~~general minimum wage in the Federal District (Mexico City)~~Unit of Measurement and Update (“UMA”). The ~~daily minimum general wage in Mexico City~~UMA as of January 1, ~~2019~~2020 was ~~Ps.102.68.~~Ps.86.88. As a result, the maximum penalty at such date could have been ~~Ps.5,134~~Ps.4,344 thousand (U.S.$~~261,185)~~230,174) per airport.

As established by the Ministry of Communications and Transportation, the calculation of workload units does not include transit passengers for subsequent years. The current workload unit calculation is therefore equal to one terminal passenger or 100 kilograms (220 pounds) of commercial cargo.

Special Adjustments to Maximum Rates

Once determined, each airport’s maximum rates are subject to special adjustment only under the following circumstances:

Change in law or natural disasters. A concession holder may request an adjustment in its maximum rates if a change in law with respect to quality standards or safety and environmental protection results in operating costs or capital expenditures that were not contemplated when its maximum rates were determined. In addition, a concession holder may also request an adjustment in its maximum rates if a natural disaster affects demand or requires unanticipated capital expenditures. Requests on these grounds may not be approved in the future.

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Macroeconomic conditions. A concession holder may also request an adjustment in its maximum rates if, as a result of a decrease of at least 5% in Mexican GDP in a 12‑month period, the workload units processed in the concession holder’s airport are less than that projected when its master development program was approved. To grant an adjustment under these circumstances, the Ministry of Communications and Transportation under the master development program must have already allowed the concession holder to decrease its projected capital improvements as a result of the decline in passenger traffic volume. Requests on these grounds may not be approved in the future.

Increase in concession tax under Mexican Federal Duties Law. An increase in duty payable by a concession holder under the Mexican Federal Duties Law entitles the concession holder to request an adjustment in its maximum rates. Requests on these grounds may not be approved in the future.

Failure to make required investments or improvements. The Ministry of Communications and Transportation is required to review annually each concession holder’s compliance with its master development program (including the provision of services and the making of capital investments). If a concession holder fails to satisfy any of the investment commitments contained in its master development program, the Ministry of Communications and Transportation is entitled to decrease the concession holder’s maximum rates and assess penalties.

Excess revenues. In the event that revenues subject to price regulation per workload unit in any year exceed the applicable maximum rate, the maximum rate for the following year will be decreased to compensate airport users for overpayment in the previous year. Under these circumstances, the Ministry of Communications and Transportation is also entitled to assess penalties against the concession holder.

Increases in Maximum Rates Associated with Baggage-Screening Services

On November 23, 2012, the Mexican Bureau of Civil ~~aviation~~Aviation (currently AFAC) published mandatory circulars CO SA-17.2/10 R1, superseded by circulars CO SA-17.2/10 R3 and CO SA-17.9/16, which required that all airlines screen checked baggage and that all airports have screening equipment that complies with specified guidelines to provide the service to the airlines. On November 30, 2012, after negotiation with the Mexican Bureau of Civil Aviation (currently AFAC), the maximum rates of our thirteen airports were increased to take into account the maintenance cost incurred due to the operation of baggage‑screening equipment. The maximum rate increase became effective on January 1, 2013.

Ownership Commitments and Restrictions

The concessions require us to retain a 51% direct ownership interest in each of our 13 concession holders throughout the term of these concessions. Any acquisition by us or one of our concession holders of any additional airport concessions or of a beneficial interest of 30% or more of another concession holder requires the consent of the Antitrust Commission. In addition, the concessions prohibit us and our concession holders, collectively or individually, from acquiring more than one concession for the operation of an airport along each of Mexico’s southern and northern borders.

Air carriers are prohibited under the Mexican Airport Law from controlling or beneficially owning 5% or more of the shares of a holder of an airport concession. We, and each of our subsidiaries, are similarly restricted from owning 5% or more of the shares of any air carrier.

Foreign governments acting in a sovereign capacity are prohibited from owning any direct or indirect equity interest in a holder of an airport concession.

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Reporting, Information and Consent Requirements

Concession holders and third parties providing services at airports are required to provide the Ministry of Communications and Transportation access to all airport facilities and information relating to an airport’s construction, operation, maintenance and development. Each concession holder is obligated to maintain statistical records of operations and air traffic movements in its airport and to provide the Ministry of Communications and Transportation with any information that it may request. Each concession holder is also required to publish its annual audited consolidated financial statements in a principal Mexican newspaper within the first four months of each year.

The Mexican Airport Law provides that any person or group directly or indirectly acquiring control of a concession holder is required to obtain the consent of the Ministry of Communications and Transportation to such control acquisition. For purposes of this requirement, control is deemed to be acquired in the following circumstances:

if a person acquires 35% or more of the shares of a concession holder;

if a person has the ability to control the outcome of meetings of the shareholders of a concession holder;

if a person has the ability to appoint a majority of the members of the board of directors of a concession holder; or

if a person by any other means acquires control of an airport.

Under the regulations to the Mexican Airport Law, any company acquiring control of a concession holder is deemed to be jointly and severally liable with the concession holder for the performance of the terms and conditions of the concession.

The Ministry of Communications and Transportation is required to be notified upon any change in a concession holder’s chief executive officer, board of directors or management. A concession holder is also required to notify the Ministry of Communications and Transportation at least 90 days prior to the adoption of any amendment to its bylaws concerning the dissolution, corporate purpose, merger, transformation or spinoff of the concession holder.

Penalties and Termination and Revocation of Concessions and Concession Assets

Termination of Concessions

Under the Mexican Airport Law and the terms of the concessions, a concession may be terminated upon any of the following events:

the expiration of its term;

the surrender by the concession holder;

the revocation of the concession by the Ministry of Communications and Transportation;

the reversion of the Mexican government‑owned assets that are the subject of the concession (principally real estate, improvements and other infrastructure);

the inability to achieve the purpose of the concession, except in the event of force majeure;

the dissolution, liquidation or bankruptcy of the concession holder; or

the failure by the concession holder to satisfy the shareholding obligations set forth in the concession.

Following a concession’s termination, the concession holder remains liable for the performance of its obligations during the term of the concession.

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On May 20, 2004, a new Mexican National Assets Law was adopted and published in the Federal Official Gazette that, among other things, establishes regulations relating to concessions on real property held in the public domain, including the airports that we operate. The Mexican National Assets Law establishes additional grounds for revocation of concessions for failure to pay certain applicable taxes.

Revocation of Concessions

A concession may be revoked by the Ministry of Communications and Transportation under certain conditions, including:

the failure by a concession holder to begin operating, maintaining and developing an airport pursuant to the terms established in the concession;

the failure by a concession holder to maintain insurance as required under the Mexican Airport Law;

the assignment, encumbrance, transfer or sale of a concession, any of the rights thereunder or the assets underlying the concession in violation of the Mexican Airport Law;

any alteration of the nature or condition of an airport’s facilities without the authorization of the Ministry of Communications and Transportation;

use, with a concession holder’s consent and without the approval of air traffic control authorities, of an airport by any aircraft that does not comply with the requirements of the Mexican Civil Aviation Law, that has not been authorized by the Mexican air traffic control authority or that is involved in the commission of a felony;

knowingly appointing a chief executive officer or board member of a concession holder that is not qualified to perform his functions under the law as a result of having violated criminal laws;

the failure by the concession holder to pay the Mexican government the concession tax;

the failure by the concession holder to beneficially own at least 51% of the capital stock of its subsidiary concession holders;

a violation of the safety regulations established in the Mexican Airport Law and other applicable laws;

a total or partial interruption of the operation of an airport or its airport or complementary services without justified cause;

the failure to maintain the airport’s facilities;

the provision of unauthorized services;

the failure to indemnify a third party for damages caused by the provision of services by the concession holder or a third‑party service provider;

charging prices higher than those registered with the Ministry of Communications and Transportation for regulated services or exceeding the applicable maximum rate;

any act or omission that impedes the ability of other service providers or authorities to carry out their functions within the airport; or

any other failure to comply with the Mexican Airport Law, its regulations and the terms of a concession.

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The Ministry of Communications and Transportation is entitled to revoke a concession without prior notice as a result of the first six events described above. In the case of other violations, a concession may be revoked as a result of a violation only if sanctions have been imposed at least three times with respect to the same violation.

Pursuant to the terms of our concessions, in the event the Ministry of Communications and Transportation revokes one of our concessions, it is entitled to revoke all of our other concessions.

According to the Mexican National Assets Law, Mexico’s national patrimony consists of private and government‑owned assets of Mexico. The surface area of our airports and improvements on such space are considered government‑owned assets. A concession concerning government‑owned assets may be “rescued,” or reverted to the Mexican government prior to the concession’s expiration, when considered necessary for the public interest. In exchange, the Mexican government is required to pay compensation as determined by expert appraisers. Following a declaration of “rescue,” or reversion, the assets that were subject to the concession are automatically returned to the Mexican government.

In the event of war, public disturbances or threats to national security, the Mexican government may assume the operations (through a process known as requisa) of any airport, airport and complementary services as well as any other airport assets. Such government action may exist only during the duration of the emergency. Except in the case of war, the Mexican government is required to compensate all affected parties for any damages or losses suffered as a result of such government action. If the Mexican government and a concession holder cannot agree as to the appropriate amount of damages or losses, the amount of damages shall be determined by experts jointly appointed by both parties, and the amount of losses shall be determined based on the average net income of the concession holder during the previous year. In the event of a requisa due to international war, the Mexican government would not be obligated to indemnify us.

The Mexican Airport Law provides that sanctions of up to 400,000 times the ~~minimum general daily wage in the Federal District (Mexico City)~~UMA may be assessed for failures to comply with the terms of a concession. The ~~daily minimum wage in Mexico City~~UMA as of January 1, ~~2019~~2020 was ~~Ps.102.68.~~Ps.86.88. As a result, the maximum penalty at such date could have been ~~Ps.41,072~~Ps.34,752 thousand (U.S.$~~2.1~~1.8 million) per airport.

Consequences of Termination or Revocation of a Concession

Upon termination, whether as a result of expiration or revocation, the real estate and fixtures that were the subject of the concession automatically revert to the Mexican government. In addition, upon termination, the Mexican government has a preemptive right to acquire all other assets used by the concession holder to provide services under the concession at prices determined by expert appraisers appointed by the Ministry of Communications and Transportation. Alternatively, the Mexican government may elect to lease these assets for up to five years at fair market rates as determined by expert appraisers appointed by the Mexican government and the concession holder. In the event of a discrepancy between appraisals, a third expert appraiser must be jointly appointed by the Mexican government and the concession holder. If the concession holder does not appoint an expert appraiser, or if such appraiser fails to determine a price, the determination of the appraiser appointed by the Mexican government will be conclusive. If the Mexican government chooses to lease the assets, it may thereafter purchase the assets at their fair market value, as determined by an expert appraiser appointed by the Mexican government.

The Mexican Communications Law, however, provides that upon expiration, termination or revocation of a concession, all assets necessary to operate the airports will revert to the Mexican government at no cost and free of any liens or other encumbrances. There is substantial doubt as to whether the provisions of our concessions would prevail over those of the Mexican Communications Law. Accordingly, upon expiration or termination of our concessions, the assets used by our subsidiary concession holders to provide services at our airports may revert to the Mexican government, free of charge, together with government‑owned assets and improvements permanently attached thereto.

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Grants of New Concessions

The Mexican government may grant new concessions to manage, operate, develop and construct airports. Such concessions may be granted through a public bidding process in which bidders must demonstrate their technical, legal, managerial and financial capabilities. In addition, the government may grant concessions without a public bidding process to the following entities:

parties who hold permits to operate civil aerodromes and intend to transform the aerodrome into an airport so long as (i) the proposed change is consistent with the national airport development programs and policies, (ii) the civil aerodrome has been in continuous operation for the previous five years and (iii) the permit holder complies with all requirements of the concession;

current concession holders when necessary to meet increased demand so long as (i) a new airport is necessary to increase existing capacity, (ii) the operation of both airports by a single concession holder is more efficient than other options, and (iii) the concession holder complies with all requirements of the concession;

current concession holders when it is in the public interest for their airport to be relocated;

entities in the federal public administration; and

commercial entities in which local or municipal governments have a majority equity interest if the entities’ corporate purpose is to manage, operate, develop and/or construct airports.

Additionally, under the Mexican Airport Law for the granting of a concession title or the resolution to extend the term thereof, the Ministry of Communications and Transportation shall file before the Ministry of Finance and Public Credit the following:

a favorable opinion regarding the economic profitability of the corresponding project,

the registry of the programs portfolio and investment projects, in terms of the Federal ~~Law on~~ Budget and ~~Treasury~~Fiscal Responsibility ~~(Ley~~Law (Ley Federal de Presupuesto y Responsabilidad ~~Hacendaria)~~Hacendaria), in case public funds are used to finance an airport project, and

the assessment of the considerations that the concession holder shall pay to the federal government in terms of applicable law. For purposes of this section, the Ministry of Communications and Transportation shall submit a proposal of said considerations to the Ministry of Finance and Public Credit.

Environmental Matters

Regulation

Our operations are subject to Mexican federal and state laws and regulations relating to the protection of the environment. The major federal environmental laws applicable to our operations are: (i) the General Law of Ecological Equilibrium and Environmental Protection (Ley General del Equilibrio Ecológico y la Protección al Ambiente) or the “General Environmental Law,” and its regulations, which are administered by the Ministry of the Environment and Natural Resources and enforced by the Ministry’s enforcement branch, the Federal Attorney for Environmental Protection; (ii) the General Law for the Prevention and Integral Management of Waste (Ley General para la Prevención y Gestión Integral de los Residuos), or the “Law on Waste”, which is also administered by the Ministry of the Environment and Natural Resources and enforced by the Federal Attorney for Environmental Protection; (iii) the National Waters Law (Ley de Aguas Nacionales) and its regulations, which are administered and enforced by the National Waters Commission, also a branch of the Ministry of the Environment and Natural Resources; (iv) the General Law of Climate Change; and (v) the Federal Law of Environmental Responsibility (Ley Federal de Responsabilidad Ambiental).

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Under the General Environmental Law, regulations have been enacted concerning air pollution, environmental impact, environmental audits, natural protected areas, ecological ordering, emissions records and transfer of pollutants. The General Environmental Law also regulates, among other things, vibrations, thermal energy, soil contamination and visual pollution, although the Mexican government has not yet issued enforceable regulation on the majority of these matters. The General Environmental Law also provides that companies that contaminate soils are responsible for their clean‑up. Further, according to the Law on Waste, which was published in October 2003, owners and/or possessors of real property with soil contamination are jointly and severally liable for the remediation of such contaminated sites, irrespective of any recourse or other actions such owners and/or possessors may have against the contaminating party, and aside from the criminal or administrative liability to which the contaminating party may be subject. Restrictions on the transfer of contaminated sites also exist. The Law on Waste also regulates the generation, handling and final disposal of hazardous waste.

Pursuant to the National Waters Law, companies that discharge wastewaters into national water bodies must comply with, among other rules, maximum permissible contaminant levels in order to preserve water quality. Periodic reports on water quality must be provided to competent authorities. Liability may result from the contamination of underground waters or recipient water bodies. The use of underground waters is subject to restrictions pursuant to our concessions and the National Waters Commission.

In addition to the foregoing, Official Mexican Standards (Normas Oficiales Mexicanas), which are technical standards issued by competent regulatory authorities pursuant to the General Meteorology and Normalization Law (Ley General de Metrología y Normalización) and to other laws that include the environmental laws described above, establish standards relating to air emissions, soil contamination, wastewater discharges, the generation, handling and disposal of hazardous waste and noise control, among other issues.

The Ministry of the Environment and Natural Resources (Secretaría de Medio Ambiente y Recursos Naturales) and the Federal Office for the Protection of the Environment (Procuraduría Federal de Protección al Ambiente) are the responsible regulators. The Federal Office for the Protection of the Environment can bring administrative, civil and criminal proceedings against companies that violate environmental laws, and it also has the power to close non‑complying facilities and impose a variety of sanctions. Companies in Mexico are required to obtain proper authorizations, licenses, concessions or permits from competent environmental authorities for the performance of activities that may have an impact on the environment or that may constitute a source of contamination. Companies in Mexico are also required to comply with a variety of reporting obligations that include, among others, providing the Ministry of the Environment and Natural Resources, the Federal Office for the Protection of the Environment and the National Waters Commission, as applicable, with periodic reports regarding compliance with various environmental laws.

Prior to the opening of Mexico’s airports to private investment, the Federal Office for the Protection of the Environment required that environmental audits be performed at each of our airports. Based on the results of these audits, the Federal Office for the Protection of the Environment issued recommendations for improvements and corrective actions to be taken at each of our airports (with which we have complied). In connection with the transfer of the management of our airports from our predecessor, we entered into environmental compliance agreements with the Federal Office for the Protection of the Environment on January 1, 1999, and July 12, 2000, pursuant to which we agreed to comply with a specific action plan and adopted specific actions within a determined time frame.

On June 6, 2012, the General Law on Climate Change was adopted and published in the Official Gazette of the Federation, which, among other objectives, (i) regulates greenhouse gases and emissions, taking into consideration the goals set forth by the UN Framework Convention on Climate Change and the provisions derived therein; (ii) promotes the education, research, development and technology transfer, innovation and promotion with respect to adapting to and mitigating climate change; and (iii) promotes the transition to a competitive, sustainable and low‑carbon economy. In accordance with the General Law of Climate Change, individuals and entities that are responsible for sources of emission that are subject to environmental reporting are obligated to compile necessary information, data and documents with respect to direct and indirect emissions for the inclusion in the Mexican National Registry of Emissions (Registro Nacional de Emisiones). This regulation was published on October 28, 2014. We have been obligated to comply with this requirement since February 15, 2016.

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Furthermore, on June 7, 2013, the Federal Law of Environmental Responsibility was published in the Federal Official Gazette and requires that any person or entity who, whether by act or omission, directly or indirectly, causes harm to the environment, is obligated to repair such harm. If repair of such harm is not possible, such person is required to pay compensation for the harm caused and take any action necessary to avoid any additional harm or damage. Likewise, this law establishes a judicial procedure for environmental responsibility through which any physical or moral person with a legitimate interest can sue for repair and compensation for harm done to the environment.

On August 11, 2014, the Mexican National Agency of Industrial Safety and Protection of the Environment of the Hydrocarbons Sector (Agencia Nacional de Seguridad Industrial y de Protección al Medio Ambiente del Sector Hidrocarburos, or “ASEA”) was created. While initially taking a secondary role to the role of the Mexican Ministry of the Environment and Natural Resources, ASEA has recently started to enforce its legal powers. Our airport growth projects related to fuel supply must now be approved by ASEA, which may result in more burdensome proceedings for the approval of special projects related to hydrocarbons. As of the date of this report, there can be no assurance whether ASEA’s rules and regulations will materially affect our business or results of operations.

In 2018, Mexico launched a new carbon dioxide (“CO₂”) market. The market requires that industries that generate above a certain amount of CO₂ emissions pay for rights to excess emissions. Starting in 2019, the legislation also requires that companies report their global emissions as verified by the Mexican Emissions Registry (Registro Nacional de Emisiones). In addition, new water quality standards are being discussed, which would require greater water quality for all of our wastewater disposal. For more information see “Item 3. Key Information—Risk Factors—Risks Related to Mexico—Mexico’s environmental legislation could limit the growth of some of our airports.”

Environmental Certification

Since 2011 we have been selected to be one of the members of the Sustainability Index by the Mexican Stock Exchange. The Mexican Stock Exchange Sustainability Index members were selected from among the 70 most traded stocks on the Mexican Stock Exchange based on evaluation criteria of corporate governance, environmental management and social responsibility. In 2018, we were selected again to be one of the members of the Mexican Stock Exchange Sustainability Index.

Liability for Environmental Noncompliance

The legal framework of environmental liability applicable to our operations is generally outlined above. Under the terms of our concessions, the Mexican government has agreed to indemnify us for any environmental liabilities arising prior to November 1, 1998, and for any failure by the Mexican Airport and Auxiliary Services ~~agency~~Agency prior to November 1, 1998, to comply with applicable environmental laws and with its agreements with Mexican environmental authorities. We believe that we are entitled to indemnification for any liabilities related to actions that our predecessor was required to perform or refrain from performing under applicable environmental laws and under their agreements with environmental authorities, though this may change in the future.

The level of environmental regulation in Mexico has significantly increased in recent years, and the enforcement of environmental laws is becoming substantially more stringent. We expect this trend to continue and expect additional norms to be imposed by the new trilateral agreement on Environmental Cooperation that will be entered into by Canada, the United States and Mexico in the context of the USMCA (which ~~is yet to be ratified by the relevant countries)~~was formally signed on November 30, 2018 and will enter into force July 1, 2020), as well as by other international treaties on environmental matters. In 2018, Mexico, the United States and Canada announced a Trilateral Agreement of Environmental Cooperation under the USMCA which, once in force, will replace the North American Agreement on Environmental ~~Coorperation~~Cooperation in force since January 1, 1994. We do not expect that compliance with Mexican federal, state or municipal environmental laws currently in effect will have a material adverse effect on our financial condition or results of operations. However, environmental regulations or the enforcement thereof may change in a manner that could have a material adverse effect on our business, results of operations, prospects and financial condition.

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ORGANIZATIONAL STRUCTURE

The following table sets forth our consolidated subsidiaries as of April ~~19, 2019,~~22, 2020, including our direct and indirect ownership interest in each:


Name of Company	Jurisdiction of Establishment	Percentage Owned	Description
Aeropuerto de Acapulco, S.A. de C.V.	Mexico	100	Holds concession for Acapulco International Airport

Aeropuerto de Ciudad Juárez, S.A. de C.V.	Mexico	100	Holds concession for Ciudad Juárez International Airport

Aeropuerto de Culiacán, S.A. de C.V.	Mexico	100	Holds concession for Culiacán International Airport

Aeropuerto de Chihuahua, S.A. de C.V.	Mexico	100	Holds concession for Chihuahua International Airport

Aeropuerto de Durango, S.A. de C.V.	Mexico	100	Holds concession for Durango International Airport

Aeropuerto de Mazatlán, S.A. de C.V.	Mexico	100	Holds concession for Mazatlán International Airport

Aeropuerto de Monterrey, S.A. de C.V.	Mexico	100	Holds concession for Monterrey International Airport

Aeropuerto de Reynosa, S.A. de C.V.	Mexico	100	Holds concession for Reynosa International Airport

Aeropuerto de San Luis Potosí, S.A. de C.V.	Mexico	100	Holds concession for San Luis Potosí International Airport

Aeropuerto de Tampico, S.A. de C.V.	Mexico	100	Holds concession for Tampico International Airport

Aeropuerto de Torreón, S.A. de C.V.	Mexico	100	Holds concession for Torreón International Airport

Aeropuerto de Zacatecas, S.A. de C.V.	Mexico	100	Holds concession for Zacatecas International Airport

Aeropuerto de Zihuatanejo, S.A. de C.V.	Mexico	100	Holds concession for Zihuatanejo International Airport

Servicios Aeroportuarios del Centro Norte, S.A. de C.V.	Mexico	100	Provider of administrative and other services.

Operadora de Aeropuertos del Centro Norte, S.A. de C.V.	Mexico	100	Provider of operational services.

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Name of Company	Jurisdiction of Establishment	Percentage Owned	Description
Holding Consorcio Grupo Hotelero T2, S.A. de C.V.	Mexico	100	Holds 90% of the shares of the Consortium to develop and operate an NH-branded hotel and commercial areas inside the Terminal 2 of Mexico City International Airport. A Mexican subsidiary of NH Hoteles SA, a Spanish company, owns the other 10%.

Consorcio Grupo Hotelero T2, S.A. de C.V.	Mexico	90	Holds a 20-year lease agreement with Mexico City International Airport to develop and operate a 287-room, 5-star hotel and more than 5,000 square meters (53,820 square feet) in commercial space inside Terminal 2.

Servicios Corporativos Terminal T2, S.A. de C.V.	Mexico	90	Provider of administrative and other services.

Servicios Complementarios del Centro Norte, S.A. de C.V.	Mexico	100	Provider of complementary services.

OMA Logística, S.A. de C.V.	Mexico	100	Develops and operates commercial areas in our concessionaries. Holds 85% of the shares of the investment project to develop and operate a Hilton Garden Inn and commercial areas at the Monterrey airport. Grupo Hotelero Santa Fe owns the remaining 15%. Holds 51% of the shares of OMA-VYNMSA Aero Industrial Park, S.A. de C.V., an investment project to develop, operate and build an industrial park at the Monterrey airport. VYNMSA owns the remaining 49%.

Servicios Aero Especializados del Centro Norte, S.A. de C.V.	Mexico	100	Provider of administrative and other services.

OMA-VYNMSA Aero Industrial Park, S.A. de C.V.	Mexico	51	Entity created to build and operate an industrial park at the Monterrey airport.

Consorcio Hotelero Aeropuerto Monterrey, S.A.P.I. de C.V.	Mexico	85	Holds a 20-year lease agreement with the Monterrey airport to develop and operate a 134-room hotel at the Monterrey airport under the brand Hilton Garden Inn.

Servicios Hoteleros Aeropuerto Monterrey, S.A. de C.V.	Mexico	85	Provider of administrative and other services.

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PROPERTY, PLANT AND EQUIPMENT

Pursuant to the Mexican National Assets Law, all real estate and fixtures in our airports are owned by the Mexican government. Each of our concessions is scheduled to terminate in 2048, although each concession may be extended one or more times for up to an aggregate of an additional 50 years. The option to extend a concession is subject to our acceptance of any changes to such concession that may be imposed by the Ministry of Communications and Transportation and our compliance with the terms of our current concessions. Upon expiration of our concessions, these assets automatically revert to the Mexican government, including improvements we may have made during the terms of the concessions, free and clear of any liens and/or encumbrances, and we will be required to indemnify the Mexican government for damages to these assets, including any improvements thereon, except for those caused by normal wear and tear.

We use the property constituting our airports pursuant to our concessions. For more information regarding our property, plant and equipment, see “Item 4. Business Overview—Our Airports.”

We maintain comprehensive insurance coverage that covers the principal assets of our airports and other property, subject to customary limits, against damage due to natural disasters, accidents, terrorism or similar events. We also maintain general liability insurance but do not maintain business‑interruption insurance. Among other insurance policies, we carry a U.S.$50.0 million insurance policy covering damages to our property resulting from certain terrorist acts and a U.S.$500 million policy covering personal and property damages to third parties. We also carry a U.S.$200.0 million insurance policy covering damage to our assets and infrastructure.

Item 4A. Unresolved Staff Comments

None.

Item 5. Operating and Financial Review and Prospects

The following discussion should be read in conjunction with, and is qualified in its entirety by reference to, our consolidated financial statements and the notes to those consolidated financial statements. It does not include all of the information included in our consolidated financial statements. You should read our consolidated financial statements to gain a better understanding of our business and our historical results of operations.

Our consolidated financial statements included in this annual report are prepared in accordance with IFRS, as issued by the IASB.

The financial information included in this report for the fiscal year ended December 31, 2019 has not been approved by the Company's shareholders at a meeting of such shareholders. The annual meeting for the Company's shareholders is scheduled to take place on June 19, 2020, in response to the measures the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores or “CNBV”) released on March 26, 2020 to prevent the spread of COVID-19.

Overview

We hold concessions to operate, maintain and develop 13 airports in Mexico, many of which are located in the northern and central regions of the country, pursuant to concessions granted by the Mexican government. The substantial majority of our revenues are derived from providing aeronautical services, which generally are related to the use of our airport facilities by airlines and passengers. For example, approximately ~~65.0%~~67.5% of our total revenues in ~~2018~~2019 were earned from aeronautical services and approximately 76.0% of the sum of our aeronautical and non‑aeronautical revenues in ~~2018~~2019 were earned from aeronautical services. Changes in our revenues from aeronautical services are principally driven by the passenger and cargo volume at our airports. Our revenues from aeronautical services are also affected by the maximum rates we are allowed to charge under the price regulation system established by the Ministry of Communications and Transportation and the specific prices that we negotiate with airlines for the provision of aeronautical services. The maximum rate system of price regulation that applies to our aeronautical revenues is linked to the traffic volume (measured in workload units) at each airport; thus, increases in passenger and cargo volume generally

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permit greater revenues from aeronautical services. In evaluating our aeronautical revenues, we focus principally on workload units, which measure volume, and aeronautical revenues per workload unit, which measures the contribution to aeronautical revenues from each workload unit.

~~Table of Contents~~

We also derive revenues from non‑aeronautical activities, which principally relate to the commercial activities carried out at our airports, such as the operation of parking facilities, advertising and the leasing of space to restaurants and retailers. We also derive non‑aeronautical revenues from diversification activities, such as hotel services, air cargo logistics services and real estate services; and complementary activities, which principally include the leasing of space to airlines and operating our baggage‑screening system. Our revenues from non‑aeronautical activities are not subject to the system of price regulation established by the Ministry of Communications and Transportation (though they may be subject to regulation by other authorities). Our commercial revenues are principally affected by the passenger volume at our airports, the mix of commercial activities carried out at our airports and our ability to increase the rates we charge to those service providers. We evaluate our non‑aeronautical revenues by analyzing changes in diversification, commercial and complementary revenues.

During ~~2018,~~2019, our business initiatives were focused on maximizing aeronautical revenues and increasing non‑aeronautical revenues through (i) the promotion of route development and the optimization of rates; (ii) improving the commercial offerings and the passenger experience inside our airport terminals; (iii) increasing the operations of our current diversification businesses related to airports, such as the Terminal 2 NH Collection Hotel at the Mexico City airport and the Hilton Garden Inn hotel at the Monterrey airport, our OMA Carga business and the OMA‑VYNMSA industrial park; and (iv) generating new sources of non‑aeronautical revenues through new diversification activities that we expect to increase our revenues in the coming years.

Recent Developments

~~Appointment of New Chief Executive Officer~~OMA Starts Expansion Project at the Monterrey International Airport

OnIn November ~~12, 2018,~~2019, we ~~appointed Ricardo Dueñas~~started a major expansion project at the Monterrey airport. We expect to invest approximately Ps.4.2 billion between 2019 and 2025, of which Ps.500 million correspond to our current master development program commitment. The project will be built in two phases. Phase 1 consists of the expansion of the public and check-in areas of Terminal A and the construction of a new wing. As a result, total terminal space will increase by over 15,000 square meters (161,459 square feet), approximately a 25% increase of then existing terminal space. Certain components of Phase 1 will become operational by the end of 2021, with all of Phase 1 to be ~~Chief Executive Officer, effective~~completed and operational by late 2022. Phase 2 consists of the construction of a second new wing, increasing terminal space by an additional 16,000 square meters (172,223 square feet). Phase 2 is expected to be completed by 2024. After both phases of the expansion, the Monterrey airport will have an annual capacity of 16.5 million passengers (up from 11.6 million passengers currently), positioning itself as one of ~~November 12, 2018. Mr. Ricardo Dueñas replaced Mr. Porfirio González, who retired from his position on~~ the ~~same date. For more information about Mr. Ricardo Dueñas’ prior experience, see “Item 6. Executive Officers.”~~busiest connection centers in northern Mexico.

Expansion and Remodeling of San Luis Potosí Airport Terminal Building

~~Appointment~~In November 2016, we started an expansion and remodeling of ~~New Members~~the terminal building at the San Luis Potosí airport, which was completed on August 16, 2019. The project had a total investment of ~~Management~~Ps.400 million and included an expansion of 8,600 square meters (92,570 square feet), for a total of 13,482 square meters (145,119 square feet). Passenger capacity grew threefold to serve up to 1.2 million passengers per year.

~~On July 19, 2018,~~Expansion and Remodeling of Chihuahua Airport Terminal Building

In December 2016, we ~~announced the appointment of (i) Adriana Díaz Galindo, as General Counsel; (ii) Enrique Navarro Manjarrez, as Director for Airport Operations;~~started an expansion and (iii) Enrique Chacón Tinajero, as Director for Infrastructure and Maintenance, effective as of June 1, 2018, April 26, 2018 and June 12, 2018, respectively. For more information about the prior experienceremodeling of the terminal building at the Chihuahua airport, which was completed on September 17, 2019. The project had a total investment of Ps.318 million and included 5,743 square meters (61,817 square feet) of new ~~members~~areas and the remodeling of ~~management, see “Item 6. Executive Officers.”~~9,510 square meters (102,365 square feet).

~~Inclusion in Dow Jones Sustainability Index for Emerging Markets~~

We were selected to be included in the Dow Jones Sustainability Index (DJSI) for Emerging Markets for the third consecutive year. This index represents the highest standard for corporate sustainability based on economic, environmental, social and corporate governance criteria. This is the third time that we have been selected for inclusion in the DJSI, from among 802 companies in developed economies and emerging markets. Only three companies in Mexico are included in the index, of which only OMA is in the transportation sector. The selection represents an important achievement for us and our partners, shareholders and employees.

We carry out our operations in accordance with corporate governance best practices, with the vision and commitment to respect and be mindful of the environment, and also by promoting the social well-being of our stakeholders through projects supported by our Sustainability Policy.COVID-19 Outbreak

The ~~DJSI Global index identifies companies that are leaders~~United States government has put in ~~sustainability practices based~~place travel restrictions in response to the COVID-19 pandemic, and closed the United States border with Mexico, except to essential travel and trade and commerce, on ~~the analysis of RobecoSAM and the S&P Dow Jones index methodology.~~

In addition, for the second consecutive year, we were included in the newly-launched Dow Jones Sustainability Index- MILA, among 140 companies in México, Perú, Chile and Colombia. Only thirteen Companies in México are included in the index, of which only OMA is in the transportation sector. The current DJSI-MILA is valid for one year.

March 20, 2020.

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~~New Terminal at Acapulco Airport~~The Mexican government has implemented various measures to control the spread of COVID-19, including extraordinary actions, such as school closures and the suspension of non-essential activities, in the regions most affected. On March 31, 2020, Mexico’s Ministry of Health issued a decree suspending all non-essential activities in the country through April 30, and on April 21, such suspension was extended through May 30, 2020. For purposes of these measures, airports are considered essential and our airports remain operational.

~~In May 2018,~~Some of our airline and other clients and tenants have asked for assistance, either through discounts on payments owed to us or by an extension on those payments. As of the ~~new terminal building at Acapulco airport was inaugurated~~date of this report, we are in commercial discussions with those clients and ~~started operations. It~~tenants regarding their contracts. We expect the COVID-19 pandemic to cause an increase in our reserve for doubtful accounts in 2020. The effects of the COVID-19 pandemic on our operations are still uncertain, however, we expect a significant reduction in passenger traffic in our airports as a result of the actions taken by the Mexican, United States and other governments and from the broader reduction in demand for air travel caused by the COVID-19 pandemic. Our total passenger traffic decreased 4.9% in the first quarter of 2020 compared to the first quarter of 2019, and 92.1% between April 1, 2020 and April 22, 2020 as compared to the same period in 2019. We expect passenger traffic to increase as travel restrictions are lifted and stay-at-home ordinances are repealed, but, as the date of this report, we cannot quantify the material adverse effect COVID-19 will have on our results of operations or financial performance for fiscal year 2020.

2020 Annual Shareholder Meeting

The annual meeting for the Company's shareholders has ~~an 18,800 square-meter (202,362 square-foot) surface, with three levels and a mezzanine. The new terminal has~~been scheduled to June 19, 2020, pursuant to CNBV measures released on March 26, 2020 to prevent the capacity to serve 1.3 million passengers per year and includes, among others, systems for operations, security, energy efficiency, passenger check-in and baggage screening. The project had a total investmentspread of ~~Ps.615 million since July 2016.~~COVID-19.

Operating Results

Certain U.S. dollar amounts have been translated from Mexican pesos for convenience purposes at an exchange rate of ~~Ps.19.6566~~Ps.18.8727 per U.S.$1.00, the ~~FIX~~ exchange rate as reported by the Mexican Central Bank on December 31, ~~2018.~~2019.

Passenger and Cargo Volumes

In ~~2018,~~2019, approximately ~~88.2%~~88.1% of the terminal passengers using our airports were domestic. Domestic traffic increased by ~~10.4%~~7.4% and international traffic increased by ~~4.4%~~7.9% as compared to ~~2017.~~2018. In addition, of the international passengers traveling through our airports, a majority has historically traveled on flights originating in or departing to the United States. Accordingly, our results of operations are influenced strongly by changes to Mexican economic conditions and to a lesser extent influenced by U.S. economic and other conditions, particularly trends and events affecting leisure travel and consumer spending.

Many factors affecting our passenger traffic volume and the mix of passenger traffic in our airports are beyond our control.

In ~~2016,~~ 2017, 2018 and ~~2018,~~2019, our 13 airports handled approximately ~~92,212,~~ 98,634, 100,914 and ~~100,914~~97,620 metric tons of cargo, respectively. The ~~increase~~decrease in ~~2018~~2019 was due to a ~~6.5% increase~~3.3% decrease in cargo transportation at the Monterrey airport and a ~~43.7% increase~~9.9% decrease in cargo transportation at the ~~Culiacán~~San Luis Potosí airport. Increases in our cargo volume are beneficial to us for purposes of the maximum‑rate calculations, as cargo increases the number of our workload units.

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The following table sets forth certain operating and financial data relating to our revenues and passenger and cargo volumes for the periods indicated:


	For the Year Ended December 31,						For the Year Ended December 31,
	2016		2017		2018		2017		2018		2019
Domestic terminal passengers(1)	16,387.95		17,219.95		19,016.38		17,219.95		19,016.38		20,416.76
International terminal passengers(1)	2,375.69		2,442.06		2,550.02		2,442.06		2,550.02		2,751.30
Total terminal passengers(1)	18,763.64		19,662.01		21,566.40		19,662.01		21,566.40		23,168.06
Cargo units(1)	922.12		986.34		1,009.14		986.34		1,009.14		976.20
Total workload units(1)	19,685.76		20,648.35		22,575.54		20,648.35		22,575.54		24,144.26
Change in total terminal passengers(2)	10.9	%	4.8	%	9.7	%	4.8	%	9.7	%	7.4	%
Change in workload units(2)	10.3	%	4.9	%	9.3	%	4.9	%	9.3	%	6.9	%

Aeronautical revenues(3)	3,872,735		4,347,031		5,140,052		4,347,031		5,140,052		5,752,662
Change in aeronautical revenues(2)	27.7	%	12.2	%	18.2	%	12.2	%	18.2	%	11.9	%
Aeronautical revenues per workload unit	196.7		210.5		227.7		210.5		227.7		238.3
Change in aeronautical revenues per workload unit(1)(2)	15.8	%	7.0	%	8.2	%	7.0	%	8.2	%	4.6	%

Non-aeronautical revenues(3)	1,332,762		1,456,338		1,625,497		1,456,338		1,625,497		1,819,605
Change in non-aeronautical revenues(2)	19.9	%	9.3	%	11.6	%	9.3	%	11.6	%	11.9	%
Non-aeronautical revenues per terminal passenger(4)	71.0		74.1		75.4		74.1		75.4		78.5
Change in non-aeronautical revenues per terminal passenger(2)	8.1	%	4.3	%	1.8	%	4.3	%	1.8	%	4.2	%
Non-aeronautical revenues per terminal passenger, excluding hotel services(4)(5)	54.4		56.7		59.3		56.7		59.3		63.1
Change in non-aeronautical revenues per terminal passenger, excluding hotel services(2)(5)	4.4	%	4.2	%	4.6	%	4.2	%	4.6	%	6.4	%

(1)

In thousands. One cargo unit is equivalent to 100 kilograms (220 pounds) of cargo. Under the regulation applicable to our aeronautical revenues, one workload unit is equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo.

(2)

In each case, as compared to previous period.

(3)

In thousands of pesos.

(4)

In pesos.

(5)

Figures presented for comparison purposes, as revenues from hotel services do not increase as a function of terminal passengers.

In ~~2018,~~2019, we served ~~21.6~~23.2 million terminal passengers, of which ~~19.0~~20.4 million were domestic and ~~2.6~~2.8 million were international. The increase in passengers in ~~2018~~2019 was principally due to an increase in the number of routes at several of our airports.

Classification of Revenues

We classify our revenues into three categories: revenues from aeronautical services, revenues from non‑aeronautical services and revenues from construction services. Historically, a substantial majority of our total revenues have been derived from aeronautical services. For example, in ~~2018, 65.0%~~2019, 67.5% of our total revenues were derived from aeronautical services, and the remainder of our revenues was derived from non‑aeronautical services and construction services. Aeronautical services represented 76.0% of the sum of our aeronautical and non‑aeronautical revenues.

Our revenues from aeronautical services are subject to price regulation under the applicable maximum rate at each of our airports and principally consist of passenger charges, aircraft landing and parking charges, airport security charges, passenger walkway charges, the leasing of space in our airports to airlines (other than first class/VIP lounges and other similar activities not directly related to essential airport operations) and complementary services (i.e., fees from handling and catering providers, permanent ground transportation operators and access fees from fuel providers at our airports).

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Our revenues from non‑aeronautical services are not subject to price regulation under our maximum rates and generally include revenues earned from: (i) commercial activities, such as car parking (which may be subject to certain municipal regulations, but not to our maximum rates), rental and royalty payments from third parties operating stores and providing commercial services at our airports, such as advertising, retail operators, food and beverage providers, car rental companies, time‑share sales and promotions service providers, duty‑free operators and fees collected from other miscellaneous sources, such as telecommunications providers, financial services ~~providers, telecommunications~~ providers and other passenger services providers; (ii) diversification activities, which include revenues earned by the operation of the Terminal 2 NH Collection Hotel of Mexico City International Airport, OMA Carga operations (air cargo logistics services), the Hilton Garden Inn hotel at the Monterrey airport and real estate services; and (iii) complementary activities, which principally include our checked baggage‑screening services, the leasing of space to airlines and complementary service providers for first class/VIP lounges and other activities not directly related to essential airport operations, as well as fees for access to federal zones.

We recognize revenues from construction services derived from the improvements made to airports that are included in our master development programs. Construction service revenues related to the airport concession are determined based on negotiations between us and the Ministry of Communication and Transportation (recognized according to the percentage‑of‑completion method), as we construct or improve the airports based on the master development programs. In ~~2018,~~2019, revenues from improvements to concessioned assets accounted for ~~14.4%~~11.2% of our total revenues.

For a detailed description of the components of our aeronautical and non‑aeronautical revenue categories, see “Item 4. Information on the Company—Business Overview—Our Sources of Revenues.”

Fluctuations in the Peso

~~From December 31, 2015 to December 31, 2016, the peso depreciated by approximately 19.9%, from Ps.17.20 per U.S.$1.00 on December 31, 2015, to Ps.20.62 per U.S.$1.00 on December 31, 2016.~~ From December 31, 2016 to December 31, 2017, the peso appreciated by approximately 4.7%, from Ps.20.62 per U.S.$1.00 on December 31, 2016, to Ps.19.64 per U.S.$1.00 on December 31, 2017. From December 31, 2017 to December 31, 2018, the peso remained the same at Ps.19.64 per U.S.$1.00. ~~The~~From December 31, 2018 to December 31, 2019, the peso appreciated by approximately 3.9%, from Ps.19.64 per U.S.$1.00 on December 31, 2018, to Ps.18.86 per U.S.$1.00 on December 31, 2019. In the first months of 2020, the peso depreciated, reaching ~~Ps.18.77~~Ps.24.59 per U.S.$1.00 on April ~~19, 2019.~~22, 2020.

International passengers and international flights pay tariffs denominated in U.S. dollars. However, these tariffs are generally collected in Mexican pesos 30 to 60 days following the date of each flight, and our maximum rates are set in Mexican pesos. Therefore, a significant depreciation of the Mexican peso as compared to the dollar during this 30 to ~~60 day~~60-day period could result in us exceeding our maximum rates, which would be a violation of our concession. We attempt to set our U.S. dollar-denominated tariffs so as to avoid exceeding our maximum rates, and so far, fluctuations in the peso have not caused us to exceed our maximum rates or required us to issue rebates to avoid exceeding our maximum rates.

In addition, we have financial liabilities denominated in U.S. dollars, and a significant depreciation in the Mexican peso could result in higher debt balances when converted to Mexican pesos, thus resulting in foreign exchange losses. We may also, from time to time, maintain cash balances denominated in U.S. dollars, in which cases a depreciation of the Mexican peso against the U.S. dollar could result in a foreign exchange gain. As of December 31, ~~2018, Ps.786~~2019, Ps.1,489 million of our cash balance was denominated in U.S. dollars.

As of December 31, ~~2018,~~2019, international passenger charges amounted to ~~Ps.1,061,793~~Ps.1,207,989 thousand, and as of December 31, ~~2018,~~2019, we had U.S.$~~13.2~~4.3 million of liabilities denominated in U.S. dollars.

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Aeronautical Revenues

The system of price regulation applicable to our aeronautical revenues establishes a maximum rate in pesos for each airport for each year in a five‑year period, which is the maximum annual amount of revenues per workload unit (a workload unit is equal to one terminal passenger or 100 kilograms (220 pounds) of cargo) that we may earn at that airport from aeronautical services. See “Item 4. Regulatory Framework—Revenue Regulation” for a description of our maximum rates and the rate setting procedures for future periods. The maximum rates for our airports have been determined for each year through December 31, 2020.

The following table sets forth our revenues from aeronautical services for the periods indicated:


	For the Year Ended December 31,									For the Year Ended December 31,
	2016			2017			2018			2017			2018			2019
	Amount	%		Amount	%		Amount	%		Amount	%		Amount	%		Amount	%
	(in thousands of pesos, except percentages)									(in thousands of pesos, except percentages)
Aeronautical revenues:
Domestic passenger charges	2,477,711	64.0	%	2,801,751	64.5	%	3,382,198	65.8	%	2,801,751	64.5	%	3,382,198	65.8	%	3,776,401	65.6	%
International passenger charges	810,519	20.9	%	921,539	21.2	%	1,061,793	20.7	%	921,539	21.2	%	1,061,793	20.7	%	1,207,989	21.0	%
Landing charges	167,298	4.3	%	178,638	4.1	%	205,787	4.0	%	178,638	4.1	%	205,787	4.0	%	229,919	4.0	%
Platform for embarking and disembarking	118,004	3.0	%	119,123	2.8	%	136,852	2.7	%	119,123	2.8	%	136,852	2.7	%	150,055	2.6	%
Aircraft parking charges on extended stay or overnight	33,242	0.9	%	31,923	0.7	%	36,402	0.7	%	31,923	0.7	%	36,402	0.7	%	35,910	0.6	%
Domestic and international passenger and carry-on baggage check	37,925	1.0	%	48,762	1.1	%	54,570	1.1	%	48,762	1.1	%	54,570	1.1	%	62,970	1.1	%
Aerocars and jetways	40,715	1.1	%	44,234	1.0	%	47,956	0.9	%	44,234	1.0	%	47,956	0.9	%	48,074	0.8	%
Other airport services, leases and regulated access(1)	187,321	4.8	%	201,061	4.6	%	214,494	4.1	%	201,061	4.6	%	214,494	4.1	%	241,342	4.2	%
Total aeronautical revenues	3,872,735	100.0	%	4,347,031	100.0	%	5,140,052	100.0	%	4,347,031	100	%	5,140,052	100	%	5,752,662	100	%

(1)

Includes regulated access fees, leasing of space to airlines for their operations and leasing of space in the airside to cargo handling agents and shippers.

Under the regulatory system applicable to our aeronautical revenues, we can set the specific price for each category of aeronautical services, other than complementary services and the leasing of space to airlines, every six months (or earlier upon a cumulative increase of 5% in the Mexican ~~producer price index~~Producer Price Index (excluding fuel) ),), as long as the total aeronautical revenues per workload unit each year at each of our airports does not exceed the maximum rate at that airport for that year. See “Item 4. Information on the Company—Regulatory Framework—Price Regulation” for a description of our maximum rates and the rate-setting procedures for future periods. We currently set the specific price for these categories of aeronautical services after negotiating with our principal airline customers. Historically, our specific prices have been structured such that the substantial majority of our aeronautical revenues are derived from passenger charges, and we expect this to continue to be the case in future agreements with our principal airline customers. In ~~2018,~~2019, passenger charges represented ~~86.5%~~86.6% of our aeronautical services revenues. In ~~2018,~~2019, aeronautical services represented ~~65.0%~~67.5% of our total revenues and ~~76.0%~~76.0% of the sum of our aeronautical and non‑aeronautical revenues.

Aeronautical revenue per workload unit is an indicator that is calculated by dividing total aeronautical revenues by the workload units for a given period. This indicator is affected annually, except for years in which the new maximum tariffs are set, by: (i) adjustment in the maximum rates for the efficiency factor and the Mexican ~~producer price index~~Producer Price Index (excluding fuel); (ii) increases and decreases in the relative number of workload units at each airport; and (iii) changes in total workload units per airport.

We, from time to time, seek to offer incentives, including discounts on charges for aeronautical services, to encourage carriers to establish new routes and take other measures expected to increase passenger traffic at our airports. The Mexican Airport Law prevents discriminatory pricing, so incentives we offer must be available to any carrier meeting the conditions specified for those incentives. The main objective is to promote passenger growth in all of our airports. We may continue to offer further incentives in the future.

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Such initiatives undertaken in the future may not be carried out, and may not increase our passenger traffic volume or our revenues.

In ~~2018,~~2019, our aeronautical revenues represented approximately ~~97.8%~~99.0% of the amount we were entitled to earn under the maximum rates applicable to all of our airports. To the extent that we offer incentives to carriers to establish routes serving our airports in the future, or other changes to our sources of aeronautical revenues, this percentage could decrease. We may not be able to collect substantially all of the revenues we are entitled to earn from services subject to price regulation in the future.

Non-Aeronautical Revenues

Non‑aeronautical services historically have generated a significantly smaller portion of our total revenues as compared to aeronautical services. Non-aeronautical revenues per terminal passenger are calculated by dividing total nonaeronautical revenues by the number of terminal passengers during the same period. The contribution to our total revenues from non‑aeronautical services was ~~20.6%~~21.3% in ~~2018.~~2019. Our non‑aeronautical revenues per terminal passenger increased from ~~Ps.74.1 in 2017 to~~ Ps.75.4 in 2018 to Ps.78.5 in 2019 due primarily to an increase in and improvement of diversification and commercial activities in all of our airports, especially our revenues from car parking, car rental, OMA Carga, baggage screening services, retail food and beverage and VIP lounges. Our non‑aeronautical revenues in ~~2018~~2019 represented 24.0% of the sum of our aeronautical and non‑aeronautical revenues, and our revenues from commercial activities per terminal passenger increased from ~~Ps.35.4 in 2017 to~~ Ps.36.8 in 2018 to Ps.39.5 in 2019, due primarily to an increase and improvement of commercial activities in all of our airports, especially our revenues from car parking, ~~car rental,~~ food and beverage operations, VIP lounges, retail and ~~retail.~~car rentals.

Certain categories of non-aeronautical revenues are directly impacted by passenger traffic (for example car parking and rental, and food and beverage providers) while others are not (for example leasing of space, on which we earn at least a minimum fixed rent indexed to inflation each year, which may be increased by royalty-based payments as discussed below, or diversification revenues). Accordingly, non-aeronautical revenues do not always behave in the same manner as passenger traffic or workload units.

A substantial amount of our contracts with third-party tenants are royalty-based arrangements. Under a royalty-based contract, the amount tenants must pay is based on tenants’ revenues, subject to minimum guaranteed fixed amounts for the space leased. When the royalty-based amount is lower than the minimum guaranteed amount, the tenant must still pay the latter. Conversely, when the royalty-based amount is higher than the minimum guaranteed amount, the tenant will pay the former. Therefore, a decrease in passenger traffic volumes would result in a reduction in non-aeronautical revenues only if, (i) prior to such decrease in passenger traffic, the sales of royalty-based tenants were higher than the minimum guaranteed amount and (ii) the decrease in traffic volumes is such that it would cause the royalty-based amount to be lower than the minimum guaranteed amount for a given tenant. As a result, during periods in which airports experience a reduction in passenger traffic volumes, non-aeronautical revenues may remain stable due to the minimum guaranteed amount received by the airport under the lease contract, thereby resulting in a potential increase in non-aeronautical revenues per workload unit.

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The following table sets forth our revenues from non-aeronautical activities for the periods indicated:


	For the Year Ended December 31,									For the Year Ended December 31,
	2016			2017			2018			2017			2018			2019
	Amount	%		Amount	%		Amount	%		Amount	%		Amount	%		Amount	%
	(in thousands of pesos, except percentages)									(in thousands of pesos, except percentages)
Non-aeronautical revenues:
Commercial activities:
Car parking charges	192,063	14.4	%	200,948	13.8	%	244,461	15.0	%	200,948	13.8	%	244,461	15.0	%	279,463	15.4	%
Advertising	120,591	9.0	%	106,045	7.3	%	68,475	4.2	%	106,045	7.3	%	68,475	4.2	%	76,200	4.2	%
Retail operations(1)	97,631	7.3	%	106,908	7.3	%	114,418	7.0	%	106,908	7.3	%	114,418	7.0	%	124,554	6.8	%
Food and beverage	85,995	6.5	%	101,577	7.0	%	120,828	7.4	%	101,577	7.0	%	120,828	7.4	%	144,374	7.9	%
Car rental operators	75,966	5.7	%	92,770	6.4	%	131,478	8.1	%	92,770	6.4	%	131,478	8.1	%	149,454	8.2	%
Time share developers	13,967	1.0	%	13,193	0.9	%	14,115	0.9	%	13,193	0.9	%	14,115	0.9	%	16,663	0.9	%
Financial services	6,457	0.5	%	7,418	0.5	%	9,255	0.6	%	7,418	0.5	%	9,255	0.6	%	10,367	0.6	%
Communication and services	10,362	0.8	%	13,604	0.9	%	15,551	1.0	%	13,604	0.9	%	15,551	1.0	%	16,006	0.9	%
Services to passenger	2,803	0.2	%	2,662	0.2	%	2,746	0.2	%	2,662	0.2	%	2,746	0.2	%	4,127	0.2	%
VIP lounges	16,937	1.3	%	20,453	1.4	%	36,649	2.3	%	20,453	1.4	%	36,649	2.3	%	51,176	2.8	%
Loyalty program	911	0.1	%	—	—		—	—
Other commercial revenues(3)	26,787	2.0	%	31,420	2.2	%	36,607	2.3	%	31,420	2.2	%	36,607	2.3	%	43,542	2.4	%
Total commercial activities	650,470	48.8	%	696,998	47.9	%	794,583	49.0	%	696,998	47.9	%	794,583	49.0	%	915,927	50.3	%
Diversification activities:
Hotel services	311,679	23.4	%	340,279	23.4	%	344,307	21.2	%	340,279	23.4	%	344,307	21.2	%	357,032	19.6	%
OMA Carga	132,211	9.9	%	152,963	10.5	%	177,396	10.9	%	152,963	10.5	%	177,396	10.9	%	194,936	10.7	%
Real estate services	12,988	1.0	%	12,328	0.8	%	16,352	1.0	%	12,328	0.8	%	16,352	1.0	%	18,181	1.0	%
Industrial services	4,952	0.4	%	14,647	1.0	%	26,340	1.6	%	14,647	1.0	%	26,340	1.6	%	39,451	2.2	%
Other diversification revenues(3)	5,852	0.4	%	4,405	0.3	%	4,061	0.2	%	4,405	0.3	%	4,061	0.2	%	4,966	0.3	%
Total diversification activities	467,682	35.1	%	524,622	36.0	%	568,456	34.9	%	524,622	36.0	%	568,456	34.9	%	614,565	33.8	%
Complementary Activities:
Leasing of space(2)	67,784	5.1	%	73,575	5.1	%	74,887	4.6	%	73,575	5.1	%	74,887	4.6	%	83,477	4.6	%
Access rights	13,984	1.0	%	16,538	1.1	%	18,023	1.1	%	16,538	1.1	%	18,023	1.1	%	19,709	1.1	%
Documented baggage inspection	121,400	9.1	%	132,262	9.1	%	153,192	9.4	%	132,262	9.1	%	153,192	9.4	%	175,006	9.6	%
Other complementary revenues(4)	11,442	0.9	%	12,343	0.8	%	16,356	1.0	%	12,343	0.8	%	16,356	1.0	%	10,922	0.6	%
Total complementary activities	214,610	16.1	%	234,718	16.1	%	262,458	16.1	%	234,718	16.1	%	262,458	16.1	%	289,113	15.9	%
Total revenues from non-aeronautical services	1,332,762	100.0	%	1,456,338	100.0	%	1,625,497	100.0	%	1,456,338	100.0	%	1,625,497	100.0	%	1,819,605	100.0	%

(1)

Includes revenues from duty-free operations.

(2)

Includes the leasing of space in our airports to airlines and complementary service providers (for first class/VIP lounges and other similar non-essential activities).

(3)

Other revenues consist mainly of recovery of costs for utility, marketing, security and maintenance charges that are transferred to airlines and other tenants in our airports.

(4)

Other complementary revenues consist of the recovery of costs for utility, marketing, security and maintenance charges that are transferred to airlines and other tenants in our airports, among others.

The majority of our non‑aeronautical revenues are derived from commercial activities, which represented ~~49.0~~50.3% of our non‑aeronautical revenues in ~~2018.~~2019. Commercial activities include car parking charges (which may be subject to government regulation, but not to our maximum rates), rental and royalty payments from third parties operating retail stores and providing commercial services at our airports, such as advertising, food and beverage providers, car rentals, time‑share sales and promotions services, duty‑free stores and fees collected from other miscellaneous sources, such as telecommunications providers, financial services providers and other passenger services providers.

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On an individual basis, our most important source of non‑aeronautical revenues is hotel services provided by both Terminal 2 NH Collection Hotel at the Mexico City International Airport and the Hilton Garden Inn Hotel at the Monterrey airport, which represented ~~21.2%~~19.6% of our non‑aeronautical revenues in ~~2018~~2019 and are part of our diversification activities. Other than hotel services, diversification activities include OMA Carga operations (air and ground cargo logistics services) and real estate services.

Complementary activities represented ~~16.1%~~15.9% of our non‑aeronautical revenues in ~~2018.~~2019. These activities primarily include baggage‑screening services, the leasing of space to airlines and complementary service providers for first class/VIP lounges and other activities not directly related to essential airport operations; as well as fees for access to federal zones.

Operating Costs

Our operating costs have been, and we believe that they will continue to be, funded entirely from our results of operations. The following table sets forth our operating costs and certain other related information for the periods indicated:


	For the Year Ended December 31,									For the Year Ended December 31,
	2016			2017			2018			2017				2018												2019
	Amount	% Change		Amount	% Change		Amount	% Change		Amount	% Change				Amount			% Change							Amount				% Change
	(in thousands of pesos, except percentages)									(in thousands of pesos, except percentages)
Operating Costs:
Cost of services:
Wages and salaries	203,912	6.4	%	219,890	7.8	%	231,753	5.4	%	219,890	7.8	%			231,753				5.4			%			242,237					4.5			%
Maintenance	157,740	6.6	%	184,246	16.8	%	152,583	(17.2)	%	184,246	16.8	%			152,583				(17.2)			%			177,191					16.1			%
Security and insurance	167,678	9.6	%	176,197	5.1	%	170,549	(3.2)	%	176,197	5.1	%			170,549				(3.2)			%			161,351					(5.4)			%
Utilities (electricity, cleaning and water)	158,956	17.0	%	189,238	19.1	%	210,158	11.1	%	189,238	19.1	%			210,158				11.1			%			177,250					(15.7)			%
Building lease	41,031	7.2	%	45,181	10.1	%	44,359	(1.8)	%	45,181	10.1	%			44,359				(1.8)			%			15,683					(64.6)			%
Allowance for doubtful accounts	749	(168)		(10,561)	N/A		(5,960)	(43.6)	%	(10,561)	N/A				(5,960)				(43.6)			%			(241)					(96)			%
Cost of hotel service	58,607	37.1	%	65,034	11.0	%	65,853	1.3	%	65,034	11.0	%			65,853				1.3			%			85,706					30.1			%
Employee statutory profit sharing	2,121	(12.0)	%	1,568	(26.1)	%	1,099	(29.9)	%	1,568	(26.1)	%			1,099				(29.9)			%			236					(78.5)			%
Equipment lease, fees and other	109,347	(12.8)	%	110,272	0.8	%	107,502	(2.5)	%	110,272	0.8	%			107,502				(2.5)			%			94,794					(11.8)			%
Total cost of services	900,141	7.7	%	981,065	9.0	%	977,896	(0.3)	%	981,065	9.0	%			977,896				(0.3)			%			954,207					(2.4)			%
Major maintenance provision	262,871	50.8	%	291,038	10.7	%	248,636	(14.6)	%	291,038	10.7	%			248,636				(14.6)			%			292,324					17.6			%
Cost of construction	344,772	(0.9)	%	1,326,458	284.7	%	1,141,505	(13.9)	%	1,326,458	284.7		%				1,141,505				(13.9)			%				954,834				(16.4)			%
Administrative expenses	642,345	15.1	%	587,917	(8.5)	%	563,151	(4.2)	%	587,917	(8.5)	%				563,151				(4.2)			%				542,664				(3.6)			%
Right to use airport facilities	244,215	16.4	%	271,331	11.1	%	319,180	17.6	%	271,331	11.1	%				319,180				17.6			%				363,561				13.9			%
Technical assistance fees	117,987	20.6	%	135,074	14.5	%	172,610	27.8	%	135,074	14.5	%				172,610				27.8			%				150,108				(13.0)			%
Depreciation and amortization(1)	276,634	15.8	%	299,205	8.2	%	351,745	17.6	%	299,205	8.2	%				351,745				17.6			%				415,252				18.1			%
Other income, net	(22,250)	221.1	%	(1,380)	(93.8)	%	(205)	(85.1)	%	(1,380)	(93.8)	%				(205)				(85.1)			%				(1,155)				463.4			%
Total operating costs	2,766,715	12.6	%	3,890,708	40.6	%	3,774,518	(3.0)	%	3,890,708	40.6	%				3,774,518				(3.0)			%				3,671,795				(2.7)			%

(1)

Depreciation reflects depreciation of fixed assets, and amortization reflects amortization of our concessions and rights to use airport facilities.

Cost of Services

Our cost of services consists primarily of employee, maintenance, safety, security and insurance costs, utilities (a portion of which we recover from our tenants) and other miscellaneous expenses.

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Major maintenance provision

We are required to perform major maintenance activities to our airports as established by our concession provided by the Mexican government. The estimated major maintenance costs are based on our master development programs, which are reviewed and updated every five years. The contractual obligations to maintain and restore the infrastructure of our airports is recognized as a provision in our consolidated statements of financial position based on an estimate of the expenditure that would be required to settle the present obligation at the end of the reporting period. When the effect of the time value of money is material, the amount of the provision equals the present value of the expenditures expected to be required to settle the obligation. Where discounting is used, the carrying amount of the provision increases each period to reflect the passage of time and this increase is recognized as a borrowing cost. After initial recognition, provisions are reviewed at the end of each reporting period and adjusted to reflect current best estimates. Adjustments to provisions arise from three sources: (i) revisions to estimated cash flows (both in amount and timing); (ii) changes to present value due to the passage of time; and (iii) revisions of discount rates to reflect prevailing current market conditions. In periods following the initial recognition and measurement of the major maintenance provision at its present value, the provision is revised to reflect estimated cash flows being closer to the measurement date. The unwinding of the discount relating to the passage of time is recognized as a financing cost and the revision of estimates of the amount and timing of cash flows is a reassessment of the provision and charged or credited as an operating item within our consolidated statements of income and other comprehensive income.

Every quarter, the major maintenance provision is revised to update the amount that has been provided for in order to keep the provision as accurate as possible. The provision could increase or decrease, as a result of certain events, such as, on the one hand, a contingency in an airport that requires immediate major maintenance or other maintenance that has been delayed or, on the other hand, an asset that does not need maintenance, in which case resources can be better used for other activities.

Construction Costs

We invest in additions and upgrades to our concession assets in accordance with our master development programs. As our construction costs are equal to our revenues from construction services, they do not have a cash impact on our results of operations.

Administrative Expenses

Our administrative expenses consist primarily of personnel expenses, fees and expenses paid to consultants and other providers of professional services and other administrative overhead expenses.

Concession Tax

Beginning November 1, 1998, we became subject to Article 232‑A of the Mexican Federal Duties Law, which requires that the holders of concessions pay a tax for the use of state‑owned assets. This tax is currently equal to 5% of the gross annual revenues of each concession holder obtained from the use of public domain assets pursuant to the terms of its concession. The concession tax may be revised at any time by the Mexican government, and this tax may increase in the future. If the Mexican government increases the concession tax, we are entitled to request an increase in its maximum rates from the Ministry of Communications and Transportation; however, the Ministry of Communications and Transportation may not honor such requests in the future.

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Technical Assistance Fee

Under the Technical Assistance Agreement, SETA provides management and consulting services and transfers technical assistance and technological and industry knowledge and experience to us in exchange for a fee. For more information about this agreement, see “Item 7. Major Shareholders and Related-Party Transactions—Related Party Transactions.” The technical assistance fee for each of 2001 and 2002 was fixed at U.S.$5.0 million (adjusted annually for U.S. inflation). For the remainder of the original contract term, the fee was equal to the greater of U.S.$3.0 million adjusted annually for inflation (measured by the U.S. consumer price index) or 5% of our EBITDA. Pursuant to the extension and amendment to the Technical Assistance Agreement signed on May 13, 2015, as of June 14, 2015, the fee was reduced to the greater of U.S.$3,478,000 (updated annually according to the U.S. consumer price index) and 4% of our EBITDA for the first three years of the extension and 3% of our EBITDA for the last two years of the extension.

Depreciation and Amortization

Our depreciation and amortization expenses primarily reflect the amortization of our investment in our 13 concessions. In ~~2018,~~2019, our depreciation and amortization expenses increased by ~~17.6%~~18.1%, as compared to ~~2017,~~2018, primarily due to an increase in the investment to improve ~~the concession’s~~our concessions’ assets during ~~2018.~~2019.

The value of our concessions was determined in June 2000, when SETA won the bid to acquire Series BB shares currently representing ~~12.6%~~12.8% of our capital stock, based on the value assigned by the independent company INGENIAL. In addition, we depreciate the value of certain fixed assets that we acquire or build at our airports pursuant to the investment requirements under our master development programs. For further information regarding depreciation and amortization expenses, refer to Notes 9 and 10 to our audited consolidated financial statements.

Solidarity Fees

We and our subsidiaries have entered into inter‑company agreements under which we provide services and make payments among us and our subsidiaries. The payments under these agreements affect the revenues, operating costs and income at our individual subsidiaries but not our consolidated results. Under the intercompany agreements, our parent company Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., or GACN, and our administrative services subsidiaries provide certain services and guarantees to our airport operating subsidiaries (which may include payments to certain of our airport operating subsidiaries), in exchange for which our airport operating subsidiaries make payments to GACN and the service subsidiaries. Each of our airports has entered into a “Solidarity Agreement” with our parent company, pursuant to which each of our airport operating subsidiaries pays a solidarity fee to GACN in exchange for which GACN guarantees the ongoing viability of that subsidiary’s concession, including, in the case of certain subsidiaries, by making payments to those subsidiaries to ensure that they have the resources to comply with their master development programs and other regulatory obligations. As described under “Item 4. Information on the Company—Regulatory Framework—General Obligations of Concession Holders,” in the event of a breach of one concession, the Ministry of Communications and Transportation is entitled to revoke all of the concessions held by our airport operating subsidiaries. Therefore, our airport operating subsidiaries that generate higher revenues pay higher solidarity fees to our parent company to ensure the continued viability of the concessions held by our airport operating subsidiaries that generate lower revenues. Amounts paid pursuant to the Solidarity Agreements are determined in accordance with Mexican transfer pricing regulations established under the Mexican Income Tax Law and are in line with a transfer pricing study that we commission annually from an independent third party. The intercompany agreements also include agreements to provide other routine services, including negotiating regulated tariffs and interfacing with regulators, leasing of commercial real estate, trademark license royalties, marketing services and employee costs. The costs of these services and guarantees, including the solidarity fees, are actual costs that are charged to individual airports.

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Capital Expenditures

In ~~2018,~~2019, capital expenditures were ~~Ps.1,314,363~~Ps.1,048,926 thousand. We funded our capital expenditures through cash flows from operations, and we believe that we will continue to fund them through cash flow from operations, as well as new debt, in the future. See “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources.”

Employee Statutory Profit Sharing

We are subject to the mandatory statutory employee profit sharing regime (participación de los trabajadores en las utilidades de las empresas, or “PTU”) established by the Mexican Federal Labor Law. Under this regime, 10% of a company’s unconsolidated annual profits, as calculated for tax purposes, must be distributed among employees other than the chief executive officer.

Taxation

The recognition of a deferred tax asset from previous years represented ~~Ps.7,691~~Ps.42,355 thousand for the year ended December 31, ~~2018.~~2019. As a result, in ~~2018,~~2019, we had an effective tax rate of ~~28.1%~~29.8%.

The statutory Mexican corporate income tax rate in 2019, 2018 ~~2017~~ and ~~2016~~2017 was 30.0%.

A withholding tax at a rate of 10% on the gross amount of dividends distributed to non‑Mexican holders with respect to our Series B shares and our ADSs was enacted as part of the 2013 tax reforms. For a further discussion of the withholding tax, see “Item 10. Additional Information—Taxation—Taxation of Dividends.”

Effects of Devaluation and Inflation

The following table sets forth, for the periods indicated, the percentage that the Mexican peso devalued or appreciated against the U.S. dollar, the Mexican inflation rate, the U.S. inflation rate and the percentage that Mexican GDP changed as compared to the previous period:


	For the Year Ended December 31,				For the Year Ended December 31,
	2017		2018		2018		2019
Depreciation of the Mexican peso as computed to the U.S. dollar(1)	(4.7)	%	—	%	—	%	(3.9)	%
Mexican inflation rate(2)	6.8	%	4.8	%	4.8	%	2.8	%
U.S. inflation rate(3)	2.1	%	1.9	%	1.9	%	2.1	%
Increase in Mexican GDP(4)	2.0	%	2.0	%	2.0	%	(0.1)	%

(1) Based on changes in the noon buying rate for Mexican pesos, as published by the U.S. Federal Reserve at the end of each period, which were as follows: Ps.19.64 per U.S.$1.00 as of December 31, ~~2017~~2018 and ~~Ps.19.64~~Ps.18.86 per U.S.$1.00 as of December 31, ~~2018.~~2019.

(2) Based on changes in the Mexican Consumer Price Index from the previous period, as reported by the Mexican Central Bank. The year‑end Mexican Consumer Price Index was ~~98.2729 in 2017 and~~ 103.0200 in ~~2018.~~2018 and 105.9340 in 2019.

(3) Based on changes in the Consumer Price Index for all urban consumers before seasonal adjustment, as reported by the U.S. Department of Labor, Bureau of Labor Statistics.

(4) In real terms, as reported by the Mexican Central Bank.

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The general condition of the Mexican economy, the devaluation of the peso as compared to the U.S. dollar, inflation and high interest rates have in the past adversely affected, and may in the future adversely affect, the following:

Passenger charges. Passenger charges for international passengers are currently denominated in U.S. dollars (although invoiced and paid in Mexican pesos), while passenger charges for domestic passengers are denominated in pesos. Consequently, an appreciation of the peso against the U.S. dollar could cause declines in our revenues from passenger charges for international passengers and consequently our aeronautical revenues. This would also produce a decline in peso-denominated revenues when compared with the previous year, because our tariffs for the services we provide to international flights or international passengers are denominated in U.S. dollars but are generally invoiced and paid for in Mexican pesos based on the average exchange rate for the month prior to each flight on which the charge is incurred.

Exchange gains and losses. Our consolidated statement of comprehensive income reflects gains and losses from foreign exchange transactions and could be impacted by exchange rates (to the extent of our foreign currency transactions). A portion of our indebtedness is denominated in U.S. dollars. Given that a substantial portion of our revenues are collected or converted into Mexican pesos, a depreciation in the peso as against the dollar would result in us having to spend more pesos for payment of dollar-denominated indebtedness, whereas an appreciation of the peso would result in us spending fewer pesos for dollar-denominated indebtedness ~~payments.In~~payments. In addition, our cash balance may be, from time to time, denominated in U.S. dollars, in which ~~cases~~case a depreciation of the Mexican peso against the U.S. dollar could result in a foreign exchange gain.

Cash flows. Our cash flows are affected by changes in exchange rates as a result of holding monetary assets and liabilities in foreign currencies.

Maximum rates in Mexican pesos. The tariffs for the services that we provide for international flights or international passengers are generally denominated in U.S. dollars but are paid in Mexican pesos based on the average exchange rate for the month prior to each flight. Accordingly, depreciation of the peso, particularly late in the year, could cause us to exceed the maximum rates at one or more of our airports, which could lead to the imposition of fines and the subsequent termination of one or more of our concessions. In addition, if the Mexican peso appreciates as compared to the U.S. dollar, we may underestimate the specific prices we can charge for regulated services and be unable to adjust our prices upwards to maximize our regulated revenues.

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~~Operating Results by Segment~~Regional Destinations

Chihuahua International Airport

The ~~following table sets forth~~Chihuahua airport is our third most important airport based on passenger traffic and air traffic movements and our third most important airport based on aeronautical revenues. According to the AFAC, the Chihuahua airport was the 12th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, it accounted for approximately 7.2%, 7.2% and 7.3%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 1,409,579, 1,556,770 and 1,699,816 terminal passengers, respectively, were served by the Chihuahua airport. Of the terminal passengers in 2017, 92.1% were domestic, and 7.9% were international. In 2018, 92.2% were domestic, and 7.8% were international. In 2019, 92.1% were domestic, and 7.9% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of ten commercial airlines operate at the airport. In 2019, airlines operating at this airport served 18 direct destinations, including fourteen domestic destinations and four international destinations. In 2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Monterrey, Guadalajara, Cancún, Tijuana, Hermosillo, Querétaro, Mérida, Dallas, Houston and Denver. In 2019, the principal domestic airlines operating at this airport were Volaris, Aeroméxico Connect, VivaAerobus, Interjet, TAR and Aeroméxico and the principal non‑Mexican airlines were American Airlines and United.

The Chihuahua airport is located approximately 18 kilometers (11 miles) from the city of Chihuahua, the capital of the state of Chihuahua. The city’s population is 878,062. Chihuahua’s close proximity to the United States and its highly developed maquiladora industry account for the ~~periods indicated for each of our airports, our hotel services~~majority the airport’s incoming and ~~our industrial services.~~outgoing traffic.

For the Year Ended December 31,


2016

2017

2018

(in thousands of pesos, except percentages)

Metropolitan Destination







Monterrey:







Revenues:







Aeronautical services

1,799,823

2,046,097

2,447,993

Non-aeronautical services

560,016

547,586

649,393

Construction services

97,631

367,214

232,698

Total revenues

2,457,470

2,960,897

3,330,084

Operating costs:







Costs and administrative expenses

343,052

365,806

383,309

Major maintenance provision

64,794

72,284

56,985

Construction costs

97,631

367,214

232,698

Depreciation and amortization

76,016

84,142

103,454

Solidarity fee

1,402,061

1,552,711

1,738,583

Total operating costs

1,983,554

2,442,157

2,515,029

Income from operations

473,916

518,740

815,055

Operating margin(1)

19.3
%
17.5
%
24.5
%

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For the Year Ended December 31,


2016

2017

2018

(in thousands of pesos, except percentages)

Tourist Destinations







Acapulco:







Revenues:







Aeronautical services

149,214

158,448

182,663

Non-aeronautical services

30,446

34,089

34,279

Construction services

76,772

372,253

279,099

Total revenues

256,432

564,790

496,041

Operating costs:







Costs and administrative expenses

37,435

60,628

59,847

Major maintenance provision

2,934

8,476

9,211

Construction costs

76,772

372,253

279,099

Depreciation and amortization

19,466

20,105

33,125

Solidarity fee

80,364

64,795

71,299

Total operating costs

216,971

526,257

452,581

Income from operations

39,461

38,533

43,460

Operating margin(1)

15.4
%
6.8
%
8.8
%

Mazatlán:







Revenues:







Aeronautical services

221,522

249,479

276,126

Non-aeronautical services

46,879

47,819

46,754

Construction services

19,527

30,204

31,308

Total revenues

287,928

327,502

354,188

Operating costs:







Costs and administrative expenses

53,470

61,073

64,062

Major maintenance provision

12,490

16,913

16,297

Construction costs

19,527

30,204

31,308

Depreciation and amortization

15,458

15,814

16,594

Solidarity fee

131,931

144,031

144,273

Total operating costs

232,876

268,035

272,534

Income from operations

55,052

59,467

81,654

Operating margin(1)

19.1
%
18.2
%
23.1
%

Zihuatanejo:







Revenues:







Aeronautical services

141,091

167,550

167,578

Non-aeronautical services

26,280

27,334

22,934

Construction services

25,699

28,039

13,534

Total revenues

193,070

222,923

204,046

Operating costs:







Costs and administrative expenses

28,391

42,645

43,740

Major maintenance provision

17,170

20,566

17,228

Construction costs

25,699

28,039

13,534

Depreciation and amortization

16,680

17,347

18,266

Solidarity fee

69,185

75,351

67,683

Total operating costs

157,125

183,948

160,451

Income from operations

35,945

38,975

43,595

Operating margin(1)

18.6
%
17.5
%
21.4
%

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For the Year Ended December 31,


2016

2017

2018

(in thousands of pesos, except percentages)

Regional Destinations







Chihuahua:







Revenues:







Aeronautical services

272,921

308,746

364,755

Non-aeronautical services

48,374

52,742

56,128

Construction services

16,061

122,412

141,546

Total revenues

337,356

483,900

562,429

Operating costs:







Costs and administrative expenses

51,000

58,522

60,372

Major maintenance provision

28,066

18,446

20,392

Construction costs

16,061

122,412

141,546

Depreciation and amortization

11,853

12,683

13,462

Solidarity fee

166,118

199,542

222,676

Total operating costs

273,098

411,605

458,448

Income from operations

64,258

72,295

103,981

Operating margin(1)

19.0
%
14.9
%
18.5
%

Culiacán:







Revenues:







Aeronautical services

351,096

409,399

539,540

Non-aeronautical services

48,280

53,296

57,313

Construction services

9,608

43,362

33,888

Total revenues

408,984

506,057

630,741

Operating costs:







Costs and administrative expenses

66,614

71,442

76,788

Major maintenance provision

11,251

10,368

10,514

Construction costs

9,608

43,362

33,888

Depreciation and amortization

16,006

16,147

17,408

Solidarity fee

225,630

272,181

346,376

Total operating costs

329,109

413,500

484,974

Income from operations

79,875

92,557

145,767

Operating margin(1)

19.5
%
18.3
%
23.1
%

Durango:







Revenues:







Aeronautical services

98,550

100,884

112,310

Non-aeronautical services

11,026

11,061

10,822

Construction services

4,381

19,974

13,788

Total revenues

113,957

131,919

136,920

Operating costs:







Costs and administrative expenses

22,816

26,242

24,949

Major maintenance provision

14,649

18,130

13,951

Construction costs

4,381

19,974

13,788

Depreciation and amortization

5,965

6,140

6,558

Solidarity fee

47,129

39,045

48,335

Total operating costs

94,940

109,531

107,581

Income from operations

19,017

22,388

29,339

Operating margin(1)

16.7
%
17.0
%
21.4
%

~~104~~

~~Table of Contents~~

For the Year Ended December 31,


2016

2017

2018

(in thousands of pesos, except percentages)

San Luis Potosí:

Revenues:

Aeronautical services

130,337

149,823

167,030

Non-aeronautical services

23,666

24,603

30,275

Construction services

24,456

108,756

231,726

Total revenues

178,459

283,182

429,031

Operating costs:

Costs and administrative expenses

26,310

28,283

30,189

Major maintenance provision

28,384

29,556

30,698

Construction costs

24,456

108,757

231,726

Depreciation and amortization

7,105

7,934

8,711

Solidarity fee

61,403

79,575

88,041

Total operating costs

147,658

254,105

389,365

Income from operations

30,801

29,077

39,666

Operating margin(1)

17.3
%
10.3
%
9.2
%

Tampico:

Revenues:

Aeronautical services

162,389

171,550

190,502

Non-aeronautical services

22,735

25,859

26,891

Construction services

32,053

46,742

26,169

Total revenues

217,177

244,151

243,562

Operating costs:

Costs and administrative expenses

38,053

40,495

46,136

Major maintenance provision

10,782

14,583

8,327

Construction costs

32,053

46,742

26,169

Depreciation and amortization

6,567

7,697

8,605

Solidarity fee

92,697

95,152

106,706

Total operating costs

180,152

204,669

195,943

Income from operations

37,025

39,482

47,619

Operating margin(1)

17.0
%
16.2
%
19.6
%

Torreón:

Revenues:

Aeronautical services

151,251

156,158

184,396

Non-aeronautical services

20,087

22,478

22,655

Construction services

5,722

20,017

19,991

Total revenues

177,060

198,653

227,042

Operating costs:

Costs and administrative expenses

31,367

33,931

36,732

Major maintenance provision

16,916

19,361

11,198

Construction costs

5,722

20,017

19,991

Depreciation and amortization

8,515

8,726

9,426

Solidarity fee

80,272

80,878

100,811

Total operating costs

142,792

162,913

178,158

Income from operations

34,268

35,740

48,884

Operating margin(1)

19.4
%
18.0
%
21.5
%

Zacatecas:

Revenues:

Aeronautical services

87,616

95,153

105,626

Non-aeronautical services

10,120

12,172

11,935

Construction services

7,677

19,174

9,656

Total revenues

105,413

126,499

127,217

Operating costs:

Costs and administrative expenses

24,425

29,231

25,056

Major maintenance provision

17,315

19,843

10,230

Construction costs

7,677

19,174

9,656

Depreciation and amortization

6,656

6,815

7,460

Solidarity fee

29,793

32,082

47,148

Total operating costs

85,866

107,145

99,550

Income from operations

19,547

19,354

27,667

Operating margin(1)

18.5
%
15.3
%
21.7
%

~~105~~60

Table of Contents

The Chihuahua airport operates 14 hours a day. The airport has three runways, with lengths of 2,600 meters (8,530 feet), 2,420 meters (7,940 feet) and 1,100 meters (3,609 feet), respectively. The runway system has a capacity of 40 air traffic movements per hour. The airport also has an instrument landing system on runway 36. The airport occupies a total area of approximately 909.2 hectares (3.51 square miles). The airport’s facilities include a terminal building with a total area of approximately 7,951 square meters (85,584 square feet), including 1,925 square meters (20,720 square feet) of commercial space, a seven‑position apron for commercial aviation, two aprons with a total of 21 positions for general aviation, four taxiways, a one‑position apron for airfreight and one air bridge. The airport has six gates for international or domestic flights. The Chihuahua airport has a public parking facility that accommodates 475 vehicles.

In December 2016, we started an expansion and remodeling of the terminal building at the Chihuahua airport, which was completed on September 17, 2019. The project had a total investment of Ps.318 million and included 5,743 square meters (61,817 square feet) of new areas and the remodeling of 9,510 square meters (102,365 square feet).

Culiacán International Airport

The Culiacán airport is our second most important airport based on passenger traffic, air traffic movements and contribution to aeronautical revenues. According to the AFAC, the Culiacán airport was the 10th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, it accounted for approximately 9.7%, 10.5% and 10.6%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 1,909,651, 2,270,834 and 2,458,863 terminal passengers, respectively, were served by the Culiacán airport. Of the terminal passengers in 2017, 98.5% were domestic, and 1.5% were international. In 2018, 98.7% were domestic, and 1.3% were international. In 2019, 98.5% were domestic, and 1.5% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are highly affected by Mexican economic conditions.

The airport’s terminal passenger traffic consists predominantly of commercial aviation. In 2017, 2018 and 2019, commercial aviation accounted for approximately 98.2%, 99.8% and 99.8%, respectively, and general aviation accounted for approximately 1.8%, 0.2% and 0.2%, respectively, of the airport’s terminal passenger traffic.

A total of seven commercial airlines operate at the airport. In 2019, airlines operating at this airport served eleven domestic destinations: Tijuana, Mexico City, Guadalajara, Monterrey, Mexicali, San José del Cabo, La Paz, Ciudad Juárez, Hermosillo, Chihuahua, Cabo San Lucas and one international destination to Phoenix. In 2019, the domestic airlines operating at this airport were Volaris, VivaAerobus, Aeroméxico Connect, Interjet, Aerocalafia, TAR and Aeroméxico.

The Culiacán airport operates 16 hours a day. The runway has a length of 2,227 meters (7,306 feet) and capacity of 24 air traffic movements per hour. The airport occupies a total area of 280.9 hectares (1.08 square miles). The airport’s facilities include a terminal building expanded in 2012 with a total area of approximately 11,250 square meters (121,094 square feet), including 2,099 square meters (22,593 square feet) of commercial space, a seven‑position apron for commercial aviation, a 57‑position apron for general aviation, six taxiways and two air bridges. The Culiacán airport has a public parking facility that accommodates 343 vehicles.

For the Year Ended December 31,


2016

2017

2018

(in thousands of pesos, except percentages)

Border Destinations







Ciudad Juárez:







Revenues:







Aeronautical services

208,042

244,891

310,892

Non-aeronautical services

34,351

40,676

45,287

Construction services

9,905

31,917

9,096

Total revenues

252,298

317,484

365,275

Operating costs:







Costs and administrative expenses

50,427

48,449

49,809

Major maintenance provision

24,025

31,042

30,915

Construction costs

9,905

31,917

9,096

Depreciation and amortization

10,334

11,104

11,631

Solidarity fee

109,129

137,857

174,273

Total operating costs

203,820

260,369

275,724

Income from operations

48,478

57,115

89,551

Operating margin(1)

19.2
%
18.0
%
24.5
%

Reynosa:







Revenues:







Aeronautical services

113,506

104,311

106,867

Non-aeronautical services

14,150

15,094

14,810

Construction services

23,847

127,353

144,830

Total revenues

151,503

246,758

266,507

Operating costs:







Costs and administrative expenses

24,558

29,074

24,833

Major maintenance provision

19,240

11,471

12,690

Construction costs

23,847

127,353

144,830

Depreciation and amortization

6,290

6,616

7,909

Solidarity fee

52,029

48,363

46,141

Total operating costs

125,964

222,877

236,403

Income from operations

25,539

23,881

30,104

Operating margin(1)

16.9
%
9.7
%
11.3
%

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Durango International Airport

In 2017, 2018 and 2019, the Durango airport accounted for approximately 2.0%, 1.9% and 2.3%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 395,905, 418,914 and 527,004 terminal passengers, respectively, were served by the Durango airport. Of the terminal passengers in 2017, 85.5% were domestic, and 14.5% were international. In 2018, 86.7% were domestic, and 13.3% were international. In 2019, 82.1% were domestic, and 17.9% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of five commercial airlines operate at the airport. In 2019, airlines operating at this airport served nine direct destinations, including six domestic destinations and three international destinations: Mexico City, Tijuana, Monterrey, Guadalajara, Ciudad Juárez, Querétaro, Dallas, Chicago and Los Angeles. In 2019, the domestic airlines operating at this airport were Aeroméxico Connect, Volaris, TAR and VivaAerobus and the principal non Mexican airline was American Airlines.

The Durango airport operates 14 hours a day. The airport’s runway is 2,900 meters (9,514 feet) long. The runway has five taxiways and a capacity of 40 air traffic movements per hour.

The airport’s total area is 541.4 hectares (2.09 square miles). Its facilities include a 3,855 square-meter (41,495 square-foot) terminal building with 272 square meters (2,928 square feet) of commercial space. It has a four‑position commercial aviation apron, a 33‑position general aviation apron and a 343 space public parking area. The airport has three boarding gates for international or domestic flights.

San Luis Potosí International Airport

According to the AFAC, the San Luis Potosí airport was the 30th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, the San Luis Potosí airport accounted for approximately 2.8%, 2.9% and 2.8%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 553,353, 626,512 and 643,224 terminal passengers, respectively, were served by the San Luis Potosí airport. Of the terminal passengers in 2017, 71.6% were domestic, and 28.4% were international. In 2018, 72.0% were domestic, and 28.0% were international. In 2019, 70.6% were domestic, and 29.4% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions. A total of eight commercial airlines operate at the airport: Aeroméxico Connect, Volaris, Aeromar, TAR, VivaAerobus, Magnicharters, American Airlines and United. In 2019, airlines operating at this airport served seven destinations, including five domestic destinations and two international destinations. In 2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Cancún, Tijuana, Monterrey, Puerto Vallarta, Dallas and Houston .

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The San Luis Potosí airport operates 24 hours per day and is located approximately 15 kilometers (9 miles) from the city of San Luis Potosí, which is the capital of the state of San Luis Potosí and has a population of 824,229. The airport has two runways with a total capacity of 20 air traffic movements per hour. The principal runway is 3,006 meters (9,862 feet) long, and the secondary runway is 1,000 meters (3,281 feet) long. The airport has a total area of 508.3 hectares (1.96 square miles). The airport’s facilities include a terminal building with approximately 11,042 square meters (118,855 square feet), including 1,255 square meters (13,509 square feet) of commercial space, a five‑position platform for commercial aviation, two aprons with a total of 24 positions for general aviation, four taxiways, a boarding lounge with five gates and a public parking facility that accommodates 222 vehicles. The airport’s navigational aids include precision approach path indicators, VHF omnidirectional radio and an instrument landing system on runway 14.

In November 2016, we started an expansion and remodeling of the terminal building at the San Luis Potosí airport, which was completed on August 16, 2019. The project had a total investment of Ps.400 million and included an expansion of 8,600 square meters (92,570 square feet), for a total of 13,482 square meters (145,119 square feet). Passenger capacity grew threefold to serve up to 1.2 million passengers per year.

Tampico International Airport

According to the AFAC, the Tampico airport was the 27th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, it accounted for approximately 3.6%, 3.4% and 3.2%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019 a total of 717,342, 736,627 and 739,143 terminal passengers, respectively, were served by the Tampico airport. Of the terminal passengers in 2017, 93.9% were domestic, and 6.1% were international. In 2018, 92.8% were domestic, and 7.2% were international. In 2019, 92.7% were domestic, and 7.3% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of five commercial airlines operate at the airport. In 2019, airlines operating at this airport served nine direct destinations, including eight domestic destinations and one international destination: Mexico City, Monterrey, Cancún, Villahermosa, Guadalajara, Ciudad del Carmen, Veracruz, Querétaro and Houston. In 2019, the domestic airlines operating at the airport were VivaAerobus, Interjet, Aeroméxico Connect and TAR, and the non-Mexican airline was United.

The airport’s total area is 372.5 hectares (1.44 square miles). Its facilities include a 6,833 square-meter (73,550 square-foot) terminal building, of which 826 square meters (8,891 square feet) are commercial spaces. It has a six position apron for commercial aviation, a 17 position apron for general aviation, two taxiways and four boarding gates. The Tampico airport has a public parking facility that accommodates 254 vehicles.

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Torreón International Airport

According to the AFAC, the Torreón airport was the 29th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, the Torreón airport accounted for approximately 3.1%, 3.2% and 3.2%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 618,930, 681,551 and 708,563 terminal passengers, respectively, were served by the Torreón airport. Of the terminal passengers in 2017, 91.2% were domestic, and 8.8% were international. In 2018, 91.3% were domestic, and 8.7% were international. In 2019, 90.0% were domestic, and 10.0% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of seven commercial airlines operate at the airport. In 2019, airlines operating at this airport served seven direct destinations, including six domestic destinations and one international destination. In 2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Guadalajara, Cancún, Tijuana, Querétaro, Ciudad Juárez and Dallas. In 2019, the domestic airlines operating at the airport were Aeroméxico Connect, VivaAerobus, Interjet, Volaris, TAR and Aeroméxico, and the non-Mexican airline was American Airlines.

The airport’s total area is 354.6 hectares (1.37 square miles). Its facilities include a terminal building of 5,447 square meters (5,863 square feet), of which 732 square meters (7,879 square feet) are commercial space, a seven‑position apron for commercial aviation, a seven‑position apron for general aviation, one taxiway, five boarding gates, several VIP lounges and one air bridge. The Torreón airport has a public parking facility that accommodates 142 vehicles.

Zacatecas International Airport

According to the AFAC, the Zacatecas airport was the 35th busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, the Zacatecas airport accounted for approximately 1.8%, 1.7% and 2.1%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 349,453, 366,871 and 475,241 terminal passengers, respectively, were served by the Zacatecas airport. Of the terminal passengers in 2017, 63.3% were domestic, and 36.7% were international. In 2018, 62.4% were domestic, and 37.6% were international. In 2019, 69.0% were domestic, and 31.0% were international. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of four commercial airlines operate at the airport. In 2019, airlines operating at this airport served six direct destinations, including two domestic destinations and four international destinations: Mexico City, Tijuana, Los Angeles, Chicago, San José, California and Dallas.

In 2019, the domestic airlines operating at this airport were Volaris, Aeroméxico Connect and VivaAerobus, and the non-Mexican airline was American Airlines.

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The airport currently operates 24 hours a day. The airport has one runway, which measures 3,000 meters (9,843 feet) in length. The runway capacity is 20 air traffic movements per hour.

The airport’s total area is 207.6 hectares (0.80 square miles). The terminal building is 5,707 square meters (61,430 square feet), of which 491 square meters (5,285 square feet) is commercial area. It has a four‑position apron for commercial aviation, a 14‑position apron for general aviation, three boarding gates and a parking lot with 202 parking spaces.

In 2012, we built a solar park at Zacatecas airport with an installed capacity of 200 Kw in a land area of approximately 4,000 square meters (43,056 square feet), which in 2019 generated approximately 322,455 Kw/h for the airport, equivalent to approximately 37% of the airport’s total electricity requirements.

Border Destinations

Ciudad Juárez International Airport

According to the AFAC, the Ciudad Juárez airport was the 13th busiest airport in Mexico in 2017 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, the Ciudad Juárez airport accounted for approximately 6.0%, 6.3% and 6.9%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 1,173,135, 1,364,028 and 1,597,471 terminal passengers, respectively, were served by the Ciudad Juárez airport. Of the terminal passengers in 2017, 2018 and 2019, 99.8%, 99.7% and 99.6%, respectively, were domestic.

A total of six commercial airlines operate at the airport. In 2019, airlines operating at this airport served 13 direct destinations, all of which were domestic. In 2019, the principal routes to and from this airport, based on passenger traffic, were Mexico City, Guadalajara, Monterrey, El Bajío, Cancún, Tijuana, Culiacán, Hermosillo, Chihuahua, Torreón, Durango, Mazatlán and Querétaro. In 2019, the domestic airlines operating at the airport were VivaAerobus, Volaris, Aeroméxico Connect, Interjet, TAR and Aeroméxico. As of the date of this annual report, the airport does not have any active non-Mexican airlines.

The airport’s total area is 367.95 hectares (1.42 square miles). Its facilities include a terminal building of 6,210 square meters (66,844 square feet), consisting of 964 square meters (10,376 square feet) of commercial space, five boarding gates and two air bridges. The airport has a six‑position commercial aviation apron, a 15‑position general aviation apron, a one‑position freight services apron and three taxiways. The Ciudad Juárez International Airport has a public parking facility that accommodates 300 vehicles.

Reynosa International Airport

According to the AFAC, the Reynosa airport was the 34rd busiest airport in Mexico in 2019 based on commercial and general aviation passenger traffic. In 2017, 2018 and 2019, the Reynosa airport accounted for approximately 2.5%, 2.2% and 2.1%, respectively, of our terminal passenger traffic.

In 2017, 2018 and 2019, a total of 485,727, 466,934 and 480,524 terminal passengers, respectively, were served by the Reynosa airport. Of the terminal passengers in 2017, 2018 and 2019, 99.3%, 99.2% and 99.2%, respectively,

Table of Contents

were domestic. Because the airport’s passengers are predominantly domestic, the airport’s passenger traffic and results of operations are affected by Mexican economic conditions.

A total of two airlines operate at the airport. In 2019, airlines operating at this airport served four direct destinations, all of which are domestic destinations: Mexico City, Cancún, Guadalajara and Veracruz. In 2019, the domestic airlines operating at this airport were VivaAerobus and Aeroméxico Connect.

The Reynosa airport operates 12 hours a day. The airport has one runway, which is 1,893 meters (6,211 feet) in length and has a runway capacity of 18 air traffic movements per hour.

In December 2016, we started construction of a new terminal building at Reynosa airport. The new terminal building is 191% larger than the existing one and will increase the airport terminal’s capacity to approximately one million passengers per year. The project will have a total investment of Ps.325 million, and is expected to start operations in the first half of 2020.

Principal Aeronautical Services Customers

Airline Customers

As of December 31, 2019, over 12 international commercial airlines and nine Mexican commercial airlines operated flights at our 13 airports. VivaAerobus and Grupo Aeroméxico operated the most flights at our airports, followed by Volaris, Interjet and TAR. In 2019, revenues from VivaAerobus were Ps.1,285,954 thousand (U.S.$68.1 million), revenues from Grupo Aeroméxico and its affiliates were Ps.1,255,147 thousand (U.S.$66.5 million), revenues from Volaris totaled Ps.1,177,915 thousand (U.S.$62.4 million) and revenues from Interjet were Ps.761,076 thousand (U.S.$40.3 million), representing 22.4%, 21.8%, 20.5% and 13.2%, respectively, of our aeronautical revenues from airline customers for 2019. These revenues were earned from passenger charges, landing charges, aircraft parking charges and the leasing of space to these airlines.

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The following table sets forth the number of air traffic customers per airline for the years ended December 31, 2017, 2018 and 2019:


	Terminal Passengers
Principal Air Traffic Customers Per Airline	2017	2018	2019
Domestic:
VivaAerobus	4,786,803	5,668,700	6,666,650
Grupo Aeroméxico	5,113,728	5,524,016	5,079,229
Volaris	3,706,882	4,189,679	5,300,929
Interjet	3,096,444	3,137,721	3,045,049
TAR Aerolíneas	381,377	486,151	437,626
Other	641,633	781,732	827,597
Total domestic	17,726,867	19,787,999	21,357,080

International:
American Airlines	504,782	516,367	544,886
United	494,547	494,861	507,277
Delta	260,700	203,812	192,509
Alaska Airlines	124,430	131,119	145,414
Sunwing Airlines	64,648	79,853	85,996
Other	210,128	149,566	165,887
Total international	1,659,235	1,575,578	1,641,969

General aviation	275,912	202,822	169,011
Total	19,662,014	21,566,399	23,168,060

Historically, traditional carriers such as Aeroméxico had represented a substantial majority of the Mexican commercial airline market. In recent years, however, international carriers, discount carriers, low‑cost carriers and other new market entrants have represented a growing proportion of the Mexican commercial airline market. In 2019, passengers traveling on discount and low‑cost carriers, such as VivaAerobus, Interjet and Volaris, accounted for approximately 65.3% of our commercial aviation passenger traffic. Since air transportation historically has been affordable only to the higher income segments of Mexico’s population, resulting in a comparatively low level of air travel, we believe that the entry of low‑cost and discount carriers into the Mexican commercial airline market has helped to increase the use of air transportation in Mexico.

Aeroméxico is a publicly traded company and Delta Airlines currently owns approximately 50.7% of Aeroméxico.

Table of Contents

The following table sets forth our principal air traffic customers for the years ended December 31, 2017, 2018 and 2019:


	Percentage of Aeronautical Revenues
Principal Air Traffic Customers	2017		2018		2019
Domestic:
Grupo Aeroméxico (Aeroméxico and Aeroméxico Connect)	24.2	%	24.5	%	24.5	%
VivaAerobus	19.4	%	21.2	%	21.2	%
Volaris	16.7	%	17.5	%	17.5	%
Interjet	14.8	%	14.2	%	14.2	%
TAR	1.7	%	2.1	%	2.1	%
Grupo Aeromonterrey (Magnicharters)	1.8	%	1.9	%	1.9	%
Aeromar	0.8	%	0.8	%	0.8	%
Calafia Airlines	0.5	%	0.5	%	0.5	%
DHL Express México	0.3	%	0.3	%	0.3	%
Other	4.8	%	4.1	%	4.1	%
Total domestic	85.0	%	87.1	%	87.1	%

International:
American Airlines	4.8	%	4.3	%	4.3	%
United	4.7	%	4.1	%	4.1	%
Delta	2.1	%	1.4	%	1.4	%
Alaska Airlines	1.1	%	1.1	%	1.1	%
Copa Airlines	0.3	%	0.3	%	0.3	%
Charters	1.5	%	1.3	%	1.3	%
Other	0.5	%	0.4	%	0.4	%
Total international	15.0	%	12.9	%	12.9	%
Total	100.0	%	100.0	%	100.0	%

Complementary Services Customers

As of December 31, 2019, our principal complementary services clients are three principal providers of ramp‑handling and baggage‑handling services, AGN Aviation Services, S.A. de C.V., Menzies Aviation Mexico, S.A. de C.V. and Administradora Especializada en Negocios, S.A. de C.V., and our primary catering client is Aero Cocina, S.A. de C.V., all of which provided an aggregate of Ps.28,627 thousand of revenues in the form of access fees in 2019.

Principal Non-Aeronautical Services Customers

As of December 31, 2019, we were party to approximately 1,301 contracts with providers of commercial services in the commercial space in our airports, including retail store operators, duty free store operators, food and beverage providers, financial services providers, car rental companies, telecommunications providers, VIP lounges, advertising, travel agencies, time‑share sales and promotions services and tourist information and promotion services. As a result, our revenues from non‑aeronautical services commercial customers are spread across a large number of customers and are, therefore, not dependent on a limited number of principal customers. In 2019, our largest commercial customers were ISA Corporativo S. A. de C. V. (advertising), Alquiladora de Vehículos Automotores, S.A. de C.V. (car rental), Aerocomidas, S.A. de C.V. (food and beverage), DMC Transportación Ejecutiva, S. de R.L. de C. V. (VIP lounges), Operadora Aeroboutiques, S.A. de C.V. (duty paid stores), a subsidiary of Grupo Areas, Dufry México, S.A. de C.V. (duty free) and Comercial Ariete, S.A. de C.V. (car rental).

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Seasonality

Competition

Excluding our airports servicing tourist destinations, our airports currently are the only major airports in the geographic areas that they serve and generally do not face significant competition.

The Mexican Airport and Auxiliary Services Agency currently operates 12 small airports in Mexico’s northern region, which collectively served 2,434,329 passengers in 2019, representing an increase of 14.1% from 2018 traffic, mainly as a result of an increase in passenger traffic to and from Querétaro, Tepic and Colima.

In the future, we may face competition from Aeropuerto del Norte, an airport near Monterrey operated by a third party pursuant to a concession. The state of Nuevo León has requested in the past that the Ministry of Communications and Transportation amend Aeropuerto del Norte’s concession to allow it to serve commercial aviation operations, but to date the Ministry of Communications and Transportation has not amended Aeropuerto del Norte’s concession. In addition, we understand that Aeropuerto del Norte is not capable of accommodating commercial passenger traffic with its current infrastructure.

Sustainability and Our Corporate Culture

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Awards and Recognition

In 2018, OMA was included in the Dow Jones Sustainability Index (“DJSI”) Emerging Markets for the third consecutive year. In addition, OMA was included in 2019 in the Dow Jones Sustainability Index-MILA, for the second consecutive year. The current DJSI-MILA is valid through Spetember 2020.

In, 2018, we were included in the Sustainability Index of the Mexican Stock Exchange (Índice Sustentable de la Bolsa Mexicana de Valores) for the seventh year in a row.

In 2013 and 2014, respectively, the Acapulco airport and the Ciudad Juárez airport received the Environmental Quality Certificate (Certificado de Calidad Ambiental) issued by the Federal Office for the Protection of the Environment (Procuraduría Federal de Protección al Ambiente) for compliance with applicable Mexican environmental laws, regulations and applicable Official Mexican Standards and must be renewed on a biannual basis. In 2014, this certificate was renewed for the Ciudad Juárez and Chihuahua airports, in 2015 the Acapulco, Culiacán, Mazatlán and Zihuatanejo airports received new Environmental Quality Certificates valid for two years, and in 2016 the certificate was renewed for the Chihuahua airport and a new certificate was granted for the Tampico airport. In 2017, the Mazatlán, Ciudad Juárez, Culiacán, Chihuahua, Tampico, Acapulco, Reynosa and Zihuatanejo airports kept current Environmental Quality Certificates. In 2019, all our airports, excluding Monterrey, maintained the certification, and the Monterrey airport is expected to receive its certificate in 2020. In addition, in 2018 the Federal Office for the Protection of the Environment (Procuraduría Federal de Protección al Ambiente) granted OMA the Environmental Commitment Recognition for the implementation of innovative business strategies to preserve and improve the environment while contributing to sustainable development.

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development of tourism projects and its commitment to global sustainability criteria. In 2019, the Acapulco, Ciudad Juárez, Chihuahua, Durango and San Luis Potosí airports also received such Distinctive “S” (Distintivo “S”).