Grupo Aeroportuario del Sureste (ADR) (NYSE:ASR), or ASUR, announced third-quarter results just before the opening bell this morning. The Mexican airport operator reported earnings of $1.44 per share, which was three pennies above analysts' estimates and up 13.8% from last year's results based on constant currency rates. Higher traffic at its airports along with slightly higher revenue per passenger led to the better than expected results. Let's fly in a little closer and take a look at the numbers that drove results this quarter.

Higher traffic drives results
Total passenger traffic was up 8.94% over the third quarter of last year. Leading the strong traffic gains was the company's crown jewel Cancun airport. The airport enjoyed a 9.94% surge in international passenger traffic along with a 5.41% boost in domestic passenger traffic, which is crucial as 75% of the company's passenger traffic passes through this one airport.

The overall increase in passenger traffic along with a slight 0.27% increase in commercial revenue per passenger helped push total revenue up 12.22% over last year along with boosting operating profit by 9.42%. The 12.22% jump in revenue, however, is a bit misleading as a 48.69% jump in construction services revenue inflated revenue a bit. That revenue is later offset by higher capital expenses.

The more important numbers are the aeronautical services and nonaeronautical services revenue, which were up 8.57% and 9.16%, respectively, as a result of higher traffic. Leading the way here was commercial revenue, which was up 9.19%, with food and beverage revenue popping 33.61% and parking lot fees increasing by 25.08%. If there was one area of weakness it was the company's duty-free revenue, which fell by 3.09% year over year. Overall, the increase in revenue from higher traffic drove gains to the bottom line, leading to the 9.42% boost in operating profit and stronger overall earnings. 

Investment pays off
The other big contribution to ASUR's higher than expected profitability came from its investment in Aerostar, which is a 50% joint venture that owns the Luis Munoz Marin International Airport in Puerto Rico. ASUR's equity in the earnings of Aerostar resulted in a net gain of Ps.21.31 million, which is up from the net gain of Ps.0.33 million in the third quarter of last year. On top of that the company reported a Ps.51.24 million gain in stockholders' equity, which is up from Ps.16.52 last year. While traffic at the airport was up 3.7%, the gain wasn't really driven by the traffic increase as it was largely due to the depreciation of the peso against the U.S. dollar.

Overall, ASUR reported a strong quarter. Not only was passenger traffic up, but the company's revenue per passenger increased as well as it was able to leverage its traffic gains. This is exactly what investors want to see from the company.

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