Mexican airport owner Grupo Aeroportuario del Sureste (NYSE:ASR), or ASUR, reported fourth-quarter results on Monday morning. The company enjoyed strong passenger traffic growth, especially at its key Cancun airport. Nonetheless, the company's earnings per share fell by just over 20% due to foreign exchange losses. Let's fly in a little closer to see what happened during the quarter.

Traffic flies higher
Overall passenger traffic was up 14.1% from the fourth quarter of the previous year as passenger growth was strong both domestically and internationally. Domestic passenger traffic rose 14.2% on solid growth at each of the company's nine airports. Growth was strongest at Cozumel and Huatulco, up 31.3% and 41.1%, respectively. Growth at Cancun, which is by far ASUR's largest airport at 50% of domestic traffic, was up 13.1% during the quarter.

Cancun represents 94% of the company's international passenger traffic. While international traffic growth rose by 14.6% at the airport, weak increases across most of the rest of ASUR's airports pulled down overall international passenger traffic growth to 13.9%.

Revenue ramps up, but a weak peso eats into profit
ASUR's increased passenger traffic helped boost revenue by 14%. The company enjoyed strong revenue growth from all three of its segments: aeronautical services revenue was up 12.9%, nonaeronautical services rose by 14.5%, and construction services revenue spiked 16.1%.

The highlight was nonaeronautical services, which enjoyed solid growth across several operations. Quarterly revenue rose 28% from both parking lot fees and banking and currency exchange services, while car rental revenue and food and beverage both enjoyed a 20% jump in revenue.

ASUR translated that revenue growth into improved profitability by keeping expenses in check: total operating costs and expenses only increased 8.1%, thanks in part to an 8% drop in administrative expenses. This helped push the company's operating margin up from 44.4% in the year-ago quarter to 47.2% in the reported quarter.

Unfortunately, all this good news could not overcome weakness in the Mexican peso, which depreciated by 9.7% against the U.S. dollar. ASUR recorded a foreign exchange loss of 126.96 million pesos in the quarter, which is a big reversal of the 13.5 million peso foreign exchange gain the company recorded in the fourth quarter of 2013. This loss caused net income to drop 20% to 513.23 million pesos and earnings per share to drop to 17.108 pesos, or $1.16.

Investor takeaway
ASUR delivered a solid quarter. Passenger traffic, revenue, and operating profit all enjoyed double-digit growth. Unfortunately, the strong dollar took a big slice out of the company's earnings.