In the first quarter you saw the 12% increase which is reducing from these 20s that we saw last year. The 2023 increase in Puerto Rico was 18%. So the normalization would be towards the second and third quarter to see a more normal growth in the case of Puerto Rico. In terms of commercial revenues, I have to say that today we’re still struggling in the case of Mexico because two things. One has to do with exchange rates of course and the other one has to do with the lack of expansion. So commercial revenues from an operational perspective will continue to suffer this situation in the case of Cancun, Benziti [ph] Terminal 2 until we are able to expand the area that should occur at the end of 2025.
Fernanda Recchia: Thank you very much.
Adolfo Castro: You’re welcome.
Operator: Our next question is from Jay Singh with Citi. Please proceed.
Jay Singh: Hey, thanks for taking my question. Jay Dalligan from Stephen Trent’s team. The first question I want to ask was it only in January you reduced the technical assistance fees or do you sort of do it in the subsequent quarter?
Adolfo Castro: You said January 1.
Jay Singh: Where you reduced the technical assistance fee?
Adolfo Castro: The technical assistance reduction is as from the first year and it will be 2.5 [Indiscernible], five years.
Jay Singh: Thanks. And my next question is that I know you already spoke a bit about Mexico City Airport area, but do you have any further comments on competition from Tulum?
Adolfo Castro: Well, in the case of Tulum what we know roughly speaking is the numbers that have been published by the government are around 40,000, 41,000, 42,000 for the months of December, January, February. There’s more than 3 million in the case of Cancun.
Jay Singh: Thanks a lot.
Operator: Our next question is from Joao Frizo with Goldman Sachs. Please proceed.
Joao Frizo: Hello, good morning. Thanks for taking my questions. I have two quick follow-ups. The first one is on the third side, right? So if you could please help us reconcile what drove the increase quarter-on-quarter on passenger revenues in the first quarter, right? We saw a sharp increase. As you mentioned, you did not adjust for the MDP until April, so this is not the driver. So maybe what these functions are for reducing the discounts you guys offered in the fourth quarter last year or maybe something else if you could just help us reconcile that would be great. And my second follow-up is on Cancun Airport. Could you please just remind us what the expected capacity would be once expansion is completed? Thank you very much.
Adolfo Castro: Well, in the case of the tariff, you mentioned one of the effects we compared tariff from the fourth quarter when the first quarter is here. Well, first of all, we didn’t adjust the tariff during the first quarter, so we are counting exactly the same as we were during the fourth quarter last year. Let me put that very clear. Of course, as you have mentioned, during the months of November and December, we had to give a 10% discount on the passenger fee both international and domestic. But the other effect, and that’s what I mentioned in the initial remarks, is the proportion of domestic and international. For this quarter, you can see the difference between 6.8 million in international versus 6.2 in last year. International traffic pays more due to the additional space you have to provide for customs and migration, and that is why you probably are seeing an increase.
But the intent of the tariff of the specific products, there was no increase for the quantity. In terms of the capacity of Cancun, what we are going to increase is, as I have mentioned, we are going to reconstruct and expand Terminal 1. Terminal 1 should be more than 3 to 4 million passengers on a yearly basis. Of course, the capacity has to do with the level of service. In the case of Terminal 4, we are in the process of expanding 4 additional boarding gates. That would be more than 3 million in addition. And finally, towards the end of the 5-year period, we will add another 8 to 10 aircraft stands, also in Terminal 4. And that should be more than 5 million to 6 million additional passengers on a yearly basis capacity.
Joao Frizo: Super, thank you very much.
Adolfo Castro: You’re welcome.
Operator: Our next question is from Pablo Ricalde [ph] with Santander. Please proceed.
Unidentified Analyst: Hi, Adolfo. A follow-up on Mexico non-air revenues. That international contribution within the past few years, how should we think in that regard in terms of UASB? Do you increase that year-over-year in UASB terms?
Adolfo Castro: In terms of international traffic, well, first of all, maximum rates are stated in Mexican pesos. So, the effect of the international versus domestic, at the end, if we reach close to the 100, there is no difference. But the point is, during the quarter compared with the quarter last year, international paid more pesos in comparison with the domestic. And that’s why we were able to see a better regulated traffic capacity.
Unidentified Analyst: Okay. So, but is that to be only in UASB terms because we saw a short Mexico to MXN year-over-year? And besides that, revenues grew almost 20% in that context.
Adolfo Castro: Well, in that sense, again, if we see a domestic traffic decrease during the year that could be offset by international traffic. That will help, of course, from this perspective. And that’s why I was saying also the effect, the exchange rate Mexico versus dollar will be extremely important for the year.
Unidentified Analyst: Okay.
Operator: Our next question is from Gabriel Himelfarb with Scotiabank. Please proceed.
Gabriel Himelfarb: Hi, Adolfo. Congrats on the results. Just a quick follow-up question in terms of new investments. Are you seeing any new investments perhaps outside Mexico, maybe in the U.S. or in the Caribbean? Thank you.
Adolfo Castro: For the moment, we do not have any project in front.
Gabriel Himelfarb: Okay. Thank you. Congrats on the results.
Operator: Our next question is from Arthur Suelotto with APO Capital. Please proceed.
