LUXEMBOURG - Corporación América Airports S.A. (NYSE: CAAP), a prominent private airport operator, has been awarded $91.2 million in damages by the International Centre for Settlement of Investment Disputes (ICSID) in an arbitration against the Government of Peru. The dispute arose following Peru's termination of a concession contract for the Chinchero International Airport.
On May 9, 2024, the ICSID tribunal notified Kuntur Wasi, a joint venture in which CAAP holds a 50% stake, of its decision in the case. The tribunal found that Peru had breached the concession agreement by ending it without a justified public interest reason.
Consequently, Peru is ordered to pay Kuntur Wasi $91,205,056, which includes interest accumulated up to February 28, 2024. The award also stipulates that any additional interest will continue to accrue at the rate established in the award until the date of payment, compounded annually.
The arbitration procedure was initiated by Sociedad Aeroportuaria Kuntur Wasi S.A. in June 2018 with ICSID, also known as CIADI in Spanish, following the Peruvian government's unilateral decision to terminate the concession agreement.
Corporación América Airports operates 52 airports across six countries in Latin America and Europe, including Argentina, Brazil, Uruguay, Ecuador, Armenia, and Italy. In 2023, the company served 81.1 million passengers, which was a significant increase from the 65.6 million passengers in 2022, though slightly below the 84.2 million passengers in 2019. CAAP is publicly traded on the New York Stock Exchange.
The company has stated that it will provide further updates on the matter as appropriate. This development is based on a press release statement from Corporación América Airports.
InvestingPro Insights
Corporación América Airports S.A. (NYSE: CAAP) has recently made headlines with its arbitration victory, and investors are keenly observing the company's financial health and stock performance. According to InvestingPro data, CAAP has a market capitalization of $2.88 billion and is trading at a P/E ratio of 12.02.
This valuation is particularly noteworthy given that the company is also trading near its 52-week high, with the stock price at 98.46% of this peak. The company's strong financial performance is further underscored by its gross profit margin of 34.68% over the last twelve months as of Q4 2023.
Two InvestingPro Tips highlight CAAP's investment potential. Firstly, the company has a perfect Piotroski Score of 9, indicating a very healthy financial state. Secondly, CAAP is trading at a low P/E ratio relative to near-term earnings growth, which could signal an attractive investment opportunity for value investors. Moreover, the company has experienced a substantial price uptick over the last six months, with a 53.43% total return, which complements the high return of 56.38% over the last year.
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