SMIC rides on robust PH growth as profit hits P22B
SM Investments Corp. (SMIC), the country’s largest conglomerate, booked an 11-percent growth in nine-month net profit to P22 billion as the fast growing economy boosted earnings across its retail, banking and property businesses.
Excluding one-off items, core profit rose by 9 percent year-on-year at the end of September, matching the 9 percent rise in consolidated revenues to P252.4 billion also for the period.
“Our core businesses are delivering solid growth in line with the investments we have made and against a background of stable economic fundamentals. We are also encouraged by the performance of the recently merged specialty retail stores that delivered double-digit topline growth,” SM president Harley Sy said in a press statement on Wednesday.
SMIC is considered a key barometer of the domestic economy, which expanded by 6.9 percent year-on-year as of the first semester.
“The intention of the government program to invest heavily in nationwide infrastructure projects should help economic development and drive provincial growth outside Metro Manila, which is where we are also directing our investments,” Sy said.
SMIC’s growth was led by the 13-percent expansion in its property business under SM Prime Holdings, the 11 percent growth in profits contributed by banking units BDO Unibank and China Bank and the 7 percent growth posted by the retail business.
For the nine months in review, banks and property each accounted for 39 percent of consolidated earnings while retailing contributed 22 percent.
Retail operations under SM Retail Inc. grew a nine-month net profit by 7 percent year-on-year to P7 billion on the back of a 9-percent expansion in total sales to P186 billion.
By end-September, the total gross selling area of SMIC’s 55 department stores stood at 700,000 square meters.
The food retail group also pursued its aggressive expansion in both urban and rural communities nationwide, adding 15 mid-sized Savemore stores, two SM Supermarkets, one SM Hypermarket and three WalterMart stores, for a total of 277 stores. Alfamart increased its number of stores to 187 stores as of end-September from 99 at the start of the year.
Early in the year, SM announced the merger of SM Retail with several leading specialty retail stores with over 1,400 outlets. The merger received final approval from the Securities and Exchange Commission in July. During the nine-month period, the specialty stores added 95 branches nationwide.
BDO Unibank also grew its net income by 10 percent to P19.3 billion on robust lending, deposit-taking and fee-based businesses.
China Bank, on the other hand, grew its net profit by 31 percent to P4.8 billion on strong growth in its core and fee-based businesses.
Property unit SM Prime, now a leading property developer in Southeast Asia, also reported a 13 percent growth in recurring net income to P17.5 billion for the nine-month period. —Doris Dumlao-Abadilla
