SM Prime profit hits P14.39B as malls sprout outside NCR
Sy family-led property giant SM Prime Holdings grew its first semester net profit by 14 percent year-on-year to P14.39 billion on higher earnings from its shopping mall and residential development businesses.
For the second quarter alone, SM Prime’s net profit rose by 15 percent year-on-year to P7.79 billion, the company said in a regulatory filing.
Six-month consolidated revenues grew by 10 percent to P43.25 billion while overall operating income went up by 13 percent to P20.11 billion.
“SM Prime’s performance in the first half of the year reflects a more balanced revenue and
income streams from our various businesses including the growing contribution from our provincial operations,” SM Prime president Jeffrey Lim said.
“We are happy to report that our investments in the provinces are now bearing fruits, particularly in mall operations given that these account for more than half of our Philippine malls portfolio. In the coming years, we are expecting a growing contribution from our residential group as we are launching more housing projects across the country.”
Mall revenues, which contributed 60 percent to SM Prime’s consolidated revenues, rose by 10 percent in the first half to P25.68 billion on higher rental in its expanding network.
Mall rentals improved by 10 percent to P21.75 billion in the same period, boosted by the additional 1.1 million square meters (sq m) gross floor area (GFA) of retail space from new malls and expansions between 2015 and 2017. Excluding the contribution from new malls, same mall sales growth was at 7 percent.
Cinema and event ticket sales were almost flat at P2.35 billion due to fewer blockbuster movies. Revenues from amusement and merchandise sales amounted to P1.58 billion, up by 26 percent.
Consolidated mall operating income increased by 10 percent to P14.18 billion while operating margins were stable at 55 percent.
To date, SM Prime has 63 shopping malls in the Philippines and seven in China with a GFA of 7.8 million sq m and 1.3 million sq m, respectively. The company is scheduled to open more malls.
The residential group, which accounted for 32 percent of SM Prime’s consolidated revenues, posted a 5-percent increase in six-month revenues to P13.91 billion as SM Development Corp. accomplished more projects since 2014.
