SM Prime earnings hit P16.2B in 2013
MANILA, Philippines—The SM group’s real estate businesses under SM Prime Holdings chalked up a net profit of P16.27 billion in 2013, the first year of consolidation.
This net profit level was only slightly changed versus the restated P16.2 billion consolidated net profit of the real estate group in 2012.
In a statement, SMPH said its 2013 net income would have increased by 8 percent to P17.55 billion were it not for the one-time restructuring cost of P1.28 billion.
This was the first time the holding firm reported the consolidated financial position.
The SM group last year consolidated businesses under SM Development Corp., Highlands Prime and other privately held assets under SM Land.
Consolidated revenues rose by 5 percent to P59.79 billion, the bulk of which was from rental revenues which accounted for 54 percent. Rental revenues grew by 11 percent to P32.20 billion.
Article continues after this advertisementThe increase in profits was primarily due to the full-year effect of new malls opened in 2012, namely SM City Olongapo, SM City Consolacion, SM City San Fernando, SM City General Santos, SM Lanang Premier, and the opening in 2013 of SM Aura Premier.
Article continues after this advertisementExcluding the new malls and expansions, rental revenues grew by 7 percent.
SM Prime’s shopping malls in China also sustained their profit growth, contributing about P958 million.
Cinema ticket sales increased by 8 percent to P3.74 billion as SM Prime opened additional digital cinemas at the new malls. Amusement and other revenues likewise increased by 40 percent to P3.08 billion with the opening of new amusement rides at SM by the Bay and the SkyRanch in Tagaytay, as well as the increase in advertising income and sponsorship revenues.
The full-year recognition of revenues from Two-Ecom, which began operations in mid-2012 and is now 98-percent occupied, also helped push up rental revenues from commercial operations by 14 percent to P2.93 billion.
On the residential business, real estate sales for 2013 stood at P20.78 billion, down from the P22.57 billion restated level in the previous year.
Three projects were launched in 2013, namely: Grass phase 2, Shore and Trees, which are expected to contribute significantly to revenues starting in 2014. Gross margins improved to 42 percent versus 37 percent in 2012.
