SM Prime nets P6.6B

SM Prime Holdings

Southeast Asian property giant SM Prime Holdings Inc. reported a 13 percent growth in first quarter net income to P6.6 billion on higher earnings from shopping mall and residential development.

SM Prime recorded consolidated revenues of P20.51 billion for the first three months, an increase of 12 percent.

“Our strong performance in the first quarter gives us high confidence that we are on track to meet our growth targets in terms of revenues and income for the full year. As we continue our strategic rollout of projects across our properties, we are optimistic that our growth will be sustained by the overall expansion of the Philippine economy,” SM Prime president Jeffrey Lim said in a press statement on Friday.

Rental revenues rose by 12 percent year-on-year to P12.07 billion, with the opening of new malls and expansion of some of its mature malls in the last two years. These included SM Seaside City Cebu, SM City East Ortigas, SM City San Mateo, SM City Cabanatuan, SM City San Jose Del Monte, SM City Trece Martires, SM City Iloilo expansion, S Maison in SM Mall of Asia and SM Center Molino Expansion

The opening of new malls and the expanded areas added a total gross floor area of 1.1 million square meters to total portfolio.

Of total rental revenues, 88 percent was contributed by the malls and the rest from office and hotels and convention centers. Excluding the new malls and expansions, same-store rental growth stood at 7 percent.

Room rentals from hotels and convention centers contributed to the increase due to the opening of Conrad Manila in June 2016 and the improvement in average room rates and occupancy rates.

SM Prime also recorded a 7 percent increase in real estate sales in the first quarter to P5.92 billion primarily due to higher construction accomplishments of projects launched in 2014 up to 2015.