SM Prime nets P7.6B

SM Prime prexy Jeffrey Lim and chair Henry Sy Jr.

Property giant SM Prime Holdings grew its net profit in the first quarter by 15 percent year-on-year to P7.6 billion on a double-digit growth in revenues from shopping mall and residential development.

Driven by the expansion of its mall and residential businesses in key cities all over the country, SM Prime’s consolidated revenues reached P23.4 billion in the first three months, higher by 14 percent from the same period last year.

“The growing revenue contribution of our mall operations in the provinces and increasing reservation sales of our residential projects in Metro Manila drove our bottom line higher and kept us in line with our first quarter target in 2018. Nevertheless, we plan to continue expanding in key cities all over the Philippines to sustain our growth targets over the next few years,” said SM Prime president Jeffrey Lim said in a press statement.

SM Prime posted a 10-percent revenue growth in its malls business to P13.9 billion, accounting for 59 percent of total business.

The new malls that opened in 2016 and 2017 helped improve the mall rental revenues, delivering P11.9 billion, 12 percent higher from last year’s PHP10.7 billion. These malls include SM City San Jose Del Monte in Bulacan, SM City Trece Martires in Cavite, SM Cherry Congressional in Quezon City, SM City East Ortigas in Pasig City , SM CDO Downtown Premier in Cagayan de Oro, S Maison in Pasay City, SM Cherry Antipolo in Rizal, SM City Puerto Princesa in Palawan, SM Center Tuguegarao Downtown in Cagayan, SM Center Pulilan in Bulacan and SM Center Lemery in Batangas.

SM Prime’s malls operating income increased by 11 percent to P7.8 billion while operating margin was steady at 56 percent. Excluding the impact of newly opened malls, same-mall- sales grew by 7 percent year-on-year for the first three months of the year.

On the other hand, cinema and event ticket sales declined by 9 percent to P1.11 billion due to less-than-stellar international blockbuster movies shown compared to 2017.

Meanwhile, SM Prime’s residential group, led by SM Development Corp. (SMDC), posted a revenue growth of 25 percent in the first quarter to P7.5 billion. This unit reported a double-digit growth in residential real estate sales due to more projects being turned over from 2015 to 2017.

As an indicator of future growth, SMDC’s reservation sales grew by 20 percent in terms of sales value to P14.8 billion in the first quarter. In terms of unit sales, it was almost flat at 3,894. SM Prime is in line with its target to launch 12,000 to 15,000 residential units this year.