SM Prime posts 15% jump in 2011 net profit to P9.1B

SHOPPING mall giant SM Prime Holdings Inc. grew its net profit last year by 15 percent to P9.1 billion on sustained growth in rental revenues and expanded capacity from new malls.

In a disclosure to the Philippine Stock Exchange Friday, the country’s largest shopping mall developer said total revenues for the year rose 13 percent to P26.9 billion. Cash flow as measured by earnings before interest, taxes, depreciation and amortization (Ebitda) jumped 16 percent to P18.5 billion for an Ebitda margin of 69 percent.

The results included the operations of four SM malls in China, which are located in the cities of Xiamen and Jinjiang in southern China, Chengdu in central China, and Suzhou in eastern China, the disclosure said.

SM Prime, led by the family of tycoon Henry Sy, attributed the results to a mix of expanded capacity from new malls in the Philippines that opened in 2010 and 2011 and the same-store rental growth of 7 percent. In addition, SM Prime said its four shopping malls in China sustained their robust growth, with net income doubling to P889 million last year from a year ago.

A tighter grip on operating expenses through the use of innovative energy conservation methods likewise contributed to the company’s rise in profits, the disclosure said.

“SM Prime’s noteworthy performance in 2011, which was achieved in spite of tempered economic progress, clearly shows that the business formula the company has adopted is resilient and built for sustainable growth. Now that there is better optimism on the country’s prospects, the company is even more eager to pursue its growth and expansion plans, as a fitting tribute to all our stakeholders, who we sincerely thank for loyally supporting us all through these years,” SM Prime president Hans Sy said.

For the full year, SM Prime’s consolidated rental revenues contributed 85 percent to the total and grew 14 percent to P22.8 billion. New rental space came from SM City malls in Tarlac, San Pablo, Calamba, Novaliches and Masinag. Combined, the new malls added 380,000 square meters to the company’s total gross floor area and presently registers an average occupancy rate of 97 percent.

Cinema ticket sales likewise increased by 10 percent due to popular movies shown during the period. The major blockbusters were “Transformers 3: Dark of the Moon,” “Praybeyt Benjamin,” “Harry Potter and the Deathly Hallows Part 2,” “No Other Woman” and “Twilight Saga: Breaking Dawn Part 1.”