SM Investments increasing capital to P12b to fund infra

Manila Standard Today (March 2013) - Conglomerate SM Investments Corp. is increasing its capital base to P12 billion from P7 billion to support ventures in the infrastructure sector and finance expansion projects.

SM Investments said in a filing with the Philippine Stock Exchange it would submit the proposed capital increase to its board of directors and stockholders for approval.

SM Investments chief finance officer Jose Sio confirmed in a text message the  capital hike would support company’s investments in infrastructure projects as well as expansion projects.

SM Investments was one of the companies that acquired bid documents for the P17.5 billion, Mactan-Cebu International Airport project. The conglomerate also teamed up with Metro Pacific Investments Corp. to build a P15.5-billion expressway project that will link the terminals of the Ninoy Aquino International Airport with each other and to the government-sponsored Pagcor Entertainment City.

SM Investments’ operating units are on the expansion mode. Its shopping mall unit SM Prime plans to launch SM Aura Premier in Taguig and SM City Cauayan in Isabela this year.

SM Retail is opening two department stores, two supermarkets, 19 SaveMore branches and seven hypermarkets.

The group’s residential unit, SM Development Corp., plans to launch at least three new projects in Metro Manila.

SM Hotels is set to open Park Inn hotel in Davao this quarter while subsidiary SMX Manila will launch SMX Convention Center in Taguig next month.

SM Investments earlier reported a net income of P24.7 billion in 2012, up 16.3 percent from P21.2 billion in 2011.

Consolidated revenues increased 12 percent to P223.9 billion from P199.9 billion in the previous year.
Banking unit BDO Unibank Inc. accounted for the largest share of SM Investments’ consolidated net income, contributing 34.4 percent of the total. Retail operations accounted for 28.1 percent, followed by mall operations at 22.9 percent and property development at 14.6 percent.

The group has earmarked P65 billion for capital expenditures this year.

For more details on SMDC Residential Projects, you may contact Reby Ramirez: 0922.883.9308 / 0916.4044.555 / 0919699.3572 or reby_ramirez@yahoo.com.

For latest information on the Philippine Real Estate Industry and the Real Estate Service Act (RA9646), please visit www.ra9646.com.ph.   

SM Prime opens 5th mall in China

Malaya - SM Prime Holdings, Inc., the country’s largest mall developer and operator recently opened SM City Chongqing, its fifth mall in China.  Located in Southwest China, it is the country’s fifth shopping mall in China after SM City Xiamen, SM City Jinjiang, SM City Chengdu, and SM City Suzhou.

Known as the Chicago of the East, Chongqing is one of the four municipalities directly under the Central Government of China after Beijing, Shanghai, Tianjin, and Guangzhou.

An economic center upstream of the Yangtze River, Chongqing’s three thousand years of history highlights the broad and deep Bashu culture, where the root of prosperity is rooted.

Today, Chongqing has several economic and technological zones and is a major railway hub.  The city also boasts of cultural heritage and natural attractions, and is the starting point of the Yangtze River Cruise, which explores the impressive scenery of China’s Three Gorges.

The 149,080 square meter six -level mall is located in Chongqing’s rapidly developing Yubei district.  With its strategic location and transport accessibility, the mall will serve a population of approximately 30 million residents in the city of Chongqing.

SM City Chongqing’s exterior design features “fish scale” panels accented by lighting a “fish scale” overlaps.  Slanted glass panels define entrances at the lobby, giving customers a grand welcome.

Customers get a grand welcome as they enter as beige tones create a warm, cordial, and clean feeling.  Huge skylights not only give customers a sense of awe, but also providing the mall with natural lighting, making it environmentally friendly.

Navigating around the mall is easy, as the planning of retail shops focuses on the circulation flow.  A dazzling array of beautiful exhibits of goods can be seen through either sides of the mall lobby to enhance the shopping experience.

With 85% of the mall awarded to various tenants, SM City Chongqing offers a mix of local and international stores with Vanguard Supermarket, SM Department Store, and Wanda Cinema as its anchor tenants.  Junior anchors include Vera Moda, Ongly, Jack & Jones, Watsons, Starbucks, and Kidswant.

SM City Chongqing is the sixth SM mall to be opened by SM Prime this year after SM City Olongapo in Zambales. SM City Consolacion in Cebu, SM San Fernando in Pampanga, SM City General Santos in Cotobato, and SM Lanang Premier in Davao.

SM Prime now has a total of 51 malls in the Philippines and in China with a combined GFA of 6.3 square meters.


For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.ph.

SM Investments planning entertainment center in Tagaytay

Businessworld -- Sy-led SM Investments Corp. aims to further grow its property footprint in Tagaytay City with a new “entertainment center,” a senior official of the company said over the weekend.

“Adjacent to this land, you can see some development. It is a six-hectare development attached to this lot, to be called Tagaytay Sky Ranch,” Jose T. Sio, SM Investments executive vice-president and chief finance officer, said in an interview on the sidelines of the Media Nation 9 conference at Taal Vista Hotel, Tagaytay City last Saturday, when asked about the company’s plans in the area.

“It will be composed of horse-riding [facilities] and other components like a gazebo, gardens, a Ferris wheel, a few commercial spaces and restaurants. It will be an entertainment center, almost a city by itself.

We’re going to have a soft opening by December,” Mr. Sio said.

Tagaytay City, a 6,500-hectare, second-class city in the province of Cavite, has long been positioned as “one of the major tourist destinations in the country,” according to its official Web site. Tourist attractions include historical landmarks, the Japanese Garden, Tagaytay Highlands, People’s Park in the Sky, as well as Picnic Grove and Livelihood Complex.

SM Investments currently has three developments in Tagaytay City:

Wind Residences, a residential condominium under SM Development Corp.; Tagaytay Highlands, an upscale mountainside residential resort under Highlands Prime, Inc.; and Taal Vista Hotel, formerly known as Taal Vista Lodge, under SM Hotels and Conventions Corp.
Mr. Sio described the planned Tagaytay Sky Ranch, which will be managed by SM Hotels and Convention upon its completion, as a potential tourism attraction.

“We will be complementing Tagaytay Picnic Grove… This is a place that you simply cannot replace as it is overlooking Taal Volcano,” Mr. Sio said.

At the same time, Mr. Sio said that there was still room for expansion at Taal Vista Hotel, whose last renovation in 2008 saw rooms double to 261 from 128, and the addition of a 1,000-seater ballroom.

“We still have space for development here,” Mr. Sio said without elaborating.

SM Investments remains bullish in its outlook for the next three years due to a growing economy.

“It’s ‘all go’ for next three years. It’s all growth -- it will be all positive for the malls, retail, banking, the property and hotel [units].

Everything will be a go, and I think this is what we also feel about the Philippine economy,” Mr. Sio said.

SM Investments, which plans a record P65-billion capital expenditure next year, grew its net income by 14% to P16.1 billion as of September from the P14.2 billion earned in the same nine months last year.

Shares of SM Investments rose by P1.50 or 0.18% to P837.50 apiece yesterday from P836.00 on Friday last week.

SM income hits P10.9B, up 13%

MALAYA - SM Investments Corp. (SM Investments) said profit for the first half of the year reached P10.9 billion,  up 13 percent from last year’s P9.6 billion.

“Earnings growth was driven largely by strong earnings growth of residential development, banks and the mall operations. Total revenues grew 14 percent to P105.2 billion from P92 billion as all the core businesses delivered on their sales targets,” SM Investments said.

“EBITDA rose 12 percent to P24.1 billion for an EBITDA margin of 22.8 percent. In the meantime, return on equity is steady at 14 percent,” it added.

The banks continued to provide the largest contribution to SM Investments’ consolidated profit with a 30.9 percent, followed by retail operations with 28.2 percent. Malls came in third with 24.2 percent followed by property development with 16.7 percent.

SM Retail reported a 7.8 percent growth in profit at P2.7 billion from sales growth of 8.3 percent at P73.8 billion. EBITDA was up 11 percent to P4.9 billion for an EBITDA margin of 7 percent. Net margin was steady at 3.7 percent.

The group which consists of a chain of department stores and a separate chain of supermarkets and hypermarkets continued to expand its number of stores nationwide while getting a boost from improved consumer confidence. For the last twelve months, the number of stores increased by 35 of which 2 are department stores, 2 are SM Supermarket, 28 are SaveMore Stores and 7 are SM Hypermarkets. As of end June, SM Retail’s total number of stores reached 183, consisting of 43 department stores, 34 SM Supermarket, 73 SaveMore Stores and 33 SM Hypermarkets.

“The group continues to expand all of its store formats with particular focus on the growth of SaveMore stores which has gained very strong market acceptance. This stand-alone store format which is patterned after a typical neighborhood grocery store offers greater convenience in communities where organized retail is lacking. SaveMore provides fresh food concepts, clean and attractive store layouts, and a highly diverse yet reliable mix of products and services,” SM Investments said.

Mall operation SM Prime Holdings, Inc. posted a 15 percent increase in net income at P4.9 billion from P4.3 billion last year. Revenues reached P14.6 billion, up 15 percent year-on-year. EBITDA for the period grew 12 percent to P9.71 billion for an EBITDA margin of 67 percent. Better growth resulted from the improved performance of the existing malls both in the Philippines and China with same store sales growing by 8 percent, boosted further by the opening of new malls in 2010 and 2011.

The four malls in China posted a hefty 30 percent growth in revenues to P1.3 billion and contributed 9 percent to consolidated revenues. In terms of net income, SM China showed a growth of 52 percent to P321 million, for a net margin of 25 percent and a 7 percent contribution to SM Prime’s consolidated net income. The average occupancy rate for the four malls in China is now at 95 percent.

After opening SM City General Santos in South Cotabato last week, SM Prime now has 45 malls strategically located in the Philippines with a total gross floor area of 5.5 million square meters. In China, SM Prime’s malls are located in the cities of Xiamen, Jinjiang, Chengdu and Suzhou with a total gross floor area of over 600,000 square meters. Earlier this year, SM Prime opened SM City Olongapo in Zambales, SM City Consolacion in Cebu and SM City San Fernando in Pampanga. For the rest of 2012, SM Prime is scheduled to open SM City Lanang in Davao City, and SM Chongqing in China.
 
For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.

Philippine Developer To Build 18 Malls in China As Economy Grows

iREALTYTimes -  A shopping mall developer owned by Phillippine magnate Henry Sy plans on spending $63 million pesos--about $1.5 billion USD--to build a slew of shopping malls and residential structures in China.

SM Prime Holdings, the largest retail developer in the Phillippines, will build four to five malls a year, for three years, according to a report by the South China Morning Post.

The expansion would not only sustain company growth, a spokesperson for the company said, but increase it--thanks to China's blooming market and consumer spending powers.

"I am quite positive that we can accelerate our earnings growth," Hans Sy, son of Henry, told media.
New malls in China will also extend its revenue base beyond the 108 million population in the Philippines to the world's fastest-growing major economy.

Essentially, the growing opportunities in China and Hong Kong will help the influx of cash into Phillippines too, since many Phillipino work in China and Hong Kong, sending most of their salary back home.

Other developers are joining suit. CapitaLand, Southeast Asia's biggest property firm, said last week that its retail unit was building its first shopping centre in Qingdao, adding to its 58 malls in China, of which 15 are under development.

"We want to still acquire more shopping mall projects," CEO Liew Mun Leong told the Post. "That will be a large part of our appetite."

The plan for SM Prime is to focus on lower middle class cities such as Zibo--areas that are not as affluent as, say, Beijing. The company plans to open a mall in Chongqing by the end of this year.

Meanwhile, SM Prime will also build more malls in its native country. But that will come after the Chinese expansion--and the money it will bring.

SM Prime said it would fund the expansion with a mix of cash from operations and debt.


For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.

Highlands nets P16.4m

Manila Standard - Leisure property developer Highlands Prime Inc. is back on the black, posting a net income in the first half of the year on higher revenues from real estate sales.

Highlands Prime said in a financial report filed with the Philippine Stock Exchange that net profit reached P16.4 million, a reversal from a P27.8-million loss year-on-year.

Highlands Prime said total realized revenues rose 61 percent to P254.6 million  from P158 million on year.
“The realized revenues for the current period were better due to the contribution of the residential lot projects, which accounted for 58 percent of the total realized revenues. Condominium and log cabin projects contributed 42 percent of the total,” Highlands Prime said.

The property company has two projects under construction, namely Woodridge Place phase 2 and Sierra Lago.

Woodbridge Place phase 2 is a condominium project at Tagaytay Highlands, while Sierra Lago is a subdivision development at Tagaytay Midlands.

For more details on Woodbridge Place, you may e-mail reby_ramirez@yahoo.com or contact her at 0922.883.9308 / 0916.4044.555 / 0919.699.3572 / 4044-534.

For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.

SM Prime completes 2012 fund-raising

MALL OPERATOR SM Prime Holdings, Inc. has completed its financing requirements for the year amounting to P21 billion, signaling its preparation to spend a further P63 billion in the next three years for expansion here and overseas.

“2012 [fund-raising is] done already. For next year, we will know by [the first quarter] how much we need to raise,” Jeffrey C. Lim, SM Prime executive vice-president and chief financial officer, told BusinessWorld in a text message.

Previously, SM Prime said it was allocating P21 billion for capital expenditure this year, of which P14 billion is intended to fund projects in the Philippines while P7 billion will be funneled for those in China.

The capex was supposed to be sourced from a mix of debt and internally-generated funds.

Last May, the firm announced that it had raised P7.5 billion in fresh funds from the issuance of fixed-rate and floating-rate notes, which were reportedly snapped up by institutional investors.

SM Prime told the stock exchange last week that moving forward, it was earmarking an estimated P63 billion to bankroll the construction of four to five malls in the Philippines, and one mall in China.

“We will raise funding yearly for this,” Mr. Lim said.

SM Prime, however, has yet to determine whether it will tap the equities or bond market for future capex requirements.

“We will have to wait until next year,” Mr. Lim said.

SM Prime was incorporated in 1994 to take charge of the SM group’s commercial shopping centers and related businesses. This year, SM Prime aims to have a mall portfolio of 46 Philippine malls and five China malls, with an estimated combined gross floor area of 6.3 million square meters.

The Sy-led company is eyeing as much as seven new properties in China for mall expansions as the firm exploits higher consumer spending there.

SM Prime hiked its January-to-June net income by 15.22% to P4.92 billion due to its new malls and robust sales, earlier reports show.

Shares of SM Prime dropped by 1.85% to P13.80 last Friday from P14.06 at its previous close.

For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.