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.
 
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