Profits of SM Investments Corp. (SMIC), the holding firm of mall magnate Henry Sy, grew 13 percent in the first quarter of the year, fueled by the strong performance of its retail, mall and real estate businesses.

Despite the economic crisis, SMIC's net income rose to P4.2 billion in January to March this year from P3.7 billion in the same months in 2008, the company said in a statement.

The firm's consolidated revenues went up 11 percent year-on-year to P35.2 billion.

Retail revenues from department stores, supermarkets and hypermarkets grew 10.4 percent to P23.7 billion while rental revenues from malls increased 22 percent to P3.8 billion.

The retail and wholesale division accounted for 33 percent of SMIC's net income and the malls contributed 31 percent. The rest came from the holding firm's banks (22 percent) and real estate units (14 percent).

SM retail stores posted first-quarter earnings of P1.37 billion, up 30.4 percent from P1.05 billion in the same period last year. To date, SM has a nationwide network of 34 department stores, 41 supermarkets, 13 hypermarkets and 14 Makro wholesale outlets.

SMIC's mall segment SM Prime Holdings, on the other hand, reported a 7 percent rise in net income to P1.7 billion on the back of robust rental income from new and existing malls. The subsidiary recently opened SM City Naga, bringing the total number of its shopping centers to 34.

Revenues from SMIC's real estate and property development operations expanded by 82 percent to P2.4 billion while net income surged 159 percent to P7 million, owing mainly to the residential sales of listed unit SM Development Corp. Further contributions came from the leasing activities of SMIC's commercial properties group;, the sale of condominium units and club shares in Pico de Loro, and a resort project in Hamilo, Batangas.

Banking units Banco de Oro Unibank and China Banking Corp. recorded first-quarter net profits of P1.01 billion and P880 million, respectively. BDO's quarterly earnings were 24.6 percent lower than last year's, but China Bank's marked an increase of 24 percent.

Unlike most local companies, the SM group is pursuing expansion plans this year despite a tough operating environment.

"SM is prepared to meet the challenge of a changing environment with vigor and a long-term view of the Philippine economy’s resilience. This view sustains us in further expanding and improving our products and services not just to suit market needs, but more importantly, to give value for money to our customers," said SMIC president Harley Sy.

SMIC has earmarked P31 billion for capital expenditures in 2009, 29 percent more than the P24 billion it spent a year ago, as it expects to post a 12-14 percent improvement in full-year net profit.

The bulk or P12 billion of SMIC's capex this year will be spent by SM Prime for the construction of malls in the Philippines and China