SM Prime's 9-month profit rises by 15%

Posted at 10/29/12 12:04 PM

MANILA, Philippines - SM Prime Holdings Inc., the country's leading mall developer and operator, reported a 15% jump in consolidated net income in the first 9 months of 2012. 

SM Prime said its consolidated net income for the January to September period reached P7.4 billion, compared to P6.41 billion a year ago. 

Revenues hit P22.10 billion, up 15% from P19.27 billion year-on-year. EBITDA for the period rose 12% to P14.60 billion, for an EBITDA margin of 66%. 

The company attributed the growth to rentals from the new malls it opened in the country; an 8% increase in same-store sales; and improved performance of SM malls in China.

In the third quarter alone, SM Prime posted a 16% rise in net income to P2.48 billion, on revenues of P7.52 billion. 

"Our performance for the first nine months of 2012 gives us confidence in reaching our full-year target. We think that consumer sentiment will remain positive on the back of a strong domestic economy. Moreover, we anticipate this trend to continue as we approach the holiday season, when consumer spending is particularly strong," SM Prime president Hans T. Sy said, in a statement. 

Operating expenses for the first 9 months of the year rose by 14% to P10.45 billion, on the back of higher administrative expenses, particularly, utilities and manpower expenses, business taxes, and film rentals. 

The gross revenues from the 4 SM malls in China increased by 27% in the first 9 months of the year, due to improvements in the average occupancy level, lease renewals, and the opening of SM Xiamen Lifestyle and SM Suzhou. The 4 malls have an average occupancy rate of 96%.

This year, SM Prime has opened SM City Olongapo in Zambales, SM City Consolacion in Cebu, SM City San Fernando in Pampanga, SM City General Santos in South Cotabato and SM Lanang Premier in Davao City. 

SM is scheduled to open another mall in China - SM Chongqing in December. 

By the end of 2012, SM Prime will have 46 malls in the Philippines and 5 in China.