Vol. XXI, No. 201 [ Business World Online ]
Wednesday, May 14, 2008 | MANILA, PHILIPPINES
SM INVESTMENTS Corp. said on Tuesday its net income had grown by 15% in the first quarter, buoyed by strong revenue growth from its retail and property business.
SM Investments, the holding firm of one of the country’s richest men, Henry Sy, said net income rose to P3.8 billion in January to March versus the 3.3 billion pesos reported in the same period last year.
"Notwithstanding greater challenges from external factors, SM continued to deliver healthy earnings growth in the first quarter, mainly driven by increased efficiencies in the retail sector, and the increasing momentum in the property business," company President Harley Sy said in a statement.
SM Investments’ businesses, which center on its malls, have capitalized on robust consumer spending, which is largely fueled by billions of dollars in remittances sent home by Filipinos working overseas.
As in the rest of Asia, consumers in the Philippines are facing rising costs of food, fuel and other basic goods, which are expected to crimp private consumption. Annual April inflation jumped to a near three-year high of 8.3%.
SM Investments’ consolidated revenues climbed by 14% to P30.1 billion in the first quarter.
Retail revenues went up by almost a fifth to P25.2 billion and rental revenues from malls and other properties also expanded by 13.5% to P2.9 billion. Last year, SM Investments’ net profit rose by 14% to P12 billion.
The listed holding firm earlier said it expected robust growth in revenues and earnings this year despite a weaker economic environment.
SM Investments Chief Financial Officer Jose Sio said the company had so far been largely unaffected by a slowdown in consumer spending.
He predicted that SM Investments would experience an earnings growth of 13% to 14% this year, in line with simulations made in a five-year plan.
This year, the company will spend P26.9 billion for the capital expenditure needs of its operating units. Last year, the amount was P20 billion. — Reuters
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