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New malls lift SM Prime bottomline

Wednesday, 10 November 2010 00:00
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THE Philippines’ largest retailer reported that its profit in the third quarter rose by a tenth, driven by new mall openings. In a statement, SM Prime Holdings Inc. said its consolidated net income rose 12 percent to P1.9 billion in the July to September period from P1.7 billion in the same period last year.
This led SM Prime’s nine-month income to P5.6 billion, up 11 percent from P5.1 billion last year.
“Our performance for the first nine months of 2010 remains on track, and in fact better than we earlier expected given a more robust consumer environment,” Hans Sy, SM Prime president, said.
“The domestic economy displays strength and sustainable growth which fuels increased spending that flows into SM malls. We expect this trend to continue into the last quarter of the year, when the holiday season further boosts consumer spending,” he added.
Consolidated revenues grew 14 percent to P5.7 billion in the third quarter from last year’s P5 billion, pushing nine-month revenues to rise 17 percent to P17 billion.
Consolidated rental revenues contributed 84 percent to the total revenues in the first three quarters, increasing by 13 percent to P14.3 billion because of the opening of new malls and same store rental growth of 6 percent.
New malls that opened in 2009 were SM City Naga, SM City Rosario and SM Center Las PiƱas along with SM City Tarlac, which opened in April of this year.
The new malls and expansion in SM North Edsa, SM City Fairview and SM Rosales in Pangasinan added 340,000 square meters to the company’s total gross floor area. Average occupancy rate stood at 97 percent.
Cinema ticket sales also jumped 41 percent to P2 billion from P1.4 billion last year.
In October, SM Prime launched three new malls, namely SM City Novaliches in Quezon City, and SM City San Pablo and SM City Calamba in Laguna.
The company is set to unveil later this year its fourth mall in China in the city of Suzhou.
By the end of the year, SM Prime will have 40 malls nationwide and four shopping centers in China, bringing its total estimated gross floor area to 5.4 million square meters.
SM Prime shares were unchanged at P11.74 on Tuesday.

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