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SM Prime net income rises 15% to P2.43B in Q1 ’12

04/25/2012 [ ]

SM Prime Holdings Inc. (SMPHI) posted a 15 percent jump in consolidated net income to P2.43 billion in the first quarter of 2012 from P2.12 billion in the same period in 2011 on the back of newly opened malls both in the country and in China.

The firm started the year strong by continuing to exceed its growth targets during the first three months of 2012 as its consolidated revenues grew 16 percent to P7.03 billion from P6.07 billion during the same period last year.

Ebitda meanwhile rose 13 percent to P4.76 billion, resulting in an Ebitda margin of 68 percent.

SMPHI CFO and EVP Jeffrey Lim said these results include the operations of the four SM malls in China, which are located in the cities of Xiamen and Jinjiang in Southern China, Chengdu in Central China, and Suzhou in Eastern China.

He noted that the robust results were driven by a mix of factors namely additional capacity from new malls opened in the Philippines in 2010 and 2011 — with store rental growth of 8 percent from 7 percent, and the rising momentum in its China operations — with the four SM malls having combined gross revenues rising sharply by 34 percent.

SMPHI president Hans Sy said the company’s better-than-expected performance during the first three months is a welcome development as it confirms their optimism in the Philippine economy and SM’s ability to thrive in competitive environments in China.

“This bodes well with our plan this year to open five new malls in the Philippines and one in China. With these new malls, SM Prime greatly enhances its capability to serve the varied needs of its clients and to maintain its dominant position in the industry,” he added.

Earlier this year, SM Prime inaugurated SM City Olongapo, its first mall in the province of Zambales. For the rest of 2012, SM Prime is scheduled to open SM City Lanang in Davao City, SM City General Santos in Southern Mindanao, SM City Consolacion in Cebu, SM City San Fernando in Pampanga, and SM Chongqing in China.

For the first three months of 2012, SM Prime’s consolidated rental revenues contributed 86 percent to the total, increasing by 15 percent to P6.03 billion on the back of 427,000 square meters additional rental space coming from SM City Tarlac, SM City San Pablo, SM City Calamba, SM City Novaliches, SM City Masinag and the recently opened SM City Olongapo.

By the end of this year, SM Prime will have 46 malls in the Philippines and five in China with an estimated combined GFA of 6.3 million sqm. Danessa O. Rivera

Lim also said the 15 percent growth in the first quarter could be a trend for the full year 2012.

“Barring any major setbacks or probles, this should be achievable moving forward given that we expect the government to pursue PPP spending or projects and we continue to see improvement in OFW remittances, the BPO which is consistently growing and there is confidence in the economy. With this, we expect consumer spending to improve,” he said. Danessa O. Rivera

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