Posted on June 04, 2012 09:22:16 PM [
BusinessWorld Online ]
SM DEVELOPMENT Corp. (SMDC) expects
profits to grow faster than original estimates after recording steady sales
growth so far for January to April, an official said.
“We did P4.18 [billion] last year. We
are looking at doing 20-25% [higher this year],” SM Development President and
Chief Executive Rosaline Y. Qua told reporters in a chance interview last week.
“We are based on percentage
completion. As construction goes on, we are going to know how things will come
along,” she said.
“We are bullish on how things are,”
Ms. Qua added.
The new profit guidance compares
against the 15-20% growth target disclosed earlier for both profits and sales
this year.
The new target is nevertheless slower
than the 38% hike the Sy-led property developer recorded in 2011 on the back of
strong revenues from real estate operations.
The upbeat outlook comes as the
company said it has sustained growth seen in the first quarter.
“[We are] doing P3 billion a month. We
were able to sustain that in April,” she said. “We did around P3.55 billion in
April.
The May figures, she said, “were also
looking good.”
Ms. Qua said the company’s sales
outlook remains bullish despite reports of a looming oversupply of
condominiums.
“It is a whole cycle of demand,” she
said. “From our end, we have kept within our business model which has worked.”
“It is not to build something the
market would want, but something the market really wants,” she pointed out.
For 2012, the developer is planning to
spend around P30 billion in capital expenditure and launch five residential condominiums
in Metro Manila as well as the second phase of its existing Grass Residences.
These projects, which will have an
estimated total market value of P37 billion, will add to its current portfolio
of 15 SM Residences projects and two projects under M Place.
Expansions are also set for SM
Development’s Wind, Jazz, and Field Residences, as well as M Place @ South
Triangle.
This, as SM Development hiked its
first-quarter net income by more than a third, driven by double-digit uptick in
the value of pre-sales first quarter of the year.
The company’s consolidated net income
rose by 33% to P1.21 billion from P916 million in the same period last year,
reflecting a 59% year-on-year growth in the value of pre-sold units to P8.97
billion in the quarter.
This, however, is slower than the 45%
hike the company notched last year coming from a P632.4-million net income in
the first quarter of 2010.
For the first quarter, SM Development
pre-sold 3,684 condominium units, up 51% from year-ago levels, a disclosure
noted.
Consolidated revenues increased by 72%
to P5.83 billion, a bulk of which were comprised of revenues from real estate
operations that added 72% to P5.61 billion versus P3.26 billion, year on year.
Shares of SM Development fell by 2.28%
to P6 apiece yesterday. -- Cliff Harvey C. Venzon
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