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SMIC estimates faster growth for second-quarter net income

Posted on July 16, 2012 10:38:11 PM [ BusinessWorld Online ]

HOLDING FIRM SM Investments Corp. (SMIC) is likely to book double-digit growth for the second quarter versus a year ago and even top its first quarter performance due to the robust showing of its core businesses, an official said yesterday.

“We expect to maintain our net income growth for the second quarter.

[It may be] even a little better than the double-digit growth we achieved during the first quarter,” Jose T. Sio, SM Investments executive vice-president and chief finance officer, said in a text message following the company’s bond listing at the Philippine Dealing Exchange Corp. yesterday.

This growth will still be driven by the firm’s core businesses such as banking, real estate, mall development, and retail, Mr. Sio added.

In the second quarter of 2011, SM Investments booked a net income of P4.28 billion versus P3.77 billion in 2010, a 13.53% growth.

The company realized a first-quarter net income of P6.04 billion this year, up 12.48% from a year ago.

Revenues, mostly comprised of merchandise, real estate, and other sales, rose by 16.16% to P49.68 billion from P42.77 billion last year, while costs and expenses grew by 17.01% to P39.07 billion from P33.39 billion, year on year.

The Sy-led conglomerate has been bullish on its expansion plans, which it has complemented with aggressive financing efforts lately.

Yesterday, it listed on the fixed-income bourse its Series A bonds due 2014 and Series B bonds due 2016 worth a combined P10 billion, as well as its recently-issued Series C bonds due 2019 and Series D bonds due 2022 jointly worth P15 billion.

In a related development, Mr. Sio declined to elaborate on his company’s plans regarding the possible acquisition of a stake in developer Ortigas & Co. Ltd. Partnership Holdings, Inc. (Ortigas Holdings).

Earlier this month, BusinessWorld had reported that the SM Group’s attempted purchase of a 34% stake held by Hongkong and Shanghai Banking Corp. in Ortigas Holdings was blocked by members of the Ortigas family, who bought out the said stake.

However, various SM officials later hinted that the SM camp will likely bid again for a stake in Ortigas Holdings moving forward, even as rival Ayala Land, Inc. announced that it was exploring partnering with the Ortigas family for a possible “strategic alliance.”

SM Investments shares rose by 2% to P739.50 apiece yesterday. -- Franz Jonathan G. de la Fuente         

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