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Less malls lined up for 2013

Posted on January 06, 2013 09:48:10 PM [ BusinessWorld Online ]
By Franz J. G. de la Fuente, Reporter
MALL DEVELOPER SM Prime Holdings, Inc. is set to further expand its leasing portfolio and open three mall projects in the Philippines this year -- two in Metro Manila, one in north Luzon -- ahead of more mall launches next year, and in line with the company’s upbeat outlook for 2013, a senior company official said over the weekend.
SM PRIME Holdings, Inc., which capped 2012 with the opening of SM City Congqing in China, does not plan to open any new mall abroad this year.
  “We’ll open one in Isabela, and then [SM] Aura in Taguig [City]. We’ll also open the expansion building in [SM] Megamall, which is almost equivalent to another mall. I think this will be an additional of around 400,000 square meters (sq. m.). The Megamall expansion alone is close to 100,000 sq. m.,” Jeffrey C. Lim, SM Prime executive vice-president and chief financial officer, said in an interview last Saturday on the sidelines of the National Finance Summit at the SMX Convention Center in Pasay City when asked about the company’s plans this year.
While the number of SM Prime’s new mall projects for 2013 is just about half of the number of malls the Sy-led company launched last year, Mr. Lim said this was simply a prelude to more mall openings next year.
“As you can see, we will be opening even more malls in 2014, so it’s really more of our timing. We’re just timing our openings,” Mr. Lim said when asked for the reason for the lower number of malls his company has planned for this year.
“Last year, we already opened five malls, six including China,” he noted, referring SM City Olongapo in Zambales, SM City Consolacion in Cebu, SM City San Fernando in Pampanga, SM City General Santos in South Cotabato and SM Lanang Premier in Davao, which all opened in 2012, in addition to SM City Chongqing in China which opened last month.
Mr. Lim declined to identify the sites new malls the company has planned for 2014.
This year, SM Prime expects to see brisk sales on the back of consumer spending and generally better business conditions seen to be driven by factors like the mid-term elections and progress in public-private partnership projects.
“Actually, we’re optimistic about our operations this year. The economy should continue to perform very well, and then you have the elections and the launching of PPP projects,” Mr. Lim said while declining to elaborate.
Mr. Lim also begged off from discussing SM Prime’s earnings last year.
“We will be announcing the results soon. We’re still consolidating our numbers,” he said.
SM Prime grew its net income by 15.79% to P7.70 billion as of September last year from P6.65 billion in the same nine months in 2011, driven by gains derived from new malls opened in the last three years and higher sales from local and China malls.
In the same comparative periods, revenues -- composed of rent, cinema ticket sales and other income -- went up by 14.69% to P22.10 billion from P19.27 billion, while costs and expenses rose by 14.58% to P10.45 billion from P9.12 billion.
SM Prime was incorporated in 1994 to develop, conduct, operate, and maintain the SM group’s commercial shopping centers and related businesses.
As of end-2012, SM Prime counted 46 local malls and five China malls in its portfolio, with a total combined gross floor area of 6.3 million sq. m.
Mr. Lim had said in November last year that the company was earmarking a record P30 billion in capital expenditures this year -- up 42.86% from last year’s P21-billion budget -- P12 billion-P15 billion of which will be funded by local and foreign debt.
Shares of SM Prime closed at P16.70 apiece on Friday last week, unchanged from their Thursday finish.

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