SM Prime first-half profit steady at P 24.5B

MANILA, Philippines — Property giant SM Prime Holdings Inc. (SMPH) kept its first-half net income steady at P24.5 billion as faster growth in costs and expenses offset gains across most of its businesses.

The Sy family-led property developer said net income in the first six months was unchanged from P24.5 billion a year ago.

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Total revenues, meanwhile, grew 5 percent to P71.7 billion, driven largely by rental income from its malls, offices, hospitality and meetings, incentives, conferences and exhibitions businesses.

Rental income accounted for 61 percent of total revenues. Real estate sales contributed 27 percent, while cinema ticket sales, food and beverage, amusement and related offerings made up the remaining 12 percent.

However, costs and expenses rose at a faster pace of nearly 6 percent to P35.6 billion due to higher depreciation and amortization charges, fixed overhead costs and construction expenses.

“Our focus on tenant relationships, customer experience and cost management supported our performance,” SM Prime president Jeffrey Lim said.

“Despite challenging market conditions, commercial demand remained resilient across our portfolio,” Lim said.

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Mall revenues increased 8 percent to P41.8 billion on higher occupancy, stronger tenant sales and improved operational efficiency.

Residential revenues, however, slipped 1 percent to P20.6 billion due to lower revenue recognition from prior-year sales.

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Hotels and convention centers generated P4.4 billion in revenues, up 8 percent on higher bookings and average daily room rate.

Office and warehouse revenues climbed 9 percent to P5 billion on higher space take-up.

For the second quarter alone, consolidated net income inched up 1 percent to nearly P12.9 billion from P12.8 billion.

April-to-June revenues rose 9 percent to P38.4 billion, while costs and expenses similarly increased by nearly 9 percent to P19 billion, mainly due to higher construction costs.

SM Prime ended June with total assets of P1.1 trillion. Capital expenditures fell 18 percent to P30.7 billion. INQ