SM PRIME Holdings, Inc. delivered a 16% profit increase in the January to March period, as its shopping mall, residential development, and commercial properties continued to see strong growth.
The Sy-led property developer said in a statement Monday that consolidated net income stood at P8.8 billion in the first quarter of 2019, higher than the P7.6 billion it posted in the same period a year ago.
Consolidated revenues also rose by 14% to P26.5 billion, driven by higher rental income and residential sales.
“SM Prime continues to benefit from the overall growth of the Philippine economy that boosts the household income of most families. We are optimistic that we will sustain this performance this year as we continuously expand our core businesses in developing provincial cities across the country,” SM Prime President Jeffrey C. Lim said in a statement.
The mall segment accounted for 56% of SM Prime’s consolidated revenues for the period at P15 billion, eight percent higher year on year. This was supported by an eight percent increase in mall rental revenues to P12.9 billion, thanks to the opening of new malls from 2017 to 2018. Same-mall sales growth was also steady at seven percent.
The spate of international and local blockbuster movies during the period boosted cinema and event ticket sales by five percent to P1.2 billion, while other mall revenue streams such as bowling and ice-skating also grew by eight percent to P881 million.
The residential business, primarily through SM Development Corp. (SMDC), contributed 35% of consolidated revenues at P9.2 billion, 23% higher from the same period a year ago. SMDC attributed the increase to the higher construction accomplishments of projects launched from 2015 to 2017, as well as revenue recognition for recently launched projects.
SMDC’s residential projects include Cheer Residences, Green 2 Residences, Hope Residences, Charm Residences, and Bloom Residences, among others. Reservation sales were up by 20% to P17.8 billion or equivalent to 4,585 units.
“The continued increase in sales take-up is due to strong demand fueled by international buyers, overseas Filipinos’ remittances, and rising disposable income of the emerging middle class,” the company said.
SMDC plans to unveil up to 20,000 residential units within the year, from a range of high-rise and mid-rise buildings as well as single-detached house and lot projects for the rest of the year.
The remaining nine percent of SM Prime’s revenues came from its other businesses consisting of offices, hotels, and convention centers. This segment grew its topline by 14% to P2.3 billion, from the operation of 11 office buildings covering 642,000 square meters in gross floor area, in addition to six hotels, four convention centers, and three trade halls.
SM Prime has further expanded its hospitality portfolio with the opening of Park Inn by Radisson-Iloilo on April 2. It is also scheduled to open Park Inn by Radisson-North Edsa in the second half of the year. — Arra B. Francia