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SMIC profit jumps 13% in 2018

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By Arra B. Francia, Reporter

SM INVESTMENTS Corp. (SMIC) increased its earnings by 13% in 2018, as the company’s property, banking, and retail units continued to show steady growth.

In a statement issued Thursday, the Sy family’s listed holding company said net income rose to P37.1 billion last year, higher than the P32.9 billion it posted in 2017. Consolidated revenues likewise went up 13% to P449.8 billion.

“Our very good results in 2018 were driven by all three core businesses, retail, banking and property, each of which delivered strong revenue growth and also strong earnings growth,” SM President Frederic C. DyBuncio said in a statement.

“We remain optimistic about the economic environment and growth opportunities for the group in 2019.”

Sought for comment, Philstocks Financial, Inc. Research Associate Japhet Louis Tantiangco said SMIC’s 2018 performance was “impressive.”




“The 13% year-on-year growth in net income to P37.1 billion was far beyond its five-year compounded annual growth rate of 5.94%,” Mr. Tantiangco said via text.

The listed conglomerate’s property unit provided 41% of the group’s earnings in 2018, followed by banks and retail which accounted for 38% and 21%, respectively.

SM Prime Holdings, Inc., the holding firm for SMIC’s property investments, saw its net income climb 17% to P32.2 billion after a 14% uptick in consolidated revenues to P104.1 billion.

The property unit benefited from the provincial expansion of its shopping malls, which delivered revenues of P59.3 billion, 11% higher year on year. Rental income gained 11% to P50.5 billion, also due to higher contributions from new and expanded malls in the provinces.

SM Prime ended 2018 with a total of 72 malls in the Philippines covering a gross floor area of 8.3 million square meters (sq.m.), while seven malls spanning 1.3 million sq.m. are located in China.

BDO Unibank, Inc. reported a net income of P32.7 billion, 17% higher year on year. This was attributed to a 20% expansion in its net interest income to P98.3 billion, driven by the performance of its core lending and deposit-taking businesses.

Total deposits at BDO Unibank stood at P2.4 trillion by the end of 2018, 14% higher year on year.

Meanwhile, China Banking Corp. exhibited a seven percent profit growth to P8.1 billion, on the back of a 17% increase in net interest income to P22.9 billion.

SM Retail, Inc. posted a net income of P11.3 billion, eight percent higher than its P10.4 billion record in 2017. Total revenues rose by 12% to P335.6 billion in the same period. The firm covers SMIC’s food and non-food businesses.

SM Retail added 335 new stores in 2018, ending the year with a total of 2,328 outlets consisting of 63 The SM Stores, 1,383 specialty retail outlets, 56 SM Supermarkets, 53 SM Hypermarkets, 195 Savemore, 52 WalterMart, and 526 Alfamart stores.

Asked for his outlook on SMIC, Philstocks’ Mr. Tantiangco said he expects the firm to have a good year, with its property arm being the main contributor to its bottomline.

“Stronger contributions are also seen from its retail segment given that commodity prices are already stabilizing,” he said.

Shares in SMIC plunged 2.69% or P26 to close at P940 each, in tune with the main index’s 2.33% drop for the day.

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