SM Prime profits grow to P14 B amid reopening

SM Prime Holdings Inc., one of the leading integrated property developers in Southeast Asia, reported a 21 percent growth in consolidated net income to P14.1 billion in the first half of 2022 from the P11.6 billion earned in the same period last year.

In a disclosure to the Philippine Stock Exchange, the firm said profit growth is supported by a 13 percent increase in consolidated revenues to P46.3 billion from P41.1 billion in the same period being reviewed.

Consolidated operating income recorded a 33 percentgrowth to P21.4 billion in the first half of 2022 from P16.1 billion in the same period last year.

“The growing domestic demand over the past period kept SM Prime’s financial growth steady as reported in our first half of 2022 results,” SM Prime President Jeffrey Lim said.

He added that, “We are optimistic that despite the global economic slowdown, the local economy will continue to benefit from the sustained growth in remittances from overseas Filipino workers (OFWs), the business process outsourcing (BPO) industry, as well as the increase in local travel and tours activities.”

SM Prime’s Philippine mall business’ revenues, which accounts for 44 percent of the company’s consolidated revenues, surged by 92 percent to P20.6 billion in the first half of 2022 from P10.7 billion in the same period of 2021.

The increase is due to the 80 percent growth of mall rental income to P18.6 billion in 2022 from P10.3 billion in 2021.

Given the more relaxed community quarantine in major key areas in the Philippines during the reported period, SM Prime’s cinemas, event ticket sales, and other revenues grew to P2.0 billion from P0.5 billion.

SM Prime’s China mall business revenue reached RMB0.39 billion in the first half of 2022, almost the same level in 2021.

SM Prime’s residential business group, led by SM Development Corporation (SMDC), reported P18.2 billion in revenues in the first half of 2022, 25 percent lower than the P24.5 billion posted in the first half of 2021.

The decrease in revenue was partly due to canceled sales as an effect of the lapse of Bayanihan Act, which gave a reprieve to unit buyers during the height of the pandemic, affecting the entire industry.

The economic uncertainty brought about by the pandemic also contributed to the decline in revenue.

SMDC’s reservation sales grew by 49 percent in unit sales to 12,327 this year from 8,269 last year. This translates to an 8 percent increase in reservation sales to P59.4 billion in January to June of 2022 from P55.1 billion in the same period last year.

SM Prime’s other key businesses, which include offices, hotels, and convention centers, recorded a 49 percent growth in revenues to P4.5 billion in the first half of 2022 from P3.0 billion in the first half of 2021.

The company’s office business segment recorded P2.8 billion revenues, 14 percent higher than the same period last year, while the hotels and convention centers business segment’s revenues are at P1.7 billion, 205 percent higher from the first half of last year.