From a small shoe store (Shoemart) in 1958 to a shoe store chain in the 60’s; and from a department store in the 70’s to a shopping mall in the 80’s, Mr. Sy’s businesses struck a familiar chord with ordinary Filipinos. Soon enough, SM grew and diversified, steadily expanding its retail offerings while growing its commercial and residential properties and its banking and finance platforms.
SM has become a part of every Filipino’s life and continues to expand into developing areas as the economy grows. A Cinderella-story, SM both epitomizes the Philippines’ new economic dynamism and drives it.
SM Senior Vice President for Investor Relations and Corporate Communications Cora Guidote is confident that the Philippines will continue to enjoy strong growth relative to the region as SM is focused on tapping growth in its three core businesses of retail, property and banking/financial services.
“We have a young population that is entering the productive and prolific stage in their lives which is mainly responsible for an expanding middle class. Aspirations are high and SM is in the business of fulfilling the aspirations of millions,” Ms. Guidote said.
“Our retail stores, property projects and financial services are geared toward being a catalyst for growth in the lives of the people and in the communities we serve,” she added. “Our products and services are driven by innovation and global trends amidst an inclusive marketing approach.”
Catering to the needs of families, communities and the environment, SM prides itself on sustainable business models, embracing marginalized sectors by providing free education, health services, and livelihood programs.
“Environmental considerations include awareness, conservation or preservation and disaster resilience, all of which have specific provisions in our properties,” said Ms. Guidote. “We adhere to global standards of good corporate governance and all these are laid out in our Environmental, Social and Governance (ESG) report and websites.”
Strong values, a close knit team and not forgetting where they came from have yielded encouraging results for SM.
“This kind of business acumen has resulted in a resilient, sustainable and high growth model that has withstood both internal and external shocks to the Philippine economy,” says Ms. Guidote. “Our market cap grew from about US$3 billion when we listed in 2005 to approximately US$17 billion so far this year, delivering a compounded growth in value of 16-18% per annum to our shareholders.”
Despite its size relative to its peers in the Philippines, SM is a medium-sized company compared with its Asian counterparts:
“This provides further impetus for growth for the whole group. “Our expansion plans remain fairly aggressive by local standards and will cost an average of US$1.5 billion to US$ 2 billion per annum pending approvals for some of our large property projects.”
Based on their track record, SM looks like a good bet.