SM Prime Holdings, Inc. (SM Prime), the Philippines’ leading shopping mall developer and operator which currently owns forty six malls in the Philippines and five malls in China, posted a 15% increase in consolidated net income for the first three months of 2013, amounting to Php2.79 billion from Php2.43 billion in the same period last year. Revenues, on the other hand, reached Php7.83 billion from Php7.03 billion, for an 11% increase, year-on-year.
Rental revenues, accounting for 86% of total revenues, grew by 12% amounting to Php6.73 billion from Php6.03 billion in the same period last year. EBITDA for the period rose 12% to Php5.34 billion, for an EBITDA margin of 68%. This is largely due to rentals from new SM Supermalls opened in 2011 and 2012, namely SM City Masinag, SM City Olongapo, SM City Consolacion, SM City San Fernando, SM City General Santos and SM Lanang Premier, with a total gross floor area of 527,000 square meters. Excluding the new malls and expansions, same-store rental growth is at 7%.
Operating expenses during the first three months of 2013 increased by 11% to Php3.60 billion from Php3.24 billion in 2012 mainly due to new malls launched in 2012. Likewise, income from operations posted 11% growth from Php3.79 billion in 2012 to Php4.23 billion in 2013.
In terms of gross revenues, the five malls in China contributed Php0.69 billion in 2013 and Php0.62 billion in 2012, or 9% of total consolidated revenues. Likewise, in terms of rental revenues, the China operations contributed 10% to SM Prime’s consolidated rental revenues. Gross revenues of the five malls in China increased 11% in 2013 compared to 2012 largely due to improved mall productivity and lease renewals for the first three malls opened namely SM Xiamen, SM Jinjiang and SM Chengdu. Average occupancy rate for the first three malls is now at 96%.
Cinema ticket sales increased by 8% to Php0.76 billion from Php0.70 billion in the same period in 2012 due to more blockbuster movies and fully operational digital cinemas which enable a simultaneous release nationwide. The major blockbusters shown in 2013 were “Sisterakas,” “One More Try,” and “Jack, The Giant Slayer”, among others. SM Prime has forty six Supermalls strategically located in the Philippines with a total gross floor area of 5.6 million square meters (sqm). Likewise, the Company also has five Supermalls located in the cities of Xiamen, Jinjiang, Chengdu, Suzhou and Chongqing in China with a total gross floor area of 0.8 million sqm.
Over the next three years, SM Prime will spend approximately Php88 billion to drive its aggressive expansion plans in the Philippines and China. For 2013, SM Prime plans to open two new malls in the Philippines. Scheduled to open are SM Aura Premier in Taguig and SM City BF in Paranaque. The company is also set to expand SM Megamall this year, with the opening of the 101,000 sqm. Building D.
By the end of this year, SM Prime will have 48 malls in the Philippines and five in China with an estimated combined GFA of 6.9 million sqm.