Property giant SM Prime Holdings grew its net profit in the first quarter by 15 percent year-on-year to P7.6 billion as shopping mall and residential development pumped up revenues.
Driven by the expansion of its mall and residential businesses in key cities, SM Prime’s consolidated revenues reached P23.4 billion in the first three months, higher by 14 percent from the same period last year.
“The growing revenue contribution of our mall operations in the provinces and increasing reservation sales of our residential projects in Metro Manila drove our bottom line higher and kept us in line with our first quarter target in 2018. Nevertheless, we plan to continue expanding in key cities all over the Philippines to sustain our growth targets over the next few years,” SM Prime president Jeffrey Lim said in a press statement.
SM Prime posted a 10-percent revenue growth in its malls business to P13.9 billion, accounting for 59 percent of total business.
New malls that opened in 2016 and 2017 helped improve rental revenues, delivering P11.9 billion, 12 percent higher from last year’s P10.7 billion.
SM Prime’s malls operating income increased by 11 percent to P7.8 billion while operating margin was steady at 56 percent. Excluding the impact of new malls, same-mall sales grew by 7 percent year-on-year for the first three months of the year.
Cinema and event ticket sales declined by 9 percent to P1.11 billion due to less-than-stellar international blockbuster movies shown compared to 2017.
Meanwhile, SM Prime’s residential group, led by SM Development Corp. (SMDC), posted a revenue growth of 25 percent in the first quarter to P7.5 billion.
As an indicator of future growth, SMDC’s reservation sales grew by 20 percent in terms of sales value to P14.8 billion in the first quarter.