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THE country’s biggest mall builder and operator
said it will borrow a substantial part of the money required for
next year’s capital expenditures from the local market.
In a briefing, Jeffrey C. Lim, SM
Prime Holdings Inc. executive vice president, said the company will
borrow P4 billion out of the P6-billion capex for next year while
the balance would come from internally generated funds.
SM Prime is set to launch three
malls in the next few months, including SM Baliwag, SM Marikina and
SM Rosales, Pangasinan. The developer is also expanding its existing
malls like SM North and SM Megamall to cater to a growing clientele.
By end-2008, the company expects to have 33 malls nationwide.
Jose T. Sio, SM Investments Corp.
(SMIC) chief finance officer, said the parent company will borrow 40
percent of the group’s P25-billion capital expenditures for next
year. “If it [makes] good sense then we might go for foreign debt
[but] right now we’re (leaning) toward peso loans,” he said.
Earlier, SMIC said next year’s
spending program was almost P6 billion higher than this year’s and
about P15.6 billion of the capex would go to its property develop-ment,
P6 billion to its mall business, P2.3 billion its banking arm, and
the remaining P2 billion to its retail business.
At-end September, SMIC’s net
income had grown 14 percent to P8.5 billion, with its recurring
income up 22 percent to P6.2 billion over a year ago. Consoli-dated
revenues surged 96 percent to P82.6 billion, 82 percent of which
came from its retail business, which jumped 130 percent to P65.2
billion due to the acquisition of SM Supermarkets and Hypermarkets
last year.
By the end of this year, SMIC
expects total revenues to hit P100 billion.
The SM group is developing its SM
Mall of Asia Complex and its large-scale ecotourism project in
Nasugbu, Batangas. At the same time it is expanding the Taal Vista
Hotel, converting the 400-room Cebu hotel into a five-star facility
managed by Sofitel. The group also began construction of a 400-room
Radisson Hotel in the Mall of Asia Complex to be opened in 2009.
Lim said the SM group may
finalize the acquisition of founder Henry Sy’s malls in China
valued at P10.8 billion. These would be folded under SM Prime by the
second quarter next year.
--Likha C. Cuevas-Miel
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