PROPERTY giant SM Prime Holdings Inc. saw its net income improve by 14 percent in 2016 on the back of continued mall expansion and robust residential sales.
Excluding the P7.4 billion one-time gain from stock trading in 2015, SM Prime said its recurring net income expanded to P23.8 billion in 2016 from P20.9 billion in the previous year.
Consolidated revenues were up 12 percent at P79.8 billion in 2016, driven by an 8 percent increase in mall revenues, 13 percent improvement in residential sales, and 32 percent surge in commercial office revenues.
“SM Prime sustained its overall performance in 2016 on account of focusing more on recurring income stream complemented by the solid performance of the housing group,” SM Prime President Jeffrey Lim said.
Mall revenues rose 9 percent from a year earlier to P48.6 billion as retail space gross floor area (GFA) increased to 1.5 million square meters (sqms) over the past two years. Existing malls posted 7 percent growth in sales.
Malls, cinema and event ticket sales dipped by 3 percent to P4.7 billion while amusement and merchandise sales rose 16 percent to P3 billion.
SM Prime plans to open four malls in the Philippines this year. To date, the Sy family-led firm has 60 malls in the Philippines with total GFA of 7.7 million sqms and seven malls in China with 1.3 million sqms of floor space.
Residential sales under SM Development Corp. (SMDC) grew 13 percent to P25.4 billion on the higher take-up of ready for occupancy units. The residential business accounted for 32 percent of total revenue.
Under SMDC, reservation sales went up by 18 percent to P46.7 billion as unit sales grew 15 percent to 16,320 units, with strong sales seen in projects within and near the Mall of Asia (MOA) Complex in Pasay City which are: S Residences, Shore 2 Residences and Coast Residences.
Sales from commercial offices surged 32 percent to P2.7 billion, which contributed 3 percent of the consolidated revenues. The growth came from new rental revenues from FiveE-comCenter, which is almost 100 percent occupied.
SM Prime currently has six office buildings mostly in the MOA Complex with an estimated GFA of 371,000 sqms.
Revenues from hotel and convention centers also improved by 32 percent to P3.2 billion on increased hotel occupancy and the opening of Park Inn Clark in December 2015 and Conrad Manila in June 2016.
SM Prime is the property subsidiary of the Sy family under umbrella conglomerate SM Investments Corp. (SMIC).