Property heavyweight SM Prime Holdings Inc. said core net income grew by 12 percent in the first quarter of the year to P5.8 billion from the P5.2 billion in the same quarter last year, driven by strong revenue from mall operations.
In a disclosure to the Philippine Stock Exchange on Monday, SM Prime reported that consolidated revenues surged by 10 percent to P18.2 billion from P16.7 billion in the same comparable period.
SM Prime noted mall revenue accounted for 60 percent of consolidated revenue, of which 85 percent came from rental income–that rose by 11 percent to P11 billion from the P9.9 billion.
“Growth was largely driven by new malls and expansion of existing malls in 2015,” SM Prime said.
“SM Prime’s massive expansion last year propelled our performance this quarter. Our strong balance sheet coupled with consistent recurring revenue and income should allow us to pursue our growth plans this year and in the medium term,” SM Prime President Hans Sy, said.
The firm has 57 malls in the country and six in China with a total retail space of 8.4 million square meters.
SM also reported its residential group saw a -percent increase in revenue during the first quarter to P5.8 billion from P5.4 billion a year earlier.
“The increase can be traced by the higher construction accomplishments of SM Development Corporation (SMDC) projects launched in 2013 to 2015,” SM Prime said.
SM Prime has 28 residential projects in the markets of Metro Manila and Tagaytay.
“For the rest of the year, SM Prime is still set to launch an additional 10,000 to 12,000 units located in the Mall of Asia Complex, Tagaytay, Quezon City, Bulacan, Cavite and Cabanatuan,” the firm noted.
Consolidated cost of real estate slightly increased by 2 percent to P2.9 billion during the quarter, on the back of higher revenues recognized in real estate sales.
SM Prime’s Commercial Properties Group, which accounted for 5 percent of its consolidated revenue, saw a 16 percent rise in revenue at P1 billion.
For its hotels and convention centers business, SM Prime reported a 22 percent increase in revenue to P617 million.
“The growth was propelled by an improvement in the average room and occupancy rates which was supplemented by the opening of the 154-room Park Inn Clark in Pampanga,” SM Prime said.
The firm noted that it is set to unveil its 347-room Conrad Manila hotel in the second half of the year.