SM Investments Corp., the holding firm of the Sy family, on Wednesday reported a slightly higher attributable net income last year as lower trading gains pulled up the company’s profits.
The company said it made a record P28.4 billion in earnings last year, some 3 percent higher than the previous year’s attributable income of P27.4 billion. Excluding extraordinary items, such as trading gains from the banks, SM’s recurring net income grew 14 percent, the company said.
SM’s underlying earnings growth was mainly driven by BDO Unibank Inc., the country’s largest lender, which posted a core-income growth of 18 percent. Together with China Banking Corp., banks accounted for 41 percent of SM’s consolidated net income in 2014. Property, meanwhile, contributed 38 percent and retail 21 percent.
“The group’s strong underlying earnings growth was the result of solid performance and ongoing expansion in all our three core businesses. During the year we raised additional capital and entered into several strong partnerships, accelerating our investments for growth and ensuring we expand in line with our continuing optimism about the economic prospects of the Philippines,” SM President Harley Sy said in a statement.
Consolidated revenues grew 9 percent to P275.7 billion in 2014, from P253.3 billion in 2013, mainly as a result of good retail environment, which also boosted rental revenues in SM’s property business.
Last year SM raised P15 billion in May 2014 from a public offer of peso-denominated retail bonds with maturities of seven and 10 years. In June 2014, SM issued a $350-million 10-year senior unsecured bond at a fixed rate of 4.875 percent per annum, a landmark transaction marking the longest-dated dollar bond issued by SM and the company’s fourth dollar-denominated bond issuance since 2009.
BDO recorded net income attributable to equity holders of the parent of P22.8 billion, slightly higher than the P22.6 billion in the previous year. BDO’s recurring income grew 18 percent, excluding one-off trading gains in 2013.
On the other hand, property developer and mall operator SM Prime Holdings Inc. registered consolidated net income of P18.4 billion last year, a 13-percent increase year on year, on the back of revenue growth of 11 percent to P66.2 billion. SM Retail Inc. sustained its growth with net income increasing by 3 percent to P5.9 billion, while total sales rose 9 percent to P197.1 billion.