SM Prime Holdings Inc. on Monday said its income forº the first half almost doubled from the same period last year as a result of one-time trading gains. Revenues grew at a single-digit rate.
The company said its income for the period reached P18.7 billion, or almost double from last year’s P9.8 billion. That figure, however, included one-time trading gains on securities.
Removing those gains, its income would have been at P11.2 billion, or only 15 percent higher, the company said.
Consolidated revenues grew by 8 percent to P35.9 billion for the period from P33.3 billion last year, mainly driven by the continued growth in rental revenues, as well as higher revenue recognition on completed projects of its real-estate business. “The strong financial performance is reflective of the benefits derived from a diversified property portfolio, as both rental and developmental incomes contributed to the overall performance of the company. The sustained growth could be attributed to the consolidation of SM Prime, which resulted in a strong balance sheet that allowed us to pursue all projects as planned. We are confident that we can sustain this growth in the long term,” SM Prime President Hans T. Sy said.
Rental revenues from retail and commercial spaces accounted for more than half of the consolidated revenues, recording a 10-percent gain to P19.4 billion, from P17.7 billion last year.
The growth in rental revenues was mainly driven by rising contribution from the new malls and the expansion of shopping spaces in existing malls in 2013 and 2014 that added a total gross floor area of 652,000 square meters.
Growth was also propelled by the increase in SM Prime’s office spaces, while same-store rental remained at 7 percent, sustaining the growth posted in 2014. SM Prime’s real-estate sales, which contributed 34 percent to consolidated revenues, went up by 3 percent to P12.3 billion from P11.9 billion in the same period last year. This allowed the group to post an 8-percent increase in net income from the group to P3 billion.
Growth was primarily due to the increase in the sales take-up and higher construction accomplishment of projects launched in 2010 to 2013 in Tagaytay, Manila, Taguig, Pasay and Quezon City. The housing group’s reservation sales grew by 24 percent year-on-year to 6,868 units in the first half of 2015, translating to a 28-percent increase in value worth P18.8 billion from P14.7 billion last year.
Cinema and event ticket sales, accounting for 6 percent of consolidated revenues, recovered in the second quarter, registering a 7-percent year-on-year increase to P1.4 billion, as compared to a decline of 8 percent to almost P1 billion in the previous quarter.
This brought cinema and event ticket sales to P2.4 billion in the first half of 2015, flat from the same period last year. Meanwhile, consolidated costs on real estate declined 1 percent to P6.7 billion compared with last year’s P6.8 billion.
In the first half of the 2015, SM Prime opened Megacenter Cabanatuan and SM City San Mateo in April and May, respectively, bringing the total Philippine operating malls to 52 with a gross floor area of almost 6.6 million square meters.