SM Prime posts 8% profit hike to P4.2B in 2003

SM Prime Holdings Inc., the country’s leading shopping mall developer and operator, reported an eight-percent increase in its net income last year to P4.2 billion, from the previous year’s earnings of P3.86 billion.

Consolidated revenues went up by 10 percent to P8.8 billion from P8.01 billion, largely due to higher mall and food court lease revenues. Of the total, tenant rental revenues accounted for P6.98 billion, or an increase or 11 percent from P6.27 billion in 2002.

Revenues from its cinema operations likewise went on the upswing, rising seven percent to P1.34 billion.

Also contributing to the revenue upsurge were the full operations of SM City-Bicutan and SM City-Cagayan de Oro, which were opened in the last quarter of 2002.

SM Prime said the newly-opened SM City-Lucena, SM City- Baguio and SM City-Marilao, which all opened in late 2003, likewise contributed to the improvement in revenues.

Net earnings from other income sources surged 91 percent due to higher interest income brought about by higher average cash balance during the period under review, and the decline in interest expense due to lower average balance of loans and long-term debt.

The company’s operating expenses, meanwhile, grew 10 percent mainly due to the operational costs of the three newly-opened malls and the full operations of its malls in Bicutan and Cagayan de Oro.

Located only a kilometer from the city proper, SM City -Lucena has three levels and total gross floor area of 72,057 square meters of shopping, entertainment and dining that is already 90 percent leased out.

SM City-Baguio, on the other hand, is located on Session Road at the heart of Baguio City. Its gross floor area of 105,331 sqm. is already 90 percent lease-awarded.

SM City-Marilao caters to residents of Obando, Meycauayan, Sta. Maria and Bocaue - where the population is large and fast growing due to the industrial estates being developed in these areas. The two-storey 88,654 sq.m. mall is already 90 percent leased out.

With the opening of these malls, SM Prime now owns 17 operational shopping centers across Luzon, Visayas, and Mindanao with total gross floor area totaling 2.31 million square meters.

SM Prime has a total landbank of 94 hectares in 16 strategic locations, enough for its continuous expansion within the next five years. Set to open this year are SM City- Dasmarinas in Cavite, SM City Batangas and SM City Fairview Annex.

Currently under construction are SM City-San Lazaro, SM City Molino, SM City Valenzuela and the Mall of Asia, the biggest of its kind in Asia.