SM Prime profit up 7% in Q1

Shopping mall giant SM Prime Holdings Inc. reported a seven-percent growth in net earnings to P1.6 billion from January to March this year on higher revenues from lease operations.

In a statement, SM Prime said gross revenues went up eight percent to P3.8 billion due to additional revenues brought in by three new malls opened last year — SM City Bacolod, SM City Taytay and SM Supercenter Muntinlupa.

Rental revenues, accounting for 85 percent of total revenues, grew 10 percent to P3.3 billion.  Same store rental growth was at five percent despite the ongoing redevelopment plan in SM Megamall and SM North Edsa.

Earning before interest, taxes, depreciation and amortization (EBITDA) amounted to P2.9 billion, up nine percent from the previous level while operating income also improved nine percent to P2.2 billion due to cost-saving measures implemented in the malls. 

SM Prime said the absence of blockbuster movies shown during the period under review resulted in flat growth for cinema ticket sales.

Operating expenses increased six percent to P1.6 billion due to new store openings.

Commenting on the steady strong performance of the company, SM Prime president Hans T. Sy said:  ”SM Prime continued to exhibit growth in the first quarter amid a more challenging environment, as we stay focused on making SM malls an exciting place to shop, dine and spend time with family and friends. As such, we are moving ahead with our expansion program as planned.”  

SM Prime is slated to open SM City Marikina in Metro Manila, SM City Baliuag in Bulacan and SM Supercenter Rosales in Pangasinan this year. 

Malls undergoing expansion include SM Megamall and SM City Fairview. 

With all these new store openings and expansion in place, SM Prime’s total number of malls and gross floor area will increase to 33 and  4.2 million square meters, respectively, by the end of 2008.