SM Prime sees double-digit top line growth

MANILA, Philippines - SM Prime Holdings Inc., the country’s largest shopping mall developer, expects a double-digit growth in its top line for the first half of the year, driven by new mall openings.

On the sidelines of Highlands Prime Inc.’s annual stockholders meeting yesterday, SM Prime president Hans Sy said the shopping mall operator had a good second quarter, boosting its first half financial results. “The addition of new branches definitely helped us sustain strong revenues,” he said.

He said the company increased its market share with more people trooping to their department stores to shop despite a tough business environment. “People adjusted their buying habits and shopped in our department stores,” he said.

In the first quarter this year, SM Prime reported a seven percent hike in consolidated net profit to P1.7 billion from P1.6 billion the previous year. Consolidated revenues rose 18 percent to P4.7.

The company’s first quarter results include the operations of the three SM malls in China – located in the cities of Xiamen and Jinjiang in Southern China, and Chengdu in Central China.

SM Naga in Camarines Sur opened its doors to the public in May, the first mall to be opened by SM Prime for the year and its first in the Bicol region. 

For the rest of the year, SM Prime is opening two more malls – SM City Pamplona in Las Piñas (targeted to be operational in October) and SM Rosario in November as well as the expansion phase of SM City Rosales in Pangasinan. 

By yearend, the company’s shopping mall network is expected to reach 36 with an estimated total gross floor area of 4.9 million square meters.

SM Prime is also looking at building a mall in Tarlac, San Pablo and Calamba in Laguna and Commonwealth.

SM Prime has earmarked P12 billion in capital expenditures this year, P6.5 billion of which will be used to expand its operations domestically while the balance of P5.5 billion will go to its expansion in China.

Three new malls in China – Chonggqing, Suzhou, and Zibo – are targeted for opening between 2010 and 2012. This will add to its three existing malls in the mainland.

Suzhou, with a gross floor area of 73,000 sqm., is under construction and is expected to open in early 2010. While Zibo and Chongqing, which has the biggest population in China, are scheduled to open in 2011 and 2012.