Malls make more for SM Prime
Revenues from new shopping centres drove a 12 per cent third quarter boost in net income for Filipino property developer SM Prime.
The diversified property conglomerate, and the largest shopping centre operator in the Philippines, says its third quarter sales growth was the same as for the first half. Third quarter profit was PHP 3.7 billion (US$92.5 million)
Rental revenues from retail and commercial space grew by 11 per cent to P26.4 billion, accounting for 55 per cent of the company’s total revenues.
Management attributed the increase in rental revenue mostly to the new malls that opened and the expansion of existing malls in 2013 and 2014, namely, SM Aura Premier, SM City BF Parañaque, Mega Fashion Hall in SM Megamall, and SM City Cauayan, with a combined total gross floor area of 527,000sqm
Part of the growth also came from TwoE-com Center in Mall of Asia Complex which opened in 2013 and is now fully occupied. Meanwhile, same-store rental grew by seven per cent, sustaining the growth posted in the first half of the year.
Amusement and other revenues increased by seven per cent in the third quarter to Php623 million, and by 20 per cent in the first nine months of 2014 to Php2.1 billion. The company said the increase was mainly due to the strong patronage of amusement rides and additional recreational facilities provided by management in various malls.
The growth of SM Prime’s consolidated costs and expenses was benign with an increase of only five per cent to Php27.7 billion in nine months of 2014. The bulk of the increase came from depreciation expenses attributed to new malls added in the past 12 months. Film rentals were also higher as it corresponded to the growth in cinema ticket sales.
SM Prime capital expenditure this calendar year is Php60 billion, of which Php30 is for mall development.