SM Prime Boosts Profit 33% to PHP 40B in 2023

SM Prime posts record profit for 2023

SM Prime Holdings, Inc. posted a record consolidated net income of PHP 40 billion, which is a 33% jump from 2022.

The company’s revenues also increased 21% to PHP 128.1 billion, according to a report by SM Prime President Jeffrey Lim at the company’s recent annual meeting of stockholders. “2023 was the result of how well we managed our challenges from the uncertainties of the pandemic years,” Lim said.

SM Prime’s mall business, which accounts for 56% of its consolidated revenues, posted 30% growth and reached PHP 71.9 billion last year, driven by a 24% increase in mall rental income amounting to PHP 61.3 billion. The company opened several new malls last year, including SM City Bataan in Bataan Province, SM Center San Pedro in Laguna, and SM City Sto. Tomas in Batangas.

SM Prime’s residential business group, led by SM Development Corporation (SMDC), recorded a growth of 8% in revenue to PHP 43.1 billion in 2023. The residential group’s gross profit rose by 15% to PHP25.4 billion, while reservation sales stood at PHP102 billion. SMDC accounts for 34% of SM Prime’s consolidated revenues, according to Lim.

Lim further outlined that SM Prime is earmarking PHP 100 billion in capital expenditures “aimed at fostering shared prosperity and inclusive growth in every city within our purview.” Regarding its allocation, he said 40% will be directed towards acquiring new properties and reclamation developments, while 60% will be dedicated to enhancing our malls, development of new residential properties under SMDC, and construction of new hotels and convention centers.

SM Prime’s other key business segments, which include offices, hotels, and convention centers, made up 10% of its consolidated revenues, posting PHP 13.1 billion in revenues in 2023, a 26% increase from the previous year. The company’s office unit posted PHP 6.8 billion in revenues, while its hotels and convention centers unit reached PHP 6.3 billion in revenues last year, Lim continued.

Lim highlighted that SM Prime proactively invests in initiatives aimed at mitigating disaster risks. For the company’s construction practices, it allocates 10% of the expenditure for each property “toward sustainable and resilient design initiatives”, he said.

Further, SM Prime’s board approved cash dividends of PHP 0.346 per share, amounting to a total of approximately PHP 10.0 billion Pesos in favor of all stockholders of record as of May 8, payable on May 22.

SM Prime describes itself as one of the largest integrated property developers in Southeast Asia and the largest one in the Philippines in terms of assets. It offers innovative and sustainable lifestyle cities through the development of malls, residences, offices, hotels and convention centers.

SM Prime, which was incorporated in the Philippines in 1994, started as a mall developer and operator and grew to be the biggest retail shopping center developer and operator in the Philippines, according to the company’s website. Currently, it has 85 malls in and outside Metro Manila and eight shopping malls in China, totaling 10.8 million square meters of gross floor area. The company has 20,615 tenants in the Philippines and 2,183 tenants in China.

SM Store, the retail unit of the entire SM Group, recently unveiled its Green Finds pop-ups in premier locations, its latest effort to support and promote sustainable businesses.