SMIC hikes pro t to P18.4 B in Q1

Eyes $3 B from offshore bond market

SM Investments Corp. (SMIC), the investment holding company of the Sy family, enjoyed higher profit in the first quarter as the group benefitted from the country’s underlying economic growth.

SMIC saw its net income rise by six percent to P18.4 billion during the quarter from P17.3 billion in the same period last year.

From January to March, the company generated revenues of P144 billion, up by four percent from P138.3 billion in the same period in 2023.

“We continue to benefit from the country’s underlying economic growth and we adapt to reflect consumers’ evolving spending habits and priorities,” SMIC president and CEO Frederic DyBuncio said.

To support the company’s expansion in the coming years, SMIC and SM Prime Holdings Inc. announced yesterday the establishment of a $3-billion multi-issuer European Medium Term Note (EMTN) program.

Jointly established by SMIC’s wholly owned subsidiary SMIC SG Holdings Pte. Ltd. and SM Prime’s wholly owned subsidiary SMPHI SG Holdings Pte. Ltd., the EMTN program will allow the companies to tap the offshore bond market to fund their continued growth and expansion.

EMTNs are debt securities issued and traded internationally.

With the company on its continuous expansion mode, SMIC senior vice president for finance Franklin Gomez earlier said they would always be in need of financing.

“So it’s just a way for us to expand the portfolio of our sources so we have the ability to fully fund our expansion that we want to achieve,” Gomez said referring to the EMTN program.

SMIC is one of the leading Philippine companies that is invested in market-leading businesses in retail, banking and property. It also invests in ventures that capture high growth opportunities in the emerging Philippine economy.

For the three-month period, banking accounted for 52 percent of reported net earnings from core businesses, followed by property at 29 percent, retail at 12 percent and portfolio investments at seven percent.

Sustained performance of their core businesses allowed BDO Unibank Inc. to post a 12-percent jump in net income during the quarter to P18.5 billion and China Banking Corp. with an 18-percent net income growth to P5.9 billion.

For its property business, SM Prime Holdings Inc. booked a net income of P10.5 billion, 11 percent higher year-on-year as revenues expanded by seven percent to P30.7 billion.

Revenues by the mall business, the primary residential business group, as well as other business segments composed of offices, hotels and convention centers all registered year-on-year growth.

SM Retail’s net income, however, dropped to P3.1 billion from P3.9 billion in the first quarter last year despite revenues improving by three percent to P93.8 billion.

SMIC said portfolio investments’ net income in the first quarter was driven by Atlas Mining and the NEO Group.

It expects the portfolio businesses to make a larger contribution to the group’s revenues and earnings over time.

“Looking ahead, our outlook remains cautiously optimistic and our expansion is on track,” DyBuncio said.

For this year, SMIC is spending up to P115 billion for the continuing expansion of its various businesses.

The biggest component of the capex this year is SM Prime, which is looking at P100 billion capital spending to support various programs.

SM Prime said it remains committed to its role as a catalyst for economic growth by delivering innovative and sustainable lifestyle cities that enriches the quality of life of millions of people.

Overall, SM said there are still many areas in the country which have yet to benefit from access to modern retailing, formal financial services and integrated property developments.

“Our strategy is to continue to expand coverage nationwide to create new markets that improve access to these sectors,” DyBuncio said.