SY-LED mall developer and operator SM Prime Holdings, Inc. saw profits grow by double-digit rate last quarter, sustaining strong expansion through the nine months to September, according to the company’s latest financial report that was attached to its disclosure yesterday.

SM Prime’s net income rose 12.45% to P2.89 billion in the July-September period from P2.57 billion in the same three months last year, while net income attributable to equity holders of the parent jumped 12.5% to P2.79 billion from P2.48 billion.

In the same comparative periods, revenues — mainly from rent — climbed 9.31% to P8.22 billion from P7.52 billion, while cost and expenses increased by 9.59% to P4 billion from P3.65 billion.

The company’s latest three-month performance brought profits to P8.73 billion in the nine months to September, 13.38% more than the previous year’s P7.7 billion.

In a statement attached to a separate disclosure yesterday, the company said its net income attributable to equity holders of the parent rose 14% to P8.43 billion during the nine-month period from P7.40 billion in the same period last year.

MAIN DRIVER

Gross revenues climbed 12% to P24.77 billion from P22.10 billion, driven by a 12% annual jump in rental revenues — which account for 85% of total revenues — to P20.94 billion.

According to SM Prime, the growth in revenues was fueled largely by rent at new malls that opened in 2012 and 2013, identified as SM City Olongapo in Zambales; SM City Consolacion in Cebu; SM City San Fernando in Pampanga; SM City General Santos in South Cotabato; SM Lanang Premier in Davao City; and SM Aura Premier in Bonifacio Global City.

These malls have a total gross floor area of 698,000 square meters (sq.m.), SM Prime said.

Excluding the new malls and expansions, SM Prime’s “same-store” sales — referring to revenues from stores operating for at least a year — grew 7% annually in the nine-month period, the company added.

Cost and expenses in the same comparative periods, meanwhile, grew by 12.06% to P11.71 billion from P10.45 billion.

SEASONAL BOOST

“We continue to exceed our expectations. We expect to sustain our strong performance as we approach the yearend especially as the Christmas season has been, traditionally, our strongest period,” a separate statement quoted SM Prime President Hans T. Sy as saying.

“Our robust performance in the nine months of 2013 is a testament to the strength of consumption driven by the increase in OFW (overseas Filipino workers) remittances and the continued growth of the BPO (business process outsourcing) industry.”

SM Prime’s five malls in China contributed P2.17 billion in gross revenues from January to September, accounting for 9% of the company’s total consolidated revenues in that period.

Foreign operations contributed 10% to the total consolidated rental revenues.

“Gross revenues of the five malls in China increased 14% in 2013 largely due to improved mall productivity and lease renewals for the first three malls opened, namely: SM Xiamen, SM Jinjiang and SM Chengdu,” the statement read.

“Average occupancy rate for the first three malls is at 93%,” it added.

Together with the two other malls — located in the cities of Suzhou and Chongqing — the malls in China have a total gross floor area of around 800,000 sq.m., SM Prime said.

Locally, SM Prime has a total of 47 super malls nationwide with a total gross floor area of about six million sq.m.

SM Prime said in its statement that it will continue to expand its presence in the country with the scheduled launch of SM City BF in Parañaque City and the opening of SM Megamall’s Building D.

“Both projects will be opened to the public in November and December 2013, respectively,” the company said.

“By yearend, SM Prime will have 48 malls in the Philippines and five in China with an estimated combined gross floor area of seven million sq.m.”

CLEARANCE

SM Prime also cited in its statement that it bagged last Oct. 10 the approval of the Securities and Exchange Commission (SEC) for its merger with SM Land, Inc.

The corporate regulator also cleared the developer’s doubling of authorized capital stock to P40 billion from P20 billion and issuance of common shares for acquisition of real estate companies and properties held by SM Investments Corp. through share swap arrangement.

The merger was set in motion after SM Land — a privately held company of the Sy family — acquired condominium builder SM Development Corp. and leisure property developer Highlands Prime, Inc. last quarter.

“We are grateful to the SEC for its support of the property merger. 

Having received this very important approval, we can now move forward and work towards achieving our vision of building an integrated property development company that will rank among the best in the region not only in size but also in quality and innovativeness of product offering,” Mr. Sy said in the same statement.

SM Prime was incorporated in 1994 to develop, operate and maintain SM group’s commercial shopping centers and related businesses, according to information on the Web site of the Philippine Stock Exchange.

Shares of the firm gained 10 centavos or 0.52% to close at P19.28 apiece yesterday from P19.18 each on Thursday last week. Financial markets were closed on Friday in observance of All Saints’ Day. — Claire-Ann Marie C. Feliciano