SM Prime Holdings, Inc., the country’s leading shopping mall developer and operator, reported a net income of Php1.6 billion in the first quarter of 2008, up 7% year-on-year on higher rental revenues.

The income growth is slower than the 11 percent posted in the first quarter of 2007 against the 2006 level.

SM Prime said in a disclosure to the stock exchange that gross revenues in the first three months rose 8 percent to Php3.8 billion as rental revenues expanded following the opening of three new malls in 2007, namely SM City Bacolod, SM City Taytay, and SM Supercenter Muntinlupa.

Rental revenues in the first quarter of the year climbed 10 percent to P3.3 billion, accounting for 85 percent of the total revenues. 
 
Same store rental growth was at 5 percent despite the ongoing redevelopment plan in SM Megamall and SM North Edsa.

The absence of blockbuster movies shown during the period, meanwhile, resulted in a flat growth for cinema ticket sales.

Operating expenses increased by 6% to Php1.6 billion due to the construction of new malls.

�?SMPH continued to exhibit growth in the first quarter amid a more challenging environment, as we stay focused on making SM malls an exciting place to shop, dine and spend time with family and friends. As such, we are moving ahead with our expansion program as planned,�?  said SM Prime President Mr. Hans T. Sy.

The company this year is set to open SM City Marikina, SM City Baliuag in Bulacan, and SM Supercenter Rosales in Pangasinan, increasing the total number of malls to 33.