SM group’s shopping mall and housing arm is confident of meeting its full-year target after sustaining growth in the second quarter with a rise in consolidated net profit of 12% year on year to P5.22 billion.

SM Prime Holdings, Inc. added that consolidated revenue during the period rose 11% to P18.08 billion.

“The results were very encouraging as we sustained our growth from the previous quarter. This gives us confidence to meet our full year target. We are looking forward to hitting our key targets for the rest of the year. This should pave the way in achieving our five-year road map set in April of this year,” SM Prime President Hans T. Sy was quoted in a statement as saying.

Mr. Sy was referring to a plan that involves some P400 billion in capital expenditure up to 2018 — to be financed by both internally generated cash and debt — intended to spur the group’s mall and residential property businesses and nearly double the 2013 results of P16.275 billion in net profit and P59.794 billion in revenue.

The road map aims to bring the number of malls to 85 — 74 in the Philippines and 11 in China, from 48 currently; the number of residential projects to 41 from 21; office developments to seven towers from the current three; hotels to 10 from five; and leisure-oriented projects to eight from four currently.

Second-quarter figures bring first-half net profit to P9.8 billion, marking a 12% increase, while revenue for the first six months of the year also rose 7% to P33.42 billion.

Half of SM Prime’s consolidated revenue comes from rent, which rose 13% to P9.11 billion in the second quarter, bringing the first-half total to P17.67 billion, up 12%.

“The increase in rental revenue was primarily due to the new malls opened in 2013 and 2014 plus the shopping spaces added in existing malls, namely: in SM Megamall which contributed an additional 101,000 square meters (sq.m.),” the company said.

“The cumulative mall space added in the past two years was close to 550,000 sq.m., an increase of 8% to 6.57 million sq.m.”

Rental growth on a same-store basis was 7% for both the second quarter and the first half.

Real estate sales, which accounted for 38% of consolidated revenue, rose 9% to P6.89 billion in the second quarter, a reversal of the 17% decline in the first quarter.

“Second-quarter growth was attributed to more projects that were almost completed in the period under review, particularly the Grace and Breeze Residences. SM Prime expects the housing unit group to sustain its growth for the rest of the year as more projects reach completion while new housing projects are lined up for launch over the next 12 months,” the statement read.

SM Investment Corp.’s property business, consolidated last year under SM Prime, consists as well of SM Development Corp.; Highlands Prime, Inc.; Costa del Hamilo, Inc.; Prime Metroestate, Inc.; and SM Hotels and Conventions Corp.

Shares of SM Prime surged 60 centavos or 3.90% to end P16 apiece yesterday from P15.40 each last Friday. — Daphne J. Magturo