SM Prime Holdings Inc., one of Southeast Asia’s biggest integrated property developers, is issuing up to P60 billion worth of bonds with an initial tranche of up to P10 billion in fixed rate retail bonds.
 
In a disclosure to the Philippine Stock Exchange, the firm said that that its Board of Directors approved the offering to the public of up to P60 billion worth of bonds.
 
The bonds will be filed under a shelf registration to be issued for a period of three years, with an initial offering of up to P5 billion with an over subscription option of up to P5 billion worth of Fixed rate bonds, with maturity of 10 years (the Series “F” Bonds).
 
SM Prime said its board of directors also authorized the management to negotiate and finalize the terms and conditions, including pricing, tenor and any increase in issuance amount, and execute any and all documents necessary, to implement the retail bond issue.
 
The firm earlier reported a 12 percent growth in core net income the first quarter of 2016 to P5.8 billion while consolidated revenues rose 10 percent to P18.2 billion.
 
“SM Prime’s massive expansion last year propelled our performance this quarter. Our strong balance sheet coupled with consistent recurring revenue and income should allow us to pursue our growth plans this year and in the medium term,” said SM Prime president Hans T. Sy.
 
In the first quarter of the year, mall revenues surged 11 percent to P11.0 billion from P9.9 billion in the same period of 2015. Mall revenue alone accounted to 60 percent of SM Prime’s consolidated revenue, for which 85 percent of it comes from rental income.
 
Growth was largely driven by new malls and expansion of existing malls in 2015. Excluding the new malls and expansions, same-store growth averaged 7 percent.
 
To date, SM Prime has a total of 57 malls in the Philippines and six in China with total retail space of 8.4 million sqm.
 
SM Prime’s residential group, which contributed 32 percent of consolidated revenues, posted revenues of P5.8 billion in the period being reviewed, up 5 percent.
 
The increase can be traced by the higher construction accomplishments of SM Development Corporation (SMDC) projects launched in 2013 to 2015.