Nov. 16 (Bloomberg) — SM Investments Corp., the holding company of Philippine billionaire Henry Sy, will post a record profit this year as its retail, property, shopping mall and bank units grabbed market share amidst a slowing economy.

Net income may reach 15.5 billion pesos ($333 million) while sales may rise to 150 billion pesos, Chief Financial Officer Jose Sio said in an interview in Manila today. The company earned a 14-billion peso profit in 2008 on 132.5 billion pesos of revenue.

“SM thrives and emerges stronger in times of crisis,” Sio said. “Our units were able to increase their market shares even with the slowdown because of strong balance sheet and goodwill with customers.”

The Philippine government forecast economic growth of between 0.8 percent and 1.8 percent this year, slower than the 4.6 percent expansion in 2008 as the global recession cut demand for exports and trimmed the growth in funds sent home by overseas Filipinos. Repatriated funds make up 10 percent of the $167 billion economy, and help finance domestic spending.

“More than half of what a typical consumer spends is potentially captured by SM’s malls and retail shops,” said Gilbert Lopez, analyst at Credit Suisse Group AG. He has an “outperform” rating on the stock. “Its share of Filipinos’ wallets can grow further as it expands its property ventures.”

Nine-Month Profit Jump

SM Investments said today that nine-month profit rose 14 percent to 10.8 billion pesos, while sales increased 14 percent to 110.9 billion pesos. Profit at its retail ventures, which contributed 81 percent of total sales, grew 37 percent to 3.1 billion pesos.

SM Investments, which owns the nation’s biggest bank and shopping mall operator, plans capital expenditure of 211.32 billion pesos from 2010 through 2014, according to Sio. Sales and profit are projected to double over that period, he said.

The company will spend 40.6 billion pesos for expansion in 2010, compared with 25 billion pesos this year, Sio said. Shopping mall unit SM Prime Holdings Inc. will spend 12.1 billion pesos to build five Philippine malls and one shopping center in China.

SM Prime is scheduled to open its 36th Philippine mall this month while SM Investments plans to add eight more outlets before the end of the year to its network of 111 department stores, supermarkets, convenience stores and hypermarkets.

SM Investments is budgeting 17.4 billion pesos to build more homes and residential towers next year, Sio said. The company’s real estate ventures will contribute about 20 percent of profit by 2014, compared with 12 percent in the nine months to end-September 2009, he said.

SM Prime will build one mall a year in China until 2012 before accelerating the pace of expansion, Jeffrey Lim, the unit’s chief financial officer said. China, where SM Prime owns three malls now, will contribute 5 percent to 7 percent of the company’s profit by end 2012, he said.

To contact the reporter on this story: Ian C. Sayson in Manila at [email protected]