SM Prime Holdings is allotting about P38 billion for capital expenditures (capex) over the next five years for the construction and expansion of existing malls in the Philippines and China.

During the firm’s annual stockholders’ meeting yesterday, SM Prime president Hans Sy said capex for the Philippines alone amounts to P33 billion in five years.

Capex for China where the firm has just acquired the malls built by the Sy family for P10.8 billion will amount to about P3 billion to P5 billion as the firm intends to build about 3-5 malls during the next five years at the cost of about P1 billion per mall.

Sy said the firm has earmarked P6 billion for its capital expenditures this year which will be financed by both external borrowings and internally generated funds including retained earnings.

SM Prime’s board of directors also approved yesterday the declaration of a 24 centavo cash dividend per share worth P2.99 billion. This is in line with the company’s dividend policy of 50 percent payout ratio of prior year’s net income which amounted to P5.97 billion in 2007.

This year, the firm is slated to open SM City Marikina, SM City Baliuag, and SM Supercenter Rosales. Also underway are the expansion of SM Megamall, SM City Fairview Annex 3, and SM North EDSA, with the latter to be completed in 2009.

Total gross floor area will increase by 258,000 square meters to 4.2 million square meters by the end of 2008, coming from 3.9 million square meters as of December 31, 2007.

SM Prime chief financial officer Jeffrey Lim that, despite the tough global economic environment as a result of the US subprime crisis, he remains ‘positive over better prospects for the company in 2008.Aside from the revenue and income contributions of the three new malls to be opened this year, Lim said they also expect a further boost from the foling in of the three malls in China whose financials ‘look very encouraging.’

‘We will continue to expand in the Philippines to maintain our leadership in the local market and at the same time explore opportunities in China and in other parts of the region for long term growth strategies,’ he said.

Meanwhile, Sy said preliminary figures for the first quarter of the year shows both revenues and profits still growing although at a slower rate than the 10 percent growth chalked in the same period in 2007.’But its still too early to tell is consumer spending has slowed down during the period because of the seasonality of sales,’ he said explaining that sales usually grow more in the second quarter because of school opening.

‘We should have a clearer picture on how sales are trending when we have figures for the first half of the year,’ Sy said.