SM Investments profit hits P16B on strong consumer spending
MANILA - Philippine conglomerate SM Investments Corp posted a 16 percent climb in quarterly net profit as robust domestic consumption fuelled growth in its main revenue drivers banking, mall and retail operations.
SM, owned by the country's richest man, Henry Sy, said on Thursday it had net income of P16 billion ($390 million) in January to September, rising 14 percent from P14 billion a year earlier.
That meant SM had net income of P5.2 billion in the third quarter, up 16 percent from a year ago, if its first half net profit is taken out, according to Reuters calculations.
The company, with a market value of $12 billion, did not give a breakdown of results for third quarter alone. No consensus estimate for the period was available for SM as most analysts in the Philippines do not forecast quarterly earnings.
SM owns SM Prime Holdings Inc , owner and operator of malls in the Philippines and China. It also has interests in lenders Banco de Oro Unibank Inc and China Banking Corp, property firm SM Development Corp and gaming firm Belle Corp.
The group is benefitting from strong private and public consumption and steady inflows of remittances from overseas Filipino workers that is fuelling domestic growth, with the Philippines one of Southeast Asia's fastest growing economies this year.
The country, along with Thailand and Singapore, are leading the rise in Asian equities markets this year as investors focus on domestic-oriented economies, based on Thomson Reuters data.
Revenue in January to September grew 13 percent to P157.9 billion. The group's sales are often used by some analysts as a barometer of domestic spending.
Banks accounted for more than a third of the group's total net income, and retail operations via its flagship SM department stores, supermarkets and hypermarkets made up nearly a fourth.
With the Christmas season traditionally the strongest period for SM, the company is confident it would hit its target of 12-14 percent net income growth this year, Harley Sy, company president said in a statement.
Shares in SM Investments were largely flat in early trade, mirroring the broader market. The results were announced shortly before the market opened. The stock is up 37 percent so far this year, aiding the broader market's 25 percent gain.