SM Investments (SM) Q3 2024 earnings summary

Executive summary

• Consolidated earnings grew, with banking contributing 50% of net income and portfolio investments 8%.

• Net income attributable to owners rose 9% year-over-year to P60.9B on revenues of P462.5B, up 5% for the nine months ended September 30, 2024.

• Retail contributed 66% of revenues but only 15% of net income, while property delivered 27% of net income with strong growth in malls and residential sales.

• Food retailing benefited from volume growth and store expansion, while property growth was led by malls.

• Conservative gearing and a strong balance sheet maintained, with positive outlook amid easing inflation.

Financial highlights

• Consolidated revenues reached PHP 462.5B, up 5% year-over-year; net income at PHP 60.9B, up 9%.

• EBITDA rose 6.6% to P128.4B; operating margin at 23.6%, net margin at 18.2%.

• Total assets grew 4.2% to P1,652.1B; equity up 9.1% to P842.7B.

• Earnings per share (EPS) for nine months at P49.83, up from P45.73 year-over-year.

• Net debt to total equity ratio at 32:68.

Outlook and guidance

• Group remains positive on outlook, supported by easing inflation and continued growth in core businesses.

• Continued expansion in retail (new stores, especially Alfamart), property (new malls, landbanking), and investments in new ventures.

• Funding for expansion to come from operations and capital raising (bonds, debt).