SM Prime profits hold steady in first half of 2026

SM Prime Holdings Inc., the property arm of the Sy family’s SM Investments Corp., posted flat earnings in the first half of 2026 as higher costs offset revenue growth.

In a disclosure to the Philippine Stock Exchange, SM Prime reported a net income of ₱24.5 billion, unchanged from a year earlier, “as costs and expenses eclipsed revenue growth.”

Total revenues rose 5% to ₱71.7 billion from ₱68 billion a year ago, with rental income from malls, offices, hotels and convention centers accounting for 61% of the total.

Real estate sales contributed 27%, while cinema ticket sales, food and beverage, amusement and related businesses accounted for the remaining 12%.

The Sy-led property developer said costs and expenses increased nearly 6% to ₱35.6 billion from ₱33.6 billion, driven by higher depreciation and amortization charges, fixed overhead costs and construction expenses.

“Our focus on tenant relationships, customer experience and cost management supported our performance. Despite challenging market conditions, commercial demand remained resilient across our portfolio,” SM Prime President Jeffrey Lim said.

Mall revenues grew 8% to ₱41.8 billion from ₱38.6 billion, supported by higher occupancy, stronger tenant sales and improved operational efficiency.

Residential revenues, covering the company’s core, leisure and premium offerings, slipped 1% to ₱20.6 billion from ₱20.9 billion due to lower revenue recognition from prior-year sales.

According to the company, revenues from hotels and convention centers grew 8% to ₱4.4 billion from ₱4.1 billion, driven by higher bookings and average daily room rates.

Office and warehouse revenues rose 9% to ₱5 billion from ₱4.6 billion, driven by higher space take-up.

In the second quarter alone, SM Prime said consolidated net income edged up 1% to nearly ₱12.9 billion from ₱12.8 billion as costs grew in line with revenues.

Total revenues from April to June increased 9% to ₱38.4 billion from ₱35.3 billion, SM Prime said.

Costs and expenses, meanwhile, rose nearly 9% to ₱19 billion from ₱17.5 billion, mainly due to higher construction costs.

As of June 2026, SM Prime’s total assets stood at ₱1.1 trillion. — MCG, GMA News