investor kit 2019 · presentation is or should be relied upon as a promise or representation as to...

Malls

Investor Kit 2020This presentation is available online through www.smprime.com

https://smprime.com

Disclaimer

This presentation does not constitute a prospectus or other offering memorandum in whole or in part. This presentation does not constitute an offer to sell or the

solicitation of an offer to buy any securities of the Company. There shall be no sale of these securities in any state or jurisdiction in which such offer, solicitation or sale

would be unlawful prior to any qualification under the securities laws of such state or jurisdiction. This presentation has not been and will not be reviewed or approved by

any statutory or regulatory authority or any stock exchange in the Philippines or elsewhere. Prospective investors should undertake their own assessment with regard to

their investment and they should obtain independent advice on any such investment’s suitability, inherent risks and merits and any tax, legal and accounting implications

which it may have for them.

This presentation contains statements about future events and expectations that constitute “forward-looking statements.” These forward-looking statements include

words or phrases such as the Company or its management “believes”, “expects”, “anticipates”, “intends”, “may”, “plans”, “foresees”, “targets”, “aims” “would”, “could” or

other words or phrases of similar import. Similarly, statements that describe the Company's objectives, plans or goals are also forward-looking statements. All such

forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by the

relevant forward-looking statement. Such forward-looking statements are made based on management’s current expectations or beliefs as well as assumptions made by,

and information currently available to, management. These forward-looking statements speak only as at the date of this presentation and nothing contained in this

presentation is or should be relied upon as a promise or representation as to the future.

This presentation and the contents hereof are for the exclusive use of the intended recipient(s). This presentation and the contents hereof should not be (i) forwarded or

delivered or transmitted in any manner whatsoever, to any other person other than the intended recipient(s); or (ii) reproduced in any manner whatsoever. Any

forwarding, distribution or reproduction of this presentation in whole or in part is unauthorized. This presentation must not be distributed to the press or any media

organization. By accepting this presentation, the recipient agrees to keep confidential at all times information contained in or made available in connection with this

presentation.

Neither the Company nor its advisor, nor any of their respective affiliates, shareholders, directors, employees, agents or advisers makes any expressed or implied

representations or warranties as to the accuracy and completeness of the information contained herein or any other information (whether communicated in written or oral

form) and each of the foregoing parties expressly disclaims any and all responsibility and liability of any kind (including any contractual, non-contractual, or third party

liability) for any loss or damage, whether or not arising from any error or omission in compiling such information or as a result of any party’s reliance or use of such

information. The information in this presentation has not been independently verified. The information and opinions in this presentation are subject to change without

notice, and no obligation is assumed by the Company nor its advisor, nor any of their respective affiliates, shareholders, directors, employees, agents or advisers to

provide the recipient(s) with access to any additional information or to update this presentation or to correct any inaccuracies in it which may become apparent.

Investor Kit 20202

OutlineI. Company Profile

II. 1H2020 Highlights

III. COVID-19 Response

IV. Sustainability

• Four Sustainability Pillars

• SM Prime’s Path to

Sustainable Development

V. The Company• Key Business Units

• Malls

• Residences

• Offices

• Hotels & Convention Centers

VI. Key Strategies• Key Strategies

• Landbank

• Capex Program

VII. Financial Highlights

VIII. Investment HighlightsInvestor Kit 20203

Company Profile

▶ One of the leading retail landlords in

Southeast Asia

▶ One of the largest listed real estate

developers on the PSE by market

capitalization and net income

▶ Consistently cited for excellence

in corporate governance, property

development, environmental

consciousness, and investor relations

programs

Investor Kit 20204

Market Capitalization

PSE Stock Symbol SMPH

Market Capitalization PHP880bn

Outstanding Shares 28,879mn

Last Traded Price

(July 30, 2020) Php30.00/share

Average Daily

Turnover (YTD) US$9.34mn

US$17.89bn

1H2020 Financial Highlights

Investor Kit 20205

► Consolidated net income of PHP10.4 billion, down by 46% from PHP19.3 billion in

1H2020

► Consolidated revenue is PHP43.7 billion, 23% lower than PHP57.0 of the same period

► Revenue Contribution: Mall business accounts for 38%, Residences accounts for 54%,

Other Business accounts for 8%

► Philippine malls revenues recorded PHP14.4 billion, 49% down from PHP28.1

billion of the same period last year.

► Philippine mall rental income registered PHP13.1 billion, 44% lesser from last

year’s PHP23.3 billion.

► Residential group, led by SM Development Corporation (SMDC), recorded a 11%

increase in revenue to PHP23.7 billion from PHP21.4 billion in 1H2020

► SMDC’s reservation sales amounted to PHP42.4 billion in the first half of 2020

► SM Prime’s other business segments reported a consolidated revenue of PHP3.6

billion in the first six months of the year.

►Operating income of Other Business recorded PHP1.9 billion, 21% down from

PHP2.3 billion of the same period last year.

COVID-19 Response

Investor Kit 2020

1.Through SM Foundation:

• Donated PHP300 million worth of PPEs, medical

equipment, and facilities to meet the needs of

some 150 hospitals and health facilities

nationwide.

• Donated seven emergency quarantine facilities

(EQFs) built by SM EDD (SM Engineering,

Design, and Development)

2. PHP100 million donated to poor communities

through Project Ugnayan

3. Additional PHP6.6 million assistance to hardest-hit

communities through SM Supermalls

4.Converted SM Mall of Asia Arena into a Mega

Swabbing Facility.

SM’s Donations to Health Workers

Emergency Quarantine Facilities (EQF)

Conrad Manila delivers meals to PGH’s front-liners

MEDICAL COMMUNITY: Extending a helping hand

COVID-19 Response

6

Investor Kit 2020

Deployment of Sanitary Team in SM Supermalls

While observing proper safety protocols, SM Prime

properties continued to serve its customers.

1. All 74 SM malls in the Philippines have been gradually reopened

starting May 16 to provide basic needs and essential services.

2. SM Development Corp. (SMDC) rolled out The Good Guys

Market in select developments to provide its residents

convenient access to fresh produce from farmers of SM

Foundation's Kabalikat Sa Kabuhayan (KSK) program. Also

hosted online mental wellness Meet and Chat for the residents.

3. The SM Leisure Resort Residences (SMLRR)’ Tagaytay

Highlands and Hamilo Coast kept a skeleton workforce to

ensure health and safety in the exclusive properties

4. The Commercial Property Group (CPG) operated on an

optimum level serving BPO tenants

5. The Hotels and Conventions Group remained open for

accommodation needs of BPO employees and returning OFWs

required to observe quarantine

6. SM Malls extended dining areas around the mall with assigned

sanitation team ensure safety of the diners.

7. Partnered with local farmers and public transportation groups to

supply produce and transport people and goods conveniently.

8. Promoted cashless transactions through partner payment portals.

Deployment of Sanitary Teams in SMDC Residences

SM Leisure Residences front-liners

CUSTOMERS: We continue to serve

COVID-19 Response

7

Investor Kit 20208

Intensified safety protocols in SM Hotels

1. Waived PHP11 billion worth of mall

rental fees from March 16 to June 30,

2020.

2. Connected retail tenants and customers

through SM Supermalls Viber

Community. Introduced alternative

delivery/fulfillment options for mall

tenants to serve its customers.

3. Settled obligation to agency personnel

partners, suppliers, and contractors, who

completed their work obligations during

ECQ.

4. SM Hotels and Convention Centers

(SMHCC) Group increased support for

local sourcing, specially SMEs.

Continuous Operation of Essential Stores

BUSINESS PARTNERS: Their success is our success

COVID-19 Response

Social Distancing Protocols in SM Offices

Investor Kit 20209

The Good Guys Market for condo residents

1. Ensured all employees were given their full month's

salaries during the two months of lockdown,

amounting to PHP996 million*

2. Extended financial assistance to those working in

manpower services, amounting to PHP312 million*

3. Implemented the following for employee’s safety

and welfare:

• Rapid antibody testing before returning to

work.

• Provision of facemasks and alcohol

disinfectants

• Digital platform for collaboration

4. Readied the workplace and premises for the ‘new

normal’ – physical distancing marks in common

areas, regular sanitization, foot bath and

temperature checks at entrancesRadisson Blu Cebu Front-liners

SM Life

EMPLOYEES: Our valuable asset

COVID-19 Response

* From March 16 to May 31

EnvironmentSM Prime exists with a sense of responsibility towardsthe environment and believes in the balance withnature. In order to be sustainable, the Company must

practice resilience in its systemsand operations while more publicand private partnershipsstrengthen its commitmenttowards resilient Philippines.

EconomicAs a major driver of the economy, SM Prime observesgood corporate governance to enhance shareholdersupport and remains a catalyst forwell-placed investments.The Company brings more valueto the community through itsmany businesses, which increaseeconomic activity.

Four Sustainability Pillars of SM Prime

CommunityWherever an SM Prime propertyis located, its community isenriched by the SM-institutedplans and programs. Facilities andCSR programs promote inclusivityand cooperation with allstakeholders. SM finds pride in its serviceto the community and the opportunity to improve life for all.

PeopleSM Prime promotes the dynamicgrowth and sustained wellness ofits workforce with developmentalprograms and activities. Theinvaluable contribution of theemployees extends to the

relationships within and beyond the Company. As theCompany grows, so does the employee who adheres toproper principles.

Investor Kit 2020

Environment, Social and Governance

10

Investor Kit 2020

Environment, Social and Governance

11

Key Business Units

► SM Supermalls

► SM Lifestyle, Inc.

► Family

Entertainment

Center Inc.

Investor Kit 202012

Malls

► SM Development

Corp. and

Subsidiaries

► Highlands Prime Inc.

► Costa Del Hamilo

Inc.

Residences

► Offices and

Warehouses

► Mall of Asia

Complex

► Seaside City Cebu

Complex

Commercial

► Radisson Blu

► Taal Vista

► Pico Sands

► Park Inn

► Conrad Manila

► SMX Convention

Centers

Hotels and

Convention Centers

Key Achievements

Investor Kit 202013

0M

2M

4M

6M

8M

10M

12M

2014 2015 2016 2017 2018 2019

China Philippines

Malls (GFA in sqm)

0.8M 0.9M 1.3M 1.3M 1.3M 1.3M

6.5M 7.3M 7.7M 8.0M 8.3M8.5M

7.3M

8.2M9.0M

9.3M9.5M 9.8M

CAGR = 5.03%

0K

20K

40K

60K

80K

100K

120K

140K

2014 2015 2016 2017 2018 2019

Residences (Sold Units)

47.0K

56.3K69.1K

83.7K

102.5K

123.9K

CAGR = 17.53%

0K100K200K300K400K500K600K700K800K

2014 2015 2016 2017 2018 2019

Offices (GFA in sqm)

189K

318K

383K

456K

642K

695K

CAGR = 24.24%

0.0K0.2K0.4K0.6K0.8K1.0K1.2K1.4K1.6K1.8K

2014 2015 2016 2017 2018 2019

Hotels (Rooms)

1,075

CAGR = 9.96%

1,229

1,510 1,5101,522

1,900

At a Glance

Investor Kit 202014

MALLS

1H2020 Operating Highlights

► Total Revenues is PHP16.42 billion, down by 47%

from PHP31.07 billion

► Operating Income is PHP4.98 billion, 71% lower from

PHP17.28 billion in 1H2019

► Total Investment Properties of PHP284.85 billion


► Total Revenues increased by 11%

to PHP23.71 billion from PHP21.43 billion

► Operating Income went up by 17% to PHP9.68 billion


► Total Assets amounted to PHP233.60 billion

RESIDENCES

OFFICES HOTELS AND

CONVENTION CENTERS


► Total Revenues went up by 16% to PHP2.54 billion


► Operating Income went up by 22% to PHP2.22 billion


► Total Investment Properties amounted to PHP52.80

billion


► Total Revenues went down by 55% at PHP1.09 billion


► Operating Loss of PHP0.36 billion

► Total Investment Properties of PHP11.56 billion

At a GlanceLifestyle Cities in Metro Manila

Investor Kit 202015

Caloocan

(North)

Quezon City

Valenzuela

MarikinaCaloocan

MalabonNavotas

ManilaSan Juan

MandaluyongPasig

PaterosMakatiPasay

Parañaque

Las Piñas

Muntinlupa

Taguig

▶ SM Prime has ten (10) integrated property developments in Metro Manila dubbed as Lifestyle City.

▶ SM Prime’s first lifestyle city is Mall of Asia Complex in Pasay City, which spans 60 hectares of

developable area

Metro Manila

► Offices

► Malls

► Residential

► Offices

Megamall (Mandaluyong City)

► Mall

► Residential

SM Aura (Taguig City)

► Mall

► Office

Southmall (Las Pinas City)

► Mall

► Residential

METO MANILA

► Mall

► Residential

North EDSA (Quezon City)

► Mall

► Residential

Sta. Mesa (Quezon City)

► Mall

► Residential

Mall of Asia Complex (Pasay City)

Fairview (Quezon City)

► Hotel

► Convention Centers

► Arena

► Hotel

► Offices

Novaliches (Quezon City)

► Mall

► Residential

Bicutan (Paranaque City)

► Mall

► Residential

Sucat (Paranaque City)

► Mall

► Residential

► Office

► Offices

► Convention Center


Investor Kit 202016

VISAYAS

Seaside (Cebu)

► Mall

► Office

Iloilo City (Iloilo)

► Mall

► Residential

► Office

► Hotel

Bacolod City (Negros Occidental)

► Mall

► Residential

► Hotel (soon)


MINDANAO

Davao City (Davao)

► Mall

► Residential


Cagayan de Oro (Misamis Oriental)

► Mall

► Office

LUZON

Clark (Pampanga)

► Mall

► Office

► Hotel

► Convention Centers (soon)

Marilao (Bulacan)

Olongapo (Zambales)

► Mall

► Convention Centers (soon)

Taytay (Rizal)

► Mall

► Residential

► Office

Sta. Rosa (Laguna)

► Mall

► Office

At a GlanceLifestyle Cities in the Provinces

▶ SM Prime has eleven (11) integrated property developments in key provincial cities in the Philippines.

▶ SM Prime plans to expand its portfolio to other developing cities in the country with its key businesses – mall, residential, offices, hotels and

convention centers.

Zambales Pampanga

Rizal

Laguna

Iloilo

BacolodCebu

Cagayan de Oro

Davao

Trece Martirez (Cavite)

► Mall

► Residential

► Mall

► Residential

Bulacan

Cavite

► Hotel


► Arena

MallsMalls

Revenue

PHP16.42bn

Operating Income

PHP4.98bn

Gross Floor Area

9.8m sqm

Malls

74 in PH & 7 in CH

(as of 1H2020)

MallsMalls

Key Business Units

Investor Kit 2020*As of end 201918

SM Prime is the largest mall operator/developer in the Philippines.

PHILIPPINES*

74

8.5M sqm

18,678

4.4M

340

91,786

CHINA*

7

1.3M sqm

1,829

0.2M

58

15,534

Malls

Total GFA

Tenants

Average Daily

Pedestrian Count

Cinema Screens

Parking Slots

Malls

Total GFA

Tenants

Average Daily

Pedestrian Count

Cinema Screens

Parking Slots

MallsMalls

Key Business Units

Philippine Malls

▶ In terms of GFA, Metro Manila

malls account for 36%, Luzon (ex

NCR) is 32%, Visayas is 11%

and Mindanao is 7%

▶ Average mature mall occupancy

rate is 95%

▶ Accounts for 50% of mall space

in the country

Investor Kit 202019

Philippine Population: 101M

LUZON:

40 Malls

VISAYAS:

6 Malls

MINDANAO

5 Malls

NCR:

23 Malls

MallsMalls

Key Business Units

Mall Coverage in PH

Investor Kit 202020

▶ SMPH malls covered almost all of the key cities in Metro Manila and adjoining towns and municipalities, accounting for 42%

of the company’s total gross floor area in the Philippines.

▶ SMPH mall expansion is geared towards the provinces. The focus is to cover most of Northern Luzon, Visayas and the progressive cities

in Mindanao.

Caloocan (North)

Quezon City

(5 Malls)

Valenzuela

(1 Mall)

Marikina

(1 Mall)

Caloocan

(1 Mall)

MalabonNavotas

Manila

(2 Malls) San Juan

Mandaluyong

(2 Malls) Pasig

(2 Malls)

PaterosMakati

Pasay

(2 Malls)

Parañaque

(3 Malls)

Las Piñas

(2 Malls)

Muntinlupa

(1 Mall)

Existing Sites

Future Sites

Untapped AreaNCR:

13M People

Philippine Population: 101M

Luzon:

45M People

Visayas:

19M People

Mindanao:

24M People

Taguig

(1 Mall)

MallsMalls

Tianjin

Zibo

Suzhou

Jinjiang

Xiamen

Chongqing

Chengdu

Key Business Units

China Malls

▶ Operating in China since 2001 and

became part of SM Prime

in 2007

▶ Contributed 5% of the overall revenues

and 4% of consolidated operating income

▶ Operates 7 malls with a total GFA of 1.3m

sqm

▶ SM Xiamen is scheduled for expansion

and will add 120,000 sqm., while SM

Yangzhou is set for construction and will

add 220,000 sqm.

Investor Kit 2020

Yangzhou

21

ResidencesResidences(as of 1H2020)

Revenue

PHP23.71bn

Operating Income

PHP9.68bn

Reservation Sales

PHP42.38bn

Residential Units Launched(since 2003)

144,912

Residences

Investor Kit 2020

Key Business Units

Primary Homes

▶ A leading residential developer of high-

rise buildings (HRBs) mid-rise buildings

(MRBs) and single-detached house and

lots

▶ Accounts for 54% of the consolidated

revenues

▶ Reservation sales value of PHP42.38

billion in 1H2020

▶ Unbooked Revenue amounts to

PHP180bn

▶ Total landbank: 1,204 hectares

Gold Residences, Parañaque City

Style Residences, Iloilo City

Light 2 Residences, Mandaluyong City

25

Residences

Key Business Units

Primary Homes

Glam Residences, Quezon City

Projects Overview (as of 1H2020)

Ready-for-Occupancy (RFO)

(Unsold Units)1,815

Ongoing Construction (Unsold Units) 10,433

Estimated Inventory Value

1H2020 Reservation Sales (value)

PHP91.28bn

PHP42.38bn

1H2020 CAPEX PHP13.12bn

Landbank (hectares)

Metro Manila 94

Outside Metro Manila 1,110

Investor Kit 202026

Residences

Caloocan (North)

Quezon City

(13 Projects)

Valenzuela

MarikinaCaloocan

MalabonNavotas

Manila

(1 Project) San Juan

Mandaluyong

(3 Projects)Pasig

(1 Project)

Pateros

Makati

(4 Projects)Pasay

(9 Projects)

Parañaque

(5 Projects)

Las Piñas

(1 Project)

Muntinlupa

(1 Project)

Taguig

(1 Project)

Residential Coverage

▶ SMPH fairly covered Metro Manila with high-rise condominium projects with majority of its residential projects located in the

cities of Quezon, Pasay, Paranaque and Makati.

▶ As of 1H2020, 39 out of the 50 SMDC projects in the country are located in Metro Manila.

Investor Kit 2020

Existing Sites

Future Sites

Untapped Area

28

Residences

Investor Kit 2020

Key Business Units

Leisure Homes

▶ Include 2 large-scale tourism projects –

Tagaytay Highlands and Pico de Loro

▶ Tagaytay Highlands is an exclusive

mountain resort, golf club and residential

complex, covering some areas of Cavite,

Laguna and Batangas

▶ The 40-hectare Pico de Loro is the

Phase 1 of Hamilo Coast project,

a premier and sustainable leisure

destination in Nasugbu, Batangas

▶ Landbank of 524 hectares

Freia at Pico de Loro Cove

Horizon Terraces Garden Villas

Woodlands Point Community at Tagaytay Highlands

29

OfficesOffices

(as of 1H2020)

Revenue

PHP2.54bn

Operating Income

PHP2.22bn

Gross Floor Area

0.7M sqm

Office Buildings

12

Offices

Investor Kit 2020

Key Business Units

Offices

▶ Have 12 office buildings with a combined

GFA of more than 695,000 sqm

▶ Four of these 12 offices are located in the

Mall of Asia Complex in Pasay City, which

provide a combined GFA of 435,000 sqm

▶ Have an available landbank of 80

hectares for future development

TwoE-comCenter

FiveE-comCenter

ThreeE-comCenter

33

Hotels and

Convention Centers

Hotels and

Convention Centers

(as of 1H2020)

Revenue

PHP1.09bn

Operating Loss

PHP0.36bn

Hotels

8

Convention Centers

& Trade Halls

7

Hotels and Convention Centers

Key Business Units

Hotels and Convention Centers

▶ Operating 8 hotels with over 1,900

rooms; 4 SMX Convention Centers,

and 3 Megatrade Halls with more

than 37,000 sqm of leasable space as of

June 2020.

▶ Conrad Manila and SMX Manila are both

located in Mall of Asia Complex, Pasay

City.

▶ SM Hotels and Conventions Corp.

(SMHCC) is set to open Lanson Place

Hotel and Serviced Suites in Mall of Asia

Radisson Blu Hotel Pico Sands Hotel Park Inn by Radisson -

Davao

Park Inn by Radisson - ClarkConrad Manila

SMX Convention Center

Investor Kit 202036

Key

Strategies

Landbank

2,010ha

2020 CAPEX

PHP80bn

Net Debt To Equity

42:58

(as of 1Q2020)

Key Strategies

Landbank

No. of Sites

Area

(in hectares) % of Total

Area by Region (in hectares)

Metro

Manila Provincial

41 203 10% 19 184

109 1,204 59% 94 1,110

4 524 27% - 524

15 80 4% 5 75

Total 169 2010 100% 118 1,893

Malls

Primary

Homes

Commercial

Leisure

Homes

▶ SM Prime’s landbank is good for the next 5 to 7 years, located in emerging progressive cities across the country

▶ Leisure projects are for medium-term development

Investor Kit 202040

Key Strategies

CAPEX Program

▶ SM Prime will maintain its budget of PHP 80 billion capital expenditures for 2020 to focus on

projects that will deliver sustainable returns in the long term.

▶ Furthermore, the Company will continue to explore opportunistic acquisitions and/or investments.

▶ The CAPEX program will be funded by the combination of local borrowings and internal funds.

65%

55%

41%32%

42%34%

28%

33%

51%62% 41% 56%

7%12%

8% 6%

17%10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015A 2016A 2017A 2018A 2019A 2020E

Malls Residences Others

PHP91bnPHP58bnPHP44bnPHP59bn

Investor Kit 2020

PHP69bn PHP80bn

41

Key Strategies

Maintain Conservative Balance Sheet

Investor Kit 202042

*Earnings before interest, income taxes, depreciation

and amortization (EBITDA)

Interest expense

11.19

9.64

8.96

7.59 7.56

5.86

0.00

2.00

4.00

6.00

8.00

10.00

12.00

2015 2016 2017 2018 2019 1H2020

Interest Coverage Ratio*

**Total interest-bearing liabilities- cash & cash equivalents

and investment securities

Total equity attributable to equity holders of the parent

62% 63% 64% 60% 60% 42%

38% 37% 36% 40% 40% 58%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015 2016 2017 2018 2019 1H2020

Net Debt to Equity**

Equity Debt Net Debt

Financial

Highlights

₱

Consolidated Net Income

Consolidated Revenue

PHP43.68bn

Consolidated

Operating Income

PHP10.43bn

(as of 1H2020)

PHP16.35bn

Financial Highlights

Consolidated FinancialsRevenue Segment Contribution

Investor Kit 2020

▶ Malls accounts for 38% of SM Prime’s consolidated revenues.

▶ Residences accounts for 54%.

▶ Other Business Segments cover the rest.

62% 61% 58% 57% 54%

38%

32% 32%33% 35% 38%

54%

6% 7% 9% 8% 8% 8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015 2016 2017 2018 2019 1H2020

Malls Residences Other Business Segments

44


Consolidated FinancialsNet Income Segment Contribution

Investor Kit 2020

▶ Residences contribute the most among key business units, followed by Malls.

72%67% 65% 62% 60%

29%

24%

24% 25% 29% 33%

60%

4%9% 10% 9% 7%

11%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015 2016 2017 2018 2019 1H2020

Malls Residences Other Business Segments

45


▶ Net income went down by 46% to PHP10.4bn in 1H2020 from PHP19.3bn, while operating income is 40% lower

to PHP16.4bn in 1H2020 from PHP27.4bn. Consolidated revenues likewise dropped by 23% to PHP43.7bn from

PHP57.0bn.

▶ The declaration of COVID-19 by the World Health Organization (WHO) as a pandemic and declaration of

nationwide state of calamity and implementation of enhanced community quarantine (ECQ) measures in the

areas of Luzon last March 16 have caused disruptions in the Company's business activities, and its impact

continues to evolve.

Consolidated Financials

Investor Kit 2020

(In PHP Billion) 1H2020 1H2019 % Chg

Revenues 43.68 57.05 -23%

EBITDA 21.74 32.34 -33%

Operating Income 16.35 27.43 -40%

Net Income 10.43 19.30 -46%

46


▶ Rental Income in 1H2020 is PHP13.1bn, 44% lower from PH23.3bn due to ECQ implemented in Luzon and some areas in the Philippines and management’s decision to waive rental fees in all malls from Mid-March until end of June.

▶ Operating income likewise went down by 73% to PHP4.3bn from PHP15.8bn.

FinancialsMalls: PH

Investor Kit 2020


Revenues 14.42 28.08 -49%

- Rent Income 13.15 23.34 -44%

- Cinema and Event Ticket Sales

and others1.27 4.74 -73%

EBITDA 8.17 19.25 -58%


47


▶ SM Prime’s China mall business which reported closure in January 25 due to the spread of

COVID-19 in the region, has now all seven malls running at 80% capacity, with foot traffic

gradually going back to normal since its gradual reopening from February 10 to March 11 when

lockdowns in China were lifted.

▶ China government provided SM Prime tax breaks to cushion the impact of the pandemic in its

business activities

FinancialsMalls: CH

Investor Kit 2020

(In RMB Billion) 1H2020 1H2019 % Chg

Revenues 0.28 0.39 -29%

- Rent Income 0.26 0.37 -30%

- Others 0.013 0.014 -7%

EBITDA 0.20 0.30 -31%


48


▶ Revenues increased by 11% to PHP23.7bn in 1H2020 from PHP21.4bn last year due to

higher project completion.

▶ Gross profit margin improved to 54% from 53%, whereas net income margin declined to

26% from 28% of last year.

▶ SMDC’s reservation sales in the first half of 2020 amounted to PHP42.4 billion.

FinancialsResidences

Investor Kit 2020


Revenues 23.71 21.43 11%

EBITDA 9.77 8.37 17%

Operating Income 9.68 8.31 17%

49


▶ Revenues from Commercial Properties Group and Hotels and Convention Centers cover 8% of the overall consolidated revenues.

▶ The Company’s office business segment continues to operate during ECQ with 90% of its tenants being business process outsourcing (BPO) offices, which were allowed by the Philippine’s Inter-Agency Task Force (IATF) to conduct business.

▶ Conrad Manila, Park Inn Clark, Park Inn North EDSA and Park Inn Iloilo remained operational during ECQ to cater to BPO employees and returning overseas Filipino workers/seafarers.

FinancialsOther Businesses

Investor Kit 2020


Revenues 3.63 4.63 -22%

EBITDA 2.51 2.93 -14%


50


▶ We continue to maintain a very conservative balance sheet

▶ More than half of our assets are in the investment properties while our interest bearing

debt accounts for 36%

Consolidated Balance Sheets

Investor Kit 2020

(In PHP Million (except % data) 1H2020 % to Assets 2019 % to Assets

Assets

Cash and cash equivalents 19,984 3% 34,600 5%

Equity instruments at fair value through other

comprehensive income15,497 2% 21,080 3%

Receivables & Contract Assets 65,748 10% 53, 637 8%

Investment Properties 421,468 62% 410,640 62%

Real Estate Inventories 40,989 6% 43,946 7%

Other Assets 114,270 17% 103,377 15%

Total Assets 677,956 100% 667,280 100%

Liabilities and Stockholders’ Equity

Interest bearing debt 240,951 36% 237,954 36%

Accounts payable and other 135,831 20% 126,809 19%

Total Liabilities 376,783 56% 364,763 55%

Total Equity attributable to equity holders of the

parent299,477 44% 300,916 45%

51


(In PHP millions) 1H2020 2019 2018 2017 2016 2015

Cash Flows from Operating Activities

Operating Income before Working Capital

Changes22,015 65,791 56,592 48,058 37,678 36,362

Net Cash provided by (used in) operations 9,439 51,728 45,964 45,777 31,491 31,938

Net Cash provided by (used in) Investing

Activities(24,331) (48,615) (64,078) (41,012) (27,080) (55,230)

Net Cash Flows provided by (used in) Financing

Activities281 (7,310) 12,633 14,176 (5,604) 14,015

Net Increase (Decrease) in Cash and Cash

Equivalents(14,616) 4,167 5,605 19,171 (669) (9,375)

Cash and Cash Equivalents at Beginning

of Year 34,600 38,766 44,371 25,201 25,870 35,245

Cash and Cash Equivalents at End of Year 19,984 34,600 38,766 44,372 25,201 25,870

▶ Net gearing is equivalent to 42:58 in 1H2020, below the management target of

keeping 50:50 net debt to equity ratio

Cash Flow

Investor Kit 202052

Investment Highlights

Investor Kit 2020

▶ Establish strong brand equity

▶ Leading integrated real estate platform

with strong track record across full suite

of asset classes

▶ World-class mall business, which will

anchor future sustainable lifestyle city

projects

▶ Significant growth opportunities from

landbank optimization and future

acquisitions

▶ Strong balance sheet supported by

strong recurring income

▶ Highly experienced management team

and strong corporate governance

2019 Annual Report

2019 Sustainability Report

53

INVESTOR KIT 2020This presentation is available online through www.smprime.comInvestor Kit 2020This presentation is available online through www.smprime.com

https://smprime.com

https://smprime.com

investor kit 2019 · presentation is or should be relied upon as a promise or representation as to...

Documents