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Richmond Mercurio - The Philippine Star
March 1, 2025 | 12:00am
MANILA, Philippines — SM Investments Corp. (SMIC), the investment holding company of the Sy family, recorded higher profit last year despite inflationary headwinds and the high base of 2023.
SMIC saw its net income jump by seven percent to P82.6 billion in 2024 from P77 billion the previous year.
Of the total net income, banking contributed the largest share at 49 percent, followed by property at 26 percent, retail at 18 percent and portfolio investments at seven percent.
Consolidated revenues during the year reached P654.8 billion, up by six percent from P616.3 billion in 2023.
SMIC president and CEO Frederic DyBuncio said the fourth quarter registered the highest revenue growth rate of 9.4 percent, giving the company solid momentum into 2025.
“We ended 2024 with a strong performance, despite the high base of 2023 and inflationary headwinds during the year. Our core businesses all grew, supported by positive macroeconomic fundamentals and healthy consumer sentiment,” DyBuncio said.
In 2024, SM Retail delivered a net income of P20.9 billion, an improvement from P19.9 billion in the previous year.
Retail revenues increased by five percent year-on-year to P434.5 billion, with the food retail segment serving as the strongest performer as a result of the expanded store networks and improved customer engagement.
SMIC said that specialty stores also registered a solid performance, while department store operations remained resilient.
“In retail, discretionary spending remained strong throughout the year, particularly in branded fashion, health and beauty and household appliances. Meanwhile, food retailing gained momentum across all formats in the fourth quarter as inflation tapered,” DyBuncio said.
Higher contributions from all its business segments fueled a 14-percent surge in the net income of SM Prime Holdings Inc. in 2024 compared to last year’s level. The integrated property developer recorded a net income of P45.6 billion, up from the previous year’s P40 billion.
SM Prime’s revenues expanded by 10 percent to P140.4 billion due to higher rental income, real estate sales and revenues from services and experiential offerings.
For the group’s banking business, BDO reported a bottom line of P82 billion, 12-percent higher than in 2023, supported by the solid performance across its core businesses.
China Banking Corp., meanwhile, booked a 13-percent improvement in profit to P24.8 billion as revenues rose by 21 percent to P65.5 billion.
SMIC’s portfolio investments likewise continued to perform positively last year with Philippine Geothermal Production Co. contributing 46 percent of total portfolio net income, NEO at 22 percent and Belle Corp. at 10 percent.
Overall, the group expanded by an additional 619 retail stores, two malls and 73 bank branches in 2024, with over 85 percent of its footprint in the provinces.
As it expands, SMIC continues to broaden access to different markets and enhance synergies across its businesses.
Buyback program
Meanwhile, SMIC is embarking on the first buyback program in the company’s history in hopes of beefing up its share price, which the company currently sees as undervalued.
The parent company of the SM Group yesterday approved a share buyback program of up to P60 billion.
“This major undertaking is in recognition of the significant under-valuation of SM Investments’ share price. In the current market we trade well below our historical valuation multiples, which do not reflect the performance and future growth potential of the group,” DyBuncio said.
SMIC shares closed at P780 per share on Feb. 27, translating to a price-earnings ratio of 11.5x based on 2024 earnings. Its 52-week high stands at P1,010, while its 52-week low is at P769.
