2 weeks ago
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SM Investments Corporation (SMIC), the flagship of the Sy family, reported a seven percent improvement in consolidated net income to ₱82.6 billion last year from ₱77 billion in 2023 as its banking, real estate, and retail businesses fueled revenue growth.
In a disclosure to the Philippine Stock Exchange (PSE), the firm said its consolidated revenues grew by six percent to ₱654.8 billion in 2024 from the ₱616.3 billion generated in the previous year.
“We ended 2024 with a strong performance, despite the high base of 2023 and inflationary headwinds during the year,” said SM Investments President and CEO Frederic C. DyBuncio.
He added, “our core businesses all grew, supported by positive macroeconomic fundamentals and healthy consumer sentiment. The fourth quarter registered the highest revenue growth rate of 9.4 percent, giving us solid momentum into 2025.”
Banking contributed the largest share of total net income at 49 percent, followed by property at 26 percent, retail at 18 percent, and portfolio investments at seven percent.
SM Retail posted a net income of ₱20.9 billion, increasing five percent from ₱19.9 billion in the previous year, as revenues also grew by five percent to ₱434.5 billion from ₱412.9 billion in the previous year.
The food retail segment was the strongest performer, with eight percent revenue growth, driven by expanded store networks and improved customer engagement.
Specialty stores also saw solid performance, posting three percent revenue growth, 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.
SM Prime Holdings Inc. posted a consolidated net income of ₱45.6 billion in 2024, up 14 percent from ₱40 billion the previous year, driven by higher contributions from all its business segments.
BDO Unibank reported ₱82 billion in net income, 12 percent higher than in 2023, supported by the solid performance across its core businesses. Net interest income increased eight percent with the expansion in earnings assets and growth in the bank’s service businesses.
Meanwhile, China Banking Corporation booked a 13 percent increase year-on-year in net income to ₱24.8 billion, supported by the sustained strength of core businesses. The bank generated 21 percent higher revenues of ₱65.5 billion, mainly from net interest income, which grew 19 percent to P₱63.5 billion.
SMIC’s portfolio investments continued to perform positively, with Philippine Geothermal Production Company contributing 46 percent of total portfolio net income, NEO at 22 percent, and Belle Corporation at 10 percent.
In 2024, SM expanded by an additional 619 retail stores, two malls and 73 bank branches, with over 85 percent of its footprint in the provinces. As SM expands, it continues to broaden access to different markets and enhance synergies across its businesses.
In a separate disclosure, SMIC said its board of directors has approved a share buyback program of up to ₱60 billion (approximately $1 billion), the first buyback program in SM Investments' corporate history.
“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,” said DyBuncio.
SMIC shares closed at ₱780 pesos per share on Feb. 27, 2025, translating to a price-earnings ratio of 11.5 times based on 2024 earnings.
The buyback program intends to create value for the company’s shareholders by reducing the number of shares outstanding, thereby improving future earnings per share.
“We always aim to create and return value to our shareholders. This program intends to do so by authorizing the buyback of up to approximately six percent of our shares outstanding,” DyBuncio explained.
The company will execute the buyback program in the open market.
