Investor Kit 2019
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Malls INVESTOR KIT 2019 This presentation is available online through www.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. 2 Investor Kit 2019 Outline I. The Company • Company Profile • Key Business Units • Malls • Residences • Offices • Hotels & Convention Centers II. Key Strategies • Key Strategies • Landbank • Capex Program III. Financial Highlights • 1Q 2019 Results IV. Sustainability • Four Sustainability Pillars • UN SDGs V. Investment Highlights 3 Company Profile ▶ One of the largest integrated property developers in Southeast Asia by market capitalization Market Capitalization ▶ One of the largest listed real estate US$22.24bn developers on the PSE by market capitalization and net income PSE Stock Symbol SMPH ▶ Consistently cited for excellence in corporate governance, property Market Capitalization PHP1,157bn development, environmental consciousness, and investor relations programs Outstanding Shares 28,879mn Last Traded Price Php39.50/share (May 8, 2019) Average Daily US$6.26mn Turnover (YTD) 4 Investor Kit 2019 Key Business Units Hotels and Malls Residences Commercial Convention Centers ► SM Supermalls ► SM Development ► Offices and ► Radisson Blu Corp. and Warehouses ► SM Lifestyle ► Taal Vista Subsidiaries ► Mall of Asia ► Family ► Pico Sands ► Highlands Prime Inc. Complex Entertainment ► Park Inn Center Inc. ► Costa Del Hamilo ► Seaside City Cebu Inc. Complex ► Conrad Manila ► SMX Convention Centers 5 Investor Kit 2019 Key Achievements Malls (GFA in sqm) Residences (Units Sales) CAGR = 5.22% 9.5M 10M 9.3M 9.0M 18K 16.2K 16.6K 8.2M 16K CAGR = 18.48% 13.5K 8M 7.3M 7.0M 14K 12K 9.5K 6M 8.2M 6.2M 6.5M 7.3M 7.7M 8.0M 10K 8.0K 8K 6.0K 4M 6K 4K 2M 2K 0.8M 0.8M 0.9M 1.3M 1.3M 1.3M 0K 0M 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 China Philippines Offices (GFA in sqm) Hotels (Rooms) 700K 1.8K 642K CAGR = 7.75% 1,588 600K 1.6K 1,510 1,510 CAGR = 27.85% 456K 1.4K 1,229 500K 1,075 1.2K 1,015 400K 383K 318K 1.0K 300K 0.8K 189K 0.6K 200K 147K 0.4K 100K 0.2K 0K 0.0K 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 6 Investor Kit 2019 At a Glance MALLS RESIDENCES 1Q2019 Operating Highlights 1Q2019 Operating Highlights ► Total Revenues reached PHP15.0 billion, up by ► Total Real Estate Revenues expanded by 23% 8%from PHP13.9 billion to PHP9.1 billion from PHP7.4 billion ► Operating Income grew by 8% to PHP8.5 billion from ► Operating Income increased by 43% to PHP3.5 billion PHP7.8 billion from PHP2.4 billion ► Total Investment Properties of PHP274.2 billion ► Total Assets amounted to PHP191.6 billion OFFICES HOTELS AND CONVENTION CENTERS 1Q2019 Operating Highlights 1Q2019 Operating Highlights ► Total Revenues increased by 30% to PHP1.1 billion ► Total Revenues jumped by 2% to PHP1.22 billion from from PHP0.8 billion PHP1.19 billion ► Operating Income went up by 33% to PHP0.9 billion ► Operating Income went up by 7% to PHP282 from PHP0.7 billion million from PHP263 million ► Total Investment Properties amounted to PHP41.1 billion ► Total Investment Properties of PHP10.8 billion 7 Investor Kit 2019 Malls (as of 1Q2019) Revenue PHP15.0bn Operating Income PHP8.5bn Gross Floor Area 9.5m sqm Malls 72 in PH & 7 in CH Malls Key Business Units PHILIPPINES CHINA 72 Malls 7 Malls 8.3M sqm Total GFA 1.3M sqm Total GFA 18,475 Tenants 1,885 Tenants Average Daily Average Daily 4.2M Pedestrian Count 0.2M Pedestrian Count 329 Cinema Screens 58 Cinema Screens 88,702 Parking Slots 15,534 Parking Slots SM Prime is the largest mall operator/developer in the Philippines. 9 Investor Kit 2019 Malls Key Business Units Philippine Population: 101M Philippine Malls Luzon: ▶ In terms of GFA, Metro Manila 38 Malls malls account for 41%, Luzon is SMSG: 7% 37%, Visayas is 14% and Mindanao is 8% NCR: 23 Malls ▶ Average mature mall occupancy SMSG: 7% rate is 95% Visayas: ▶ Overall Same-Mall-Sales-Growth 6 Malls SMSG: 3% (SMSG) is 7% year-on-year (YoY) Mindanao: 5 Malls SMSG: 8% 10 Investor Kit 2019 Malls Key Business Units Mall Coverage in PH Philippine Population: 101M Caloocan (North) Existing Sites Luzon: Valenzuela Future Sites 45M People (1 Mall) Quezon City Navotas (5 Malls) Malabon Caloocan Marikina Untapped Area (1 Mall) (1 Mall) NCR: Manila 13M People (2 Malls) San Juan Mandaluyong (2 Malls) Pasig (2 Malls) Makati Pasay Pateros (2 Malls) Visayas: Parañaque (2 Malls) 19M People Las Piñas (2 Malls) Muntinlupa Mindanao: (1 Mall) 24M People ▶ SMPH malls covered almost all of the key cities in Metro Manila and adjoining towns and municipalities, accounting for 41% 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. 11 Investor Kit 2019 Malls Key Business Units China Malls ▶ Operating in China since 2001 and became part of SM Prime in 2007 SM Xiamen Lifestyle ▶ Contributed 6% of the overall revenues and 6% of consolidated operating income ▶ Operates 7 malls with a total GFA of 1.3m sqm ▶ Scheduled to expand SM Xiamen (120,000 sqm) and to start the SM City Tianjin construction of SM Yangzhou (220,000 sqm) SM City Suzhou 12 Investor Kit 2019 Malls Key Business Units Malls’ Expansion Program 2018 2019 New Malls New Malls SM City Legazpi SM City Olongapo Central Name GFA Name GFA SM Center Imus 13,000 SM Center Dagupan 23,000 SM City Urdaneta Central 59,000 SM City Olongapo Central 72,000 SM City Telabastagan 55,000 SM City Butuan 48,000 SM City Legazpi 87,000 SM Mindpro (Zamboanga) 36,000 SM Center Ormoc 33,000 SM City Baguio (expansion) +32,000 SM City Fairview (expansion) +46,000 ▶ This year, SM Prime’s mall launches will all be in the provinces, and these will add around 200,000 sqm of GFA. ▶ Available landbank of almost 190 hectares which is good for over the next 5 to 7 years 13 Investor Kit 2019 Malls Key Business Units Latest Project: First IKEA Store in the Philippines ▶ SM Prime is building the first IKEA store in the Philippines and this will be launched at the end of 2020.