SM Prime Holdings, Inc. · PSE:SMPH
SM Prime — Investor Presentation (January 2015)
36 slides from SM Prime's investor presentation, Jan 21, 2015
Slide 1: Investor Presentation
Investor Presentation | Investor Kit |2015 |
Slide 2: | Investor Kit |2015 |
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
Slide 3: The Company; Financial Highlights
I. The Company Company Profile Key Business Units 1. Malls 2. Residential 3. Commercial 4. Hotels and Convention Centers Key Strategies Roadmap Capex Program II. Financial Highlights 9 Months 2014 Results | Investor Kit |2015 | 3
Slide 4: One of the largest integrated property developers in Southeast Asia
One of the largest integrated Market property developer in Southeast Asia Capitalization • US$12.07bn by market capitalization One of the largest listed real estate PSE Stock Symbol SMPH developer on the PSE by market Market Capitalization Php537bn capitalization, total assets and net Outstandin
Slide 5: Malls, Residential, Commercial, Hotels & Convention Centers
HOTELS & MALLS RESIDENTIAL COMMERCIAL CONVENTION CENTERS | Investor Kit |2015 | 5
Slide 6: Mall operations expected to account for over 50% of revenue
The company expects mall operations to account for over 50% of SM Prime’s revenue and net income | Investor Kit |2015 | 6
Slide 7: Emerging business in China
SM Prime’s emerging business in China translates to strong growth both in revenues and net income SM Prime plans to open one mall per year in second and third tier cities SM China malls’ combined GFA is 790,000 sqm, 11% of the group’s 6.3m sqm GFA | Investor Kit |2015 | 7
Slide 8: 2015 Expansion Program
Opening GFA (sqm) 1H2015 SM SRP Cebu 460,791 1H2015 SM Sangandaan 32,000 2H2015 SM San Mateo (Center) 67,631 2H2015 SM Cabanatuan 172,000 2H2015 SM Trece Martires Cavite 49,200 1H2015 SM lloilo Expansion 35,331 Total 816,953 tnd of 2015 Total Malls 55 Total GFA 7.2 mn sqm st) PRIME [moms [cums [inl
Slide 9: Primary Homes Projects Overview
I Primary Homes Projects Overview Ready-for-Occupancy (RFO) Units 2,499 Ongoing Construction (Unsold Units) 11,700 Total Units Made Available since 2005 67,841 Planned Launched over 12 months 5 Reservation Sales for 3Q 2014 Php 24.3 bn 2015 CAPEX Php 17.2 bn Project Php 12.8 bn Land banking Php 4.4
Slide 10: Operates under SMDC, a leading condominium developer
Operates under SMDC, a leading condominium developer in Metro Manila 5 completed projects in 2013; 16 ongoing developments and 5 more (3 new projects; expansion of 2 existing projects) to be launched over the next 12 months Land bank of 144 hectares, some of which can be converted into mixed-u
Slide 11: Tourism projects: Tagaytay Highlands and Pico de Loro
2,035 launched units for 12 projects 2 large-scale tourism projects – Tagaytay Highlands and Pico de Loro Tagaytay Highlands is an exclusive mountain resort, golf club and residential complex 40 hectares Pico de Loro project is Phase 1 of Hamilo Coast project, a premier, sustainable leisure
Slide 12: Office buildings for the BPO industry
Office buildings primarily catering to the burgeoning BPO Industry GFA for 4 completed towers: 190K sqm Access to enlarged landbank and balance sheet to accelerate growth Available landbank: 7-10 years | Investor Kit |2015 | 12
Slide 13: Mall of Asia Arena
Mall of Asia Arena (MOA Arena) with 16,000 seating capacity | Investor Kit |2015 | 13
Slide 14: Hotels and Convention Centers
4 operating hotels with over 1,000 rooms 4 SMX Convention Centers and 2 Megatrade Halls with over 36,000 sqm of leasable space Conrad Hotel in Mall of Asia Complex and Park Inn by Radisson in Clark are currently under construction Plans to build SMX Convention Centers and hotels near SM Mall
Slide 15: Key strategies
Increase acquisition of large-scale Offer wide range of products in the strategic landbank and develop residential segment more lifestyle cities Leverage on world-class malls to Continue the aggressive rollout of anchor lifestyle city strategy BPO office development Maintain strong balance sheet, Op
Slide 16: Increase acquisition of large-scale strategic landbank
Increase acquisition of large-scale strategic landbank and develop more lifestyle cities MOA Complex Future lifestyle city projects Mall of Asia val Proven landbanking capabilities “ : eee Cebu City Track record of value enhancement through integrated master planning World-class retail malls and com
Slide 17: SM Mall of Asia Complex flagship project
SM Mall of Asia Complex flagship project = SM Mall of Asia 406,961 sqm GFA Sea Residences = One and Two E-com Center BPO office buildings = SMX Convention Center = SM MOA Arena Conrad Hotel = Three E-com Center BPO office building = Shell Residences (2015) = A60 ha master-planned bayside development
Slide 18: Leverage world-class malls to anchor lifestyle city strategy
2 |) Leverage on world-class malls to anchor lifestyle city strategy = 7 Philippine malls (GFA of 1,044,836 sqm) and 2 China malls (GFA of 694,000 sqm) are planned to be completed by 2015 = Continue roll-out in major cities outside Metro Manila where disposable income is rising significantly = Expan
Slide 19: Optimize existing properties
© Optimize existing properties = Most of the existing malls occupy less than half of their lot area = Developing non-retail components in this space will significantly unlock property value = Atleast 10 projects, located in prime areas have been identified Resulting in: — Higher development margins
Slide 20: Offer wide range of products in the residential segment
4 | Offer wide range of products in the residential segment Significant housing shortfall 2013 and 2014 project launches approx. 3,700 units approx. 8,000 units approx. 3,642 units ® There is currently a significant housing supply shortfall in the affordable income segment (Php1.25mm — Php3.0mm)* ®
Slide 21: Continue the aggressive rollout of BPO offices
5 | Continue the aggressive rollout of BPO Offices Ongoing projects Opportunities 2 Ongoi ts = Well positioned to take advantage of strong growth in the Philippine BPO industry given proximity to SM malls and key transportation hubs @ Increasing “Flight to quality” from older buildings in Fo blighte
Slide 22: Maintain strong balance sheet and good governance
@aintain strong balance sheet, prudent risk & capital management, and good corporate governance Strong Balance Sheet and enhanced access to funding Prudent risk management Good Corporate Disciplined Governance Allocation of Capital | Investor Kit [2015 | 22
Slide 23: Double income by 2018 based on 5 year roadmap
We intend to double our income by 2018 based on our 5 year roadmap The growth will be driven by malls and residential units | Investor Kit |2015 | 23
Slide 24: Almost Php200bn capex over 3 years
4% 4% 3% 100% 5% 13% 12% 80% 41% 28% 30% 60% 40% 49% 56% 55% 20% 0% 2014 2015 2016 Malls Residential Commercial Hotels & Conventions We will spend almost Php200bn over 3 years to jumpstart our expansion program to achieve our goal to double the income by 2018 We will maintain a very conservative
Slide 25: Debt to equity and net debt to equity
Debt to Equity* Net debt to equity** 100% 100% 90% 90% 22% 28% 31% 35% 32% 35% 39% 43% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 78% 72% 69% 65% 68% 65% 61% 57% 30% 30% 20% 20% 10% 10% 0% 0% 2011 2012 2013 9M 2014 2011 2012 2013 9M 2014 Equity Debt Equity Net Debt **Total interest-bearing liabilities-
Slide 26: Investment highlights
Establish strong brand equity Leading integrated real estate platform with strong track record across full suite of asset classes World-class retail malls business, which will anchor future lifestyle city projects Significant growth opportunities from landbank optimization and future acquisi
Slide 27: Financial Highlights
Financial Highlights | Investor Kit |2015 | 27
Slide 28: 9M14 consolidated revenues and net income
SM Prime recorded consolidated revenues of Php47.8bn in 9M14, up 8.5% YoY while total cost and expenses increased by only 5% to PhpP27.7bn allowing EBIT to post 13.8% growth to P20.1bn Overall net income grew by almost 12% to Php13.5bn, sustaining growth posted in 1H14 | Investor Kit |2015 | 28
Slide 29: Malls revenue 9M 2014
SM Prime malls (60% of total turnover) posted revenues of Php28.3bn in 9M 2014, up 14 % YoY Cinema ticket sales added Php3.3bn on the top-line of mall operation, +21% YoY SMPH will end 2014 with more than 7.5m sqm of shopping space | Investor Kit |2015 | 29
Slide 30: Philippine malls revenue
1H 2013 Philippine Malls revenue (90% of total malls) grew by 13.1% to Php25.6bn in 9 months, mostly driven by the 7% growth in same-store- sales and additional shopping space of 527k sqm in the past 2 years Net income growth should catch up as new malls contribution accelerate while depreciatio
Slide 31: China malls revenue
China Malls revenue (10% of total malls) grew by 23.1% to Php2.6mn due to contribution from new malls while tenants on existing malls shift to percentage of sales rental revenues EBITDA margin expanded to 75.6% attributed to cost efficiencies and higher revenues Occupancy level above 90% for t
Slide 32: Residential revenue
Residential revenue (32% of consolidated revenue) continue to show improvements, following the 9% year-on-year growth posted in the previous quarter and 17% decline in the first quarter Expecting the housing unit group to sustain its growth going to next year as more projects are expected to be
Slide 33: Commercial Property Group
Commercial Property Group has recently ground break ThreeE-com and already topped off the FiveE-com By the end of 2014, the commercial business unit will have four office buildings with an estimated gross leasable area of 129k sqm Aiming to reach almost 500k sqm of office space by 2018 | Inves
Slide 34: Segment contribution
Segment Contribution 2% 2% 3% 3% Revenue from Malls 100% 9% 4% 5% 5% comprise 60% of 90% 80% 32% SMPH’s revenue, while 40% 35% 70% 35% residential revenue is 60% 32% 50% 40% 60% Rent from commercial 53% 53% 57% 30% office spaces make up 20% 10% 5% while Hotels and 0% Convention centers 31-Dec-11
Slide 35: Cash rose by 30% to Php35bn
As of September As of December In Php Million (except % data) 2014 % to Assets 2013 % to Assets ASSETS Cash and cash equivalents 35,361 9% 28,029 8% Available-for-sale investments 29,718 8% 23,369 7% Receivables 30,616 8% 27,184 8% Investment properties 194,332 50% 171,666 51% Land and development 4
Slide 36: Thank you
\\ ‘ iN y A SN AK AY AY SONG k you. 36
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