SM Investments Corporation · PSE:SM
SM Investments — Investor Presentation (April 2017)
41 slides from SM Investments's investor presentation, April 2017
Slide 1: Investor Presentation
Investor Presentation April 2017
Slide 2: Table of Contents
Table of Contents • The Philippine Economy 3 • About SM Investments 5 • SM Retail 13 • Banking 14 • SM Prime 15 • Land Bank 28 • Portfolio Investments 31 • Financials 34 2
Slide 3: Philippines: Strong Macroeconomic Fundamentals
Philippines: Strong Macroeconomic Fundamentals Young Workforce with Rising Incomes Opportunities Strong GDP Growth Consumption Driven • Job creation and inclusive growth 6.8% 69.4% of GDP • Provincial growth – Visayas, Mindanao Per Capita GDP Per Capita GNI • Infrastructure development USD2,947 (+2.
Slide 4: Current Administration’s 10-point Socio-economic Agenda
Current Administration’s 10-point Socio-economic Agenda Maintain current macroeconomic policies, including fiscal, monetary, Effective land management and trade policies Invest in human capital Progressive tax management development Promote science, technology, and Pursue investment friendly reforms
Slide 5: About SM Investments
About SM Investments Strong proxy for the continuing breakout of the Philippine Economy Consumer-centric businesses Large cap and diversified market play Core businesses remain market leaders Strong business model and excellent management Prudent financial management Tightly managed to lev
Slide 6: Our Investments
Our Investments Portfolio Core Investments Investments Retail Banking Property 28% BELLE CORP 29% 77% 44% 20% 50% ATLAS CHINA CONSOLIDATED SM RETAIL INC. BANCO SM PRIME HOLDINGS, INC. MINING BANKING DE ORO CORP. 90% SPECIALTY RETAILERS LEISURE & TOURISM NET GROUP JOINT VENTURES CONVENTIONS THE SM ST
Slide 7: SM Group Companies’ Rankings
SM Group Companies’ Rankings Philippine Conglos Philippine Retailers Philippine Banks Property Developers Market Cap ($bn) Total Sales ($mn) Total Resources ($bn) Market Cap ($bn) SMIC 16.7 FY 2015 BDO 46.8 SMPH 16.3 JG Summit 11.6 Metrobank 37.6 Ayala Land 9.7 SM Retail 4,482 Ayala Corp 10.5 BPI 34
Slide 8: Our Business Footprint
Our Business Footprint Metro Manila Luzon 16 Cities 1 Municipality Total Population: 101M 38 Provinces 55 Cities Retail Stores GSA Retail Stores GSA Total 733 1,105,546 Total 813 1,011,558 Food 93 473,933 Food 148 564,293 Non-food 23 363,165 Non-food 24 255,917 Specialty 617 268,447 Specialty 641 19
Slide 9: Our ESG Programs
Our ESG Programs “SM continues to find ways to provide Filipinos with various opportunities for growth. Equally important is our impact on the environment and the company’s thrust to becoming a progressive leader in sustainable business practices in the country.” - Harley T. Sy Environmental Corpora
Slide 10: Strong Leadership
Strong Leadership Board of Directors From L to R: TOMASA H. LIPANA, Independent Director • HENRY T. SY, JR., Vice Chairperson • TERESITA SY- COSON, Vice Chairperson • HENRY SY, SR., Chairman • HARLEY T. SY, Director and President • JOSE T. SIO, Director, Executive Vice President and Chief Finance Of
Slide 11: 10-Year Performance
10-Year Performance Assets grew at 14.3% p.a. In PHP Billion Market Cap grew 15.3% p.a. 861 227 2006 2016 789,002 Revenue grew at 15.1% p.a. In PHP Billion In PHP Million 363 89 2006 2016 Net Income grew at 11.5% p.a. 190,450 In PHP Billion 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 31.2
Slide 12: Summary of SMIC Recent Performance
Summary of SMIC Recent Performance Figures in PHP billion except percentages Recent Events SM Investments FY 2016 FY 2015 Change FY Parent 2015 Revenues 362.8 332.8 9.0% • Issued PHP20B of retail bonds at 5.1590% due 332.2 Net Income* 31.2 28.9 8.1% 2023 which is a maiden issue from the PHP50B 43.7
Slide 13: SM Retail: Footprint Expansion Opportunity
SM Retail: Footprint Expansion Opportunity SM Retail Footprint by Format SM Retail Footprint by Region Department Stores Stores GSA (sqm) Average Luzon The SM Store 57 745,649 13,082 45M people Metro Manila Food Stores GSA (sqm) Average 13M people SM Supermarket 48 331,324 6,903 SM Hypermarket 44 33
Slide 14: Banking: BDO and China Bank Business Strategy
Banking BDO China Bank Business Strategy Business Strategy • Diversified and sustainable earning stream • Accelerate Expansion • Client acquisition through branch expansion • Grow Revenue Lines • Drive provincial lending and deposit taking initiatives • Solidify presence in corporate market • Expand
Slide 15: About SM Prime
About SM Prime • Developer of large scale, mixed-use “Lifestyle cities” anchored on world-class malls Malls • The largest integrated property developer in Southeast Asia by market capitalization • High recurring income Commercial • Extensive landbank • Consistently cited for excellence in corporate
Slide 16: SM Prime’s 5-Year Roadmap
SM Prime’s 5-Year Roadmap Residences Hotels & Convention Malls Commercial Primary Homes Leisure Homes Centers (2013-2018) GFA: 10.5 Million sqm Launched Units: 138,010 Launched Units: 3,031 GFA: 0.51 Million sqm Rooms: 1,510 2018 est (86% Phil + 14% China) Projects: 70 Projects: 22 No of Towers: 7 P
Slide 17: The Mall of Asia Complex: A Lifestyle City Development
The Mall of Asia Complex: A Lifestyle City Development Sea Residences Mall of Asia Arena • Commercial, entertainment SMX Convention and residential hub Shell Residences Center • 60 hectares of reclaimed Shore Residences land fronting Manila Bay • Existing structures: Mall of Asia Five E-com Center •
Slide 18: SM Seaside Cebu: A Lifestyle City Development
SM Seaside Cebu: A Lifestyle City Development Chapel of San Observation Tower Pedro Calungsod • 30 hectares mixed use SM-ALI JV development on reclaimed land in Cebu • Integrated development • Site of Cebu’s largest mall SM Seaside City and the fourth largest SM mall in the country with a GFA of 430
Slide 19: SM Malls: Overview
SM Malls: Overview Largest mall operator/developer in the Philippines 19
Slide 20: SM Malls: Philippines
SM Malls: Philippines Philippine Population: 101M Area Malls GFA (sqm) % of Total Metro Manila (NCR) 22 3,414,377 45% Luzon Luzon (ex-NCR) 29 2,659,678 35% 45M Visayas 5 1,095,303 14% people Mindanao 4 491,254 6% NCR Total 60 7,660,612 100% 13M people Upcoming Malls Opening GFA (sqm) SM Cherry Antip
Slide 21: SM Malls: Philippines BPO Expansion Plans
SM SM Malls: Malls: Philippines BPO Expansion Expansion Plans Plans SM City Clark 5&6 SM Southmall Tower New Number GLA (sqm) Total Available Sites 27 252,028 Upcoming Sites Opening GLA (sqm) SM City Clark 5&6 4Q 2016 28,900 SM City Sta. Rosa 4Q 2016 26,117 SM City Sta. Rosa SM Fairview Tower Sub-to
Slide 22: SM Malls: China
SM Malls: China SM Zibo SM Tianjin Existing Date Opened GFA (sqm) SM Xiamen 2001 December 238,125 Jinjiang 2005 November 167,830 Chengdu 2006 October 166,665 Suzhou 2011 September 72,552 Chongqing 2012 December 149,429 Zibo 2015 September 150,600 Tianjin (partial) 2016 320,614 Total 1,265,815 22
Slide 23: SM Residences
SM Residences Projects Overview FY 2016 Total Units Launched since 2003 102,424 Total Units Sold since 2003 84,832 % Sold to date 82.9% Reservation Sales (value) PHP47.7B Reservation Sales (units) 16,670 Est. launches in 2017 (units) 15,000-18,000 SMDC Fame SMDC Air 2017 CAPEX PHP16.7B SMDC Shore Am
Slide 24: SM Residences Example – Shore Residences
SM Residences Example – Shore Residences One Bedroom with Balcony Two Bedroom with Balcony Approx. 27.7 to 29.5 sqm Approx. 58.5 sqm 24
Slide 25: SM Commercial Properties
SM Commercial Properties Completed Opened GFA (sqm) SM Cyber Makati One 2008 22,055 SM Cyber Makati Two 2008 16,725 TwoE-com Center 2012 107,962 SM Aura Tower 2013 52,837 SM Cyber West 2014 41,799 FiveE-com Center 2015 141,706 Total 383,084 Under Construction Opening GFA (sqm) ThreeE-com Center 4Q 2
Slide 26: SM Hotels and Convention Centers
SM Hotels and Convention Centers Mall of Asia Arena • Growing tourism market opportunity • SM Hotel expansions complement existing mall, commercial and residential developments • Iloilo • SM North Edsa • San Fernando, Pampanga • SM Seaside City, Cebu Conrad Manila SMX Convention Center 26
Slide 27: SM Hotels and Convention Centers
SM Hotels and Convention Centers Conrad Manila Lobby Hotel Opened Rooms Taal Vista, Tagaytay 2003 260 Radisson Blu, Cebu 2010 396 Pico Sands, Hamilo Coast 2011 151 Park Inn, Davao 2013 202 Park Inn, Clark 2015 154 Conrad Manila, Pasay 2016 347 Total 1,510 Venue Location GLA (sqm) Conrad Manila Diplo
Slide 28: Land Bank
Land Bank Companies Land Bank (sqm) SM Prime 10,857,495 Coastal Malls 2,055,487 Zone Inland 1,580 Has Mountain Zone Residences 2,552,083 4,200 Has Commercial 830,395 Leisure Homes 5,419,530 SMIC 57,801,502 Total 68,658,997 28
Slide 29: Land Bank in Batangas: Hamilo Coast
Land Bank in Batangas: Hamilo Coast • Hamilo Coast asset is owned directly by SMIC • 5,780 hectares • 31 km of coastline • 13 coves • Pristine environment • 1½ - 2 hours from Manila 29
Slide 30: 2017 SM Group CAPEX
2017 SM Group CAPEX Businesses PHP bn Allocation/Projects Retail 5.2 New stores / Renovations Banks ~10.0 Branch expansion, IT enhancements Property 62.7 New SM malls and expansions in Malls 30.9 Philippines and China Residential 16.7 High-rise and mid-rise projects Commercial 13.6 ThreeE-com and Fo
Slide 31: Portfolio Investments: Belle Corporation
Portfolio Investments: Belle Corporation • 28% ownership; publicly listed • Developer of high-end entertainment and leisure properties • Subsidiaries: (In PHP mn) FY 2016 FY 2015 % Chg • Premium Leisure Corp., holds 1 of 4 gaming licenses in Entertainment Revenues 6,322 5,352 18.1% City complex in M
Slide 32: Portfolio Investments: Atlas Consolidated Mining
Portfolio Investments: Atlas Consolidated Mining • 29% ownership; publicly listed • Copper mine with 17 years mine life, over 370m tonnes of proved and probable reserves (In PHP mn) FY 2016 FY 2015 % Chg • Average 0.34% Cu at cut-off grade of 0.20% Cu • Excellent environmental and social record Reve
Slide 33: Portfolio Investments: CityMalls Commercial Corp.
Portfolio Investments: CityMalls Commercial Corp. • 34% owned by SM Investments • Rapid growth plans to develop strip malls markets outside Metro Manila • SM group brands consist of almost 40% of the GFA • 70% of target land bank secured • 100 CityMalls by 2020 33
Slide 34: Financials
34 Financials ) INVESTMENTS CORPORATION
Slide 35: Financials: SMIC
Financials: SMIC FY 2016 Consolidated Results Revenues +9.0% to PHP362.8bn In PHP Billion 4% Particulars FY 2016 FY 2015 Change FY2015 FY2014 FY2013 Revenue 362.8 332.8 9.0% 332.2 308.8 286.7 20% Reported Net Income* 31.2 28.9 8.1% 43.7 41.5 40.0 Net Margin (inc-NCI) 13.2% 13.1% - 13.1% 13.5% 14.0%
Slide 36: Financials: BDO
Financials: BDO Financial Highlights FY 2016 FY 2015 Change (In PHP Bn) Net Interest Income 65.6 57.0 15.2% Other Income 41.6 31.9 30.3% Net Income1 26.1 25.0 4.3% Assets 2,325.0 2,031.3 14.5% Deposits 1,905.2 1,663.9 14.5% Gross Customer Loans 1,482.0 1,279.4 15.8% Net Interest Margin 3.2% 3.2% --
Slide 37: Financials: BDO
Financials: BDO Loan and Deposit Growth Loan Growth Deposit Growth 3,000 CASA Time Deposits BDO Industry 2,500 1,905 2,000 1,664 PHP Bn 1,345 1,492 523 19% 20% 1,500 17% 932 526 533 17% 1,000 570 16% 20% 339 1,382 16% 500 959 1,138 16% 592 775 15% 14% - 2012 2013 2014 2015 2016 Deposits YoY∆ 44% 11%
Slide 38: Financials: China Bank
Financials: China Bank Financial Highlights FY 2016 FY 2015 Change (In PHP Bn) Net Interest Income 16.7 15.1 10.7% Non-Interest Income 5.1 4.5 13.5% Net Income 6.5 5.6 15.3% Assets 633.2 526.8 20.2% Deposits 541.6 439.3 23.3% Gross Customer Loans (ex-UDSCL) 389.0 315.0 23.5% Net Interest Margin 3.2%
Slide 39: Financials: China Bank
Financials: China Bank Loan and Deposit Growth Gross Loans (PHP bn) Funding (PHP bn) Corporate Commercial Consumer CASA High Cost FCDU LDR 394 70% 73% 71% 71% 450 62% 542 600 400 298 317 59 66% 350 500 439 82 228 399 46% 300 199 43 48 400 354 67 166 73 26% 250 272 71 206 200 23 30 128 142 300 160 6%
Slide 40: Financials: SM Prime
Financials: SM Prime FY 2016 Results In PHP Billions Earnings Revenue Consolidated FY 2016 FY 2015 % Chg Revenue 79.8 71.5 11.6% 7% 9% Recurring Net Income 23.8 20.9 13.9% Net Margin 29.8% 29.2% - 24% Return on Equity 10.7% 10.1% - 30% Malls Group FY 2016 FY 2015 % Chg 69% 61% Revenues 48.6 44.5 9.1
Slide 41: Contact Information and Disclaimer
Contact Information and Disclaimer Investor Relations Office Office Number: +63 2 857-0100 Email Address: [email protected] SM Official Website: www.sminvestments.com Official Facebook Account: www.facebook.com/sminvestments.ir Official Twitter Account: @SM_INVESTMENTS PSE Ticker SM ADR Ticker SM