Sm Investments Corporation · PSE:SM
Sm Investments — H1 2009 Earnings Presentation
30 slides from Sm Investments's earnings presentation, Aug 13, 2009
Slide 1: 1st Half 2009 Investor Presentation
1st Half 2009 Investor Presentation 13 August 2009 Website: www.sminvestments.com
Slide 2: SM at a Glance
Retail Malls Banking Property Hotel and Entertainment (100%) (51%) (46%) (67%) (100%) SM Prime SM Retail, Inc. Holdings, Inc. BDO SM Land, Inc. SM Hotels and SM Department (20%) Entertainment Stores (85%)1 China Bank SM Development SM Supermarkets Corp. (44%) (100%) Mall of Asia SM Hypermarkets Comp
Slide 3: Business segments overview
Largest retail chain with 102 stores nationwide. commercial, resorts and hotel development Among the fastest growing in residential, Largest banking network with significant interest in BDO and China Bank Retail Property Banking and Development Financial Services Hotel and Mall Operations Entertainm
Slide 4: Strong Financial Position
Strong Financial Position (In Php billion) 1H09 1H08 % Chg Strong balance Total Assets 305.7 248.0 23.3% sheet with 1H’09 assets up by 23% Current Assets 75.1 68.5 9.6% to Php305.7 bn Non-Current Assets 230.6 179.5 27.8% Net debt ratio of Current Liabilities 46.1 47.0 -2.0% only 29 : 71 Long-term Li
Slide 5: Profitable Operation
Profitable Operation (In Php billion) 1H09 1H08 % Chg 1st Half ’09 Revenues 74.5 65.8 13.2% revenues up 13% Gross Profit 13.5 9.8 37.2% to Php74.5 billion Other Income / (Exp) (1.3) 1.2 -204.9% Net income Net Profit Before Tax 12.2 11.0 10.6% growth of 14% Minority Interest 2.5 2.1 19.7% Growth driv
Slide 6: High Intrinsic Value
High Intrinsic Value Net Asset 1st Half 2009 Revenues Net Income Value** SM Investments Php 74.5 bn Php 7.4 bn Php 241.85 bn (+13%) (+14%) Php 396/sh Revenue Net Income NAV Core Businesses Profile Profile Profile Retail Merchandising 81% 39% 26.5% Mall Operations 11% 27% 34.8% Banking and Financial
Slide 7: Retail Operations
nif . CORPORATION a . me eenens ; Z +. 0 _soopateialle = be Retail Operations I eee is
Slide 8: Overview of Retail Merchandising
Overview of Retail Merchandising SM Department SM SM Stores Makro Supermarkets Hypermarkets Philippines’s Philippines’s top One-stop Leading wholesale leading one-stop supermarket chain household chain lifestyle and 44 stores shopping fashion chain 18 SaveMore convenience 35 Department stores 12 Who
Slide 9: Overall Retail Results
Overall Retail Results Defensive growth 1H09 1H08 % chg strategy with increased roll out of food retail Sales (Php bn) 56.4 52.6 7.2% stores Net Income (Php bn) 2.4 1.7 41.2% Structural Net Margins 4.3% 3.2% -- improvements in non- ROE 35.0% 27.0% -- food merchandising Total No. of Stores 106 89 19%
Slide 10: Key Business Strategy
Key Business Strategy Maintain business leadership through store expansions and providing service quality into untapped markets, while pursuing sustainable growth and profitability SM Department SM SM Stores Makro Supermarkets Hypermarkets Strategy: Strategy: Strategy: Strategy: Further expansion Fu
Slide 11: Mall Operations
| ny \ CORPORATION
Slide 12: SM Supermalls
SM Supermalls 34 malls nationwide GFA of 4.4 million sqm. 4 successful malls listed among the world’s largest Over 10,374 tenants Largest network of cinemas numbering over 201 with 125,382 seats Average Foot traffic: Over 2.5 million per day 900 million per annum
Slide 13: Financial Highlights
Financial Highlights Revenues Operating margin: 53% EBITDA: Php6.6 bn 17.8 EBITDA margin: 69% Php billion 20.0 10.9 13.7 16.0 % Change 9.6 30% 20% Net margin: 35% 10.0 10% ROE: 15% 0.0 0% 2005 2006 2007 2008 1H09 1H09 1H08 % chg Revenues % chg Sales (Php bn) 9.6 8.4 15.3% Net Income Operating Expens
Slide 14: 2009 Expansion
2009 Expansion Gross Floor Area (s.q.m.) SM Naga 64,870 SM Rosario 52,142 SM Naga SM Pamplona SM Las Pinas 32,387 SM Fairview Expansion 28,612 SM City Rosales Expansion SM Rosales Expansion 17,000 SM North Edsa Sky Garden 31,000 226,011 Number of Malls by end-2009 36 GFA by end-2009 (in sq. m.) 4.5
Slide 15: Banking Operations
STME a. Sh CORPORATION a 4 A LLL. oe “oe Banking Operations Guy KE: we
Slide 16: Rankings
Rankings Rank/Bank Assets % share (Q1 2009) (Php billion) 1 BDO 801.1 15.0 2 Metrobank 755.6 14.2 3 BPI 620.6 11.6 4 Landbank 427.3 8.0 5 PNB 279.1 5.2 6 RCBC 267.2 5.0 7 DBP 263.5 4.9 8 Union Bank 213.4 4.0 9 China Bank 205.3 3.9 10 Citibank 191.7 3.6 Source: BDO’s Highlights of the Philippine Comm
Slide 17: Rankings
Rankings Total Deposits Net Loans and Receivables 1Q09 1Q08 Inc/ 1Q08 Rank/Bank 1Q09 1Q08 Inc/ 1Q08 Rank/Bank (Pbn) (Pbn) (Dec) Rank (Pbn) (Pbn) (Dec) Rank 1 BDO 634.8 462.6 37% 3 1 BDO 454.0 316.9 43% 2 2 Metrobank 554.8 493.5 12% 1 2 Metrobank 388.6 337.4 15% 1 3 BPI 518.0 475.7 9% 2 3 BPI 321.0 2
Slide 18: BDO Unibank
BDO Unibank 1H09 Growth Key 2009 Business Strategy: Financial Highlights (Php bn) (y/y) Income Generation Net Interest Income 14.3 32% Focused loan growth & Other Income 7.0 - improvement in quality of earnings Net Income 2.1 62%1 Growth in recurring fee Assets 790.0 17% income Funding Capital 61.5
Slide 19: China Bank
China Bank Growth Key 2009 Business Strategy Financial Highlights 1H09 (y/y) Focus on sound balance Net Interest Income 4.0 32.0% sheet -- quality loans Other Income 2.0 52.4% Portfolio strategy based on Net Income* 2.0 38.8% clear risk limits Assets 213.2 12.2% Implement network Capital* 28.6 10.3%
Slide 20: Property Operations
7@ul . Property Operations ‘wi
Slide 21: SM Land Inc.
SM Land Inc. Residential Commercial Leisure 44% 67% 94% SM Mall of Asia Development Costa del Hamilo Complex Corp. Build-to-Suit Highlands Prime Projects
Slide 22: Emerging Business
Emerging Business An emerging 1H09 1H08 % business for SM, (Php bn) (Php bn) Chg the property group now Sales 4.4 3.2 37% derives strong revenue and Net Income 1.2 0.7 80% earnings growth from residential, commercial and Net Margin (%) 28% 21% -- resort * Based on unaudited financial statements deve
Slide 23: Property Group
Property Group Profiles as of Jan-June 2009 Sales Profile Net Income Profile Commer- Commer- cial cial Properties Propertie 21% s 26% Tourism, Tourism, 11% 6% Residen- Residen- tial, 68% tial, 68%
Slide 24: SMDC Project Brief
SMDC Project Brief Year Units Units % % As of 30 June 2009 Started for sale* sold* sold complete 100%1 Chateau Elysee 2003 2,136 1,580 74% 58% 2 Mezza 2006 2,330 2,189 94% 97% Lindenwoods 2006 390 102 26% 98% Berkeley 2008 1,280 1,123 88% 40% Grass 2008 1,870 1,762 94% 39% Field 2008 304 210 69% 45%
Slide 25: Leisure and Tourism Development
Leisure and Tourism Development Hamilo Coast: Endowed with 13 natural coves, 32 kilometers of coastline, thriving marine sites and vast woodlands. With conservation and sustainable ecotourism in mind, Hamilo has been masterplanned for a 30-year development into a series of mixed-use coastal and inla
Slide 26: Pico de Loro: Sales Summary
Pico de Loro: Sales Summary Total As of Units Units % % Sales 30 June 2009 for sale Sold Sold Complete (Php mn) Jacana 943 246 226 92% 79% Myna 983 246 220 89% 45% Carola 139 248 34 14% -- Miranda 391 248 71 29% -- Beach Club Club Shares 226 4000 524 13% is 98% complete Grand Total 2,682
Slide 27: Hotel and Entertainment
— GW gonegairion yh 7 a ~ MW, 4 yy) = any - Hotel and Entertainment
Slide 28: Hotels and Entertainment
Hotels and Entertainment A new core business for SM Investments that will be involved in Hotel development Exhibition and convention centers Sports arena
Slide 29: Second Half 2009
Second Half 2009 Capex of Php16.0 bn Expansion Retail : 12 stores Malls : SM City Rosario in Cavite, and SM Supercenter Pamplona in Las Piñas Property Projects • Launch of 6 residential projects • Completion of the Hamilo Country Club • Ongoing TwoE-Com project Hotels • Launch of Radisson MOA projec
Slide 30: 1st Half 2009 Investor Presentation
1st Half 2009 Investor Presentation 13 August 2009 Except for historical financial and operating data and other information in respect of historical matters, the statements contained herein are “forward-looking statements”. Any such forward-looking statement is not a guarantee of future performance