Thursday, 7 May 2009

Philippines' SM marks new milestone with 100 stores, and counting

Honey Madrilejos-Reyes
Business Mirror

SM Investments Corp. (SMIC), the holding firm for all the investments of the Sy group, said on Wednesday its retail network has grown to 100 stores, reaching another milestone in its 51 years of history.

The number of its SM Department Stores has climbed to 34 after the opening on May 1 of an outlet in SM City Naga; SM Supermarkets with 25; SaveMore, 14; SM Hypermarkets, 13; and Makro, 14.

The company earlier announced the opening of two more department stores—one Supermarket; eight SaveMore branches; and six Hypermarkets. “SM retail’s sustained expansion nationwide fits well with the country’s consistently robust and dynamic consumer sector. Domestic consumer spending, supported to a large extent by remittances from overseas Filipinos, continues to grow. Thus, with the opening of SM’s 100th retail outlet, we intend to further enhance our product and service delivery, for the benefit of the millions of consumers,” said SMIC president Harley T. Sy.

The group’s retail business is divided into two main segments, namely, the nonfood group, which is principally SM Department Stores; and the food group, composed of SM supermarkets, SaveMore stores, SM Hypermarkets, and Makro outlets. Earlier, the group announced a capital spending of P31 billion this, 30 percent more than what it spent in 2008, to bankroll continued expansion across all business segments. The spending will be funded by internally generated cash and the proceeds from the planned sale of fixed rate notes worth up to P10 billion.

Bulk of the group’s spending will go to its shopping mall development arm SM Prime Holdings, P7.2 billion for property unit SM Development Corp., P5.1 billion for SM Hotel and Entertainment, P2.7 billion for office buildings and ferry terminal project, and P1.6 billion for the condominium development in Hamilo Coast. The balance will be allotted for the retail business.

“We will pursue our expansion plans for 2009 with grater focus on areas that we think can make us stronger when the crisis passes. These are the areas we know best and continue to provide long-term growth opportunities, namely, retail, mall operations, banking and property development,” said Sy.

And while it recognized the challenges pose by the current environment, SMIC is still bullish of meeting a 12-percent to 14-percent growth in net profit this year.

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