Mall developer and operator SM Prime Holdings Inc. posted an 8 percent increase in net income in the first half the year to P3.4 billion defying weak market expectations due to the global crisis.

Consolidated revenues  rose 15 percent to P9.6 billion compared to P8.4 billion in the first six months of 2008. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased 13 percent to P6.6 billion, for an EBITDA margin of 69 percent.

SM Prime’s rental revenues continued to contribute the biggest at P8.4 billion, a 17- percent increase from last year’s P7.2 billion with the addition of spaces from malls that opened in 2008 namely SM City Marikina, SM City Rosales, SM City Baliwag, and SM City Naga which opened in May 2009 as well as the expansion of SM North EDSA, SM Megamall and SM Fairview.  New malls and expansions in 2008 and 2009 added 477,000 square meters to the company’s total gross floor are (GFA), with an average occupancy rate of 96 percent.

Cinema sales rose by 5 percent to P0.93 billion in January to June  due to more blockbuster movies shown this year, SM Prime said in a statement.

Income from operations increased by P5.1 billion, up 12 percent from P4.6 billion last year. While operating expenses also grew by 20 percent to P4.5 billion due mainly to the opening of new malls. In gross revenues, the three SM malls in China contributed P0.5 billion, 5 percent of total consolidated operating revenues. This translates to P60 million or 2 percent of total consolidated net income.

SM’s major tenants in China include Walmart, SM-Laiya Department Store, Giordano, Watsons, McDonald’s and KFC among others.

'We are pleased to have met our targets for the first half of this year in spite of the ongoing global financial crisis. Our results reinforce our belief in the resilience of the Philippine economy. We remain steadfast in pursuing our growth and expansion programs in order to better serve our millions of loyal customers,' said SM Prime president Hans  Sy said.

Pepee Reyes, assistant vice president for finance, said the company is expecting a double digit topline growth by yearend.

SM Prime will be opening later in the year SM City Rosario in Cavite and SM Supercenter Pamplona in Las Piñas to end the year with a total of 36 malls with an estimated GFA of 4.9 million sqm. SM  Prime posted an 8 percent increase in net income in the second quarter to P1.7 billion. Revenues reached P5 billion, a 14 percent hike year-on-year. EBITDA in Q2 grew 13 percent to P3.4 billion and an EBITDA margin of 69 percent.