SM Prime to issue P1.5-B 5-year bonds for mall investments

SM Prime Holdings Inc., the country’s largest shopping Mall operator, plans to issue P1.5 billion worth of five-year bonds to finance its mall investments and other corporate purposes.

Industry sources said the bonds will mature in July 1, 2010 and will be issued at par. The notes, however, will not be issued to more than 19 primary institutional lenders.

Benefiting from the strong performance of its mall operations, SM Prime earlier declared P2.3 billion in cash dividends, equivalent to half of its prior year’s net profit.

This translates to a dividend rate of P0.233 per share. Shareholders on record as of May 25 were entitled to the dividend which was paid on June 20.

"This cash dividend is declared in fulfillment of our improved dividend policy. With our expansion plans in the pipeline, we look forward to consistent growth in revenues and profits, and are prepared to extend reasonable dividends to our investors who invested in the company all these years," SM Prime president Hans Sy said.

SM Prime’s net income in 2004 stood at P4.62 billion, 11 percent higher than the previous year. Company officials expect to sustain the gains this year with the continued construction of new malls.

The company plans to open eight shopping malls this year and in 2006, including its biggest mall to date, the SM Mall of Asia, with a total floor area of 454,000 square meters in the Manila Bay area.

The Mall of Asia, to be opened in December, is set to be the centerpiece of a 60-hectare central business park that the SM group plans to develop in the Manila bay area.

This year, SM Prime plans to spend P5.5 billion to P6 billion to fund the construction of new malls and further beef up its landholdings from the current 187 hectares all over the country.

Aside from SM Mall of Asia, other malls expected to open this year include SM Supercenter Molino, SM City San Lazaro, and SM Supercenter Valenzuela.