SM Prime Delivers ₱48.8 Billion Profit in 2025 on Strong Commercial Portfolio and Cost Discipline
SM Prime Holdings, Inc. (SM Prime) reported a 7% increase in net income to ₱48.8 billion in 2025, up from ₱45.6 billion the previous year, as steady commercial property revenues and tighter cost controls strengthened overall profitability.
Consolidated revenues reached ₱141.1 billion, marginally higher than ₱140.4 billion in 2024. The company’s diversified portfolio continued to anchor performance, with its mall business contributing ₱85.1 billion, equivalent to 60% of total revenues. The residential segment accounted for ₱42.5 billion or 30%, while hotels and convention centers generated ₱8.5 billion (6%), and offices and warehouses added ₱5.4 billion (4%).
Commercial property revenues, which include rental income from malls, offices, hotels, and other establishments, rose more than 6% year-on-year to ₱98.6 billion from ₱92.6 billion, reinforcing the resilience of SM Prime’s recurring income base.
President Jeffrey C. Lim attributed the earnings growth to disciplined execution and operational efficiency. He noted that tighter cost management enabled the company to protect margins and convert modest topline growth into stronger bottom-line results.
Total costs and expenses declined 4% to ₱69.4 billion from ₱72.4 billion, driven by lower operating expenses, film rentals, insurance, and other overhead items. The reduction in costs played a key role in supporting profitability despite relatively flat revenue growth.
Fourth-quarter results reflected a similar pattern. Net income remained steady at ₱11.6 billion even as revenues declined 7% to ₱37.7 billion, largely due to softer real estate sales. However, a nearly 12% reduction in quarterly costs and expenses to ₱17.9 billion offset the impact of lower revenues.
SM Prime sustained its investment momentum in 2025, allocating ₱81.9 billion in capital expenditures, slightly higher than the ₱81.3 billion spent in 2024. The bulk of investments were directed toward mall expansions, residential developments, and integrated estate projects, with additional funding channeled to office, hotel, and convention center developments.
The company closed the year with a healthy balance sheet. Its net debt-to-equity ratio stood at 46:54, while interest coverage remained strong at 6.61 times. Total assets expanded 7% to ₱1.1 trillion from ₱1 trillion, with investment properties accounting for 61% of the portfolio. Cash and cash equivalents totaled ₱27.6 billion at year-end.
Looking ahead, management acknowledged that 2026 may present new challenges but expressed confidence that disciplined execution and a sharper focus on customer experience will help sustain growth momentum.