The country’s largest conglomerate SM Investments Corp. turned unprofitable in the second quarter as the coronavirus (COVID19) pandemic-induced lockdown measures bludgeoned its shopping mall, banking and retailing businesses.
SMIC’s consolidated first semester net income slid by 69 percent year-on-year to P7.1 billion, the conglomerate disclosed to the Philippine Stock Exchange on Wednesday.
Coming from an earlier reported P9 billion net profit in the first quarter, this implied a reversal to a net loss of P1.9 billion in the second quarter.
Consolidated revenues decreased by 21 percent year-on-year to P185.5 billion in the first half. The property and banking businesses accounted for 61 percent and 34 percent of net income while retailing contributed 5 percent.
“Our half year financial results are within our overall expectations, given the context of the lockdown due to the COVID-19 outbreak which had a greater impact in the second quarter. The results also reflect the group’s continued financial prudence and conservative balance sheet after our banks made substantial provisions for potential customer delinquencies,” SMIC president and chief executive officer Frederic DyBuncio said.
“Our food retail and residential property businesses have continued to perform well despite the pandemic as have the core businesses of our banks. The current environment has been most challenging for our non-food retail and mall operations which have adapted quickly to new customer needs and critical safety considerations. All our businesses will continue to prioritize health and safety as well as convenience for our customers and stakeholders,” DyBuncio added.
SM Retail eked out a net income of P522 million in the first semester versus its P5.7-billion pre-COVID19 bottomline in the same period last year. Six-month revenues fell by 18 percent year-on-yer to P139.2 million.
Coming from a P1.2-billion reported net profit in the first quarter, SM Retail incurred a net loss of about P678 million in the second quarter with the mandatory shutdown of its shopping malls during the COVID19-induced lockdown.
It was earlier reported that SM Prime Holdings Inc.’s first semester net profit had dropped by 46 percent year-on-year drop to P10.4 billion due to the waiver of shopping mall rental fees and discounts given to tenants. Second quarter net profit dwindled by 80 percent year-on-year to around P2.1 billion in second quarter.
BDO Unibank saw a 78.6 percent year-on-year drop in first semester net profit as higher provisioning for possible corporate loan delinquencies resulted in a second quarter net loss. It incurred a second quarter net loss of P4.5 billion, a reversal of the net profit of P10.39 billion in the same period last year.
China Banking grew its second quarter net profit by 27 percent year-on-year to P3 billion, bucking the downturn seen by other banking peers. This brought six-month net profit to P5.2 billion, up by 24 percent year-on-year, even as the bank jacked up provisions for probable credit losses.
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.
For feedback, complaints, or inquiries, contact us.