SM Investments Corporation President s Report 28 April 2010

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1 SM Investments Corporation President s Report 28 April SMIC President s Report Target Achieved with Proper Planning and Timely Execution Core Business 2009 Earnings Growth Net Income Profile Retail 28% Malls 10% Banks 99% Property/ Tourism 37% Property/ Tourism Banks 28% Retail 35% Malls 26% 2 SMIC President s Report Net Income Grew 14% % Chg Revenues (Php bn) % Gross Profit (Php bn) % Net Other Income (Php bn) % Net Income (Php bn) % EPS (Php)* % Return on Equity (%)* 13.6% 12.9% -- Interest Cover (x) % EBITDA (Php bn) % EBITDA Margin (%) Net Margin (%) 10.0% 9.5% -- 3 SMIC President s Report

2 Net Assets Expanded by 13% % Chg Total Assets (Php bn) % Current Assets (Php bn) % Total Liabilities (Php bn) % Stockholders Equity (Php bn) % Book Value/Sh % Current Ratio (x) 2.17: : 1 -- Debt/Assets Ratio 34.4% 30.5% -- Debt/Equity Ratio 94.3% 81% -- Net Debt (Php bn) % 4 SMIC President s Report Retail Operations 5 SMIC President s Report Focused Merchandising and Continued Renovations SM Retail, Inc. Non-Food Group SM Department Stores 36 Department Stores 15 in Metro Manla 21 in Areas Outside MM NSA: 378,034 sqm. 6 SMIC President s Report

3 Aggressive Expansion of SaveMore Stores SM Retail, Inc. Food Group SM Supermarkets 52 Stores 27 SaveMore 26 Supermarkets 24 stores in M.M. 28 stores in areas outside M.M. NSA: 180, sqm. SM Hypermarkets 19 Hypermarkets 13 stores in M.M 6 stores in areas outside M.M. NSA: 150, sqm. Makro 12 Wholesale outlets 4 stores in M.M. 8 stores in areas outside MM NSA: 90,253 sqm. 7 SMIC President s Report Overall Retail Earnings Grew 26% % Chg Sales (Php bn) % Net Income (Php bn) % Net Margins 3.6% 3.0% -- ROE 34% 29% -- No. of Stores % 8 SMIC President s Report Mall Operations 9 SMIC President s Report

4 10 SMIC President s Report New Malls and Mall Expansion SM City Naga SM Pamplona SM Naga SM Pamplona SM City Rosario SM North EDSA SM City Fairview SM City Rosales SM North EdsaSky Garden SM Supermalls in the Philippines Mall Trivia: 36 SM malls with a GFA of 4.5 million sqm. and home to 11,957 tenants; Has over 200 cinemas with 131,666 seats. Average foot traffic of over 2.5 mn per day or. 900 mn p.a. 11 SMIC President s Report SM Lifestyle Center Xiamen 12 SMIC President s Report

5 13 SMIC President s Report SM China Malls: 577,141 sqm. SM City Xiamen and Lifestyle Center: 238,150 sqm SM Chengdu: 169,407 sqm SM Jin-Jiang: 169,584 sqm Mall Operations Earnings Grew 10% in 2009 Twelve months performance: Same mall sales: 5% Operating margin: 52% EBITDA margin: 68% Net income margin: 34% 2009 (Php bn) % chg Revenues % Rental Fees % Operating Expenses % Income from Operations % Net Income % EBITDA % 14 SMIC President s Report SM Malls: 234,228 SQM. SM Calamba: 41,394 sqm SM San Pablo: 34,409 sqm SM Tarlac: 103,340 sqm SM Novaliches: 55,085 sqm 15 SMIC President s Report

6 16 SMIC President s Report Banking BDO s Profits Soared by 173% Financial Highlights 2009 (Php bn) 2008 (Php bn Growth (y/y) Net Interest Income % Other Income % Net Income % Assets % Capital % Deposits % Gross Customer Loans % ROE (%) 9.7% 3.8% NPL (%) 3.2% 4.0% NPA (%) 8.6% 9.7% Net Interest Margin (%) 4.1% 3.7% CAR (%) 12.4% 13.8% 17 SMIC President s Report China Bank Delivers 41% Profit Growth Financial Highlights 2009 (Php bn) 2008 (Php bn Growth (y/y) Net Interest Income % Other Income % Net Income* % Assets % Capital* % Deposits % Loans ** % ROE (%) 15.4% 12.0% NPL (%) 4.2% 5.1% NPA (%) 4.1% 5.0% Net Income Margin (%) 4.2% 3.8% CAR (%) 12.8% 13.5% * Att ributable to equity holders of the p arent; ** Gross cu stomer loan s, NPL( %) based on BSP formula, NPA ( %) NPA/Tot al Asset s NIM-defined as Net Int erest M argin 18 SMIC President s Report

7 19 SMIC President s Report Property Development Property Business Gains More Traction % Chg Sales (Php bn) % Net Income (Php bn) % Net Margin (%) 23% 26% -- Residen -tial 70% Net Income Profile Commercial Properties 24% Tourism 6% 20 SMIC President s Report As SMDC Gains More Momentum (In Php billion) % chg Revenues from Real Estate Sales % Gross Profit from Real Estate Sales % Net Income from Real Estate % Net Income after Tax ,174% Return on Equi ty (%) 17% 1% -- Interest Cov er (x) % EBITDA (Php bn) % EBITDA M argin (%) 41% 16% -- Net M argin (%) 35% 2% SMIC President s Report

8 22 SMIC President s Report Aggressive Expansion in 2008 and 2009 Field Grass Sea 2009 Princeton Light Sun Jazz Wind 22 Pico De Loro Shows Steady Growth in Sales 2009 Sales (P mn) Units for sale % Sold % Complete Jacana % 98% Myna % 72% Carola % 9% Miranda % 8% Club Shares 295 4,000 16% SMIC President s Report Commercial Properties Group Constructs TwoE-Com Center Building Features: GFA 107,683 sqm NLA 59,485 sqm Estimated time of completion Q Amenities include: - Over 8,000 sqm of commercial and retail space complemented by a landscaped garden parking slots - 20 elevators 24 SMIC President s Report

9 25 SMIC President s Report Hotels and Conventions Hotels and Conventions Newest core business that aims to further broaden SM s range of tourism-related products and services Further strengthen Group synergies and added value within SM businesses by: Providing additional foot traffic to SM malls and stores Harnessing value of existing land assets Creating new avenues for SM s brand franchise Capitalize on SM s dominant position in the expo and convention businesse s Product offerings Upscale and boutique hotels Exhibition convention centers Sports Arena 26 SMIC President s Report Group Capex for Full-Year 2010 Capex (Php bn) Proj ects Retail stores Malls 12.1 Banks malls in the Phils.; One mall in China Branch expansion, renov ation, IT enhancements Property 15.0 Hotels and Convention 4.5 Total Residential projects; Tw oe-com; PDL con do s and countr y club, Hamilo ferry terminal and causew ay M OAC Radisson, Sports Arena Complex; M id-scale boutique hotels; Pico Sands 27 SMIC President s Report

10 SM Foundation 28 SMIC President s Report Emergency Response Program: Operation Tulong Express Post Ondoy and Pepeng 29 SMIC President s Report Education: Over 800 College Scholars Nationwide College scholars are provided with: Free tuition, books, allowance, medical benefits, summer jobs, social activities, retreats, job fairs, etc. 30 SMIC President s Report

11 Makeover of 10 Government-owned Health Centers Before After Before After Before After Wellness Center for Children - Bulacan Wellness Center for the Elderly Quezon City Wellness Center for the Elderly - Iloilo 31 SMIC President s Report Kabalikat sa Kabuhayan Provided Free Training to 1,259 Farmers Three mon ths training pro gram using new farming technology for high-yield fruits and vegetables include propagation, irrigation, and fertilizer propagation among others. Products of the graduates w ill be carried by SM food stores. 32 SMIC President s Report SM Investments Corporation President s Report 28 April SMIC President s Report

12 Thank you. Except for historical financial and operating data and other information in respect of historical matters, the statements contained herein are forward-looking statements. Any such forward-looking statement is not a guarantee of future performance and involves a number of known and unknown risks, uncertainties, and other factors that could caus e the actual performance, financial condition or results of operation of SM and its subsidiaries to be materially different from any future performance, financial condition or results of operation implied by such forward-looking statement. 34

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