During its annual meeting on Wednesday, company leaders struck a steady tone, reaffirming the disciplined strategy that has delivered consistent results and helped turn the P1.1-trillion holding company into one of the country’s largest and most profitable conglomerates.
SM leaders are staying the course, reinvesting in core businesses, doubling down on provincial expansion, and raising bets on portfolio plays in clean energy and logistics.
SM president and CEO Frederic C. DyBuncio recalled founder Henry Sy Sr.’s principle of financial discipline during a media briefing after the meeting.
“From the very inception of the SM Group, the founder Henry Sy Sr. has come up with that policy that we all always have a very conservative balance sheet, and that has served us well during the Asian crisis, during the Lehman crisis,” he said.
“We are able to actually continue to grow because our balance sheet, our position has been very manageable and that something we will continue to do,” he said.
“Our founder would always say in any crisis there’s always an opportunity and that will allow us to be able to move if opportunities come up,” he added.
SM leaders cautious, optimistic
“As we look forward to 2025, we remain mindful of the challenges ahead, with high interest rates and a volatile global trade environment in particular,” SM chair Amando Tetangco Jr. and vice chairs Teresita Sy and Henry Sy Jr. said in a joint message to stockholders.
“Yet we remain optimistic. With our unique ecosystem of businesses, our market-leading positions, and our ability to invest boldly in the future, we are confident that we will continue to deliver sustained growth and value to our stakeholders,” they added.
Big picture
SM Investments, which owns banking giants BDO Unibank Inc. and China Banking Corp., malls and condos (SM Prime), and the country’s No. 1 chain of supermarkets, came off a year of record profits of P82.6 billion.
It continues to back its core investments and newer businesses with a capital spending budget of P115 billion in 2025, which is larger than the P100 billion deployed last year.
In early 2025, SM Investments launched the largest share buyback in Philippine history worth P60 billion.
During the stockholders’ meeting on Wednesday, DyBuncio said the record buyback was a vote of confidence in SM’s business and stock, which he described as deeply undervalued.
SM has so far deployed P345 million buying back shares.
Provincial expansion to fuel next growth wave
“I think all of our core businesses will continue to grow, and like we mentioned, most of the growth is going to be in the provincial areas,” DyBuncio said.
SM’s earnings over the past year leaned heavily toward banking, which accounted for 49 percent. This was followed by real estate, where SM Prime plans to go into sprawling integrated estates, and retail.
One of SM Prime’s pioneering projects that made significant progress is its 360-hectare Integrated Property Development in Manila Bay with the Pasay City government, which reached 60 percent “land creation” at the end of 2024.
There’s also a small but fast-growing group of portfolio companies, which include Philippine Geothermal Production Co., 2GO Group, and gaming firm Belle.
Bullish on clean energy
“[A]far as the portfolio is concerned, the renewable energy business is something we really want to continue to grow because it’s something that we need to support,” DyBuncio said.
“The Department of Energy’s goal is to achieve 50 percent by 2040, and I think we do have access to that as far as the concessions and geothermal areas,” he added.
PGPC produces 300 Megawatts (MW) of geothermal steam supply and is developing capacity for another 300 MW in the coming years.
Logistics enables SM’s provincial expansion
Expanding 2GO’s nationwide logistics network is crucial to driving faster growth in the provinces, DyBuncio said.
“For the provincial areas to continue to grow at a high clip compared to what we’re experiencing in Metro Manila, you need logistics to be able to deliver the goods and services that the local communities in those provinces will require,” he explained.
2GO earlier launched two new vessels, boosting connections across 19 ports nationwide.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
