Select Hollywood movies, FIBA World Cup boost SM Prime's earnings

MANILA, Philippine – High ticket sales from select movies and live events such as the FIBA World Cup 2023 helped boost publicly listed firm SM Prime Holdings Corporation’s (SM Prime) revenues in the first nine months of 2023.

Although revenues from its cinema operations and live events ticketing contribute only a small part to SM Prime’s mall business, its topline from this business unit went up from P3.5 billion in the first nine months of 2022 to P7.65 billion in the same period in 2023, or an increase of 119%.

SM Prime Financials: Philippine Malls

In PH billion	1st 9 months 2023	1st 9 months 2022	% Change
Revenues	P47.85	P33.85	41%
– Rent Income	P40.2	P30.36	32%
– Cinema, Ticket Sales, and others	P7.65	P3.5	119%

Source: SM Prime 9M2023 Financial Highlights

The P7.65 billion already exceeds SM Prime’s revenues from cinema and event ticket sales of P6.87 billion in the same period in 2019 or before the COVID-19 pandemic shut down cinemas and live events.

SM has the largest ticketing network in the Philippines, where people can buy tickets for concerts, sports, exhibits and fairs, beauty contests, and other live events even if these are not held in SM venues.

Comparatively, rent income from SM Prime’s malls business, traditionally the biggest contributor to the company’s consolidated revenues, increased 32% or from P30.36 billion in the first three quarters of 2022 to P40.2 billion in 2023.

“Cinemas improved due to high ticket sales from movies shown during the first nine months of the year,” the Sy family-led SM Prime said in a disclosure earlier this week, as cinema, leisure and entertainment businesses fully reopened doors to patrons.

Movies that did well, cited by SM Prime in its quarterly earnings reports this year, were:

Deleter, the only Philippine film cited, was an entry in the December 2022 Metro Manila Film Festival. Awarded Best Picture, Best Director, Best Lead Actress, and Best Cinematography in the annual Christmas holiday film fest, it got an extended run until mid-January 2023. The psychological thriller starring Nadine Lustre reportedly earned P234 million at the box office, and now shows in some streaming platforms such as Prime Video.

Niche markets

Movie-going has declined substantially over the past decade as more people turn to streaming platforms for entertainment. Most Filipinos also can no longer afford to watch movies in cinemas with tickets now selling for at least P300 or around half the minimum daily wage of workers in the National Capital Region.

However, distributors and cinema owners are finding niche markets that are helping bring people back to theaters.

One such market is Japanese anime movies such as The First Slam Dunk. SM Cinema is now exclusively showing City Hunter The Movie: Angel Dust, which started on November 8, Wednesday. It will also be showing The Concierge on November 15, and Digimon Adventure 02: The Beginning, exclusively in select SM Cinemas on December 6.

Some of these anime films have exclusive fan screenings where merchandise related to the movie are sold.

Other anime movies shown this year were: Demon Slayer: The Tunnel to Summer, The Exit of Goodbyes; Doraemon The Movie: Nobita’s Sky Utopia; Crayon ShinChan The Movie: Battle of Supernatural Powers; and Rascal Does Not Dream of a Sister Venturing Out.

Another niche market: concert movies such as Taylor Swift: The Eras Tour , and K-pop concerts such as IU’s The Golden Hour, Kang Daniel: My Parade, and NCT Nation: To the World In Cinemas.

And, despite having many K-drama choices on streaming platforms, film distributors have found that Korean movies have developed a cinema-going niche. Among the Korean movies this year shown in cinemas are the rom-com Honeysweet, disaster film Concrete Utopia, and The Moon, a sci-fi fictional film on Korea’s first lunar exploration mission.

Other movies in the fourth quarter expected to add to Philippine cinema ticket sales in 2023 are local film Five Breakups and A Romance starring Alden Richards and Julia Montes, and Hollywood’s The Marvels (now showing), and The Hunger Games: The Ballad of Songbirds and Snakes opening on November 15.

SM Prime, the Philippines’ largest mall operator/developer, has 85 malls throughout the country, as of October 2023. It also has the most number of cinemas in the Philippines with 382 cinema screens.

FIBA World Cup

Meantime, ticket sales from the FIBA World Cup 2023 and the full comeback of live concerts featuring local and foreign artists also contributed to SM Prime’s earnings.

SM Prime’s Mall of Asia Arena hosted most of the games in the 2023 FIBA World Cup from August 25 to September held for the first time in three countries – Japan, Indonesia, and the Philippines. The Philippines hosted 52 out of the 92 games involving 32 teams.

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Although FIBA World Cup 2023 didn’t beat the nearly 800,000 attendance in populous China’s hosting of FIBA World Cup in 2019, the tournament managed to get a combined attendance of 700,665 in the three host countries, mostly in the Philippines.

The Philippines hosted 16 teams in the first two rounds, while Japan and Indonesia hosted eight each. The final phase of the World Cup (from quarter finals to the final game), brought in more foreign spectators to the country with the addition of four teams (two from the Japan hosting and two from the Indonesia hosting), held at the SM Mall of Asia Arena Manila from September 5 to 10.

When China hosted the 18th edition of FIBA World Cup in 2019 in eight cities, the total number of spectators reached 794,951, an average attendance of 8,641 per game, according to a FIBA Mid-Term Activity 2019-2022 report.

Head, Person, Adult — PUSO. Filipino fans show support for their national team, Gilas Pilipinas, in the FIBA World Cup 2023 co-hosted by the Philippines in August to September 2023. *Rappler file*

“The Philippines have been long known as a basketball-loving nation and they showed that at the World Cup, coming out in droves to not only see their own national team but cheer on their favorite NBA stars. It was in the Philippines that a new World Cup attendance record was set with 38,115 fans flocking to the Philippine Arena for the Philippines’ opening game against the Dominican Republic,” said the Switzerland-based International Basketball Federation (FIBA) in September after the quadrennial competition won by Germany.

“Many wondered what a World Cup in three countries would look like but Indonesia, Japan, and the Philippines gave the world a tournament to remember. There were great games and great storylines to follow in all three host nations. Fans came out to the games and the organization did a good job for the teams, officials, media, and fans alike,” FIBA added.

The Philippines, led by NBA star Jordan Clarkson, won only one game in the FIBA World Cup 2023, beating China 96-75.

SM Prime’s consolidated revenues in the first nine months increased 26% from P73 billion in 2022 to P92 billion in 2023. Mall business accounted for 57% of revenues, residential business (led by SM Development Corporation) 33%, and other business segments 10%. Its consolidated net income went up 37%, from P22 billion to P30 billion in the same period. – Rappler.com