SM Investments Corp. is looking to renewable energy and logistics to become bigger engines of portfolio growth as the conglomerate prepares for a possible decline in the segment’s contribution after Atlas Consolidated Mining and Development Corp. is transferred to another listed SM entity.
SMIC President and CEO Frederic C. DyBuncio said portfolio investments, currently led largely by Atlas and 2GO Group Inc., contributed 11 percent to the conglomerate’s first-half net income. That share could ease next year if Atlas moves out of SMIC, putting more pressure on other businesses to carry the portfolio.
“I think for really growing our logistics business and the renewable business,” DyBuncio said, pointing to six renewable energy concessions that SMIC is developing.
The strategy underscores SMIC’s effort to build new earnings drivers while recycling capital toward businesses with longer-term growth potential.
2GO is already showing momentum, with revenue rising across all categories in the first half as passenger volumes increased and e-commerce supported logistics demand.
Renewables, meanwhile, could provide a more structural growth opportunity as SMIC develops its six concessions.
The portfolio gains helped SMIC lift first-half net income by 8 percent to P45.9 billion, while consolidated revenues rose 6 percent to P339.2 billion.
DyBuncio said the group remains upbeat about the second half, citing its diversified portfolio, prudent balance sheet, and disciplined capital allocation as buffers against economic uncertainty.
SMIC Executive Vice President and CFO Franklin C. Gomez said improving economic conditions could provide another tailwind, particularly if consumer spending strengthens.
He noted that expected second-half economic growth is higher than in the first half, while easing inflation and low unemployment should support consumption.
The equation is fairly straightforward for SMIC. As one portfolio star potentially leaves the stage, the conglomerate is cultivating new ones.
Renewables offer long-term heft, while 2GO provides a more immediate growth story, giving SMIC a mix of emerging and established businesses to keep the portfolio humming.
