LVS registers “solid growth” in Macau operations

Las Vegas Sands Corp. saw its net income surge by 41.3 per cent year-on-year to US$578 million (MOP4.62 billion) for the first quarter of the year, as the group’s business in the MSAR registered ‘solid growth.’
According to the company’s first quarter results, the group’s total net revenue increased 14.3 per cent year-on-year to US$3.11 billion whilst consolidated adjusted property EBITDA rose 24.9 per cent to US$1.15 billion from one year ago.
“During the quarter, we again generated strong cash flow across all of our operations, with solid growth in both Macau and Las Vegas . . . After a challenging period, the Macau market is growing again and its growth rate has been accelerating for three consecutive quarters,” said group Chairman and CEO Sheldon Adelson in a conference call.
In Macau, Sands China Ltd. posted an increase of 11.9 per cent in net income on a U.S. GAPP basis, totalling US$349 million. Total net revenue of the local arm also jumped 15.3 per cent year-on-year to US$1.88 billion whilst adjusted Property EBITDA increased 20.5 per cent to US$624 million.
According to Mr. Adelson, the growth in Macau operations was driven by a notable increase in mass gaming revenue. “We experienced broad-based gaming growth across both premium mass and mass segments,” he said.
He claimed the group’s mass gaming table revenue in Macau registered a growth of 18 per cent in the quarter, up from growth of 16 per cent in the fourth quarter of 2016, adding the growth in revenue was attributable to The Parisian Macao.
For the period, the group’s latest casino-resort in Cotai that opened last September raked in US$51 million in adjusted property EBITDA, and US$318 million in revenue, of which some US$279 million derived from the gaming sector.
Meanwhile, The Venetian Macao saw its revenue slightly decrease by 1.1 per cent year-on-year to US$741 million from US$749 million one year ago although its adjusted property EBITDA reached US$289, an increase of 7.8 per cent year-on-year.
For non-gaming, Mr. Adelson claimed the group’s total occupied room nights in the MSAR increased 13 per cent compared to the first quarter of 2016.
“It’s important to note that 8,000 new hotel rooms in Cotai have now been successfully absorbed in the Macao market over the last two years,” he said. “Despite the new competition on Cotai, we’ve retained our scale and critical mass advantages during peak periods.”

During the conference call, LVS president and COO Robert Goldstein said the group remains positive on the Macau market given the city’s upcoming infrastructural improvements such as the opening of the Hong Kong Zhuhai Macau Bridge and the Pac On Ferry Terminal.
“We view Macau in the most favourable way. We see a fixed amount of capacity in the gaming side, perhaps a little less so in the lodging side. We see more visitation, more penetration from Mainland China into Macau. We see the emergence of a stronger and growing Cotai,” he said. “We couldn’t be more positive in how we see the market. But we see it as based on capacity, based on our ability to grow our market share in the most important section which would be the mass tables and slot machines.”
Meanwhile, Mr. Adelson revealed in the conference call that “We have been looking at other countries in Asia for a long time…We’re certainly looking at Korea. We are looking at Vietnam,” adding the company is observing how the gaming industry in the two countries will develop, and whether they are allowing locals into casinos.
Meanwhile, for Japan, Mr. Adelson claimed he was told by “some Japanese” that “the Japanese Government may even allow us, one operator, meaning LVS, to have an interest in more than one [Integrated Resort].”
“We’ve been told that we’re in pole position in more than one location . . . I don’t know whether or not the Japanese Government will allow a foreign company to have two IR locations. But then again, there’s nobody out there that’s an effective competitor with us,” he claimed.