Las Vegas Sands reports second-quarter profit, record revenue
Marina Bay Sands
VEGAS INC Coverage
Las Vegas Sands swung to a profit during the second quarter of 2011 and reported record-breaking revenue, the casino operator said today.
The company reported net income of $367.6 million during the second quarter of 2011, or 45 cents per share, compared with a net loss of $4.7 million, or 1 cent per share, in the second quarter of 2010.
Net revenue for the quarter totaled $2.35 million, an increase of 47 percent from $1.59 billion in the same period last year. Las Vegas Sands Chairman Sheldon Adelson said on today's earnings conference call that revenue generated during the second quarter of 2011 set a record for the company.
The company’s two Las Vegas resorts, the Venetian and Palazzo, generated $92.9 million in earnings before interest, taxes, deprecation and amortization in the second quarter of 2011, another record for the Las Vegas Sands, Adelson said.
Occupancy at the resorts was 97 percent for the second quarter, up from 70 percent last year. Room rates at the Venetian and Palazzo also increased 4.2 percent from $192 to $200 during the year-over-year period. Room revenue increased by more than 18 percent from last year.
Casino revenue at the Venetian and Palazzo totaled $105 million in the second quarter, up 2 percent from $103 million in the second quarter of 2010. Food and beverage revenue rose more than 12 percent from $56.4 million in the second quarter of last year to $63.4 million in the second quarter of this year.
Business continued to boom in Asia for Las Vegas Sands during the second quarter. In Macau, net income increased to $267.4 million in the second quarter this year, compared with $133.6 million in the second quarter last year. In Macau, net revenue increased more than 16 percent to $1.21 billion, compared with $1.04 billion in the second quarter of 2010.
Las Vegas Sands President and Chief Operating Officer Michael Leven said on today's call that the company is partnering with two international hotel brands to manage a 600-room, five-star hotel and 1,200-room, four-star hotel on Lot 5 on the Cotai strip. Leven said the resorts will include 11 restaurants and bars, 300,000 square feet of meeting space and more than 100,000 square feet of casino space. The resorts are scheduled to open during the first quarter of 2012.
On Lot 6A, Leven said the company is scheduled to open a 2,000-room, Sheraton-branded hotel tower and casino in the third quarter of 2012. Another Sheraton hotel tower is planned for Lot 6B.
Las Vegas Sands’ competitor Wynn Resorts also has plans in the works for a resort on the Cotai strip but has yet to break ground. Chairman and CEO Steve Wynn said on his company’s earnings call last week that the project is drawn and rendered and the process is “moving along nicely.” Wynn said the resort will include 1,500 suites, 500 table games, a theater and public entertainment. He did not give a timeline for development.
In Singapore, Marina Bay Sands, which opened in April 2010, net revenue totaled $737.6 million. The resort produced a record $405.4 million of adjusted EBITDA for the second quarter, the company said.
Las Vegas Sands said Marina Bay Sands built momentum during the quarter as additional dining, entertainment, meeting space and retail offerings came online throughout the quarter.
“Now that we’ve entered our second year of operations, it is increasingly clear that it is becoming the most successful integrated resort in the history of the hospitality, gaming and entertainment industry,” Adelson said.
Las Vegas Sands also announced three appointments for its Asian operations. George Tanasijevich has been named chief executive of Marina Bay Sands and Benny Zin is chief operating officer. Ed Tracy has been promoted from COO of the company’s China operations to CEO.