Macau is a winner for Las Vegas Sands, helping boost earnings by 80 percent
Las Vegas-based Las Vegas Sands, operator of the Venetian and Palazzo resorts on the Strip and properties in Macau and Singapore, reported its third-quarter earnings Thursday.
Company: Las Vegas Sands Corp. (NYSE: LVS)
Revenue: $3.57 billion (up 31.7 percent from the third quarter of 2012). Strong gaming volume drove cash flow in Macau up 60.8 percent to $784.3 million.
Earnings: $809.3 million (up 81.9 percent from the third quarter of 2012). The Venetian Macau had a 91.8 percent occupancy rate, 2.2 percentage points off the third quarter of 2012, but an average daily room rate of $242, 6.6 percent more than last year.
Earnings per share: 76 cents (up 80.9 percent from third quarter of 2012).
Quote: “The prudent management of our cash flow, including the ability to increase the return of capital to shareholders while maintaining a strong balance sheet and ample liquidity to invest in future growth opportunities, remains a cornerstone of our strategy. We are the leaders in the industry (in Macau) and we’re growing faster than the market in Macau. I couldn’t be more confident about our continued success.” — Sands Chairman and CEO Sheldon Adelson
What it means: Las Vegas Sands had another record quarter with revenue from Macau leading the way for the company. Company officials attribute their Macau success to the city’s gradual shift from day-trip destination to a resort for overnight stays — and Sands has the most hotel rooms in the market.
There’s more growth on the horizon with the new Parisian property construction ahead of schedule and opening scheduled for 2015, the opening of a new high-speed rail line to central China, and the 2016 completion of the Hong Kong-Zhuhai-Macau Bridge that will enable motorists access from the Hong Kong airport to Macau in 20 minutes.
Sands also is actively watching the political scene in Japan, where the government is considering gaming and the company is prepared to build new resorts in Tokyo and Osaka. The company also is seeing growth in South Korea.
In Las Vegas, revenue was up 2.9 percent to $375 million with rooms, food and beverage, retail and convention business picking up the slack for declining gaming revenue, which was off 2 percent for the quarter.
Occupancy at the Venetian and Palazzo was up 0.3 percentage points to 87.6 percent, and the average daily room rate was up 2.6 percent to $196 a night.