Las Vegas Sands has tough 4th quarter in China, but profits still up

Kin Cheung / AP

Las Vegas Sands casino sits behind the Fishermans Wharf in Macau in this Feb. 7, 2006, photo.

Las Vegas Sands, the casino company that controls the Venetian and Palazzo on the Strip, reported its fourth-quarter and full-year earnings today.

Company: Las Vegas Sands Corp. (NYSE: LVS)

Revenue: $3.42 billion for the fourth quarter, a 6.6 percent decrease from the same period last year. For the year, the company’s net revenue increased 5.9 percent to $14.58 billion.

Earnings: $721.3 million for the fourth quarter, a 24.9 percent increase from 2013’s fourth quarter. For the year, earnings increased 23.2 percent to $2.84 billion.

Click to enlarge photo

Las Vegas Sands Corp. CEO Sheldon Adelson speaks at the Global Gaming Expo, Wednesday, Oct. 1, 2014, in Las Vegas.

Earnings per share: 90 cents for the fourth quarter, a 28.6 percent increase from 2013’s fourth quarter. For the year, earnings per share increased 26.2 percent to $3.52.

What it means: Sands is heavily concentrated in Asia, where it operates casinos in Macau and Singapore. And Macau, which has been a booming for years, had its worst year for casinos in 2014.

The Macau slowdown was evident in some of Sands’ financial figures.

Net revenue for Sands China in the fourth quarter was $2.12 billion, a 16.2 percent decline compared to the same quarter in 2013. At the same time, Sands China’s earnings declined 18.3 percent to $535.3 million in the fourth quarter.

Nonetheless, Sands CEO Sheldon Adelson remains undeterred. He’s taken on the role of CEO of Sands China, too, following the retirement of Edward Tracy.

“Despite some obvious challenges in the Macau market, we delivered a strong set of financial results,” Adelson said in a conference call with analysts. “Did I hear anybody talk about things slowing down?”

To support his case for optimism about Macau, Adelson pointed to a number of encouraging signs, including strong visitation from mainland China and his company’s dominance in nongaming services. He said Sands produces more nongaming revenue than Macau’s other casino operators combined.

In Las Vegas, Sands reported revenue of $362.6 million for the quarter, a 6 percent decline from last year. Casino, hotel room, and food and beverage revenues were all down compared to the fourth quarter of 2013, though the company did see a 7.5 percent increase in convention, retail and other revenue.

Quote: “We remain focused on the consistent execution of our global growth strategy, which leverages the power of our unique convention-based Integrated Resort business model. Our convention-based Integrated Resort business model appeals to the broadest set of customers, generates the most diversified set of cash flows, and brings the greatest economic and diversification benefits in the industry to the regions in which we operate. We are confident that the continued execution of our strategy will further extend our position as the global leader in Integrated Resort development and operation and enable us to deliver strong growth in the future.” — CEO Sheldon Adelson in earnings press release​

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