By Ben Blaschke
Las Vegas Sands has released its first quarter 2017 earnings, with strong growth across all of its markets including adjusted property EBITDA at its Macau operations of US$624 million representing a 20.5% increase.
Sands China reported gross gaming revenue of US$1.8 billion – up 12% year-on-year and 3% quarter-on-quarter – and net revenue of US$1.9 billion which was 16% up on the same time last year.
Consolidated adjusted property EBITDA increased by just under 25% to US$1.15 billion, with Chairman and CEO Sheldon Adelson claiming confidence in the growth of the Macau market.
“In Macau, the market overall continues to recover and has exhibited growth in each of the last three quarters, while the compelling attractions and entertainment offerings of our industry-leading Cotai Strip property portfolio, recently expanded by the addition of The Parisian Macao, allowed us to deliver visitation growth of 30% across our property portfolio and to increase our hotel occupancy levels by 440 basis points compared to the year ago quarter,” he said. “Our market-leading critical mass of hotel, retail and entertainment offerings on the Cotai Strip allowed us to grow our mass gaming business by 17% and to expand our adjusted property EBITDA by 20.5% to US$624 million.
“We have invested approximately US$13 billion in Macau since 2002, while consistently contributing to Macau’s diversification and appeal as a business and leisure tourism destination. We continue to lead the market not only in Integrated Resort development, but in the long-term and vital investment in the marketing of Macau as Asia’s leading business and leisure tourism destination.
“We remain confident that our market-leading Cotai Strip portfolio of properties will continue to provide the economic benefits of diversification to Macau, help attract greater numbers of business and leisure travelers, and provide both Macao and our Company with a superior platform for future growth.”
While analysts generally claimed no great surprises in Sands China’ results, they did point to mass market revenue as proving stronger than expected.
“GGR was US$1.8 billion, benefiting slightly from high VIP hold while marginally negatively impacted by lighter than normal mass hold (but still within theoretical range),” said Sanford C Bernstein’s Vitaly Umansky, Zhen Gong and Yang Xie.
“VIP GGR was lighter than we had anticipated with growth lower than our market estimate quarter-on-quarter (-2% vs. +8% estimate for the market). Mass GGR, however was better than expected, with growth better than the market quarter-on-quarter (+5% vs. +2% est. for the market) on robust Premium Mass growth (+ 30% quarter-on-quarter).”
Marina Bay Sands in Singapore saw adjusted property EBITDA increase 32.7% to US$365 million, while Las Vegas Sands reported overall consolidated net revenue of US$3.11 billion – a rise of 14.3%
