Las Vegas Sands says Vegas ops had best quarter in nine years

TAGs: Japan, Las Vegas, Las Vegas Sands, Macau, sheldon adelson

las-vegas-sands-best-quarterCasino operator Las Vegas Sands reported revenue of over $3.1b in Q1 2017 while profit soared to nearly half a billion, which, when you really think about it, ain’t too bad for three months’ work.

Figures released Wednesday show Sands generated revenue of $3.11b in the three months ending March 31, up 14.3% from the same period last year. Adjusted earnings were up 25% – up 9.5% on a hold-normalized basis – to $1.14b. Under less forgiving US accounting standards, operating income rose 30% to $763m and net income rose 50% to $480m.

Sands China’s revenue improved 15.3% to $1.88b, while net income gained 12% to $349m thanks mainly to last September’s launch of the Parisian Macao resort. The Parisian reported revenue of $318m, down from $344m in Q4 2016, but this was mainly due to VIP win rate falling back to earth from the absurdly high 4.52% in Q4.

However, the Parisian’s room occupancy fell nine points to 82%, and this was well before word leaked of the property’s recent outbreak of Legionnaires’ Disease. Fortunately, all four of Sands China’s other properties stepped up to the plate by reporting solid year-on-year occupancy gains.

The same can’t be said for VIP play at these other properties, which was down double-digits across the board, including a 25.2% decline at the flagship Venetian Macao and 19.5% at Sands Cotai Central. Mass market table drop was also mostly negative, albeit by much smaller margins.

In Singapore, Marina Bay Sands roared back to life, posting a 16% revenue rise to $700m thanks primarily to a recovery from Q1 2016’s abysmally low VIP win rate of 1.42%. VIP turnover was down 7.4% but win was back up to 2.52%, proving that the gambling gods can both give and take.

The retail mall business at Sands’ Asian properties would be an enviably successful company all on its own, and it had another solid quarter, with revenue up 16.4% to $156m.

In Las Vegas, record business for conventions and group meetings – along with some good old fashioned “cost discipline” – resulted in the best Vegas performance since the pre-recession days of Q1 2008. Overall revenue rose 12.7% to $434m thanks to gaming revenue rising 18.3% despite softer baccarat play in the post-Lunar New Year period.

In Pennsylvania, the (soon to be sold?) Sands Bethlehem reported a modest revenue gain to $142m as rising slots handle offset decreased table drop.

Speaking on the analyst call, Sands supremo Sheldon Adelson (pictured) once again claimed to have the inside track on winning a coveted Japanese casino license. Adelson claimed Sands was “by far, not just marginally, but by far ahead of the other competition” and Japan’s government “may allow us to have an interest in more than one integrated resort. And of course, we would like that.”

Adelson made similar claims last November about Osaka’s government thinking Sands was “the best company.” Adelson worried at the time that this might complicate Sands’ desire to build in Tokyo, but Adelson said on Wednesday that “we’ve been told we’re in the pole position in more than one location.” Adelson’s rivals have previously rubbished his claims as mere bluster.


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