Las Vegas Sands Profit Beats View on Cost Cuts, Singaporeby
Company boosts quarterly dividend by 11 percent to 72 cents
Revenue at Sands China drops 29 percent with Macau slump
Las Vegas Sands Corp., the world’s largest casino operator, reported third-quarter profit that beat expectations as the company, battling challenges in Macau, controlled costs and relied on its Singapore operation for an earnings boost.
Profit, excluding some items, was 66 cents a share, according to a statement Wednesday. Analysts had forecast 63 cents, the average of 16 estimates compiled by Bloomberg. Sales fell 18 percent to $2.89 billion, versus an average estimate of $2.96 billion. Sands raised its quarterly dividend by 11 percent to 72 cents a share.
Sands, like the other five casino owners in Macau, has been pummeled by a sharp drop in betting in what has become the world’s largest gambling market. A government crackdown on corruption led by President Xi Jinping, as well as a slowing economy, has prompted high-rollers to avoid the only place in China where casino gambling is legal.
Revenue at the company’s Sands China Ltd. unit fell 29 percent to $1.66 billion, while earnings before interest, taxes, depreciation and amortization declined 33 percent $545 million.
Sales rose 2.1 percent in Singapore to $750.7 million, and grew 1.3 percent to $386.9 million in Las Vegas, the company said.
Las Vegas Sands rose 3 percent to $48.24 in extended trading. The shares fell 1 percent to $46.84 at the close in New York, and h ave fallen 19 percent this year.
Regulators in Macau have pushed the casino companies to offer broader entertainment experiences with new projects such as Sands China’s Parisian Macao. That’s led to some friction, as operators including Steve Wynn have criticized the government for delays in giving out allotments of table games, a major source of income from the multi-billion dollar investments.
On a conference call with investors, Sands executives said the $2.7 billion Parisian casino would open in 2016, at the end of the third quarter or beginning of the fourth quarter.
“We have a lot of confidence in Singapore and Las Vegas and Bethlehem’s performance next year to levels hopefully exceeding this year’s levels,” said Robert Goldstein, Sands’ president, citing properties outside of China including Bethlehem, Pennsylvania. “The big question mark obviously remains Macau. No one is confused about that. And it’s virtually impossible for us to tell you what we -- how to think about Macau.”