Las Vegas Sands Results

Las Vegas Sands Reports Third Quarter 2017 Results

Las Vegas Sands

For the Quarter Ended September 30, 2017 

(Compared to the Quarter Ended September 30, 2016)

- Consolidated Net Revenue Increased 7.7% to $3.20 Billion

- Net Income Increased 13.0% to $685 Million

- GAAP Earnings per Diluted Share Increased 10.8% to $0.72; Adjusted Earnings per Diluted Share Increased 8.5% to $0.77

- Consolidated Adjusted Property EBITDA Increased 6.0% to $1.21 Billion, While Hold-Normalized Adjusted Property EBITDA Increased 10.4% to $1.18 Billion

- In Macao, Adjusted Property EBITDA Increased 3.8% to $652 Million, While Hold-Normalized Adjusted Property EBITDA Increased 11.1% to $642 Million

- At Marina Bay Sands in Singapore, Adjusted Property EBITDA Increased 13.0% to $442 Million, While Hold-Normalized Adjusted Property EBITDA Increased 11.4% to $410 Million

- At Our Las Vegas Operating Properties, Adjusted Property EBITDA Decreased 11.6% to $76 Million, While Hold-Normalized Adjusted Property EBITDA Increased 2.3% to $90 Million

- The Company Paid Quarterly Dividends of $0.73 per Share During the Quarter

- The Company Repurchased $75 Million of Common Stock During the Quarter

- The Company's Board of Directors Announced an $0.08 Increase in the Company's Recurring Common Stock Dividend for the 2018 Calendar Year, its Sixth Consecutive Annual Increase, Raising the Annual Dividend to $3.00($0.75 per Share per Quarter) 

Las Vegas Sands Corp. (NYSE: LVS) today reported financial results for the quarter ended September 30, 2017.

Third Quarter Overview

Mr. Sheldon G. Adelson, chairman and chief executive officer, said, "We are pleased to have delivered strong financial results again this quarter, led by growth in both Macao and Singapore. Our convention-based Integrated Resort business model remains the key driver of our financial results, with consolidated adjusted property EBITDA reaching $1.21 billion, while hold-normalized adjusted property EBITDA increased 10.4%. We also continued to return excess capital to shareholders through dividends and share repurchases during the quarter.

"In Macao, the market continues to recover, while Sands China's Mass and VIP gaming volumes both outpaced the growth in the Macao market overall. That strong gaming performance, coupled with higher hotel occupancy and retail mall revenues, helped drive an adjusted property EBITDA performance of $652 million, our best quarterly result since the first quarter of 2014.

"Strong visitation at The Parisian Macao continued to contribute to impressive growth in all segments, with the property delivering adjusted property EBITDA of $135 million for the quarter, up 27.4% compared to the second quarter of 2017. Now clearly established as a 'must-see' destination for visitors to the Cotai Strip, The Parisian delivered sequential growth in visitation, hotel occupancy, ADR and gaming volumes, while mass win per day of $2.58 million was the highest result since the property's opening last year. We expect The Parisian to deliver continued growth in the years ahead as we further align the property's suite of offerings to appeal to every segment of the evolving Macao market.

"While we have invested over $13 billion in Macao since 2002, consistently contributing to Macao's diversification and appeal as a business and leisure tourism destination, we see tremendous future opportunity in the Macao market as it continues to grow and evolve. We are therefore extremely excited to announce that we will invest over $1.1 billion in new capital projects over the next three years in Macao, at Sands Cotai Central and the Four Seasons Hotel Macao. The bulk of that investment will accomplish the expansion, renovation and rebranding of Sands Cotai Central into a new destination integrated resort, The Londoner Macao.  The Londoner Macao will feature dynamic new attractions and features from London including some of London's most recognizable landmarks, an expanded and reimagined retail mall and 350 luxurious new suites, the St Regis Tower Suites. We will also be expanding the Four Seasons Hotel Macao by opening an additional 295 new suites in a separate tower, The Four Seasons Hotel Tower Suites.

"As we continue to make market-leading investments in our Integrated Resort offerings in Macao, we will also continue to lead in the marketing of Macao throughout China and the region as Asia's leading business and leisure tourism destination. We remain confident that our Cotai Strip property portfolio will continue to deliver important benefits to Macao in the form of economic diversification, greater numbers of business and leisure travelers, and a superior platform for growth in the years ahead.

"Marina Bay Sands again delivered outstanding financial results during the quarter with adjusted property EBITDA expanding 13% to reach $442 million. Marina Bay Sands' innovative programming, mass gaming play and non-gaming revenues underpin the continued success of this industry-leading property, while stronger VIP volumes and continued cost discipline also contributed to the strong performance. EBITDA margin increased 440 basis points in the quarter, reaching 55.7%. We are pleased to have established Marina Bay Sands as a reference site for other cities and countries that are considering harnessing the economic power and direct contributions to tourism, employment and GDP growth that are gained through our unique convention-based Integrated Resort business model.

"The strength of our business model enables us to increase the return of capital to shareholders while maintaining a strong balance sheet and ample liquidity to invest in future growth opportunities. The company's recurring quarterly dividend remains the cornerstone of our program to return excess capital to shareholders. Accordingly, I am extremely pleased to announce that the company's Board of Directors has increased the company's recurring common stock dividend for the 2018 calendar year to $3.00 per share, or $0.75 per quarter. After establishing our recurring quarterly dividend in 2012, this increase represents our sixth consecutive annual increase in our recurring quarterly dividend."

The company paid a recurring quarterly dividend of $0.73 per common share during the quarter. The company announced that its next quarterly dividend of $0.73 per common share will be paid on December 29, 2017, to Las Vegas Sands shareholders of record on December 21, 2017. In addition, the company repurchased $75 million of common stock (1.2 million shares at a weighted average price of $63.90) during the quarter ended September 30, 2017.

Company-Wide Operating Results

Net revenue for the third quarter of 2017 increased 7.7% to $3.20 billion, compared to $2.97 billion in the third quarter of 2016. Net income increased 13.0% to $685 million in the third quarter of 2017, compared to $606 million in the year-ago quarter.

On a GAAP (accounting principles generally accepted in the United States of America) basis, operating income in the third quarter of 2017 increased 18.9% to $856 million, compared to $720 million in the third quarter of 2016. The increase in operating income was primarily due to a full quarter of operations for The Parisian Macao, stronger results at Marina Bay Sands in Singapore and the impact of a change in our depreciation lives discussed further below. Consolidated adjusted property EBITDA (a non-GAAP measure) of $1.21 billion increased 6.0% in the third quarter of 2017, compared to the year-ago quarter. On a hold-normalized basis, adjusted property EBITDA was $1.18 billion in the third quarter of 2017, an increase of 10.4% from the prior-year quarter.

On a GAAP basis, net income attributable to Las Vegas Sands in the third quarter of 2017 increased 11.1% to $570 million, compared to $513 million in the third quarter of 2016, while diluted earnings per share in the third quarter of 2017 of $0.72 represented an increase of 10.8% compared to the prior-year quarter. The increase in net income attributable to Las Vegas Sands reflected the increase in operating income described above, partially offset by increases in other expense and net income attributable to noncontrolling interests.

Adjusted net income attributable to Las Vegas Sands (a non-GAAP measure) increased 8.0% to $607 million, or $0.77per diluted share, compared to $562 million, or $0.71 per diluted share, in the third quarter of 2016.

Sands China Ltd. Consolidated Financial Results

On a GAAP basis, total net revenues for Sands China Ltd. (SCL) increased 12.2% to $1.93 billion in the third quarter of 2017, compared to $1.72 billion in the third quarter of 2016. Net income for SCL increased 24.4% to $403 million in the third quarter of 2017, compared to $324 million in the third quarter of 2016.

The Venetian Macao Third Quarter Operating Results

The Venetian Macao generated revenue of $718 million and adjusted property EBITDA of $263 million in the third quarter, with an adjusted property EBITDA margin of 36.6%. In the third quarter of 2017, there were approximately 8% fewer rooms available compared to the same quarter of the prior year. Non-Rolling Chip drop increased 10.4% for the quarter, reaching $1.89 billion. Non-Rolling Chip win percentage was 22.8%, compared to 25.6% in the third quarter of 2016. Rolling Chip volume was $6.90 billion, with a Rolling Chip win percentage of 3.28%, within the expected range and below the 3.75% experienced in the prior-year quarter. Slot handle was $718 million for the quarter.

The following table summarizes the key operating results for The Venetian Macao for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

The Venetian Macao Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

617

$

670

$

(53)

(7.9)

%

Rooms

45

47

(2)

(4.3)

%

Food and Beverage

22

22

%

Mall

55

52

3

5.8

%

Convention, Retail and Other

17

23

(6)

(26.1)

%

Less - Promotional Allowances

(38)

(41)

3

(7.3)

%

Net Revenues

$

718

$

773

$

(55)

(7.1)

%

Adjusted Property EBITDA

$

263

$

315

$

(52)

(16.5)

%

EBITDA Margin %

36.6

%

40.8

%

(4.2)

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

6,898

$

6,868

$

30

0.4

%

Rolling Chip Win %(1)

3.28

%

3.75

%

(0.47)

pts

Non-Rolling Chip Drop

$

1,892

$

1,714

$

178

10.4

%

Non-Rolling Chip Win %

22.8

%

25.6

%

(2.8)

pts

Slot Handle

$

718

$

958

$

(240)

(25.1)

%

Slot Hold %

5.1

%

4.7

%

0.4

pts

Hotel Statistics

Occupancy %

90.7

%

93.2

%

(2.5)

pts

Average Daily Rate (ADR)

$

224

$

209

$

15

7.2

%

Revenue per Available Room (RevPAR)

$

203

$

195

$

8

4.1

%

 

(1)

This compares to our expected Rolling Chip win percentage of 3.0% to 3.3% (calculated before discounts and commissions). We revised the expected range due to the Rolling Chip win percentage experienced over the last several years.

Sands Cotai Central Third Quarter Operating Results

Revenue and adjusted property EBITDA for the third quarter of 2017 at Sands Cotai Central were $474 million and $155 million, respectively, resulting in an adjusted property EBITDA margin of 32.7%.

Non-Rolling Chip drop was $1.44 billion in the third quarter, with a Non-Rolling Chip win percentage of 20.4%. Rolling Chip volume was $2.85 billion for the quarter, with a Rolling Chip win percentage of 2.66%, below the expected range and the 4.16% in the third quarter of 2016. Slot handle was $1.18 billion for the quarter.

The following table summarizes our key operating results for Sands Cotai Central for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

Sands Cotai Central Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

390

$

443

$

(53)

(12.0)

%

Rooms

79

73

6

8.2

%

Food and Beverage

27

26

1

3.8

%

Mall

15

15

%

Convention, Retail and Other

6

6

%

Less - Promotional Allowances

(43)

(45)

2

(4.4)

%

Net Revenues

$

474

$

518

$

(44)

(8.5)

%

Adjusted Property EBITDA

$

155

$

176

$

(21)

(11.9)

%

EBITDA Margin %

32.7

%

34.0

%

(1.3)

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

2,846

$

2,817

$

29

1.0

%

Rolling Chip Win %(1)

2.66

%

4.16

%

(1.50)

pts

Non-Rolling Chip Drop

$

1,442

$

1,557

$

(115)

(7.4)

%

Non-Rolling Chip Win %

20.4

%

20.2

%

0.2

pts

Slot Handle

$

1,182

$

1,477

$

(295)

(20.0)

%

Slot Hold %

4.4

%

3.6

%

0.8

pts

Hotel Statistics

Occupancy %

93.0

%

89.2

%

3.8

pts

Average Daily Rate (ADR)

$

148

$

145

$

3

2.1

%

Revenue per Available Room (RevPAR)

$

138

$

129

$

9

7.0

%

 

(1)

This compares to our expected Rolling Chip win percentage of 3.0% to 3.3% (calculated before discounts and commissions). We revised the expected range due to the Rolling Chip win percentage experienced over the last several years.

The Parisian Macao Third Quarter Operating Results

The Parisian Macao opened on September 13, 2016. Revenue and adjusted property EBITDA at The Parisian Macao were $418 million and $135 million, respectively, resulting in an adjusted property EBITDA margin of 32.3%.

Non-Rolling Chip drop was $1.0 billion, with a Non-Rolling Chip win percentage of 20.9%. Rolling Chip volume was $6.95 billion, with a Rolling Chip win percentage of 3.11%, within the expected range and below the second quarter 2017 win percentage of 3.89%. Slot handle was $927 million for the quarter.

The following table summarizes our key operating results for The Parisian Macao in the third quarter of 2017 compared to the second quarter of 2017:

 

Three Months Ended

The Parisian Macao Operations

September 30,

June 30,

(Dollars in millions)

2017(1)

2017

$ Change

Change

Revenues:

Casino

$

379

$

322

$

57

17.7

%

Rooms

35

32

3

9.4

%

Food and Beverage

15

16

(1)

(6.3)

%

Mall

16

17

(1)

(5.9)

%

Convention, Retail and Other

5

5

%

Less - Promotional Allowances

(32)

(31)

(1)

3.2

%

Net Revenues

$

418

$

361

$

57

15.8

%

Adjusted Property EBITDA

$

135

$

106

$

29

27.4

%

EBITDA Margin %

32.3

%

29.4

%

2.9

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

6,948

$

3,760

$

3,188

84.8

%

Rolling Chip Win %(2)

3.11

%

3.89

%

(0.78)

 pts

Non-Rolling Chip Drop

$

1,001

$

973

$

28

2.9

%

Non-Rolling Chip Win %

20.9

%

19.7

%

1.2

pts

Slot Handle

$

927

$

935

$

(8)

(0.9)

%

Slot Hold %

3.1

%

3.3

%

(0.2)

pts

Hotel Statistics

Occupancy %

94.1

%

88.0

%

6.1

pts

Average Daily Rate (ADR)

$

144

$

138

$

6

4.3

%

Revenue per Available Room (RevPAR)

$

136

$

122

$

14

11.5

%

 

(1)

The Parisian Macao opened in September 2016.

(2)

This compares to our expected Rolling Chip win percentage of 3.0% to 3.3% (calculated before discounts and commissions). We revised the expected range due to the Rolling Chip win percentage experienced over the last several years.

The Plaza Macao and Four Seasons Hotel Macao Third Quarter Operating Results

The Plaza Macao and Four Seasons Hotel Macao generated revenue of $147 million and adjusted property EBITDA of $52 million, resulting in an adjusted property EBITDA margin of 35.4% in the third quarter of 2017. In the third quarter of 2017, there were approximately 6% fewer rooms available compared to the same quarter of the prior year. Non-Rolling Chip drop increased 10.0% compared to the same quarter last year, reaching $297 million, with a Non-Rolling Chip win percentage of 23.1%. Rolling Chip volume increased 56.1% to reach $3.13 billion for the quarter. Rolling Chip win percentage of 2.23% in the third quarter of 2017 was below the expected range and below the win percentage of 3.67% in the prior year. Slot handle increased 3.5% to $117 million during the quarter.

The following table summarizes our key operating results for The Plaza Macao and Four Seasons Hotel Macao for the third quarter of 2017 compared to the third quarter of 2016:

 

The Plaza Macao and Four Seasons Hotel Macao Operations

Three Months Ended

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

109

$

124

$

(15)

(12.1)

%

Rooms

9

9

%

Food and Beverage

7

6

1

16.7

%

Mall

31

32

(1)

(3.1)

%

Convention, Retail and Other

1

1

%

Less - Promotional Allowances

(10)

(11)

1

(9.1)

%

Net Revenues

$

147

$

161

$

(14)

(8.7)

%

Adjusted Property EBITDA

$

52

$

62

$

(10)

(16.1)

%

EBITDA Margin %

35.4

%

38.5

%

(3.1)

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

3,132

$

2,007

$

1,125

56.1

%

Rolling Chip Win %(1)

2.23

%

3.67

%

(1.44)

 pts

Non-Rolling Chip Drop

$

297

$

270

$

27

10.0

%

Non-Rolling Chip Win %

23.1

%

23.8

%

(0.7)

pts

Slot Handle

$

117

$

113

$

4

3.5

%

Slot Hold %

6.6

%

5.5

%

1.1

pts

Hotel Statistics

Occupancy %

80.8

%

80.8

%

pts

Average Daily Rate (ADR)

$

335

$

345

$

(10)

(2.9)

%

Revenue per Available Room (RevPAR)

$

271

$

279

$

(8)

(2.9)

%

 

(1)

This compares to our expected Rolling Chip win percentage of 3.0% to 3.3% (calculated before discounts and commissions). We revised the expected range due to the Rolling Chip win percentage experienced over the last several years.

Sands Macao Third Quarter Operating Results

Sands Macao generated revenue of $143 million and adjusted property EBITDA of $41 million in the third quarter, with an adjusted property EBITDA margin of 28.7%. Non-Rolling Chip drop was $603 million during the quarter, while slot handle was $602 million. Rolling Chip volume was $680 million for the quarter. The property realized 1.13% win on Rolling Chip volume during the quarter, below the expected range and the 2.03% experienced in the year-ago quarter.

The following table summarizes our key operating results for Sands Macao for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

Sands Macao Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

138

$

162

$

(24)

(14.8)

%

Rooms

5

5

%

Food and Beverage

6

7

(1)

(14.3)

%

Convention, Retail and Other

1

2

(1)

(50.0)

%

Less - Promotional Allowances

(7)

(9)

2

(22.2)

%

Net Revenues

$

143

$

167

$

(24)

(14.4)

%

Adjusted Property EBITDA

$

41

$

46

$

(5)

(10.9)

%

EBITDA Margin %

28.7

%

27.5

%

1.2

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

680

$

1,416

$

(736)

(52.0)

%

Rolling Chip Win %(1)

1.13

%

2.03

%

(0.90)

pts

Non-Rolling Chip Drop

$

603

$

671

$

(68)

(10.1)

%

Non-Rolling Chip Win %

18.7

%

19.3

%

(0.6)

pts

Slot Handle

$

602

$

665

$

(63)

(9.5)

%

Slot Hold %

3.4

%

3.3

%

0.1

pts

Hotel Statistics

Occupancy %

95.7

%

97.9

%

(2.2)

pts

Average Daily Rate (ADR)

$

191

$

190

$

1

0.5

%

Revenue per Available Room (RevPAR)

$

183

$

186

$

(3)

(1.6)

%

 

(1)

This compares to our expected Rolling Chip win percentage of 3.0% to 3.3% (calculated before discounts and commissions). We revised the expected range due to the Rolling Chip win percentage experienced over the last several years.

Marina Bay Sands Third Quarter Operating Results

Marina Bay Sands' revenue increased 4.1% to $793 million and adjusted property EBITDA increased 13.0% to $442 million. In the third quarter of 2017, there were approximately 7% fewer rooms available compared to the same quarter of the prior year.

Rolling Chip win percentage of 3.29% in the third quarter of 2017 was above the 3.25% achieved in the third quarter of 2016 and above the expected range. Rolling Chip volume increased 30.1% compared to the third quarter of 2016, reaching $9.44 billion for the quarter.

Non-Rolling Chip drop was $943 million during the quarter, with a Non-Rolling Chip win percentage of 28.4%. Slot handle increased 5.8% to $3.66 billion for the quarter compared to the year-ago quarter. 

The following table summarizes our key operating results for Marina Bay Sands for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

Marina Bay Sands Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

629

$

592

$

37

6.3

%

Rooms

93

109

(16)

(14.7)

%

Food and Beverage

48

54

(6)

(11.1)

%

Mall

42

42

%

Convention, Retail and Other

25

27

(2)

(7.4)

%

Less - Promotional Allowances

(44)

(62)

18

(29.0)

%

Net Revenues

$

793

$

762

$

31

4.1

%

Adjusted Property EBITDA

$

442

$

391

$

51

13.0

%

EBITDA Margin %

55.7

%

51.3

%

4.4

pts

Gaming Statistics

(Dollars in millions)

Rolling Chip Volume

$

9,443

$

7,258

$

2,185

30.1

%

Rolling Chip Win %(1)

3.29

%

3.25

%

0.04

pts

Non-Rolling Chip Drop

$

943

$

985

$

(42)

(4.3)

%

Non-Rolling Chip Win %

28.4

%

28.8

%

(0.4)

pts

Slot Handle

$

3,658

$

3,457

$

201

5.8

%

Slot Hold %

4.2

%

4.5

%

(0.3)

pts

Hotel Statistics

Occupancy %

96.6

%

98.3

%

(1.7)

pts

Average Daily Rate (ADR)

$

445

$

475

$

(30)

(6.3)

%

Revenue per Available Room (RevPAR)

$

430

$

467

$

(37)

(7.9)

%

 

(1)

This compares to our expected Rolling Chip win percentage of 2.7% to 3.0% (calculated before discounts and commissions).

Las Vegas Operations Third Quarter Operating Results

Revenue at The Venetian Las Vegas and The Palazzo, including the Sands Expo and Convention Center, decreased 1.6% to $378 million, while adjusted property EBITDA decreased 11.6% to $76 million. EBITDA margin decreased 230 basis points to 20.1%. In the third quarter of 2017, there were approximately 3% fewer rooms available compared to the same quarter of the prior year.

RevPAR decreased 3.0% year-over-year to $225 in the quarter, reflecting a 3.3% decrease in ADR to $232, offset by a 0.5 percentage point increase in occupancy to 97.0%. Table games drop decreased 7.0% in the quarter to $401 million, with a win percentage of 17.1%, compared to a win percentage of 20.0% in the same quarter last year. Slot handle increased 3.8% to $658 million.

The following table summarizes our key operating results for our Las Vegas operations for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

Las Vegas Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

111

$

122

$

(11)

(9.0)

%

Rooms

141

149

(8)

(5.4)

%

Food and Beverage

66

58

8

13.8

%

Convention, Retail and Other

84

82

2

2.4

%

Less - Promotional Allowances

(24)

(27)

3

(11.1)

%

Net Revenues

$

378

$

384

$

(6)

(1.6)

%

Adjusted Property EBITDA

$

76

$

86

$

(10)

(11.6)

%

EBITDA Margin %

20.1

%

22.4

%

(2.3)

 pts

Gaming Statistics

(Dollars in millions)

Table Games Drop

$

401

$

431

$

(30)

(7.0)

%

Table Games Win %(1)

17.1

%

20.0

%

(2.9)

 pts

Slot Handle

$

658

$

634

$

24

3.8

%

Slot Hold %

8.1

%

8.2

%

(0.1)

 pts

Hotel Statistics

Occupancy %

97.0

%

96.5

%

0.5

pts

Average Daily Rate (ADR)

$

232

$

240

$

(8)

(3.3)

%

Revenue per Available Room (RevPAR)

$

225

$

232

$

(7)

(3.0)

%

 

(1)

This compares to our expected Baccarat win percentage of 18.0% to 26.0% and our expected non-Baccarat win percentage of 16.0% to 24.0% (calculated before discounts). We revised the expected ranges due to the respective win percentages experienced over the last several years.

Sands Bethlehem Third Quarter Operating Results

Revenue at Sands Bethlehem was $148 million, while adjusted property EBITDA was an all-time record of $40 million for the quarter. Table games drop increased 3.2% to $293 million for the quarter, while table games win percentage was 20.1%, above the 19.6% realized in the third quarter of 2016. Slot handle increased 3.5% year-over-year to $1.21 billion for the quarter, with a slot hold percentage of 6.5%.

The following table summarizes our key operating results for Sands Bethlehem for the third quarter of 2017 compared to the third quarter of 2016:

 

Three Months Ended

Sands Bethlehem Operations

September 30,

(Dollars in millions)

2017

2016

$ Change

Change

Revenues:

Casino

$

138

$

136

$

2

1.5

%

Rooms

4

4

%

Food and Beverage

7

7

%

Mall

1

1

%

Convention, Retail and Other

5

5

%

Less - Promotional Allowances

(7)

(6)

(1)

16.7

%

Net Revenues

$

148

$

147

$

1

0.7

%

Adjusted Property EBITDA

$

40

$

37

$

3

8.1

%

EBITDA Margin %

27.0

%

25.2

%

1.8

pts

Gaming Statistics

(Dollars in millions)

Table Games Drop

$

293

$

284

$

9

3.2

%

Table Games Win %(1)

20.1

%

19.6

%

0.5

pts

Slot Handle

$

1,210

$

1,169

$

41

3.5

%

Slot Hold %

6.5

%

6.7

%

(0.2)

 pts

Hotel Statistics

Occupancy %

96.1

%

97.2

%

(1.1)

 pts

Average Daily Rate (ADR)

$

164

$

164

$

%

Revenue per Available Room (RevPAR)

$

158

$

160

$

(2)

(1.3)

%

Asian Retail Mall Operations

Gross revenue from tenants in the company's retail malls on Macao's Cotai Strip (The Venetian Macao, The Plaza Macao and Four Seasons Hotel Macao, Sands Cotai Central and The Parisian Macao) and Marina Bay Sands in Singaporeincreased 8.9% to $159 million for the third quarter of 2017, compared to the third quarter of 2016. Operating profit derived from these retail mall assets increased 8.5% year-over-year to $141 million.

 

For The Three Months Ended September 30, 2017

TTM 

September 30, 

2017

(Dollars in millions except per square foot data)

Gross 

Revenue(1)

Operating 

Profit

Operating 

Profit 

Margin

Gross 

Leasable Area 

(sq. ft.)

Occupancy

% at

End of 

Period

Tenant Sales 

Per Sq. Ft.(2)

Shoppes at Venetian

$

55

$

49

89.1

%

785,973

97.3

%

$

1,357

Shoppes at Four Seasons

Luxury Retail

21

20

95.2

%

142,562

100.0

%

4,538

Other Stores

10

9

90.0

%

115,830

100.0

%

1,533

Total

31

29

93.5

%

258,392

100.0

%

3,247

Shoppes at Cotai Central(3)

15

13

86.7

%

425,581

93.0

%

711

Shoppes at Parisian(4)

16

13

81.3

%

299,125

92.5

%

531

Total Cotai Strip in Macao

117

104

88.9

%

1,769,071

95.9

%

1,366

The Shoppes at Marina Bay Sands

42

37

88.1

%

606,946

97.2

%

1,506

Total

$

159

$

141

88.7

%

2,376,017

96.2

%

$

1,401

 

(1)

Gross revenue figures are net of intersegment revenue eliminations.

(2)

Tenant sales per square foot reflect sales from tenants only after the tenant has been open for a period of 12 months.

(3)

The Shoppes at Cotai Central will feature up to an estimated 600,000 square feet of gross leasable area at completion of all phases of Sands Cotai Central's renovation, rebranding and expansion to The Londoner Macao.

(4)

The Shoppes at Parisian opened in September 2016.

Other Factors Affecting Earnings

Depreciation and amortization expense was $265 million in the third quarter of 2017, compared to $277 million in the third quarter of 2016. This decrease was driven primarily by a change in the estimated useful lives of our buildings, building improvements and land improvements from a range of 15 to 40 years to 10 to 50 years from the date placed in service, as well as changes to the estimated useful lives of certain other furniture, fixtures and equipment, to better reflect the estimated periods during which these assets are expected to remain in service. The change in estimated useful lives was accounted for as a change in accounting estimate beginning on July 1, 2017, and resulted in a reduction of depreciation and amortization expense and an increase in operating income of $51 million, and an increase of net income of $46 million, or earnings per share of $0.06 on a basic and diluted basis, in the third quarter of 2017.

Interest expense, net of amounts capitalized, was $83 million for the third quarter of 2017, compared to $65 million in the prior-year quarter. Capitalized interest was $1 million during the third quarter of 2017, compared to $11 millionduring the third quarter of 2016. The decrease in capitalized interest was a result of the opening of The Parisian Macao in September 2016. Our weighted average borrowing cost in the third quarter of 2017 was approximately 3.2%, compared to 2.9% during the third quarter of 2016.

Other expense, which was comprised primarily of foreign currency losses due to a depreciation of the U.S. dollar versus the Singapore dollar during the period, was $19 million for the third quarter of 2017, compared to other income of $21 million in the third quarter of 2016. 

The company's effective income tax rate for the third quarter of 2017 was 9.6% compared to 10.2% in the prior-year quarter. The tax rate is primarily driven by a provision for the earnings from Marina Bay Sands at the 17% Singaporeincome tax rate.

The net income attributable to noncontrolling interests during the third quarter of 2017 of $115 million was principally related to SCL.

Balance Sheet Items

Unrestricted cash balances as of September 30, 2017 were $2.00 billion.

As of September 30, 2017, total debt outstanding, including the current portion and net of deferred financing costs (excluding those costs related to our revolving facilities) and original issue discount, was $9.62 billion.

Capital Expenditures

Capital expenditures during the third quarter totaled $212 million, including construction, development and maintenance activities of $124 million in Macao, $45 million at Marina Bay Sands, $37 million in Las Vegas and $6 millionat Sands Bethlehem. 

Exhibit 1

Las Vegas Sands Corp. and Subsidiaries

Condensed Consolidated Statements of Operations

(In millions, except per share data)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Revenues:

  Casino

$

2,511

$

2,307

$

7,379

$

6,406

  Rooms

411

402

1,194

1,123

  Food and beverage

198

184

610

559

  Mall

160

147

476

422

  Convention, retail and other

128

141

400

389

3,408

3,181

10,059

8,899

  Less - promotional allowances

(209)

(212)

(613)

(564)

3,199

2,969

9,446

8,335

Operating expenses:

  Resort operations

1,993

1,829

5,892

5,332

  Corporate

51

39

136

208

  Pre-opening

1

86

7

128

  Development

3

3

8

7

  Depreciation and amortization

265

277

913

792

  Amortization of leasehold interests in land

9

10

28

29

  Loss on disposal or impairment of assets

21

5

27

15

2,343

2,249

7,011

6,511

Operating income

856

720

2,435

1,824

Other income (expense):

  Interest income

4

2

11

6

  Interest expense, net of amounts capitalized

(83)

(65)

(240)

(198)

  Other income (expense)

(19)

21

(80)

(33)

  Loss on modification or early retirement of debt

(3)

(5)

(3)

Income before income taxes

758

675

2,121

1,596

Income tax expense

(73)

(69)

(220)

(187)

Net income

685

606

1,901

1,409

Net income attributable to noncontrolling interests

(115)

(93)

(306)

(248)

Net income attributable to Las Vegas Sands Corp.

$

570

$

513

$

1,595

$

1,161

Earnings per share:

  Basic

$

0.72

$

0.65

$

2.01

$

1.46

  Diluted

$

0.72

$

0.65

$

2.01

$

1.46

Weighted average shares outstanding:

  Basic

791

795

792

795

  Diluted

792

795

793

795

Dividends declared per common share

$

0.73

$

0.72

$

2.19

$

2.16

 

Exhibit 2

Las Vegas Sands Corp. and Subsidiaries

Net Revenues and Adjusted Property EBITDA

(In millions)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Net Revenues

The Venetian Macao

$

718

$

773

$

2,146

$

2,188

Sands Cotai Central

474

518

1,386

1,521

The Parisian Macao

418

69

1,097

69

The Plaza Macao and Four Seasons Hotel Macao

147

161

427

434

Sands Macao

143

167

486

527

Ferry Operations and Other

44

46

130

126

  Macao Operations

1,944

1,734

5,672

4,865

Marina Bay Sands

793

762

2,329

2,076

Las Vegas Operating Properties

378

384

1,196

1,125

Sands Bethlehem

148

147

437

432

Intersegment Eliminations

(64)

(58)

(188)

(163)

$

3,199

$

2,969

$

9,446

$

8,335

Adjusted Property EBITDA

The Venetian Macao

$

263

$

315

$

808

$

827

Sands Cotai Central

155

176

431

484

The Parisian Macao

135

19

323

19

The Plaza Macao and Four Seasons Hotel Macao

52

62

162

154

Sands Macao

41

46

134

125

Ferry Operations and Other

6

10

18

25

  Macao Operations

652

628

1,876

1,634

Marina Bay Sands

442

391

1,299

1,023

Las Vegas Operating Properties

76

86

277

245

Sands Bethlehem

40

37

113

113

$

1,210

$

1,142

$

3,565

$

3,015

Adjusted Property EBITDA as a Percentage of Net Revenues

The Venetian Macao

36.6

%

40.8

%

37.7

%

37.8

%

Sands Cotai Central

32.7

%

34.0

%

31.1

%

31.8

%

The Parisian Macao

32.3

%

27.5

%

29.4

%

27.5

%

The Plaza Macao and Four Seasons Hotel Macao

35.4

%

38.5

%

37.9

%

35.5

%

Sands Macao

28.7

%

27.5

%

27.6

%

23.7

%

Ferry Operations and Other

13.6

%

21.7

%

13.8

%

19.8

%

  Macao Operations

33.5

%

36.2

%

33.1

%

33.6

%

Marina Bay Sands

55.7

%

51.3

%

55.8

%

49.3

%

Las Vegas Operating Properties

20.1

%

22.4

%

23.2

%

21.8

%

Sands Bethlehem

27.0

%

25.2

%

25.9

%

26.2

%

Total

37.8

%

38.5

%

37.7

%

36.2

%

 

Exhibit 3

Las Vegas Sands Corp. and Subsidiaries

Supplemental Data

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Casino Statistics:

The Venetian Macao:

Table games win per unit per day (1)

$

12,648

$

11,930

$

12,845

$

11,382

Slot machine win per unit per day (2)

$

239

$

268

$

243

$

263

Average number of table games

565

635

560

643

Average number of slot machines

1,675

1,819

1,623

1,900

Sands Cotai Central:

Table games win per unit per day (1)

$

10,264

$

9,784

$

10,286

$

9,212

Slot machine win per unit per day (2)

$

314

$

331

$

307

$

321

Average number of table games

392

480

398

504

Average number of slot machines

1,798

1,752

1,726

1,850

The Parisian Macao: (3)

Table games win per unit per day (1)

$

12,258

$

8,289

$

10,055

$

8,289

Slot machine win per unit per day (2)

$

205

$

327

$

225

$

327

Average number of table games

377

404

381

404

Average number of slot machines

1,507

1,517

1,523

1,517

The Plaza Macao and Four Seasons Hotel Macao:

Table games win per unit per day (1)

$

14,627

$

16,126

$

14,066

$

14,580

Slot machine win per unit per day (2)

$

380

$

462

$

444

$

449

Average number of table games

103

93

101

96

Average number of slot machines

221

147

183

147

Sands Macao:

Table games win per unit per day (1)

$

6,853

$

7,046

$

8,206

$

7,297

Slot machine win per unit per day (2)

$

220

$

274

$

240

$

267

Average number of table games

192

244

200

257

Average number of slot machines

1,000

879

919

906

Marina Bay Sands:

Table games win per unit per day (1)

$

10,832

$

9,576

$

10,980

$

8,883

Slot machine win per unit per day (2)

$

666

$

680

$

658

$

664

Average number of table games

580

590

576

595

Average number of slot machines

2,499

2,487

2,493

2,463

Las Vegas Operating Properties:

Table games win per unit per day (1)

$

3,193

$

3,724

$

3,331

$

3,001

Slot machine win per unit per day (2)

$

306

$

284

$

282

$

275

Average number of table games

233

251

241

246

Average number of slot machines

1,892

1,989

1,945

2,001

Sands Bethlehem:

Table games win per unit per day (1)

$

3,651

$

3,421

$

3,539

$

3,404

Slot machine win per unit per day (2)

$

270

$

272

$

271

$

278

Average number of table games

175

177

176

177

Average number of slot machines

3,148

3,146

3,154

3,049

 

(1)

Table games win per unit per day is shown before discounts and commissions.

(2)

Slot machine win per unit per day is shown before deducting cost for slot points.

(3)

The Parisian Macao opened on September 13, 2016.

 

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Room Statistics:

The Venetian Macao:

Occupancy %

90.7

%

93.2

%

90.0

%

83.7

%

Average daily room rate (ADR) (1)

$

224

$

209

$

214

$

215

Revenue per available room (RevPAR) (2)

$

203

$

195

$

193

$

180

Sands Cotai Central:

Occupancy %

93.0

%

89.2

%

84.6

%

80.9

%

Average daily room rate (ADR) (1)

$

148

$

145

$

147

$

149

Revenue per available room (RevPAR) (2)

$

138

$

129

$

124

$

121

The Parisian Macao: (3)

Occupancy %

94.1

%

87.5

%

87.9

%

87.5

%

Average daily room rate (ADR) (1)

$

144

$

138

$

140

$

138

Revenue per available room (RevPAR) (2)

$

136

$

121

$

123

$

121

The Plaza Macao and Four Seasons Hotel Macao:

Occupancy %

80.8

%

80.8

%

80.4

%

73.0

%

Average daily room rate (ADR) (1)

$

335

$

345

$

352

$

348

Revenue per available room (RevPAR) (2)

$

271

$

279

$

283

$

254

Sands Macao:

Occupancy %

95.7

%

97.9

%

97.4

%

96.6

%

Average daily room rate (ADR) (1)

$

191

$

190

$

192

$

200

Revenue per available room (RevPAR) (2)

$

183

$

186

$

187

$

193

Marina Bay Sands:

Occupancy %

96.6

%

98.3

%

95.9

%

97.6

%

Average daily room rate (ADR) (1)

$

445

$

475

$

426

$

415

Revenue per available room (RevPAR) (2)

$

430

$

467

$

409

$

405

Las Vegas Operating Properties:

Occupancy %

97.0

%

96.5

%

94.7

%

94.5

%

Average daily room rate (ADR) (1)

$

232

$

240

$

248

$

244

Revenue per available room (RevPAR) (2)

$

225

$

232

$

235

$

230

Sands Bethlehem:

Occupancy %

96.1

%

97.2

%

93.4

%

94.9

%

Average daily room rate (ADR) (1)

$

164

$

164

$

161

$

159

Revenue per available room (RevPAR) (2)

$

158

$

160

$

151

$

151

 

(1)

ADR is calculated by dividing total room revenue by total rooms occupied.

(2)

RevPAR is calculated by dividing total room revenue by total rooms available.

(3)

The Parisian Macao opened on September 13, 2016.

 

Exhibit 4

Las Vegas Sands Corp. and Subsidiaries

Non-GAAP Measure Reconciliation

(In millions)

(Unaudited)

The following is a reconciliation of Net Income to Consolidated Adjusted Property EBITDA and Hold-Normalized Adjusted Property EBITDA:

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

Net income

$

685

$

606

$

1,901

$

1,409

  Add (deduct):

     Income tax expense

73

69

220

187

     Loss on modification or early retirement of debt

3

5

3

     Other (income) expense

19

(21)

80

33

     Interest expense, net of amounts capitalized

83

65

240

198

     Interest income

(4)

(2)

(11)

(6)

     Loss on disposal or impairment of assets

21

5

27

15

     Amortization of leasehold interests in land

9

10

28

29

     Depreciation and amortization

265

277

913

792

     Development expense

3

3

8

7

     Pre-opening expense

1

86

7

128

     Stock-based compensation (1)

4

2

11

12

     Corporate expense

51

39

136

208

Consolidated Adjusted Property EBITDA

$

1,210

$

1,142

$

3,565

$

3,015

     Hold-normalized casino revenue (2)

(5)

(99)

     Hold-normalized casino expense (2)

(23)

28

Consolidated Hold-Normalized Adjusted Property EBITDA

$

1,182

$

1,071

 

(1)

During the three months ended September 30, 2017 and 2016, the company recorded stock-based compensation expense of $8 million and $7 million, respectively, of which $4 million is included in corporate expense on the company's condensed consolidated statements of operations. During the nine months ended September 30, 2017 and 2016, the company recorded stock-based compensation expense of $26 million and $28 million, respectively, of which $15 million is included in corporate expense on the company's condensed consolidated statements of operations. During the three and nine months ended September 30, 2016, the company recorded stock-based compensation expense of $1 million in pre-opening and development expense on the company's condensed consolidated statements of operations.

(2)

See Exhibit 5.

 

Exhibit 5

Las Vegas Sands Corp. and Subsidiaries

Non-GAAP Measure Reconciliation

(In millions)

(Unaudited)

The following are reconciliations of Adjusted Property EBITDA to Hold-Normalized Adjusted Property EBITDA:

Three Months Ended September 30, 2017

Hold-Normalized

Adjusted

Hold-Normalized

Hold-Normalized

Adjusted

Property

Casino

Casino

Property

EBITDA

Revenue (1)

Expense (2)

EBITDA

Macao Operations

$

652

$

18

$

(28)

$

642

Marina Bay Sands

442

(40)

8

410

United States:

   Las Vegas Operating Properties

76

17

(3)

90

   Sands Bethlehem

40

40

$

1,210

$

(5)

$

(23)

$

1,182

Three Months Ended September 30, 2016

Hold-Normalized

Adjusted

Hold-Normalized

Hold-Normalized

Adjusted

Property

Casino

Casino

Property

EBITDA

Revenue (1)

Expense (2)

EBITDA

Macao Operations

$

628

$

(73)

$

23

$

578

Marina Bay Sands

391

(29)

6

368

United States:

   Las Vegas Operating Properties

86

3

(1)

88

   Sands Bethlehem

37

37

$

1,142

$

(99)

$

28

$

1,071

 

(1)

For Macao Operations and Marina Bay Sands, this represents the estimated incremental casino revenue related to Rolling volume play that would have been earned or lost had the company's current period win percentage equaled 3.15% for Macao Operations and 2.85% for Marina Bay Sands. This calculation will only be applied if the current period win percentage is outside the expected range of 3.0% to 3.3% for Macao Operations and 2.7% to 3.0% for Marina Bay Sands. The company revised the expected target and range for its Macao Operations due to the Rolling win percentage experienced over the last several years. The prior year non-GAAP measurement for our Macao Operations has also been adjusted to reflect this change for comparison purposes.

For the Las Vegas Operating Properties, this represents the estimated incremental casino revenue related to all table games play that would have been earned or lost had the company's current period win percentage equaled 22.0% for Baccarat and 20.0% for non-Baccarat. This calculation will only be applied if the current period win percentages for Baccarat and non-Baccarat are outside the expected ranges of 18.0% to 26.0% and 16.0% to 24.0%, respectively. The company revised the expected target and range for its Las Vegas Operating Properties due to the win percentage experienced over the last several years. The prior year non-GAAP measurement has also been adjusted to reflect this change for comparison purposes.

For Sands Bethlehem, no adjustments have been made.

These amounts have been offset by the estimated commissions paid and discounts and other incentives rebated directly or indirectly to customers.

(2)

Represents the estimated incremental expenses (gaming taxes, bad debt expense and commissions paid to third parties) that would have been incurred or avoided on the incremental casino revenue calculated in (1) above.

 

Exhibit 6

Las Vegas Sands Corp. and Subsidiaries

Non-GAAP Measure Reconciliation

(In millions, except per share data)

(Unaudited)

The following is a reconciliation of Net Income Attributable to Las Vegas Sands Corp. to Adjusted Net Income and Hold-Normalized Adjusted Net Income:

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016 (1)

2017

2016 (1)

Net income attributable to Las Vegas Sands Corp.

$

570

$

513

$

1,595

$

1,161

Nonrecurring corporate expense

79

Pre-opening expense

1

86

7

128

Development expense

3

3

8

7

Loss on disposal or impairment of assets

21

5

27

15

Other (income) expense

19

(21)

80

33

Loss on modification or early retirement of debt

3

5

3

Income tax impact on net income adjustments (2)

1

(19)

Noncontrolling interest impact on net income adjustments

(7)

(28)

(12)

(49)

Adjusted net income

$

607

$

562

$

1,710

$

1,358

Hold-normalized casino revenue (3)

(5)

(99)

Hold-normalized casino expense (3)

(23)

28

Income tax impact on hold adjustments (2)

1

3

Noncontrolling interest impact on hold adjustments

3

15

Hold-normalized adjusted net income

$

583

$

509

The following is a reconciliation of Diluted Earnings per Share to Adjusted Earnings per Diluted Share and Hold-Normalized Adjusted Earnings per Diluted Share:

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016 (1)

2017

2016 (1)

Per diluted share of common stock:

Net income attributable to Las Vegas Sands Corp.

$

0.72

$

0.65

$

2.01

$

1.46

Nonrecurring corporate expense

0.10

Pre-opening expense

0.11

0.01

0.16

Development expense

0.01

0.01

0.01

Loss on disposal or impairment of assets

0.03

0.01

0.03

0.02

Other (income) expense

0.02

(0.03)

0.10

0.04

Loss on modification or early retirement of debt

0.01

Income tax impact on net income adjustments

(0.02)

Noncontrolling interest impact on net income adjustments

(0.01)

(0.03)

(0.01)

(0.06)

Adjusted earnings per diluted share

$

0.77

$

0.71

$

2.16

$

1.71

Hold-normalized casino revenue

(0.01)

(0.13)

Hold-normalized casino expense

(0.03)

0.04

Income tax impact on hold adjustments

Noncontrolling interest impact on hold adjustments

0.01

0.02

Hold-normalized adjusted earnings per diluted share

$

0.74

$

0.64

Weighted average diluted shares outstanding

792

795

793

795

 

(1)

The information for the three and nine months ended September 30, 2016, has been updated to conform to the current presentation.

(2)

The income tax impact for each adjustment is derived by applying the effective tax rate, including current and deferred income tax expense, based upon the jurisdiction and the nature of the adjustment.

(3)

See Exhibit 5.

 



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