Las Vegas Sands Corp. outperformed Wall Street analysts’ predictions for the fourth quarter of 2017, despite declining revenues at its Las Vegas properties. This was largely due to robust figures from Asia.
The company continues to be exceedingly optimistic about Las Vegas and is persisting with its plans to construct a new arena there.
The company announced in an earnings call this week that it had posted double-digit percentage increases in revenue and earnings in the fourth quarter of last year, thanks to positive numbers from Sands properties in Macau and Singapore.
Sands reported an adjusted net income of $700 million on a revenue of $3.44 billion, exceeding the predictions of Wall Street analysts. Wall Street had anticipated Sands to report a revenue of $3.27 billion for the fourth quarter. In comparison, Sands reported a revenue of $3.08 billion and an income of $491 million during the same period in 2016.
The Las Vegas casino of the company saw a drop in revenue by 4.6 percent, bringing it down to $124 million. Moreover, despite the hotel room occupancy witnessing a growth of 1.4 percent to reach 91.7 percent, the room rates decreased by 3.9 percent to $244 a night, leading to reduced profitability in its hospitality business.
While net revenue did see an increase, it was only by a modest 2.4 percent. This growth is mainly ascribed to the sales of food and beverages. It was a disappointing quarter for much of Las Vegas, largely due to the impact of the mass shootings at a music festival near Mandalay Bay on October 1. The day of the incident marked the beginning of the fourth quarter.
Properties in Las Vegas owned by Sands include:
- The Venetian Las Vegas
- Palazzo Las Vegas
- Convention Center & Sands Expo
Las Vegas Sands numbers up in Asia
Nonetheless, the company’s figures were boosted by immense success at its properties in Macau and Marina Bay Sands in Singapore.
Sands Macau properties include:
- Venetian Macau
- Sands MacauThe Plaza Macau
- Sands Cotai Central
- The Parisian Macau
These properties collectively witnessed a 49.1 percent increase in net income to $519 million for the quarter. Simultaneously, Marina Bay Sands in Singapore experienced a 14.1 percent rise in revenue to $825 million. Indeed, the fourth quarter concluded a record-breaking year for Marina Bay Sands.
Even though Las Vegas numbers have decreased, Sheldon Adelson, Sands Founder and CEO, stays optimistic about Las Vegas. He is proceeding with his plans to construct a new arena and entertainment venue.
New Las Vegas arena to open in 2020
During the earnings call, Sands President and COO, Rob Goldstein, announced that more details about the 18,500-seat music venue, a joint project with Madison Square Garden, will be disclosed in February. He also verified that construction is set to begin this summer and expected to conclude in 2020.
Construction on the Wynn Paradise Park hotel and lagoon project is already underway at the Wynn Golf Club, south of the site for the new arena. This site is also east of the Sands Expo and Convention Center.
“Expect to see something quite spectacular. It’s going to be an impressive arena,” said Goldstein.
Goldstein echoed Adelson’s thoughts about Las Vegas and its future potential:
Las Vegas is a fantastic place to live and work, with growth making a comeback. It’s becoming more of a lodging-based market than before. The excitement of the Vegas Golden Knights hockey is undeniable and with pro football like the Raiders on the horizon, there’s all the more reason to be here. Las Vegas is poised for some exceptional days ahead. So, why not?
Adelson and Las Vegas Sands Corp. continue to oppose the legalization and regulation of online gambling in the US, citing moral reasons. Adelson has consistently argued that online gambling is too readily available to minors, people under the influence, and those with mental challenges, despite mounting evidence to the contrary.
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