China – Sands China reports record visitation
A record 5.6m visited casinos owned by Sands China in July, representing a jump of 34 per cent compared to July last year.
Sands China President and Chief Executive Edward Tracy said July’s performance highlighted the operator’s commitment making Macau a global attraction by diversifying its tourism industry.
The news came as Sands announced an all-time half year record EBIDTA of US$1,280m. Total net revenues for the group increased 39.4 per cent to US$4,070.3m in the first half of 2013, compared to US$2,920.5m in the first half of 2012 with profit increasing by 113.8 per cent to US$940.5m.
A spokesperson stated: “We generated an all-time half year record of US$1,280.1m of adjusted EBITDA, an increase of 46.6 per cent compared to US$873m in the first half of 2012. Excluding pre-opening expenses of Sands Cotai Central and the impairment losses related to Parcels 7 and 8 and the closure of the ZAiA show at The Venetian Macao for the six months ended June 30, 2012, adjusted profit increased 40 per cent to US$945.9m in the first half of 2013. Net revenues increased in most of the segments, mainly driven by the full operation of our newest integrated resort, Sands Cotai Central, as well as strong visitation resulting from continuous efforts in marketing and management’s focus on driving the high-margin mass market gaming segment, while continuing to provide luxury amenities and high service levels to our VIP and premium players.
Our net casino revenues for the six months ended June 30, 2013 were US$3,650.7m, an increase of 40.8 per cent. The increase was primarily attributable to an increase of US$807.2m at Sands Cotai Central driven by the opening of phase IIA in September 2012 and our VIP gaming expansion in February 2013, and an increase of US$341.6m at The Venetian Macao driven by an increase in volume in our mass market segment.”
There could be some hefty charges on the way though if Sands doesn’t complete construction deadlines for its two latest projects with the land housing the projects also at risk.
The company warned: “Under the land concession for Sands Cotai Central, we are required to complete the development by May 2014. We will be applying for an extension from the Macao Government to complete Sands Cotai Central, as we will be unable to meet the May 2014 deadline. The land concession for The Parisian Macao contains a similar requirement, which was extended by the Macao Government in July 2012, that the development be completed by April 2016. Should we determine that we are unable to complete The Parisian Macao by April 2016, we would then also expect to apply for another extension from the Macao Government. If we are unable to meet The Parisian Macao deadline and the deadlines for either development are not extended, we could lose our land concessions for Sands Cotai Central or The Parisian Macao, which would prohibit us from operating any facilities developed under the respective land concessions. As a result, the Group could record a charge for all or some portion of the US$4.17bn or US$222.6m in capitalised construction costs including land, as at June 30, 2013, related to Sands Cotai Central and The Parisian Macao, respectively.”
