Leading international developer of multi-use integrated
Las Vegas Sands Corp.
) recently reported fourth quarter 2012 adjusted earnings of 54
cents per share; below the Zacks Consensus Estimate of 59 cents
and the year-ago quarter's earnings of 57 cents per share.
The earnings in the quarter have declined with the rise of net
income, attributable to non-controlling interests. However, it
was partly neutralized by the company's high operating
On a GAAP basis, the company reported a net income of $434.8
million or 53 cents per share in the fourth quarter 2012 compared
with $320.1 million or 39 cents per share in the year-ago
For full year 2012, the company reported an adjusted net
income of $1.77 billion or $2.14 per share compared with $1.64
billion or $2.02 per share in the prior-year period. Reported
earnings for 2012 were below the Zacks Consensus Estimate of
Quarterly net revenues climbed up 20.9% year over year to
$3.08 billion, which was ahead the Zacks Consensus Estimate of
$2.99 billion. Consolidated adjusted property EBITDA (earnings
before interest, taxes, depreciation and amortization) surged
4.4% year over year to $1.0 billion.
The significant upside in quarterly results was attributable
to the company's strong Macau business. In 2012, net sales were
$11.13 billion, up 18.3% year over year but below the Zacks
Consensus Estimate of $12.7 billion. Consolidated adjusted
property EBITDA surged 7.3% to $3.8 billion, which was a record
for the company.
Adjusted Property EBITDA in Macao recorded at $622.2 Million,
which witnessed an increase of 43.3% year over year owing to the
high gaming volumes in the region.
Las Vegas Sands' integrated resort properties and other assets
in Macao are owned and operated by Sands China Ltd., which is a
majority-owned subsidiary of the company. During the quarter, net
revenue at Sands China was $1.97 billion, jumped 48.1% year over
year. Adjusted property EBITDA amounted to $619.9 million, up by
a massive 44.1% from the year earlier quarter.
Net revenue increased 10.3% to $843.0 million at The Venetian
Macao, driven by higher than anticipated Rolling Chip win of
3.25% whereas Sands Macao revenues were down 2.0% to $314.6
million. Moreover, revenues at Four Seasons Hotel Macao and Plaza
Casino surged 36.9% to $296.2 million. Net revenue at Sands Cotai
Central, the first phase of which was opened on April 11, 2012,
was $490.7 million.
Revenue per Available Room (RevPAR) fell 1.3% and 2.0%,
respectively, at Venetian Macao and Sands Macao, but leaped 21.3%
at Four Seasons Hotel Macao and Plaza Casino.
We believe facilities of Sands Cotai will drive additional
visitation in Macao and will further boost Las Vegas' market
share in Macao with its high gaming potential. The property
witnessed a footfall of nearly 3 million during the fourth
Las Vegas Businesses
Net revenues from the Las Vegas' operations, comprising The
Venetian Las Vegas and The Palazzo, plunged 9.2% year over year
to $308.3 million. The decline in revenue was due to the fall in
the percentage of table games play and casino revenue. Adjusted
property EBITDA declined 34.7% to $52.8 million.
Marina Bay Sands in Singapore
Revenue at Marina Bay Sands, which made its debut in April
2010, dropped 11.1% to $717.2 million during the fourth quarter
of 2012. The decline in revenue was due to a lower Rolling Chip
win. Adjusted property EBITDA declined 29.1% to $302.5 million.
However, the Marina Bay Sands enjoyed RevPAR growth of 10%,
driven by higher occupancy and average daily rate.
Sands Bethlehem in Bethlehem, Pennsylvania opened the first
phase of its facilities for business on May 22, 2009. Net
revenue at Sands Bethlehem was $117.8.0 million in fourth
quarter, up 12.2% year over year. Adjusted property EBITDA
increased 22.2% to $27.5 million.
At end of the reported quarter, the company had $2.51 billion in
unrestricted cash balance. Total debt outstanding, including the
current portion, amounted to $10.23 billion. The company has
scheduled principal payment requirements of $97.8 million for
During the fourth-quarter 2012, a special dividend of $2.75
per share and a recurring dividend of 25 cents per share were
paid by the company.
The company also raised its quarterly dividend by 40% to 35
cents per share. The increased dividend will be paid from the
beginning of the first quarter of 2013.
The company reported lower-than-expected results due to weak
business in Singapore and Las Vegas. However, we remain bullish
regarding the growth prospects of Macau business.
Las Vegas currently holds a Zacks Rank #2 (Buy). Moving ahead,
other casino companies, which are expected to perform well,
Melco Crown Entertainment Limited
MGM Resorts International
MTR Gaming Group, Inc.
). Melco Crown carries a Zacks Rank #1 (Strong Buy), whereas MGM
Resorts and MTR Gaming carry a Zacks Rank #2 (Buy).
LAS VEGAS SANDS (LVS): Free Stock Analysis
MGM RESORTS INT (MGM): Free Stock Analysis
MTR GAMING GRP (MNTG): Free Stock Analysis
MELCO CROWN ENT (MPEL): Free Stock Analysis
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