Sands China said it is looking toward a November 2015 soft opening of its new Parisian Macao megaresort on Macau’s Cotai Strip with a full unveiling slated for the following March.
The news was announced with the release of the company’s third-quarter results earlier this week and was accompanied by statements from CEO Sheldon Adelson that he would soon be traveling to Japan and South Korea in line with NYSE-listed parent Las Vegas Sands’ pursuit of expansion in those countries and in Vietnam, provided they open their domestic markets.
“Financially, we have the wherewithal to pursue developments in all three of these jurisdictions concurrently, if the opportunity to do so arises,” he said.
Mr Adelson is also chairman and chief executive of LVS, in which he and his family hold a controlling stake.
Company officials said the US$2.7 billion Parisian, whose plans call for a half-scale replica of the Eiffel Tower, will find Hong Kong-listed Sands China (1928) strongly positioned to continue to leverage growth in Macau, which has struggled through an uncharacteristic run of four straight months of year-on-year revenue declines as China’s economy slows and the ruling Communist Party pursues an intense campaign to root out corruption in high places. September revenue was down 11.7% against the same month in 2013, pacing a third-quarter drop of 7% on a 19% fall in VIP revenue, which came in shy of 60% of the total market for the first time in the post-monopoly era.
“As I have said in the past, all things in life are cyclical,” Mr Adelson noted on the earnings call. “We have experienced cyclicality in Macau in the past, and we believe that the current softness in the environment in Macau today is also cyclical, and that it is only a matter of time before the cycle reverses itself.”
In a market also beset by rising labor costs and a new smoking ban, the territory’s mass-market leader managed to overcome a dip in third-quarter revenues to post a 4.3% increase in net income to US$644.6 million, buoyed by margins of more than 45% at the lower segments of its cash table play for the three months ended 30th September—although margin pressure is increasing, the company noted, in the intense competition for play at the higher limits known as “premium mass”.
In all, EBITDA was up 3.3% to $811.6 million 0.4% drop in net revenues to $2.33 billion.
“The important point is that our strategy hasn’t changed,” Mr Adelson said. “Our business will continue to be anchored around the mass market and the secular growth of Chinese tourism.”
LVS, Sands China’s majority owner, reported net revenue of $380.5 million from its Venetian and Palazzo resorts on the Las Vegas Strip, a combined increase year on year of 1.4%, while Marina Bay Sands in Singapore saw revenue fall 5% to $735.5 million.
Adjusted EBITDA corporate-wide was basically flat at +0.6% to $1.28 billion on a 1.1% decline in revenue to $3.53 billion.
Net income came in at $671.7 million, or 83 cents a share, up from $626.7 million, or 76 cents a share, a year earlier. Analysts polled by Thomson Reuters were looking for 84 cents.
