Las Vegas Sands Chairman and CEO Robert Goldstein says the company’s Macau gaming business could not be as successful as it is without the multi-billion investment it continues to make into non-gaming.
In an interview with CNBC International published over the weekend (although recorded at the opening of The Londoner Macao in May), Goldstein described the role of non-gaming as misunderstood, despite gaming continuing to generate the majority of Sands China’s revenues each year.
The company did, however, reveal during its recent 2Q23 earnings call that non-gaming’s contribution to revenues had grown to 22%, up from 17% during the same period in 2019.
“That’s the funny thing about our business – this idea that there is gaming and there is non-gaming,” Goldstein told CNBC. “They work in tandem and that’s what makes our success here.
“Anyone can build a casino. That’s not difficult – they are easy to build. The trick is building non-gaming hotels, great spas, hundreds of restaurants, hundreds of retail stories, huge MICE space, huge theaters. That’s the trick of our business. The gaming piece is pretty simple.
“What we try to do is build hotels that work in tandem so the gamers want to come and the non-gamers want to come. You can come here and shop for three days or spa for three days and never go into the casino. So, they are not mutually exclusive – they work in tandem. That’s one of the confusions the market has about non-gaming. Our non-gaming is a multibillion-dollar business, huge, every year.”
Asked if the Macau government’s insistence on focusing on non-gaming under last year’s re-tendering of gaming concessions makes the city less attractive, Goldstein replied, “It’s the opposite. it makes the city very attractive because non-gaming feeds gaming.
“The government is right to focus on growing the content, to focus on the growth of tourism. The growth of tourism can have a basis in non-gaming aa well as gaming. Again, they work together. Those non-gaming amenities are incredibly important to non-gaming as well as to gaming.”
Goldstein, who oversees Sands China’s US-based parent company Las Vegas Sands, also addressed the issue of China’s strained relationship with the United States by calling for dialogue between the two global powers.
“We’ve always been big believers that it’s essential the US and China have a dialogue, to keep talking,” he said when asked how he navigates the company’s connection to both.
“These two countries have an obligation to the world to stay connected and not to close the door to communication. That’s always been our belief. Beyond that though my challenge is my business every day – growing my business and being a good employer of a team that delivers on our promise to the customer.
“China and the US will sort their problems out. We’ll navigate that by staying out of it but also by being advocates for dialogue. We talk to the governments of both. The biggest mistake we make in the world today I think is these countries don’t have communication. This idea of shutting to cold war type of thing is insane, it doesn’t help anyone.
“But my little world is simple – I just keep running my business and keep focussed.”
As reported by IAG, Sands China returned to profit for the first time in three-and-a-half years in 2Q23, with the company reporting net income of US$187 million – reversing a US$422 million loss a year earlier and a US$10 million loss in the March 2023 quarter.
