Robust 1Q for Las Vegas Sands - Analyst Blog
26 Abril 2012 - 7:15AM
Zacks
Nevada-based Las Vegas
Sands Corp. (LVS) recently reported adjusted earnings of
70 cents per share in the first quarter of 2012, surpassing the
Zacks Consensus Estimate of 60 cents and 89.2% higher than the
year-ago quarter earnings of 37 cents per share.
On a GAAP basis, the company
reported a net income of $498.9 million or 61 cents per share
compared with $228.2 million or 28 cent per share in the
year-ago quarter. The improvement primarily reflects a rise in
operating income and discontinuation of preferred stock dividend,
partially offset by an impairment loss.
Quarterly net revenue climbed 30.8%
year over year to $2.76 billion, outperforming the Zacks Consensus
Estimate of $2.67 billion. Consolidated adjusted property EBITDA
(earnings before interest, taxes, depreciation and amortization)
shot up 43.0% year over year to $745.7 million.
The significant upside in quarterly
results was attributable to outstanding performance of Macao
business and solid performance of Singapore and Las Vegas
business.
Macao
Businesses
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. Net revenue at Sands China jumped 25.0% year over year to
$1.45 billion during the quarter. Adjusted property EBITDA perked
up 20.5% to $450.6 million during the quarter.
Net revenue increased 21.1% year
over year to $772.8 million at The Venetian Macao, while Sands
Macao earned revenues of $349.1 million, up 8.1%. Moreover,
revenues at Four Seasons Hotel Macao and Plaza Casino surged
74.1% to $299.6 million, driven by strong visitation and growth in
Macao.
Revenue per Available Room (RevPar)
improved across all the three properties; Venetian Macao, Four
Seasons Hotel Macao and Plaza Casino and Sands Macao.
Macao, the only Chinese city where
gambling is legal, is experiencing higher gaming volume due to
gaming-friendly policies of the local government. The performance
at Macao is also driven by strong growth at mass table and slot
businesses, along with the contribution from non-gaming amenities.
On April 11, Las Vegas also opened the first phase of its latest
Integrated Resort offering, Sands Cotai Central at the centre of
the Cotai Strip. We believe that this will drive additional
visitation in Macao and will further boost Las Vegas market share
in Macao.
Las Vegas
Businesses
Net revenue from the Las Vegas
operations, which consist of The Venetian Las Vegas and The
Palazzo, leaped 26.1% year over year to $384.6 million. The upside
in revenue was driven by growth in slot handle, table games play,
and hotel revenues along with stronger group meeting and convention
business. Adjusted property EBITDA shot up 77.6% to $115.8 million.
The company’s Las Vegas business is improving as it continues to
focus on cash revenues to drive visits and is significantly cutting
back on compensation allotment and other promotions. Management
also remains encouraged as convention bookings continue to
improve.
Marina Bay Sands in
Singapore
Marina Bay Sands, which debuted in
April 2010, earned revenues of $848.7 million during the first
quarter of 2012, up 45.1% year over year. The revenue growth was
driven by robust VIP, mass gaming and slot volumes coupled with
strong visitation from all over Asia and higher revenue streams
from non-gaming facilities. Adjusted property EBITDA rose 66.1% to
$472.5 million.
Singaporeis poised to grow as the
surrounding areas have a high propensity to gamble and further
development in transport infrastructure will drive more
tourists.
Balance Sheet
At end of the quarter, the company
had $4.06 billion in unrestricted cash balance. Total debt
outstanding, including the current portion, was $9.9 billion. The
company has scheduled principal payment requirements for 2012 and
2013 of $352.0 million and $543.4 million, respectively.
Our Take
We believe that the company is on
track to deliver solid results. We remain bullish regarding the
growth prospects at Macao and Marina Bay Sands in Singapore is a
significant catalyst for the company. Moreover, performance at Las
Vegas also remains solid benefiting from global travel demand. The
company reported better-than-expected results, which will likely
drive the estimates going forward.
The company holds a Zacks #2 Rank,
which translates into a 'Buy' rating over the short term. We also
maintain our long-tern "Neutral" recommendation on the stock.
One of Las Vegas Sands' primary
competitors MGM Resorts International (MGM) will
report its first quarter 2012 earnings on May 3, 2012.
LAS VEGAS SANDS (LVS): Free Stock Analysis Report
MGM RESORTS INT (MGM): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
MGM Resorts (NYSE:MGM)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024
MGM Resorts (NYSE:MGM)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024