VEGAS INC Coverage
Las Vegas Sands reported record earnings for the first quarter of 2011, primarily because of stronger results in Macau and operations in Singapore.
The Las Vegas-based casino operator today reported net income increased to $299.4 million in the first quarter of 2011, or 37 cents per share, compared to $53.5 million, or 7 cents per share, in the first quarter of 2010.
But the earnings fell short of the 43 cents per share analysts expected on average, and its shares plunged in after-hours trading on the New York Stock Exchange.
Net revenue for the quarter was a record $2.11 billion, the company reported, an increase of 58.2 percent from $1.33 billion in the first quarter of 2010. EBITDA, a profitability measure that means earnings before interest, taxes, depreciation and amortization, also increased to a record $745.7 million in the quarter.
The company’s two Las Vegas resorts, the Venetian and the Palazzo, delivered $65.2 million in EBITDA for the first quarter, down 38 percent from the first quarter of last year. Net revenue at the resorts totaled $305.1 million compared to $330.5 million in the same period a year ago.
Casino revenue for the year-over-year period fell 46.5 percent while food and beverage revenue increased 11.5 percent. Room revenue declined 6 percent.
The occupancy rate at the Venetian and Palazzo fell from 91.3 percent during the first quarter of 2010 to 83.9 percent in the first quarter this year. The average daily room rate increased 2.4 percent to $212, compared to $207 in the same quarter last year.
The company said 97 percent of occupied rooms at its Las Vegas hotel during the quarter were occupied by cash-paying customers, compared to 68 percent in the first quarter of 2010.
At Marina Bay Sands in Singapore, the company’s $5.5 billion resort that opened in April 2010 produced $284.5 million in EBITDA. Net revenue at the resort totaled $584.9 million for the quarter.
At Sands’ operations in China, net revenue increased 22.6 percent to $1.16 billion in the first quarter of 2011, compared to $945.8 million in the first quarter of 2010. Adjusted EBITDA at the company’s four Macau resorts increased 46.9 percent to $373.8 million.
Sands also indicated in today’s earnings release that it will be building a fifth resort in Macau, a 13.7-million-square-foot development in Cotai, which it said will be its last development to open in Macau for three years.
Sands competitor Wynn Resorts also has plans to build a hotel-casino in Cotai. Wynn Chairman and CEO Steve Wynn said the project would cost between $2 and $3 billion.