Las Vegas Sands, the casino company that owns the Venetian and Palazzo on the Strip, reported its second-quarter earnings today.
Company: Las Vegas Sands Corp. (NYSE: LVS)
Revenue: $2.92 billion, down 19.4 percent from the second quarter of 2014.
Earnings: $469.2 million, down 30.1 percent from the same quarter last year.
Earnings per share: 59 cents, down 28.9 percent from the same quarter last year.
What it means: Las Vegas Sands is heavily concentrated in Macau, and the persistent struggles of that market weighed down the company’s performance there. Net revenue from the company’s Chinese subsidiary, Sands China Ltd., dropped 25.6 percent year-over-year to $1.77 billion.
A government-led crackdown on corruption has curtailed the amount of high rollers who visit Macau, contributing to a full year of gaming revenue declines for the area, and that continued to hurt Sands this quarter. CEO Sheldon Adelson admitted in a statement that the high-end gaming market in Macau was particularly challenging, but he said his company is focused on the mass market and nongaming segments.
As he has in the past, Adelson sought to impress a sense of optimism despite the Macau turbulence.
“I remain steadfast in my belief that we will grow and prosper in the long term,” he said on a conference call with analysts.
Adelson will soon have more competition in Macau: Other companies, including Wynn Resorts and MGM Resorts International, are building more resorts there. But Adelson said his company is used to thriving in the face of competition — in fact, it has “never not worked in a competitive environment.”
At the same time, he suggested that he can’t be entirely adversarial to the competition. He said the companies can “fight over the customer” but must “work together to help Macau.”
Sands is building, too. Adelson said the Parisian, a $2.7 billion resort his company is developing in Macau, should see a full opening in about 12 months.
The company’s financial challenges this quarter didn’t end in Macau. In Las Vegas, net revenue from the Venetian, Palazzo and Sands Expo Center fell 2 percent from last year to $346 million. And in Singapore, net revenue at the company’s Marina Bay Sands property fell 11.4 percent to $713 million.
However, the company’s Sands Bethlehem casino in Pennsylvania proved to be a bright spot for revenue performance: Net revenue there increased 9 percent year-over-year to $137.5 million.
Sands paid a quarterly dividend of 65 cents per common share, 30 percent more than last year. The company’s total debt was $9.82 billion at the end of the quarter.