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Las Vegas Sands Corp. Reports Third Quarter 2009 Results.

Article Excerpt
Consolidated Adjusted Property EBITDAR Increases 11.7 percent to $272.3 Million on Net Revenue Increase of 3.2 percent Venetian Macao Delivers Record Quarterly Adjusted Property EBITDAR of $150.4 Million and Record Quarterly EBITDAR Margin of 30.5% Sands Macao Adjusted Property EBITDAR Increases 81.0 percent to $77.1 Million

LAS VEGAS, Oct. 29 /PRNewswire-FirstCall/ -- Las Vegas Sands Corp. today reported financial results for the quarter ended September 30, 2009.

Company-Wide Operating Results

Net revenue for the third quarter of 2009 was $1.14 billion, an increase of 3.2% compared to $1.11 billion in the third quarter of 2008. Consolidated adjusted property EBITDAR in the third quarter of 2009 increased 11.7% to $272.3 million, compared to $243.8 million in the year-ago quarter.

On a GAAP (Generally Accepted Accounting Principles) basis, operating income in the third quarter of 2009 was $62.4 million, compared to $28.2 million in the third quarter of 2008, an increase of 121.3%. The increase in operating income was principally due to healthy gaming volumes and the steady execution of our cost savings and efficiency initiatives in Macau, which contributed to stronger margins at each of our properties and a record operating performance in Macau overall. Those record results in Macau were partially offset by lower revenues in Las Vegas and an increase in depreciation and amortization expense.

Adjusted net income (see Note 1) increased $12.0 million to $20.1 million, or $0.03 per diluted share, compared to $8.1 million in the third quarter of 2008, or $0.02 per diluted share.

On a GAAP basis, net loss attributable to common stockholders in the third quarter of 2009, which reflects an increase in income tax expense of $73.7 million, or $0.11 per diluted share, was $123.0 million, compared to $32.2 million in the third quarter of 2008. Diluted loss per share was $0.19 compared to a loss of $0.09 in the prior year quarter. The increase in net loss attributable to common stockholders of $90.8 million reflects the increase in income tax expense, which included the recording of a valuation allowance during the quarter on certain of our United States deferred tax assets, as well as increases in preferred stock dividends and accretion on preferred stock, partially offset by an increase in operating income.

Third Quarter Overview

Sheldon G. Adelson, chairman and CEO, stated, "We are pleased to report that our properties in Macau delivered a record performance in adjusted property EBITDAR, led by healthy gaming volumes in combination with the consistent execution of our right-sizing and cost savings programs. These efforts resulted in record adjusted property EBITDAR margin at The Venetian Macao of 30.5%, compared to 26.0% in the prior year quarter, and meaningfully improved EBITDAR margin at Sands Macao of 27.5%, compared to 17.1% during the third quarter of last year.

"While our current quarter's results in Las Vegas reflected unusually low table games hold, which negatively impacted our revenues by approximately $40 million, the execution of our cost savings programs has positioned us to deliver improved operating margins and cash flows as the economy recovers. In addition, we just completed the best quarter in our history with respect to future group room night bookings, and today we have more group rooms on the books for 2010 than we expect to realize in calendar year 2009.

"We remain focused on our de-leveraging strategy and during the quarter we increased our financial flexibility by completing both an amendment of our Macau credit facilities and a $600 million pre-IPO exchangeable bond financing. We also filed an application for a listing of our Macau operations on the Hong Kong Stock Exchange.

"In Singapore, we continue to progress on the development of Marina Bay Sands. After topping off the three 55-story hotel towers in July, we are making progress on the installation of the SkyPark(TM), which is the final major structural feature of the property. We are making steady progress on pre-opening activities for each of the major operational areas of the property and remain focused on opening Marina Bay Sands in the first quarter of 2010."

Cost Savings Program Update

Mike Leven, president and COO, stated, "We have effectively completed the implementation of our cost savings and operating efficiencies initiatives across the company. Our annualized cost savings will exceed $500 million across our entire organization and we will continue to pursue additional areas where savings may be achieved. As of September 30, 2009, we have successfully eliminated approximately 90% of these costs from our current expense run rate, or approximately $450 million on an annualized basis. These ongoing efforts have positioned us to benefit from meaningful operating leverage as economic conditions improve. Our adjusted property EBITDAR margins for the company as a whole reached 23.9% during the third quarter, compared to 22.1% in the year ago quarter.

The Venetian Macao Third Quarter Operating Results

"The Venetian Macao delivered a quarterly record $150.4 million in adjusted property EBITDAR for the third quarter. Visitation to The Venetian Macao continues to lead the market, with over 17.7 million visits in 2009, an increase of 4.5% over the first nine months of 2008. Gaming volumes at The Venetian Macao remain healthy, with slot handle increasing 10.9% compared to the quarter one year ago. Mass table volumes at The Venetian Macao continue to lead the market, at nearly $835 million during the quarter. Our Rolling Volume play was $9.06 billion, with the portion of that volume representing direct play increasing to...

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