No bad stock

Las Vegas Sands Corp.
CEO : Mr. Robert Glen Goldstein

Quarterly earnings growth(YoY,%)

Period	Revenue	Operating Income	EPS	Release Date
2023 Q2	143.3% YoY	-478.2%	-175.9%	2023-07-19

Grant Chum says,

Improved Margins and Business Mix

• Normalized margins increased by 240 basis points quarter-on-quarter
• LVS has a more profitable business mix compared to 2019, with a greater proportion of mass gaming relative to VIP gaming
• 87% of GGR (Gross Gaming Revenue) in Q2 2023 is from mass gaming, compared to 71% in Q2 2019
• Nongaming revenue is rising as a percentage of total revenues, increasing from 17% in 2019 to 22% in Q2 2023
• Both mix shifts in gaming and nongaming segments are positive for margins

Reinvestment and Increased Capacity

• LVS is reinvesting its revenues to increase its capability to handle more visitors
• Increased headcount to service more hotel rooms
• Room operating capacity was back to 10,700 rooms on average for the quarter
• Heading back to 12,000 operable hotel room capacity for the summer
• Labor shortage issue has dissipated as an impediment

June Recovery and Strong Performance

• June was a standout month for LVS
• Mass revenues almost fully recovered to June 2019 levels
• Visitation recovery in Macao reached almost 70% of 2019 levels
• Key volume metrics showed significant improvement compared to April and May
• Non-rolling drop increased by 15%
• Slot handle was up 9%
• Rolling volume was up 10%

Patrick Dumont says,

Capital Allocation and Growth Opportunities

• The company sees significant growth opportunities in both Macao and Singapore, which will drive the expansion of non-gaming amenities and cash flow.
• Capital will be allocated towards these growth opportunities to expand the asset base and cash flow capacity.

Return of Capital to Shareholders

• The company aims to be shareholder-friendly and is focused on return on capital.
• There will be a balance between share repurchases and dividends in the future, with a focus on shrinking the share count.
• Management intends to be more programmatic about share repurchases and allocate more capital towards it over time.

Dividend and Share Repurchases

• The current dividend size provides flexibility for future investments and allows for future share repurchases.
• Having a balanced capital return program is important for the company.
• Management intends to shrink the share count over time.

Q & A sessions,

Singapore Expansion and Marina Bay Sands

• The company has a strong belief in the future success of Singapore and the positive outlook for the country’s economy.
• Discussions are ongoing with the government regarding the expansion plans for Marina Bay Sands.
• The final form of the project is being adjusted based on market potential, government goals, and the company’s growth strategy.
• Non-gaming programs and lifestyle offerings have been successful in attracting high-value tourists and driving customer visitation.

Macau Market and Visitations

• Air traffic to Macau and Hong Kong is still at around 50% of pre-pandemic levels.
• Visitation and play from China have been increasing each month across the quarter.
• The company expects a return of higher-value customers and an increase in premium mass as air travel from China improves.
• Investments in non-gaming activities are expected to draw more customers to concerts and events, further driving visitation in Macau.

Marina Bay Sands Expansion and Capital Allocation

• The renovation of Marina Bay Sands is ongoing and creating a better product with strong customer response.
• The full earnings potential of the renovated towers will not be reached until the 200 multi-day suites come online.
• The company aims to address cost increases through higher-value customers, pricing, and volumes.
• The return of capital program has been restarted, showing confidence in the long-term performance of the business.
• The company plans to grow the dividend over time and considers share repurchases as part of its capital allocation strategy.

Londoner Expansion and Return Targets

• The Londoner project has been well-received and validated by the market, and the second phase is expected to tap into its earning power.
• Return targets are not directly discussed, but the company sees potential growth in the mass and premium mass segments.
• Investments in hotel rooms and suites are expected to help address the market and improve profitability.
• Rumors about a new hotel tower are not familiar to the company, which is focused on delivering against concession renewal requirements and investing in non-gaming amenities.

Visitation and Spending in Macau

• Premium mass recovered faster than base mass, but both segments showed strong growth in visitation.
• The spend per head is rising in both premium mass and base mass, indicating high-quality and high-value tourism in Macau.
• The company is attracting high-value foreign tourists in addition to domestic visitation.