LVS Casino Revenue Increases but Some Properties Struggle

The Short Take:

  • Company-wide casino revenue increased by 6.3% versus the same quarter last year, but some of the Las Vegas Sands properties struggled
  • The Macau properties continue to dominate in both overall casino revenues as well as casino revenue growth
  • The Venetian and Palazzo in Las Vegas make up only 4.8% of the company’s casino revenue and saw a year-over-year decline of 4.3%

When Las Vegas Sands (LVS) issues their third quarter 2018 financial report we got an update on various metrics, including the casino revenue for the company and its properties. LVS breaks down its revenue into several categories: casino, rooms, food and beverage, malls, and convention, retail and other.  We’re going to take a deep dive into the casino revenue here.

Company-wide, the third quarter casino revenue for LVS came in at $2.413 billion.  The company provides a breakdown of the casino revenue per property.  The property with the highest casino revenue, by far, is the Venetian Macao.  This casino in China saw revenue of $689 million for the quarter.  In fact, of Las Vegas Sands’ eight properties, four Macao properties were the largest contributors in terms of casino revenue.  The Venetian Macao was followed by Sands Cotai Central ($400 million), Parisian Macao ($321 million) and Sands Macau ($146 million).  The company’s other Macau property, the Plaza Macao, saw casino revenue of $116 million, placing it seventh among the company’s properties.

LVS has one other foreign property – the Marina Bay Sands in Singapore.  Marina Bay saw third quarter casino revenue of $532 million making it the second highest among the company’s casinos.

Domestically, the casinos owned by LVS pale in comparison.  The combined casino revenue of the Venetian and Palazzo in Las Vegas was $121 million.  The company currently owns one other property in the United States – Sand Bethlehem. The Sands’ casino revenue was $88 million for the quarter.  Note: although LVS is in the process of selling the Sands property to Wind Creek Hospitality (which is affiliated with the Poarch Band of Creek Indians of Alabama), as of the September 30 quarter end LVS still owned the Sands.

Here’s an overview of the quarterly casino revenue for the LVS properties:

 

If you’ve ever visited the company’s casinos in Las Vegas, the Venetian and Palazzo, you may be stunned that these two properties make up such a small percentage of the casino revenue for LVS.  Macau and Singapore really are the revenue drivers for this company.  In fact, the Las Vegas operations bring in just 3.6% of the total casino revenue company-wide.  Even the company’s Bethlehem, PA casino contributes more to total casino revenue (5.0%) than the Vegas properties!

Looking at the five Macau properties, the Venetian Macau obviously dominates, contributing 28.6% of the company’s casino revenue.  Combined, the five Macau properties bring in a staggering 69.4% of the casino revenue. Marina Bay Sands in Singapore also carries its weight, contributing 22.0% of the company-wide casino revenue.

Here’s a quick look at the contribution of casino revenue by property:

 

Company-wide, casino revenue for LVS increased 6.3% between Q3 2017 and Q3 2018, from $2.346 billion to $2.413 billion.  But on a property level, half of the casinos saw year-over-year (YOY) growth and half saw declines.  All of the casinos that saw positive YOY growth were in China.

Plaza Macau’s YOY casino revenue growth increased by 24.7%, the largest increase among the company’s properties.  Venetian Macao saw a similar YOY increase of 22.2%.  Two more LVS properties saw double digit year-over-year growth: Sands Cotai Central in Macau and Sands Macau, with growth rates of 17.3% and 12.3% respectively.

On the negative side, Marina Bay Sands in Singapore saw the largest drop in casino revenue, dropping 8.7% from Q3 2017.  Parisian Macao saw a similar YOY decline of 5.9%.  Domestically, the Las Vegas properties’ casino revenue fell 4.3% since the same quarter last year while Sands Bethlehem’s fell 4.0%.

Here’s a rundown of the year-over-year growth rates by property for casino revenue:

 

While the headline number of $2.4 billion in casino revenue and a year-over-year growth rate of 6.3% sounds great, it’s always important to dig a little deeper.  Macau did well overall, but the U.S. operations and Singapore saw some issues last quarter.

We’ll be keeping tabs on LVS and many other casino companies, so make sure to bookmark Ante Research and check back soon!

One Reply to “LVS Casino Revenue Increases but Some Properties Struggle”

  1. The name “Las Vegas Sands” ( LVS ) carries the presumption that the major casino operator is an American powerhouse. Despite being based out of Las Vegas, the Sands casino corporation has put its American expansion on the back burner while financing aggressive growth overseas, particularly in the Asian market. Las Vegas will always be a hub for gaming and entertainment, but CEO Sheldon Adelson is taking advantage of high growth opportunities that the Pacific region presents for opening new casinos and entertainment venues. Macau remains the main revenue driver overseas, but LVS is expanding upon its opportunities in the region and continues to build out the Marina Bay Sands in Singapore.

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