Sands Corporation expressed confidence in the future growth of the Macao market during its third quarter 2023 earnings call, forecasting potential Gross Gaming Revenue (GGR) of $30 to $40 billion. The company also reported a successful quarter with Macao generating $630 million in EBITDA, driven by both gaming and non-gaming revenue. Sands further revealed plans for a $5 billion resort development in New York and announced a $2 billion share repurchase program.
Key takeaways from the call include:
- Sands reported growth in both gaming and non-gaming revenue in Macao, with the market generating $630 million in EBITDA.
- The company expressed optimism about the future growth of the Macao market, projecting potential GGR of $30 to $40 billion.
- Sands highlighted the success of its retail business in Macao, which exceeded pre-COVID numbers.
- Despite ongoing renovations, Marina Bay Sands (MBS) in Singapore showed strong performance.
- Sands is bidding for a license in New York and has secured the Nassau Coliseum for a $5 billion resort development.
- A $2 billion share repurchase program has been authorized by the Board of Directors.
- Sands expects its Macao margin to exceed the 36% achieved in 2019 as the market recovers.
During the earnings call, Sands executives highlighted the strong performance of their properties in Macao, including The Venetian Macao and The Londoner. Both properties have seen robust margins and are expected to continue performing well as visitation to Macao gradually recovers from the pandemic.
The company also discussed potential disruptions due to property renovations, particularly at the Sheraton Towers and Pacifica Gaming. However, Sands plans to minimize impact on guest experience and business operations, expecting to complete the renovations within the next 15-18 months.
In terms of expansion, Sands expressed a particular interest in Singapore, where the suite product has shown significant growth in revenue, increasing from $200 to $770. The company aims to achieve $2 billion in future revenue from this market. Sands is investing $750 million in Phase 2 to improve the room product and casino space in Singapore.
The company also addressed the decline in non-rolling ship win in Macao, attributing it to a mix of factors, including the removal of junket. However, Sands executives expressed optimism for the future, emphasizing strong margins and revenue growth expectations, and the potential for continued growth in tourism in their markets.
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