Venetian is high roller for Sands China
Hong Kong-listed Sands China, an arm of Las Vegas casino mogul Sheldon Adelson's Sands Corp, said net profit rose 6.4 per cent to US$279.3 million for this year's first quarter from US$262.4 million a year earlier.
Sands China's net revenue for the quarter rose 25.1 per cent to US$1.45 billion, from US$1.16 billion in the same period last year. The Venetian, the firm's giant casino on the Cotai strip, 'delivered solid growth in gaming volumes in each segment of the business', it said in a filing to the Hong Kong stock exchange.
The casino delivered record adjusted property earnings before interest, taxes, depreciation and amortisation (ebitda) - widely used to measure the performance of gaming companies - of US$282 million, a year-to-year increase of 23.6 per cent.
Teng Yee Tan, an analyst at CIMB Securities, said Sands China's first-quarter performance was 'OK'. He said the firm, with two casino resorts in Cotai during the period, was in a better position than companies without a presence there.
Shares of all six firms licensed to operate casinos in Macau struggled in Hong Kong trading yesterday. Sands China fell 2.5 per cent to HK$28.70. Wynn Macau dipped 2.2 per cent, Melco Crown Entertainment 3.2 per cent, MGM China 3.5 per cent, and SJM 3.9 per cent. Galaxy Entertainment led the declines with a 4.1 per cent drop, while the benchmark Hang Seng Index eased only 0.75 per cent.
Aaron Fischer, head of consumer and gaming research for Asia at CLSA, said: 'Casino stocks are high-beta, so they underperformed, as the market was quite weak. There were no valid industry-specific concerns.'
'The investors are taking their profits,' Tan said.
Sands has gained 26.7 per cent since the beginning of the year; during the same period the Hang Seng Index rose 7.7 per cent. Galaxy surged 53 per cent, and Melco Crown rose 46 per cent.
Sands China, which also owns Sands Macau , opened the first phase of its Sands Cotai Central resort only last month, so its performance is not included in the first-quarter results.
Fischer said: 'Sands Cotai Central will be successful, if only because of the addition of around 6,000 hotel rooms when there is an industry shortfall of hotel rooms.'
Melco Crown, a venture of Australian billionaire James Packer and Lawrence Ho Yau-lung, son of casino mogul Stanley Ho Hung-sun, reported its first-quarter profit jumped 17-fold, driven by strong performance of its Cotai casino, City of Dreams.
The company said net profit rose to US$122.1 million from US$7.15 million a year earlier, while revenue increased 27 per cent to US$1.03 billion, in line with CLSA's expectations.
The number of slot machines in The Venetian, which boasts the world's largest gaming space, taking up 550,000 sq ft