Las Vegas Sands profit falls 65pc despite Venetian's pulling power

Casino operator Las Vegas Sands Corp, which operates two mega-casino resorts in Macau and is spending up to US$14 billion developing a dozen more in the enclave, said fourth-quarter profit fell 65 per cent on higher operating costs, development expenses and accounting charges.

Nevertheless, revenue at the world's largest gaming company by market value surged 65 per cent to US$1.05 billion for the quarter, following the August 28 opening of the Venetian Macao, the company announced. The US$2.4 billion mega-hotel-casino booked US$500.4 million in sales during its first full quarter, becoming the group's biggest revenue contributor.

The Venetian Macao won back 2.72 per cent of the US$12.34 billion in VIP gaming chips it sold, below the group's ambitious target of 3 per cent but still above the industry standard of 2.4 per cent. The Sands Macao, the group's other casino that opened four years ago, sold US$5.92 billion of VIP chips. Their combined sales made up an estimated 24 per cent of Macau's high-roller market.

In response to stiff competition in the VIP market, which in Macau is controlled by junket agents who bring in players, Las Vegas Sands management said yesterday it would raise commission payments for junkets by about 10 per cent this month.

The new programme switches to a revenue-sharing model but retains some performance-based commissions on chip sales and makes up about 1.22 per cent of chip sales under normal circumstances, compared to the base 1.1 per cent the Venetian previously offered.

Las Vegas Sands executives said the Venetian Macao had received nine million visitors since its opening. The resort now has 270 stores open in a commercial mall with space for 350, compared with about 120 on the opening day.