The paragraph is from an earnings call for Sands' third quarter of 2024. Daniel Briggs, the Senior VP of Investor Relations, introduces the call, mentioning key executives present, including Rob Goldstein, Patrick Dumont, Dr. Wilfred Wong, and Grant Chum. The call will contain forward-looking statements and non-GAAP measures, with related documents available online. Rob Goldstein highlights the growth of the Macao market, noting a 13% increase in total gaming revenue and a 14% rise in mass gaming revenue compared to the previous year. He expresses confidence in the future growth of the Chinese economy and anticipates Macao's market gross gaming revenues to surpass $30 billion in 2025 and continue growing.

The paragraph discusses the company's strong asset base and business strategy geared towards long-term market leadership and growth, specifically in the Macao and Singapore markets. It highlights the recent opening of the Londoner Grand Casino and suites, along with plans to expand further by 2025. The company focuses on high-quality, large-scale investments to maintain dominance in gaming and non-gaming revenue and EBITDA share. Despite disruptions and challenges, they emphasize their competitive advantage in scale, quality, and product diversity. The completion of their investment programs by 2025 is expected to drive significant growth, particularly in attracting high-value tourism.

In the paragraph, Patrick Dumont discusses the financial performance and future expectations for Macao and Singapore properties. Macao's EBITDA was $585 million, slightly below potential due to lower-than-expected hold, with a margin of 35.1% excluding the Londoner. The Londoner's margins were affected by renovation disruptions. The Venetian and The Plaza and Four Seasons had margins of 38.6% and 39.7%, respectively, with expected improvements as renovations complete. In Singapore, MBS reported $406 million in EBITDA, which could have been $78 million higher with expected hold. Their EBITDA margin of 47.5% reflects progress in tourism investments and ongoing refurbishments, with further benefits anticipated. Completion of Marina Bay Sands' next investment phase is expected by the second quarter of 2025.

The paragraph discusses the company's enthusiasm about investment in the Marina Bay Sands IR2 project to support growth in 2025 and beyond, highlighting the project's expansion and gaming capabilities. The company is focusing on long-term growth in Singapore's leisure and business tourism. It mentions returning capital to shareholders, including a $450 million stock repurchase and a board-approved increased repurchase authorization of $2 billion. It also outlines a quarterly dividend payment and an increase in the annual dividend for 2025. The paragraph then transitions to Q&A, with Joe Greff from JPMorgan asking about Macao's gaming revenue management, specifically on the decline in contra gaming revenues' percentage and its relation to business strategy and promotional activities.

The paragraph discusses the company's focus on efficiency and managing disruptions that have impacted its margins across recent quarters. Despite challenges, such as taking many rooms out of inventory, which affected high-margin revenue, the company is beginning to see the benefits of cost discipline and strategic asset investments. Grant Chum adds that while tactical measures were used in the previous quarter to manage customer transitions during the closure of the old Pacifico Casino, the company has returned to its core strategy of competing based on its products and content, despite increased disruptions in the third quarter.

The paragraph discusses a strong quarterly performance driven by effective customer reinvestment strategies, maintaining market share despite disruptions and a weaker-than-expected base mass recovery. EBITDA grew sequentially even though market GGR slightly declined. Joe Greff asks about Macao's performance, noting stronger-than-expected results in October due to factors like equity price increases and seasonal events like Golden Week. Patrick Dumont refrains from detailing the current quarter but expresses satisfaction with the quality of visitors in Macao and Singapore. He highlights opportunities linked to new products and acknowledges the positive impact of entertainment on attracting high-value tourists.

The paragraph discusses ongoing disruptions at Marina Bay Sands, affecting its EBITDA performance. Currently, they have fewer available rooms due to renovations, with about 1,600 rooms now compared to 2,800 previously. Casino floor work is also causing disruption, though new salon capacity has been added and Sky Gaming introduced. Renovations on Tower 3 are expected to add 150 more rooms by the end of the quarter, and casino operations are impacted by ongoing work. The speaker hopes that disruptions will subside by the middle of next year.

The paragraph discusses the progress and outlook for Londoner and Singapore properties, with Robert Goldstein mentioning that by May 2025, both locations should have overcome disruptions and will begin to see stellar results. Patrick Dumont highlights the quality work done on renovations, especially at Marina Bay Sands, which has attracted high-quality customers despite disruptions. He praises the design team for their achievements, noting strong market conditions and positive customer feedback. Stephen Grambling questions whether there have been any changes to the capital expenditure plans for Marina Bay Sands' IR2 project.

In the paragraph, Robert Goldstein discusses the major changes in a project, highlighting the addition of full casino amenities alongside the existing hotel, which focuses on the premium mass segment. He is confident about the project's success due to its unique market, strong customer segment, and significant barriers to entry. Goldstein expects impressive financial returns, projecting the original integrated resort (IR1) to reach $2.5 billion and the new building to generate over $1 billion. In a follow-up question, Robin Farley inquires about the potential impact of reduced luxury spending by Chinese consumers on this segment.

In the paragraph, Robert Goldstein discusses the resilience and strong growth of Macao's gaming industry, despite the economic challenges in China. He highlights Macao's double-digit growth in the recent quarter and expresses optimism for continued growth, predicting revenues exceeding $30 billion next year. Goldstein contrasts the success of the gaming sector with the struggles faced by retail businesses in Asia. He emphasizes the impressive assets, like the Londoner and the Venetian, which are well-positioned for large-scale operations. He notes that while the return of the base mass market is anticipated to significantly boost revenues, even in the current economic environment, Macao remains a robust and powerful market. Robin Farley acknowledges the positive outlook as being helpful.

The paragraph discusses the impact of recent government stimulus on the recovery of Macao's gaming sector. Robert Goldstein expresses optimism about the government's involvement but cautions that it's too early to predict the specific outcomes or timing of recovery. He notes that Macao was already showing strong growth before the stimulus. Grant Chum adds that Macao's Gross Gaming Revenue (GGR) is resilient, especially in the premium segments, and suggests that any future economic boost from the stimulus will likely benefit the base mass and retail segments. Both emphasize Macao's strong performance in the regional consumer market, particularly in the premium gaming sector.

The paragraph discusses the positive economic outlook for Macao, driven by China's economic stimulus measures. Grant Chum expresses confidence in the Chinese Mainland's economy and announces continued investment in Macao. He highlights Macao as the top-rated destination for Chinese tourists in 2024, expecting economic normalization to benefit the region. The discussion shifts to IR2, with Patrick Dumont indicating future expansion plans for the casino's capacity and describing the upcoming building as a unique and premier gaming and hospitality venue, with further details to be shared in the coming months.

The paragraph discusses a project aimed at enhancing the service, experience, and food and beverage offerings for a high-end market in Singapore, which the speaker believes will significantly add value to their portfolio in the long term. It includes a Skypark, public access components, and MySpace, catering to tourism and luxury segments. The conversation then shifts to Macao, where there was a market recovery in visitation rates in the third quarter, reaching 93% of 2019 levels, with August surpassing 2019 visitation numbers.

The paragraph discusses the economic trends in Macao during the third quarter, emphasizing increased day trip visitors but noting that this didn't significantly boost spending, particularly in the base mass and retail sectors. The strength was mainly seen in premium segments. A reduction of 2,400 rooms at the Sheraton affected the market, as overnight visitors generally spend more than day trippers. Despite these challenges, Macao remains popular as a tourist destination. The discussion shifts to Carlos Santarelli from Deutsche, who questions the timeline and total room count for hotels in Macao, especially considering some rooms might be converted to suites by the next Golden Week.

The paragraph discusses the impact of room availability on EBITDA share, noting that new rooms and suites at Londoner Grand have been successfully delivered by September. However, the total number of available rooms will decrease further in the fourth quarter due to the temporary closure of additional Sheraton rooms. A significant increase in room availability is expected by January, with over 1,000 new suites ready by Chinese New Year and a full inventory of 2,400 keys by mid-second quarter. This increase in rooms is expected to positively impact EBITDA share, with confidence that Londoner Grand and Londoner Macao will perform well due to their high-quality offerings and scale.

The paragraph discusses the excitement and optimism surrounding The Londoner Macao, a luxury hotel with 4,400 suites, and highlights its unique quality and offerings, including food and beverage options and an arena. The speaker is positive about its potential to boost EBITDA and contribute to overall performance as it becomes fully operational by 2025. Additionally, the conversation touches on the impressive average daily rate (ADR) of $900 in Singapore, attributed to the extraordinary quality and design of renovated rooms, which reflects the market’s view and demand for such high-level products. Overall, the focus is on the strong potential and contribution of these assets to the business.

The paragraph discusses the ongoing efforts to make Marina Bay Sands the top hotel in Asia and globally, highlighting the significant investments made in its renovation and amenities, including the anticipated IR2 arena. The arena is expected to boost tourism and drive further growth in average daily rates (ADR). The emphasis is on the hotel's unique features, exceptional service levels, and high-quality offerings, all contributing to a strong demand from both leisure and gamer markets. Despite room compression, the demand is projected to rise, underscoring the property's appeal and the quality of its product.

The paragraph discusses the future prospects of a newly built, highly desirable building in Singapore, noting expectations for increasing rates and gaming demand due to its unique appeal. It then shifts to discussing the renovation of an arena in Macao, emphasizing its importance to their premium mass business. The arena, initially a visionary project by Sheldon, has been a successful driver of visitation in Asia through live entertainment scheduling. The planned updates are expected to enhance its appeal and allow for better control over event scheduling, ultimately boosting visitation and spending at the Venetian and other properties.

The paragraph discusses updates and plans for the Venetian and Londoner arenas in Macao. Grant Chum highlights the successful progress on upgrading the Venetian arena, which will reopen at the end of November or December with upcoming entertainment and sports events. Meanwhile, the Londoner arena has been active, hosting around 17 shows in the third quarter, boosting traffic and spending despite the downtime of the Venetian arena. Both arenas will serve multiple segments such as entertainment, sports, and MICE events, enhancing diversification efforts in Macao. Plans include programming events concurrently in both venues. There are three events currently selling tickets for the end of the quarter, and more major event announcements are expected before the year's end.

Daniel Politzer asks about the regulatory landscape and future outlook for the gaming industry related to Singapore's IR2 project, including licensing and gaming tax rates. Patrick Dumont responds by expressing confidence in the stability of the regulatory environment, noting a moratorium on changes to gaming tax until the early 2030s. He emphasizes the long-term nature of their investment, which aims to support Singapore's tourism goals through gaming and other attractions like an arena, hospitality, and food and beverage options. Dumont is optimistic about the project's high barriers to entry and the value it will bring to Singapore.

The paragraph discusses strategies for achieving higher profit margins in Macao's gaming market. Patrick Dumont explains that reaching high 30% to low 40% margins requires revenue growth and the return of various market segments, particularly the base mass segment, to pre-pandemic levels. The company's investment is designed for scale, appealing to both premium mass and leisure tourists with its extensive offerings. While current challenges include a decline in visitation and base mass play, the team has maintained cost discipline to support existing margins despite reduced revenue.

The paragraph discusses the anticipation of improved revenue and margins through investments that are expected to drive higher value visitation over time. The conversation shifts to addressing a question about potential changes in Macao with the arrival of a new Chief Executive. Robert Goldstein emphasizes the company's commitment to adhering to government requirements and maintaining its focus on investment and compliance in Macao, while not expecting significant changes with the new leadership.

The paragraph discusses a conversation about business operations and investment strategies. Wilfred Wong emphasizes that despite potential leadership changes, Macao's focus on diversifying into non-gaming investments remains stable, and they must listen to government guidance. Chad Beynon inquires about interest in the Middle East market, where a competitor recently received a favorable license, and Patrick Dumont confirms that Las Vegas Sands is continuously evaluating new opportunities. Vitaly Umansky asks about future cash distribution for Sands China in light of future capital expenditure requirements due to the retendering process.

The paragraph discusses the financial considerations regarding Sands China (SCL) and Las Vegas Sands (LVS). Vitaly Umansky asks about the impact of capital expenditures and financing on investor returns, particularly in terms of dividends and capital outflow in Sands China and the financing of Marina Bay Sands Phase 2. Additionally, there's a question about LVS's involvement in the New York licensing process. Patrick Dumont responds by expressing confidence in SCL's performance and future cash flow growth, suggesting that SCL could return to being a dividend-paying entity, contingent on the board's decision. LVS is also actively buying SCL and LVS stock, indicating strong belief in their equity value.

The paragraph discusses the company's long-term capital allocation strategy, focusing on repaying debt to increase flexibility and potentially buy back stock. It expresses the goal for SCL to become a dividend payer, enhancing shareholder value and suggests LVS's interest in owning more shares. The company emphasizes growth, considering new developments in Macao and Singapore as the best use of capital, with plans for high-quality projects like a top-tier hotel and arena. Financing these developments will involve raising cost-efficient debt, leveraging their investment-grade status to maintain a balanced debt-to-equity ratio.

The paragraph discusses a financial strategy involving a 35% equity context and utilizing debt capacity for funding an IR2 development. The company plans to use a delayed draw term loan at the MBS level for construction financing, with equity contributions over time. A rough construction schedule is provided to illustrate cash flow timing, found on Page 46 of the referenced deck. The goal is to maintain investment flexibility in high-growth opportunities while continuing dividends and share repurchases. The conversation then shifts to Robert Goldstein, who is asked about the New York capital allocation process. There are mentions of delays in the New York process, and Robert seeks clarification on the specific question regarding the issue.

The paragraph discusses the uncertainties and considerations involved in the application process for a gambling license in New York. The speaker expresses concerns about the growing influence of online gambling, citing examples from states like New Jersey, Pennsylvania, and Michigan, where online gambling is impacting traditional land-based revenue. The speaker notes that building physical casinos requires significant capital investment and time, and there is a need to understand how the market dynamics, including the growth of online gambling, might affect their plans. The timeline for a decision on the New York license is anticipated to be between late 2025 and early 2026. There is also an implication that if New York were to legalize online gaming, it could necessitate a reevaluation of their proposal.

The paragraph is a discussion involving several individuals regarding the impact of online gambling legalization in various U.S. states on land-based casino revenues. As states like New Jersey, Pennsylvania, and Michigan have introduced online gambling, it's suggested that this trend cannot be ignored when considering capital investments in these markets. Additionally, George Choi from Citigroup brings up observations about minimum bets at the Londoner Grand versus the Londoner Casino, indicating possible differences in market positioning. Robert Goldstein responds, expressing confidence that the Londoner and Venetian will become the dominant market players once the ongoing developments, such as room completions, are finalized by spring 2025.

The paragraph discusses the expected financial trajectory and strategic planning of casino properties in Macao, specifically focusing on the Londoner and Venetian. Both properties aim to generate over $1 billion each in revenue, with the rest of the portfolio contributing another $1 billion. The success is tied to the recovery of base mass gaming, which has recently not correlated with visitation rates as it used to. The hope is pinned on China's economic recovery, which is anticipated to significantly benefit the company (SCL and LVS) in terms of revenue, margin, and growth in Macao. The executive expresses strong confidence that these improvements will materialize.

The article discusses optimism about the recovery and growth prospects for China, particularly in Macao, suggesting that the region and its businesses, including the Four Seasons and Parisian, will thrive. Confidence is expressed in the uniqueness and internal marketing abilities of the portfolio. The conversation shifts to the potential for increased profitability when the base mass market recovers, which is anticipated to drive the company to new opportunities. Subsequently, a dialogue with David Katz notes that Golden Week results surpassed expectations, but Robert Goldstein declines to provide details until a later date, as is customary.

The paragraph instructs participants to disconnect their phone lines and thanks them for their participation, wishing them a good day.

This summary was generated with AI and may contain some inaccuracies.