Las Vegas Sands Corp. 2Q12 Financial Results. July 25, 2012

Transcription

1 Las Vegas Sands Corp. 2Q12 Financial Results July 25, 2012

2 Forward Looking Statements This presentation contains forward looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of Forwardlooking statements involve a number of risks, uncertainties or other factors beyond the company s control, which may cause material differences in actual results, performance or other expectations. These factors include, but are not limited to, general economic conditions, competition, new ventures, substantial leverage and debt service, government regulation, legalization of gaming, interest rates, future terrorist acts, influenza, insurance, gaming promoters, risks relating to our gaming licenses, certificate and subconcession, infrastructure in Macao and other factors detailed in the reports filed by Las Vegas Sands Corp. with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward looking statements, which speak only as of the date thereof. Las Vegas Sands Corp. assumes no obligation to update such information. 2

3 Second Quarter 2012 Highlights 1 Net revenue increased to $2.58 billion (+10.1%) Adjusted property EBITDA of $844.7 million ( 6.3%) for the quarter was negatively impacted by: Low table games hold on a hold adjusted basis, adjusted property EBITDA grew 7.9% to $932.6 million Higher provision for accounts receivable in Singapore ($39.9 million in 2Q12 compared to $11.4 million in 2Q11) Opened first phase of Sands Cotai Central on April 11, 2012 and generated $51.8 million in adjusted property EBITDA in first 81 days Strength of balance sheet, cash flows and earnings allowed us to: Declare a third consecutive quarterly dividend of $0.25 per common share on July 25, 2012 Retain ample liquidity to pursue future growth opportunities in our current markets and in new markets around the world With Sands Cotai Central Opening, Meaningful Growth Opportunities Across Cotai Strip Properties 1. All comparisons present the second quarter 2012 against the second quarter 2011 unless otherwise specified 3

4 Second Quarter 2012 Financial Results $ in millions, except per share information 2Q11 2Q12 $ Change % Change Net Revenue $ 2,345.1 $ 2,581.9 $ % Adjusted Property EBITDA $ $ $ (56.9) 6.3% Adj. Property EBITDA Margin 38.4% 32.7% (570) bps Adjusted Diluted EPS $ 0.54 $ 0.44 $ (0.10) 18.5% 1 Dividend per Common Share $ $ 0.25 $ 0.25 N/A Hold Adjusted Adjusted Property EBITDA $ $ $ % Hold Adjusted Adj. Property EBITDA Margin 37.9% 34.3% (360) bps 1. Adjusted diluted EPS was negatively impacted by low table games hold, increased provision for accounts receivable in Singapore and elevated legal expenses in the second quarter of 2012 compared to the second quarter of

5 Second Quarter 2012 Overview by Market Strong mass table and slot growth record consolidated non rolling win and slot win of $577.1 million (+30.7%) and $122.0 million (+27.3%), respectively Macao VIP initiatives meaningfully growing rolling volume record consolidated rolling volume of $33.35 billion in 2Q12 (+36.3%) Increased retail mall (+37.1%) and hotel (+24.0%) revenues reflect strength of integrated resort business model Mass win per day increased 8.9% to $4.52 million per day Singapore Rolling volume was $11.51 billion ( 5.9%) and rolling hold was 2.42% Continued growth in high margin hotel revenue (+30.0%) and retail mall revenue (+13.0%) Table games drop increased (+2.9%) driven by high end baccarat play Las Vegas Bethlehem Strong slot handle (+8.2%) Investments in room product, Venetian casino redesign and new entertainment offerings should benefit property in the future Steady operating performance event center to drive growth in future Strong growth in table games drop (+44.2%) and slot handle (+6.8%) 5

6 Las Vegas Sands Corp. Consolidated Adjusted Property EBITDA and Margin Adjusted Property EBITDA and Adjusted Property EBITDA Margin Composition of 2Q12 Adjusted Property EBITDA ($MM) $1,000 $901.6 $864.1 $844.7 $ % Bethlehem 3% $ % 37.9% 34.3% 40% Las Vegas 8% $ % 30% $400 20% Singapore 39% Macao 50% $200 10% $0 2Q11 2Q12 0% Adj. Prop. EBITDA Hold Adjusted Adj. Prop. EBITDA Adj. Prop. EBITDA Margin Hold Adjusted Adj. Prop. EBITDA Margin 6

7 Macao Operations Second Quarter 2012 Summary Adjusted property EBITDA for Macao property operations of $429.0 million (+9.6%) On a hold adjusted basis, adjusted property EBITDA for Macao property operations would have been $446.6 million (+22.9%) Consolidated gaming volumes reflected strong growth in each segment Consolidated rolling volume increased 36.3% to record $33.35 billion Consolidated non rolling win increased 30.7% to $577.1 million Consolidated slot win increased 27.3% to record $122.0 million High margin retail mall revenue at The Venetian Macao and Four Seasons Macao increased 28.6% to $52.6 million ($MM) $500 $400 $300 $200 $100 $0 $6.0 $3.0 $0.0 Adjusted Property EBITDA and Adjusted Property EBITDA Margin $ % 2Q11 Adj. Prop. EBITDA $363.4 Adj. Prop. EBITDA Margin $429.0 $ Q12 Hold Adjusted Adj. Prop. EBITDA 50% 40% 30% 20% 10% Hold Adjusted Adj. Prop. EBITDA Margin Mass Table, Slot and ETG Win Per Day ($MM) +30.7% $ Venetian Macao 31.9% Plaza Casino 2Q Sands Macao 29.5% Sands Cotai Central 2Q % 5.9 Total SCL Strong Growth in Every Segment of the Macao Gaming Market 7

8 Sands Cotai Central Phase I Opened April 2012 Cotai Strip, Macao Integrated resort of ~13.7 million SF (upon completion of all phases), which will significantly expand our footprint on the Cotai Strip Phase I opened on April 11, 2012 and currently features: Mass gaming floor with 192 gaming tables and 904 slot machines, including 250 ETG seats Phase III Phase I Phase IIA Phase IIB Paiza Club VIP gaming area with 152 tables 636 Conrad branded hotel rooms and 1,224 Holiday Inn branded hotel rooms Portion of over 1.2 million SF of retail, entertainment, dining facilities and MICE space Phase IIA will open September 20, 2012 and will feature: Additional mass gaming floor with ~200 gaming tables and ~1,300 slot machines Up to 2,500 Sheraton branded hotel rooms Additional amenities Phase IIB will open progressively beginning in October 2012 and will feature: ~1,500 Sheraton Towers branded hotel rooms Phase III is expected to include a fourth luxury St. Regisbranded hotel and mixed use tower 8

9 Our Macao Mass Market Gaming Opportunity Significant opportunity to grow mass gaming revenue by optimizing mass and premium mass tables, slots and ETGs in our Cotai Strip properties Our objectives: Meaningful growth in mass tables win per unit per day Meaningful growth in slot and ETG win per unit per day SCL 2Q12 Operating Results vs. Macao Market Mass Win per Table per Day Slot and ETG Win per Unit per Day $10,000 $8,000 $7,322 $7,984 $9,105 $450 $341 $395 $6,000 $300 $240 $4,000 $2,000 $150 Est. Units at 6/30/12 $0 Sands Macao SCL Cotai Ops Flagship Properties¹ $0 Sands Macao SCL Cotai Ops Flagship Properties¹ ,196 1,204 3,237 5, Reflects the 1Q12 (except Wynn Macau which is 2Q12) estimated average for: City of Dreams, Galaxy Macau, Grand Lisboa, MGM Grand and Wynn Macau. See slides 23 and 24. 9

10 Our Advantage in Macao Maximizing Our Mass Market Opportunity 5 Keys To Mass Market Success SCL s Asset Base Upon Full Opening of Sands Cotai Central Comparison to Macao Market 1 Table Capacity ~1,000 mass tables ~18% of mass tables 2 Slot and ETG Capacity 6,000+ slot machines and ETGs ~31+% of slot machines 3 Hotel Rooms 9,324 4/5 star hotel rooms 39% of 4/5 star hotel inventory 4 Convenient Food Offerings Over 100 restaurants and food outlets Offerings range from affordable to high end 5 Retail Amenities The Grand Canal Shoppes Shoppes at Four Seasons Shoppes at Sands Cotai Central Largest retail footprint in Macao Our Assets Are Principally Located on the Cotai Strip, Which Should Capture the Lion s Share of Future Growth in the Macao Market 10

11 Marina Bay Sands Operations Second Quarter 2012 Summary Adjusted property EBITDA of $330.4 million, a decrease of 18.5%, was negatively impacted by: Adjusted Property EBITDA and Adjusted Property EBITDA Margin Lower rolling volumes and rolling win percentage Provision for accounts receivable was $39.9 million in 2Q12 compared to $11.4 million in 2Q11 Mass gaming volumes reflected steady growth Non Rolling win increased 6.9% to $267.5 million Slot win increased 12.7% to $143.9 million ($MM) $500 $400 $300 $200 $100 $0 $ % 2Q11 Adj. Prop. EBITDA $405.4 $387.7 $ % 47.6% 50.3% 2Q12 Hold Adjusted Adj. Prop. EBITDA 65% 60% 55% 50% 45% 40% Total mass (non rolling tables and slots) win per day during the quarter increased 8.9% to reach $4.52 million Rolling volume of $11.51 billion (with hold of 2.42%) in 2Q12 compared to $12.23 billion in 2Q11 (at 2.99% hold) Non gaming amenities demonstrated strong growth during the quarter Hotel RevPAR increased 29.9% to $348 and occupancy increased to 99.1% Room revenue increased 30.0% to $80.1 million Mall revenue increased 13.0% to $37.4 million ($MM) $5.0 $4.0 $3.0 $2.0 $1.0 $0.0 Adj. Prop. EBITDA Margin $4.15 $1.40 $2.75 $2.94 2Q11 Non Rolling Tables Hold Adjusted Adj. Prop. EBITDA Margin Non Rolling Table and Slot Win Per Day $4.52 $1.58 2Q12 Slot Machines Solid Performance Across Mass and Non Gaming Segments Lower Rolling Volume and Hold 11

12 Las Vegas Operations Second Quarter 2012 Summary Adjusted property EBITDA of $64.4 million, a decrease of 30.7%, was negatively impacted by low table games win percentage Table games drop, led by strong baccarat play, increased 2.9% to $434.6 million Slot handle increased 8.2% to $445.1 million ($MM) $100 $75 $50 $25 Adjusted Property EBITDA and Adjusted Property EBITDA Margin $ % $83.0 $76.9 $ % 19.7% 21.6% 40% 30% 20% Cash ADR increased 6.2% to $207 $0 2Q11 Adj. Prop. EBITDA 2Q12 Hold Adjusted Adj. Prop. EBITDA 10% Investments in room refurbishment, Venetian casino remodel and entertainment offerings underway Best opportunities for future growth: High end Asian gaming Group room pricing growth in 2013 and beyond ($MM) $500 $400 $300 $200 $100 $0 Adj. Prop. EBITDA Margin $422 $435 $203 $189 $219 $245 2Q11 Baccarat Hold Adjusted Adj. Prop. EBITDA Margin Composition of Table Games Drop 2Q12 Non Baccarat Las Vegas is Stable... And We Are Investing in Our Properties for the Future 12

13 Sands Bethlehem Operations Second Quarter 2012 Summary Adjusted property EBITDA increased 28.1% to $26.9 million Table games drop was a record $218.4 million, an increase of 44.2% Slot handle increased 6.8% to $1.01 billion Retail outlet mall (150,000 SF) opened in November stores currently open, with an additional 11 stores to open in the future Events Center (50,000 SF) opened May 16, 2012 ($MM) $30 $25 $20 $15 $10 $5 $0 ($MM) $250 $200 $150 $100 $50 $0 Adjusted Property EBITDA and Adjusted Property EBITDA Margin $ % 2Q11 Adj. Prop. EBITDA $ % Adj. Prop. EBITDA Margin $152 $92 $60 2Q11 Baccarat $ % $ % 2Q12 Hold Adjusted Adj. Prop. EBITDA 30% 25% 20% 15% 10% Hold Adjusted Adj. Prop. EBITDA Margin Composition of Table Games Drop $218 $118 $100 2Q12 Non Baccarat Table Games, Slots, Hotel and Events Center All Contributing to Growth 13

14 Financial Highlights Despite low table games win percentage, generated strong cash flow from operations during the quarter Completed refinancing of Singapore credit facility increasing financial flexibility Upon the completion of Sands Cotai Central: Project capital expenditures will be meaningfully reduced Free cash flow will expand Ongoing dividend programs at both LVS and SCL Upgraded to BB+ credit rating with a positive outlook in April 2012 (one notch below investment grade) 14

15 Financial Strength On July 25, 2012 our Board of Directors declared our third consecutive quarterly dividend of $0.25 per common share Expected return of over $800 million of cash to shareholders through dividend payments in 2012 ($MM) 6/30/12 Cash, Cash Equivalents and Restricted Cash $ 3,529.6 Debt $ 9,374.2 Net Debt $ 5,844.6 Trailing Twelve Months EBITDA $ 3,796.0 Gross Debt to Trailing Twelve Months EBITDA Net Debt to Trailing Twelve Months EBITDA 2.5 x 1.5 x Our strong balance sheet and cash flow position the company to simultaneously: 1. Invest in high return projects for continued organic growth 2. Pursue promising growth opportunities around the world 3. Return capital to shareholders 15

16 Disciplined Execution of Our Global Growth Strategy Development Opportunity Parameters Minimum of 20% return on total invested capital 25% 35% of total project costs to be funded with equity project financing (65% 75% of total project costs) in place before construction begins Areas of Focus for Las Vegas Sands Macao Parcel 3 Japan South Korea Singapore MBS Expansion Vietnam Canada Europe 16

17 The Investment Case for LVS We have the largest asset base in Macao, the world s largest and most profitable gaming market We have meaningful growth opportunities in every segment of the Macao market We have the premier Integrated Resort in Singapore, which is a duopoly environment Our track record, strong cash flow and balance sheet, and leadership team position us to: Execute our strategy to deliver organic growth in our current markets and make additional investments in those markets Pursue promising development opportunities around the world Return capital to shareholders through a recurring annual dividend, payable quarterly, of $1.00 per common share Stated objective of increasing the dividend over time 17

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19 Appendix

20 Historical Hold Adjusted Adj. Property EBITDA 1 $ in millions 2Q11 3Q11 4Q11 1Q12 2Q12 Macao Property Operations Reported $ $ $ $ $ Hold Adjusted $ $ $ $ $ Marina Bay Sands Reported $ $ $ $ $ Hold Adjusted $ $ $ $ $ Las Vegas Operations Reported $ 92.9 $ 94.3 $ 80.9 $ $ 64.4 Hold Adjusted $ 83.0 $ 85.1 $ 82.0 $ 98.6 $ 76.9 Sands Bethlehem Reported $ 21.0 $ 25.2 $ 22.5 $ 27.5 $ 26.9 Hold Adjusted $ 21.6 $ 25.5 $ 22.4 $ 26.8 $ 27.3 LVS Consolidated 2 Reported $ $ $ $ 1,066.5 $ Hold Adjusted $ $ $ $ $ This schedule presents hold-adjusted adjusted property EBITDA based on the following methodology: (a) for Macao operations and Marina Bay Sands: if the quarter s junket and/or premium direct rolling win percentage is outside of the 2.70%-3.00% band, then a hold-adjustment is calculated by applying the respective segment s trailing twelve months win percentage to the rolling table volume in that segment for the quarter (b) for Las Vegas operations and Sands Bethlehem: calculated by applying the trailing twelve months win percentage to each quarter s table games drop (c) for all properties: gaming taxes on incremental win are applied to determine the EBITDA impact 2. Reflects consolidated EBITDA inclusive of Other Asia segment 20

21 Vital Drivers for Continued Mass Market Growth Growth Driver Enhanced Transportation Infrastructure Increased Hotel Capacity Continued Economic Growth in China Addressing the Growth Driver High Speed Rail development throughout China (ongoing) Completion of inter city rail to Macao (2H2012) Macao Hong Kong Zhuhai Bridge (est. 2016) Macao Permanent Ferry Terminal near Cotai Strip (mid 2013) Opening of hotel rooms at Sands Cotai Central 1,860 rooms opened on April 11, 2012 Up to 2,500 rooms on September 20, 2012 ~1,500 rooms opening progressively in October ,000+ hotel rooms to be developed on Hengqin Inland, adjacent to Macao 1 $5.9 trillion economy that grew at 9.2% in Growing Middle Class with rising disposable income Government policies to encourage higher consumption to drive economic growth China is expected to overtake Germany and the U.S. as the largest outbound tourism market in the world in Deeper Penetration into Mainland China Sources: (1) BofA-ML report dated January 5, 2012; (2) China s National Bureau of Statistics; (3) China Outbound Travel and Tourism Market 21

22 Meaningful Opportunities to Grow VIP Volumes Macao Market Estimated Rolling Volume per Table per Day Macao Market Estimated Rolling Volume per Table per Day ($US MM) $2.0 $1.8 Non SCL Flagship Properties $1.78 $1.85 $1.6 $1.4 $1.2 $1.0 $0.8 $0.99 $0.82 $0.71 $1.31 $1.12 $1.12 $1.15 $1.21 $0.90 $1.31 Non SCL Flagship Property Market Average $0.6 $0.50 $0.58 $0.4 $0.2 $0.0 Sands Macao Venetian Macao Plaza Casino Sands Cotai Central Total Sands China Avg. of Non SCL Flagship Properties City of Dreams MGM Grand Wynn Macau Galaxy Macau Galaxy StarWorld Grand Lisboa All Other Casinos Total Est. Avg. # of Rolling Tables ,341 OUR OPPORTUNITY: Grow Rolling Volume Per Table to Match Flagship Property Average 1. Reflects 2Q12 results for Sands China properties and Wynn Macau. The results for all other properties presented are from 1Q12 Source: Company filings; sell side analyst models and reports 22

23 Non Rolling Table Games Macao Market Estimated Non Rolling Win per Table per Day Macao Market Estimated Non Rolling Win per Table per Day 1 ($US) $14,000 Non SCL Flagship Properties $12,000 $10,000 $8,000 $6,000 $7,322 $9,503 $12,199 $4,759 $8,063 $9,105 $7,320 $8,208 $8,729 $10,837 $11,042 $9,105 Non SCL Flagship Property $7,272 Market Average $4,000 $2,000 $0 Est. Avg. # of Non Rolling Tables Sands Macao Venetian Macao Plaza Casino Sands Cotai Central Total Sands China Avg. of Non SCL Flagship Properties Galaxy Macau Grand Lisboa MGM Grand Wynn Macau City of Dreams All Other Casinos ,246 Total 3, Reflects 2Q12 results for Sands China properties and Wynn Macau. The results for all other properties presented are from 1Q12 Source: Company filings; sell side analyst models and reports 23

24 Slot Machines and Electronic Table Games Macao Market Estimated Slot and ETG Win per Unit per Day ($US) $800 $700 Macao Market Estimated Slot and ETG Win per Unit per Day 1 Non SCL Flagship Properties $752 $650 $600 $500 $400 $300 $200 $240 $295 $397 $314 $395 $219 $243 $313 $499 $395 Non SCL Flagship Property Market Average $100 $108 $0 Sands Macao Venetian Macao Plaza Casino Sands Cotai Central Total Sands China Avg. of Non SCL Flagship Properties Grand Lisboa City of Dreams Galaxy Macau MGM Grand Wynn Macau All Other Casinos Total Est. Avg. # of Slots 1,158 2, , ,468 1,200 1, ,906 16, Reflects 2Q12 results for Sands China properties and Wynn Macau. The results for all other properties presented are from 1Q12 Source: Company filings; sell side analyst models and reports 24

25 China s High Speed Rail Connecting More of Mainland China to Macao Wuhan Guangzhou High Speed Rail Wuhan is the capital of Hubei Province and the most populous city in Central China with ~10 million people Wuhan is a major transportation hub and known as the economic hub of Central China HSR reduces travel time to Guangzhou from 11 hours by bus to 3.5 hours by train One of the most successful routes with trains in each direction each day Guangzhou Zhuhai Intercity Rail Rail line connecting Guangzhou to Zhuhai, where the Gongbei border gate to Macao is located Guangzhou is the largest city in Guangdong province and is a key economic and transportation hub Reduces travel time from Guangzhou to Zhuhai from 1.5 hours by bus to 45 minutes Expected completion in 2012 Future link to Macao Light Rail System Source: Union Gaming, LVS 25

26 Penetration Into Mainland China is Happening Visitation to Macao from Select Provinces Mainland China Visitation to Macao Population Twelve Months Ended June 30, (MM) % Change Beijing , , % Tianjin 12 83, , % Shanghai , , % Zhejiang , , % Fujian , , % Chongqing , , % Hunan , , % Guangdong 95 7,395,566 8,295, % Source: Macao DSEC 26

27 Singapore Market Tourism Enhancements MRT station opened in January 2012 providing mass transit access to Marina Bay Sands MICE (meeting, convention and exhibition), hotel, retail, dining and entertainment offerings Singapore government expects over 500,000 riders per day on the line (Circle Line) New state of the art deep water cruise terminal in Marina Bay opened on June 2, 2012 S$500 million project funded by the Singapore Tourism Board (STB) 1.6 million total cruise passengers projected by STB by 2015 S$1 billion Gardens By the Bay in Marina Bay opened on June 29, 2012 STB expecting 5 million visitors per year to the attraction MRT Station and Additional Tourism Enhancements (Deep Water Cruise Terminal and Gardens by the Bay) to Increase Visitation to Marina Bay Area Source: Singapore Land Transit Authority, Singapore Tourism Board 27

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