MBS posts bumper quarterly numbers

Marina Bay Sands benefits from being able to draw customers from a wide market, and is not reliant on Macau-style junkets for VIP turnover, said an analyst.
Marina Bay Sands benefits from being able to draw customers from a wide market, and is not reliant on Macau-style junkets for VIP turnover, said an analyst.ST PHOTO: KUA CHEE SIONG
Marina Bay Sands benefits from being able to draw customers from a wide market, and is not reliant on Macau-style junkets for VIP turnover, said an analyst.
Marina Bay Sands benefits from being able to draw customers from a wide market, and is not reliant on Macau-style junkets for VIP turnover, said an analyst. ST PHOTO: KUA CHEE SIONG

Adelson claims to have 65% of local market as casino revenues rise 2% to US$585 million

Jubilant casino boss Sheldon Adelson said Marina Bay Sands "owns about 65 per cent of the market" here after the resort posted bumper result numbers.

Mr Adelson, Las Vegas Sands' CEO, noted that while the challenging operating environment in Macau hit Las Vegas Sands' overall earnings in the third quarter, Marina Bay Sands was an exception.

He also took aim at local rival Genting Singapore, which operates Resorts World Sentosa.

"I think the discouragement or pessimism about Singapore is based upon how our competitor in Singapore is doing. Can you imagine we're doing double the total amount of business? We own 65 per cent of the market," he added.

"We have never operated in anything but a competitive market, so we understand how to compete a lot stronger than our competitor knows how to compete."

PART OF THE PLAN

That strong performance was principally driven by the successful execution of our strategy to bring premium mass customers from throughout Asia to Singapore.

MR SHELDON ADELSON (above), Las Vegas Sands CEO, on the casino's rising revenues

The Singapore resort's Ebitda - a measure of profit before tax, interest and other items - jumped 10.8 per cent to US$389.7 million (S$543 million) from a year earlier. Turnover gained 2.1 per cent to US$750.7 million for the three months to Sept 30.

"Our share of Ebitda of the duopoly market has increased to 65 per cent in the first six months of 2015, up from 59 per cent in 2014," Mr Adelson told analysts in an earnings call.

The resort's casino revenues rose 2 per cent to US$584.9 million in the quarter. "That strong performance was principally driven by the successful execution of our strategy to bring premium mass customers from throughout Asia to Singapore," Mr Adelson said.

Other divisions were less prosperous: Hotel room revenue dipped 2.9 per cent to US$98.7 million, mall turnover slipped 7.4 per cent to US$41.5 million, and convention, retail and other revenues dipped 2.1 per cent to US$23.4 million, but food and beverage sales rose 6.7 per cent to US$51.1 million.

  • AT A GLANCE

  • REVENUE

    US$750.7 million (+2.1%)


    EBITDA

    US$389.7 million (+10.8%)


    DIVIDEND

    n/a

Union Gaming analyst Christopher Jones said the buoyant gambling numbers were significant, given the challenges facing Asian gaming markets.

He told The Straits Times that Marina Bay Sands is not reliant on Macau-style junkets for VIP turnover, instead drawing its business from a much wider catchment.

"They have a very global book of gaming business. They have a regional (meetings and conferences) business and are top of mind for leisure customers. They also benefit from not having large portions of their room base taken up by Universal Studios," he added.

Mr Rob Goldstein, Las Vegas Sands' executive vice-president and president of global gaming operations, said Marina Bay Sands benefits from being able to draw customers from Malaysia, Indonesia, South Korea and Japan.

"There's a lot of scepticism around Singapore but it's not China-dependent," he said.

"We do get some Chinese play, but again the regional aspect of the customer segment is very strong and growing. We're finding more $20,000, $30,000, $40,000 gaming customers out of those neighbouring countries. "

Meanwhile, parent firm Las Vegas Sands reported a net profit of US$519.4 million, down 22.7 per cent from US$671.7 million a year earlier.

Revenue fell 18.1 per cent to US$2.89 billion.

A version of this article appeared in the print edition of The Straits Times on October 23, 2015, with the headline 'MBS posts bumper quarterly numbers'. Print Edition | Subscribe