LOS ANGELES (BLOOMBERG) - Shares in Las Vegas Sands Corp, the world's largest casino company, rose in extended trading on Monday (July 25) on signs that a two-year slump in betting is easing in the Chinese enclave of Macau.
The company's mass-market gaming revenue in Macau rose in June for the first time in two years, Sands executives said on Monday on a call with investors. The company earlier reported second-quarter sales and profit that missed analysts' estimates amid lower results in Singapore and continued softness in Macau.
Net profit fell 30 per cent to US$328 million (S$446 million), or 41 US cents a share, down from US$469.2 million, or 59 cents a share, a year earlier. Analysts had been expecting 56 cents, the average of 14 estimates compiled by Bloomberg. Revenue fell 9.3 per cent to US$2.65 billion.
In Macau, Sands' earnings before interest, taxes, depreciation and amortisation (Ebitda) fell 14 per cent to US$487.7 million.
Ebidta in Singapore, the company's second-largest market, fell 1.7 per cent to US$357 million as revenue dropped 2.9 per cent.
In Las Vegas, earnings on that basis rose 34 per cent to US$72.5 million.
Sands is the largest casino operator in Macau, the only part of China where gambling is legal. Betting there has been in a two-year slump amid a Chinese government crackdown on corruption that has prompted high rollers to cut back on conspicuous consumption. The market is showing signs of recovery, with the overall drop in betting moderating and visitor traffic on the upswing.
"Something good happened in June," Mr Rob Goldstein, Sands' president, said on the call. "The gaming floors are busy, especially on weekends. Macau is morphing into the world's greatest mass market. Hopefully we'll see it for the rest of the summer."
The emerging turnaround in Macau, the world's biggest gambling centre, is coming at an opportune moment.
Despite the two-year drop in betting, the region is in the midst of a building boom. Wynn Resorts Ltd is scheduled to open its newest resort, the US$4.1 billion Wynn Palace, on Aug 22. Sands, the casino operator founded by billionaire Sheldon Adelson, has its own new resort, the US$2.7 billion Parisian, slated to open on Sept 13.
"We're very happy that there's one month that hit the bottom and we have no reason to believe that that's not going to continue," Mr Adelson said on the call.