EXHIBIT 99.1
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S A N D S
LAS VEGAS SANDS CORP. P R E S S R E L E A S E
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LAS VEGAS SANDS CORP. REPORTS
THIRD QUARTER 2007 RESULTS
NEARLY 3.9 MILLION VISITORS EXPERIENCED ASIA'S
FIRST INTEGRATED RESORT IN ITS FIRST 65 DAYS OF OPERATION
ROLLING CHIP VOLUME FOR MACAO PROPERTIES IN TOTAL REACHES RECORD $11.0 BILLION
IN THIRD QUARTER, AND $6.6 BILLION IN MONTH OF OCTOBER
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LAS VEGAS, NV (NOVEMBER 1, 2007)--Las Vegas Sands Corp. (NYSE:LVS), today
reported financial results for the quarter ended September 30, 2007.
COMPANY-WIDE OPERATING RESULTS
Net revenue for the third quarter of 2007 increased 19.5% to a record $661.0
million, compared to $553.2 million in the third quarter of 2006. Consolidated
adjusted property EBITDAR in the third quarter of 2007 came in at $164.3
million, a decrease of 18.9%, compared to $202.6 million in the year-ago
quarter. On a GAAP (Generally Accepted Accounting Principles) basis, operating
loss was $20.8 million versus operating income of $133.5 million in the third
quarter of 2006. The decrease in operating income of $154.3 million was driven
principally by increases of $75.9 million in pre-opening expenses directly
related to our preparations for the opening of The Venetian Macao, which opened
on August 28th, The Palazzo, which will open on December 20th, and other
properties to be opened in the future in Macao, Singapore, and the United
States, increased operating costs as we expand our infrastructure to execute
our global growth plans, lower table games win percentage, and an increase of
$27.6 million in depreciation and amortization expense.
Adjusted net income (excluding loss on disposal of assets, pre-opening expense,
and development expense) was $41.8 million, or adjusted earnings per diluted
share of $0.12, compared to adjusted net income (excluding loss on disposal of
assets, pre-opening expense, and development expense) of $117.6 million, or
adjusted earnings per diluted share of $0.33, in the third quarter of 2006. The
decrease in adjusted net income of $75.7 million was driven principally by the
increased operating costs mentioned above, lower table games win percentage, as
well as pretax increases in depreciation and amortization of $27.6 million and
net interest expense of $21.4 million. On a GAAP basis, net loss in the third
quarter of 2007 was $48.5 million, or $0.14 per diluted share, compared to net
income of $97.3 million, or $0.27 per diluted share, in the third quarter of
2006. The decrease in GAAP net income of $145.8 million was principally driven
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by the increases in pre-opening expenses, operating costs, depreciation and
amortization expense, net interest expense, and the lower table games win
percentage mentioned above.
William P. Weidner, president and COO stated, "On August 28, 2007, Las Vegas
Sands opened Macao's first full-scale integrated resort, The Venetian Macao,
and took our first steps toward realizing our vision of transforming Macao into
Asia's premier business and leisure destination. While we are clearly proud of
the overwhelmingly positive response the public has shown The Venetian Macao,
and the strong performance of each of our gaming, hotel, entertainment, retail
and group meeting businesses, we are clearly only in the top of the first
inning in delivering on the fundamental goal and commitment we share with the
people of Macao, Hong Kong and all of Southern China - - the transformation of
Macao into Asia's premier business and leisure destination. We remain
confident, and The Venetian Macao's operating results confirm, that the
execution of our strategy will deliver tremendous economic benefits to Macao
and the entire region, as well as industry leading returns to our
shareholders."
THIRD QUARTER HIGHLIGHTS
Weidner continued, "As the first Cotai Strip property to open in Macao and
Asia's first integrated resort, The Venetian Macao has received extremely
positive reviews and welcomed millions of guests from around the region. We
were honored to receive tremendous support from all our constituencies
throughout the region, as we welcomed nearly 3.9 million guests in our first 65
days of operation, including over 114,000 guests in our first 24 hours. More
recently, on Saturday October 20th, concurrent with both the 2007 NBA China
Games, which were played in the Arena at The Venetian Macao, and our first two
tradeshows, the Kenfair-sponsored Mega Macao and the Macao Trade and Investment
Promotion Institute sponsored Macau International Trade and Investment Fair, we
welcomed over 104,000 guests to The Venetian Macao, the most since the night of
the opening of the property. Our strong hotel rate and occupancy statistics
clearly reflect the strength of our product offering and the broad interest
from the region in Macao's first integrated destination resort. Our corporate
meeting and convention businesses are also off to a strong start, our
Non-Rolling table drop has increased by 32% in October compared to September,
and volumes in our VIP gaming business have been outstanding and have clearly
exceeded our expectations.
"Back on the Macao Peninsula, the Sands Macao delivered a solid quarter. Our
Rolling Chip volume increased 79.2% to $6.29 billion, compared to $3.51 billion
in the third quarter of 2006, while third quarter visitor volume remained
strong, with 2.34 million visits in the quarter, about the same number as the
2.37 million in the third quarter of 2006. In October, visitor volume at the
Sands totaled 805,000 visitors, compared to 794,000 in October of last year.
"Importantly, the Macao gaming market continues to expand in response to the
addition of high-quality capacity, with gross gaming win increasing by over 50%
in the Macao market overall for the quarter ended September 30, 2007, compared
to the same quarter in 2006. This continuing strong growth in the Macao
marketplace, coupled with the overwhelmingly positive reception the public has
shown The Venetian Macao, provide positive momentum as we expand our tradeshow,
convention, corporate meeting, entertainment and retail offerings and amenities
in the weeks and months ahead. Additionally, our investments in local and
regional transportation infrastructure, on land, in the air and at sea,
together with the infrastructure investments being made by Macao, Hong Kong,
and the wider region, will only serve to increase and broaden visitation, and
improve the overall customer experience of the visitor to Macao. Looking ahead,
we remain extremely confident that the world class product offerings of The
Venetian Macao will allow us, as the market continues to evolve and mature, to
convert our strong visitation, hotel occupancy and retail sales figures into
market and industry leading gaming and non-gaming revenue growth and,
ultimately, superior financial performance.
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Weidner added, "With The Venetian Macao now successfully open, we have
continued to steadily execute our development, marketing and promotional plans
for the Cotai Strip, Macao, Hong Kong and the wider region. Following on the
success of the NBA China Games, which were hosted in The Venetian Macao's
multi-purpose arena and featured the China National team, LeBron James and the
Cleveland Cavaliers, and Dwight Howard and the Orlando Magic, The Venetian
Macao has presented additional regional and international entertainment
performances, including the highly successful performance of Black Eyed Peas
last Saturday night, which was attended by approximately 10,000 of the more
than 80,000 total visitors to the property that day. These world-class
entertainment events have been widely embraced by the region, with strong
ticket sales and attendance at these events driving new, first-time visitors to
Macao. Future entertainment at The Venetian Macao will include a nearly
sold-out performance by Beyonce this Saturday November 3rd, as well as other
world-class entertainment artists, which will be announced shortly. Many global
brands have signed on to sponsor events in the Venetian Arena including Lenovo,
Motorola, Toyota, Gatorade, DHL, and Rolex. On November 24th, The Venetian
Macao will host tennis legends Roger Federer and Pete Sampras, in an historic
match up for which tickets sold out within hours of becoming available. Local,
regional and international media coverage of these world-class events and
performances have provided important marketing for Macao as a true resort
destination, which will deliver ongoing benefits not only to The Venetian Macao
and the Cotai Strip, but also to Macao itself as a destination, as well as Hong
Kong and the wider Southern China region.
"Our retail offering is off to an outstanding start, with many retailers
recording initial sales figures far in excess of expectations, and producing
sales that are on a pace to generate significant percentage-of-retail-sales
rental payments in excess of minimum rents. We opened The Grand Canal Shoppes
in The Venetian Macao with 130 stores on August 28th, and have 150 stores open
at present. Additional stores will open in the weeks ahead, and we expect to
have approximately 270 stores, representing over 600,000 sq.ft., open by year
end. The remaining 60 stores, which are principally in the mezzanine of the
complex, will open in early 2008. We have effectively completed the leasing of
The Shoppes at the Four Seasons Macao, which will be interconnected to The
Grand Canal Shoppes in The Venetian Macao, and plan to open this luxury mall in
summer of 2008. In addition, we have now initiated the leasing process and have
executed definitive agreements with more than 100 retailers at Cotai Central,
the nearly 800,000 square foot mall in the massive podium of the complex
anchored by the Sheraton Macao Cotai, the St. Regis Macao Cotai, the Shangri-La
Macao Cotai and Traders Macao Cotai, which is located directly across the Cotai
Strip from, and will be connected by air-conditioned walkover bridge to, The
Venetian Macao and the Four Seasons Macao Cotai.
"In the last few weeks, our convention, tour and travel, and corporate meetings
businesses have each begun to increase their operation. In the fourth quarter,
The Venetian Macao will host more than 200 corporate meetings and events,
including large corporate events held by some of the most well known and
respected multinationals in the world, as well as seven tradeshows. Looking
into 2008, we expect to host approximately 30 tradeshows covering a wide array
of industry verticals, with Fashion, Jewelry, Gifts, Medical, Tobacco, Travel,
Gaming, General Consumer, Wine and Gourmet Food, Automotive, and even the
Amusement Park industries represented. Included among the shows we expect to
host next year is a Pharmaceutical show sponsored by the China Center for
Pharmaceutical International Exchange, an organization under the supervision of
the Central Government of the People's Republic of China, and an Environmental
Show sponsored by the Macau Trade and Investment Promotion Institute. The
sponsorship of these events by governmental organizations reflect the
endorsement and show of support we are enjoying around the region. We remain
enthusiastic about the ability of this important market segment to drive
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visitation, as well as hotel rate and occupancy, to The Venetian Macao and the
Cotai Strip, Hong Kong, the peninsula of Macao and the wider region, both today
and in the decades ahead.
"Our success in each of our business segments - - Hotel, Retail, Entertainment,
Group Meeting, Convention, and Gaming, provide a fertile ground for us to begin
to orchestrate these elements for maximum utility. As each of these businesses
continues to grow, we expect to tailor our services to increase our total
revenue and maximize our operating income yield from the multiple business and
customer segments we serve. In October, our Non-Rolling chip table games drop
increased by more than 32% compared to September. This positive upward trend in
Non-Rolling chip table games drop at The Venetian Macao is consistent with the
Non-Rolling chip table games drop trends reflected in the early days and weeks
of the Sands Macao, and is an indication that the mass gaming floor of the
property is beginning to mature. We expect the maturation of all the property's
elements to continue over the coming months, and we expect to increasingly
drive revenue and margin from the property as the maturation process for all
our businesses continues in the months and years ahead.
"In addition, our construction, design and development work on each of our
other six sites on the Cotai Strip has continued to progress. We have also
advanced our master-plan to develop a complementary trade-fair, convention, and
leisure destination on Hengqin Island, in Zhuhai of the People's Republic of
China and adjacent to the Cotai Strip.
"In Las Vegas, despite the negative impact of a lower than normal table games
win percentage, The Venetian continued to perform extremely well, delivering
strong growth in every category of casino volume, as well as record third
quarter REVPAR and occupancy.
"Additionally, we are very excited to be preparing to open The Palazzo, our
newest resort on the Las Vegas Strip. We expect this breathtaking 3,066-suite
hotel to set a new standard for luxury and opulence in Las Vegas, and we look
forward to the opening of the property's hotel, gaming and a portion of its
magnificent dining and entertainment amenities on December 20th, only seven
weeks from today." said Weidner.
LAS VEGAS THIRD QUARTER OPERATING RESULTS
Table games drop increased 34.8% to $356.4 million in the third quarter of 2007
versus $264.3 million during the third quarter of 2006. Slot machine handle
(volume) increased 18.8% to $619.8 million in the third quarter of 2007,
compared to $521.5 million during the third quarter of 2006. Table games win
percentage (calculated before discounts) was 14.7% in the third quarter of
2007, compared to 23.4% in the third quarter of last year. This compares to our
expected range of 20% to 22%. Slot win percentage (calculated before discounts)
was 6.2% in the 2007 third quarter, compared to 6.5% in the third quarter last
year. Other casino revenue, including race and sports book as well as poker,
increased 36.4% to $3.0 million, compared to $2.2 million in the third quarter
of 2006. Principally as a result of the significantly lower than prior year
table games win percentages mentioned above, total casino revenues decreased
6.9% to $83.1 million in the third quarter of 2007, compared to $89.3 million a
year ago.
In the third quarter of 2007, hotel revenues increased 3.6% to $83.0 million
versus $80.1 million in the third quarter of 2006, despite having approximately
3.4% fewer rooms available in the third quarter of 2007 compared to the quarter
last year, due to the now completed renovation program of 2,800 suites at The
Venetian. The Venetian Las Vegas' average daily rate (ADR) increased 5.9% to
$234, compared to $221 in the third quarter of 2006. The Venetian's occupancy
of available guestrooms increased to 99.6% during the third quarter of 2007,
which compares to 98.4% during the prior year period, generating revenue per
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available room (REVPAR) of $233 in the 2007 period, an increase of 7.4% versus
$217 in the 2006 period.
Retail and other operating revenues were $19.1 million in the quarter, compared
to $14.7 million in the third quarter last year, an increase of 29.9%. Food and
beverage revenues increased to $33.4 million in the third quarter of 2007,
compared to $32.2 million in the 2006 period.
On a GAAP basis, operating income for our Las Vegas operations decreased 45.8%
to $29.6 million, compared to $54.6 million in the 2006 period. Adjusted
property EBITDAR for The Venetian Las Vegas was $60.2 million, compared to
$75.1 million for the third quarter of 2006. The decreases in operating income
and adjusted property EBITDAR were principally driven by the decrease in table
games win percentage during the quarter compared to the quarter one year ago
mentioned above.
"We continue to see strong performance across the board at The Venetian Las
Vegas," continued Weidner. "Although our quarterly results were negatively
impacted by a lower than normal hold percentage, the benefits of our targeted
capital investments have continued to contribute to growth. Our gaming volumes
were strong, as table games drop increased nearly 35% year over year. Our
convention and corporate meeting-based strategy continues to drive increases in
our room rates and REVPAR, with room revenue increasing 3.6% in the quarter
compared to the same quarter last year, despite a decrease of 3.4% in our
inventory of rooms available for occupancy, due to our now completed remodeling
program at the property. Our ongoing efforts to manage our costs across the
property continue to benefit our adjusted property EBITDAR at the Las Vegas
property, and we expect the opening of The Palazzo later this year to generate
significant operating efficiencies.
"The construction of The Palazzo Resort is nearing completion and when its
doors open on December 20th, it will quickly become Las Vegas' most desirable
destination. With exquisite public spaces featuring a variety of elegant water
features, and lush, rich foliage, The Palazzo will be home to the most
exclusive retail and restaurant offering in Las Vegas" said Weidner.
Anchored by an 85,000 square-foot flagship Barneys New York, The Shoppes at The
Palazzo will be home to several exclusive retailers making their Las Vegas
debuts, including Tory Burch, Christian Louboutin, Diane Von Furstenberg, Van
Cleef & Arpels, Catherine Malandrino, Chloe, Anya Hindmarch, and Michael Kors.
The restaurant offerings will feature a variety of cuisines from a star-studded
collection of chefs, including Mario Batali, Emeril Lagasse, Charlie Trotter
and Wolfgang Puck.
The Palazzo is scheduled to open its gaming, hotel and a selection of its
restaurant and entertainment offerings to the public on December 20th, while
The Shoppes at The Palazzo, featuring Barneys New York and more than 60 luxury
boutiques, will debut in January of 2008.
In addition to the incredible selection of retail and restaurant options, The
Palazzo will also include a 65,000-square-foot Canyon Ranch Spa Club, a Las
Vegas version of the dynamic 40/40 sports bar and lounge, a lavish, 1,800-seat
theatre for JERSEY BOYS, which will open in spring 2008, in addition to some
very exciting entertainment options we will announce soon and plan to open in
early 2008.
The opening of The Shoppes at The Palazzo in January will trigger an initial
payment of more than $500 million from General Growth Properties. Under the
terms of our sales agreement with GGP, we expect to receive more than $250
million in additional proceeds, or more than $750 million in total, over the
thirty month period following the sale.
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Weidner continued, "Upon completion, the comprehensively renovated Venetian Las
Vegas and luxurious Palazzo, together with our Sands convention center, will
comprise the largest integrated resort and convention destination in the world,
with approximately 7,1 all-suite rooms, 2.3 million square feet of meeting,
convention and exhibition space, and world class dining, retail, and
entertainment amenities. We expect to obtain back-of-house and other operating
efficiencies of between $40 million and $60 million for the combined complex
once The Palazzo opens. We believe our Venetian and Palazzo properties will
provide an excellent platform for profitable growth in Las Vegas for years to
come."
SANDS MACAO THIRD QUARTER OPERATING RESULTS
At the Sands Macao, third quarter 2007 Rolling Chip volume increased 79.2% to
$6.29 billion, compared to $3.51 billion in the third quarter of 2006. Third
quarter casino revenues decreased 12.2% to $294.5 million versus $335.6 million
in the 2006 period. The decreased revenues were principally driven by a lower
table games win percentage on Rolling Chip play (2.85% in the 2007 quarter)
compared to the same quarter last year (4.25% in the 2006 quarter), as well as
lower Non-Rolling Chip table games drop. Principally as a result of the factors
described above, the Sands Macao reported adjusted property EBITDAR decreased
to $77.6 million for the third quarter of 2007, compared to $127.4 million in
the third quarter of 2006. In addition, the Sands' adjusted property EBITDAR
reflected an elevated level of expenses associated with the retention bonus
portion of our Rolling Chip program at the Sands Macao of approximately $5
million in the quarter. The elevated expenses related to the junket retention
program were eliminated on August 31st. Principally as a result of the factors
described above, operating income on a GAAP basis for the Sands Macao decreased
to $65.5 million for the third quarter of 2007, compared to $114.0 million in
last year's third quarter.
Table games drop (the Non-Rolling Chip segment) was $0.81 billion in the third
quarter of 2007, compared to $1.04 billion in the third quarter of 2006.
The Sands' third quarter 2007 Non-Rolling Chip table games win percentage
(calculated before discounts and commissions) came in at 18.7% in the third
quarter of 2007, while Rolling Chip table games win percentage (calculated
before discounts and commissions) was 2.85%. These results compare to our
expected Non-Rolling Chip table games win percentage (calculated before
discounts and commissions) of 18% to 20% and Rolling Chip table games win
percentage (calculated before discounts and commissions) of 3.0%.
The Sands' slot handle (volume) for the third quarter of 2007 was $297.9
million, representing a 12.3% increase versus $265.4 million in the third
quarter of 2006.
Weidner stated, "We remain pleased with both our long-term market positioning
and the resilient near term performance at the Sands Macao, in the face of high
quality competitive product, including the Venetian Macao on Cotai. Our VIP
business continues to reflect strong growth and our visitation statistics
remain healthy, both before and since the opening of The Venetian Macao. With
the opening of The Venetian Macao, we now have the ability to significantly
reduce the cost structure at the Sands Macao, as we allocate our human
resources more efficiently across a larger asset and revenue base. On September
28th, we opened our new 238-suite hotel tower, adding an additional competitive
asset, increasingly important suite inventory, to the Sands' product offering.
Our 289 beautiful suites, together with additional meeting rooms, our 650 seat
theatre, and our soon to be opened luxurious and exclusive 25th floor gaming
club, will enable the Sands Macao to offer a best-of-class Macao peninsula
product set, in the Macao peninsula's most convenient location, for years to
come.
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VENETIAN MACAO OPERATING RESULTS
The Venetian Macao was open for 34 days during the third quarter, and welcomed
nearly two million guests from Macao, Hong Kong, the People's Republic of
China, the greater Asian region and around the world during that period.
Through September 30th, the Rolling Chip program at The Venetian Macao
generated $4.7 billion of Rolling Chip volume. Rolling Chip volume was $4.6
billion for the month of October. Casino revenues in the first 34 days of
operation were $131.0 million, while Non-Rolling Chip table games drop was
$228.3 million. Non-Rolling Chip table games drop for the month of October was
$301.9 million.
The Non-Rolling Chip table games win percentage (calculated before discounts
and commissions) was 16.7% in the third quarter of 2007, while Rolling Chip
table games win percentage (calculated before discounts and commissions) was
2.44%. These results compare to our expected Non-Rolling Chip table games win
percentage (calculated before discounts and commissions) of 18% to 20%, and
Rolling Chip table games win percentage (calculated before discounts and
commissions) of 3.0%.
Slot handle (volume) for the 34 days the property was open during the third
quarter of 2007 was $123.2 million. Slot win percentage was 6.6%.
Hotel revenues during the quarter were $12.1 million. The Venetian Macao's
average daily rate (ADR) was $208 while the occupancy per available guest rooms
was 77.5%, generating revenue per available room (REVPAR) of $161. For the
month of October, hotel revenues were $14.8 million, ADR was $206, the
occupancy per available guestroom was 86.6% and REVPAR was $179.
Retail and other operating revenues were $7.1 million in 34 days of operations.
Food and beverage revenues were $3.6 million.
On a GAAP basis, third quarter operating income for The Venetian Macao was $6.8
million. Adjusted property EBITDAR for The Venetian Macao was $26.5 million in
the third quarter of 2007.
"In The Venetian Macao's first 34 days of operation, we experienced strong
visitation and hotel rate and occupancy statistics, promising retail sales
figures, momentum in our corporate and group meetings business, and outstanding
Rolling Chip gaming volumes. We welcomed nearly 2 million people in our first
34 days of operation, and another 1.9 million visitors in the month of October.
Our Rolling Chip volume was $4.73 billion in our first 34 days, followed by
$4.57 billion in the month of October, illustrating the early acceptance and
market power of our market leading investments in VIP gaming facilities and
suite inventory. Non-Rolling Chip table games drop was $257.1 million in our
first 34 days, and grew to $301.9 million in the month of October. Looking
ahead, our ongoing investments in Macao's transportation infrastructure will
continue to drive visitation and improve the customer experience for Macao's
visitors. Earlier this week, on Monday the 28th of October, we received our
formal concession from the Macao authorities to operate a regional ferry
service into Taipa's new Pac-On ferry terminal. We expect our first vessel to
complete its inaugural voyage in the next few weeks, carrying passengers from
Hong Kong's Shun Tak ferry terminal directly to Taipa and the adjacent Cotai
Strip, and opening up Macao's ferry transportation services to real competition
for the first time. Our ongoing investments in Macao's transportation
infrastructure, including expanded ferry services, local and regional busing
programs, and aviation services should not only expand the number of visitors
to Macao and the Cotai Strip, and improve the customer experience of visitors
to the region, but also provide opportunities for important new customers with
high discretionary incomes from around the region to visit the market for the
first time. These new visitors and first time customers will allow us to drive
increases in both gaming and non-gaming revenue and operating income yield per
visitor, from the unprecedented array of business and consumer services
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available at Asia's first integrated destination resort. As we complete the
additional integrated resorts that comprise the Cotai Strip, we expect the
transformation of the market to drive this same phenomenon along the length of
the Cotai Strip in the years ahead."
OTHER FACTORS AFFECTING EARNINGS
Pre-opening expenses related principally to the opening of The Venetian Macao,
as well as the Marina Bay Sands and The Palazzo were $90.4 million in the third
quarter of 2007.
Development expenses related to our efforts in Zhuhai (Hengqin Island, in the
People's Republic of China), Europe, Japan and elsewhere were $3.6 million in
the third quarter of 2007, compared to $6.0 million in the third quarter of
2006.
Interest expense, net of amounts capitalized, was $72.6 million for the third
quarter of 2007, compared to $45.3 million during the third quarter of 2006.
The increase is primarily the result of increased borrowings which support the
company's growth pipeline and current and future development, including
borrowings related to the company's new $5.0 billion credit facility, the $3.3
billion credit facility to support our developments in Macao, as well as
borrowings related to the $1.4 billion credit facility to support the
development of the Marina Bay Sands in Singapore. Capitalized interest was
$64.2 million during the third quarter of 2007, compared to $28.4 million
during the third quarter of 2006.
Stock-based compensation expense was $9.8 million in the third quarter of 2007,
compared to $4.5 million in the third quarter of 2006.
Other income, which is principally composed of foreign currency transaction
gains, was $17.1 million in the third quarter of 2007, compared to an expense
of $0.7 million in the third quarter of 2006.
The effective tax rate for the third quarter of 2007 of 1.9% is lower than the
United States federal statutory rate due principally to a zero effective tax
rate on our Macao gaming income as a result of a temporary income tax exemption
on gaming operations, which is currently set to expire at the end of 2008.
BALANCE SHEET ITEMS
Unrestricted cash balances as of September 30, 2007 stood at $1.68 billion
while restricted cash balances were $262.8 million. Of the restricted cash
balances, $135.5 million is restricted for Macao-related construction and
$113.3 million is restricted for construction of the Marina Bay Sands in
Singapore.
As of September 30, 2007, total debt outstanding, including the current
portion, was $7.29 billion.
CAPITAL EXPENDITURES AND OTHER ACTIVITIES
Capital expenditures during the third quarter of 2007 totaled $1.03 billion.
This includes construction and development activities of $558.9 million in
Macao, $316.5 million at The Palazzo, $90.3 million in Singapore, $42.5 million
at The Venetian and the Sands Expo and Convention Center in Las Vegas, and
$21.8 million for corporate and other activities.
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CONCLUDING COMMENTS
Weidner concluded, "While we are clearly pleased with the positive reception
that the people of Macao, Hong Kong, the People's Republic of China and the
wider Asian region have given The Venetian Macao, we realize that we are only
in the early stages of fulfilling our promise to Macao. The successful opening
of The Venetian Macao is but the initial step in delivering on our commitment
to lead the transformation of Macao into Asia's premier entertainment based
destination resort, and the leading host for tradeshows and conventions in the
region. We have much work ahead of us as we continue to partner with our broad
constituencies in Macao, Hong Kong and the wider region to realize the vision
of transforming Macao into Asia's premier leisure destination.
"Elsewhere, our track record of execution in the development and operation of
convention-based integrated destination resorts clearly positions us well to
continue to execute on our currently announced projects and to develop,
identify and utilize our market-leading position to win additional growth
opportunities worldwide.
"We remain focused on the execution of our plans to develop `Asia's Las Vegas',
a convention and leisure destination with both the scale and the world-class
array of leisure and entertainment amenities necessary to generate extended,
multi-night visitation, on the Cotai Strip. We continue to progress our
construction and development activities on the six additional sites on the
Cotai Strip.
"We remain engaged in continuing extensive collaboration with the Project
Coordination Committee of The Hengqin Venetian International Convention and
Resort Project in Zhuhai as we integrate our development plans with Zhuhai and
Guangdong Province's overall development plans for Hengqin Island.
"In Singapore, we continue to make steady progress on construction and other
development activities of the Marina Bay Sands, which remains on track for an
opening in late 2009. We currently have an average of 2,000 workers on site,
with work progressing on a 24/7 basis. In addition, we have now entered into
agreements with over 100 tenants from around the globe for leases at The
Shoppes at The Marina Bay Sands, and we are pleased to report that the
indicative rents are well north of $200 per square foot per year, reflecting
the strength and vibrancy of that retail market. The Marina Bay Sands will
feature approximately 2,500 hotel rooms, approximately 1.2 million square feet
of flexible meetings, incentive, convention, food and beverage, and exhibition
space, approximately 1.0 million square feet of retail space, three large
entertainment venues, and gaming space which will include our high-end Paiza
ClubTM.
"In Bethlehem, Pennsylvania, we continue to advance our construction activities
on Sands BethworksTM. Utility upgrades and site grading have now been
completed, with construction of the building foundation systems to begin
shortly. The mill order for the structural steel for the casino and retail
buildings has now been placed, with erection of the structures set to begin in
February. The 126-acre integrated destination resort, located on the site of
the former Bethlehem Steel plant, is on the I-78 corridor in eastern
Pennsylvania, with 17.2 million people, including the lucrative northern New
Jersey and New York metropolitan markets, residing within a 75 mile radius. The
property will feature in its first phase a hotel, retail space, 5,000 slot
machines, a multipurpose event center, and a variety of dining and
entertainment options. The resort will also be home to the National Museum of
Industrial History, an arts and cultural center, and the broadcast home of the
local PBS affiliate."
###
9
CONFERENCE CALL INFORMATION
The company will hold a conference call to discuss the company's results on
Thursday, November 1, 2007 at 1:30 p.m. PT (4:30 p.m. ET). Interested parties
are invited to join the call by dialing (800) 659-2056 and using the access
code 73013570. International callers, please dial (617) 614-2714, and use the
same access code. The conference call will also be available through a live
audio webcast at WWW.LASVEGASSANDS.COM (click on Investor Relations). A
telephone replay will be available at (888) 286-8010 and (617) 801-6888, access
code 89865648, from November 1, 2007, at approximately 3:30 p.m. PT (6:30 p.m.
ET) through November 8, 2007.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that are made pursuant
to the Safe Harbor Provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking 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, insurance,
gaming junket operators, risks relating to our Macao gaming concession,
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.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
About Las Vegas Sands Corp.
ABOUT LAS VEGAS SANDS CORP.
Las Vegas Sands Corp. (NYSE: LVS) is one of the leading international
developers of multi-use integrated resorts.
The Las Vegas, Nevada-based company owns and operates The Venetian
Resort-Hotel-Casino and the Sands Expo and Convention Center in Las Vegas, as
well as the Sands Macao and The Venetian Macao in the People's Republic of
China (PRC) Special Administrative Region of Macao. The company is currently
constructing four additional integrated resorts: The Palazzo
Resort-Hotel-Casino in Las Vegas; Sands Bethworks(TM) in Bethlehem,
Pennsylvania; The Marina Bay Sands(TM) in Singapore; and The Four Seasons Macao
in the People's Republic of China (PRC) Special Administrative Region on Macao.
LVS is also creating the Cotai Strip(TM), a master-planned development
of resort-casino properties in Macao. Additionally, the company is working with
the Zhuhai Municipal People's Government of the PRC to master-plan the
development of a leisure resort and convention complex on Hengqin Island in the
PRC.
CONTACTS:
Investment Community: Scott Henry (702) 733-5502
Media: Ron Reese (702) 414-3607
LAS VEGAS SANDS
THIRD QUARTER 2007 RESULTS
- -------------------------------------------------------------------------------
10
NON-GAAP RECONCILIATIONS
- -------------------------------------------------------------------------------
Within the company's third quarter 2007 press release, the company makes
reference to certain non-GAAP financial measures including "adjusted net
income", "adjusted earnings per diluted share", "adjusted EBITDA", and
"adjusted property EBITDAR". Whenever such information is presented, the
company has complied with the provisions of the rules under Regulation G and
Item 2.02 of Form 8-K. The specific reasons why the company's management
believes that the presentation of each of these non-GAAP financial measures
provides useful information to investors regarding Las Vegas Sands Corp.'s
financial condition, results of operations and cash flows has been provided in
the Form 8-K filed in connection with this press release.
- -------------------------------------------------------------------------------
Adjusted net income and adjusted earnings per diluted share in the third
quarter of 2007 and 2006 exclude loss on disposal of assets, pre-opening
expense, and development expense. Reconciliations of GAAP net income (loss) and
GAAP earnings (loss) per diluted share to adjusted net income and adjusted
earnings per diluted share are included in the financial schedules accompanying
this release.
Adjusted EBITDA consists of operating income (loss) before depreciation and
amortization, loss on disposal of assets, pre-opening expense, development
expense, and stock-based compensation. Adjusted property EBITDAR consists of
operating income (loss) before depreciation and amortization, loss on disposal
of assets, pre-opening expense, development expense, stock-based compensation,
corporate expense, and rental expense. Reconciliations of GAAP operating income
(loss) and GAAP net income (loss) to adjusted EBITDA and adjusted property
EBITDAR are included in the financial schedules accompanying this release.
11
Las Vegas Sands Corp. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
-------------- -------------- -------------- --------------
Revenues:
Casino $ 508,522 $ 424,986 $ 1,433,135 $ 1,178,830
Rooms 96,718 81,651 289,588 262,443
Food and beverage 50,032 42,394 162,129 138,233
Retail 3,511 3,478 9,000 9,634
Other 35,547 26,430 104,397 84,555
------------ ------------ ------------ ------------
694,330 578,939 1,998,249 1,673,695
Less - Promotional allowances (33,380) (25,711) (96,155) (73,096)
------------ ------------ ------------ ------------
660,950 553,228 1,902,094 1,600,599
------------ ------------ ------------ ------------
Operating Costs and Expenses:
Casino-Hotel operations 501,500 353,035 1,333,612 1,018,824
Rental expense 8,136 3,383 23,141 10,893
Corporate expense 23,444 15,654 66,657 40,859
Pre-opening expense 90,447 14,584 153,224 21,157
Development expense 3,621 5,968 7,227 22,997
Depreciation and amortization 54,309 26,743 121,262 76,176
Loss on disposal of assets 287 383 526 1,920
------------ ------------ ------------ ------------
681,744 419,750 1,705,649 1,192,826
------------ ------------ ------------ ------------
Operating income (loss) (20,794) 133,478 196,445 407,773
Interest income 26,890 21,029 60,906 46,261
Interest expense, net of amounts capitalized (72,607) (45,343) (161,628) (90,443)
Other income (expense) 17,052 (680) 7,715 (530)
Loss on early retirement of debt - - (10,705) -
------------ ------------ ------------ ------------
Income (loss) before income taxes (49,459) 108,484 92,733 363,061
Benefit (provision) for income taxes 952 (11,233) (15,928) (34,698)
------------ ------------ ------------ ------------
Net income (loss) $ (48,507) $ 97,251 $ 76,805 $ 328,363
============ ============ ============ ============
Basic earnings (loss) per share $ (0.14) $ 0.27 $ 0.22 $ 0.93
Diluted earnings (loss) per share $ (0.14) $ 0.27 $ 0.22 $ 0.92
Weighted average shares outstanding
Basic 354,856,121 354,296,742 354,716,730 354,250,901
Diluted 354,856,121 355,220,167 357,094,808 355,006,634
Las Vegas Sands Corp. and Subsidiaries
Non-GAAP Measure-Adjusted Net Income and Earnings Per Share
(In thousands, except share and per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
-------------- -------------- -------------- --------------
Net income (loss) $ (48,507) $ 97,251 $ 76,805 $ 328,363
Loss on disposal of assets, net 298 383 471 1,916
Pre-opening expense, net 87,363 14,433 148,329 20,856
Development expense, net 2,678 5,486 5,744 21,326
Stock offering costs, net - - - 1,327
Loss on early retirement of debt, net - - 6,958 -
------------ ------------ ------------ ------------
Adjusted net income $ 41,832 $ 117,553 $ 238,307 $ 373,788
============ ============ ============ ============
Per diluted share of common stock:
Net income (loss) $ (0.14) $ 0.27 $ 0.22 $ 0.92
Loss on disposal of assets, net - - - 0.01
Pre-opening expense, net 0.25 0.04 0.41 0.06
Development expense, net 0.01 0.02 0.02 0.06
Stock offering costs, net - - - -
Loss on early retirement of debt, net - - 0.02 -
------------ ------------ ------------ ------------
Adjusted earnings per diluted share $ 0.12 $ 0.33 $ 0.67 $ 1.05
============ ============ ============ ============
Weighted average diluted shares outstanding 356,213,975 355,220,167 357,094,808 355,006,634
- -----------------------
Las Vegas Sands Corp. and Subsidiaries
Supplemental Data - Net Revenues by Resort
(In thousands)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
-------------- -------------- -------------- --------------
The Venetian $ 212,103 $ 214,042 $ 725,459 $ 669,344
Sands Macao 298,756 339,186 1,026,544 931,255
The Venetian Macao 150,091 - 150,091 -
------------ ------------ ------------ ------------
$ 660,950 $ 553,228 $ 1,902,094 $ 1,600,599
============ ============ ============ ============
Las Vegas Sands Corp. and Subsidiaries
Non-GAAP Measure
(In thousands)
(Unaudited)
The following are reconciliations of Operating Income to Adjusted EBITDA and Adjusted Property EBITDAR
Three Months Ended September 30, 2007
(Gain)
Depreciation Loss on (1) Adjusted
Operating and Disposal Pre-Opening Development Stock-Based Adjusted Corporate Rental Property
Income(Loss) Amortization of Assets Expense Expense Compensation EBITDA Expense Expense EBITDAR
------------ ------------ --------- ----------- ---------- ------------ -------- --------- ------- ---------
The Venetian $ 29,595 $ 23,861 $ (32) $ 1,554 $ - $ 3,323 $ 58,301 $ - $ 1,882 $ 60,183
Sands Macao 65,456 9,959 319 464 - 1,121 77,319 - 255 77,574
The Venetian Macao 6,831 16,737 - - - 383 23,951 - 2,569 26,520
Other development(2) (97,337) 1,857 - 88,429 3,621 - (3,430) - 3,430 -
Corporate (25,339) 1,895 - - - - (23,444) 23,444 - -
--------- --------- ------- -------- -------- --------- --------- -------- -------- ---------
$ (20,794) $ 54,309 $ 287 $ 90,447 $ 3,621 $ 4,827 $ 132,697 $ 23,444 $ 8,136 $ 164,277
========= ========= ======= ======== ======== ========= ========= ======== ======= =========
Three Months Ended September 30, 2006
Depreciation Loss on (1) Adjusted
Operating and Disposal Pre-Opening Development Stock-Based Adjusted Corporate Rental Property
Income(Loss) Amortization of Assets Expense Expense Compensation EBITDA Expense Expense EBITDAR
------------ ------------ --------- ----------- ---------- ------------ -------- --------- ------- ---------
The Venetian $ 54,560 $ 15,087 $ - $ 681 $ (38) $ 1,793 $ 72,083 $ - $ 3,046 $ 75,129
Sands Macao 114,049 8,773 383 3,315 - 574 127,094 - 337 127,431
Other development(2) (18,915) 2,321 - 10,588 6,006 - - - - -
Corporate (16,216) 562 - - - - (15,654) 15,654 - -
--------- --------- ------- -------- -------- --------- --------- -------- -------- ---------
$ 133,478 $ 26,743 $ 383 $ 14,584 $ 5,968 $ 2,367 $ 183,523 $ 15,654 $ 3,383 $ 202,560
========= ========= ======= ======== ======== ========= ========= ======== ======= =========
Nine Months Ended September 30, 2007
Depreciation Loss on (1) Adjusted
Operating and Disposal Pre-Opening Development Stock-Based Adjusted Corporate Rental Property
Income(Loss) Amortization of Assets Expense Expense Compensation EBITDA Expense Expense EBITDAR
------------ ------------ --------- ----------- ---------- ------------ -------- --------- ------- ---------
The Venetian $ 176,931 $ 63,163 $ 158 $ 2,065 $ - $ 7,030 $ 249,347 $ - $ 6,159 $ 255,506
Sands Macao 260,768 31,404 367 464 - 2,594 295,597 - 866 296,463
The Venetian Macao 6,831 16,737 - - - 383 23,951 - 2,569 26,520
Other development(2) (176,933) 5,463 1 150,695 7,227 - (13,547) - 13,547 -
Corporate (71,152) 4,495 - - - - (66,657) 66,657 - -
--------- --------- ------- -------- -------- --------- --------- -------- -------- ---------
$ 196,445 $ 121,262 $ 526 $153,224 $ 7,227 $ 10,007 $ 488,691 $ 66,657 $ 23,141 $ 578,489
========= ========= ======= ======== ======== ========= ========= ======== ======== =========
Nine Months Ended September 30, 2006
Depreciation Loss on (1) Adjusted
Operating and Disposal Pre-Opening Development Stock-Based Adjusted Corporate Rental Property
Income(Loss) Amortization of Assets Expense Expense Compensation EBITDA Expense Expense EBITDAR
------------ ------------ --------- ----------- ---------- ------------ -------- --------- ------- ---------
The Venetian $ 178,132 $ 46,142 $ 12 $ 1,108 $ - $ 3,677 $ 229,071 $ - $ 10,316 $ 239,387
Sands Macao 313,557 24,430 1,908 5,593 - 1,720 347,208 - 577 347,785
Other development(2) (41,448) 3,995 - 14,456 22,997 - - - - -
Corporate (42,468) 1,609 - - - - (40,859) 40,859 - -
--------- --------- ------- -------- -------- --------- --------- -------- -------- ---------
$ 407,773 $ 76,176 $ 1,920 $ 21,157 $ 22,997 $ 5,397 $ 535,420 $ 40,859 $ 10,893 $ 587,172
========= ========= ======= ======== ======== ========= ========= ======== ======== =========
(1) The Company recorded $9.8 million and $4.5 million of stock-based
compensation expense during the three months ended September 30, 2007 and
2006, respectively, of which $3.3 million and $1.8 million, respectively, is
included in corporate expense and $1.7 million and $0.3 million,
respectively, is included in pre-opening and development expense on our
condensed statement of operations. During the nine months ended September
30, 2007 and 2006, the Company recorded stock-based compensation expense of
$22.8 million and $10.2 million, respectively, of which $8.1 million and
$3.9 million, respectively, is included in corporate expense and $4.7
million and $0.9 million, respectively, is included in pre-opening and
development expense on our condensed statement of operations.
(2) Included in pre-opening expense for the three months ended September 30,
2007 and 2006 is $75.2 million and $7.1 million, respectively, related to
The Venetian Macao. Included in pre-opening expense for the nine months
ended September 30, 2007 and 2006 is $121.2 million and $11.8 million,
respectively, related to The Venetian Macao.
Note: The prior period presentation has been revised to conform to the current
period presentation.
Las Vegas Sands Corp. and Subsidiaries
Non-GAAP Measure
(In thousands)
(Unaudited)
The following is a reconciliation of Net Income to Adjusted EBITDA and Adjusted
Property EBITDAR:
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
------------- ------------ ------------- -----------
Net income (loss) $ (48,507) $ 97,251 $ 76,805 $ 328,363
Add (deduct) :
Benefit (provision) for income taxes (952) 11,233 15,928 34,698
Other (income) expense (17,052) 680 (7,715) 530
Interest income (26,890) (21,029) (60,906) (46,261)
Interest expense, net of amounts capitalized 72,607 45,343 161,628 90,443
Loss on early retirement of debt - - 10,705 -
Depreciation and amortization 54,309 26,743 121,262 76,176
Loss on disposal of assets 287 383 526 1,920
Pre-opening expense 90,447 14,584 153,224 21,157
Development expense 3,621 5,968 7,227 22,997
Stock-based compensation (1) 4,827 2,367 10,007 5,397
----------- ---------- ----------- ---------
Adjusted EBITDA 132,697 183,523 488,691 535,420
Add :
Rental expense 8,136 3,383 23,141 10,893
Corporate expense 23,444 15,654 66,657 40,859
----------- ---------- ----------- ---------
Adjusted Property EBITDAR $ 164,277 $ 202,560 $ 578,489 $ 587,172
=========== ========== ========== =========
- --------------------
(1) From prior page
Las Vegas Sands Corp. and Subsidiaries
Supplemental Data Schedule
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
---------- ---------- ---------- ----------
Room Statistics:
The Venetian:
Occupancy % 99.6% 98.4% 99.7% 99.3%
Average daily room rate (ADR) (1) $ 234 $ 221 $ 259 $ 237
Revenue per available room (REVPAR) (2) $ 233 $ 217 $ 258 $ 236
The Venetian Macao:
Occupancy % 77.5% 77.5%
Average daily room rate (ADR) (1) $ 208 $ 208
Revenue per available room (REVPAR) (2) $ 161 $ 161
Other Information:
The Venetian:
Table games win per unit per day (3) $ 4,362 $ 5,008 $ 5,810 $ 5,138
Slot machine win per unit per day (4) $ 248 $ 215 $ 236 $ 211
Average number of table games 131 134 133 133
Average number of slot machines 1,684 1,727 1,683 1,741
Sands Macao:
Table games win per unit per day (3) $ 5,846 $ 6,420 $ 5,791 $ 7,128
Slot machine win per unit per day (4) $ 149 $ 245 $ 153 $ 243
Average number of table games 615 581 715 490
Average number of slot machines 1,430 934 1,513 912
The Venetian Macao:
Table games win per unit per day (3) $ 5,298 $ 5,298
Slot machine win per unit per day (4) $ 72 $ 72
Average number of table games 878 878
Average number of slot machines 3,318 3,318
- ----------------------------
(1) ADR is Average Daily Rate and is calculated by dividing total room revenue
by total rooms occupied.
(2) REVPAR is defined as Revenue Per Available Room and is calculated by
dividing total room revenue by rooms available.
(3) Table games win per unit per day is shown before discounts and commissions.
(4) Slot machine win per unit per day is shown before deducting cost for slot
points.