While the battle for supremacy in Las Vegas is basically over, with MGM Resorts International and Caesar’s Entertainment dominating the Strip, the fight to win market share in Macau is still too close to call. In just 10 years, the Chinese provincial region has overtaken Las Vegas as the world’s busiest gambling mecca. The American gambling empires and their Chinese partners are currently trying to one-up each other with extravagant, multi-billion dollar resorts in the hopes of attracting the region’s billion potential gamblers. So, which companies have the inside track towards victory?
LVS: Las Vegas Sands Corp. (NYSE:LVS) flirted with bankruptcy five years ago, but has come back strong with the largest American footprint in Macau. The company owns four casinos in the province, including the gargantuan Sands Cotai Central facility that opened in April 2012. Sands has been a prime beneficiary of the growth in Macau gambling revenue, which was up 14% versus the prior year according to industry estimates.
In FY2012, Las Vegas Sands Corp. (NYSE:LVS) reported solid financial results, with annual increase in revenues and adjusted operating income of 35.3% and 25.6%, respectively, in its China operations. The company’s revenue growth benefited from the opening of its latest Macau casino, as well as a small increase in its average daily room rate. Las Vegas Sands Corp. (NYSE:LVS) has also been trying to increase its non-gambling revenue sources, with highly rated food and hospitality venues that are geared to its high-end customer base.
Looking ahead, LVS is raising its bet on Macau, with plans underway for another multi-billion dollar facility, the Parisian, which is scheduled for completion in 2015. It is also trying to win a bigger share of the non-VIP customer base, with its invitation-only Paiza Clubs that provide exclusive restaurants, lounges, and gaming areas. With LVS's strong base of existing Macau casinos, it will be hard to beat.