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Las Vegas Sands Reports Third Quarter 2012 Results

LAS VEGAS, NV--(Marketwire - Nov 1, 2012) - Las Vegas Sands Corp. ( NYSE : LVS ) today reported financial results for the quarter ended September 30, 2012.

Third Quarter Overview

Mr. Sheldon G. Adelson, chairman and chief executive officer, said, "Despite low hold on table games play at Marina Bay Sands in Singapore, our financial results reflect strong revenue growth and cash flow for the quarter. 

"In Macao, we delivered record financial results, with outstanding growth and strong operating momentum reflected in every segment of our business. We also made strong progress on the execution of our Cotai Strip development plan, as we successfully opened the second phase of Sands Cotai Central, the largest Integrated Resort development in the company's history and a key component of our Cotai Strip master plan. We expect the attractions and offerings of Sands Cotai Central, and in particular its vast inventory of hotel rooms and suites, to meaningfully benefit Macao and the Cotai Strip as it strengthens its position as one of the leading business and leisure destinations in the world. Looking ahead, we remain confident that our soon to be interconnected Cotai Strip properties, The Venetian Macao, Four Seasons Macao and Plaza Casino, and Sands Cotai Central, with 28 million square feet of Integrated Resort capacity, will provide an outstanding platform for growth in Macao in the years ahead.

"The prudent management of our cash flow, including the ability to both invest in future growth and to increase the return of capital to our shareholders, remains a high priority for the company. The board of directors of Las Vegas Sands is pleased to increase the quarterly dividend by 40% to $0.35 per common share, or $1.40 per common share per year, beginning in the first quarter of 2013. The company also declared its fourth consecutive quarterly dividend of $0.25 per common share to be paid on December 28, 2012 to shareholders of record as of December 20, 2012."

Company-Wide Operating Results

Net revenue for the third quarter of 2012 was $2.71 billion, an increase of 12.5% compared to $2.41 billion in the third quarter of 2011. Consolidated adjusted property EBITDA in the third quarter of 2012 was $876.9 million, a decrease of 5.1% compared to $924.1 million in the year-ago quarter. On a hold-adjusted basis, adjusted property EBITDA was $950.7 million. Consolidated adjusted property EBITDA margin decreased to 32.4% in the third quarter of 2012, compared to 38.4% in the third quarter of 2011. The quarter's adjusted property EBITDA and EBITDA margin were unfavorably impacted compared to the quarter one year ago due to lower hold (approximately $74 million adjusted property EBITDA impact) and increased provisions for accounts receivable (approximately $15 million in adjusted property EBITDA impact) in Singapore.

On a GAAP (Generally Accepted Accounting Principles) basis, operating income in the third quarter of 2012 decreased 15.6% to $534.1 million, compared to $632.6 million in the third quarter of 2011. The decrease in operating income was principally due to the previously mentioned reasons as well as pre-opening expenses and higher depreciation and amortization related to the opening of Sands Cotai Central.

Adjusted net income (see Note 1) decreased to $382.2 million, or $0.46 per diluted share, compared to $444.8 million, or $0.55 per diluted share, in the third quarter of 2011. The decrease in adjusted net income was principally driven by the decrease in operating income described above.

On a GAAP basis, net income attributable to common stockholders in the third quarter of 2012 decreased 1.1% to $349.8 million, compared to $353.6 million in the third quarter of 2011, while diluted earnings per share in the third quarter of 2012 decreased 4.5% to $0.42, compared to $0.44 in the prior year quarter. The decrease in net income attributable to common stockholders reflected the decrease in operating income described above, partially offset by the benefit from the discontinuation of preferred stock dividends and the accretion of preferred stock resulting from the redemption of the company's outstanding preferred stock in November 2011. 

Sands China Ltd. Consolidated Financial Results

On a GAAP basis, total net revenues for Sands China Ltd. increased 36.7% to $1.64 billion in the third quarter of 2012, compared to $1.20 billion in the third quarter of 2011. Adjusted property EBITDA for Sands China Ltd. increased 24.3% to $485.6 million in the third quarter of 2012, compared to $390.6 million in the third quarter of 2011. Net income for Sands China Ltd. increased 17.4% to $326.7 million in the third quarter of 2012, compared to $278.3 million in the third quarter of 2011.

The Venetian Macao Third Quarter Operating Results

The Venetian Macao continued to enjoy strong visitation and financial performance. The property delivered a record adjusted property EBITDA of $299.0 million, an increase of 18.3% compared to $252.7 million in the third quarter of 2011. Operating results were positively impacted by higher than expected Rolling Chip win percentage of 3.32%, compared to 2.66% in the third quarter of 2011. Adjusted property EBITDA margin increased to 38.7% in the third quarter of 2012 from 36.7% in the year-ago quarter. Non-Rolling Chip drop was $1.14 billion for the quarter, an increase of 6.2% compared to the same quarter one year ago, while Non-Rolling Chip win percentage increased to 31.3%. Rolling Chip volume during the quarter decreased 11.9% to $11.20 billion partially due to Paiza Club renovations, which resulted in 23 fewer active rolling tables on average during the quarter. Slot handle was $1.26 billion, an increase of 40.8% compared to the quarter one year ago. Mall revenues increased 17.5% during the quarter compared to the quarter last year.

The following table summarizes the key operating results for The Venetian Macao for the third quarter of 2012 compared to the third quarter of 2011:

             
The Venetian Macao Operations   Three Months Ended
September 30,
       
(Dollars in millions)   2012     2011     $ Change     Change  
Revenues:                              
  Casino   $ 671.1     $ 586.9     $ 84.2     14.3 %
  Rooms     55.4       57.1       (1.7 )   -3.0 %
  Food and Beverage     21.0       18.8       2.2     11.7 %
  Mall     36.9       31.4       5.5     17.5 %
  Convention, Retail and Other     19.0       21.7       (2.7 )   -12.4 %
  Less - Promotional Allowances     (30.6 )     (26.7 )     (3.9 )   -14.6 %
Net Revenues   $ 772.8     $ 689.2     $ 83.6     12.1 %
                               
Adjusted Property EBITDA   $ 299.0     $ 252.7     $ 46.3     18.3 %
    EBITDA Margin %     38.7 %     36.7 %           2.0 pts  
                               
Operating Income   $ 261.3     $ 206.5     $ 54.8     26.5 %
                               
Gaming Statistics                              
(Dollars in millions)                              
                               
Rolling Chip Volume   $ 11,199.4     $ 12,706.8     $ (1,507.4 )   -11.9 %
  Rolling Chip Win %(1)     3.32 %     2.66 %           0.66 pts  
                               
Non-Rolling Chip Drop   $ 1,140.9     $ 1,074.2     $ 66.7     6.2 %
  Non-Rolling Chip Win %(2)     31.3 %     27.6 %           3.7 pts  
                               
Slot Handle   $ 1,262.8     $ 897.1     $ 365.7     40.8 %
  Slot Hold %(3)     4.9 %     6.4 %           -1.5 pts  
                               
Hotel Statistics                              
                               
Occupancy %     93.9 %     94.1 %           -0.2 pts  
Average Daily Rate (ADR)   $ 227     $ 232     $ (5 )   -2.2 %
Revenue per Available Room (RevPAR)   $ 213     $ 218     $ (5 )   -2.3 %
                               

(1) This compares to our Macao Operations trailing 12 month Rolling Chip win percentage of 2.88% (calculated before discounts and commissions).
(2) This compares to The Venetian Macao's trailing 12 month Non-Rolling Chip win percentage of 30.2% (calculated before discounts).
(3) This compares to The Venetian Macao's trailing 12 month slot hold percentage of 5.4% (calculated before slot club cash incentives).

Four Seasons Hotel Macao and Plaza Casino Third Quarter Operating Results

The Four Seasons Hotel Macao and Plaza Casino generated adjusted property EBITDA of $54.4 million in the third quarter of 2012, a decrease of 8.9% compared to the $59.7 million for the third quarter of 2011. The operating results were negatively impacted by lower than expected Rolling Chip win percentage of 2.58% for the current quarter. Rolling Chip volume reached $8.96 billion for the quarter, an increase of 115.4% compared to the third quarter of 2011. Non-Rolling Chip drop was a record $110.8 million while Non-Rolling Chip win percentage was 32.6% and lower than the 38.9% in the prior year quarter. Slot handle was $214.8 million during the quarter, an increase of 6.6% compared to the third quarter of 2011. The non-gaming offerings of the property continued to exhibit healthy growth, with increases in both occupancy and ADR driving a RevPAR increase of 22.4% in the quarter. Mall revenue increased 10.0% to $23.1 million. 

The following table summarizes our key operating results for the Four Seasons Hotel Macao and Plaza Casino for the third quarter of 2012 compared to the third quarter of 2011:

             
Four Seasons Hotel Macao and Plaza Casino Operations   Three Months Ended
September 30,
       
(Dollars in millions)   2012     2011     $ Change     Change  
Revenues:                              
  Casino   $ 194.7     $ 140.6     $ 54.1     38.5 %
  Rooms     10.0       8.3       1.7     20.5 %
  Food and Beverage     6.1       5.2       0.9     17.3 %
  Mall     23.1       21.0       2.1     10.0 %
  Convention, Retail and Other     0.7       0.6       0.1     16.7 %
  Less - Promotional Allowances     (10.1 )     (6.6 )     (3.5 )   -53.0 %
Net Revenues   $ 224.5     $ 169.1     $ 55.4     32.8 %
                               
Adjusted Property EBITDA   $ 54.4     $ 59.7     $ (5.3 )   -8.9 %
  EBITDA Margin %     24.2 %     35.3 %           -11.1 pts  
                               
Operating Income   $ 40.3     $ 45.1     $ (4.8 )   -10.6 %
                               
Gaming Statistics                              
(Dollars in millions)                              
                               
Rolling Chip Volume   $ 8,962.5     $ 4,160.5     $ 4,802.0     115.4 %
  Rolling Chip Win %(1)     2.58 %     2.90 %           -0.32 pts  
                               
Non-Rolling Chip Drop   $ 110.8     $ 107.6     $ 3.2     3.0 %
  Non-Rolling Chip Win %(2)     32.6 %     38.9 %           -6.3 pts  
                               
Slot Handle   $ 214.8     $ 201.5     $ 13.3     6.6 %
  Slot Hold %(3)     4.4 %     6.4 %           -2.0 pts  
                               
Hotel Statistics                              
                               
Occupancy %     83.1 %     70.8 %           12.3 pts  
Average Daily Rate (ADR)   $ 349     $ 335     $ 14     4.2 %
Revenue per Available Room (RevPAR)   $ 290     $ 237     $ 53     22.4 %
                               

(1) This compares to our Macao Operations trailing 12 month Rolling Chip win percentage of 2.88% (calculated before discounts and commissions).
(2) This compares to the Plaza Casino's trailing 12 month Non-Rolling Chip win percentage of 40.4% (calculated before discounts).
(3) This compares to the Plaza Casino's trailing 12 month slot hold percentage of 5.1% (calculated before slot club cash incentives).

Sands Cotai Central Third Quarter Operating Results

The first phase of Sands Cotai Central opened on April 11, 2012 and the second phase of the property opened on September 20, 2012, adding additional mass gaming capacity, approximately 1,800 Sheraton-branded hotel rooms and additional retail amenities to the property for the last eleven days of the quarter. Net revenues and adjusted property EBITDA for the third quarter of 2012 were $295.9 million and $53.7 million, respectively, resulting in an EBITDA margin of 18.1%. The quarter's results were negatively impacted by lower than expected Rolling Chip win percentage of 2.28%.

Rolling Chip volume reflected meaningful growth and reached $9.06 billion while Non-Rolling Chip drop reached $542.0 million with Non-Rolling Chip win percentage of 20.7%. Slot handle, driven by robust electronic table games play, was $1.03 billion for the quarter. Rolling Volume per table per day expanded to reach approximately $660,000 in the quarter, an increase of 13.8% compared to the second quarter of 2012. Mass table, slot and ETG win per day climbed to $1.56 million, an increase of 15.0% compared to the second quarter of 2012. Hotel occupancy reached 88.9% during the quarter with ADR of $149.

The following table summarizes our key operating results for Sands Cotai Central for the third quarter of 2012 and the 81 days of operations in the second quarter of 2012:

             
Sands Cotai Central   Quarter Ended
September 30,
    81 Days Ended
June 30,
 
(Dollars in millions)   2012(1)     2012  
                 
Revenues:                
  Casino   $ 272.1     $ 249.5  
  Rooms     24.0       15.3  
  Food and Beverage     11.3       9.4  
  Mall     3.8       3.3  
  Convention, Retail and Other     2.4       1.7  
  Less - Promotional Allowances     (17.7 )     (13.6 )
Net Revenues   $ 295.9     $ 265.6  
                 
Adjusted Property EBITDA   $ 53.7     $ 51.8  
  EBITDA Margin %     18.1 %     19.5 %
                 
Operating Loss   $ (19.9 )   $ (17.9 )
                 
Gaming Statistics                
(Dollars in millions)                
                 
Rolling Chip Volume   $ 9,055.2     $ 6,820.6  
  Rolling Chip Win %     2.28 %     3.12 %
                 
Non-Rolling Chip Drop   $ 542.0     $ 389.4  
  Non-Rolling Chip Win %     20.7 %     21.5 %
                 
Slot Handle   $ 1,032.4     $ 665.4  
  Slot Hold %     3.1 %     4.0 %
                 
Hotel Statistics                
                 
  Occupancy %     88.9 %     75.1 %
  Average Daily Rate (ADR)   $ 149     $ 141  
  Revenue per Available Room (RevPAR)   $ 132     $ 106  
                 

(1) On September 20, 2012, the second phase of Sands Cotai Central opened adding additional mass gaming capacity, approximately 1,800 Sheraton-branded hotel rooms and additional retail amenities.

Sands Macao Third Quarter Operating Results

Sands Macao's adjusted property EBITDA was $80.9 million, an increase of 6.7% compared to last year, while adjusted property EBITDA margin increased 90 basis points to 25.6%. Rolling Chip volume of $6.82 billion for the quarter, which was a decrease of 13.7% compared to the prior year's quarter, reflected a 19.6% decrease in the number of Rolling Chip tables to an average of 115 tables for the quarter. Non-Rolling Chip drop was $739.0 million during the quarter, an increase of 2.3%, despite 72 fewer Non-Rolling chip tables in operation during the quarter. Slot handle increased 11.1% to $596.3 million.

The following table summarizes our key operating results for the Sands Macao for the third quarter of 2012 compared to the third quarter of 2011:

             
Sands Macao Operations   Three Months Ended
September 30,
       
(Dollars in millions)   2012     2011     $ Change     Change  
Revenues:                              
  Casino   $ 307.7     $ 299.8     $ 7.9     2.6 %
  Rooms     6.0       6.2       (0.2 )   -3.2 %
  Food and Beverage     8.9       10.5       (1.6 )   -15.2 %
  Convention, Retail and Other     2.5       2.3       0.2     8.7 %
  Less - Promotional Allowances     (9.8 )     (11.4 )     1.6     -14.0 %
Net Revenues   $ 315.3     $ 307.4     $ 7.9     2.6 %
                               
Adjusted Property EBITDA   $ 80.9     $ 75.8     $ 5.1     6.7 %
  EBITDA Margin %     25.6 %     24.7 %           0.9 pts  
                               
Operating Income   $ 72.4     $ 67.2     $ 5.2     7.7 %
                               
Gaming Statistics                              
(Dollars in millions)                              
                               
Rolling Chip Volume   $ 6,818.6     $ 7,902.9     $ (1,084.3 )   -13.7 %
  Rolling Chip Win %(1)     2.96 %     2.65 %           0.31 pts  
                               
Non-Rolling Chip Drop   $ 739.0     $ 722.6     $ 16.4     2.3 %
  Non-Rolling Chip Win %(2)     20.8 %     20.0 %           0.8 pts  
                               
Slot Handle   $ 596.3     $ 536.5     $ 59.8     11.1 %
  Slot Hold %(3)     4.2 %     5.3 %           -1.1 pts  
                               
Hotel Statistics                              
                               
Occupancy %     97.3 %     92.9 %           4.4 pts  
Average Daily Rate (ADR)   $ 236     $ 251     $ (15 )   -6.0 %
Revenue per Available Room (RevPAR)   $ 230     $ 233     $ (3 )   -1.3 %
                               

(1) This compares to our Macao Operations trailing 12 month Rolling Chip win percentage of 2.88% (calculated before discounts and commissions).
(2) This compares to the Sands Macao's trailing 12 month Non-Rolling Chip win percentage of 20.8% (calculated before discounts).
(3) This compares to the Sands Macao's trailing 12 month slot hold percentage of 4.4% (calculated before slot club cash incentives).

Marina Bay Sands Third Quarter Operating Results

Marina Bay Sands in Singapore delivered adjusted property EBITDA of $260.8 million for the third quarter. On a hold-adjusted basis, adjusted property EBITDA was $365.6 million. The operating results were unfavorably impacted by lower than expected Rolling Chip win percentage of 1.79% for the quarter, as well as an increase of approximately $15 million in the provision for accounts receivable during the quarter. 

Non-Rolling Chip drop decreased 5.7% to $1.13 billion while Non-Rolling Chip win was flat at $271.9 million. Slot handle decreased 6.1% to $2.62 billion, with slot hold percentage of 5.2%. Total mass win per day during the quarter decreased 2.6% to $4.43 million, compared to $4.55 million in the third quarter of 2011. Rolling Chip volume was $11.79 billion for the quarter. 

The high margin hotel room and mall segments of the property continued to reflect solid revenue growth of 12.4% and 7.6%, respectively. Occupancy and ADR both expanded during the quarter, driving a RevPAR increase of 12.1% compared to the same quarter last year. 

The following table summarizes our key operating results for Marina Bay Sands for the third quarter of 2012 compared to the third quarter of 2011:

             
Marina Bay Sands Operations   Three Months Ended
September 30,
       
(Dollars in millions)   2012     2011     $ Change     Change  
Revenues:                              
  Casino   $ 470.8     $ 651.9     $ (181.1 )   -27.8 %
  Rooms     84.0       74.7       9.3     12.4 %
  Food and Beverage     46.1       49.2       (3.1 )   -6.3 %
  Mall     39.7       36.9       2.8     7.6 %
  Convention, Retail and Other     26.1       32.4       (6.3 )   -19.4 %
  Less - Promotional Allowances     (41.2 )     (52.7 )     11.5     21.8 %
Net Revenues   $ 625.5     $ 792.4     $ (166.9 )   -21.1 %
                               
Adjusted Property EBITDA   $ 260.8     $ 413.9     $ (153.1 )   -37.0 %
  EBITDA Margin %     41.7 %     52.2 %           -10.5 pts  
                               
Operating Income   $ 166.5     $ 315.4     $ (148.9 )   -47.2 %
                               
Gaming Statistics                              
(Dollars in millions)                              
                               
Rolling Chip Volume   $ 11,790.8     $ 16,720.2     $ (4,929.4 )   -29.5 %
  Rolling Chip Win %(1)     1.79 %     2.69 %           -0.90 pts  
                               
Non-Rolling Chip Drop   $ 1,131.3     $ 1,199.2     $ (67.9 )   -5.7 %
  Non-Rolling Chip Win %(2)     24.0 %     22.6 %           1.4 pts  
                               
Slot Handle   $ 2,620.8     $ 2,792.5     $ (171.7 )   -6.1 %
  Slot Hold %(3)     5.2 %     5.3 %           -0.1 pts  
                               
Hotel Statistics                              
                               
Occupancy %     99.8 %     98.1 %           1.7 pts  
Average Daily Rate (ADR)   $ 361     $ 327     $ 34     10.4 %
Revenue per Available Room (RevPAR)   $ 360     $ 321     $ 39     12.1 %
                               

(1) This compares to Marina Bay Sands' trailing 12 month Rolling Chip win percentage of 2.79% (calculated before discounts and commissions).
(2) This compares to Marina Bay Sands' trailing 12 month Non-Rolling Chip win percentage of 23.1% (calculated before discounts).
(3) This compares to Marina Bay Sands' trailing 12 month slot hold percentage of 5.3% (calculated before slot club cash incentives).

Las Vegas Third Quarter Operating Results

The Venetian and The Palazzo delivered adjusted property EBITDA of $98.2 million for the third quarter of 2012, an increase of 4.1% compared to the $94.3 million generated in the third quarter of 2011. Adjusted property EBITDA margin was 26.9% for the quarter. The operating results were positively impacted by higher than expected table games win percentage of 28.1% for the quarter. Table games drop, which benefitted from strong growth in baccarat play, increased 8.5% to a third quarter record of $581.5 million. Slot handle increased 1.7% to $498.4 million while slot hold percentage was 8.7%. Hotel ADR was flat compared to last year's quarter, although RevPAR decreased 5.6% due to a lower occupancy percentage.

The following table summarizes our key operating results for our Las Vegas operations for the third quarter of 2012 compared to the third quarter of 2011:

...
             

Las Vegas Operations
  Three Months Ended
September 30,
       
(Dollars in millions)   2012     2011     $ Change     Change  
Revenues:                              
  Casino   $ 171.5     $ 124.3     $ 47.2     38.0 %
  Rooms     105.7       114.0       (8.3 )   -7.3 %
  Food and Beverage     42.4       57.2       (14.8 )   -25.9 %
  Convention, Retail and Other     68.0       72.7       (4.7 )   -6.5 %
  Less - Promotional Allowances