Sands China 1Q EBITDA rise as premium mass rebound to 50% pre-Covid levels

Macau casino operator Sands China says its adjusted EBITDA more than doubled in the first quarter of 2021 from the preceding quarter, mostly due to a rebound in premium mass revenue.

The British themed resort Londoner Macao had its first phase launch in early February 2021

The British themed resort Londoner Macao had its first phase launch in early February 2021

The unit of US gaming group Las Vegas Sands Corp saw its adjusted EBITDA hit US$100 million in the first three months this year, compared to US$47 million in fourth quarter 2020. The first quarter figure was 49.3% higher than a year earlier.

Analyst Andrew Lee of Jefferies said that ’s EBITDA had improved sequentially to the “highest level since the pandemic started, and higher than both our and consensus estimates”. 

First quarter net revenues at Sands China fell by 4.5% year-on-year, to US$777 million, according to report released by the parent company. But the result was an increase of 15.1% in the fourth quarter of 2020.

Sands China 1Q loss worse than a year earlier but demands remain robust

Nonetheless, Sands China posted an aggregate loss of US$213 million in the first quarter of 2021, an improvement on the US$246 million loss in the preceding quarter. The result was however worse than the loss of US$166 million recorded a year earlier.

“Demand from our customers who have been able to visit remains robust,” said Las Vegas Sands’ chairman and chief executive, Robert Goldstein.

In a presentation issued alongside the results, Sands China said that although visitor arrivals to Macau during the period were just at 16% of pre- Covid-19 pandemic levels, mass gaming revenue was already at 38% of the 2019 levels.

The casino operator saw its premium mass GGR increase 12% sequentially in the first quarter to US$336 million. That was about 43% of first-quarter 2019 levels.

A note from analysts at JP Morgan Securities stated: “The management does not see negative spillover impact from the problematic VIP segment, and it remains confident to attract more high-end players into its direct and premium-mass program, as has been the case so far.”

Sands remain confident in the eventual recovery in tourism across Asia markets

The company saw in the first two weeks of March improved volumes of people visiting when compared to February’s Chinese New Year holiday period, said the firm’s president Wilfred Wong Ying Wai on March 23.

Luxury retail sales achieved records in Macau in the first quarter, the company said. Tenants at Sands China’s retail malls saw their sales grow about two-fold year-on-year and Four Seasons tenant sales were 16% higher than pre-pandemic levels.

Group-wide capital expenditure in the first quarter was US$291 million, including construction, development and maintenance activities amounting to US$268 million in Macau, where the group has rebranded the Cotai Central complex as the Londoner Macao.

“We are fortunate that our financial strength supports our investment and capital expenditure programs in both Macau and , as well as our pursuit of growth opportunities in new markets,” said Mr Goldstein.

In Singapore, Marina Bay Sands‘s net revenues jumped from US$345 million in the fourth quarter of 2020 to US$426 million in the opening quarter of 2021. Still, first quarter revenue was down 30.4% in year-on-year terms.

Adjusted EBITDA at stood at US$144 million, unchanged from the three months ended December 31. A note from Sanford C. Bernstein stated: “local demand continues to lead to profitability even as international business remains absent due to travel restrictions.”


Editing by Rachel Hu