Las Vegas Sands Corp. · NYSE:LVS
Las Vegas Sands — Q3 2014 Earnings Presentation
54 slides from Las Vegas Sands's earnings presentation, Oct 15, 2014
Slide 1: 3Q14 Earnings Call Presentation
The Parisian, Macao The Venetian Macao Sands Cotai Central, Macao Marina Bay Sands, Singapore (Targeted to open late 2015) 3Q14 Earnings Call Presentation October 15, 2014 Sands Macao Four Seasons Macao Sands Bethlehem The Venetian Las Vegas The Palazzo Las Vegas
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation 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 co
Slide 3: The Investment Case for Las Vegas Sands
The Investment Case for Las Vegas Sands The global leader in Integrated Resort development and operation, delivering strong cash flow, earnings and growing recurring dividends Best positioned operator to deliver growth in Asia, with the pre‐eminent destination Integrated Resort properties in the
Slide 4: Third Quarter 2014 Highlights
Third Quarter 2014 Highlights Steady Operating Quarter with Increasing Returns of Capital to Shareholders Adjusted diluted EPS increased 2.4% to $0.84 per share Consolidated adjusted property EBITDA up 0.6% to $1.28 billion Macao – Adjusted property EBITDA increased 3.2% to $809.0 million, ref
Slide 5: Third Quarter 2014 Financial Results
Third Quarter 2014 Financial Results $ in millions, except per share information 3Q13 3Q14 $ Change % Change Net Revenue $ 3,568.5 $ 3,533.1 $ (35.4) ‐1.0% Adjusted Property EBITDA $ 1,275.8 $ 1,283.9 $ 8.1 0.6% Adjusted Property EBITDA Margin 35.8% 36.3% 50 bps Adjusted Diluted EPS $ 0.82 $ 0.84 $
Slide 6: Macao – Growth in Mass Segments; VIP Challenging
Macao – Growth in Mass Segments; VIP Challenging Singapore – Growth in Mass Segments; VIP Challenging Segments Macao – Steady EBITDA with growth in mass and retail offset by contracting VIP business — Mass table win increased 14.8% to $1.22 billion — Slot and ETG win increased 6.0% to $175.9 milli
Slide 7: Increasing Return of Capital to Shareholders
Increasing Return of Capital to Shareholders Nearly $9.0 Billion of Capital Returned to Shareholders Over Last 11 Quarters LVS Recurring Dividends per Share1 The LVS Board of Directors increased the LVS recurring dividend by 30.0% to $2.60 per share for $3.00 $2.60 the 2015 calendar year ($0.65 pe
Slide 8: LVS Generates Greater Forward Dividend Yield than the S&P500 Index
LVS Generates Greater Forward Dividend Yield than the S&P500 Index 2015 Forward Dividend Yield of LVS and S&P5001 Sensitivity of LVS Dividend Yield 5.5% 5.5% 5.2% Dividend 5.0% 5.0% Yield as of 4.5% 4.4% 4.5% 4.4% 4.3% 10/14/14² 4.0% 4.0% 3.7% 3.5% 3.5% 3.3% +210 bps 3.0% 2.9% 3.0% 2.5% 2.5% 2.3% 2.
Slide 9: Strong Cash Flow, Balance Sheet and Liquidity
Strong Cash Flow, Balance Sheet and Liquidity Flexibility for Future Growth Opportunities and Increasing Return of Capital At September 30, 2014: Trailing Twelve Months EBITDA – $5.29 billion Trailing Twelve Months LVS Dividends Paid – $1.50 billion Trailing Twelve Months SCL Dividends Paid –
Slide 10: Macao Operating Performance
Macao Operating Performance Growing Mass Business Offset by Contracting VIP Segment Macao Property Operations Adjusted Property EBITDA and Adjusted Property EBITDA Margin Actual Hold‐Normalized ($MM) +3.2% ‐1.6% $1,000 60% $900 $809.0 50% $784.3 $784.3 $772.1 $800 $700 40% $600 34.0% 35.1% 34.0% 35.
Slide 11: Macao Gaming Performance
Macao Gaming Performance Growth and Increased Efficiency Across Macao Mass Property Portfolio Mass tables — Mass table win up 14.8% to $1.22 billion compared to 16.3% growth for the Macao market — Mass table efficiency up 5.1% to $11,518 win per table per day (reflecting an increase of 97 mass tab
Slide 12: Continued Growth in Macao's High Margin Mass Market
Continued Growth in Macao’s High Margin Mass Market Macao Mass Table and Slot Gross Gaming Revenue ($MM) $20,000 60% $18,115 $18,000 50% $16,000 $15,309 $14,000 39% 36% 40% 33% $11,674 $12,000 30% 30% 31% $10,000 28% 30% $8,949 $8,000 $6,587 16% 20% $6,000 $4,952 $4,358 $4,520 $3,928 $4,000 $3,355 1
Slide 13: The Mass Business is the Principal Profit Pool and Primary Driver of Earnings Growth
The Mass Business is the Principal Profit Pool and the Primary Driver of Earnings Growth in Macao Macao Market VIP and Mass Gaming Estimated Operating Profit ¹ ($MM) $12,000 (XX%) = % of total operating profit for period $10,143 $10,000 $9,108 $2,897 (29%) $8,000 $7,307 $2,985 (33%) $6,025 $2,637 $6
Slide 14: Macao: Diversified and Stable Sources of Departmental Profit
Macao: Diversified and Stable Sources of Departmental Profit For Las Vegas Sands and Sands China Macao Departmental Profit Contribution by Segment TTM 3Q131 TTM 3Q14¹ VIP 16% VIP 20% Other 2% Other 2% Mall 8% Mall 8% Mass Tables 50% Mass Tables 53% Hotel 13% Hotel 11% Slots 9% Slots 8% Mass Tables /
Slide 15: Labor Costs in Macao
Labor Costs in Macao While Costs Have Increased, They Are Relatively Stable as a % of Net Revenue SCL Historical Labor Expense Opening of ($MM) Sands Cotai Central $1,000 25% 927.0 $900 812.5 $800 769.7 20% 679.2 $700 $600 15% 529.9 $500 450.7 $400 11.8% 10% 10.9% 10.9% 10.4% 10.6% 10.9% $300 $200 5
Slide 16: Executing Our Mass Strategy in Macao
Executing Our Mass Strategy in Macao Family-friendly Entertainment World Class Concerts, Sporting Events Portfolio of Nearly and Other Entertainment Offerings 9,300 Suites and Hotel Rooms Over 1.2 million sq. feet of World Class Shopping The Broadest and Deepest Market-Leading Customer Database Mass
Slide 17: Evolution of the Macao Mass Visitor
Evolution of the Macao Mass Visitor Drivers As a result, Macao’s Mass visitors are: More efficient and affordable Coming From Farther transportation infrastructure Away Additional tourism attractions in Staying Longer Macao and Hengqin Island Greater number of hotel rooms in Spending Mor
Slide 18: Strong Growth in Mainland Chinese Visitation to Macao
Strong Growth in Mainland Chinese Visitation to Macao Strongest Growth Realized in Provinces Served by High Speed Rail Year‐Over‐Year Visitation Growth Mainland Chinese Visitation to Macao Twelve Months Ended August 31, Population GDP Per Penetration Province 2013 2014 % Change (MM) Capita (US$) Rat
Slide 19: Growth in Macao Mass Table Business
Growth in Macao Mass Table Business Growth and Productivity Gains in Macao’s Most Important Segment Mass Table Win Increased 14.8% Mass Table Win per Table per Day2 ($MM) $16,000 $1,600 60% 55% $14,000 $1,400 $1,336.7 $13,210 $1,248.8 50% $12,143 $1,218.5 $1,218.2 $11,963 $12,000 $11,518 $1,200 45%
Slide 20: Extending Our Leadership in Macao's Mass Market
Extending Our Leadership in Macao’s Mass Market Meaningful Opportunity to Continue to Grow Mass Table Business Illustrative Profitability of LVS’s Macao Market Mass Table Offering ($MM)1 Mass Table Win per Unit per Day $11,000 $11,518 $12,000 $13,000 $14,000 $15,000 $16,000 1,300 $2,218 $2,323 $2,42
Slide 21: Macao: Healthy Growth in Base Mass and Premium Mass Revenues
Macao: Healthy Growth in Base Mass and Premium Mass Revenues LVS Base Mass Table Win by Quarter LVS Premium Mass Table Win by Quarter LVS Departmental Profit Margin: 40% - 50% LVS Departmental Profit Margin: 25% - 40% Avg. Win per Table per Day: $9,218 Avg. Win per Table per Day: $17,676 ($MM) ($MM)
Slide 22: Profitable Macao Slot Business Continues to Grow
Profitable Macao Slot Business Continues to Grow Macao Slot and ETG Win Increased 6.0% Macao Slot and ETG Win per Unit per Day ($MM) $220 45% $500 $200 $450 40% $424 $184.3 $177.6 $401 $180 $173.8 $175.9 $400 $388 $165.9 35% $353 $160 $350 $327 32.6% 32.7% 32.2% 32.5% 30% $140 31.5% $300 $120 25% $2
Slide 23: Healthy Mass Growth Across our Macao Property Portfolio
Healthy Mass Growth Across our Macao Property Portfolio Mass Table, Slot and ETG Win Per Day Cotai Strip Properties Peninsula Total ($MM) $18.0 $15.2 $15.0 $13.0 $13.3 $12.0 $11.2 $9.0 $6.6 $5.9 $6.0 $5.4 0.0% $4.3 $3.0 $2.1 $2.2 $1.0 $1.0 $0.0 Venetian Sands Cotai Plaza Casino Total Sands Macao Tot
Slide 24: VIP Business in Macao Has Contracted
VIP Business in Macao Has Contracted Rolling Segment Represents 16% of Our TTM Cash Flow Rolling Win Decreased 21.9% Rolling Win per Table per Day ($MM) $45,000 $1,600 30% $1,445.3 $39,167 $40,000 $1,400 $1,327.2 $1,303.4 25% $35,000 $32,837 $32,568 $1,200 $1,116.9 $30,365 $29,893 $1,018.6 20% $30,0
Slide 25: Expanding Our Critical Mass on the Cotai Strip
Expanding Our Critical Mass on the Cotai Strip The Parisian Macao The Parisian Macao will be a $2.7 billion themed, aspirational Rendering of The Parisian Macao destination Integrated Resort Construction is progressing Targeted opening date: Late 2015 Hotel rooms and suites: 3,000+ Gaming
Slide 26: Marina Bay Sands Operations
Marina Bay Sands Operations Record Mass and Retail Business Performance Offset by Contracting VIP Segment Adjusted Property EBITDA Adjusted property EBITDA of $351.7 million, a and Adjusted Property EBITDA Margin decrease of 5.9% Actual Hold‐Normalized ($MM) — Hold‐normalized adjusted property EBI
Slide 27: Singapore: Diversified and Stable Sources of Departmental Profit
Singapore: Diversified and Stable Sources of Departmental Profit For Las Vegas Sands Singapore Departmental Profit Contribution by Segment TTM 3Q131 TTM 3Q14¹ Other VIP VIP Other 5% 13% 11% 5% Mass Tables Mall Mass Tables Mall 38% 7% 38% 7% Hotel Hotel 17% 18% Slots Slots 20% 21% Mass Tables / Slots
Slide 28: Asian Retail Mall Revenue Increasing Steadily
Asian Retail Mall Revenue Increasing Steadily Trailing Twelve Months Retail Mall Revenue ($MM) TTM 3Q14 Sales $600 per Sq. Foot³ $536 $502 $512 $500 $478 $450 MBS: $167 $1,423 $156 $160 $400 $154 $155 SCC: $52 $1,472 $43 $45 $300 $42 $38 Four Seasons: $125 $129 $126 $5,810 $113 $200 $97 Venetian: $1
Slide 29: Disciplined Execution of Our Global Growth Strategy
Disciplined Execution of Our Global Growth Strategy As the global leader in Integrated Resort development and operation, Las Vegas Sands is uniquely positioned to bring its unmatched track record and powerful convention‐based business model to the world’s most promising Integrated Resort developme
Slide 30: Sands
Sands LAS VEGAS SANDS CORP,
Slide 31: Appendix
Appendix Sanes LAS VEGAS SANDS CORP.
Slide 32: Historical Hold-Normalized Adj. Property EBITDA
Historical Hold‐Normalized Adj. Property EBITDA1 $ in millions 3Q13 4Q13 1Q14 2Q14 3Q14 Macao Property Operations Reported $ 784.3 $ 835.9 $ 939.8 $ 801.3 $ 809.0 Hold‐Normalized $ 784.3 $ 866.8 $ 864.8 $ 752.5 $ 772.1 Marina Bay Sands Reported $ 373.6 $ 258.8 $ 435.2 $ 417.8 $ 351.7 Hold‐Normalized
Slide 33: Strong Historical Revenue and EBITDA Growth Over the Last Four Years
Strong Historical Revenue and EBITDA Growth Over the Last Four Years LVS Historical Net Revenue LVS Historical Adjusted Property EBITDA ($MM) ($MM) $16,000 $6,000 $14,824 $5,290 $13,770 $14,000 $5,000 $4,763 $12,000 $11,131 $4,000 $3,791 $9,411 $3,532 $10,000 $3,000 $8,000 $6,853 $2,229 $6,000 $2,00
Slide 34: Strong Historical Adjusted Net Income and Adjusted EPS Growth
Strong Historical Adjusted Net Income and Adjusted EPS Growth Over the Last Four Years LVS Historical Adjusted Net Income LVS Historical Adjusted Diluted Earnings per Share ($MM) $4.00 $3,000 $2,753 $3.50 $3.38 $2,500 $2,399 $3.00 $2.90 $2,000 $2.50 $1,768 $1,644 $2.14 $2.02 $2.00 $1,500 $1.50 $1,00
Slide 35: Capital Expenditures Expectations
Capital Expenditures Expectations Future Investments Include The Parisian Macao, St. Regis at SCC and Maintenance ($MM) LVS Capex Expectations $2,500 $2,425 $400 $2,000 $1,449 $1,500 $1,385 $1,325 $107 $1,275 $40 $145 $200 $140 $1,000 $898 $830 $49 $400 $600 $210 $100 $630 $100 $25 $192 $100 $150 $1
Slide 36: Debt Maturity Profile
Debt Maturity Profile Debt Maturity by Year at September 30, 2014 ($MM) $6,000 $5,696 $5,000 2,115 $4,000 $3,000 1,950 $2,204 $2,000 $1,486 1,191 $1,000 833 1,631 $333 235 979 $26 $102 $102 180 418 $0 1 2014 2015 2016 2017 2018 2019 2020 SCL MBS USRG LVSC % of Total 0.3% 1% 1% 3% 15% 22% 57% Long Te
Slide 37: LVS Outperforming the Macao Market in EBITDA Generation and Growth
LVS Outperforming the Macao Market in EBITDA Generation and Growth 2Q14 TTM Macao Market EBITDA1 2Q14 TTM Macao Market EBITDA Growth ($MM) ($MM) $4,000 $11,000 $3,361 $10,073 $3,500 $1,160 $10,000 $3,000 $964 $9,000 $2,500 $7,949 $8,000 55% of $2,000 $1,820 Incremental $1,436 $7,000 45% of EBITDA $1
Slide 38: MBS – Credit Collections Remain Healthy
MBS – Credit Collections Remain Healthy Reserve Balance Has Now Increased to 41.9% of Gross A/R Casino Credit Collections Remain Stable ($MM) $450 $418 $408 $403 $378 $368 $361 $375 $345 $342 $326 $314 $311 $317 $281 $300 $250 $271 $225 $203 $146 $150 $75 $40 $0 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q
Slide 39: Las Vegas Operations
Las Vegas Operations Strength in Baccarat Business and RevPAR Adjusted Property EBITDA Adjusted property EBITDA was $90.2 million, an and Adjusted Property EBITDA Margin increase of 3.5% Actual Hold‐Normalized ($MM) — On a hold‐normalized basis, adjusted property EBITDA was $83.6 million, an incre
Slide 40: Sands Bethlehem Operations
Sands Bethlehem Operations Leading Tri‐State Region Property With Investments for Future Growth Adjusted Property EBITDA Adjusted property EBITDA increased 1.0% to $29.8 and Adjusted Property EBITDA Margin million ($MM) Table games drop increased 5.0% to reach $274.6 million, $35 40% $29.6 $29.8
Slide 41: Macao Market Background and Infrastructure Slides
Macao Market Background and Infrastructure Slides
Slide 42: VIP Gaming Represents 62% of Total Macao GGR
VIP Gaming Represents 62% of Total Macao GGR… …but Mass Tables and Slots Generate ~71% of Gaming Operating Profit TTM 3Q14 Macao Market Composition of Macao Market Gross Gaming Gross Gaming Revenue Revenue and Est. Gaming Operating Profit2 3Q14 YoY ($MM) Growth $50,000 $47,080 100% ‐7% $45,000 29% $
Slide 43: Five Trends that Will Contribute To Growth in the Macao Market
Five Trends that Will Contribute To Growth in the Macao Market Over the Next Five Years 200 million Chinese are expected to travel outside of China by 1 2020, compared to 83 million in 2012 and 97 million in 2013 Infrastructure and transportation connectivity throughout 2 China, especially in the Pe
Slide 44: China Is The World's Largest and Fastest Growing Outbound Tourism Market
1 China Is The World’s Largest and Fastest Growing Outbound Tourism Market Outbound Travel from China Outbound Travel Penetration¹ 350 50% Expenditure (US$bn) 44.5% $306 China 300 Chinese outbound 45% tourists (millions) Japan $268 40% Korea CLSA estimates 250 Taiwan $234 35% CAGR 2009‐2013 2012‐202
Slide 45: Strong Growth in Mainland Chinese Visitation to Macao
Strong Growth in Mainland Chinese Visitation to Macao 1 Strongest Growth Realized in Provinces Served by High Speed Rail Year‐Over‐Year Visitation Growth Mainland Chinese Visitation to Macao Twelve Months Ended August 31, Population GDP Per Penetration Province 2013 2014 % Change (MM) Capita (US$) R
Slide 46: Infrastructure: China's High-Speed Rail
2 Infrastructure: China’s High‐Speed Rail Connecting More of Mainland China to Macao Beijing – Guangzhou High‐Speed Rail World’s longest high‐speed rail route Covers 2,298km in ~10 hours (compared to 22 hours previously) at a cost of 862 yuan (~US$140) per one way ticket Guangzhou – Zhuhai Inter
Slide 47: Infrastructure: Meaningful Improvements Throughout the Pearl River Delta Region
Infrastructure: Meaningful Improvements 2 Throughout the Pearl River Delta Region Guangzhou Wuhan – Guangzhou High‐Speed Rail Population: 13M • 3.5 hour train ride GDP Per Capita: US$14,000 • 75‐80 trains in each direction per day Guangzhou – Shenzhen – Hong Kong Rail Guangzhou – Zhuhai Intercity Ra
Slide 48: Chinese Day-Trip and Overnight Visitation To Macao Both Continue to Grow
Chinese Day‐Trip and Overnight Visitation To 3 Macao Both Continue to Grow Mainland China Day‐Trip Visitors to Macao Mainland China Overnight Visitors to Macao Growth ‐9% +19% +28% 0% +10% Growth ‐1% +22% +16% +10% +10% (MM) (MM) 12.0 12.0 10.0 9.7 10.0 8.8 8.8 8.9 8.1 8.0 8.0 7.3 6.9 6.3 5.8 6.0 5.
Slide 49: Visitation to Macao Can Meaningfully Grow
3 Visitation to Macao Can Meaningfully Grow 21.8 Million Residents of Mainland China Visited Hong Kong in 1H14 Mainland China Visitation to Macao and Hong Kong Macao ‐5% +20% +22% +5% +10% +15% Hong Kong +6% +26% +24% +24% +17% +16% (MM) 45.0 40.7 40.0 34.9 35.0 30.0 28.1 25.0 22.7 21.8 Hong Kong 20
Slide 50: Opportunity for Increased Overnight Visitation and Length of Stay In Macao
Opportunity for Increased Overnight Visitation 3 and Length of Stay In Macao Composition of 2013 Visitation from Mainland China Avg. Length of Stay for Mainland Chinese Total 2013 Mainland Daytrip Visitors Overnight Visitors Overnight Visitors in 2013 Chinese Visitor Nights¹ (MM) (Days) (MM) 25.0 23
Slide 51: Hengqin Island Expands Critical Mass of Tourism Offerings
Hengqin Island Expands Critical Mass of 4 Tourism Offerings for Visitors to the Region Map of Hengqin Island New Area Important Facts Island adjacent to Macao (3X the size of Macao) that has been welcomed by President Xi Jinping as a strategic zone for cooperation among Guangdong Province, Hong Ko
Slide 52: Market Leading Hotel Capacity at LVS
5 Market Leading Hotel Capacity at LVS Las Vegas Sands Operates 38% of Macao’s Current 4/5‐Star Hotel Inventory Macao Market Gaming Operator Hotel Rooms1 10,000 Hotel % of Gaming % of Total 9,277 Gaming Operator Rooms Operators Market Sands Macao, 289 9,000 Four Seasons Macao, 360 Las Vegas Sands `
Slide 53: Market Leading Hotel Capacity at LVS
5 Market Leading Hotel Capacity at LVS Projected Macao Market 4/5 Star Hotel Rooms at December 31, 2017 Macao Market Gaming Operator Hotel Rooms at December 31, 20171 14,000 Hotel % of Gaming % of Total 12,677 Gaming Operator Rooms Operators Market St. Regis 12,000 Macao, 400 Las Vegas Sands ` 12,67
Slide 54: Sands
Sands LAS VEGAS SANDS CORP,