Wednesday, October 21, 2015

Las Vegas Sands Reports Third Quarter 2015 Results

Las Vegas Sands reported third quarter 2015 earnings results earlier today. The weak Macau market caused gaming revenue to decline significantly, but that softness was offset by a strong performance at Marina Bay Sands in Singapore and at Bethlehem Sands in Pennsylvania.

In Las Vegas at the company's Venetian and Palazzo properties gaming revenue was down 22.5%. Non-gaming on the other hand was very strong with rooms up 19.4% and food and beverage up 33.9%.

Perhaps the most surprising thing about today's results was the Sands' decision to raise the quarterly dividend by 10.8% from 65 to 72 cents per share starting in 2016. With the weakness in Macau I was thinking the company might have to keep the dividend steady, or even cut the dividend similar to what Wynn Resorts did recently.

Speaking of Wynn, Steve Wynn's comments about the Macau government and the government's response were bound to be asked about on the Las Vegas Sands earnings conference call.

As expected Sheldon Adelson was overtly respectful to the government saying, "We're in China, let the Chinese decide what they want to do with the concessionaires. Again it's our privilege, it's not our right. So we'll do everything we can to justify getting the blessings from the Macau government. It's their government, it's their right and we'll do whatever they ask us to do."