Sands China sees higher profit margins

In Macau, Sands China is seeing higher profit margins, and if tourist numbers rise again, this trend is likely to continue.

During Sands China’s 3Q23 results conference, this encouraging change was emphasized. A major factor in this has been the shift in the market from VIP to mass and premium mass sectors.

The group’s EBITDA in the September quarter was US$631 million, with a 35.3% margin, up 210 basis points from the prior quarter, according to Patrick Dumont, President and COO of Sands China’s parent company, Las Vegas Sands. The Venetian Macao produced US$290 million in EBITDA at a 40.1% margin, and The Londoner produced US$167 million in EBITDA at a 32.2% margin.

With Macau’s revenues rebounding and the company’s business mix improving, Dumont voiced optimism about Sands China’s margins’ future expansion. Notwithstanding anticipated building delays in 2024, The Londoner Macao’s development into a top attraction is anticipated to propel future EBITDA growth and margin improvement.

Moreover, Sands moved tables from the premium mass to the basic mass sector in Q3 in response to consumer demand, which increased profits even more. The favorable trend has been strengthened by the steady increase in visitor numbers.

In addition, Sands China is getting closer to its goal margin levels as a result of the market’s continuous recovery and rising levels of visitation and tourism, as Dumont stressed the need to cover fixed expenditures. It’s important to remember that Macau has seen around a million fewer tourists than it did before to the epidemic, which represents a 20% decrease in tourism.

Regarding The Londoner’s success and future prospects, Dumont was upbeat and predicted that margins would continue to rise as long as tourism-related income kept coming into the business.

Original story by: IAG