Sands China reported 1Q15 adjusted property EBITDA of US$528 mn, down 44% y/y and 26% q/q, below consensus expectations of US$574 mn and Barclays’ US$593 mn estimate.
According to a research note from Barclays, EBITDA was lower than its estimates due to lower than expected margins. Management plans to focus on cost cutting over the next quarters.
Also, management gave more specific guidance that Parisian would only open in 2H16.
Here’s more from Barclays:
On a hold-normalized basis, EBITDA was down by 39% y/y and 23% q/q; hold-normalized EBITDA margin was down to 30.2% in 1Q15 vs the 33.4% in 4Q14 and 33.8% in 4Q14.
VIP volumes were weak at down 54% y/y and down 24% q/q. With a VIP hold rate of 2.8% in 1Q15 (vs 3.0% in 4Q14 and 3.2% in 1Q14), VIP revenues were down 59% y/y and down 29% q/q at US$592 mn. Management said not doing phone betting has caused some impact.
Mass table revenues were down 24% y/y and 8% q/q to US$1.0 bn. Premium mass table revenue saw a y/y decline of 29.0% while the base mass table revenue was down 20.6% y/y. Mass table count increased slightly to 1,191 in 1Q15 from 1,148 in 4Q14; win per mass table per day decreased by 24% y/y and 8% q/q to US$1,013. Sands had a lower mass market share in 1Q15, down at 31.0% from the 32.3% in 4Q14 (source: APG).
Slot revenues were down 26% y/y and down 14% q/q.