Sands: Macao visitation may be off 80 percent on coronavirus fears

Visitation to casinos in Macao may be off as much as 80 percent because of the spread of the coronavirus across China, and Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson said the protective masks worn by company employees make their Macao casinos “look like an operating room.”

Chief Operating Officer Robert Goldstein said during a Wednesday earnings call that dealers were the first to wear protective health masks, but now most everybody has them.

The government of Macao hasn’t ordered the Chinese enclave’s casinos closed, and Sands executives said in a conference call with investors that insurance wouldn’t cover losses if that were to occur.

Still, Adelson said the company is doing all it can to assist the nation’s health agencies in addressing the Wuhan coronavirus. Keeping guests and employees safe is a top priority, he said.

As of Thursday, Macao had five confirmed cases of Wuhan coronavirus, according to various news reports, and China had more than 7,000 cases.

The company, which generates most of its revenue from Macao with its Venetian Macao, Parisian Macao, Sands Macao and Sands Cotai Central operations, reported a slight increase in revenue compared with a year ago for the fourth quarter that ended Dec. 31.

The company reported fourth-quarter net income of $783 million, 82 cents a share, on revenue of $3.509 billion. That compared with a loss of $154 million, 22 cents a share, on revenue of $3.475 billion for the same period a year earlier.

In the fourth quarter of 2018, the company reported a non-recurring tax item that resulted in the loss.

The company has high hopes for Macao, with a $2.2 billion investment in its Londoner project, which is slated to open later this year. Goldstein said the company will be the premium mass market leader in the area when the Londoner opens.

Adelson and Goldstein said Sands is “the biggest investor in Macao by far” among companies with properties in the market.

“We look forward to additional investments in Macao,” Adelson said.

Despite the turmoil in Macao, travelers aren’t flocking to Singapore as an alternative, Goldstein said.

Sands also is investing heavily in Singapore, where the company is one of two operators of integrated resorts. In April, the company pledged $3.3 billion to expand the iconic Marina Bay Sands property with a new 1,000-suite hotel tower and a 15,000-seat arena.

Goldstein said the company’s Las Vegas operations performed above expectations despite a decline in Asian visitation citywide.

The company reported net revenue of $475 million for the quarter compared with $424 million for the fourth quarter of 2018. At The Venetian and Palazzo, table-game win was up 7.1 percentage points to 19.8 percent with a 2.7 percent increase in drop to $540 million. Slot handle was up 5.9 percent to $841 million while win percentage stayed at 8 percent.

The company reported an occupancy rate of 94.5 percent for the quarter, up 3.4 points, and the average daily room rate was up 1.2 percent to $253 a night.

Sands declared a quarterly dividend of 77 cents a share — $3.08 a share for the entire year. It’s payable March 26 to shareholders of record on March 18. The company also repurchased $754 million in common stock for the year.

Despite stock volatility during the week because of the coronavirus, shares closed up 26 cents, 0.4 percent, about 60 percent above the average daily volume. After hours, shares fell 20 cents, 0.3 percent, to close at $64.50 a share, about $10 below the 52-week high.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.