UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q | ||||||||||||||||||||
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
For the quarterly period ended September 30, 2024
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
For the transition period from to
Commission file number 001-32373
LAS VEGAS SANDS CORP.
(Exact name of registrant as specified in its charter)
| Nevada | 27-0099920 | |||||||
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
5420 S. Durango Dr., Las Vegas, Nevada, 89113 | |||||||||||
(Address of principal executive offices) (Zip Code) | |||||||||||
(702) 923-9000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
| Common Stock ($0.001 par value) | LVS | New York Stock Exchange | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large Accelerated Filer | ☒ | Accelerated Filer | ☐ | |||||||||||||||||
| Non-accelerated Filer | ☐ | Smaller Reporting Company | ☐ | |||||||||||||||||
| Emerging Growth Company | ☐ | |||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.
| Class | Outstanding at October 23, 2024 | |||||||
| Common Stock ($0.001 par value) | 725,026,178 shares | |||||||
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
Table of Contents
2
PART I FINANCIAL INFORMATION
ITEM 1 — FINANCIAL STATEMENTS
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions, except per share data) (Unaudited) | |||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Casino | $ | 1,936 | $ | 2,008 | $ | 6,199 | $ | 5,411 | |||||||||||||||
| Rooms | 314 | 342 | 957 | 881 | |||||||||||||||||||
| Food and beverage | 152 | 156 | 450 | 423 | |||||||||||||||||||
| Mall | 189 | 201 | 537 | 535 | |||||||||||||||||||
| Convention, retail and other | 91 | 88 | 259 | 207 | |||||||||||||||||||
| Net revenues | 2,682 | 2,795 | 8,402 | 7,457 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Casino | 1,120 | 1,103 | 3,441 | 3,011 | |||||||||||||||||||
| Rooms | 79 | 80 | 234 | 207 | |||||||||||||||||||
| Food and beverage | 129 | 128 | 379 | 349 | |||||||||||||||||||
| Mall | 23 | 23 | 62 | 65 | |||||||||||||||||||
| Convention, retail and other | 62 | 52 | 177 | 141 | |||||||||||||||||||
Provision for (recovery of) credit losses | (5) | 3 | 10 | 2 | |||||||||||||||||||
| General and administrative | 293 | 290 | 847 | 820 | |||||||||||||||||||
| Corporate | 68 | 49 | 215 | 166 | |||||||||||||||||||
| Pre-opening | 4 | 3 | 10 | 13 | |||||||||||||||||||
| Development | 55 | 44 | 169 | 140 | |||||||||||||||||||
| Depreciation and amortization | 324 | 313 | 960 | 875 | |||||||||||||||||||
| Amortization of leasehold interests in land | 15 | 15 | 45 | 43 | |||||||||||||||||||
| Loss on disposal or impairment of assets | 11 | 4 | 41 | 22 | |||||||||||||||||||
| 2,178 | 2,107 | 6,590 | 5,854 | ||||||||||||||||||||
Operating income | 504 | 688 | 1,812 | 1,603 | |||||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||
| Interest income | 67 | 79 | 218 | 225 | |||||||||||||||||||
| Interest expense, net of amounts capitalized | (179) | (200) | (547) | (628) | |||||||||||||||||||
Other income (expense) | 11 | 4 | 16 | (17) | |||||||||||||||||||
Income before income taxes | 403 | 571 | 1,499 | 1,183 | |||||||||||||||||||
Income tax expense | (50) | (122) | (139) | (221) | |||||||||||||||||||
Net income | 353 | 449 | 1,360 | 962 | |||||||||||||||||||
Net income attributable to noncontrolling interests | (78) | (69) | (238) | (123) | |||||||||||||||||||
Net income attributable to Las Vegas Sands Corp. | $ | 275 | $ | 380 | $ | 1,122 | $ | 839 | |||||||||||||||
Earnings per share: | |||||||||||||||||||||||
Basic | $ | 0.38 | $ | 0.50 | $ | 1.52 | $ | 1.10 | |||||||||||||||
Diluted | $ | 0.38 | $ | 0.50 | $ | 1.51 | $ | 1.09 | |||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||||||||
| Basic | 730 | 764 | 740 | 764 | |||||||||||||||||||
| Diluted | 731 | 766 | 742 | 767 | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions) (Unaudited) | |||||||||||||||||||||||
| Net income | $ | 353 | $ | 449 | $ | 1,360 | $ | 962 | |||||||||||||||
| Currency translation adjustment | 136 | (17) | 66 | (46) | |||||||||||||||||||
| Cash flow hedge fair value adjustment | 3 | 2 | (11) | (4) | |||||||||||||||||||
| Total comprehensive income | 492 | 434 | 1,415 | 912 | |||||||||||||||||||
Comprehensive income attributable to noncontrolling interests | (80) | (70) | (236) | (123) | |||||||||||||||||||
| Comprehensive income attributable to Las Vegas Sands Corp. | $ | 412 | $ | 364 | $ | 1,179 | $ | 789 | |||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
| Las Vegas Sands Corp. Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
| Common Stock | Treasury Stock | Capital in Excess of Par Value | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Deficit) | Noncontrolling Interests | Total | |||||||||||||||||||||||||||||||||||
| (In millions) (Unaudited) | |||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2023 | $ | 1 | $ | (4,481) | $ | 6,708 | $ | (41) | $ | 2,143 | $ | (171) | $ | 4,159 | |||||||||||||||||||||||||||
Net income | — | — | — | — | 380 | 69 | 449 | ||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | (18) | — | 1 | (17) | ||||||||||||||||||||||||||||||||||
| Cash flow hedge fair value adjustment | — | — | — | 2 | — | — | 2 | ||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | 1 | — | — | — | 1 | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | 11 | — | — | — | 11 | ||||||||||||||||||||||||||||||||||
Dividends declared ($0.20 per share) (Note 5) | — | — | — | — | (153) | — | (153) | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2023 | $ | 1 | $ | (4,481) | $ | 6,720 | $ | (57) | $ | 2,370 | $ | (101) | $ | 4,452 | |||||||||||||||||||||||||||
| Balance at January 1, 2023 | $ | 1 | $ | (4,481) | $ | 6,684 | $ | (7) | $ | 1,684 | $ | (225) | $ | 3,656 | |||||||||||||||||||||||||||
Net income | — | — | — | — | 839 | 123 | 962 | ||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | (47) | — | 1 | (46) | ||||||||||||||||||||||||||||||||||
Cash flow hedge fair value adjustment | — | — | — | (3) | — | (1) | (4) | ||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | 4 | — | — | — | 4 | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | 33 | — | — | 1 | 34 | ||||||||||||||||||||||||||||||||||
| Tax withholding on vesting of equity awards | — | — | (1) | — | — | — | (1) | ||||||||||||||||||||||||||||||||||
Dividends declared ($0.20 per share) (Note 5) | — | — | — | — | (153) | — | (153) | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2023 | $ | 1 | $ | (4,481) | $ | 6,720 | $ | (57) | $ | 2,370 | $ | (101) | $ | 4,452 | |||||||||||||||||||||||||||
| Balance at June 30, 2024 | $ | 1 | $ | (5,850) | $ | 6,508 | $ | (53) | $ | 3,148 | $ | 140 | $ | 3,894 | |||||||||||||||||||||||||||
| Net income | — | — | — | — | 275 | 78 | 353 | ||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | 135 | — | 1 | 136 | ||||||||||||||||||||||||||||||||||
| Cash flow hedge fair value adjustment | — | — | — | 2 | — | 1 | 3 | ||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | 1 | — | — | — | 1 | ||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | 13 | — | — | 1 | 14 | ||||||||||||||||||||||||||||||||||
Repurchase of common stock | — | (454) | — | — | — | — | (454) | ||||||||||||||||||||||||||||||||||
Forward contract for purchase of noncontrolling interest | — | — | (103) | — | — | — | (103) | ||||||||||||||||||||||||||||||||||
| Capped call option contract | — | — | (50) | — | — | — | (50) | ||||||||||||||||||||||||||||||||||
Dividends declared ($0.20 per share) (Note 5) | — | — | — | — | (147) | — | (147) | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2024 | $ | 1 | $ | (6,304) | $ | 6,369 | $ | 84 | $ | 3,276 | $ | 221 | $ | 3,647 | |||||||||||||||||||||||||||
| Balance at January 1, 2024 | $ | 1 | $ | (4,991) | $ | 6,481 | $ | 27 | $ | 2,600 | $ | (14) | $ | 4,104 | |||||||||||||||||||||||||||
| Net income | — | — | — | — | 1,122 | 238 | 1,360 | ||||||||||||||||||||||||||||||||||
Currency translation adjustment | — | — | — | 65 | — | 1 | 66 | ||||||||||||||||||||||||||||||||||
| Cash flow hedge fair value adjustment | — | — | — | (8) | — | (3) | (11) | ||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | 1 | — | — | — | 1 | ||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | 41 | — | — | 2 | 43 | ||||||||||||||||||||||||||||||||||
| Tax withholding on vesting of equity awards | — | — | (4) | — | — | — | (4) | ||||||||||||||||||||||||||||||||||
Settlement of forward contract for purchase of noncontrolling interest | — | — | 3 | — | — | (3) | — | ||||||||||||||||||||||||||||||||||
Repurchase of common stock | — | (1,313) | — | — | — | — | (1,313) | ||||||||||||||||||||||||||||||||||
Forward contract for purchase of noncontrolling interest | — | — | (103) | — | — | — | (103) | ||||||||||||||||||||||||||||||||||
| Capped call option contract | — | — | (50) | — | — | — | (50) | ||||||||||||||||||||||||||||||||||
Dividends declared ($0.60 per share) (Note 5) | — | — | — | — | (446) | — | (446) | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2024 | $ | 1 | $ | (6,304) | $ | 6,369 | $ | 84 | $ | 3,276 | $ | 221 | $ | 3,647 | |||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) (Unaudited) | |||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 1,360 | $ | 962 | |||||||
Adjustments to reconcile net income to net cash generated from operating activities: | |||||||||||
| Depreciation and amortization | 960 | 875 | |||||||||
| Amortization of leasehold interests in land | 45 | 43 | |||||||||
| Amortization of deferred financing costs and original issue discount | 44 | 46 | |||||||||
| Change in fair value of derivative asset/liability | — | (1) | |||||||||
| Paid-in-kind interest income | (53) | (22) | |||||||||
| Loss on disposal or impairment of assets | 16 | 10 | |||||||||
| Stock-based compensation expense | 42 | 33 | |||||||||
Provision for credit losses | 10 | 2 | |||||||||
Foreign exchange (gain) loss | (17) | 15 | |||||||||
| Deferred income taxes | (16) | 5 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | 69 | (129) | |||||||||
| Other assets | (28) | (64) | |||||||||
| Accounts payable | (30) | 62 | |||||||||
| Other liabilities | (113) | 384 | |||||||||
Net cash generated from operating activities | 2,289 | 2,221 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (1,020) | (692) | |||||||||
| Proceeds from disposal of property and equipment | 1 | 3 | |||||||||
| Acquisition of intangible assets and other | (10) | (236) | |||||||||
Net cash used in investing activities | (1,029) | (925) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from exercise of stock options | 1 | 4 | |||||||||
| Tax withholding on vesting of equity awards | (4) | (1) | |||||||||
| Repurchase of common stock | (1,300) | — | |||||||||
| Dividends paid | (445) | (153) | |||||||||
| Proceeds from long-term debt | 1,748 | — | |||||||||
| Repayments of long-term debt | (1,979) | (1,803) | |||||||||
| Payments of financing costs | (21) | (32) | |||||||||
| Unsettled forward contract for purchase of noncontrolling interest | (103) | — | |||||||||
Capped call option contract | (50) | — | |||||||||
| Other | (28) | (25) | |||||||||
Net cash used in financing activities | (2,181) | (2,010) | |||||||||
| Effect of exchange rate on cash, cash equivalents and restricted cash and cash equivalents | 25 | (24) | |||||||||
Decrease in cash, cash equivalents and restricted cash and cash equivalents | (896) | (738) | |||||||||
| Cash, cash equivalents and restricted cash and cash equivalents at beginning of period | 5,229 | 6,436 | |||||||||
| Cash, cash equivalents and restricted cash and cash equivalents at end of period | $ | 4,333 | $ | 5,698 | |||||||
| Supplemental disclosure of cash flow information | |||||||||||
| Cash payments for interest, net of amounts capitalized | $ | 563 | $ | 670 | |||||||
| Cash payments for taxes, net of refunds | $ | 206 | $ | 144 | |||||||
Change in construction-related payables | $ | 210 | $ | (36) | |||||||
Excise tax accrued on repurchase of common stock | $ | 13 | $ | — | |||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1 — Organization and Business of Company
The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K of Las Vegas Sands Corp. (“LVSC”), a Nevada corporation, and its subsidiaries (collectively the “Company”) for the year ended December 31, 2023, and have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations; however, the Company believes the disclosures herein are adequate to make the information presented not misleading. In the opinion of management, all adjustments and normal recurring accruals considered necessary for a fair statement of the results for the interim period have been included. The interim results reflected in the unaudited condensed consolidated financial statements are not necessarily indicative of expected results for the full year.
Operations
Macao
From 2020 through the beginning of 2023, the Company’s operations in Macao were negatively impacted by the reduction in travel and tourism related to the COVID-19 pandemic. The Macao government’s policy regarding the management of COVID-19 and general travel restrictions was relaxed in late December 2022 and early January 2023. Since then, visitation to the Company’s Macao Integrated Resorts and operations has improved.
The Macao government announced total visitation from mainland China to Macao increased approximately 36.3% during the nine months ended September 30, 2024, as compared to the same period in 2023. The Macao government also announced gross gaming revenue increased approximately 31.3% during the nine months ended September 30, 2024, as compared to the same period in 2023.
Singapore
The Company’s operations in Singapore continued to be positive as travel and tourism spending increased, resulting from the elimination of all remaining COVID-19 border measures in February 2023.
Visitation to Marina Bay Sands continues to improve since the travel restrictions have been lifted. The Singapore Tourism Board (“STB”) announced total visitation to Singapore increased to approximately 12.6 million for the nine months ended September 30, 2024, from approximately 10.1 million for the same period in 2023.
Development Projects
Macao
As part of the gaming concession entered into by Venetian Macau Limited (“VML,” a subsidiary of Sands China Ltd., a majority-owned subsidiary of the Company) and the Macao government, VML has a financial commitment to spend 35.80 billion patacas (approximately $4.47 billion at exchange rates in effect on September 30, 2024) through 2032 on both capital and operating projects, including 33.36 billion patacas (approximately $4.17 billion at exchange rates in effect on September 30, 2024) in non-gaming projects that will also appeal to international visitors.
The Company continues work on Phase II of The Londoner Macao, which includes the renovation of the rooms in the Sheraton and Conrad hotel towers, an upgrade of the gaming areas and the addition of new attractions, dining, retail and entertainment offerings. The Londoner Grand casino opened on September 26, 2024. The Sheraton Grand Macao is being converted into the Londoner Grand hotel and will become Macao’s first Marriott international luxury collection hotel. As of September 30, 2024, approximately 300 newly renovated rooms and suites were available for occupancy at the Londoner Grand. These projects have a total estimated cost of $1.2 billion and are expected to be substantially completed in early 2025.
Singapore
In April 2019, the Company’s wholly owned subsidiary, Marina Bay Sands Pte. Ltd. (“MBS”) and the STB entered into a development agreement (the “Second Development Agreement”) pursuant to which MBS has agreed to construct a development (the “MBS Expansion Project”) on a land parcel adjacent to Marina Bay Sands.
8
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
The MBS Expansion Project will include a hotel tower with luxury rooms and suites, a rooftop attraction, premium gaming areas, convention and meeting facilities and a state-of-the-art live entertainment arena with approximately 15,000 seats.
The Company’s estimated total project cost is approximately $8.0 billion, inclusive of financing fees and interest, land premiums and the purchase of an additional 2,000 square meters of gaming area (the “Additional Gaming Area”), increasing Marina Bay Sands’ total approved gaming area to 17,000 square meters across the existing property and the MBS Expansion Project.
The Company has incurred approximately $1.3 billion as of September 30, 2024, inclusive of the payment made in 2019 for the lease of the parcels of land underlying the MBS Expansion Project site. The additional payment due to the Singapore government related to the Additional Gaming Area and changes to the MBS Expansion Project gross floor area allocation is estimated to be approximately $1.0 billion and anticipated to be paid in the first quarter of 2025.
On April 3, 2024, MBS and the STB entered into a letter agreement, which further extended the construction commencement deadline to July 8, 2025, and the construction completion deadline to July 8, 2029.
The Company will begin construction as soon as government approvals are received, with an estimated commencement date in June 2025. While the Company’s current estimate is that construction will be complete in June 2030 with an anticipated opening date in January 2031, any extension of the completion date beyond the July 2029 deadline is subject to the approval of the Singapore government.
The renovation of Towers 1 and 2 of Marina Bay Sands is now complete and has introduced world class suites and other luxury amenities at a cost of approximately $1.0 billion. The Company is continuing with the renovation of the Tower 3 hotel rooms into world class suites and other property changes at an estimated cost of approximately $750 million, with an expected completion by 2025. These renovations at Marina Bay Sands are substantially upgrading the overall guest experience for its premium customers, including new dining and retail experiences, and upgrading the casino floor, among other things. These projects are in addition to the MBS Expansion Project.
New York
On June 2, 2023, the Company acquired the Nassau Veterans Memorial Coliseum (the “Nassau Coliseum”) from Nassau Live Center, LLC and related entities, which included the right to lease the underlying land from the County of Nassau (the “County”) in the State of New York (the “Nassau Coliseum Transaction”). The Company purchased the Nassau Coliseum with the intent to obtain a casino license from the State of New York to develop and operate an Integrated Resort. There is no assurance the Company will be able to obtain such casino license. Refer to “Note 7 — Leases” for further details.
Recent Accounting Pronouncements
The Company’s management has evaluated the accounting standards that have been recently issued, but not yet effective, or those proposed by the Financial Accounting Standards Board (“FASB”) or other standards-setting bodies through the filing date of these financial statements and does not believe the future adoption of any such pronouncements will have a material effect on the Company’s financial position, results of operations and cash flows.
9
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 2 — Accounts Receivable, Net and Customer Contract Related Liabilities
Accounts Receivable and Provision for Credit Losses
Accounts receivable consists of the following:
| September 30, 2024 | December 31, 2023 | ||||||||||
| (In millions) | |||||||||||
Casino | $ | 493 | $ | 483 | |||||||
Rooms | 32 | 33 | |||||||||
Mall | 32 | 126 | |||||||||
Other | 47 | 43 | |||||||||
| 604 | 685 | ||||||||||
Less - provision for credit losses | (191) | (201) | |||||||||
| $ | 413 | $ | 484 | ||||||||
The following table shows the movement in the provision for credit losses recognized for accounts receivable:
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Balance at January 1 | $ | 201 | $ | 217 | |||||||
Current period provision for credit losses | 10 | 2 | |||||||||
| Write-offs | (23) | (16) | |||||||||
Recoveries of receivables previously written-off | 1 | — | |||||||||
Exchange rate impact | 2 | (3) | |||||||||
Balance at September 30 | $ | 191 | $ | 200 | |||||||
Customer Contract Related Liabilities
The Company provides numerous products and services to its patrons. There is often a timing difference between the cash payment by the patrons and recognition of revenue for each of the associated performance obligations. The Company has the following main types of liabilities associated with contracts with customers: (1) outstanding chip liability, (2) loyalty program liability and (3) customer deposits and other deferred revenue for gaming and non-gaming products and services yet to be provided.
The following table summarizes the liability activity related to contracts with customers:
| Outstanding Chip Liability | Loyalty Program Liability | Customer Deposits and Other Deferred Revenue(1) | |||||||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||||||||
| Balance at January 1 | $ | 135 | $ | 81 | $ | 45 | $ | 72 | $ | 690 | $ | 614 | |||||||||||||||||||||||
Balance at September 30 | 129 | 130 | 39 | 65 | 780 | 711 | |||||||||||||||||||||||||||||
| Increase (decrease) | $ | (6) | $ | 49 | $ | (6) | $ | (7) | $ | 90 | $ | 97 | |||||||||||||||||||||||
____________________
(1)Of this amount, $174 million and $167 million as of September 30 and January 1, 2024, respectively, and $160 million and $149 million as of September 30 and January 1, 2023, respectively, related to mall deposits that are accounted for based on lease terms usually greater than one year.
10
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 3 — Long-Term Debt
Long-term debt consists of the following:
| September 30, 2024 | December 31, 2023 | ||||||||||
| (In millions) | |||||||||||
Corporate and U.S. Related(1): | |||||||||||
3.200% Senior Notes due 2024 (net of unamortized original issue discount and deferred financing costs of $2) | $ | — | $ | 1,748 | |||||||
2.900% Senior Notes due 2025 (net of unamortized original issue discount and deferred financing costs of $1) | 499 | 499 | |||||||||
3.500% Senior Notes due 2026 (net of unamortized original issue discount and deferred financing costs of $4 and $5, respectively) | 996 | 995 | |||||||||
5.900% Senior Notes due 2027 (net of unamortized original issue discount and deferred financing costs of $5) | 745 | — | |||||||||
6.000% Senior Notes due 2029 (net of unamortized original issue discount and deferred financing costs of $5) | 495 | — | |||||||||
3.900% Senior Notes due 2029 (net of unamortized original issue discount and deferred financing costs of $5 and $6, respectively) | 745 | 744 | |||||||||
6.200% Senior Notes due 2034 (net of unamortized original issue discount and deferred financing costs of $5) | 495 | — | |||||||||
Other(2) | 115 | — | |||||||||
Macao Related(1): | |||||||||||
5.125% Senior Notes due 2025 (net of unamortized original issue discount and deferred financing costs of $2 and $4, respectively) | 1,623 | 1,796 | |||||||||
3.800% Senior Notes due 2026 (net of unamortized original issue discount and deferred financing costs of $2 and $4, respectively) | 798 | 796 | |||||||||
2.300% Senior Notes due 2027 (net of unamortized original issue discount and deferred financing costs of $4 and $5, respectively) | 696 | 695 | |||||||||
5.400% Senior Notes due 2028 (net of unamortized original issue discount and deferred financing costs of $10 and $11, respectively) | 1,890 | 1,889 | |||||||||
2.850% Senior Notes due 2029 (net of unamortized original issue discount and deferred financing costs of $5) | 645 | 645 | |||||||||
4.375% Senior Notes due 2030 (net of unamortized original issue discount and deferred financing costs of $6 and $7, respectively) | 694 | 693 | |||||||||
3.250% Senior Notes due 2031 (net of unamortized original issue discount and deferred financing costs of $4 and $5) | 596 | 595 | |||||||||
Other(2) | 15 | 19 | |||||||||
Singapore Related(1): | |||||||||||
2012 Singapore Credit Facility — Term (net of unamortized deferred financing costs of $16 and $24, respectively) | 2,914 | 2,867 | |||||||||
| 2012 Singapore Delayed Draw Term Facility | 49 | 47 | |||||||||
| Other | 2 | 1 | |||||||||
| 14,012 | 14,029 | ||||||||||
| Less — current maturities | (2,728) | (1,900) | |||||||||
| Total long-term debt | $ | 11,284 | $ | 12,129 | |||||||
____________________
(1)Unamortized deferred financing costs of $43 million and $59 million as of September 30, 2024 and December 31, 2023, respectively, related to the Company’s revolving credit facilities and the undrawn portion of the Singapore Delayed Draw Term Facility, are included in “Other assets, net,” and “Prepaid expenses and other” in the accompanying condensed consolidated balance sheets.
11
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
(2)Includes finance leases related to the U.S. of $115 million and Macao of $15 million as of September 30, 2024, and related to Macao of $18 million as of December 31, 2023.
LVSC Senior Notes
On May 16, 2024, LVSC issued, in an underwritten public offering, three series of senior unsecured notes in an aggregate principal amount of $1.75 billion, consisting of $750 million of 5.900% Senior Notes due June 1, 2027 (the “2027 LVSC Senior Notes”), $500 million of 6.000% Senior Notes due August 15, 2029 (the “2029 LVSC Senior Notes”) and $500 million of 6.200% Senior Notes due August 15, 2034 (the “2034 LVSC Senior Notes” and, together with the 2027 LVSC Senior Notes and the 2029 LVSC Senior Notes, the “LVSC Senior Notes”). There are no interim principal payments on the LVSC Senior Notes and interest is payable semi-annually in arrears on December 1 and June 1, commencing on December 1, 2024, with respect to the 2027 LVSC Senior Notes and on February 15 and August 15, commencing on February 15, 2025, with respect to the 2029 LVSC Senior Notes and the 2034 LVSC Senior Notes.
The LVSC Senior Notes are senior unsecured obligations of LVSC. Each series of LVSC Senior Notes rank equally in right of payment with all of LVSC’s other unsecured and unsubordinated obligations, if any. None of LVSC’s subsidiaries guarantee the LVSC Senior Notes.
The LVSC Senior Notes were issued pursuant to supplemental indentures, dated May 16, 2024 (the “Supplemental Indentures”), between LVSC and U.S. Bank Trust Company, National Association, as trustee. The Supplemental Indentures contain covenants, subject to customary exceptions and qualifications, that limit the ability of LVSC and its subsidiaries to, among other things, incur liens, enter into sale and leaseback transactions and consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets on a consolidated basis. The Supplemental Indentures also provide for customary events of default.
The net proceeds from the offering and cash on hand were used to redeem in full the outstanding principal amount of the $1.75 billion 3.200% Senior Notes due August 8, 2024 (the “2024 LVSC Senior Notes”) and any accrued interest. As a result, the Company recorded a $1 million loss on early retirement of debt during the three months ended June 30, 2024.
LVSC Revolving Facility
On April 3, 2024, LVSC entered into a new revolving credit agreement, as further described below, and upon entering into the new agreement, the then-existing LVSC Revolving Credit Agreement was terminated.
2024 LVSC Revolving Facility
On April 3, 2024, LVSC entered into a revolving credit agreement with the arrangers and lenders named therein and The Bank of Nova Scotia, as administrative agent for the lenders (the “2024 LVSC Revolving Credit Agreement”), pursuant to which the lenders provided unsecured, revolving credit commitments to LVSC in an aggregate principal amount of $1.50 billion (the “2024 LVSC Revolving Facility”), which are available until April 3, 2029, and include a $150 million sub-facility for letters of credit. LVSC may utilize the proceeds of the loans for general corporate purposes and working capital requirements of LVSC and its subsidiaries and any other purpose not prohibited by the 2024 LVSC Revolving Credit Agreement. As of September 30, 2024, the Company had $1.50 billion of available borrowing capacity under the 2024 LVSC Revolving Facility, net of outstanding letters of credit.
The loans made under the 2024 LVSC Revolving Credit Agreement will bear interest at either, at LVSC’s option, (x) an adjusted Secured Overnight Financing Rate (“SOFR”), plus an applicable margin ranging from 1.125% to 1.550% per annum, or (y) at an alternate base rate, plus an applicable margin ranging from 0.125% to 0.550% per annum, in each case, depending on LVSC’s corporate family credit rating. Under the 2024 LVSC Revolving Credit Agreement, LVSC must pay a commitment fee quarterly in arrears on the undrawn portion of the revolving commitments, which commitment fee ranges from 0.125% to 0.250% per annum, depending on LVSC’s corporate family credit rating.
The 2024 LVSC Revolving Credit Agreement contains customary affirmative and negative covenants, in each case, subject to customary exceptions and thresholds, including a financial covenant limiting LVSC and its Restricted Subsidiaries (as defined in the agreement) to a maximum consolidated net leverage ratio of 4.0x as of the last day of each fiscal quarter. The negative covenants include, among other things, limitations on (i) the incurrence of liens on the assets of LVSC and its Restricted Subsidiaries, (ii) the incurrence of indebtedness by the Restricted Subsidiaries, (iii) the merger, consolidation or liquidation of LVSC or the sale of all or substantially all of LVSC’s assets and (iv) investments in subsidiaries of LVSC that are not Restricted Subsidiaries.
12
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
The 2024 LVSC Revolving Credit Agreement also contains customary events of default, including payment defaults, cross defaults to material debt, bankruptcy and insolvency, breaches of covenants and inaccuracy of representations and warranties, in each case subject to customary grace periods. In the case of a continuing event of default, the majority of lenders would be entitled to exercise various remedies, including the termination of any unused commitments and acceleration of any then-outstanding amounts due under the 2024 LVSC Revolving Credit Agreement.
SCL Senior Notes
During the three months ended June 30, 2024, Sands China Ltd. (“SCL”) repurchased $175 million of the outstanding principal amount of $1.80 billion of its 5.125% Senior Notes due August 8, 2025 (“2025 SCL Senior Notes”), resulting in a gain on early retirement of debt of approximately $1 million. As of September 30, 2024, the 2025 SCL Senior Notes had a remaining aggregate principal amount of $1.63 billion.
On February 1, 2024, Fitch upgraded the credit rating for the Company and SCL to BBB-. As a result of the upgrade, the coupon on each series of the outstanding SCL senior notes decreased by 0.25% per annum effective on the first interest payment date after February 1, 2024.
2018 SCL Credit Facility
As of September 30, 2024, SCL had $2.51 billion of available borrowing capacity under the 2018 SCL Revolving Facility comprised of Hong Kong dollar (“HKD”) commitments of HKD 17.63 billion (approximately $2.27 billion at exchange rates in effect on September 30, 2024) and U.S. dollar commitments of $237 million.
On October 23, 2024, SCL entered into a new credit facility, as further described below, and upon entering into the new agreement, the then-existing 2018 SCL Credit Facility was terminated.
2024 SCL Credit Facility
On October 23, 2024, SCL entered into a new facility agreement (the “2024 SCL Credit Facility”) with the arrangers and lenders named therein and Bank of China Limited, Macau Branch, as agent for the lenders. The 2024 SCL Credit Facility provides for a 19.50 billion Hong Kong dollars (“HKD,” approximately $2.51 billion at exchange rates in effect on September 30, 2024) unsecured revolving credit facility (the “2024 SCL Revolving Facility”). SCL may draw revolving loans under the 2024 SCL Revolving Facility from time to time until September 24, 2029 (or if that day is not a business day in Hong Kong or Macao, the next business day), for general corporate and working capital requirements of SCL and its subsidiaries, subject to certain restrictions set forth in the 2024 SCL Credit Facility. The final maturity date of all loans drawn under the 2024 SCL Revolving Facility is October 23, 2029.
The 2024 SCL Credit Facility also makes available an HKD 12.95 billion (approximately $1.67 billion at exchange rates in effect on September 30, 2024) unsecured term loan facility (the “2024 SCL Term Loan Facility”). SCL may make a drawdown under the 2024 SCL Term Loan Facility at any time until August 31, 2025, for the purpose of repaying amounts outstanding under its unsecured 5.125% Senior Notes due August 2025. The final maturity date of such loan drawn under the 2024 SCL Term Loan Facility is the date falling on the fifth anniversary of the date on which such loan is drawn.
Loans under the 2024 SCL Credit Facility will bear interest calculated by reference to the Hong Kong interbank offered rate plus a margin that is, in the case of the 2024 SCL Revolving Facility, determined by reference to the consolidated leverage ratio as defined therein. The initial margin for revolving loans drawn under the 2024 SCL Revolving Facility is 2.50% per annum. The margin for the term loan drawn under the 2024 SCL Term Loan Facility is 1.65% per annum. SCL is also required to pay a commitment fee of 0.60% per annum on the undrawn amounts under the 2024 SCL Credit Facility and other customary fees.
The 2024 SCL Credit Facility contains affirmative and negative covenants customary for similar unsecured financings, including, but not limited to, limitations on indebtedness secured by liens on principal properties, sale and leaseback transactions, dividend restrictions and restrictions on the repayment of the LVS term loan unless after such payments, SCL’s cash balance is not less than $250 million. The 2024 SCL Credit Facility also requires SCL to maintain a maximum ratio of total indebtedness to adjusted EBITDA of 4.00x throughout the life of the facility and a minimum ratio of adjusted EBITDA to net interest expense (including capitalized interest) of 2.50x throughout the life of the facility.
The 2024 SCL Credit Facility also contains certain events of default (some of which are subject to grace and remedy periods and materiality qualifiers), including, but not limited to, events relating to the gaming operations of SCL and its subsidiaries and the loss or termination of certain land concession contracts.
13
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
2012 Singapore Credit Facility
As of September 30, 2024, MBS had SGD 589 million (approximately $460 million at exchange rates in effect on September 30, 2024) of available borrowing capacity under the 2012 Singapore Revolving Facility, net of outstanding letters of credit, primarily consisting of a banker’s guarantee for SGD 153 million (approximately $120 million at exchange rates in effect on September 30, 2024) pursuant to the Second Development Agreement.
As of September 30, 2024, there was SGD 3.69 billion (approximately $2.88 billion at exchange rates in effect on September 30, 2024) of available borrowing capacity under the Singapore Delayed Draw Term Facility, which is only available to be drawn after the construction cost estimate and construction schedule for the MBS Expansion Project are delivered to lenders. The Company does not anticipate material spend related to the MBS Expansion Project prior to the delivery of these items to the lenders.
Debt Covenant Compliance
As of September 30, 2024, management believes the Company was in compliance with all debt covenants.
Cash Flows from Financing Activities
Cash flows from financing activities related to long-term debt and finance lease obligations are as follows:
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Proceeds from LVSC Senior Notes | $ | 1,748 | $ | — | |||||||
| $ | 1,748 | $ | — | ||||||||
Repayment on 2024 LVSC Senior Notes | $ | (1,750) | $ | — | |||||||
Repurchase of 2025 SCL Senior Notes | (174) | — | |||||||||
| Repayments on 2018 SCL Credit Facility | — | (1,698) | |||||||||
| Repayments on 2012 Singapore Credit Facility | (47) | (46) | |||||||||
| Repayments on Other Long-Term Debt | (8) | (59) | |||||||||
| $ | (1,979) | $ | (1,803) | ||||||||
Note 4 — Derivative Instruments
During the year ended December 31, 2021, the Company entered into a foreign currency swap agreement, which was designated as a hedge of the cash flows related to a portion of the 2025 SCL Senior Notes. During the nine months ended September 30, 2024, the Company entered into additional foreign currency swap agreements, which were designated as hedges of the cash flows related to portions of the 2026, 2027, 2028, 2029, 2030 and 2031 SCL Senior Notes (together with the foreign currency swap agreement entered into in December 2021, the “FX Swaps”). The FX Swaps have a total notional value of $5.01 billion and expire in line with the maturity dates of the underlying SCL Senior Notes. The objective of these agreements is to manage the risk of changes in cash flows resulting from foreign currency gains/losses realized upon remeasurement of U.S. dollar denominated SCL Senior Notes by swapping a specified amount of Hong Kong dollars for U.S. dollars at the contractual spot rate.
As of September 30, 2024, the total fair value of the FX Swaps is recorded as a liability in “Other long-term liabilities,” with the current portion recorded in “Other accrued liabilities,” in the accompanying condensed consolidated balance sheets. Changes to the fair value of the FX Swaps, including the impact of the remeasurement of the portion of the SCL Senior Notes being hedged, were recognized in “Accumulated other comprehensive income (loss)” in the accompanying condensed consolidated balance sheets and in “Cash flow hedge fair value adjustment” in the accompanying condensed consolidated statements of comprehensive income (loss). The cash flow impact of the Company’s derivative instruments is included in operating activities in the accompanying condensed consolidated statements of cash flows. Refer to “Note 8 — Fair Value Disclosures” for further details.
14
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 5 — Equity and Earnings Per Share
Common Stock
Dividends
On February 14, May 15 and August 14, 2024, the Company paid a quarterly dividend of $0.20 per common share as part of a regular cash dividend program. During the nine months ended September 30, 2024, the Company recorded $446 million as a distribution against retained earnings.
In October 2024, the Company’s Board of Directors declared a quarterly dividend of $0.20 per common share (a total estimated to be approximately $145 million) to be paid on November 13, 2024, to stockholders of record on November 5, 2024.
Share Repurchases
During the nine months ended September 30, 2024, the Company repurchased 28,746,681 shares of its common stock for approximately $1.31 billion (including commissions and $13 million in excise tax) under the Company’s current share repurchase program. During the nine months ended September 30, 2023, no shares of its common stock were repurchased. Subsequently, on October 22, 2024, the Company’s Board of Directors authorized increasing the remaining share repurchase amount from $195 million to $2.0 billion and extending the share repurchase program’s expiration date to November 3, 2026.
As part of the Company’s current share repurchase program, on September 5, 2024, the Company entered into a capped call option contract (“Capped Call”), pursuant to which the Company purchased capped call options on 1,336,210 shares of the Company’s common stock with a $0 strike price and a cap price of $39.02. The Capped Call will expire on October 31, 2024 and can result in the receipt of cash or shares. Shares acquired through the exercise of the call options will be included in treasury stock. The Capped Call is not considered a derivative instrument as the contract is indexed to the Company’s common stock and is therefore classified within stockholders’ equity. As of September 30, 2024, the $50 million premium payment was included as a reduction to additional paid-in capital in the accompanying condensed consolidated statement of equity.
All share repurchases of the Company's common stock have been recorded as treasury stock in the accompanying condensed consolidated balance sheets. Repurchases of the Company's common stock are made at the Company's discretion in accordance with applicable federal securities laws in the open market or otherwise. The timing, method and actual number of shares to be repurchased in the future will depend on a variety of factors, including the Company's financial position, earnings, legal requirements, other investment opportunities and market conditions.
Noncontrolling Interests in SCL
Purchase of Noncontrolling Interest
On December 5, 2023, the Company’s wholly owned subsidiary, Venetian Venture Development II (“VVDI II”), entered into a Master Confirmation and Supplemental Confirmation (collectively, the “Forward Purchase Agreement”) with a financial institution (the “Dealer”) relating to the purchase of the common stock of SCL (the “Forward Purchase Transaction”).
On April 16, 2024, the Dealer exercised its acceleration option under the Forward Purchase Agreement and, on April 18, 2024, delivered 90,467,099 shares of SCL common stock to the Company, representing an average price of HKD 21.57 per share. The additional shares delivered resulted in an increase of the Company’s ownership of SCL to approximately 71.02%.
Prepayment to Purchase Noncontrolling Interest
On September 9, 2024, VVDI II entered into an additional Master Confirmation and Supplemental Confirmation (collectively, the “Second Forward Purchase Agreement”) with the Dealer relating to the purchase of the common stock of SCL (the “Second Forward Purchase Transaction”).
Pursuant to the terms of the Second Forward Purchase Agreement, VVDI II made an up-front payment of HKD 800 million (approximately $103 million at exchange rates as of the date of the transaction) to the Dealer on September 9, 2024 (the “Maximum Notional Amount”), and the Dealer agreed to deliver to VVDI II shares of SCL’s common stock in an amount up to the Maximum Notional Amount upon completion. The Maximum Notional Amount was subject to reduction to
15
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
the extent the share price of SCL’s common stock exceeds a cap amount set forth in the Second Forward Purchase Agreement (the “Cap Amount”). Once the up-front payment was made, VVDI II had no further obligation to provide any additional consideration to the Dealer.
The number of shares actually delivered to the Company by the Dealer was based on the volume-weighted average share price of SCL’s common stock during the term of the Second Forward Purchase Transaction subject to the Cap Amount, less an agreed discount. All purchases under the Second Forward Purchase Transaction were completed by October 22, 2024, with a settlement date of October 28, 2024, when the Dealer will deliver approximately 23 million shares of SCL common stock to the Company, representing an average price of HKD 14.64 per share. The additional shares will result in an increase of the Company’s ownership of SCL to approximately 71.31%. Due to the Second Forward Purchase Transaction reaching the Cap Amount during the term of the agreement, approximately $59 million in unused portions of the Maximum Notional Amount will be returned to VVDI II in the form of cash.
As of September 30, 2024, the Company accounted for the Second Forward Purchase Agreement as a hybrid instrument consisting of a host contract, the prepayment amount of $103 million, accounted for as a reduction to equity, and an embedded derivative with nominal fair value. As the embedded derivative had a nominal fair value, no derivative was recorded.
Transfer from Noncontrolling Interest
The following table summarizes the net income attributable to LVSC and transfers from the noncontrolling interest, which shows the effects of changes in the Company’s ownership interest in a subsidiary on the equity attributable to the Company for the three and nine months ended September 30, 2024:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| Net income attributable to LVSC | $ | 275 | $ | 380 | $ | 1,122 | $ | 839 | |||||||||||||||
Transfer from noncontrolling interest: | |||||||||||||||||||||||
Increase in LVSC’s paid-in-capital for purchase of subsidiary shares | — | — | 3 | — | |||||||||||||||||||
| Changes from net income attributable to LVSC and transfers from noncontrolling interest | $ | 275 | $ | 380 | $ | 1,125 | $ | 839 | |||||||||||||||
Earnings Per Share
The weighted average number of common and common equivalent shares used in the calculation of basic and diluted earnings per share consisted of the following:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
Weighted-average common shares outstanding (used in the calculation of basic earnings per share) | 730 | 764 | 740 | 764 | |||||||||||||||||||
Potential dilution from stock options and restricted stock and stock units | 1 | 2 | 2 | 3 | |||||||||||||||||||
Weighted-average common and common equivalent shares (used in the calculation of diluted earnings per share) | 731 | 766 | 742 | 767 | |||||||||||||||||||
Antidilutive stock options excluded from the calculation of diluted earnings per share | 10 | 5 | 10 | 3 | |||||||||||||||||||
16
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 6 — Income Taxes
The Company’s effective income tax rate was 9.3% for the nine months ended September 30, 2024, compared to 18.7% for the nine months ended September 30, 2023. The effective income tax rate for the nine months ended September 30, 2024, reflects a 17% statutory tax rate on the Company’s Singapore operations, a 21% corporate income tax rate on its domestic operations, and a zero percent tax rate on its Macao gaming operations due to the Company’s income tax exemption in Macao.
On February 5, 2024, the Macao government provided notice that VML and its peers received an exemption from Macao’s corporate income tax on profits generated by the operation of casino games of chance for the period from January 1, 2023 through December 31, 2027.
Additionally, on February 7, 2024, the Company entered into a shareholder dividend tax agreement with the Macao government, effective for the period from January 1, 2023 through December 31, 2025, providing for an annual payment at an applicable rate of gross gaming revenue as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits. For the year ended December 31, 2023, income tax expense included an anticipated $57 million shareholder dividend tax based on the information available at the balance sheet date. During the three months ended March 31, 2024, the Company reversed the $57 million of income tax expense and recorded $10 million to corporate expense related to the year ended December 31, 2023, to reflect the terms of the new shareholder dividend tax agreement.
In accordance with interim accounting guidance, the Company calculated an estimated annual effective tax rate based on expected annual income and statutory rates in the jurisdictions in which the Company operates. This estimated annual effective tax rate is applied to actual year-to-date operating results to determine the provision for income taxes.
Note 7 — Leases
Lessee
The Company has operating and finance leases for various real estate (including leasehold interests in land) and equipment. Certain of these lease agreements include rental payments adjusted periodically for inflation, rental payments based on usage and rental payments contingent on certain events occurring. Certain of the Company’s leases include options to extend the lease term by one month to 10 years. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Nassau Coliseum
In conjunction with the Nassau Coliseum Transaction, the seller assigned their lease of the land on which the related assets, including the Nassau Coliseum and other improvements, are affixed (the “Original Lease”) to the Company. Immediately following this assignment, the Company entered into a new land lease agreement with the County, for the use and exclusive right to develop and operate assets on the land (the “New Lease”), which commenced on June 2, 2023.
On April 18, 2023, Hofstra University (“Hofstra”) filed a petition against the Nassau County Planning Commission (the “Planning Commission”) in the New York Supreme Court, County of Nassau, asserting, among other things, that certain meetings held by the Planning Commission concerning the New Lease and certain related transactions were not properly noticed and/or held, and that appropriate materials concerning the meetings were not made available to the public by the Planning Commission in connection with the meetings. On May 31, 2023, Hofstra filed an amended petition that, among other things, added additional respondents and sought to invalidate certain votes held by the County and the Nassau County Legislature. The Company is not a party to these proceedings.
In a decision and order dated November 9, 2023, the New York Supreme Court annulled various votes held by the Nassau County Legislature, annulled the New Lease and remitted the matter to the Planning Commission and the Nassau County Legislature to conduct a proper public hearing in accordance with all relevant statutes and rules, including the Nassau County Administrative Code and the Open Meetings law and for the issuance of a positive declaration pursuant to the New York State Environmental Quality Review Act and for the preparation of an Environmental Impact Statement. On November 10, 2023, the respondents appealed the decision and order and on November 21, 2023, Hofstra cross-appealed. On December 13, 2023, the Appellate Division: Second Judicial Department denied respondents’ motion to stay enforcement of the decision and order pending the appeal, but granted a calendar preference, indicating that the appeal will be calendared expeditiously after all briefs have been filed. With the invalidation of the New Lease noted above, the Company believed it
17
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
had become the lessee in the Original Lease. This was accounted for as a lease modification on December 14, 2023. Prior to the invalidation of the New Lease, the Company made the required lease payments, including a one-time rent payment of $54 million. On January 29, 2024, Hofstra filed a motion seeking a declaration that the Court’s prior order included the annulment of Nassau County’s consent and the putative assignment to the Company of the Original Lease.
On February 23, 2024, the New York State Supreme Court ruled the Original Lease had been terminated and the Company currently had no leasehold interest in the land upon which the Nassau Coliseum sits. On February 27, 2024, the respondents appealed the decision, order and interlocutory judgment. On March 29, 2024, the Appellate Division: Second Judicial Department denied respondents’ motion to stay enforcement of the decision, order and interlocutory judgment. Subsequent to this order, the Company entered into a use and occupancy permit (the “Permit”) with the County to allow the Company to continue operating the Nassau Coliseum for a nominal $1 fee. The Company considered the accounting guidance under ASC 842 and determined the Permit meets the definition of a lease as it conveys the right to control the use of the associated assets for a specified period of time. Consequently, the Original Lease was deemed to be modified, maintaining the operating lease classification.
On August 16, 2024, the Company entered into a lease agreement with the County for the use and exclusive right to operate assets on approximately 72 acres of land, including the Nassau Coliseum and other improvements thereon (the “Updated Lease”), which has a 42-year lease term (inclusive of three 5-year extensions). The Company is required to make annual rent payments in the amounts and at the times specified in the Updated Lease. As of September 30, 2024, the related right-of-use (“ROU”) asset and finance lease liability were $162 million and $115 million, respectively.
In the accompanying condensed consolidated balance sheet, the Updated Lease ROU asset is included in “Property and equipment, net” and the noncurrent portion of the related finance lease liability is included in “Long-term debt.”
The future minimum lease payments are $1 million for the three-month period ending December 31, 2024, and for each of the years ending December 31, 2025 and 2026, $3 million for the year ending December 31, 2027, $6 million for the year ending December 31, 2028, and $338 million thereafter.
Lessor
Lease revenue for the Company’s mall operations consists of the following:
| Three Months Ended September 30, | |||||||||||||||||||||||
| 2024 | 2023 | ||||||||||||||||||||||
Mall | Other | Mall | Other | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| Minimum rents | $ | 138 | $ | — | $ | 128 | $ | — | |||||||||||||||
| Overage rents | 26 | — | 48 | — | |||||||||||||||||||
| $ | 164 | $ | — | $ | 176 | $ | — | ||||||||||||||||
| Nine Months Ended September 30, | |||||||||||||||||||||||
| 2024 | 2023 | ||||||||||||||||||||||
| Mall | Other | Mall | Other | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| Minimum rents | $ | 406 | $ | 1 | $ | 372 | $ | 1 | |||||||||||||||
| Overage rents | 56 | — | 91 | — | |||||||||||||||||||
| $ | 462 | $ | 1 | $ | 463 | $ | 1 | ||||||||||||||||
18
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 8 — Fair Value Disclosures
The following table presents the carrying amounts and estimated fair values of financial instruments held or issued by the Company as of September 30, 2024 and December 31, 2023, using available market information. Determining fair value is judgmental in nature and requires market assumptions and/or estimation methodologies. The table excludes cash, restricted cash, accounts receivables, net, and accounts payable, all of which had fair values approximating their carrying amounts due to the short maturities and liquidity of these instruments.
| September 30, 2024 | |||||||||||||||||
| Hierarchy Level | |||||||||||||||||
Carrying Amount(1) | Level 1 | Level 2 | |||||||||||||||
| (in millions) | |||||||||||||||||
| Assets: | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Cash deposits | $ | 2,394 | $ | 2,394 | |||||||||||||
Money market funds | 190 | 190 | |||||||||||||||
| U.S. Treasury Bills | 700 | 700 | |||||||||||||||
Loan receivable(2) | 1,246 | $ | 1,201 | ||||||||||||||
| Liabilities: | |||||||||||||||||
Long-term debt(3)(4) | 13,954 | 13,723 | |||||||||||||||
Cross-currency swaps(3) | 40 | 40 | |||||||||||||||
| December 31, 2023 | |||||||||||||||||
| Hierarchy Level | |||||||||||||||||
Carrying Amount(1) | Level 1 | Level 2 | |||||||||||||||
| (in millions) | |||||||||||||||||
| Assets: | |||||||||||||||||
Cash equivalents | |||||||||||||||||
Cash deposits | $ | 2,153 | $ | 2,153 | |||||||||||||
Money market funds | 52 | 52 | |||||||||||||||
U.S. Treasury Bills | 1,124 | 1,124 | |||||||||||||||
Loan receivable(2) | 1,194 | $ | 1,130 | ||||||||||||||
| Liabilities: | |||||||||||||||||
Long-term debt(3)(4) | 14,090 | 13,526 | |||||||||||||||
Cross-currency swaps(3) | 3 | 3 | |||||||||||||||
____________________
(1)The cross-currency swaps are accounted for at fair value in the accompanying condensed consolidated financial statements. The other items included in this table are not accounted for at fair value.
(2)The fair value is estimated based on level 2 inputs and reflects the increase in market interest rates since finalizing the terms of the loan receivable at a fixed interest rate on March 2, 2021.
(3)The estimated fair value is based on recent trades, if available, and indicative pricing from market information (level 2 inputs).
(4)The carrying amount of long-term debt is exclusive of finance leases and represents its contractual value.
19
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 9 — Commitments and Contingencies
Litigation
The Company is involved in other litigation in addition to those noted below, arising in the normal course of business. Management has made certain estimates for potential litigation costs based upon consultation with legal counsel. Actual results could differ from these estimates; however, in the opinion of management, such litigation and claims will not have a material effect on the Company’s financial condition, results of operations and cash flows.
Asian American Entertainment Corporation, Limited v. Venetian Macau Limited, et al.
On January 19, 2012, Asian American Entertainment Corporation, Limited (“AAEC” or “Plaintiff”) filed a claim with the Macao First Instance Court against VML, LVS (Nevada) International Holdings, Inc. (“LVS (Nevada)”), Las Vegas Sands, LLC (“LVSLLC”) and Venetian Casino Resort (“VCR”) (collectively, the “Defendants”) for 3.0 billion patacas (approximately $375 million at exchange rates in effect on September 30, 2024), which alleges a breach of agreements entered into between AAEC and LVS (Nevada), LVSLLC and VCR (collectively, the “U.S. Defendants”) for their joint presentation of a bid in response to the public tender held by the Macao government for the award of gaming concessions at the end of 2001.
On March 24, 2014, the Macao First Instance Court issued a decision holding that AAEC’s claim against VML is unfounded and that VML be removed as a party to the proceedings. On May 8, 2014, AAEC lodged an appeal against that decision.
On June 5, 2015, the U.S. Defendants applied to the Macao First Instance Court to dismiss the claims against them as res judicata based on the dismissal of prior action in the United States that had alleged similar claims. On March 16, 2016, the Macao First Instance Court dismissed the defense of res judicata. An appeal against that decision was lodged by U.S. Defendants on April 7, 2016. At the end of December 2016, all the appeals were transferred to the Macao Second Instance Court.
Evidence gathering by the Macao First Instance Court commenced by letters rogatory, which was completed on March 14, 2019.
On July 15, 2019, AAEC submitted a request to the Macao First Instance Court to increase the amount of its claim to 96.45 billion patacas (approximately $12.05 billion at exchange rates in effect on September 30, 2024), allegedly representing lost profits from 2004 to 2018, and reserving its right to claim for lost profits up to 2022. On September 4, 2019, the Macao First Instance Court allowed AAEC’s amended request. The U.S. Defendants appealed the decision allowing the amended claim on September 17, 2019; the Macao First Instance Court accepted the appeal on September 26, 2019.
On April 16, 2021, the U.S. Defendants moved to reschedule the trial because of the ongoing COVID-19 pandemic. The Macao First Instance Court denied the U.S. Defendants’ motion on May 28, 2021. The U.S. Defendants appealed that ruling on June 16, 2021.
The trial began on June 16, 2021. By order dated June 17, 2021, the Macao First Instance Court scheduled additional trial dates in late 2021 to hear witnesses who were subject to COVID-19 travel restrictions that prevented or severely limited their ability to enter Macao. The U.S. Defendants appealed certain aspects of the Macao First Instance Court’s June 17, 2021 order.
On July 10, 2021, the U.S. Defendants were notified of an invoice for supplemental court fees totaling 93 million patacas (approximately $12 million at exchange rates in effect on September 30, 2024) based on Plaintiff’s July 15, 2019 amendment. By motion dated July 20, 2021, the U.S. Defendants moved for an order withdrawing that invoice. The Macao First Instance Court denied that motion by order dated September 11, 2021. The U.S. Defendants appealed that order on September 23, 2021. By order dated September 29, 2021, the Macao First Instance Court ordered that the invoice for supplemental court fees be stayed pending resolution of that appeal.
From December 17, 2021 to January 19, 2022, Plaintiff submitted additional documents to the court file and disclosed written reports from two purported experts, who calculated Plaintiff’s damages at 57.88 billion patacas and 62.29 billion patacas (approximately $7.23 billion and $7.78 billion, respectively, at exchange rates in effect on September 30, 2024). On April 28, 2022, the Macao First Instance Court entered a judgment for the U.S. Defendants. The Macao First Instance Court also held that Plaintiff litigated certain aspects of its case in bad faith.
20
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Plaintiff filed a notice of appeal from the Macao First Instance Court’s judgment on May 13, 2022.
On September 19, 2022, the U.S. Defendants were notified of an invoice for appeal court fees totaling 48 million patacas (approximately $6 million at exchange rates in effect on September 30, 2024). By motion dated September 29, 2022, the U.S. Defendants moved the Macao First Instance Court for an order withdrawing that invoice. The Macao First Instance Court denied that motion by order dated October 24, 2022. The U.S. Defendants appealed that order on November 10, 2022 and on January 6, 2023, submitted the appeal brief.
On October 9, 2023, the U.S. Defendants were notified that the Macao Second Instance Court had invited Plaintiff to amend its appeal brief, primarily to separate out matters of fact from matters of law, and Plaintiff had submitted an amended appeal brief on October 5, 2023. The U.S. Defendants responded to Plaintiff’s amended appeal brief on October 30, 2023. On November 8, 2023, the Macao Second Instance Court issued an order concluding that Plaintiff may have litigated in bad faith by exceeding the scope of permissible amendments to its appeal brief and invited responses from the parties. Plaintiff moved for clarification of the November 8 order on November 22, 2023, and the U.S. Defendants responded to the November 8 order on November 23, 2023. On January 5, 2024, the Macao Second Instance Court rejected Plaintiff’s request for clarification. This matter is currently pending the Macao Second Instance Court’s decision.
On October 17, 2024, the Macao Second Instance Court rejected Plaintiff's appeal on procedural grounds and found it unnecessary to hear the interlocutory appeals lodged by Plaintiff and by U.S. Defendants. The Macao Second Instance Court further decided that Plaintiff had litigated in bad faith. Plaintiff was notified of these decisions on October 21, 2024, and has until November 5, 2024 to file a notice of appeal from the Macao Second Instance Court’s decisions. The U.S. Defendants are currently evaluating the Macao Second Instance Court’s decision.
Management has determined that, based on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.
The Daniels Family 2001 Revocable Trust v. LVSC, et al.
On October 22, 2020, The Daniels Family 2001 Revocable Trust, a putative purchaser of the Company’s shares, filed a purported class action complaint in the U.S. District Court against LVSC, Sheldon G. Adelson and Patrick Dumont. The complaint asserts violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and alleges that LVSC made materially false or misleading statements, or failed to disclose material facts, from February 27, 2016 through September 15, 2020, with respect to its operations at Marina Bay Sands, its compliance with Singapore laws and regulations, and its disclosure controls and procedures.
On January 5, 2021, the U.S. District Court entered an order appointing Carl S. Ciaccio and Donald M. DeSalvo as lead plaintiffs (“Lead Plaintiffs”). On March 8, 2021, Lead Plaintiffs filed a purported class action amended complaint against LVSC, Sheldon G. Adelson, Patrick Dumont, and Robert G. Goldstein, alleging similar violations of Sections 10(b) and 20(a) of the Exchange Act over the same time period of February 27, 2016 through September 15, 2020. On March 22, 2021, the U.S. District Court granted Lead Plaintiffs’ motion to substitute Dr. Miriam Adelson, in her capacity as the Special Administrator for the estate of Sheldon G. Adelson, for Sheldon G. Adelson as a defendant in this action.
On May 7, 2021, the defendants filed a motion to dismiss the amended complaint, which on March 28, 2022, the U.S. District Court granted in its entirety. The U.S. District Court dismissed certain claims with prejudice, but granted Lead Plaintiffs leave to amend the complaint with respect to the other claims by April 18, 2022. On April 8, 2022, Lead Plaintiffs filed a motion for reconsideration and to extend time to file an Amended Complaint. The defendants filed an opposition to the motion on April 22, 2022.
On April 18, 2022, Lead Plaintiffs filed a second amended complaint. On May 18, 2022, the defendants filed a motion to dismiss the second amended complaint, and briefing was completed on July 8, 2022.
On August 8, 2023, the U.S. District Court denied Lead Plaintiffs’ motion for reconsideration, and granted in part and denied in part the defendants’ motion to dismiss the second amended complaint. The U.S. District Court dismissed Lead Plaintiffs’ allegations pertaining to the challenged statements that were made in 2016, 2017 and 2018, but allowed the allegations pertaining to the challenged statements from 2019 and 2020 to proceed. On August 22, 2023, the defendants filed a motion for partial reconsideration, requesting that the U.S. District Court reconsider its denial of the motion to dismiss with respect to the challenged statements from 2019 and 2020. If the motion for partial reconsideration is granted, this would result in dismissal of the second amended complaint. The defendants also moved, in the event the motion for partial
21
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
reconsideration is not granted, for certification for interlocutory appeal of the U.S. District Court’s order allowing the challenged statements from 2019 and 2020 to proceed. The defendants simultaneously filed a motion for a stay pending adjudication of the motion for reconsideration, which requests a stay of all discovery and case deadlines. Briefing on both motions was completed on September 12, 2023. On December 19, 2023, the U.S. District Court granted the defendants’ motion for partial reconsideration and, on January 2, 2024, entered an amended order granting the defendants’ motion to dismiss the second amended complaint in its entirety. The U.S. District Court also granted Lead Plaintiffs leave to file an amended complaint by January 18, 2024. In addition, in light of its granting the motion for partial reconsideration, the U.S. District Court denied the defendants’ motion for a stay of discovery and case deadlines as moot. On January 18, 2024, Lead Plaintiffs informed the defendants that they would not be filing an amended complaint.
On February 22, 2024, Lead Plaintiffs and the defendants filed a stipulation to dismiss Lead Plaintiffs’ claims with prejudice with each party bearing its own fees and costs. Based on the stipulation, the U.S. District Court dismissed the action with prejudice on February 26, 2024, and final judgment was entered in favor of the defendants on February 27, 2024. Lead Plaintiffs did not file a notice of appeal by the March 28, 2024 deadline and therefore, this matter is concluded.
Turesky v. Sheldon G. Adelson, et al.
On December 28, 2020, Andrew Turesky filed a putative shareholder derivative action on behalf of the Company in the U.S. District Court, against Sheldon G. Adelson, Patrick Dumont, Robert G. Goldstein, Irwin Chafetz, Micheline Chau, Charles D. Forman, Steven L. Gerard, George Jamieson, Charles A. Koppelman, Lewis Kramer and David F. Levi, all of whom are current or former directors and/or officers of LVSC. The complaint asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, abuse of control, gross mismanagement, violations of Sections 10(b), 14(a) and 20(a) of the Exchange Act and for contribution under Sections 10(b) and 21D of the Exchange Act. On February 24, 2021, the U.S. District Court entered an order granting the parties’ stipulation to stay this action in light of the Daniels Family 2001 Revocable Trust putative securities class action (the “Securities Action”). Subject to the terms of the parties’ stipulation, this action was stayed until 30 days after the final resolution of the motion to dismiss in the Securities Action. On March 11, 2021, the U.S. District Court granted the plaintiff’s motion to substitute Dr. Miriam Adelson, in her capacity as the Special Administrator for the estate of Sheldon G. Adelson, for Sheldon G. Adelson as a defendant in this action.
On January 2, 2024, the second amended complaint in the Securities Action was dismissed in its entirety, and the case was dismissed with prejudice on February 26, 2024. On February 27, 2024, the U.S. District Court lifted the stay in this action and ordered the parties to meet and confer and submit a proposed scheduling order by March 12, 2024. On March 8, 2024, the parties in this action filed a stipulation requesting that their deadline to submit the proposed scheduling order be extended to April 11, 2024, in order to know, before submitting the proposed scheduling order, whether the plaintiffs in the Securities Action would appeal by their deadline of March 28, 2024. The U.S. District Court granted the stipulation on March 13, 2024. The plaintiffs in the Securities Action did not file an appeal by the deadline. On April 9, 2024, the parties in this action filed a stipulation to dismiss the case in its entirety as to all defendants without prejudice, with each party bearing its own fees and costs. Based on the stipulation, the U.S. District Court dismissed this action without prejudice on April 10, 2024, and therefore, this matter is concluded.
22
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
Note 10 — Segment Information
The Company’s principal operating and developmental activities occur in two geographic areas: Macao and Singapore. The Company reviews the results of operations and construction and development activities for each of its operating segments: The Venetian Macao; The Londoner Macao; The Parisian Macao; The Plaza Macao and Four Seasons Macao; Sands Macao; and Marina Bay Sands. The Company also reviews construction and development activities for its primary projects under development, in addition to its reportable segments noted above. The Company has included Ferry Operations and Other (comprised primarily of the Company’s ferry operations and various other operations that are ancillary to its properties in Macao) and Corporate and Other to reconcile to the condensed consolidated results of operations and financial condition.
The Company’s segment information as of September 30, 2024 and December 31, 2023, and for the three and nine months ended September 30, 2024 and 2023 is as follows:
| Casino | Rooms | Food and Beverage | Mall | Convention, Retail and Other | Net Revenues | ||||||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, 2024 | |||||||||||||||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||||||||||||||
| The Venetian Macao | $ | 554 | $ | 54 | $ | 15 | $ | 59 | $ | 10 | $ | 692 | |||||||||||||||||||||||
| The Londoner Macao | 338 | 68 | 21 | 20 | 13 | 460 | |||||||||||||||||||||||||||||
| The Parisian Macao | 189 | 36 | 17 | 6 | 2 | 250 | |||||||||||||||||||||||||||||
| The Plaza Macao and Four Seasons Macao | 182 | 27 | 7 | 40 | 1 | 257 | |||||||||||||||||||||||||||||
| Sands Macao | 73 | 4 | 3 | 1 | — | 81 | |||||||||||||||||||||||||||||
| Ferry Operations and Other | — | — | — | — | 31 | 31 | |||||||||||||||||||||||||||||
| 1,336 | 189 | 63 | 126 | 57 | 1,771 | ||||||||||||||||||||||||||||||
| Marina Bay Sands | 600 | 125 | 89 | 63 | 42 | 919 | |||||||||||||||||||||||||||||
| Intercompany royalties | — | — | — | — | 60 | 60 | |||||||||||||||||||||||||||||
Intercompany eliminations(1) | — | — | — | — | (68) | (68) | |||||||||||||||||||||||||||||
| Total net revenues | $ | 1,936 | $ | 314 | $ | 152 | $ | 189 | $ | 91 | $ | 2,682 | |||||||||||||||||||||||
| Three Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||||||||||||||
| The Venetian Macao | $ | 575 | $ | 55 | $ | 17 | $ | 58 | $ | 18 | $ | 723 | |||||||||||||||||||||||
| The Londoner Macao | 371 | 97 | 25 | 17 | 8 | 518 | |||||||||||||||||||||||||||||
| The Parisian Macao | 181 | 37 | 15 | 7 | 4 | 244 | |||||||||||||||||||||||||||||
| The Plaza Macao and Four Seasons Macao | 108 | 24 | 7 | 50 | 3 | 192 | |||||||||||||||||||||||||||||
| Sands Macao | 75 | 4 | 3 | 1 | — | 83 | |||||||||||||||||||||||||||||
| Ferry Operations and Other | — | — | — | — | 29 | 29 | |||||||||||||||||||||||||||||
| 1,310 | 217 | 67 | 133 | 62 | 1,789 | ||||||||||||||||||||||||||||||
| Marina Bay Sands | 698 | 125 | 89 | 68 | 35 | 1,015 | |||||||||||||||||||||||||||||
| Intercompany royalties | — | — | — | — | 61 | 61 | |||||||||||||||||||||||||||||
Intercompany eliminations(1) | — | — | — | — | (70) | (70) | |||||||||||||||||||||||||||||
| Total net revenues | $ | 2,008 | $ | 342 | $ | 156 | $ | 201 | $ | 88 | $ | 2,795 | |||||||||||||||||||||||
23
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
| Casino | Rooms | Food and Beverage | Mall | Convention, Retail and Other | Net Revenues | ||||||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, 2024 | |||||||||||||||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||||||||||||||
| The Venetian Macao | $ | 1,748 | $ | 156 | $ | 48 | $ | 168 | $ | 29 | $ | 2,149 | |||||||||||||||||||||||
| The Londoner Macao | 1,075 | 234 | 70 | 53 | 34 | 1,466 | |||||||||||||||||||||||||||||
| The Parisian Macao | 569 | 102 | 48 | 20 | 6 | 745 | |||||||||||||||||||||||||||||
| The Plaza Macao and Four Seasons Macao | 430 | 77 | 23 | 116 | 3 | 649 | |||||||||||||||||||||||||||||
| Sands Macao | 212 | 13 | 9 | 1 | 1 | 236 | |||||||||||||||||||||||||||||
| Ferry Operations and Other | — | — | — | — | 91 | 91 | |||||||||||||||||||||||||||||
| 4,034 | 582 | 198 | 358 | 164 | 5,336 | ||||||||||||||||||||||||||||||
| Marina Bay Sands | 2,165 | 375 | 252 | 180 | 121 | 3,093 | |||||||||||||||||||||||||||||
| Intercompany royalties | — | — | — | — | 186 | 186 | |||||||||||||||||||||||||||||
Intercompany eliminations(1) | — | — | — | (1) | (212) | (213) | |||||||||||||||||||||||||||||
| Total net revenues | $ | 6,199 | $ | 957 | $ | 450 | $ | 537 | $ | 259 | $ | 8,402 | |||||||||||||||||||||||
| Nine Months Ended September 30, 2023 | |||||||||||||||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||||||||||||||
| The Venetian Macao | $ | 1,544 | $ | 142 | $ | 47 | $ | 162 | $ | 39 | $ | 1,934 | |||||||||||||||||||||||
| The Londoner Macao | 850 | 232 | 59 | 47 | 15 | 1,203 | |||||||||||||||||||||||||||||
| The Parisian Macao | 492 | 100 | 35 | 23 | 7 | 657 | |||||||||||||||||||||||||||||
| The Plaza Macao and Four Seasons Macao | 367 | 69 | 21 | 125 | 5 | 587 | |||||||||||||||||||||||||||||
| Sands Macao | 218 | 12 | 9 | 1 | 1 | 241 | |||||||||||||||||||||||||||||
| Ferry Operations and Other | — | — | — | — | 74 | 74 | |||||||||||||||||||||||||||||
| 3,471 | 555 | 171 | 358 | 141 | 4,696 | ||||||||||||||||||||||||||||||
| Marina Bay Sands | 1,940 | 326 | 252 | 178 | 92 | 2,788 | |||||||||||||||||||||||||||||
| Intercompany royalties | — | — | — | — | 164 | 164 | |||||||||||||||||||||||||||||
Intercompany eliminations(1) | — | — | — | (1) | (190) | (191) | |||||||||||||||||||||||||||||
| Total net revenues | $ | 5,411 | $ | 881 | $ | 423 | $ | 535 | $ | 207 | $ | 7,457 | |||||||||||||||||||||||
____________________
(1)Intercompany eliminations include royalties and other intercompany services.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| Intersegment Revenues | |||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||
| The Venetian Macao | $ | 1 | $ | 1 | $ | 5 | $ | 5 | |||||||||||||||
| Ferry Operations and Other | 7 | 6 | 20 | 18 | |||||||||||||||||||
| 8 | 7 | 25 | 23 | ||||||||||||||||||||
| Marina Bay Sands | — | 2 | 2 | 4 | |||||||||||||||||||
| Intercompany royalties | 60 | 61 | 186 | 164 | |||||||||||||||||||
| Total intersegment revenues | $ | 68 | $ | 70 | $ | 213 | $ | 191 | |||||||||||||||
24
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| Adjusted Property EBITDA | |||||||||||||||||||||||
| Macao: | |||||||||||||||||||||||
| The Venetian Macao | $ | 267 | $ | 290 | $ | 843 | $ | 752 | |||||||||||||||
| The Londoner Macao | 124 | 167 | 399 | 326 | |||||||||||||||||||
| The Parisian Macao | 74 | 81 | 228 | 201 | |||||||||||||||||||
| The Plaza Macao and Four Seasons Macao | 102 | 71 | 238 | 237 | |||||||||||||||||||
| Sands Macao | 14 | 17 | 36 | 42 | |||||||||||||||||||
| Ferry Operations and Other | 4 | 5 | 12 | 12 | |||||||||||||||||||
| 585 | 631 | 1,756 | 1,570 | ||||||||||||||||||||
| Marina Bay Sands | 406 | 491 | 1,515 | 1,317 | |||||||||||||||||||
Consolidated adjusted property EBITDA(1) | 991 | 1,122 | 3,271 | 2,887 | |||||||||||||||||||
| Other Operating Costs and Expenses | |||||||||||||||||||||||
Stock-based compensation(2) | (10) | (6) | (19) | (25) | |||||||||||||||||||
| Corporate | (68) | (49) | (215) | (166) | |||||||||||||||||||
| Pre-opening | (4) | (3) | (10) | (13) | |||||||||||||||||||
| Development | (55) | (44) | (169) | (140) | |||||||||||||||||||
| Depreciation and amortization | (324) | (313) | (960) | (875) | |||||||||||||||||||
| Amortization of leasehold interests in land | (15) | (15) | (45) | (43) | |||||||||||||||||||
| Loss on disposal or impairment of assets | (11) | (4) | (41) | (22) | |||||||||||||||||||
| Operating income | 504 | 688 | 1,812 | 1,603 | |||||||||||||||||||
| Other Non-Operating Costs and Expenses | |||||||||||||||||||||||
| Interest income | 67 | 79 | 218 | 225 | |||||||||||||||||||
| Interest expense, net of amounts capitalized | (179) | (200) | (547) | (628) | |||||||||||||||||||
Other income (expense) | 11 | 4 | 16 | (17) | |||||||||||||||||||
| Income tax expense | (50) | (122) | (139) | (221) | |||||||||||||||||||
Net income | $ | 353 | $ | 449 | $ | 1,360 | $ | 962 | |||||||||||||||
____________________
(1)Consolidated adjusted property EBITDA, which is a non-GAAP financial measure, is net income (loss) before stock-based compensation expense, corporate expense, pre-opening expense, development expense, depreciation and amortization, amortization of leasehold interests in land, gain or loss on disposal or impairment of assets, interest, other income or expense, gain or loss on modification or early retirement of debt and income taxes. Consolidated adjusted property EBITDA is a supplemental non-GAAP financial measure used by management, as well as industry analysts, to evaluate operations and operating performance. In particular, management utilizes consolidated adjusted property EBITDA to compare the operating profitability of its operations with those of its competitors, as well as a basis for determining certain incentive compensation. Integrated Resort companies, including LVSC, have historically reported adjusted property EBITDA as a supplemental performance measure to GAAP financial measures. In order to view the operations of their properties on a more stand-alone basis, Integrated Resort companies, including LVSC, have historically excluded certain expenses that do not relate to the management of specific properties, such as pre-opening expense, development expense and corporate expense, from their adjusted property EBITDA calculations. Consolidated adjusted property EBITDA should not be interpreted as an alternative to income from operations (as an indicator of operating performance) or to cash flows from operations (as a measure of liquidity), in each case, as determined in accordance with GAAP. The Company has significant uses of cash flow, including capital expenditures, dividend payments, interest payments, debt principal repayments and income taxes, which are not reflected in consolidated adjusted property EBITDA. Not all companies calculate adjusted property EBITDA in the same manner. As a result, consolidated adjusted property EBITDA as presented by the Company may not be directly comparable to similarly titled measures presented by other companies.
(2)During the three months ended September 30, 2024 and 2023, the Company recorded stock-based compensation expense of $24 million and $16 million, respectively, of which $14 million and $10 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations. During the nine months ended September 30, 2024 and 2023, the Company recorded stock-based compensation expense of $58 million and $58 million, respectively, of which $39 million and $33 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.
25
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Capital Expenditures | |||||||||||
| Corporate and Other | $ | 32 | $ | 168 | |||||||
| Macao: | |||||||||||
| The Venetian Macao | 155 | 44 | |||||||||
| The Londoner Macao | 348 | 66 | |||||||||
| The Parisian Macao | 11 | 3 | |||||||||
| The Plaza Macao and Four Seasons Macao | 9 | 8 | |||||||||
| Sands Macao | 10 | 3 | |||||||||
| Ferry Operations and Other | 1 | — | |||||||||
| 534 | 124 | ||||||||||
| Marina Bay Sands | 454 | 400 | |||||||||
| Total capital expenditures | $ | 1,020 | $ | 692 | |||||||
| September 30, 2024 | December 31, 2023 | ||||||||||
| (In millions) | |||||||||||
| Total Assets | |||||||||||
| Corporate and Other | $ | 3,875 | $ | 5,167 | |||||||
| Macao: | |||||||||||
| The Venetian Macao | 3,208 | 2,548 | |||||||||
| The Londoner Macao | 4,471 | 4,193 | |||||||||
| The Parisian Macao | 1,723 | 1,802 | |||||||||
| The Plaza Macao and Four Seasons Macao | 997 | 1,059 | |||||||||
| Sands Macao | 256 | 287 | |||||||||
| Ferry Operations and Other | 245 | 335 | |||||||||
| 10,900 | 10,224 | ||||||||||
| Marina Bay Sands | 6,579 | 6,387 | |||||||||
| Total assets | $ | 21,354 | $ | 21,778 | |||||||
26
LAS VEGAS SANDS CORP. AND SUBSIDIARIES
ITEM 2 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with, and is qualified in its entirety by, the condensed consolidated financial statements and the notes thereto, and other financial information included in this Quarterly Report on Form 10-Q. Certain statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. See “Special Note Regarding Forward-Looking Statements.”
Operations
We view each of our Integrated Resort properties as an operating segment. Our operating segments in Macao consist of The Venetian Macao; The Londoner Macao; The Parisian Macao; The Plaza Macao and Four Seasons Macao; and the Sands Macao. Our operating segment in Singapore is Marina Bay Sands.
Macao
From 2020 through the beginning of 2023, our operations in Macao were negatively impacted by the reduction in travel and tourism related to the COVID-19 pandemic. The Macao government’s policy regarding the management of COVID-19 and general travel restrictions was relaxed in late December 2022 and early January 2023. Since then, visitation to our Macao Integrated Resorts and operations has improved.
The Macao government announced total visitation from mainland China to Macao increased approximately 36.3% during the nine months ended September 30, 2024, as compared to the same period in 2023. The Macao government also announced gross gaming revenue increased approximately 31.3% during the nine months ended September 30, 2024, as compared to the same period in 2023.
Singapore
Our operations in Singapore continued to be positive as travel and tourism spending increased, resulting from the elimination of all remaining COVID-19 border measures in February 2023. Airlift passenger movement has increased with a total of 44 million passengers having passed through Singapore’s Changi Airport from January to August 2024 (the latest statistics currently available), an increase of 17% compared to the same period in 2023.
Visitation to Marina Bay Sands continues to improve since the travel restrictions have been lifted. The Singapore Tourism Board (“STB”) announced total visitation to Singapore increased to approximately 12.6 million for the nine months ended September 30, 2024, from approximately 10.1 million for the same period in 2023.
Summary
We have a strong balance sheet and sufficient liquidity in place, including total unrestricted cash and cash equivalents of $4.21 billion as of September 30, 2024 and access to $1.50 billion, $2.51 billion and $460 million of available borrowing capacity from our 2024 LVSC Revolving Facility, 2024 SCL Revolving Facility (which replaced the 2018 SCL Revolving Facility as of October 23, 2024) and 2012 Singapore Revolving Facility, respectively. We believe we are able to support our continuing operations and complete the major construction projects that are underway.
Critical Accounting Policies and Estimates
For a discussion of our significant accounting policies and estimates, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” presented in our 2023 Annual Report on Form 10-K filed on February 7, 2024.
There were no newly identified significant accounting policies and estimates during the nine months ended September 30, 2024, nor were there any material changes to the critical accounting policies and estimates discussed in our 2023 Annual Report.
Recent Accounting Pronouncements
See related disclosure at “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 1 — Organization and Business of Company — Recent Accounting Pronouncements.”
27
Operating Results
Key Operating Revenue Measurements
Operating revenues at The Venetian Macao, The Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Macao and Marina Bay Sands are dependent upon the volume of patrons who stay at the hotel, which affects the price charged for hotel rooms and our gaming volume. Operating revenues at Sands Macao are principally driven by the volume of gaming patrons who visit the property on a daily basis.
Management utilizes the following volume and pricing measures in order to evaluate past performance and assist in forecasting future revenues. The various volume measurements indicate our ability to attract patrons to our Integrated Resorts. In casino operations, win and hold percentages indicate the amount of revenue to be expected based on volume. In hotel operations, average daily rate and revenue per available room indicate the demand for rooms and our ability to capture that demand. In mall operations, base rent per square foot indicates our ability to attract and maintain profitable tenants for our leasable space.
The following are the key measurements we use to evaluate operating revenues:
Casino revenue measurements for Macao and Singapore: Macao and Singapore table games are segregated into two groups: Rolling Chip play (composed of VIP players) and Non-Rolling Chip play (mostly non-VIP players). The volume measurement for Rolling Chip play is non-negotiable gaming chips wagered and lost. The volume measurement for Non-Rolling Chip play is table games drop (“drop”), which is net markers issued (credit instruments), cash deposited in the table drop boxes and gaming chips purchased and exchanged at the cage. Rolling Chip and Non-Rolling Chip volume measurements are not comparable as they are two distinct measures of volume. The amounts wagered and lost for Rolling Chip play are substantially higher than the amounts dropped for Non-Rolling Chip play. Slot handle, also a volume measurement, is the gross amount wagered for the period cited.
We view Rolling Chip win as a percentage of Rolling Chip volume, Non-Rolling Chip win as a percentage of drop and slot hold (amount won by the casino) as a percentage of slot handle. Win or hold percentage represents the percentage of Rolling Chip volume, Non-Rolling Chip drop or slot handle that is won by the casino and recorded as casino revenue. Our win and hold percentages are calculated before discounts, commissions, deferring revenue associated with our loyalty programs and allocating casino revenues related to goods and services provided to patrons on a complimentary basis. Our Rolling Chip table games are expected to produce a win percentage of 3.30% in Macao and Singapore, and our Non-Rolling Chip table games have produced a trailing 12-month win percentage of 24.9%, 21.4%, 20.8%, 23.6%, 16.7% and 19.5% at The Venetian Macao, The Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Macao, Sands Macao and Marina Bay Sands, respectively. Our slot machines have produced a trailing 12-month hold percentage of 3.8%, 3.9%, 4.1%, 4.4%, 2.9% and 3.8% at The Venetian Macao, The Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Macao, Sands Macao and Marina Bay Sands, respectively. Actual win and hold percentages may vary from our expected win percentage and the trailing 12-month win and hold percentages. Generally, slot machine play is conducted on a cash basis. In Macao and Singapore, 9.8% and 11.7%, respectively, of our table games play was conducted on a credit basis for the nine months ended September 30, 2024.
Hotel revenue measurements: Performance indicators used are occupancy rate (a volume indicator), which is the average percentage of available hotel rooms occupied during a period and average daily room rate (“ADR,” a price indicator), which is the average price of occupied rooms per day. Available rooms exclude those rooms unavailable for occupancy during the period due to renovation, development or other requirements (such as government mandated closure, lodging for team members and usage by the Macao government for quarantine measures). The calculations of the occupancy rate and ADR include the impact of rooms provided on a complimentary basis. Revenue per available room (“RevPAR”) represents a summary of hotel ADR and occupancy. Because not all available rooms are occupied, ADR is normally higher than RevPAR. Reserved rooms where the guests do not show up for their stay and lose their deposit, or where guests check out early, may be re-sold to walk-in guests.
Mall revenue measurements: Occupancy, base rent per square foot and tenant sales per square foot are used as performance indicators. Occupancy represents gross leasable occupied area (“GLOA”) divided by gross leasable area (“GLA”) at the end of the reporting period. GLOA is the sum of: (1) tenant occupied space under lease and (2) tenants no longer occupying space, but paying rent. GLA does not include space currently under development or not on the market for lease. Base rent per square foot is the weighted average base or minimum rent charge in effect at the end of the reporting period for all tenants that would qualify to be included in occupancy. Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period. Only tenants that have been open for a minimum of 12 months are included in the tenant sales per square foot calculation.
28
Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2023
Summary Financial Results
Net revenues for the three months ended September 30, 2024, were $2.68 billion, compared to $2.80 billion for the three months ended September 30, 2023. Operating income was $504 million for the three months ended September 30, 2024, compared to $688 million for the three months ended September 30, 2023. Net income was $353 million for the three months ended September 30, 2024, compared to $449 million for the three months ended September 30, 2023.
Operating Revenues
Our net revenues consisted of the following:
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Casino | $ | 1,936 | $ | 2,008 | (3.6) | % | |||||||||||
| Rooms | 314 | 342 | (8.2) | % | |||||||||||||
| Food and beverage | 152 | 156 | (2.6) | % | |||||||||||||
| Mall | 189 | 201 | (6.0) | % | |||||||||||||
| Convention, retail and other | 91 | 88 | 3.4 | % | |||||||||||||
| Total net revenues | $ | 2,682 | $ | 2,795 | (4.0) | % | |||||||||||
Consolidated net revenues were $2.68 billion for the three months ended September 30, 2024, a decrease of $113 million compared to $2.80 billion for the three months ended September 30, 2023. The decrease was due to decreases of $94 million and $19 million at Marina Bay Sands and our Macao operations, respectively.
Net casino revenues decreased $72 million compared to the three months ended September 30, 2023. The decrease was due to a $98 million decrease at Marina Bay Sands, partially offset by a $26 million increase at our Macao operations. Casino revenues at Marina Bay Sands decreased due to decreased Rolling Chip volume and win percentage, partially offset by increased Non-Rolling Chip volume and win percentage. Our Macao operations increased due to increased slot volumes and Non-Rolling Chip win percentage, partially offset by decreased Rolling Chip win and slot hold percentages.
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Macao Operations: | |||||||||||||||||
| The Venetian Macao | |||||||||||||||||
| Total net casino revenues | $ | 554 | $ | 575 | (3.7) | % | |||||||||||
| Non-Rolling Chip drop | $ | 2,252 | $ | 2,313 | (2.6) | % | |||||||||||
| Non-Rolling Chip win percentage | 24.7 | % | 24.3 | % | 0.4 | pts | |||||||||||
| Rolling Chip volume | $ | 1,126 | $ | 953 | 18.2 | % | |||||||||||
| Rolling Chip win percentage | 3.64 | % | 6.00 | % | (2.36) | pts | |||||||||||
| Slot handle | $ | 1,441 | $ | 1,319 | 9.2 | % | |||||||||||
| Slot hold percentage | 3.9 | % | 4.3 | % | (0.4) | pts | |||||||||||
| The Londoner Macao | |||||||||||||||||
| Total net casino revenues | $ | 338 | $ | 371 | (8.9) | % | |||||||||||
| Non-Rolling Chip drop | $ | 1,598 | $ | 1,737 | (8.0) | % | |||||||||||
| Non-Rolling Chip win percentage | 21.9 | % | 20.7 | % | 1.2 | pts | |||||||||||
| Rolling Chip volume | $ | 1,548 | $ | 1,561 | (0.8) | % | |||||||||||
| Rolling Chip win percentage | 2.89 | % | 3.93 | % | (1.04) | pts | |||||||||||
| Slot handle | $ | 1,290 | $ | 1,498 | (13.9) | % | |||||||||||
| Slot hold percentage | 4.0 | % | 4.0 | % | — | pts | |||||||||||
29
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| The Parisian Macao | |||||||||||||||||
| Total net casino revenues | $ | 189 | $ | 181 | 4.4 | % | |||||||||||
| Non-Rolling Chip drop | $ | 1,054 | $ | 789 | 33.6 | % | |||||||||||
| Non-Rolling Chip win percentage | 19.6 | % | 22.0 | % | (2.4) | pts | |||||||||||
Rolling Chip volume | $ | 169 | $ | 277 | (39.0) | % | |||||||||||
Rolling Chip win percentage | (7.14) | % | 6.76 | % | (13.90) | pts | |||||||||||
| Slot handle | $ | 997 | $ | 670 | 48.8 | % | |||||||||||
| Slot hold percentage | 4.2 | % | 4.0 | % | 0.2 | pts | |||||||||||
| The Plaza Macao and Four Seasons Macao | |||||||||||||||||
| Total net casino revenues | $ | 182 | $ | 108 | 68.5 | % | |||||||||||
| Non-Rolling Chip drop | $ | 684 | $ | 570 | 20.0 | % | |||||||||||
| Non-Rolling Chip win percentage | 22.9 | % | 21.5 | % | 1.4 | pts | |||||||||||
| Rolling Chip volume | $ | 2,616 | $ | 2,068 | 26.5 | % | |||||||||||
| Rolling Chip win percentage | 3.92 | % | 2.28 | % | 1.64 | pts | |||||||||||
Slot handle | $ | 26 | $ | 10 | 160.0 | % | |||||||||||
| Slot hold percentage | 3.0 | % | (1.7) | % | 4.7 | pts | |||||||||||
| Sands Macao | |||||||||||||||||
| Total net casino revenues | $ | 73 | $ | 75 | (2.7) | % | |||||||||||
| Non-Rolling Chip drop | $ | 407 | $ | 414 | (1.7) | % | |||||||||||
| Non-Rolling Chip win percentage | 16.8 | % | 16.8 | % | — | pts | |||||||||||
| Rolling Chip volume | $ | 26 | $ | 14 | 85.7 | % | |||||||||||
| Rolling Chip win percentage | 4.39 | % | 13.84 | % | (9.45) | pts | |||||||||||
| Slot handle | $ | 560 | $ | 473 | 18.4 | % | |||||||||||
| Slot hold percentage | 2.9 | % | 3.3 | % | (0.4) | pts | |||||||||||
| Singapore Operations: | |||||||||||||||||
| Marina Bay Sands | |||||||||||||||||
| Total net casino revenues | $ | 600 | $ | 698 | (14.0) | % | |||||||||||
| Non-Rolling Chip drop | $ | 2,126 | $ | 1,936 | 9.8 | % | |||||||||||
| Non-Rolling Chip win percentage | 20.4 | % | 17.6 | % | 2.8 | pts | |||||||||||
| Rolling Chip volume | $ | 6,558 | $ | 8,149 | (19.5) | % | |||||||||||
| Rolling Chip win percentage | 1.75 | % | 3.85 | % | (2.10) | pts | |||||||||||
| Slot handle | $ | 5,855 | $ | 6,364 | (8.0) | % | |||||||||||
| Slot hold percentage | 4.0 | % | 3.6 | % | 0.4 | pts | |||||||||||
In our experience, average win percentages remain fairly consistent when measured over extended periods of time with a significant volume of wagers, but can vary considerably within shorter time periods as a result of the statistical variances associated with games of chance in which large amounts are wagered.
30
Room revenues decreased $28 million compared to the three months ended September 30, 2023. The decrease was due to our Macao operations driven by a decrease in available rooms in connection with the conversion of the Sheraton towers to the Londoner Grand. Revenues at Marina Bay Sands remained flat due to an increase in ADR, offset by a decrease in occupied room nights driven by room renovations.
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Room revenues in millions) | |||||||||||||||||
| Macao Operations: | |||||||||||||||||
| The Venetian Macao | |||||||||||||||||
| Total room revenues | $ | 54 | $ | 55 | (1.8) | % | |||||||||||
| Occupancy rate | 98.8 | % | 98.0 | % | 0.8 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 204 | $ | 212 | (3.8) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 202 | $ | 207 | (2.4) | % | |||||||||||
The Londoner Macao(1) | |||||||||||||||||
| Total room revenues | $ | 68 | $ | 97 | (29.9) | % | |||||||||||
| Occupancy rate | 97.7 | % | 95.3 | % | 2.4 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 230 | $ | 190 | 21.1 | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 225 | $ | 181 | 24.3 | % | |||||||||||
| The Parisian Macao | |||||||||||||||||
| Total room revenues | $ | 36 | $ | 37 | (2.7) | % | |||||||||||
| Occupancy rate | 98.5 | % | 97.0 | % | 1.5 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 153 | $ | 165 | (7.3) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 151 | $ | 160 | (5.6) | % | |||||||||||
| The Plaza Macao and Four Seasons Macao | |||||||||||||||||
| Total room revenues | $ | 27 | $ | 24 | 12.5 | % | |||||||||||
| Occupancy rate | 93.2 | % | 86.4 | % | 6.8 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 474 | $ | 472 | 0.4 | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 442 | $ | 408 | 8.3 | % | |||||||||||
| Sands Macao | |||||||||||||||||
| Total room revenues | $ | 4 | $ | 4 | — | % | |||||||||||
| Occupancy rate | 99.4 | % | 98.7 | % | 0.7 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 172 | $ | 173 | (0.6) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 171 | $ | 171 | — | % | |||||||||||
| Singapore Operations: | |||||||||||||||||
Marina Bay Sands(2) | |||||||||||||||||
| Total room revenues | $ | 125 | $ | 125 | — | % | |||||||||||
| Occupancy rate | 94.7 | % | 96.3 | % | (1.6) | pts | |||||||||||
| Average daily room rate (ADR) | $ | 903 | $ | 681 | 32.6 | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 855 | $ | 656 | 30.3 | % | |||||||||||
__________________________
(1)During the three months ended September 30, 2024, a daily average of approximately 2,550 rooms were excluded from available rooms in connection with the renovations related to the conversion of the Sheraton towers to the Londoner Grand in connection with Phase II of The Londoner Macao.
(2)During the three months ended September 30, 2024 and 2023, approximately 1,600 and 2,200 rooms, respectively, were available for occupancy.
31
Mall revenues decreased $12 million compared to the three months ended September 30, 2023. The decrease of $7 million in our Macao operations was primarily driven by a $14 million decrease in overage rent, partially offset by a $6 million increase in base rent. The $5 million decrease at Marina Bay Sands was driven by an $8 million decrease in overage rent, partially offset by a $4 million increase in base rent. For further information related to the financial performance of our malls, see “Additional Information Regarding our Retail Mall Operations.” The following table summarizes the results of our malls on the Cotai Strip in Macao and in Singapore:
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Mall revenues in millions) | |||||||||||||||||
| Macao Operations: | |||||||||||||||||
| Shoppes at Venetian | |||||||||||||||||
| Total mall revenues | $ | 59 | $ | 58 | 1.7 | % | |||||||||||
| Mall gross leasable area (in square feet) | 822,456 | 818,773 | 0.4 | % | |||||||||||||
| Occupancy | 83.6 | % | 80.0 | % | 3.6 | pts | |||||||||||
| Base rent per square foot | $ | 289 | $ | 277 | 4.3 | % | |||||||||||
Tenant sales per square foot(1) | $ | 1,615 | $ | 1,743 | (7.3) | % | |||||||||||
| Shoppes at Londoner | |||||||||||||||||
| Total mall revenues | $ | 20 | $ | 17 | 17.6 | % | |||||||||||
| Mall gross leasable area (in square feet) | 566,272 | 611,192 | (7.3) | % | |||||||||||||
| Occupancy | 70.5 | % | 54.2 | % | 16.3 | pts | |||||||||||
| Base rent per square foot | $ | 155 | $ | 152 | 2.0 | % | |||||||||||
Tenant sales per square foot(1) | $ | 1,491 | $ | 1,701 | (12.3) | % | |||||||||||
| Shoppes at Parisian | |||||||||||||||||
| Total mall revenues | $ | 6 | $ | 7 | (14.3) | % | |||||||||||
| Mall gross leasable area (in square feet) | 296,818 | 296,352 | 0.2 | % | |||||||||||||
| Occupancy | 67.7 | % | 66.1 | % | 1.6 | pts | |||||||||||
| Base rent per square foot | $ | 103 | $ | 110 | (6.4) | % | |||||||||||
Tenant sales per square foot(1) | $ | 525 | $ | 641 | (18.1) | % | |||||||||||
| Shoppes at Four Seasons | |||||||||||||||||
| Total mall revenues | $ | 40 | $ | 50 | (20.0) | % | |||||||||||
| Mall gross leasable area (in square feet) | 261,845 | 249,303 | 5.0 | % | |||||||||||||
| Occupancy | 90.1 | % | 92.7 | % | (2.6) | pts | |||||||||||
| Base rent per square foot | $ | 630 | $ | 595 | 5.9 | % | |||||||||||
Tenant sales per square foot(1) | $ | 5,832 | $ | 6,714 | (13.1) | % | |||||||||||
| Singapore Operations: | |||||||||||||||||
| The Shoppes at Marina Bay Sands | |||||||||||||||||
| Total mall revenues | $ | 63 | $ | 68 | (7.4) | % | |||||||||||
| Mall gross leasable area (in square feet) | 615,944 | 616,699 | (0.1) | % | |||||||||||||
| Occupancy | 99.1 | % | 99.5 | % | (0.4) | pts | |||||||||||
| Base rent per square foot | $ | 354 | $ | 315 | 12.4 | % | |||||||||||
Tenant sales per square foot(1) | $ | 2,919 | $ | 2,998 | (2.6) | % | |||||||||||
__________________________
Note: This table excludes the results of our retail outlets at Sands Macao.
(1) Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period.
Convention, retail and other revenues increased $3 million compared to the three months ended September 30, 2023. The increase was due to a $9 million increase at Marina Bay Sands, partially offset by a $6 million decrease at our Macao operations. The increase at Marina Bay Sands was driven by increases of $5 million in convention revenue and $4 million in other revenues (e.g., Sky Park, spa). The decrease at our Macao operations was primarily due to a $12 million insurance recovery due to Typhoon Saola in September 2023, partially offset by increases of $3 million in entertainment, $2 million in ferry operations and $1 million in other revenues (e.g., limo, exhibits).
32
Operating Expenses
Our operating expenses consisted of the following:
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Casino | $ | 1,120 | $ | 1,103 | 1.5 | % | |||||||||||
| Rooms | 79 | 80 | (1.3) | % | |||||||||||||
| Food and beverage | 129 | 128 | 0.8 | % | |||||||||||||
| Mall | 23 | 23 | — | % | |||||||||||||
| Convention, retail and other | 62 | 52 | 19.2 | % | |||||||||||||
| Provision for (recovery of) credit losses | (5) | 3 | (266.7) | % | |||||||||||||
| General and administrative | 293 | 290 | 1.0 | % | |||||||||||||
| Corporate | 68 | 49 | 38.8 | % | |||||||||||||
| Pre-opening | 4 | 3 | 33.3 | % | |||||||||||||
| Development | 55 | 44 | 25.0 | % | |||||||||||||
| Depreciation and amortization | 324 | 313 | 3.5 | % | |||||||||||||
| Amortization of leasehold interests in land | 15 | 15 | — | % | |||||||||||||
| Loss on disposal or impairment of assets | 11 | 4 | 175.0 | % | |||||||||||||
| Total operating expenses | $ | 2,178 | $ | 2,107 | 3.4 | % | |||||||||||
Operating expenses were $2.18 billion for the three months ended September 30, 2024, an increase of $71 million compared to $2.11 billion for the three months ended September 30, 2023. The increase was primarily driven by increases of $19 million in corporate expenses, $17 million in casino expenses, $11 million in development expenses and $11 million in depreciation and amortization expense.
Casino expenses increased $17 million compared to the three months ended September 30, 2023. The increase was primarily attributable to a $21 million increase in gaming taxes at our Macao operations due to increased gross gaming revenues, partially offset by an $11 million decrease in gaming taxes at Marina Bay Sands due to decreased casino revenues. The decrease in gaming taxes at Marina Bay Sands was partially offset by a 1% increase in goods and service tax (“GST”) in Singapore as of January 1, 2024.
Convention, retail and other expenses increased $10 million compared to the three months ended September 30, 2023, due to a $9 million increase at our Macao operations. The increase was due to increases of $3 million in entertainment due to more special events, $2 million in ferry operations due to increased expenses for gas and oil and repairs and maintenance, and $4 million in other operating expenses (e.g., limos, exhibits).
Recovery of credit losses was $5 million for three months ended September 30, 2024, compared to provision for credit losses of $3 million for the three months ended September 30, 2023. The $8 million decrease was due to Marina Bay Sands, resulting from a $14 million increase in collections on previously reserved accounts, partially offset by a $6 million increase in the provision for the current quarter. The provision for credit losses at our Macao operations remained flat due to $4 million in collections on previously reserved accounts, offset by a $4 million decrease in provision for the current quarter. The amount of this provision can vary over short periods of time because of factors specific to the patrons who owe us money from gaming activities. We believe the amount of our provision for credit losses in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.
Corporate expense increased $19 million compared to the three months ended September 30, 2023. The increase was primarily due to a $9 million increase in payroll, $3 million related to a shareholder dividend tax agreement with the Macao government and a $4 million decrease in legal fee recoveries.
Development expenses were $55 million for the three months ended September 30, 2024, compared to $44 million for the three months ended September 30, 2023. During the three months ended September 30, 2024, the increase was primarily due to increased efforts related to our digital gaming pursuits. Development costs are expensed as incurred.
Depreciation and amortization increased $11 million compared to the three months ended September 30, 2023. The increase was primarily due to a $40 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service throughout 2023 and through the third quarter of 2024. This increase was partially offset by a $31 million decrease at our Macao operations due to a decrease in accelerated depreciation related to the conversion of the
33
Sheraton towers to the Londoner Grand in connection with Phase II of The Londoner Macao and a decrease due to assets fully depreciated during the prior year and through the third quarter of the current year, partially offset by an increase in depreciation due to assets placed into service after September 30, 2023.
Loss on disposal or impairment of assets was $11 million for three months ended September 30, 2024. The losses incurred for the three months ended September 30, 2024, were primarily due to an $8 million loss in Macao, including demolition costs primarily related to Phase II of The Londoner Macao and the write-off of design costs, and a $2 million loss at Marina Bay Sands from demolition costs related to room renovations.
Segment Adjusted Property EBITDA
The following table summarizes information related to our segments:
| Three Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Macao: | |||||||||||||||||
| The Venetian Macao | $ | 267 | $ | 290 | (7.9) | % | |||||||||||
| The Londoner Macao | 124 | 167 | (25.7) | % | |||||||||||||
| The Parisian Macao | 74 | 81 | (8.6) | % | |||||||||||||
| The Plaza Macao and Four Seasons Macao | 102 | 71 | 43.7 | % | |||||||||||||
| Sands Macao | 14 | 17 | (17.6) | % | |||||||||||||
| Ferry Operations and Other | 4 | 5 | (20.0) | % | |||||||||||||
| 585 | 631 | (7.3) | % | ||||||||||||||
| Marina Bay Sands | 406 | 491 | (17.3) | % | |||||||||||||
Consolidated adjusted property EBITDA(1) | $ | 991 | $ | 1,122 | (11.7) | % | |||||||||||
__________________________
(1) Consolidated adjusted property EBITDA, which is a non-GAAP financial measure, is used by management as the primary measure of the operating performance of our segments. Consolidated adjusted property EBITDA is net income (loss) before stock-based compensation expense, corporate expense, pre-opening expense, development expense, depreciation and amortization, amortization of leasehold interests in land, gain or loss on disposal or impairment of assets, interest, other income or expense, gain or loss on modification or early retirement of debt and income taxes. Consolidated adjusted property EBITDA is a supplemental non-GAAP financial measure used by management, as well as industry analysts, to evaluate operations and operating performance. In particular, management utilizes consolidated adjusted property EBITDA to compare the operating profitability of our operations with those of our competitors, as well as a basis for determining certain incentive compensation. Integrated Resort companies, including LVSC, have historically reported adjusted property EBITDA as a supplemental performance measure to GAAP financial measures. In order to view the operations of their properties on a more stand-alone basis, Integrated Resort companies, including LVSC, have historically excluded certain expenses that do not relate to the management of specific properties, such as pre-opening expense, development expense and corporate expense, from their adjusted property EBITDA calculations. Consolidated adjusted property EBITDA should not be interpreted as an alternative to income from operations (as an indicator of operating performance) or to cash flows from operations (as a measure of liquidity), in each case, as determined in accordance with GAAP. We have significant uses of cash flow, including capital expenditures, dividend payments, interest payments, debt principal repayments and income taxes, which are not reflected in consolidated adjusted property EBITDA. Not all companies calculate adjusted property EBITDA in the same manner. As a result, our presentation of consolidated adjusted property EBITDA may not be directly comparable to similarly titled measures presented by other companies.
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| Three Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Consolidated adjusted property EBITDA | $ | 991 | $ | 1,122 | |||||||
| Other Operating Costs and Expenses | |||||||||||
Stock-based compensation(a) | (10) | (6) | |||||||||
| Corporate | (68) | (49) | |||||||||
| Pre-opening | (4) | (3) | |||||||||
| Development | (55) | (44) | |||||||||
| Depreciation and amortization | (324) | (313) | |||||||||
| Amortization of leasehold interests in land | (15) | (15) | |||||||||
| Loss on disposal or impairment of assets | (11) | (4) | |||||||||
| Operating income | 504 | 688 | |||||||||
| Other Non-Operating Costs and Expenses | |||||||||||
| Interest income | 67 | 79 | |||||||||
| Interest expense, net of amounts capitalized | (179) | (200) | |||||||||
Other income | 11 | 4 | |||||||||
| Income tax expense | (50) | (122) | |||||||||
| Net income | $ | 353 | $ | 449 | |||||||
__________________________
(a)During the three months ended September 30, 2024 and 2023, we recorded stock-based compensation expense of $24 million and $16 million, respectively, of which $14 million and $10 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.
Adjusted property EBITDA at our Macao operations decreased $46 million compared with the three months ended September 30, 2023, due to decreases across room, mall, food and beverage and other non-gaming operations at our Integrated Resorts in Macao.
Adjusted property EBITDA at Marina Bay Sands decreased $85 million compared to the three months ended September 30, 2023, primarily due to a decrease in casino operations.
Interest Expense
The following table summarizes information related to interest expense:
| Three Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (Dollars in millions) | |||||||||||
Interest cost | $ | 183 | $ | 202 | |||||||
| Less — capitalized interest | (4) | (2) | |||||||||
Interest expense, net | $ | 179 | $ | 200 | |||||||
Weighted average total debt balance | $ | 13,865 | $ | 14,863 | |||||||
Weighted average interest rate | 5.1 | % | 5.4 | % | |||||||
Interest cost decreased $19 million compared to the three months ended September 30, 2023, primarily due to decreases in the weighted average interest rate from 5.4% to 5.1% and the weighted average total debt balance from $14.86 billion to $13.87 billion. The weighted average interest rate decreased primarily due to lower interest rates on the SCL senior notes in connection with the credit rating upgrades for the Company and Sands China Ltd. (“SCL”) to BBB- by S&P on July 26, 2023 and Fitch on February 1, 2024, and the decrease in interest rates on our Singapore Credit Facility. These items were partially offset by higher interest rates associated with the issuance of the LVSC Senior Notes on May 16, 2024 to accomplish the repayment of the 2024 LVSC Senior Notes on June 26, 2024. The weighted average total debt balance decreased primarily due to the repayment of $1.95 billion on the SCL Revolving Facility by October 2023 and repurchases totaling $175 million of the 2025 SCL Senior Notes throughout the three months ended June 30, 2024.
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Other Factors Affecting Earnings
Interest income was $67 million for the three months ended September 30, 2024, compared to $79 million for the three months ended September 30, 2023. The decrease was attributable to a decrease in cash available to invest in the U.S. due to share repurchases, dividends and development-related spend in the last twelve months. This decrease was partially offset by increased paid-in-kind interest rate under the seller financing loan agreement entered into in connection with the sale of our Las Vegas real property and operations and an increase in cash available to invest in Macao.
Other income was $11 million for the three months ended September 30, 2024, compared to $4 million for the three months ended September 30, 2023. Other income during the three months ended September 30, 2024, was primarily attributable to $10 million of foreign currency transaction gains driven by U.S. dollar denominated debt held by SCL.
Our income tax expense was $50 million on income before income taxes of $403 million for the three months ended September 30, 2024, resulting in a 12.4% effective income tax rate. This compares to a 21.4% effective income tax rate for the three months ended September 30, 2023. The income tax expense for the three months ended September 30, 2024, reflects a 17% statutory tax rate on our Singapore operations, a 21% corporate income tax on our domestic operations and a zero percent rate on our Macao gaming operations due to our income tax exemption in Macao.
On February 5, 2024, the Macao government provided notice that Venetian Macau Limited (“VML,” a subsidiary of SCL) and its peers received an income tax exemption on gaming operations for the period January 1, 2023 through December 31, 2027. Additionally, we entered into a shareholder dividend tax agreement with the Macao government in February 2024, effective January 1, 2023 through December 31, 2025, providing an annual payment as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits. For the three months ended September 30, 2023, income tax expense included an anticipated $38 million shareholder dividend tax based on the information available at the balance sheet date.
The net income attributable to noncontrolling interests was $78 million for the three months ended September 30, 2024, compared to $69 million for the three months ended September 30, 2023. These amounts were related to the noncontrolling interest of SCL.
Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023
Operating Revenues
Our net revenues consisted of the following:
| Nine Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Casino | $ | 6,199 | $ | 5,411 | 14.6 | % | |||||||||||
| Rooms | 957 | 881 | 8.6 | % | |||||||||||||
| Food and beverage | 450 | 423 | 6.4 | % | |||||||||||||
| Mall | 537 | 535 | 0.4 | % | |||||||||||||
| Convention, retail and other | 259 | 207 | 25.1 | % | |||||||||||||
| Total net revenues | $ | 8,402 | $ | 7,457 | 12.7 | % | |||||||||||
Consolidated net revenues were $8.40 billion for the nine months ended September 30, 2024, an increase of $945 million compared to $7.46 billion for the nine months ended September 30, 2023, primarily due to increases of $638 million and $307 million at our Macao operations and Marina Bay Sands, respectively.
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Net casino revenues increased $788 million compared to the nine months ended September 30, 2023. The increase was driven by increases of $563 million and $225 million at our Macao operations and Marina Bay Sands, respectively. Casino revenue at our Macao operations increased due to increased table games and slot volumes, partially offset by decreased Rolling Chip win and slot hold percentages. Casino revenues at Marina Bay Sands increased due to increased Non-Rolling Chip drop and Non-Rolling Chip and Rolling Chip win percentages, partially offset by decreased Rolling Chip volume.
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| Nine Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Singapore Operations: | |||||||||||||||||
| Marina Bay Sands | |||||||||||||||||
| Total net casino revenues | $ | 2,165 | $ | 1,940 | 11.6 | % | |||||||||||
| Non-Rolling Chip drop | $ | 6,329 | $ | 5,482 | 15.5 | % | |||||||||||
| Non-Rolling Chip win percentage | 19.6 | % | 18.2 | % | 1.4 | pts | |||||||||||
| Rolling Chip volume | $ | 20,874 | $ | 21,237 | (1.7) | % | |||||||||||
| Rolling Chip win percentage | 3.69 | % | 3.51 | % | 0.18 | pts | |||||||||||
| Slot handle | $ | 18,473 | $ | 17,926 | 3.1 | % | |||||||||||
| Slot hold percentage | 3.9 | % | 3.9 | % | — | pts | |||||||||||
__________________________
(1)During the current year, a majority of the slot machines were relocated to other properties, with the remaining slot machines made available based on demand.
In our experience, average win percentages remain fairly consistent when measured over extended periods of time with a significant volume of wagers, but can vary considerably within shorter time periods as a result of the statistical variances associated with games of chance in which large amounts are wagered.
38
Room revenues increased $76 million compared to the nine months ended September 30, 2023. The increase was due to increases of $49 million and $27 million at Marina Bay Sands and our Macao operations, respectively. Marina Bay Sands room revenues increased due to an increase in ADR, partially offset by a decrease in available rooms and decreased occupancy. Macao room revenues increased due to an increase in occupancy rates, partially offset by decreases in available rooms in connection with the conversion of the Sheraton towers to the Londoner Grand and ADR due to increased hotel inventory across the Macao market.
The following table summarizes the results of our room activity:
| Nine Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Room revenues in millions) | |||||||||||||||||
| Macao Operations: | |||||||||||||||||
| The Venetian Macao | |||||||||||||||||
| Total room revenues | $ | 156 | $ | 142 | 9.9 | % | |||||||||||
| Occupancy rate | 97.6 | % | 93.1 | % | 4.5 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 202 | $ | 209 | (3.3) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 197 | $ | 195 | 1.0 | % | |||||||||||
The Londoner Macao(1) | |||||||||||||||||
| Total room revenues | $ | 234 | $ | 232 | 0.9 | % | |||||||||||
| Occupancy rate | 96.1 | % | 74.9 | % | 21.2 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 201 | $ | 201 | — | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 193 | $ | 150 | 28.7 | % | |||||||||||
| The Parisian Macao | |||||||||||||||||
| Total room revenues | $ | 102 | $ | 100 | 2.0 | % | |||||||||||
| Occupancy rate | 96.5 | % | 91.0 | % | 5.5 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 152 | $ | 159 | (4.4) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 147 | $ | 145 | 1.4 | % | |||||||||||
| The Plaza Macao and Four Seasons Macao | |||||||||||||||||
| Total room revenues | $ | 77 | $ | 69 | 11.6 | % | |||||||||||
| Occupancy rate | 89.0 | % | 79.3 | % | 9.7 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 482 | $ | 490 | (1.6) | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 429 | $ | 389 | 10.3 | % | |||||||||||
| Sands Macao | |||||||||||||||||
| Total room revenues | $ | 13 | $ | 12 | 8.3 | % | |||||||||||
| Occupancy rate | 99.0 | % | 94.8 | % | 4.2 | pts | |||||||||||
| Average daily room rate (ADR) | $ | 173 | $ | 170 | 1.8 | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 171 | $ | 161 | 6.2 | % | |||||||||||
| Singapore Operations: | |||||||||||||||||
Marina Bay Sands(2) | |||||||||||||||||
| Total room revenues | $ | 375 | $ | 326 | 15.0 | % | |||||||||||
| Occupancy rate | 95.0 | % | 96.9 | % | (1.9) | pts | |||||||||||
| Average daily room rate (ADR) | $ | 796 | $ | 626 | 27.2 | % | |||||||||||
| Revenue per available room (RevPAR) | $ | 757 | $ | 607 | 24.7 | % | |||||||||||
__________________________
(1)During the nine months ended September 30, 2024, a daily average of approximately 1,400 rooms were excluded from available rooms in connection with the renovations related to the conversion of the Sheraton towers to the Londoner Grand in connection with Phase II of The Londoner Macao.
(2)During the nine months ended September 30, 2024 and 2023, approximately 1,850 and 2,000 rooms, respectively, were available for occupancy.
Food and beverage revenues increased $27 million compared to the nine months ended September 30, 2023. The increase was driven by increased business volume at food and beverage outlets and banquet operations at our Macao operations.
39
Mall revenues increased $2 million compared to the nine months ended September 30, 2023. While Macao operations remained stable, the $2 million increase related to Marina Bay Sands was driven by a $13 million increase in base rent, partially offset by an $11 million decrease in overage rent and revenues related to CAM and other reimbursements.
For further information related to the financial performance of our malls, see “Additional Information Regarding our Retail Mall Operations.” The following table summarizes the results of our malls on the Cotai Strip in Macao and in Singapore:
Nine Months Ended September 30,(1) | |||||||||||||||||
| 2024 | 2023 | Change | |||||||||||||||
| (Mall revenues in millions) | |||||||||||||||||
| Macao Operations: | |||||||||||||||||
| Shoppes at Venetian | |||||||||||||||||
| Total mall revenues | $ | 167 | $ | 161 | 3.7 | % | |||||||||||
| Mall gross leasable area (in square feet) | 822,456 | 818,773 | 0.4 | % | |||||||||||||
| Occupancy | 83.6 | % | 80.0 | % | 3.6 | pts | |||||||||||
| Base rent per square foot | $ | 289 | $ | 277 | 4.3 | % | |||||||||||
Tenant sales per square foot(2) | $ | 1,615 | $ | 1,743 | (7.3) | % | |||||||||||
| Shoppes at Londoner | |||||||||||||||||
| Total mall revenues | $ | 53 | $ | 47 | 12.8 | % | |||||||||||
| Mall gross leasable area (in square feet) | 566,272 | 611,192 | (7.3) | % | |||||||||||||
| Occupancy | 70.5 | % | 54.2 | % | 16.3 | pts | |||||||||||
| Base rent per square foot | $ | 155 | $ | 152 | 2.0 | % | |||||||||||
Tenant sales per square foot(2) | $ | 1,491 | $ | 1,701 | (12.3) | % | |||||||||||
| Shoppes at Parisian | |||||||||||||||||
| Total mall revenues | $ | 20 | $ | 23 | (13.0) | % | |||||||||||
| Mall gross leasable area (in square feet) | 296,818 | 296,352 | 0.2 | % | |||||||||||||
| Occupancy | 67.7 | % | 66.1 | % | 1.6 | pts | |||||||||||
| Base rent per square foot | $ | 103 | $ | 110 | (6.4) | % | |||||||||||
Tenant sales per square foot(2) | $ | 525 | $ | 641 | (18.1) | % | |||||||||||
| Shoppes at Four Seasons | |||||||||||||||||
| Total mall revenues | $ | 116 | $ | 125 | (7.2) | % | |||||||||||
| Mall gross leasable area (in square feet) | 261,845 | 249,303 | 5.0 | % | |||||||||||||
| Occupancy | 90.1 | % | 92.7 | % | (2.6) | pts | |||||||||||
| Base rent per square foot | $ | 630 | $ | 595 | 5.9 | % | |||||||||||
Tenant sales per square foot(2) | $ | 5,832 | $ | 6,714 | (13.1) | % | |||||||||||
| Singapore Operations: | |||||||||||||||||
| The Shoppes at Marina Bay Sands | |||||||||||||||||
| Total mall revenues | $ | 180 | $ | 178 | 1.1 | % | |||||||||||
| Mall gross leasable area (in square feet) | 615,944 | 616,699 | (0.1) | % | |||||||||||||
| Occupancy | 99.1 | % | 99.5 | % | (0.4) | pts | |||||||||||
| Base rent per square foot | $ | 354 | $ | 315 | 12.4 | % | |||||||||||
Tenant sales per square foot(2) | $ | 2,919 | $ | 2,998 | (2.6) | % | |||||||||||
__________________________
Note: This table excludes the results of our retail outlets at Sands Macao.
(1) As GLA, occupancy, base rent per square foot and tenant sales per square foot are calculated as of September 30, 2024 and 2023, they are identical to the summary presented herein for the three months ended September 30, 2024 and 2023, respectively.
(2) Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period.
40
Convention, retail and other revenues increased $52 million compared to the nine months ended September 30, 2023, due primarily to increases of $32 million and $20 million at Marina Bay Sands and our Macao operations, respectively. The increase at Marina Bay Sands was due to increases of $13 million in convention revenue, $3 million in entertainment revenue and $8 million in other operating revenues (e.g., limo, Sky Park, spa), as well as an $8 million nonrecurring adjustment related to a change in accounting estimate of our non-gaming club points accrual. The increase at our Macao operations was driven by increases of $12 million in ferry operations due to increased sailings resulting from increased visitation and $10 million in entertainment revenue, partially offset by a decrease of $2 million in other revenues (e.g., limo, exhibits).
Operating Expenses
Our operating expenses consisted of the following:
| Nine Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Casino | $ | 3,441 | $ | 3,011 | 14.3 | % | |||||||||||
| Rooms | 234 | 207 | 13.0 | % | |||||||||||||
| Food and beverage | 379 | 349 | 8.6 | % | |||||||||||||
| Mall | 62 | 65 | (4.6) | % | |||||||||||||
| Convention, retail and other | 177 | 141 | 25.5 | % | |||||||||||||
| Provision for credit losses | 10 | 2 | 400.0 | % | |||||||||||||
| General and administrative | 847 | 820 | 3.3 | % | |||||||||||||
| Corporate | 215 | 166 | 29.5 | % | |||||||||||||
| Pre-opening | 10 | 13 | (23.1) | % | |||||||||||||
| Development | 169 | 140 | 20.7 | % | |||||||||||||
| Depreciation and amortization | 960 | 875 | 9.7 | % | |||||||||||||
| Amortization of leasehold interests in land | 45 | 43 | 4.7 | % | |||||||||||||
| Loss on disposal or impairment of assets | 41 | 22 | 86.4 | % | |||||||||||||
| Total operating expenses | $ | 6,590 | $ | 5,854 | 12.6 | % | |||||||||||
Operating expenses were $6.59 billion for the nine months ended September 30, 2024, an increase of $736 million compared to $5.85 billion for the nine months ended September 30, 2023. The increase was primarily driven by increases of $430 million in casino expenses, $85 million in depreciation and amortization expense and $49 million in corporate expense.
Casino expenses increased $430 million compared to the nine months ended September 30, 2023. The increase was primarily attributable to increases of $312 million and $62 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues and a 1% increase in GST in Singapore as of January 1, 2024.
Room expenses increased $27 million compared to the nine months ended September 30, 2023. The increase was due to increases of $15 million and $12 million at our Macao operations and Marina Bay Sands, respectively, driven by increased occupancy in Macao and higher costs associated with new and elevated suites and rooms introduced at Marina Bay Sands throughout 2023 and through the third quarter of 2024.
Food and beverage expenses increased $30 million compared to the nine months ended September 30, 2023. The increase was due to increases of $25 million and $5 million at our Macao operations and Marina Bay Sands, respectively, driven by increased business volume at food outlets and banquets operations.
Convention, retail and other expenses increased $36 million compared to the nine months ended September 30, 2023, due to increases of $28 million and $8 million at our Macao operations and Marina Bay Sands, respectively. The increase at our Macao operations was primarily due to increases of $12 million in ferry operation expenses due to higher repairs and maintenance and fuel due to additional sailings resulting from increased visitation, $10 million in entertainment expenses due to increased event volume and $6 million in other operating expenses. The increase at Marina Bay Sands was primarily due to increases of $2 million in entertainment, $1 million in convention and $5 million in other operating expenses.
Provision for credit losses was $10 million for the nine months ended September 30, 2024, compared to $2 million for the nine months ended September 30, 2023. The increase in provision was due to an $11 million increase at our Macao operations, partially offset by a $3 million decrease at Marina Bay Sands. The increase at our Macao operations was primarily due to $14 million in settlements from previously reserved accounts in the prior year, partially offset by a $3 million decrease in the provision for the current period. The decrease at Marina Bay Sands was primarily due to a
41
$17 million increase in collections on previously reserved accounts, partially offset by a $14 million increase in the provision for the current period. The amount of this provision can vary over short periods of time because of factors specific to the patrons who owe us money from gaming activities. We believe the amount of our provision for credit losses in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.
General and administrative expenses increased $27 million compared to the nine months ended September 30, 2023. The increase was primarily due to increases of $15 million and $12 million at our Macao operations and Marina Bay Sands, respectively, driven by increases in payroll, marketing expenses and facilities and utilities costs.
Corporate expenses increased $49 million compared to the nine months ended September 30, 2023. The increase was primarily due to $19 million related to a shareholder dividend tax agreement with the Macao government, which was finalized on February 7, 2024, and covers the years from 2023 to 2025, an $18 million increase in payroll expenses, an $8 million increase in other expenses driven by information technology costs, professional services and travel costs, and a $4 million decrease in legal fee recoveries.
Development expenses were $169 million for the nine months ended September 30, 2024, compared to $140 million for the nine months ended September 30, 2023. During the nine months ended September 30, 2024, the increased costs were associated with increased efforts primarily related to our digital gaming pursuits. Development costs are expensed as incurred.
Depreciation and amortization increased $85 million compared to the nine months ended September 30, 2023. The increase was primarily due to a $111 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service throughout 2023 and through the third quarter of 2024. This increase was partially offset by $30 million decrease at our Macao operations due to assets fully depreciated during the prior year and through the third quarter of 2024, partially offset by an increase in depreciation for assets placed into service during the current year.
Loss on disposal or impairment of assets was $41 million for the nine months ended September 30, 2024, compared to $22 million for the nine months ended September 30, 2023. The losses incurred for the nine months ended September 30, 2024 were due to a $25 million loss in Macao, including $19 million in demolition costs, primarily related to the upgrade of the Cotai Arena and Phase II of The Londoner Macao, an $8 million loss at Marina Bay Sands, including demolition costs related to room renovation at Marina Bay Sands, and an $8 million loss at corporate primarily due to the sale of an aircraft.
Segment Adjusted Property EBITDA
The following table summarizes information related to our segments:
| Nine Months Ended September 30, | |||||||||||||||||
| 2024 | 2023 | Percent Change | |||||||||||||||
| (Dollars in millions) | |||||||||||||||||
| Macao: | |||||||||||||||||
| The Venetian Macao | $ | 843 | $ | 752 | 12.1 | % | |||||||||||
| The Londoner Macao | 399 | 326 | 22.4 | % | |||||||||||||
| The Parisian Macao | 228 | 201 | 13.4 | % | |||||||||||||
| The Plaza Macao and Four Seasons Macao | 238 | 237 | 0.4 | % | |||||||||||||
| Sands Macao | 36 | 42 | (14.3) | % | |||||||||||||
| Ferry Operations and Other | 12 | 12 | — | % | |||||||||||||
| 1,756 | 1,570 | 11.8 | % | ||||||||||||||
| Marina Bay Sands | 1,515 | 1,317 | 15.0 | % | |||||||||||||
Consolidated adjusted property EBITDA(1) | $ | 3,271 | $ | 2,887 | 13.3 | % | |||||||||||
____________________
(1) Consolidated adjusted property EBITDA, which is a non-GAAP financial measure, is used by management as the primary measure of the operating performance of our segments. Consolidated adjusted property EBITDA is net income (loss) from before stock-based compensation expense, corporate expense, pre-opening expense, development expense, depreciation and amortization, amortization of leasehold interests in land, gain or loss on disposal or impairment of assets, interest, other income or expense, gain or loss on modification or early retirement of debt and income taxes. Consolidated adjusted property EBITDA is a supplemental non-GAAP financial measure used by management, as well as industry analysts, to evaluate operations and operating performance. In particular, management utilizes consolidated adjusted property EBITDA to compare the operating profitability of our operations with those of
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our competitors, as well as a basis for determining certain incentive compensation. Integrated Resort companies, including LVSC, have historically reported adjusted property EBITDA as a supplemental performance measure to GAAP financial measures. In order to view the operations of their properties on a more stand-alone basis, Integrated Resort companies, including LVSC, have historically excluded certain expenses that do not relate to the management of specific properties, such as pre-opening expense, development expense and corporate expense, from their adjusted property EBITDA calculations. Consolidated adjusted property EBITDA should not be interpreted as an alternative to income from operations (as an indicator of operating performance) or to cash flows from operations (as a measure of liquidity), in each case, as determined in accordance with GAAP. We have significant uses of cash flow, including capital expenditures, dividend payments, interest payments, debt principal repayments and income taxes, which are not reflected in consolidated adjusted property EBITDA. Not all companies calculate adjusted property EBITDA in the same manner. As a result, our presentation of consolidated adjusted property EBITDA may not be directly comparable to similarly titled measures presented by other companies.
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Consolidated adjusted property EBITDA | $ | 3,271 | $ | 2,887 | |||||||
| Other Operating Costs and Expenses | |||||||||||
Stock-based compensation(a) | (19) | (25) | |||||||||
| Corporate | (215) | (166) | |||||||||
| Pre-opening | (10) | (13) | |||||||||
| Development | (169) | (140) | |||||||||
| Depreciation and amortization | (960) | (875) | |||||||||
| Amortization of leasehold interests in land | (45) | (43) | |||||||||
| Loss on disposal or impairment of assets | (41) | (22) | |||||||||
Operating income | 1,812 | 1,603 | |||||||||
| Other Non-Operating Costs and Expenses | |||||||||||
| Interest income | 218 | 225 | |||||||||
| Interest expense, net of amounts capitalized | (547) | (628) | |||||||||
Other income (expense) | 16 | (17) | |||||||||
| Income tax expense | (139) | (221) | |||||||||
Net income | $ | 1,360 | $ | 962 | |||||||
____________________
(a)During the nine months ended September 30, 2024 and 2023, the Company recorded stock-based compensation expense of $58 million and $58 million, respectively, of which $39 million and $33 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.
Adjusted property EBITDA at our Macao operations increased $186 million compared to the nine months ended September 30, 2023, primarily due to increased revenues across our operations driven by increased visitation at our Integrated Resorts in Macao.
Adjusted property EBITDA at Marina Bay Sands increased $198 million compared to the nine months ended September 30, 2023. The increase was primarily due to increased casino and room operations driven by increased visitation, as well as new and elevated suites and rooms and other amenities introduced at Marina Bay Sands.
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Interest Expense
The following table summarizes information related to interest expense:
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (Dollars in millions) | |||||||||||
Interest cost | $ | 557 | $ | 633 | |||||||
Less — capitalized interest | (10) | (5) | |||||||||
Interest expense, net | $ | 547 | $ | 628 | |||||||
Weighted average total debt balance | $ | 14,219 | $ | 15,500 | |||||||
Weighted average interest rate | 5.0 | % | 5.4 | % | |||||||
Interest cost decreased $76 million compared to the nine months ended September 30, 2023, primarily due to decreases in the weighted average interest rate from 5.4% to 5.0% and the weighted average total debt balance from $15.50 billion to $14.22 billion. The weighted average interest rate decreased primarily due to lower interest rates on the SCL senior notes in connection with the credit rating upgrades for the Company and SCL to BBB- by S&P on July 26, 2023 and Fitch on February 1, 2024, and a decrease in the interest rates on our Singapore Credit Facility. The weighted average total debt balance decreased primarily due to the repayment of $1.95 billion on the SCL Revolving Facility by October 2023 and repurchases totaling $175 million of the 2025 SCL Senior Notes throughout the three months ended June 30, 2024.
Other Factors Affecting Earnings
Interest income was $218 million for the nine months ended September 30, 2024, compared to $225 million for the nine months ended September 30, 2023, a decrease of $7 million, which was primarily attributable to a decrease in cash available to invest in the U.S. due to share repurchases, dividends and development-related spend in the last twelve months. This decrease was partially offset by an increased paid-in-kind interest rate under the seller financing loan agreement entered into in connection with the sale of our Las Vegas real property and operations and an increase in cash available to invest in Macao.
Other income was $16 million for the nine months ended September 30, 2024, compared to other expense of $17 million for the nine months ended September 30, 2023. Other income during the nine months ended September 30, 2024, was primarily attributable to foreign currency transaction gains of $11 million driven by U.S. dollar denominated debt held by SCL and $6 million driven by U.S. dollar denominated debt and bank deposits held by Marina Bay Sands.
Our income tax expense was $139 million on income before income taxes of $1.50 billion for the nine months ended September 30, 2024, resulting in a 9.3% effective income tax rate. This compares to an 18.7% effective income tax rate for the nine months ended September 30, 2023. The income tax expense for the nine months ended September 30, 2024, reflects a 17% statutory tax rate on our Singapore operations, a 21% corporate income tax on our domestic operations, and a zero percent rate on our Macao gaming operations due to our income tax exemption in Macao.
On February 5, 2024, the Macao government provided notice that VML and its peers received an income tax exemption on gaming operations for the period January 1, 2023 through December 31, 2027. Additionally, we entered into a shareholder dividend tax agreement with the Macao government in February 2024, effective January 1, 2023 through December 31, 2025, providing an annual payment as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits. For the year ended December 31, 2023, income tax expense included an anticipated $57 million shareholder dividend tax based on the information available at the balance sheet date. During the three months ended March 31, 2024, we reversed the $57 million income tax expense and recorded $10 million to corporate expense related to the year ended December 31, 2023, to reflect the terms of the new shareholder dividend tax agreement.
The net income attributable to noncontrolling interests was $238 million for the nine months ended September 30, 2024, compared to $123 million for the nine months ended September 30, 2023. These amounts were related to the noncontrolling interest of SCL.
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Additional Information Regarding our Retail Mall Operations
We own and operate retail malls at our Integrated Resorts at The Venetian Macao, The Plaza Macao and Four Seasons Macao, The Londoner Macao, The Parisian Macao and Marina Bay Sands. Management believes being in the retail mall business and, specifically, owning some of the largest retail properties in Asia provides meaningful value for us, particularly as the retail market in Asia continues to grow.
Our malls are designed to complement our other unique amenities and service offerings provided by our Integrated Resorts. Our strategy is to seek out desirable tenants that appeal to our patrons and provide a wide variety of shopping options. We generate our mall revenues primarily from leases with tenants through minimum base rents, overage rents and reimbursements for common area maintenance and other expenditures.
The following tables summarize the results of our mall operations on the Cotai Strip and at Marina Bay Sands for the three and nine months ended September 30, 2024 and 2023:
| Shoppes at Venetian | Shoppes at Four Seasons | Shoppes at Londoner | Shoppes at Parisian | The Shoppes at Marina Bay Sands | |||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||
| For the three months ended September 30, 2024 | |||||||||||||||||||||||||||||
| Mall revenues: | |||||||||||||||||||||||||||||
Minimum rents(1) | $ | 47 | $ | 32 | $ | 11 | $ | 3 | $ | 44 | |||||||||||||||||||
| Overage rents | 4 | 6 | 4 | 1 | 11 | ||||||||||||||||||||||||
| CAM, levies and direct recoveries | 8 | 2 | 5 | 2 | 8 | ||||||||||||||||||||||||
| Total mall revenues | 59 | 40 | 20 | 6 | 63 | ||||||||||||||||||||||||
| Mall operating expenses: | |||||||||||||||||||||||||||||
| Common area maintenance | 4 | 1 | 3 | 1 | 5 | ||||||||||||||||||||||||
| Marketing and other direct operating expenses | 3 | 3 | 1 | 1 | 2 | ||||||||||||||||||||||||
| Mall operating expenses | 7 | 4 | 4 | 2 | 7 | ||||||||||||||||||||||||
Property taxes(2) | — | — | — | — | 1 | ||||||||||||||||||||||||
Mall-related expenses(3) | $ | 7 | $ | 4 | $ | 4 | $ | 2 | $ | 8 | |||||||||||||||||||
| For the three months ended September 30, 2023 | |||||||||||||||||||||||||||||
| Mall revenues: | |||||||||||||||||||||||||||||
Minimum rents(1) | $ | 43 | $ | 31 | $ | 9 | $ | 4 | $ | 40 | |||||||||||||||||||
| Overage rents | 7 | 17 | 4 | 1 | 19 | ||||||||||||||||||||||||
| CAM, levies and direct recoveries | 8 | 2 | 4 | 2 | 9 | ||||||||||||||||||||||||
| Total mall revenues | 58 | 50 | 17 | 7 | 68 | ||||||||||||||||||||||||
| Mall operating expenses: | |||||||||||||||||||||||||||||
| Common area maintenance | 3 | 2 | 2 | 1 | 6 | ||||||||||||||||||||||||
| Marketing and other direct operating expenses | 2 | 2 | 2 | — | 2 | ||||||||||||||||||||||||
| Mall operating expenses | 5 | 4 | 4 | 1 | 8 | ||||||||||||||||||||||||
Property taxes(2) | — | — | — | — | 2 | ||||||||||||||||||||||||
Mall-related expenses(3) | $ | 5 | $ | 4 | $ | 4 | $ | 1 | $ | 10 | |||||||||||||||||||
| For the nine months ended September 30, 2024 | |||||||||||||||||||||||||||||
| Mall revenues: | |||||||||||||||||||||||||||||
Minimum rents(1) | $ | 137 | $ | 94 | $ | 32 | $ | 12 | $ | 130 | |||||||||||||||||||
| Overage rents | 6 | 14 | 7 | 2 | 27 | ||||||||||||||||||||||||
| CAM, levies and direct recoveries | 24 | 8 | 14 | 6 | 23 | ||||||||||||||||||||||||
| Total mall revenues | 167 | 116 | 53 | 20 | 180 | ||||||||||||||||||||||||
| Mall operating expenses: | |||||||||||||||||||||||||||||
| Common area maintenance | 11 | 4 | 7 | 3 | 16 | ||||||||||||||||||||||||
| Marketing and other direct operating expenses | 6 | 5 | 3 | 2 | 5 | ||||||||||||||||||||||||
| Mall operating expenses | 17 | 9 | 10 | 5 | 21 | ||||||||||||||||||||||||
Property taxes(2) | 1 | — | — | — | 3 | ||||||||||||||||||||||||
Mall-related expenses(3) | $ | 18 | $ | 9 | $ | 10 | $ | 5 | $ | 24 | |||||||||||||||||||
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| Shoppes at Venetian | Shoppes at Four Seasons | Shoppes at Londoner | Shoppes at Parisian | The Shoppes at Marina Bay Sands | |||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||
| For the nine months ended September 30, 2023 | |||||||||||||||||||||||||||||
| Mall revenues: | |||||||||||||||||||||||||||||
Minimum rents(1) | $ | 124 | $ | 92 | $ | 25 | $ | 13 | $ | 117 | |||||||||||||||||||
| Overage rents | 14 | 26 | 11 | 4 | 36 | ||||||||||||||||||||||||
| CAM, levies and direct recoveries | 23 | 7 | 11 | 6 | 25 | ||||||||||||||||||||||||
| Total mall revenues | 161 | 125 | 47 | 23 | 178 | ||||||||||||||||||||||||
| Mall operating expenses: | |||||||||||||||||||||||||||||
| Common area maintenance | 10 | 4 | 6 | 3 | 17 | ||||||||||||||||||||||||
| Marketing and other direct operating expenses | 7 | 7 | 4 | 2 | 4 | ||||||||||||||||||||||||
| Mall operating expenses | 17 | 11 | 10 | 5 | 21 | ||||||||||||||||||||||||
Property taxes(2) | 1 | — | — | — | 5 | ||||||||||||||||||||||||
Mall-related expenses(3) | $ | 18 | $ | 11 | $ | 10 | $ | 5 | $ | 26 | |||||||||||||||||||
____________________
Note: This table excludes the results of our retail outlets at Sands Macao.
(1)Minimum rents include base rents and straight-line adjustments of base rents.
(2)Commercial property that generates rental income is exempt from property tax for the first six years for newly constructed buildings in Cotai. If the property also qualifies for Tourism Utility Status, the property tax exemption can be extended to twelve years with effect from the opening of the property. The exemption for The Venetian Macao and The Plaza Macao and Four Seasons Macao expired, and the exemption for The Londoner Macao and The Parisian Macao will be expiring in December 2027 and September 2028, respectively.
(3)Mall-related expenses consist of CAM, marketing fees and other direct operating expenses, property taxes and provision for credit losses, but excludes depreciation and amortization and general and administrative costs.
It is common in the mall operating industry for companies to disclose mall net operating income (“NOI”) as a useful supplemental measure of a mall’s operating performance. Because NOI excludes general and administrative expenses, interest expense, impairment losses, depreciation and amortization, gains and losses from property dispositions, allocations to noncontrolling interests and provision for income taxes, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating costs.
In the tables above, we believe taking total mall revenues less mall-related expenses provides an operating performance measure for our malls. Other mall operating companies may use different methodologies for deriving mall-related expenses. As such, this calculation may not be comparable to the NOI of other mall operating companies.
Development Projects
We regularly evaluate opportunities to improve our product offerings, such as refreshing our meeting and convention facilities, suites and rooms, retail malls, restaurant and nightlife mix and our gaming areas, as well as other anticipated revenue-generating additions to our Integrated Resorts.
Macao
As part of the gaming concession entered into by VML and the Macao government, VML has a financial commitment to spend 35.80 billion patacas (approximately $4.47 billion at exchange rates in effect on September 30, 2024) through 2032 on both capital and operating projects, including 33.36 billion patacas (approximately $4.17 billion at exchange rates in effect on September 30, 2024) in non-gaming projects that will also appeal to international visitors.
We continue work on Phase II of The Londoner Macao, which includes the renovation of the rooms in the Sheraton and Conrad hotel towers, an upgrade of the gaming areas and the addition of new attractions, dining, retail and entertainment offerings. The Londoner Grand casino opened on September 26, 2024. The Sheraton Grand Macao is being converted into the Londoner Grand hotel and will become Macao’s first Marriott international luxury collection hotel. As of September 30, 2024, approximately 300 newly renovated rooms and suites were available for occupancy at the Londoner Grand. These projects have a total estimated cost of $1.2 billion and are expected to be substantially completed in early 2025.
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Singapore
In April 2019, our wholly owned subsidiary, Marina Bay Sands Pte. Ltd. (“MBS”) and the STB entered into a development agreement (the “Second Development Agreement”) pursuant to which MBS has agreed to construct a development (the “MBS Expansion Project”) on a land parcel adjacent to Marina Bay Sands.
The MBS Expansion Project will include a hotel tower with luxury rooms and suites, a rooftop attraction, premium gaming areas, convention and meeting facilities and a state-of-the-art live entertainment arena with approximately 15,000 seats.
Our estimated total project cost is approximately $8.0 billion, inclusive of financing fees and interest, land premiums and the purchase of an additional 2,000 square meters of gaming area (the “Additional Gaming Area”), increasing Marina Bay Sands’ total approved gaming area to 17,000 square meters across the existing property and the MBS Expansion Project.
We have incurred approximately $1.3 billion as of September 30, 2024, inclusive of the payment made in 2019 for the lease of the parcels of land underlying the MBS Expansion Project site. The additional payment due to the Singapore government related to the Additional Gaming Area and changes to the MBS Expansion Project gross floor area allocation is estimated to be approximately $1.0 billion and anticipated to be paid no later than in the first quarter of 2025.
On April 3, 2024, MBS and the STB entered into a letter agreement, which further extended the construction commencement deadline to July 8, 2025, and the construction completion deadline to July 8, 2029.
We will begin construction as soon as government approvals are received, with an estimated commencement date in June 2025. While our current estimate is that construction will be complete June 2030 with an anticipated opening date in January 2031, any extension of the completion date beyond the July 2029 deadline is subject to the approval of the Singapore government.
The renovation of Towers 1 and 2 of Marina Bay Sands is now complete and has introduced world class suites and other luxury amenities at a cost of approximately $1.0 billion. We are continuing with the renovation of the Tower 3 hotel rooms into world class suites and other property changes at an estimated cost of approximately $750 million, with an expected completion by 2025. These renovations at Marina Bay Sands are substantially upgrading the overall guest experience for its premium customers, including new dining and retail experiences, and upgrading the casino floor, among other things. These projects are in addition to the MBS Expansion Project.
New York
On June 2, 2023, we paid $241 million to acquire the Nassau Veterans Memorial Coliseum (the “Nassau Coliseum”) from Nassau Live Center, LLC and related entities, the owners and operators of an entertainment arena in the State of New York. The purchase of the Nassau Coliseum, which continues to operate following the closing of the sale, primarily included the fixed assets related to the arena and the right to lease the underlying land from the owner, the County of Nassau (the “County”) in the State of New York. We purchased the Nassau Coliseum with the intent to obtain a casino license from the State of New York to develop and operate an Integrated Resort. There is no assurance we will be able to obtain such casino license. Refer to “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 7 — Leases” for further details.
Other
We continue to evaluate additional development projects in each of our markets and pursue new development opportunities globally.
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Liquidity and Capital Resources
Cash Flows — Summary
Our cash flows consisted of the following:
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (In millions) | |||||||||||
| Net cash generated from operating activities | $ | 2,289 | $ | 2,221 | |||||||
Cash flows from investing activities: | |||||||||||
| Capital expenditures | (1,020) | (692) | |||||||||
| Proceeds from disposal of property and equipment | 1 | 3 | |||||||||
| Acquisition of intangible assets and other | (10) | (236) | |||||||||
| Net cash used in investing activities | (1,029) | (925) | |||||||||
Cash flows from financing activities: | |||||||||||
| Proceeds from exercise of stock options | 1 | 4 | |||||||||
| Tax withholding on vesting of equity awards | (4) | (1) | |||||||||
| Repurchase of common stock | (1,300) | — | |||||||||
Dividends paid | (445) | (153) | |||||||||
| Proceeds from long-term debt | 1,748 | — | |||||||||
| Repayments on long-term debt | (1,979) | (1,803) | |||||||||
| Payments of financing costs | (21) | (32) | |||||||||
Unsettled forward contract for purchase of noncontrolling interest | (103) | — | |||||||||
Capped call option contract | (50) | — | |||||||||
| Other | (28) | (25) | |||||||||
| Net cash used in financing activities | $ | (2,181) | $ | (2,010) | |||||||
Cash Flows — Operating Activities
Table games play at our properties is conducted on a cash and credit basis, while slot machine play is primarily conducted on a cash basis. Our rooms, food and beverage and other non-gaming revenues are conducted primarily on a cash basis and to a lesser extent as a trade receivable. Operating cash flows are generally affected by changes in operating income, accounts receivable, gaming related liabilities and interest payments. Cash flows from operating activities for the nine months ended September 30, 2024, increased $68 million compared to the nine months ended September 30, 2023. The increase in cash generated from operations was primarily due to our Macao and Singapore operations generating increased operating income driven by increased visitation in both Macao and Singapore. The increase was partially offset by decreases in cash related to changes in working capital due to our gaming operations.
Cash Flows — Investing Activities
Capital expenditures for the nine months ended September 30, 2024, totaled $1.02 billion. Included in this amount was $534 million for construction and development activities in Macao, which consisted of $348 million for The Londoner Macao, $155 million for The Venetian Macao, $11 million for The Parisian Macao, $10 million for Sands Macao, $9 million for The Plaza Macao and Four Seasons Macao and $1 million for ferry operations and other, and $454 million for construction activities at Marina Bay Sands in Singapore, primarily due to the room renovations being completed across the property. Additionally, we funded $32 million for corporate and other costs.
Capital expenditures for the nine months ended September 30, 2023, totaled $692 million. Included in this amount was $400 million for construction activities at Marina Bay Sands in Singapore and $124 million for construction and development activities in Macao, which consisted of $66 million for The Londoner Macao, $44 million for The Venetian Macao, $8 million for The Plaza Macao and Four Seasons Macao, $3 million for Sands Macao and $3 million for The Parisian Macao. Additionally, we funded $168 million for corporate and other costs.
Net cash flows from investing activities for the nine months ended September 30, 2023, included a payment of $221 million related to the purchase of the Nassau Coliseum.
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Cash Flows — Financing Activities
Net cash flows used in financing activities were $2.18 billion for the nine months ended September 30, 2024. We utilized $1.30 billion for common stock repurchases and $445 million for dividend payments related to our stockholder return of capital program, and funded $103 million for a forward contract to purchase common stock of SCL to increase our equity ownership in SCL and $50 million for a capped call contract to purchase common stock of LVSC. There were net repayments of long-term debt of $231 million primarily related to the repurchase of $175 million of SCL senior notes for $174 million (see below). Lastly, we paid $21 million in deferred offering costs, primarily related to the new LVSC revolving credit agreement and the issuance of new LVSC senior notes, and $28 million in other financial liability payments.
Net cash flows used in financing activities were $2.01 billion for the nine months ended September 30, 2023, which was primarily attributable to $1.80 billion in repayments on long-term debt, primarily related to the repayment on the SCL revolving facility of $1.70 billion, $153 million in dividend payments, $32 million in deferred offering costs, primarily relating to the amendment and restatement of the 2018 SCL Credit Facility, and $25 million in other financial liability payments.
Capital Financing Overview
We fund our development projects primarily through borrowings from our debt instruments and operating cash flows.
On April 3, 2024, LVSC entered into a revolving credit agreement with the arrangers and lenders named therein and The Bank of Nova Scotia, as administrative agent for the lenders (the “2024 LVSC Revolving Credit Agreement”), pursuant to which the lenders provided unsecured, revolving credit commitments to LVSC in an aggregate principal amount of $1.50 billion (the “2024 LVSC Revolving Facility”), which are available until April 3, 2029, and include a $150 million sub-facility for letters of credit. LVSC may utilize the proceeds of the loans for general corporate purposes and working capital requirements of LVSC and its subsidiaries and any other purpose not prohibited by the 2024 LVSC Revolving Credit Agreement. Upon entering into the 2024 LVSC Revolving Credit Agreement, the existing LVSC Revolving Credit Agreement was terminated. The terms and conditions under the 2024 LVSC Revolving Credit Agreement are similar to those under the LVSC Revolving Credit Facility. Refer to “Part I — Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 3 — Long-Term Debt” for further details.
On May 16, 2024, we issued, in an underwritten public offering, three series of senior unsecured notes in an aggregate principal amount of $1.75 billion (see “Part I — Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 3 — Long-Term Debt”). The net proceeds from the offering and cash on hand were used to repay in full the outstanding borrowings under the 3.200% Senior Notes due 2024, resulting in a loss on early retirement of debt of $1 million.
During the three months ended June 30, 2024, SCL repurchased $175 million of the outstanding principal amount of $1.80 billion of its 5.125% Senior Notes due August 8, 2025 (“2025 SCL Senior Notes”), resulting in a gain on early retirement of debt of approximately $1 million. As of September 30, 2024, the 2025 SCL Senior Notes had a remaining aggregate principal amount of $1.63 billion.
On October 23, 2024, SCL entered into a new facility agreement (the “2024 SCL Credit Facility”) with the arrangers and lenders named therein and Bank of China Limited, Macau Branch, as agent for the lenders. In connection with the entry into the 2024 SCL Credit Facility, the commitments under SCL’s existing 2018 SCL Credit Facility terminated.
The 2024 SCL Credit Facility provides for a 19.50 billion Hong Kong dollars (“HKD,” approximately $2.51 billion at exchange rates in effect on September 30, 2024) unsecured revolving credit facility (the “2024 SCL Revolving Facility”). SCL may draw revolving loans under the 2024 SCL Revolving Facility from time to time until September 24, 2029 (or if that day is not a business day in Hong Kong or Macao, the next business day), for general corporate and working capital requirements of SCL and its subsidiaries, subject to certain restrictions set forth in the 2024 SCL Credit Facility. The final maturity date of all loans drawn under the 2024 SCL Credit Facility is October 23, 2029.
The 2024 SCL Credit Facility also makes available an HKD 12.95 billion (approximately $1.67 billion at exchange rates in effect on September 30, 2024) unsecured term loan facility (the “2024 SCL Term Loan Facility”). SCL may make a drawdown under the 2024 SCL Term Loan Facility at any time until August 31, 2025, for the purpose of repaying amounts outstanding under its unsecured 5.125% Senior Notes due August 2025. The final maturity date of such loan drawn under the 2024 SCL Term Loan Facility is the date falling on the fifth anniversary of the date on which such loan is drawn. Refer to “Part I — Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 3 — Long-Term Debt” for further details.
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Our U.S., SCL and Singapore credit facilities, as amended, contain various financial covenants, which include maintaining a maximum leverage ratio, as defined per the respective facility agreements. As of September 30, 2024, our U.S., SCL and Singapore leverage ratios, as defined per the respective credit facility agreements, were 2.54x, 3.11x and 1.54x, respectively, compared to the maximum leverage ratios allowed of 4.00x, 5.00x and 4.50x, respectively. Under the new 2024 SCL Credit Facility, the maximum leverage ratio allowed is 4.00x beginning with the quarterly period ending December 31, 2024. If we are unable to maintain compliance with the financial covenants under these credit facilities, we would be in default under the respective credit facilities.
We held unrestricted cash and cash equivalents of approximately $4.21 billion and restricted cash of approximately $125 million as of September 30, 2024, of which approximately $2.71 billion of the unrestricted amount is held by non-U.S. subsidiaries. Of the $2.71 billion, approximately $2.16 billion is available to be repatriated, either in the form of dividends or via intercompany loans or advances, to the U.S., subject to levels of earnings, cash flow generated from gaming operations and various other factors, including dividend requirements to third-party public stockholders in the case of funds being repatriated from SCL, compliance with certain local statutes, laws and regulations currently applicable to our subsidiaries and restrictions in connection with their contractual arrangements. We do not expect withholding taxes or other foreign income taxes to apply should these earnings be distributed in the form of dividends or otherwise.
We believe we have a strong balance sheet and sufficient liquidity in place, including unrestricted cash and cash equivalents of $4.21 billion and cash flow generated from operations, as well as $4.47 billion available for borrowing under our U.S., SCL and Singapore revolving credit facilities, net of outstanding letters of credit, and SGD 3.69 billion (approximately $2.88 billion at exchange rates in effect on September 30, 2024) under our Singapore Delayed Draw Term Facility as of September 30, 2024 (only available for draws after the construction cost estimate and construction schedule for the MBS Expansion Project have been delivered to the lenders). We believe we are well positioned to support our operations, maintain compliance with the financial covenants of our credit facilities and fund our working capital needs, committed and planned capital expenditures, development opportunities, debt obligations and dividend commitments, as well as meet our commitments under the Macao Concession. In the normal course of our activities, we will continue to evaluate global capital markets to consider future opportunities for enhancements of our capital structure.
On February 14, May 15 and August 14, 2024, we paid a quarterly dividend of $0.20 per common share as part of a regular cash dividend program and, during the nine months ended September 30, 2024, recorded $446 million as a distribution against retained earnings. In October 2024, our Board of Directors declared a quarterly dividend of $0.20 per common share (a total estimated to be approximately $145 million) to be paid on November 13, 2024, to stockholders of record on November 5, 2024. Our Board of Directors announced a $0.20 increase in the Company’s recurring common stock dividend for the 2025 calendar year, raising the annual dividend to $1.00 per share ($0.25 per share per quarter). Our Board of Directors will continue to assess the level of appropriateness of any cash dividends.
On September 9, 2024, the Company’s wholly owned subsidiary, Venetian Venture Development II (“VVDI II”), entered into a Master Confirmation and Supplemental Confirmation (collectively, the “Second Forward Purchase Agreement”) with a financial institution (the “Dealer”) relating to the purchase of the common stock of SCL (the “Second Forward Purchase Transaction”), in which VVDI II made an upfront payment of HKD 800 million (approximately $103 million at exchange rates as of the date of the transaction). All purchases under the Second Forward Purchase Transaction were completed by October 22, 2024, with a settlement date of October 28, 2024, when the Dealer will deliver approximately 23 million shares of SCL common stock to us, representing an average price of HKD 14.64 per share. The additional shares will result in an increase of our ownership of SCL to approximately 71.31%. Due to the Second Forward Purchase Transaction reaching the Cap Amount (as defined in the agreement) during the term of the agreement, approximately $59 million will be returned to VVDI II in the form of cash.
Share Repurchase Program
During the nine months ended September 30, 2024, we repurchased 28,746,681 shares of our common stock for $1.31 billion (including commissions and $13 million in excise tax) under our share repurchase program. All share repurchases of our common stock have been recorded as treasury stock. Subsequently, on October 22, 2024, our Board of Directors authorized increasing the remaining share repurchase amount from $195 million to $2.0 billion and extending the share repurchase program’s expiration date to November 3, 2026.
Repurchases of our common stock are made at our discretion in accordance with applicable federal securities laws in the open market or otherwise. The timing and actual number of shares to be repurchased in the future will depend on a variety of factors, including our financial position, earnings, cash flows, legal requirements, other investment opportunities and market conditions.
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Aggregate Indebtedness and Other Contractual Obligations
As of September 30, 2024, there had been no material changes to our aggregated indebtedness and other contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2023, with the exception of the extinguishment of the 2024 LVSC Senior Notes, the new LVSC Senior Notes, the partial repurchase of the 2025 SCL Senior Notes and the decrease in fixed interest payments on the SCL Senior Notes due to an upgraded credit rating from Fitch. | |||||||||||||||||||||||||||||
Payments Due by Period | |||||||||||||||||||||||||||||
2024(1) | 2025 - 2026 | 2027 - 2028 | Thereafter | Total | |||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||
Long-Term Debt Obligations(2) | |||||||||||||||||||||||||||||
| LVSC Senior Notes | $ | — | $ | 1,500 | $ | 750 | $ | 1,750 | $ | 4,000 | |||||||||||||||||||
| SCL Senior Notes | — | 2,425 | 2,600 | 1,950 | 6,975 | ||||||||||||||||||||||||
| Fixed Interest Payments | 47 | 865 | 553 | 359 | 1,824 | ||||||||||||||||||||||||
| Total | $ | 47 | $ | 4,790 | $ | 3,903 | $ | 4,059 | $ | 12,799 | |||||||||||||||||||
_______________________
(1)Represents the three-month period ending December 31, 2024.
(2)See “Item 1 — Financial Statements — Notes to Consolidated Financial Statements — Note 3 — Long-Term Debt” for further details on these financing transactions.
Special Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the discussions of our business strategies and expectations concerning future operations, margins, profitability, liquidity and capital resources. In addition, in certain portions included in this report, the words: “anticipates,” “believes,” “continues,” “estimates,” “expects,” “intends,” “may,” “plans,” “positions,” “remains,” “seeks,” “will,” “would,” and similar expressions, as they relate to our Company or management, are intended to identify forward-looking statements. Although we believe these forward-looking statements are reasonable, we cannot assure you any forward-looking statements will prove to be correct. These statements represent our expectations, beliefs, intentions or strategies concerning future events that, by their nature, involve known and unknown risks, uncertainties and other factors beyond our control, which may cause our actual results, performance, achievements or other expectations to be materially different from any future results, performance, achievements or other expectations expressed or implied by these forward-looking statements. These factors include, but are not limited to, the risks associated with:
•our ability to maintain our concession in Macao and gaming license in Singapore;
•our ability to invest in future growth opportunities, or attempt to expand our business in new markets and new ventures;
•the ability to execute our previously announced capital expenditure programs, and produce future returns;
•general economic and business conditions internationally, which may impact levels of disposable income, consumer spending, group meeting business, pricing of hotel rooms and retail and mall tenant sales;
•disruptions or reductions in travel and our operations due to natural or man-made disasters, pandemics, epidemics or outbreaks of infectious or contagious diseases, political instability, civil unrest, terrorist activity or war;
•the uncertainty of consumer behavior related to discretionary spending and vacationing at our Integrated Resorts in Macao and Singapore;
•the extensive regulations to which we are subject and the costs of compliance or failure to comply with such regulations;
•new developments and construction projects at our existing properties (for example, development at our Cotai Strip properties and the MBS Expansion Project);
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•regulatory policies in China or other countries in which our patrons reside, or where we have operations, including visa restrictions limiting the number of visits or the length of stay for visitors from China to Macao, restrictions on foreign currency exchange or importation of currency, and the judicial enforcement of gaming debts;
•the possibility that the laws and regulations of mainland China become applicable to our operations in Macao and Hong Kong;
•the possibility that economic, political and legal developments in Macao adversely affect our Macao operations, or that there is a change in the manner in which regulatory oversight is conducted in Macao;
•our leverage, debt service and debt covenant compliance, including the pledge of certain of our assets (other than our equity interests in our subsidiaries) as security for our indebtedness and ability to refinance our debt obligations as they come due or to obtain sufficient funding for our planned, or any future, development projects;
•fluctuations in currency exchange rates and interest rates, and the possibility of increased expense as a result;
•increased competition for labor and materials due to planned construction projects in Macao and Singapore and quota limits on the hiring of foreign workers;
•our ability to compete for limited management and labor resources in Macao and Singapore, and policies of those governments that may also affect our ability to employ imported managers or labor from other countries;
•our dependence upon properties primarily in Macao and Singapore for all of our cash flow and the ability of our subsidiaries to make distribution payments to us;
•the passage of new legislation and receipt of governmental approvals for our operations in Macao and Singapore and other jurisdictions where we are planning to operate;
•the ability of our insurance coverage to cover all possible losses that our properties could suffer and the potential for our insurance costs to increase in the future;
•our ability to collect gaming receivables from our credit players;
•the collectability of our outstanding loan receivable;
•our dependence on chance and theoretical win rates;
•fraud and cheating that could result in losses in our gaming operations and reputational harm;
•our ability to establish and protect our intellectual property rights;
•reputational risk related to the license of certain of our trademarks;
•the possibility that our securities may be prohibited from being traded in the U.S. securities market under the Holding Foreign Companies Accountable Act;
•conflicts of interest that arise because certain of our directors and officers are also directors and officers of SCL;
•government regulation of the casino industry (as well as new laws and regulations and changes to existing laws and regulations), including gaming license regulation, the requirement for certain beneficial owners of our securities to be found suitable by gaming authorities, the legalization of gaming in other jurisdictions and regulation of gaming on the internet;
•increased competition in Macao, including recent and upcoming increases in hotel rooms, meeting and convention space, retail space, potential additional gaming licenses and online gaming;
•the popularity of Macao and Singapore as convention and trade show destinations;
•new taxes, changes to existing tax rates or proposed changes in tax legislation;
•the continued services of our key officers;
•any potential conflict between the interests of our Principal Stockholders and us;
•labor actions and other labor problems;
•our failure to maintain the integrity of our information and information systems or comply with applicable privacy and data security requirements and regulations;
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•the completion of infrastructure projects in Macao;
•limitations on the transfers of cash to and from our subsidiaries, limitations of the pataca exchange markets and restrictions on the export of the renminbi;
•the outcome of any ongoing and future litigation; and
•potential negative impacts from environmental, social and governance and sustainability matters.
All future written and verbal forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Readers are cautioned not to place undue reliance on these forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we assume no obligation to update any forward-looking statements after the date of this report as a result of new information, future events or developments, except as required by federal securities laws.
Investors and others should note we announce material financial information using our investor relations website (https://investor.sands.com), our company website, SEC filings, investor events, news and earnings releases, public conference calls and webcasts. We use these channels to communicate with our investors and the public about our company, our products and services, and other issues.
In addition, we post certain information regarding SCL, a subsidiary of LVSC with ordinary shares listed on The Stock Exchange of Hong Kong Limited, from time to time on our company website and our investor relations website. It is possible the information we post regarding SCL could be deemed to be material information.
The contents of these websites are not intended to be incorporated by reference into this Quarterly Report on Form 10-Q or in any other report or document we file, and any reference to these websites are intended to be inactive textual references only.
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ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodity prices. Our primary exposures to market risk are interest rate risk associated with our long-term debt and foreign currency exchange rate risk associated with our operations outside the United States, which we may manage through the use of futures, options, caps, forward contracts and similar instruments. We do not hold or issue financial instruments for trading purposes and do not enter into derivative transactions that would be considered speculative positions.
As of September 30, 2024, the estimated fair value of our long-term debt was approximately $13.72 billion, compared to its contractual value of $13.95 billion. The estimated fair value of our long-term debt is based on recent trades, if available, and indicative pricing from market information (level 2 inputs). A hypothetical 100 basis point change in market rates would cause the fair value of our long-term debt to change by $320 million. A hypothetical 100 basis point change in Secured Overnight Financing Rate (“SOFR”), Hong Kong Inter-Bank Offered Rate (“HIBOR”) and Singapore Overnight Rate Average (“SORA”) would cause our annual interest cost on our long-term debt to change by approximately $29 million.
Foreign currency transaction gains were $16 million for the nine months ended September 30, 2024, primarily due to U.S. dollar denominated debt issued by SCL. We may be vulnerable to changes in the U.S. dollar/SGD and U.S. dollar/pataca exchange rates. There were no material balances denominated in U.S. dollars related to our Singapore operations as of September 30, 2024; however, these balances fluctuate to support our operations. Based on balances as of September 30, 2024, a hypothetical 1% weakening of the U.S. dollar/pataca exchange rate would cause a foreign currency transaction loss of approximately $19 million (net of the impact from the foreign currency swap agreements). The pataca is pegged to the Hong Kong dollar and the Hong Kong dollar is pegged to the U.S. dollar (within a narrow range). We maintain a significant amount of our operating funds in the same currencies in which we have obligations, thereby reducing our exposure to currency fluctuations.
ITEM 4 — CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure. The Company’s Chief Executive Officer and its Chief Financial Officer have evaluated the disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) of the Company as of September 30, 2024, and have concluded they are effective at the reasonable assurance level.
It should be noted any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there can be no assurance any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal control over financial reporting that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that had a material effect, or were reasonably likely to have a material effect, on the Company’s internal control over financial reporting.
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PART II OTHER INFORMATION
ITEM 1 — LEGAL PROCEEDINGS
The Company is party to litigation matters and claims related to its operations. For more information, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, and “Part I — Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 9 — Commitments and Contingencies” of this Quarterly Report on Form 10-Q.
ITEM 1A — RISK FACTORS
There have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
ITEM 2 — UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The following table provides information about share repurchases made by the Company of its common stock during the quarter ended September 30, 2024:
| Period | Total Number of Shares Purchased | Weighted Average Price Paid Per Share(1) | Total Number of Shares Purchased as Part of a Publicly Announced Program | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions)(2) | ||||||||||||||||||||||
July 1, 2024 — July 31, 2024 | 1,885,183 | $ | 39.75 | 1,885,183 | $ | 570 | ||||||||||||||||||||
August 1, 2024 — August 31, 2024 | 9,545,379 | $ | 39.28 | 9,545,379 | $ | 195 | ||||||||||||||||||||
September 1, 2024 — September 30, 2024 | — | $ | — | — | $ | 195 | ||||||||||||||||||||
Total | 11,430,562 | 11,430,562 | ||||||||||||||||||||||||
__________________________
(1)Calculated excluding commissions.
(2)In November 2016, our Board of Directors authorized the repurchase of $1.56 billion of its outstanding common stock, which was to expire on November 2, 2018. In June 2018, our Board of Directors authorized increasing the remaining repurchase amount of $1.11 billion to $2.50 billion and extending the expiration date to November 2020. In October 2020, our Board of Directors authorized the extension of the expiration date of the remaining repurchase amount of $916 million to November 2022, and in October 2022, our Board of Directors authorized the further extension of the expiration date of the remaining repurchase amount of $916 million to November 2024. In October 2023, our Board of Directors authorized increasing the remaining share repurchase amount of $916 million to $2.0 billion and extending the expiration date from November 2024 to November 3, 2025. Subsequently, on October 22, 2024, our Board of Directors authorized increasing the remaining share repurchase amount from $195 million to $2.0 billion and extending the share repurchase program’s expiration date to November 3, 2026.
All repurchases under the stock repurchase program are made from time to time at our discretion in accordance with applicable federal securities laws. All share repurchases of our common stock have been recorded as treasury stock.
ITEM 5 — OTHER INFORMATION
During the quarter ended September 30, 2024, there were no Rule 10b5‑1 trading arrangements (as defined in Item 408(a) of Regulation S-K) or non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K) adopted or terminated by any director or officer (as defined in Rule 16a‑1(f) under the Exchange Act) of the Company.
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ITEM 6 — EXHIBITS
List of Exhibits
| Exhibit No. | Description of Document | |||||||
| 10.1* | ||||||||
| 31.1 | ||||||||
| 31.2 | ||||||||
| 32.1+ | ||||||||
| 32.2+ | ||||||||
| 101 | The following financial information from the Company’s Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2024, formatted in Inline Extensible Business Reporting Language (“iXBRL”): (i) Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, (ii) Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023, (iii) Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2024 and 2023, (iv) Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2024 and 2023, (v) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023, and (vi) Notes to Condensed Consolidated Financial Statements. | |||||||
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document | |||||||
____________________
* Certain exhibits and schedules have been omitted in accordance with Item 601(a)(5) of Regulation S-K.
+ This exhibit will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
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LAS VEGAS SANDS CORP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this quarterly report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.
| LAS VEGAS SANDS CORP. | |||||||||||
| October 25, 2024 | By: | /S/ ROBERT G. GOLDSTEIN | |||||||||
| Robert G. Goldstein Chairman of the Board and Chief Executive Officer (Principal Executive Officer) | |||||||||||
| October 25, 2024 | By: | /S/ RANDY HYZAK | |||||||||
| Randy Hyzak Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |||||||||||
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