The Las Vegas market has shown consistent growth over the long term and recently, both in terms of visitation and expenditures, and has one of the highest hotel occupancy rates of any major market in the United States. According to the LVCVA, the number of visitors traveling to Las Vegas has increased at a steady and significant rate over the last ten years, from 23.5 million visitors in 1993 to 35.5 million visitors in 2003. In addition, the population of Las Vegas has nearly doubled in the last ten years, from approximately 890,000 in 1993 to approximately 1,642,000 in 2003.

According to the LVCVA, Las Vegas was the most popular trade show destination in the United States in 2003, with a 25% market share of the largest 200 trade shows in the United States in terms of net square footage, and the fourth most popular convention destination in the United States.

The Venetian Casino Resort contains 16 restaurants and two food courts, and a theater/entertainment complex. The Company recently entered into a long term contract to bring the popular Andrew Lloyd Webber Broadway musical "The Phantom of the Opera" to the Company’s stage in a new production. In addition, the hotel provides a variety of amenities for its guests, including a state-of-the-art health spa operated by Canyon Ranch, with massage and treatment rooms and exercise and fitness areas.

The Venetian hotel has an exhibition space that houses the Guggenheim Hermitage Museum, an art museum featuring masterpiece collections from the Guggenheim Museum in New York, the Hermitage museum in Saint Petersburg, Russia and other museums. The Guggenheim/Hermitage Museum was named the "Best Museum in Las Vegas" by the Las Vegas Review Journal.

The Venetian casino has 116,000 square feet of gaming space and is situated adjacent to the hotel lobby. The Venetian casino floor is accessible from each of the hotel, The Grand Canal Shoppes, the Congress Center, the Sands Expo Center and the Strip. The Venetian casino is marketed to attract a broad base of patrons, with a focus on targeted slot customers and high-end table customers. The Company markets the Venetian casino directly to this gaming market segment using database-marketing techniques, slot clubs and traditional incentives such as reduced room rates and complimentary meals and suites.

Food and beverage revenues were $67.5 million for the six months ended June 30, 2004, representing an increase of $26.6 million or 65.2% compared to $40.9 million for the six months ended June 30, 2003.

Retail and other revenues were $37.7 million for the six months ended June 30, 2004, representing an increase of $0.7 million or 1.9% compared to $37.0 million for the six months ended June 30, 2003.

Operating expenses (including pre-opening and developmental and corporate expenses) were $(95.3) million for the six months ended June 30, 2004, representing a decrease of $316.0 million or 143.2% compared to $220.7 million for the six months ended June 30, 2003.