Las Vegas Sands Corp. (LVS)
Q4 2009 Earnings Call Transcript
February 17, 2010 4:30 p.m. ET

Executives

Daniel Briggs - Vice President, Investor Relations
Sheldon G. Adelson - Chairman and Chief Executive Officer
Michael A. Leven - President and Chief Operating Officer
Robert G. Goldstein - Executive Vice President and President, Venetian Casino Resort, LLC
Kenneth J. Kay - Senior Vice President and Chief Financial Officer
Steven Jacobs - Chief Executive Officer, Sands China Limited
Thomas Arasi - Chief Executive Officer, Singapore

Analysts

Joseph Greff - J.P. Morgan
Felicia Hendrix - Barclays Capital
Cameron Mcknight - Buckingham Financial Group
Larry Klatzkin - Chapdelaine Credit Partners
Janet Brashear - Sanford C. Bernstein & Company
David Bain - Sterne, Agee & Leach
Dennis Forst - KeyBanc Capital Markets
Robin Farley - UBS
Chris Woronka - Deutsche Bank

Presentation

Operator

Good afternoon. My name is Kerry and I’ll be your conference operator today. At this time, I would like to welcome everyone to the Las Vegas Sands Corporation''s Fourth Quarter and Year End Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, press the pound key.

I would like to turn the call over to Mr. Dan Briggs, Vice President of Investor Relations. Thank you. Mr. Briggs, you may begin your conference.

Daniel Briggs

Thank you, operator and good afternoon, everyone and thank you for joining us today. On the call with me today are Mr. Sheldon G. Adelson, our Chairman and Chief Executive Officer, Mike Leven, our President and Chief Operating Officer, Rob Goldstein, Executive Vice President and President of the Venetian and Palazzo, Las Vegas, Ken Kay, our CFO, Steve Jacobs, CEO of Sands China Limited and Tom Arasi, CEO of Marina Bay Sands.

Before we begin, I need to remind you that today''s conference call will contain forward-looking statements that we are making under the Safe Harbor Provisions of Federal Securities Laws. I would also like to caution you that the company''s actual results could differ materially from the anticipated results in those forward-looking statements. Please see today''s press release under the caption forward-looking statements for a discussion of risks that may affect our results. In addition, we may discuss adjusted EBITDA, adjusted net income, adjusted diluted EPS and adjusted property EBITDAR which are non-GAAP measures. A definition and a reconciliation of each of these measures to the most comparable GAAP financial measures are included in the press release. Please note that this presentation is being recorded.

I will now turn the call over to Mr. Adelson.

Sheldon G. Adelson

Thanks, Dan. Good afternoon. Thank you all for joining us today. I will begin the call today by sharing a few general thoughts on the quarter. I will then hand the call over to Mike and the team to provide some additional detail.

In Macau, I''m pleased to report that we generated more EBITDAR from our three properties during the fourth quarter of 2009 than in any other quarter in the company''s history. We continue to lead the Macau market in this most important measure of financial performance. Notwithstanding the often quoted gross gaming market share figures, we firmly believe that EBITDAR is the appropriate measure of overall financial performance and that that growth in this metric, along with increasing returns on net invested capital will translate directly into shareholder value.

Total net revenue at our three properties did increase 25% compared to last year''s fourth quarter, but most importantly, adjusted property EBITDAR increased a whopping 48% across our portfolio of properties in Macau.

At the Venetian Macau, EBITDAR for the quarter was a record $175 million, an increase of over 55% compared to last year''s fourth quarter. EBITDAR margin increased to 30.6%, another quarterly record. The Four Seasons Hotel Macau and Plaza Casino also had its best quarter yet. The strength of our business model in Macau is clearly on display in our quarterly results.

Our focus on the highly profitable mass gaming hotel and retail businesses together with our attention and cost structure and efficiency has allowed us to grow our EBITDAR faster than others in the market that rely more heavily on lower margin segments for growth.

A strong quarterly performance provides momentum as we resume the construction process on our largest Cotai Strip development today, Parcels 5 and 6 directly across the Cotai Strip from the Venetian Macao and Four Seasons Hotel Macao. We like to call that development the game-changer because we believe the addition to the Cotai Strip of a development of that scale at 13.3 million square feet together with its resident cornucopia of world-class attractions in the Manatees [ph] will change the dynamic of Macao quite dramatically.