76 Gaming | Stock Watch
Holding their own
In a month that saw Singapore’s first casino open and estimates
that the Lion City’s gaming industry could generate between
US$3 and US$3.7 billion in its first year of operation, Macau casino
stocks continued to perform well
by Ray Chan
A
s Macau settles into a what
everyone expects to be a year
of growth on the back of record
2009 gaming revenues of MOP120 bil-
lion (US$15.5 billion), it is expected that
the city’s casino stocks will prosper.
Looking back a little, Las Vegas
Sands reported a smaller loss in the
fourth quarter of 2009 than in previous
results. The company said its net revenue
was US$1.3 billion in the fourth quarter
of last year, a 17.5 percent increase com-
pared to fourth quarter in the previous
year.
While the integrated hotel and ca-
sino giant still incurred a loss of US$114
million, according to the company’s
fourth quarter results of 2009, the Las
Vegas based casino operator - and par-
ent of Sands China - said its quarterly
loss narrowed as its casinos in Macau
recovered strongly.
Expensive
The key indicator - the EBITDA (earn-
ings before interest tax depreciation and
amortization) - of the their casinos in
Macau was US$251.5 million, slightly
below a Morgan Stanley estimate. The
New York-based brokerage firm expect-
ed LVS EBITDA of US$260 million.
At the same time, Morgan Stanley also
indicated that Sands China is the most
expensive casino stock in Macau. year’s IPO. Sands China still has five un- million in the fourth quarter of 2009,
Sands China put a low-end of the developed sites on the Cotai Strip, two and posted a net loss of US$434 million.
range tag on their IPO price and raised of which are expected to be launched The New York Times and Wall
US$2.5 billion in their Hong Kong Stock next year. Street Journal reported that MGM is
Exchange offering in November last working on a Hong Kong initial public
year, and the company now has about No mirage offering, and is looking to raise about
US$5 billion of cash and cash equiva- MGM Mirage reported that its MGM US$1 billion.
lents on hand. Grand Macau earned operating income Melco Entertainment Limited chief
The stock performance of Sands of US$50 million, while the company’s Lawrence Ho announced net revenue of
China - a majority-owned subsidiary of cash balance was about US$880 million US$400 million. The company’s adjust-
Las Vegas Sands - which operates the as of September 2009. ed EBITDA was US$2.7 million for the
Sands Macao Hotel on the Macau penin- MGM Mirage, the parent group, fourth quarter of 2009, a sharp decrease
sula, the Venetian Macao complex and said it lost US$25 cents per-share, worse from US$22.4 million in the fourth quar-
the Plaza in the Four Seasons Macao on than analyst’s estimate. The company ter of 2008, or an 88 percent decrease
the Cotai Strip - has been flat since last recorded a decline in revenue to US$1.5 from the same period a year earlier.
March 2010
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