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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