Sands China has registered a $1.58 billion loss for 2022, as casino revenues fell by 52.3 percent yearly, to just $947 million.
The results come after parent company Las Vegas Sands reported a $166 million operating loss in 4Q22, despite recording a 10 percent yearly increase in net revenue, to $1.11 billion during the period.
Net revenue for Sands China was down 44.2 percent yearly, to $1.6 billion during 2022, ‘mainly driven by a decrease in visitation’ due to travel restrictions resulting from COVID cases in Macau and China.
Speaking about the travel restrictions and pressure the company faced over the year, the group’s CEO Rob Goldstein noted that the group had “operated with a wide range of cost control measures in place […] but maintained our commitments to our employees and avoided mass workforce reductions”.
The Macau government had mandated that gaming operators avoid laying off their local workforce, leveraging the fact that the company was negotiating for its new 10-year gaming license which came into effect on January 1st.
The group’s adjusted EBITDA loss for 2022 amounted to $323 million, down slightly from the previous year’s $341 million.
Sands China notes that so far the company has invested over $15 billion in Macau.
Despite the downturn during the pandemic, the CEO notes that “we believe the Macau market will recover and will benefit in the future from the meaningful infrastructure investments being made in Macau and throughout the Greater Bay Area”.
The CEO points specifically to the Hong Kong-Zhuhai-Macau (HKZM) bridge, linking the gambling hub to the Hong Kong airport, which he notes should “help Macau grow tourism and MICE business in the years ahead”.
The company notes that a $1 billion loan from Las Vegas Sands, repayable in July of 2028, has helped it to ‘strengthen our balance sheet […] to provide funds to support, among other things, the working capital and general corporate purposes of the company’.
As of the end of the year, the company had unrestricted cash and cash equivalents of $790 million.
It’s currently looking to extend its 2018 SCL credit facility beyond its July 31st expiration date, having drawn $1.2 billion under the loan to fulfill its requirements to get a new gaming concession in 2022.
Given that it has restricted cash and equivalents of $912 million that was made available in January of 2023, the company notes it is ‘well positioned to support our continuing operations, fulfill the obligations and commitments under the Concession Contract and complete any construction projects that are underway’.
Under the new concession contract, Sands China has pledged to invest $3.77 billion over the course of its 10-year license, with $3.46 billion going to non-gaming projects.
This includes revamps of its MICE facilities, redevelopment of the garden space in front of The Parisian and expansion of its entertainment offerings at the Cotai Arena.
