|By Steve Green, Las Vegas
SunMcClatchy-Tribune Regional News
Feb. 03, 2011--Las Vegas Sands Corp. on Thursday reported the first fourth quarter 2010 results among Las Vegas Strip casino operators, and they showed strong gains thanks to cost-cutting including a reduction in comps handed out to gamblers.
Sands said net revenue at the Venetian and the Palazzo on the Strip jumped from $266.7 million in the fourth quarter of 2009 to $310.6 million in the fourth quarter of 2010.
These properties produced operating income of $44.4 million in the most recent quarter vs. a loss of $14 million in the 2009 quarter as occupancy improved at the Venetian, though it slipped at the Palazzo.
Revenue per available room at the Venetian in the 2010 quarter was $149, off from $150 in the 2009 quarter. At the Palazzo, it was $160, down from $172 in the 2009 quarter.
Declines in Las Vegas overall casino and room revenue were offset by gains in food and beverage and retail sales as well as efficiencies from cost cutting and lower spending on promotions, Las Vegas Sands said.
Chairman and CEO Sheldon Adelson, in a conference call with analysts Thursday, discussed the company's new strategy in Las Vegas that has resulted in more focus on conventioneers and that has cut promotional allowances 39 percent from the 2009 quarter to $25.4 million in the 2010 quarter.
"We've essentially cut all of our comps except our most highly-rated players," he said. "No more comped rooms. No food and beverage. No showroom credits. We're selling rooms. We see it's resulting in a substantial increase in cash income."
Companywide, Las Vegas Sands earned $273 million, compared to net loss of $113.9 million in the fourth quarter of 2009. Diluted earnings per share in the fourth quarter of 2010 were 34 cents, compared to a loss per share of 17 cents in the prior-year quarter.
With strong results from Asia, Las Vegas Sands said quarterly net revenue hit a record $2.02 billion, up 57 percent, and adjusted property EBITDA -- a profitability measure -- increased 141 percent to a record $738.9 million.
EBITDA means earnings before interest, taxes, depreciation and amortization.
"Strong revenue growth and margin expansion in Macau, together with outstanding results at Marina Bay Sands in Singapore and improving results in Las Vegas and Bethlehem (Pa.), contributed to an industry-leading financial performance," Adelson said in a statement.
"Our business here in Las Vegas remains steady," Adelson said during the conference call.
Adelson said Las Vegas corporate meeting and convention business bookings are improving for 2011 and 2012 and the Las Vegas properties should benefit from a room-booking alliance that begins in April with InterContinental Hotels Group.
The Venetian and the Palazzo, with some 7,100 suites, are attached to Las Vegas Sands' Sands Expo Center, a big player in the Las Vegas convention industry.
Adelson said Las Vegas Sands is looking at expansion opportunities in the United States (Florida, Texas and Massachusetts), Europe and Asia (Japan, South Korea and Taiwan).
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