Marina Bay Sands sinks to US$113m loss in Q2 on circuit breaker closure

SINGAPORE – Marina Bay Sands (MBS) sank deep into the red in the second quarter of this year, racking up a loss of US$113 million (S$156.5 million) after a near-three-month shutdown.

This is compared to the US$346 million (S$479 million) profit it made between April and June last year, MBS’s parent company Las Vegas Sands (LVS) reported on Wednesday in the US. Both figures refer to Ebitda or earnings before interest, tax, depreciation and amortisation.

No layoffs were reported in LVS’ press release, which said the US casino giant would continue to execute its previously announced capital expenditure programs in both Macau and Singapore. LVS had more than 10,000 full-time employees in Singapore in 2019, it said on Wednesday.

The $9 billion expansion plans announced by Singapore’s two integrated resorts (IR) last year were called into question last week, after Resorts World Sentosa (RWS) announced that it would be laying off staff.

Both MBS and RWS said last week that they will be continuing with their expansion plans, which are slated for completion by 2023 and 2025 respectively.

A note in LVS’s earnings presentation deck stated however that the timing of the MBS expansion is subject to revision based on the impact of the Covid-19 outbreak.

The expansion of primarily non-gaming offerings was announced along with an extension to the exclusive rights for the two to run casinos here until the end of 2030. The Government had said the IRs would be subject to a higher tax rate on all gross gaming revenue if they failed to meet their investment commitments.

MBS’s $4.5 billion expansion includes a fourth hotel tower, an entertainment arena and additional events space.

LVS itself swung to a net loss of US$985 million for the second quarter, compared with net profit of US$1.11 billion in the year-ago quarter. Revenue dived 97.1 per cent to US$98 million from US$3.33 billion previously, on the back on global closures of its casinos due to the pandemic.

In Singapore, both IRs remained shut beyond the two-month circuit breaker, which began on April 7.

Attractions, deemed to be higher risk for transmission of the coronavirus, have been allowed to reopen from this month, subject to capacity limits and approval. Some hotels, including those at the IRs, have also been given the green light to resume operations for staycations.

Both IRs announced the gradual resumption of their operations earlier this month, with casino access limited to members and annual levy holders for now.

MBS said that some venues within the complex, such as the Sands Expo and Convention Centre, theatre and Marquee nightclub would resume later in line with government guidelines.

Its total revenue for the second quarter plunged to US$23 million from US$688 million a year ago. Of this, casino revenue sank US$7 million from US$468 million previously. Other revenue from rooms, food and beverage, mall, convention and retail came in at US$16 million compared to US$220 million previously,

Striking a note of optimism, LVS’s chief executive Sheldon Adelson said in a statement that the company is seeing early stages of recovery in each of its markets, and remains optimistic about an eventual recovery of travel and tourism spending as well as future growth prospects.

“We are fortunate that our financial strength will enable us to continue to execute our previously announced capital expenditure programs in both Macao and Singapore, while continuing to pursue growth opportunities in new markets,” he said.

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