![]() ![]() ![]() In November, Sands China, its Macao spinoff, raised $2.5 billion in Hong Kong through an I.P.O. Still, the company is optimistic about trends for meetings and conventions in Las Vegas in 2010 and is getting a boost from resurgent business in Macao. In the third quarter, it posted a net loss of $123 million, compared with a year-earlier loss of $32.2 million. Las Vegas Sands, meanwhile, has been struggling because of the sharp downturn on the Vegas strip. It returned to profit in the third quarter after cutting costs at its British casinos and getting higher earnings from its Malaysian gambling resort, posting net income of $109 million after a small loss a year earlier. Genting, based in Malaysia, is Southeast Asia’s largest gambling company and the biggest casino operator in Britain. Adelson also said his resort could recover its capital investment in five years. The Las Vegas Sands chairman, Sheldon Adelson, has been more forthcoming, predicting annual earnings of $1 billion for the resort. In 2004, the Sands Macao recouped its investment in less than a year, but the stand-alone casino cost only $240 million to build. Fischer anticipated that it would take five to seven years for the operators to recoup their investments. Some more bullish gambling analysts are forecasting that the two casinos could generate around $3 billion in revenue in 2010, rising to as much as $4.4 billion in 2011.īased on his own gambling revenue projections, which are lower at $2.1 billion for 2010 and $3.5 billion in 2011, Mr. By comparison, Nevada has a 6.75 percent tax, New Jersey collects 8 percent, Pennsylvania 56 percent and Macao 39 percent. players who deposit more than the Singapore equivalent of $72,000 to play in private salons. ![]() The gambling tax rate in Singapore will be 15 percent for mass market and 5 percent for V.I.P. Gambling revenue in Macao last year totaled more than $14.7 billion, according to the territory’s Gaming Inspection and Coordination Bureau. Taxes are also lower in Singapore compared with Macao, so the casinos should be able to generate better returns over time versus other markets, he said. Fischer said that, unlike Macao, which has 33 casinos, Singapore will have just two. But over time, the returns should ramp up significantly, because the additional capital investment required to run the casinos will be fairly low compared with the initial investment.” “Yes, they’ve spent much more than they planned, but that’s not uncommon with these types of projects. “The returns on invested capital will be lower in Singapore than in Macao or other markets, because the capital expenditure was very, very high,” he said. “I don’t think the market is big enough to have two profitable” resorts.Īaron Fischer, an analyst at CLSA, was somewhat more positive. “I think the gaming revenues will not be enough to justify the capital investments that have been required between the two of them,” said Ben Lee of IGamix Management and Consulting, a gambling consulting firm in Macao. ![]()
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