Macau-based integrated resort developer and operator Sands China released its financial results for the year’s first half. The company reported losses of $760 million (HK$5.96 billion), compared to $381 million (HK$2.96 billion) in H1 2021. Sands China explained the poor performance to the impact of the COVID-19 pandemic.
Sands China Continues to Suffer from COVID Restrictions
Sands China is a subsidiary of Las Vegas Sands Corp and operates several casino resorts in Macau. Integrated resorts have been one of the most negatively impacted sectors in the gambling industry during the pandemic, and the Sands China properties have not been an exception.
The Group’s total net revenues decreased 43.5% year-to-year, reaching $915 million (HK$7.18 billion). Adjusted property EBITDA was one of the few financial metrics that could be interpreted positively. The figure shows a loss of $120 million (HK$940 million), compared to 2021’s $234 million (HK$1.82 billion) losses.
In its financial report, Sands China noted that visitors to Macau from mainland China and abroad had remained substantially below pre-pandemic levels due to the government’s anti-COVID policies limiting travel. The operator predicted that the situation was unlikely to improve soon.
Our operations will continue to be impacted and subject to changes in the government policies addressing travel and public health measures associated with COVID-19.Sands China August 2022 financial report
Sands China venues remained open during H1, but visitation suffered due to anti-pandemic measures. The resorts had to implement social distancing requirements such as reduced seating at table games and a decreased number of slot machines. The operator admitted that its financial condition would significantly deteriorate if the situation did not improve.
The Operator Is Prepared to Weather the Storm
Despite the negative results, the situation for Sands China is not unsalvageable. The company has $766 million in reserve and access to $1.04 billion in borrowing capacity. Sands China also received a $1.0 billion loan from its parent company Las Vegas Sands Corp and is prepared to last through the pandemic in hopes of future recovery.
We believe we are able to support continuing operations… and respond to the current COVID-19 Pandemic challenges for at least twelve months.Sands China August 2022 financial report
The operator added that it had sufficient capital to complete its ongoing construction projects and renew its Macau concession. The company also invested in several expenditure reduction endeavors, hoping to minimize non-essential cash outflow.
Sands China remains optimistic regarding its prospects, as it relies on the hope that COVID-19 restrictions will eventually subside and its properties will return to operating at maximum capacity. The company’s casino resorts reported substantial profits pre-pandemic, and they still can generate significant revenue.