Line in Sands as casino stocks surge
b y Esther Yu
Macau casino stocks surged yesterday after Sands China (1928) posted a turnaround in June gaming revenues.
The largest gaming operator in Macau saw its share price close up 6 percent at HK$30.05 after announcing its second-quarter results.
Revenues hit US$1.48 billion (HK$11.54 billion), down 16.8 percent from last year, while net profit fell 39 percent to US$237 million, which was within analysts' expectations.
However, the US-based casino operator saw its first monthly growth in mass gaming in two years in June, as revenues rose at both its flagship facilities, the Venetian Macau and Sands Cotai Central.
The market took that as a signal that Macau has bottomed out, resulting in the shares of Wynn Macau (1128), Galaxy Entertainment (0027), and Melco International (0200) rising 7.3 percent, 6.49 percent, and 5.76 percent, respectively, closing at HK$13.20, HK$26.25, and HK$8.08.
Meanwhile, Sands China also said it's opening another new casino - Parisian Macau - on September 13, which it believes can help lower operating costs by US$140 million each year.
The positioning of the Parisian "caters well to both the current Macau market conditions and the long-term growth trends in Chinese outbound tourism," Sands chairman Sheldon Adelson said in a conference call with investors.
The American gambling magnate also took Sands China's June turnaround as an optimistic sign of stabilization.
"We see no good reasons that it is going to reverse again," he said, referring the rise in mass gaming revenues.
Adelson also expressed the possibility of raising dividend payouts as a means to "return excess capital to shareholders."
Source: The Standard