Q2 2024 Las Vegas Sands Corp Earnings Call
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unknown: [inaudible]
Speaker Change: Good day, ladies and gentlemen, and welcome to the Sands Second Quarter 2024 Earnings Call. At this time, all participants have been placed on a listen-only mode, but we will open the floor for your questions and comments following the presentation.
unknown: Hey, how are you? Good day, ladies and gentlemen.
Speaker Change: It is now my pleasure to turn the floor over to Mr. Daniel Briggs, Senior Vice President of Investor Relations at Sands. Sir, the floor is yours.
Operator: Good morning, ladies and gentlemen, and welcome to the Sands 2nd Quarter 2024 Earnings Call. At this time, all participants have been placed on a listen-only mode, but we will open the floor for your questions and comments following the presentation. It is now my pleasure to turn the floor over to Mr. Daniel Briggs, Senior Vice President of Investor Relations.
Speaker Change: Thank you, Matthew. Joining me call today are Rob Goldstein, Patrick Dumont,
Daniel J. Briggs: Thank you, Matthew. Joining the call today are Rob Goldstein, Patrick Dumont, Dr. Wilfred Wong, and Brandt Chum. Today's conference call will contain forward-looking statements. We'll be making those statements under the Safe Harbor provision of federal security laws. The company's actual results may differ materially from the results reflected in those forward-looking statements. In addition, we'll discuss non-GAAP measures. Reconciliations to the most comparable GAAP measure are included in our press release.
Speaker Change: Dr. Wilford Wong, and Brandt Chum.
Speaker Change: Today's conference call will contain forward-looking statements. We'll be making those statements under the Safe Harbor provision of federal securities laws.
Speaker Change: The company's actual results may differ materially from the results reflected in those forward-looking statements. In addition, we will discuss non-GAAP measures. Reconciliations to the most comparable GAAP measure are included in our press release. We've also posted an earnings presentation on our website. We will refer to that presentation during the call.
Daniel J. Briggs: We've also posted an earnings presentation on our website. We will refer to that presentation during the call. Finally, for the Q&A, we ask those with interest to please post one question and one follow-up so we might allow everyone with the opportunity to participate. The presentation is being recorded.
Speaker Change: Finally, for the Q&A, we ask those with interest to please post one question and one follow-up so we might allow everyone with the opportunity to participate.
Daniel J. Briggs: I'll now turn the call over to Rob. Thank you, Stephen. Thanks for joining us.
Robert Glen Goldstein: Thank you, Stephen. Thanks for joining us today. Macau market continues to grow; total gain in revenues for the market grew 24% in the second quarter of 2024 when compared to the second quarter of 2023. In addition, mass gain in revenue grew 29% compared to one year ago. We remain confident in future growth in the Macau market. I believe Macau's market growth gain in revenue will exceed $30 billion next year and continue to grow year after year. Our business strategy is predicated on investing in high-quality assets that also have scale. Macau is and always has been a deeply competitive market.
Speaker Change: The presentation is being recorded. I'll now turn the call over to Rob.
Rob: Thanks, Dan, and thanks for joining us today. Macau market continues to grow, total gain in revenue for the market grew 24% in the second quarter of 2024 when compared to the second quarter of 2023. In addition, mass gain in revenue grew 29% compared to one year ago.
Speaker Change: We remain confident in future growth in the Macau market. I believe Macau market gross daily revenue will exceed $30 billion next year and continue to grow year after year. Our business strategy is predicated on investing in high-quality assets that also have scale. Macau is and always has been a deeply competitive market.
Robert Glen Goldstein: Our strategic approach has enabled us to compete very effectively. We have designed our capital investment programs to ensure that we will continue to be the market leader in the years ahead. Our approach allows us to grow fast from the long-term, end large-scale EBITDA and generate industry-leading returns on invested capital. Now, look at our results.
Speaker Change: Our strategic approach has enabled us to compete very effectively. We have designed our capital investment programs to ensure that we will continue to be the market leader in the years ahead. Our approach allows us to grow fast in the long term and generate industry-leading returns on invested capital.
Robert Glen Goldstein: In Macau, we delivered a solid EBITDA for the quarter despite material disruption at Belonga. SEL continues to lead the market in gaining non-even revenue and in market share of EBITDA. We will capture high-value, high-margin tourism over the long term. We have a unique competitive position in terms of scale, quality, and diversity of product offerings. Upon completion of the second phase of the Lund Lunar Avocato Arena, our product managed to be more pronounced than ever.
Speaker Change: Turn to our results in the COW and DO-IT-OR-SOLID EBITDA to record the spike material disruption at Belmondo.
Speaker Change: SGL continues to lead the market in gaming and non-gaming revenue and in market share of EBITDA.
Speaker Change: We will capture high-value, high-margin tourism over the long term. We have a unique competitive position in terms of scale, quality, and diversity of product offerings.
Speaker Change: Upon completion of the second phase of the Lundiner-Avacuta arena, our product managed to be more pronounced than ever. Another strong quarter in Singapore despite ongoing disruptions in construction.
Robert Glen Goldstein: Another strong quarter in Singapore despite ongoing disruptions in construction. The financial results of Marina Bay Sands reflect the positive impact of our capital investment program and the growth of high-value tours. The growing appeal of Singapore as a destination is enhanced by the robust entertainment and lifestyle of that town.
Speaker Change: The financial results of Marina Bay Sands reflect the positive impact of our capital investment program and the growth of high-value tours. The growing appeal of Singapore as a destination is enhanced by the robust entertainment and lifestyle events calendar.
Robert Glen Goldstein: As we complete the balance of our investment program, there will be a considerable runway for growth. Thanks for joining our call. I'll turn it over to Patrick now, and then we'll go to Q&A.
Patrick Dumont: As we complete the balance of our investment program, there will be a considerable runway for growth. Thanks for joining our call. I'll turn it over to Patrick now, and then we'll go to Q&A. Patrick? Thanks, Rob. Mercado Ibidal was $561 million. We had held as expected in our rolling program.
Patrick Dumont: Thanks, Rob. Meccano EBITDA was $561 million. If we had held as expected in our rolling program, our EBITDA would have been higher by $4 million. When adjusted for lower than expected hold in the rolling segment, our EBITDA margin for the Macau portfolio properties would have been 32.1%, or down 80 basis points when compared to the second quarter of 2023. Contacts here are important.
Speaker Change: Our EBITDA would have been higher by $4 million.
Speaker Change: When adjusted for lower than expected hold in the rolling segment, our EBITDA margin for the Macau portfolio properties would have been 32.1%, or down 80 basis points when compared to the second quarter of 2023.
Patrick Dumont: Our margins at Londoner were directly impacted by the disruption of the Londoner Grand renovation. We closed the casino at 1500 keys out during the quarter. Margin at the Venetian was 38.2%, and we expect margin improvement as the Venetian Cotai Arena comes back online later this year. And as visitation to the market and growth and unrated play in the market both increased, Margin at the Plaza and Four Seasons was $40,000. We are now deep into our longer grand renovation. We plan the completion of the first tower by year-end 2024 and of the second tower by May of 2025. The Londoner Grand Casino has been closed since May and is scheduled to reopen in December.
Speaker Change: Context here is important. Our margins at Londoner were directly impacted by the disruption of the Londoner grand renovation. We closed the casino at 1,500 keys out during the quarter.
Speaker Change: Margin at the Venetian was 38.2% and we expect margin improvement as the Venetian Cotai Arena comes back online later this year and as visitation to the market and growth and unrated play in the market both increase in the future.
Speaker Change: Margin at the Plaza and Four Seasons was 40%.
Speaker Change: We are now deep into our London Grand Renovation Program. We plan the completion of the first tower by year-end 2024, and of the second tower by May of 2025.
Speaker Change: The Londoner Grand Casino has been closed since May and is scheduled to reopen in December .
Patrick Dumont: As these products come online, between the end of 2024 and the first half of 2025, our competitive position will be stronger than ever. We expect meaningful EBITDA growth and margin expansion. Now turning to Singapore, MBS's EBITDA came in at 512. Our strong results reflect the impact of high-quality investment in market-leading products and growth in high-value tourism. Had we held as expected at our rolling play segment, EBITDA would have been $64 million lower.
Speaker Change: As these products come online,
Speaker Change: Between the end of 2024 and the first half of 2025, our competitive position will be stronger than ever. We expect meaningful EBITDA growth and margin expansion in the future.
Speaker Change: Now turning to Singapore, MBS's EBITDA came in at $512 million. Our strong results reflect the impact of high-quality investment in market-leading product and growth in high-value tourism.
Speaker Change: Had we held as expected at our rolling play segment, EBITDA would have been $64 million lower.
Patrick Dumont: Had we held as expected in our rolling play segment, NBS margin would have been 48%, or 220 basis points higher than the second quarter of 2020. While we have substantially completed the original $1 billion refurbishment program at MBS, we are still in the initial stages of realizing the benefits of these new products. Tower Gaming at Marina Bay Sands will be offered for the first time at the property in the third quarter of 2024.
Speaker Change: And we held as expected in our rolling play segment, MBS margin would have been 48 percent or 220 basis points higher than the second quarter of 2023.
Speaker Change: While we have substantially completed the original $1 billion refurbishment program at MBS, we are still in the initial stages of realizing the benefits of these new products.
Speaker Change: Tower Gaming at Marina Bay Sands will be offered for the first time at the property in the third quarter of 2024.
Patrick Dumont: The next phase of our capital investment program at Marina Bay Sands is scheduled to be completed during the second quarter of 2025, and this will further support growth in 2025 and beyond. Turning to our program to return capital to stakeholders, we repurchased $400 million in LDS stock during the quarter. We also paid our reoccurring quarterly dividends. We look forward to continuing to utilize the company's capital return program to increase returns to shareholders in the future. Thanks again for joining the call today. Now let's take take some questions.
Speaker Change: The next phase of our capital investment program at Marina Bay Sands is scheduled to be completed during the second quarter of 2025. This will further support growth in 2025 and beyond.
Speaker Change: Turning to our program to return capital to shareholders, we repurchased $400 million in LDS stock during the quarter. We also paid our reoccurring quarterly dividend.
Speaker Change: We look forward to continuing to utilize the company's capital return program to increase returns of shareholders in the future. Thanks again for joining the call today. Now, let's take some questions.
Operator: Thank you. Ladies and gentlemen, the floor is now open to questions. If you'd like to enter the queue to ask a question, please press star 1 on your telephone keypad now. If you are listening on speakerphone today, please pick up your handset to provide optimum sound quality. Also, we ask each participant to limit themselves to one question and one follow-up question. Please hold a moment while we poll for questions. Your first question is coming from Joe Greff from J.P. Morgan. Your line is live.
Speaker Change: Thank you. Ladies and gentlemen, the floor is now open for questions. If you'd like to enter the queue to ask a question, please press star 1 on your telephone keypad now. If listening on speakerphone today, please pick up your handset to provide optimum sound quality.
Speaker Change: Also, we ask each participant to limit yourself to one question and one follow-up question. Please hold a moment while we poll for questions.
Speaker Change: Your first question is coming from Joe Greff from J.P. Morgan. Your line is live.
Joseph Richard Greff: Good afternoon, guys. I'd like to start off in Singapore, if we could. I was hoping, can you give us a sense of maybe how Players and Visitors are performing, you know, geographically, how they're performing, um, more specifically, are you seeing any kind of slowdown, uh, from mainland Chinese visitation or mainland Chinese spend into MBS? And was there any, you know, more material trend change towards the end of the QQ versus maybe what you've seen over the last couple of quarters as that's been sort of a growing segment?
Joseph Richard Greff: Good afternoon, guys. I'd like to start off on single-poor, if we could. I was hoping, can you give us a sense of maybe how
Joseph Richard Greff: Players and visitors for, you know, geographically, how they're performing. I guess more specifically, are you seeing any kind of slowdown?
Joseph Richard Greff: from Mainland Chinese Visitation or Mainland Chinese Spend into MBS? And was there any more material trend change towards the end of the QQ versus maybe what you've seen over the last couple of quarters as that's been sort of a growing segment?
Robert Glen Goldstein: Joe, as you know from previous calls, we have a diverse customer base in Singapore. We've got them all over the region, and certainly, China is part of that. But we're all over the place, Vietnam, Japan, Korea, Indonesia, Malaysia.
Joseph Richard Greff: Joe, you know, we, as you know, in the past calls, we have a diverse, uh, uh, customer base in Singapore. We've got more in the region.
Joseph Richard Greff: And so the Chinese part of that, but we're all over the place, Vietnam.
Robert Glen Goldstein: So, I don't think we're so much different from the past year, except obviously, the seasonality is in play in Q2. But our business in Singapore, the only thing I would say really has impacted it is that we keep self-inflicting wounds by finishing our building. And it's near the end, finally, after it feels like a long time.
Speaker Change: is in play.
Speaker Change: Self-Inflicting Wounds by Finishing Our Building, and it's near the end, finally, after a long time.
Robert Glen Goldstein: But despite seasonality, despite the difficulties of construction, Tower 3, Tower Gaming, we continue to move forward towards 500-plus million-dollar quarters. And the diversity of business tours is very clear to me, where they're coming from. They're coming from everywhere.
Speaker Change: But despite seasonality, despite the difficulties of construction, Tower 3, Tower Gaming, we continue to move forward towards 500-plus million-dollar quarters. And diversity of visitor tours is very clear to me, really, where they're coming from. They're coming from everywhere. We have not seen a slowdown in China. We just simply see the same visits in the last couple quarters, which is solid. But it's also solid from all over the region. So Singapore keeps moving forward. And I think you'll see a real important transition probably in the early part of Q2, when the building is ready, full bore, complete, and Tower Gaming is intact, all the suites are intact. We're really playing the game with one hand behind our back right now, still delivering two-plus-billion-dollar run rates. So I feel very good about that.
Robert Glen Goldstein: We have not seen a slowdown in China. We just simply see the same business in the last couple quarters, which is solid. But it's also solid from all over the region.
Robert Glen Goldstein: So, Singapore keeps moving forward. I think you'll see a really important transition, probably in the early part of Q2, when the building is ready to pull boar, complete, and Tower Gaming is intact, all the suites are intact. We're really playing the game with one hand behind our back right now, still delivering 2-plus billion-dollar run rates. So, I feel very good about our prospects in Singapore. Probably the most, not probably, it is the most, the largest earning EBITDA building in the history of gaming. So, and it continues to get stronger. As we said before, we think our goal is $2.5 billion out of Singapore, and I think you'll see it happen in the coming years.
Speaker Change: [inaudible]
unknown: Great. And then people have not really asked me a question about Macau, saying Macau is self-sufficient or... speaks for itself. But Rob, Patrick, maybe you can give us an update on any development opportunities, you know, specifically Thailand, and I'm not sure there's much to add to what's going on in New York. So first,
Speaker Change: Great. And then people have not really asked me a question about Macav. I think Macav is self-sufficient or...
Speaker Change: speaks for itself. But Rob, Patrick, maybe give us an update on any development opportunities, specifically Thailand, and I'm not sure there's much to add to what's going on in New York.
Patrick Dumont: So first off, I think the great news is we're very ready to develop new ground and developments in new jurisdictions. We're very excited about it.
Speaker Change: So, first off, I think the great news is we're very ready to develop new ground and developments in new jurisdictions. We're very excited about it.
Patrick Dumont: Rob, the team, and I spent a lot of time looking at opportunities for our company to expand and grow new jurisdictions. As you know, we're spending a lot of time in New York. We're spending a lot of time in Texas.
Speaker Change: Rob, the team, I spent a lot of time looking at opportunities for our company to expand and grow new jurisdictions.
Speaker Change: As you know, we've been spending a lot of time in New York, we've been spending a lot of time in Texas, we've been looking at Thailand. I think Thailand is a very interesting opportunity, the market there is very strong for different types of tourism, and I think depending on the way it's set up and the opportunity that's there in terms of structure, it could be very interesting for us.
Patrick Dumont: We've been looking at Thailand. I think Thailand is a very interesting opportunity. The market there is very strong for different types of tourism. And I think, depending on the way it's set up and the opportunity that's there, in terms of structure, it could be very interesting for us. You know, we love the market as a place to source customers. We think the quality of tourism there is quite high. If you go and visit, you'll have a great experience there, and we'd love to be part of it.
Speaker Change: You know, we love the market as a place to source customers. We think the tourism quality there is quite high. If you go and visit, you'll have a great experience there, and we'd love to be part of it.
Patrick Dumont: So if Thailand becomes available, we'd be very interested. But I think it's early days yet. I think we've been spending time there, along with the rest of our industry, looking to see if we could be helpful to that process. And we're waiting and seeing what happens.
Speaker Change: So, if Thailand becomes available, we'd be very interested. But I think it's early days yet. I think we've been spending time there, along with the rest of our industry, looking to see if we could be helpful to that process. And we're waiting and seeing what happens.
Speaker Change: Thank you, guys.
Stephen White Grambling: Your next question is coming from Stephen Grambling from Morgan Stanley. Your line is live.
Speaker Change: Thank you.
Speaker Change: Your next question is coming from Stephen Grambling from Morgan Stanley . Your line is live.
Stephen White Grambling: Hey, thanks. I appreciate the comments on the Londoner grand renovation impacting margins in Macau. But can you get back to 2019 levels in the current environment as that comes through and ramps up, or do we need to see some change, either in growth in the market or the competitive and promotional environment, to get back there?
Stephen Gramling: Hey, thanks. I appreciate the comments on the Londoner Grand Renovation impacting margins in Macau, but can you get back to 2019 levels in the current environment as that
Stephen Gramling: comes through and ramps up, or do we need to see some change either in growth in the market or the competitive and promotional environment to get back there?
Patrick Dumont: So a couple of things, and I think this is really important to note. The Macau market has always been super competitive. From day one, it's been a very competitive market, and we've been very effective in the way that we compete because we have an investment-driven model. So if you go back pre-pandemic, if you go back in 2010, it was a very competitive market. And, in fact, I remember when the premium mass segment didn't exist.
Speaker Change: So a couple of things, and I think this is really important to note, the Macau market has always been super competitive.
Speaker Change: From day one, it's been a very competitive market and we've been very effective in the way that we compete because we have an investment driven model.
Speaker Change: So, if you go back pre-pandemic, if you go back in 2010, it was a very competitive market. And in fact, I remember when the premium mass segment didn't exist.
Patrick Dumont: And when it started, people, you know, Rob can reference this as well, some other people in the room can as well, when there was no premium mass segment, it was really rolling volume and mass. And the market has always evolved over time.
Speaker Change: And when it started, people, you know, Rob can reference this as well, some other people in the room can as well. When there was no premium mass segment, it was really rolling volume and mass play.
Patrick Dumont: But the one thing that's consistent is that our company has driven success through investment and through leading in non-gaming amenities and, to be fair, innovating on the gaming side as well. And so when you look at our performance, if you go to page 14 of the slide deck, you can kind of see what happened in the quarter. So the Venetian Macau did 262 million in EBITDA in the quarter at a 38.2% margin, and it's missing about half its volume of unrated play. So just with the arena out, which is also a very valuable amenity to drive premium mass performance, see the strength of the performance of the Venetian. The same thing's true in the Plaza.
Speaker Change: And the market has always evolved over time. But the one thing that's been consistent is that our company has driven success through investment and through leading in non-gaming amenities.
Speaker Change: And to be fair, innovating on the gaming side as well. And so when you look at our performance, if you go to page 14 of the slide deck, you can kind of see what happened in the quarter. So the Venetian Macau did $262 million of EBITDA in the quarter at a 38.2% margin.
Speaker Change: And it's missing about half its volume of unrated play.
Speaker Change: So, just with the arena out, which is also a very valuable amenity to drive premium-mass performance, look at the strength of the performance of the Venetian. Same thing's true in the Plaza. Look at what the Four Seasons did, 40% margin, $100 million a season.
Patrick Dumont: Look at what the Four Seasons did. 40% margin, $100 million a season. So when we look at the Londoner, we basically took an equivalent property like Melco or an equivalent property to Wynn Palace out of the market for ourselves to renovate. So for us to put up, you know, $550 million in the quarter, in my mind, this is a great result because we know that we have a limiter in place.
Speaker Change: So, when we look at the Londoner, we basically took out...
Speaker Change: an equivalent property like Melco or an equivalent property to Wynn Palace. We took that capacity out of the market for ourselves to renovate it.
Speaker Change: So, for us to put up, you know, $550 million in the quarter, in my mind, this is a great result because we know that we have a limiter in place. We're missing one of a significant portion of what is ultimately going to be one of the best properties in Macau, if not the best property.
Patrick Dumont: We're missing out on a significant portion of what is ultimately going to be one of the best properties in Macau, if not the best property. And if you look at the success of the Londoner right now, if you look at the win per unit per day on the table side, the Londoner is the second best in our system. So, you know, in Macau.
Speaker Change: And if you look at the success of the Londoner right now, if you look at the win per unit per day on the table side, the Londoner is the second best in our system.
Patrick Dumont: So when you think about that, the model has been proven, the investment has been validated, and now we're gonna open up the better half, hopefully by the end of the year in major parts. Suddenly, the limiters are going to come off.
Speaker Change: So, you know, in Macau, so when you think about that, the model has been proven, the investment has been validated, now we're going to open up the better half, hopefully by the end of the year in major part.
Patrick Dumont: So, in my mind, this is a very positive investment for us, and we'll get to the margins. We're already doing it at other properties. It's just a function of the renovation because we're carrying all the costs now associated with a shuttered casino and 1,500 rooms. So the Londoner impact is really one half of it's working. You see the performance, you see the slot win, you see the slot performance win per unit, you see the table win performance, you look at the hotel performance, and the non-gaming amenity performance.
Speaker Change: Suddenly, the limiters are going to come off. So in my mind, this is a very positive investment for us, and we'll get to the margins. We're already doing it in other properties. It's just a function of renovation because we're carrying all the costs now associated with a shuttered casino and 1,500 rooms.
Speaker Change: So, the Londoner Impact is really, one half of it is working, you see the performance, you see the slot win, you see the slot performance win per unit, you see the table win performance, you look at the hotel performance and the non-gaming amenity performance.
Patrick Dumont: And then you look at the side that's shut, and you realize that's the better side, but we're carrying all the costs. The potential for the future is really there. We feel very strong about the potential for the margins to reach where we need to go. And just remember, pre-pandemic, we were at 35, 36% EBITDA margin on the whole normalized basis business in aggregate. So we'd like to believe we're in a good spot.
Speaker Change: And then you look at the side that's shut, and you realize that's the better side, but we're carrying all the cost. The potential in the future is really there. We feel very strong about the potential for the margins to reach where we need to go. And just remember, pre-pandemic, we were 35-36% EBITDA margin on a whole normalized basis business, in aggregate.
Patrick Dumont: You know, we're competing effectively, we have great assets, we're investing for the future, and when we're done, we're gonna have the newest and best products in the market. So we feel very strongly about the path that we're on; it's just gonna take a little bit of time to get there.
Speaker Change: So we're, we'd like to believe we're in a good spot. You know, we're competing effectively, we have great assets, we're investing for the future. And when we're done, we're gonna have the newest and best products in the market. So we feel very strongly about the path that we're on, it's just going to take a little bit of time to get there.
Robert Glen Goldstein: The only structural change we need is to get open. The market is doing $30 billion plus next year. We're going to have the two most important assets in the market speaking to each other. I mean, that's huge.
Speaker Change: The only structural change we need is to get it open.
Speaker Change: Okay, the market's doing 30-plus billion next year. We're going to have the two most important assets in the market, speaking of each other. I mean, that's—each one's going to have—London and Venetian have 7,400 keys between them.
Robert Glen Goldstein: We're going to have London and Venice have 7,400 keys between them. The full power of the Cote d'Arena, all the amenities between those two. I think those buildings will be very, very intertwined and give us, by far, 2 billion plus dollar assets speaking to each other. If Parisian and Four Seasons and Sands keep doing what they're doing, we will be at 3 plus billion dollars, and I think we'll get 2 plus billion.
Speaker Change: The full power of the Cota Tirena, all the amenities between those two. I think those buildings will be very, very intertwined and give us, by far, two billion plus dollar assets.
Speaker Change: Speaking to each other, if Parisian and Four Seasons and Sands keep doing what they're doing, we will be at three plus billion dollars and Singapore will get two plus billion. I believe that sometime in the near future we'll have the highest EVADOT creationist company in history without Las Vegas.
Robert Glen Goldstein: I believe that sometime in the near future, we'll have the highest EVADOT creationist company in history without Las Vegas. So, I'm pretty confident that London will perform and outperform their expectations. I also think it enhances Venetian because the back and forth of those two buildings, they're very similar.
Speaker Change: So, I'm pretty confident that London will perform and outperform their expectations. But I also think you can see the nation, because the back and forth of those two buildings, they're very similar. You know, huge retail, huge suite capacity, entertainment, retail, F&B.
Robert Glen Goldstein: There's huge retail, huge suite capacity, entertainment, retail, and F&B. They're just much bigger and better than anything else in that market for making money. And I think when those come online next year, you add these results today to another $150 million out of London, and all of a sudden, you're looking at, you know, 3 plus billion dollars of annualized EVADOT. That's how we view the market. With margins being what they are, making EVADOT is still the most important thing, and we will get there.
Speaker Change: They just, they're much bigger and better than any else in that market for making money.
Speaker Change: And I think when those come online next year, you add these results today to another, you know, $150 million out of London, all of a sudden, you're looking at, you know, $3-plus billion of annualized EBITDA. That's how we view the market. And margins being what they are, making EBITDA is still the most important thing. And we will get there. We will get there.
Stephen White Grambling: So maybe as a quick follow up, on capital allocation, you noted being consistent with capital return, and it sounds like you're confident in a ramp from here in Macau and really growing in MBS, yet the stock is near, you know, the lows during the pandemic, so what's the tolerance to be maybe not as consistent and actually being more aggressive with capital allocation or even rethinking about the leverage profile, at least in the near term?
Speaker Change: So maybe as a quick follow up on capital allocation, you noted being consistent with capital return, and it sounds like you're confident in a ramp from here in Macau and
Speaker Change: really growing in MBS, yet the stock is near, you know, the lows during the pandemic. So what's the tolerance to be maybe not as consistent and actually being more aggressive with capital allocation or even rethinking about the leverage profile, at least in the near term?
Patrick Dumont: So I think, I think first off, we have said this before, we see meaningful value in both equities where this stock is trading doesn't make any sense to us, both on a historical basis and how we view the value of our company and how we look to invest and grow. So we're going to continue to repurchase stock, and you saw we did in the last couple quarters. We feel fairly strongly about the value of our business, and we're going to continue to do that. Look, I think, for us, we're very focused on being shareholder friendly. We were a very shareholder-friendly company in the past; we're a shareholder-friendly company today.
Speaker Change: So I think I think first off we had said this before we see meaningful value in both equities You know where these where this stock is trading doesn't make any sense to us
Speaker Change: both on a historical basis and how we view the value of our company and how we look to invest and grow. So we're going to continue to repurchase stock as you saw we did the last couple quarters. We feel fairly strongly about the value of our business and we're going to continue to do it.
Patrick Dumont: We're going to continue to do that. That's our goal. And I think that the nice thing is that as we complete the London, or two things are going to happen; we're going to have less CapEx and more free cash flow, and, to be fair, a more productive asset base. And so hopefully, we'll have the opportunity to use that capital to return it to shareholders. So we're going to look to do that and continue what we've been doing. But we agree with you. You think where the stock is today is not reflective of our long-term value. And also, if we do invest in new, new opportunities.
Speaker Change: Look, I think for us, we're very focused on being shareholder friendly. We were a very shareholder friendly company in the past, we're a shareholder friendly company today. We're going to continue to do that, that's our goal.
Speaker Change: And I think that the nice thing is that as we complete the Londoner, two things are going to happen. We're going to have less CapEx and more free cash flow and...
Speaker Change: to be fair, a more productive asset base. And so hopefully we'll have the opportunity to
Speaker Change: Use that capital to return it to shareholders. So we're going to look to do that and Continue what we've been doing, but we agree. If you think where the stock is today, it's not reflective of our long-term value
Patrick Dumont: And also, if we do invest in new opportunities, that's not in the near future; it's years ahead. You know, New York, Texas, Thailand are years ahead in front of us, so there is lots of room to invest money and complete the plan.
Speaker Change: And also, if we do invest in new opportunities, that's not in the near future. It's in New York, Texas, Thailand, the years ahead in front of us. So, lots of room to invest money completely.
Speaker Change: Thank you.
Speaker Change: Thank you.
Robin Margaret Farley: Your next question is coming from Robin Farley from UBS. Your line is live.
Speaker Change: Thank you.
Speaker Change: Your next question is coming from Robin Farley from UBS. Your line is live.
Robin Margaret Farley: Great, thanks. I have two questions. One is, can you kind of share some thoughts on the tariff impact on the Chinese economy next year. And just is there any way to help us think about that broadly, how you're thinking about, you have a lot of CapEx going on, you know, being up and running in the market next year, which should certainly position you well, but just sort of thinking about the broader impact there. Thanks.
Robin Margaret Farley: Great, thanks. Two questions. One is, can you kind of share some thoughts on, there's a lot of concern about tariff impact on the Chinese economy next year. Just is there any way to help us think about that broadly, how you're thinking about, you have a lot of
Speaker Change: Cafex going you know being up and running in the market next year which should certainly position you well but just sort of thinking about broader impact there. Thanks.
Robert Glen Goldstein: What did you say? Tariff impacts on the Chinese? Oh, so the U.S., the new president, whoever he or she may be. I see.
Speaker Change: What did you say? Tariff impacts on the Chinese? Oh, so the U.S.
Robert Glen Goldstein: I don't think we want to talk about it for two reasons. One, we don't know what's really going to happen, nor do we know the impact. Obviously, the Chinese economy speaks for itself.
Speaker Change: The New Presidents ever, he or she may be. I see.
Speaker Change: I don't think we want to talk about it for two reasons. One, we don't know what's really going to happen, nor do we know the impact.
Robert Glen Goldstein: It's been a struggle this year, and I think it, hopefully, just gets better. We see more improvement. But the big thing in our business is the $2 million-plus visit tours we're lacking quarter-on-quarter. They only hurt us, and that's just today. I don't think we should comment on politics or what happened with the test. We don't know. But obviously, the biggest miss for our company, which is both for scale and quality, we lose $8 million in annualized visit tours. It hurts us more than anybody else. So we'll leave it there, going into the political realm of who's going to do what to who and why.
Speaker Change: Obviously the Trans-Economy Speech for itself has been a struggle this year.
Speaker Change: and I think it hopefully just gets better, we see more improvement, but the big thing in our business is the two million plus visitors we're lacking quarter on quarter. Nobody heard us, and neither has this today. I don't think we should comment on politics or what's happened to the test, we don't know.
Speaker Change: But obviously, the biggest miss for our company, which is both for scale and quality, we lose $8 million in annualized visitor tours, and it hurts us more than anybody else. So we'll leave it there, going into the political realm of who's going to do what to who and why.
Robin Margaret Farley: Okay, fair enough. Thanks. And then the question, you already commented on your interest in continuing share repurchases. Looking at the rate that you did this quarter, you'd be mostly through your remaining authorization at the end of this quarter. Is that when we think about your appetite for continuing beyond that? Would you just sort of comment on that? Thanks. Yeah, I think if you
Speaker Change: Okay, fair enough. Thanks. And then the other question, um, you already commented on, you know, your interest in continuing Sherry Purchase.
Speaker Change: Looking at the rate that you did this quarter, you'd be mostly through your remaining authorization at the end of this quarter. Is that, when we think about like your appetite for continuing beyond that, is that, if you could just sort of comment on that.
Patrick Dumont: Yeah, I think if you look at our past practice, you can see that we've always been focused on return of capital, both through shareholder purchases and dividends, and that our board has been very supportive of trying to create shareholder value through return of capital. So as our current authorization gets used up, we'll go back to the board, and we'll have a discussion about how we want to allocate capital, but the board has been very supportive of trying to enhance shareholder returns over time.
Speaker Change: Yeah, I think if you look at our our prior practice, you can see that we've always been focused on return of capital, both through share purchases and dividends.
Speaker Change: And that our board has been very supportive of trying to create shareholder value through return of capital. So as our current authorization gets used up, we'll go back to the board and we'll have a discussion about how we want to allocate capital. But the board has been very supportive of trying to enhance shareholder returns over time.
Speaker Change: Thank you.
Robin Margaret Farley: Thanks Robin. Thanks Robin.
unknown: Hi, everyone. Good evening. Good afternoon.
Speaker Change: Hey everyone, good evening, or good afternoon. Rob, if you could, I mean, I know this is probably a difficult question, but if you think about... Another interview. A long interview. I hear you.
unknown: Yeah, if you could, I mean, I know this is probably a difficult question, but if you think about what I hear you, it's maybe not as difficult as I thought it would be. But when you guys think about the rooms that are out of service at Londoner and and, you know, those customers and
unknown: That's a long unit, I'll admit it.
Robin Margaret Farley: I hear you. My question was... I hear you.
Speaker Change: Maybe it's not as difficult as I as I preempted it to be. But when you guys think about the rooms that are out of service at Londoner and and, you know, those customers and recapture in your existing portfolio, whether you're able to recapture them in Venetian, Parisian or elsewhere.
Speaker Change: What do you think is actually the delta in what you're missing from those rooms being offline? I.e., how much of that shortfall that's being generated there relative to the historical period is actually true?
unknown: Unknown Executive, Shui Choi, Carlo Santarelli, Ying Wong, Vitaly Umansky, Las Vegas Sands Right. Before I get
Speaker Change: Unknown Speaker elsewhere in the portfolio versus how much do you think is just exiting the system and maybe showing up at competitors?
unknown: Right. Before I get this question, Mr.
unknown: Chum, we woke up to a view that's called Middle Lightning Cow. I want to also reference the fact that the disruption of the size of the cowry labor, when you've been in these buildings before, when buildings are under construction, impacts both Level 1 and 2. I want to be clear that the disruption isn't just limited to our current Lunder 2, Lunder 1, which is a beautiful building, also feels the pain. Grant, would you answer the question about the ruins of the belt and how you see that?
Mr. Chung: Right, before I get to this question, Mr. Chum, we woke up to a business called Middle Lightning Cow. I want to just also reference the fact that the disruption of the size of the cowry labor, when you've been in these buildings before, when buildings are under construction, impacts both Lunder and Wynntil. I want to be clear that the disruption isn't just limited to our current, you know, Lunder 2, Lunder 1, which is a beautiful building, also feels the pain. Grant, would you answer the question about the rooms developed and how you see that?
unknown: phase two renovation on the Sheraton site. But actually, despite that, you referenced the fact that we obviously worked hard to shift the patronage to other properties in the portfolio. And the team was actually incredibly successful at that. We actually reached the record high in any quarter on non-rolling drop, as well as the record high in any quarter on slot handle. So in terms of gaming volumes, I think we've managed to sustain the volumes overall.
Grant Chomsky: Yeah, thanks, Rob.
Grant Chomsky: I think first of all, yes, the performance definitely was impacted by the Phase 2 renovation on the Sheraton site.
Speaker Change: But actually, despite that, you referenced the fact that we...
Grant Chomsky: We obviously worked hard to shift the patronage to other properties in the portfolio, and the team was actually incredibly successful at that. We actually reached...
Speaker Change: the record high in any quarter on non-rolling drop.
Grant Chomsky: as well as record high in any quarter slot handle. So, in terms of gaming volumes...
Grant Chomsky: I think we've managed to sustain the volumes overall. However, within the mix...
unknown: However, within the mix, I think what you do lose is some of that base mass, which is where Pacifica Casino was primarily positioned. And also, what you also can see in the numbers is the impact of the loss of the rooms impacting the cash hotel revenue, uh... because obviously when you have fewer rooms we are yielding accordingly and when you lose that cash revenues from the hotel side uh... because you have reduced inventory and we need to shift the customers to other properties and the casino side, that clearly impacts not just EBITDA, but it's a high flow-through segment, business segment, so it obviously impacts the percentage margin as well.
Grant Chomsky: I think what you do lose is some of that base mass, which is where Pacifica Casino was primarily positioned.
Grant Chomsky: And also, what you also can see in the numbers is the impact of the loss of the rooms impacting the cash hotel revenues.
Grant Chomsky: because obviously when you have fewer rooms, we are yielding accordingly, and when you lose that cash revenues from the hotel side, because you have reduced inventory and we need to shift the customers to other properties.
Grant Chomsky: on the webinar.
unknown: Great, thank you. That's helpful. And if I could just one quick follow up. Sorry, go ahead, Rob.
Speaker Change: Great, thank you. That's helpful. And if I could just one quick follow-up. Sorry, go ahead, Rob.
unknown: Yeah guys, do you have a dollar amount on the cash room sales lost in the quarter?
Speaker Change: Yeah, guys, do you have a dollar amount on the cash room sales lost in the quarter?
unknown: I'm sorry, wrong.
unknown: I was asking if you could give us a number for the dollar amount we lost in cash room sales due to the closure of London.
Speaker Change: I'm sorry, Rob. I was asking if you could give us a number for the dollar amount we lost in cash room sales for the closure of London.
unknown: If you look at the actual reduction in cash revenue versus Q1, then you're probably looking at the range of around 15, 20 million. But you can't simply add that back because you've also got to consider that it's the net impact of shifting more rooms into some customer segments and then having fewer rooms to sell. So it's a net impact that's probably not as high as that, but if you're looking at pure cash revenues, then that's the range of impact.
Speaker Change: it
Robert Glen Goldstein: If you look at the actual reduction in cash revenue for versus Q1,
Speaker Change: Then you're probably looking at the range of around, you know, 15, 20 million impact Although you can't you can't simply add that back because you've also got to consider
Speaker Change: That's a net impact of shifting more rooms.
Speaker Change: into some customer segments and then having fewer rooms to sell. So it's a net impact that's probably not as high as that, but if you're looking at pure cash revenues, then that's the range of impact.
unknown: I'm sorry. Your second question was what?
unknown: Yeah, the second question was just more of a technical question. And I get it; Lockheed could go both ways.
Speaker Change: I'm sorry, your second question was what? Yeah, the second question was just more of a...
unknown: But this is the fourth quarter, you know, in a row where hold in Singapore has been very strong on the VIP side. And I think when you look at the last four quarters, close to $30 billion of volume at an almost 4.4% win percentage, it feels a little bit more structural. And I know in your ad back math, you guys are obviously dinging yourselves for a much lower hold. Structural, is there any thought of perhaps changing, you know, what that net metric is, as the normalized hold for that property going forward?
Speaker Change: Technical question. And I get it, Lockheed could go both ways, but this is the fourth quarter, you know, in a row where hold in Singapore has been on the VIP side has been very strong. And I think when you look at the last four quarters, it's close to $30 billion of volume at an almost 4.4% win percentage.
Speaker Change: It feels a little bit more structural, and I know in your ad-back math you guys are obviously dinging yourselves for a much lower hold.
Speaker Change: Structural. Is there any thought of perhaps changing, you know, what that, that metric is, as the normalized hold for that property going forward? It's a great question, and one we still have time on, and I think what you should realize, or I think you do realize, is
unknown: It's a great question, and one we still have time on. And I think what you should realize, I think you do realize this, the world is changing in Baccarat for two reasons. One, paperless gives a better way of quantifying what the hold percentage should be.
Speaker Change: The world's changing in Baccarat for two reasons. Smart Papers gives a better way of quantifying what the whole percentage should be. But also, we've put games on the floor, you know, I'll call it prop bets or side bets that change the whole percentage in Baccarat. And your comment's spot on. We're debating how high we can take it. The team there feels it's understated. And you're right, we keep digging ourselves quarter to quarter.
unknown: But also, we've put games on the floor, you know; I'll call them prop bets or side bets that change the hold percentage in Baccarat. And your comments are spot on. We're debating how high we can take it. The team there feels it's understated. And you're right, we keep dinging ourselves quarter to quarter. And perhaps in the near future, we'll address that, because clearly something is happening here. But again, the smart cable opportunity, which we're deep into now, coupled with the game changes, and Baccarat has been a pretty stable, pretty predictable game for many years, a player, a banker, and a tied pair, it's changing dramatically. Yeah, sure. It's the right question to ask.
Speaker Change: And perhaps in the near future we'll address that, because clearly something is happening here. But again, the smart cable opportunity, which we're deep into now, coupled with
Speaker Change: Pre-predictable game for many years and a player.
Speaker Change: [inaudible]
Speaker Change: We believe that's in play in Singapore. We're not ready today, but we're coming close to a decision this year, perhaps.
Speaker Change: to address that very issue. Because you're right, the team would argue something in play, and it's not simply, you know, better fortunes. There's better mathematics that's being made, and the ability to assess those mathematics through smart tables, et cetera. Patrick, go ahead. Yeah, sure. It's the right question to ask.
unknown: Yeah, sure. It's the right question to ask. We've been following this for a while.
unknown: Some of it depends on what Rob said, or it depends on what Rob said, which is the additional wagers that are available on the game mix that we have on the floor at the time. But it's also, you have to understand propensity. And so you have to observe empirically what people are going to do before you can make that decision. So you'd argue that our theoretical is higher than that.
Speaker Change: We've been following this for a while. Some of it depends on what Rob said, or it depends on what Rob said, which is the additional wagers that are available on the game mix that we have on the floor at the time. But it's also, you have to understand propensity.
Speaker Change: And so you have to observe empirically what people are going to do before you can make that decision. So you'd argue that our theoretical is higher than this.
unknown: But we're going to continue to look at it, and we'll make adjustments as necessary when we think the statistics warrant it. But you're right; it is a very significant adjustment and one that we're going to continue to look at. But our game mix has changed, the availability of rob calls and prop bets, but really, high-ball bets are on the floor now in a very different way than they had been previously, both pre-pandemic and even a year ago, and the patron uptake is very high, and so that is adjusting the way that mix on the floor is being exhibited through gaming win. And so we're going to continue to take a But It's a very good question.
Speaker Change: But we're going to continue to look at it, and we'll make adjustments as necessary when we think the statistics warrant it. But you're right, it is a very significant adjustment, and one that we're going to continue to look at. But our game mix has changed.
Speaker Change: The availability, of course, Rob calls them prop bets, but really high ball bets are on the floor now in a very different way than they had been previously, both pre-pandemic and even a year ago.
Speaker Change: and their patron uptake is very high.
Speaker Change: And so that is adjusting the way that Mix on the Floor is being exhibited through GamingWin. And so we're going to continue to take a look at it, and we'll make adjustments when we feel that it's appropriate. But it's a very good question to ask.
unknown: Thank you very much. Thanks, Carl. Thank you. Your next question is coming from Shaun Kelley. From Bank of America, your line is live.
Speaker Change: There's more there, everybody.
Speaker Change: Thank you. Thank you. Thanks, Carl. As always.
Speaker Change: Thank you. Your next question is coming from Shaun Kelley from Bank of America. Your line is live.
Shaun Clisby Kelley: Hi, good afternoon everyone. For Grant or the team, just wanted to ask if you could get a little more color on just what you think is happening in terms of sort of underlying visitation to the market. I think you capture it well on your slide 19, but we saw or noted a bigger sequential deceleration than we typically see in the second quarter. You know, and my question for you is twofold. Just one, you know; what's driving that?
Shaun Clisby Kelley: Hi, good afternoon, everyone. For Grant or the team, just wanted to ask, can we get a little bit more color on just what you think is happening in sort of underlying visitation to the market? I think you capture it well on your slide 19. But we saw or noted a bigger sequential deceleration than we typically see in the second quarter. And my question for you is twofold. Just one, what's driving that? Is it macro? Is it something you're seeing or hearing out there? And I guess just as importantly, is it continuing at all into Q3? Or what's your expectation for this to this pattern to possibly continue?
Shaun Clisby Kelley: Is it, you know, is it macro? Is it something you're seeing or hearing out there? And, I guess, just as importantly, is it continuing at all in Q3 or what's your expectation for this to possibly continue? Thanks.
unknown: Wilford and Grant McLaughlin. I'll take that one.
Speaker Change: Thanks.
unknown: Yeah, welcome back, Shaun, for this one. Yeah, I think you're right.
Speaker Change: Thanks, Shaun, for the questions.
unknown: The visitation recovery rate has actually reduced. So, you know, that's, that's, that's actually taking account of seasonality when you compare the visitation recovery rate versus the second quarter of 2019, we're about 79%. But we were as high as 90%, 85 to 90% in the past six months, in the past two quarters, and visitation outside of Guangdong. So that does impact, I think Rob referenced it earlier, it does impact, I think, the baseball business, especially I'm Ready to Play. We don't know exactly why, but I think that is a clear feature of this quarter, and it does feed, [inaudible]
Grant Chomsky: Yeah, I think you're right. The visitation recovery rate has actually reduced.
Speaker Change: You know, that's actually taking account of seasonality when you...
Speaker Change: When you compare the visitation recovery versus second quarter of 2019, we're about 79%, but we were as high as 90%, 85 to 90% in the past six months, in the past two quarters.
Speaker Change: So, clearly, there has been, I think, more than just a seasonal slowdown, and that's particularly prominent in...
Speaker Change: in the visitation outside of Guangdong.
Speaker Change: So that does impact, I think Rob referenced it earlier, it does impact, I think.
Robert Glen Goldstein: The Base Pass Business, especially the I'm Ready to Play, we don't know exactly why, but I think that is a clear feature of this quarter and it does feed into
Shaun Clisby Kelley: Thanks, Grant. And then just as a follow-up, I think you also talked about, I mean, obviously, I think you mentioned a number of times that the market is always competitive, always promotional. Could you talk about your own promotional allowance or cadence this quarter? Was it a little higher? Did you need to reinvest a little bit more? I think based on our math, that was possibly the case. Or is it all just mixed? Just kind of how did you see it play out? And kind of how much you're reacting to versus how much are you kind of letting go on market share just because it's not your game?
Speaker Change: as we said, the base mass segment.
Speaker Change: Thanks, Grant. And then just as a follow-up, I think you also talked about, I mean, obviously, I think you mentioned a number of times that the market is
Speaker Change: Always competitive, always promotional. Could you talk about your own promotional allowance or cadence this quarter? Was it a little higher? Did you need to reinvest a little bit more? I think on our math, that was possibly the case. Or is it all just mixed?
Speaker Change: Just kind of how did you see it play out and kind of what do you how much you're reacting to versus? How much are you kind of? Letting kind of letting go on market share just because it's not you know your game
Patrick Dumont: Hey, one thing, I just want to say one thing and then I'll turn it over to Grant. So just note that visitation is very important, and you referenced slide 19 and the fact that there are 2 million visitors missing that were here pre-pandemic. We are geared for scale, and that scale is a very high margin for us because of the volume. And so our mix looks different, our margins look different, and our reinvestment looks different because of the shift of business between non-rated and rated play. That's a very important thing when you look at our results and consider what we're doing today. The mix of business has changed for us pre-pandemic and post-pandemic. So that's one thing.
Speaker Change: Hey, one thing, I just want to say one thing and then I'll turn it over to Grant. So just note that the visitation is very important.
Speaker Change: And you referenced slide 19 and the fact that there's 2 million visitors missing that were here pre-pandemic.
Grant Chomsky: We are geared for scale, and that scale is a very hard margin for us because of the volumes.
Grant Chomsky: And so our mix looks different, and our margins look different, and our reinvestment looks different because of the shift of business between non-rated and rated play. So that's a very important thing when you look at our results and you consider what we're doing today. The mix of business has changed for us pre-pandemic, post-pandemic.
Patrick Dumont: The other thing is, I would also like to highlight that if you look at the margins of our overall operations, they're consistent with prior performance. And when that unrated play returns, and the volumes return of premium mass play, their margins should improve. So yes, we look at reinvestment rates, but we also look at the total business. We like to understand how much money we're actually making on net. So when you look at the business overall, our margin performance and our competitive positioning is actually quite good, given where things are. But I'll turn it over to Grant for some additional details.
Speaker Change: So that's that's one thing. The other thing is, I would also like to highlight that if you look at the margins of our overall operations, they're consistent with prior performance. And when that unrated play returns, and the volumes return of premium mass play, their margins should improve.
Speaker Change: So yes, we look at reinvestment rates, but we also look at the total business. We like to understand how much money we're actually making on net. So when you look at the business overall, our margin performance and our competitive positioning is actually quite good, given where things are. But I'll turn it over to Grant for some additional detail.
unknown: Yeah, thanks, Patrick. Yeah, I think it's a mixture. Firstly, the business mix point that Patrick referenced. And secondly, because we were closing Pacifica Casino and getting ready for that, yes, there is, you know, for a period of time, a high level of reinvestment as we prepare for that shift, which, as I talked about earlier, we did so very successfully, especially in the Parisian, but also the other properties. So those are the main factors. [inaudible]
Grant Chomsky: Yeah, thanks Patrick.
Grant Chomsky: Yeah, I think it's a mixture. Firstly, the business mix point that Patrick referenced.
Grant Chomsky: And secondly, because we were closing Pacifica Casino and getting ready for that, yes, there is, for a period of time, a high level of reinvestment.
Speaker Change: as we prepare for that shift.
Speaker Change: which, as I talked about earlier, we did so very successfully, especially into the Parisian but also the other properties.
Speaker Change: So those are the main factors affecting...
Speaker Change: the reinvestment.
Speaker Change: and the overall margin mix.
Speaker Change: But I think even though there are fluctuations from quarter to quarter, day to day even,
Speaker Change: in terms of tactical, I think we're very clear on our strategy.
Speaker Change: which is that we will compete on the quality and the scale of our asset base.
Speaker Change: And of course, at this point in time, we're hampered because we, we have a number of our key assets out. But when those assets come back online, really from Q4 this year into 2025, we absolutely intend to
Speaker Change: to be competing on that basis.
Speaker Change: because at that point we not only have I think scale we always had but but the sheer quality of product that we'll have at that point at scale I think that will be the fundamental difference from what we had before.
Speaker Change: and we intend to make full use of that in terms of competing for the market.
Speaker Change: Thank you, everyone.
Chad C. Beynon: Thank you. Your next question is coming from Chad Beynon.
John: Thanks, John. Thanks, John.
Speaker Change: Thank you. Your next question is coming from Chad Beynon from Macquarie. Your line is live.
Chad C. Beynon: Afternoon. Thanks for taking my question.
Chad C. Beynon: Afternoon, thanks for taking my question.
Patrick Dumont: On Singapore, which has been consistently strong for several quarters, it appears that there's still some quarterly volatility. I think last quarter, we talked about some big events in the first quarter that drove, you know, non-gaming and obviously VIP play. As we think about the back half of the year, can you help us kind of square what seasonality should look like and if there are any big events that are booked on the calendar in Singapore that could drive additional non-gaming or VIP business? Thanks.
Speaker Change: On Singapore, which has been consistently strong for several quarters, it appears that there's still some quarterly volatility. I think last quarter we talked about some big events in the first quarter that drove non-gaming and obviously VIP play. As we think about the back half of the year, can you help us?
Speaker Change: kind of square what seasonality should look like and if there are any big events that are booked on the calendar in Singapore that could drive additional non-gaming or VIP business. Thanks.
Patrick Dumont: So, typically, 2Q is our trough quarter in the year. And so you saw that in Singapore this quarter. As a practical matter, we were also out of keys because of the renovation of Tower 3. So across the back half of the year, into Q1 of next year, all of that stuff's gonna come back. So the limiters are going to come off.
Speaker Change: So, a couple of things. So, typically...
Speaker Change: 2Q is our trough quarter in the year.
Speaker Change: And so you saw that in Singapore this quarter. As a practical matter, we were also out keys because of the renovation of Tower 3.
Speaker Change: So, across the back half of the year into Q1 of next year, all of that stuff's going to come back.
Patrick Dumont: And so if you look at the tower gaming that we're adding, you look at additional salons that are coming back online. So the renovated gaming areas that are coming back, we're finally going to hit full stride in that building. So even though we put up this quarter and last quarter, which are, I think, the two highest of all time, we have more room to go. We're not operating at full capacity.
Speaker Change: So the limiters are going to come off.
Speaker Change: And so, if you look at the tower gaming that we're adding, you look at the additional salons that are coming back online, some of the renovated gaming areas that are coming back, we're finally going to hit full stride in that building. So, even though we put up this quarter and last quarter, which are, I think, the two highest of all time,
Speaker Change: We have more room to go. We're not operating with full capacity.
Patrick Dumont: And so right now, when we look at Singapore, we see strength in the market. We've geared ourselves to focus on high-value tourism, which is coming into Singapore at a very high level. We are the premier place to visit from an amenity standpoint, entertainment, food, and beverage, and we're benefiting from it. And our hospitality is now second to none, which we spent a lot of years working on, and we're finally there
Speaker Change: And so, right now, when we look at Singapore, we see strength in the market, we've geared ourselves to focus on high-value tourism, which is coming into Singapore at a very high level.
Speaker Change: We are the premier place to visit from an amenity standpoint, entertainment, food and beverage, and we're benefiting from it. And our hospitality is now second to none, which we spent a lot of years working on, and we're finally there. So we're going to start to see this asset continue to grow at our pace.
Patrick Dumont: So we're going to start to see this asset continue to grow and outpace. In terms of the calendar coming up, I can't point to anything other than Formula One that would be fitting the category you just laid out. Formula One happens every year. It's a great event. It's something that's good for Singapore. Our patrons really enjoy it, and we look forward to its success. But in terms of the calendar, unless Grant has something in mind, I can't think of anything other than that right now that's worth mentioning.
Speaker Change: In terms of the calendar up and coming, I can't point to anything other than Formula One.
Grant Chomsky: that would be fitting the category you just laid out. Formula One happens every year. It's a great event. It's something that's good for Singapore. Our patrons really enjoy it, and we look forward to its success. But in terms of calendar, unless Grant has something in mind, I can't think of anything other than that right now that's worth mentioning.
Robert Glen Goldstein: Yep.
Robert Glen Goldstein: Okay, great. I just want you to recognize how this market is so powerful and getting better by the day. And the past few weeks, Q2 is always the weakest flow, excuse me, but still, what's happening in Singapore is almost unheard of in our industry. I mean, everything is coming together, converging, and that thing.
Grant Chomsky: Yep, that's the main one, yep.
Speaker Change: Okay, great. Thank you. You have to recognize how this market is so powerful and getting better by the day. And the past few weeks, Q2 has always been the weakest one.
Speaker Change: [inaudible]
Robert Glen Goldstein: And we're doing these numbers again with capacity constraints. When that goes away, the market will continue to thrive, whether it's F1 or Taylor Swift or who's ever coming next. It's just, there's events are very additive, but that place is a market that just becomes more and more desired by the day, as you can see from the visitation and their quality of visitation.
Speaker Change: Those events are very additive, but that place as a market just becomes more and more desired by the day you see by the visitation and their quality of visitation.
Chad C. Beynon: So, The damn thing will come, but I think our ability will speak for itself. Okay, appreciate it. And then I'm going to ask you to put on your economist hat again, not looking out to future years, but this year, obviously, the triple R cut could, you know, bring some more money back into consumers' pockets in China. Just wondering, in previous cycles, how long that usually takes for it to trickle down. Obviously, you know, we've seen a nice little improvement in some of the July foot traffic.
Speaker Change: So...
Speaker Change: Dan King will come, but I think our building will speak for itself.
Speaker Change: Okay, appreciate it.
Speaker Change: And then I'm going to ask you to put on your economist hat again, not looking out to future years, but this year, obviously, the triple R cut could, you know, bring some more money back into consumers pockets.
Speaker Change: in China. Just wondering in prior cycles how long that usually takes for it to trickle down.
Speaker Change: Obviously, you know, we've seen a
Speaker Change: Nice little improvement in some of the July foot traffic. I don't think it would happen that fast, but is this something, if it's kind of working in terms of some stimulus, you could start to see it in the third or fourth quarter here, just in terms of spend per play trends?
Chad C. Beynon: I don't think it would happen that fast. But is this something, if it's kind of working in terms of some stimulus, you could start to see it in the third or fourth quarter here, just in terms of spend per play trends? Just wondering if you could kind of opine on what we've seen in prior cycles. Thanks.
Speaker Change: Just wondering if you could kind of opine on what we've seen in prior cycles. Thanks. So this is a fascinating question. One thing I'll tell you, this was the highest volumes we ever had in premium mass and slots in a quarter.
Patrick Dumont: So this is a fascinating question. One thing I'll tell you, this was the highest volume we ever had in premium mass and slots in a quarter. So clearly, something positive is happening. I think if you said that the economy was, you know, frothy and doing incredibly well, we'd be doing better. I think that might be a fair statement. You could say that, but in terms of timing or specific economic actions, there are so many different things that could happen that may influence it.
Speaker Change: So clearly, like, something positive is happening.
Speaker Change: I think if
Speaker Change: You said that the economy was...
Speaker Change: you know, frothy and doing incredibly well, that we'd be doing better. I think that might be a fair statement. You could say that.
Speaker Change: But in terms of timing or specific economic actions, there are so many different things that could happen that may influence it. We have no idea. I mean, this isn't anything that we can comment on or have a view on.
Patrick Dumont: We have no idea. I mean, this isn't anything that we can comment on or have a view on other than that we're hopeful that there will be further economic growth and further beneficial economic activity around the greater Bay Area. And, you know, hopefully, we'll be the beneficiaries of that. But in terms of specific comments around timing or things of that nature, it's not something we can really do.
Speaker Change: Other than that, we're hopeful that there will be further economic growth and further beneficial economic activity around the greater Bay Area. And hopefully we'll be the beneficiaries of that. But in terms of specific comments around timing or things of that nature, it's not something we can really do.
Patrick Dumont: Thanks, Patrick. I appreciate it.
Patrick Dumont: Thanks, Patrick. Appreciate it.
Brandt Antoine Montour: Your next question is coming from Brandt Montour from Barclays. Your line is live.
Chad C. Beynon: Thanks, Chad. Thank you.
Speaker Change #100: Your next question is coming from Brandt Montour from Barclays. Your line is live.
Brandt Antoine Montour: I just want to follow up maybe with Grant or anyone on Shaun's question about visitation and maybe just think about what's going on there. I know that we don't have a crystal ball for the future, but in the 2Q, do you think MACR was the biggest factor? Is there still infrastructure friction there with flights to non-Guangdong, particularly, or is there something else that you think is at play as well?
Speaker Change #100: can
Brandt Antoine Montour: I just want to follow up maybe with Grant or anyone on Shaun's question about visitation.
Brandt Antoine Montour: And maybe just, you know, thinking about, um,
Brandt Antoine Montour: You know, what's going on there? You know, I know that we don't have a crystal ball for the future, but in the 2Q, do you think macro was the biggest factor? Is there still infrastructure friction there with flights to non-Guangdong particularly? Or is there something else that you think is at play as well?
unknown: Yeah, thanks, Brett, for the question. Yeah, I don't I don't have specific reasons why we have a slowdown in the recovery rate for non-guangdong. I think what you can say is there is a segment bifurcation here where the premium segments are still doing incredibly well. And you can see, I think it's on slide 18 on Dan's pack.
Brandt Antoine Montour: Yeah, thanks, Brett, for the question.
Speaker Change #102: Yeah, I don't have specific reasons why we have a slowdown in the recovery rate for non-Guangdong.
Speaker Change #103: I think what you can say is...
Speaker Change #104: There is a segment bifurcation here where the premium segments are still doing incredibly well.
Speaker Change #105: As you can see, I think it's on.
Daniel J. Briggs: slide 18 on Dan's pack.
unknown: Actually, this is the highest spend per visitor arrival since the COVID recovery began in any quarter, so clearly at the premium and the strength of spend, very high. But at the same time, I think the lower price points in terms of, say, slot performance are also incredibly strong. So those two factors drove record high volumes in our non-rolling drop and slot handle. But in the middle, especially the base match tables, especially unrated, that is highly correlated to the strength of visitation, and it just wasn't as strong this quarter, even if you adjust for seasonality. So I think we can explain how the segments have performed, but we don't know exactly why the visitation base isn't recovering as fast in the middle, in terms of that base match visitation.
Speaker Change #107: Actually, this is the highest spend.
Daniel J. Briggs: [inaudible]
Daniel J. Briggs: is very high. But at the same time, the
Daniel J. Briggs: I think the lower price points in terms of, say, the slot performance.
Daniel J. Briggs: It's also incredibly strong. So those two factors.
Daniel J. Briggs: It drove record high volumes in our non-rolling drop and salt handle. But in the middle, especially the base mass tables, especially unrated, that is highly correlated to the strength of visitation.
Daniel J. Briggs: and it just wasn't as strong this quarter, even if you adjust for seasonality.
Daniel J. Briggs: So, I think we can.
Speaker Change #108: We can explain how the segments have performed, but we don't know exactly why the visitation base isn't recovering as fast in the middle in terms of that base mass visitation.
Brandt Antoine Montour: Thanks for that Grant. And then on the disruption, you know, the renovation projects, you know, if we were to try and gauge the level of disruption from these projects in the third quarter versus the second quarter, you know, when I know you lose the casino floor for a whole quarter versus a half a quarter, can you can you can you maybe give us some finer points on what else is going to be offline in the third quarter versus the second quarter, room count, etc.
Speaker Change #110: Thanks for that, Grant. And then on the disruption, you know, the renovation projects, you know, if we were to try and gauge the level of disruption from these projects in the third quarter versus the second quarter,
Speaker Change #109: I know you lose the casino floor for a whole quarter versus a half a quarter. Can you maybe give us some finer points on what else is going to be offline in a third quarter versus a second quarter, room count, etc.?
unknown: Yeah, it's good. Yeah, go ahead. Go ahead. Go ahead, please. Yeah, the
Grant Chomsky: Yeah, it's good.
unknown: Yes, the disruption will actually increase from a room perspective, so we're operating around 2,500 keys at Sheraton in the second quarter on average over the quarter, and we expect to be down to about 1,300 keys on average across the third quarter, obviously a higher number of keys in the first half of the quarter and finishing up with fewer keys. And as you said, we will have a full quarter of Pacifica Casino closure versus 60-65% of the quarter in the second. So yes, the disruption impact will actually increase during the third quarter.
Grant Chomsky: You go ahead. Go ahead. Go ahead. Please. Yeah, the yes the disruption will
Grant Chomsky: We're actually increased from room perspective. So we're operating around 2,500 keys at Sheraton in second quarter on average over the quarter and we expect to be down to about 1,300 on average across the third quarter obviously
Grant Chomsky: [inaudible]
Grant Chomsky: 65% of the quarter in the second quarter. So yes the disrupt, the disruption impact will actually increase during the third quarter.
Speaker Change #111: Perfect. Thanks, everyone.
David Brian Katz: Thank you. Your next question is coming from David Katz from Jeffries. Your line is live.
Speaker Change #111: Thank you.
Speaker Change #112: Your next question is coming from David Katz from Jeffries. Your line is live.
David Brian Katz: Afternoon, everyone. Thanks for taking my question. I wanted to go back to the repurchases and just take a little bigger picture. Look, right.
David Brian Katz: Afternoon, everyone. Thanks for taking my question.
David Brian Katz: I wanted to go back to the repurchases and just take a little bigger picture look, right? Just thinking about the factors, obviously the stock.
David Brian Katz: and where it is is one of them. But when we look at your capabilities, that there are some, you know, maturities out there, you know, in the future, there's obviously the issue of the float, you know, at the current run rate.
Patrick Dumont: Just thinking about the factors, obviously, the stock and where it is is one of them. But when we look at your capabilities, there are some, you know, maturities out there in the future. There's obviously the issue of the float, at the current run rate, that shrinks the float, and that's a consideration that some companies think about. If you could just sort of walk us through, you know, how you're thinking about those other issues, you know, in view of all of them, that would be helpful, please.
Speaker Change #114: You know, that shrinks the float, and that's a consideration that some companies think about. If you could just sort of walk us through, you know, how you're thinking about those other issues, you know, in view of all of them, that would be helpful, please.
Patrick Dumont: So all very good questions, all things we talk about all the time, consider with the board, and think about frequently. I think the key thing for us is that we always look to invest for growth. So when you think about capital allocation, our primary conversation is, "How do we grow this business?". We had a question earlier about new jurisdictions; we're looking at them.
Speaker Change #115: So all very good questions, all things we talk about all the time, consider with the board and we think about frequently. I think the key thing for us is we always look to invest for growth.
Speaker Change #115: So when you think about capital allocation...
Speaker Change #115: Our primary conversation is, how do we grow this business? We had a question earlier about new jurisdictions. We're looking at them.
Patrick Dumont: If you look at our Las Vegas sale, the fundamental driver of that was our ability to reallocate capital to growing markets and new growth opportunities. And I think our investments in Macau and Singapore will prove out, and that will ultimately allow us to grow those businesses and create additional cashflow, which will ultimately be used for either new growth or shareholder return. And so when you look at our balance sheet, we think being investment grade is incredibly important.
Speaker Change #115: If you look at our Las Vegas sale, the fundamental driver of that was our ability to reallocate capital.
Speaker Change #115: to faster-growing markets and new growth opportunities.
Speaker Change #115: and I think our investments in Macau and Singapore will prove out and that will ultimately allow us to grow those businesses, create additional cash flow which ultimately will be used for either new growth or shareholder return.
Speaker Change #115: And so when you look at our balance sheet, we think being investment grade is incredibly important. We think it provides us with a strategic advantage. It reduces our cost of debt capital, which impacts our overall cost of capital, and makes the financing of new projects more efficient.
Patrick Dumont: We think it provides us with a strategic advantage; it reduces our cost of debt capital, which impacts our overall cost of capital and makes the financing of new projects more efficient and creates better returns for equity. And also, to be fair, we think when we go to new jurisdictions, it puts us in a more competitive position because we have the financial capability to execute the projects we're proposing. And so all of these things are very helpful for us as we look for our business.
Speaker Change #115: and creates better returns for equity. And also, to be fair, we think when we go to new jurisdictions, it puts us in a more competitive position because we have the financial capability to execute projects we're proposing.
Speaker Change #115: And so all of these things are very helpful for us as we look for our business.
Patrick Dumont: When it comes to capital return, I think the idea of shrinking the share count is something we've talked about previously, where we think there's a benefit to doing so. We think there is a positive gearing towards shareholder purchases. We've been very aggressive over the last couple of quarters.
Speaker Change #116: When it comes to capital return, I think the idea of shrinking the share count is something we've talked about previously, where we think there's a benefit to doing so. We think there's positive gearing towards share purchases. We've been very aggressive over the last couple quarters. We'd like to continue to shrink the share count over time.
Patrick Dumont: We'd like to continue to shrink the share count over time. And to be fair, we're also a dividend company. We think that's helpful to shareholder returns. As an S&P 500 member, we think it's good to have a dividend as well.
Speaker Change #116: And to be fair, we're also a dividend pair. We think that's helpful to shareholder returns as an S&P 500 member. We think it's good to have a dividend as well.
Patrick Dumont: So I think, you know, we have the free cash flow to continue the return of capital. We're very happy about that, given our investment opportunities. We have the balance sheet strength to be able to develop new jurisdictions, and so I think you're going to see a balance between growth and our ability to return capital over time. I think the nice thing is when we're done with The Londoner and we're done with some of the other major innovation projects in Singapore, given the growth that we're seeing, we'll hopefully have the ability to return more capital, and we'll have the ability to increase our program and benefit shareholders.
Speaker Change #116: So I think, you know, we have the free cash flow to continue the return of capital. We're very happy about that, given our investment opportunities. We have the balance sheet strength to be able to develop the new jurisdictions. And so I think you're going to see a balance between growth and our ability to return capital over time. I think the nice thing is…
Speaker Change #116: When we're done with the Londoner and we're done with some of the other, with these major innovation projects in Singapore, given the growth that we're seeing, we'll have the ability hopefully to return more capital and we'll have the ability to increase our program and benefit shareholders.
Patrick Dumont: So you'll see us do that over time as our business continues to operate and grow. And so, you know, I think the idea of shrinking the share count is, I think we're in a good position to do it. I think we have a lot of liquidity out there in the market, and a very strong ability to execute. So I think we're in good shape in terms of our program and the way that we approach it.
Speaker Change #116: So you'll see us do that over time as our business continues to operate and grow. And so, you know, I think the idea of shrinking the share count, I think we're in a good position to do it. I think we have a lot of liquidity out there in the market.
Speaker Change #116: Very strong ability to execute, so I think we're in good shape in terms of our program and the way that we approach it.
David Brian Katz: Thank you. I appreciate it.
Speaker Change #117: Thank you. Appreciate it.
Daniel Brian Politzer: Thank you. Your next question is coming from Dan Politzer from Wells Fargo. Your line is live.
David Brian Katz: Thank you, David.
Speaker Change #118: Thank you. Your next question is coming from Dan Politzer from Wells Fargo. Your line is live.
Daniel Brian Politzer: Good afternoon, everyone. Thanks for taking my questions.
Daniel Brian Politzer: Hey, good morning everyone, or good afternoon everyone. Thanks for taking my questions. Um, the first one on Singapore, uh, the ADR was very impressive, um, you know, trends there seemed overall pretty good despite a subdued visitation. Can you talk about, are you starting to see the benefits of the existing CapEx that you've put into the ground so far? And, you know, should we think about any disruption as it relates to Tower 3 that, you know, leading up to the completion next year?
unknown: The first one on Singapore, the ADR was very impressive. Trends there seem overall pretty good despite a subdued visitation. Can you talk about whether you are starting to see the benefits of the existing CapEx that you've put into the ground so far? And should we think about any disruption as it relates to Tower 3 leading up to the completion next year?
unknown: Thank you. Yeah, obviously, the money put into the building thus far is [inaudible] The road ahead in Singapore looks very positive to us. We think $500 million, $550 million, $600 million a quarter is within reach in the near future. And as we referenced earlier, once the entire building is complete in 2025, I think we'll see better numbers than ever in Singapore. It's a very rosy picture in Singapore, and yes, the capex in Toyota is paying off very well.
Speaker Change #120: Thank you. Yeah. Obviously, the money we put into the building thus far is...
Speaker Change #120: [inaudible]
Speaker Change #121: and Chad Beynon back and trying to get through it.
Speaker Change #122: The road ahead, we think, looks very positive to us. We think $500 million, $550 million, $600 million a quarter is in reach in the near future. And as you referenced earlier, once the entire building is complete in...
Speaker Change #122: You know, 25, I think we'll see better numbers than ever out of Singapore. It's a very, very rosy picture in Singapore. And yes, the CapEx in Toyota is paying off very well. And we think it's going to continue getting stronger in time.
unknown: And we think it's going to continue getting stronger over time. And as for ADR, while it's relevant, our cash sales are not the driver. The drivers are our casino business, especially our non-growing casino drop in the table stock rupture. But it's a very positive picture. The disruption is real for the balance of the year in Q1 and Q2. But once that burns off and we get Tower Gaming open and the full complement of suites, I think you're going to see Singapore just continue to be stronger.
Speaker Change #123: And as for ADR, while it's relevant, our cash sales are not the drivers, the drivers is our casino business, especially our non-going casino drop in the table side, rock rupture.
Speaker Change #123: But it's a very positive picture. The disruption is real for the balance of the year and the Q1 and Q2. But once that burns off and the tower gate opens and the full complement of suites, I think you're going to see Singapore just continue to be stronger and stronger.
Speaker Change #124: Thanks. And then, as far as it relates to the Macau property portfolio, obviously, there's a lot of catbacks going into London. Is it related to the other properties there? Is there anything that we should be thinking about?
Speaker Change #125: You start to wrap up London or towards later this year, or, you know, should we expect 2025 to be pretty much disruption?
unknown: Yeah, good point. London will wrap up again in 2025. We should note that we are going to undergo, it was a misunderstanding, perhaps, one call about what happened in Venetian. We are going to rehab some of the rooms in Venetian because we always do. But it's typical, you won't see it in the numbers, the building will be, you know, hidden from the public view by doing it the floor-by-floor traditional way you approach these things in our industry.
Speaker Change #126: free there.
Speaker Change #127: Yeah, good point. London will wrap up again in 25. We should note that we are going to undergo, it was a misunderstanding, perhaps one call about what happens in Venetian. We are going to rehab some of the rooms in Venetian, because we always do. But it's typical, you won't see it in the numbers, the building will be, you know, hidden from the public view by doing the four by four traditional way you approach these things.
unknown: So, we will undergo a renovation of the room product at Venetian next year at the closure of London or renovation. Four seasons pretty much are done. And then we'll sit and see what we want to do with, if we want to sit in Parisian and perhaps in Sands. But nothing beyond that you should think about for the time being.
Speaker Change #127: We will undergo a renovation of the room product at Venetian next year at the closure of the London renovation. Four seasons pretty much is done. And then we'll sit and see what we want to do with the Parisian and perhaps the Sands. But nothing beyond that you think about for the time being.
Speaker Change #128: Got it. Thanks so much.
Steve Wojcicki: Thank you. Your next question is coming from Steve Wojcicki from Stifel. Your line is live.
Dan: Thanks, Dan.
Speaker Change #130: Thank you. Your next question is coming from Steve Wojcicki from Stifel. Your line is live.
Steve Wojcicki: Hey guys, good afternoon. So Grant, you've been asked a question on visitation twice now. I'm actually going to try to ask it a third time. So if we look at slide 20, it shows that the group visitation was, I think we had about 1.3 million visitors in May and June so far. So I want to ask more about kind of what's going on with the group side and just trying to figure out, you know, maybe it has gotten, you know, maybe too expensive and is pricing certain groups out of the market? And I hope that kind of makes sense.
Steve Wojcicki: Yeah, hey guys, good afternoon.
Steve Wojcicki: Grant, you've been asked a question on visitation twice now. I'm actually going to try to ask it a third time. So if we look at slide 20, it shows that the group visitation was I think we've done about 1.3 million visitors in May and June so far.
Speaker Change #132: you know, so I want to ask more about kind of what's going on with the group side and just trying to figure out, you know, maybe has it, you know, do you think Macau has essentially gotten, um, you know, maybe too expensive and is pricing certain groups?
Speaker Change #133: You know, out of the market, and I hope that kind of makes sense.
unknown: Yeah, thanks for the question. I think the two groups are a broader supply chain issue and a change in consumer habits, not just applicable to the Macau market but to all the key markets that were significant to group markets prior to COVID. I think the other aspect that I should have mentioned; perhaps I could get Will to give his perspective as well. Actually, during this period, we also have a series of significant announcements on policies that would boost visitation over time, even though in this current quarter, the impact may not be prominent, ranging from the individual visitor scheme expansion to other types of visa relaxation. So I think we need to bear that in mind that things are actually moving extremely positively on the policy side to support future growth in visitation. Um, Wilfred, maybe you want to add to that? Sure.
Speaker Change #134: Thanks for the question. I think the two groups is a broader
Speaker Change #135: The supply chain issue and the change in consumer habits, not just applicable to the Macau market, but to all the key markets that were significant to group markets prior to COVID.
Speaker Change #135: I think the other aspect that I should have mentioned...
Speaker Change #136: and perhaps I could get some...
Speaker Change #136: Will Ferg to give his perspective as well. Actually, during this period, we also have a series of significant announcements on policies that would boost visitation over time.
Will Ferg: Even though in this current quarter, the impact may not be prominent, ranging from individual visitor scheme expansion to other types of visa relaxation.
Will Ferg: So I think we need to bear that in mind, that things are actually moving extremely positively on the policy side to support future growth in visitation. Wilfred, maybe you want to add to that?
unknown: Sure. I think the government, both at the Macau level and at the national level, is monitoring the situation. And that's why you see the recent announcement that there are an additional 10 cities that people that qualify for IVS. And if you look at Macau, traditionally, about 55-60% of the visitors use the IVS scheme. And this time, they added 10 cities, which have close to 60 million population, so you're increasing that catchment area.
Wilfred: Sure, I think the government, both at the Macau level and at the national level, is monitoring the situation, and that's why you see the recent announcement that there's an additional 10 cities.
Wilfred: that people that qualify for IVF.
Speaker Change #140: And if you look at Macau traditionally, about 55-60% of the visitors use the IVS scheme.
Speaker Change #140: And this time, they added 10 cities.
Wilfred: which has close to 60 million population, so you're increasing that catchment area.
unknown: And I think the other measures, such as a faster and nationwide application for business visa, will also benefit Macau. It will take time for these policies to be fully promulgated and known in these cities, but we're expecting some positive impact in the months to come.
Wilfred: and I think...
Wilfred: The other measures such as a faster and nationwide application for business visa will also benefit Macau. So it will take time for these policies to be promulgated, fully promulgated.
Speaker Change #139: and Nome in these cities, so we're expecting some positive impact in the months to come.
Steve Wojcicki: Okay, great. Thanks, guys. That's all for me. I appreciate it.
Speaker Change #141: Okay, great. Thanks, guys. That's all for me. Appreciate it.
Operator: Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. We thank you for your participation.
Speaker Change #142: Thank you ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. We thank you for your participation.