Las Vegas Sands Corp. (LVS) Q4 2010 Earnings Report, Transcript and Summary

Sheldon Adelson - Chairman, Chief Executive Officer, Treasurer, Member of Nominating & Governance Committee, Chairman of Las Vegas Sands LLC and Chief Executive Officer of Las Vegas Sands LLC Michael Leven - President, Chief Operating Officer, Assistant Secretary, Director, Chairman of Nominating & Governance Committee, Chairman of Advisory Committee, Acting Chief Executive Officer of Sands China Ltd, President of Las Vegas Sands LLC and Chief Operating Officer of Las Vegas Sands LLC Kenneth Kay - Chief Financial Officer and Senior Vice President Daniel Briggs - Investor Relations Robert Goldstein - Executive Vice President, President of Global Gaming Operations, President of Palazzo resorts in Las Vegas and President of Venetian Casino Resort LLC

Shaun Kelley - BofA Merrill Lynch David Katz - Jefferies & Company, Inc. Lawrence Klatzkin - Jeffries & Co. William Lerner - Deutsche Bank Securities Felicia Hendrix - Barclays Capital Janet Brashear - Bernstein Research Cameron McKnight - Buckingham Research Group, Inc. Joseph Greff - JP Morgan Chase & Co Mark Strawn - Morgan Stanley Robin Farley - UBS Investment Bank

Good afternoon. My name is Carrie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Las Vegas Sands Corp. Fourth Quarter Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Mr. Daniel Briggs. Thank you, Mr. Briggs. You may begin your conference.

Thank you, operator. Before I turn the call over to Mr. Adelson, let me remind you that today's conference call will contain forward-looking statements that we are making under the Safe Harbor provisions of Federal Securities Laws. The company's actual results could differ materially from the anticipated results in those forward-looking statements. Please see today's press release, under the caption Forward-Looking statements for a discussion of risks that may affect our results. In addition, we may discuss adjusted net income, adjusted diluted EPS and adjusted property EBITDA, which are non-GAAP measures. A definition and a reconciliation of each of these measures to the most comparable GAAP financial measures are included in the press release. Please note that this presentation is being recorded. With that, let me introduce, our Chairman, Mr. Sheldon Adelson.

Thanks, Dan. Thank you for joining us today, and Happy Chinese New Year. Kung hei fat choi to everyone. I'm sure each of you is busy looking over our press release, but let me take this opportunity to provide some commentary on yet another record-setting quarter for the company and then we'll get to your questions. I'm very proud to say that in addition to the company achieving another record quarter, we also just concluded the most successful year in our history. Net revenue for 2010 was $6.85 billion, a 50% increase over the $4.56 billion achieved in 2009. That's a 50% increase in gross revenue. The company's consolidated EBITDA for 2010 was in excess of $2.2 billion compared to $1.09 billion in 2009, an increase of more than 100% and a figure which strongly reflects our continued growth. It would take too long to list the various successes the company achieved this past year, but I would like to thank our management team and each of our team members across the globe for the role they played in our success in 2010. Our EBITDA has now increased in six consecutive quarters, and I am confident that growth will continue in 2011, a belief which is already validated by our results in the just completed month of January. Let me now make a couple of quick comments on the strong business quarter. Net revenue for the fourth quarter was a record $2.02 billion, an increase of nearly 57% compared to $1.28 billion in the same quarter a year ago. Adjusted EBITDA for the fourth quarter was a record $739 million, up 141% from the same quarter in 2009, and as I noted before, the company's consolidated EBITDA has now increased each quarter since the second quarter of '09. Quite a record. With the opening of Marina Bay Sands as an obvious catalyst, company-wide property EBITDA grew from $371 million in the first quarter of 2010 to $739 million in quarter four, a nearly 100% increase. We saw significant EBITDA increases across our operations in 2010. Our combined Macau properties, and this is all organic growth, increased EBITDA 47.5% compared to 2009. In Las Vegas, EBITDA increased 19.7% for the year, while Sands Bethlehem saw its EBITDA increase 144% in the last two quarters of 2010 versus the last two quarters of 2009, which were the first two complete quarters after the property opened. EBITDA margin for the fourth quarter of 2010 increased 1,209 basis points to a record 36.7% compared to 23.8% in the fourth quarter of 2009. Margin increases in Macau, Las Vegas and Bethlehem along with the high margin Singapore operation all contributed to the increase. Adjusted diluted EPS was $0.42 in the fourth quarter of 2010 compared to just $0.03, a paltry $0.03, in the fourth quarter of '09. Let me now take a few minutes -- by the way, what I want to say is that a fully diluted number would be 860 million shares compared to the about 680 million shares that are listed in some of the wire services. So fully diluted brings it up to 800 million. I don't have, maybe Ken will give us this later, how much it would be on the number of shares that is generally thought of.

The diluted number at the end of the quarter was 806 million as opposed to your 860 million.

No what I want you to say is in the Q&A period, I'd like you to say what it is, what the earnings are per share on the 600 million and I think 79 million shares that are indicated on the wire services summaries. Let me now take a few minutes discussing our various operations starting with Singapore. During the first quarter of 2011, most of the major remaining elements of Marina Bay Sands will be launched, including the ArtScience Museum and the Light and Water show on the bay, as well as the opening of The Lion King. These events will all drive additional visitation and produce increased earnings at the property. We're leaving there this coming week, the end of this coming week, to be there for the opening of the ArtScience Museum on the 17th of this month. Our MICE business continues to grow and, in fact, the property was just named "Asia's Best MICE Hotel" by a leading convention and exhibition publication. This has sparked a friendly rivalry between Marina Bay Sands and the winner of this award for the previous two years, our own Venetian Macao. What's important about this distinction is that it mean Las Vegas Sands now owns the two best MICE facilities in what is still one of the fastest growing regions in the world. On a macro level in Singapore, thanks to the contributions of both IRs [Integrated Resorts], visitor arrivals there have increased by more than 20% from 2009 and each month of the year, respectively, set a new record for visitor arrivals. Let me say that while Marina Bay Sands is really still in its infancy, we are extremely pleased with the property's results and its position in the market. In 2003 the year before we opened the Sands Macao, Macau was roughly a $3.5 billion gaming market. The conventional wisdom was that someday it would even surpass Las Vegas to become the world's top gaming market. While nobody, and I mean nobody, would have predicted that in a span of seven years, it would be four times the size of Las Vegas to $23.5 billion in 2010. Early estimates on the size of the market in Singapore have clearly been conservative as well. The Singapore market is still emerging and as we near the completion of our properties original master plan, which includes its own subway stop to open in 2012, the market is all but certain to grow. As for our results this past quarter, we are extremely happy with the growth of our highest margin mass gaming business in Singapore. Overall, gross Gaming revenue from our mass tables and slots increased 11.9% to $310 million versus $277 million in the third quarter. Non-rolling drop grew more than 5% from the third quarter to the fourth quarter, a run rate of 20% plus annual growth. Our slot handle was up an amazing 35% from the third quarter. Our slot win per unit per day was up 12.5% sequentially, even though we increased capacity during the quarter. Right now, we are in the process of adding 300 more units because the market demands it. Turning to the VIP segment now. If we annualized the results from the third and fourth quarter, our rolling win would exceed $1 billion just from the rolling VIP program. But that is just right now in the infancy of the market. We are confident that number will grow as the market matures just like Macau did. We're confident that number will grow as the market matures, and we're still learning the seasonality of the business there. We haven't even been through our first Chinese New Year in Singapore, which we think will be a huge positive catalyst for our rolling program. We did see some softness in November, but that was book ended by a strong Golden Week period in October and healthy volumes during the December holidays. Remember, we are earning while we are learning in Singapore. We are adding experienced Asian casino executives to our sales team there, and we've just recently enhanced our private aircraft capabilities in the region, allowing us to transport our high volume of premium customers. The potential in Singapore is clearly promising especially when you remember these two things: Singapore is located in the heart of the world's fastest growing region, and we only have one competitor with whom to share this exciting new market. Turning to Macau. Sands China Ltd. completed yet another record quarter. Net revenues increased more than 13% to $1.1 billion. However, property EBITDA for the quarter increased 36.7% to $333 million versus $243 million in 2009. These are all same-store sales. On the topic of EBITDA, and we touched on this a bit last quarter, it continues to be a misplaced infatuation on gross Gaming revenue in Macau. While pundits scrambled to report our market share figures based upon gross Gaming revenue, we believe EBITDA should be the true metric on which performance is judged. That is where our focus lies, making it matter at the bottom line. For example, in the third quarter of 2010, that's because not everybody's coupon numbers are out yet, a percentage of market EBITDA was more than double that of SJM, who had 30% of the gross revenue but less than 15% of the EBITDA. In the third quarter of 2010, Wynn Macau and SJM accounted for roughly 44% of the market's gross Gaming revenue, but only 35% of the market's EBITDA. Sands China, on the other hand, had slightly less than 20% of the gross Gaming revenue, but nearly as much EBITDA as those two competitors combined at about 34% of the market's total EBITDA. Remember, you can't put those Gaming revenue in the bank. Turning to operations in the U.S. Our business here in Las Vegas remains steady. We continue to see an increase in MICE bookings through 2011 and into 2012 and the launch of our exclusive marketing alliance with InterContinental Hotel Group. It's set for the end of this current quarter. The Pennsylvania Sands Bethlehem set records for both EBITDA and EBITDA margin, and we're looking forward to additional opportunities to grow our business there, starting with the opening of our 300-room hotel this May. We're also making significant progress on other pieces of our development plans for Bethlehem, and we'll be sharing additional detail in the weeks to come. Finally, let me finish my prepared remarks by taking a few minutes to discuss our ongoing efforts to fill our development pipeline. As many of you have heard me say, Marina Bay Sands is the greatest reference site a development company could ever hope to have. Since its opening, we have visited with government and tourism officials from a variety of countries at their request. Mike Leven and I along with other members of our development staff have traveled to several different countries to discuss the possibility of developing a Marina Bay Sands-like integrated resort and in some cases, a Coat-tie [ph] Strip-type development. A history of winning competitive bids on our track record of running highly successful IRs should make us the logical choice and most favored company for places such as Japan, Korea or Taiwan as those countries move closer to improving integrated resorts. We are also looking at other countries in Europe as an example, but these are the three countries in the Far East with whom we're having conversations. Closer to home, we are following the process in Florida, Texas and Massachusetts and if the economics there provide a successful development opportunity, we will surely consider it. We pull through our future opportunities with the same development strategy. Such strategy is simple: realize the significant return on our investment and maximize value for our shareholders. So with that, Mike, Rob and Ken are also here to answer your questions. So let's go to Q&A.

[Operator Instructions] And our first question comes from Janet Brashear from Sanford C. Bernstein.

I want to ask a little more about Macau, if I could. You have high margins now, and you've been growing them over time. You're up to around a 3%, 2% level. What do you think you potential is given that there's some wage pressure, both from the government and competitors right now?

Janet, it's Mike. Our management team there has really done an extraordinary job at managing the cost structure against the revenues. I think we have had some wage pressure. We've announced some wage increases this year. But in general, we think we have a pretty good handle on all our expenses. We should get some more improvement in the EBITDA margin. I don't think it's going to be spectacular in terms of numbers, but we still have a way to go. I think there's some improvement we can still get. I'm very confident with the people there today that they can very effectively manage their costs and there are other areas of opportunity we're looking at all the time. The wage pressure now is pretty much under control for another year at least, and I think it's going to stay pretty well because we've handled it so far.

Mike, could you give us an update as well on Lot 3? You have a time constraint of April 2013. Do you think you'll be able to do something to monetize that lot within that time frame? Or do you think you'll get an extension on that? And then also with the apartments that it sounded like the government was okay with you selling. What has to happen for that process to begin?

We're still waiting for the final situation with the government on the apartments. I think I feel very confident we'll get something in this quarter. There's some points of negotiations still going on with that, but we're very positive. On Site 3, you're correct. We do have a time frame on Site 3. Frankly, I think we're waiting to see how we do with 5 and 6 in terms of getting it open and getting the employees and the facilities necessary to make it successful before we actually start Site 3. We're quite confident, though, now should we want an extension on 3, we'll be able to get it. If not, we do own it, and the potential of monetizing it might be very well there for us.

Janet, this is Sheldon. I wanted to point out that in the last day, we've received the document for some of the detail on the continued negotiation for the contract for modernization of the Four Seasons service departments. So this is not a dead issue. It's very much alive, and just yesterday we received a couple of pages of issues. And it looks like most of the subset of issues are completed, and they were just a little tweaking left to do on the contract. So we're hopeful we'll get that a lot sooner.

Four Seasons, could you comment a little more about that? Those results were just a little less stellar than your other results.

It was a hold problem in the process of the casino at the Four Seasons, basically. That's really what it is. And in fact, that situation has reversed itself in the last few weeks. Basically, was a hold problem on the high end of the process in the quarter.

Your next question comes from Mark Strawn with Morgan Stanley.

You mentioned you're still learning the seasonality in Singapore. Can you give us a sense of what those trends are like on the VIP side throughout the quarter and perhaps into January, if possible? And I have a quick follow-up on Vegas.

Mark, it's Rob. Obviously, we showed reference on the opening remarks the strength of October in Golden Week. And October was very, very strong. We certainly fell off in November. We saw some very soft weeks, picked up considerably; very strong Christmas and New Year's. But I think we're learning the market everyday there. We're just now experiencing our first Chinese New Year's. It's a seasonality issue. It's a brand-new building and it's also just a market that we're just getting a lot of rooms open, all of our restaurants still haven't opened. Sheldon referenced the new opening of the rest of the facility. So it's a new place, and I guess I would look at the Macau numbers and kind of chuckle. Who would have thought we had improved $25 billion, $30 billion. I think Singapore is going to be just wonderful. It's already proving to be very, very strong in the mass segments, incredibly strong. And I think the seasonality, we're six, seven months into this building. It is going to take some time. How big this Chinese New Year is, just talking to them last night. It's extraordinary there, the volumes. And we'll keep learning, and we'll keep growing. But I think having 250 million, 300 million people couple of hours away by the airplane, it's hard to believe this market can't continually grow, and there's always a blip in November. But wait and see how the first quarter pans out.

We're not sure of the seasonality of that. What I'd like to point out to you and to the rest of the listeners as Mike said that the hold on the Rolling Chip volume, which is the majority of the activity at the Four Seasons Plaza Casino was only 1.55% and the adjusted property EBITDA for the quarter was 12.2%; whereby in 2009, it was 20.4%. I could tell you that it is a volatile result there. But I could say that we have exceeded that full quarter '09 $20 million just in January alone in 2011. We've exceeded that $20 million at the Four Seasons. But the reason why it's volatile is because we have a limited number of junket reps there, and we're bringing in new junket reps. And we hope to make it less volatile and, of course, more predictable.

Rest of January, we'll talk about January in Singapore seasonality.

Do I want to comment on seasonality?

No, January in particular in the U.S.

Well, let's put it this way. Our EBITDA is over $100 million in January, over. And what I'd like to say, Ken, can we say what it is? Over could be $100,000,001 or it could be $200 million. That's a lot closer to the $100 million. We're over $110 million for the month of January in Singapore. And when you talk about the annualized number, last January, I repeated this before at our shareholders' meeting. I said that I took the conservative approach and said that we would earn $1 billion in EBITDA. So if we capitalize -- if we annualized what we did in January, we'll already be about $1 1/3 billion in EBITDA for Singapore. I won't let one month's drop in Rolling Volume determine what the future is for Singapore. We're in a very, very hot market that has not been addressed before. The two properties will, as I said during my prepared remarks, will we hope, not exceed, but it will follow the pattern of dramatic growth as we followed the pattern in Macau. I remember a lot of people said that in Macau, we could never do it, we didn't know the Chinese market and we were the foreigner, et cetera, et cetera, et cetera. We paid back our entire cost of the property in either 12 or 13 months. Now that's not going to happen here, but we are going to have a multibillion dollar results to which Singapore will be a substantial contributor for the company. If you look at where we were, we were like $500 million EBITDA in '08. What was the number, Ken? We were about $1 billion in '09. We're $2.2 billion in '10 and our run rate right now starting with January in same-store sales in Macau and in Singapore is up significantly. And I think that run rate we experience might bring us to another $1 billion number. So we are experiencing a very what we called predictable and reliable growth trajectory. So we have gone up steadily over the last several years, and we see no reason why we won't continue to go up steadily.

Just really quickly on Vegas, it looks like you guys have done some work on the promotional side. I'm guessing that perhaps some of that's on the comp room side. Could you give us any color there, and that's my last question?

We have sort of changed our mix considerably over the last couple of months in Vegas. We have improved our room penetration, our group numbers for 2011 are basically on the books today compared to last year, like over double what they were at the same time. We experienced over 90,000 room nights in the month of January, which were significantly ahead of last year and we're still booking. We've actually increased that group room allotments. We've lowered our comp allotments considerably to get a better customer in, which may cause some short-term occupancy looks that looks down, but to the cash component to us is actually better. And we continue to move those numbers forward. I think Vegas right now, the group market, everybody would probably agree, has come back very strongly. The rates are somewhat under pressure, but we've seen a little bit of an increase in the January group number rate, and it's starting to go up to a reasonable number. There is much more competition now on the FIT business due to more five-star rooms in the markets and cross-pollen open [ph] . That will be competitive and difficult. And I guess lastly, our expectations for our InterContinental alliance are very high. We're working hard on it, particularly on the technology side the launch in April, and we think that'll fill a lot of the voids in the competitive environment and with probably the transient part of the marketplace.

We know that the subject of comps has been played out all across Las Vegas, but we've taken a different position. We've essentially cut out all our accounts except the most highly rated players. No more OE packaging deals to try to be competitive with others. There's no more comp rooms given out. There is no more RFP. There's no more food and beverage. There's no shopping credits. There's no restaurant credits. There's no showroom credits. We're selling rooms, and we see that it's resulting in a substantial increase in cash income.

Your next question comes from Shaun Kelley with Bank of America.

Just wanted to start maybe with getting your quick thoughts on kind of the latest on Sites 5 and 6; obviously, a huge initiative there and specifically kind of what's going on in the labor front? Any kind of insight on when you're going to be able to kind of ramp up the labor there and what the latest is probably for the opening date?

Shaun, our expectation is to get by the end of February an additional 3,000 workers from the Galaxy construction force finishing that property. With that, that will give us the ability to multiply that by 1,000 up to 6,000 more. We stand at about 3,500 workers on the site today. At this particular juncture, we're still planning to open a portion of Phase 1 at the end of this year. That portion of Phase 1 will be approximately close to 1,000 rooms, one of the two casinos, appropriate food and beverage, and the Paiza club and VIP rooms. That would be at the Shangri-La and Traders facilities. That's the worst-case scenario that we're looking at now. It could be better. If in fact, we get more employees coming in. We've got the approvals for them. We just have to match the one for one. And so we're just looking to get the Macanese coming off of Galaxy to do it. We get reports every week about it. That's the latest report, which as of the day before yesterday, which indicates no change in that particular plan, positively or negatively.

When do you think you might be kind of full property run rate? I mean, obviously, there's over 6,000 rooms that you're looking to get open there. So kind of it would open in phases, when do you think you're kind of at? What is a more indicative kind of full run rate?

It's difficult to say at this point. The completion of Phase 1, which would get us to about 4,000 rooms is actually on schedule for May of '12, probably in that area, May of '12. What happens after that really is going to be dependent on two things. Not only the construction work, but on the availability of workers that service the hotels. We still have some very significant concerns about the people who are going to make the beds and clean the rooms and clean the facility and whatever on the line. And we're waiting very patiently to see how Galaxy works it out with their facility. If it comes up, really they should be starting to open April, May or June of this year. So I can't predict when the last 2,000 rooms will get in there. Construction-wise, I think it's planned for the end of '12 or in the beginning of '13 at this point. But frankly, that's really going to depend upon the actual service labor available.

Just one on Singapore if I could. Obviously, some of the non-gaming amenities started to show some continuing ramp there. Kind of how should we think about where you guys are right now in the curve? And can those numbers continue to move higher from even these levels or are these more of kind of the right run rate in terms of what you're seeing?

We're running in the mid to high 80s now for occupancy. I mean, it's two days now quite before Chinese New Year that have dropped down a little bit, but now it's picking right up. Our occupancy numbers are getting close to the 90% target. Our MICE business in the first couple of months of this year is good. We still need to do some work there. But we think over time, it's going to come -- the potential -- we are really getting close to the occupancy potential now, and the rate structure is very good. We're very -- we've got a good rate going. Our Restaurant business is up considerably from where it's been, and I think we're probably 80% to 85% for the potential on the property for this moment in its lifestyle or in its -- so they're somewhat to go, but we really pretty well ramped up at this point. More you're going to see when some more clubs and more retail. Retailers a bit slower than we'd like. We've opened about 260 stores now, 250, 255, 260. We've got about 40 stores to go. That had a decent month in December, but it's still slower than we'd like. It's probably about 55%, 60% of the way there on the EBITDA line. And...

That's because the subway is not yet opened.

When that's opened, I think it'll be fine. So in the first quarter, our annualized sales were about $982 a square foot or was in the first quarter and the fourth quarter. So we're getting there. But that's the biggest. The biggest piece to ramp from here is long-term MICE bookings in '12 and '13 and '14, and the shopping model. The hotel, I think, is well within our expectations now.

Just one last one on the mall if I could. Any sense on either what kind of the kind of current run rate, NOI margins are there or kind of what kind of EBITDA that generated in 4Q? I know you don't usually split it out, but that would be really helpful.

It's about in the mid-80s EBITDA coming in on the mall revenue today. That's what I've seen in the last month. But it's really I can't give you a number that's going to be consistent. Over time, that should build up even higher than that. But I don't know if that's real -- December is, of course, a little different than November and different from October. But we're still in the early stages, but the long-term future of the mall in our business plan is to eventually dispose of the mall. And if you put a cap rate on that of 4% or 5% and you can see that we can do $170 million to $200 million of EBITDA out of there by 2013 or so, that's a lot of money in the bank for us when we grow it. So that's what we're watching.

Your next question comes from Joe Greff with JPMorgan. Joseph Greff - JP Morgan Chase & Co: I have one Macau-related question, one Singapore-related question. Can you just discuss some of your efforts in Macau increasing your junket VIP-related volumes? And then in the fourth quarter, was there a big difference in the mix between direct and junket? VIP volumes have been an issue in Macau. I think that was referenced in the earnings release. And then for my Singapore question, can you just talk to me about the plan to replace Tom. I guess in the near term and the longer-term perspective?

Joe, let's start with opportunities in Macau vis-a-vis junkets. We think that our business in Macau since David Sisk and Ed Tracy joined, it's clear these guys made a big difference, and we're seeing a nice move in the right direction. The two places we're concentrating on in '11 and beyond is the opportunity junket side, and there's a lot of issues there. It's relationships and service. Ed's trying hard to make sure that these guys see themselves as critical to our business plan. I think you'll see -- it's hard on this call to explain all the issues there, but we have a lot of challenges, which we're meeting every day. Just came back and David understood it very well. And it'll be a focal point for our growth in Macau. We think it's a huge upside for us on the junket side and not the premium side. Same goes with premium slots. I think the success in premium slots, again, Ed and Dave have work cut out for them; its relationships, its customer focus, the marketing side. But we think there's a lot of potential. Our slot numbers are great on the mass side. We've captured the market in the mass side in the best way. There's challenges, though, clearly on the VIP side of the slots. We hope that our efforts will pay off in '11 and '12 and beyond. We think there's great potential to grow our business in Macau, both top line and EBITDA. And although we've done great stuff on the mass side, there's opportunity in both those areas. Your second question relate to junkets. You were speaking to the Macau junket question versus premium? Joseph Greff - JP Morgan Chase & Co: Yes, just generally when you discuss your Venetian Macao fourth quarter results, you talk about the Rolling Chip volumes, the mix between direct and junket.

If you compare it, I don't know if Venetian Macao is all the operating properties, if you will, in Macau. Percentage goes from about 16% to about 24%.

And Joe, that's juiced up by Four Seasons, which is the highest one. For Venetian it's actually 18.6% or about $2.2 billion of the roll. Joseph Greff - JP Morgan Chase & Co: And then any kind of commentary on the spot of Marina Bay Sands or Tom Arasi?

Sure. Right now, George Tanasijevich is interim CEO for the building. George has been there with us since the very beginning. He's extremely well connected with everything in Singapore from the government to all the regulatory situations and the construction and the people, the architect and all the people that built the building. We beefed up the operations there over the last couple of months underneath Tom and also the marketing and sales operation, which is basically doing a lot better now than it was previously. We're not nearly essentially in a rush. We're out to search now for the selection process for the CEO of Singapore. But George has been told he is a candidate. He's our global development guide. We, frankly, not like to lose him to that job because he's important to us in global development. But we're out to search. The search has been distributed, and we'll be developing candidates. But once again, I would say we're very confident that George could sit there and handle what has to be handled on a daily basis so that we're not in a rush. So we'll be very careful with the selection. I should mention also that most of you probably noticed, I don't want to be redundant, but these particular roles who run these businesses, the industry, the hospitality of Gaming has never really trained people to run buildings of this size and complexity. It's all about integrated resource. And it's very hard to find people who can adjust to the seven or eight or nine businesses that exist under the roof of these places. So it could be somebody from any of these industries, but we're looking for a broad-based business person who can literally manage and lead a multiple of businesses at one time. And they don't come to you every day. So it's not an easy search to do. We are very confident George has a lot of the skills that might be necessary, but want to make sure we take a look at these kinds of....

Our next question comes from Felicia Hendrix with Barclays Capital.

You gave us some nice color on 2011 group business in Las Vegas and how that's shaping up. I'm just wondering is there anything on the books for 2012 what that might look like? And I'm assuming that pricing for what you could see in 2012 is higher and better.

Right now, we're talking about for 2012, we're forecasting what we have today is tentative and actual about 781,000 room nights, which is more than what we have today for the last -- and a forecast is closer to $200 for next year versus this year's forecast maybe $180.

And then just moving to Singapore, whoever wants to take this, your slot win per unit per day is obviously outstanding, and you're adding more machines there to address that. Just wondering what the capacity is, is there because I'm assuming that's going to be absorbed pretty quickly.

The story in Singapore, there was a time when $1 billion -- the part of all the casino income was considered a big reach. I think you now look confident in Singapore and say, "We're going to reach $1 billion out of slots and mass tables." I know the focus base is somewhat on the miss, sequential quarter miss on the rolling. But what's extraordinary to me, I just came back from Singapore, we added 300 units. Last night we basically maxed it out. We ran in the high 90s in terms of occupancy on those games. So I think slots just keep growing. The story to me in Singapore is the amazing growth in slots quarter-to-quarter, coupled with the growth in the Non-Rolling tables affords the opportunity to probably get to $1.5 billion. In the near future someday, whether it's '11 or late '11, you're going to see $1.5 billion of cumulative revenue at a 65, 66, 67 point margin. Which means there'll be a day in some time, we're talking about $1 billion EBITDA without a rolling chip crossing the table, which to me is pretty extraordinary for a place that people a year ago questioned whether we could make $1 billion. The slot business there is exemplary in every way. We keep full of the mix. I mean, Andrew MacDonald and the team there are going to keep moving the games around. They're trying to maximize what obviously is an opportunity far beyond what we experienced in Macau years ago. We'll add 300 games by the end of Q1, and we think the absorption is simple. I mean, it's not going to be difficult. We think with our marketing, our mix and a just better thought process as it relates to slot machines, we're hoping to see that market exceed the $1 billion between us and RWS. And I think those guys have done a terrific job as well. So clearly, the slot business there is extraordinary. I just worry about honestly over capacity, under capacity and weekends, holidays where we're going to run 90%, 100%. And for those of you who've worked in markets like Las Vegas, it's unheard of. But it's a fact of life. $1 million slot base now are pretty much routine. We're now looking for $2 million opened in Chinese New Year's to see $2 million slot base. So we couldn't be more -- as much as we're looking to improve get our Rolling Chip business where we want it to be and we're going to get there. We couldn't be happier with the growth, sequential growth and January growth in slots and mass tables. I think -- 65, 66, 67. To me, the story in Singapore is $1 billion out of Rolling Chip customers. So we couldn't be more pleased about where we're seeing the slot business and mass tables with a whole percentage space in the mid-20s, 22, 23, 24. And the volumes there are -- the quarter-on-quarter gross 5-plus percent, and we see a continued trend in January. So we're very, very pleased with those businesses.

What I'd like to say is that we haven't said before that we have not given up, and we've accelerated our quest for additional new executive talent. And in that respect, we just have two new guys that are joining us that'll be based in Singapore, so I'll let Rob tell about one in the casino, and I'll let Mike tell you about the other guy in sales.

So Mark Juliano, I know the rumor's out that Mark's joining. It's been years. He's moving over in a couple of weeks' full time. Actually, he's actually moving over this weekend full time. And Mark will be involved in the casino side. We're still sorting out all the relationships, but we feel he's a good addition to our team over there. And again, we keep looking to get stronger and smarter and more intelligent of the market. And I think Mark adds real value so he'll be a full-time MBS employee by this weekend next week. Mike?

Yes, we've also hired Senior VP Sales and Marketing for Asia based in Singapore, a man by the name of John Dems [ph], who's a former Starwood executive. He's been in Asia before. He's been here for the last couple of weeks. He'll be back in Singapore next week and then shortly thereafter, permanently. We beefed up our sales and marketing team all over the country now and in jobs that we haven't had before, which will help our MICE business, both for Singapore as well as for Macau. And we'll be announcing this week two additional employees for our project development area, design and construction, one from Disney and one from Gaylord who will be coming in. They both have signed up, and there'll be an announcement on them in terms of new development projects that we're working on. So I think most of you have seen that we've also added a new senior position in human resources, and we're pretty well staffed up for the battle ahead in every way that we weren't a while ago able to do.

Your next question comes from David Katz with Jefferies. David Katz - Jefferies & Company, Inc.: This may seem somewhat of an odd question, but as I sort of look at the financial profile, particularly past this year, the leverage continues to come down dramatically, and the cash flow continues to ramp up. Have you given any thought at any point to returning capital to shareholders through dividends or other vehicles? What thoughts do you have in that area?

Well, I have fantasies about it. Since the Adelson family still owns 52%, if the board were to declare a dividend, we get 52% of it. That would allow me to feel free to travel by a bigger plane with more than two engines because of the cost of fuel. Now all that baloney aside, we've not talked about it. As a matter fact, yesterday, Ken came up to me with a proposal that we pay down our $2 billion something within the next 18 to 24 months of outstanding debt in Macau. We have no rush to pay whatever scheduled amortization payments there are for Singapore. We could very easily meet. He wants to make us debt free in Macau except for 5 and 6, which hasn't opened yet. So we'll be debt free in the other three properties if we pursue that road, and then we will upstream dividends to pay off the U.S. Restricted Group. So in terms of deleveraging, I've been saying that for years, and I know back in '08 when things were kind of dark looking, everybody said, "He's talking about paying up his debt and becoming debt-free, we're talking about keeping the company going." And of course, that was never an issue to me vis-à-vis having put in $1 billion, and people are telling today it was the best bet I ever made. But I say the best gamble I ever made was my second marriage, and I hit a grand slam jackpot on that one. So that was a good bet, and so was the $1 billion. So it looks like we are delevering. Not looks like. I mean, we've got all this cash. We've got $2 billion, $3 billion in cash. We have like $3 billion in credit lines, unused, untapped, and we're earning billions of dollars this year. I don't want to say because it'll be considered guidance, but when I said that we would earn $1 billion in Singapore and $3 billion for the year, I have no reason to think that we're not going to achieve that, if not more. So we're generating an awful lot of cash flow. And to have cash or not to have cash, having cash is better and no debt.

Your next question comes from Bill Lerner with Union Gaming Group.

Maybe this is for Rob. Can you talk a minute, Rob, just about the overlap or maybe lack of overlap in players across your system? In particular, I know in the past, there was some concern about cannibalization between, of course, Singapore and Macau. We've chatted about that, but I think you could give more color now, I think, from you on how much overlap there is and what's the difference in those types of players.

Well, it's a very different market, Bill. We talked about that. I think, obviously, the growth engine for Macau has been mainly in China, and we'll continue that for the future. Not to say there isn't demand out of mainland Hong Kong for Singapore because there is some demand. There is some overlap. I don't think it's -- it hasn't, obviously, impacted the numbers in Macau as they move to USD $30 billion. But Singapore is still mainly reliant upon the region being there's 250 million, 300 million people within a two-hour plane ride or bus ride or car ride or walk between Singapore and Malaysia, Indonesia, Thailand, et cetera, Vietnam. I think that the push in the business there will continue to be that region. We have been, honestly, pleasantly surprised by the very upper tier mainland customer who wants an escape, getaway from Macau and comes down for three or four days. And that tends not to be the core Macau customer. It tends to be more of a upper echelon mainlander who wants to go for a real vacation, spend three, four, five days in Singapore. And let's not forget we've talked about many times the importance of the private wealth issue in Singapore. There's so much money, so much capital is resident there for private wealth. And I think that bodes very well as does the access into Singapore is still extraordinary. But we're not seeing -- we've had very little difficulty managing the demand. And customers tell us, we don't tell customers where they want to go. But for Chinese New Year's, I will tell you that demand in Singapore has been a pleasant problem. We have too much demand, and it's amazing business. Sitting here in Nevada, in Las Vegas, we will be dancing all weekend with the rabbits. And Macau continues to do amazing business. I mean, Macau is extraordinary place. So at this point, it has not been an issue. We didn't anticipate, but it still has been not an issue for us.

One follow-up since you mentioned Chinese New Year. I know it's so much less fun to talk about Vegas than what you're doing in Asia these days. But as it relates to Chinese New Year in Vegas, what did advance reservations suggest, what are you experiencing now as your...

Extraordinary. I think demand in Las Vegas is great and the city needs these big holidays, and we got it. I think work's just paying as much as anybody else. It pays per hour. LVS is privileged to be the only company in world with two different gaming licenses in Asia. We're feeling the punch of that. We're completely sold out in every level. A lot of capacity issue in the table games this weekend, and we expect to have an extraordinary year of the rabbit. But people who are concerned about Nevada being hurt by Asia, by Singapore, Macau should relax because just the opposite is happening. We get all that residual business that comes here in Nevada because of the relationships with those customers. They know us. They know who we are. Same, I think the Wynn folks, just paid very well, and so does MGM. I think we have very, very strong holiday in Las Vegas, very strong.

Your next question comes from Larry Klatzkin from Craft. Lawrence Klatzkin - Jeffries & Co.: The question I have is Las Vegas Sands is a name, I guess, from the past. Is there a chance, Sheldon, you're considering a change to something more contemporary to what the business is with the company?

I'd tell you I brought it up before our board, Larry, and there were people who say that since our expansion, the bulk of our expansion will be in [indiscernible], it's good to identify with Las Vegas and say that we come out of Las Vegas. So Las Vegas is bringing its imprimatur and its style to other countries. But it doesn't seem to prevent us from talking to several governments. I want to tell you that, not necessarily in Asia but in Europe, we're talking about grants and incentives, which means they're going to follow the economic development model that has been successful in many countries heretofore. And we're going to look at getting subsidized and tax holidays and lower gaming taxes and all the good stuff from other countries when we bring our developments there. So that's the reason why we've got several people that are new in our development team that are joining us this month. And that can help us justify land selection and we're taking a different approach on not constructing ourselves, but bidding out the construction cost. We've got a very, very exciting future. As I said earlier, we're looking at following the very steady, predictable and reliable growth pattern. Regardless of any bumps in the road anywhere along the road, we look very, very good. We've looked very good in the past, and I see no reason that the fundamentals will change for us to look equally as good, if not better, in the future.

Your next question comes from Robin Farley with UBS.

I wonder if you could put some of your comments about Singapore in context. Just looking at how your hold on rolling volume was above the normal rate, would you calculate that's about $295 million or so for EBITDA if you normalize that hold?

No, I want to give you something, and I think we neglected to put in our prepared remarks. Our 200 day moving average, which really counts is 2.83%. Am I correct on that, Ken?

Yes.

The ups and downs, the peaks and valleys of weekly or monthly performance is not really what it's all about. What it's really all about is what your long-term moving average is and the percentage. I'm looking at it now, oops, I made a mistake. It's not 2.83%, it's 2.93%. But like today, the average all the way through from the time we started, the 2.93% is the 200-day moving average and like today it's 2.83%. Sorry, I got that a little confused. So you could make adjustments up or down for the quarter. But for a valued investor and of course, we have a lot of those, for a valued investor and long-term holder like us, we're interested in where we're going long term. If we had an extraordinary number like 3.5% or 4.0% on the high-end hold, of course, it would be cause to make the adjustments. But when you're looking at a 200-day moving average square within the bracket that we need between 2.85% and 3.0%, that's the bracket that we need. I mean, you can't pick it out of the 1/100th of 1%...

I totally agree with your comments about the value looking at the long term, and that's why about 3%. If you're using your 2.93%, I was going to give you credit for 3%, but if you would use 2.93% as the average in the quarter, I know that would put you in $280 million range in EBITDA. I'm just trying to think about what you think the normalized level is. But if you want to use 2.93%, that's actually, that's great.

That's the 200-day moving average.

And I wonder if you can also put some of your comments about January during the Q&A either sort of give an indication either of maybe what rolling volumes were or whether January was above average as well, just to put that EBITDA in context for us?

Frankly, I don't know. I just got the number. We get numbers on a daily basis, and that was the number for the 31st. I didn't look at the details because I didn't anticipate blurting them out.

Your next question comes from Cameron McKnight with Buckingham.

Sheldon, if you could elaborate or comment on the initial positioning of Sites 5 and 6 relative to your other properties in Macau when you guys opened in the first phase at the end of this year?

What do you mean by initial position?

In terms of strategy, what market you'll be looking to go after?

On the casino side or on the non-gaming side?

On both.

On the non-gaming side, this is the first time that we're bringing it beside the Four Seasons, but it's only 360 rooms. This is the first time we're going to have Shangri-La, Traders, Sheraton. First time we're going to be able to dig very deeply into an international brands and their database and their customer base to come to our properties. Now we all have experienced the InterContinental depth with over 100 million frequent user, customers, whatever they call it. We want program customers in Las Vegas here as the Venetian Palazzo. So it's going to be very interesting. We don't know for sure, but we're very hopeful because in putting together the program that we need for the InterContinental here in Vegas, the potential for that is extraordinary. We understand that in another location that InterCon has done this, they're providing 44% of the FIT for that hotel. I don't want to mention the name. We're not -- total room revenue of 44%. Well, that's tremendous. So my original vision to bring in all these very deep databases and customer lists of the international brands, I believe is going to work out. We are already lining up, we have about 40 private gaming rooms that we are lining up junket reps to go in there. And if we didn't say it today I'll just repeat it. We're relying less on premium direct customers and relying more upon the junket reps, as I've told them, because we thought that what Steve Jacobs had done was the wrong move. It was one of the reasons why he was terminated. We asked him not to do and he did that. In any event, where our relationship with the junket reps is improving, we just brought on a top guy from one of our top competitors whose relationships with the junket reps is what we brought him on for. He's a specialist in that, and we expect that to improve. So as far as the two mass-market casinos are concerned, we're opening one at a time. One will be opened in six months, later the other one. But the rolling programs in the 40 private gaming rooms will be most, if not all of them, will be open from the outset. But it's -- Rob, can you add anymore to that?

I think you said it well. I do.

Well, I said nothing, but I said it well.

I think we've got a talent in the junket side. We've got a lot of work cut out for us there, and a lot of opportunity there to growth it. And I think we've done an extraordinary job in the mass side of the business, both mass volume table as well as slot. Our upside is in the junket and the premium slot side, and that will be the focal point as we go forward.

By the way, these stadium-style seating capacities on sic bo and baccarat and roulette have not been, in the past, in much demand in Macau. But we put them in, and now they're doing quite well. They're doing very well. So it goes to show you what I've been saying for years that supply creates demand. When we first started, I might add, when we first started there was big argument within the management of this company as to whether or not we should rely upon putting in slots. There were those of us, of which I was one, that was a major advocate of slot growth because at that time, they had English language and English characters in the slots. So if somebody wants to know how they're going to win, they had to learn how to read English. So when we had the slot manufacturers make up faceplates of Chinese characters on the reels and Chinese language characters so they could read how they're going to win, then it made quite a difference. And now the slot business in Macau is a very, very big business.

And growing.

And growing.

Ladies and gentlemen, we have reached the allotted time for Q&A. Sir, is there any closing remarks?

Any closing remarks. Okay. Let me say thank you, and let me close by saying that we have proven over the last several years that while we do see peaks and valleys in our business on a monthly or short-term basis, we've enjoyed a very predictable growth trajectory. There is no reason to believe any fundamentals of our business are changing. So we have every expectation that this growth trajectory will continue. We're proud of another record quarter and the completion of the most successful year in our company's history. But make no mistake about it, we will not rest on our laurels. We have the best assets. We have the best assets in each of the markets in which we operate, and we will work tirelessly to make sure each of them is maximizing its potential. At the same time, we will continue to aggressively pursue new opportunities, which will fill our development pipeline and help us maintain our position as the pacesetter for growth in our industry. Thank you, all, for joining us, and we look forward to talking with you again soon.

This concludes today's conference. You may now disconnect.