Las Vegas Sands Corp. (LVS) Q1 2025 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the Sands First Quarter 2025 Earnings Call. [Operator Instructions] 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.

Thank you, Paul. Joining the call today are Rob Goldstein, our Chairman and CEO; Patrick Dumont, our President and Chief Operating Officer; Dr. Wilfred Wong, Executive Vice Chairman of Sands China; and Grant Chum, CEO and President of Sands China and EVP of Asia Operations. Today's conference call will contain forward-looking statements. We will be making those statements under the safe harbor provision of federal securities laws. The language on forward-looking statements included in our press release and 8-K filings also applies to our comments made on the call today. 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 financial measures are included in our press release. We have posted an earnings presentation on our website. We will refer to that presentation during the call. [Operator Instructions] This presentation is being recorded. I'll now turn the call over to Rob.

Okay. Thank you, Dan. Let's begin with Macao. This is a competitive market that has not grown as we anticipated. However, we have the strongest assets in the market, and we can perform better despite the challenging macro environment. The Londoner is now fully open this time, 2,405 study rooms and suites as we prepare for Golden Week in May. Now we've complete the development projects, we expect this asset to elevate our performance. Our focus is on improving our revenue and cash flow across the portfolio. There is opportunity in every segment that shows strong results. Our business strategy remains unchanged. We have designed our capital investment program to ensure we will lead in both Macao and Singapore. We delivered $535 million of EBITDA for the quarter in Macao. SCL still continues to lead the market in gaming and nongame revenue and EBITDA. We have meaningful opportunities to grow in every segment. Our objective is to grow our share of EBITDA in that market. We have a unique product advantage in terms of scale, quality and diversity of product offers. Turning to Marina Bay Sands in Singapore, we delivered a record quarter with $605 million of adjusted property EBITDA, an extraordinary achievement by any standard. I assume this is record EBITDA a quarter for any gaming property in the world, a pretty extraordinary performance. Mass gaming and slot win reached $778 million, reflecting 73% growth from the first quarter of 2019 and 13% growth from 1 quarter a year ago. The results of MBS reflect the positive impact of our gaming investment program and the growth of high-value tourism. The growing appeal of Singapore as a destination is enhanced by the robust entertainment and lifestyle calendar. We believe there is considerable runway for growth there as well. Again, thanks for joining the call. I'll turn the call over to Patrick before we go to Q&A. Patrick?

Thanks, Rob. Macao EBITDA was $535 million. If we had held as expected in our rolling program, our EBITDA would have been higher by $10 million. When adjusted for lower-than-expected hold in the rolling segment, our EBITDA margin for the Macao portfolio of properties would have been 31.6%, down 280 basis points compared to the first quarter of 2024. All 2,405 rooms and suites at the Londoner Grand are now available for the upcoming May Golden Week. Now that the refurbishment process is completed, we are focused on delivering revenue and cash flow growth at the Londoner. Margin at The Venetian was 35.3%, while margin at The Plaza and Four Seasons was 35.6%. We expect margin improvement as revenue grows, and we use our scale and product advantages to better address every market segment. As the Londoner ramps up and is integrated into our Cotai offerings, our competitive position will be stronger than ever. We look forward to utilizing our entire portfolio to grow revenue and EBITDA. Now turning to Singapore. MBS's EBITDA was $605 million at a margin of 52%. Given the mix of games and demonstrated player preferences over the last 2 years, we have updated our expectation for hold on rolling play at Marina Bay Sands to 3.7%. There will naturally be fluctuations in any specific quarter given by game mix and player preference. We will continue to provide the illustrative impact of hold on our rolling play in Singapore. The record financial results of Marina Bay Sands reflect the impact of high-quality investment and market-leading products and growth in high-value tourism. We believe we are still in the early stages of realizing the benefits of our investments in Marina Bay Sands. Turning to our program to return capital to shareholders. We repurchased $450 million of LVS stock during the quarter. We also paid our recurring quarterly dividend of $0.25 per share. Before going on to Q&A, I'd like to provide an update on a New York development opportunity. We strongly believe in the development opportunity for land-based downstate casino license in New York. We also continue to believe that the Nassau Coliseum site is the best location for that development opportunity and should be highly competitive in the New York casino licensing process. However, as we have previously stated, the company remains concerned about the impact of potential legalization of iGaming on the overall market opportunity and project returns. We are in the process of attempting to secure an agreement with a third party to whom we can transact the opportunity to bid for a casino license on the Nassau Coliseum site. This would include those that may be able to address both land-based and digital markets in New York. For Las Vegas Sands, we believe the highest and best use of our capital in the near term is to purchase LVS and SCL shares. Accordingly, LVS has decided not to bid for a casino license in New York. We believe repurchases of LVS equity through our share repurchase program will be meaningfully accretive to the company and its shareholders over the long term. Our Board has increased our share repurchase authorization to $2 billion. We look forward to continuing to utilize the company's share repurchase program to increase returns to shareholders in the future. Thanks again for joining the call today. Now let's take questions.

[Operator Instructions] The first question today is coming from Carlo Santarelli from Deutsche Bank.

Rob, Patrick, thanks for your comments. As anyone could kind of see, when you look at the valuation of the Hong Kong listing and what it implies basically for the corporate and Singapore, one understands kind of the willingness and the desire to kind of repurchase shares. As you do think about the 2 entities though and the various repurchases across both and your stake in the Hong Kong listing specifically, how are you guys kind of balancing the way you more or less go about those allocations right now?

So I appreciate the question. You've heard us say in our prior calls, we see meaningful value in both LVS and SCL equity, and we're going to continue to act with this belief. So we were active during the quarter at LVS. I think our goal is to really be active in both SCL and LVS equity and continue to march towards that 74.9, and you'll see us do that. I think on the LVS side, we think the valuation, where our stock is currently, is very attractive for us. We're going to be aggressive in the way that we buy back shares than we have done previously. So we view it as an opportunity, and we're going to continue to be active in the share repurchase market for both SCL and LVS.

And then if I could, just a quick follow-up. Obviously, the decision to raise the theoretical on the VIP side in Marina Bay Sands make sense relative to the history here over the last two years. As you look at, however, on the mass side, hold was up nicely. And I know it's always tough to kind of guesstimate what handle would have been in a normalized hold environment and how to think about all of that. But when you look at kind of the impact the higher hold year-over-year on the mass side, mass table side, specifically had on MBS, is there any way you guys could maybe outline how you think about the potential EBITDA benefits that stem from that?

I think the problem is it doesn't matter high-end or mass, the problem is it depends on what the customers bet. And that's always been the reason why there's talk about smart tables, it enables you to actually know and not guess whether it's 3.4% or 3.6%, 4.1%. It tells you specifically. I think that's the advantage we're going to have in both Macao and Singapore in the future. And again, it's basically a composition of bets, it really doesn't matter if it's premium mass or base mass. The customer bets, I call them prop bets, that the lesser -- the more favorable bets to house has been driving the hold percentage. It's a very -- for years, people discuss this and guess the handle and hold percentage and false drop, et cetera. This takes the guesswork out of it. It makes it actually mathematically perfect. And that's our goal, is to have that information across both prop -- both jurisdictions in the future.

I think the most important thing here is that while MBS obviously is impacted by hold on our rolling program, really the outperformer at Marina Bay Sands has been the mass segment. I think that really has been the story of Marina Bay Sands. Yes, I think our rolling business has improved in a meaningful way. But when you look at Marina Bay Sands and the investments that have been made there, it's really to attract high-value tourists on the mass side. And our premium mass and mass segment there has outperformed to an extraordinary level. And we think there's room to grow now that our renovation is completed. So I think it's an important story to talk about how we see the uptake of these side bets and how it has moved our hold over time. I think our team there has done great work developing game types and innovating so that we can benefit from player preferences and these more aggressive bets. But at the same time, it's really a mass driven story based on the investment and the non-gaming amenities that are driving visitation and high-value tourism. That's why you see the EBITDA that we have today.

So Rob, Patrick, then, is it fair, if you look at last year, kind of the mass table hold was right around 20.1%, it had been kind of 18% and 19% in the prior years. Based on the theoretical that you guys are seeing with the information that you have to be able to do so, is 20% more like that normalized level on a go-forward basis on the mass side?

I don't know. You can though. Again, the difference is it's like sports where, if you read about the sports betting companies, when they have flat bets on -- if one team as the other, the hold percentage is relatively weak. When they make side bets, it soars. And I think the same is happening here. The mass tends to bet more on the prop bets, gives you more advantage. And that's my point, is that, after 20, 30 years I've been doing this, people have been guessing what's the right hold? Is it 3.6%? Is it 2.4%? The beauty of this whole thing is we'll know mathematically perfect based on the bets they're making, we take the table drop out of it and the false drop and the handle, it comes down to it, basically it becomes a slot machine, you'll know exactly what the number should be. And I think we are seeing now across the industry is the development of side bets has been very valuable. And since we're the biggest baccarat provider in the world, for this company, it's very valuable and it will impact EBITDA in the future. Because the more bets they make in these side bets, the more you grow the hold percentage. Baccarat used to be a very dead game for the house at 2.6%, 2.7% because those flat bets were predominant. To date, the fact it's grown to 3.7, it could go to 4, is hugely valuable of course to EBITDA. And again, it will be very clear within the next year the exact mathematical number. You won't be guessing anymore and say it's going to be this. It's going to range, I guess, 3.5% to 4%. But again, as these bets proliferate and people choose to make these side bets, I think baccarat becomes more and more valuable to this company because it's our principal source of revenue.

And we should just caution everyone that with player preference and game mix, these percentages will move around with bet size. So we just have to be aware that this is the best that we can do in terms of providing information and we're going to continue to be optimistic about the types of games we put on the floor in terms of growth they can provide, and we'll see what they do.

But one thing that's undeniable is bet differences are happening every day and the result of these games is very valuable for the industry, it's very valuable for us, and it's happening and getting better by the day. And the more of these bets continue to become more important, the more EBITDA will grow. I think it happened both in -- you're seeing it in Singapore, I think it will happen in Macao as well.

The next question is coming from Stephen Grambling from Morgan Stanley.

I think you mentioned that there's an effort to activate the properties and see revenue and EBITDA ramp from here as the Londoner project has generally come to completion. It looks like there's some moving parts across the different properties. I'm curious if there's any thought process on some of the ones that maybe have lagged in terms of how you will reinvigorate growth there, whether it's Venetian or others? Or is it just really a question of as the Londoner is kind of fully up and running, you'll see everything click?

Yes. Thank you, Stephen. I'll take that question. I think overall, yes, the focus will be ramping up the new product at Londoner brand. As Rob mentioned, we now have the 2,400 rooms and suites in full service. And you'll see us leveraging the asset, the new product to drive customer growth and, obviously, eventually revenues and EBITDA. But the ramp-up will take its course over the next 12 months. We're still at the early stages of it. We just got the full complement of the rooms in mid-April. As for the other properties, our intention is to maintain and grow each of the existing properties whilst Londoner is ramped up. So you'll see us focus across Venetian, Parisian, Four Seasons and Sands across all of the product segments and price points. But yes, the driver of our customer growth will be the Londoner over the next 6 to 12 months.

And does the initial read in what you're seeing there change the way you think about CapEx and allocating capital across the different properties? Or is there any kind of renovations that you see in the future at some of the other properties?

I have to tell you, I think Macao is the greatest gaming market in the world. If you look at its size and you look at the potential and where its source markets are, the long-term potential there is absolutely incredible. And so we love our ability to invest there. We love the scale nature of our portfolio, the number of amenities that we have and the quality of those amenities, and now the high quality of our entire property portfolio. We think we're in a great position. And we're going to continue to invest to maintain that position. But also for growth, because we think the opportunity is there long term.

I think we will continue, Stephen, with regular upgrade and renovation of our existing assets. That's a given, given we have 33 million square feet of asset portfolio across Macao. But the major redevelopment and upgrading at the Londoner is largely complete. We'll have a few more amenities to add, and restaurants. But from here on, you should expect, yes, we will continue to reinvest back into the asset base because we need to upgrade and keep up with the competition. But it will be regular renovation where we'll be taking modest amount of keys out at any one time. And you'll see that over every year, every quarter over the next several years as we upgrade the existing portfolio.

The next question is coming from Robin Farley from UBS.

I just wanted to circle back to the ramp-up you mentioned for the Londoner. You did mention that it may take 12 months. So I wonder if you could just talk a little bit about do you think that your market share results in Q1, did the new Londoner rooms contribute to that? Or would you say not really, like that that's not really indicative of where you think your market share can go? And I guess I don't know if you can give a little more color around what would happen over the next 12 months, or why it would take 12 months. I know you'll have, of course, very easy comparisons to the disruption in Q2 and Q3 last year. But that maybe is a little bit longer of a ramp-up period than maybe people would have expected?

I have to tell you, this is what we spend a lot of time talking about. And we're very focused on growing our business in Macao. Unfortunately, we had 2,000 keys that we really -- 2,405 keys that we really wanted to be available. It took a little while to get them. So during the quarter, we didn't have full access to all the inventory we normally would have to bring to bear. So I think when you think about it, 1,700 keys that we were out, or 1,400 -- 1,600 keys were out in average over the quarter, is equivalent to not having a property available in your portfolio. And so I think now that it's back and we have the full strength of our portfolio, we're going to press very hard to continue to grow this business, recapture share, recapture EBITDA share and grow revenue, which will expand our margin. But we have some work to do. I think that's very clear to us. We know it, we acknowledge it. And there's some things we want to focus on in Macao to improve our outlook and grow our business.

Robin, I think the reference to the 12 months is simply that in any new property of this scale, we are going to get better and better over time. That's really the point of that comment. In terms of the market share, yes, I think our results were impacted by the fact that we lost market share both against the prior year and sequentially, and we are looking, with the new assets coming online, we are looking to be competing harder for the revenues in a flat market. And we fully intend to compete with the Londoner, but also you can see some of our results in the other properties. We're looking to improve performance at Venetian as well as the other existing properties. So I think it's going to be a comprehensive effort to reactivate, engage new customer growth as well as to fully leverage the new property in Londoner Grand.

And maybe just as a follow-up, Macao has talked about kind of wanting to review the non-gaming investments and efforts of the concessionaires. Do you have a sense of what they would like to see more of or what they have changed recently or they would be looking for more of going forward?

I'll give my view and maybe Wilfred can also chime in here in terms of the policy direction. For us, we are continuing to focus on what we've committed to the government in terms of non-gaming investments. And clearly, we've already made a significant investment in upgrading the Venetian arena at a cost of around USD 200 million. That was completed last year. That's our single biggest project that we've completed for the concession commitment. And of course, in terms of programming in terms of developing sports and mega events with strong international IP, we'll bring the NBA preseason games this October, which will be a multiyear partnership. Wilfred, do you want to add to how things are evolving in terms of the direction on non-gaming investments?

Sure. I think the new administration now has had time to look at the overall picture of the non-gaming development. And they are -- as long as we maintain our total commitment, they are looking to us to specialize in areas where we each do best because there's -- they feel that maybe it's better that, rather than 6 of us all working on similar areas, maybe there are emphasis that each of us can focus on. So there will be opportunities for us to discuss with the government what -- how we do best in some of the areas. And the second area is that we because of the GGR reaching a certain level, we are also committed to spending an additional 20% of our -- into the non-gaming investment. And the government is really looking into how best to coordinate the use of these proceeds.

The next question will be from Shaun Kelley from Bank of America.

One big picture one and then sort of one micro one, if I could. On the big picture side, just Rob or Grant, your high-level view here on just has the market dynamic in Macao changed at all as it relates to the balance between premium mass and the competition there versus base mass? I mean as I think about it, LVS has always succeeded, I think, really well when the market has been extremely full. But we've seen the visitation recover now and sort of both segments are struggling a little bit. And so I'm just kind of curious on the balance and sort of are you pivoting strategy at all to kind of lean into particularly the premium segment, if that's the healthier one right now?

Shaun, your observations are correct. It's a -- our scale and size played to our advantage for years and was a huge advantage for us. And that's more difficult today and it is a more competitive segment. There's no longer a free segment or easy business, it's very competitive. But in the end, I think our assets give us -- I think we've really handicapped this, this Londoner has taken so long, so difficult, now we have all these rooms back open again, we can service the base mass, premium mass. We've done well at the premium mass, we haven't done as well at the base mass, nor has the market provided an opportunity to base mass. But your observations are spot-on. We were the leaders and the margin leaders as well in that base segment, which is much more difficult today. And that's been the conundrum of Macao for us. I think now though, it's a new day. Londoner is open. It's extraordinary, both in terms of scale and quality. I think it introduces all kinds of opportunities for us to maximize that asset and grow again and get back in the game. We're disappointed by our results in every segment. We can do better. We plan to do better. But I think your observations, unfortunately, make that market -- is highly competitive with base mass, premium mass. There is no easy segment anymore in Macao. Grant?

Yes. Shaun, I think to add to the visitation question. Although you do see strong visitation growth and recovery, you can see also from Slide 20 of Dan's deck, the visitation, especially this quarter, has been driven by the day trippers from Guangdong province because they've introduced a couple of new multiple entry visas to Zhuhai and Hengqin. And the non-Guangdong visitation is still only a recovery rate of about 75%. So clearly, the overnight visitation, the customers are going to spend more coming from further away. That's still lagging. But to Rob's point, the base mass is -- the opportunity there has been more challenging for us. And therefore, we are also competing for the revenues in premium mass given a very competitive context in that segment. But that is the strongest segment, you're absolutely right in that observation. But we will continue to drive both premium mass and base mass, especially with the full inventory online now.

And just as a follow-up, and this sort of alludes to, I think, a comment that Patrick made in the prepared remarks about sort of expecting margin improvement as revenue grows. Just I think as we did our math, and this is high level so it could be off a little bit, but Macao OpEx we had up roughly 7% across the properties this quarter. And be kind of curious, is that like the right run rate or are there things you can do to match cost to revenue? Again, maybe this was somewhat inflated by reopening of Londoner, maybe the reopening of the arena at The Venetian, I'm not sure exactly. But it felt like it was a little -- that being up relative to kind of where revenues came in was a bit of a kind of a double issue for you.

Again, your observation is right. The main contributor is just the additional payroll costs that we incurred, both because of salary increases, but also additional head count as we opened up these new assets. But at the same time, obviously, we had a revenue decline in the non-rolling segment. We actually did well in the slot and also rolling. But the most important segment of revenue is the non-rolling tables, and we came down in that segment. So that's where you get that negative operating leverage. So hopefully, we should be seeing the reverse of that over time as we compete with the new assets and the existing properties for the customers and the revenues. And as revenues improve, we should see the positive operating leverage even with the payroll cost increase.

The next question will be from Brandt Montour from Barclays.

So curious, and I know you guys don't give guidance or a comprehensive forward look at the business, but there's been some commentary from the government from other sources that there's a pretty decent momentum into Golden Week in May. I'm just curious if April and/or the Golden Week bookings that you see feel better than normal or worse than normal. Or how would you kind of characterize what you're seeing out there?

I appreciate the question, but we don't talk about the current quarter. So why don't we move on to your next question?

Okay, fair enough. Sure. So next question would be on The Venetian. I'm curious, I understand we kind of talked about the Londoner a lot here and we kind of can see what's going on a little bit with the sequential share losses there because you didn't have the rooms and so it's a tough environment for base mass. But what about The Venetian? Is there something -- can you kind of walk us through maybe the monthly results in that property or how things evolved throughout the quarter? And if that was sort of affected at all by other things in the portfolio and optimization changes that you'd made?

I think it's straightforward, Brandt, I mean, Venetian we just had too sharp a decline in non-rolling revenues, especially in the premium mass segment. And we're addressing that. Obviously, the whole percentage against both prior year and quarter-on-quarter was actually much lower as well. But nonetheless, we're focused on driving the customer and revenues across all segments at Venetian, premium mass and base mass. It's fair to say it's as well-patronized, as well-populated in terms of head count as ever. In fact, we had quite significant growth in non-rolling table head count during the quarter both over the prior year and sequentially. But clearly, the spend per head count was lower. And so we do need to drive to secure higher-value customers in the premium mass segment to grow the revenues back at Venetian.

The next question is coming from Joe Stauff from Susquehanna.

Patrick, Rob, Grant. Two questions on MBS, please. I guess the first one, is there any way to assess, I guess, the level of consumer adoption, especially for the mass customer for prop bets? Naturally, kind of given the higher guidance that you have on VIP, that the adoption rate is higher, but I was just wondering how you guys think about it.

I think it's very difficult. Are you saying how can you handicap people's willingness to bet a certain way? I'm not sure I understand what you're asking.

No. More like the, I guess, the frequency of a mass customer to bet on props versus that of VIP. Obviously, different bet sizes, but just the frequency between the two groups.

I don't think you can actually ever say 100% how people will bet a certain way. But I do think the lower-end customer tends to be -- it's like lottery tickets, they tend to have more -- it's a lesser customer, I think, on the prop bets. And your large bettors, where you're rolling in super high-end, tend to be more flat bettors. But that's not always true. That can reverse as well. And I think the truth is, no one can predict this, but what you are seeing in the market is they are adopting or moving towards these prop bets in a way which I never thought we'd see these. Think about a hold percentage, meaning an entire point. It wasn't that long ago 2.85% was the standard. We're now, Patrick mentioned, 3.7%. It could be 4.1%. The truth is they are adopting these bets every day, both in the base mass, premium mass and rolling segments. How much we keep moving after, I don't know. I can't predict that. I can tell you we've got the ability now, we're confident with the new machinery and our smart tables to tell you what it should be exactly that you'll be able to tell for yourself. But I think people or propensity of bet is very hard to figure out. Some people are [ dive-in-the-well ] bank bettors or player bettors and some love prop bets. I don't think you can pigeonhole any one segment how they're going to bet. We have people at the super high-end who bet props like crazy. And it's hard to imagine betting that kind of money, and the others who would [ dive in a well ] flat bettors. And that's always been the case in gambling. You can't really assess how someone is going to bet if they step up the table. Although people sometimes do see these bets and how we merchandise them. It will be very important in the future of our business to merchandise these bets in a way would get people to bet more in different directions. Flat betting doesn't really help our company's hold percentage or the industry. But I think we're in a new world here in baccarat and it's an astounding new world. We're lucky to have it. Because imagine 1 point, 1.5 points more of hold, what that does, this company's revenues and EBITDA. It's astounding. And we're seeing in Singapore, I think you'll see in Macao as well over time. But you can't really handicap or assess. You can merchandise it better so people see it and have the ability to at least gravitate towards it. We add more games -- as you all say, we also have people who spend their time thinking about developing these new games and how you do that, how we find new prop bets to make and make the games more interesting, and then merchandise it to the customer. So we're actively trying to do that. It's a very big part of our push towards a better hold percentage.

And maybe a follow-up on just the renovations in Tower 3. What -- I guess, very briefly here, are you still on time to finish roughly in June? And what -- just taking inventory of what are the big items still that need to be completed.

So Tower 3 is done, but the key thing is there's some things we're going to be doing in the lobby on the SkyPark over the next 6 to 9 months. But as a lodging capacity, we're there.

The rooms. It's just not the public space, right?

Yes. The rooms are good. It's the public space that we're going to continue do some work on throughout the year. But the rooms are there, and you're going to start seeing the benefit of those rooms in the upcoming quarters.

The next question will be from George Choi from Citigroup.

Now obviously, the introduction of the new side bets was done in Macao only in the middle of last year. I just wonder how popular are these new side bets in Macao thus far. And how does it compare to Singapore? Is there any chance that you could also raise the theoretical hold rate in less than 2 years' time?

George, actually, in terms of introducing new site wages, we had one set of introduction in Q2 of last year and the other latest one in October last year. So progressively, you're seeing strong take-up of all of these new wages. Obviously, Macao is somewhat behind Singapore as a market. Some of these wages were introduced a lot earlier before Macao. So we're only beginning to see the adoption. But the adoption, I would say, is strong. But at this stage, yes, in Singapore, we do see a higher propensity to wager these side wages. But Macao is growing. And over time, who knows. As Rob says, you can't predict the precise distribution. All we know is that the propensity is increasing.

I think with time, George, these two markets become very similar. I believe that long term, it will be very similar with the hold percentage. Before we know it. You're [ advanced ] George, you know this already, right?

Thanks for those kind words. Another question for me is on dividends. So we all appreciate the recent dividend resumption at Sands China. Should we expect the payout ratio to be maintained at around 50% level? And I guess, more importantly, should we expect an increase in the dividends of LVS as a result from Sands China dividend resumption?

So first off, in the honor of Sheldon G. Adelson, I'd like to say, yay dividends, I think that's very important here, very applicable. I think the key thing here is we're very happy that the SCL Board determined to start paying a dividend again at the China level. And we hope to be able to grow that dividend over time as our CapEx rolls off there and as we generate more cash flow through revenue and EBITDA growth. So we're very excited about the opportunity to continue to return on capital at the SCL level and to grow that dividend into the future. I think at the LVS level, what you've seen us do in years past has really been very dividend-heavy. And I think what you're seeing now if you sort of look at our return of capital, which is actually laid out on Page 33 of our book, you can kind of see that our ratio from share repurchase to dividends has been very weighted towards share repurchases. And if you sort of review our prior commentary on this call, you'll see that we're very focused on returning capital through share repurchase both at the LVS level and through the acquisition of further SCL shares. So while we don't necessarily target a specific dividend payout ratio, we do think where we are is healthy and sustainable for the long term for long-term dividend growth. And as SCL continues to grow its dividend over time as we hope, we'll have the ability to return more capital at the LVS level.

The next question will be from Colin Mansfield from CBRE.

Maybe the first one, can you give a little bit of color around what drove the decision to repay the parent loan from Sands China back to the parent? Just given we've talked about that in the past, it's pretty attractive cost of capital relative to where your current spreads are. So just kind of curious what influenced that decision. And how should we think about future ability to dividend cash out of Macao? Was that part of the decision too?

I think the idea was -- that decision was made at the SCL Board level. But the general concept was SCL is performing in a strong way and has growth opportunities, its leverage level is quite low. And I think for SCL, was just negative carry. It was accumulating cash, and why not pay down some prepayable debt since they didn't really no longer needed it, as SCL has access to the investment-grade credit market if there's any reason to create an opportunity for further borrowings. So I think with access to the revolving credit facility that it had, its current capital structure, its leverage levels, the amount of cash that it was generating, it just made sense for SCL to pay back and get rid of some negative carry.

Patrick, maybe a second one for you, maybe, just thinking about capital markets activity coming up with your upcoming refinancings both at the holdco level and also Sands China. You guys are a seasoned investment-grade issuer. How are you guys thinking about timing, potentially tapping the capital markets? Would you potentially lean on the revolver since you have capacity and liquidity there too? Just how you're thinking about that?

So I think you'll see us address the $500 million of LVS bonds in '25 in the near term. And I think we have an approach for that that we're very comfortable with. In regards to the SCL bonds, the $1.625 billion that comes due, we did actually, through the revolver refinancing there, we also initiated a term loan that we had the ability to draw on that amount. So if we choose to access the high-grade credit markets, we have that opportunity or we may put it into the term loan, which is also very favorable and offers a lot of flexibility. So we have an approach to both those maturities in 2025.

The next question is coming from Steve Wieczynski from Stifel.

So a bigger picture question that I'm not even sure you're going to have an answer or not but I'm going to ask it anyway. Rob, clearly, there's a lot of uncertainty around the political environment in both the U.S. and China. I think the fear that's out there is China might, at some point, retaliate against U.S. companies, or something along the lines. And that's where a lot of investors' heads are these days. So I guess the question is, is that something, Rob, that kind of keeps you awake at night? Or do you view your relationship with China in very, very good standing at this point and that risk seems more low, if that makes sense?

First of all, I think we are not in Mainland China, we are in Macao SAR. I think there is a difference, number one. I do think Macao has a different orientation vis-a-vis Beijing. Secondly, to your point, I think we have an incredible relationship with Beijing and we've worked on it for many, many years, and it's very important to us. We're a big believer in the relationship between China and the U.S. We're very disheartened though what's happening right now. Hopefully, we can get back on track. But it doesn't keep me up at night at all. In fact, I think we're in a very good position in Macao. We've been the leader in CapEx, we've been the leader in developing non-gaming assets. Sheldon has a legacy, which stands well. I don't believe this, right now, this dislocation in the countries is sustainable. There has to be a deal between the 2 most powerful countries in the world. I remain steadfast in my belief things come back to a much more normal rational place quickly. They have to. And I'm hoping that happens sooner than I anticipate. But no, it doesn't keep any of us up at night. We feel very committed to Macao and vice versa. It's been a very special relationship with this company. And it began 20-plus years ago when Sheldon first went there and made that pitch for Cotai. I think the Chinese are -- been incredible partners, the government in Macao, people in Beijing, we're grateful for their support over the years. And we continue to believe we'll be there for many years to come beyond the concession. And no, it doesn't keep me up at night at all. I would like to see a stronger relationship between the U.S. and China, like, tonight, because we all need it. Consumers need it. They need it. We need it. It's good for the world. And I'm very disheartened by what I'm seeing, but hopefully, that gets resolved quickly. But no, we're not concerned at all about our position in Macao nor should we be.

And then second question, real quickly, there have been some reports out there that the Singapore government wants to get probably a little bit more aggressive with driving visitation into their country moving forward. And obviously, that should benefit MBS over time. So I guess the question is, have you guys thought about that more in terms of what obviously increased visitation could do to -- you've always kind of given some longer-term projections of what MBS could look like from an EBITDA perspective over time. And has this kind of changed your view around that at all?

So first off, I think Singapore is an unbelievable market for high-value tourists, and Singapore has been very focused on creating opportunities for high-value tourism for many years and investing behind that thesis. And the Air Force, infrastructure and other things that create attractions to help create prominence and desirability to visit Singapore. And so I think for us, it benefits us, but we're also investing with this thesis. So if you look at how we invest, the amenities that we're creating, the way we're positioning ourselves, the way other non-gaming operators are positioning their tourism offerings, it really is a special place. I think for us, it's very motivating and we're very excited to continue to invest there and expand our offerings there. It's a very rare place. Singapore is rarefied air. And it's very special, who goes to Singapore, the consumption habits. If you look at the retail consumption, beverage consumption, the gaming play, the lodging consumption, it's really unique. And I think it's driven because of the overall goal of the government of Singapore, which is to create the opportunity for high-value tourism. And so we've been benefiting from it for the last 15 years. And the Singapore government has been great in terms of investing in the assets that drive tourism, and we've been investing behind that.

I have to say though, as much as Singapore is a wonderful place, our asset is a wonderful asset within that place. And we've created our own very special place within the great state of Singapore. I think what we've done there is extraordinary. And it attracts those people because there's nothing like it in the region. There's nothing that special. It's very seductive, the rooms, the product, [ everything is ] amazing, and it has enhanced Singapore and vice versa. So going back to the vision of Singapore government is amazing, our vision is pretty good too, what we've build over there.

The next question will be from Ben Chaiken from Mizuho.

First, in MBS, great margin results and strong mass performance. Just remind us, would you say that 1Q '25 had a difficult comparison year-over-year from the large concert in the prior year as well as the easing of the China visitation policy which I believe was also in the prior year? Or was this a pretty clean comparison year-over-year? Then one follow-up.

Well, first off, I think both quarters were awesome. So it's a tough comp. But as a practical matter, this was a totally normal quarter. So I would say that there wasn't anything extraordinary that happened in the quarter. This is pretty indicative of the performance of the business without any sort of anything that's out of the ordinary.

There wasn't Taylor Swift there.

And I think the key thing here is we really have been able to put the entire asset to work, which is something we haven't been able to do for a while because of all the construction activity. So we're really getting close to being able to see this thing really get to the point where it's not experiencing any interruption due to development work. And I think the key thing is this quarter was very normal. To your point, last year's quarter did have the Taylor Swift concert, did have a lot of other things going on that created very strong demand and very strong visitation. This quarter didn't, and so we're very fortunate that we had the results that we did. Credit to the team that did phenomenal work. As Rob just referenced, the building is in phenomenal shape. We think it's the best building in the world, and we're proud of what we've accomplished. But you can see the results from the activities there.

Yes, great result there. And then switching to Macao. Maybe just touching on the sequential market share in Macao again, fully recognizing that you had rooms out of service in 1Q, but also acknowledging that rooms out of service in 4Q as well. I guess is the interpretation, just from some of the previous commentary, that it's harder for you to leverage the current type of gameplay or player in Macao as it stands?

I think sequentially our room count moved up marginally. So we're about 8,900 both for Q4 and 9,100 or 9,200 in Q1. I think in terms of the Londoner Grand ramp-up, that was really a very soft ramp for Q1 because we didn't have all of the rooms. And therefore, it didn't make sense for us to operate as many gaming units in the Londoner Grand Casino for the first quarter. But from now on, from April, you'll see obviously us in full ramp-up mode. So I'm not sure that answers the question, but is there something else that you're asking that we haven't addressed?

No, that's fine. I appreciate it. Thank you.

And the final question today will be coming from David Katz from Jefferies.

I just want to go back to some of the earlier commentary and questions, because I heard the word competition and competitive market in Macao quite a bit, having been there not all that long ago and heard a lot of the on-the-ground commentary about more of a benign promotional environment. Are you suggesting that we might start to see that change as part of the Londoner ramp-up? When you use the word competition, what do you mean by that?

We mean competition, people are fighting for various segments and it's across the board. I'm not sure what you mean benign like that, David, because I don't see it as benign. There was a time when base mass was benign and it fell in the door and no one gave anything. Those days are gone. So I think it is highly competitive. Again, our asset base is the best in class and scale and size. So I think we will do better. But I think it'd be foolish to think a non-growing market with a top line [indiscernible] not expected we'd be competitive, and that reflects, everyone's business, not just ours. So I'm not saying it's outsized, but there's really competition. There's competition. Grant?

Yes. I don't have to add to Rob's comment. I think it's always been very, very competitive. I think we've just got to look at the competitive context, use the new assets that we have and the advantages of scale and the product that we have to really compete harder to get more revenue and customer growth. That's all we're saying. I think the market has been very competitive. It hasn't -- I don't think there's been any significant deterioration in that. But we've also got to reflect and see where our position is within that context. And with all of the new rooms online, we fully intend to compete hard to get more revenue.

Reduced liquidity, obviously, from 2019, reduced the top line results. So in any market where you shrink by $6 billion to $8 billion, $10 billion, you're going to see more competition to the existing dollars out there, and we're seeing that in Macao. I'm not saying we can't compete, we compete pretty well, but I think it'd be foolish not to recognize that base mass, premium mass, rolling, every segment in Macao is under pressure in terms of getting your fair share.

And if I can just follow that up. One of the observations is -- and I think some of the earlier questions were to this end, is that the premium mass arena seems to be getting quite a bit more crowded. Part of my question was, are you planning to get more promotional? And I think that's what the word benign is really attached to, whether operators start becoming more promotional in how they compete.

I'm not sure -- I think in terms of promotional, you have to look at it in different ways. I mean firstly, we're going to aggressively deploy our new assets. I think that's first and foremost. We have the largest scale in terms of the [ bet ] products and [ slot machine ] products. and we need to drive that as hard as we can to maximize that scale advantage across all product types and across all price points. That's the second piece. In terms of marketing activities, there's always going to be tactical promotions that you implement. Every operator does. I think we're just going to be very active in engaging existing and new customers and reactivating all customers with the full inventory that we're going to have at our disposal. And we're going to drive that very hard because we intend to gain customers and gain revenue.

Thank you.

Thank you. This does conclude today's Q&A session, and it 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.