Las Vegas Sands swings to loss in fourth quarter

By Amanda Finnegan (contact)

Published Wednesday, Feb. 11, 2009 | 2:13 p.m.

Updated Wednesday, Feb. 11, 2009 | 5 p.m.

The economic downturn was felt at Las Vegas Sands in the fourth quarter, as the owner of the Venetian and Palazzo on the Strip reported a loss.

The company said it had a net loss of $111.3 million, or 27 cents per share, for the fourth quarter of 2008 compared to a profit of $39.8 million, or 11 cents per share, in the comparable period for 2007.

Excluding one-time items, the company reported an adjusted net loss of $17.8 million, compared to a net income of $71.1 million in the same period for 2007.

Net revenues for the fourth quarter increased 4.3 percent to $1.09 billion, compared to $1.05 billion in the fourth quarter of 2007.

"Our fourth quarter results reflect a respectable operating performance against our first objective, as our properties in Las Vegas and Macao delivered solid cash flows in the face of challenging economic environments in both markets,” president and chief operating officer William Weidner said.

Room occupancy dipped at the Venetian for the quarter, from 94.8 percent to 91.9 percent. Average daily room rates fell 21.3 percent, from $258 to $203. At the Palazzo, occupancy was at 96 percent with room rates at $217.

Weidner said the “Las Vegas properties continue to generate significant cash flow” but noted that visitors are spending substantially less.

He said strong group and convention business has helped to insulate the company and keep average daily room rates high during the week.

Las Vegas casino revenues increased 16.2 percent from $116.1 million to $134.9 million. Food/beverage and room revenues increased 39.9 percent and 40.7, respectively.

Since November, Las Vegas Sands has laid off more than 250 employees from its Strip properties. Also in November, the company announced it would be pulling the plug on a $600 million Strip condo project and on unfinished Macau projects, resulting in a layoff of 11,000 construction workers in Macau. The company spent more than $1 billion putting the projects on hold.

Despite the hold on other projects, Weidner said developments in Singapore and Bethlehem, Pa., are “on schedule and on budget.” The $5.4 billion Marina Bay Sands casino in Singapore is scheduled to open in late 2009 and the $473 million Bethlehem property is scheduled to open in late May or early June this year.

Sands' shares closed up 6.1 percent at $3.98 before the earnings report. Shares traded at $4.24 after hours.