Sands China loses US$180 million to COVID-19

The Macau operator has issued a financial statement detailing the impact of the pandemic on its revenue in the first quarter of 2020.

China.- Sands China has published a statement revealing the impact of the COVID-19 pandemic on its financial results.

Due to the drop in travelling and gaming spending, the company took only US$9 million in net revenues in April, leading to a net loss of US$180 million.

Net revenues for the first trimester ending March 31 were US$808 million, a decrease of 65.3 per cent compared with revenue of US$2.33 billion in the same period in 2019.

April’s results were even more disheartening. The Macao Government estimated monthly gross gaming revenue and total visitation from mainland China decreased by 96.8% and 99.6%, respectively. Sands China took only US$9 million in net revenue, a 98.7% fall on the same month in 2019.  

The company estimates that running its business in the current operating environment implies a “monthly run-rate of operating costs of approximately US$110 million, development and maintenance capital expenditures of approximately US$65 million and approximately US$25 million for interest expense.”

The operator has taken mitigating measures and foresees that, with its strong balance sheet and sufficient liquidity in place, it can fund its operations for twelve months in the current operating environment. However it said it expected the impact of the pandemic on its financials “will be material”, and cannot be reasonably estimated at the time.

In a business update sent to the Hong Kong Stock Exchange, the company said: “The Macao Government has announced publicly that total visitation from mainland China to Macao decreased by 14.9 per cent in January 2020 (with an 83.3 per cent decrease in visitation over the first seven days of Chinese New Year), 97.2 per cent in February 2020 and 96.3 per cent in March 2020 as compared to the same periods in 2019. It has also announced that monthly gross gaming revenue decreased by 11.3 per cent, 87.8 per cent and 79.7 per cent in January, February and March 2020, respectively, as compared to the same periods in 2019.”