Good afternoon. My name is Thea, and I will be the conference operator today. At this time, I would like to welcome everyone to the Las Vegas Sands Corp. First Quarter 2013 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question at that time, simply press star and the number 1 on your telephone keypad. If you would like to withdraw the question, press the pound key. Thank you. I will now turn the conference over to Mr. Daniel Briggs, Vice President of Investor Relations. Sir, you may begin.
Thank you. 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 these 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 earnings per share, adjusted property EBITDA, hold adjusted property EBITDA, and hold adjusted diluted earnings per share, which are non-GAAP measures. A definition and a reconciliation of each of these measures to the most comparable GAAP measures are included in the press release. Please note that this presentation is being recorded.
We also want to inform you that we have posted supplementary earnings materials on our investor relations website for your use. With that, let me please introduce our chairman, Mr. Sheldon G. Adelson.
Thanks, Dan. Good afternoon, everyone, and thank you for joining us today. We look forward to answering your questions in just a few minutes. We're obviously pleased with the all-time record quarterly financial results. Those results reflect strong revenue and cash flow growth. As I've mentioned in our previous calls, the continued execution of our four strategic objectives to maximize shareholder value. I'd like to provide a progress report on those objectives now. One, maximize organic growth from our property portfolio. Two, deliver additional growth by making new investments in our current markets to enhance growth. Three, identify new IR development opportunities in geographic areas outside of our current markets. Four, this is a good one, increase the return of capital to shareholders. First, organic growth.
I will highlight our all-time record performance in Macau, where our industry-leading investments and the unrivaled scale of our properties have again enabled us to deliver robust, market-leading growth in the world's largest and most profitable gaming market. Our mass table win in Macau for the quarter was up a whopping 63.2% to a record $863 million. Our $9 billion of capital investments in Macau were targeted toward and designed to serve the mass segment from the very beginning and have allowed us to lead the Macau market in EBITDA generation since we entered the market way back in 2004. Our market-leading hotel, retail, convention, group meeting, and entertainment offerings will allow us to continue to lead the Macau market in both revenues for mass gaming and in EBITDA generation for the foreseeable future.
Also impressive is our rolling growth in Macau, which was up 24.9% this quarter to a record $41 billion. That represents VIP market share of approximately 17.4% of Macau market rolling volume, compared to just 12.6% one year ago. That's a 38% increase in market share of rolling volume. Sands Cotai Central continues its steady run, with both the mass table and slot businesses reflecting meaningful growth this quarter. We welcome a record 14 million visits to our Macau properties in the quarter. If you annualize that means we are bringing in almost two visits for every official visit to Macau. So if we get 60 million visits in our properties, that means that we're getting two visits for each, assuming 28 million to 30 million visitors to Macau. So each Macau visit, we're experiencing two visits.
A fully enclosed pedestrian walkway with escalators and moving sidewalks has successfully interconnected our Cotai Strip properties, enabling customers to more comfortably move between our properties and allowing them to enjoy the full array of amenities on offer throughout our entire Cotai Strip property portfolio. That means you can go between almost 9,000 rooms without stepping outside. It's probably the only pedestrian bridge with moving sidewalks and air conditioning anywhere. The interconnection of our properties is contributing to enhanced financial performance today. As the hotel inventory of Sands Cotai Central becomes more productive and our Cotai Strip offerings continue to evolve, that interconnectivity should contribute meaningfully to our financial Now we're turning to Marina Bay Sands in Singapore. Organic growth was again on display in our results.
The record $18.2 billion in rolling volume was up over 42% compared to last year, and was the highest quarterly volume in the history of the Singapore market. If we had held 2.85% against that rolling volume, we would have produced EBITDA of $451 million this quarter at Marina Bay Sands. That is the strongest total adjusted performance in the history of the property. Organic growth was also on display in our mass table win, which was up 7% as growth from visitors to Singapore continued to expand. Growth was also on display in our hotel revenues, which were up 10%, and our retail revenues, which expanded 7%. Let's turn to strategic objective number 2, development growth in our current markets. The Parisian Macao, our fourth integrated resort property on the Cotai Strip, and our fifth in Macao overall, is now under construction.
The Parisian will add another interconnected integrated resort property to our portfolio on the Cotai Strip. The piling construction is now underway, and the podium and hotel tower substructure work will commence shortly. Based on our current construction schedule and subject to timely government approvals, we're still targeting the opening of The Parisian for late 2015. We've also submitted plans to the Macao government for the development of a 2 million square foot Tropical Garden retail mall just south of Sands Cotai Central on the east side of the Cotai Strip. The mall would feature over 900,000 square feet of value-oriented destination shopping and dining, targeted specifically at the mass-market visitor. We commend the Macao government for the way they have encouraged the growth of the mass market and encourage the development of mass-market targeted non-gaming amenities such as our proposed Tropical Garden retail mall.
Moving on to strategic objective number 3, development of integrated resorts in new markets and geographic areas. At Johor Bahru, we are committed to identifying new development opportunities in Asia and work in that region too. We have also been investigating opportunities in other parts of the world. As we have previously discussed, in December of last year, the government of the region of Madrid passed legislation that outlined the regulatory framework to enable integrated resort development in Madrid. There are a variety of steps left in development process, which continues to move along. Any investment would be subject to the receipt of government approvals and the finalization of a grants and incentive package that would enable investment as well as success in a competitive tender process. As the company's largest shareholder, my interests are aligned with yours.
I have a vested interest in pursuing only the highest value projects that will maximize shareholder returns. To strategic objective number 4, return of capital to shareholders. We have now returned $4 billion of cash to our shareholders through dividends over the last 5 quarters, including nearly $3.4 billion from Las Vegas Sands shareholders and nearly $600 million to the non-LVS shareholders of Sands China. It is gratifying that we have now built our businesses and expanded their cash flows to the degree that we are able to return such substantial sums to shareholders while retaining both a strong balance sheet and sufficient liquidity to fund future growth opportunities. We have every intention of increasing the return dividend at both Las Vegas Sands and Sands China in the quarters ahead as our business and cash flows continue to consistently grow.
We will also seriously consider other avenues to return capital to shareholders in the future, including special dividends and the implementation of a stock repurchase program. Before moving to your questions, I want to again highlight that our retail mall business in Asia continues to grow. We expect that growth to continue this year and to accelerate in the future as we re-merchandise the malls in both Macao and Singapore. Eventual sale or monetization of those assets will provide enhanced financial flexibility, including the potential to increase the return of capital to shareholders in the future. With our outstanding strategic positioning and strong operating momentum and the disciplined, experienced leadership team we have in place to execute our strategy, I couldn't be more optimistic about the future. Yay, return of capital. Let me turn the call over to Mike to begin the Q&A session.
Thank you, Sheldon. Good afternoon, everybody. Operator, may we please have the first question?
Yes, sir. The first
While the operator is popping the question, let me just ask everyone to keep your questions to one question and one follow-up to allow everybody to have an opportunity to participate. Thanks.
The first question will come from Joe Greff with J.P. Morgan.
Good afternoon, everybody. Question for all of you, maybe specifically for Rob. Singapore mass tables and slot volumes per day showed a nice sequential and year-over-year uptick. I know you've been talking about getting the mass positioned correctly. Can you talk about what the drivers were for that performance and whether it's the new hires that you put in that market, whether you're marketing differently with the health of the overall market? What specifically are you doing, and how sustainable is that?
Yeah, Joe, as you know, Singapore, that's the best quarter we've had. It measures up to the first quarter of the previous year. We're back to a run rate of 4.6. The answer is twofold. On the slot segment, we continue to show weakness, and that's because slots are primarily driven by the local market, which has not recovered. On the table side, we're growing again, and that's because of the programs in place, both to accelerate new customers to the building and also reactivate the existing database. We're seeing a tale of two stories there, and I think we'll continue to see table growth. We're hoping to see more growth on the slot side as well. Clearly, we're back in a positive place in Singapore on the most important segment, the non-rolling and slot and ETG segment.
We're seeing some results that come out of the reactivation of the database. Clearly, we're seeing new customers as well. We're happy to see it. We hope it continues, and the team is adding people by the day. We should be at 20 hires by the end of the year, and I think we'll see real growth in that segment in the quarters ahead.
Excellent. As my follow-up then, Sheldon, would love to get your thoughts and recent views on some of the goings-on in Japan with respect to IR legislation. How real does it feel now versus some of the fits and starts that we've seen in the past?
Mike says he wants to answer that question.
Joe, thank you, Sheldon. There's a lot of noise about Japan, about 100 people in the legislature wanting to get legislation as early as November. The most recent conversations we've had was that looks like when it might appear. As of this morning, there was another article that said that if the legislation passes, it's a one to two-year process to get it ready to go. In terms of selection of those particular companies, and the news has been really us and Genting as two of the leaders in terms of looking at that marketplace. We hope it could move faster, but essentially Japan, it's a little more active than it has been because of the November situation. Although there was some talk from Osaka about the possibility of moving that legislation up to the summer.
Our best knowledge to date from the ground is November looks like the time for the first legislation.
Great. Thank you. Good work, guys.
Thank you.
The next question will come from Thomas Allen with Morgan Stanley.
Hi, guys.
Hi.
On Sands Cotai Central, you continue to ramp that property. Is there anything saying that you couldn't do close to the same EBITDA as you do at The Venetian? Just on the margins, I guess they were a little lighter than we had expected. Can you talk about how those should ramp? Thank you.
To answer your question, I think The Venetian obviously is the biggest performer in the market. It's ramping to $1.5 billion, and I think that's a little bit ambitious for SCL today in this current situation. However, it's a different product. You don't have the theming, The Venetian theming, nor the retail component, which I think are the primary drivers of foot traffic in The Venetian. Sheldon referenced on the opening remarks how important the visitation is, and The Venetian gets a disproportionate share of visitation because of theming and fabulous retail and food offerings. Having said that, obviously, the biggest advantage that Sands Cotai Central has is the room product and the diversity and size of rooms. I believe it will continue to ramp, and two things have to happen. The miss at Cotai against The Venetian comes from primarily mass tables.
In all three segments, both the super premium mass, the premium mass, and mass mass tables at Sands Cotai Central have not gotten to the kind of numbers that we do at The Venetian. They'll ramp as the rooms fill, as we get more promotion, more aggressive on that. Clearly, there's massive opportunity. We've grown to a number. It's respectable, but it could be a lot higher win per unit per day. The junket segment is the highest performer in our portfolio, and slot ETG is getting close to The Venetian numbers. It gets better, and the spread gets smaller per quarter. The whole key to the Sands Cotai Central story is going to be filling those rooms, taking advantage of that 6,000-key opportunity, the crossover bridge, et cetera. I have every confidence that SCL is a $1 billion EBITDA property in the future.
I don't know if it can ever reach the kind of numbers that The Venetian is going to get to because The Venetian keeps growing. It looks to me like it's going to grow to $1.4 billion, $1.5 billion, $1.6 billion. It's a phenomenal property, and it hits on all cylinders. SCL, I do think, is a $1 billion property, and the primary driver will be that mass table segment. If we can get that thing to 11,000, 12,000 there like The Venetian does, we'll be at $1 billion, and that's the answer in a nutshell.
There's another nutshell there.
Okay.
I'm the blind squirrel who found the nutshell yesterday. I can see ahead. I'm a visionary. I can see through the fog and the snow. We're spending a few bucks on what was formerly expected to be a theater. I think it's about a 40,000 sq ft footprint that we're going to enlarge. We put in the premium mass the property, Sands Cotai Central, because that was the one that we stopped, if you remember, in the middle of the, or at the end of the financial crisis. We started up a couple of years later. There was no premium mass market identified as such to that. We didn't leave enough room in the high limit, the Ruby, and the Diamond categories, what we call aspirational categories, before we get the Plaza cash and then the VIP rooms.
We're putting in another 80 some odd tables, pushing 100 tables. We're taking underperforming. We're not the only ones. Our competitors, I'm sure, are doing the same thing. They're putting their underperforming tables to better use and increased revenue. I've approved the expenditure. We got the CapEx approval from our board of directors meeting yesterday, and we're moving forward on that. That is going to take about 10 months or so, maybe a little more, 10 to 12 months. It'll be ready, I think, next April.
Correct.
Is it next April?
It does, yeah.
We've got about 10, 11 months yet to go. The delay in that is that we never put in, because we didn't know where we were going to put in, we never put in pilings underneath that space. We got to get the piling machines into an already built building and then get them to work, and the excavation and piling machines, so that'll take an extra period of time. There is a lot of potential upside, filling up the rooms, getting more mass market, creating the capacity, and putting the tables to good use. I don't know if it'll get to where The Venetian is, but as you said, The Venetian is a very unique property. I think it gets to where The Venetian was before.
I agree.
Who knows what'll happen over the long term.
I think Sheldon's comments are great because they reflect the-
Of course they're great.
They're great. Of course they're great.
That's why I get the big bucks.
I think you should realize the opportunities in the segment you referenced, the super premium and premium, but also in the mass, what makes us unique at our company is that other people don't have that capacity to grow. Our mass tables at The Venetian are just extraordinary performers. If we can get there at SCC, it's going to be some very good days ahead for that property.
Okay. Just a quick follow-up on the mass and premium mass in Macao. One of your competitors talked about how on the mass side, he was seeing more customers purchasing chips at the cage instead of at the table. Were you seeing something similar? I noticed a high hold at The Venetian in the first quarter. Was that kind of driving that? Thanks.
It's an interesting question you raise because, I heard the call, and I think the answer is simple. Cage drop is a phenomenon you're experiencing in Macao. In most jurisdictions, you don't have cage drop. It's about 25% of our drop, and we certainly can give you those numbers as well as a part of the entire drop program. We hold about 25%-26% since we've opened SCL, about 23%-24% on mass play in MBS. Cage drop is a component, so we're clear about that mostly impacts the super premium and premium mass because you can't buy renminbi back at the table. You can't cash in renminbi at the table. It's against foreign currency restrictions. You have to buy at the cage. That's why that phenomenon happens.
You can't process the money easily because it's small denomination. It's a cage function, logistically works better that way. Having said that, we're very confident that across the entire portfolio, we handle about, probably this year it's about $14 billion-$15 billion consolidated. We'll hold about 25%-26% of that. We know the hold percentage. We know where the customers buy the chips, be it cage or tables, only two sources. What we can't be consistent about is if the customers move money between a property or a segment, like what Steve was referencing, the difficulties knowing which segment they're losing at. That affects that hold percentage. In the aggregate, we do know where that's at, and it's not a confusion for us nor anybody else in the marketplace.
The nice thing is, as we keep growing drop, we're getting to a point where we can hold 25%, 26%, 27%, again, for what appears to be growing to a business we could see ourselves getting $4 billion of top line out of this next year. It's a phenomenon because of the foreign exchange situation and the size of the bills.
I intend to continue ramping up in all properties because we're going to wake up Rob sleeping.
Right.
We're going to crack the whip on him.
Right. Good idea. Who was that? Did I answer your question?
Yep. That was great. Thank you.
Thank you.
The next question will come from Shaun Kelley.
Hey, good afternoon, guys. I guess my first question would be maybe a little bit around The Parisian. I think in the prepared remarks, Sheldon mentioned that you're still targeting a late 2015 opening, but I noticed on the CapEx schedule, you actually brought down your target CapEx for this year. Can you just give us an update on if you've broken ground? Are you driving piles on the property and kind of where the status of that project sits right now?
Well, I had a conversation with Mike Lentz, the head of development, yesterday, who continues to be more and more impressive as time goes on. Ed Cooper, who's a descendant of Kukla, Fran and Ollie. He says he's related to them. He said yesterday that the piling caps. Here we are on May 1st. In June, we're going to start the piling caps, which is, really think of it as the foundation. It's like a mat foundation, like we did this Venetian here, we did a mat foundation in Vegas. Think of it as the foundation. That's where you put the structure. We're going to do it on a gradual basis from one end to the other. As soon as we finish enough pilings, we're putting the pile caps on, and as soon as we finish enough pile caps, we're going to start the structure.
That was quite a good surprise to me yesterday. That's the process. I think there are two different types of pile caps. There is poured concrete pile caps, like you put a big pipe in the ground, you put a lot of concrete in it, then there is the driven piles. You've heard of driven snow, we got driven piles. There's no snow in Macau. They're moving along on the piles. The date to open in 2015, I'm cracking the whip to try to get it done by the middle of 2015. We're not looking at always at a delay like we've had in the past. We're looking for always a shorter period. Every month we don't open is the fruits of an investment. We're losing whatever it is. We could lose $50 million a month to start off with.
If we spend an extra $50 million to accelerate the project, how many more months do we open faster, we get a big return on investment.
That's helpful. I guess my follow-up would be, I guess also in the prepared remarks, you talked a little bit about return of capital. I guess the question that comes to mind and that we get from a lot of investors, I think once you compared yourselves to Apple, I couldn't help but notice this week that Apple did a $17 billion bond offering to help return capital to shareholders. How do you guys think about target leverage, would you be willing to put a timeline around next steps on the return on capital initiatives?
I'd like to tell you, Shaun, you're too nice a guy that I'd have to kill you if I tell you. It's a fairly selective disclosure. I can be honest enough because I think this is not selective disclosure on this call. We are very actively considering it. It is on the table. We had lengthy discussion at our board meeting about it. We have a very positive attitude to doing this. We're not at the finish line yet, we're in our final stretch.
Shaun, do you think we could get $17 billion at 1.9%?
I'm not sure, we can talk to our capital markets guy and get back to you.
Former banker.
Thanks a lot.
I think that we're at the point where we're discovering should we have a fixed amount for 10 years or should we have a floating amount and buy up 50% of what we fix the rates. If we're at that point, we're getting close to it. We lost him. We need Next question.
The next question will come from John Choi with CLSA.
John, hi, guys. Good afternoon.
Good afternoon, John.
All right. I'll start off with, in Macau, could you give us some anecdotal updates on visitation and spending trends from your customers, especially in the high-end level, especially post the political transition in China in March? What have we seen, and what are you expecting in this Golden Week in May?
You're going to know the Golden Week numbers very shortly, I'm sure.
In Golden Week, we're not looking for silver. We're looking for gold.
I think, John, one of the things, all the noise from the government, it doesn't seem to be impacting what's happening to us. You see that in the first quarter. I think what's happened is the numbers from Macau come out, I guess, every week or so. We haven't seen any impact whatsoever on any of the noise about the government. I think visitation, it's public. The amount of money that each person is spending seems to be more. The rooms have helped us. I think the Cotai Strip has helped everybody. There's been no negative impact that we've seen so far this year, and I don't see what the government's been saying that has really impacted us at all.
Rob may have other details on that. We have a big spread of market in all of our properties from the low limit to the high limit, and they all seem to be getting their appropriate share of the marketplace.
John, it's Rob. I think the numbers speak for themselves in terms of VIP demand or lack of demand in the marketplace. You can see that for yourself. I think our strength resides in the mass and the slot ETG market, and I think those segments are growing like crazy, and that, coupled with the infrastructure, is a very, very strong story for us. As we have 1,000 tables open and 5,000 slot ETG units, I think our growth is tied for sure to the mass demand, and that mass demand is staggering. As for VIP, time will tell, and we'll wait to see how it plays out. Our opportunity, I think, is in the mass and slot ETG markets short-term, and we'll ride the wave and see what the government, how that works out.
We're very, very pleased with our growth in those important segments for us and profitability.
Great. That's helpful. If I could just ask a follow-up on Singapore. We've seen two sequential quarters now where rolling chip, I believe, is above SGD 16 billion. I can't help but noticing also that it's been four quarters in a row where you've been holding light in Singapore. Could you give us some sense of what's actually going on in the VIP space? Are we going to be experiencing less volatility in rolling chip? Should we, at some point, expect some normalization of hold? I know it's a very theoretical question, but four quarters in a row, what's actually happening in there?
Customers keep winning. That's our deep analysis. Very candidly, it's frustrating for us because the volumes are terrific. It's a mathematically driven model, isn't it? In the end, we let people bet $1 million a hand. Some nights they get lucky, some nights we get lucky. It's been disappointing because you normalize it, and we fully believe it'll normalize. Our team has looked at it every which way you can over there, and one of these quarters or probably one of these years will hold 3.2%, 3.3%. We have absolutely no concern about that whatsoever. We've been through this before. Last year in Las Vegas, we held abysmally during the Chinese New Year. People said, "Oh my God. The Chinese people are winning in some capital of the games." We held something like 45% the next quarter.
We're very pleased about our growth in Singapore. Again, it's a very concentrated market. One quarter shouldn't be a predictor of the next quarter. We're very happy with getting SGD 18.2 billion, our best quarter ever. We're very pleased about that. We're also a complete believer in the mathematical indications of the game. No trepidation or concern whatsoever. It'll normalize and be what it should be by the end of the year.
I don't know, John. This is Sheldon. I don't know whether or not our overall strategic approach to the Singapore market has an effect on it. Maybe you could figure it out. We take bets up to SGD 1 billion.
We're crazy.
$1 billion.
No, SGD 1 million.
Oh, okay.
$1 million.
Guys who have change of $1 billion, we will take that, too. That is what I said to everybody when I get solicitation calls for charities. I say, "Have you got change of opinion?" If you do, I will contribute. The point is, I don't know, since nobody has ever done this before, nobody has ever figured out the mathematics. If we take a $1 million bet, a lot of $1 million bets. Certainly not everybody does it, and not every bettor will bet $1 million every hand. It may have a direct impact on the percentage. Nobody has figured that out yet.
We are holding 262 lifetime, John, and I think when it is all said and done, it will be over 280 at the end of this year or next. It is going to turn around some, it always does. Las Vegas has been doing this for a long time, and Las Vegas we have been doing it for about 13 years, and we held about 25%-26% on the high-end baccarat. I assume it's going to normalize and we will be just fine in Singapore.
It is the most profitable building in the history of buildings. Not even the pyramids have made more money.
They have got to take a hold inside the tomb. Anything else, John?
All right. That's great. Congratulations. Thank you.
Thank you.
Thanks, John.
The next question will come from Felicia Hendrix with Barclays.
Hi, good afternoon. Just staying on Singapore for a moment. On the VIP side, is there any way to tell what % of that strong roll was generated by newly acquired players? Also just wondering where they're from. Are they still mainly Chinese?
The majority of our business comes out of Singaporean Chinese or mainland Chinese, yes. The majority, over probably 70%, is out of mainland or Chinese people who have bought a second home and are PRs in Singapore. However, we're getting a lot of play out of Indonesia. Some very strong business out of Indonesia and some great business out of Malaysia as well. It's still predominantly mainland coupled with PRs out of Singapore, Felicia.
It's where the people are, China.
No, I recognize that. I just know that you've been on a program to obviously grow that base of players. Just wondering if you're seeing some more diversification.
Yeah. We are seeing diversification, but primarily in the non-rolling segment. Our biggest growth of new customers has been in non-rolling segment. We have seen new business out of Indonesia and mainland for sure. Again, I caution it's still a very concentrated market in the rolling segment. The diversification and growth into the new customers primarily resides in the non-rolling segment.
Okay. I guess that gets to the predictability question of just going forward in terms of still being a concentrated number on the VIP side, correct?
Yes.
Okay.
It remains concentrated, again, I always caution you that 18 this quarter doesn't mean 22. We did that a couple of years ago, won't do it again because it's not an easy predictor. I think we could see a $19 million quarter, but we could also see a $13 million. Chinese New Year's first quarter always is pretty strong. I think that's as much as we can say about that.
Okay, thanks. Just switching gears quickly to Macao. Your growth in the mass table win yields has been impressive, and I'm sure we're going to see that continue to grow as you reconfigure the Four Seasons, you add space in Sands Cotai. Just wondering, how competitive is the market right now on the mass table side? Are you seeing any of your competitors getting more aggressive?
I think it's competitive. Obviously, you have three segments there. Our strength resides in the pure mass, which, because of our table size and capacity, I think we dominate that segment. The premium mass and super premium mass are obviously very competitive. I don't think it's become unreasonable or overly incented to the point where we find it is still a very high margin, 38%-39% margin business for us. I don't think it's unreasonable. Anytime you see a business growing like that business is growing with those ridiculous year-on-year comparisons, you're going to see competitive nature. Very smart people in Macau working very hard. I think the Melco people, especially in Galaxy and Wynn, MGM, all competing for that segment. However, we've not seen unreasonable incenting. I think everyone's making a lot of money on that segment.
Let's be clear, it is a growth engine in Macau in terms of making our EBITDA. Our goal is to re-segment the Four Seasons, getting more. We did $14,200 per table in the Four Seasons. We want to re-segment that, get a lot more aggressive in that mass table market, or I should say, premium mass table market. We want to grow our business, especially at the SCL. We're thrilled with the business out of Venetian, the number of tables. We could win $1 billion in the future out of the mass tables alone at the Venetian. It's extraordinary. We're pleased downtown. The Sands, we've taken a new approach downtown, and I think to make $100 million in a place that's approaching its 10th anniversary is pretty extraordinary, too. There's work ahead of us.
As happy as $10,200 per table appears to be, I believe there's material upside to this company in years ahead in Macau in the mass table segment.
Great. Thanks, guys.
Sure.
The next question will come from Carlo Santarelli with Deutsche Bank.
Hey, guys. Good afternoon. Sheldon, obviously, you outlined a couple strategies for capital deployment in your remarks earlier, but the one thing you didn't mention, and as I look through your release, and for a couple quarters in a row now, you guys have done a nice job breaking out the details of some of your Macau, obviously, the retail opportunities, et cetera. Has there been a lot of thought put into maybe some strategic decision-making around them as a source of capital?
Yes, there has been. We don't fail to look at opportunities. The problem with that is we keep growing more than what we expect. We really haven't yet stabilized because we continue to enjoy robust growth. We certainly don't want to sell if we can get 30%-35% growth potential of what we expect for the following year. It's just doing very well, and I'm not sure that we could ever stabilize and slow down the growth to the point where it stabilizes until we open all the retail that's there. We have the Parisian retail, we have the Tropical Garden retail. That middle mall, which the government is very excited about because they want non-gaming development, is almost three times the size of the Parisian mall. We'll have quite a bit of retail connected without leaving an air-conditioned space.
We just opened up, I heard, 16 more retail shops on multiple levels in Sands Cotai Central. It's still there. We can convert that almost any day that we want, but there's no reason to sell it. One, if we don't need the money, and two, it continues to grow at a much greater rate than what we can expect in the shorter term after paying taxes and reinvesting the money. I haven't added up lately, but there was $8 billion-$10 billion of profit coming out of the sale of the malls. That is a very strong corroboration of the original business model I dreamt up a long time ago. The problem with some of our competitors is somebody at Mandalay Bay tried to copy our business model on a convention-based market, but they never got the retail off the ground. The retail and the apartments.
The retail itself could really pay the cost of our core assets of a hotel, casino, and convention space and entertainment. No use selling when we continue to grow more than what we can reinvest the money to.
That's very helpful. Thank you.
You're welcome.
The next question will come from Steven Kent with Goldman Sachs.
Hi, good afternoon. I'm just looking at your slide on 18 of 41 where it says, "Our focus in Singapore, increasing visitations to Singapore, which will drive growth at MBS, and then identifying high-value customers through to the region and bringing them to MBS." I just want to be clear on the first point. Increasing visitation to Singapore, is that just a broad tourism initiative that you're going to embrace? And especially on the mass side, where are you seeing those customers coming from, and are you putting your sales force into some of the East Asian countries to get that traction? But I'm just trying to understand that focus in Singapore, what you're really trying to do. Is it mass? Is it a broad tourism push? Is it sending your own people out into some of the Southeast Asian countries to get people into your casinos?
Well, Steve, from the gaming side, it's clearly a very clear focus on the premium mass gaming customer. The goal here from our perspective is to build a team. We're building that team every day of people that went to JB, Malaysia, Indonesia, Jakarta, Tokyo, Thailand
Vietnam and find the better premium customers and bring them to MBS to gamble. It's pretty black and white, the same way that we saw that business grow terrifically from the opening of Singapore. Then it fell off as it was restrained by the government. Our goal is to build that business back up. That's why we're at $4.6 million a day. Our goal is to get back to a higher run rate. Clearly, we want to go to the tourist side as opposed to Singaporeans gambling. I think it's starting to pay off. We hit a decent number for the quarter. We think there's growth opportunity. Our goal is to build a big sales team, which is not focused on the rolling direct but rather premium customers. That's definitely the direction. Uh-oh. I think we lost the call.
That was Steve.
The next question will come from Robin Farley with UBS.
Thanks. Yeah. Can you quantify the Venetian, that with the Paiza renovations, what percent of your VIP tables were out of service in Q1 and maybe also in Q2, just to get a sense of that? Is that what you attribute the slots declines at Venetian as well? Do you think that was tied into the Paiza renovations?
Dr. Robin, could you repeat the second part that we lost, the second part of that question?
Sure. Do you think it was the disruption from the Paiza renovations that also impacted things on the slot side at the Venetian as well, the declines there?
Obviously, any time you have renovations, it doesn't help. I still think when The Venetian Macao, for the quarter, we still did $320 win per unit per day, which I think is acceptable from our perspective. We were at $357 the previous quarter, but we held a bit lighter. We're pleased overall where the slots are at and ETGs and our entire mass table mix as well. We're happy with that. As far as VIP tables, obviously we traded down a bit there in the volume. Due to disruption in terms of the renovation, it's to some extent, yes. Still, $38,000 win per table per day, we're happy with that. Very happy with our normalized profit, which was very strong. Again, overall take on The Venetian is any time you have renovation, there's some disruption in visitation.
Overall, we just think The Venetian, again, VIP tables, the rolling volume was excellent. I mean, at $38,000 win per day, our mass tables incredibly strong with a lot of tables on the floor. The land is very good. I think we're very pleased with The Venetian's heading. I think The Venetian's a $4 billion, $5 billion property where it's going. Yes, some disruption, but overall, not material.
Okay, great. I don't think you guys have commented about the auditor change that was announced. I wonder if you could just give any color on how quickly you think you'll have on board as a new auditor.
Yeah, it's Ken. There's really not much to talk about there. It's pretty straightforward. As we talked about before, no disagreements, no reportable events. It's behind us, and we're very engaged in the process of selecting a new firm. I would think within the next 30 days or so, we should be able to announce a new firm.
I'm sorry, you said in the next 30 days?
Approximately.
Okay, great. Just lastly, is this the first write-offs that you had in Singapore? I don't recall a previous one. Just a little color on that.
Yes.
Okay. Any color around that or?
No. Yeah, I think as we go through the typical aging and the collection process, we get to the point where some of them are uncollectible, either as a bankruptcy situations or players being deceased and such. When we get to the end of the road where there's actually no possibility of pursuit of collection for those reasons, we end up just writing off the balance.
was this sort of cumulative, or was it primarily just driven by one write-off?
No. We go through all of the accounts, it wouldn't have been one. It would've just been those that had gotten to that point where we felt that there was actually no possibility, we just charged that amount against the reserve.
It's pretty typical in any market, same in Las Vegas, same in Macao. At some point, people pass away or bankrupt, and they're not going to pay you. We write that off, and I don't think it's atypical. As Singapore matures, you're going to have more of this.
For those who are following along, this is on page 28 of the deck that's on our website, and the number is $11 million that was written off.
Right. No, that's the $11 million I was asking about. Okay.
That's it.
Thank you.
Ladies and gentlemen, we've reached the end of the allotted time for the Q&A portion of today's call. Thank you for your participation. You may now disconnect.