Good afternoon. My name is Janica, and I will be your conference operator today. At this time, I would like to welcome everyone to the Las Vegas Sands Corp. Q1 Earnings Conference Call. All lines have been placed on mute to prevent any background noise.
After the speakers' remarks, there will be a question and answer session. Thank you. I would now like to turn the call over to Mr. Daniel Briggs, Vice President of Investor Relations. Please go ahead, sir.
Thank you, operator, and good afternoon, everyone. Thank you for joining us today on the call. With me today are Mr. Sheldon G. Adelson, our Chairman and Chief Executive Officer Mike Levins, our President and Chief Operating Officer Rob Goldstein, Executive Vice President and President of Venetian at Palazzo in Las Vegas Ken Kaye, our Chief Financial Officer and Gail Hyman, our General Counsel.
Before we begin, let me remind you that today's conference call will contain forward looking statements that we are making under the Safe Harbor provisions of federal securities laws. The company's actual results could differ materially from the anticipated results in those forward looking statements. Please see today's press release under the caption Forward Looking Statements for a discussion of risks that may affect our results. In addition, we may discuss adjusted net income, adjusted diluted EPS and adjusted property EBITDA, which are non GAAP measures. A definition and a reconciliation of each of these measures to the most comparable GAAP financial measures are included in the press release.
Please note that the presentation is being recorded. With that, I'll turn the call over to Mr. Adelson.
Thanks, Dan. Good afternoon and thank you all for joining us today. I'll begin the call today with some big picture thoughts on this quarter's results and the preview opening at Marina Bay Sands in Singapore. I'll then hand the call over to Mike and the team to provide some additional detail. Big picture, we are quite pleased with our results.
Our business is doing very well at the moment. Each of our properties is growing revenue, operating efficiently and expanding EBITDA margins. The strength of our business model in our quarterly results. We again generated record revenues and EBITDA in the quarter and continue to lead the mass market in EBITDA generation. While total net revenue at our 3 properties in Macao increased 24% compared to last year's Q1, Adjusted property EBITDA increased 47% across our portfolios of properties in Macau.
It just validates what we've been saying that somebody once told me, you can't put revenue in the bank, only EBITDA goes in the bank. At the Venetian Macau, EBITDA for the quarter was $170,000,000 an increase of 40% compared to last year's Q1. EBITDA margin increased to a quarterly record 30.9%. That financial performance reflects strong revenue growth coupled with our continued focus on efficiency throughout our operations. The results of the Sands Macau and Four Seasons Hotel Macau and Plaza Casino also reflect these trends.
Revenue was up 26% at Sands Macau for the quarter, while EBITDA was up 38%. At the Four Seasons Hotel McConnell and Plaza Casino, revenues were up 118% for the quarter, while EBITDA was up 3 43%. Focus on highly profitable mass gaming, hotel and retail businesses, together with our attention to cost structure and efficiency, has allowed us to bring revenue dollars through to the EBITDA line. We will recommence construction shortly on Parcels 56, which is our largest Cotai Strip development to date. We believe the 13,300,000 Square Foot Integrated Resort Complex, with its array of world class attractions and amenities will broaden the appeal of Macau as an international tourism destination.
Importantly, the development will more than double the hotel inventory on the Cotai Strip. That hotel inventory is critical to increasing the competitiveness of Macau as an internationalized destination and enhancing retail growth. I might say that I believe there are several 1,000 employees already on the site that are doing some remediation work and that are may have already started some of the minor reconstruction works. Let me spend a moment on Las Vegas. Revenues increased modestly this quarter compared to the quarter 1 year ago, due principally to record volumes in the gaming portion of our business.
Group business is also returning, although pricing remains competitive. Forward bookings are increasing for both 2010 2011, which is encouraging. We are also seeing stronger pricing trends in the FIT portion of our business, particularly on weekends. Finally, let me touch on the newest and most exciting property in our portfolio, Marina Bay Sands in Singapore. After years of hard work and preparation, we opened the doors of Marina Base Sands on April 26, just 10 days ago.
While it remains early days, the initial results are extremely promising. Visitation and gaming play levels have been robust. We hosted our 1st group meeting earlier this week and we'll host our 2nd major group next week. Forward booking prints, which were already quite healthy, have increased markedly since we opened our doors. Let me provide a few early observations on Marina Bay Sands that we've learned since we opened.
One, we have a substantially different customer profile than our competitor, which should lead to a higher revenue per visitor. 2, our departmental profit from gaming has ranged between 45% 60% depending on the volume of play per day. This is what we have been saying for quite some time and others have not been others haven't agreed with it. 3, Direct VIP play has been robust to date with over 4 50 credit applications completed in the 1st week. Customers have come principally from Malaysia, Indonesia and Singapore, which we've always maintained has been our primary market, with additional customers from Taiwan, Mainland China, Hong Kong, the Middle East and India.
4, both our premium direct and slot play have been quite robust and have exceeded our expectations. 5, to date visitation has been mostly from overseas visitors with a smaller component, much smaller component coming from Singapore Airlines. 6, we are learning rapidly about our customer taste and we have significant opportunities to reconfigure our gaming floor as well as minimum wages and game mix to deliver the most popular games based on customer demand in the future. Particularly on the ETG, the electronic cable game side. We believe that can somewhat increase our average win per unit per day on the slots.
We are confident about the property's potential to generate both significant growth and strong returns for the company. While increasing visitation to Singapore and enhancing its reputation as the leading international business and tourism destination. We look forward to formally celebrating the debut of Marina Bay Sands with the people of Singapore and a grand opening celebration on June 23. I look forward to addressing your questions later, but we'll turn it over to the team for a quick update for us. Mike, go on.
Thank you, Sheldon. I'll add just a couple of thoughts. We've worked hard to instill a culture of cost discipline across the company and expect that focus to be an ongoing component of our future success. Now, our principal focus has turned to opportunities for growth, which we believe to be significant. In Macao, we have outstanding organic growth opportunities in the gaming, hotel, MICE and retail areas.
We will also significantly expand our asset base in Macau with the debut of Parcels 56 on the Cotai Strip. In Las Vegas, a recovery of consumer spending and an eventual recovery in room rates will occur over time. At Sands Bethlehem, the addition of table games this summer and our 300 room hotel in the spring of 2011, as well as the expansion and maturation of our regional marketing programs will benefit that property. And of course, Marina Bay Sands should provide substantial growth in the coming quarters. The Venetian Macau remains the market leader in mass play in Macau, delivering non rolling drop of $922,000,000 and record slot handle of $670,000,000 for the quarter.
The trend of high hold at the Venetian Macau on non rolling play continued last quarter and also occurred in April. We believe these higher hold rates at the Venetian Macau are non rolling play, which are impacted by many factors including the length of play, the customer profile and the mix of games on the Venetian floor should continue in the foreseeable future. Our contribution to EBITDA at the Venetian Macau continues to reflect our strategy. For every dollar of EBITDA generated at the property during the quarter, nearly 60% was produced by less volatile, higher margin mass gaming and slot play. Over 25% was generated from non gaming areas, including our hotel, convention, banquet and retail operations and less than 15% was contributed by the more variable lower margin VIP Rolling Place segment.
We remain focused on developing and growing our premium direct business, which is the higher margin segment of VIP play. Our direct VIP play at the Venetian Macau grew to $2,100,000,000 or approximately 21% of the more than $10,000,000,000 of rolling volume during the quarter. At the Four Seasons Hotel Macau and Plaza Casino, total rolling volume was $3,700,000,000 with direct VIP rolling business growing to $1,600,000,000 or 43% of that total.
Looking ahead,
we remain confident that the development of additional destinations on the Cotai Strip will expand the market, driving greater mass play hotel and retail revenues to our current and future properties. Let me spend a moment on the Sands Macau. The Sands remains both a cash cow and a market leader in mass play on the Macau Peninsula. EBITDA increased 38%, to $70,000,000 for the quarter. EBITDA margin improved to 24.6% this quarter compared to 22.4% in last year's Q1.
So that covers Macau. Let me spend a minute on Sands Bethlehem before Rob covers Las Vegas. I'm pleased to share that Sands Bethlehem had its best quarter since we opened the property last summer, generating $11,000,000 of EBITDA. The improving results reflect stronger slot revenues, the introduction of additional marketing programs and in concert with our inefficiency effort that was just completed. We continue to believe Sands Bethlehem has potential.
We plan to add 89 table games this summer, which should increase the property's appeal and should contribute to greater profitability at the property overall. We have also restarted the construction of our 300 room hotel, which is expected to open in the spring of 2011. The addition of the hotel will increase the length of stay at Sands Bethlehem, while adding higher margin hotel revenues to the property's financial results. With that, let's go to Rob in Las Vegas. Thanks, Mike.
Our Las Vegas properties delivered EBITDA of $105,000,000 in the Q1 of 2010 compared to $90,000,000 in the Q1 of last year. The gaming segments of our business remains strong. Hotel occupancy also remains healthy. The challenge continues to be room rates, which remain weaker compared to historical levels, although FIT rates have shown improvement, particularly on weekends. Food and beverage business also down compared to levels we enjoyed in the past.
Table gain drop was a record $547,000,000 during the quarter, a 23% increase in the Q1 of 2,009, while slot room was $49,000,000 during the quarter, about the same as it was in the 2,009 Q1. Looking forward, we expect to realize more group rooms in 2010 than realize in 2,009. The pace of group business bookings continues to improve, 2011 should be stronger than 2010. In 2009, we realized approximately 470,000 group room nights or about 18% of our total room nights. Today, we have about 515,000 group rooms on the books for 2010.
We expect our actual group rooms to see that number as we add additional business throughout the remainder of the year. We do expect the pricing will improve over time as business expands, our competitors in Las Vegas are able to raise prices and the economic recovery continues. So in summary, our gaming business is healthy with record volumes in our most recent quarter, while our costs are down. Given that backdrop, we are confident that Las Vegas properties will continue to exhibit significant operating leverage as pricing FID and group segments improves. And with that, I'll turn the call over to Ken.
Thanks, Rob. We made steady progress this quarter on our deleveraging strategy. Excluding our development financing in Singapore, we paid down or retired approximately $850,000,000 of our debt during the quarter. Those repayments include the total outstanding balance of $776,000,000 on the revolving portion of our domestic credit facility. The repayments also include the purchase and retirement of approximately $35,000,000 of face value of our senior notes, which were purchased at a discount.
These repayments will reduce our cash interest expense by more than $25,000,000 per year in the future. As of March 31, we had in excess of $4,200,000,000 of cash, cash equivalents and short term investments on our balance sheet. That cash provides us with significant financial flexibility and will enable us to execute additional components of our deleveraging strategy in the future. In addition to our cash balances at March 31, we have approximately $1,300,000,000 of availability under our undrawn credit facilities at current exchange rates, including amounts available through our U. S.
Credit facility and our Singapore credit facility. So together, we have approximately $5,500,000,000 of cash, cash equivalents and short term investments and available sources of liquidity. The principal uses for that $5,500,000,000 includes approximately $1,400,000,000 of capital expenditures, pre opening, FF and E and construction period interest to spend on our Marina Bay Sands development in Singapore through the end of calendar 2010. Although we expect as much as $400,000,000 of that amount to be paid out of cash flow generated by Marina Bay Sands during the year. An additional $400,000,000 principally retainage payments on the development will be paid out of cash flow from the completed property in 2011.
Approximately $400,000,000 in additional equity contributions will be made towards the development of Parcels 56 on the Cotai Strip in Macau. In addition, we expect to close later this month the previously announced $1,750,000,000 credit facility to fund construction of Parcels 56 in Macau. The $400,000,000 in equity and the project financing together are sufficient to complete the first two phases of that development, which will feature approximately 6,000 hotel rooms and all of the major cash flow generating components of the development. As of March 31, total debt was $10,500,000,000 while our cost of borrowing remains low. Our weighted average interest rate for the quarter was approximately 3.5%.
At our current levels of operating performance, our cash balances provide ample cushion for compliance with the financial covenants in our domestic credit facility. At March 31, 2010, for the U. S. Restricted group covenant compliance purposes, our trailing 12 month EBITDA was $439,000,000 our total gross domestic debt was $4,300,000,000 our cash balances within the U. S.
Restricted group were $2,000,000,000 and our calculated net debt was $2,400,000,000 Our leverage ratio was 5.4 times compared to a maximum leverage covenant under our U. S. Credit facility of 6 times. For the Venetian Macau Restricted Group at March 31, 2010, our trailing 12 month EBITDA for compliance purposes was $1,000,000,000 total gross debt at the Venetian Macau Restricted Group was $2,600,000,000 and our leverage ratio was 2.6 times compared to a maximum leverage covenant of 4 tons. We remain focused on maximizing operating profitability to enable debt reduction.
While our business will naturally generate a significant amount of free cash flow that will enable deleveraging in the future, we also expect to execute in due course the sale of non core assets, which will enable additional debt repayments and enhance returns. Before I turn the call over to Sheldon for concluding comments, let me highlight 2 changes we are making this quarter with respect to our expectations for table games hold. For rolling play, we are establishing a range of 2.7% to 3% across our portfolio properties, which is consistent with the actual hold rates we have experienced over the last few years. For non rolling play, our range of expectation for hold rates has historically been 18% to 20% in Macau and 20% to 22% in Las Vegas. We do not believe these ranges accurately reflect our evolving non rolling table games business in either Las Vegas or Macau.
Our non rolling table games hold rates in both Las Vegas and Macau are impacted by many factors, including the length of play, the customer profile, the mix of games and seasonality. These factors vary widely across our portfolio properties and are constantly changing. Given that backdrop and our belief that a one size fits all hold expectation cannot accurately capture these factors across our portfolio properties, we have chosen to move to a property specific 4 quarter moving average methodology for non rolling table games hold expectation. We believe this methodology is a reasonable one that will allow each property's expected hold percentage to reflect that property's unique characteristics and expected hold performance as determined by actual historical experience. And with that, I'll turn the call back over to Sheldon.
Thanks, Ken. First thing I want to say is that I made an error before. It was a typo in our draft. I said that we opened on April 26. We actually opened on April 27.
I should have known I was there. Before we go to Q and A, let me make a couple of final points. We worked very aggressively last year to right size our cost structure and to clean up our balance sheet. I know we've made a lot of that in several prior conference calls. I'm very happy to say that that's been substantially completed.
The results of those efforts are now clear. We just completed another outstanding quarter generating record revenues and EBITDA. We have significantly reduced our debt levels and our balance sheet now has more than $4,200,000,000 of cash, providing significant financial flexibility and enabling us to continue our industry leading growth strategy. We stand today at the beginning of our next major phase of growth. With that, we'll move to your questions.
Your first question comes from Joe Greff.
Good afternoon, everyone.
Hey, Joe. Good afternoon, Joe.
I was hoping you can give us an update on any conversations or the many conversations I'm sure you've had with Macau and or Beijing with respect to the table game cap for new development in Macau. I think Ken you phrased when you're talking about sites 56 as having 6,000 rooms and all the cash flow generating amenities. Can you comment on how many table games you are allowed right now to have there or what you're anticipating to end up there? And whether that would involve table games being brought over from some of your existing properties, whether it's the Four Seasons or Venetian Macau? Thank you.
Joe, this is Mike. We met last week with members of the Macau government. We've been assured in writing for 400 tables to start with and their assurances of reviewing tables as we go over the next couple of years. Our expectation and our lenders know that we will open with enough tables in 56 to justify the numbers that we projected in the loan documents. That will involve moving some tables from some of our facilities as well as the additions of some electronic games.
Okay. Just to clarify that
the $400,000,000 that you've been assured of in writing, that is inclusive of table games that you would move from other properties?
No. 400 new tables plus 2,200 slots. We have assurances from the government and we've received that assurance and the assurance that they will work with us to get additional tables by the latest in March of 2013. But if that doesn't happen, we will still open. We will move some tables that we're not using in the other facilities as well as add electronic games.
So the numbers that we projected are the numbers that are in the loan documents and have been approved by the banks.
Mike, I'd like to add on to that and say, I believe the number is approximately 170 tables that we're going to move that either are not being used right now or that are these are the marginal games that are being used at low rates. We're adding 100 electronic cable games, which offer some very good potential. We're going to try different electronic cable games. We're also assured by the government, we've been assured that we'll have the 270 extra games that we originally put in our plans in 2013. So we'll operate for 2 or 3 years without we'll still operate with that number of tables, but we'll be able to get another 270.
That is before we start to make adjustments like we're making in Singapore, we make with all new properties, increasing or decreasing the number of tables and denominations as we open the property and we see the demographics of the visitation.
Great. Thank you. And then with respect to Marina Bay Sands, Sheldon, I was hoping you can share with us, I know it's been only 10 days, any kind of revenue metrics at the property, whether it's 1 per slot per day or slot revenue per day or mass revenue per day, it'd be nice sharing what those numbers are relative to other numbers that we might be hearing from your competitors?
Well, Well, let's put it this way. None of the analysts have come up. First of all, we don't have one thing we showed up that takes a long time to order, stadium style electronic cable games that seem to have gone gangbusters in Kenting's results world at Sentosa. I call it Kenting, other people call it AWS. They've been gone they're completely full and we've ordered them and these are these sort of have to be made custom, but we expect them in 4 to 6 weeks.
So that will make a big difference. However, the lowest number per day that we've experienced is higher than the maximum number that any of the many analysts have been estimating. The estimates that we've seen in the market are similar to Las Vegas numbers, dollars 200 plus or some other numbers around the country. But we have ranged, it depends upon the day and depends upon which machines have been opened because in the first few days, the what do you call them, surveillance requirements are really, really very, very particular, very meticulous, very perfectionist. But we've run, I'll give you a range from $400 to $900 per unit per day.
And I don't think any one analyst came up with our lowest number of 400. So I think we'll have a somewhat higher average while we're bringing those electronic table roulette games. It's obvious that the roulette games, we get 8 turns an hour, 8 to 10 turns an hour out of the roulette games, the live roulette games. And the ETG, the electronic table games, who are let are 80 games an hour. And they're just they're unbelievable cash cows.
Great. Thank you, Sheldon. Rob, I almost didn't recognize you actually not sounding so negative on Las Vegas.
Thanks, Joe.
Your comments about the FIT rates on the weekends, can you explain why you think that is? Is that just demand coming back and therefore you and others on the strip are yield managing appropriately? Or is it just a rationalization of how the operators are looking at charging room rates?
Before you answer, Joe, I just want to say, we are only completely agree with you. We don't know if we're talking to Rob Goldstein the new or Rob Goldstein the old. Well, to be clear, Joe. His birthday is tomorrow? My birthday is Sunday.
Sunday. Yes. So he's the older long term goal statement.
I'm getting old and pessimistic. Now there's been
a nice No, I'm domestic.
There's a nice movement, Joe, in the weekend. Let's be clear, though, it's not across the board. It's in especially in the FIT Leisure segment. I showed some relative strength in the last month. April is very, very good for the entire industry.
I think that May is holding up that trend. And I don't know how to attribute it to what, but I think some confidence building among our competitors and certainly in this hotel that we're seeing weakened rates from leisure side trading up. It's been very it's nice to see. Group demand, as we said in previous calls, continues to be strong. Unfortunately, pricing doesn't seem to accompany that demand.
So I'd love to see our group business get back up in the higher ranges. But what is happening clearly last weekend, we could all of April was very, very encouraging on the weekends and in the leisure segment. And I'm hoping it bodes well for the summer because you know a lot of folks in town are very concerned this summer and they should have been. But is it the last 4 to 6 weeks a nice trend upward?
Can we say the number? I think we've been averaging on weekends between 2.40 and 2.60. True.
Last week in 2.62. We had nice and lots of it just looked good. It's been a recent trend though, Joe. I think you saw the engine numbers this morning and I think what's happening in town in the Q1 was not that strong. And I think we got ways to go in a lot of studies, but I'm a little more optimistic than it has been in the last 6 months, but I do see some leisure positive leisure trends and clearly demand on the group side is very strong, but the rates haven't been as strong.
Great. Thanks guys.
You're talking about tables, could you Joe?
I'll let the next guy ask about that. Thanks.
Your next question comes from Janet Roussier. I wanted to ask you about lots 56 in Macau. We've heard stories of labor rallies against foreign labor and potential requirements that you have one local worker for every non local worker and cost escalations due to labor shortage. And you have a few 1,000 people on-site now, but typically would have more like 10,000 to get a project of this size done. What are you hearing from the government about your ability to bring in more workers?
And what does that mean for your timetable and your cost projections?
Janet, this is Mike. At a meeting last Friday in Macau, we had a very good meeting. And the indications we got were that there is some levels of low it's a very low level of unemployment in Macau. We actually have about, I think, 3,900 workers on the site now. And the indications we got as we left the meeting is that we shouldn't be worrying about whether or not we'd be able to have the blue cards for workers, but we have to absorb some of those non employed workers in Macau, which we're willing to do.
And we don't expect either us and I can't speak for Galaxy who is going to have the same situation about having a problem there. We feel very confident we'll have the workers to finish the project.
Will you have them on a quick timing? So if you do what your part is, which is absorbing the nonemployed workers, is that a process you can work through quickly so that you can get your blue cards expeditiously?
Yes. We believe so, Janet. I think that it's in the interest of Macau and the government and the citizens there that we'd be successful and get done. And at this point, there will be some time that we have to execute certain construction contracts, which will probably last 3 or 4 months before we get fully operational. There are workers available outside of Macau obviously for that.
And at this point, candidly, we don't expect to have a problem. We will go through The biggest surprise in Singapore?
Yes.
You're talking about the biggest surprise in the 1st week of opening?
Yes.
Oh, boy.
It's kind of a tough question. I think that I'd have to say from a casino standpoint, I think the biggest surprise is the VIP premium the direct premium business, the credit business, the amount of credit applications and the activity in our casino results, which indicate roughly around 50% coming from that particular segment right off the bat. I think that was a big surprise to me. I think the other surprise was that how well the casino was accepted in the community in terms of its positioning visavis the competitor. All the press and all the support kind of lifted it to a different level.
And in the mass play, the non slot mass play was surprisingly good. I thought the slot play would be what it is, but I didn't know that the mass play would hold on the tables. The way we set the floor up, we set it up so that we would have enough tables to accommodate everybody who came. So at some points, they were empty tables or very slow play at some tables, but there were no lines, no pushing, no shoving, no crowd that occurred in the other environment and that was intentionally done. So I was surprised how well that worked.
We had no lines, no difficulties, etcetera. On the negative side, I think we were surprised at how much surveillance activity we had to do in the last minute to get tables open. The amount cameras kept being added. And so as a consequence, we didn't open some of the VIP rooms, only got about half of our tables opened in the Peizer area and that was a little bit of a surprise. We thought we were okay that way, but in the last couple of weeks, it's kind of went away from us.
I think for the resort that is basically even though 50% of the GFA space is open, only really about 20% to 25% to 30% of the total resort is open. And I think we're surprised at how well it was accepted by the community.
You said that, the local crowd was less than, was a low percentage. Was it can you give us some idea of how low and was it lower than you
expected? 1 third, 2 thirds approximately.
The first number of days in the casino, you had foreigners about 66 percent and about 33 percent Singaporean.
For a
couple of days, it was even fifty-fifty, but most if you looked at the whole over the course of 8 days, it's up there. Many more foreigners, Malaysia, Indonesia and foreigners from Singapore primary markets, which we expected and the Singapore market about 1 third to 40% maybe at the most of Singaporeans.
There's 36,000 other rooms, this is Sheldon, in Singapore. And they enjoy very high occupancy rate in the 80s typically, mid to high 80s. And there's a lot of opportunity for foreigners to come that visitation to the other hotels. We're just going to try to set up shuttle buses between some of the bigger hotels if they will allow us to do it. There's good news and bad news on the opening day.
The good news is we had an awful lot of people. The good news well, I shouldn't say good news or bad news. The good news is the second part of the good news is that people looked at it and said, well, there weren't a lot of crowds, there weren't long lines that there was at Genting, blah, blah, blah, did they have a lot of people? Well, Genting didn't have a huge 1.25 square foot convention center to warehouse the people in. So what we did is set up chairs.
They didn't have any air conditioned space to put them in. So we turned the air on in the convention center. We put in thousands of chairs. We put in food service. We put in counters where they could pay the Singaporeans could pay the $100 entry fee.
Well, the real bad news was that we weren't allowed to advertise that we're going to be open. But people just knew when the rumor had gotten around that we're going to open on the 20 7th. And we didn't we weren't able to advertise until 27th until most people already went to work. So then we let the people in on an orderly basis, straight line with stantions and ropes and very orderly. So we have thousands of people waiting.
But I guess the journalists didn't know that they were in there. They were just shooting pictures of the people that were on a very orderly basis coming into the casino from the convention center.
We should add, I think all of us were there. The one thing that the building we should say it's a stunning building, iconic, it's beautiful. And I think everyone who entered the opening was very, very impressed both for us and those of the team is an amazing iconic building and something that everyone in that region has to see.
Thank you. Your next question comes from Mark Strong.
Good afternoon, guys. I have two quick questions. Hey, Mark. Hi, Dan. First question on Singapore.
I know it's early, but given the strength in the slot market that you're seeing so far, do you guys have any thoughts on reconfiguring the floor, maybe including more slots and pulling tables? And if you were to do so, would there be any labor or CRA issues in doing so? And then I have a quick follow-up on Macao.
Mark, let me just give you this answer. We're in there 8 days. And although there is some sense of urgency to get the stadium electronic slots in, at this point, it's really too early to tell what the movements will be. We know we have to make some changes in the floor, but it's going to take another week or 2 before we find some really pretty I'm on my way there next week also. So it's going to take a little while to get exactly the right mix of business and that's going to be ever changing.
But so the only really sure thing now is we have ordered the electronic stadium seating games and our mix of baccarat to other tables is being looked at very carefully. The size of the casino, A lot of the traffic is coming into the sides and not moving towards the middle. And so there's a number of things we're looking at, which you find as you go. So the answer to your question is yes, there will be movement, there will be changes. And on the other side, on the labor side with the CRA, it's a pretty free environment for us to do what we want to do as long as the surveillance requirements are taken care of.
But from a table side standpoint, it doesn't really they won't affect us in terms of staffing.
Okay. Thank you. Then on Macau, just looking at the mass performance, while it's certainly impressive if you look at it sequentially, volumes have been relatively flat. Do you guys have plans in place whether marketing or otherwise to try to stimulate volumes somewhat in the market?
A lot of the emphasis in Macau by the individuals in charge now has been on trying to build the VIP direct market with our own credit. We're doing a lot of that. It's growing as I mentioned in the call. I think it was 21% of our business in the quarter. That will help us.
But with that strategy as well as our strategy in terms of MICE business and the tour and travel business that we've been working on and getting good results on, that doesn't build the same kind of revenue as you know of the junket rolling revenue. That sort of dominates the revenue perspective of Macao. So I can't tell you that our revenue will have sequentially the amount of growth, but I feel very confident that our EBITDA will continue to grow exponentially as we produce that kind of business. So we have no real plans to build our junket level traffic as we've held to the 1.25 also we've bought potentially loss have been impacted by some of the Peninsula properties that give better rates. So we're taking another approach to it.
I don't know if that answers your question, but
Yes, that's helpful. One quick follow-up. Have you seen any impact from has City of Dreams across the street been any more promotional? And have you felt the need to match that at all? Or has that not been necessary at this point?
To our knowledge here, we haven't matched it. I have not heard anything from Steve Jacobs and the people over there that City of Dreams has been changing their 1.25 rate. The changes that I hear you talk about on the mass market?
Yes, more on the mass side.
Well, they've done some things on mass. They've done some promotion and some advertising. We are doing some things in other areas now promoting business. We've been pretty successful at it so far. But you don't really see that unless you actually look at in our ability particularly in The Venetian and the Four Seasons of how many rooms are being sold every night to the non VIP, the non junk at play.
And we're selling about at least 2 thirds of our rooms or more at The Venetian on a paid customer basis now.
Okay. Thank you very much.
That's a big indicator if you I don't know what City of Dreams is doing, but my guess is it's not nearly as much as that.
Okay. Thank you.
Your next question comes from Shaun Kelley.
Great. Thanks guys. Just wondering going back to Singapore for a second, if we get a little bit more color on the VIP versus mass mix. I think you talked you had mentioned just briefly that about 50% of the business was coming from VIP. Is that correct?
That is correct. I think the actual number for 8 days is 48% of the revenue from VIP.
Got it. And just kind of where are you at right now in terms of kind of the tables that are kind of up and running given the surveillance issues? How many VIP and mass market tables are you at and kind of where are you headed over the next?
We're at 70 VIP, 442 Out of 139. Out of 139. We're 442 out of 559 and we're 14 50 slots out of 16 42 slots.
Got it. And then, Mike, we've talked before a little bit about the commission and rebate structure. Obviously, you're not using junkets today. Kind of is that right now in line with your expectation? How should we think about kind of the rebates that are being demanded in the market right now?
Rob can speak to that I think. But let me just say that we've always said and continue to say on the junkets side that if there are junkets that are licensed by Singapore, we will do business with them. We don't expect that to be many, but there will be a few. On the commission rate side, we basically our strategy on the commission rate side on the private or the VIP private play, we positioned ourselves much below the competitor in Singapore. So and the rates we have not had pressure to move those rates so far.
And the reason for doing that was that we thought that we would impact the RWS's VIP business. And if we competed dollar for dollar on the commission rate and they lost the business to us, so they'd start moving the commission rate up again. So we positioned ourselves lower on the commission rate. And I can't tell you what the average is because I haven't really looked at it in the 8 days, but it is below what the competitor has published as their commission rates. And so far, we're not budging on it because we're doing okay.
That the this is Sheldon. The ramp up of the high end is going well, but it is ramping up. There are we're getting customers from places that we didn't consider in our priority countries. We look at the breakdown of the apps for the credit, and we find it coming from the main three areas, Singapore, Malaysia and Indonesia. And there are lots of very high rulers, substantially higher, at least the numbers I've seen, substantially higher than we've experienced here in Las Vegas.
We don't get a lot of $10,000,000 $12,000,000 credit players here, although we do get some. But there's a lot there's more than what I expected. So we're still ramping up, particularly the first night that we opened. We had some surveillance table issues and we couldn't open all the tables. I'd like to point out something that nobody has really asked.
Our gaming table win per unit is very encouraging. It's difficult to for me to give you the exact numbers, but let's put it this way. When I did some estimates of what we would do and I screened them extensively. The number that I came up with now I've adjusted based upon the tables that are not open because for various reasons, mostly surveillance. The numbers coming in at higher than what I originally estimated to come up with our overall EBITDA number.
So we're very encouraged about the high end. I think a good part of that relates to the fact that we have a higher quality visitor compared to Genting. People say they have a lot of the construction workers. I personally wasn't able to get there for the few days I was there, but everybody else has been there. And so the word that comes to me is they have domestics, domestic health and construction workers, a lot of Bangladeshis.
And we seem to have well, just eyeballing it myself, we seem to have a higher quality person, mostly would appear to be middle class, lower to upper middle class people.
And just one last one on that number, Sheldon. Just to be clear, you're talking about the kind of $1,000,000,000 to $1,250,000,000 estimate that's been put out in the market previously?
We haven't given any guidance. We have debated. We have debated. We said we came up with certain figures that were not our technology, we're not just to build it, and nobody got there. But we're looking at numbers and metrics that are on a ramp and that seem to go very well.
We can estimate we believe that the final numbers after the ramp up period and on a 12 month basis will be a heck of a lot closer, if not equal to or maybe even exceeding our number that we expected, then the average of the consensus of all the analysts together at a substantially lower number. I mean, most of the analysts are estimating, say, slots as an example, at the normal U. S. Type of slot numbers. But the slot numbers, the 200 range.
Slot numbers over there, I'm sure you heard about Kenting and our slot numbers. I told you what they were on different days. And we still don't we haven't maximized the most desirable games. We have to do the fine tuning of the table of the both the table games and denominations and the slots and denomination. By the way, the electronic table games over there are considered slots, slot units, which will go up to 2,500.
And we believe that the slot return is so good and so promising for the future that we're going to we're seriously considering putting in as many as the maximum that we can in the near future, 2,500.
Got it. Thanks, everyone. Thanks, Sean.
You're welcome.
Your next question comes from Robin Farley. Great. Thanks. I wonder if you could help us quantify a little bit the impact of luck in the quarter. And I know that you said your ranges for normal hold are going to change.
But based on the ranges that you talked about before the quarter, if you could help us kind of quantify because some of the factors aren't in the release that was impacted like what whether the play came in under what kind of arrangement. So if you could help us quantify that for both Vegas and Macau. And then also a question on Singapore. In terms of the sort of the stickiness of that local play, are most of the local visitors paying the one time fee? Or are you getting some signing up for the annual membership?
Just trying to think about how long term or how sticky that local visitation is?
Well, actually, I don't think we have that information. We're focusing on other stuff. Does anybody have that information, Ken?
While we're searching information, I'll just answer the Vegas hold issue. I think our number is dead all and should be because our mix. Obviously, we handle about $547,000,000 in Las Vegas. About 50% of the drop came out of our Asian baccarat Chinese New Year's week, couple of weeks. And so we didn't play lucky, we play what we should play, which is we held very well.
Our historical is in the high 20s. We actually held in the low 30s. But balancing that, the other half of the drop came out of our non baccarat, more typically U. S. Customer, we held very poorly, about 13%.
We blended at the rate you see on the staff, we blended 23.4%. But if you look at I don't think we held high at all. In fact, I think we held about dead on where we should be because the baccarat business for the 10 years we've been doing this, we held 28%, 29% against 1,000,000,000 of dollars of drop. I think it's reflective of the baccarat market and the Asian play was disappointing to me was we held 5 points under the norm on the balance of the drop. So I don't think in Las Vegas, results because of the mix would be considered 23.4 because they're high.
In fact, I think it's right where it should be. Perhaps you can talk about Macallan.
We have tried to skirt this issue. We try to find a way to neutralize it or level it out on the hold. So I came up with the idea that we should take a 200 day, 100, 200 day or 2 or 4 quarter moving average. So we put together some of the figures and the moving average say on the roll in do you have the figures in front of you, Ken? The moving average on the roll, I believe, was exactly 2.84% over 4 quarters, 2.84%.
You can't get any more accurate than that. We could have come 1 basis point higher at 2.85, but I think 2.84 is a very good moving average. You got to remember, so every time we come in with a low number, nobody wants to adjust it upwards because we had a lower than normal number. So and everybody wants to reduce our performance down when we come with a high number. So I think the average number should be what it should be what the average is.
Over the longer the period, the greater the larva averages assuredly kicks in. Ken, do you want to make some comment about that?
Yes. Well, I mean, in breaking it out between kind of the rolling and the non rolling, on the rolling side, Sheldon is exactly right in terms of the average, which is the 2.84, 2.85. If you look at kind of the actual numbers for the Q1, we were unlucky, if you will, by about $5,000,000 on the roll. And it's a little complicated because you have to look at it on the volume based and wind based and the volume base was a little more from an overall kind of revenue perspective and we were unlucky if you will from that standpoint and a little bit lucky on the wind side. So when you kind of marry the 2 together because the volume base is with a higher percentage of the overall kind of revenue stream, our net hold impact was an unfavorable 5.
So you basically have to add about $5,000,000 to our performance for that. On the non rolling side, if you compare it to the moving averages, we were a little bit favorable from that perspective. But nonetheless, you have to look at it from the standpoint of we think that the actual performance that we achieved in the Q1 kind of consistent with where the business has been performing over the last four quarters and falling within that range. So if you consider that our actual Q1 of 2010 performance was within the range of performance that we've seen in the non rolling business for each one of the properties, in essence there'd be no adjustment for the non rolling business. Now, if you compare it to just a single data point, which would be the moving average, then we would have been favorable by approximately around $10,000,000 or so.
So when you marry the 2 together, meaning the rolling and the non rolling, we are favorable in total by about $5,000,000
Okay, great. And that was helpful. Thanks. And then just last question. Can you break out what your casino receivables are for both regions?
Okay. Receivables.
Yes, just one second. Well, our casino receivables for Las Vegas, on a net basis, it's about $118,000,000 and for Macau, it's one second, it's about $190,000,000
And do you I don't know if you have in front of you what percent reserve that is?
Yes. So in Vegas, we're about 31% reserved. And you have to look at it between kind of the breakout between junkets and non junkets, overall it's about 20%, 23%, but versus the non junket business, it's about 39% reserve.
Okay, great. Thank you very much. Your next question comes from Felicia Hendrix.
Hi, guys. So Sheldon, on Singapore, in your prepared remarks, I thought that you had something to the tune of you're generating a 45% to 60% profit. Did I hear that right?
You heard that the range of departmental profits at the casino, which we do every day, different days depending upon the amount came in between 4560, maybe it's give or take 45, maybe 43, maybe 47, but the highest number I saw was 60%. No. I keep saying that we pick up 24% on the taxes alone versus Macau. Thank you, Rob. Versus Macau, we pick up 24%.
And although we do giveaways from 0.75 to 1.0 to the players direct, we save at least 25 basis points on well, the average is probably somewhere between 75 and 1.0 so far at the high end. So we're picking up 24 bps on 24 points on taxes. So that's a very that's a tough explanation. We pick up probably another 11% or 12% on the savings vis a vis the tech reps. And by the way, Mike said, and I'd like to put a little more color to that, said that there will probably be some junket reps.
Now there were junket reps and there were junket reps. Let's talk to the Macau style junket reps and then Las Vegas style junket reps. Las Vegas style junket reps are really field salespeople that send customers in for which they get paid a basis of theoretical win with a cap. And some of the higher end players that people send in, they make, what, dollars 8,000 to $10,000 the field salespeople, the junket reps in the field. But they're both unfortunately called the same thing.
Then there's the Macau style junket reps that not only deliver the customer, they provide the credit in collection and they provide the cash. So there's I don't believe there's going to be a lot of the Macau style junket reps approved because I've talked to a couple of them myself, the only couple I've ever talked to. And they say they certainly don't want to give out the information that they're very private people and they have they deal with a lot of cash. And they'll never submit that kind of information. So I am very pessimistic that any of the Macau style junket reps will be approved or will either not apply or will not be approved for inadequate information in Singapore.
Now there may be some field salespeople that have jugular reps like we use here in Las Vegas that might be approved.
So but okay. So this range, which is impressive to be begin with is kind of within your 1st 8 days, assuming that like other new casinos you might not be as efficient. I mean could we see this range shift
higher? Well, there's you have certain fixed expenses. So I don't know how much higher you will get. It has been our highest range of estimate was in the 60s, but it's I don't know how it can get much higher than that because we have certain fixed charges.
It really depends based on the mix. We're doing 3 very diverse segments of this so far. The swap business is one terrific segment thus far as Sheldon Mike referenced. The mass table market so far has been very exciting to us. As we mentioned, the premium really depends on the segment you're in because obviously the most difficult segment margin wise is going to be the premium, right?
Because you're discounting, you're doing other things, you're rolling, so you've got expenses against that. As long as our mix, we're doing very well in all three segments, but depends on the mix how strong the margin gets because obviously in the slot machines, just for example, on $400,000,000 $500,000,000 of slot revenue, your margins are going to be extraordinary far beyond 45%. It really depends on your mix. And if your mix of the mass tables ends up being $5,000,000 to $10,000,000 that could be extraordinary. All of this labor and nominal complementary.
So it really depends on the mix of your revenues. The most difficult would be obviously the premium segment. But I think it really depends what Sheldon's referencing is thus far and all three segments are very strong. So it depends on which segment performs the best as to what the eventual margin will be.
Okay. Just staying on the margin topic, if we could move to Las Vegas for a minute, Rob. In this quarter, you guys obviously saw a nice benefit from strong baccarat play which helped margins. But when we think about I know you're getting a little more optimistic, but when we think about kind of how you should look for, I don't know the next year or so, I mean is this a margin base you're comfortable with or should we kind of when we go forward and model take into consideration that maybe you had just extra good baccarat play this quarter?
Let's be candid. No one can refute the fact we had exceptional our team our Las Vegas base sales team for the Asian business, I think, is extraordinary in improving it right now in Singapore and improving in Las Vegas. However, unfortunately, we can't figure out how to get the Chinese to come every quarter. Like we want to make Chinese news every month. We haven't figured that out yet.
So let's be clear that we dropped a half we dropped $550,000,000 and hold 30 some percent. That's a pretty good thing, right? But what I think is most exciting for Venetian Plaza Las Vegas is this is what Sheldon prophesied a decade ago in terms of the group convention business still holds true. And as the market returns, keep in mind, something I always tell people, which is every $10 of ADR can contribute $20,000,000 to $25,000,000 of EBITDA. So I think we're really the 1st guys to step up and anticipate as a top tier property.
When the convention segment moves up and the group segment appreciates, dollars 10,000,000 of ADR translates to $20,000,000 $25,000,000 of ADR of EBITDA. I don't want to depend on Asian high rollers or even softwares. The base business we're in is rooms and rates. And we need rates to move for us to get back. We want to be back to 6% and 7%.
But I think when it does come to be, we'll be the 1st guy to jump in and participate from that side. So margins are going to be are not going to be consistently holding that kind of handle. Obviously, that drives our business. We're very proud of our slot win. We had exceptional slot results, we began almost $50,000,000 of top line.
But again, what drives Las Vegas are room rates. And right now, room rates will continue to be the decider of margin, decider of EBITDA. I just think when things get better, and I hate to be overly optimistic, but it's been a good couple of 3, 4 weeks of weekend stuff. If we can bring ADRs back $30, $40 this place makes a whole bunch of money.
Okay. And then speaking of that, when you think about 2011, you touched on this somewhat, but what kind of rates are you booking your group business at yet so far?
We're trying to stay above $200 In some groups, we're getting higher than that. Very candidly, our goal is to exceed 200 dollars and $11 I can't tell you we're there yet. We have some business with flags that goes back 6 to 8 months. This is a very competitive group market. And unfortunately, some people in the town just don't believe that if they can charge $2.50 $300 We believe if some people would stop discounting aggressively, this market could move quickly.
And I mean that versus 2, I think the upside for us is significant. It's material to our EBITDA. But for our group business to move, every time we take a piece of business and we got to knock it down $30, $40 because someone else says I'll go to $170, it's painful, but it's a fact of life. I think the town has to regain its sea legs and it's believed that's a great place to visit. It's stupidly inexpensive.
Groups are flocking here because despite some comments on Las Vegas earlier, Las Vegas is the best place in the world that your group and people don't have a group for a meeting here, it's silly. The rates are ridiculously cheap. I think you're going to trend up aggressively when people believe in the town. And I hope it's going to happen shortly, but I think our reach for 11 will be hopefully above 2%, 2.15%, but that's the best I can hope for right now for 11.
Okay. And then final question, Sheldon, how is your how are the condo sales going?
How are the what condos? Ops.
Co ops, I'm sorry, the co ops.
The co ops. We are just in the throes of getting the final okay in days. The last e mail I got from Jacob said that he expects the ability to move it into the separate corporation that we've set up and that he would immediately start selling. The responsibility for that was moved from the Minister of Finance to the Minister of Public Works. And the last e mail I got was positive, was optimistic about our getting okay.
And the sales activity, the condo, they don't have co op over there. But the condo market in Hong Kong, as an example, was very strong in the condo market in Shanghai, which caused the Chinese government to say, well, we want to cool this hot market off. The markets have been hot enough. And as Micah said, we're looking for other foreigners. We're not looking for Macau residents.
So the Steve Jacobs was the sales department was looking at $1500 a foot, and I told him that we should keep our original target of $17.50 a foot. And we're looking at a strong market in both Korea and Japan.
Great. Okay. Thanks, guys.
Your final question comes from Larry Klaskin.
I used to be first on the Hey, you saved the best
for last, what can I say? Actually, majority of my questions were answered. I guess, one question would be, as far as Singapore goes, have you guys still in the mode of ramping up the mall? And would you still consider selling that mall if you're allowed to?
Not yet.
We can't sell it for
couple of years. No, not at all. Under the sale of real estate, we can't sell it I think for 7 years. However, I still think it will be we'll get a lot more up in the next several months. We'll ramp up to completion, should be completed by the end of the year.
But I wouldn't even consider it until we found out that it matured. By matured, meaning that it has gone up substantially that a lot of the tenants are in percentage rents, which go from 12.5 to 18 there, just like Macau. And I wouldn't consider some of it now.
All right. So once you hit Orchard Street numbers and passed, you'll look at what you
can do with it. I mean,
you could No. We'll have to grow, Larry, and then see what happens if we level up the growth or the growth rate stops. If we feel we're getting towards the maximum, we've got to leave some room for anybody who buys it to have some growth in it too besides just inflation. So I would say it's if I had to give an answer today, I would say it's probably at least 2 years, maybe 3 away.
From my understanding, it's in the cash flow stream. Okay, that's good. That's good. And then other than that, I think all the rest of my questions have been answered. So congratulations on a great quarter.
I think with a good thank you. And I think on a good rate, I think that we'd be able to sell it at a good cap rate. We'll be able to sell it enough money to pay off