THE Marina Bay integrated resort remains the 'No 1' priority for Las Vegas Sands even as the casino operator suspends projects in its Macau headquarters and scales back on a development in Pennsylvania, its top suits promised.
Sands president and chief operating officer William Weidner said the Singapore IR is not only 'a very important project' which offers 'terrific returns on investment', but it is also 'probably the most important project' in their portfolio. -- PHOTO: LAS VEGAS SANDSSands president and chief operating officer William Weidner said the Singapore IR is not only 'a very important project' which offers 'terrific returns on investment', but it is also 'probably the most important project' in their portfolio.
In a conference call early on Tuesday, the embattered company also said it is raising US$2.14 billion in capital, including new funding from its billionaire chief executive, Sheldon Adelson.
Mr Adelson said: 'As part of my visit to Singapore last week, I assured the government we were very committed to the success of Marina Bay Sands and would have the funding necessary to complete this development. That is exactly where we stand today.'
However, Sands' promise to open the entire IR at the end of next year will not be fulfilled. When it opens its doors end next year, two of three hotel towers, a portion of the retail mall, most of the convention space and the casino will be ready. The other facilities like the remaining hotel block and sky park will open in 2010.
The listed company posted a worse-than-expected net loss of US$32.2 million, or 9 cents a share, for the third quarter that ended Sept 30.
A year ago, it posted a loss of US$48.5 million, or 14 cents a share, due to expenses in preparation to open new casinos in Macau and Las Vegas.
Revenue rose 67 per cent to US$1.11 billion, from US$661 million a year earlier. Adjusted earnings were 2 cents per share, down from 12 cents per share last year.
Mr Adelson said the capital raise will 'put to rest' any speculation that the company is in danger of going belly-up.
It expects to release details of a US$2 billion bond sale soon. It will also save US$1.8 million by halting construction and 'indefinitely' delaying its US$600 million condominium project on the Las Vegas Strip, pushing back development of part of its US$12 billion project in Macau and curbing plans for its Bethlehem casino by delaying the accompanying hotel and retail openings.
Mr Weidner said the current capital market conditions will not impact the Singapore development since the S$5.44 billion credit facility had been secured earlier in the year.
To date, he said the company has invested US$1.81 billion in construction costs, including land price, in the Marina Bay project to date, of which an approximate US$616 million was in equity.
And the current estimated cost to complete the project is about US$2.7 billion,which the company expects to fund 75 to 80 per cent through the credit facility, of which about US$2 billion is available. The company is also expected to invest an additonal $500 million in equity for the project through to the targeted opening in late next year.
Mr Weidner called the Singapore project one of its 'crown jewels' because of the low tax rates, high number of visitor days, and its benefit in operating in a dualpoly. The Singapore casino, which wil have 1,000 gaming tables, is expected to add an annual operating profit of US$1.26 billion by 2012.
Sands declined to comment on a staggered opening for the Marina Bay IR.
Marina Bay Sands general manager George Tanasijevich would only say: 'The majority of our integrated resort will be opened on Day 1; we are in discussions with the Singapore Government on a suitable timetable for the rest of the attractions.'
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