e10vq
UNITED STATES
SECURITIES & EXCHANGE COMMISSION
Washington, D.C.
20549
Form 10-Q
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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended
March 31, 2007
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the Transition period
from to
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Commission file number
001-32373
LAS VEGAS
SANDS CORP.
(Exact name of registration as
specified in its charter)
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Nevada
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27-0099920
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(State or other jurisdiction
of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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3355 Las Vegas Boulevard
South
Las Vegas, Nevada
(Address of principal
executive offices)
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89109
(Zip Code)
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(702) 414-1000
(Registrants telephone
number, including area code)
Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been
subject to such filing requirements for the past
90 days. Yes þ No o
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated
filer. See definition of accelerated filer and large
accelerated filer in
Rule 12b-2
of the Exchange Act.
Large accelerated
filer þ Accelerated
filer o Non-accelerated
filer o
Indicate by check mark whether the registrant is a shell company
(as defined in
Rule 12b-2
of the Exchange
Act). Yes o No þ
Indicate the number of shares outstanding of each of the
Registrants classes of common stock, as
of ,
2007.
LAS VEGAS
SANDS CORP.
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Class
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Outstanding at May 8, 2007
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Common Stock ($0.001 par
value)
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354,814,310 shares
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LAS VEGAS
SANDS CORP.
Table of
Contents
1
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ITEM 1
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FINANCIAL
STATEMENTS
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LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
Condensed
Consolidated Balance Sheets
(Unaudited)
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March 31,
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December 31,
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2007
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2006
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(In thousands,
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except share data)
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ASSETS
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Current assets:
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Cash and cash equivalents
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$
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439,525
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$
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468,066
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Restricted cash
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290,683
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398,762
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Accounts receivable, net
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120,854
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173,683
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Inventories
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13,052
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12,291
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Deferred income taxes
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16,553
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15,688
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Prepaid expenses and other
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28,856
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25,067
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Total current assets
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909,523
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1,093,557
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Property and equipment, net
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5,344,802
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4,582,325
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Deferred financing costs, net
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66,747
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70,381
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Restricted cash
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265,336
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555,132
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Deferred income taxes
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1,014
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Leasehold interest in land, net
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911,621
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801,195
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Other assets, net
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36,609
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23,868
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Total assets
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$
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7,535,652
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$
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7,126,458
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LIABILITIES AND
STOCKHOLDERS EQUITY
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Current liabilities:
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Accounts payable
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$
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56,192
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$
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51,038
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Construction payables
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367,109
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329,375
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Accrued interest payable
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4,458
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8,496
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Other accrued liabilities
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322,159
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318,901
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Income taxes payable
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20,352
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Current maturities of long-term
debt
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165,610
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6,486
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Total current liabilities
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915,528
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734,648
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Other long-term liabilities
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17,068
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10,742
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Deferred income taxes
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324
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Deferred gain on sale of The Grand
Canal Shops
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63,799
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64,665
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Deferred rent from The Grand Canal
Shops transaction
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104,466
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104,773
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Long-term debt
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4,258,356
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4,136,152
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Total liabilities
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5,359,217
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5,051,304
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Commitments and contingencies
(Note 7)
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Stockholders equity:
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Common stock, $0.001 par
value, 1,000,000,000 shares authorized, 354,809,535 and
354,492,452 shares issued and outstanding
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355
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354
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Capital in excess of par value
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1,009,748
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990,429
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Accumulated other comprehensive
loss
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(5,428
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)
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(580
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)
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Retained earnings
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1,171,760
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1,084,951
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Total stockholders equity
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2,176,435
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2,075,154
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Total liabilities and
stockholders equity
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$
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7,535,652
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$
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7,126,458
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The accompanying notes are an integral part of these condensed
consolidated financial statements.
2
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
Condensed
Consolidated Statements of Operations
(Unaudited)
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Three Months Ended
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March 31,
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2007
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2006
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(In thousands,
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except share and per share data)
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Revenues:
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Casino
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$
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465,734
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$
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375,382
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Rooms
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97,868
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91,138
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Food and beverage
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54,359
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51,816
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Convention, retail and other
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43,046
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35,005
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661,007
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553,341
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Less promotional
allowances
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(32,789
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)
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(22,977
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)
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Net revenues
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628,218
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530,364
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Operating expenses:
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Casino
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278,697
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205,344
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Rooms
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22,524
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21,753
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Food and beverage
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23,633
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24,057
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Convention, retail and other
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17,431
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16,395
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Provision for doubtful accounts
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15,516
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4,989
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General and administrative
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57,971
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54,812
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Corporate expense
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18,519
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12,954
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Rental expense
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6,708
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3,707
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Pre-opening expense
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22,457
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2,219
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Development expense
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2,346
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9,168
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Depreciation and amortization
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31,232
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25,005
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Loss on disposal of assets
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178
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1,081
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497,212
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381,484
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Operating income
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131,006
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148,880
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Other income (expense):
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Interest income
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12,664
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10,214
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Interest expense, net of amounts
capitalized
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(34,612
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)
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(21,415
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)
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Other income (expense)
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(7,033
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)
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164
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Income before income taxes
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102,025
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137,843
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Provision for income taxes
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(11,111
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)
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(16,060
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)
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Net income
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$
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90,914
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$
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121,783
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Basic earnings per share
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$
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0.26
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$
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0.34
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Diluted earnings per share
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$
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0.26
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$
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0.34
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Weighted average shares
outstanding:
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Basic
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354,613,724
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354,199,253
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Diluted
|
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356,114,292
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354,592,597
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The accompanying notes are an integral part of these condensed
consolidated financial statements.
3
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
Condensed
Consolidated Statements of Cash Flows
(Unaudited)
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Three Months Ended
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March 31,
|
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2007
|
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2006
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(In thousands)
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Cash flows from operating
activities:
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Net income
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$
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90,914
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$
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121,783
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Adjustments to reconcile net income
to net cash provided by operating activities:
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Depreciation and amortization
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31,232
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25,005
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Amortization of leasehold interest
in land included in rental expense
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4,213
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|
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Amortization of deferred financing
costs and original issue discount
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|
5,054
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2,074
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Amortization of deferred gain and
rent
|
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|
(1,173
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)
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|
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(1,172
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)
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Loss on disposal of assets
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|
178
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|
|
|
1,081
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Stock-based compensation expense
|
|
|
4,448
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|
|
|
2,862
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Provision for doubtful accounts
|
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|
15,516
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|
|
|
4,989
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|
Tax benefit from stock option
exercises
|
|
|
(2,293
|
)
|
|
|
(632
|
)
|
Deferred income taxes
|
|
|
(2,203
|
)
|
|
|
6,851
|
|
Changes in operating assets and
liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
37,313
|
|
|
|
(28,661
|
)
|
Inventories
|
|
|
(761
|
)
|
|
|
(678
|
)
|
Prepaid expenses and other
|
|
|
(12,768
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)
|
|
|
(6,857
|
)
|
Leasehold interest in land
|
|
|
(105,934
|
)
|
|
|
|
|
Accounts payable
|
|
|
5,154
|
|
|
|
9,456
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|
Accrued interest payable
|
|
|
(4,038
|
)
|
|
|
(4,641
|
)
|
Other accrued liabilities
|
|
|
5,962
|
|
|
|
5,534
|
|
Income taxes payable
|
|
|
(19,463
|
)
|
|
|
8,832
|
|
|
|
|
|
|
|
|
|
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Net cash provided by operating
activities
|
|
|
51,351
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|
|
|
145,826
|
|
|
|
|
|
|
|
|
|
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Cash flows from investing
activities:
|
|
|
|
|
|
|
|
|
Change in restricted cash
|
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|
398,571
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|
|
|
(47,786
|
)
|
Capital expenditures
|
|
|
(764,964
|
)
|
|
|
(294,233
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)
|
|
|
|
|
|
|
|
|
|
Net cash used in investing
activities
|
|
|
(366,393
|
)
|
|
|
(342,019
|
)
|
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
|
|
|
|
|
Proceeds from exercise of stock
options
|
|
|
9,983
|
|
|
|
1,864
|
|
Tax benefit from stock option
exercises
|
|
|
2,293
|
|
|
|
632
|
|
Proceeds from Macao credit facility
|
|
|
85,000
|
|
|
|
|
|
Proceeds from Singapore credit
facility
|
|
|
110,777
|
|
|
|
|
|
Proceeds from airplane financings
|
|
|
72,000
|
|
|
|
|
|
Proceeds from senior secured credit
facility-revolver
|
|
|
62,000
|
|
|
|
92,129
|
|
Proceeds from Phase II mall
construction loan
|
|
|
35,000
|
|
|
|
14,000
|
|
Proceeds from FF&E credit
facility and other long-term debt
|
|
|
6,082
|
|
|
|
75
|
|
Repayments on Venetian Intermediate
credit facility
|
|
|
|
|
|
|
(50,000
|
)
|
Repayment on senior secured credit
facility-revolver
|
|
|
(99,000
|
)
|
|
|
|
|
Repayments on FF&E credit
facility and other long-term debt
|
|
|
(605
|
)
|
|
|
(1,200
|
)
|
Repayments on The Sands Expo Center
mortgage loan
|
|
|
(535
|
)
|
|
|
(951
|
)
|
Payments of deferred financing costs
|
|
|
(1,284
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing
activities
|
|
|
281,711
|
|
|
|
56,549
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate on cash
|
|
|
4,790
|
|
|
|
75
|
|
|
|
|
|
|
|
|
|
|
Decrease in cash and cash
equivalents
|
|
|
(28,541
|
)
|
|
|
(139,569
|
)
|
Cash and cash equivalents at
beginning of period
|
|
|
468,066
|
|
|
|
456,846
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of
period
|
|
$
|
439,525
|
|
|
$
|
317,277
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure of cash
flow information:
|
|
|
|
|
|
|
|
|
Cash payments for interest
|
|
$
|
80,416
|
|
|
$
|
31,905
|
|
|
|
|
|
|
|
|
|
|
Cash payments for taxes
|
|
$
|
30,000
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash investing and financing
activities:
|
|
|
|
|
|
|
|
|
Property and equipment asset
acquisitions included in construction payables
|
|
$
|
367,109
|
|
|
$
|
182,750
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these condensed
consolidated financial statements.
4
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1
ORGANIZATION AND BUSINESS OF COMPANY
The accompanying condensed consolidated financial statements
should be read in conjunction with the consolidated financial
statements and notes thereto included in the Annual Report on
Form 10-K
of Las Vegas Sands Corp. (a Nevada corporation) and its
subsidiaries (collectively the Company) for the year
ended December 31, 2006. The year-end balance sheet data
was derived from audited financial statements, but does not
include all disclosures required by generally accepted
accounting principles in the United States of America. In the
opinion of management, all adjustments and normal recurring
accruals considered necessary for a fair statement of the
results for the interim period have been included. The interim
results reflected in the unaudited condensed consolidated
financial statements are not necessarily indicative of expected
results for the full year. The Companys common stock is
traded on the New York Stock Exchange under the symbol
LVS.
Operations
The Company owns and operates The Venetian Resort Hotel Casino
(The Venetian), a Renaissance Venice-themed resort
situated on the Las Vegas Strip (the Strip). The
Venetian includes the first all-suites hotel on the Strip with
4,027 suites; a gaming facility of approximately
120,000 gross square feet; an enclosed retail, dining and
entertainment complex of approximately 440,000 net leasable
square feet (The Grand Canal Shops), which was sold
to a third party in 2004; and a meeting and conference facility
of approximately 1.1 million square feet (the
Congress Center). A subsidiary of Las Vegas Sands
Corp. owns and operates an expo and convention center with
approximately 1.2 million square feet (The Sands Expo
Center), which is connected to The Venetian and the
Congress Center.
The Company also owns and operates the Sands Macao Casino (the
Sands Macao), the first Las Vegas-style casino in
Macao, China, which opened in May 2004. The Sands Macao now
offers over 229,000 square feet of gaming facilities after
its expansion, which was completed in August 2006, as well as
several restaurants, VIP facilities, a theater and other
high-end amenities. In addition, the Company continues to
progress according to plan on the expansion of the hotel tower,
which is expected to be completed in September 2007.
United
States Development Projects
The Company is currently constructing The Palazzo Resort Hotel
Casino (The Palazzo), a second resort similar in
size to The Venetian, which is situated on a
14-acre site
next to The Venetian and The Sands Expo Center. The Palazzo will
consist of an all-suites, 50-floor luxury hotel tower with
approximately 3,068 suites, a gaming facility of approximately
105,000 square feet and an enclosed shopping, dining and
entertainment complex of approximately 400,000 net leasable
square feet (the Phase II mall), which the
Company has contracted to sell to a third party. The Palazzo is
expected to open in late 2007. The Company is also constructing
a high-rise residential condominium tower, which will consist of
approximately 300 luxury condominiums and will be situated
between The Palazzo and The Venetian. The condominium tower is
currently expected to open in late fall 2008. In addition, the
Company is in the process of developing a gaming, hotel,
shopping and dining complex (the Sands Bethworks)
located on the site of the Historic Bethlehem Steel Works in
Bethlehem, Pennsylvania, which is expected to open in late 2008.
In its first phase, the
126-acre
development is expected to feature a 300-room hotel,
200,000 square feet of retail space, 3,000 slot machines, a
50,000 square foot multipurpose event center and a variety
of dining options. The Company expects to add an additional
2,000 slot machines in a subsequent phase.
Macao
Development Projects
The Company is building The Venetian Macao Resort Hotel Casino
(The Venetian Macao) on the Cotai
StripTM
in Macao, China. The Venetian Macao will be an approximately
3,000 all-suites hotel, casino and convention center complex
with a Venetian-style theme similar to that of The Venetian in
Las Vegas and is expected to open in late August 2007. In
addition, the Company is developing multiple other properties on
the Cotai Strip.
5
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
The Company has submitted development plans to the Macao
government for six casino-resort developments in addition to The
Venetian Macao on an area of approximately 200 acres
located on the Cotai Strip. The developments are expected to
include hotels, exhibition and conference facilities, casinos,
showrooms, shopping malls, spas, world-class restaurants,
entertainment facilities and other attractions and amenities, as
well as common public areas.
In February 2007, the Company received the final draft of the
land concession agreement from the Macao government pursuant to
which the Company was awarded a concession by lease for parcels
which are referred to as 1, 2 and 3 on the Cotai Strip,
including the sites on which it is building The Venetian Macao
(parcel 1) and the Four Seasons hotel (parcel 2). The
Company has accepted the conditions of the draft land concession
and has made an initial premium payment of 853.0 million
patacas (approximately $105.9 million at exchange rates in
effect on March 31, 2007) towards the aggregate land
premium of 2.59 billion patacas (approximately
$322.0 million at exchange rates in effect on
March 31, 2007). Additionally, the Company received a
credit in the amount of 193.4 million patacas
(approximately $24.0 million at exchange rates in effect on
March 31, 2007) towards the aggregate land premium
related to reclamation work and other works done on the land and
the installation costs of an electrical substation. Each
parcels share of the remaining balance will either be due
upon the completion of the corresponding resort or be payable
through seven equal semi-annual payments to be made over a four
year period and bearing interest at 5%, whichever comes first.
On April 18, 2007, the land concession became effective
when it was published in Macaos Official Gazette. Now that
the land concession is effective, the Company will be required
to make land premium and annual rent payments relating to
parcels 1, 2 and 3 in the amounts and at the times
specified in the land concession. The Company has also commenced
construction on its other Cotai Strip properties on land for
which it has not yet been granted land concessions. If the
Company does not obtain land concessions, it could lose all or a
substantial part of its $162.8 million in capitalized
construction costs to date, related to these other Cotai Strip
properties.
Hengqin
Island Development Project
The Company has entered into a non-binding letter of intent with
the Zhuhai Municipal Peoples Government of the
Peoples Republic of China to work with it to create a
master plan for, and develop, a leisure and convention
destination resort on Hengqin Island, located approximately one
mile from the Cotai Strip, but within mainland China. On
January 10, 2007, the Zhuhai Government established a
Project Coordination Committee to act as a government liaison
empowered to work directly with the Company to advance the
development of the project. The Company has interfaced with this
committee and is actively working with the committee as it
continues to advance its plans. The project remains subject to a
number of conditions, including further governmental approvals.
Singapore
Development Project
In August 2006, the Companys wholly-owned subsidiary,
Marina Bay Sands Pte. Ltd. (MBS), entered into a
development agreement (the Development Agreement)
with the Singapore Tourism Board (STB) to build and
operate an integrated resort called The Marina Bay Sands in
Singapore, which is expected to open in 2009. The Marina Bay
Sands will be a large integrated resort that includes three 50+
story hotel towers (totaling approximately 2,500 suites), a
casino, an enclosed retail, dining and entertainment complex
with approximately 1.0 million net leasable square feet, a
convention center and meeting room complex of approximately
1.2 million square feet, theaters, and a landmark iconic
structure at the bay-front promenade that contains an
art/science museum.
Other
Development Projects
The Company is currently exploring the possibility of operating
integrated resorts in additional Asian jurisdictions, the United
States and Europe.
6
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
Recent
Accounting Pronouncements
In July 2006, the Financial Accounting Standards Board
(FASB) issued Interpretation (FIN)
No. 48, Accounting for Uncertainty in Income
Taxes, which provides guidance for the accounting for
uncertainty in income taxes recognized in the financial
statements in accordance with Statement of Financial Accounting
Standards (SFAS) No. 109, Accounting for
Income Taxes. FIN No. 48 provides guidance on
the financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax return.
FIN No. 48 also provides guidance on derecognition,
classification, interest and penalties, accounting in interim
periods, disclosures and transition. FIN No. 48
requires entities to assess the likelihood that uncertain tax
positions will be accepted by the applicable taxing authority
and then measure the amount of benefit to be recognized for
these purposes which are considered greater than 50% likely to
be sustained. The Company adopted FIN No. 48 as of
January 1, 2007 and recorded a reduction to opening
retained earnings of $4.1 million.
In September 2006, the FASB issued SFAS No. 157,
Fair Value Measurements, which defines fair value,
establishes a framework for measuring fair value, and expands
disclosures about fair value measurements.
SFAS No. 157 applies under other accounting
pronouncements that require or permit fair value measurement.
SFAS No. 157 does not require any new fair value
measurements and the Company does not expect the application of
this standard to change its current practices. The provisions of
SFAS No. 157 are effective for financial statements
issued for fiscal years beginning after November 15, 2007
and interim periods within those fiscal years.
In February 2007, the FASB issued SFAS No. 159,
The Fair Value Option for Financial Assets and Liabilities
Including an Amendment of FASB Statement No. 115.
Under SFAS No. 159, the Company may elect to measure
many financial instruments and certain other items at fair
value, which are not otherwise currently required to be measured
at fair value. The decision to measure items at fair value is
made at specific election dates on an irrevocable
instrument-by-instrument
basis and requires recognition of the changes in fair value in
earnings and expensing upfront costs and fees associated with
the item for which the fair value option is elected. Fair value
instruments for which the fair value option has been elected and
similar instruments measured using another measurement attribute
are to be distinguished on the face of the statement of
financial position. SFAS No. 159 is effective for
financial statements beginning after November 15, 2007. The
Company does not expect the application of this standard to
change its current practices.
NOTE 2
STOCKHOLDERS EQUITY AND EARNINGS PER SHARE
Changes in stockholders equity for the three months ended
March 31, 2007 were as follows (in thousands):
|
|
|
|
|
Balance at December 31, 2006
|
|
$
|
2,075,154
|
|
Net income
|
|
|
90,914
|
|
Stock-based compensation
|
|
|
4,885
|
|
Proceeds from exercise of stock
options
|
|
|
9,983
|
|
Tax benefit from exercise of stock
options
|
|
|
4,452
|
|
Change in accumulated other
comprehensive loss
|
|
|
(4,848
|
)
|
Cumulative effect from adoption of
FIN No. 48
|
|
|
(4,105
|
)
|
|
|
|
|
|
Balance at March 31, 2007
|
|
$
|
2,176,435
|
|
|
|
|
|
|
At March 31, 2007 and December 31, 2006, the
accumulated other comprehensive income balance consisted solely
of foreign currency translation adjustments. For the three
months ended March 31, 2007 and 2006, comprehensive income
amounted to $86.1 million and $121.5 million,
respectively.
7
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
The weighted average number of common and common equivalent
shares used in the calculation of basic and diluted earnings per
share consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Weighted-average common shares
outstanding (used in the calculation of basic earnings per share)
|
|
|
354,613,724
|
|
|
|
354,199,253
|
|
Potential dilution from stock
options and restricted stock
|
|
|
1,500,568
|
|
|
|
393,344
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common and common
equivalent shares (used in the calculations of diluted earnings
per share)
|
|
|
356,114,292
|
|
|
|
354,592,597
|
|
|
|
|
|
|
|
|
|
|
Antidilutive stock options
excluded from calculation of diluted earnings per share
|
|
|
859,973
|
|
|
|
2,223,714
|
|
|
|
|
|
|
|
|
|
|
NOTE 3
PROPERTY AND EQUIPMENT
Property and equipment consists of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Land and land improvements
|
|
$
|
212,559
|
|
|
$
|
207,144
|
|
Building and improvements
|
|
|
1,622,917
|
|
|
|
1,622,783
|
|
Equipment, furniture, fixtures and
leasehold improvements
|
|
|
563,696
|
|
|
|
528,882
|
|
Construction in progress
|
|
|
3,447,053
|
|
|
|
2,694,180
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,846,225
|
|
|
|
5,052,989
|
|
Less: accumulated depreciation and
amortization
|
|
|
(501,423
|
)
|
|
|
(470,664
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5,344,802
|
|
|
$
|
4,582,325
|
|
|
|
|
|
|
|
|
|
|
Construction in progress consists of the following (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Sands Macao
|
|
$
|
29,835
|
|
|
$
|
17,443
|
|
The Venetian Macao
|
|
|
1,898,583
|
|
|
|
1,544,622
|
|
Other Macao Development Projects
|
|
|
188,338
|
|
|
|
130,355
|
|
The Marina Bay Sands
|
|
|
88,632
|
|
|
|
30,511
|
|
The Palazzo and Phase II Mall
|
|
|
1,130,942
|
|
|
|
916,302
|
|
Other
|
|
|
110,723
|
|
|
|
54,947
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
3,447,053
|
|
|
$
|
2,694,180
|
|
|
|
|
|
|
|
|
|
|
During the three months ended March 31, 2007 and 2006, the
Company capitalized interest expense of $46.8 million and
$8.3 million, respectively.
8
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
NOTE 4
LONG-TERM DEBT
Long-term debt consists of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Corporate and
U.S. Related:
|
|
|
|
|
|
|
|
|
Senior Secured Credit
Facility Term B and Term B Delayed Draw
|
|
$
|
1,170,000
|
|
|
$
|
1,170,000
|
|
Senior Secured Credit
Facility Revolving Facility
|
|
|
223,128
|
|
|
|
260,128
|
|
6.375% Senior Notes
|
|
|
248,210
|
|
|
|
248,153
|
|
The Sands Expo Center Mortgage Loan
|
|
|
90,333
|
|
|
|
90,868
|
|
Phase II Mall Construction
Loan
|
|
|
149,500
|
|
|
|
114,500
|
|
Airplane Financings
|
|
|
72,000
|
|
|
|
|
|
FF&E Credit
Facility Term Funded
|
|
|
6,790
|
|
|
|
7,395
|
|
FF&E Credit
Facility Term Delayed Draw
|
|
|
37,582
|
|
|
|
37,582
|
|
Macao Related:
|
|
|
|
|
|
|
|
|
Macao Credit Facility
Term B and Local Term
|
|
|
1,300,000
|
|
|
|
1,300,000
|
|
Macao Credit Facility
Term B Delayed
|
|
|
85,000
|
|
|
|
|
|
Other Debt
|
|
|
6,082
|
|
|
|
|
|
Singapore Related:
|
|
|
|
|
|
|
|
|
Singapore Credit
Facility Term Loan
|
|
|
455,412
|
|
|
|
393,510
|
|
Singapore Credit
Facility Floating Rate Notes
|
|
|
579,929
|
|
|
|
520,502
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,423,966
|
|
|
|
4,142,638
|
|
Less: current maturities
|
|
|
(165,610
|
)
|
|
|
(6,486
|
)
|
|
|
|
|
|
|
|
|
|
Total long-term debt
|
|
$
|
4,258,356
|
|
|
$
|
4,136,152
|
|
|
|
|
|
|
|
|
|
|
In February 2007, the Company entered into promissory notes
totaling $72.0 million (the Airplane
Financings) to finance the purchase of one airplane and
refinance two others that were already owned (the
Aircraft). The Airplane Financings consist of
balloon payment promissory notes (the Balloon Notes)
and amortizing promissory notes (the Amortizing
Notes), all of which have ten year maturities and are
collateralized by the Aircraft. The Airplane Financings bear
interest at three-month LIBOR plus 1.5% (6.86% at March 31,
2007). The Amortizing Notes, which total $28.8 million, are
subject to quarterly principal and interest payments beginning
June 1, 2007. The Balloon Notes, which total
$43.2 million, are subject to quarterly interest payments
beginning June 1, 2007, with the principal payments due in
full on March 1, 2017. At March 31, 2007, the book
value of the Aircraft collateralizing the Airplane Financings
was $67.8 million.
In March 2007, the Company entered into a promissory note (the
Other Debt) totaling $6.1 million bearing
interest at 5.75% with the principal payment due in full on
March 28, 2008.
In March 2007, the $2.5 billion Macao credit facility was
amended to expand the use of proceeds and remove certain
restrictive conditions. In April 2007, the lenders of the Macao
credit facility approved a reduction of the interest rate margin
for all classes of loans by 50 basis points and the Company
exercised its rights under the Macro credit facility to access
the $800.0 million of incremental facilities under the
accordion feature set forth therein, which increased the total
credit facility to $3.3 billion. In April 2007, the Company
borrowed $600.0 million of the $800.0 million
accordion feature.
On April 17, 2007, the Company announced that its
subsidiary, Las Vegas Sands, LLC (LVSLLC), commenced
the marketing of a $5.0 billion senior secured credit
facility, which is expected to consist of a $3.0 billion
funded term loan, a $600.0 million delayed draw term loan
(which will be available for 12 months after
9
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
closing), a $400.0 million delayed draw term loan (which
will be available for 18 months after closing) and a
$1.0 billion revolving credit facility. The proceeds of the
senior secured credit facility will be used to
(i) refinance LVSLLCs indebtedness under its current
credit facility, repay the Phase II mall construction loan,
which is due in March 2008, repay the FF & E credit
facilities, and repay The Sands Expo Center mortgage loan,
(ii) fund domestic development projects, including
permitted investments and certain restricted payments,
(iii) provide liquidity to support international
development projects, and (iv) fund working capital and for
general corporate purposes. Domestic development projects
include: the completion of The Palazzo and the Phase II
mall, the construction of The Palazzo condominium tower, the
refurbishment of rooms at The Venetian, the construction of a
new convention center to be built near The Sands Expo Center
with direct access to the casino complex, and the construction
of Sands Bethworks.
NOTE 5
INCOME TAXES
The Company adopted the provisions of FIN No. 48 on
January 1, 2007. As a result of the implementation of
FIN No. 48, the Company recognized a $4.1 million
increase in the liability for unrecognized tax benefits, which
was accounted for as a reduction to opening retained earnings.
At the adoption date of January 1, 2007, the Company had
$8.5 million of unrecognized tax benefits, of which
$6.1 million would affect the effective income tax rate if
recognized.
The Company files income tax returns in the U.S., various states
and foreign jurisdictions. The Company is subject to federal,
state and local, or foreign income tax examinations by tax
authorities for years after 2002. The Company is not presently
under examination by any major tax jurisdiction.
The Company recognizes interest and penalties, if any, related
to unrecognized tax benefits in the provision for income taxes
on the statement of operations. At January 1, 2007, the
date of adoption, and at March 31, 2007, the Company did
not accrue any significant interest or penalties.
NOTE 6
STOCK-BASED EMPLOYEE COMPENSATION
The compensation expense for the three months ended
March 31, 2007 and 2006 was $4.4 million and
$2.9 million, respectively, which is comprised of
$4.1 million from stock options and $0.3 million from
restricted stock for the three months ended March 31, 2007
and $2.6 million from stock options and $0.3 million
from restricted stock for the three months ended March 31,
2006. Compensation cost capitalized as part of property and
equipment was $0.5 million and $0.4 million for the
three months ended March 31, 2007 and 2006, respectively.
During the three months ended March 31, 2007 and 2006,
409,573 options and 2,184,361 options were granted with weighted
average grant date fair values of $37.56 and $17.36 per
share, respectively. In addition, during the three months ended
March 31, 2007 and 2006, 46,474 restricted shares and
73,370 restricted shares were granted with weighted average
grant date fair values of $87.32 and $42.59 per share,
respectively.
NOTE 7
COMMITMENTS AND CONTINGENCIES
The Company is involved in other litigation in addition to those
noted below, arising in the normal course of business.
Management has made certain estimates for potential litigation
costs based upon consultation with legal counsel. Actual results
could differ from these estimates; however, in the opinion of
management, such litigation and claims will not have a material
effect on the Companys financial condition, results of
operations or cash flows.
The
Palazzo Construction Litigation
Lido Casino Resort, LLC (Lido), formerly a
wholly-owned subsidiary of the Company and now merged into
Venetian Casino Resort, LLC, another wholly-owned subsidiary of
the Company, and its construction manager, Taylor International
Corp. (Taylor), filed suit in March 2006 in the
United States District Court for the District of Nevada (the
District Court) against Malcolm Drilling Company,
Inc. (Malcolm), the contractor on The Palazzo
10
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
project responsible for completing certain foundation work (the
District Court Case). Lido and Taylor claimed in the
District Court Case that Malcolm was in default of its contract
for performing defective work, failing to correct defective
work, failing to complete its work and causing delay to the
project. Malcolm responded by filing a Notice of a Lien with the
Clerk of Clark County, Nevada in March 2006 in the amount of
approximately $19.0 million plus interest, costs and
attorneys fees (the Lien). In April 2006, Lido
and Taylor moved in the District Court Case to strike or, in the
alternative, to reduce the amount of, the Lien, claiming, among
other things, that the Lien was excessive for including claims
for disruption and delay, which Lido and Taylor claim are not
lienable under Nevada law (the Lien Motion). Malcolm
responded in April 2006 by filing a complaint against Lido and
Taylor in District Court of Clark County, Nevada seeking to
foreclose on the Lien against Taylor, claiming breach of
contract, a cardinal change in the underlying contract, unjust
enrichment against Lido and Taylor and bad faith and fraud
against Taylor (the State Court Case), and
simultaneously filed a motion in the District Court Case,
seeking to dismiss the District Court Case on abstention grounds
(the Abstention Motion). In response, in June 2006,
Lido filed a motion to dismiss the State Court Case based on the
principle of the prior pending District Court Case
(the Motion to Dismiss). In June 2006, the
Abstention Motion was granted in part by the United States
District Court, the District Court Case was stayed pending the
outcome of the Motion to Dismiss in the State Court Case and the
Lien Motion was denied without prejudice. Lido and Malcolm then
entered into a stipulation under which Lido withdrew the Motion
to Dismiss, and in July 2006 filed a replacement lien motion in
the State Court Case. The lien motion in the State Court Case
was denied in August 2006 and Lido and Taylor filed a permitted
interlocutory notice of appeal to the Supreme Court of Nevada in
September 2006. On April 11, 2007, Malcolm filed an Amended
Notice of Lien with the Clerk of Clark County, Nevada in the
amount of approximately $16.7 million plus interest, costs
and attorneys fees. This matter remains in discovery and
based upon the advice of legal counsel, management has
determined that based on proceedings to date, it is currently
unable to determine the probability of the outcome of this
matter. Lido intends to defend itself against the claims pending
in the State Court Case.
Litigation
Relating to Macao Casino
On October 15, 2004, Richard Suen and Round Square Company
Limited filed an action against Las Vegas Sands Corp., Las Vegas
Sands, Inc., Sheldon G. Adelson and William P. Weidner in the
District Court of Clark County, Nevada, asserting a breach of an
alleged agreement to pay a success fee of $5.0 million and
2.0% of the net profit from the Companys Macao resort
operations to the plaintiffs as well as other related claims. In
March 2005, Las Vegas Sands Corp. was dismissed as a party
without prejudice based on a stipulation to do so between the
parties. On May 17, 2005, the plaintiffs filed their first
amended complaint. On February 2, 2006, defendants filed a
motion for partial summary judgment with respect to
plaintiffs fraud claims against all the defendants. On
March 16, 2006, an order was filed by the court granting
defendants motion for partial summary judgment. Pursuant
to the order filed March 16, 2006, plaintiffs fraud
claims set forth in the first amended complaint were dismissed
with prejudice as against all defendants. The order also
dismissed with prejudice the first amended complaint against
defendants Sheldon G. Adelson and William P. Weidner.
This action is in a preliminary stage, discovery has begun and
the Company has filed a motion for partial summary judgment.
Based upon the advice of legal counsel, management has
determined that based on proceedings to date, the probability of
an unfavorable outcome in this matter is remote. The Company
intends to defend this matter vigorously.
On January 26, 2006, Clive Basset Jones, Darryl Steven
Turok (a/k/a Dax Turok) and Cheong Jose Vai Chi
(a/k/a Cliff
Cheong), filed an action against Las Vegas Sands Corp., Las
Vegas Sands, LLC, Venetian Venture Development, LLC and various
unspecified individuals and companies in the District Court of
Clark County, Nevada. The plaintiffs assert breach of an
agreement to pay a success fee in an amount equal to 5% of the
ownership interest in the entity that owns and operates the
Macau SAR gaming subconcession as well as other related claims.
In April 2006, Las Vegas Sands Corp. was dismissed as a party
without prejudice based on a stipulation to do so between the
parties. Other than the complaint which has been filed, and the
Companys answer, there is currently no pending activity in
the matter. This action is in a preliminary stage and discovery
has begun. Based upon the advice
11
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
of legal counsel, management has determined that based on
proceedings to date, it is currently unable to determine the
probability of the outcome of this matter. The Company intends
to defend this matter vigorously.
On February 5, 2007, Asian American Entertainment
Corporation, Limited (AAEC) filed an action against
Las Vegas Sands, Inc. (LVSI), Venetian Casino
Resort, LLC (VCR), Venetian Venture Development, LLC
(Venetian Venture Development), William P.
Weidner and David Friedman in the United States District Court
for the District of Nevada. The plaintiffs assert breach of
contract by LVSI, VCR and Venetian Venture Development of an
agreement under which AAEC would work to obtain a gaming license
in Macao and, if successful, AAEC would jointly operate a
casino, hotel and related facilities in Macao with Venetian
Venture Development and Venetian Venture Development would
receive fees and a minority equity interest in the venture and
breach of fiduciary duties by all of the defendants. The
plaintiffs have requested an unspecified amount of actual,
compensatory and punitive damages, disgorgement of profits
related to the Companys Macao gaming license. This action
is in a preliminary stage and the Company has filed a motion to
dismiss the action. Based upon the advice of legal counsel,
management has determined that based on proceedings to date, the
probability of an unfavorable outcome in this matter is remote.
The Company intends to defend this matter vigorously.
NOTE 8
SEGMENT INFORMATION
The Company reviews the results of operations based on the
following geographic segments: (1) Las Vegas, which
includes The Venetian, The Sands Expo Center and The Palazzo
(currently under construction), (2) Macao, which includes
the Sands Macao, The Venetian Macao (currently under
construction) and other development projects and
(3) Singapore, which includes The Marina Bay Sands
(currently under construction). Effective April 1, 2006,
the Company changed its segments based upon changes in the
information used by the chief operation decision maker to
include The Sands Expo Center within the Las Vegas segment. The
information for the three months ended March 31, 2006 has
been reclassified to conform to the current presentation. The
Companys segment information is as follows for the three
months ended March 31, 2007 and 2006 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Net Revenues
|
|
|
|
|
|
|
|
|
Las Vegas
|
|
$
|
277,844
|
|
|
$
|
248,727
|
|
Macao
|
|
|
350,374
|
|
|
|
281,637
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
|
|
$
|
628,218
|
|
|
$
|
530,364
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDAR
|
|
|
|
|
|
|
|
|
Las Vegas
|
|
$
|
112,102
|
|
|
$
|
101,082
|
|
Macao
|
|
|
102,296
|
|
|
|
103,447
|
|
|
|
|
|
|
|
|
|
|
Total adjusted EBITDAR
|
|
|
214,398
|
|
|
|
204,529
|
|
Other Operating Costs and
Expenses
|
|
|
|
|
|
|
|
|
Corporate expense
|
|
|
(18,519
|
)
|
|
|
(12,954
|
)
|
Rental expense
|
|
|
(6,708
|
)
|
|
|
(3,707
|
)
|
Stock-based compensation expense
|
|
|
(1,952
|
)
|
|
|
(1,515
|
)
|
Depreciation and amortization
|
|
|
(31,232
|
)
|
|
|
(25,005
|
)
|
Loss on disposal of assets
|
|
|
(178
|
)
|
|
|
(1,081
|
)
|
Pre-opening expense
|
|
|
(22,457
|
)
|
|
|
(2,219
|
)
|
Development expense
|
|
|
(2,346
|
)
|
|
|
(9,168
|
)
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
131,006
|
|
|
|
148,880
|
|
12
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Other Non-Operating Costs and
Expenses
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
12,664
|
|
|
|
10,214
|
|
Interest expense, net of amounts
capitalized
|
|
|
(34,612
|
)
|
|
|
(21,415
|
)
|
Other income (expense)
|
|
|
(7,033
|
)
|
|
|
164
|
|
Provision for income taxes
|
|
|
(11,111
|
)
|
|
|
(16,060
|
)
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
90,914
|
|
|
$
|
121,783
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Adjusted EBITDAR is earnings before interest, income taxes,
depreciation and amortization, pre-opening expense, development
expense, other income (expense), loss on disposal of assets,
rental expense, corporate expense and stock-based compensation
expense included in general and administrative expense. Adjusted
EBITDAR is used by management as the primary measure of
operating performance of the Companys properties and to
compare the operating performance of the Companys
properties with those of its competitors. |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Capital Expenditures
|
|
|
|
|
|
|
|
|
Las Vegas Sands Corp. and Others
|
|
$
|
46,421
|
|
|
$
|
35
|
|
Las Vegas:
|
|
|
|
|
|
|
|
|
The Venetian
|
|
|
39,508
|
|
|
|
22,711
|
|
The Palazzo
|
|
|
177,809
|
|
|
|
75,453
|
|
Macao:
|
|
|
|
|
|
|
|
|
Sands Macao
|
|
|
18,479
|
|
|
|
16,454
|
|
The Venetian Macao
|
|
|
377,287
|
|
|
|
179,572
|
|
Other Development Projects
|
|
|
62,068
|
|
|
|
|
|
Singapore
|
|
|
43,392
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
Total capital expenditures
|
|
$
|
764,964
|
|
|
$
|
294,233
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Total Assets
|
|
|
|
|
|
|
|
|
Las Vegas Sands Corp. and Others
|
|
$
|
321,858
|
|
|
$
|
209,701
|
|
Las Vegas:
|
|
|
|
|
|
|
|
|
The Venetian
|
|
|
1,857,139
|
|
|
|
1,991,566
|
|
The Palazzo
|
|
|
1,418,405
|
|
|
|
1,179,157
|
|
Macao:
|
|
|
|
|
|
|
|
|
Sands Macao
|
|
|
544,556
|
|
|
|
537,990
|
|
The Venetian Macao
|
|
|
2,143,827
|
|
|
|
2,138,535
|
|
Other Development Projects
|
|
|
236,610
|
|
|
|
170,441
|
|
Singapore
|
|
|
1,013,257
|
|
|
|
899,068
|
|
|
|
|
|
|
|
|
|
|
Total consolidated assets
|
|
$
|
7,535,652
|
|
|
$
|
7,126,458
|
|
|
|
|
|
|
|
|
|
|
13
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
NOTE 9
CONDENSED CONSOLIDATING FINANCIAL INFORMATION
Las Vegas Sands Corp. (LVSC) is the obligor of the
6.375% Senior Notes due 2015 issued by LVSC on
February 10, 2005. Las Vegas Sands, LLC, Venetian Casino
Resort, LLC (VCR), Mall Intermediate Holding
Company, LLC, Venetian Venture Development, LLC, Venetian
Transport, LLC, Venetian Marketing, Inc., Lido Intermediate
Holding Company, LLC and Lido Casino Resort, LLC, which was
merged into VCR in March 2007 (collectively, the Guarantor
Subsidiaries) have jointly and severally guaranteed the
6.375% Senior Notes on a full and unconditional basis.
The condensed consolidating financial information of the
Company, the Guarantor Subsidiaries and the non-guarantor
subsidiaries on a combined basis as of March 31, 2007 and
December 31, 2006, and for the three months ended
March 31, 2007 and 2006, is as follows (in thousands).
14
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING BALANCE SHEETS
March 31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Cash and cash equivalents
|
|
$
|
128,346
|
|
|
$
|
69,329
|
|
|
$
|
241,850
|
|
|
$
|
|
|
|
$
|
439,525
|
|
Restricted cash
|
|
|
50,483
|
|
|
|
91,940
|
|
|
|
148,260
|
|
|
|
|
|
|
|
290,683
|
|
Intercompany receivables
|
|
|
120,574
|
|
|
|
66,282
|
|
|
|
|
|
|
|
(186,856
|
)
|
|
|
|
|
Accounts receivable, net
|
|
|
128
|
|
|
|
110,047
|
|
|
|
10,679
|
|
|
|
|
|
|
|
120,854
|
|
Inventories
|
|
|
|
|
|
|
10,542
|
|
|
|
2,510
|
|
|
|
|
|
|
|
13,052
|
|
Deferred income taxes
|
|
|
1,620
|
|
|
|
15,000
|
|
|
|
|
|
|
|
(67
|
)
|
|
|
16,553
|
|
Prepaid expenses
|
|
|
7,232
|
|
|
|
7,649
|
|
|
|
13,975
|
|
|
|
|
|
|
|
28,856
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
308,383
|
|
|
|
370,789
|
|
|
|
417,274
|
|
|
|
(186,923
|
)
|
|
|
909,523
|
|
Property and equipment, net
|
|
|
135,121
|
|
|
|
2,430,237
|
|
|
|
2,779,444
|
|
|
|
|
|
|
|
5,344,802
|
|
Investment in subsidiaries
|
|
|
2,002,204
|
|
|
|
875,763
|
|
|
|
|
|
|
|
(2,877,967
|
)
|
|
|
|
|
Intercompany notes receivable
|
|
|
72,842
|
|
|
|
52,732
|
|
|
|
|
|
|
|
(125,574
|
)
|
|
|
|
|
Deferred financing costs, net
|
|
|
1,509
|
|
|
|
21,710
|
|
|
|
43,528
|
|
|
|
|
|
|
|
66,747
|
|
Restricted cash
|
|
|
|
|
|
|
187,988
|
|
|
|
77,348
|
|
|
|
|
|
|
|
265,336
|
|
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
4,642
|
|
|
|
(3,628
|
)
|
|
|
1,014
|
|
Leasehold interest in land, net
|
|
|
|
|
|
|
|
|
|
|
911,621
|
|
|
|
|
|
|
|
911,621
|
|
Other assets, net
|
|
|
620
|
|
|
|
19,252
|
|
|
|
16,737
|
|
|
|
|
|
|
|
36,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
2,520,679
|
|
|
$
|
3,958,471
|
|
|
$
|
4,250,594
|
|
|
$
|
(3,194,092
|
)
|
|
$
|
7,535,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
370
|
|
|
$
|
35,206
|
|
|
$
|
20,616
|
|
|
$
|
|
|
|
$
|
56,192
|
|
Construction payables
|
|
|
3,071
|
|
|
|
99,573
|
|
|
|
264,465
|
|
|
|
|
|
|
|
367,109
|
|
Intercompany payables
|
|
|
|
|
|
|
81,402
|
|
|
|
105,454
|
|
|
|
(186,856
|
)
|
|
|
|
|
Accrued interest payable
|
|
|
2,623
|
|
|
|
470
|
|
|
|
1,365
|
|
|
|
|
|
|
|
4,458
|
|
Other accrued liabilities
|
|
|
4,908
|
|
|
|
128,385
|
|
|
|
188,866
|
|
|
|
|
|
|
|
322,159
|
|
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
67
|
|
|
|
(67
|
)
|
|
|
|
|
Current maturities of long-term
debt
|
|
|
2,878
|
|
|
|
1,800
|
|
|
|
160,932
|
|
|
|
|
|
|
|
165,610
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
13,850
|
|
|
|
346,836
|
|
|
|
741,765
|
|
|
|
(186,923
|
)
|
|
|
915,528
|
|
Other long-term liabilities
|
|
|
9,862
|
|
|
|
173,358
|
|
|
|
2,113
|
|
|
|
|
|
|
|
185,333
|
|
Intercompany notes payable
|
|
|
|
|
|
|
|
|
|
|
125,574
|
|
|
|
(125,574
|
)
|
|
|
|
|
Deferred income taxes
|
|
|
3,200
|
|
|
|
428
|
|
|
|
|
|
|
|
(3,628
|
)
|
|
|
|
|
Long-term debt
|
|
|
317,332
|
|
|
|
1,435,645
|
|
|
|
2,505,379
|
|
|
|
|
|
|
|
4,258,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
344,244
|
|
|
|
1,956,267
|
|
|
|
3,374,831
|
|
|
|
(316,125
|
)
|
|
|
5,359,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders equity
|
|
|
2,176,435
|
|
|
|
2,002,204
|
|
|
|
875,763
|
|
|
|
(2,877,967
|
)
|
|
|
2,176,435
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders equity
|
|
$
|
2,520,679
|
|
|
$
|
3,958,471
|
|
|
$
|
4,250,594
|
|
|
$
|
(3,194,092
|
)
|
|
$
|
7,535,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING BALANCE SHEETS
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Non-Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Cash and cash equivalents
|
|
$
|
69,100
|
|
|
$
|
84,581
|
|
|
$
|
314,385
|
|
|
$
|
|
|
|
$
|
468,066
|
|
Restricted cash
|
|
|
50,076
|
|
|
|
67,742
|
|
|
|
280,944
|
|
|
|
|
|
|
|
398,762
|
|
Intercompany receivables
|
|
|
170,844
|
|
|
|
59,004
|
|
|
|
|
|
|
|
(229,848
|
)
|
|
|
|
|
Accounts receivable, net
|
|
|
137
|
|
|
|
120,707
|
|
|
|
52,839
|
|
|
|
|
|
|
|
173,683
|
|
Inventories
|
|
|
|
|
|
|
10,100
|
|
|
|
2,191
|
|
|
|
|
|
|
|
12,291
|
|
Deferred income taxes
|
|
|
1,583
|
|
|
|
14,171
|
|
|
|
|
|
|
|
(66
|
)
|
|
|
15,688
|
|
Prepaid expenses and other
|
|
|
1,793
|
|
|
|
7,826
|
|
|
|
15,448
|
|
|
|
|
|
|
|
25,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
293,533
|
|
|
|
364,131
|
|
|
|
665,807
|
|
|
|
(229,914
|
)
|
|
|
1,093,557
|
|
Property and equipment, net
|
|
|
85,758
|
|
|
|
2,231,110
|
|
|
|
2,265,457
|
|
|
|
|
|
|
|
4,582,325
|
|
Investment in subsidiaries
|
|
|
1,919,079
|
|
|
|
831,931
|
|
|
|
|
|
|
|
(2,751,010
|
)
|
|
|
|
|
Intercompany notes receivable
|
|
|
73,154
|
|
|
|
52,736
|
|
|
|
|
|
|
|
(125,890
|
)
|
|
|
|
|
Deferred financing costs, net
|
|
|
1,176
|
|
|
|
23,113
|
|
|
|
46,092
|
|
|
|
|
|
|
|
70,381
|
|
Restricted cash
|
|
|
|
|
|
|
328,556
|
|
|
|
226,576
|
|
|
|
|
|
|
|
555,132
|
|
Deferred income taxes
|
|
|
|
|
|
|
907
|
|
|
|
4,141
|
|
|
|
(5,048
|
)
|
|
|
|
|
Leasehold interest in land, net
|
|
|
|
|
|
|
|
|
|
|
801,195
|
|
|
|
|
|
|
|
801,195
|
|
Other assets, net
|
|
|
78
|
|
|
|
12,468
|
|
|
|
11,322
|
|
|
|
|
|
|
|
23,868
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
2,372,778
|
|
|
$
|
3,844,952
|
|
|
$
|
4,020,590
|
|
|
$
|
(3,111,862
|
)
|
|
$
|
7,126,458
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
884
|
|
|
$
|
26,749
|
|
|
$
|
23,405
|
|
|
$
|
|
|
|
$
|
51,038
|
|
Construction payables
|
|
|
674
|
|
|
|
67,068
|
|
|
|
261,633
|
|
|
|
|
|
|
|
329,375
|
|
Intercompany payables
|
|
|
|
|
|
|
43,261
|
|
|
|
186,587
|
|
|
|
(229,848
|
)
|
|
|
|
|
Accrued interest payable
|
|
|
5,977
|
|
|
|
763
|
|
|
|
1,756
|
|
|
|
|
|
|
|
8,496
|
|
Other accrued liabilities
|
|
|
13,231
|
|
|
|
138,312
|
|
|
|
167,358
|
|
|
|
|
|
|
|
318,901
|
|
Income taxes payable
|
|
|
20,352
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,352
|
|
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
66
|
|
|
|
(66
|
)
|
|
|
|
|
Current maturities of long-term
debt
|
|
|
|
|
|
|
1,800
|
|
|
|
4,686
|
|
|
|
|
|
|
|
6,486
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
41,118
|
|
|
|
277,953
|
|
|
|
645,491
|
|
|
|
(229,914
|
)
|
|
|
734,648
|
|
Other long-term liabilities
|
|
|
2,981
|
|
|
|
174,675
|
|
|
|
2,524
|
|
|
|
|
|
|
|
180,180
|
|
Intercompany notes payable
|
|
|
|
|
|
|
|
|
|
|
125,890
|
|
|
|
(125,890
|
)
|
|
|
|
|
Deferred income taxes
|
|
|
5,372
|
|
|
|
|
|
|
|
|
|
|
|
(5,048
|
)
|
|
|
324
|
|
Long-term debt
|
|
|
248,153
|
|
|
|
1,473,245
|
|
|
|
2,414,754
|
|
|
|
|
|
|
|
4,136,152
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
297,624
|
|
|
|
1,925,873
|
|
|
|
3,188,659
|
|
|
|
(360,852
|
)
|
|
|
5,051,304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders equity
|
|
|
2,075,154
|
|
|
|
1,919,079
|
|
|
|
831,931
|
|
|
|
(2,751,010
|
)
|
|
|
2,075,154
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders equity
|
|
$
|
2,372,778
|
|
|
$
|
3,844,952
|
|
|
$
|
4,020,590
|
|
|
$
|
(3,111,862
|
)
|
|
$
|
7,126,458
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
$
|
|
|
|
$
|
119,639
|
|
|
$
|
346,095
|
|
|
$
|
|
|
|
$
|
465,734
|
|
Rooms
|
|
|
|
|
|
|
96,086
|
|
|
|
1,782
|
|
|
|
|
|
|
|
97,868
|
|
Food and beverage
|
|
|
|
|
|
|
37,888
|
|
|
|
18,024
|
|
|
|
(1,553
|
)
|
|
|
54,359
|
|
Convention, retail and other
|
|
|
11,175
|
|
|
|
23,217
|
|
|
|
20,705
|
|
|
|
(12,051
|
)
|
|
|
43,046
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
|
11,175
|
|
|
|
276,830
|
|
|
|
386,606
|
|
|
|
(13,604
|
)
|
|
|
661,007
|
|
Less promotional
allowances
|
|
|
(212
|
)
|
|
|
(18,749
|
)
|
|
|
(13,828
|
)
|
|
|
|
|
|
|
(32,789
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
|
10,963
|
|
|
|
258,081
|
|
|
|
372,778
|
|
|
|
(13,604
|
)
|
|
|
628,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
|
|
|
|
|
52,080
|
|
|
|
226,704
|
|
|
|
(87
|
)
|
|
|
278,697
|
|
Rooms
|
|
|
|
|
|
|
22,428
|
|
|
|
96
|
|
|
|
|
|
|
|
22,524
|
|
Food and beverage
|
|
|
|
|
|
|
17,350
|
|
|
|
6,651
|
|
|
|
(368
|
)
|
|
|
23,633
|
|
Convention, retail and other
|
|
|
|
|
|
|
9,831
|
|
|
|
9,545
|
|
|
|
(1,945
|
)
|
|
|
17,431
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
15,611
|
|
|
|
(95
|
)
|
|
|
|
|
|
|
15,516
|
|
General and administrative
|
|
|
|
|
|
|
47,154
|
|
|
|
22,021
|
|
|
|
(11,204
|
)
|
|
|
57,971
|
|
Corporate expense
|
|
|
18,365
|
|
|
|
68
|
|
|
|
86
|
|
|
|
|
|
|
|
18,519
|
|
Rental expense
|
|
|
|
|
|
|
1,931
|
|
|
|
4,777
|
|
|
|
|
|
|
|
6,708
|
|
Pre-opening expense
|
|
|
|
|
|
|
1,102
|
|
|
|
21,355
|
|
|
|
|
|
|
|
22,457
|
|
Development expense
|
|
|
828
|
|
|
|
|
|
|
|
1,518
|
|
|
|
|
|
|
|
2,346
|
|
Depreciation and amortization
|
|
|
727
|
|
|
|
18,459
|
|
|
|
12,046
|
|
|
|
|
|
|
|
31,232
|
|
Loss on disposal of assets
|
|
|
|
|
|
|
168
|
|
|
|
10
|
|
|
|
|
|
|
|
178
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,920
|
|
|
|
186,182
|
|
|
|
304,714
|
|
|
|
(13,604
|
)
|
|
|
497,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(8,957
|
)
|
|
|
71,899
|
|
|
|
68,064
|
|
|
|
|
|
|
|
131,006
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
2,213
|
|
|
|
6,385
|
|
|
|
7,055
|
|
|
|
(2,989
|
)
|
|
|
12,664
|
|
Interest expense, net of amounts
capitalized
|
|
|
(3,222
|
)
|
|
|
(16,619
|
)
|
|
|
(17,760
|
)
|
|
|
2,989
|
|
|
|
(34,612
|
)
|
Other expense
|
|
|
(6
|
)
|
|
|
|
|
|
|
(7,027
|
)
|
|
|
|
|
|
|
(7,033
|
)
|
Income from equity investment in
subsidiaries
|
|
|
89,836
|
|
|
|
49,831
|
|
|
|
|
|
|
|
(139,667
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
79,864
|
|
|
|
111,496
|
|
|
|
50,332
|
|
|
|
(139,667
|
)
|
|
|
102,025
|
|
Benefit (provision) for income
taxes
|
|
|
11,050
|
|
|
|
(21,660
|
)
|
|
|
(501
|
)
|
|
|
|
|
|
|
(11,111
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
90,914
|
|
|
$
|
89,836
|
|
|
$
|
49,831
|
|
|
$
|
(139,667
|
)
|
|
$
|
90,914
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
$
|
|
|
|
$
|
97,136
|
|
|
$
|
278,246
|
|
|
$
|
|
|
|
$
|
375,382
|
|
Rooms
|
|
|
|
|
|
|
89,569
|
|
|
|
1,569
|
|
|
|
|
|
|
|
91,138
|
|
Food and beverage
|
|
|
|
|
|
|
41,946
|
|
|
|
11,088
|
|
|
|
(1,218
|
)
|
|
|
51,816
|
|
Convention, retail and other
|
|
|
6,597
|
|
|
|
12,347
|
|
|
|
23,061
|
|
|
|
(7,000
|
)
|
|
|
35,005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
|
6,597
|
|
|
|
240,998
|
|
|
|
313,964
|
|
|
|
(8,218
|
)
|
|
|
553,341
|
|
Less promotional
allowances
|
|
|
(190
|
)
|
|
|
(15,278
|
)
|
|
|
(7,509
|
)
|
|
|
|
|
|
|
(22,977
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
|
6,407
|
|
|
|
225,720
|
|
|
|
306,455
|
|
|
|
(8,218
|
)
|
|
|
530,364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
|
|
|
|
|
46,053
|
|
|
|
159,291
|
|
|
|
|
|
|
|
205,344
|
|
Rooms
|
|
|
|
|
|
|
21,715
|
|
|
|
38
|
|
|
|
|
|
|
|
21,753
|
|
Food and beverage
|
|
|
|
|
|
|
18,176
|
|
|
|
5,946
|
|
|
|
(65
|
)
|
|
|
24,057
|
|
Convention, retail and other
|
|
|
|
|
|
|
7,756
|
|
|
|
10,195
|
|
|
|
(1,556
|
)
|
|
|
16,395
|
|
Provision for doubtful accounts
|
|
|
|
|
|
|
4,739
|
|
|
|
250
|
|
|
|
|
|
|
|
4,989
|
|
General and administrative
|
|
|
|
|
|
|
41,981
|
|
|
|
19,428
|
|
|
|
(6,597
|
)
|
|
|
54,812
|
|
Corporate expense
|
|
|
12,825
|
|
|
|
|
|
|
|
129
|
|
|
|
|
|
|
|
12,954
|
|
Rental expense
|
|
|
|
|
|
|
3,316
|
|
|
|
391
|
|
|
|
|
|
|
|
3,707
|
|
Pre-opening expense
|
|
|
|
|
|
|
256
|
|
|
|
1,963
|
|
|
|
|
|
|
|
2,219
|
|
Development expense
|
|
|
340
|
|
|
|
|
|
|
|
8,828
|
|
|
|
|
|
|
|
9,168
|
|
Depreciation and amortization
|
|
|
516
|
|
|
|
15,942
|
|
|
|
8,547
|
|
|
|
|
|
|
|
25,005
|
|
Loss on disposal of assets
|
|
|
|
|
|
|
12
|
|
|
|
1,069
|
|
|
|
|
|
|
|
1,081
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,681
|
|
|
|
159,946
|
|
|
|
216,075
|
|
|
|
(8,218
|
)
|
|
|
381,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(7,274
|
)
|
|
|
65,774
|
|
|
|
90,380
|
|
|
|
|
|
|
|
148,880
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
3,696
|
|
|
|
7,084
|
|
|
|
985
|
|
|
|
(1,551
|
)
|
|
|
10,214
|
|
Interest expense, net of amounts
capitalized
|
|
|
(445
|
)
|
|
|
(16,695
|
)
|
|
|
(5,826
|
)
|
|
|
1,551
|
|
|
|
(21,415
|
)
|
Other income
|
|
|
|
|
|
|
156
|
|
|
|
8
|
|
|
|
|
|
|
|
164
|
|
Income from equity investment in
subsidiaries
|
|
|
120,852
|
|
|
|
84,574
|
|
|
|
|
|
|
|
(205,426
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
116,829
|
|
|
|
140,893
|
|
|
|
85,547
|
|
|
|
(205,426
|
)
|
|
|
137,843
|
|
Benefit (provision) for income
taxes
|
|
|
4,954
|
|
|
|
(20,041
|
)
|
|
|
(973
|
)
|
|
|
|
|
|
|
(16,060
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
121,783
|
|
|
$
|
120,852
|
|
|
$
|
84,574
|
|
|
$
|
(205,426
|
)
|
|
$
|
121,783
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Net cash provided by (used in)
operating activities
|
|
$
|
(34,188
|
)
|
|
$
|
75,463
|
|
|
$
|
10,076
|
|
|
$
|
|
|
|
$
|
51,351
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in restricted cash
|
|
|
(407
|
)
|
|
|
116,370
|
|
|
|
282,608
|
|
|
|
|
|
|
|
398,571
|
|
Capital expenditures
|
|
|
(46,455
|
)
|
|
|
(185,121
|
)
|
|
|
(533,388
|
)
|
|
|
|
|
|
|
(764,964
|
)
|
Intercompany receivable from
Non-Guarantor Subsidiaries
|
|
|
(11,069
|
)
|
|
|
(21,364
|
)
|
|
|
|
|
|
|
32,433
|
|
|
|
|
|
Intercompany receivable from
Guarantor Subsidiaries
|
|
|
(37,000
|
)
|
|
|
|
|
|
|
|
|
|
|
37,000
|
|
|
|
|
|
Repayment of receivable from
Non-Guarantor Subsidiaries
|
|
|
104,464
|
|
|
|
|
|
|
|
|
|
|
|
(104,464
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in)
investing activities
|
|
|
9,533
|
|
|
|
(90,115
|
)
|
|
|
(250,780
|
)
|
|
|
(35,031
|
)
|
|
|
(366,393
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from exercise of stock
options
|
|
|
9,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,983
|
|
Tax benefit from stock option
exercises
|
|
|
2,293
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,293
|
|
Borrowings from Las Vegas Sands
Corp.
|
|
|
|
|
|
|
37,000
|
|
|
|
11,069
|
|
|
|
(48,069
|
)
|
|
|
|
|
Repayment on borrowings from Las
Vegas Sands Corp.
|
|
|
|
|
|
|
|
|
|
|
(104,464
|
)
|
|
|
104,464
|
|
|
|
|
|
Borrowings from Guarantor
Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
21,364
|
|
|
|
(21,364
|
)
|
|
|
|
|
Proceeds from Macao credit facility
|
|
|
|
|
|
|
|
|
|
|
85,000
|
|
|
|
|
|
|
|
85,000
|
|
Proceeds from Singapore credit
facility
|
|
|
|
|
|
|
|
|
|
|
110,777
|
|
|
|
|
|
|
|
110,777
|
|
Proceeds from airplane financings
|
|
|
72,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
72,000
|
|
Proceeds from senior secured credit
facility revolver
|
|
|
|
|
|
|
62,000
|
|
|
|
|
|
|
|
|
|
|
|
62,000
|
|
Proceeds from Phase II mall
construction loan
|
|
|
|
|
|
|
|
|
|
|
35,000
|
|
|
|
|
|
|
|
35,000
|
|
Proceeds on FF&E credit
facility and other long-term debt
|
|
|
|
|
|
|
|
|
|
|
6,082
|
|
|
|
|
|
|
|
6,082
|
|
Repayment on senior secured credit
facility revolver
|
|
|
|
|
|
|
(99,000
|
)
|
|
|
|
|
|
|
|
|
|
|
(99,000
|
)
|
Repayments on The Sands Expo Center
mortgage loan
|
|
|
|
|
|
|
|
|
|
|
(535
|
)
|
|
|
|
|
|
|
(535
|
)
|
Repayments on FF&E credit
facility and other long-term debt
|
|
|
|
|
|
|
(600
|
)
|
|
|
(5
|
)
|
|
|
|
|
|
|
(605
|
)
|
Payments of deferred financing costs
|
|
|
(375
|
)
|
|
|
|
|
|
|
(909
|
)
|
|
|
|
|
|
|
(1,284
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in)
financing activities
|
|
|
83,901
|
|
|
|
(600
|
)
|
|
|
163,379
|
|
|
|
35,031
|
|
|
|
281,711
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange rate on
cash
|
|
|
|
|
|
|
|
|
|
|
4,790
|
|
|
|
|
|
|
|
4,790
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash and
cash equivalents
|
|
|
59,246
|
|
|
|
(15,252
|
)
|
|
|
(72,535
|
)
|
|
|
|
|
|
|
(28,541
|
)
|
Cash and cash equivalents at
beginning of period
|
|
|
69,100
|
|
|
|
84,581
|
|
|
|
314,385
|
|
|
|
|
|
|
|
468,066
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of
period
|
|
$
|
128,346
|
|
|
$
|
69,329
|
|
|
$
|
241,850
|
|
|
$
|
|
|
|
$
|
439,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (Continued)
CONDENSED
CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
|
|
|
Consolidating/
|
|
|
|
|
|
|
Las Vegas
|
|
|
Guarantor
|
|
|
Guarantor
|
|
|
Eliminating
|
|
|
|
|
|
|
Sands Corp.
|
|
|
Subsidiaries
|
|
|
Subsidiaries
|
|
|
Entries
|
|
|
Total
|
|
|
Net cash provided by (used in)
operating activities
|
|
$
|
(19,426
|
)
|
|
$
|
55,386
|
|
|
$
|
109,866
|
|
|
$
|
|
|
|
$
|
145,826
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in restricted cash
|
|
|
(469
|
)
|
|
|
(6,279
|
)
|
|
|
(41,038
|
)
|
|
|
|
|
|
|
(47,786
|
)
|
Capital expenditures
|
|
|
(35
|
)
|
|
|
(84,818
|
)
|
|
|
(209,380
|
)
|
|
|
|
|
|
|
(294,233
|
)
|
Notes receivable from subsidiaries
|
|
|
(66,435
|
)
|
|
|
|
|
|
|
|
|
|
|
66,435
|
|
|
|
|
|
Intercompany receivables from
subsidiaries
|
|
|
(39,818
|
)
|
|
|
(56,460
|
)
|
|
|
|
|
|
|
96,278
|
|
|
|
|
|
Capital contributions to
subsidiaries
|
|
|
(6,456
|
)
|
|
|
(8,649
|
)
|
|
|
|
|
|
|
15,105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing
activities
|
|
|
(113,213
|
)
|
|
|
(156,206
|
)
|
|
|
(250,418
|
)
|
|
|
177,818
|
|
|
|
(342,019
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from exercise of stock
options
|
|
|
1,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,864
|
|
Tax benefit from stock option
exercises
|
|
|
632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
632
|
|
Capital contributions received
|
|
|
|
|
|
|
6,456
|
|
|
|
8,649
|
|
|
|
(15,105
|
)
|
|
|
|
|
Borrowings from Las Vegas Sands
Corp.
|
|
|
|
|
|
|
|
|
|
|
66,435
|
|
|
|
(66,435
|
)
|
|
|
|
|
Proceeds from senior secured
credit facility revolver
|
|
|
|
|
|
|
92,129
|
|
|
|
|
|
|
|
|
|
|
|
92,129
|
|
Proceeds from Phase II mall
construction loan
|
|
|
|
|
|
|
|
|
|
|
14,000
|
|
|
|
|
|
|
|
14,000
|
|
Proceeds from other long-term debt
|
|
|
|
|
|
|
|
|
|
|
75
|
|
|
|
|
|
|
|
75
|
|
Repayments on Venetian
Intermediate credit facility
|
|
|
|
|
|
|
|
|
|
|
(50,000
|
)
|
|
|
|
|
|
|
(50,000
|
)
|
Repayments on FF&E credit
facility
|
|
|
|
|
|
|
(1,200
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,200
|
)
|
Repayments on The Sands Expo
Center mortgage loan
|
|
|
|
|
|
|
|
|
|
|
(951
|
)
|
|
|
|
|
|
|
(951
|
)
|
Net change in intercompany accounts
|
|
|
|
|
|
|
2,818
|
|
|
|
93,460
|
|
|
|
(96,278
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing
activities
|
|
|
2,496
|
|
|
|
100,203
|
|
|
|
131,668
|
|
|
|
(177,818
|
)
|
|
|
56,549
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange rate on
cash
|
|
|
|
|
|
|
|
|
|
|
75
|
|
|
|
|
|
|
|
75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Decrease in cash and cash
equivalents
|
|
|
(130,143
|
)
|
|
|
(617
|
)
|
|
|
(8,809
|
)
|
|
|
|
|
|
|
(139,569
|
)
|
Cash and cash equivalents at
beginning of period
|
|
|
202,196
|
|
|
|
87,173
|
|
|
|
167,477
|
|
|
|
|
|
|
|
456,846
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end
of period
|
|
$
|
72,053
|
|
|
$
|
86,556
|
|
|
$
|
158,668
|
|
|
$
|
|
|
|
$
|
317,277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20
LAS VEGAS
SANDS CORP. AND SUBSIDIARIES
|
|
ITEM 2
|
MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
The following discussion should be read in conjunction with, and
is qualified in its entirety by, the condensed consolidated
financial statements, and the notes thereto and other financial
information included in this
Form 10-Q.
Certain statements in this Managements Discussion
and Analysis of Financial Condition and Results of
Operations are forward-looking statements. See
Special Note Regarding Forward-Looking
Statements.
Operations
We own and operate The Venetian Resort Hotel Casino (The
Venetian), a Renaissance Venice-themed resort situated on
the Las Vegas Strip (the Strip). The Venetian
includes the first all-suites hotel on the Strip with 4,027
suites; a gaming facility of approximately 120,000 gross
square feet; an enclosed retail, dining and entertainment
complex of approximately 440,000 net leasable square feet
(The Grand Canal Shops), which was sold to a third
party in 2004; and a meeting and conference facility of
approximately 1.1 million square feet (the Congress
Center). A subsidiary of Las Vegas Sands Corp. owns and
operates an expo and convention center with approximately
1.2 million square feet (The Sands Expo
Center), which is connected to The Venetian and the
Congress Center. Approximately 43.0% of our gross revenue at The
Venetian for the three months ended March 31, 2007 was
derived from gaming and 57.0% was derived from hotel rooms, food
and beverage, and other sources. The percentage of non-gaming
revenue for The Venetian reflects the resorts emphasis on
the group convention and trade show business and the resulting
higher occupancy and room rates during mid-week periods.
We also own and operate the Sands Macao Casino (the Sands
Macao), a Las Vegas-style casino in Macao, China, which
opened in May 2004. The Sands Macao now offers over
229,000 square feet of gaming facilities after our
expansion, which was completed in August 2006, as well as
several restaurants, VIP facilities, a theater and other
high-end amenities. In addition, we continue to progress
according to plan on our expansion of the hotel tower, which we
expect to be completed in September 2007 and to cost
approximately $100.0 million. Approximately 95.0% of the
Sands Macaos gross revenue for the three months ended
March 31, 2007 was derived from gaming activities, with the
remainder primarily derived from food and beverage services.
United
States Development Projects
The
Palazzo
We are currently constructing The Palazzo Resort Hotel Casino
(The Palazzo), a second resort similar in size to
The Venetian, which is situated on a
14-acre site
next to The Venetian and The Sands Expo Center. The Palazzo will
consist of an all-suites, 50-floor luxury hotel tower with
approximately 3,068 suites, a gaming facility of approximately
105,000 square feet and an enclosed shopping, dining and
entertainment complex of approximately 400,000 net leasable
square feet (the Phase II mall), which we have
contracted to sell to a third party. The Palazzo is expected to
open in late 2007 at a cost estimated to be approximately
$2.10 billion, of which the Phase II mall is expected
to cost approximately $508.0 million (exclusive of certain
incentive payments to executives made in July 2004 and inclusive
of $140.0 million of additional costs for structural
enhancements relating to the development of the high-rise
condominium tower). In addition, we expect that additional
capital expenditures will be required to build out stores and
restaurants to be located in the Phase II mall. In
connection with the sale of The Grand Canal Shops, we entered
into an agreement with General Growth Partners
(GGP), the purchaser of The Grand Canal Shops, to
sell GGP the Phase II mall upon completion of construction.
The ultimate purchase price that GGP has agreed to pay for the
Phase II mall is the greater of
(i) $250.0 million and (ii) the Phase II
malls net operating income for months 19 through 30 of its
operations divided by a capitalization rate. The capitalization
rate is 6.0% on the first $38.0 million of net operating
income and 8.0% on the net operating income above
$38.0 million.
We are in the early stages of constructing a high-rise
residential condominium tower which will consist of
approximately 300 luxury condominiums and will be situated
between The Palazzo and The Venetian. The condominium tower is
currently expected to open in late fall 2008 at an estimated
cost of approximately $465.0 million.
21
Sands
Bethworks
On December 20, 2006, the Pennsylvania Gaming Control Board
announced that our indirect majority-owned subsidiary, Sands
Bethworks Gaming, LLC (Sands Bethworks Gaming), had
been awarded a Pennsylvania gaming license. Sands Bethworks
Gaming is a project venture in which we effectively own 86% of
the economic interest. The issuance of the license is subject to
appeals and the actual license will be issued once the appeal
period ends. We are in the process of developing a gaming,
hotel, shopping and dining complex (the Sands
Bethworks) located on the site of the Historic Bethlehem
Steel Works in Bethlehem, Pennsylvania, which is about
70 miles from midtown Manhattan, New York. In its first
phase, the
126-acre
development is expected to feature a 300-room hotel,
200,000 square feet of retail space, 3,000 slot machines, a
50,000 square foot multipurpose event center and a variety
of dining options. We expect to add an additional 2,000 slot
machines in a subsequent phase. We currently expect the cost to
develop and construct the Sands Bethworks will be approximately
$635.0 million and expect the complex to open in late 2008.
Macao
Development Projects
We are building The Venetian Macao Resort Hotel Casino
(The Venetian Macao) on the Cotai
StripTM
in Macao, China. The Venetian Macao will be an approximately
3,000 all-suites hotel, casino and convention center complex
with a Venetian-style theme similar to that of The Venetian in
Las Vegas. Under our gaming subconcession in Macao, we are
obligated to develop and open The Venetian Macao and a
convention center by December 2007. We currently expect to open
The Venetian Macao in late August 2007. If we fail to meet the
December 2007 deadline and that deadline is not extended, we
could lose our right to continue to operate the Sands Macao or
any other facilities developed under our Macao gaming
subconcession, and our investment to date in The Venetian Macao
could be lost.
In addition to the development of The Venetian Macao, we are
developing multiple other properties on the Cotai Strip. We have
submitted development plans to the Macao government for six
casino-resort developments in addition to The Venetian Macao on
an area of approximately 200 acres located on the Cotai
Strip (which we refer to as parcels 2, 3, 5, 6, 7 and
8). The developments are expected to include hotels, exhibition
and conference facilities, casinos, showrooms, shopping malls,
spas, world-class restaurants, entertainment facilities and
other attractions and amenities, as well as common public areas.
We have commenced construction or pre-construction on all seven
parcels of the Cotai Strip. We plan to own and operate all of
the casinos in these developments under our Macao gaming
subconcession. More specifically, the Company intends to develop
its other Cotai Strip properties as follows:
|
|
|
|
|
Parcel 2 is intended to be a Four Seasons hotel and casino,
which will be adjacent to The Venetian Macao and is expected to
be a boutique hotel with approximately 400 luxury hotel rooms,
approximately 800,000 square feet of Four Seasons-serviced
luxury apartments, distinctive dining experiences, a full
service spa and other amenities, an approximately
45,000 square foot casino and approximately
210,000 square feet of upscale retail offerings. The
Company will own the entire development. The Company has entered
into an exclusive non-binding letter of intent and is currently
negotiating definitive agreements under which Four Seasons
Hotels Inc. will manage the hotel and serviced luxury apartments
under its Four Seasons brand.
|
|
|
|
Parcel 5 is intended to include a three-hotel complex with
approximately 2,450 luxury and mid-scale hotel rooms, serviced
luxury apartments, a casino and a retail shopping mall. The
Company will own the entire development and has entered into a
management agreement with Shangri-La Hotels and Resorts to
manage two hotels under its Shangri-La and Traders brands.
In addition, the Company has entered into a management agreement
with Starwood Hotels & Resorts Worldwide to manage a
hotel and serviced luxury apartments under its St. Regis brand.
|
|
|
|
Parcel 6 is intended to include a two-hotel complex with
approximately 4,000 luxury and mid-scale hotel rooms, a casino
and a retail shopping mall physically connected to the mall in
the Shangri-La/Traders hotel podium. The Company will own the
entire development and has entered into a management agreement
with Starwood Hotels & Resorts Worldwide to manage the
hotels under its Sheraton brand.
|
22
|
|
|
|
|
Parcels 7 and 8 are intended to each include a two-hotel complex
with approximately 3,000 luxury and mid-scale hotel rooms on
each parcel, serviced luxury vacation suites, a casino and
retail shopping malls that are physically connected. The Company
will own the entire development and has entered into non-binding
agreements with Hilton Hotels to manage Hilton and Conrad brand
hotels and serviced luxury vacation suites on parcel 7 and
Fairmont Raffles Holdings to manage Fairmont and Raffles brand
hotel complexes and serviced luxury vacation suites on parcel 8.
The Company is currently negotiating definitive agreements with
Hilton Hotels and Fairmont Raffles Holdings.
|
|
|
|
For parcel 3, the Company has signed a non-binding
memorandum of agreement with an independent developer. The
Company is currently negotiating the definitive agreement
pursuant to which it will partner with this developer to build a
multi-hotel complex, which may include a Cosmopolitan hotel. In
addition, the Company has signed a non-binding letter of intent
with Intercontinental Hotels Group to manage hotels under the
Intercontinental and Holiday Inn International brands, and
serviced luxury vacation suites under the Intercontinental
brand, on the site. The Company is currently negotiating
definitive agreements with Intercontinental Hotels Group. In
total, the multi-hotel complex is intended to include
approximately 3,600 hotel rooms, serviced luxury vacation
suites, a casino and a retail shopping mall.
|
The casino at The Venetian Macao is currently planned to have
approximately 850 table games and 4,100 slot machines when it
opens in late August 2007, and is designed to have a final
capacity of approximately 1,150 table games and 7,000 slot
machines. The Four Seasons resort is currently planned to
feature approximately 130 table games and 400 slot machines. The
casinos on parcels 3, 5, 6, 7 and 8 are each currently
planned to include approximately 325 table games and 1,750 slot
machines. Upon completion, our developments on the Cotai Strip
are currently planned to feature total gaming capacity of
approximately 2,900 table games and 16,000 slot machines.
In February 2007, we received the final draft of the land
concession agreement from the Macao government pursuant to which
we were awarded a concession by lease for parcels 1, 2 and
3 on the Cotai Strip, including the sites on which we are
building The Venetian Macao (parcel 1) and the Four Seasons
hotel (parcel 2). We have accepted the conditions of the draft
land concession and have made an initial premium payment of
853.0 million patacas ($105.9 million at exchange
rates in effect on March 31, 2007) towards the
aggregate land premium of 2.59 billion patacas
($322.0 million at exchange rates in effect on
March 31, 2007). Additionally, we received a credit in the
amount of 193.4 million patacas ($24.0 million at
exchange rates in effect on March 31, 2007) towards
the aggregate land premium related to reclamation work and other
works done on the land and the installation costs of an
electrical substation. Each parcels share of the remaining
balance will be either due upon completion of the corresponding
resort or be payable through seven semi-annual payments to be
made over a four year period and bearing interest at 5%,
whichever comes first. On April 18, 2007, the land
concession became effective when it was published in
Macaos Official Gazette. Now that the land concession is
effective, we will be required to make land premium and annual
rent payments relating to parcels 1, 2 and 3 in the amounts
and at the times specified in the land concession.
We currently estimate that the cost of developing and building
The Venetian Macao will be approximately $2.4 billion
(exclusive of the aggregate land concession payment of
$322.0 million for parcels 1, 2 and 3). Our
subsidiary, Venetian Macau Limited and its subsidiaries
(collectively VML), obtained a $2.5 billion
credit facility to fund the Sands Macao expansion and to
partially fund the design, development, construction and
pre-opening costs for The Venetian Macao, the Four Seasons hotel
and some of our other development projects on the Cotai Strip,
and to pay related fees and expenses. In March 2007, this credit
facility was amended to expand the use of proceeds and remove
certain restrictive conditions. In April 2007, we exercised our
rights under this facilities to access the $800.0 million of
incremental facilities under the accordion feature set forth
therein, which increased the total credit facility to $3.3
billion. Currently, we expect the total cost of development on
the Cotai Strip to be in the range of $9.0 billion to
$11.0 billion. We will need to arrange additional debt
financing to finance those costs as well and there is no
assurance that we will be able to obtain this additional debt
financing.
We do not yet have all the necessary Macao government approvals
that we will need in order to develop the Cotai Strip
developments. We have commenced construction on our other Cotai
Strip properties on land for which we have not yet been granted
land concessions. If we do not obtain land concessions, we could
lose all or a
23
substantial part of our investment in these other Cotai Strip
properties. As of March 31, 2007, we have capitalized
approximately $162.8 million of construction costs related
to our other Cotai Strip properties.
Hengqin
Island Development Project
We have entered into a non-binding letter of intent with the
Zhuhai Municipal Peoples Government of the Peoples
Republic of China to work with it to create a master plan for,
and develop, a leisure and convention destination resort on
Hengqin Island, located approximately one mile from the Cotai
Strip, but within mainland China. We are actively preparing
preliminary design concepts for presentation to the government.
On January 10, 2007, the Zhuhai Government established a
Project Coordination Committee to act as a government liaison
empowered to work directly with the Company to advance the
development of the project. We have interfaced with this
committee and are actively working with the committee as we
continue to advance our plans. The project remains subject to a
number of conditions, including further governmental approvals.
Singapore
Development Project
In August 2006, our wholly-owned subsidiary, Marina Bay Sands
Pte. Ltd (MBS), entered into a development agreement
(the Development Agreement) with the Singapore
Tourism Board (STB) to build and operate an
integrated resort called The Marina Bay Sands in Singapore. The
Marina Bay Sands will be a large integrated resort that includes
three 50+ story hotel towers (totaling approximately 2,500
suites), a casino, an enclosed retail, dining and entertainment
complex with approximately 1.0 million net leasable square
feet, a convention center and meeting room complex of
approximately 1.2 million square feet, theaters, and a
landmark iconic structure at the bay-front promenade that
contains an art/science museum. We expect the cost to develop
and construct The Marina Bay Sands integrated resort will be
approximately $3.6 billion, inclusive of the land premium,
taxes and other fees discussed above. The Marina Bay Sands is
expected to open in 2009.
United
Kingdom Development Projects
In December 2006, we announced that one of our affiliates and
Cantor Gaming, an affiliate of the global financial services
company Cantor Fitzgerald, have agreed to launch an online
casino and poker site initially aimed at serving the United
Kingdom market. Cantor Gaming will provide an online casino and
poker destination featuring the Companys brands. The site
will offer casino games, including blackjack, roulette,
baccarat, video poker, slots and online poker. The offering will
be part of a full end-to-end gaming service, including customer
age and location verification, online payment processing and
customer services. The site is expected to be launched during
the second half of 2007. The site will be hosted, and the
operator will be licensed, in compliance with the laws of
Alderney, British Channel Islands. It will not accept
U.S. customers.
The United Kingdom government recently announced that the
approval for the countrys first regional super casino had
been rescinded. Should the government approve an alternative
super casino site, we intend to evaluate the efficacy of
participating in the tender process for that site. In addition,
we have existing agreements to develop and lease gaming and
entertainment facilities with Sheffield United and Glasgow
Rangers football clubs in the United Kingdom. Our ability to
eventually develop and lease gaming and entertainment facilities
under these agreements is subject to a number of conditions,
including the passage of legislation to expand the number of
authorized regional casinos and our ability to obtain a gaming
license.
Other
Development Projects
We are currently exploring the possibility of operating
integrated resorts in additional Asian jurisdictions, the United
States and Europe.
Critical
Accounting Policies and Estimates
The preparation of our condensed consolidated financial
statements in conformity with accounting principles generally
accepted in the United States of America requires our management
to make estimates and judgments that affect the reported amounts
of assets and liabilities, revenues and expenses, and related
disclosures of contingent assets and liabilities. These
estimates are based on historical information, information that
is currently available to
24
us and on various other assumptions that management believes to
be reasonable under the circumstances. Actual results could vary
from those estimates and we may change our estimates and
assumptions in future evaluations. Changes in these estimates
and assumptions may have a material effect on our results of
operations and financial condition. We believe that the critical
accounting policies discussed below affect our more significant
judgments and estimates used in the preparation of our condensed
consolidated financial statements. For a discussion of our
significant accounting policies and estimates, please refer to
Managements Discussion and Analysis of Financial Condition
and Results of Operations and Notes to Consolidated Financial
Statements presented in our 2006 Annual Report on
Form 10-K
filed on February 28, 2007.
There were no newly identified significant accounting estimates
in the three months ended March 31, 2007, nor were there
any material changes to the critical accounting policies and
estimates discussed in our 2006 Annual Report, with the
exception of the adoption of Financial Accounting Standard Board
issued Interpretation (FIN) No. 48,
Accounting for Uncertainty in Income Taxes, which is
described below.
Income
Taxes
We are subject to income taxes in the United States, and in
several states and foreign jurisdictions in which we operate. We
account for income taxes in accordance with Statement of
Financial Accounting Standards (SFAS) No. 109,
Accounting for Income Taxes. Under
SFAS No. 109, deferred tax assets and liabilities are
recognized based on differences between financial statement and
tax basis of assets and liabilities using enacted tax rates.
SFAS No. 109 requires the recognition of deferred tax
assets, net of any applicable valuation allowances, related to
net operating loss carryforwards, tax credits and other
temporary differences. The standard requires recognition of a
future tax benefit to the extent that realization of such
benefit is more likely than not; otherwise, a valuation
allowance is applied.
Our income tax returns are subject to examination by the
Internal Revenue Service (IRS) and other tax
authorities. While positions taken in tax returns are sometimes
subject to uncertainty in the tax laws, we do not take such
positions unless we have substantial authority to do
so under the Internal Revenue Code and applicable regulations.
We may take positions on our tax returns based on substantial
authority that are not ultimately accepted by the IRS. We are
subject to income tax examination by tax authorities for years
after 2002. There are currently no income tax returns being
examined by the IRS or other major tax authorities.
The Company adopted the provisions of FIN No. 48 on
January 1, 2007. As a result of the implementation of
FIN No. 48, the Company recognized a $4.1 million
increase in the liability for unrecognized tax benefits, which
was accounted for as a reduction to opening retained earnings.
At the adoption date of January 1, 2007, the Company had
$8.5 million of unrecognized tax benefits, of which
$6.1 million would affect the effective income tax rate if
recognized.
Recent
Accounting Pronouncements
See related disclosure at Item 1
Financial Statements Notes to Condensed Consolidated
Financial Statements Note 1
Organization and Business of Company.
Summary
Financial Results
The following table summarizes our results of operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
2007
|
|
|
2006
|
|
|
Change
|
|
|
|
(in thousands, except for percentages)
|
|
|
Net revenues
|
|
$
|
628,218
|
|
|
$
|
530,364
|
|
|
|
18.5
|
%
|
Operating expenses
|
|
|
497,212
|
|
|
|
381,484
|
|
|
|
30.3
|
%
|
Operating income
|
|
|
131,006
|
|
|
|
148,880
|
|
|
|
(12.0
|
)%
|
Income before income taxes
|
|
|
102,025
|
|
|
|
137,843
|
|
|
|
(26.0
|
)%
|
Net income
|
|
|
90,914
|
|
|
|
121,783
|
|
|
|
(25.3
|
)%
|
25
|
|
|
|
|
|
|
|
|
|
|
Percent of Net Revenues
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Operating expenses
|
|
|
79.1
|
%
|
|
|
71.9
|
%
|
Operating income
|
|
|
20.9
|
%
|
|
|
28.1
|
%
|
Income before income taxes
|
|
|
16.2
|
%
|
|
|
26.0
|
%
|
Net income
|
|
|
14.5
|
%
|
|
|
23.0
|
%
|
Operating
Results
Key
operating revenue measurements
The Venetians operating revenue is dependent upon the
volume of customers who stay at the hotel, which affects the
price that can be charged for hotel rooms and the volume of
table games and slot machine play. The Sands Macao is almost
wholly dependent on casino customers that visit the casino on a
daily basis. Hotel revenues are not material for the Sands
Macao. Visitors to the Sands Macao arrive by ferry, automobile,
bus, airplane or helicopter from Hong Kong, cities in China, and
other Southeast Asian cities in close proximity to Macao and
elsewhere.
The following are the key measurements we use to evaluate
operating revenue:
Casino revenue measurements for Las
Vegas: Table games drop and slot handle are
volume measurements. Win or hold percentage represents the
percentage of drop or handle that is won by the casino and
recorded as casino revenue. Table games drop represents the sum
of markers issued (credit instruments) less markers paid at the
table, plus cash deposited in the table drop box. Slot handle is
the gross amount wagered or coin placed into slot machines in
aggregate for the period cited. Drop and handle are
abbreviations for table games drop and slot handle. Based upon
our mix of table games, our table games produce a statistical
average table win percentage (calculated before discounts) as
measured as a percentage of table game drop of 20.0% to 22.0%
and slot machines produce a statistical average slot machine win
percentage (calculated before slot club cash incentives) as
measured as a percentage of slot machine handle generally
between 6.0% and 7.0%.
Casino revenue measurements for Macao: We view
Macao table games as being segregated into two groups,
consistent with the Macao markets convention: Rolling Chip
play (all VIP play) and Non-Rolling Chip play (mostly non-VIP
players). The volume measurement for Rolling Chip play is
non-negotiable gaming chips wagered. The volume measurement for
Non-Rolling Chip play is table games drop as described above.
Rolling Chip volume and Non-Rolling Chip volume are not
equivalent because Rolling Chip volume is a measure of amounts
wagered versus dropped and therefore Rolling Chip volume is
substantially higher than drop. Slot handle at the Sands Macao
is the gross amount wagered or coins placed into slot machines
in aggregate for the period cited.
We view Rolling Chip table games win as a percentage of Rolling
Chip volume and we view Non-Rolling Chip table games win as a
percentage of drop. Win or hold percentage represents the
percentage of Rolling Chip volume, Non-Rolling Chip drop or slot
handle that is won by the casino and recorded as casino revenue.
Based upon our mix of table games in Macao, our Rolling Chip
table games win percentage (calculated before discounts and
commissions) as measured as a percentage of Rolling Chip volume
is expected to be 2.7% to 3.0% and our Non-Rolling Chip table
games are expected to produce a statistical average table win
percentage as measured as a percentage of table game drop
(before discounts and commissions) of 18.0% to 20.0%. Similar to
Las Vegas, our Macao slot machines produce a statistical average
slot machine win percentage as measured as a percentage of slot
machine handle of generally between 6.0% and 7.0%.
Actual win may vary from the statistical average. Generally,
slot machine play at The Venetian and Sands Macao is conducted
on a cash basis, The Venetians table games revenue is
approximately 63.7% from credit based guests wagering for the
three months ended March 31, 2007 and the Sands
Macaos table game play is conducted primarily on a cash
basis.
Hotel revenue measurements: Hotel occupancy
rate, which is the average percentage of available hotel rooms
occupied during a period, and average daily room rate, which is
the average price of occupied rooms per day, are used as
performance indicators. Revenue per available room represents a
summary of hotel average daily room
26
rates and occupancy. Because not all available rooms are
occupied, average daily room rates are higher than revenue per
available room.
Three
Months Ended March 31, 2007 compared to the Three Months
Ended March 31, 2006
Operating
Revenues
Our net revenues consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
2007
|
|
|
2006
|
|
|
Change
|
|
|
|
(In thousands, except for percentages)
|
|
|
Net Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
$
|
465,734
|
|
|
$
|
375,382
|
|
|
|
24.1
|
%
|
Rooms
|
|
|
97,868
|
|
|
|
91,138
|
|
|
|
7.4
|
%
|
Food and beverage
|
|
|
54,359
|
|
|
|
51,816
|
|
|
|
4.9
|
%
|
Convention, retail and other
|
|
|
43,046
|
|
|
|
35,005
|
|
|
|
23.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
661,007
|
|
|
|
553,341
|
|
|
|
19.5
|
%
|
Less promotional
allowances
|
|
|
(32,789
|
)
|
|
|
(22,977
|
)
|
|
|
(42.7
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
|
|
$
|
628,218
|
|
|
$
|
530,364
|
|
|
|
18.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated net revenues were $628.2 million for the three
months ended March 31, 2007, an increase of
$97.8 million compared to $530.4 million for the three
months ended March 31, 2006. The increase in net revenues
was due primarily to an increase in casino revenue of
$90.4 million.
Casino revenues for the three months ended March 31, 2007
increased $90.4 million as compared to the three months
ended March 31, 2006. Of the increase, $67.9 million
was attributable to the growth of our casino operations at the
Sands Macao due primarily to the Rolling Chip program which
generated an increase in Rolling Chip volume of
$3.16 billion and an increase in win percentage of
0.3 percentage points as compared to the three months ended
March 31, 2006, and a $22.5 million increase primarily
attributable to an increased win percentage of
7.0 percentage points at The Venetian as compared to the
three months ended March 31, 2006. The following table
summarizes the results of our casino activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Change
|
|
|
|
(In thousands, except for percentages)
|
|
|
Sands Macao
|
|
|
|
|
|
|
|
|
|
|
|
|
Total casino revenues
|
|
$
|
346,095
|
|
|
$
|
278,246
|
|
|
|
24.4
|
%
|
Non-Rolling Chip table games drop
|
|
$
|
1,037,012
|
|
|
$
|
1,058,993
|
|
|
|
(2.1
|
)%
|
Non-Rolling Chip table games win
percentage
|
|
|
18.6
|
%
|
|
|
18.6
|
%
|
|
|
|
|
Rolling Chip volume
|
|
$
|
6,856,990
|
|
|
$
|
3,696,214
|
|
|
|
85.5
|
%
|
Rolling Chip win percentage
|
|
|
2.8
|
%
|
|
|
2.5
|
%
|
|
|
0.3
|
pts
|
Slot handle
|
|
$
|
297,095
|
|
|
$
|
247,048
|
|
|
|
20.3
|
%
|
Slot hold percentage
|
|
|
7.3
|
%
|
|
|
7.8
|
%
|
|
|
(0.5
|
)pts
|
The Venetian
|
|
|
|
|
|
|
|
|
|
|
|
|
Total casino revenues
|
|
$
|
119,639
|
|
|
$
|
97,136
|
|
|
|
23.2
|
%
|
Table games drop
|
|
$
|
353,128
|
|
|
$
|
363,458
|
|
|
|
(2.8
|
)%
|
Table games win percentage
|
|
|
29.1
|
%
|
|
|
22.1
|
%
|
|
|
7.0
|
pts
|
Slot handle
|
|
$
|
588,444
|
|
|
$
|
529,458
|
|
|
|
11.1
|
%
|
Slot hold percentage
|
|
|
6.0
|
%
|
|
|
6.3
|
%
|
|
|
(0.3
|
)pts
|
27
In our experience, average win percentages remain steady when
measured over extended periods of time, but can vary
considerably within shorter time periods as a result of the
statistical variances that are associated with games of chance
in which large amounts are wagered.
Room revenues for the three months ended March 31, 2007
increased $6.7 million as compared to the three months
ended March 31, 2006. The increase was attributable
primarily to the increase in average daily room rate, offset
slightly by a decrease in the occupancy rate. The following
table summarizes the results of our room revenue activity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
Change
|
|
|
The Venetian
|
|
|
|
|
|
|
|
|
|
|
|
|
Average daily room rate
|
|
$
|
276
|
|
|
$
|
249
|
|
|
|
10.8
|
%
|
Occupancy rate
|
|
|
98.8
|
%
|
|
|
99.9
|
%
|
|
|
(1.1
|
)pts
|
Revenue per available room
|
|
$
|
273
|
|
|
$
|
248
|
|
|
|
10.1
|
%
|
Food and beverage revenues for the three months ended
March 31, 2007 increased $2.5 million as compared to
the three months ended March 31, 2006. The increase was
primarily attributable to food and beverage revenues at the
Sands Macao, which increased $6.1 million due to increased
number of visitors. This was offset by a decrease of food and
beverage revenues at The Venetian, which decreased
$3.6 million due primarily to several large group room
cancellations during the current quarter. These groups were
partially replaced by smaller groups, which generated lower food
and beverage revenues.
Convention, retail and other revenues for the three months ended
March 31, 2007 increased $8.0 million as compared to
the three months ended March 31, 2006. The increase is
primarily attributable to an additional $2.8 million in
revenues primarily associated with the Phantom-The Las
Vegas Spectacular and Gordie Brown at The
Venetian performances, which began in June 2006 and
October 2006, respectively, and $8.4 million in other
revenue related to non-refundable deposits and fees related to
the large group room cancellations referred to above. The
increase was offset by a decrease in convention revenues of
$3.7 million primarily due to certain shows that are held
on a bi-annual basis as well as several groups that did not
return in the first quarter of 2007.
Operating
Expenses
The breakdown of operating expenses is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
Percent
|
|
|
|
2007
|
|
|
2006
|
|
|
Change
|
|
|
|
(In thousands, except for percentages)
|
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Casino
|
|
$
|
278,697
|
|
|
$
|
205,344
|
|
|
|
35.7
|
%
|
Rooms
|
|
|
22,524
|
|
|
|
21,753
|
|
|
|
3.5
|
%
|
Food and beverage
|
|
|
23,633
|
|
|
|
24,057
|
|
|
|
(1.8
|
)%
|
Convention, retail and other
|
|
|
17,431
|
|
|
|
16,395
|
|
|
|
6.3
|
%
|
Provision for doubtful accounts
|
|
|
15,516
|
|
|
|
4,989
|
|
|
|
211.0
|
%
|
General and administrative
|
|
|
57,971
|
|
|
|
54,812
|
|
|
|
5.8
|
%
|
Corporate expense
|
|
|
18,519
|
|
|
|
12,954
|
|
|
|
43.0
|
%
|
Rental expense
|
|
|
6,708
|
|
|
|
3,707
|
|
|
|
81.0
|
%
|
Pre-opening expense
|
|
|
22,457
|
|
|
|
2,219
|
|
|
|
912.0
|
%
|
Development expense
|
|
|
2,346
|
|
|
|
9,168
|
|
|
|
(74.4
|
)%
|
Depreciation and amortization
|
|
|
31,232
|
|
|
|
25,005
|
|
|
|
24.9
|
%
|
Loss on disposal of assets
|
|
|
178
|
|
|
|
1,081
|
|
|
|
(83.5
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
$
|
497,212
|
|
|
$
|
381,484
|
|
|
|
30.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
28
Operating expenses were $497.2 million for the three months
ended March 31, 2007, an increase of $115.7 million as
compared to $381.5 million for the three months ended
March 31, 2006. The increase in operating expenses was
primarily attributable to the higher operating revenues and
growth of our operating businesses in Macao and to a lesser
extent in Las Vegas, as more fully described below.
Casino department expenses for the three months ended
March 31, 2007 increased $73.4 million as compared to
the three months ended March 31, 2006. Of the
$73.4 million increase in casino expenses,
$39.2 million was due to the 39.0% gross win tax on casino
revenues in Macao. Despite the higher gross win tax, casino
operating margins at the Sands Macao are similar to those at The
Venetian primarily because of lower labor, marketing and sales
expenses in Macao. As the Rolling Chip volume increases as a
percentage of our total gaming operations, casino margins will
decrease due to the commissions paid under the Rolling Chip
program. The increase in casino expenses reflect an elevated
level of expenses of approximately $12.0 million at the
Sands Macao associated with investments in our human resources
and our Rolling Chip program. The remaining increase was
primarily attributable to the additional payroll related
expenses related to the continued growth of our operations at
the Sands Macao.
The provision for doubtful accounts for the three months ended
March 31, 2007 increased $10.5 million as compared to
the three months ended March 31, 2006, due primarily to a
$10.6 million provision for one customer during the three
months ended March 31, 2007. The amount of this provision
can vary over short periods of time because of factors specific
to the customers who owe us money from gaming activities at any
given time. We believe that the amount of our provision for
doubtful accounts in the future will depend upon the state of
the economy, our credit standards, our risk assessments and the
judgment of our employees responsible for granting credit.
General and administrative expenses for the three months ended
March 31, 2007 increased $3.2 million as compared to
the three months ended March 31, 2006. The increase was
attributable to the growth of our businesses in Las Vegas and
Macao.
Corporate expense for the three months ended March 31, 2007
increased $5.6 million as compared to the three months
ended March 31, 2006. The increase was primarily
attributable to increases of $2.3 million in payroll
related expenses and $2.7 million of corporate general and
administrative costs as we continue to build our corporate
infrastructure.
Pre-opening and development expenses were $22.5 million and
$2.3 million, respectively, for the three months ended
March 31, 2007, compared to $2.2 million and
$9.2 million, respectively, for the three months ended
March 31, 2006. Pre-opening expense represents personnel
and other costs incurred prior to the opening of new ventures
which are expensed as incurred. Pre-opening expenses for the
three months ended March 31, 2007 were primarily related to
The Venetian Macao and other Cotai Strip projects and to The
Marina Bay Sands project in Singapore. Development expense
includes the costs associated with the Companys evaluation
and pursuit of new business opportunities, which are also
expensed as incurred. Development expenses for the three months
ended March 31, 2007 were primarily related to our
activities in Hengqin Island and Europe. We expect that
pre-opening expenses will continue to increase significantly in
2007 with scheduled openings of The Venetian Macao and The
Palazzo and as we progress with our projects in Singapore and
Pennsylvania.
Depreciation and amortization expense for the three months ended
March 31, 2007 increased $6.2 million as compared to
the three months ended March 31, 2006. The increase was
primarily the result of capital improvements at The Venetian and
Sands Macao.
29
Interest
Expense
The following table summarizes information related to interest
expense on long-term debt:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
|
(In thousands, except for percentages)
|
|
|
Interest cost
|
|
$
|
81,432
|
|
|
$
|
29,728
|
|
Less: Capitalized interest
|
|
|
(46,820
|
)
|
|
|
(8,313
|
)
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
$
|
34,612
|
|
|
$
|
21,415
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
80,416
|
|
|
$
|
31,905
|
|
Average total debt balance
|
|
$
|
4,179,138
|
|
|
$
|
1,652,519
|
|
Weighted average interest rate
|
|
|
7.8
|
%
|
|
|
7.1
|
%
|
Interest expense, net of amounts capitalized, for the three
months ended March 31, 2007, increased $13.2 million
as compared to the three months ended March 31, 2006. This
increase is primarily attributable to an increase in our average
long-term debt balances resulting primarily from the completion
of the $2.5 billion Macao credit facility in May 2006, to
support our development activities in Macao, and the
$1.46 billion Singapore bridge facility in August 2006, to
support the development of The Marina Bay Sands. We expect
interest expense will continue to increase as our long-term debt
balances and interest rates increase. This increase was offset
by the capitalization of $46.8 million of interest during
the three months ended March 31, 2007, compared to
$8.3 million of capitalized interest during the three
months ended March 31, 2006. We expect that the capitalized
interest amount will continue to increase as The Venetian Macao
and The Palazzo projects approach their opening dates later this
year and as we increase our construction activities on the Cotai
Strip, at The Marina Bay Sands and at Sands Bethworks.
Other
Factors Effecting Earnings
Interest income for the three months ended March 31, 2007
was $12.7 million, an increase of $2.5 million as
compared to $10.2 million for the three months ended
March 31, 2006. The increase was primarily attributable to
additional invested cash balances, primarily from our borrowings
under the senior secured credit facility and the Macao credit
facility, which have not yet been spent.
Other expense for the three months ended March 31, 2007 was
$7.0 million as compared to other income of
$0.2 million for the three months ended March 31,
2006. The $7.0 million expense amount was primarily
attributable to foreign exchange losses in Macao.
Our effective income tax rate for the three months ended
March 31, 2007 was 10.9%. The effective tax rate for the
2007 period was significantly lower than the United States
federal statutory rate due primarily to a zero effective tax
rate on our Macao net income as a result of a temporary income
tax exemption in Macao on gaming operations, which is to expire
at the end of 2008. The effective tax rate was 11.7% for the
three months ended March 31, 2006 primarily due to the
application of the aforementioned Macao temporary income tax
exemption.
30
Liquidity
and Capital Resources
Cash
Flows Summary
Our cash flows consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2007
|
|
|
2006
|
|
|
|
(In thousands)
|
|
|
Net cash provided by operations
|
|
$
|
51,351
|
|
|
$
|
145,826
|
|
|
|
|
|
|
|
|
|
|
Investing cash flows:
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
(764,964
|
)
|
|
|
(294,233
|
)
|
Change in restricted cash
|
|
|
398,571
|
|
|
|
(47,786
|
)
|
|
|
|
|
|
|
|
|
|
Net cash used in investing
activities
|
|
|
(366,393
|
)
|
|
|
(342,019
|
)
|
|
|
|
|
|
|
|
|
|
Financing cash flows:
|
|
|
|
|
|
|
|
|
Repayments of long-term debt
|
|
|
(100,140
|
)
|
|
|
(52,151
|
)
|
Proceeds of long term-debt
|
|
|
370,859
|
|
|
|
106,204
|
|
Other
|
|
|
10,992
|
|
|
|
2,496
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing
activities
|
|
|
281,711
|
|
|
|
56,549
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate on cash
|
|
|
4,790
|
|
|
|
75
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash
equivalents
|
|
$
|
(28,541
|
)
|
|
$
|
(139,569
|
)
|
|
|
|
|
|
|
|
|
|
Cash
Flows Operating Activities
The Venetians slot machine and retail hotel rooms
businesses are generally conducted on a cash basis, its table
games and group hotel rooms businesses are conducted on a cash
and credit basis and its banquet business is conducted primarily
on a credit basis resulting in operating cash flows being
generally affected by changes in operating income and accounts
receivables. The Sands Macao table games and slot machine play
is currently conducted primarily on a cash basis. Net cash
provided by operating activities for the three months ended
March 31, 2007 was $51.4 million, a decrease of
$94.4 million as compared with $145.8 million for the
three months ended March 31, 2006. The primary factor
contributing to the net decrease in cash flow provided by
operating activities was a $105.9 million land concession
payment made to the Macao government for The Venetian Macao and
two other sites on the Cotai Strip (parcels 2 and 3).
Cash
Flows Investing Activities
Capital expenditures for the three months ended March 31,
2007 totaled $765.0 million, including $39.5 million
on expansions, improvements and maintenance capital expenditures
at The Venetian and The Sands Expo Center in Las Vegas;
$457.8 million for construction and development activities
in Macao (including the Sands Macao and The Venetian Macao on
the Cotai Strip); $43.4 million for construction and
development activities in Singapore; $177.8 million for
construction and development activities at The Palazzo and
$46.5 million for corporate activities, primarily for the
purchase of aircraft.
Restricted cash decreased $398.6 million primarily as a
result of construction payments related to The Palazzo and The
Venetian Macao.
Cash
Flows Financing Activities
For the three months ended March 31, 2007, net cash flows
provided from financing activities were $281.7 million. The
net increase was primarily attributable to the borrowings of
$85.0 million under the Macao credit facility,
$110.8 million under the Singapore credit facility,
$72.0 million under the airplane financings and
31
$35.0 million from the Phase II mall construction
loan, offset by the net repayments of $37.0 million on the
senior secured revolving credit facility.
Capital
and Liquidity
As of March 31, 2007 and December 31, 2006, we held
unrestricted cash and cash equivalents of $439.5 million
and $468.1 million, respectively. We expect to fund our
operations, capital expenditures at The Venetian, The Sands Expo
Center and the Sands Macao (other than the Sands Macao expansion
construction) and debt service requirements from existing cash
balances, operating cash flow and borrowings under our Las Vegas
and Macao revolving credit facilities.
In March 2007, the $2.5 billion Macao credit facility was
amended to expand the use of proceeds and remove certain
restrictive conditions. In April 2007, the lenders of the Macao
credit facility approved a reduction of the interest rate margin
for all classes of loans by 50 basis points and we
exercised our rights under the Macro credit facility to access
the $800.0 million of incremental facilities under the
accordion feature set forth therein, which increased the total
credit facility to $3.3 billion. In April 2007, we borrowed
$600.0 million of the $800.0 million accordion feature.
In February 2007, we entered into promissory notes totaling
$72.0 million to finance the purchase of one airplane and
refinance two others that were already owned. On April 17,
2007, we announced that we commenced marketing of a
$5.0 billion senior secured credit facility. See
Item 1 Financial Statements
Notes to Condensed Consolidated Financial Statements
Note 4 Long-term Debt for details on
these financing transactions.
Aggregate
Indebtedness and Other Known Contractual Obligations
As of March 31, 2007, there had been no material changes to
our aggregated indebtedness and other known contractual
obligations, which are set forth in the table included in our
Annual Report on
Form 10-K
for the year ended December 31, 2006, with the exception of
the payments (net of borrowings) of $37.0 million on the
senior secured credit facility, the additional borrowing of
$85.0 million on the Macao credit facility, the additional
borrowing of $121.3 million on the Singapore credit
facility, the additional borrowing of $35.0 million on the
Phase II mall construction loan, the borrowing of
$72.0 million on the airplane financings, the borrowing of
$6.1 million of other debt and being awarded the Macao land
concession. The following table reflects the impact of the
foregoing:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments Due by Period Ending March 31, 2007(9)
|
|
|
|
Less than
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Year
|
|
|
1-3 Years
|
|
|
3-5 Years
|
|
|
Thereafter
|
|
|
Total
|
|
|
|
(In thousands)
|
|
|
Senior secured credit
facility revolving facility(1)
|
|
$
|
|
|
|
$
|
(37,000
|
)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
(37,000
|
)
|
Macao credit facility(2)
|
|
|
|
|
|
|
1,488
|
|
|
|
62,900
|
|
|
|
20,612
|
|
|
|
85,000
|
|
Singapore credit facility(3)
|
|
|
|
|
|
|
121,329
|
|
|
|
|
|
|
|
|
|
|
|
121,329
|
|
Airplane financings(4)
|
|
|
2,878
|
|
|
|
5,755
|
|
|
|
5,755
|
|
|
|
57,612
|
|
|
|
72,000
|
|
Phase II mall construction
loan(5)
|
|
|
35,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,000
|
|
Other debt(6)
|
|
|
6,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,082
|
|
Macao Subsidiary Land Lease(7)
|
|
|
116,492
|
|
|
|
74,388
|
|
|
|
20,834
|
|
|
|
57,878
|
|
|
|
269,592
|
|
Variable interest payments(8)
|
|
|
17,132
|
|
|
|
20,139
|
|
|
|
20,634
|
|
|
|
17,938
|
|
|
|
75,843
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
177,584
|
|
|
$
|
186,099
|
|
|
$
|
110,123
|
|
|
$
|
154,040
|
|
|
$
|
627,846
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Amount represents the net repayment of $37.0 million during
2007. The revolving facility matures in February 2010 and has no
interim amortization. |
32
|
|
|
(2) |
|
Amount represents the additional $85.0 million borrowed
during 2007 under the Term B Delayed Draw Facility. The Macao
Term B Delayed Draw Facility matures on May 25, 2012 and is
subject to nominal amortization for the first five years with
the remainder of the loan payable in four equal installments in
the last year immediately preceding its maturity date. |
|
(3) |
|
Amount represents the additional $121.3 million outstanding
at March 31, 2007. The Singapore credit facility matures on
August 22, 2008 and has no interim amortization. |
|
(4) |
|
Amount represents the airplane financings borrowed during 2007,
which mature on March 1, 2017. |
|
(5) |
|
Amount represents the additional $35.0 million borrowed
during 2007. The Phase II mall construction loan is due
March 30, 2008. |
|
(6) |
|
Amount represents the other debt borrowed during 2007, which
matures on March 28, 2008. |
|
(7) |
|
In February 2007, we were awarded a concession by lease for
parcels 1, 2 and 3 on the Cotai Strip, including the
parcels on which we are building The Venetian Macao and the Four
Seasons hotel. Each parcels share of the remaining land
premium balance will either be due upon completion of the
corresponding resort or be payable through seven semi-annual
payments to be made over a four year period and bearing interest
at 5%, whichever comes first. The total remaining payment
obligation under this lease was $269.6 million as of
March 31, 2007. |
|
(8) |
|
Amount represents the incremental increase in estimated variable
interest payments based on the changes in long-term debt
obligations noted above. Based on March 31, 2007 LIBOR
rates of 5.4% plus the applicable interest rate spread in
accordance with the respective debt agreements. |
|
(9) |
|
We adopted the provisions of FIN No. 48 on
January 1, 2007 and as of March 31, had an
$8.5 million liability related to unrecognized tax benefits. |
Restrictions
on Distributions
We are a parent company with limited business operations. Our
main asset is the stock and membership interests of our
subsidiaries. The debt instruments of our principal operating
subsidiary, Las Vegas Sands, LLC, contain significant
restrictions on the payment of dividends and distributions to us
by Las Vegas Sands, LLC. In particular, the senior secured
credit facility prohibits Las Vegas Sands, LLC from paying
dividends or making distributions to us, or investing in us,
with limited exceptions. Las Vegas Sands, LLC may make certain
distributions to us to cover taxes and certain reasonable and
customary operating costs. In addition, Las Vegas Sands, LLC may
make distributions to us in order to enable us to pay dividends
on our common stock so long as construction of The Palazzo is
substantially complete and certain financial leverage tests are
satisfied, which distributions may not exceed $25.0 million
or $50.0 million during any twelve-month period depending
on our financial leverage ratio at the time of such
distributions.
In addition, the debt instrument of our subsidiary,
Phase II Mall Subsidiary, LLC (the Phase II Mall
Subsidiary), restricts the payment of dividends and
distributions to us. Subject to limited exceptions, the
Phase II mall construction loan prohibits the Phase II
Mall Subsidiary from paying dividends or making distributions to
us, or making investments in us, other than tax distributions
and a limited basket amount.
The debt instruments of our subsidiaries, including the Macao
credit facility for the construction of The Venetian Macao and
the Singapore credit facility for the construction of The Marina
Bay Sands contain certain restrictions that, among other things,
limit the ability of our company and/or certain subsidiaries to
incur additional indebtedness, issue disqualified stock or
equity interests, pay dividends or make other distributions,
repurchase equity interests or certain indebtedness, create
certain liens, enter into certain transactions with affiliates,
enter into certain mergers or consolidations or sell some or all
of our assets or the assets of the applicable company without
prior approval of the lenders or noteholders. Financial
covenants included in our senior secured credit facility and our
Macao credit facility include a minimum interest coverage ratio,
a maximum leverage ratio, a minimum net worth covenant and
maximum capital expenditure limitations.
Inflation
We believe that inflation and changing prices have not had a
material impact on our net sales, revenues or income from
continuing operations during the past year.
33
Special
Note Regarding Forward-Looking Statements
This report contains forward-looking statements that are made
pursuant to the Safe Harbor Provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include the discussions of our business strategies and
expectations concerning future operations, margins,
profitability, liquidity, and capital resources. In addition, in
certain portions included in this report, the words:
anticipates, believes,
estimates, seeks, expects,
plans, intends and similar expressions,
as they relate to our company or its management, are intended to
identify forward-looking statements. Although we believe that
these forward-looking statements are reasonable, we cannot
assure you that any forward-looking statements will prove to be
correct. These forward-looking statements involve known and
unknown risks, uncertainties and other factors, which may cause
our actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements. These
factors include, among others, the risks associated with:
|
|
|
|
|
general economic and business conditions which may impact levels
of disposable income, consumer spending and pricing of hotel
rooms;
|
|
|
|
the uncertainty of tourist behavior related to spending and
vacationing at casino resorts in Las Vegas and Macao;
|
|
|
|
disruptions or reductions in travel due to conflicts with Iraq
and any future terrorist incidents;
|
|
|
|
outbreaks of infectious diseases, such as severe acute
respiratory syndrome or avian flu, in our market areas;
|
|
|
|
our dependence upon three properties in two markets for all of
our cash flow;
|
|
|
|
new developments, construction and ventures, including The
Palazzo, The Venetian Macao and other Cotai Strip developments,
The Marina Bay Sands in Singapore and Sands Bethworks;
|
|
|
|
our ability to obtain sufficient funding for our developments,
including our developments on the Cotai Strip and in Singapore;
|
|
|
|
the passage of new legislation and receipt of governmental
approvals for our proposed developments in Macao, Singapore and
other jurisdictions where we are planning to operate;
|
|
|
|
our substantial leverage and debt service (including sensitivity
to fluctuations in interest rates and other capital markets
trends);
|
|
|
|
our insurance coverage, including the risk that we have not
obtained sufficient coverage against acts of terrorism or will
only be able to obtain additional coverage at significantly
increased rates;
|
|
|
|
government regulation of the casino industry, including gaming
license regulation, the legalization of gaming in certain
domestic jurisdictions, including Native American reservations,
and regulation of gaming on the Internet;
|
|
|
|
increased competition and additional construction in Las Vegas
and Macao, including recent and upcoming increases in hotel
rooms, meeting and convention space and retail space;
|
|
|
|
fluctuations in the demand for all-suites rooms, occupancy rates
and average daily room rates in Las Vegas;
|
|
|
|
the popularity of Las Vegas as a convention and trade show
destination;
|
|
|
|
new taxes or changes to existing tax rates;
|
|
|
|
our ability to meet certain development deadlines in Macao and
Singapore;
|
|
|
|
our ability to maintain our gaming subconcession in Macao;
|
|
|
|
the completion of infrastructure projects in Macao;
|
34
|
|
|
|
|
increased competition and other planned construction projects in
Macao; and
|
|
|
|
any future litigation.
|
All future written and verbal forward-looking statements
attributable to us or any person acting on our behalf are
expressly qualified in their entirety by the cautionary
statements contained or referred to in this section. New risks
and uncertainties arise from time to time, and it is impossible
for us to predict these events or how they may affect us.
Readers are cautioned not to place undue reliance on these
forward-looking statements. We assume no obligation to update
any forward-looking statements after the date of this report as
a result of new information, future events or developments,
except as required by federal securities laws.
|
|
ITEM 3
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Market risk is the risk of loss arising from adverse changes in
market rates and prices, such as interest rates, foreign
currency exchange rates and commodity prices. Our primary
exposure to market risk is interest rate risk associated with
our long-term debt. We attempt to manage our interest rate risk
by managing the mix of our long-term fixed-rate borrowings and
variable rate borrowings, and by use of interest rate cap
agreements. The ability to enter into interest rate cap
agreements allows us to manage our interest rate risk associated
with our variable rate debt. We do not hold or issue financial
instruments for trading purposes and do not enter into
derivative transactions that would be considered speculative
positions. Our derivative financial instruments consist
exclusively of interest rate cap agreements, which do not
qualify for hedge accounting. Interest differentials resulting
from these agreements are recorded on an accrual basis as an
adjustment to interest expense.
To manage exposure to counterparty credit risk in interest rate
cap agreements, we enter into agreements with highly rated
institutions that can be expected to fully perform under the
terms of such agreements. Frequently, these institutions are
also members of the bank group providing our credit facilities,
which management believes further minimizes the risk of
nonperformance.
The table below provides information about our financial
instruments that are sensitive to changes in interest rates. For
debt obligations, the table presents notional amounts and
weighted average interest rates by contractual maturity dates.
Notional amounts are used to calculate the contractual payments
to be exchanged under the contract. Weighted average variable
rates are based on March 31, 2007 LIBOR rates plus the
applicable interest rate spread in accordance with the
respective debt agreements. The information is presented in
U.S. dollar equivalents, which is the Companys
reporting currency, for the years ending March 31:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair
|
|
|
|
2008
|
|
|
2009
|
|
|
2010
|
|
|
2011
|
|
|
2012
|
|
|
Thereafter
|
|
|
Total
|
|
|
Value(1)
|
|
|
|
(In millions, except for percentages)
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable rate
|
|
$
|
165.6
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
165.6
|
|
|
$
|
165.6
|
|
Average interest rate(2)
|
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7.1
|
%
|
|
|
7.1
|
%
|
Long-term debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed rate
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
250.0
|
|
|
$
|
250.0
|
|
|
$
|
238.8
|
|
Average interest rate(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6.4
|
%
|
|
|
6.4
|
%
|
|
|
7.1
|
%
|
Variable rate
|
|
$
|
|
|
|
$
|
1,175.8
|
|
|
$
|
283.1
|
|
|
$
|
933.3
|
|
|
$
|
384.7
|
|
|
$
|
1,233.2
|
|
|
$
|
4,010.1
|
|
|
$
|
4,010.1
|
|
Average interest rate(2)
|
|
|
|
|
|
|
4.9
|
%
|
|
|
7.1
|
%
|
|
|
7.1
|
%
|
|
|
7.3
|
%
|
|
|
6.7
|
%
|
|
|
6.3
|
%
|
|
|
6.3
|
%
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cap Agreements(3)
|
|
$
|
0.1
|
|
|
$
|
0.2
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
|
|
|
(1) |
|
The fair values are based on the borrowing rates currently
available for debt instruments with similar terms and maturities
and market quotes of our publicly traded debt. |
35
|
|
|
(2) |
|
Based upon contractual interest rates for fixed rate
indebtedness or current LIBOR rates for variable rate
indebtedness. |
|
(3) |
|
As of March 31, 2007, we have six interest rate cap
agreements with a fair value of $0.3 million based on a
quoted market value from the institution holding the agreement. |
Borrowings under the senior secured credit facility bear
interest at our election at LIBOR plus 1.75% or the base rate
plus 0.75% per annum, subject to downward adjustments based
upon our credit rating. Borrowings under the $250.0 million
Phase II mall construction loan facility bear interest at
our election at either a base rate plus 0.75% per annum or
at LIBOR plus 1.75% per annum. Borrowings under The Sands
Expo Center mortgage loan bear interest at an interest rate
equal to LIBOR plus 3.75%. Borrowings under the Macao credit
facility bear interest at our election, at either an adjusted
Eurodollar rate (or in the case of the Local Term Loan, adjusted
HIBOR) plus 2.75% per annum or at an alternative base rate
plus 1.75% per annum, and is subject to a downward
adjustment of 0.25% per annum from the beginning of the
first interest period following the substantial completion of
The Venetian Macao. Borrowings under the Singapore credit
facility bear interest at the Singapore SWAP Offer Rate plus a
spread of 1.35% per annum during the first twelve months
that amounts are outstanding and a spread of 1.6% per annum
during the second twelve months that amounts are outstanding.
Borrowings under the airplane financings bear interest at LIBOR
plus 1.5% per annum.
Foreign currency transaction gains and losses were not material
to our results of operations for the three months ended
March 31, 2007, but may be in future periods in relation to
activity associated with our Macao and Singapore subsidiaries.
Therefore, we may be vulnerable to changes in
U.S. dollar/pataca and U.S. dollar/Singapore dollar
exchange rates. We do not hedge our exposure to foreign
currency; however, we maintain a significant amount of our
operating funds in the same currencies in which we have
obligations thereby reducing our exposure to currency
fluctuations.
See also Liquidity and Capital Resources.
ITEM 4
CONTROLS AND PROCEDURES
Evaluation
of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that
information required to be disclosed in the reports that the
Company files or submits under the Securities Exchange Act of
1934 is recorded, processed, summarized, and reported within the
time periods specified in the Securities and Exchange
Commissions rules and forms and that such information is
accumulated and communicated to our management, including our
principal executive officer and principal financial officer, as
appropriate, to allow for timely decisions regarding required
disclosure. The Companys Chief Executive Officer and its
Chief Financial Officer have evaluated the disclosure controls
and procedures (as defined in the Securities Exchange Act of
1934
Rules 13a-15(e)
and
15d-15(e))
of the Company as of March 31, 2007 and have concluded that
they are effective to provide reasonable assurance that the
desired control objectives were achieved.
It should be noted that any system of controls, however well
designed and operated, can provide only reasonable, and not
absolute, assurance that the objectives of the system are met.
In addition, the design of any control system is based in part
upon certain assumptions about the likelihood of future events.
Because of these and other inherent limitations of control
systems, there can be no assurance that any design will succeed
in achieving its stated goals under all potential future
conditions, regardless of how remote.
Changes
in Internal Control over Financial Reporting
There were no changes in the Companys internal control
over financial reporting that occurred during the fiscal quarter
covered by this Quarterly Report on
Form 10-Q
that have materially affected, or are reasonably likely to
materially affect, the Companys internal control over
financial reporting.
36
Part II
OTHER
INFORMATION
ITEM 1
LEGAL PROCEEDINGS
The Company is party to litigation matters and claims related to
its operations. For more information, see the Companys
Annual Report on
Form 10-K
for the year ended December 31, 2006 and
Part I Item 1 Financial
Statements Notes to Condensed Consolidated Financial
Statements Note 7 Commitments and
Contingencies of this Quarterly Report on
Form 10-Q.
ITEM 1A
RISK FACTORS
There have been no material changes from the risk factors
previously disclosed in the Companys Annual Report on
Form 10-K
for the year ended December 31, 2006.
37
LAS VEGAS
SANDS CORP.
ITEM 6
EXHIBITS
List of
Exhibits
|
|
|
|
|
Exhibit No.
|
|
Description of Document
|
|
|
10
|
.1
|
|
First Amendment to Credit
Agreement and Disbursement Agreement, dated as of March 5,
2007, among Venetian Macau Limited, VML US Finance LC, Venetian
Cotai Limited and The Bank of Nova Scotia, as Administrative
Agent and Disbursement Agent.
|
|
10
|
.2
|
|
First Amendment to Disbursement
Agreement, dated as of March 5, 2007, among VML US Finance
LLC, Venetian Cotai Limited, Venetian Macau Limited and The Bank
of Nova Scotia, as Disbursement Agent and Bank Agent.
|
|
10
|
.3
|
|
Land Concession Agreement, by
Lease and Without Public Tender, between Macau Special
Administrative Region, Venetian Cotai Limited and Venetian Macau
Limited.
|
|
31
|
.1
|
|
Certification of the Chief
Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
31
|
.2
|
|
Certification of the Chief
Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
32
|
.1
|
|
Certification of Chief Executive
Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
|
|
32
|
.2
|
|
Certification of Chief Financial
Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
|
38
LAS VEGAS
SANDS CORP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this quarterly report on
Form 10-Q
to be signed on its behalf by the undersigned thereunto duly
authorized.
LAS VEGAS SANDS CORP.
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By:
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/s/ Sheldon
G. Adelson
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Sheldon G. Adelson
Chairman of the Board and
Chief Executive Officer
May 9, 2007
Robert P. Rozek
Senior Vice President and
Chief Financial Officer
May 9, 2007
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LAS VEGAS
SANDS CORP.
EXHIBIT INDEX
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Exhibit No.
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Description of Document
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10
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.1
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First Amendment to Credit
Agreement and Disbursement Agreement, dated as of March 5,
2007, among Venetian Macau Limited, VML US Finance LC, Venetian
Cotai Limited and The Bank of Nova Scotia, as Administrative
Agent and Disbursement Agent.
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10
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.2
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First Amendment to Disbursement
Agreement, dated as of March 5, 2007, among VML US Finance
LLC, Venetian Cotai Limited, Venetian Macau Limited and The Bank
of Nova Scotia, as Disbursement Agent and Bank Agent.
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10
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.3
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Land Concession Agreement, by
Lease and Without Public Tender, between Macau Special
Administrative Region, Venetian Cotai Limited and Venetian Macau
Limited.
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31
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.1
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Certification of the Chief
Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
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31
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.2
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Certification of the Chief
Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
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32
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.1
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Certification of Chief Executive
Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
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32
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.2
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Certification of Chief Financial
Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
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40