UPDATE 3-Las Vegas Sands posts unexpected 1st-qtr net loss
(Adds analyst comment, paragraphs 5, 16)
By Deena Beasley
LOS ANGELES, April 30 (Reuters) - Las Vegas Sands Corp (LVS.N) on Wednesday posted an unexpected quarterly net loss as costs rose, competition sharpened in Macau and a weak economy cut visits to its U.S. casinos.
The news sent its already-battered shares down nearly 10 percent.
The first-quarter net loss was $11.2 million, or 3 cents per share, compared with a profit of $90.9 million, or 26 cents a share, a year earlier.
Excluding one-time items, Sands earned 7 cents a share, which fell far short of the 39 cents a share expected by Wall Street analysts, as compiled by Reuters Estimates.
Net revenue rose 72 percent to $1.08 billion, but analysts had expected $1.21 billion.
"It could be a rocky year for Las Vegas Sands, but I think ultimately the long-term outlook is fairly sound," said Robert LaFleur, an analyst at Susquehanna Financial Group.
Sands held a grand opening in January of its 3,000-room Palazzo resort in Las Vegas, adjacent to its Venetian hotel-casino and the Sands Expo and Convention Center, but the property's ramp-up has been slower than expected.
Sands said its Las Vegas casino revenue rose 24 percent in the first quarter to $147.8 million, while hotel revenue rose 42 percent to $136.2 million.
In Macau, the only part of China where gambling is legal, the company has operated a casino since 2004, and last August opened a second property, the Venetian Macao -- the world's biggest casino.
Casino revenue at the new Macau casino totaled $383.3 million in its second full quarter of operations, while operating income was $56.8 million.
First-quarter casino revenue at the older resort, Sands Macao, fell 24 percent to $264.4 million, while operating income slid to $49.6 million from $90.6 million.
"We have lost a significant amount of market share in the VIP business," Chief Operating Officer William Weidner said on a conference call.
In addition to the second Sands resort in Macau, competitors Wynn Resorts Ltd (WYNN.O) and MGM Mirage (MGM.N) opened casinos in the Chinese gambling haven last year.
Weidner said Sands continues to work through several issues in Macau, including the surprise announcement this month that the enclave would stop issuing new casino licenses and land allocations.
The statement from Macau's chief executive, Edmund Ho, "is a clear backstop to supply growth," Weidner said, while noting that the pace of approval for already-planned Macau projects has slowed.
The government "is showing a bias toward bigger, Las Vegas-style casinos that draw people in ... that should ultimately help Las Vegas Sands," Susquehanna's LaFleur said.
The company is developing a string of casino resorts in a part of Macau dubbed the Cotai Strip and is planning a convention complex on Hengqin Island, off China's southern coast.
Las Vegas-based Sands is also building a nearly $4 billion casino project in Singapore and a 126-acre casino resort development on the site of the former Bethlehem Steel plant in Bethlehem, Pennsylvania.
Shares of Sands, which closed at $76.22 on the New York Stock Exchange, were down 9.7 percent at $68.80 after hours. Before Wednesday, the stock had lost nearly half its value since October, when investors began to question Macau growth assumptions. Over the same period, the Dow Jones U.S. Gambling Index .DJUSCA dropped about 30 percent. (Editing by Richard Chang and Braden Reddall)
