Fairly negative commentary overall but a ray of hope: "October was an anomaly"
CONF CALL
- November trends: more normal. Still tough but October was 'an anomaly'
- Gaming revenue affected by changes in Mainland China regulatory policies
- 3Q dividend: 22 cents/share; dividend policy: pay no less than 50% of profits
- Cutback in luxury goods and gambling budgets
- Other factors: Visa restrictions, increased funding costs in junkets and increased scrutiny on UnionPay transactions (cannot be in casinos)
- October: continuation of trends in past summer
- Mass market affected in October: partial smoking ban and HK protests
- Grand Lisboa tables:
- Going to reconfigure Grand Lisboa to accommodate mass market by shifting 5 tables to mass market
- Expect more tables from govt (have applied for 45 tables - 35 tables allocated to Legend, 10 tables to Grand Lisboa)
- Adding new premium mass space in January (shift VIP to mass - 15 tables in Grand Lisboa)
- Grand Jai-Alai will open in 2015
- SJM Cotai on schedule to open in 2017
- 1 item items in 3Q: higher staff costs (14th month bonus - $43m; $5-6m incremental costs for rest of year), change in marketable securities value ($20m)
- 3Q EBITDA margins: have normalized; declining VIP volumes have had high adverse impact on margins
- Occupancy Grand Lisboa: 40 rooms being refurbished (process will take 2 yrs)
- Smoking ban: have impacted player time on tables; saw more impact on slot side than table side
- VIP business at old Lisboa was very soft
- Oceanus will be impacted by Grand Prix
- Grand Lisboa visitation: visa restrictions had impact on premium mass segment. October visitation was down 8%.
- Mass reclassification: have not reclassified any tables in October; do not have any current plans to reclassify
- Grand Lisboa: have placed 7 smoking areas