{"id":117037,"date":"2019-10-13T05:00:05","date_gmt":"2019-10-13T12:00:05","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=117037"},"modified":"2019-10-13T10:29:09","modified_gmt":"2019-10-13T17:29:09","slug":"fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/","title":{"rendered":"Las Vegas Sands Debt Affirmed BBB- by Fitch, Ratings Agency Sees Macau Extension Risk as Remote"},"content":{"rendered":"

Las Vegas Sands Corp. (NYSE:LVS) had its corporate credit rating affirmed at BBB- by Fitch Ratings, with the research firm saying there’s a \u201cremote\u201d chance the gaming company’s Macau licenses will not be extended in 2022.<\/p>\n

\"\"
Sheldon Adelson’s Las Vegas Sands keeps its investment-grade rating, and Fitch sees little chance of Macau extension issues. (Image: CNBC)<\/figcaption><\/figure>\n

Sands, which operates five integrated resorts in Macau and has had a presence on the peninsula for nearly two decades, derived nearly two-thirds of its second-quarter revenue<\/a> from the Special Administrative Region (SAR).<\/p>\n

While Fitch concedes that it’s unlikely LVS doesn’t have its Macau licenses renewed, the credit evaluator notes the issue is preventing it from boosting the gaming company’s rating to BBB, and that there is the potential for burdensome extension terms.<\/p>\n

Fitch believes that the risk of the concession not being extended is very remote,\u201d said the ratings agency in a note obtained by Casino.org<\/i>. \u201cA more plausible risk is LVS being subject to onerous extension terms, such as a higher tax, a concession payment, or a call by the government for significant lower ROI investments.\u201d<\/p><\/blockquote>\n

Macau\u2019s next chief executive, Ho Iat Seng, takes office in December, prompting Fitch to say the concession extension conversation should gain momentum in 2020. Each of the SAR’s six concession holders \u2013 LVS, Galaxy Entertainment, MGM Resorts, Wynn Resorts<\/a>, Melco Resorts, and SJM Holdings \u2013 must renew their licenses in 2022.<\/p>\n

Fitch is the second ratings firm to say it’s likely operators have their Macau concessions renewed, with Moody’s voicing a similar opinion in August.<\/a><\/p>\n

Positive Outlook<\/h2>\n

While Fitch is currently somewhat reluctant to up its rating on LVS to BBB, the ratings firm does have a \u201cpositive\u201d outlook on the company’s credit profile, and rates Marina Bay Sands Pte Ltd.<\/a>, the gaming operator’s Singapore unit, BBB.<\/p>\n

\u201cLVS has operated well within Fitch’s upgrade leverage ratio sensitivities for an extended period of time, driving the Positive Outlook,\u201d said Fitch. \u201cAlso driving the Outlook is Fitch’s increased confidence that LVS can absorb a large scale development, such as a Japan integrated resort (IR), without material long-term deterioration in the leverage credit metrics or liquidity strain.\u201d<\/p>\n

\n

Due to its success in Macau and Singapore, LVS is widely viewed as one of the leading contenders to land one of Japan’s prized gaming licenses. Sands, one of the best generators of return on invested capital (ROIC) in the gaming industry, said in August it’s focusing<\/a> its Japan integrated resort efforts on Tokyo and Yokohama.<\/p>\n<\/div>\n

At the end of the second quarter, LVS had $12.02 billion in debt and $4.03 billion in cash on hand. In late July, the company sold $3.5 billion of debt, its first issue with investment-grade ratings from all three major credit agencies.<\/p>\n

Good Vibes In Macau<\/h2>\n

Gross gaming revenue (GGR) on the peninsula has recently sagged<\/a> due to the slowing Chinese economy and the trade spat with the US, among other factors. But Fitch has a bullish long-term view on the region and LVS.<\/p>\n

\u201cFitch expects LVS to experience roughly mid-single digit growth at its properties and slightly exceed the broader Macau market, given their focus on the mass market,\u201d said the research firm. \u201cFitch maintains a positive long-term outlook on Macau, supported by the expanding middle class in China and the development of infrastructure in and around Macau. Fitch believes that the government will take a programmatic approach to renewing the gaming concessions expiring 2022.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

Las Vegas Sands Corp. (NYSE:LVS) had its corporate credit rating affirmed at BBB- by Fitch Ratings, with the research firm saying there’s a \u201cremote\u201d chance the gaming company’s Macau licenses will not be extended in 2022. Sands, which operates five integrated resorts in Macau and has had a presence on the peninsula for nearly two […]<\/p>\n","protected":false},"author":46,"featured_media":117040,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[],"acf":[],"yoast_head":"\nFitch Bullish on Las Vegas Sands, Not Much Macau Extension Risk<\/title>\n<meta name=\"description\" content=\"Las Vegas Sands retains an investment-grade credit rating and could be upgraded as Macau extension risk abates, says Fitch.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fitch Bullish on Las Vegas Sands, Not Much Macau Extension Risk\" \/>\n<meta property=\"og:description\" content=\"Las Vegas Sands retains an investment-grade credit rating and could be upgraded as Macau extension risk abates, says Fitch.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2019-10-13T12:00:05+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-10-13T17:29:09+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2019\/10\/sa1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2000\" \/>\n\t<meta property=\"og:image:height\" content=\"1333\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/\",\"url\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/\",\"name\":\"Fitch Bullish on Las Vegas Sands, Not Much Macau Extension Risk\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2019\/10\/sa1.jpg\",\"datePublished\":\"2019-10-13T12:00:05+00:00\",\"dateModified\":\"2019-10-13T17:29:09+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Las Vegas Sands retains an investment-grade credit rating and could be upgraded as Macau extension risk abates, says Fitch.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/fitch-bullish-on-las-vegas-sands-not-much-macau-extension-risk\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2019\/10\/sa1.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2019\/10\/sa1.jpg\",\"width\":2000,\"height\":1333,\"caption\":\"Sheldon Adelson's Las Vegas Sands keeps its investment-grade rating and Fitch sees little chance of Macau extension issues. 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