Sands China posted a net loss of $125 million in August
Sands China Ltd, the gaming concessionaire in Macau and the Asian arm of Las Vegas Sands, says it fell to a net loss of $125 million and a $14 million adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss in August. The company said the main reason for the loss was tight restrictions on the border between Macau and mainland China.
In an investor statement describing the impact of COVID-19 on its operations in the previous month, Sands China reported a significant drop in revenue compared to July. In that month, its net revenue was $265 million, while its net revenue for August was $148 million. Thus, the net loss increased from $63 million to $125 million.
The EBIDTA loss of $14 million in August follows a positive EBIDTA of $44 million.
Visitors to Macau to take negative test for COVID-19
Sands China says the drop in revenue was due to tighter restrictions imposed in late July and most of August. Visitors from Guangdong province in mainland China were required to submit a negative COVID-19 certificate no more than 48 hours before their visit. For a short period, the time limit was 12 hours and then was reduced to 7 days at the end of August. - reports King Billy Casino.
Even with a net loss of $340 million and an EBIDTA loss of $162 million during July and August 2020, the company has a liquidity position of $2.56, according to Sands China. It consists of $2 billion in borrowings under the revolving credit facility, as well as $556 million in cash. The loan was extended in 2020 to boost its liquidity .
The company said in a statement that it has taken various measures to stay focused in the current changing environment. These measures include a cost and capital reduction programme to minimise non-essential cash outflows.
Relaxed frontiers to aid recovery
Speaking about the current border situation, Sands China said it was looking forward to welcoming more guests to its hotels, given the fact that more visitors can now travel to Macau. Consumer demand from those able to stay has remained strong. However, due to COVID-19 restrictions and the current pandemic situation in China and Macau, Sands China's financial performance is still limited and visitor numbers are still limited.
Sands China concluded that the pandemic had disrupted its operations and affected the number of visitors to its facilities. He added that this adverse impact was likely to continue until COVID-19 was contained and restrictions relaxed.
Although many experts believed that the pandemic would end within weeks to a month when it began in 2020, it proved to be a major global problem as many industries were affected. More than a year and a half later, COVID-19 is still a problem for which no expert knows when it will end.
