Inside Asian Gaming

July 2011 | INSIDE ASIAN GAMING 53 Briefs to S$1 million if they breach regulations. LVS secures new loans and moves towards investment- grade status Dow Jones Newswires reported Standard and Poor’s Ratings Services boosted its junk-level credit rating on Las Vegas Sands Corp (LVS) by a notch, citing the casino operator’s strong performance of late and future benefits from a proposed refinancing of its Macau operation. The ratings upgrade leaves the casino operator two notches below investment-grade status, with a stable rating outlook. The credit rater said the proposed Macau refinancing will add about US$1.1 billion of debt to prefund development, but it still expects adjusted earnings to grow about 30% in 2011, which would improve operating lease-adjusted leverage. In May, LVS reported higher first-quarter earnings as revenue got a sharp boost from the company’s Marina Bay Sands operation in Singapore. Sands China Ltd, the Hong Kong-listed unit of LVS, said in a 15th June statement it has secured US$3.5 billion five-year bank loans and will have the option to raise another US$1 billion of financing. The loan facilities are subject to approval from Macau’s government and final-loan documentation, the statement said. The new bank loans will help the company to significantly reduce its interest expense and extend its debt maturities to 2016, it said. China-Taiwan travel easing ‘no threat’ to Macau, says travel boss From 28th June, mainland Chinese from certain parts of the country—Beijing, Shanghai and Xiamen—are able to travel toTaiwan independently, rather than as part of a tour group. But AndyWu of the Travel Industry Council of Macau told Macau’s local television channel, TDM, he doesn’t believe China’s extension of its Individual Visit Scheme (IVS)—a scheme that already covers Macau—will take mainland gamblers and tourists away from Macau. Since direct flights were allowed between the People’s Republic and Taiwan in July 2008 as part of the thawing in cross-straits relations, the number of Taiwanese air passengers using Macau as a transit point has fallen dramatically. Previously, inward and outward flights to Taiwan had to connect in Macau or Hong Kong as a legacy of the political tensions dating back to the communist victory on the mainland in 1949. Mr Wu says it’s unlikely the IVS programme’s extension will similarly shrink the market for Taiwanese gamblers and holidaymakers coming specifically to Macau. “It could be a five day trip to Taiwan or Singapore [from China]. But in [inbound to] Hong Kong and Macau, people can come for a leisurely two to three days or over the weekend. I believemainlanders having access to Taiwan will not affect Macau much,” says Mr Wu. He adds, however, that service standards in Macau have been suffering. Almost every available local resident has been sucked into the jobs market following the expansion of the gaming and hotel industries. Not all of them have the same high standard of training and motivation that such service industries require, suggests Mr Wu. “In recent years, the quality of service has dropped. Currently, Macau is considered one of the high-consumption tourist destinations, so I believe good quality service is a must, so that visitors are left satisfied and get their value for money,” he states. Macau June revenue jumps 52% year on year Macau’s gross gaming revenue soared 52% in June from a year earlier to MOP20.79 billion(US$2.59 billion), according to data from Macau’s Gaming Inspection and Coordination Bureau (DICJ). June’s year on year growth rate is the highest this year, but the total revenue recorded fell short of the record high of MOP24.31 billion achieved in May, which was bolstered by the Golden Week holiday season following Labour Day on 1st May and the 15th May opening of the new Galaxy Macau resort. In the January-June period, Macau’s gambling revenue rose 45% year on year, following 58% growth for the whole of last year. AndyWu Galaxy Macau