sands china ceo confident of continued market growth

With numerous casino expansion projects underway in Macau, investors are beginning to question whether the world’s biggest casino market is nearing a point of total saturation. However, Edward Tracy – president and CEO of Sands China, the Macau business arm of the Las Vegas Sands casino, expressed his confidence that there is still plenty of demand left which would absorb the additional capacity.

“If you look at supply and demand, the history in Macau is that every time supply was added the demand would rise to meet it,” Tracy was quoted as saying during a live CNBC Asia broadcast. Macau will be seeing the opening of eight new resorts over the next 36 months, with the number of hotel rooms projected to double by 2017 from the current levels reported. Low market penetration and continued improvements to accessibility in Macau would continue to drive visitation numbers, as well as a demand for gambling in the popular enclave.

In addition to the resort projects being undertaken, a series of bridges and tunnels which will connect the gambling enclave to Hong Kong, Macau and Zhuhai are currently under construction, and scheduled for completion within the next two years.

As for the current numbers experienced, 7.69 million tourists were welcomed by Macau during the first three months of the year, which is 8.7% more than last year. In addition to this, there were 5.17 million mainland tourists who visited the enclave, which is a 17.2% increase compared to last year.

Macau is the only place in China where the citizens are allowed to legally gamble within casinos, with the private VIP gaming rooms renowned for attracting high-rolling senior managers and government officials. These visits have proved to be not only lucrative for the gambling industry, but have also contributed towards the overall continued growth of this market segment.

Sands China’s latest earnings have also reflected this growth, bolstering their strong position in the market. The company posted a 66% rise in net income for the first financial quarter, and this is largely thanks to the resorts attracting more mass-market gamblers. Their listed shares on the Hong Kong stock exchange have also risen over 40% over the past 12 months.