What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-10-20 compared with 2023-07-21 · 220 added, 187 removed, 734 unchanged (36% of the section changed)

13 unchanged sentences

Since then, visitation to our Macao Integrated Resorts and operations have improved.

The Macao government announced total visitation from mainland China to Macao increased approximately 118.3% and decreased approximately 50.1%, during the five months ended May 31, 2023 (the latest statistics currently available), as compared to the same period in 2022 and 2019 (pre-pandemic), respectively.

The Macao government also announced gross gaming revenue increased approximately 205.1% and decreased approximately 46.4%, during the six months ended June 30, 2023, as compared to the same period in 2022 and 2019, respectively.

The Macao government announced total visitation from mainland China to Macao increased approximately 243.6% and decreased approximately 39.7%, during the eight months ended August 31, 2023 (the latest statistics currently available), as compared to the same period in 2022 and 2019 (pre-pandemic), respectively.

The Macao government also announced gross gaming revenue increased approximately 779.7% and decreased approximately 31.1%, during the three months ended September 30, 2023, as compared to the same period in 2022 and 2019, respectively.

Additionally, gross gaming revenue increased approximately 305.3% and decreased approximately 41.5%, during the nine months ended September 30, 2023, as compared to the same period in 2022 and 2019, respectively.

From 2020 through early 2022, our operations in Singapore were negatively impacted by the reduction in travel and tourism related to the COVID-19 pandemic.

1 unchanged sentence

During February 2023, any remaining COVID-19 border measures were lifted.

Airlift passenger movement has increased with 15 million passengers having passed through Singapore's Changi Airport from January through May 2023 (the latest statistics currently available), an increase of 222% and a decrease of 18% compared to the same period in 2022 and 2019, respectively.

Airlift passenger movement has increased with a total of 38 million passengers having passed through Singapore's Changi Airport from January through August 2023 (the latest statistics currently available), an increase of 130% and a decrease of 16% compared to the same period in 2022 and 2019, respectively.

Visitation to Marina Bay Sands continues to improve since the travel restrictions have been lifted.

The Singapore Tourism Board (“STB”) announced total visitation to Singapore increased from approximately 1.5 million in 2022 to 6.3 million for the six months ended June 30, 2023, while visitation decreased 32.6% when compared to the same period in 2019.

The Singapore Tourism Board (“STB”) announced total visitation to Singapore increased from approximately 3.7 million in 2022 to 10.1 million for the nine months ended September 30, 2023, while visitation decreased 29.2% when compared to the same period in 2019.

While the disruptions arising from the COVID-19 pandemic have subsided, given the dynamic nature of these circumstances, the potential future impact, if any, on our consolidated results of operations, cash flows and financial condition is uncertain.

However, we have a strong balance sheet and sufficient liquidity in place, including total unrestricted cash and cash equivalents of $5.77 billion and access to $1.50 billion, $1.74 billion and $435 million of available borrowing capacity from our LVSC Revolving Facility, 2018 SCL Revolving Facility and 2012 Singapore Revolving Facility, respectively, as of June 30, 2023.

However, we have a strong balance sheet and sufficient liquidity in place, including total unrestricted cash and cash equivalents of $5.57 billion and access to $1.50 billion, $2.24 billion and $431 million of available borrowing capacity from our LVSC Revolving Facility, 2018 SCL Revolving Facility and 2012 Singapore Revolving Facility, respectively, as of September 30, 2023.

We believe we are able to support continuing operations and complete our major construction projects that are underway.

1 unchanged sentence

For a discussion of our significant accounting policies and estimates, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” presented in our 2022 Annual Report on Form 10-K filed on February 3, 2023.

There were no newly identified significant accounting policies and estimates during the six months ended June 30, 2023, nor were there any material changes to the critical accounting policies and estimates discussed in our 2022 Annual Report.

There were no newly identified significant accounting policies and estimates during the nine months ended September 30, 2023, nor were there any material changes to the critical accounting policies and estimates discussed in our 2022 Annual Report.

Recent Accounting Pronouncements

25 unchanged sentences

Generally, slot machine play is conducted on a cash basis.

In Macao and Singapore, 10.3% and 12.5%, respectively, of our table games play was conducted on a credit basis for the six months ended June 30, 2023.

In Macao and Singapore, 10.5% and 11.7%, respectively, of our table games play was conducted on a credit basis for the nine months ended September 30, 2023.

Hotel revenue measurements:

14 unchanged sentences

Only tenants that have been open for a minimum of 12 months are included in the tenant sales per square foot calculation.

Three Months Ended June 30, 2023 Compared to the Three Months Ended June 30, 2022

Three Months Ended September 30, 2023 Compared to the Three Months Ended September 30, 2022

Summary Financial Results

The Company continues to see positive financial results in the second quarter of 2023 due to the lift of COVID-19 restrictions in Macao in January 2023 and elimination of restrictions in Singapore in April 2022, respectively.

Net revenues for the three months ended June 30, 2023, were $2.54 billion, compared to $1.05 billion for the three months ended June 30, 2022.

Operating income was $537 million for the three months ended June 30, 2023, compared to an operating loss of $147 million for the three months ended June 30, 2022.

Net income from continuing operations was $368 million for the three months ended June 30, 2023, compared to a net loss from continuing operations of $414 million for the three months ended June 30, 2022.

We continue to see positive financial results in the third quarter of 2023 due to the lift of COVID-19 restrictions in Macao beginning in late December 2022, as well as a 72.5% increase in visitation to Singapore during the third quarter of 2023, as compared to the same period in 2022, driven by a 57.4% increase in airlift passenger movement during July and August 2023 (the latest statistics currently available) as compared to the same period in 2022.

Net revenues for the three months ended September 30, 2023, were $2.80 billion, compared to $1.01 billion for the three months ended September 30, 2022.

Operating income was $688 million for the three months ended September 30, 2023, compared to an operating loss of $177 million for the three months ended September 30, 2022.

Net income from continuing operations was $449 million for the three months ended September 30, 2023, compared to a net loss from continuing operations of $380 million for the three months ended September 30, 2022.

Operating Revenues

Our net revenues consisted of the following:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Percent

6 unchanged sentences

Total net revenues $ 2,795 $ 1,005 178.1 %

Consolidated net revenues were $2.54 billion for the three months ended June 30, 2023, an increase of $1.50 billion compared to $1.05 billion for the three months ended June 30, 2022.

Consolidated net revenues were $2.80 billion for the three months ended September 30, 2023, an increase of $1.79 billion compared to $1.01 billion for the three months ended September 30, 2022.

The increase was due to increases of $1.53 billion and $258 million at our Macao operations and Marina Bay Sands, respectively.

Net casino revenues increased $1.15 billion compared to the three months ended June 30, 2022.

Net casino revenues increased $1.37 billion compared to the three months ended September 30, 2022.

The increase was due to increases of $1.18 billion and $188 million at our Macao operations and Marina Bay Sands, respectively.

The lift of COVID-19 restrictions in Macao beginning in late December 2022 and elimination of restrictions in April 2022 in Singapore has continued to result in increased visitation and table games and slot volumes across our properties.

The increase was partially offset by a decrease driven by lower win percentages.

The lift of COVID-19 restrictions in Macao beginning in late December 2022 and increased visitation

and airlift passenger movement in Singapore during the current period resulted in increased visitation across our properties driving higher table games and slot volumes.

The following table summarizes the results of our casino activity:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Change

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Slot hold percentage 3.3 % 3.4 % (0.1) pts

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Change

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In our experience, average win percentages remain fairly consistent when measured over extended periods of time with a significant volume of wagers, but can vary considerably within shorter time periods as a result of the statistical variances associated with games of chance in which large amounts are wagered.

Room revenues increased $199 million compared to the three months ended June 30, 2022.

The increase was due to increases of $151 million and $48 million at our Macao operations and Marina Bay Sands, respectively, due to increased occupancy rates and ADR driven by increased visitation as pandemic-related restrictions were lifted in Macao beginning in December 2022 and eliminated in Singapore in April 2022.

Room revenues increased $219 million compared to the three months ended September 30, 2022.

The increase was due to increases of $186 million and $33 million at our Macao operations and Marina Bay Sands, respectively, due to increased occupancy rates and ADR driven by increased visitation.

Increased visitation at our Macao operations during the current period was due to the lifting of pandemic-related restrictions in Macao that began in December 2022 and the grand opening of The Londoner Macao in May 2023.

Increased visitation to Marina Bay Sands during the quarter was due to an increase in airlift passenger movement in Singapore, as well as introducing new and elevated suites and rooms and other amenities at Marina Bay Sands throughout 2023.

The following table summarizes the results of our room activity:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Change

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Revenue per available room (RevPAR) $ 408 $ 90 353.3 %

Three Months Ended September 30,

2023 2022 Change

(Room revenues in millions)

Total room revenues $ 4 $ 1 300.0 %

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Revenue per available room (RevPAR) $ 171 $ 69 147.8 %

Three Months Ended June 30,

2023 2022 Change

Singapore Operations:

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__________________________

(1) During the three months ended June 30, 2023 and 2022, approximately 2,100 and 2,000 rooms, respectively, were available for use.

Food and beverage revenues increased $80 million compared to the three months ended June 30, 2022.

Our new outlets in Macao and Singapore and increased business volume across our food and beverage outlets and in banquet operations resulted in increases of $44 million and $36 million at our Macao operations and Marina Bay Sands, respectively.

Mall revenues increased $24 million compared to the three months ended June 30, 2022.

The increase was due to increases of $22 million in Macao, driven by a decrease in rent concessions granted to our mall tenants and an increase in turnover and overage rents, and $2 million at Marina Bay Sands, driven by an increase in base rent.

(1) During the three months ended September 30, 2023 and 2022, approximately 2,200 and 2,100 rooms, respectively, were available for use.

Food and beverage revenues increased $74 million compared to the three months ended September 30, 2022.

Increased business volume across our food and beverage outlets and in banquet operations were in line with increased property visitation resulting in increases of $56 million and $18 million at our Macao operations and Marina Bay Sands, respectively.

Mall revenues increased $82 million compared to the three months ended September 30, 2022.

The increase was due to increases of $69 million in Macao, driven by a decrease in rent concessions granted to our mall tenants and an increase in turnover and overage rents, and $13 million at Marina Bay Sands, driven by an increase in overage and base rent.

For further information related to the financial performance of our malls, see “Additional Information Regarding our Retail Mall Operations.” The following table summarizes the results of our malls on the Cotai Strip in Macao and in Singapore:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Change

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$ 1,701 $ 1,112 53.0 %

Three Months Ended September 30,

2023 2022 Change

(Mall revenues in millions)

Shoppes at Parisian

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$ 6,714 $ 4,301 56.1 %

Three Months Ended June 30,

2023 2022 Change

Singapore Operations:

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This table excludes the results of our retail outlets at Sands Macao.

As a result of the COVID-19 pandemic, tenants were provided rent concessions during the three months ended June 30, 2022.

As a result of the COVID-19 pandemic, tenants were provided rent concessions during the three months ended September 30, 2022.

Base rent per square foot presented above excludes the impact of these rent concessions.

(1) Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period.

Convention, retail and other revenues increased $41 million compared to the three months ended June 30, 2022.

The increase was primarily due to a $31 million increase at our Macao operations, primarily driven by increases of $16 million in ferry operations due to the resumption of ferry services in January 2023.

We also had increases of $8 million in retail and other revenues (e.g., limo and spa) and $5 million in entertainment revenue, driven by increased visitation.

In addition, a $10 million increase at Marina Bay Sands was driven primarily by increases of $7 million in convention revenue and $3 million in other revenues (e.g., museum, SkyPark and transportation).

Convention, retail and other revenues increased $44 million compared to the three months ended September 30, 2022.

The increase was due to a $38 million increase at our Macao operations, primarily driven by a $17 million increase in ferry operations due to the resumption of ferry services in January 2023.

Increased visitation to our Macao operations led to increases of $10 million in retail and other revenues (e.g., limo and spa) and $7 million in entertainment revenue.

Included in retail and other revenues was a $12 million insurance recovery at our Macao operations due to Typhoon Saola in September 2023.

A $6 million increase at Marina Bay Sands was driven primarily by increases of $3 million in convention revenue and $3 million in other revenues (e.g.

museum, SkyPark and transportation).

Operating Expenses

Our operating expenses consisted of the following:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Percent

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Amortization of leasehold interests in land 15 14 7.1 %

Loss on disposal or impairment of assets 4 — N.M.

Loss on disposal or impairment of assets 4 2 100.0 %

Total operating expenses $ 2,107 $ 1,182 78.3 %

__________________________

Not meaningful.

Operating expenses were $2.01 billion for the three months ended June 30, 2023, an increase of $813 million compared to $1.19 billion for the three months ended June 30, 2022, primarily driven by increases of $589 million in casino expenses, $44 million in food and beverage expenses, $41 million in general and administrative expenses, $32 million in development expenses, $32 million in depreciation and amortization, $30 million in rooms expenses and $26 million in convention, retail and other expenses.

Casino expenses increased $589 million compared to the three months ended June 30, 2022.

The increase was primarily attributable to increases of $485 million and $42 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues, increases in gaming tax rates of 1% in Macao and 3% in Singapore, and a 1% increase in value added tax in Singapore.

Room expenses increased $30 million compared to the three months ended June 30, 2022.

The increase was attributable to increases of $22 million and $8 million at our Macao operations and Marina Bay Sands, respectively, consistent with increased occupancy.

Food and beverage expenses increased $44 million compared to the three months ended June 30, 2022.

The increase was due to increases of $26 million and $18 million at Marina Bay Sands and our Macao operations, respectively, primarily driven by increased food outlet and banquet operation volumes.

Convention, retail and other expenses increased $26 million compared to the three months ended June 30, 2022, primarily driven by increases of $21 million and $5 million at our Macao operations and Marina Bay Sands, respectively.

Operating expenses were $2.11 billion for the three months ended September 30, 2023, an increase of $925 million compared to $1.18 billion for the three months ended September 30, 2022, primarily driven by increases of $693 million in casino expenses, $53 million in depreciation and amortization, $52 million in general and administrative expenses, $45 million in food and beverage expenses, $39 million in rooms expenses, $25 million in convention, retail and other expenses, and $18 million in development expenses.

Casino expenses increased $693 million compared to the three months ended September 30, 2022.

The increase was primarily attributable to increases of $574 million and $46 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues.

We also had increases in gaming tax rates of 1% in Macao and 3% in Singapore, and a 1% increase in value added tax in Singapore.

Room expenses increased $39 million compared to the three months ended September 30, 2022.

The increase was attributable to increases of $30 million and $9 million at our Macao operations and Marina Bay Sands, respectively, driven by increased occupancy in Macao and higher costs associated with the new and elevated suites and rooms introduced at Marina Bay Sands during the year.

Food and beverage expenses increased $45 million compared to the three months ended September 30, 2022.

The increase was due to increases of $29 million and $16 million at our Macao operations and Marina Bay Sands, respectively, primarily driven by increased food outlet and banquet operation volumes.

Convention, retail and other expenses increased $25 million compared to the three months ended September 30, 2022, primarily driven by increases of $21 million and $4 million at our Macao operations and Marina Bay Sands, respectively.

The increases were primarily driven by increases of $10 million in ferry operation expenses due to the resumption of ferry services in January 2023, $7 million in entertainment expenses due to increased event volume, $3 million in limo expenses, $2 million in convention expenses and $1 million in retail expenses.

Provision for credit losses was $5 million for three months ended June 30, 2023, compared to $2 million for the three months ended June 30, 2022.

The $3 million increase was primarily driven by an increase in casino provisions in Singapore consistent with credit issued associated with increased gaming volumes.

Provision for credit losses was $3 million for three months ended September 30, 2023, compared to $8 million for the three months ended September 30, 2022.

The $5 million decrease was primarily driven by a decrease in casino provisions in Singapore.

The amount of this provision can vary over short periods of time because of factors specific to the patrons who owe us money from gaming activities.

We believe the amount of our provision for credit losses in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.

General and administrative expenses increased $41 million compared to the three months ended June 30, 2022.

The increase was primarily due to increases of $22 million and $19 million at Marina Bay Sands and our Macao operations, respectively, driven by increases in payroll and marketing costs, utilities and property taxes.

Development expenses were $54 million for the three months ended June 30, 2023, compared to $22 million for the three months ended June 30, 2022.

During the three months ended June 30, 2023, the costs were associated with our evaluation and pursuit of new business opportunities, primarily in New York, Texas and digital gaming related efforts.

General and administrative expenses increased $52 million compared to the three months ended September 30, 2022.

The increase was primarily due to increases of $31 million and $21 million at our Macao operations and Marina Bay Sands, respectively, driven by increases in payroll and marketing costs, utilities and property taxes.

Development expenses were $44 million for the three months ended September 30, 2023, compared to $26 million for the three months ended September 30, 2022.

During the three months ended September 30, 2023, the costs were associated with our evaluation and pursuit of new business opportunities, primarily in New York, Texas and digital gaming related efforts.

Development costs are expensed as incurred.

Depreciation and amortization increased $32 million compared to the three months ended June 30, 2022.

The increase was primarily due to a $25 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service during the second quarter.

Loss on disposal or impairment of assets was $4 million for three months ended June 30, 2023.

The losses incurred for the three months ended June 30, 2023, were primarily due to $2 million in demolition costs related to the renovation at Marina Bay Sands.

Depreciation and amortization increased $53 million compared to the three months ended September 30, 2022.

The increase was primarily due to a $32 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service during the second quarter and a $21 million increase at our Macao operations primarily as a result of accelerated depreciation related to the second phase of the renovations at The Londoner Macao and amortization of the intangible asset related to the Macao gaming concession.

Loss on disposal or impairment of assets was $4 million for three months ended September 30, 2023.

The losses incurred for the three months ended September 30, 2023, were primarily due to $2 million in demolition costs related to the renovation at Marina Bay Sands.

Segment Adjusted Property EBITDA

The following table summarizes information related to our segments:

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 Percent

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As a result, our presentation of consolidated adjusted property EBITDA may not be directly comparable to similarly titled measures presented by other companies.

Three Months Ended June 30,

Three Months Ended September 30,

(In millions)

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Interest expense, net of amounts capitalized (200) (183)

Other income (expense) 14 (9)

Income tax (expense) benefit (49) (110)

Income tax expense

Net income (loss) from continuing operations $ 449 $ (380)

__________________________

(a) During the three months ended June 30, 2023 and 2022, we recorded stock-based compensation expense of $20 million and $15 million, respectively, of which $12 million and $9 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.

Adjusted property EBITDA at our Macao operations increased $651 million compared with the three months ended June 30, 2022, primarily due to increases in casino, room, food and beverage and mall revenues due to increased visitation at our Macao properties driven by the lift of most COVID-19 restrictions in late December 2022 and early January 2023.

Adjusted property EBITDA at Marina Bay Sands increased $113 million compared to the three months ended June 30, 2022, primarily due to increases in casino, room, food and beverage and mall revenues due to the reopening of borders and elimination of pandemic-related restrictions in April 2022.

(a) During the three months ended September 30, 2023 and 2022, we recorded stock-based compensation expense of $16 million and $18 million, respectively, of which $10 million and $9 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.

Adjusted property EBITDA at our Macao operations increased $783 million compared with the three months ended September 30, 2022, primarily due to increases in revenues across our operations due to increased visitation at our Macao properties driven by the lift of most COVID-19 restrictions in late December 2022 and early January 2023.

Adjusted property EBITDA at Marina Bay Sands increased $148 million compared to the three months ended September 30, 2022, primarily due to increases in revenues across our operations driven by increased visitation and airlift passenger movement in Singapore, as well as new and elevated suites and rooms and other amenities introduced at Marina Bay Sands during the year.

Interest Expense

The following table summarizes information related to interest expense:

Three Months Ended June 30,

Three Months Ended September 30,

(Dollars in millions)

5 unchanged sentences

Weighted average interest rate

Interest cost increased $49 million compared to the three months ended June 30, 2022, primarily resulting from an increase in the weighted average interest rate from 4.3% to 5.4% during the three months ended June 30, 2023 when compared to the three months ended June 30, 2022.

This is due to the increase in the underlying benchmark rates on our SCL Revolving Facility and our Singapore Credit Facility, and the increase in interest rates on the SCL senior notes as a result of the credit rating downgrade to BB+ by S&P in February 2022, and by Fitch in June 2022.

Interest cost was also impacted by an overall net increase in our weighted average total debt balance.

Interest cost increased $18 million compared to the three months ended September 30, 2022, primarily resulting from an increase in the weighted average interest rate from 4.8% to 5.4% during the three months ended September 30, 2023 when compared to the three months ended September 30, 2022.

This is due to the increase in the underlying benchmark rates on our SCL Revolving Facility and our Singapore Credit Facility.

Interest cost was also impacted by an overall decrease in our weighted average total debt balance, due primarily to the $1.20 billion and $500 million paid on the SCL Revolving Facility in May 2023 and August 2023, respectively, partially offset by the addition of the $201 million finance lease entered into in June 2023 for the New York land lease.

$8 million in imputed interest expense on the Macao gaming concession financial liability in the third quarter of 2023.

Other Factors Affecting Earnings

Interest income was $76 million for the three months ended June 30, 2023, compared to $14 million for the three months ended June 30, 2022.

Interest income during the three months ended June 30, 2023, was primarily attributable to $69 million in interest income on money market funds and bank deposits driven by higher market interest rates.

We also had $7 million in interest income on the seller financing loan provided in connection with the sale of the Las Vegas properties.

Other income was $14 million for the three months ended June 30, 2023, compared to other expense of $9 million for the three months ended June 30, 2022.

Other income during the three months ended June 30, 2023, was primarily attributable to $9 million of foreign currency transaction gains driven by the U.S.

Interest income was $79 million for the three months ended September 30, 2023, compared to $38 million for the three months ended September 30, 2022, an increase of $41 million.

The increase was attributable to an increase of interest income on money market funds, bank deposits and treasury bills driven by higher market interest rates.

Our average interest rate on cash and cash equivalents during the three months ended September 30, 2023 was 5.6%, compared to 2.1% for the three months ended September 30, 2022.

Other income was $4 million for the three months ended September 30, 2023, compared to $2 million for the three months ended September 30, 2022.

Other income during the three months ended September 30, 2023, was primarily attributable to foreign currency transaction gains driven by the U.S.

dollar-denominated debt held by Sands China Ltd.

(“SCL”) and $4 million of foreign currency transaction gains driven by U.S dollar-denominated intercompany debt held by Marina Bay Sands Pte.

Our income tax expense was $49 million on income before income taxes of $417 million for the three months ended June 30, 2023, resulting in an 11.8% effective income tax rate.

This compares to a 36.2% effective income tax rate for the three months ended June 30, 2022.

The income tax expense for the three months ended June 30, 2023, reflects a 17% statutory tax rate on our Singapore operations and a 21% corporate income tax on our domestic operations.

Our operations in Macao are subject to a 12% statutory income tax rate, but in connection with the 35% gaming tax, our subsidiaries in Macao and their peers received an income tax exemption on gaming operations through December 31, 2022.

Our income tax expense is based on our estimated annual effective tax rate for the year applied to year-to-date operating results in accordance with interim accounting guidelines.

We have had the benefit of a corporate tax exemption in Maca o, which exempts us from paying the 12% corporate income tax on profits generated by the operation of casino games, but does not apply to our non-gaming activities.

We continued to benefit from this tax exemption through December 31, 2022.

Additionally, we entered into a shareholder dividend tax agreement with the Macao government in April 2019, effective through June 26, 2022, providing an annual payment as a substitution for a 12% tax otherwise due from Venetian Macau Limited (“VML,” a subsidiary of SCL) shareholders on dividend distributions paid from VML gaming profits.

Our income tax expense was $122 million on income before income taxes of $571 million for the three months ended September 30, 2023, resulting in an 21.4% effective income tax rate.

This compares to a 18.8% effective income tax rate for the three months ended September 30, 2022.

The income tax expense for the three months ended September 30, 2023, reflects a 17% statutory tax rate on our Singapore operations and a 21% corporate income tax on our domestic operations.

Our operations in Macao are subject to a 12% statutory income tax rate, but in connection with the 35% gaming tax, Venetian Macao Limited (“VML,” a subsidiary of SCL) and its peers received an income tax exemption on gaming operations through December 31, 2022.

Additionally, we entered into a shareholder dividend tax agreement with the Macao government in April 2019, effective through June 26, 2022, providing an annual payment as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits.

In December 2022, we requested a corporate tax exemption on profits generated by the operation of casino games in Macao for the new gaming concession period effective from January 1, 2023 through December 31, 2032, or for a period of corporate tax exemption that the Chief Executive of Macao may deem more appropriate.

We are evaluating the timing of an application for a new shareholder dividend tax agreement.

There is no assurance either of these arrangements will be granted.

The net income attributable to our noncontrolling interests was $56 million for the three months ended June 30, 2023, compared to a net loss attributable to our noncontrolling interests of $127 million for the three months ended June 30, 2022.

These amounts are related to the noncontrolling interest of SCL.

Six Months Ended June 30, 2023 Compared to the Six Months Ended June 30, 2022

We are evaluating the timing of an application for a new shareholder dividend tax agreement with the Macao government.

Our income tax expense is based on our estimated annual effective tax rate for the year applied to year-to-date operating results in accordance with interim accounting guidelines.

The net income attributable to our noncontrolling interests was $69 million for the three months ended September 30, 2023, compared to a net loss attributable to our noncontrolling interests of $142 million for the three months ended September 30, 2022.

These amounts were related to the noncontrolling interest of SCL.

Nine Months Ended September 30, 2023 Compared to the Nine Months Ended September 30, 2022

Operating Revenues

Our net revenues consisted of the following:

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Percent

6 unchanged sentences

Total net revenues $ 7,457 $ 2,993 149.1 %

Consolidated net revenues were $4.66 billion for the six months ended June 30, 2023, an increase of $2.67 billion compared to $1.99 billion for the six months ended June 30, 2022, due primarily to an increase of $1.98 billion at our Macao operatio ns.

Consolidated net revenues were $7.46 billion for the nine months ended September 30, 2023, an increase of $4.46 billion compared to $2.99 billion for the nine months ended September 30, 2022, due primarily to an increase of $3.51 billion at our Macao operatio ns.

The increase at our Macao operations was due to increased visitation as COVID-19 restrictions were lifted in Macao and the surrounding region in late December 2022 and early January 2023.

In addition, a $952 million increase at Marina Bay Sands was primarily due to increased visitation resulting from the reopening of borders and elimination of pandemic-related restrictions in April 2022.

Net casino revenues increased $2.07 billion compared to the six months ended June 30, 2022.

Net casino revenues increased $3.44 billion compared to the nine months ended September 30, 2022.

The increase was driven by a $2.78 billion increase at our Macao operations due to increased visitation across our properties resulting in increased table games and slot volumes.

2 unchanged sentences

The following table summarizes the results of our casino activity:

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Change

33 unchanged sentences

Slot hold percentage 5.9 % 9.7 % (3.8) pts

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Change

16 unchanged sentences

Slot hold percentage 3.9 % 4.3 % (0.4) pts

Room revenues increased $347 million compared to the six months ended June 30, 2022.

The increase was due to increases of $240 million and $107 million at our Macao operations and Marina Bay Sands, respectively, due to increased occupancy rates and ADR driven by increased visitation as pandemic-related restrictions were lifted in Macao beginning in December 2022 and eliminated in Singapore in April 2022.

Room revenues increased $566 million compared to the nine months ended September 30, 2022.

The increase was due to increases of $426 million and $140 million at our Macao operations and Marina Bay Sands, respectively.

Macao room revenues increased as a result of an increase in occupancy rates and ADR, driven by increased visitation as pandemic-related restrictions were lifted beginning in December 2022 and the grand opening of The Londoner Macao in May 2023.

At Marina Bay Sands, room revenues increased due to the elimination of pandemic-related restrictions in April 2022, and from the introduction of new and elevated suites and rooms and other amenities.

The following table summarizes the results of our room activity:

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Change

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__________________________

(1) During the six months ended June 30, 2023 and 2022, approximately 2,000 and 2,100 rooms, respectively, were available for use.

Food and beverage revenues increased $151 million compared to the six months ended June 30, 2022.

The increase was due to increases of $84 million and $67 million at Marina Bay Sands and our Macao operations, respectively, driven by new outlets and increased business volume at food and beverage outlets and banquet operations.

Mall revenues increased $37 million compared to the six months ended June 30, 2022.

The increase of $31 million in our Macao operation was driven by a $40 million increase due to a decrease in rents concessions and an increase in overage rent, partially offset by a $10 million decrease in base rent.

The $6 million increase at Marina Bay Sands was driven by a $5 million increase in base and overage rents.

(1) During the nine months ended September 30, 2023 and 2022, approximately 2,000 and 2,100 rooms, respectively, were available for use.

Food and beverage revenues increased $225 million compared to the nine months ended September 30, 2022.

The increase was due to increases of $123 million and $102 million at our Macao operations and Marina Bay Sands, respectively, driven by new outlets and increased business volume at food and beverage outlets and banquet operations.

Mall revenues increased $119 million compared to the nine months ended September 30, 2022.

The increase of $100 million in our Macao operation was primarily driven by a $101 million increase due to a decrease in rent concessions and an increase in overage rent, partially offset by a $4 million decrease in base rent.

The $19 million increase at Marina Bay Sands was driven by a $9 million increase in overage rent and a $7 million increase in base rent.

Six Months Ended June 30, (1)

Nine Months Ended September 30, (1)

2023 2022 Change

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This table excludes the results of our retail outlets at Sands Macao.

As a result of the COVID-19 pandemic, tenants were provided rent concessions during the six months ended June 30, 2022.

As a result of the COVID-19 pandemic, tenants were provided rent concessions during the nine months ended September 30, 2022.

Base rent per square foot presented above excludes the impact of these rent concessions.

(1) As GLA, occupancy, base rent per square foot and tenant sales per square foot are calculated as of June 30, 2023 and 2022, they are identical to the summary presented herein for the three months ended June 30, 2023 and 2022, respectively.

(1) As GLA, occupancy, base rent per square foot and tenant sales per square foot are calculated as of September 30, 2023 and 2022, they are identical to the summary presented herein for the three months ended September 30, 2023 and 2022, respectively.

(2) Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period.

Convention, retail and other revenues increased $72 million compared to the six months ended June 30, 2022, due primarily to increases of $49 million and $23 million at our Macao operations and Marina Bay Sands, respectively, driven by increases of $24 million in ferry operations due to the resumption of ferry services in January 2023, $15 million in convention revenue, $13 million in retail and other operating revenues (e.g.

limo and spa), and $10 million in entertainment revenue.

Convention, retail and other revenues increased $116 million compared to the nine months ended September 30, 2022, due primarily to increases of $87 million and $29 million at our Macao operations and Marina Bay Sands, respectively, driven by increases of $40 million in ferry operations due to the resumption of ferry services in January 2023, $20 million in convention revenue, $23 million in retail and other operating revenues (e.g.

limo and spa), including $12 million in insurance recovery due to Typhoon Saola in September 2023, and $18 million in entertainment revenue.

Operating Expenses

Our operating expenses consisted of the following:

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Percent

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Convention, retail and other 141 73 93.2 %

Provision for (recovery of) credit losses (1) 6 (116.7) %

Provision for credit losses 2 14 (85.7) %

General and administrative 820 694 18.2 %

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Total operating expenses $ 5,854 $ 3,619 61.8 %

Operating expenses were $3.75 billion for the six months ended June 30, 2023, an increase of $1.31 billion compared to $2.44 billion for the six months ended June 30, 2022.

The increase was primarily driven by a $995 million increase in casino expenses.

Casino expenses increased $995 million compared to the six months ended June 30, 2022.

The increase was primarily attributable to increases of $771 million and $129 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues, increases in gaming taxes of 1% in Macao and 3% in Singapore, and a 1% increase in value added tax in Singapore.

Room expenses increased $43 million compared to the six months ended June 30, 2023.

The increase was due to increases of $29 million and $14 million at our Macao operations and Marina Bay Sands, respectively, consistent with increased occupancy.

Food and beverage expenses increased $83 million compared to the six months ended June 30, 2022.

The increase was due to increases of $58 million and $25 million at Marina Bay Sands and our Macao operations, respectively, driven by increased business volume at food outlets and banquets operations.

Convention, retail and other expenses increased $43 million compared to the six months ended June 30, 2022, due to increases of $33 million and $10 million at our Macao operations and Marina Bay Sands, respectively.

Operating expenses were $5.85 billion for the nine months ended September 30, 2023, an increase of $2.24 billion compared to $3.62 billion for the nine months ended September 30, 2022.

The increase was primarily driven by a $1.69 billion increase in casino expenses.

Casino expenses increased $1.69 billion compared to the nine months ended September 30, 2022.

The increase was primarily attributable to increases of $1.34 billion and $175 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues.

We also had increases in gaming taxes of 1% in Macao and 3% in Singapore, and a 1% increase in value added tax in Singapore.

Room expenses increased $82 million compared to the nine months ended September 30, 2022.

The increase was due to increases of $59 million and $23 million at our Macao operations and Marina Bay Sands, respectively, consistent with increased occupancy in both Macao and Marina Bay Sands and higher costs associated with the new and elevated suites and rooms introduced at Marina Bay Sands during the year.

Food and beverage expenses increased $128 million compared to the nine months ended September 30, 2022.

The increase was due to increases of $75 million and $53 million at Marina Bay Sands and our Macao operations, respectively, driven by increased business volume at food outlets and banquets operations in line with increased property visitation.

Convention, retail and other expenses increased $68 million compared to the nine months ended September 30, 2022, due to increases of $54 million and $14 million at our Macao operations and Marina Bay Sands, respectively.

The increases were primarily due to increases of $26 million in ferry operation expenses due to the resumption of ferry services in January 2023, $16 million in entertainment expenses, $6 million in convention expenses, $3 million in limo expenses and $2 million in retail expenses.

Recovery of credit losses was $1 million for the six months ended June 30, 2023, compared to a provision for credit losses of $6 million for the six months ended June 30, 2022.

Provision for credit losses was $2 million for the nine months ended September 30, 2023, compared to $14 million for the nine months ended September 30, 2022.

The $12 million decrease was primarily driven by collections of Macao casino receivables that were fully reserved.

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General and administrative expenses increased $74 million compared to the six months ended June 30, 2022.

General and administrative expenses increased $126 million compared to the nine months ended September 30, 2022.

The increase was primarily due to increases of $69 million and $57 million at Marina Bay Sands and our Macao operations, respectively, driven by increases in payroll and marketing costs, utilities and property taxes.

Development expenses were $96 million for the six months ended June 30, 2023, compared to $82 million for the six months ended June 30, 2022.

During the six months ended June 30, 2023, the costs were associated with our evaluation and pursuit of new business opportunities primarily in New York, Texas and digital gaming related efforts.

Development expenses were $140 million for the nine months ended September 30, 2023, compared to $108 million for the nine months ended September 30, 2022.

During the nine months ended September 30, 2023, the costs were associated with our evaluation and pursuit of new business opportunities primarily in New York, Texas and digital gaming related efforts.

Development costs are expensed as incurred.

Depreciation and amortization increased $42 million compared to the three months ended June 30, 2022.

The increase was primarily due to a $35 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service during the second quarter.

Loss on disposal or impairment of assets was $18 million for the six months ended June 30, 2023, compared to $6 million for the six months ended June 30, 2022.

The losses incurred for the six months ended June 30, 2023 were primarily due to $10 million in demolition costs related to renovations at Marina Bay Sands and $7 million in disposals and demolition costs at our Macao operations.

The losses incurred for the six months ended June 30, 2022 were primarily due to asset disposals and demolition costs related to asset disposals related to aircraft parts.

Depreciation and amortization increased $95 million compared to the nine months ended September 30, 2022.

The increase was primarily due to a $68 million increase at Marina Bay Sands as a result of the completion of renovations that were placed into service during the second quarter and a $27 million increase at our Macao operations primarily as a result of accelerated depreciation related to the second phase of the renovations at The Londoner Macao and amortization of the intangible asset related to the Macao gaming concession.

Loss on disposal or impairment of assets was $22 million for the nine months ended September 30, 2023, compared to $8 million for the nine months ended September 30, 2022.

The losses incurred for the nine months ended September 30, 2023 were primarily due to $13 million in demolition costs related to renovations at Marina Bay Sands and $9 million in disposals and demolition costs at our Macao operations.

The losses incurred for the nine months ended September 30, 2022 were primarily due to asset disposals and demolition costs related to asset disposals related to aircraft parts.

Segment Adjusted Property EBITDA

The following table summarizes information related to our segments:

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 Percent

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In particular, management utilizes consolidated adjusted property EBITDA to compare the operating profitability of our operations with those of our competitors, as well as a basis for determining certain incentive compensation.

Integrated Resort companies have historically reported adjusted property EBITDA as a supplemental performance measure to GAAP financial measures.

Integrated Resort companies have historically reported adjusted

property EBITDA as a supplemental performance measure to GAAP financial measures.

In order to view the operations of their properties on a more stand-alone basis, Integrated Resort companies, including Las Vegas Sands Corp., have historically excluded certain expenses that do not relate to the management of specific properties, such as pre-opening expense, development expense and corporate expense, from their adjusted property EBITDA calculations.

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As a result, our presentation of consolidated adjusted property EBITDA may not be directly comparable to similarly titled measures presented by other companies.

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions)

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____________________

(a) During the six months ended June 30, 2023 and 2022, the Company recorded stock-based compensation expense of $42 million and $29 million, respectively, of which $23 million and $18 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.

Adjusted property EBITDA at our Macao operations increased $1.06 billion compared to the six months ended June 30, 2022, primarily due to increased casino, mall and room operations driven by increased visitation at our properties due to the lift of COVID-19 restrictions in late December 2022 and early January 2023.

Adjusted property EBITDA at Marina Bay Sands increased $386 million compared to the six months ended June 30, 2022.

The increase was primarily due to increased casino, room, food and beverage and mall operations due to the reopening of borders and elimination of most pandemic-related restrictions in April 2022.

(a) During the nine months ended September 30, 2023 and 2022, the Company recorded stock-based compensation expense of $58 million and $47 million, respectively, of which $33 million and $27 million, respectively, was included in corporate expense in the accompanying condensed consolidated statements of operations.

Adjusted property EBITDA at our Macao operations increased $1.84 billion compared to the nine months ended September 30, 2022, primarily due to increased casino and room revenues driven by increased visitation at our properties due to the lift of COVID-19 restrictions in late December 2022 and early January 2023.

Adjusted property EBITDA at Marina Bay Sands increased $534 million compared to the nine months ended September 30, 2022.

The increase was primarily due to increased revenues across our operations driven by the reopening of borders and elimination of most pandemic-related restrictions in April 2022, as well as introducing new and elevated suites and rooms and other amenities at Marina Bay Sands during the year.

Interest Expense

The following table summarizes information related to interest expense:

Six Months Ended June 30,

Nine Months Ended September 30,

(Dollars in millions)

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Weighted average interest rate

Interest cost increased $111 million compared to the six months ended June 30, 2022, primarily resulting from an increase in the weighted average interest rate from 4.3% to 5.4% during the six months ended June 30, 2023 when compared to the six months ended June 30, 2022.

This is due to the increase in the underlying benchmark rate on our SCL Revolving Facility and our Singapore Credit Facility, and the increase in interest rates on the SCL senior notes as a result of the credit rating downgrade to BB+ by S&P in February 2022, and by Fitch in June 2022.

Interest cost was also impacted by an overall net increase in our weighted average total debt balance.

Interest cost increased $129 million compared to the nine months ended September 30, 2022, primarily resulting from an increase in the weighted average interest rate from 4.4% to 5.4% during the nine months ended September 30, 2023, when compared to the nine months ended September 30, 2022.

This is due to the increase in the underlying benchmark rates on our SCL Revolving Facility and our Singapore Credit Facility.

Interest cost was also impacted by an overall increase in our weighted average total debt balance, primarily due to the $1.20 billion drawn on the SCL Revolving Facility in 2022, and the addition of the $201 million finance lease entered into in June 2023 for the New York land lease.

This increase was offset by the $1.20 billion and $500 million paid on the SCL Revolving Facility in May 2023 and August 2023, respectively.

We also had $23 million in imputed interest expense on the Macao gaming concession financial liability in 2023.

Other Factors Affecting Earnings

Interest income was $146 million for the six months ended June 30, 2023, compared to $18 million for the six months ended June 30, 2022.

Interest income during the six months ended June 30, 2023 was primarily attributable to $131 million in interest income on money market funds and bank deposits driven by higher interest rates.

We also had $14 million in interest income on the seller financing loan provided in connection with the sale of the Las Vegas properties.

Other expense was $21 million for the six months ended June 30, 2023, compared to $31 million for the six months ended June 30, 2022.

Other expense during the six months ended June 30, 2023, was primarily attributable to $35 million of foreign currency transaction losses driven by U.S.

Interest income was $225 million for the nine months ended September 30, 2023, compared to $56 million for the nine months ended September 30, 2022, an increase of $169 million, which was primarily attributable to an increase of $159 million in interest income on money market funds, bank deposits and treasury bills driven by higher interest rates.

Our average interest rates on cash and cash equivalents during the nine months ended September 30, 2023 was 4.9%, compared to 1.1% for the nine months ended September 30, 2022.

We also had an increase of $8 million in interest income on the seller financing loan provided in connection with the sale of the Las Vegas properties due to an increase in the interest rate as the buyer elected payment-in-kind for the interest payments effective July 1, 2022 and an increase in the period in which the loan balance was outstanding in 2023.

Other expense was $17 million for the nine months ended September 30, 2023, compared to $29 million for the nine months ended September 30, 2022.

Other expense during the nine months ended September 30, 2023, was primarily attributable to $27 million of foreign currency transaction losses driven by U.S.

dollar denominated debt held by SCL, partially offset by $12 million of foreign currency transaction gains at MBS.

Our income tax expense was $99 million on income before income taxes of $612 million for the six months ended June 30, 2023, resulting in a 16.2% effective income tax rate.

This compares to a 14.4% effective income tax rate for the six months ended June 30, 2022.

The income tax expense for the six months ended June 30, 2023, reflects a 17% statutory tax rate on our Singapore operations and a 21% corporate income tax on our domestic operations.

Our income tax expense was $221 million on income before income taxes of $1.18 billion for the nine months ended September 30, 2023, resulting in a 18.7% effective income tax rate.

This compares to a 15.6% effective income tax rate for the nine months ended September 30, 2022.

The income tax expense for the nine months ended September 30, 2023, reflects a 17% statutory tax rate on our Singapore operations and a 21% corporate income tax on our domestic operations.

Our operations in Macao are subject to a 12% statutory income tax rate, but in connection with the 35% gaming tax, VML and its peers received an income tax exemption on gaming operations through December 31, 2022.

Additionally, we entered into a shareholder dividend tax agreement with the Macao government in April 2019, effective through June 26, 2022, providing an annual payment as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits.

We are evaluating the timing of an application for a new shareholder dividend tax agreement with the Macao government.

Our income tax expense is based on our estimated annual effective tax rate for the year applied to year-to-date operating results in accordance with interim accounting guidelines.

The net income attributable to our noncontrolling interests was $54 million for the six months ended June 30, 2023, compared to a net loss attributable to our noncontrolling interests of $228 million for the six months ended June 30, 2022.

These amounts were primarily related to the noncontrolling interest of SCL.

The net income attributable to our noncontrolling interests was $123 million for the nine months ended September 30, 2023, compared to a net loss attributable to our noncontrolling interests of $370 million for the nine months ended September 30, 2022.

These amounts were related to the noncontrolling interest of SCL.

Additional Information Regarding our Retail Mall Operations

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We generate our mall revenues primarily from leases with tenants through minimum base rents, overage rents, and reimbursements for common area maintenance (“CAM”) and other expenditures.

The following tables summarize the results of our mall operations on the Cotai Strip and at Marina Bay Sands for the three and six months ended June 30, 2023 and 2022:

The following tables summarize the results of our mall operations on the Cotai Strip and at Marina Bay Sands for the three and nine months ended September 30, 2023 and 2022:

Venetian Shoppes at

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(In millions)

For the three months ended June 30, 2023

For the three months ended September 30, 2023

Mall revenues:

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$ 5 $ 4 $ 4 $ 1 $ 10

For the three months ended June 30, 2022

For the three months ended September 30, 2022

Mall revenues:

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(In millions)

For the six months ended June 30, 2023

For the nine months ended September 30, 2023

Mall revenues:

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$ 18 $ 11 $ 10 $ 5 $ 26

For the six months ended June 30, 2022

For the nine months ended September 30, 2022

Mall revenues:

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In April 2019, our wholly owned subsidiary, MBS and the STB entered into a development agreement (the “Second Development Agreement”) pursuant to which MBS has agreed to construct a development, which will include a hotel tower with luxury rooms and suites, a rooftop attraction, convention and meeting facilities and a state-of-the-art live entertainment arena with approximately 15,000 seats (the “MBS Expansion Project”).

The Second Development Agreement provides for a total minimum project cost of approximately 4.50 billion Singapore dollars (“SGD,” approximately $3.32 billion at exchange rates in effect on June 30, 2023).

The Second Development Agreement provides for a total minimum project cost of approximately 4.50 billion Singapore dollars (“SGD,” approximately $3.29 billion at exchange rates in effect on September 30, 2023).

The estimated cost and timing of the total project will be updated as we complete design and begin construction.

We expect the total project cost will materially exceed the amounts referenced above from April 2019 based on current market conditions due to inflation, higher material and labor costs and other factors.

We have incurred approximately $1.07 billion as of June 30, 2023, inclusive of the payment made in 2019 for the lease of the parcels of land underlying the MBS Expansion Project site.

We have incurred approximately $1.08 billion as of September 30, 2023, inclusive of the payment made in 2019 for the lease of the parcels of land underlying the MBS Expansion Project site.

On March 22, 2023, MBS and the STB entered into a supplemental agreement (the “Supplemental Agreement”), which further extended the construction commencement date to April 8, 2024 and the construction completion date to April 8, 2028, and allowed for changes to the construction and operation plans under the Second Development Agreement.

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We do not anticipate material spend related to the MBS Expansion Project prior to the delivery of these items to lenders.

We are also accomplishing the approximately $1.0 billion renovation of Marina Bay Sands, which will introduce world-class suites in Tower 1 and Tower 2, and substantially upgrade the overall guest experience for premium customers.

This project is in addition to our previously announced plans for the MBS Expansion Project and is expected to be completed by the end of 2023.

Under the Concession, we are required to invest a minimum of 30.24 billion patacas (approximately $3.75 billion at exchange rates in effect on June 30, 2023) in certain gaming and non-gaming projects in Macao by December 2032.

We are nearing completion of the renovation of Towers 1 and 2 of Marina Bay Sands.

This renovation has introduced world class suites and other luxury amenities at a cost estimated at approximately $1.0 billion upon completion.

We also announced the next phase with the renovation of the Tower 3 hotel rooms into world class suites and other property changes at an estimated cost of approximately $750 million.

These renovations at Marina Bay Sands are substantially upgrading the overall guest experience for our premium customers, including new dining and retail experiences, and upgrading the casino floor, among other things.

These projects are in addition to the previously announced plans for the MBS Expansion Project.

Under the Concession, we are required to invest a minimum of 30.24 billion patacas (approximately $3.75 billion at exchange rates in effect on September 30, 2023) in certain gaming and non-gaming projects in Macao by December 2032.

The specific investments to be carried out are determined annually by VML and proposed to the Macao government for approval.

These investments will be in connection with, among others, attracting

international visitors to Macao, conventions and exhibitions, entertainment shows, sporting events, culture and art, health and wellness, themed attractions, supporting Macao’s position as a city of gastronomy, and increasing community and maritime tourism.

We expect to invest 27.80 billion patacas (approximately $3.44 billion at exchange rates in effect on June 30, 2023) in non-gaming projects.

These investments will be in connection with, among others, attracting international visitors to Macao, conventions and exhibitions, entertainment shows, sporting events, culture and art, health and wellness, themed attractions, supporting Macao’s position as a city of gastronomy, and increasing community and maritime tourism.

We expect to invest 27.80 billion patacas (approximately $3.45 billion at exchange rates in effect on September 30, 2023) in non-gaming projects.

VML submitted the list of investments and projects it intends to carry out in 2023 to the Macao government on March 31, 2023, which has been approved by the Macao government.

We have commenced works on Phase II of the Londoner Macao, which includes the renovation of the rooms in the Sheraton and Conrad hotel towers and the addition of new attractions, dining, retail and entertainment offerings.

These projects have a total estimated cost of $1.0 billion .

We continue to evaluate additional development projects in each of our markets and pursue new development opportunities globally.

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Our cash flows consisted of the following:

Six Months Ended June 30,

Nine Months Ended September 30,

(In millions)

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Tax withholding on vesting of equity awards (1) (1)

Dividends paid

Proceeds from long-term debt — 700

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Operating cash flows are generally affected by changes in operating income, accounts receivable, gaming related liabilities and interest payments.

Cash flows from operating activities for the six months ended June 30, 2023, increased $2.07 billion as compared to the six months ended June 30, 2022.

The increase in cash generated from operations was primarily due to our Macao and Singapore operations generating increased operating income driven by the acceleration of visitation and the elimination of most pandemic-related restrictions in Singapore, beginning in April 2022, and in Macao, beginning in late December 2022, and increased working capital associated with gaming liabilities.

Cash flows from

operating activities for the nine months ended September 30, 2023, increased $3.06 billion as compared to the nine months ended September 30, 2022.

Cash Flows — Investing Activities

Capital expenditures for the six months ended June 30, 2023, totaled $362 million.

Capital expenditures for the nine months ended September 30, 2023, totaled $692 million.

Included in this amount was $400 million for construction activities at Marina Bay Sands in Singapore and $124 million for construction and development activities in Macao, which consisted of $66 million for The Londoner Macao, $44 million for The Venetian Macao, $8 million for The Plaza Macao and Four Seasons Macao, $3 million for Sands Macao and $3 million for The Parisian Macao.

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Included in net cash flows from investing activities was a payment of $221 million related to the purchase of the Nassau Coliseum.

Capital expenditures for the six months ended June 30, 2022, totaled $335 million.

Included in this amount was $151 million for construction and development activities in Macao, which consisted of $118 million for The Londoner Macao, $25 million for The Venetian Macao, $5 million for The Plaza Macao and Four Seasons Macao, $2 million for Sands Macao and $1 million for the Parisian Macao.

Additionally, this amount included $147 million at Marina Bay Sands in Singapore and $37 million for corporate and other costs.

Capital expenditures for the nine months ended September 30, 2022, totaled $504 million.

Included in this amount was $255 million at Marina Bay Sands in Singapore and $199 million for construction and development activities in Macao, which consisted of $153 million for The Londoner Macao, $35 million for The Venetian Macao, $7 million for The Plaza Macao and Four Seasons Macao, $2 million for Sands Macao and $2 million for the Parisian Macao.

Additionally, this amount included $50 million for corporate and other costs.

Cash Flows — Financing Activities

Net cash flows used in financing activities were $1.31 billion for the six months ended June 30, 2023, which was primarily attributable to $1.29 billion in repayments on long-term debt primarily related to the repayment on the SCL revolving facility of $1.20 billion and $21 million in other financial liability payments.

Net cash flows generated from financing activities were $5.69 billion for the six months ended June 30, 2022, which was primarily attributable to the net proceeds from the sale of the Las Vegas properties of $4.89 billion.

Net cash flows used in financing activities were $2.01 billion for the nine months ended September 30, 2023, which was primarily attributable to $1.80 billion in repayments on long-term debt, primarily related to the repayment on the SCL revolving facility of $1.70 billion, $153 million in dividend payments, $32 million in deferred offering costs primarily relating to the amendment and restatement of the 2018 SCL Credit Facility and $25 million in other financial liability payments.

Net cash flows generated from financing activities were $5.67 billion for the nine months ended September 30, 2022, which was primarily attributable to the net proceeds from the sale of the Las Vegas properties of $4.89 billion.

Additionally, $700 million was received from the drawdown of our SCL revolving facility.

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Our U.S., SCL and Singapore credit facilities, as amended, contain various financial covenants, which include maintaining a maximum leverage ratio, as defined per the respective facility agreements.

As of June 30, 2023, our U.S.

As of September 30, 2023, our U.S.

and Singapore leverage ratios, as defined per the respective credit facility agreements, were 3.5x and 2.0x, respectively, compared to the maximum leverage ratios allowed of 4.0x and 4.5x, respectively.

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(c) amended the definition of consolidated total debt such that it excludes any financial indebtedness that is subordinated and subject in right of payment to the prior payment in full of the A&R Facility Agreement (including the $1.0 billion subordinated unsecured term loan facility made available by the Company to SCL);

(d) amended the maximum permitted consolidated leverage ratio as of the last day of each of the financial quarters ending March 31, 2024, June 30, 2024, September 30, 2024, December 31, 2024, and subsequent financial quarters to be 6.25x, 5.5x, 5.0x, 4.5x, and 4.0x respectively;

and (e) extended to (and including) January 1, 2025 the period during which SCL’s ability to declare or make any dividend payment or similar distribution is restricted if at such time (x) the Total Commitments (as defined in the A&R Facility Agreement) exceed $2.0 billion by SCL’s exercise of the option to increase the Total Commitments by an aggregate amount of up to $1.0 billion and (y) the consolidated leverage ratio is greater than 4.0x, unless, after giving effect to such payment, the sum of (i) the aggregate amount of cash and cash equivalents of SCL on such date and (ii) the aggregate amount of the undrawn facility under the A&R Facility Agreement and

unused commitments under other credit facilities of SCL is greater than $2.0 billion.

Pursuant to the A&R Facility Agreement, SCL will pay a customary fee to the Extending Lenders that consented.

The amendments shall take effect with respect to the Extended Commitments on July 31, 2023.

(d) amended the maximum permitted

consolidated leverage ratio as of the last day of each of the financial quarters ending March 31, 2024, June 30, 2024, September 30, 2024, December 31, 2024, and subsequent financial quarters to be 6.25x, 5.5x, 5.0x, 4.5x, and 4.0x respectively;

Pursuant to the A&R Facility Agreement, SCL paid a customary fee to the Extending Lenders that consented.

The amendments with respect to the Extended Commitments took effect on July 31, 2023.

On January 30, 2023, LVSC entered into the Fourth Amendment with lenders to the LVSC Revolving Credit Agreement.

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and (c) extend the period during which LVSC is unable to declare or pay any dividend or other distribution, unless liquidity is greater than $1.0 billion on a pro forma basis after giving effect to such dividend or distribution, to December 31, 2023.

We held unrestricted cash and cash equivalents of approximately $5.77 billion and restricted cash of approximately $124 million as of June 30, 2023, which approximately $2.03 billion of the unrestricted amount is held by non-U.S.

We held unrestricted cash and cash equivalents of approximately $5.57 billion and restricted cash of approximately $124 million as of September 30, 2023, which approximately $1.94 billion of the unrestricted amount is held by non-U.S.

subsidiaries.

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We do not expect withholding taxes or other foreign income taxes to apply should these earnings be distributed in the form of dividends or otherwise.

We believe we have a strong balance sheet and sufficient liquidity in place, including unrestricted cash and cash equivalents of $5.77 billion and cash flow generated from operations, as well as the $3.67 billion available for borrowing under our U.S., SCL and Singapore revolving credit facilities, net of outstanding letters of credit, and SGD 3.69 billion (approximately $2.72 billion at exchange rates in effect on June 30, 2023) under our Singapore Delayed Draw Term Facility as of June 30, 2023 (only available for draws after the construction cost estimate and construction schedule for the MBS Expansion Project have been delivered to the lenders).

We believe we have a strong balance sheet and sufficient liquidity in place, including unrestricted cash and cash equivalents of $5.57 billion and cash flow generated from operations, as well as the $4.17 billion available for borrowing under our U.S., SCL and Singapore revolving credit facilities, net of outstanding letters of credit, and SGD 3.69 billion (approximately $2.70 billion at exchange rates in effect on September 30, 2023) under our Singapore Delayed Draw Term Facility as of September 30, 2023 (only available for draws after the construction cost estimate and construction schedule for the MBS Expansion Project have been delivered to the lenders).

We believe we are well positioned to support our continuing operations, maintain compliance with the financial covenants of our credit facilities and fund our working capital needs, committed and planned capital expenditures, development opportunities, debt obligations and dividend commitments, as well as meet our commitments under the Macao Concession.

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In July 2023, we announced the resumption of our return of capital program.

We reinstated our dividend program and our Board of Directors declared a quarterly dividend of $0.20 per common share (a total estimated to be approximately $153 million) to be paid on August 16, 2023, to stockholders of record on August 8, 2023.

On August 16, 2023, we paid a quarterly dividend of $0.20 per common share as part of a regular cash dividend program and, during the nine months ended September 30, 2023, recorded $153 million as a distribution against retained earnings.

In October 2023, our Board of Directors declared a quarterly dividend of $0.20 per common share (a total estimated to be approximately $153 million) to be paid on November 15, 2023, to stockholders of record on November 7, 2023.

Share Repurchase Program

On October 16, 2023, our Board of Directors authorized increasing the remaining repurchase amount of $916 million to $2.0 billion and extending the expiration date from November 2024 to November 3, 2025.

During the nine months ended September 30, 2023, no shares of our common stock were repurchased.

We intend to resume our share repurchase program in the fourth quarter of 2023.

All share repurchases of our common stock have been recorded as treasury stock.

Repurchases of our common stock are made at our discretion in accordance with applicable federal securities laws in the open market or otherwise.

The timing and actual number of shares to be repurchased in the future will depend on a variety of factors, including our financial position, earnings, cash flows, legal requirements, other investment opportunities and market conditions.

Aggregate Indebtedness and Other Contractual Obligations

As of June 30, 2023, there had been no material changes to our aggregated indebtedness and other contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022, with the exception of the extension of the maturity date for the 2018 SCL Revolving Credit Facility, a $1.20 billion repayment and the accompanying interest on this facility and the land lease related to the purchase of the Nassau Coliseum.

As of September 30, 2023, there had been no material changes to our aggregated indebtedness and other contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022, with the exception of the extension of the maturity date for the 2018 SCL Revolving Credit Facility, a $1.70 billion repayment and the accompanying interest on this facility;

the decrease in fixed interest payments on the SCL senior notes due to an upgraded credit rating from Standard & Poor’s, the decrease being effective on the first payment date after July 26, 2023;

the land lease related to the purchase of the Nassau Coliseum;

and new sponsorship and similar agreements entered into.

These transactions are summarized below:

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2018 SCL Credit Facility — Revolving $ — $ 250 $ — $ — $ 250

Fixed Interest Payments

17 657 405 303 1,382

Variable Interest Payments (3)

1 12 13 1,570 1,596

Contractual Obligations

2 91 117 90 300

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_______________________

(1) Represents the six-month period ending December 31, 2023.

(1) Represents the three-month period ending December 31, 2023.

(2) See “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 4 — Long-Term Debt” for further details on these financing transactions.

(3) Based on the 1-month rate as of June 30, 2023, Hong Kong Interbank Offered Rate (“HIBOR”) of 4.93% plus the applicable interest rate spread in accordance with the respective debt agreement.

(3) Based on the 1-month rate as of September 30, 2023, Hong Kong Interbank Offered Rate (“HIBOR”) of 5.40% plus the applicable interest rate spread in accordance with the respective debt agreement.

(4) Other consists of payments associated with the Nassau Coliseum land lease entered into June 2, 2023.

Refer to “Note 7 — Leases” for further details on this transaction.

Refer to “Note 7 — Leases” for further details on the Nassau Coliseum transaction.

(5) Consists of non-cancellable contractual obligations related to various sponsorship and similar agreements.

Refer to "Note 9 — Commitments and Contingencies" for further details on the sponsorship and similar agreements.

Special Note Regarding Forward-Looking Statements

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• our ability to invest in future growth opportunities, or attempt to expand our business in new markets and new ventures;

• the ability to execute our previously announced capital expenditure programs in Singapore, and produce future returns;

• the ability to execute our previously announced capital expenditure programs and produce future returns;

• general economic and business conditions internationally, which may impact levels of disposable income, consumer spending, group meeting business, pricing of hotel rooms and retail and mall tenant sales;

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Readers are cautioned not to place undue reliance on these forward-looking statements.

We assume no obligation to update any forward-looking statements after the date of this report as a result of new information, future events or developments, except as required by federal securities laws.

obligation to update any forward-looking statements after the date of this report as a result of new information, future events or developments, except as required by federal securities laws.

Investors and others should note we announce material financial information using our investor relations website ( https://investor.sands.com ), our company website, SEC filings, investor events, news and earnings releases, public conference calls and webcasts.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis