UBS: Expects Sands China (01928) to be the only gaming operator in Macau to achieve luck-adjusted EBITDA growth.

UBS: Expects Sands China (01928) to be the only gaming operator in Macau to achieve luck-adjusted EBITDA growth. UBS released a research report stating that it expects Sands China's (01928) luck-adjusted EBITDA for the third fiscal quarter to decline by approximately 7% year-on-year and approximately 3% quarter-on-quarter. The bank also expects Sands China to become the only gaming operator to achieve luck-adjusted EBITDA growth, mainly driven by an increase in its mass market business market share. According to data published by Macau's Gaming Inspection and Coordination Bureau (DICJ), total gross gaming revenue (GGR) for the third quarter was approximately MOP 60.2 billion, down approximately 4% year-on-year and approximately 1% quarter-on-quarter, partly reflecting the impact of the World Cup. UBS expects Sands China's mass market GGR for the third fiscal quarter to decline by approximately 2% quarter-on-quarter, while VIP room GGR is expected to grow by approximately 13% quarter-on-quarter due to a higher hold rate. Overall, affected by weak GGR performance and increased seasonal operating expenses, the bank expects industry luck-adjusted EBITDA to decline by approximately 3% quarter-on-quarter. The bank noted that, by contrast, its EBITDA forecasts for SJM HOLDINGS (00880), GALAXY ENT (00027), Melco Resorts, and MGM CHINA (02282) are all below Visible Alpha market consensus estimates. UBS stated that since the third quarter, the weaker-than-expected demand recovery in Macau's gaming industry, as well as the implementation of new offshore trust tax rules, have weighed on investor sentiment. The bank expects the market to focus on the drivers behind the recent demand slowdown in the upcoming earnings results, while also assessing management's commentary on post-Golden Week performance to look for signs of demand recovery. Margin outlook will also be a focus, as gaming operators continue to push forward with cost optimization measures amid weak gaming demand.