Las Vegas Sands President Robert Goldstein told CNBC on Thursday that the city of Las Vegas will continue to struggle financially as the coronavirus pandemic persists.
“Clearly it is a difficult time for us … and from my point of view, we have more pain around here,” Goldstein said in an interview on “The Exchange” with CNBC’s Contessa Brewer.
Goldstein’s comments come two days after the announcement that CES, the biggest tech show in the US, will be an online-only event in January due to the coronavirus, yet another blow to the Las Vegas economy, where CES is held. Last year, the multi-day event had over 171,000 attendees from around the world.
“Las Vegas … is a large-scale city any way you measure it: 150,000 bedrooms, big conventions, big banquets. Big is the word for Las Vegas, so it’s not exactly an easy place to be in this environment.” . said Goldstein, who called CES virtual “short-term hurtful” for the city.
Casino resorts in Las Vegas closed due to the coronavirus in mid-March and began reopening on June 4.
Las Vegas is a destination city that depends on tourism, especially on flying visitors. For Las Vegas to recover significantly, Goldstein said, a vaccine is needed to prevent Covid-19 or “something that changes the consumer’s perception of this virus.” “And I don’t see that happening in the short term,” said Goldstein, who is also director of operations.
Las Vegas Sands, which generates around 90% of its EBITDA from Macao and Singapore, received some relatively positive news this week as the Chinese government will begin issuing a broader visa for Macao. The company generates a little more than 60% of its income from the Chinese territory and the casino center.
“It is a step in the right direction, but not a step,” Goldstein said, because the change to the visa issuance policy has not yet covered tourists. “We are oriented to tourism.”
However, Goldstein said he believes a restart of the critical program known as an individual visit scheme, or IVS, may not be far behind. “I think it will happen during the summer or fall. It will be slow. It will not be big steps. It will be a series of small steps that will lead to a large-scale opening of the IVS for both Guangdong and all of China at some point,” he said. “What is that point, nobody really knows.”
But he added: “We know that the Asian consumer, the Chinese consumer, is very familiar with a virus environment. They are used to masks and gloves and to social distancing and temporary controls. They are not going to respond like the Americans, who had difficulties with that. We also know that they will not travel beyond China, so I think Macao will become a very favorable destination when those doors are opened. ”
Shares of Las Vegas Sands rose more than 3% on Thursday, outperforming the broader S&P 500, which was trading slightly negative. The company, founded by CEO Sheldon Adelson, reported last week that net revenue decreased 97% year-over-year for the quarter ended June 30. A net loss of $ 985 million was recorded for the quarter.
Despite the financial challenges the pandemic has presented to the company, he recently said he was extending his promise to keep employee benefits and pay until at least October 31. In a letter to employees obtained by the CNBC brewer, Adelson said he believed Las Vegas Sands was the only casino operator that did not suspend or lay off workers due to the Covid-19 crisis.
Adelson feels that “supporting people in these difficult times is the right thing to do from a moral perspective, at a time when this city is really having some incredible challenges,” Goldstein said. “But also from a commercial point of view, we believe that this pandemic will eventually disappear and we will be at the forefront of the class in terms of convenience for both customers and employees.”
– CNBC’s Contessa Brewer contributed to this report.
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