Good day, ladies and gentlemen, and welcome to the Sands' First Quarter 2023 Earnings Conference Call. At this time, all participants have been placed on a listen-only mode, but we will open the floor for your questions and comments following the presentation. It is now my pleasure to turn the floor over to Mr. Daniel Briggs, Senior Vice President of Investor Relations at Sands. Sir, the floor is yours.

Thanks, Paul. Thank you all for joining the call today. With me today are Rob Goldstein, our Chairman and Chief Executive Officer; Patrick Dumont, our President and Chief Operating Officer; Dr. Wilfred Wong, President of Sands China; and Grant Chum, EVP of Asia Operations and COO of Sands China. Today's conference call will contain forward-looking statements. We will be making those statements under the safe harbor provision of federal securities laws. The company's actual results may differ materially from the results reflected in those forward-looking statements. In addition, we will discuss non-GAAP measures. Reconciliations to the most comparable GAAP financial measure are included in our press release. We have posted an earnings presentation on our website. We may refer to that presentation during the call. And finally, for the Q&A session, we ask those with interest to please pose one question and one follow-up question, so we might allow everyone with interest the opportunity to participate. This presentation is being recorded. I'll now turn the call over to Rob.

Thank you, Dan, and thank you for joining the call. The results speak for themselves. There is a powerful recovery underway in Macao in both gaming and the non-gaming segments. The future looks very good for both markets. Our commitment to investing in both Macao and Singapore has never wavered. In Macao, following the relaxation of travel restrictions, increased visitation has driven gaming volumes, retail sales and hotel occupancy during the quarter. In other words, business is back. Sands China is in unique position to capture the opportunities. Our diversified IR model with continuous investment in non-gaming segments MICE, hotel suites, live entertainment, retail, food and beverage, positions us well to deliver strong growth in the years ahead. Our focus is on all segments in the Macao market, including international tourists. We're excited to have the opportunity to develop -- to deploy more capital to expand our non-gaming offerings in Macao. The $3.8 billion commitment we made as part of the concession tender is just the baseline. We will invest more in this extraordinary market. I look forward to everyone having the opportunity to see, to witness The Londoner and the Four Seasons. The quality of our new products is exceptional. Marina Bay Sands delivered EBITDA of $394 million for the quarter. Mass win was an all-time property record of $549 million. Rolling volumes have nearly equalled the 2019 level. Our $1 billion suite and casino renovation program is progressing. More suite inventory will continue to come online throughout the remainder of the year. We will have 400 suites available by the end of 2023, up from just 150 prior to our renovation. Okay, let's take some questions, and please ask away.

Thank you. Ladies and gentlemen, the floor is now open for questions. [Operator Instructions] And the first question today is coming from Joe Greff from J.P. Morgan. Joe, your line is live.

Hey, everybody. Congratulations on these results.

Thanks, Joe.

Rob, Patrick or Dan, whoever wants to take this first one. In Macao, presumably, March was better than February, and February, obviously, was better than January from an EBITDA and an EBITDA margin perspective. I was hoping you can maybe help us understand maybe the margin exit rate coming out of the quarter as we head here into the second quarter. If you've reported 31% margins for the quarter, March was something much higher than that. I was hoping you can help us maybe understand the cadence of EBITDA generation by month and maybe the same thing for margins by month, just so we're, I guess, thinking about it the right way in terms of our projections going forward.

Joe, I'll ask Patrick to take it. But before I do, I'll just say, I think you have to realize, I think you do realize that Macao is in its infancy as far as a return to a more normal operating environment. It's not even -- I think we're -- it's still early days there. This first quarter is still not representation of what can happen in Macao or will happen. So, I wouldn't call it normal operating mode. And as you referenced, the acceleration in revenues is clearly there and that will accelerate margins. Patrick, you want to add some more color.

Thanks. Rob. Joe, it's an interesting question. I think we've been very focused on margins for many years at SCL. Unfortunately, operating environment during the pandemic made it very hard to see the benefit of some of the work that the team has done over the years to make the business itself more efficient. I think in the long-run, we're going to look to see some significant operating leverage and the performance out of Macao, particularly as we reach a higher level of performance in a more normalized environment. I will say that there was a material difference in performance across the quarter. January was obviously impacted because, on January 8, the opening occurred. And then, subsequent to that, February is typically a very slow month post the Lunar New Year. But March was a very exciting time. A lot of things were going full steam ahead. It's very excited to see the recovery, the increase in tourism. And so, margins did recover to a more normal level. There's a lot of noise in the quarter because of the start-up. But I think overall, our long-term outlook for margins is quite strong. I think we've done a good job managing costs historically. I think the business itself was set up to be efficient. And I think in the long-run, given the mix of business, we should see a favorable margin operating environment. Grant, I don't know if you have any comments you'd like to add to that.

Sure. Yeah, thanks, Patrick. Yeah, maybe I can just give some color on the March trends. I think, Joe, you're right, the market experienced strong recovery through the quarter. So, pretty much across all operating metrics, March was better than January and February average. I mean, just as a starting point, in Macao, overall visitations city-wide were up 22% in March versus the first two months of the year. For our portfolio, the gaming volume, non-rolling drop and slot handle were both up 10% in March versus the first two months. Rolling volumes accelerated a lot more than that during that month, not least because we're starting to get some traction on the foreign VIPs coming to Macao, to our properties. Hotel occupancy improved. Occupied room nights increased by 8% in the month versus the first two months, as we were able to operate more hotel rooms with the additional manpower that's coming on board in the second half of the first quarter, and that will significantly increase further into the second quarter. So, overall, yes, I mean, March was a very pleasing month in terms of evolving trends. And as Patrick said, operating margin did recover and did recover more in March, but hopefully this is just the beginning.

Great. Thank you for your comments there. You mentioned that 31% of your rooms in Macao were out of service related to labor constraints. Where does that stand now? And can you talk about labor constraints now? And how are you remedying that?

Sure. Rob, shall I take that?

Yes, please, Grant. Yeah, you're closest to that. Sure.

I mean, hotel room inventory, Joe, availability, the actual availability for the first quarter, yeah, was around 7,700 rooms for SCL portfolio-wide. So effectively, we were accommodating as many rooms as we could, given the manpower constraints during the quarter. As I just referenced, it did improve somewhat in March as the additional hiring of the labor came on board, and the Macao government and the labor bureau have been very supportive in helping us to bring on the labor that we need to operate, especially the hospitality side of the business, the hotel and restaurants. As we go into second quarter, we would expect that, on average, second quarter, we can reach 10,700 rooms in terms of operating capacity. So that's roughly 3,000 additional hotel rooms that we will be able to operate in the second quarter, and that, obviously, takes us up to the much close to our physical available inventory. And we will reach the 12,000 probably sometime in the third quarter, in time for the summer peak season, as additional hiring and training completes through the second quarter.

So, Grant, is it safe to say the labor issues are not event for the entire market by summertime?

Yeah, Rob, I think for most of the market, for the second quarter, it's effectively a non-issue from a hotel operating capacity. Obviously, the size of our inventories is the biggest. We'll take a little bit time to get up to full capacity, but obviously, there is a big difference already that we can see between operating 10,700 rooms versus 7,700.

Thanks, Grant. Good job.

Thank you, guys.

Okay. Thank you.

Thank you. The next question will be Carlo Santarelli from Deutsche Bank. Carlo, your line is live.

Hey, everybody, thank you. Rob, just as it pertains to MBS, obviously, now Macao has gotten up and running and you're starting to see things normalize with obviously the comments there on March. Have you guys seen anything change behaviorally? I mean, we see the results. It doesn't look like anything's changed. But I was just wondering if there was anything that you've seen change in terms of demand around either the high end or the premium mass segments in MBS post kind of resumption of activity in Macao, as it continues to ramp?

Carlo, one thing I thought I understood and I think I was wrong in that respect was the super high-end premium customer in Asia. I thought we would dominate completely in Singapore. We're seeing Singapore is doing very well. We've equalled our 2019 rolling volumes. But what surprised me to the upside is the international demand for Macao, and rolling volume in Macao has been very pleasant, much more than I thought, that we could be rolling in that market far in excess of $20 billion, $25 billion annually, this keeps going. So, there has been a pleasant surprise -- has not hurt us in Singapore if you look at the numbers, but of course, there's only so much money out there, so it might have some impact. Singapore, as you see, had record numbers on the -- the slot numbers are astounding, to be at 900-plus per unit. I've never seen that in any market I've worked in, on especially the scale of machines, the market plus our non-rolling win. To exceed 6 million a day, it's pretty extraordinary. And that's what the impediments and the big headwinds of our rooms being down, our casino being torn up and there is yet to be a recovery of the Chinese consumer into Singapore at the level I think it will get to. So, the pleasant surprise is, Macao is attracting a very strong international Asian high-end customer and yet we're doing fine in Singapore. We may be sharing a very large rolling business between Singapore and Macao for long time to come. I had that wrong pleasantly. I do think the slot business in Singapore and the non-rolling is just the beginning of a trend, a very strong trend. Once we get these rooms back and the casino and -- who knows where it goes. If we make $2.5 billion, $3 billion of those segments in the years to come, maybe. But clearly, we're very happy with the results. For Singapore to do this well this early [in the day] (ph) without a full blown China recovery, it's pretty impressive. I think, we can believe we can make $500 million a quarter in the near future when things get back to a stronger place. So, we're very pleased in both markets for different reasons.

Great. That's helpful. And then, just as a follow-up. I guess, my question is more along the lines of, are you surprised by -- when you are looking at deck, obviously, your premium mass business looks like it's recovering or I should say, your base mass business is recovering relative to the first quarter of '19, very similarly to the premium mass business. And given where visitation is today relative to '19, is that dynamic surprising to you guys at all?

It is to me. I think if we go Page 14 of our deck to see the visitation [being like] (ph) 40% and yet see a recovery where it's at, it's very encouraging for future. The trajectory of Macao feels very good to us. And as Joe alluded to, the growth between January, February, March, it looks very [indiscernible] not be encouraged when you see. We made $400 million roughly without visitation really coming back very much, without hotel rooms being fully occupied, without a lot of impediments, a lot of headwinds and yet here we are. So, yeah, it's very encouraging for us and to the market. And of course, we're the biggest beneficiary of the recovery of base mass since we -- that's our dominant position. But I want also allude to the fact that we believe with our new Londoner and Four Seasons suite and physical product, we're going to compete very favorably, not just the base mass, not just retail, we're going for the very top-end of the market as well to dominate that, and we believe we can do it in both the rolling and non-rolling segments. We have both scale in terms of suite product, but also great aesthetic. When you see what we've done, we were there, and you see the new Londoner, you see the new Four Seasons, I promise you, you will be overwhelmed with the product of quality. What that team has done is exceptional work. So, for us, we see no segment in Macao to our competitors. We want to be first in every category. I believe it's possible with our new products.

Great, thanks very much.

Rob, maybe I can just add something on the...

Yes, please, jump in, Grant.

Sorry. Okay. Just to add something to Rob's comment on the premium mass versus mass off the question, yes, it looks like from the deck that we recovered at a similar rate on the premium mass and mass win versus first quarter of 2019. But overall, in terms of volumes and headcount, it was definitely a premium mass led recovery and the quality of customer has been increasing and the spend per head. The win comparison with 2019 is more hold related issue on the premium mass segment for both 2019 and 2023. But overall, premium mass gaming volume, gaming drop and headcount recovery is faster than base mass. But I think to Rob's points, we've been essentially out competing in the premium segments in both VIP and premium mass as you can see from the market share in the first quarter. Our non-rolling drop recovered to two-thirds of the first quarter of 2019 level. That's in line with the overall market recovery in mass, despite a much bigger dependence on base mass. So, as the base mass, which has been lagging in the recovery, starts to ramp up, especially as more hotel rooms come online for city -- for the whole city and for our portfolio, and also that visitations pickup and transportation and logistics improve, we should obviously be the biggest beneficiary of that base mass recovery. And some of that you can already see in the way we've outperformed in a slot electronic gaming market. Slot handle recovering to over 73% of 2019. And that has a lot more exposure. I mean, Hong Kong base mass is a much bigger part of slot and tables, and obviously, Hong Kong base mass has recovered faster as you can see from the visitations where Hong Kong visitations are already 75% of where they were in 2019, and you can see that outperformance in electronic gaming has been strong, both in absolute terms and relative to the market.

Certainly. Thank you very much for the additional context. I appreciate it.

Thanks, Carlo. Appreciate it.

Thank you. And the next question is coming from Robin Farley from UBS. Robin, your line is live.

Great, thank you. Grant, following on your comments about the strength of the recovery being that by the premium mass side, I'm curious if you're seeing any impact at all from visa policy that is sometimes turning down kind of frequent visitors or multiple visits in a period. Sounds like it's not impacting the recovery in your view. But I'm just curious if you're seeing any impacts from that.

Grant?

Rob, shall I take that?

Please, yes.

Yeah, Robin, I think for -- if you look at the visitation, overall, we are seeing a much faster recovery from Guangdong than from the non-Guangdong provinces. I think that's for obvious reasons, the proximity, the ease with which the visitors from the neighboring province can get to Macao. From my point of view, I think the biggest impediment to a higher rate of recovery in non-Guangdong visitation is actually the amount of hotel room inventory that was unavailable in the first quarter. I mean, we're the biggest repository of hotel rooms and we're with offline by 36%. And for the city as a whole, obviously, the percentage of out of rooms availability was also very significant. So, I think people have kind of high propensity to think about coming to Macao. I think the hotel room inventory issue has been a big impediment. But that's obviously easing dramatically as we get into the second quarter. And then, transportation is still only a fraction of what it was, especially in routes like from Hong Kong to Macao. Our ferries are only 20% of where they were in 2019 during the first quarter. And yeah, obviously, the visitation from Hong Kong has been so strong. So, I think overall, the visitation recovery is progressing very well, but you've got to bear in mind a couple of those pain points that are both, I think, I would say, easing quite significantly, and that's the hotel room inventory and the transportation.

Great, and that's helpful. Thanks. And then, just as my follow-up, if I could. Understanding, it's going to take a couple of quarters for all your hotel rooms to be up and running, at that point, when you think about the run rate where you are for operating expense, how would you compare that to 2019? Is there any kind of permanent reduction in some way in operating expense? Or in fact is -- does the labor issue, mean that costs are going to be higher when you're kind of fully ramped up? Thanks.

Take it, Grant.

Yeah. I think clearly we -- as we add headcount to man, to operate all of our inventory on the hospitality side, our payroll cost will start to go up. But obviously, we expect the revenue to be rebounding a lot more. So, I think this is just the ordinary course of ramping up the capacity. We achieved multiple rounds of cost savings over the years. After the 2014 downturn, we achieved some sustainable savings from that round. We made some additional structural cost savings on our expenses during the pandemic, and we hope to hold on to some of those savings. But, in terms of the labor portion, absolutely we have to invest in the manpower to get our assets back up to full operating capacity and, obviously, the cost will grow in line with that. But clearly, we want to be operating 12,000 rooms, not 7,700. So, this is something we're trying to do as quickly as we can.

Great, thanks very much.

Thank you. The next question is coming from Shaun Kelley from Bank of America. Shaun. your line is live.

Hi, great. Thanks. Just, maybe to start, if we could go back to a couple of your comments, Rob, on that base mass versus some of the premium mass mix and the surprise there. I mean, is -- a healthy way to think about the mix that we're seeing in the market today, just kind of low double digit increase in spend per visit, is that -- if I look at the 62% base mass versus, let's call it, 48% overall visitation growth, is that reflective of market conditions, or is there some subtext or some difference that we should be thinking about, or did that change throughout the quarter at all? Just trying to kind of get a sense of what's pent-up demand and how much of this is just getting the bodies back into the property.

I think, one thing we would be careful of, we're -- again, we're in early innings here. In fact, we haven't -- I would say, if you're playing golf, we're still in the driving range. I mean, we haven't gotten the first tee yet. This market, 100 days ago, Grant reminded me, we're kidding about the market, hoping to see a profitable quarter in '22. We now just gave you a $400 million number. I think my point is, it's evolving so quickly and the movement -- if you look at -- I don't think it's easy to spot trends. I think clearly the base mass to Grant's comment, has been somewhat confusing and his thoughts recovered much better than base mass tables. But again, I think it's very difficult to assign the certainty to where the trends are going. I just think, when you look at the page -- Slide 16 or 14, you'll see the non-Guangdong visitation, which is pretty weak, and there is so much more room to run here. I think when this is all said and done, we'll make a lot more money with a very healthy margin and all this will be left behind the desk. I just don't think we can take -- what really effectively half of January, two months subsequent and assign real value to it. Yeah, it's just too early to figure it out. Grant, please jump in.

No, not a lot more to that, Rob. Yeah, I think you covered it well.

Shaun, what else you got?

Great. I mean, the other question would be the follow-up and maybe a little bit indulgent, but I'll try. Just trying to get a sense of kind of...

Indulge us.

Just trying to get a sense of market share as we, let's call, exited the quarter, be it March or some [amount] (ph) of run rate, as we look at it, some of the checks suggested that it was accelerating and you did very well. It probably depended a little bit of the timing on some of that base mass recovery, but for the quarter, we calculated you at around 27% share. And just kind of curious if that was level across the quarter? Did you kind of -- was it your exit rate meaningfully higher than that? I'm just kind of trying to, again, probably extract a little too much from where we are in the recovery, but we want try anyways.

All right. Patrick is going to take a look at that.

Yeah, it's an interesting question. I think when we look at Macao, it's a story of investment. So, if you think about the growth in Macao and the asset base that we have and why we're able to get the visitation and the productivity out of the assets, it's because of our scale of investment in non-gaming. It's the rooms, it's the retail, it's the entertainment, it's the food and beverage, it's all the things that drive tourism value. And so, we invested $2.2 billion across the pandemic. So, from our standpoint, it's a new day. And we have probably one of the most important assets we have created in The Londoner, which was Sands Cotai Central. There's a lot of productivity that's available there. We have 650 new suite that we didn't have pre-pandemic. There's a lot of volume that we're going to be getting that we never had access to, now that the pandemic recovery is underway. And I think the other thing that's important to note is we've done this two other times. So, we were in the Las Vegas market during the recovery. And we saw the schedule and let's call it the slope of recovery related to pent-up demand in the marketplace and recovery of tourism. We went through that. We saw it in Singapore and the different stages of tourism access that occurred in a very controlled market in that recovery. And now we're seeing unfettered access to what is probably the best cluster tourism assets in all of Macao globally. And they've been continued to be invested in. There's a lot of depth to the market. And it is the beginning innings. It's early. So to call a market share now is a little tough, because it's not really comparable to pre-pandemic, because of the amount of investment and some of the dynamics changes that have happened to the market in the last three years. So, from our standpoint, I think we put up a good quarter. I think we're positioned well. As Grant mentioned, we're very excited about the additional inventory coming online as we get manpower into the buildings. And I think we're in a good place to continue to grow. So, we're not really looking at market share right now as much as we're looking at investment, visitation, access, customer service and then margin and outcome. And you saw the results of that in the quarter that we just had. So, March was really good. We're really excited about it. We're in a great trend. And we're going to keep pushing.

Congratulations. Thanks very much.

Thank you.

Thank you. The next question is coming from David Katz from Jefferies. David, your line is live.

Hi, afternoon. Thanks for taking my questions. I wanted to just go back to the direct VIP business in both markets. And I know you made some commentary about sort of where Singapore is coming from and where some of the extra business is coming from. But can you help us understand the direct VIP opportunity in Macao? And are there any insights that we can learn from about where that could evolve to over time relative to what we saw in the past, understanding it's a completely different business today?

Yeah, I think we're all in the same boat here as far as not really knowing how -- I think the first quarter is indicative that there is a VIP market. Our rolling volumes indicate that. We wonder if it can increase, keep going. One surprise to me has been the acceptance of foreign visitation from non-China countries into Macao. It makes sense to me. The quality of product there, the diversity of product, the experience, there is very -- it's an exciting place to visit, easy to access, getting easier, especially for foreigners. So, I think that's going to continue to build. Also the people there -- it's obvious because the structural junk is disappearing. It's a much different approach. And these are people you have to know who they are, credit wise, et cetera, to be in business with them. But I don't think it slows down. My sense is, Macao has such a compelling product and such diversity of compelling products and has such great food and retail, it's just an exceptional place for visitor internationally. And I think you'll see more and more of that trend. I don't think it will cost as business in Singapore in terms of -- I think people will still obviously get to Singapore for the same reasons. But Macao, I think has a better future on the direct rolling business that I anticipated. And I think it's driven by, again, access, quality of product and people want to go there, and it's evident here in the first quarter. Obviously, the -- it's impacted by our retail sales as well. You can see the quality of our retail business in Macao, it's a direct relationship with the super high-end that come to visit. That's again, early innings, non-junket, liquidity issues, a lot of unknowns at this point. I don't think we should pretend to know what the future looks like, but I think there is a very positive trend in the right direction. Grant, do you want to comment?

Sure. Yeah. I think Rob is absolutely right. The attraction of Macao to foreign VIP gamer is immense and I think the pleasant surprise, although we are obviously redoubling our assets post the concession tender in bringing international visitation to Macao and the VIP gaming was the first natural place to start, given that the general airlift, commercial air flights are still a fraction of where they were in 2019. So, I think this direct VIP performance that you referenced, it was very healthy during the quarter and kept growing and we don't know where it grows to, but there's no reason to believe that it wouldn't continue to grow, given the quality of the product. And you can see, not just the strong product appeal for the premium customer that we provide, but we provide such a diversity of -- such a clustering effect of so many world-class resorts and we already have four of them in our portfolio. But together with all of the other colleagues in the industry, it's an amazing clustering of world-class premium gaming destination that should appeal to the Asian regional players over time. And then, I think the other point that is, I think specifically for us, we've been doing this for a long, long time in terms of our international direct VIP around the Asia region. Las Vegas, Macao, Singapore, this is not a new structure to us. We've just got enormous ability to promote Macao now to the foreign countries, because we have the capacity, and to Patrick's point, we have the new product that we've never had before, the availability of the top-quality suites, the top-quality salons. So, we're going to be -- we have been and we're going to continue to use our international sales network that we have the biggest infrastructure across Asia in the industry and that's where we're going to combine the benefit of this premium product, Macao as a destination for these Asian gamers. With our sales infrastructure that will continue to expand. So, I think the future is very bright for foreign visitation and foreign VIP market into Macao.

If I can just -- thank you for that. And if I can just follow-up quickly. In terms of which -- any color on sort of which countries and where this is sort of coming from and any sensibility about kind of the sustainability? Obviously, you feel like you can continue to grow them, but the non-Chinese, other countries, and the degree to which extending credit may cost a little bit more along the way. Any color there would be helpful too.

We won't be, David, country-specific, we won't do that. But I would just say to you, the demand is in a number of countries. And I think Grant's last point was very interesting. I was juffling, because he's actually right. We've been doing this for decades. In Asia, we have a very strong sales force. A lot of same people have been with us for 20 years and represents in Las Vegas and of course Singapore, Macao. So, we are the beneficiaries of that sales system. But I think the high-end is probably built now in Singapore and Macao is going to drive that customer. Is this sustainable? Does it grow? I don't want to predict the future. I just don't know. But if it does, I think we will be the biggest beneficiary of it, because again, we have the biggest network and we have all these different places that we can take people within Macao, and of course to Singapore. So, it's hard to predict because again, it's early innings here. But I think if there's a strong rolling business in Macao, I think we'll get a big chunk of that. And time will tell how big it is, liquidity issues. But the MICE and the junket business clearly has a new day there. But if we can roll $20 billion, $30 billion, it would feel like a good place to be, if that's possible.

Thank you very much. Londoner looks great.

Oh, thank you. You saw it? We love people seeing it, because it's only halfway there, but what we've built so far is, we're just very proud of it. Thank you.

You're welcome.

Thank you. The next question is coming from Brandt Montour from Barclays. Brandt, your line is live.

Hey, everybody. Thanks for taking my questions.

Hey, Brandt.

So, given -- thanks. So, given Grant laid out a pretty good case based on the transportation impediments and the hotel room inventory impediments, that premium mass visitation could very well outgrow base mass visitation from here. I hope I'm not putting words in anybody's mouth. But could you give us some insight into what you're seeing in terms of premium mass win per visitor and compare that to other markets that you saw reopening post-COVID and sort of an index to 2019? Just trying to get a sense for how the pent-up demand on a per person basis is really trending.

I'll just make a few comments and I'll pass on to Grant. I think the key thing here is having seen this, as we said before, in several other markets. This is an impressive recovery. It's very strong. The people who can get there are consuming meaningfully in all segments, retail, food and beverage, on the gaming side, on the hospitality side. So, it's great to see. It's very exciting. I don't know that in any of our markets, we had a quarter with this amount of EBITDA recovery this quickly after opening. So that's a good indicator. And so, I think we're very excited about that. I think, it's hard to call these things are -- it's -- I wish we had a crystal ball, but I think at this point, we look at the recovery and it's very encouraging. I will turn it over to Grant to see if he has an additional remark.

Yeah. I would say, the points that we're making on the hotel room inventory and transportation, it's more a reflection of what happened in the first quarter. I think, if anything, those factors obviously improve and has been improving dramatically into March and into second quarter. So, we obviously hope that the base mass would catch up assuming as we are the biggest beneficiary of that segment. And then, I think spend per head for the entire market is clearly up and the quality of customer is very high. And I think it really applies to all segments. You only have to walk through the different properties. You can see the level of spending power, not least in our retail, more -- we're up 18% in overall retail sales versus 2019, but clearly the luxury segment, it's up a lot more. And that's with obviously only [40%-something] (ph) of visitations that we had in 2019. So, not just in gaming, but also in the non-gaming and retail, you can see those trends were consistent in the first quarter. But hopefully, we can start to see the base mass visitation growing and the hotel room occupancy growing for the entire market.

Great, thanks for that. And switching gears maybe to New York. Just curious if you're willing to give any updated thoughts on the RFP process there? If you think the timeline has shifted since we've talked about it three months ago? Any other comments on the factors for winning that third license? Thank you.

Yeah. New York, work in progress, waiting response from the government. Obviously, it has pushed back. We're here and we don't know for a fact, let's begin there. But we've been told, it could be early first quarter of 2024. But again we have no definitive date at this time. We do believe we have a very compelling bid. The project is in sync with our historical approach to development. It's large scale resort with enormous non-gaming amenities, hotel, convention space, entertainment, spa, et cetera, very beautiful design, very much LVS spirit, the way hotel should be designed as a real resort, a real destination. We have close to 80 acres. So, I think we have a very special bid, a very compelling bid, and I hope the market sees it that way. Timing will reign with New York State's government, and again we hope it's the first part of '24. No more to say about that at this time.

Thanks, Grant.

Great, thanks, again.

Thank you. The next question is coming from Steve Wieczynski from Stifel. Steve, your line is live.

Hey, guys, good afternoon. So, Rob or whoever wants to take this. I mean, if we look at visitation into Macao over the last, let's call a month or so, it seems like there might have been or there might has been a change in the makeup of the typical visitor coming into the market. And based on some reports that have been out there in the market, it seems like there are potentially more tour groups and stuff like that coming into the market versus pre-pandemic. So just -- I'm just trying to -- just wondering how you're thinking about the spending characteristics or wallet size of the typical customer today versus what that typical customer looked like previously. I'm not sure I asked that question really the right way. So, if I didn't, let me know.

I think you asked it perfectly. It's a good question. Grant, do you want tackle that first?

Sure. Yeah. I mean, I think we're trying to get recovery in all segments of the market, as the tourism market is multifaceted in terms of the different segments. And the tour groups with the last segment to really be recovering. So that's only been taking place in the second half of the first quarter. So yes, the first visitors to come back been more at the premium end and over time, you're going to get all the other segments recovering in good time. And I don't think there's any difference fundamentally in terms of how these different segments behave or perform versus 2019. I think in general, of the people who have been coming back, I think you've seen a higher propensity to spend. But over time, as the other segments come back, I don't think we should necessarily expect a fundamentally different mix or fundamentally different profile within each of those segments. Yeah, so the only different point to make at this juncture is that, yes, across all segments, the spend -- spending power is higher than what it was and propensity spend is higher, and we'll see where that evolves over time.

Steve, I think we all agree that what Grant just said, we have total confidence that this market will look a lot like it did before. The only difference structurally is the junket situation. But maybe the more affluent have gotten better access earlier, but I'm a staunch believer that that market will come roaring back in the base mass. You walk around the Peninsula, you see already the base mass is booming down there, although it's just lower-quality spend than premium base mass. But I think the base mass market will come back, the question is how quickly it does come back. But this market will look fundamentally the same in 2023 and '24 as it did in '18 '19, I'm pretty confident of that.

Okay, thanks for that, guys. I appreciate that. And then, Rob, I think the slide - what number is it, number 23, it's pretty interesting in terms of how you laid out your Macao capital commitments for the next 10 years or so. I don't know if you answered this, but if you think about that potential all-in, the $4.5 billion that you might have to spend over the next 10 years, is there any way you could help us think about what you guys are kind of targeting for a potential return on that commitment?

Patrick?

Yeah, I think we've always said publicly that we look towards a 20% return on invested capital there. But I have to tell you, Macao is a bit of fantastic market to invest in over the last 20 years. We're very excited to follow through this commitment and we look forward to the opportunity to actually invest more. If you look at the growth of our company, it's because of the investments we've made in Macao in non-gaming. It's an extraordinary tourism market. The consumer responds very well, and we're very excited about the opportunity this new concession to invest more than what we have on this page. So, it's something that we're very focused on and we look forward to the opportunity to do it.

I think we're going to be raging bulls on Macao, investing in the future. And they're fairly look-back to our past and further, you can see our future, which is going to be, we believe non-gaming assets are wildly profitable, but they also drive gaming assets. It's all in sync. So we build more hotels or we build more retail or anything, it drives the gaming win. We've got plenty of positions to fill and to grow those numbers. When you look at the slot number coming to Singapore and the win per unit and tables, you realize just how far Macao can get to. So, we never saw the investment in the concession being an ending point. We saw it the beginning point. We much believe that Macao in next 10 years will make a lot of money for us. We're very bullish on the market and we're thrilled to be there.

Okay, great. Thanks, guys. I appreciate it.

Sure.

Thanks, Steve.

Thank you. And the last question today is coming from Dan Politzer from Wells Fargo. Dan, your line is live.

Hey, good afternoon, everyone, and congrats on the quarter.

Thank you, Dan.

First, I wanted to touch on Macao. Can you talk a little bit about the recovery level across the properties there, and which have been most impacted by room and labor constraints versus mass versus premium mass mix? And then, similarly with Londoner and the suite investments that you've made, what's kind of been the kind of the early read out of the gate and your expectation on recouping that typical 20% return on those investments in terms of timing? Thanks.

Grant, are you still awake? Grant, please take that.

Yeah, sure. I think between the properties, Londoner clearly is the most impacted by the hotel room availability. So, you can see that the reported, like physical inventory, occupancy is only 46%, 47% for the property as a whole. And that's the biggest repository of hotel rooms in our portfolio. So, clearly the impact for that property was the greatest. But at the same time, it kind of flips into your -- second part of your question. The portion that we were operating, especially the newer product on the north side of the building and the new suites, we've really had an exceptional customer response to the product. I think not just the excellence of the design and hardware, but also combined with the actual programing of the hospitality, and just the levels of service that bespoke hospitality that we're offering, but doing so at scale. So in terms of those return questions that you asked, we see the early signs are very, very positive from the new product, including the new suites at Londoner hotel, and also the brand new Londoner Court, which is offering very different kinds of bespoke luxury hotel experiences for the customer. But overall for the property, it's a big property. We are hampered by the lack of hotel room availability during the quarter for sure, but, of the new product that we're actually operating, the initial results are, I think, very-very pleasing.

Got it, thanks. And then just turning to Singapore. Maybe if you could talk a little bit about the puts and takes the reopening of China? And I know inbound travel from China has been a little bit slower to recover, but, I guess how do you think about that recovering over the course of the year? And then, similarly, China customer base that had been in Singapore, are you still seeing that customer, or have those -- has that base gone back to China?

Patrick?

Thanks. It's a very interesting question. I think with the opening of China on January 8, there hasn't been a huge influx of Chinese visitation in the early part of the quarter. But there is an ongoing ramp of outbound tourism from China, that we will be the beneficiaries from. And that's something that we've been anticipating a long time. There is not the normal level of flights. There is not the, let's call, the normal airlift capacity that you would expect during a normal run rate period, which they're going to slowly ramp into. So across the year, our expectation is that, that visitation will recover. It's such a strong market for Singapore, has been historically, and yet we're able to execute these levels without that market really contributing. So we're very bullish on the opportunity of outbound tourism from China to support Marina Bay Sands and its ultimate growth to where Rob has mentioned earlier in the call and beyond. There is one other comment that I do want to make. We had a very interesting question from Steve just prior to yours about the level of investment that we're willing to make in Macao. And I think we're very optimistic about our investments there. It's a high return environment. We're very focused on continued investment there, not only through the fulfillment of our concession renewal, but also in general, to grow our non-gaming asset base. But the same thing was true in Singapore. I think we're very focused on growing Singapore as a market. The opportunity there is very unique. It's a really high-value tourism market that has a different catchment area than Macao. We're very excited about the Marina Bay Sands expansion. Although, just to sort of comment on it, kind of going down that vein, we have very high expectations for return on invested capital in both these markets. But when we first went into the Marina Bay Sands expansion in 2019 and we entered into a development agreement in April of 2019, a lot of things have changed. So it's probably going to be a lot more expensive. The pandemic brought additional costs. There has been material -- labor and material cost increases. There has been significant inflation globally, as everyone knows. It's just overall market conditions. But I think from what you see in this quarter, is that the strength in the market is on full display. We really believe that it's going to get stronger over-time. And particularly with investment in high-quality tourism assets, which is what the Marina Bay Sands expansion is. But I think it's really important to note that there's been significant inflation since we began discussions a year ago. So the cost at Marina Bay Sands expansion is going be a lot higher. The good news is, the market is so good. We think the opportunity is going to be a lot stronger or will do a lot better. So, I think to set expectations, the investments that we make, both in Macao, are going to be very strong return. We're very excited about them over the next concession periods. We're really looking forward to investing in Marina Bay Sands expansion. We think it's going to be a great asset. But both of these are going to be expensive. The good news is that we believe the returns are there or we wouldn't be doing them. So, I don't think our investment thesis has changed in either market with the cost inflation. We believe in our long-term success in these markets. We sort of have a very long-term thesis in both of them and going to deploy capital into both in scale. And we're going to look for high returns, and we feel very strongly about the opportunity in both of these markets. But I did want to say that it's going to be expensive and it's going to be worth it.

We are fortunate to be in two markets: one, our expense, the two, reward the money spend. I think we're very fortunate to be in a market that can grow and grow, and we will continue to invest heavily because we believe we'll get back to much bigger numbers in both markets. So stay tuned. We appreciate your time today. Thank you very much.

Got it. Thanks so much.

Thank you. Ladies and gentlemen, this does conclude today's conference call. You may disconnect your lines at this time and have a wonderful day. Thank you for your participation.