International credit ratings firm Moody’s Investors Service Incorporated has reportedly announced that it is currently considering whether to lower its financial assessment for American casino giant Las Vegas Sands Corporation.
According to a report from GGRAsia, the organization revealed that the review, which is also looking at the Las Vegas-based gambling firm’s Sands China Limited subsidiary, was initiated following a recent downturn in business caused by the coronavirus outbreak.
Moody’s Investors Service Incorporated reportedly used a Monday filing to declare that the evaluation could see Las Vegas Sands Corporation lose its ‘Baa3’ senior unsecured credit rating as its bonds are ‘subject to moderate credit risk’ and may also ‘possess speculative characteristics’. It purportedly detailed that the investigation could moreover lead to the ‘Baa2’ grade for Sands China Limited being downgraded after that firm was forced to shutter its five properties in Macau for a 15-day period last month as part of a campaign to stop the spread of the highly-contagious coronavirus strain.
GGRAsia reported that Las Vegas Sands Corporation is responsible for southern Nevada’s The Palazzo and The Venetian Las Vegas properties and last year pledged to spend upwards of $3 billion so as to expand its Marina Bay Sands venue in Singapore. Its Macau-headquartered Sands China Limited subordinate, which runs The Venetian Macao, The Plaza Macao, Sands Macao and The Parisian Macao properties, subsequently explained that it would be parting with approximately $1.3 billion in order to rebrand its Sands Cotai Central development as The Londoner Macao.
However, the subsequently outbreak of the potentially-deadly coronavirus ailment, which is officially known as 2019 novel coronavirus (2019-nCoV), is reportedly said to have negatively impacted both firm’s business. Macau saw its aggregated gross gaming revenues for February plummet by over 87% year-on-year to only $387.2 million while several brokerages have since purportedly predicted that this comparable slump could well be repeated for March.
Adam McLaren from Moody’s Investors Service Incorporated reportedly used the filing to state that both casino firms have recently been experiencing a dramatic dip in gross gaming revenues caused by a number of coronavirus-related factors including enhanced quarantine rules and health declarations alongside Macau’s new reticence concerning Chinese arrivals.
Reportedly read a statement from McLaren…
“The review for downgrade is prompted by steep declines in visitation and gaming revenues at Las Vegas Sands Corporation’s Macau and Singapore operations as a result of the spread of the coronavirus, [which has] restricted travel in the region, as well as the expected reduced travel, consumer and business activities in the United States.”
It was further reported that the credit ratings agency’s announcement came prior to Nevada Governor Steve Sisolak’s Tuesday decision to temporarily shutter every one of his state’s casinos for 30 days although it did warn that coronavirus fears are likely to particularly hit business on the Las Vegas Strip ‘because business travel, conferences and independent leisure travel will decline.’
Reportedly read the filing from Moody’s Investors Service Incorporated…
“Coronavirus is already having a negative effect on Las Vegas Sands Corporation’s Macau casinos because containment efforts reduced visitation including closing for 15 days in the month of February.”