Macau casino operator Sands China Ltd announced on Friday its first dividend in five years. The Hong Kong-listed company declared a final dividend of HKD0.25 (US$0.032) per share for the year ending December 31, 2024.
The dividend will be paid on June 20 to shareholders on record as of May 30.
The dividend had already been expected by investment banks.
“We’d treat this HKD0.25 per share as a half-yearly dividend for calendar year 2025, which we think will be repeated in the second half of 2025 to make full-year dividend per share of HKD0.50,” wrote brokerage JP Morgan Securities (Asia Pacific) Ltd in a Friday note following Sands China’s announcement.
“This would imply a 2.9-percent yield, which is not nothing but not needle-moving either – compared to the 5.2-percent yield for MGM [China Holdings Ltd] or even 3.6 percent for Galaxy [Entertainment Group Ltd],” wrote analysts DS Kim, Selina Li and Mufan Shi.
They called the dividend “modest”.
The JP Morgan team suggested that Sands China “may plan to pay back” an existing US$1-billion shareholder loan later this year, “which probably limited its ability to pay dividends for now”.
The analysts added: “If we’re right about this, Sands [China] should be able to ramp up the size of its dividend sharply from 2026 onward, up to about HKD1.5 per share per annum if they want.”
According to a previous memo from JP Morgan, prior to Covid-19, Sands China “consistently paid out a dividend per share of HKD1.99 each year from 2014”.
Sands China runs a number of casino properties in Macau, including The Venetian Macao, The Parisian Macao (pictured), The Londoner Macao, and Sands Macao.
In May 2023, Sands China agreed to an 18-month extension of a dividend-restriction period as part of an amended and restated facility agreement worth approximately US$2.49 billion. The period during which Sands China committed to such dividend restriction was extended at the time up to and including January 1, 2025.
In July 2023, Sands China’s parent, U.S.-listed Las Vegas Sands Corp, announced it would resume its quarterly dividend programme at US$0.20 per common share. The firm stated in late January this year that its quarterly dividend would increase to US$0.25 per share for the 2025 calendar year.
Sands China had said in April 2020 that its board had decided not to recommend a final dividend for the year ended December 31, 2019. It said at the time that the decision was due to the “current and potential material impact of the Covid-19 coronavirus pandemic on the global economy”. The company had recommended a final dividend of HKD1.00 per share for 2018.
Fourth-quarter 2024 net revenues for Sands China decreased by 5.0 percent year-on-year to US$1.77 billion. The firm’s net income stood at US$237 million in the three months to December 31, compared to US$288 million a year ago.
Adjusted property earnings before interest, taxation, depreciation, and amortisation (EBITDA) from the Macau business were US$571 million in the final quarter of 2024, down from US$654 million a year earlier.
