Las Vegas Sands Q4 2021 Earnings Call Transcript

AlphaStreet
Provided by AlphaStreet
January 26, 2022
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Operator

Good day, and thank you for standing by, and welcome to the Las Vegas Sands Fourth Quarter 2021 Earnings Conference Call. [Operator Instructions].

I would now like to hand the conference over to your speaker for today, Mr. Daniel Briggs. Thank you, sir. Please go ahead.

Daniel Briggs
Senior Vice President, Investor Relations at Las Vegas Sands

Thank you. Joining me on the call today are Rob Goldstein, our Chairman and Chief Executive Officer; and Patrick Dumont, our President and Chief Operating Officer. Also joining us on the call are Grant Chum, our Chief Operating Officer of Sands China; and Dr. Wilfred Wong, who is about to get connected. And apologize for starting late.

Before I turn the call over to Rob, please let me remind you that today's conference call will contain forward-looking statements that we're making under the Safe Harbor provision of federal securities laws. The company's actual results could differ materially from the anticipated results in those forward-looking statements.

In addition, we may discuss non-GAAP measures. A definition and a reconciliation of each of these measures to the most comparable GAAP financial measures is included in the press release. Please note that we have posted supplementary earnings slides on our Investor Relations website. We may refer to those slides during the Q&A portion of the call.

And finally, for those who would like to participate in the question-and-answer session, we ask that you please respect our request to limit yourself to one question and one follow-up, so we might allow everyone with interest the opportunity to participate. Please note that this presentation is being recorded.

With that, let me please turn the call over to Rob.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Thank you, Dan, and good afternoon and good morning to our colleagues in Asia, a very good morning to our colleagues in Asia. Thank you for joining our call today. We will have some brief comments and then we'll go right to Q&A. Our results continue to reflect the pandemic's impact, travel restrictions continued to affect visitation, and our financial results in both Macao and Singapore this quarter. We did generate some positive EBITDA for the quarter in both markets. We remain confident in the eventual recovery in both Macao and Singapore.

The good news in Singapore, the travel restrictions and travel corridors were established with many important source markets during the quarter, Indonesia, Malaysia, South Korea, Australia, Thailand, were all part of the initial rollout of the retail program. And obviously, the emergence of Omicron variant impacted the retail program. In late December, the retails should contribute to a more robust recovery over time. Our confidence in the long-term opportunity in Singapore remains deep. And I'm pleased to announce we've embarked on $1 billion US renovation project at MBS that will introduce luxurious new suite product to the Resort. The program will meaningfully expand our room suite offerings, and significantly enhance our appeal to the premium customers.

In Macao, The Londoner is near completion. As the market recovers, both the Four Seasons and Londoner will provide growth opportunities -- material growth opportunities in both the premium and mass customer segments. We continue to have the largest footprint in the world's greatest market for Macao, and appreciate the opportunity to provide input in the public consultation process ongoing. We look forward to participating in tendering process as it proceeds to fruition. Customer demand and spending in Macao have proven resilient at the premium mass level from both the gaming and retail perspective, it's outlined I think on Pages 29 and 30 in your deck.

We continue our great optimism about our ability to perform to pre-pandemic levels once visitation returns. You may know, our company is divided primarily the three material areas, the most important being Asia, the portfolio in Macao and Singapore. We remain confident, we will return to strong positive cash flow in both Macao and Singapore in the future as restrictions are eased and travel and tourism recover. The sale of Las Vegas creates liquidity and optionality as we pursue additional large-scale land-based destination resorts in the US and Asia. And we continue to build our digital presence, we're exploring multiple opportunities this time, we will provide some color at the appropriate time.

So let's go to your questions and thank you for listening.

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Operator

[Operator Instructions] Our first question comes from the line of Joe Greff with J.P. Morgan.

Joe Greff
Analyst at J.P. Morgan

Good afternoon and good morning everyone.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Hi, Joe.

Joe Greff
Analyst at J.P. Morgan

Rob and Patrick, like to start off on within a topic of capital return and how you're thinking about that, particularly in light of $5 billion in gross cash proceeds coming in, in a couple of months. Does that cause you to rethink that capital return is more of a near-term event? Or do you really need to see a recovery in both Macao and Singapore before you initiate some sort of capital return, I know you mentioned liquidity optionality for new jurisdictions in the US and Asia. So, in that part of the calculus, but if you can refresh your thinking on capital return, I think, that'd be helpful for us.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Patrick?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

I'm happy to. Yes. Hey, Joe. I appreciate the question. I think we've been pretty consistent in our thinking. It's been part of our long-term strategic plan how to create additional capacity to really grow this business. The Sheldon [Phonetic] has really started from the beginning as you know you followed us since day one. That he's really been a developer of large-scale projects. And I think that ethos continues today within our company and I think we're very excited about some of the opportunities that we have in front of us. Rob and the rest of the development team and our entire group has been working very hard. It's great opportunities to grow with large couple development in the future.

So, I think the way we see the capital that's going to come into our system from the consummation of Vegas sale is really to grow the business. As we've always said before, the dividend and share repurchase is really about to represent part of our shareholder return strategy, the dividend being the cornerstone. We're looking forward to the opportunity of restarting dividend program. But as we've said, and I think we've been consistent about the idea that we really want to see a steady return to operational cash flow, understanding what those cash flow levels are from a trajectory, and I'll call it a sensitivity scenario perspective. And then make an assessment about the proper return of capital at that time.

We really view the dividend is something that needs to return on a stable and long-term basis. And so that's something that we'll look to do when our cash flows return and we get out of pandemic operations, which unfortunately for this quarter, we were still in.

Joe Greff
Analyst at J.P. Morgan

Great, that's helpful. And then maybe the gentleman from Macao can chime in on my follow-up question. Just a clarification on the draft bill on the amendments to the gaming law. Can you talk about how the government is thinking about you and others in the market maintaining specific levels of gross gaming revenues in order to maintain your table count? Can you talk about how they're broadly or specifically thinking how this will work on with the broad framework this year? And that's it from me. Thanks.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Grant, you there?

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

Yes, sure. Thank you for the question. I think the amendment to the gaming law is still in work in progress. It's working its way through the legislature. We need to wait further details in terms of the final form that the amendments would take. And there'll be additional regulatory measures that will be potentially issued thereafter. So in general, so to your question, we've always efficiently used our table allocation. And in general, we welcome the direction of linking table allocation with productivity but the specifics, I think are yet to be outlined.

Joe Greff
Analyst at J.P. Morgan

Thank you.

Operator

Your next question comes from the line of Carlo Santarelli with Deutsche Bank.

Carlo Santarelli
Analyst at Deutsche Bank Aktiengesellschaft

Hey, guys. Thank you. Rob, maybe if you could kind of shine some light. I know, Singapore, obviously it was kind of a tale of a couple of months. But as you see things starting to normalize over the course of the period, could you comment a little bit about how you felt during the better periods of the quarter as it pertain to restrictions and stuff like that one, some of them are more rules.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Yes. We were very excited to see when there is rays of light and you can get in and the details established, it was extraordinary. And I think it indicates, it's a real predictor, Carlo, it's going to happen, that place opens back up. Hopefully, we see it in the first half of the year. Clearly, demand is going to be there. The retail of the government's thinking is very positive for us. I think Singapore probably gets there quicker than I think Macao maybe later but starting with Singapore, the demand is clearly evident when the retails were opened, it's a shame, I think we had a real -- a positive momentum going in, they're crushed by the Omicron concerns.

But I think that's just inevitable. The markets around this, I mean the important source markets are opening up. Japan, Korea, Indonesia, Malaysia, all improving. So we have a lot of hope to see a big bounce in Singapore. I would like to reference, we had some non-recurring income in that quarter, you should be aware of.

Patrick, can you illuminate just we're clear on the numbers on the Singapore portion.

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Yes, sure. Happy to do it. So -- yes, of course, happy to do it. And Carlo, thanks for the question. One thing we did want to highlight is that we were positively impacted by approximately $70 million of non-recurring items during this quarter, including bonus reversals, Job Support Scheme, and some other items. So I wouldn't look at this is a run rate quarter. I think I would point you back to some of the comments that Rob made on some of our prior calls about that run rate envelope during these conditions, call it the $500 million run rate EBITDA context. The real problem is things have kind of been switched on and switched off so much. It's hard to get a real read on the quarter.

I think what is really encouraging is the vaccine travel lanes. The public health posture of the government, which really has been a leader in both vaccinations, and the way they approach public health. And we're very encouraged about their approach towards long-term tourism and we're very excited to see how that plays out in the upcoming quarters. But I think overall the vaccine travel lanes were a big step.

Carlo Santarelli
Analyst at Deutsche Bank Aktiengesellschaft

Great, Patrick. Thank you. That's helpful. And just one point of clarity, that $70 million, what was that? Was that all in the EBITDA results for the quarter?

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

It was. It was. That's why I referred back to the run rate that we talked about previously.

Carlo Santarelli
Analyst at Deutsche Bank Aktiengesellschaft

Yes. Thank you. Thank you, Bob.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

We've referenced $0.5 billion run rate until things get better over there, until these travelings become real. We are still in the same range as our point not to get overexuberant about the $170 million, it is impacted by non-recurring. Okay.

Carlo Santarelli
Analyst at Deutsche Bank Aktiengesellschaft

Thank you, guys.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Thank you.

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Thank you.

Operator

Our next question comes from the line of Robin Farley with UBS.

Robin Farley
Analyst at UBS Group

Great. Thanks for taking the question. I was wondering if you could talk about, you've said for a while you're evaluating online gaming and sports betting options. And there's still a little bit of a change in valuation over the last year. Can you talk a little bit about how kind of what your current thoughts are and how that may be impacted by changing valuations?

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Yes. I think we've said in the past, we've always been interested in digital and all these interest that's happening in the market. But two things are happening in the same time. Our business I think is going back to a stronger place in '22 finally, especially in Singapore. And I think as well Macao we'll see that getting better. Our balance sheet speaks for itself and we've all followed what's happening in the digital equities, and the struggle there. So I believe there will be a day when sports betting and iGaming are very successful businesses. And we'll continue to look at the opportunity. We'll wait patiently. Hasn't been a bad idea to wait for six to eight months to see how this shakes out. And it's been a lot of blood spilled.

But I think we'll continue to evaluate is there an entry point that makes sense for LVS. We remain consistent, Robin, as you know, you know for years, our bread and butter is still going to be Asia land-based as we will make -- you can't replicate a $5 billion business, which we think will come back in place next year or so. So that's our first order business and making sure our balance sheet is pristine, which now will be the following closing. But we'll continue to monitor as the new difficulties continue, the equity markets and the valuations change. The question is, when does that situation get better? And I think it will, and is an entry point for us and we'll keep our eyes and ears open for that possibility, but waiting hasn't been the worst idea to see how things shake out.

Robin Farley
Analyst at UBS Group

That definitely not. Also a follow-up question is, can you remind us what your kind of latest thinking is on the size of the investment, when you go to rebid for the new license term? At times you've talked about things in the past, obviously, you're looking forward to investing more in Macao. Can you kind of remind us what your latest thoughts are on the size of that? Thanks.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

I'm not sure, investing, and Patrick I may be missing. I don't think we have a -- I mean we continue to be very bullish on the Macao market despite the last 24 difficult months. We like we're seeing the re-tendering process or respect for the process, we're continuing to help and being involved with the government. I don't think we have a dollar amount in mind or a specific approach at this time.

Patrick or Grant, do you want to chime in?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Yes. I'll just say one comment, and I'll turn over to Grant. But I think the important thing to note, it's still very early stages. Yes. So I don't think there's any details that we can really talk about in terms of our approach because it's not known sort of where things are going to shake out.

Grant, I don't know if you have any other comments you want to add?

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

No, I think that's right. I think we just reiterate our general approach which is continued reinvestment in our asset base. And it's worth reminding ourselves. We're coming to the end of our $2.3 billion capex program in Grand Suites at Four Seasons and The Londoner Macao. And we've really stayed the course during the pandemic, we've accelerated the works where we can. We've overcome all the challenges related to supply chain during this pandemic, and we're coming well within budget, and we're delighted with the outcome. So I think that gives you a pretty good indicator, both of our appetite, but also of our resolve to continue to reinvest in particular in the direction that the government is pointing towards across the various domains of diversification.

Robin Farley
Analyst at UBS Group

Okay, great. Thank you very much.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Thanks, Robin.

Operator

Your next question comes from the line of Stephen Grambling with Goldman Sachs.

Stephen Grambling
Analyst at The Goldman Sachs Group

Hi, thanks. I guess two follow-ups. And the first is really a follow-up on Robin's question, and Joe's earlier question is from of legislative proposal. You mentioned, it is still a work in progress obviously, but I'm wondering if you could just walk us through where you feel like you do have incremental clarity and where specifically there may still be pockets of uncertainty based on the language in your conversations.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Grant, that's yours.

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

Thank you for the question. I think the main -- the key aspects of the legislation, have been laid out in terms of the number of concessioners and the duration of the future concession. There are a lot of details in there I can say to be worked out through the legislature. We just translate along through the first meeting with the legislative assembly. And we are now moving to the release stage.

So I think as a point to that on, it is still in draft form, but we really welcome the progress that's been made so patiently and so rapidly since the launch of first public observation in September, it's only been a shortfall month since that time and we already at this stage, where we're going into the committee review of the draft. So I think the government has done an outstanding job in getting us to this stage of the process. So quickly with a lot of our framework being clarified. But it is important to remember that this is still draft legislation. And we are able to find out the final outcome hopefully in the coming months.

Stephen Grambling
Analyst at The Goldman Sachs Group

Fair enough. Maybe as an unrelated follow-up here. You continue to have impressive cost control, despite a pretty difficult environment. How are you thinking about margins and labor inflation in Macao as well as Singapore as we think about ultimate recovery versus maybe some of the cost reductions you've made?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

So. Hey, it's Patrick. It's something that we look at a lot with our team. And I think one of the focuses that we had during this pandemic of these last really two years has been to keep the core team together. So when we do recover, we have the ability to service our customers and get right back to business. And I think it's to credit to Grant's to the team in Singapore, and really to everyone at the local teams that we're able to keep the Group together, continue to focus, continue to working, and keep everyone healthy and safe.

And I think where we are today, as we look about -- look at margins upon the recovery, we were in a pretty efficient business both at Sands China and in Singapore prior to the pandemic. If you look at our margins in the years leading up to the pandemic, Sands China team did an unbelievable job taking a lot of cost out of the business and becoming more efficient as we grew our business there. And so I think if you look over a series of years, we've always been cost-focused. I don't want to say that there was really room in the prior operating level. What is true is that I'd like to believe that the run rate margins for the business will be consistent with those margins prior to the pandemic.

The one thing to note is that in Singapore, there is going to be a tax rate change which will impact a gaming tax rate change, which will impact margins, at Marina Bay Sands, when that happens. There will be some slight margin impact from that going forward. But as a practical matter, we would expect to have the same margins, given the same level of volumes, even taking into account mix. Because if you recall it in Macao, our exposure to lower margin business such as junket and VIP is less, we're more premium mass focused. So we'd like to believe our margin structure will be fairly consistent upon the recovery.

Stephen Grambling
Analyst at The Goldman Sachs Group

Helpful. Thanks so much.

Operator

Your next question comes from the line of Thomas Allen with Morgan Stanley.

Thomas Allen
Analyst at Morgan Stanley

Hey, thanks. Can you just talk about potential future investments? I know that you've been looking at Florida, New York, any comments on those markets? And then when announced the project in UAE yesterday, have you considered that market? Thank you.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

I'll take the US, and I'll leave Patrick to discuss the UAE. Tom, as you know, we've been for years talking about maybe before your time it's been so long. New York, we're big believers in that market. The recent announcement by Governor Hochul about three licenses is encouraging. We're in the hunt. I wouldn't want to overplay our hands, say we have a -- what our opportune might be, but it's a massive market underserved by the current product and by any metric that should be a massive market for us. So we're deep into it. We were there last week, we have a team on the ground working through it. And we're hoping to get a license. That's all I'll say about that.

You followed in the newspapers, our efforts in Florida, we're in a signature-gathering mode. It's a struggle down there, it's not an easy process to go through, but we're trying very much to be in the hunt in Florida. We really appreciate how underserved that market is and the material opportunities exist for a top-tier land-based opportunity in Florida would be wonderful. Same goes for Texas, Texas a few years away from, we have been down there. We have spent time in the market. We have people trying to find our place in that market if it does happen, but I think that's probably the farthest way from the decision.

Patrick, you want to address the win situation in UAE, what happened over there, yesterday?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Sure, happy to. So a couple of thoughts. So first off, as someone who is in the tourism business, our company is very focused on looking at markets evaluating them. And what's different markets present in terms of both competition and things that customers like. And I would tell you is, if you go to UAE, and you go to -- and you see the investments that are going on there, it's really remarkable. The scale of investment, the cause of investment is really unique to the world, it's a very special place. And I understand why we would have interest going there. It is a tremendous tourism market, has a lot of potentials. And to be fair, it is an economic center for that region.

So in terms of opportunity, we all understood why there would be interest there for them to go. So it's something that we'll continue to watch and look at, but there are a lot of high-quality markets are available to our company. Rob, just referenced a few. And we're going to keep all of our options open and continue looking for opportunities for Las Vegas Sands to deploy capital in high-quality developers. So that's really sort of our view on that situation.

Thomas Allen
Analyst at Morgan Stanley

All right, thank you, Pat. And then just on the MBS $1 billion renovation. At time, you guys have been talking about for a long time but you just side your slide deck this quarter, is that just because now it's ready? Any more details on the potential disruption or timeline? Thank you.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Yes -- that is moving forward, that will be the point we talked about a long time, Thomas, we have under-invested times. And the new rooms and suites or deepen their renovation. I think we all know with the COVID environment, you always have the risk of either labor supply chain risk but they're moving nicely and the team that we have not been there, so we had a chance of seeing it, but the images we see are very positive and I think it's moving in a really good pace assuming that there is not interruptions we can't control. Patrick?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

So I think what's interesting about it, you've heard, Rob referenced it before, and I think our team is very focused in using this time to the pandemic to enhance our product offerings and our attractiveness to our customers. And we've always been working with the Singapore tourism board to help achieve their goals while we invest. I think there has been a focus in Singapore the last few years on increasing high-quality tourism, and we believe MBS is a leader in that area and we want to reinvest in the property to really enhance our suite product in some of the other amenities that we have for our customers while we have some downtime.

And so this is something that we've been looking at for many years. We have a high-quality design team that will really create some of the best suites we've ever had in our system. We've had some great success with some of our efforts in Macao, in some renovations, and some of the new products we brought online during the pandemic. And so we feel like our design levels really at a high level now. And we're really looking forward to investing this amount of capital into Marina Bay Sands to create a level of suite product we never had it before both in terms of accounts and in terms of quality.

So this will address some of the goals have been laid out for the Singapore Tourism Board, and the government there as well as help us address and grow our business and high value. So that's really the objective that some of that will happen really, over the next two years. We're underway now, and we hope to be complete as soon as possible, but in reality to the labor and materials, it looks like it's going to take two years.

Thomas Allen
Analyst at Morgan Stanley

Helpful. Thank you.

Operator

Your next question comes from the line of Shaun Kelley with Bank of America.

Shaun Kelley
Analyst at Bank of America Merrill Lynch

Hi, good afternoon and good morning everyone, thanks for taking my question. Maybe just one because it actually hasn't come up. I guess it's a sign of the times really that -- I was just wondering from either Grant or Wilfred if we could get a little color just on the COVID conditions and signaling on the ground in terms of possible reopening milestones you might be looking for. I believe there was actually a little bit of press from the government talking about the tourism industry and its importance. So maybe just a couple of your high-level thoughts about, things we can look forward to there?

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

Sure. Thanks for the question, Shaun. I think in the last few months, if you could describe it sequentially, we've come through some local cases on COVID that occurred in Macao at the end of September to early October. So obviously, the business environment was heavily impacted during the month of October in fact that was the lowest month in the entire year for GGR [Phonetic] for the city.

As we move towards the end of the year, things improve in terms of the travel board and policies around Zhuhai and Macao. And then you saw the defense volumes and the patients pick up accordingly. Most recently we've had some local cases in Zhuhai which has impacted the border again. And hopefully, we're going to be coming through the other side of that, as they get that under control and as they have done.

So I would describe as not a lot has changed in terms of the overall environment. The government both central government and local government continue to control the COVID cases exceptionally well in accordance with the policies. And as we move forward, we obviously have the Chinese New Year and also the winter Olympics and understandably everyone is being cautious in terms of traveling. And obviously, it's possible that beyond these events, as things improve in terms of domestic cases in the west province and these big events are out of the way. We can look forward to more positive picture in terms of travel.

Shaun Kelley
Analyst at Bank of America Merrill Lynch

Great, thank you. And then just one probably for Patrick. But Patrick, you mentioned the Singapore tax rate, I think we picked that up, in some of the local press as well, just was curious if you could give us a little bit more color on how that plays through? Is this the change that was actually tied back to the license extension? Or is this something that's incremental or different from that because I think there was a tie-in to that if I recall correctly, but it's frankly it's been a couple of years?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Yes, it's just been a couple of years. This is the implementation of what we're trying to develop an agreement. So nothing has changed, consistent with prior disclosure, prior discussions, but just wanted to highlight it as some of that may have an impact on margins going forward. That's all.

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

Great. Thank you very much.

Operator

Your next question comes from the line of Dan Politzer with Wells Fargo.

Dan Politzer
Analyst at Wells Fargo & Company

Hey, good afternoon, everyone. Thanks for taking my questions. So, a quick follow-up on just the sports betting and iGaming endeavors are analysis that you're doing. Have you given any thought or consideration to opportunities that would involve markets outside the US, such as Europe, are you really just focused on US sports betting at this point?

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

We consider all markets.

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

Okay, one thing to highlight -- yes, sorry. One thing to highlight. So I think we're not just looking at sports betting, I think we're looking at a variety of different opportunities in the digital space. And to Rob's point, in variety of different markets, but we're not rushed. So we're building teams, we're making long-term investments, we're thinking about opportunities, we're focused on return on invested capital. And we're really looking through the lens of long term strategy that can blossom into something meaningful. And so we're not, just sort of chasing certain specific areas that may have valuations that are peaked at the day. I think we're looking for long-term high-growth opportunities that present really positive returns. And so it's not just in sports wagering, its a variety of things, we're looking at different markets.

Dan Politzer
Analyst at Wells Fargo & Company

Got it. And then just a clarification on the capital allocation question from earlier. And as you think about a repurchase versus the dividend, I mean do you really need to see a more sustained recovery in Macao before returning capital? Or is there a scenario where you get the proceeds from the Vineis in the sale and Singapore starts to recover and you could be more active on that front beforehand?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

I think from our standpoint, we sort of view return of capital for a very long-term shareholder enhancing process. And I think for us, we're going to want to see a return in our markets with a stable level of cash flow and post-pandemic conditions where there is operational clarity before we begin the return of capital. I think it's very important for the sustainability of any dividend and a return of the capital program.

And it's something that we hope will come soon there's been a lot of investment in public health initiatives and a lot of things are incrementally making progress in both of our markets and we're hopeful that this occurs in the near term. And so once that happens, we'll start to evaluate potential for return of capital, but again we sort of view the proceeds from the Las Vegas Sands as permitting us to develop large-scale destination resorts in new jurisdictions to help grow our business.

Dan Politzer
Analyst at Wells Fargo & Company

Got it. Understood. Thanks so much.

Operator

Your last question comes from the line of David Katz with Jefferies. David, your line is open.

David Katz
Analyst at Jefferies Financial Group

Good afternoon, and thanks for taking my question. I just wanted to -- if I may follow up on to the details from earlier, where you talked about the $70 million and that sounds like it's in the EBITDA line. Is that solely in Macao, is that spread, does that include Singapore?

Patrick Dumont
President and Chief Operating Officer at Las Vegas Sands

It's just Singapore.

David Katz
Analyst at Jefferies Financial Group

With respect to the $500 million run rate, which is Macao that is excluding what may or may not have occurred with respect to Omicron in January, correct?

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

No, I think, David, we're mixing apples, oranges. I think first of all, the $70 million, Pat referenced was solely of MBS and my $0.5 billion reference was in previous calls, as I think the current situation, which runs up and down every day we've, I think in Singapore today is $0.5 billion EBITDA annual run rate until we get for the retail and stabilization. My point is I want to assure we're running at same $0.5 billion. We have a lot of optimism that will change in '22 perhaps per se. But that's all Singapore-related, the one-time non-recurring.

And then the $500 million was referred to Singapore, as well. We're not making any -- it's impossible in Macao to rationally predict anything until the government makes decisions on the visitation. It's silly for us to speculate on something so speculative. You can -- have no underpinning the fact. I think once, but we believe that market will explode and open back up again. But I think it's more -- I think it's more of second half of the year. But then again, Houston now. So when I make any speculative decisions on run rate in Macao.

David Katz
Analyst at Jefferies Financial Group

Understood. If I can just follow-up very quickly. With respect to the makeup of the business in Macao, not looking for a guide or a range of any insight around how VIP business which may go away could be recaptured through premium mass. Any tools or thoughts or perspectives to help us think about what portion of that could be -- would be really helpful.

Robert G. Goldstein
Chairman and Chief Executive Officer at Las Vegas Sands

Yes, just keep in mind, quick look now on Grant's point as well. I think we all believe that the junket having done this for many years in Macao and the US. These customers in that segment are going to just disappear, when they read the other junket business is not happening. Therefore, demand will go away, it's not going to go away, it will just resurrect in different segments and find new ways of materializing in the casino.

It is that any business, it goes back to any segment business we just go away because the mechanism goes away. It's just the bars of different segmentation. So, we're pretty bullish that a business that was yielding 8%, 10% could be much more positively profitable as a resurrection of these segments. And so, that's my take. I think any belief that the junket business, the whole segment as always, it's just not thoughtful.

Grant, can you weigh in?

Grant Chum
Chief Operating Officer, Sands China at Las Vegas Sands

Sure. Yes, I think Rob has spot-on on that, because you have to distinguish between the end demand and the distribution of it. So, I think clearly some portion of the end demand, and we're not going to get drawn into exactly what proportion will shift into other segments, and that's just natural because the end demand is there. Now with some portion of that also is to pay and disappear, sure, but that's probably the portion that was not in the first place that sustainable in any event. So I think the core underlying end-demand that will find its way through other segments over time. And we should distinguish between the end customer as opposed to the distribution system.

David Katz
Analyst at Jefferies Financial Group

Perfect. Thank you very much for taking my questions.

Operator

[Operator Closing Remarks]

Corporate Executives
  • Daniel Briggs
    Senior Vice President, Investor Relations
  • Robert G. Goldstein
    Chairman and Chief Executive Officer
  • Patrick Dumont
    President and Chief Operating Officer
  • Grant Chum
    Chief Operating Officer, Sands China
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