S&P Improves Rating of Las Vegas Sands and Sands China Due to Good Financial Management

The S&P Global Ratings has improved the rating of both Las Vegas Sands Corporation and Sands China Limited to BBB from BBB-, respectively. This decision reflects the agency’s assessment that the group will maintain a controlled approach to its financial leverage while limiting large-scale development commitments in the coming years. Alongside the corporate credit upgrade, the agency also increased the issue-level ratings for unsecured debt held by both entities, while keeping a stable outlook for the broader group.

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The agency anticipates that Las Vegas Sands will maintain an adjusted net debt leverage of approximately 2.5 times as it moves through the expansion phase of the Marina Bay Sands property in Singapore. Analysts state that this particular rating is adequate enough to provide protection for three times the amount of the downgrade. Currently, the company is carrying out an expansion project at Marina Bay Sands worth $8 billion, set to be completed and open for visitors by the year 2031. According to recent reports, $2.8 billion has already been allocated towards the project completion as of March 2026.

For the financial period of this project, analysts Rivka Gordon and Dan Daley have estimated that the company will need to invest an additional $1.8 billion in capital expenditure until 2028. The remaining $2.4 billion is anticipated to be spent after 2028, leading up to the project opening. The team also explained that the company plans to fund these costs using available resources from a delayed draw term loan specifically for its Singapore operations, which held $4.9 billion in available funds as of March 2026. Although the organization was formerly interested in expanding its operations in areas such as Texas and Thailand, the rating agency emphasized that the legal framework prevailing currently does not make it probable that gambling would become legal in these regions.

Additionally, the rating agency also noted that the recovering Macau market is one of the important pillars for the success of Las Vegas Sands. According to official statistics, market-wide gross gaming revenues grew approximately 14% in year-on-year terms during the first quarter of 2026. While the analysts expect this upward trend to persist, they also anticipate that growth will eventually moderate. This is due to factors such as limited new capacity, near-full hotel occupancy, and a slower pace for the return of base mass players. As such, their projections regarding the total market-wide gross gaming revenues of Las Vegas Sands for 2026 suggest that there will be a 7% year-on-year growth rate.

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Furthermore, analysts also pointed out that they believe margins to be more or less steady for the whole period of 2026. It is based on the assumption that competition within the promotions sector will be strong, while wage growth for employees will be rather modest. During the first quarter, the casino group managed to outperform the overall market by increasing revenue by 24%. This performance was attributed to the success of its reinvestment strategy, higher room capacity, and strong growth in revenue from VIP clients.

The agency observed that the company’s shift in its policy regarding shareholder returns since the onset of the pandemic has further strengthened its overall credit profile. The firm has increasingly moved toward utilizing share repurchases rather than relying solely on dividends. In 2026, total dividends are projected to reach about $1.05 billion. The S&P team noted that this strategic move toward more consistent share repurchases provides the company with the flexibility needed to allocate capital to growth opportunities as they emerge or to maintain liquidity during periods of operating volatility. Overall, total shareholder returns are estimated to be about $3.2 billion for 2026, with that figure projected to rise to $3.3 billion in 2027.

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Source: GGR Asia