Sands China Cleared To Restart Construction; Labor Unrest Looms

Las Vegas Sands Corp.

and its majority-owned Sands China Ltd. (HKSE: 1928), obtained government clearance to re-start construction on the $2.7 billion Parisian Macau Tuesday, even as a labor protest clogged the streets there. Construction had been suspended in June following an on-site accident and Sands said recently it had expected the new permit in October. On Sunday, more than 1,000 labor union members held their seventh demonstration this year in Macau. The Macau Gaming Industry Frontline Workers union is demanding a 10 percent wage increase. Analysts have increasingly worried that rising labor costs in Macau will hurt profit margins. The Parisian casino will require thousands of additional workers and is to include a half-scale replica of the Eiffel Tower as well as a 3,000-room hotel. Sands said recently it's studying whether to open it fully or in phases in 2015. Sands China posted first-half net revenue of $5.08 billion, up 25 percent from $4.07 billion a year ago, while earnings grew 46 percent to $1.37 billion. Macau is the largest gaming market in the world and the only market in China to offer legalized casino gaming. According to Macau government statistics, annual gaming revenues reached $45.3 billion in 2013, up 18 percent from 2012. Las Vegas Sands traded recently at $67.95 a share, down $0.76 cents.