Good day, ladies and gentlemen, and welcome to the Sands' First Quarter 2024 Earnings Call. At this time, all participants have been placed on a listen-only mode. We will open the floor for your questions and comments following the presentation. It is now my pleasure to turn the floor over to Mr. Daniel Briggs, Senior Vice President of Investor Relations at Sands. Sir, the floor is yours.

Thank you, Paul. Joining the call today are Rob Goldstein, our Chairman and CEO; Patrick Dumont, our President and COO; Dr. Wilfred Wong, Executive Vice Chairman of Sands China; and Grant Chum, CEO and President of Sands China and EVP of Asia Operations. Today's conference call will contain forward-looking statements. We will be making these statements under the safe harbor provision of Federal Securities laws. The Company's actual results may differ materially from the results reflected in those forward-looking statements. In addition, we will discuss non-GAAP measures. Reconciliations to the most comparable GAAP financial measure are included in our press release. We have posted an earnings presentation on our website. We will refer to that presentation during the call. Finally, for the Q&A session, we ask those of interested to please pose one question and one follow-up so we might allow everyone with interest the opportunity to participate. This presentation is being recorded. I'll now turn the call over to Rob.

Thanks, Dan, and thanks for joining us today. The Macao market continues to grow as it has each in the past five quarters. Since the reopening in early 2023, the annual run rate of the market has grown every quarter from $17 billion in Q1 of last year to $22 billion, then $24 billion and $26 billion, now reaching $28 billion in annualized gaming revenue. We remain confident -- so fully confident in the future growth of the Macao market. I've said in the past, Macao market will grow to $30 billion and then $35 billion and then $40 billion beyond in the years ahead, I remain steadfast in our belief. We remain equally confident in our business strategy to invest in both the quality and scale of our market-leading assets in Macao. Our capital investment programs ensure that we will continue to be the market leader in the years ahead. Our investments position us to grow faster than the market over the long term to grow our share of EBITDA in the market and to generate industry-leading returns on invested capital. Turning to our current financial results for Macao. We delivered a solid result for the quarter despite the disruption of our ongoing capital investment programs. SCL continues to lead the market in gaming and non-gaming revenue and most importantly, in the market share of EBITDA. Because of our market-leading investments, we will capture high-value, high-margin tourism over the long run. We have a unique competitive position in terms of scale, quality and diversity of product offerings. Upon completion of the second phase of the London and our co-tying redevelopment program, our product advantage will be more substantial than ever. Turning to Singapore, we delivered a record quarter. We believe it's a record for the industry. So the team there has done an extraordinary job, and this is what happens when a superior product is located in the proper market. Our financial results in Singapore reflect the impact of our capital investment programs and our service capabilities. The appeal of Singapore as its tourist and destination and the robust entertainment and lifestyle event calendar also contributed to the growth at MBS. As we complete the balance of our investment programs, there will be a lot more runway for growth in the future. Thanks for joining us today. I'll turn it over to Patrick for more details.

Thanks, Rob. Macao EBITDA was $610 million. If we had held as expected in our rolling program, our EBITDA would have been higher by $31 million. When adjusted for lower-than-expected holds in the rolling segment, our EBITDA margin would have been 34.4%, or up 380 basis points compared to the first quarter of 2023. This highlights our focus on cost discipline and profitability. The ongoing capital investment programs at The Londoner and at the Cotai Arena had an impact on our results this quarter. The Cotai Arena was closed for renovation in January this year. After the significant reinvestment and renovation, the arena is expected to reopen in November. In terms of the second phase of the Londoner, we have now commenced the room renovation on the first Sheraton. We plan the completion of the first tower by year-end and of the second tower by Golden Week in May of 2025. The renovation of the casino on the Sheraton side of London will commence in May of this year with the reopening scheduled for December of 2024. While there will be ongoing disruption from these capital projects, as these products come online between the end of '24 and the first half of '25, our competitive position will be stronger than ever. The scale, quality and diversity of product will be better than we have ever offered before. They will be unmatched in the market. Turning to Singapore, MBS and EBITDA came in at $597 million, an all-time record for the property and for the industry. Our strong results reflect the impact of high-quality investment and market-leading products. Had we held as expected in our Rolling Play segment, EBITDA would have been $77 million lower. Had we held as expected in the Rolling Play segment, MBS EBITDA margin would have been…

Thank you. Ladies and gentlemen, the floor is now open for questions. [Operator Instructions] And the first question today is coming from Stephen Grambling from Morgan Stanley. Stephen, your line is live.

Hey, thanks so much. You talked to the March higher for the market in Macau, but this quarter looks like the margin flow through and EBITDA actually went in the other direction. How should we be thinking about flow through in Macau and operating expenses going forward in that market?

Yeah. I just want to say one thing before we turn it over to Grant. I think some of this has to do in Macau with some of the disruption that we experienced during the quarter. So when we take the arena in January, we lose the benefit of our entertainment programs during a peak period. That did have an impact. So when you look at our operation, you compare it to Q1 of last year, Q1 of last year, we were coming out of the pandemic and it really took a while for visitation to get started again. This year, unfortunately, we did this to ourselves. We started renovating our arena. It's a very powerful asset. It has lots of entertainment and went through the Chinese New Year period and unfortunately, with some hotel rooms out and the arena out, we felt on the revenue side. So as we've said before, as the market continues to grow, we will do well. We have the best product. We've invested the most in non-gaming assets. We have the most amenities to offer to our patrons and they're very high quality, diversity of retail, diversity of food and beverage, diversity of entertainment, which is very important. Unfortunately, we didn't have that tool this quarter in full swing. We only had the London arena, which is good, but it can't compete with the Cotai Arena. So I think for us, as the revenues continue to grow, as you've seen in prior quarters, our margins will fall in line. And you see that in the Venetian, as the revenues are where they need to be, the margins fall in line as well. So that's sort of the headline from the margin performance this quarter. I do want to turn it over to Grant to see if he has any additional color.

Yeah. Thanks, Patrick. I think the most important point is still the GGR is growing in the market, and I think if you look at our profitability, at this level of GGR, I think we should be looking at low to mid-30s in operating margin -- EBITDA margin, and we're right at the high end of the range there. Obviously, each quarter there's seasonality relating to different parts of the business, the revenue mix. So first quarter, I think 34.4% in terms of underlying margin is a really good number. I think 2024 is going to be one that is impacted by our capital works and the renovations that Patrick referenced also in his opening remarks. We have obviously, started the hotel renovation in the first half of Sheraton, and down -- we're probably down about 500, 600 rooms in the first quarter on average in that hotel. But the number of keys that will be out of inventory will increase further in the second and third quarters. And of course, Cotai Arena, as Patrick referenced, that's always been a core part of our content programming, our content offering, and we were able to offer plenty of shows at the London Arena. But if you just compare -- just the sheer number of shows that we had in the first quarter, we had 12 shows compared with the fourth quarter last year, we had 31 shows. It's a big difference. And obviously, in terms of capacity, there's a big difference. So the attendance per show obviously was much higher in the fourth quarter as well. So hopefully, that gives you some color in terms of the disruption that had on our business with the arena being closed for renovation. And as I said, the hotel renovation is ongoing and you're going to see more keys out of inventory in the next couple of quarters.

Got it. And maybe one clarification. I guess in the quarter, industry-wide, I'm not sure, maybe I missed this in the presentation or I haven't seen the slides, but is VIP -- the VIP actually grew faster than mass overall in the first quarter for the industry. And how are you thinking about base mass versus premium mass from here? I know you kind of touched on this a little bit, but would be curious about the industry-wide thought process.

Rob, should I take that?

Yes. Yes, please. Yes.

Yes, you're right. I think if you look at our slides, the mass revenues sequentially would be around 4%, and the overall GGR for the quarter grew at 6% sequentially. So yes, the VIP revenues in the market as a whole grew faster than the mass revenues Q-o-Q. I think in terms of the premium mass versus base mass, again, I think you can see it from our slides. Premium mass grew slightly faster for us in this quarter, but the difference is not material when you account for things like whole percentage and patron counts and so forth. So I wouldn't say, there's a material divergence in the growth rates between premium mass and base mass, and it's part of business for the quarter.

I think it's important to note that -- it's important that the visitation still isn't like it to be. Obviously, there's still millions of people have not come versus the 2019 visitation numbers. We believe long-term visitation GGRs did grow, whether it be base or premium, we'll get more than our fair share. And I think we've seen obviously, I'll say the obvious, the promotional situation the market has changed and more people incent doing things. And once everyone starts playing that game, I believe that will resolve itself. We believe that assets will prevail. We believe London will be extraordinary asset much like it's happening in Singapore. I think our results in Singapore reflect a fully developed program and the execution in Singapore shows what can be done. We have the right kind of assets. What we have even done in Singapore the number is extraordinary. The same will happen in our business in Macao in time. As DGOs accelerate and they will, visitation accelerates and it will. We'll continue to be margin-focused, even without focus, and get more than a fair share and assets will prevail over promotions from our perspective.

Got it, thanks. I'll jump back in the queue. Appreciate it.

Thank you.

The next question is coming from Carlo Santarelli from Deutsche Bank. Carlo, your line is live.

Hey, guys. Thank you. Just following up on the first quarter margins. If I look at the fourth quarter, for example, and kind of extract the big element of turnover rent that comes in and obviously, very high flow through, it looks like margins are probably fairly similar. So it doesn't seem like a lot changed on that front. Is that accurate? Or am I missing something else seasonally there?

Primarily you're correct. That's a fair statement to make. The term red does, as you know, as you know to occur in the fourth quarter, and it's material. Grant, do you want to add to that?

Yes, it's accurate. You're right.

Great. Thank you. And if I could, just one follow-up on capital allocation. Obviously, over $400 million of buyback in this quarter. As you guys think about the capital needs here going forward, the stuff that you've announced, the stuff that obviously, is being contemplated and looking for budgets around and whatnot. Do you feel like that this pace is adequate and where you want to be as you look throughout the balance of this year?

Yeah. So I think first off, I just want to say we see value in both equities. And I think, we have a very long-term bullish view given the market opportunity for growth, our market-leading investments and our assets, and just how we feel about the opportunities in both markets that we have. So as we said before, we're going to be overweight share repurchases. As we think about future capital return, we are going to be more heavily weighted towards share repurchase and dividends. We think the repurchases are going to be more accretive than dividends over time and we want to shrink that denominator. And so I think we're going to look to make purchases that are consistent with our share authorization by the Board and with prior practice. And I think we'll look to be a little bit opportunistic. We may vary levels, but I think we're going to continue to be aggressive in the market. I mean, I think you see with the $450 million of LVS shares, the SCL share repurchases, we think this represents an interesting opportunity just a moment in time. And so we're going to try to take advantage of it. We happen to have a very strong balance sheet. We have a lot of liquidity and we tend to put it to use. So I think we're pretty happy with where the program has taken us so far -- both so far and we'll continue to use it and we'll see how it goes across the year. But we're going to look to repurchase more shares.

Thanks for that, Patrick. Just one aside. Guys, I'm not sure the slides are actually posted yet. It certainly could be a user error, but it looks like that they haven't posted yet for the first quarter.

Yeah, we're working on it.

Thank you.

Thank you. The next question is coming from Joe Greff from J.P. Morgan. Joe, your line is live.

Hey, everybody. I was hoping one of you could maybe help quantify the revenue and EBITDA impact from the renovations going on at Londoner and Cotai Arena. And then do you see that renovation disruption impact accelerating, and when do you start to see that decelerate? I know you kind of talked about the two towers and when they open up, but to kind of help understand that renovation impact in terms of how you're seeing it, and I think would be helpful for everybody.

Yeah. I don't know that we can necessarily quantify accurately what the impact was because we can't know what we displaced. You heard Grant describe the number of missing shows and the number of people typically will go to those shows in the Cotai Arena, and you get a sense of the type of high-quality patron that we bring in when we have live entertainment. And it is impactful. I think Q1 typically is a very powerful quarter for us as is Q4, and you kind of see the difference that the impact had for entertainment. We made a decision that if we take the arena offline and do it and make it the high -- one of the highest-quality arenas in Asia, then in the long run, we will benefit from the entertainment. And so we decided to do it as quickly as possible. And so that meant taking it offline in January this year and trying to get it done by October-November. And so once we do that, we're going to have an incredibly high-quality arena with amenities that we've never had before. So it will make us more competitive in the market and actually drive additional high-quality tourism from both traditional markets and other markets and will also help drive high-quality tourism from our core customer base and allow for more repeat visits from our high-value customers. We're very excited about the opportunities this new entertainment asset will present to us. Unfortunately, we're going to take some pain while it's offline, and that really started in January of this year. I can't quantify the exact amount, but you hear the count from Grant and you realize that it is not immaterial. And then the other side is, we're taking the shared it out. And when we're done,…

I think you covered it perfectly. I think the only thing I supplement is Londoner phase one really gave us that elevation in the shared quality of product, as well as a very successful rebranding and repositioning of the entire property. But what phase two gives us is that scale of high-quality product and the diversity of it. And that's when I think the earnings power of this resort will be fundamentally transformed.

Perfect. And…

I believe what we think once Londoner -- we think once Londoner is done, Joe, we'll have the one and two -- number one and two assets in the GALP, by far. Not sure whether they'll be fully in front, but that company really gives us a unique positioning for '25 and the years ahead to dominate the market in terms of the largest resorts and those proper resorts, both one and two.

Great. Thanks, Rob. You may have answered my follow-up question indirectly on your prior margin commentary, and maybe this is something Grant could talk about. But can you talk about the level of the markets, premium mass reinvestment levels? Has that been pretty consistent in the first quarter? And what you're seeing year to date versus how the end of the year finished? Or is there any kind of trend change on that front? That's all for me. Thanks.

Thanks, Joe. For us, yes, our profitability, the structure of a margin in every segment actually, quarter-on-quarter very consistent. No significant changes there. And that obviously, fed through to the result that the earlier question described, which is that we had a very consistent margin quarter-on-quarter despite obviously, some inflation in the payroll costs due to holiday pay and salary increases.

Yeah. My question -- maybe I didn't explain it that clearly. The level of premium mass reinvestment from your competitors, how would you characterize that year to date versus the end of last year?

Oh. Sorry. You're talking about the overall market now.

Yes.

Direct investment invested to customers.

I think the promotion activities levels are relatively intense right now. Is it higher than Q4, I don't think so, but it comes and goes and goes up and has ups and downs. But I think over time, there really isn't any necessity in this market to be too aggressive on promotions. The demand and supply, supply-constrained market, the quality of supply is exceptional, and we are a big contributor to that. And as GGR rises, that becomes even less of an issue over time. And for us, it doesn't matter. We stick to our strategy, which is as Rob referenced product based is driven off our asset base. The upgrades we're making, the quality of the assets and the services that go with that in addition to the programming -- the content programming, and like we talked about, we're very big believers in that entertainment being co-offering. That's why we're investing this $200 million in the upgrade of Cotai Arena. So -- yeah, when it's all said and done, we believe that GGR continues to rise, our asset base is going to be better than before and better than ever. And that's the way we're going to compete and that's the only way we think we can compete on a sustainable and profitable basis is really based on the quality execution of a product and the service that go with that.

Thank you.

Joe, we're obviously, keenly aware of the commercial environment down. We're certainly aware of what's happening with Macao promotions, but we remain steadfast. I believe that our product, once completed, will be superior. The scale is greater. The market will grow, and that's how we'll capture our fair share and remain focused on margins and keeping our EBITDA once again. So we're not going to play the game of chasing $10 more for promotions. We don't think it's our business and who we are. We're an asset-driven company with quality assets and scale. And again, we've proven that time and time again, and once Londoner is done, the arena will be just want to be in terms of market leading and margin of the assets and the cap.

Thank you. The next question is coming from Shaun Kelley from Bank of America. Shaun, your line is live.

Hi. Good afternoon, everyone. Sorry if I'm beating the dead horse here, but I did want to just kind of stick with the margin commentary, but I'll give it a little bit of a longer-term view. My question is really just trying to get a sense of what would it take to get back to let's call it the mid to high thirties on margins here. Is what we're seeing today and now increasingly expecting for the balance of '24 more about customer mix? Or is it about sort of one time callouts around renovations and maybe some lost very high-margin non-gaming revenue?

So it's a very interesting question, and it's the right question to ask. So as these properties reach run rates so as they reach their full potential, the margin should be upper 30s [Technical Difficulty] Sorry. I think someone in Sands China put us on hold. Please excuse us. So we think about margins in the upper thirties. If you look at the performance of the Venetian, that's a good benchmark, right? It was impacted a little bit this quarter, again, also by the entertainment not being there in the Cotai Arena, but -- and mix-wise, to be fair, pre-pandemic, it had more mass play and that's a higher margin. And so as tourism returns, so as visitation increases, which has more mass play, and we have plenty of capacity for it. So if you look at our asset base, the scale of the assets, the food and beverage we have, the amenities we have, we can accommodate a lot of mass play, and we have the positions to do it. And so for us, as visitation shows up and continues to on an upward trend, our assets are ready to take that visitation, revenue will grow, margins will grow, and they will normalize back towards a more traditional mix. That being said, the Londoner has the opportunity to also bring a lot of high-value tourism. So we're carrying the expense base without the revenue, right? So we have the team members, we have the -- we have all the things going on that you have, that we're fully operating, but it's not fully operating at. So the margins naturally are not going to look right. So as the revenue comes in and as the visitation comes in, as the patrons come in, as the hotel is completed, and as…

Thanks, Patrick, and appreciate the insight. As a quick follow-up for whoever as appropriate. Just looking at Singapore, I mean, obviously, a breakout quarter with a run rate above $500 million. There were some one time things in that market, Taylor Swift, I believe, being one and then, of course, which I think you called out event activity broadly speaking. But also there's a change in, I think, Chinese visa policies that was probably potentially fruitful for the market. So just the big question here is, what's the right run rate? And do you think again, maybe event activity agnostic we could sustain above the $500 million mark? And are we kind of off to the race here? And notwithstanding the fact that even that number sounds like it included a little bit of tower three disruption.

I think the first thing you should note is that the building is still under renovation. I think we believe $500 million a quarter annualized is very durable and more. And the most important thing you should note is two things. The growth in Singapore as a desirable destination is soaring. It's not just Taylor Swift. It's Bruno Mars. It's the Hamilton show. It's endless events, F1. It's a juggernaut. And really, it's become accelerated. This market has become very special in a very short order. And I think that's attributed to government there and the programs happening, entertainment, et cetera. So Singapore is highly desirable, and yes, that's very sustainable. And as good as Taylor Swift was, there's a lot more in the pipeline that will make that continue. Secondly, our building has less than 200 top tier suites. Upon completion, we'll have an excess of 700. The suite-spot on the market is the premium mass and super premium mass, rolling, non-rolling. We can't -- I think we're almost approaching a billion dollars a slot when we may be out of bullets there as we get more capacity. But this is a very special market. Our building is a special building. I don't think there's any reason to doubt that 520, 540, 600. Look, this may keep growing. This is a great place to be. We're lucky to be there. We're lucky that the government is very supportive and excellent team in place. But most importantly, the assets, it didn't happen by luck. We are doing -- spending a lot of money to make sure those assets are superb and the customers come back time and time again. The real question is what happens when the building has four wheels instead of three? That's going to happen later this year, in early 2025, when those suites are rolled out and they are great suites. They are phenomenal suites. Can that building go to two-two, two-four, two-five, it can and it will. And I think, again, what we're trying to tell you about Macau is we're frustrated by Macau. The operating environment is more difficult. We're under construction a self-inflicted wound. But once we emulate in Macau and we've done in Singapore, the same thing will prevail. Londoner I wish neck and neck to drive that market. And again, I think the government recently talked about a lot of things they're trying to do. Increase tourism and visas, et cetera. We see a real nice support system coming out of now, and we're grateful to the government for recognizing a session this week about increased tourism, increased entertainment. We're lucky to be in two very, very special places, and, yes, Singapore can do 500, they can do 550. It's not about Taylor Swift. It's about a great market, a great asset, and a team running it.

Thank you.

Thank you. The next question is coming from Robin Farley from UBS. Robin, your line is live.

Great. Thanks. I just wanted to circle back. You were commenting earlier and the slides were not up yet so I haven't been able to go through them. But it sounded like you were saying that your sequential growth in mass and premium were both at a similar rate sequentially. And just wondering if there's anything to add any color around that since, you know, the market has generally speaking been seeing better premium mass recovery. Just any color you'd add there.

Grant, I think you should take that. Grant?

Yeah, Robin. I don't know if the deck is up.

It's up now.

It's up now, I mean.

It's up, guys. Yes.

Yeah. So if you look at a premium mass win, we're up 2% quarter-on-quarter, and base maths were down 3% quarter-on-quarter. But I think my point earlier is the difference that's here and there could be related to any number of I think non-substantive factors. So I wouldn't describe this as a divergence in trend, but this quarter we just did slightly better in premium mass versus base mass. Visitations continue just like see the wider market growing. Our property visitations actually grew sequentially as well. So nothing significant to remark on in terms of the segment divergence.

Okay, great. That's helpful. Thank you. And just any thoughts around New York timing and your expectations there? Sort of anything new to add there? Thanks.

Yeah. But we're very disappointed by New York. I mean, we've been working there for a long time and we thought it was going to happen in '24. That was the state. Now they're saying '25 or '26, but I don't think we have any real clarity. And to be honest with you, it's confusing and disappointing because we've done a lot of work in New York and a lot of time into it. So I have no guidance because I don't really know what to tell you with candor and insight. Just don't know about New York. And it's just wish -- we wish they figured it out and let us know. We just don't know. So we'll remain hopeful that things turn around there.

Okay, great. Thank you.

Thanks, Robin.

Thank you. The next question is coming from Vitaly Umansky from Seaport. Vitaly, your line is live.

Hi. Good morning, guys. I think maybe switching over to Singapore if we think about kind of the quantifying the effect of what the renovations at that property have already done, and Rob, you talked about potentially this property getting up to about $2.4 billion, $2.5 billion. In theory, once the renovations are done in the first phase of the property, where do we see kind of constraints being built in? Because if you look at kind of occupancy rates in the hotel rooms today and we look at ADRs, they continue to expand. At some point, we're going to reach a limit as to how many rooms can be filled, and then we're talking about trying to fill rooms with higher-value customers. So when we think about before we get to the expansion, where is that constraint, and how quickly do you think we can get there?

It's a good question. I think unfortunately, it's probably an answer that we've seen that we never dreamed slots with a billion dollars on property that they're approaching that. We never dreamed that in this environment. So quickly after COVID, we reached the kind of epic levels we're seeing. The growth in the premium mass is powerful and I was enjoying Grant on the call last week telling us it's still a drop in the bucket. There's so much more to go. And so I think the growth will come out of this super premium mass, both rolling, non-rolling. I don't think ADR is all that impactful because hopefully someday we won't sell many rooms. This will be a product that is mostly gaming customers in the rooms. I hope the suites we're building are just exemplary. And I think that this product is only going to have more good days ahead. I used to do five as a goal for our Company as the decade progresses and it's very attainable. It reached $600 million almost this quarter in actual is very stimulating. It's very exciting. But the cash in capacity, it's already a problem for us in terms of slot machines. It will be a room problem. We wish you had more exposure to Singapore that's why we're building more products. This is a very, very special place that people gravitate to. And as Singapore does its job as a lifestyle, entertainment, exciting place to visit, demands have grown. So the only concern we have in Singapore is how quickly we get there. Once these fleets are unleashed in the market, they see it. I think we'll have some very bright days ahead. But obviously, it's a capacity constraint. You only have so many rooms, only have so many slot machines, and I don't worry about getting there. I just think we get there, we'll be disappointed can't have more exposure, and that's why we're building phase two.

Hey, Vitaly, one thing, and welcome back to the call. I think the key thing for us is we have a very strong view of the future success of Singapore. So strong that we're investing a couple of billion dollars in this property and we're looking to do IR2 as quickly as we can. We think that this market is benefiting from a lot of the factors that make Singapore, great infrastructure, strong, stable government, great investment, great policy. And to be fair, you're seeing the result of it. And it's only our business, as many businesses in Singapore. And so I think that that's a very helpful indicator. But more importantly, the more other investment that goes into Singapore will help drive further visitation. So the infrastructure is already there. The real question is how many more hotel rooms will go in. We feel very strongly that the more hotel rooms are added will help add to the critical mass of tourism that Singapore already has today. If you look at the wealth creation going around in Southeast Asia, it's pretty substantial. The last four years, even during the pandemic and they're pretty meaningful. And there are a lot of customers that are new to Singapore, new to Marina Bay Sands, and they're affluent and very successful, and they want to consume and they want to take advantage of the Singapore -- things Singapore has on offer. And so we feel very strongly about the future visitation in Singapore. It's an interesting question, where is the peak of demand? We don't really see it right now. What we see is a supply constraint, right? When you look at who is trying to come to Singapore and the activities that are going on, we feel very strongly about future investment. We think it's there.

Thanks, Patrick and Rob. Maybe just a follow-up, switching gears to Macau. And Grant, you talked a little bit about kind of the base mass and the growth you've seen in the quarter is very similar to premium. But I think overall, if we kind of think about sands in Macau, obviously, you're very strong in the direct VIP business, you're very strong in the premium business, but where you have a massive competitive advantage? In my view, it's just your scale, which then talks about base mass and the higher margin available from base mass. If you look at the recovery in overall base mass, it has not been as strong as the more premium end of the market. Can you maybe give an explanation as to why you think that is, if you agree with that statement, and then how does the market maybe change, or need to change over the next couple of quarters in order to get some of that base mass back, which I think would benefit Sands relative to others in a much stronger way?

Yes. Thanks.

Grant, go ahead.

Yeah. Yeah, sure, Patrick. Yeah, I'll take it. And I think first point is your -- I agree we have a huge advantage with our scale, but I think the scale advantage speaks to all the segments. I think if you looked at historically, how the company has developed absolutely the base mask with our scale, that has been a core advantage. But in the sense of how we described all of these capital investments that we're making, especially in Londoner, the scale we have on the quality of the premium product is really unprecedented. So I think scale advantage will apply to all segments, in my view. Specifically on base mass, if you look at our actual numbers, the way we break it out between premium mass and base mass through the recovery since the reopening after the COVID restrictions, actually they're not too dissimilar now in terms of rate of recovery from a volume and revenue perspective. But it is true that in terms of customer count patron hours, we're still missing more from the base mass. So really it's two things it tells you. One is the quality of patronage has risen significantly because the revenue per patron is higher than before COVID. And secondly, there is still room for that base mass revenue and visitation to further recover. And I think there are many reasons and it's hard to specifically attribute to one or two factors, but I think over time, especially as the economy improves and also so I think people -- the distribution of content in terms of the lifestyle, the destination attractions, all of the events, all of the non-gaming products and assets and events that are actually distributed out there, I think you see a progressive improvement in that base mass segment. And obviously, we will be -- obviously, best placed to capture that growth when that comes.

Thanks, Grant. That's helpful.

Thank you. The next question is coming from Chad Beynon from Macquarie. Chad, your line is live.

Afternoon. Thanks for taking my question and thanks for posting the slides. On Slide 44, the flags of interest remain the same as what we've seen in the past couple of decks, Macau, Singapore, New York, and you've talked through all these. There's been some recent discussions around Thailand and some even think that an integrated resort could open in Thailand, maybe even ahead of Japan. So wondering if you could opine on your views. I know early, but could this market be big enough? Could a resort generate the cash flow meaningful enough for you guys to look at the market? Any views there? Thanks.

Yeah. We absolutely have interest in Thailand. To your point, it could happen quicker than Japan. I think it's conceivable. It's early days, though we still have work to do with the numbers and understanding it. It's a very, very exciting market in a lot of levels, and just the sheer size of population, the accessibility and the willingness of people travel to Thailand, it's obviously, I think, number one resort destination city in Asia. So, yeah, we're very interested. But again, it's early days. I agree with your comments. It could be faster than Japan, which is possible. Certainly, there's usually a lot of pent-up desire from both business and government to work towards us. So we're interested, we're listening. We're doing the work to find out what makes sense for us there and we'll keep you posted.

Thank you. And then on the P&L statement, investors are increasingly looking at EPS just given what you're generating and where the stock is trading. I believe there was a tax benefit in Q1. Could you talk to that potential benefit? And then any additional color in terms of will the tax rate start to look similar to what we saw in prior years, given your mix of Singapore and Macau? Thanks.

I'll answer this in reverse. Yes, it will look more normal. It was a one-time item. It was related to reversal in Macau, $57 million. But the tax rate will look more normal going forward.

Thanks, Patrick. Appreciate it, guys.

No problem.

Thank you. The next question is coming from David Katz from Jefferies. David, your line is live.

Hi. Evening. Thanks for taking my questions. When we look at the Macao strategy in view of the renovations that are going on this year, I would think about, you know, reinvestment credit referral programs that people are talking about. What's your philosophy on those this year? And do you dial them back until next year? Or how should we think about that?

I'm just trying to understand your question. Will we dial back our investment programs because we're under renovation? Is that your question?

That's right. Level of conservatism versus aggressiveness and sort of how you…

No, no. We're not going to -- we will not dial back. We just may not be as aggressive as some of, you know, the competitive pressures on the commercial front right now, it's been talked about quite a bit. We're not believers in that approach. We believe we make our buildings the best in class. We have the scale. We have a lifestyle product. We just believe long-term GGRs will grow. We'll participate in that. We'll be very, very here into good margins, and that's an important part of business. But no, we won't dial back our current reinvestment strategy. We won't necessarily dial it up either to compete in the market right now. So this will be a year of reinvestment, as Patrick and Grant alluded to, both the arena and the Londoner. But we're not going to pull back. If anything, we'll stay consistent.

Perfect. And I wanted to just ask about, you know, one of the slides we show your maturities, you know forthcoming '25-'26, any sort of updated thoughts about, you know, how or when you're approaching those. And that's it for me. Thanks.

Yeah. So, you know, we're going to look to deal with. So if you go to Page 32, which is the page I think you're referring to, and you look at the LVS maturities, we should deal with those in short order. That's kind of our intent. And then in August of '25, we have the $8 billion that you see at the SEL level, and we'll address those in due time. We mentioned that we wanted to bring down our total debt level in at SEL given that we borrowed during the pandemic so you'll see us reduce the quantum of debt there. And then as part of the MDS credit facility, we'll address that in course along with the IR2 start. So that's kind of how we'll deal with our capital structure. You'll see us turn that out as we've done previously.

Perfect. Thanks.

Thank you. Next question will be from Daniel Politzer from Wells Fargo. Daniel, you're line is live.

Hey, good afternoon. Thanks for taking my question. First one on Macau. This is, I think, the second quarter in a row your mass shares declined a little bit. Obviously, there was a lot of different factors this quarter, but if you could kind of maybe give us a little bit more color. Is this really just disruption, heightened promotional levels? Or is there a difference in the customer that you're seeing coming into the market, or maybe something else altogether that's kind of driving the market share shifts we're seeing on the mass side?

Yeah. I do want to point out before Grant answers this question, that when we have less revenue because of disruption, we'll have less market share. So I do want to point out that with the arena being out with less revenue and a slightly lower margin because of the impact, having some hotel rooms out, that our market share will be impacted because it's the same thing. So with that, I'll just turn it over to Grant.

Yeah. I think it's hard to say which factors. I mean, you have a promotion environment out there that people have been talking about and that Rob reference you have, obviously, the disruptions that we've encountered because of our own projects. But on the other hand, it's also just looking at a very short time period here and there. So, yes, our mass revenues were flat for the quarter and the market grew 3%, 4%. But there's also a lot of factors that could have swung our way during the quarter and we would have been much closer to the market growth rate. So I wouldn't draw too big a conclusion from that. If you look at historically how we've sustained our share of EBITDA in a pre-pandemic, the market shares fluctuate, but we always end up back in that low to mid-30s range in terms of EBITDA share. And to be fair, let's look at a longer time frame, let's look at the scorecard for 2023, we achieved 35% EBITDA share against a GGR share of 26%. We were leaders in GGR, yes, but we were, by a much bigger margin, the leader in EBITDA share as well as non-gaming revenues, where we had 41% of the share of the market. So in aggregate, for the year, if you look at revenue gaming, non-gaming EBITDA, I think our performance has been solid. But quarter to quarter, obviously there will be fluctuations depending on those factors that we just discussed.

Got it. And then just for the follow-up, I think you guys have gone up to 71% share of 1928 HK. I mean, can you talk about maybe where that goes over time? Is there an upper limit there and maybe some of the puts and takes to increasing that ownership stake?

So I think there's an upper limit of 75% by exchange rules, although they do give waivers based on the size of the equity, depending on the name. For us, I think, as I said before, SEL is investing a lot for the future. It has a bright future ahead of it, and we'd like to own more of it. So you'll see us be aggressive, and I think where we stand, we see value in the stocks today meaningfully. So that is a repeat of what we said before, but I think you understand our conviction.

Understood. Thank you.

Thanks, Dan.

Thank you. The next question is coming from Colin Mansfield from CBRE Institutional Research. Colin, your line is live.

Hey, everybody, thanks for taking my call, and congratulations on getting the last rating up to investment grade during the quarter. Maybe following on to David's question about the refinancing, maybe just an updated thoughts on how you're thinking about the subordinated term loan down at Sands China. And I know there's a lot of liquidity up at the parent, but how are you guys thinking about timing of potentially taking that out of the capital structure down there? And then I have one follow-up on ratings.

Sure. I think you'll see us deal with LBS maturities and the SEL 25s before you see any activity around the LVS [Indiscernible] term loan down to SEL. The one thing I'd like to point out is that it benefits SEL. It's a very favorable loan and allows them to have high-quality financing deeply subordinated at a favorable rate. So from that standpoint, the maturity is '28, and we'll see how it goes with SEL and what their needs are and kind of go from there. But I think we have ample liquidity up at parent co we believe to do what we need.

Great. Thanks, Patrick. And then just one follow-up on ratings. I mean, obviously, the company fully back at investment grade now. And I think with the development pipeline that you guys do have ahead of you, I'd just be curious how you're thinking about any sort of change to financial policy as it relates to target ratings. I think this is one of the companies that could eventually get to mid-BBB if you guys so desired. So I guess how do you guys balance any sort of desire to have those levels of ratings as it relates to cost of capital relative to obviously, the development pipeline you have ahead of yourself?

Thanks. So I think as we look back pre-pandemic, we spent five years working towards investment grade. We think it's very important for us to actually be investment grade. It gives us access to the largest most liquid debt market in the world, gives us a very efficient cost of capital, which in the long run provides us flexibility, but really drives returns on new projects. We have this investment rate balance sheet. It helps us in new jurisdictions. You heard Rob talk about several of them. We have the financial capability to execute on these projects. Our financial policy always been that we like gross leverage to be between 2 times and 3 times. You know, we've said this for many years. Nothing has really changed. It's our consistent view. I think over time, we're going to delever just because of EBITDA expansion. If you look what happened at MBS, it occurred, and our belief is that it will continue to occur at Sands China as well. So I think for us, the investment grade is very important. That gross leverage parameter of 2 times or 3 times is consistent with prior statement, prior practice. And I actually think, you know, we're very favorably levered on a net basis and on a gross basis, and we're looking forward to doing some new development. And I think that will fit within our leverage profile based on sort of the prior discussions that we've had about progression of funding and EBITDA development. So we're very focused on it. We think we can handle our new development, our investment, our existing assets, and have a very healthy return of capital program while balancing all these things and having investment grade balance sheet. That's our goal and that's our view.

Great. Thanks again, guys, for -- thanks again for taking the question, and congrats again on getting fully back to IHE.

Appreciate it. Thanks so much.

Thank you. And this does conclude today's conference call. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation.