Sands halts projects

Casino operator Las Vegas Sands, which warned last week that it was in danger of defaulting on loan agreements, said Monday that it would suspend construction in Macau as it copes with a lack of financing.

The Sands also reported a narrower third-quarter net loss and that it expected to release details shortly of a $2 billion bond sale.

"We have elected to significantly slow the pace of our development activities on the Cotai Strip" in Macau, said William Weidner, the Sands' chief operating officer, said. The casino company will "focus our current efforts on maximizing our cash flow and our returns on invested capital from our existing properties in Macau."

Shares of Sands, which have plummeted from a 52-week high of $122,96, closed Monday at $8 on the Nasdaq in New York, only to fall in after hours trade to $7.45.

Sheldon Adelson, the Sands' majority-owner, said during a conference call that the Macau government might help find financing for the projects.

The Sands expects to finish raising the capital this week, including contributions from the Adelson family, removing the risk of the parent company tripping loan covenants, executives said during a conference call. A "major Chinese bank" may lend the company as much as $700 million to continue its stalled Macau projects, Adelson said.

The company also said it would suspend work on the St. Regis luxury-condominium project in Las Vegas and would focus on the casino components at its Bethlehem, Pennsylvania, development.

It still expects its Singapore project, the Marina Bay Sands, to open next year.

But the company said in a U.S. Securities and Exchange filing on Monday that if it was unable to raise additional capital in the near term, it would need to consider further suspending portions, if not all, of its remaining global development projects.

Sagging U.S. consumer spending has hurt business in Las Vegas, where Sands operates the Palazzo and Venetian resorts, as well as the Sands Expo and Convention Center.

The company operates two casinos in Macao, where officials have recently restricted travel from mainland China, and had several more projects underway there.

The Las Vegas-based company posted a net loss of $32.2 million, or 9 cents a share, compared with a net loss of $48.5 million, or 14 cents a share, in the year-earlier quarter.

Sands attributed the smaller loss to increases in operating income and an income tax gain, partially offset by an increase in interest expense and a decrease in other income.

After adjusting for one-time items, Sands said it earned 2 cents a share in the quarter, well short of the 11 cents a share expected by analysts, as compiled by Reuters Estimates.

The company said net revenue rose 67 percent to $1.11 billion, close to the $1.16 billion expected by analysts.

The casino operator has also filed a shelf registration with regulators that would allow it to sell securities.