Core Viewpoint - Sands China reported a net revenue of $2.058 billion for 4Q25, reflecting a year-on-year increase of 16% and a quarter-on-quarter increase of 8%, recovering to 92% of 4Q19 levels [1] Performance Review - The adjusted property EBITDA for 4Q25 was $608 million, up 6% year-on-year and 1% quarter-on-quarter, but fell short of the consensus estimate of $632 million [1] - The performance was attributed to increased marketing rebate projects and rising average operating costs [1] Development Trends - The company achieved a higher market share in gaming revenue of 24.5% in 4Q25, compared to 23.7% in 3Q25, driven by membership programs and growth in customers from other Asian regions [1] - Despite the higher market share, EBITDA was still impacted by elevated operating costs, including expenses related to hosting events like the NBA China Games and rising employee salaries due to increased gaming table capacity [1] - The high-end segment (VIP and premium mass) is expected to continue leading industry growth, with a competitive marketing rebate environment likely to persist [1] - The company anticipates a stabilization in the marketing rebate environment in 2026, which may enhance reinvestment rates and positively impact EBITDA margins, suggesting a potential end to aggressive marketing competition [1] - The deployment of side betting products, modeled after MBS, is ongoing, but participation from Macau customers has been below expectations, potentially limiting structural growth in win rates [1] - Visitor numbers and customer plans during the Spring Festival are expected to remain strong [1] - Although property foot traffic has surpassed 2019 levels, the high-end mass segment has recovered to 117% of 4Q19 levels with a 6% quarter-on-quarter increase, while the regular mass segment has only recovered to 95% of 4Q19 levels, indicating a decline in per capita spending among regular mass customers [1] Earnings Forecast and Valuation - The company maintains its EBITDA forecasts for 2026 and 2027 largely unchanged [1] - The current stock price corresponds to 9 times the 2026 estimated EV/EBITDA [1] - The company maintains an outperform rating and a target price of HKD 23.80, which corresponds to 11 times the 2026 estimated EV/EBITDA, indicating a 26% upside from the current stock price [1]

Core Viewpoint - CICC maintains its EBITDA forecasts for Sands China (01928) for 2026 and 2027, with the current stock price corresponding to 9 times the 2026 estimated EV/EBITDA. The firm maintains an outperform rating and a target price of HKD 23.80, indicating a 26% upside from the current stock price [1]. Group 1: Financial Performance - Sands China reported a net revenue of USD 2.058 billion for 4Q25, a year-on-year increase of 16% and a quarter-on-quarter increase of 8%, recovering to 92% of 4Q19 levels. Adjusted property EBITDA was USD 608 million, up 6% year-on-year and 1% quarter-on-quarter, but fell short of the consensus estimate of USD 632 million [2]. Group 2: Market Share and Costs - The company achieved a higher gaming revenue market share of 24.5% in 4Q25, up from 23.7% in 3Q25, driven by membership programs and growth in other Asian customer segments. However, EBITDA was impacted by rising operational costs, including expenses related to events like the NBA China Games and increased employee compensation due to higher gaming table capacity [3]. - The high-end segment (VIP and premium mass) is expected to continue leading industry growth, with the marketing rebate environment anticipated to stabilize in 2026, potentially positively impacting EBITDA margins. The deployment of side-bet products is ongoing, but participation from Macau customers has been below expectations, which may limit structural growth in win rates [3]. - Despite property foot traffic exceeding 2019 levels, the premium mass segment has recovered to 117% of 4Q19 levels, showing a 6% quarter-on-quarter increase, while the mass market segment has only recovered to 95% of 4Q19 levels, indicating a decline in per capita spending in the mass market [3].

Core Viewpoint - CICC maintains its EBITDA forecasts for Sands China (01928) for 2026 and 2027, with the current stock price corresponding to 9x 2026e EV/EBITDA, and a target price of HKD 23.80, indicating a 26% upside potential from the current price [1] Group 1: Financial Performance - Sands China reported 4Q25 net revenue of USD 2.058 billion, a year-on-year increase of 16% and a quarter-on-quarter increase of 8%, recovering to 92% of 4Q19 levels [2] - Adjusted property EBITDA for 4Q25 was USD 608 million, up 6% year-on-year and 1% quarter-on-quarter, but fell short of the consensus estimate of USD 632 million [2] Group 2: Market Share and Costs - The company achieved a higher gaming revenue market share of 24.5% in 4Q25, up from 23.7% in 3Q25, driven by membership programs and growth in customers from other Asian regions [3] - Despite the increased market share, EBITDA was impacted by higher operational costs, including expenses related to events like the NBA China Games and rising employee salaries due to increased gaming table capacity [3] Group 3: Industry Outlook - The high-end segment (VIP business and premium mass) is expected to continue leading industry growth, with the marketing rebate environment anticipated to stabilize in 2026, potentially positively impacting EBITDA margins [4] - The deployment of side-bet products is ongoing, but participation from Macau customers has not met expectations, which may limit structural growth in win rates; visitor numbers and customer plans during the Spring Festival are expected to remain strong [4] - Although property foot traffic has surpassed 2019 levels, the premium mass segment has recovered to 117% of 4Q19 levels, while the mass market segment has only recovered to 95%, indicating a decline in per capita spending in the mass segment [4]