LAS VEGAS SANDS CORP - Quarter Report: 2011 September (Form 10-Q)

Form 10-Q

UNITED STATES SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2011


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-32373

LAS VEGAS SANDS CORP.

(Exact name of registration as specified in its charter)


Nevada (State or other jurisdiction of incorporation or organization)		27-0099920 (I.R.S. Employer Identification No.)

3355 Las Vegas Boulevard South		89109
Las Vegas, Nevada		(Zip Code)
(Address of principal executive offices)

(702) 414-1000
(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer þ		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date.


Class		Outstanding at November 1, 2011

Common Stock ($0.001 par value)		732,718,517 shares

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

Table of Contents


PART I FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

Condensed Consolidated Balance Sheets at September 30, 2011 and December 31, 2010			3

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2011 and 2010			4

Condensed Consolidated Statements of Equity and Comprehensive Income for the Nine Months Ended September 30, 2011 and 2010			5

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2011 and 2010			6

Notes to Condensed Consolidated Financial Statements			8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			35

Item 3. Quantitative and Qualitative Disclosures about Market Risk			55

Item 4. Controls and Procedures			56

PART II OTHER INFORMATION

Item 1. Legal Proceedings			56

Item 1A. Risk Factors			56

Item 6. Exhibits			57

Signatures			58

Exhibit 10.1
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT


ITEM 1		*— FINANCIAL STATEMENTS*

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets


	September 30,		December 31,
	2011		2010
	(In thousands, except share and
	per share data)
	(Unaudited)
ASSETS

Current assets:
Cash and cash equivalents	$	3,951,575	$	3,037,081
Restricted cash and cash equivalents		184,366		164,315
Accounts receivable, net		1,112,896		716,919
Inventories		33,462		32,260
Deferred income taxes, net		9,664		61,606
Prepaid expenses and other		50,693		46,726

Total current assets		5,342,656		4,058,907
Property and equipment, net		14,804,973		14,502,197
Deferred financing costs, net		126,419		155,378
Restricted cash and cash equivalents		35,510		645,605
Deferred income taxes, net		14,361		10,423
Leasehold interests in land, net		1,382,539		1,398,840
Intangible assets, net		82,546		89,805
Other assets, net		176,247		183,153

Total assets	$	21,965,251	$	21,044,308

LIABILITIES AND EQUITY

Current liabilities:
Accounts payable	$	103,319	$	113,505
Construction payables		355,686		516,981
Accrued interest payable		19,318		42,625
Other accrued liabilities		1,318,857		1,160,234
Income taxes payable		78,447		—
Current maturities of long-term debt		457,344		767,068

Total current liabilities		2,332,971		2,600,413
Other long-term liabilities		81,950		78,240
Deferred income taxes		134,928		115,219
Deferred proceeds from sale of The Shoppes at The Palazzo		266,585		243,928
Deferred gain on sale of The Grand Canal Shoppes		48,210		50,808
Deferred rent from mall transactions		120,285		147,378
Long-term debt		9,282,084		9,373,755

Total liabilities		12,267,013		12,609,741

Preferred stock, $0.001 par value, issued to Principal Stockholder’s family, 5,250,000 shares issued and outstanding, after allocation of fair value of attached warrants, aggregate redemption/liquidation value of $577,500		572,787		503,379
Commitments and contingencies (Note 9)
Equity:
Preferred stock, $0.001 par value, 50,000,000 shares authorized, 1,871,794 and 3,614,923 shares issued and outstanding with warrants to purchase up to 1,694,503 and 22,663,212 shares of common stock		107,368		207,356
Common stock, $0.001 par value, 1,000,000,000 shares authorized, 731,668,681 and 707,507,982 shares issued and outstanding		732		708
Capital in excess of par value		5,587,892		5,444,705
Accumulated other comprehensive income		103,067		129,519
Retained earnings		1,830,097		880,703

Total Las Vegas Sands Corp. stockholders’ equity		7,629,156		6,662,991
Noncontrolling interests		1,496,295		1,268,197

Total equity		9,125,451		7,931,188

Total liabilities and equity	$	21,965,251	$	21,044,308

The accompanying notes are an integral part of these condensed consolidated financial statements.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
	(In thousands, except share and per share data)
	(Unaudited)
Revenues:
Casino	$	1,903,142		$	1,573,851		$	5,429,903		$	3,929,922
Rooms		262,352			208,160			734,022			579,709
Food and beverage		147,223			117,186			438,632			314,344
Convention, retail and other		223,841			147,179			589,138			370,660

		2,536,558			2,046,376			7,191,695			5,194,635
Less-promotional allowances		(127,183	)		(137,604	)		(325,305	)		(356,499	)

Net revenues		2,409,375			1,908,772			6,866,390			4,838,136

Operating expenses:
Casino		993,378			882,178			2,889,327			2,367,760
Rooms		53,493			36,866			152,679			100,593
Food and beverage		71,781			50,906			216,619			143,007
Convention, retail and other		99,229			70,603			291,498			194,333
Provision for doubtful accounts		33,953			37,833			92,507			72,986
General and administrative		240,672			193,476			674,718			492,654
Corporate expense		54,031			28,686			133,983			78,116
Rental expense		10,143			9,186			33,333			30,690
Pre-opening expense		15,823			10,107			43,472			97,684
Development expense		3,308			425			6,301			1,258
Depreciation and amortization		200,071			186,738			596,469			510,521
Impairment loss		—			16,057			—			16,057
Loss on disposal of assets		937			2,406			8,879			40,577

		1,776,819			1,525,467			5,139,785			4,146,236

Operating income		632,556			383,305			1,726,605			691,900
Other income (expense):
Interest income		2,369			2,661			8,444			6,367
Interest expense, net of amounts capitalized		(70,761	)		(76,723	)		(214,938	)		(231,875	)
Other income (expense)		(6,617	)		6,444			(9,384	)		(6,205	)
Loss on modification or early retirement of debt		—			(21,692	)		—			(18,555	)

Income before income taxes		557,547			293,995			1,510,727			441,632
Income tax expense		(52,375	)		(25,161	)		(151,960	)		(46,436	)

Net income		505,172			268,834			1,358,767			395,196
Net income attributable to noncontrolling interests		(80,293	)		(54,337	)		(233,928	)		(121,311	)

Net income attributable to Las Vegas Sands Corp.		424,879			214,497			1,124,839			273,885
Preferred stock dividends		(19,140	)		(23,350	)		(57,957	)		(70,050	)
Accretion to redemption value of preferred stock issued to Principal Stockholder’s family		(23,136	)		(23,136	)		(69,408	)		(69,408	)
Preferred stock inducement and repurchase premiums		(28,972	)		—			(48,080	)		—

Net income attributable to common stockholders	$	353,631		$	168,011		$	949,394		$	134,427

Basic earnings per share	$	0.48		$	0.25		$	1.31		$	0.20

Diluted earnings per share	$	0.44		$	0.21		$	1.17		$	0.17

Weighted average shares outstanding:
Basic		729,773,246			660,836,841			727,309,255			660,495,783

Diluted		812,543,534			789,156,247			811,550,683			782,156,007

The accompanying notes are an integral part of these condensed consolidated financial statements.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

Condensed Consolidated Statements of Equity and Comprehensive Income


	Las Vegas Sands Corp. Stockholders’ Equity
									Accumulated
						Capital in			Other						Total
	Preferred			Common		Excess of			Comprehensive			Retained			Comprehensive			Noncontrolling
	Stock			Stock		Par Value			Income			Earnings			Income			Interests			Total
	(In thousands)
	(Unaudited)
Balance at January 1, 2010	$	234,607		$	660	$	5,114,851		$	26,748		$	473,833					$	1,089,888		$	6,940,587
Net income		—			—		—			—			273,885			273,885			121,311			395,196
Currency translation adjustment		—			—		—			74,871			—			74,871			(481	)		74,390

Total comprehensive income																348,756			120,830			469,586
Exercise of stock options		—			1		6,395			—			—						—			6,396
Tax shortfall from stock-based compensation		—			—		(195	)		—			—						—			(195	)
Stock-based compensation		—			—		42,674			—			—						2,065			44,739
Exercise of warrants		(4	)		—		9			—			—						—			5
Deemed contribution from Principal Stockholder		—			—		317			—			—						—			317
Acquisition of remaining shares of noncontrolling interest		—			—		2,345			—			—						(2,345	)		—
Dividends declared, net of amounts previously accrued		—			—		—			—			(63,196	)					—			(63,196	)
Accumulated but undeclared dividend requirement on preferred stock issued to Principal Stockholder’s family		—			—		—			—			(6,854	)					—			(6,854	)
Accretion to redemption value of preferred stock issued to Principal Stockholder’s family		—			—		—			—			(69,408	)					—			(69,408	)

Balance at September 30, 2010	$	234,603		$	661	$	5,166,396		$	101,619		$	608,260					$	1,210,438		$	7,321,977

Balance at January 1, 2011	$	207,356		$	708	$	5,444,705		$	129,519		$	880,703					$	1,268,197		$	7,931,188
Net income		—			—		—			—			1,124,839			1,124,839			233,928			1,358,767
Currency translation adjustment		—			—		—			(26,452	)		—			(26,452	)		(2,192	)		(28,644	)

Total comprehensive income																1,098,387			231,736			1,330,123
Exercise of stock options		—			2		21,270			—			—						1,140			22,412
Tax shortfall from stock-based compensation		—			—		(83	)		—			—						—			(83	)
Stock-based compensation		—			—		45,735			—			—						2,199			47,934
Issuance of restricted stock		—			1		(1	)		—			—						—			—
Exercise of warrants		(66,625	)		21		76,266			—			—						—			9,662
Repurchase of preferred stock		(33,363	)		—		—			—			(31,586	)					—			(64,949	)
Disposition of interest in majority owned subsidiary		—			—		—			—			—						829			829
Distributions to noncontrolling interests		—			—		—			—			—						(7,806	)		(7,806	)
Dividends declared, net of amounts previously accrued		—			—		—			—			(51,103	)					—			(51,103	)
Accumulated but undeclared dividend requirement on preferred stock issued to Principal Stockholder’s family		—			—		—			—			(6,854	)					—			(6,854	)
Accretion to redemption value of preferred stock issued to Principal Stockholder’s family		—			—		—			—			(69,408	)					—			(69,408	)
Preferred stock inducement premium		—			—		—			—			(16,494	)					—			(16,494	)

Balance at September 30, 2011	$	107,368		$	732	$	5,587,892		$	103,067		$	1,830,097					$	1,496,295		$	9,125,451

The accompanying notes are an integral part of these condensed consolidated financial statements.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows


	Nine Months Ended
	September 30,
	2011			2010
	(In thousands)
	(Unaudited)
Cash flow from operating activities:
Net income	$	1,358,767		$	395,196
Adjustments to reconcile net income to net cash generated from operating activities:
Depreciation and amortization		596,469			510,521
Amortization of leasehold interests in land included in rental expense		33,333			30,690
Amortization of deferred financing costs and original issue discount		35,059			29,885
Amortization of deferred gain and rent		(7,182	)		(3,870	)
Non-cash change in deferred proceeds from sale of The Shoppes at The Palazzo		754			—
Loss on modification or early retirement of debt		—			3,756
Impairment and loss on disposal of assets		8,879			56,634
Stock-based compensation expense		47,242			42,552
Provision for doubtful accounts		92,507			72,986
Foreign exchange losses		3,013			1,183
Deferred income taxes		69,219			58,042
Non-cash contribution from Principal Stockholder included in corporate expense		—			317
Changes in operating assets and liabilities:
Accounts receivable		(502,848	)		(219,592	)
Inventories		(1,287	)		(479	)
Prepaid expenses and other		1,628			(6,371	)
Leasehold interests in land		(22,980	)		(17,199	)
Accounts payable		(10,217	)		16,912
Accrued interest payable		(23,319	)		(3,920	)
Income taxes payable		80,497			8,052
Other accrued liabilities		169,639			232,703

Net cash generated from operating activities		1,929,173			1,207,998

Cash flows from investing activities:
Changes in restricted cash and cash equivalents		590,096			(836,805	)
Capital expenditures		(1,087,605	)		(1,650,264	)
Proceeds from disposal of property and equipment		5,487			5,951
Acquisition of intangible assets		(100	)		(44,599	)
Purchases of investments		—			(173,774	)
Proceeds from investments		—			173,774

Net cash used in investing activities		(492,122	)		(2,525,717	)

Cash flows from financing activities:
Proceeds from exercise of stock options		22,412			6,396
Proceeds from exercise of warrants		9,662			5
Dividends paid to preferred stockholders		(57,957	)		(70,050	)
Distributions to noncontrolling interests		(7,806	)		—
Proceeds from long-term debt (Note 3)		—			1,399,157
Repayments on long-term debt (Note 3)		(399,403	)		(2,524,602	)
Repurchase of preferred stock		(64,949	)		—
Payments of preferred stock inducement premium		(16,494	)		—
Payments of deferred financing costs		(6,076	)		(65,823	)

Net cash used in financing activities		(520,611	)		(1,254,917	)

Effect of exchange rate on cash		(1,946	)		11,932

Increase (decrease) in cash and cash equivalents		914,494			(2,560,704	)
Cash and cash equivalents at beginning of period		3,037,081			4,955,416

Cash and cash equivalents at end of period	$	3,951,575		$	2,394,712


	Nine Months Ended
	September 30,
	2011			2010
	(In thousands)
	(Unaudited)
Supplemental disclosure of cash flow information:
Cash payments for interest, net of amounts capitalized	$	203,183		$	205,343

Cash payments for taxes, net of refunds	$	(5,582	)	$	175

Changes in construction payables	$	(161,295	)	$	(207,574	)

Non-cash investing and financing activities:
Capitalized stock-based compensation costs	$	692		$	2,187

Property and equipment acquired under capital lease	$	—		$	3,549

Accumulated but undeclared dividend requirement on preferred stock issued to Principal Stockholder’s family	$	6,854		$	6,854

Accretion to redemption value of preferred stock issued to Principal Stockholder’s family	$	69,408		$	69,408

Acquisition of remaining shares of noncontrolling interest	$	—		$	2,345

Disposition of interest in majority owned subsidiary	$	829		$	—

Warrants exercised and settled through tendering of preferred stock	$	66,625		$	4

The accompanying notes are an integral part of these condensed consolidated financial statements.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 — ORGANIZATION AND BUSINESS OF COMPANY

The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K of Las Vegas Sands Corp. (“LVSC”), a Nevada corporation, and its subsidiaries (collectively the “Company”) for the year ended December 31, 2010. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, all adjustments and normal recurring accruals considered necessary for a fair statement of the results for the interim period have been included. The interim results reflected in the unaudited condensed consolidated financial statements are not necessarily indicative of expected results for the full year. The Company’s common stock is traded on the New York Stock Exchange under the symbol “LVS.”

In November 2009, the Company’s subsidiary, Sands China Ltd. (“SCL,” the indirect owner and operator of the majority of the Company’s operations in the Macau Special Administrative Region (“Macau”) of the People’s Republic of China), completed an initial public offering by listing its ordinary shares (the “SCL Offering”) on The Main Board of The Stock Exchange of Hong Kong Limited (“SEHK”). Immediately following the SCL Offering and several transactions consummated in connection with such offering, the Company owned 70.3% of the issued and outstanding ordinary shares of SCL. The shares of SCL were not, and will not, be registered under the Securities Act of 1933, as amended, and may not be offered or sold in the U.S. absent a registration under the Securities Act of 1933, as amended, or an applicable exception from such registration requirements.

Operations

United States

Las Vegas

The Company owns and operates The Venetian Resort Hotel Casino (“The Venetian Las Vegas”), a Renaissance Venice-themed resort; The Palazzo Resort Hotel Casino (“The Palazzo”), a resort featuring modern European ambience and design; and an expo and convention center of approximately 1.2 million square feet (the “Sands Expo Center”). These Las Vegas properties, situated on or near the Las Vegas Strip, form an integrated resort with approximately 7,100 suites; approximately 225,000 square feet of gaming space; a meeting and conference facility of approximately 1.1 million square feet; an enclosed retail, dining and entertainment complex located within The Venetian Las Vegas of approximately 440,000 net leasable square feet (“The Grand Canal Shoppes”), which was sold to GGP Limited Partnership (“GGP”) in 2004; and an enclosed retail and dining complex located within The Palazzo of approximately 400,000 net leasable square feet (“The Shoppes at The Palazzo”), which was sold to GGP in February 2008. See “— Note 2 — Property and Equipment, Net” regarding the sale of The Shoppes at The Palazzo.

Pennsylvania

In May 2009, the Company partially opened Sands Casino Resort Bethlehem (the “Sands Bethlehem”), a gaming, hotel, retail and dining complex located on the site of the historic Bethlehem Steel Works in Bethlehem, Pennsylvania. Sands Bethlehem currently features approximately 152,000 square feet of gaming space, which include table games operations that commenced in July 2010; a 300-room hotel tower, which opened in May 2011; an arts and cultural center; and the broadcast home of the local PBS affiliate. The Company has initiated construction activities on the remaining components of the integrated resort, which include a 150,000-square-foot retail facility (with a progressive opening beginning in November 2011) and a 50,000-square-foot multipurpose event center (expected to open in the second quarter of 2012). Sands Bethlehem is also expected to be home to the National Museum of Industrial History. The Company owns 86% of the economic interest of the gaming, hotel and entertainment portion of the property through its ownership interest in Sands Bethworks Gaming LLC and more than 35% of the economic interest of the retail portion of the property through its ownership interest in Sands Bethworks Retail LLC. As of September 30, 2011, the Company has capitalized construction costs of $695.2 million for this project (including $6.6 million in outstanding construction payables). The Company expects to spend approximately $30 million to complete construction of the project, on furniture, fixtures and equipment (“FF&E”) and other costs, and to pay outstanding construction payables, as noted above.

Macau

The Company currently owns 70.3% of SCL, which includes the operations of the Sands Macao, The Venetian Macao, Four Seasons Macao and other ancillary operations that support these properties, as further discussed below. The Company operates the gaming areas within these properties pursuant to a 20-year gaming subconcession.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

The Company owns and operates the Sands Macao, the first Las Vegas-style casino in Macau. The Sands Macao offers approximately 197,000 square feet of gaming space and a 289-suite hotel tower, as well as several restaurants, VIP facilities, a theater and other high-end services and amenities.

The Company also owns and operates The Venetian Macao Resort Hotel (“The Venetian Macao”), which anchors the Cotai Strip^™, the Company’s master-planned development of integrated resort properties in Macau. With a theme similar to that of The Venetian Las Vegas, The Venetian Macao includes a 39-floor luxury hotel with over 2,900 suites; approximately 550,000 square feet of gaming space; a 15,000-seat arena; an 1,800-seat theater; retail and dining space of approximately 1.0 million square feet; and a convention center and meeting room complex of approximately 1.2 million square feet.

The Company owns the Four Seasons Hotel Macao, Cotai Strip^™ (the “Four Seasons Hotel Macao”), which features 360 rooms and suites managed and operated by Four Seasons Hotels Inc. and is located adjacent and connected to The Venetian Macao. Connected to the Four Seasons Hotel Macao, the Company owns and operates the Plaza Casino (together with the Four Seasons Hotel Macao, the “Four Seasons Macao”), which features approximately 70,000 square feet of gaming space; 19 Paiza mansions; retail space of approximately 211,000 square feet, which is connected to the mall at The Venetian Macao; several food and beverage offerings; and conference, banquet and other facilities. This integrated resort will also feature the Four Seasons Apartment Hotel Macao, Cotai Strip^™ (the “Four Seasons Apartments”), an apart-hotel tower that consists of approximately 1.0 million square feet of Four Seasons-serviced and -branded luxury apart-hotel units and common areas. The Company has completed the structural work of the tower and expects to subsequently monetize units within the Four Seasons Apartments subject to market conditions and obtaining the necessary government approvals. As of September 30, 2011, the Company has capitalized $1.15 billion for the property, including the land premium (net of amortization) and $7.9 million in outstanding construction payables. The Company expects to spend approximately $105 million primarily on additional costs to complete the Four Seasons Apartments, including FF&E and pre-opening costs, and to pay outstanding construction payables, as noted above.

Singapore

The Company owns and operates the Marina Bay Sands in Singapore, which partially opened on April 27, 2010, with additional portions opened progressively throughout 2010. The Marina Bay Sands features three 55-story hotel towers (totaling approximately 2,600 rooms and suites), the Sands SkyPark^™ (which sits atop the hotel towers and features an infinity swimming pool and several dining options), approximately 160,000 square feet of gaming space, an enclosed retail, dining and entertainment complex of approximately 800,000 net leasable square feet, a convention center and meeting room complex of approximately 1.2 million square feet and theaters. In February 2011, the Marina Bay Sands opened a landmark iconic structure at the bay-front promenade that contains an art/science museum. As of September 30, 2011, the Company has capitalized 7.66 billion Singapore dollars (“SGD,” approximately $5.91 billion at exchange rates in effect on September 30, 2011) in costs for this project, including the land premium and SGD 190.5 million (approximately $147.1 million at exchange rates in effect on September 30, 2011) in outstanding construction payables. The Company expects to spend approximately SGD 475 million (approximately $367 million at exchange rates in effect on September 30, 2011) on construction-related costs, FF&E and other costs, and to pay outstanding construction payables, as noted above. As the Company has obtained Singapore-denominated financing and primarily pays its costs in Singapore dollars, its exposure to foreign exchange gains and losses is expected to be minimal.

Development Projects

The Company has suspended portions of its development projects to focus its efforts on those projects with the highest expected rates of return on invested capital. Should general economic conditions fail to improve, if the Company is unable to obtain sufficient funding or applicable government approvals such that completion of its suspended projects is not probable, or should management decide to abandon certain projects, all or a portion of the Company’s investment to date on its suspended projects could be lost and would result in an impairment charge. In addition, the Company may be subject to penalties under the termination clauses in its construction contracts or termination rights under its management contracts with certain hotel management companies.

United States

The Company was constructing a high-rise residential condominium tower (the “Las Vegas Condo Tower”), located on the Las Vegas Strip between The Palazzo and The Venetian Las Vegas. The Company suspended construction activities for the project due to reduced demand for Las Vegas Strip condominiums and the overall decline in general economic conditions. The Company intends to recommence construction when demand and conditions improve and expects that it will take approximately 18 months thereafter to complete construction of the project. As of September 30, 2011, the Company has capitalized construction costs of $178.0 million for this project. The impact of the suspension on the estimated overall cost of the project is currently not determinable with certainty.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Macau

The Company submitted plans to the Macau government for its other Cotai Strip developments, which represent three integrated resort developments, in addition to The Venetian Macao and Four Seasons Macao, on an area of approximately 200 acres (which are referred to as Sands Cotai Central (formerly parcels 5 and 6) and parcels 3 and 7 and 8). Subject to the approval from the Macau government, as discussed further below, the developments are expected to include hotels, exhibition and conference facilities, gaming areas, showrooms, shopping malls, spas, restaurants, entertainment facilities and other amenities. The Company had commenced construction or pre-construction activities on these developments and plans to operate the related gaming areas under the Company’s Macau gaming subconcession.

The Company is staging the construction of its Sands Cotai Central integrated resort development. Upon completion of phases I and II of the project, the integrated resort is expected to feature approximately 5,800 hotel rooms, approximately 300,000 square feet of gaming space, approximately 1.2 million square feet of retail, entertainment, dining and exhibition and conference facilities, and a multipurpose theater. Phase I, which is currently expected to open at the end of the first quarter of 2012, includes a hotel tower on parcel 5 that was to be managed by Shangri-La International Hotel Management Limited (“Shangri-La”); however, in March 2011, the Company and Shangri-La mutually agreed to terminate the hotel management agreement. The hotel tower will now be managed by Hilton Worldwide, which will include 600 five-star rooms and suites under their Conrad brand, and InterContinental Hotels Group, which will include 1,200 four-star rooms and suites under the Holiday Inn brand. Phase I also includes completion of the structural work of an adjacent hotel tower, located on parcel 6, to be managed by Sheraton International Inc. and Sheraton Overseas Management Co. (collectively “Starwood”) under its Sheraton Towers brand, a variety of retail offerings, more than 300,000 square feet of meeting space, several food and beverage establishments, along with the 106,000 square foot casino and VIP gaming areas. Phase IIA, which is currently scheduled to open in the third quarter of 2012, includes the opening of the first hotel tower on parcel 6, which will feature nearly 2,000 Sheraton-branded rooms, along with the second casino and the remaining dining, entertainment, retail and meeting facilities. Phase IIB, which is projected to open in the first quarter of 2013, consists of the second hotel tower on parcel 6 and will feature an additional 2,000 rooms and suites under the Sheraton Towers brand. The total cost to complete phases I and II is expected to be approximately $1.6 billion. Phase III of the project is expected to include a fourth hotel and mixed-use tower, located on parcel 5, to be managed by Starwood under its St. Regis brand and the total cost is expected to be approximately $450 million. The Company intends to commence construction of phase III of the project as demand and market conditions warrant it. As of September 30, 2011, the Company has capitalized costs of $2.73 billion for the entire project, including the land premium (net of amortization) and $183.9 million in outstanding construction payables. The Company’s management agreement with Starwood imposes certain construction deadlines and opening obligations on the Company and certain past and/or anticipated delays, as described above, would allow Starwood to terminate its agreement. See "— Note 9 — Commitments and Contingencies — Other Agreements.” The Company is currently negotiating an amendment to the management agreement with Starwood to provide for new opening timelines.

The Company had commenced pre-construction activities on parcels 7 and 8 and 3, and has capitalized costs of $100.7 million for parcels 7 and 8 and $96.2 million for parcel 3 (including the land premium, net of amortization) as of September 30, 2011. The Company intends to commence construction after Sands Cotai Central is complete, necessary government approvals are obtained (including the land concession, see below), regional and global economic conditions improve, future demand warrants it and additional financing is obtained.

The impact of the delayed construction on the Company’s previously estimated cost to complete its Cotai Strip developments is currently not determinable. As of September 30, 2011, the Company has capitalized an aggregate of $7.11 billion in construction costs and land premiums (net of amortization) for its Cotai Strip developments, including The Venetian Macao, Four Seasons Macao and Sands Cotai Central, as well as the Company’s investments in transportation infrastructure, including its passenger ferry service operations. In addition to funding phases I and II of Sands Cotai Central with borrowings under the Company’s new $3.7 billion Macau credit facility entered into in September 2011 (the “2011 VML Credit Facility,” as discussed further below), the Company will need to arrange additional financing to fund the balance of its Cotai Strip developments and there is no assurance that the Company will be able to obtain any of the additional financing required.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Land concessions in Macau generally have an initial term of 25 years with automatic extensions of 10 years thereafter in accordance with Macau law. The Company has received land concessions from the Macau government to build on parcels 1, 2, 3 and 5 and 6, including the sites on which The Venetian Macao (parcel 1), the Four Seasons Macao (parcel 2) and Sands Cotai Central (parcels 5 and 6) are located. The Company does not own these land sites in Macau; however, the land concessions grant the Company exclusive use of the land. As specified in the land concessions, the Company is required to pay premiums for each parcel, which are either payable in a single lump sum upon acceptance of the land concessions by the Macau government or in seven semi-annual installments (provided that the outstanding balance is due upon the completion of the corresponding integrated resort), as well as annual rent for the term of the land concessions. In December 2010, the Company received notice from the Macau government that its application for a land concession for parcels 7 and 8 was not approved and the Company applied to the Chief Executive of Macau for a review of the decision. In January 2011, the Company filed an appeal with the Court of Second Instance in Macau, which has yet to issue a decision. Should the Company win its appeal, it is still possible for the Chief Executive of Macau to again deny the land concession based upon public policy considerations. If the Company does not obtain the land concession or does not receive full reimbursement of its capitalized investment in this project, the Company would record a charge for all or some portion of the $100.7 million in capitalized construction costs, as of September 30, 2011, related to its development on parcels 7 and 8.

Under the Company’s land concession for parcel 3, the Company was initially required to complete the corresponding development by August 2011. The Macau government has granted the Company a two-year extension to complete the development of parcel 3, which now must be completed by April 2013. The land concession for Sands Cotai Central contains a similar requirement that the corresponding development be completed by May 2014. The Company believes that if it is not able to complete the developments by the respective deadlines, it will likely be able to obtain extensions from the Macau government; however, no assurances can be given that additional extensions will be granted. If the Company is unable to meet the applicable deadlines and those deadlines are not extended, it could lose its land concessions for parcel 3 or Sands Cotai Central, which would prohibit the Company from operating any facilities developed under the respective land concessions. As a result, the Company could record a charge for all or some portion of its $96.2 million and $2.73 billion in capitalized construction costs and land premiums (net of amortization), as of September 30, 2011, related to its developments on parcel 3 or Sands Cotai Central, respectively.

Other

When the current economic environment and access to capital improve, the Company may continue exploring the possibility of developing and operating additional properties, including integrated resorts, in additional Asian and U.S. jurisdictions, and in Europe.

Development Financing Strategy

Through September 30, 2011, the Company has funded its development projects primarily through borrowings under its U.S., Macau and Singapore credit facilities, operating cash flows, proceeds from its equity offerings and proceeds from the disposition of non-core assets.

The U.S. credit facility, as amended in August 2010, requires the Company’s Las Vegas operations to comply with certain financial covenants at the end of each quarter, including maintaining a maximum leverage ratio of net debt, as defined, to trailing twelve-month adjusted earnings before interest, income taxes, depreciation and amortization, as defined (“Adjusted EBITDA”). The maximum leverage ratio is 6.0x for the quarterly periods ended September 30 and December 31, 2011, decreases to 5.5x for the quarterly periods ended March 31 and June 30, 2012, and then decreases to 5.0x for all quarterly periods thereafter through maturity. One of the Company’s Macau credit facilities, the VML credit facility, as amended in August 2009, requires certain of the Company’s Macau operations to comply with similar financial covenants, including maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 3.0x for the quarterly periods through maturity. The Company can elect to contribute up to $50 million and $20 million of cash on hand to its Las Vegas and relevant Macau operations, respectively, on a bi-quarterly basis; such contributions having the effect of increasing Adjusted EBITDA by the corresponding amount during the applicable quarter for purposes of calculating compliance with the maximum leverage ratio (the “EBITDA true-up”). The Singapore credit facility requires operations of Marina Bay Sands to comply with similar financial covenants, which commenced with the quarterly period ended September 30, 2011, including maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 5.5x for the quarterly period ended September 30, 2011, and then decreases by 0.25x every other quarter until September 30, 2014, when it decreases to, and remains at, 3.75x for all quarterly periods thereafter through maturity. The Company’s 2011 VML Credit Facility, entered into in September 2011, will also require the Company’s Macau operations to comply with similar financial covenants commencing with the quarterly period ended March 31, 2012, including maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio will be 4.5x for the quarterly periods ended March 31, 2012 through June 30, 2013, decreases to 4.0x for the quarterly periods ended September 30, 2013 through December 31, 2014, decreases to 3.5x for the quarterly periods ended March 31 through December 31, 2015, and then decreases and remains at 3.0x for all quarterly periods thereafter through maturity. If the Company is unable to maintain compliance with the financial covenants under these credit facilities, it would be in default under the respective credit facilities. A default under the U.S. credit facility would trigger a cross-default under the Company’s airplane financings, which, if the respective lenders chose to accelerate the indebtedness outstanding under these agreements, would result in a default under the Company’s senior notes. Certain defaults under the VML credit facility would trigger a cross-default under the Company’s ferry financing. Any defaults or cross-defaults under these agreements would allow the lenders, in each case, to exercise their rights and remedies as defined under their respective agreements. If the lenders were to exercise their rights to accelerate the due dates of the indebtedness outstanding, there can be no assurance that the Company would be able to repay or refinance any amounts that may become due and payable under such agreements, which could force the Company to restructure or alter its operations or debt obligations.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

In 2008, the Company completed a $475.0 million convertible senior notes offering and a $2.1 billion common and preferred stock and warrants offering. In 2009, the Company completed a $600.0 million exchangeable bond offering and its $2.5 billion SCL Offering. A portion of the proceeds from these offerings was used in the U.S. to pay down $775.9 million under the revolving portion of the U.S. credit facility in March 2010 and $1.0 billion under the term loan portions of the U.S. credit facility in August 2010, and to exercise the EBITDA true-up provision during the quarterly period ended March 31, 2011.

The Company held unrestricted and restricted cash and cash equivalents of approximately $3.95 billion and $219.9 million, respectively, as of September 30, 2011. The Company believes the cash on hand, cash flow generated from operations and available borrowings under its credit facilities will be sufficient to fund its developments currently under construction and maintain compliance with the financial covenants of its U.S., Macau and Singapore credit facilities. In the normal course of its activities, the Company will continue to evaluate its capital structure and opportunities for enhancements thereof. The Company recommenced construction activities at Sands Cotai Central in May 2010 using the proceeds from the $1.75 billion VOL credit facility together with $500.0 million of proceeds from the SCL Offering. In September 2011, the Company entered into the $3.7 billion 2011 VML Credit Facility, which, upon funding that is expected to occur in November 2011, will be used to repay the outstanding indebtedness under the VML and VOL credit facilities, as well as continue to fund the development, construction and completion of certain components of Sands Cotai Central. See “— Note 3 — Long-Term Debt — 2011 VML Credit Facility” for further disclosure.

Recent Accounting Pronouncements

In January 2010, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance for fair value measurements, which requires new disclosures regarding significant transfers in and out of Level 1 and 2 fair value measurements and gross presentation of activity within the reconciliation for Level 3 fair value measurements. The guidance also clarifies existing requirements on the level of disaggregation and required disclosures regarding inputs and valuation techniques for both recurring and nonrecurring Level 2 and 3 fair value measurements. The guidance is effective for interim and annual reporting periods beginning after December 15, 2009, with the exception of gross presentation of Level 3 activity, which is effective for interim and annual reporting periods beginning after December 15, 2010. The adoption of this guidance did not have a material effect on the Company’s financial condition, results of operations or cash flows. See “— Note 8 — Fair Value Measurements” for the required disclosure.

In May 2011, the FASB issued authoritative guidance that is intended to align the principles for fair value measurements and the related disclosure requirements under GAAP and international financial reporting standards. The guidance is effective for interim and annual reporting periods beginning on or after December 15, 2011. The adoption of this guidance will not have a material effect on the Company’s financial condition, results of operations or cash flows.

In June 2011, the FASB issued authoritative guidance that amends the presentation of comprehensive income in the financial statements by requiring an entity to present the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The update also eliminates the option to present the components of other comprehensive income as part of the statement of equity. The guidance is effective for interim and annual reporting periods beginning on or after December 15, 2011, with early adoption permitted. The adoption of this guidance will not have a material effect on the Company’s financial condition, results of operations or cash flows.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 2 — PROPERTY AND EQUIPMENT, NET

Property and equipment consists of the following (in thousands):


	September 30,			December 31,
	2011			2010
Land and improvements	$	431,941		$	410,758
Building and improvements		11,367,108			10,881,936
Furniture, fixtures, equipment and leasehold improvements		2,083,422			1,990,721
Transportation		405,738			402,904
Construction in progress		3,416,546			3,147,750

		17,704,755			16,834,069
Less — accumulated depreciation and amortization		(2,899,782	)		(2,331,872	)

	$	14,804,973		$	14,502,197

Construction in progress consists of the following (in thousands):


	September 30,		December 31,
	2011		2010
Sands Cotai Central	$	2,612,616	$	2,005,386
Four Seasons Macao (principally the Four Seasons Apartments)		387,572		379,161
Sands Bethlehem		59,421		101,960
Marina Bay Sands		21,872		337,835
Other		335,065		323,408

	$	3,416,546	$	3,147,750

The $335.1 million in other construction in progress consists primarily of construction of the Las Vegas Condo Tower and costs incurred at the Cotai Strip parcels 3 and 7 and 8.

The final purchase price for The Shoppes at The Palazzo was to be determined in accordance with the April 2004 purchase and sale agreement, as amended, between Venetian Casino Resort, LLC (“VCR”) and GGP (the “Amended Agreement”) based on net operating income (“NOI”) of The Shoppes at The Palazzo calculated 30 months after the closing date of the sale, as defined under the Amended Agreement (the “Final Purchase Price”) and subject to certain later audit adjustments. The Company and GGP had entered into several amendments to the Amended Agreement to defer the time to reach agreement on the Final Purchase Price as both parties continued to work on various matters related to the calculation of NOI. On June 24, 2011, the Company reached a settlement with GGP regarding the Final Purchase Price. Under the terms of the settlement, the Company retained the $295.4 million of proceeds previously received and participates in certain future revenues earned by GGP. Under generally accepted accounting principles, the transaction has not been accounted for as a sale because the Company’s participation in certain future revenues constitutes continuing involvement in The Shoppes at The Palazzo. Therefore, $266.2 million of the proceeds allocated to the mall sale transaction has been recorded as deferred proceeds (a long-term financing obligation), which will accrue interest at an imputed rate and will be offset by (i) imputed rental income and (ii) rent payments made to GGP related to spaces leased back from GGP by the Company. The property and equipment legally sold to GGP totaling $267.5 million (net of $43.9 million of accumulated depreciation) as of September 30, 2011, will continue to be recorded on the Company’s condensed consolidated balance sheet and will continue to be depreciated in the Company’s condensed consolidated income statement.

During the three and nine months ended September 30, 2011 and the three and nine months ended September 30, 2010, the Company capitalized interest expense of $34.9 million, $97.3 million, $32.0 million and $74.3 million, respectively. During the three and nine months ended September 30, 2011 and the three and nine months ended September 30, 2010, the Company capitalized approximately $3.8 million, $20.8 million, $13.3 million and $43.4 million, respectively, of internal costs, consisting primarily of compensation expense for individuals directly involved with the development and construction of property and equipment.

The Company suspended portions of its development projects. As described in “— Note 1 — Organization and Business of Company — Development Projects,” the Company may be required to record an impairment charge related to these developments in the future.

The Company had commenced pre-construction activities on parcels 7 and 8, and has capitalized construction costs of $100.7 million as of September 30, 2011. During December 2010, the Company received notice from the Macau government that its application for a land concession for parcels 7 and 8 was not approved and the Company applied to the Chief Executive of Macau for a review of the decision. In January 2011, the Company filed an appeal with the Court of Second Instance in Macau, which has yet to issue a decision. Should the Company win its appeal, it is still possible for the Chief Executive of Macau to again deny the land concession based upon public policy considerations. In order to obtain the land concession and construct the resort, the Company would need to win its appeal and avoid any future denial of the land concession based upon public policy considerations. If the Company does not obtain the land concession or does not receive full reimbursement of its capitalized investment in this project, the Company would record a charge for all or some portion of the $100.7 million in capitalized construction costs, as of September 30, 2011, related to its development on parcels 7 and 8.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 3 — LONG-TERM DEBT

Long-term debt consists of the following (in thousands):


	September 30,			December 31,
Corporate and U.S. Related:	2011			2010
Senior Secured Credit Facility — Term B	$	2,140,928		$	2,157,199
Senior Secured Credit Facility — Delayed Draws I and II		714,900			720,332
6.375% Senior Notes (net of original issue discount of $591 and $720, respectively)		189,121			188,992
Airplane Financings		75,656			78,422
HVAC Equipment Lease		21,745			23,006
Other		3,185			3,868
Macau Related:
VML Credit Facility — Term B		1,452,289			1,483,789
VML Credit Facility — Term B Delayed		564,779			577,029
VOL Credit Facility — Term		749,447			749,930
Ferry Financing		148,549			175,011
Other		392			640
Singapore Related:
Singapore Credit Facility		3,676,807			3,980,435
Other		1,630			2,170

		9,739,428			10,140,823
Less — current maturities		(457,344	)		(767,068	)

Total long-term debt	$	9,282,084		$	9,373,755

Senior Secured Credit Facility

As of September 30, 2011, the Company had $724.6 million of available borrowing capacity under the Senior Secured Credit Facility, net of outstanding letters of credit and undrawn amounts committed to be funded by Lehman Brothers Commercial Paper Inc.

VML Credit Facility

As of September 30, 2011, the Company has no available borrowing capacity under the VML Credit Facility.

VOL Credit Facility

As of September 30, 2011, the Company had $1.0 billion of available borrowing capacity under the VOL Credit Facility.

VML and VOL Credit Facilities Refinancing

The Company entered into the VML and VOL credit facilities to construct and develop its Cotai Strip integrated resort projects (including The Venetian Macao, Four Seasons Macao and Sands Cotai Central). In order to reduce the Company’s interest expense, extend the debt maturities and enhance the Company’s financial flexibility and further strengthen its financial position, the Company entered into a new Macau credit facility in September 2011, as further described below. Upon funding, a portion of the borrowings under the new facility will be used to repay outstanding indebtedness under the VML and VOL credit facilities, as well as for working capital requirements and general corporate purposes, including for the development, construction and completion of certain components of Sands Cotai Central. As the Company has the ability and intent to refinance the VML and VOL credit facilities, $618.8 million of debt has been reclassified from current to long-term on the condensed consolidated balance sheet as of September 30, 2011. The Company expects to record a charge of approximately $21.5 million for loss on modification or early retirement of debt during the three months ending December 31, 2011, upon closing the refinancing the VML and VOL credit facilities.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

2011 VML Credit Facility

On September 22, 2011, two subsidiaries of the Company, VML US Finance LLC (the “Borrower”) and Venetian Macau Limited (“VML”), as guarantor, entered into a credit agreement (the “2011 VML Credit Facility”), providing for up to $3.7 billion (or equivalent in Hong Kong dollars or Macau patacas), which consists of a $3.2 billion term loan (the “2011 VML Term Facility”) that may be drawn until November 29, 2011, and a $500.0 million revolving facility (the “2011 VML Revolving Facility”) that is available until one month prior to the fifth anniversary of the date of the initial funding of the loans under the 2011 VML Term Facility (the “Closing Date”). The Company expects to draw the full amount of the 2011 VML Term Facility prior to November 29, 2011.

The indebtedness under the 2011 VML Credit Facility will be guaranteed by VML, Venetian Cotai Limited, Venetian Orient Limited (“VOL,” owner and developer of Sands Cotai Central) and certain of the Company’s other foreign subsidiaries (collectively, the “2011 VML Guarantors”). The obligations under the 2011 VML Credit Facility are collateralized by a first-priority security interest in substantially all of the Borrower’s and the 2011 VML Guarantors’ assets, other than (1) capital stock and similar ownership interests, (2) certain furniture, fixtures, fittings and equipment and (3) certain other excluded assets.

The 2011 VML Credit Facility will mature on the fifth anniversary of the Closing Date. Commencing on December 31, 2014, and at the end of each subsequent quarter through September 30, 2015, the Borrower is required to repay the outstanding 2011 VML Term Facility on a pro rata basis in an amount equal to 6.25% of the aggregate principal amount outstanding as of the Closing Date. Commencing on December 31, 2015, and at the end of each subsequent quarter through June 30, 2016, the Borrower is required to repay the outstanding 2011 VML Term Facility on a pro rata basis in an amount equal to 10.0% of the aggregate principal amount outstanding as of the Closing Date. The remaining balance on the 2011 VML Term Facility and any balance on the 2011 VML Revolving Facility are due on the maturity date. In addition, the Borrower is required to further repay the outstanding 2011 VML Term Facility with a portion of its excess free cash flow (as defined by the 2011 VML Credit Facility) after the end of each year, unless the Borrower is in compliance with a specified consolidated leverage ratio (the “CLR”).

Borrowings under the 2011 VML Credit Facility bear interest at either the adjusted Eurodollar rate or an alternative base rate (in the case of U.S. dollar denominated loans) or Hong Kong Interbank Offer Rate (in the case of Hong Kong dollar and Macau pataca denominated loans), as applicable, plus a spread of 2.25% for the first 180 days after the Closing Date. Beginning 180 days after the Closing Date, the spread for all outstanding loans is subject to reduction based on the CLR. The Borrower will also pay standby fees of 0.5% per annum on the undrawn amounts under the 2011 VML Revolving Facility (which commenced September 30, 2011) and the 2011 VML Term Facility (which commenced October 31, 2011).

The 2011 VML Credit Facility contains affirmative and negative covenants customary for such financings, including, but not limited to, limitations on liens, loans and guarantees, investments, acquisitions and asset sales, restricted payments and other distributions, affiliate transactions, certain capital expenditures and use of proceeds from the facility. The 2011 VML Credit Facility also requires the Borrower and VML to comply with financial covenants, including maximum ratios of total indebtedness to Adjusted EBITDA and minimum ratios of Adjusted EBITDA to net interest expense. The 2011 VML Credit Facility also contains events of default customary for such financings, which will not be effective until the Closing Date.

Singapore Credit Facility

As of September 30, 2011, the Company had SGD 102.8 million (approximately $79.4 million at exchange rates in effect on September 30, 2011) of available borrowing capacity under the Singapore Credit Facility, net of outstanding banker’s guarantees.

Cash Flows from Financing Activities

Cash flows from financing activities related to long-term debt and capital lease obligations are as follows (in thousands):


	Nine Months Ended
	September 30,
	2011			2010
Proceeds from VOL Credit Facility	$	—		$	751,169
Proceeds from Singapore Credit Facility		—			647,988

	$	—		$	1,399,157

Repayments on Singapore Credit Facility	$	(302,210	)	$	—
Repayments on VML Credit Facility		(43,750	)		(524,701	)
Repayments on Senior Secured Credit Facility		(21,703	)		(1,803,090	)
Repayments on Ferry Financing		(26,243	)		(26,331	)
Repayments on Airplane Financings		(2,766	)		(2,766	)
Repayments on HVAC Equipment Lease		(1,261	)		(1,293	)
Repayments on FF&E Facility and Other Long-Term Debt		(1,470	)		(109,746	)
Repurchase and cancellation of Senior Notes		—			(56,675	)

	$	(399,403	)	$	(2,524,602	)

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Fair Value of Long-Term Debt

The estimated fair value of the Company’s long-term debt as of September 30, 2011, was approximately $9.40 billion, compared to its carrying value of $9.72 billion. As of December 31, 2010, the estimated fair value of the Company’s long-term debt was approximately $9.72 billion, compared to its carrying value of $10.10 billion. The estimated fair value of the Company’s long-term debt is based on quoted market prices, if available, or by pricing models based on the value of related cash flows discounted at current market interest rates.

NOTE 4 — EQUITY AND EARNINGS PER SHARE

Preferred Stock and Warrants

Preferred stock dividend activity is as follows (in thousands):


		Preferred Stock
		Dividends Paid to		Preferred Stock		Total Preferred
Board of Directors’		Principal		Dividends Paid to		Stock
Declaration Date	Payment Date	Stockholder’s Family		Public Holders		Dividends Paid

February 5, 2010	February 16, 2010	$	13,125	$	10,225	$	23,350
May 4, 2010	May 17, 2010	$	13,125	$	10,225	$	23,350
July 29, 2010	August 16, 2010	$	13,125	$	10,225	$	23,350

						$	70,050

February 1, 2011	February 15, 2011	$	13,125	$	6,473	$	19,598
May 5, 2011	May 16, 2011	$	13,125	$	6,094	$	19,219
August 4, 2011	August 15, 2011	$	13,125	$	6,015	$	19,140

						$	57,957


November 4, 2011	November 15, 2011	$	13,125	$	4,215	$	17,340

During the nine months ended September 30, 2011, holders of preferred stock exercised 1,258,120 warrants to purchase an aggregate of 20,968,703 shares of the Company’s common stock at $6.00 per share and tendered 1,161,500 shares of preferred stock and $9.7 million in cash as settlement of the warrant exercise price. In conjunction with certain of these transactions, the Company paid $16.5 million in premiums to induce the exercise of warrants with settlement through tendering preferred stock. During the nine months ended September 30, 2011, the Company also repurchased and retired 581,629 shares of preferred stock for $64.9 million and recorded a $31.6 million repurchase premium as part of the transaction. During the nine months ended September 30, 2010, holders of preferred stock exercised 126 warrants to purchase an aggregate of 2,099 shares of the Company’s common stock at $6.00 per share and tendered 76 shares of preferred stock and approximately $5,000 in cash as settlement of the warrant exercise price.

During August 2011, the Company’s Board of Directors approved the redemption of all of the outstanding preferred stock on November 15, 2011. The Company expects to pay approximately $783.4 million to redeem all of the preferred shares outstanding as of September 30, 2011, and record a redemption premium of approximately $98.5 million during the three months ended December 31, 2011.

Subsequent to September 30, 2011, holders of preferred stock exercised 52,600 warrants to purchase an aggregate of 876,668 shares of the Company’s common stock at $6.00 per share and tendered 30,600 shares of preferred stock and $2.2 million in cash as settlement of the warrant exercise price. In conjunction with certain of these transactions, the Company paid $0.4 million in premiums to induce the exercise of warrants with settlement through tendering preferred stock. Additionally, subsequent to September 30, 2011, the Company repurchased and retired 155,000 shares of preferred stock for $17.4 million and will record a $8.5 million repurchase premium as part of these transactions.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Accumulated Comprehensive Income and Comprehensive Income

As of September 30, 2011 and December 31, 2010, accumulated comprehensive income consisted solely of foreign currency translation adjustments.

Total comprehensive income consisted of the following (in thousands):


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Net income	$	505,172		$	268,834		$	1,358,767		$	395,196
Currency translation adjustment		(117,492	)		78,886			(28,644	)		74,390

Total comprehensive income		387,680			347,720			1,330,123			469,586
Less: comprehensive income attributable to noncontrolling interests		(78,229	)		(58,004	)		(231,736	)		(120,830	)

Comprehensive income attributable to Las Vegas Sands Corp.	$	309,451		$	289,716		$	1,098,387		$	348,756

Noncontrolling Interests

In June 2011, the Company disposed of its interest in one of its majority owned subsidiaries, resulting in a loss of $3.7 million, which is included in loss on disposal of assets during the nine months ended September 30, 2011. In addition, during the nine months ended September 30, 2011, the Company distributed $7.8 million to certain of its noncontrolling interests.

Earnings Per Share

The weighted average number of common and common equivalent shares used in the calculation of basic and diluted earnings per share consisted of the following:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
Weighted-average common shares outstanding (used in the calculation of basic earnings per share)		729,773,246		660,836,841		727,309,255		660,495,783
Potential dilution from stock options, restricted stock and warrants		82,770,288		128,319,406		84,241,428		121,660,224

Weighted-average common and common equivalent shares (used in the calculation of diluted earnings per share)		812,543,534		789,156,247		811,550,683		782,156,007

Antidilutive stock options excluded from the calculation of diluted earnings per share		5,496,367		8,570,205		5,512,267		9,098,805

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 5 — VARIABLE INTEREST ENTITIES

The Company consolidates any variable interest entities (“VIEs”) in which it is the primary beneficiary and discloses significant variable interests in VIEs of which it is not the primary beneficiary, if any, which management determines such designation based on accounting standards for VIEs.

The Company has entered into various joint venture agreements with independent third parties. The operations of these joint ventures have been consolidated by the Company due to the Company’s significant investment in these joint ventures, its power to direct the activities of the joint ventures that would significantly impact their economic performance and the obligation to absorb potentially significant losses or the rights to receive potentially significant benefits from these joint ventures. The Company evaluates its primary beneficiary designation on an ongoing basis and will assess the appropriateness of the VIE’s status when events have occurred that would trigger such an analysis.

As of September 30, 2011 and December 31, 2010, the Company’s joint ventures had total assets of $106.5 million and $95.3 million, respectively, and total liabilities of $99.3 million and $78.4 million, respectively.

NOTE 6 — INCOME TAXES

The Company’s major tax jurisdictions are the U.S., Macau and Singapore. In 2010, the Internal Revenue Service (“IRS”) issued a Revenue Agent’s Report (“RAR”) for tax years 2005 through 2008 of which the Company is appealing certain adjustments proposed by the IRS. The Company is in the initial stages of the appeals process with the IRS and while the final outcome of these matters is inherently uncertain, the Company believes it is reasonably possible that the total amount of unrecognized tax benefits may decrease by a range between $0 and $23 million within the next twelve months primarily due to the possible settlement of matters presently under consideration at appeals. During the three months ended September 30, 2011, the IRS completed its field examination of the Company’s 2009 income tax return and issued an RAR proposing certain adjustments that the Company is currently evaluating. The Company is subject to examination for tax years after 2006 in Macau and Singapore. The Company believes it has adequately reserved for its uncertain tax positions; however, there is no assurance that the taxing authorities will not propose adjustments that are more or less than the Company’s expected outcome and impact the provision for income taxes.

The Company recorded valuation allowances on the net deferred tax assets of the Company’s U.S. operations and certain foreign jurisdictions and does not anticipate recording an income tax benefit related to these deferred tax assets. The Company will reassess the realization of deferred tax assets based on accounting standards for income taxes each reporting period and will be able to reduce the valuation allowance to the extent that the financial results of these operations improve and it becomes more likely than not that the deferred tax assets are realizable.

The Company received a 5-year income tax exemption in Macau that exempts the Company from paying corporate income tax on profits generated by gaming operations. The Company will continue to benefit from this tax exemption through the end of 2013. In February 2011, the Company entered into an agreement with the Macau government, effective through 2013, that provides for an annual payment of 14.4 million patacas (approximately $1.8 million at exchange rates in effect on September 30, 2011) that is a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 7 — STOCK-BASED EMPLOYEE COMPENSATION

Stock-based compensation activity under the LVSC 2004 and SCL Equity Plans is as follows (in thousands, except weighted average grant date fair values):


	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2011			2010		2011		2010
Compensation expense:
Stock options	$	10,339		$	13,487	$	35,308	$	42,169
Restricted shares		3,614			133		11,934		383

	$	13,953		$	13,620	$	47,242	$	42,552

Compensation cost capitalized as part of property and equipment	$	(324	)	$	659	$	692	$	2,187

LVSC 2004 Plan:
Stock options granted		—			289		260		4,378

Weighted average grant date fair value	$	—		$	20.99	$	36.33	$	15.40

Restricted shares granted		506			2		1,197		16

Weighted average grant date fair value	$	42.67		$	28.90	$	45.52	$	25.37

SCL Equity Plan:
Stock options granted		2,039			4,553		7,316		24,929

Weighted average grant date fair value	$	1.84		$	1.12	$	1.71	$	1.05

The fair value of each option grant was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions:


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
LVSC 2004 Plan:
Weighted average volatility		—	%		89.0	%		94.4	%		92.7	%
Expected term (in years)		—			6.0			6.3			5.4
Risk-free rate		—	%		3.0	%		2.7	%		2.9	%
Expected dividends		—			—			—			—
SCL Equity Plan:
Weighted average volatility		67.7	%		73.3	%		68.4	%		73.6	%
Expected term (in years)		6.3			6.3			6.3			6.2
Risk-free rate		0.8	%		1.5	%		1.4	%		2.0	%
Expected dividends		—			—			—			—

NOTE 8 — FAIR VALUE MEASUREMENTS

Under applicable accounting guidance, fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance also establishes a valuation hierarchy for inputs in measuring fair value that maximizes the use of observable inputs (inputs market participants would use based on market data obtained from sources independent of the Company) and minimizes the use of unobservable inputs (inputs that reflect the Company’s assumptions based upon the best information available in the circumstances) by requiring that the most observable inputs be used when available. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the assets or liabilities, either directly or indirectly. Level 3 inputs are unobservable inputs for the assets or liabilities. Categorization within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

The following table provides the assets carried at fair value (in thousands):


			Fair Value Measurements Using:
	Total		Quoted Market		Significant Other		Significant
	Carrying		Prices in Active		Observable Inputs		Unobservable
	Value		Markets (Level 1)		(Level 2)		Inputs (Level 3)
As of September 30, 2011
Cash equivalents(1)	$	2,229,081	$	2,229,081	$	—	$	—
Interest rate caps(2)	$	1,418	$	—	$	1,418	$	—
As of December 31, 2010
Cash equivalents(1)	$	2,490,809	$	2,490,809	$	—	$	—
Interest rate caps(2)	$	1,617	$	—	$	1,617	$	—


(1)		The Company has short-term investments classified as cash equivalents as the original maturities are less than 90 days.

(2)		As of September 30, 2011 and December 31, 2010, the Company has 39 and 34 interest rate cap agreements, respectively, with an aggregate fair value of approximately $1.4 million and $1.6 million, respectively, based on quoted market values from the institutions holding the agreements.

NOTE 9 — COMMITMENTS AND CONTINGENCIES

Litigation

The Company is involved in other litigation in addition to those noted below, arising in the normal course of business. Management has made certain estimates for potential litigation claims based upon consultation with legal counsel. Actual results could differ from these estimates; however, in the opinion of management, such litigation and claims will not have a material effect on the Company’s financial condition, results of operations or cash flows.

On October 15, 2004, Richard Suen and Round Square Company Limited filed an action against LVSC, Las Vegas Sands, Inc. (“LVSI”), Sheldon G. Adelson and William P. Weidner in the District Court of Clark County, Nevada, asserting a breach of an alleged agreement to pay a success fee of $5.0 million and 2.0% of the net profit from the Company’s Macau resort operations to the plaintiffs as well as other related claims. In March 2005, LVSC was dismissed as a party without prejudice based on a stipulation to do so between the parties. Pursuant to an order filed March 16, 2006, plaintiffs’ fraud claims set forth in the first amended complaint were dismissed with prejudice against all defendants. The order also dismissed with prejudice the first amended complaint against defendants Sheldon G. Adelson and William P. Weidner. On May 24, 2008, the jury returned a verdict for the plaintiffs in the amount of $43.8 million. On June 30, 2008, a judgment was entered in this matter in the amount of $58.6 million (including pre-judgment interest). The Company appealed the verdict to the Nevada Supreme Court. On November 17, 2010, the Nevada Supreme Court reversed the judgment and remanded the case to the District Court of Clark County for a new trial. In its decision reversing the monetary judgment against the Company, the Nevada Supreme Court also made several other rulings which may affect the outcome of the new trial, including overturning the pre-trial dismissal of the plaintiffs’ breach of contract claim and deciding several evidentiary matters, some of which confirmed and some of which overturned rulings made by the District Court of Clark County. As such, the Company is unable at this time to determine the probability of the outcome or range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.

On October 20, 2010, Steven C. Jacobs, the former Chief Executive Officer of SCL, filed an action against LVSC and SCL in the District Court of Clark County, Nevada, alleging breach of contract against LVSC and SCL and breach of the implied covenant of good faith and fair dealing and tortious discharge in violation of public policy against LVSC. On March 16, 2011, an amended complaint was filed, which added Sheldon G. Adelson as a defendant and alleged a claim of defamation per se against him, LVSC and SCL. On June 9, 2011, the District Court of Clark County dismissed the defamation claim and certified the decision as to Sheldon G. Adelson as a final judgment. On July 1, 2011, the plaintiff filed a notice of appeal regarding the final judgment as to Sheldon G. Adelson. On August 26, 2011, the Nevada Supreme Court issued a writ of mandamus instructing the District Court of Clark County to hold an evidentiary hearing on whether personal jurisdiction exists over SCL and stayed the case until after the district court’s decision. Mr. Jacobs is seeking unspecified damages. This action is in a preliminary stage and management has determined that based on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.

On February 9, 2011, LVSC received a subpoena from the Securities and Exchange Commission requesting that the Company produce documents relating to its compliance with the Foreign Corrupt Practices Act (the “FCPA”). The Company has also been advised by the Department of Justice that it is conducting a similar investigation. It is the Company’s belief that the subpoena may have emanated from allegations contained in the lawsuit filed by Steven C. Jacobs described above. The Company intends to cooperate with the investigations. Based on proceedings to date, management is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any.

On March 31, 2011, SCL filed an announcement with the SEHK stating that SCL has been informed by the Securities and Futures Commission of Hong Kong (the “SFC”) that SCL is under investigation by the SFC in relation to alleged breaches of the provisions of the Hong Kong Securities and Futures Ordinance and has been requested to produce certain documents. The Company intends to cooperate with the investigation. Based on proceedings to date, management is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

On May 24, 2010, Frank J. Fosbre, Jr. filed a purported class action complaint in the United States District Court for the District of Nevada (the “U.S. District Court”), against LVSC, Sheldon G. Adelson, and William P. Weidner. The complaint alleged that LVSC, through the individual defendants, disseminated or approved materially false information, or failed to disclose material facts, through press releases, investor conference calls and other means from August 1, 2007 through November 6, 2008. The complaint sought, among other relief, class certification, compensatory damages and attorneys’ fees and costs.

On July 21, 2010, Wendell and Shirley Combs filed a purported class action complaint in the U.S. District Court, against LVSC, Sheldon G. Adelson, and William P. Weidner. The complaint alleged that LVSC, through the individual defendants, disseminated or approved materially false information, or failed to disclose material facts, through press releases, investor conference calls and other means from June 13, 2007 through November 11, 2008. The complaint, which was substantially similar to the Fosbre complaint, discussed above, sought, among other relief, class certification, compensatory damages and attorneys’ fees and costs.

On August 31, 2010, the U.S. District Court entered an order consolidating the Fosbre and Combs cases, and appointed lead plaintiffs and lead counsel. As such, the Fosbre and Combs cases will be reported as one consolidated matter in the future. On November 1, 2010, a purported class action amended complaint was filed in the consolidated action against LVSC, Sheldon G. Adelson and William P. Weidner. The amended complaint alleges that LVSC, through the individual defendants, disseminated or approved materially false and misleading information, or failed to disclose material facts, through press releases, investor conference calls and other means from August 2, 2007 through November 6, 2008. The amended complaint seeks, among other relief, class certification, compensatory damages and attorneys’ fees and costs. On January 10, 2011, the defendants filed a motion to dismiss the amended complaint, which, on August 24, 2011, was granted in part, and denied in part, with the dismissal of certain allegations. The defendants will be answering the allegations remaining in the amended complaint and starting the discovery process. This consolidated action is in a preliminary stage and management has determined that based on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.

On March 9, 2011, Benyamin Kohanim filed a shareholder derivative action (the “Kohanim action”) on behalf of the Company in the District Court of Clark County, Nevada, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time. The complaint alleges, among other things, breach of fiduciary duties in failing to properly implement, oversee and maintain internal controls to ensure compliance with the FCPA. The complaint seeks to recover for the Company unspecified damages, including restitution and disgorgement of profits, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiff. On April 18, 2011, Ira J. Gaines, Sunshine Wire and Cable Defined Benefit Pension Plan Trust dated 1/1/92 and Peachtree Mortgage Ltd. filed a shareholder derivative action (the “Gaines action”) on behalf of the Company in the District Court of Clark County, Nevada, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time. The complaint raises substantially similar claims as alleged in the Kohanim action. The complaint seeks to recover for the Company unspecified damages, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiffs. The Kohanim and Gaines actions have been consolidated and will be reported as one consolidated matter in the future. On July 25, 2011, the plaintiffs filed a first verified amended consolidated complaint. This consolidated action is in a preliminary stage and management has determined that based on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.

On April 1, 2011, Nasser Moradi, Richard Buckman, Douglas Tomlinson and Matt Abbeduto filed a shareholder derivative action (the “Moradi action”), as amended on April 15, 2011, on behalf of the Company in the U.S. District Court, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time. The complaint raises substantially similar claims as alleged in the Kohanim and Gaines actions. The complaint seeks to recover for the Company unspecified damages, including exemplary damages and restitution, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiffs.

On April 18, 2011, the Louisiana Municipal Police Employees Retirement System filed a shareholder derivative action (the “LAMPERS action”) on behalf of the Company in the U.S. District Court, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time, and Wing T. Chao, a former member of the Board of Directors. The complaint raises substantially similar claims as alleged in the Kohanim, Moradi and Gaines actions. The complaint seeks to recover for the Company unspecified damages, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiff.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

On April 22, 2011, John Zaremba filed a shareholder derivative action (the “Zaremba action”) on behalf of the Company in the U.S. District Court, against Sheldon G. Adelson, Jason N. Ader, Irwin Chafetz, Charles D. Forman, George P. Koo, Michael A. Leven, Jeffrey H. Schwartz and Irwin A. Siegel, the members of the Board of Directors at the time, and Wing T. Chao, a former member of the Board of Directors. The complaint raises substantially similar claims as alleged in the Kohanim, Moradi, Gaines and LAMPERS actions. The complaint seeks to recover for the Company unspecified damages, including restitution, disgorgement of profits and injunctive relief, and also seeks to recover attorneys’ fees, costs and related expenses for the plaintiff. On August 25, 2011, the U.S. District Court consolidated the Moradi, LAMPERS and Zaremba actions and such actions will be reported as one consolidated matter in the future. This consolidated action is in a preliminary stage and management has determined that based on proceedings to date, it is currently unable to determine the probability of the outcome of this matter or the range of reasonably possible loss, if any. The Company intends to defend this matter vigorously.

Singapore Development Project

In August 2006, the Company entered into a development agreement, as amended by a supplementary agreement on December 11, 2009 (the “Development Agreement”), with the Singapore Tourism Board (the “STB”), which requires the Company to construct and operate the Marina Bay Sands in accordance with the Company’s proposal for the integrated resort and in accordance with the agreement. The Company entered into the SGD 5.44 billion (approximately $4.20 billion at exchange rates in effect on September 30, 2011) Singapore Credit Facility to fund a significant portion of the construction, operating and other development costs of the Marina Bay Sands.

The Development Agreement permits Marina Bay Sands to open in stages and in accordance with an agreed upon schedule. There are no financial consequences to MBS if it fails to meet the agreed upon schedule, provided that the entire integrated resort is opened by December 31, 2011. The Company believes it met the schedule by October 21, 2011, and is awaiting the results of an audit by the STB of satisfaction of the requirements of the Development Agreement. If the STB determines that the Company has not satisfied the requirements of the Development Agreement as of October 21, 2011, and the Company does not ultimately meet the December 31, 2011, deadline, the STB will be entitled to draw on the SGD 192.6 million (approximately $148.8 million at exchange rates in effect on September 30, 2011) security deposit under the Singapore Credit Facility.

Other Agreements

The Company has entered into an agreement with Starwood to manage hotels, as well as a brand serviced luxury apart-hotel, as part of Sands Cotai Central in Macau. The management agreement imposes certain construction and opening obligations and deadlines on the Company, and certain past and/or anticipated delays would allow Starwood to terminate its agreement. The Company has recommenced construction activities at Sands Cotai Central and is negotiating an amendment to its management agreement with Starwood to provide for new opening timelines. If negotiations are unsuccessful and Starwood exercises its rights to terminate its agreement, the Company would have to find a new manager and brand for these projects. The Company’s agreement with Starwood related to the sales and marketing of the Las Vegas Condo Tower has been terminated. If the Company is unsuccessful in finding a new brand in Las Vegas, it could have a material adverse effect on the Company’s financial condition, results of operations and cash flows.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 10 — SEGMENT INFORMATION

The Company’s principal operating and developmental activities occur in three geographic areas: United States, Macau and Singapore. The Company reviews the results of operations for each of its key operating segments: The Venetian Las Vegas, which includes the Sands Expo Center; The Palazzo; Sands Bethlehem; Sands Macao; The Venetian Macao; Four Seasons Macao; and Other Asia (comprised primarily of the Company’s ferry operations and various other operations that are ancillary to the Company’s properties in Macau); and Marina Bay Sands. The Company also reviews construction and development activities for each of its primary projects: The Venetian Las Vegas; The Palazzo; Sands Bethlehem; Sands Macao; The Venetian Macao; Four Seasons Macao; Other Asia; Marina Bay Sands; Other Development Projects (Sands Cotai Central and Cotai Strip parcels 3 and 7 and 8); and Corporate and Other (comprised primarily of airplanes and the Las Vegas Condo Tower). The Venetian Las Vegas and The Palazzo operating segments are managed as a single integrated resort and have been aggregated as one reportable segment (the “Las Vegas Operating Properties”), considering their similar economic characteristics, types of customers, types of service and products, the regulatory business environment of the operations within each segment and the Company’s organizational and management reporting structure. The Company’s segment information as of September 30, 2011 and December 31, 2010, and for the three and nine months ended September 30, 2011 and 2010, is as follows (in thousands):


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Net Revenues:
Macau:
The Venetian Macao	$	689,243		$	620,745		$	2,062,917		$	1,751,472
Sands Macao		307,420			288,235			961,173			874,253
Four Seasons Macao		169,050			160,367			461,914			406,807
Other Asia		43,190			28,403			109,413			80,961

		1,208,903			1,097,750			3,595,417			3,113,493
United States:
Las Vegas Operating Properties		347,446			290,690			985,043			902,419
Sands Bethlehem		106,720			82,843			294,870			218,708

		454,166			373,533			1,279,913			1,121,127
Marina Bay Sands		792,427			485,886			2,114,921			702,279
Intersegment eliminations		(46,121	)		(48,397	)		(123,861	)		(98,763	)

Total net revenues	$	2,409,375		$	1,908,772		$	6,866,390		$	4,838,136

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Adjusted Property EBITDA(1)
Macau:
The Venetian Macao	$	252,720		$	211,496		$	739,486		$	574,240
Sands Macao		75,821			74,103			264,042			225,076
Four Seasons Macao		59,719			48,962			154,886			101,456
Other Asia		2,515			(5,563	)		(11,321	)		(16,149	)

		390,775			328,998			1,147,093			884,623
United States:
Las Vegas Operating Properties		94,311			58,271			252,385			229,555
Sands Bethlehem		25,170			16,361			68,318			39,450

		119,481			74,632			320,703			269,005
Marina Bay Sands		413,893			241,589			1,103,723			336,055

Total adjusted property EBITDA		924,149			645,219			2,571,519			1,489,683
Other Operating Costs and Expenses
Stock-based compensation expense		(7,280	)		(8,309	)		(22,477	)		(22,880	)
Corporate expense		(54,031	)		(28,686	)		(133,983	)		(78,116	)
Rental expense		(10,143	)		(9,186	)		(33,333	)		(30,690	)
Pre-opening expense		(15,823	)		(10,107	)		(43,472	)		(97,684	)
Development expense		(3,308	)		(425	)		(6,301	)		(1,258	)
Depreciation and amortization		(200,071	)		(186,738	)		(596,469	)		(510,521	)
Impairment loss		—			(16,057	)		—			(16,057	)
Loss on disposal of assets		(937	)		(2,406	)		(8,879	)		(40,577	)

Operating income		632,556			383,305			1,726,605			691,900
Other Non-Operating Costs and Expenses
Interest income		2,369			2,661			8,444			6,367
Interest expense, net of amounts capitalized		(70,761	)		(76,723	)		(214,938	)		(231,875	)
Other income (expense)		(6,617	)		6,444			(9,384	)		(6,205	)
Loss on modification or early retirement of debt		—			(21,692	)		—			(18,555	)
Income tax expense		(52,375	)		(25,161	)		(151,960	)		(46,436	)

Net income	$	505,172		$	268,834		$	1,358,767		$	395,196


(1)		Adjusted property EBITDA is net income before royalty fees, stock-based compensation expense, corporate expense, rent expense, pre-opening expense, development expense, depreciation and amortization, impairment loss, loss on disposal of assets, interest, other income (expense), loss on modification or early retirement of debt and income taxes. Adjusted property EBITDA is used by management as the primary measure of operating performance of the Company’s properties and to compare the operating performance of the Company’s properties with that of its competitors.


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
Intersegment Revenues
Macau:
The Venetian Macao	$	801	$	1,535	$	2,624	$	6,701
Other Asia		9,857		17,942		27,340		48,376

		10,658		19,477		29,964		55,077
Las Vegas Operating Properties		35,202		28,872		93,187		43,234
Marina Bay Sands		261		48		710		452

Total intersegment revenues	$	46,121	$	48,397	$	123,861	$	98,763

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)


	Nine Months Ended
	September 30,
	2011		2010
Capital Expenditures
Corporate and Other	$	12,728	$	9,746
Macau:
The Venetian Macao		9,770		35,618
Sands Macao		4,130		2,500
Four Seasons Macao		16,525		29,348
Other Asia		5,220		2,524
Other Development Projects		571,730		200,292

		607,375		270,282
United States:
Las Vegas Operating Properties		27,872		16,076
Sands Bethlehem		46,562		34,077

		74,434		50,153
Marina Bay Sands		393,068		1,320,083

Total capital expenditures	$	1,087,605	$	1,650,264


	September 30,		December 31,
	2011		2010

Total Assets
Corporate and Other	$	1,204,990	$	1,574,180
Macau:
The Venetian Macao		3,985,225		3,194,598
Sands Macao		481,722		483,678
Four Seasons Macao		1,135,993		1,155,243
Other Asia		361,037		370,525
Other Development Projects		3,191,418		3,140,905

		9,155,395		8,344,949
United States:
Las Vegas Operating Properties		4,051,444		3,966,754
Sands Bethlehem		830,778		757,993

		4,882,222		4,724,747
Marina Bay Sands		6,722,644		6,400,432

Total assets	$	21,965,251	$	21,044,308


	September 30,		December 31,
	2011		2010
Total Long-Lived Assets
Corporate and Other	$	307,756	$	308,438
Macau:
The Venetian Macao		2,011,398		2,138,419
Sands Macao		294,142		315,380
Four Seasons Macao		993,485		1,024,302
Other Asia		219,811		230,640
Other Development Projects		2,923,377		2,303,959

		6,442,213		6,012,700
United States:
Las Vegas Operating Properties		3,291,618		3,429,997
Sands Bethlehem		613,777		608,021

		3,905,395		4,038,018
Marina Bay Sands		5,532,148		5,541,881

Total long-lived assets	$	16,187,512	$	15,901,037

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

NOTE 11 — CONDENSED CONSOLIDATING FINANCIAL INFORMATION

LVSC is the obligor of the Senior Notes due 2015. Las Vegas Sands, LLC, VCR, Mall Intermediate Holding Company, LLC, Venetian Transport, LLC, Venetian Marketing, Inc., Lido Intermediate Holding Company, LLC, Lido Casino Resort Holding Company, LLC, Interface Group-Nevada, Inc., Palazzo Condo Tower, LLC, Sands Pennsylvania, Inc., Phase II Mall Holding, LLC, LVS (Nevada) International Holdings, Inc. and LVS Management Services, LLC (collectively, the “Guarantor Subsidiaries”), have jointly and severally guaranteed the Senior Notes; however, not on a full and unconditional basis as a result of subsidiaries being able to be released as guarantors under certain circumstances customary for such arrangements. The voting stock of all entities included as Guarantor Subsidiaries is 100% owned directly or indirectly by Las Vegas Sands Corp. The noncontrolling interest amount included in the Guarantor Subsidiaries’ condensed consolidating balance sheets is related to non-voting preferred stock of one of the subsidiaries held by third parties.

In February 2008, all of the capital stock of Phase II Mall Subsidiary, LLC was sold to GGP and in connection therewith, it was released as a guarantor under the Senior Notes. The sale is not complete from an accounting perspective due to the Company’s continuing involvement in the transaction related to the participation in certain future revenues earned by GGP. Certain of the assets, liabilities and operating results related to the ownership and operation of the mall by Phase II Mall Subsidiary, LLC subsequent to the sale will continue to be accounted for by the Guarantor Subsidiaries, and therefore are included in the “Guarantor Subsidiaries” columns in the following condensed consolidating financial information. As a result, net assets of $0.7 million (consisting of $267.5 million of property and equipment, offset by $266.8 million of liabilities consisting primarily of deferred proceeds from the sale) and $38.0 million (consisting of $282.1 million of property and equipment, offset by $244.1 million of liabilities consisting primarily of deferred proceeds from the sale) as of September 30, 2011 and December 31, 2010, respectively, and a net loss (consisting primarily of depreciation expense) of $4.2 million and $15.4 million for the three and nine ended September 30, 2011, respectively, and $2.5 million and $9.9 million for the three and nine months ended September 30, 2010, respectively, related to the mall and are being accounted for by the Guarantor Subsidiaries. These balances and amounts are not collateral for the Senior Notes and should not be considered as credit support for the guarantees of the Senior Notes.

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

The condensed consolidating financial information of LVSC, the Guarantor Subsidiaries and the non-guarantor subsidiaries on a combined basis as of September 30, 2011 and December 31, 2010, and for the three and nine months ended September 30, 2011 and 2010, is as follows (in thousands):

Condensed Consolidating Balance Sheets
September 30, 2011


							Consolidating/
	Las Vegas		Guarantor		Non-Guarantor		Eliminating
	Sands Corp.		Subsidiaries		Subsidiaries		Entries			Total
Cash and cash equivalents	$	815,051	$	642,486	$	2,494,038	$	—		$	3,951,575
Restricted cash and cash equivalents		—		398		183,968		—			184,366
Intercompany receivables		112,243		86,277		23,253		(221,773	)		—
Accounts receivable, net		959		211,119		904,460		(3,642	)		1,112,896
Inventories		2,311		9,958		21,193		—			33,462
Deferred income taxes, net		—		24,810		128		(15,274	)		9,664
Prepaid expenses and other		8,844		6,885		35,761		(797	)		50,693

Total current assets		939,408		981,933		3,662,801		(241,486	)		5,342,656
Property and equipment, net		132,054		3,437,383		11,235,536		—			14,804,973
Investment in subsidiaries		7,467,949		5,885,648		—		(13,353,597	)		—
Deferred financing costs, net		648		23,185		102,586		—			126,419
Restricted cash and cash equivalents		—		4,327		31,183		—			35,510
Intercompany receivables		31,086		107,956		—		(139,042	)		—
Intercompany notes receivable		—		757,147		—		(757,147	)		—
Deferred income taxes, net		63,328		—		—		(48,967	)		14,361
Leasehold interests in land, net		—		—		1,382,539		—			1,382,539
Intangible assets, net		690		—		81,856		—			82,546
Other assets, net		113		22,520		153,614		—			176,247

Total assets	$	8,635,276	$	11,220,099	$	16,650,115	$	(14,540,239	)	$	21,965,251

Accounts payable	$	22,318	$	24,888	$	59,755	$	(3,642	)	$	103,319
Construction payables		184		2,271		353,231		—			355,686
Intercompany payables		23,253		112,243		86,277		(221,773	)		—
Accrued interest payable		1,602		1,055		16,661		—			19,318
Other accrued liabilities		19,308		192,915		1,106,634		—			1,318,857
Income taxes payable		—		1		79,243		(797	)		78,447
Deferred income taxes		15,274		—		—		(15,274	)		—
Current maturities of long-term debt		3,687		30,572		423,085		—			457,344

Total current liabilities		85,626		363,945		2,124,886		(241,486	)		2,332,971
Other long-term liabilities		26,760		11,398		43,792		—			81,950
Intercompany payables		59,857		—		79,185		(139,042	)		—
Intercompany notes payable		—		—		757,147		(757,147	)		—
Deferred income taxes		—		49,113		134,782		(48,967	)		134,928
Deferred amounts related to mall transactions		—		435,080		—		—			435,080
Long-term debt		261,090		2,847,001		6,173,993		—			9,282,084

Total liabilities		433,333		3,706,537		9,313,785		(1,186,642	)		12,267,013

Preferred stock issue to Principal Stockholder’s family		572,787		—		—		—			572,787
Total Las Vegas Sands Corp. stockholders’ equity		7,629,156		7,513,157		5,840,440		(13,353,597	)		7,629,156
Noncontrolling interests		—		405		1,495,890		—			1,496,295

Total equity		7,629,156		7,513,562		7,336,330		(13,353,597	)		9,125,451

Total liabilities and equity	$	8,635,276	$	11,220,099	$	16,650,115	$	(14,540,239	)	$	21,965,251

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Balance Sheets
December 31, 2010


							Consolidating/
	Las Vegas		Guarantor		Non-Guarantor		Eliminating
	Sands Corp.		Subsidiaries		Subsidiaries		Entries			Total
Cash and cash equivalents	$	1,031,844	$	412,226	$	1,593,011	$	—		$	3,037,081
Restricted cash and cash equivalents		—		2,179		162,136		—			164,315
Intercompany receivables		11,843		65,834		22,927		(100,604	)		—
Accounts receivable, net		298		156,012		561,217		(608	)		716,919
Inventories		2,174		11,755		18,331		—			32,260
Deferred income taxes, net		—		24,496		47,389		(10,279	)		61,606
Prepaid expenses and other		15,272		4,782		30,432		(3,760	)		46,726

Total current assets		1,061,431		677,284		2,435,443		(115,251	)		4,058,907
Property and equipment, net		133,901		3,570,465		10,797,831		—			14,502,197
Investment in subsidiaries		6,273,755		4,996,023		—		(11,269,778	)		—
Deferred financing costs, net		767		29,198		125,413		—			155,378
Restricted cash and cash equivalents		—		4,616		640,989		—			645,605
Intercompany receivables		31,996		97,813		—		(129,809	)		—
Intercompany notes receivable		—		638,986		—		(638,986	)		—
Deferred income taxes, net		62,638		—		—		(52,215	)		10,423
Leasehold interests in land, net		—		—		1,398,840		—			1,398,840
Intangible assets, net		590		—		89,215		—			89,805
Other assets, net		78		27,104		155,971		—			183,153

Total assets	$	7,565,156	$	10,041,489	$	15,643,702	$	(12,206,039	)	$	21,044,308

Accounts payable	$	5,750	$	26,975	$	81,388	$	(608	)	$	113,505
Construction payables		—		2,179		514,802		—			516,981
Intercompany payables		22,926		11,843		65,835		(100,604	)		—
Accrued interest payable		4,629		7,689		30,307		—			42,625
Other accrued liabilities		15,692		175,011		969,531		—			1,160,234
Income taxes payable		—		—		3,760		(3,760	)		—
Deferred income taxes		10,279		—		—		(10,279	)		—
Current maturities of long-term debt		3,687		30,606		732,775		—			767,068

Total current liabilities		62,963		254,303		2,398,398		(115,251	)		2,600,413
Other long-term liabilities		26,761		10,911		40,568		—			78,240
Intercompany payables		45,336		—		84,473		(129,809	)		—
Intercompany notes payable		—		—		638,986		(638,986	)		—
Deferred income taxes		—		53,034		114,400		(52,215	)		115,219
Deferred amounts related to mall transactions		—		442,114		—		—			442,114
Long-term debt		263,726		2,869,931		6,240,098		—			9,373,755

Total liabilities		398,786		3,630,293		9,516,923		(936,261	)		12,609,741

Preferred stock issue to Principal Stockholder’s family		503,379		—		—		—			503,379
Total Las Vegas Sands Corp. stockholders’ equity		6,662,991		6,410,791		4,858,987		(11,269,778	)		6,662,991
Noncontrolling interests		—		405		1,267,792		—			1,268,197

Total equity		6,662,991		6,411,196		6,126,779		(11,269,778	)		7,931,188

Total liabilities and equity	$	7,565,156	$	10,041,489	$	15,643,702	$	(12,206,039	)	$	21,044,308

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Operations
For the Three Months Ended September 30, 2011


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Revenues:
Casino	$	—		$	124,258		$	1,778,884		$	—		$	1,903,142
Rooms		—			114,046			148,306			—			262,352
Food and beverage		—			43,675			103,548			—			147,223
Convention, retail and other		—			74,333			188,250			(38,742	)		223,841

		—			356,312			2,218,988			(38,742	)		2,536,558
Less — promotional allowances		(167	)		(20,007	)		(106,606	)		(403	)		(127,183	)

Net revenues		(167	)		336,305			2,112,382			(39,145	)		2,409,375

Operating expenses:
Casino		—			71,088			922,953			(663	)		993,378
Rooms		—			35,589			17,904			—			53,493
Food and beverage		—			22,711			50,569			(1,499	)		71,781
Convention, retail and other		—			20,069			85,766			(6,606	)		99,229
Provision for doubtful accounts		—			260			33,693			—			33,953
General and administrative		—			65,396			175,480			(204	)		240,672
Corporate expense		48,539			58			35,607			(30,173	)		54,031
Rental expense		—			—			10,143			—			10,143
Pre-opening expense		—			—			15,823			—			15,823
Development expense		3,308			—			—			—			3,308
Depreciation and amortization		4,654			55,669			139,748			—			200,071
Loss on disposal of assets		—			—			937			—			937

		56,501			270,840			1,488,623			(39,145	)		1,776,819

Operating income (loss)		(56,668	)		65,465			623,759			—			632,556
Other income (expense):
Interest income		416			29,268			1,769			(29,084	)		2,369
Interest expense, net of amounts capitalized		(3,453	)		(24,704	)		(71,688	)		29,084			(70,761	)
Other expense		—			(2,145	)		(4,472	)		—			(6,617	)
Income from equity investments in subsidiaries		461,957			393,673			—			(855,630	)		—

Income before income taxes		402,252			461,557			549,368			(855,630	)		557,547
Income tax benefit (expense)		22,627			(16,715	)		(58,287	)		—			(52,375	)

Net income		424,879			444,842			491,081			(855,630	)		505,172
Net income attributable to noncontrolling interests		—			(487	)		(79,806	)		—			(80,293	)

Net income attributable to Las Vegas Sands Corp.	$	424,879		$	444,355		$	411,275		$	(855,630	)	$	424,879

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Operations
For the Three Months Ended September 30, 2010


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Revenues:
Casino	$	—		$	116,554		$	1,457,297		$	—		$	1,573,851
Rooms		—			105,649			102,511			—			208,160
Food and beverage		—			34,304			82,882			—			117,186
Convention, retail and other		—			63,501			115,858			(32,180	)		147,179

		—			320,008			1,758,548			(32,180	)		2,046,376
Less — promotional allowances		(128	)		(39,908	)		(96,626	)		(942	)		(137,604	)

Net revenues		(128	)		280,100			1,661,922			(33,122	)		1,908,772

Operating expenses:
Casino		—			73,740			809,234			(796	)		882,178
Rooms		—			24,218			12,648			—			36,866
Food and beverage		—			15,144			37,141			(1,379	)		50,906
Convention, retail and other		—			18,206			56,582			(4,185	)		70,603
Provision for doubtful accounts		—			5,681			32,152			—			37,833
General and administrative		—			62,389			131,400			(313	)		193,476
Corporate expense		24,931			47			30,141			(26,433	)		28,686
Rental expense		—			—			9,186			—			9,186
Pre-opening expense		178			3			9,942			(16	)		10,107
Development expense		425			—			—			—			425
Depreciation and amortization		3,295			55,345			128,098			—			186,738
Impairment loss		—			—			16,057			—			16,057
Loss on disposal of assets		—			322			2,084			—			2,406

		28,829			255,095			1,274,665			(33,122	)		1,525,467

Operating income (loss)		(28,957	)		25,005			387,257			—			383,305
Other income (expense):
Interest income		1,174			23,131			1,151			(22,795	)		2,661
Interest expense, net of amounts capitalized		(3,505	)		(26,172	)		(69,841	)		22,795			(76,723	)
Other income (expense)		(1,500	)		725			7,219			—			6,444
Loss on modification or early retirement of debt		—			(21,692	)		—			—			(21,692	)
Income from equity investments in subsidiaries		240,507			213,614			—			(454,121	)		—

Income before income taxes		207,719			214,611			325,786			(454,121	)		293,995
Income tax benefit (expense)		6,778			3,285			(35,224	)		—			(25,161	)

Net income		214,497			217,896			290,562			(454,121	)		268,834
Net income attributable to noncontrolling interests		—			—			(54,337	)		—			(54,337	)

Net income attributable to Las Vegas Sands Corp.	$	214,497		$	217,896		$	236,225		$	(454,121	)	$	214,497

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Operations
For the Nine Months Ended September 30, 2011


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Revenues:
Casino	$	—		$	312,504		$	5,117,399		$	—		$	5,429,903
Rooms		—			339,851			394,171			—			734,022
Food and beverage		—			141,555			297,077			—			438,632
Convention, retail and other		—			208,032			484,375			(103,269	)		589,138

		—			1,001,942			6,293,022			(103,269	)		7,191,695
Less — promotional allowances		(502	)		(53,850	)		(269,774	)		(1,179	)		(325,305	)

Net revenues		(502	)		948,092			6,023,248			(104,448	)		6,866,390

Operating expenses:
Casino		—			195,274			2,695,844			(1,791	)		2,889,327
Rooms		—			101,818			50,861			—			152,679
Food and beverage		—			69,661			151,421			(4,463	)		216,619
Convention, retail and other		—			62,783			245,578			(16,863	)		291,498
Provision for doubtful accounts		—			6,851			85,656			—			92,507
General and administrative		—			189,830			485,447			(559	)		674,718
Corporate expense		118,588			196			95,971			(80,772	)		133,983
Rental expense		—			—			33,333			—			33,333
Pre-opening expense		—			15			43,457			—			43,472
Development expense		6,301			—			—			—			6,301
Depreciation and amortization		13,315			172,282			410,872			—			596,469
(Gain) loss on disposal of assets		7,663			2,027			(811	)		—			8,879

		145,867			800,737			4,297,629			(104,448	)		5,139,785

Operating income (loss)		(146,369	)		147,355			1,725,619			—			1,726,605
Other income (expense):
Interest income		3,504			81,722			4,362			(81,144	)		8,444
Interest expense, net of amounts capitalized		(10,353	)		(70,638	)		(215,091	)		81,144			(214,938	)
Other expense		—			(1,873	)		(7,511	)		—			(9,384	)
Income from equity investments in subsidiaries		1,233,759			1,039,759			—			(2,273,518	)		—

Income before income taxes		1,080,541			1,196,325			1,507,379			(2,273,518	)		1,510,727
Income tax benefit (expense)		44,298			(43,736	)		(152,522	)		—			(151,960	)

Net income		1,124,839			1,152,589			1,354,857			(2,273,518	)		1,358,767
Net income attributable to noncontrolling interests		—			(1,779	)		(232,149	)		—			(233,928	)

Net income attributable to Las Vegas Sands Corp.	$	1,124,839		$	1,150,810		$	1,122,708		$	(2,273,518	)	$	1,124,839

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Operations
For the Nine Months Ended September 30, 2010


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Revenues:
Casino	$	—		$	374,801		$	3,555,121		$	—		$	3,929,922
Rooms		—			345,885			233,824			—			579,709
Food and beverage		—			119,099			195,245			—			314,344
Convention, retail and other		—			158,593			264,010			(51,943	)		370,660

		—			998,378			4,248,200			(51,943	)		5,194,635
Less — promotional allowances		(375	)		(131,352	)		(222,500	)		(2,272	)		(356,499	)

Net revenues		(375	)		867,026			4,025,700			(54,215	)		4,838,136

Operating expenses:
Casino		—			228,572			2,141,160			(1,972	)		2,367,760
Rooms		—			72,469			28,125			(1	)		100,593
Food and beverage		—			51,481			96,127			(4,601	)		143,007
Convention, retail and other		—			56,043			148,597			(10,307	)		194,333
Provision for doubtful accounts		—			23,376			49,610			—			72,986
General and administrative		—			182,424			311,081			(851	)		492,654
Corporate expense		67,238			179			47,132			(36,433	)		78,116
Rental expense		—			—			30,690			—			30,690
Pre-opening expense		535			6			97,193			(50	)		97,684
Development expense		1,258			—			—			—			1,258
Depreciation and amortization		9,331			171,475			329,715			—			510,521
Impairment loss		—			—			16,057			—			16,057
Loss on disposal of assets		—			9,026			31,551			—			40,577

		78,362			795,051			3,327,038			(54,215	)		4,146,236

Operating income (loss)		(78,737	)		71,975			698,662			—			691,900
Other income (expense):
Interest income		2,493			65,164			2,507			(63,797	)		6,367
Interest expense, net of amounts capitalized		(11,669	)		(82,880	)		(201,123	)		63,797			(231,875	)
Other income (expense)		(1,500	)		454			(5,159	)		—			(6,205	)
Gain (loss) on modification or early retirement of debt		3,358			(21,692	)		(221	)		—			(18,555	)
Income from equity investments in subsidiaries		376,674			322,268			—			(698,942	)		—

Income before income taxes		290,619			355,289			494,666			(698,942	)		441,632
Income tax benefit (expense)		(16,734	)		2,555			(32,257	)		—			(46,436	)

Net income		273,885			357,844			462,409			(698,942	)		395,196
Net income attributable to noncontrolling interests		—			—			(121,311	)		—			(121,311	)

Net income attributable to Las Vegas Sands Corp.	$	273,885		$	357,844		$	341,098		$	(698,942	)	$	273,885

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Cash Flows
For the Nine Months Ended September 30, 2011


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Net cash generated from (used in) operating activities	$	(128,534	)	$	232,218		$	1,825,489		$	—		$	1,929,173

Cash flows from investing activities:
Change in restricted cash and cash equivalents		—			2,070			588,026			—			590,096
Capital expenditures		(11,284	)		(29,229	)		(1,047,092	)		—			(1,087,605	)
Proceeds from disposal of property and equipment		—			—			5,487			—			5,487
Acquisition of intangible assets		(100	)		—			—			—			(100	)
Dividends received from Guarantor Subsidiaries		85,265			—			—			(85,265	)		—
Notes receivable to non-guarantor subsidiaries		—			(42,963	)		—			42,963			—
Dividends received from non-guarantor subsidiaries		—			127,472			—			(127,472	)		—
Repayments of receivable from non-guarantor subsidiaries		—			700			—			(700	)		—
Capital contributions to subsidiaries		(50,026	)		—			—			50,026			—

Net cash generated from (used in) investing activities		23,855			58,050			(453,579	)		(120,448	)		(492,122	)

Cash flows from financing activities:
Proceeds from exercise of stock options		20,390			—			2,022			—			22,412
Proceeds from the exercise of warrants		9,662			—			—			—			9,662
Dividends paid to preferred stockholders		(57,957	)		—			—			—			(57,957	)
Distributions to noncontrolling interests		—			(1,779	)		(6,027	)		—			(7,806	)
Dividends paid to Las Vegas Sands Corp.		—			(85,265	)		—			85,265			—
Dividends paid to Guarantor Subsidiaries		—			—			(127,472	)		127,472			—
Capital contributions received		—			50,000			26			(50,026	)		—
Borrowings from Guarantor Subsidiaries		—			—			42,963			(42,963	)		—
Repayments on borrowings from Guarantor Subsidiaries		—			—			(700	)		700			—
Repayments on Singapore credit facility		—			—			(302,210	)		—			(302,210	)
Repayments on VML credit facility		—			—			(43,750	)		—			(43,750	)
Repayments on senior secured credit facility		—			(21,703	)		—			—			(21,703	)
Repayments on ferry financing		—			—			(26,243	)		—			(26,243	)
Repayments on airplane financings		(2,766	)		—			—			—			(2,766	)
Repayments on HVAC equipment lease		—			(1,261	)		—			—			(1,261	)
Repayments on FF&E facility and other long-term debt		—			—			(1,470	)		—			(1,470	)
Repurchase of preferred stock		(64,949	)		—			—			—			(64,949	)
Payments of preferred stock inducement premium		(16,494	)		—			—			—			(16,494	)
Payments of deferred financing costs		—			—			(6,076	)		—			(6,076	)

Net cash used in financing activities		(112,114	)		(60,008	)		(468,937	)		120,448			(520,611	)

Effect of exchange rate on cash		—			—			(1,946	)		—			(1,946	)

Increase (decrease) in cash and cash equivalents		(216,793	)		230,260			901,027			—			914,494
Cash and cash equivalents at beginning of period		1,031,844			412,226			1,593,011			—			3,037,081

Cash and cash equivalents at end of period	$	815,051		$	642,486		$	2,494,038		$	—		$	3,951,575

LAS VEGAS SANDS CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (CONTINUED)
(UNAUDITED)

Condensed Consolidating Statements of Cash Flows
For the Nine Months Ended September 30, 2010


										Consolidating/
	Las Vegas			Guarantor			Non-Guarantor			Eliminating
	Sands Corp.			Subsidiaries			Subsidiaries			Entries			Total
Net cash generated from (used in) operating activities	$	(86,402	)	$	243,909		$	1,050,491		$	—		$	1,207,998

Cash flows from investing activities:
Change in restricted cash and cash equivalents		—			159			(836,964	)		—			(836,805	)
Capital expenditures		(5,261	)		(20,308	)		(1,624,695	)		—			(1,650,264	)
Proceeds from disposal of property and equipment		—			823			5,128			—			5,951
Acquisition of intangible assets		(590	)		—			(44,009	)		—			(44,599	)
Purchases of investments		—			—			(173,774	)		—			(173,774	)
Proceeds from investments		—			—			173,774			—			173,774
Notes receivable to non-guarantor subsidiaries		—			(43,312	)		—			43,312			—
Dividends from Guarantor Subsidiaries		5,265,485			—			—			(5,265,485	)		—
Dividends from non-guarantor subsidiaries		—			41,100			—			(41,100	)		—
Capital contributions to subsidiaries		(4,467,037	)		(16,537	)		—			4,483,574			—

Net cash generated from (used in) investing activities		792,597			(38,075	)		(2,500,540	)		(779,699	)		(2,525,717	)

Cash flows from financing activities:
Proceeds from exercise of stock options		6,396			—			—			—			6,396
Proceeds from exercise of warrants		5			—			—			—			5
Dividends paid to preferred stockholders		(70,050	)		—			—			—			(70,050	)
Dividends paid to Las Vegas Sands Corp.		—			(5,265,485	)		—			5,265,485			—
Dividends paid to Guarantor Subsidiaries		—			—			(41,100	)		41,100			—
Capital contributions received		—			4,300,037			183,537			(4,483,574	)		—
Borrowings from Guarantor Subsidiaries		—			—			43,312			(43,312	)		—
Proceeds from VOL credit facility		—			—			751,169			—			751,169
Proceeds from Singapore credit facility		—			—			647,988			—			647,988
Repayments on senior secured credit facility		—			(1,803,090	)		—			—			(1,803,090	)
Repayments on VML credit facility		—			—			(524,701	)		—			(524,701	)
Repurchase and cancellation of senior notes		(56,675	)		—			—			—			(56,675	)
Repayments on ferry financing		—			—			(26,331	)		—			(26,331	)
Repayments on airplane financings		(2,766	)		—			—			—			(2,766	)
Repayments on HVAC equipment lease		—			(1,293	)		—			—			(1,293	)
Repayments on FF&E facility and other long-term debt		—			(108,549	)		(1,197	)		—			(109,746	)
Payments of deferred financing costs		—			(9,905	)		(55,918	)		—			(65,823	)

Net cash generated from (used in) financing activities		(123,090	)		(2,888,285	)		976,759			779,699			(1,254,917	)

Effect of exchange rate on cash		—			—			11,932			—			11,932

Increase (decrease) in cash and cash equivalents		583,105			(2,682,451	)		(461,358	)		—			(2,560,704	)
Cash and cash equivalents at beginning of period		254,256			3,033,625			1,667,535			—			4,955,416

Cash and cash equivalents at end of period	$	837,361		$	351,174		$	1,206,177		$	—		$	2,394,712

LAS VEGAS SANDS CORP. AND SUBSIDIARIES


ITEM 2 —		*MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS*

The following discussion should be read in conjunction with, and is qualified in its entirety by, the condensed consolidated financial statements and the notes thereto, and other financial information included in this Form 10-Q. Certain statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. See “— Special Note Regarding Forward-Looking Statements.”

Operations

We view each of our casino properties as an operating segment. Our operating segments in the United States consist of The Venetian Resort Hotel Casino (“The Venetian Las Vegas”), The Palazzo Resort Hotel Casino (“The Palazzo”) and the Sands Casino Resort Bethlehem (the “Sands Bethlehem”). The Venetian Las Vegas and The Palazzo operating segments are managed as a single integrated resort and have been aggregated into one reportable segment (the “Las Vegas Operating Properties”), considering their similar economic characteristics, types of customers, types of service and products, the regulatory business environment of the operations within each segment and our organizational and management reporting structure. Our operating segments in the Macau Special Administrative Region (“Macau”) of the People’s Republic of China consist of the Sands Macao; The Venetian Macao Resort Hotel (“The Venetian Macao”); the Four Seasons Hotel Macao, Cotai Strip^™ and the Plaza Casino (collectively, the “Four Seasons Macao”); and other ancillary operations in that region (“Other Asia”). Our operating segment in Singapore, Marina Bay Sands, opened on April 27, 2010.

United States

Las Vegas

Our Las Vegas Operating Properties, situated on or near the Las Vegas Strip, consist of The Venetian Las Vegas, a Renaissance Venice-themed resort; The Palazzo, a resort featuring modern European ambience and design; and an expo and convention center of approximately 1.2 million square feet (the “Sands Expo Center”). Our Las Vegas Operating Properties represent an integrated resort with approximately 7,100 suites and approximately 225,000 square feet of gaming space. Our Las Vegas Operating Properties also feature a meeting and conference facility of approximately 1.1 million square feet; Canyon Ranch SpaClub facilities; a Paiza Club^™ offering services and amenities to premium customers, including luxurious VIP suites, spa facilities and private VIP gaming room facilities; entertainment facilities; an enclosed retail, dining and entertainment complex located within The Venetian Las Vegas of approximately 440,000 net leasable square feet (“The Grand Canal Shoppes”), which was sold to GGP Limited Partnership (“GGP”) in 2004; and an enclosed retail and dining complex located within The Palazzo of approximately 400,000 net leasable square feet (“The Shoppes at The Palazzo”), which was sold to GGP in February 2008. See “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 2 — Property and Equipment, Net” regarding the sale of The Shoppes at The Palazzo.

Approximately 70.0% and 63.9% of gross revenue at our Las Vegas Operating Properties for the nine months ended September 30, 2011 and 2010, respectively, was derived from room revenues, food and beverage services, and other non-gaming sources, and 30.0% and 36.1%, respectively, was derived from gaming activities. The percentage of non-gaming revenue reflects the integrated resort’s emphasis on the group convention and trade show business.

Pennsylvania

In May 2009, we partially opened the Sands Bethlehem, a gaming, hotel, retail and dining complex located on the site of the historic Bethlehem Steel Works in Bethlehem, Pennsylvania. Sands Bethlehem currently features approximately 152,000 square feet of gaming space, which include table games operations that commenced in July 2010; a 300-room hotel tower, which opened in May 2011; an arts and cultural center; and the broadcast home of the local PBS affiliate. We have initiated construction activities on the remaining components of the integrated resort, which include a 150,000-square-foot retail facility (with a progressive opening beginning in November 2011) and a 50,000-square-foot multipurpose event center (expected to open in the second quarter of 2012). Sands Bethlehem is also expected to be home to the National Museum of Industrial History. We own 86% of the economic interest of the gaming, hotel and entertainment portion of the property through our ownership interest in Sands Bethworks Gaming LLC and more than 35% of the economic interest of the retail portion of the property through our ownership interest in Sands Bethworks Retail LLC. Approximately 90.3% and 91.2% of the gross revenue at Sands Bethlehem for the nine months ended September 30, 2011 and 2010, respectively, was derived from gaming activities, with the remainder derived from food and beverage services and other non-gaming sources.

Macau

Sands China Ltd. (“SCL”) completed an initial public offering (the “SCL Offering”) by listing its ordinary shares on The Main Board of The Stock Exchange of Hong Kong Limited in November 2009. We own 70.3% of SCL, which includes the operations of the Sands Macao, The Venetian Macao, Four Seasons Macao and other ancillary operations that support these properties. We operate the gaming areas within these properties pursuant to a 20-year gaming subconcession.

We own and operate the Sands Macao, the first Las Vegas-style casino in Macau. The Sands Macao includes approximately 197,000 square feet of gaming space; a 289-suite hotel tower; several restaurants; VIP facilities; a theater and other high-end services and amenities. Approximately 94.5% and 94.1% of the gross revenue at the Sands Macao for the nine months ended September 30, 2011 and 2010, respectively, was derived from gaming activities, with the remainder primarily derived from room revenues and food and beverage services.

We also own and operate The Venetian Macao, the anchor property of our master-planned development of integrated resort properties that we refer to as the Cotai Strip^™ in Macau. With a theme similar to that of The Venetian Las Vegas, The Venetian Macao includes a 39-floor luxury hotel with over 2,900 suites; approximately 550,000 square feet of gaming space; a 15,000-seat arena; an 1,800-seat theater; retail and dining space of approximately 1.0 million square feet; and a convention center and meeting room complex of approximately 1.2 million square feet. Approximately 83.8% and 82.9% of the gross revenue at The Venetian Macao for the nine months ended September 30, 2011 and 2010, respectively, was derived from gaming activities, with the remainder derived from room revenues and other non-gaming sources.

We own the Four Seasons Macao, which is located adjacent and connected to The Venetian Macao. The Four Seasons Macao is an integrated resort that features 360 rooms and suites managed and operated by Four Seasons Hotels Inc.; 19 Paiza mansions; approximately 70,000 square feet of gaming space; retail space of approximately 211,000 square feet, which is connected to the mall at The Venetian Macao; several food and beverage offerings; and conference, banquet and other facilities operated by us. This integrated resort will also feature the Four Seasons Apartment Hotel Macao, Cotai Strip^™ (the “Four Seasons Apartments”), an apart-hotel tower that consists of approximately 1.0 million square feet of Four Seasons-serviced and -branded luxury apart-hotel units and common areas. We have completed the structural work of the tower and expect to monetize the units within the Four Seasons Apartments subject to market conditions and obtaining the necessary government approvals. Approximately 83.0% and 85.0% of the gross revenue at the Four Seasons Macao for the nine months ended September 30, 2011 and 2010, respectively, was derived from gaming activities, with the remainder derived from mall revenues, room revenues and other non-gaming sources.

Singapore

We own and operate the Marina Bay Sands in Singapore, which partially opened on April 27, 2010, with additional portions opened progressively throughout 2010. Marina Bay Sands features three 55-story hotel towers (with approximately 2,600 rooms and suites), the Sands SkyPark^™ (which sits atop the hotel towers and features an infinity swimming pool and several dining options), approximately 160,000 square feet of gaming space, an enclosed retail, dining and entertainment complex of approximately 800,000 net leasable square feet, a convention center and meeting room complex of approximately 1.2 million square feet and theaters. In February 2011, the Marina Bay Sands opened a landmark iconic structure at the bay-front promenade that contains an art/science museum. Approximately 76.5% of the gross revenue at the Marina Bay Sands for the nine months ended September 30, 2011, was derived from gaming activities, with the remainder derived from room revenues, food and beverage services and other non-gaming sources.

Development Projects

We have suspended portions of our development projects to focus our efforts on those projects with the highest expected rates of return on invested capital. Should general economic conditions fail to improve, if we are unable to obtain sufficient funding or applicable government approvals such that completion of our suspended projects is not probable, or should management decide to abandon certain projects, all or a portion of our investment to date on our suspended projects could be lost and would result in an impairment charge. In addition, we may be subject to penalties under the termination clauses in our construction contracts or termination rights under our management contracts with certain hotel management companies.

United States

We were constructing a high-rise residential condominium tower (the “Las Vegas Condo Tower”), located on the Las Vegas Strip between The Palazzo and The Venetian Las Vegas. We suspended our construction activities for the project due to reduced demand for Las Vegas Strip condominiums and the overall decline in general economic conditions. We intend to recommence construction when demand and conditions improve and expect that it will take approximately 18 months thereafter to complete construction of the project. As of September 30, 2011, we have capitalized construction costs of $178.0 million for this project. The impact of the suspension on the estimated overall cost of the project is currently not determinable with certainty.

Macau

We submitted plans to the Macau government for our other Cotai Strip developments, which represent three integrated resort developments, in addition to The Venetian Macao and Four Seasons Macao, on an area of approximately 200 acres (which we refer to as Sands Cotai Central (formerly parcels 5 and 6) and parcels 3 and 7 and 8). Subject to the approval from the Macau government, as discussed further below, the developments are expected to include hotels, exhibition and conference facilities, gaming areas, showrooms, spas, dining, retail and entertainment facilities and other amenities. We commenced construction or pre-construction activities on these developments and plan to operate the related gaming areas under our Macau gaming subconcession. In addition, we are completing the development of some public areas surrounding our Cotai Strip properties on behalf of the Macau government. We currently intend to develop our other Cotai Strip properties as follows:

•

Sands Cotai Central — We are staging the construction of the Sands Cotai Central integrated resort. Upon completion of phases I and II of the project, the integrated resort will feature approximately 5,800 hotel rooms, approximately 300,000 square feet of gaming space, approximately 1.2 million square feet of retail, entertainment, dining and exhibition and conference facilities, and a multipurpose theater. Phase I, which is currently expected to open at the end of the first quarter of 2012, includes a hotel tower on parcel 5 that was to be managed by Shangri-La International Hotel Management Limited (“Shangri-La”); however, in March 2011, we mutually agreed with Shangri-La to terminate the hotel management agreement. This hotel tower will now be managed by Hilton Worldwide, which will include 600 five-star rooms and suites under their Conrad brand, and InterContinental Hotels Group, which will include 1,200 four-star rooms and suites under their Holiday Inn brand. Phase I also includes completion of the structural work of an adjacent hotel tower, located on parcel 6, to be managed by Sheraton International Inc. and Sheraton Overseas Management Co. (collectively “Starwood”) under its Sheraton Towers brand, a variety of retail offerings, more than 300,000 square feet of meeting space, several food and beverage establishments, along with the 106,000 square foot casino and VIP gaming areas. Phase IIA, which is currently scheduled to open in the third quarter of 2012, includes the opening of the first hotel tower on parcel 6, which will feature nearly 2,000 Sheraton-branded rooms, along with the second casino and the remaining dining, entertainment, retail and meeting facilities. Phase IIB, which is projected to open in the first quarter of 2013, consists of the second hotel tower on parcel 6 and will feature an additional 2,000 rooms and suites under the Sheraton Towers brand. The total cost to complete phases I and II is expected to be approximately $1.6 billion. Phase III of the project is expected to include a fourth hotel and mixed-use tower, located on parcel 5, to be managed by Starwood under its St. Regis brand and the total cost to complete is expected to be approximately $450 million. We intend to commence construction of phase III of the project as demand and market conditions warrant it. As of September 30, 2011, we have capitalized costs of $2.73 billion for the entire project, including the land premium (net of amortization) and $183.9 million in outstanding construction payables. Our management agreement with Starwood imposes certain construction deadlines and opening obligations on us and certain past and/or anticipated delays, as described above, would allow Starwood to terminate its agreement. We are currently negotiating an amendment to the management agreement with Starwood to provide for new opening timelines.

•

Parcels 7 and 8 — If we are successful in winning our appeal and obtaining the land concession for parcels 7 and 8 (as discussed below), the related integrated resort is expected to be similar in size and scope to the Sands Cotai Central. We had commenced pre-construction activities and have capitalized construction costs of $100.7 million as of September 30, 2011. We intend to commence construction after Sands Cotai Central and the integrated resort on parcel 3 is complete, necessary government approvals are obtained (including the land concession), regional and global economic conditions improve, future demand warrants it and additional financing is obtained.

•

Parcel 3 — The integrated resort on parcel 3 will be connected to The Venetian Macao and Four Seasons Macao. The multi-hotel complex is intended to include a gaming area, a shopping mall and serviced luxury apart-hotel units. We had commenced pre-construction activities and have capitalized costs of $96.2 million, including the land premium (net of amortization), as of September 30, 2011. We intend to commence construction after Sands Cotai Central is complete, necessary government approvals are obtained, regional and global economic conditions improve, future demand warrants it and additional financing is obtained.

The impact of the delayed construction on our previously estimated cost to complete our Cotai Strip developments is currently not determinable. As of September 30, 2011, we have capitalized an aggregate of $7.11 billion in construction costs and land premiums (net of amortization) for our Cotai Strip developments, including The Venetian Macao, Four Seasons Macao and Sands Cotai Central, as well as our investments in transportation infrastructure, including our passenger ferry service operations. In addition to funding phases I and II of Sands Cotai Central with borrowings under our new $3.7 billion Macau credit facility entered into in September 2011 (the “2011 VML Credit Facility,” see “— Liquidity and Capital Resources — Development Financing Strategy” for further disclosure), we will need to arrange additional financing to fund the balance of our Cotai Strip developments and there is no assurance that we will be able to obtain any of the additional financing required.

Land concessions in Macau generally have an initial term of 25 years with automatic extensions of 10 years thereafter in accordance with Macau law. We have received land concessions from the Macau government to build on parcels 1, 2, 3 and 5 and 6, including the sites on which The Venetian Macao (parcel 1), Four Seasons Macao (parcel 2) and Sands Cotai Central (parcels 5 and 6) are located. We do not own these land sites in Macau; however, the land concessions grant us exclusive use of the land. As specified in the land concessions, we are required to pay premiums for each parcel, which are either payable in a single lump sum upon acceptance of the land concessions by the Macau government or in seven semi-annual installments (provided that the outstanding balance is due upon the completion of the corresponding integrated resort), as well as annual rent for the term of the land concessions. In December 2010, we received notice from the Macau government that our application for a land concession for parcels 7 and 8 was not approved and we applied to the Chief Executive of Macau for a review of the decision. In January 2011, we filed an appeal with the Court of Second Instance in Macau, which has yet to issue a decision. Should we win our appeal, it is still possible for the Chief Executive of Macau to again deny the land concession based upon public policy considerations. If we do not obtain the land concession or do not receive full reimbursement of our capitalized investment in this project, we would record a charge for all or some portion of the $100.7 million in capitalized construction costs, as of September 30, 2011, related to our development on parcels 7 and 8.

Under our land concession for parcel 3, we were initially required to complete the corresponding development by August 2011. The Macau government has granted us a two-year extension to complete the development of parcel 3, which now must be completed by April 2013. The land concession for Sands Cotai Central contains a similar requirement that the corresponding development be completed by May 2014. We believe that if we are not able to complete the developments by the respective deadlines, we will likely be able to obtain extensions from the Macau government; however, no assurances can be given that additional extensions will be granted. If we are unable to meet the applicable deadlines and those deadlines are not extended, we could lose our land concessions for parcel 3 or Sands Cotai Central, which would prohibit us from operating any facilities developed under the respective land concessions. As a result, we could record a charge for all or some portion of the $96.2 million and $2.73 billion in capitalized costs and land premiums (net of amortization), as of September 30, 2011, related to our developments on parcel 3 or Sands Cotai Central, respectively.

Other

When the current economic environment and access to capital improve, we may continue exploring the possibility of developing and operating additional properties, including integrated resorts, in additional Asian and U.S. jurisdictions, and in Europe.

Critical Accounting Policies and Estimates

The preparation of our condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. These estimates are based on historical information, information that is currently available to us and on various other assumptions that management believes to be reasonable under the circumstances. Actual results could vary from those estimates and we may change our estimates and assumptions in future evaluations. Changes in these estimates and assumptions may have a material effect on our financial condition and results of operations. We believe that these critical accounting policies affect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements. For a discussion of our significant accounting policies and estimates, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” presented in our 2010 Annual Report on Form 10-K filed on March 1, 2011.

There were no newly identified significant accounting estimates during the nine months ended September 30, 2011, nor were there any material changes to the critical accounting policies and estimates discussed in our 2010 Annual Report.

Recent Accounting Pronouncements

See related disclosure at “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 1 — Organization and Business of Company — Recent Accounting Pronouncements.”

Summary Financial Results

The following table summarizes our results of operations:


	Three Months Ended September 30,							Nine Months Ended September 30,
					Percent							Percent
	2011		2010		Change			2011		2010		Change
	(Dollars in thousands)
Net revenues	$	2,409,375	$	1,908,772		26.2	%	$	6,866,390	$	4,838,136		41.9	%
Operating expenses		1,776,819		1,525,467		16.5	%		5,139,785		4,146,236		24.0	%
Operating income		632,556		383,305		65.0	%		1,726,605		691,900		149.5	%
Income before income taxes		557,547		293,995		89.6	%		1,510,727		441,632		242.1	%
Net income		505,172		268,834		87.9	%		1,358,767		395,196		243.8	%
Net income attributable to Las Vegas Sands Corp.		424,879		214,497		98.1	%		1,124,839		273,885		310.7	%


	Percent of Net Revenues
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Operating expenses		73.7	%		79.9	%		74.9	%		85.7	%
Operating income		26.3	%		20.1	%		25.1	%		14.3	%
Income before income taxes		23.1	%		15.4	%		22.0	%		9.1	%
Net income		21.0	%		14.1	%		19.8	%		8.2	%
Net income attributable to Las Vegas Sands Corp.		17.6	%		11.2	%		16.4	%		5.7	%

Operating Results

Key Operating Revenue Measurements

Operating revenues at our Las Vegas Operating Properties, The Venetian Macao, Four Seasons Macao and Marina Bay Sands are dependent upon the volume of customers who stay at the hotel, which affects the price that can be charged for hotel rooms and the volume of table games and slot machine play. Operating revenues at Sands Macao and Sands Bethlehem are principally driven by casino customers who visit the properties on a daily basis.

The following are the key measurements we use to evaluate operating revenues:

Casino revenue measurements for the U.S.: Table games drop (“drop”) and slot handle (“handle”) are volume measurements. Win or hold percentage represents the percentage of drop or handle that is won by the casino and recorded as casino revenue. Table games drop represents the sum of markers issued (credit instruments) less markers paid at the table, plus cash deposited in the table drop box. Slot handle is the gross amount wagered for the period cited. We view table games win as a percentage of drop and slot hold as a percentage of slot handle. Based upon our mix of table games, our table games in Las Vegas have produced a trailing 12-month win percentage (calculated before discounts) of 17.5%. Slot machines in Las Vegas and Pennsylvania have produced a trailing 12-month hold percentage (calculated before slot club cash incentives) of 8.2% and 7.3%, respectively. Actual win may vary from the trailing 12-month win and hold percentages. Generally, slot machine play is conducted on a cash basis, whereas in Las Vegas, approximately 70.9% of our table games play for the nine months ended September 30, 2011, was conducted on a credit basis. In Pennsylvania, our table games play, which commenced in July 2010, was primarily conducted on a cash basis. We expect to increase the credit extended to our players as operations ramp up at Sands Bethlehem.

Casino revenue measurements for Macau and Singapore: Macau and Singapore table games are segregated into two groups, consistent with the Macau and Singapore market’s convention: Rolling Chip play (all VIP players) and Non-Rolling Chip play (mostly non-VIP players). The volume measurement for Rolling Chip play is non-negotiable gaming chips wagered and lost. The volume measurement for Non-Rolling Chip play is table games drop as previously described. Rolling Chip and Non-Rolling Chip volume measurements are not comparable as the amounts wagered and lost are substantially higher than the amounts dropped. Slot handle is the gross amount wagered for the period cited.

We view Rolling Chip win as a percentage of Rolling Chip volume, Non-Rolling Chip win as a percentage of drop and slot hold as a percentage of slot handle. Win or hold percentage represents the percentage of Rolling Chip volume, Non-Rolling Chip drop or slot handle that is won by the casino and recorded as casino revenue. Based upon our mix of table games, our Rolling Chip win percentage (calculated before discounts and commissions) is expected to be 2.7% to 3.0% and our Non-Rolling Chip table games have produced a trailing 12-month win percentage of 27.0%, 20.2%, 34.8% and 22.4% at The Venetian Macao, Sands Macao, Four Seasons Macao and Marina Bay Sands, respectively. Our slot machines have produced a trailing 12-month hold percentage of 6.8%, 6.0%, 6.0% and 5.4% at The Venetian Macao, Sands Macao, Four Seasons Macao and Marina Bay Sands, respectively. Actual win may vary from the trailing 12-month win and hold percentages. In Macau, 26.6% of our table games play was conducted on a credit basis for the nine months ended September 30, 2011. This percentage is expected to increase as we continue to extend credit to our premium players and junket operators for table games play. In Singapore, 34.6% of table games play was conducted on a credit basis for the nine months ended September 30, 2011. This percentage is expected to increase as we increase the credit extended to our premium players and as our operations ramp up at Marina Bay Sands.

Hotel revenue measurements: Hotel occupancy rate, which is the average percentage of available hotel rooms occupied during a period, and average daily room rate, which is the average price of occupied rooms per day, are used as performance indicators. Revenue per available room represents a summary of hotel average daily room rates and occupancy. Because not all available rooms are occupied, average daily room rates are normally higher than revenue per available room. Reserved rooms where the guests do not show up for their stay and lose their deposit may be re-sold to walk-in guests. These rooms are considered to be occupied twice for statistical purposes due to obtaining the original deposit and the walk-in guest revenue. In cases where a significant number of rooms are resold, occupancy rates may be in excess of 100% and revenue per available room may be higher than the average daily room rate.

Three Months Ended September 30, 2011 Compared to the Three Months Ended September 30, 2010

Operating Revenues

Our net revenues consisted of the following:


	Three Months Ended September 30,
							Percent
	2011			2010			Change
	(Dollars in thousands)
Casino	$	1,903,142		$	1,573,851			20.9	%
Rooms		262,352			208,160			26.0	%
Food and beverage		147,223			117,186			25.6	%
Convention, retail and other		223,841			147,179			52.1	%

		2,536,558			2,046,376			24.0	%
Less — promotional allowances		(127,183	)		(137,604	)		7.6	%

Total net revenues	$	2,409,375		$	1,908,772			26.2	%

Consolidated net revenues were $2.41 billion for the three months ended September 30, 2011, an increase of $500.6 million compared to $1.91 billion for the three months ended September 30, 2010. The increase in net revenues was driven by an increase of $306.5 million from the progressive opening of the Marina Bay Sands, as well as increases at our Macau and U.S. operations.

Casino revenues increased $329.3 million compared to the three months ended September 30, 2010. Of the increase, $237.5 million was attributable to Marina Bay Sands, as well as a $63.0 million increase at our Macau operations driven by an increase in Rolling Chip volume at Sands Macao and increases in Non-Rolling Chip drop and win percentage at The Venetian Macao. The following table summarizes the results of our casino activity:


	Three Months Ended September 30,
	2011			2010			Change
	(Dollars in thousands)
Macau Operations:
*The Venetian Macao*
Total casino revenues	$	586,945		$	540,284			8.6	%
Non-Rolling Chip drop	$	1,074,230		$	956,867			12.3	%
Non-Rolling Chip win percentage		27.6	%		26.6	%	1.0		pts
Rolling Chip volume	$	12,706,769		$	11,035,144			15.1	%
Rolling Chip win percentage		2.66	%		3.05	%	(0.39		)pts
Slot handle	$	897,109		$	853,705			5.1	%
Slot hold percentage		6.4	%		6.5	%	(0.1		)pts
*Sands Macao*
Total casino revenues	$	299,761		$	281,764			6.4	%
Non-Rolling Chip drop	$	722,595		$	649,605			11.2	%
Non-Rolling Chip win percentage		20.0	%		20.3	%	(0.3		)pts
Rolling Chip volume	$	7,902,923		$	6,275,044			25.9	%
Rolling Chip win percentage		2.65	%		3.00	%	(0.35		)pts
Slot handle	$	536,479		$	435,713			23.1	%
Slot hold percentage		5.3	%		5.7	%	(0.4		)pts
*Four Seasons Macao*
Total casino revenues	$	140,598		$	142,256			(1.2	)%
Non-Rolling Chip drop	$	107,610		$	98,537			9.2	%
Non-Rolling Chip win percentage		38.9	%		29.5	%	9.4		pts
Rolling Chip volume	$	4,160,488		$	4,740,576			(12.2	)%
Rolling Chip win percentage		2.90	%		3.08	%	(0.18		)pts
Slot handle	$	201,540		$	120,328			67.5	%
Slot hold percentage		6.4	%		5.4	%	1.0		pts
U.S Operations:
*Las Vegas Operating Properties*
Total casino revenues	$	124,258		$	116,554			6.6	%
Table games drop	$	536,109		$	476,492			12.5	%
Table games win percentage		20.4	%		17.1	%	3.3		pts
Slot handle	$	490,244		$	663,607			(26.1	)%
Slot hold percentage		8.7	%		7.9	%	0.8		pts
*Sands Bethlehem*
Total casino revenues	$	99,652		$	78,522			26.9	%
Table games drop	$	188,908		$	72,910			159.1	%
Table games win percentage		14.3	%		13.0	%	1.3		pts
Slot handle	$	988,426		$	934,586			5.8	%
Slot hold percentage		7.1	%		7.2	%	(0.1		)pts
Singapore Operations:
*Marina Bay Sands*
Total casino revenues	$	651,928		$	414,471			57.3	%
Non-Rolling Chip drop	$	1,199,171		$	892,079			34.4	%
Non-Rolling Chip win percentage		22.6	%		22.1	%	0.5		pts
Rolling Chip volume	$	16,720,235		$	10,254,561			63.1	%
Rolling Chip win percentage		2.69	%		2.65	%	0.04		pts
Slot handle	$	2,792,485		$	1,358,705			105.5	%
Slot hold percentage		5.3	%		5.9	%	(0.6		)pts

In our experience, average win percentages remain steady when measured over extended periods of time, but can vary considerably within shorter time periods as a result of the statistical variances that are associated with games of chance in which large amounts are wagered.

Room revenues increased $54.2 million compared to the three months ended September 30, 2010. Of the increase, $36.5 million was attributable to Marina Bay Sands, as well as increases at our Las Vegas Properties driven by increased room rates and at The Venetian Macao driven by increased occupancy and room rates. The suites at Sands Macao are primarily provided to casino patrons on a complimentary basis. The following table summarizes the results of our room activity:


	Three Months Ended September 30,
	2011			2010			Change
	(Dollars in thousands)
Macau Operations:
*The Venetian Macao*
Total room revenues	$	57,083		$	50,614			12.8	%
Occupancy rate		94.1	%		90.1	%	4.0		pts
Average daily room rate	$	232		$	217			6.9	%
Revenue per available room	$	218		$	195			11.8	%
*Sands Macao*
Total room revenues	$	6,157		$	6,089			1.1	%
Occupancy rate		92.9	%		96.6	%	(3.7		)pts
Average daily room rate	$	251		$	239			5.0	%
Revenue per available room	$	233		$	231			0.9	%
*Four Seasons Macao*
Total room revenues	$	8,257		$	7,632			8.2	%
Occupancy rate		70.8	%		70.9	%	(0.1		)pts
Average daily room rate	$	335		$	309			8.4	%
Revenue per available room	$	237		$	219			8.2	%
U.S. Operations:
*Las Vegas Operating Properties*
Total room revenues	$	114,046		$	105,649			7.9	%
Occupancy rate		92.7	%		93.7	%	(1.0		)pts
Average daily room rate	$	191		$	174			9.8	%
Revenue per available room	$	177		$	163			8.6	%
*Sands Bethlehem*
Total room revenues	$	2,144		$	—			—	%
Occupancy rate		47.3	%		—	%	—		pts
Average daily room rate	$	168		$	—			—	%
Revenue per available room	$	79		$	—			—	%
Singapore Operations:
*Marina Bay Sands*
Total room revenues	$	74,665		$	38,176			95.6	%
Occupancy rate		98.1	%		68.2	%	29.9		pts
Average daily room rate	$	327		$	246			32.9	%
Revenue per available room	$	321		$	168			91.1	%

Food and beverage revenues increased $30.0 million compared to the three months ended September 30, 2010. The increase was primarily due to a $17.2 million increase at the Marina Bay Sands and a $10.0 million increase at our Las Vegas Operating Properties driven by increased banquet activities.

Convention, retail and other revenues increased $76.7 million compared to the three months ended September 30, 2010. The increase was primarily due to increases at the Marina Bay Sands, The Venetian Macao and Four Seasons Macao of $38.0 million, $10.3 million and $7.7 million, respectively, driven by mall operations at these properties.

Operating Expenses

The breakdown of operating expenses is as follows:


	Three Months Ended September 30,
					Percent
	2011		2010		Change
	(Dollars in thousands)
Casino	$	993,378	$	882,178		12.6	%
Rooms		53,493		36,866		45.1	%
Food and beverage		71,781		50,906		41.0	%
Convention, retail and other		99,229		70,603		40.5	%
Provision for doubtful accounts		33,953		37,833		(10.3	)%
General and administrative		240,672		193,476		24.4	%
Corporate expense		54,031		28,686		88.4	%
Rental expense		10,143		9,186		10.4	%
Pre-opening expense		15,823		10,107		56.6	%
Development expense		3,308		425		678.4	%
Depreciation and amortization		200,071		186,738		7.1	%
Impairment loss		—		16,057		(100.0	)%
Loss on disposal of assets		937		2,406		(61.1	)%

Total operating expenses	$	1,776,819	$	1,525,467		16.5	%

Operating expenses were $1.78 billion for the three months ended September 30, 2011, an increase of $251.4 million compared to $1.53 billion for the three months ended September 30, 2010. The increase in operating expenses was primarily attributable to the progressive opening of Marina Bay Sands.

Casino expenses increased $111.2 million compared to the three months ended September 30, 2010. Of the increase, $68.3 million was attributable to the Marina Bay Sands and $30.0 million was due to the 39.0% gross win tax on increased casino revenues across all of our Macau operations.

Room, food and beverage and convention, retail and other expenses increased $16.6 million, $20.9 million and $28.6 million, respectively, compared to the three months ended September 30, 2010. The increases were driven by the associated increases in the related revenues described above.

The provision for doubtful accounts was $34.0 million for the three months ended September 30, 2011, compared to $37.8 million for the three months ended September 30, 2010. The amount of this provision can vary over short periods of time because of factors specific to the customers who owe us money from gaming activities at any given time. We believe that the amount of our provision for doubtful accounts in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.

General and administrative expenses increased $47.2 million compared to the three months ended September 30, 2010, primarily attributable to the $31.3 million increase at the Marina Bay Sands.

Corporate expenses increased $25.3 million compared to the three months ended September 30, 2010. The increase was primarily due to higher incentive compensation expenses and increased legal fees.

Pre-opening expenses were $15.8 million for the three months ended September 30, 2011, compared to $10.1 million for the three months ended September 30, 2010. Pre-opening expense represents personnel and other costs incurred prior to the opening of new ventures, which are expensed as incurred. Pre-opening expenses for the three months ended September 30, 2011, were primarily related to activities at Sands Cotai Central. Pre-opening expenses for the three months ended September 30, 2010, were primarily related to activities at Sands Cotai Central and Marina Bay Sands.

Depreciation and amortization expense increased $13.3 million compared to the three months ended September 30, 2010. The increase was primarily attributable to a $21.5 million increase at Marina Bay Sands, partially offset by decreases at our Macau properties due to certain assets being fully depreciated.

Adjusted Property EBITDA

Adjusted property EBITDA is used by management as the primary measure of the operating performance of our segments. Adjusted property EBITDA is net income before royalty fees, stock-based compensation expense, corporate expense, rental expense, pre-opening expense, development expense, depreciation and amortization, impairment loss, loss on disposal of assets, interest, other income (expense), loss on modification or early retirement of debt and income taxes. The following table summarizes information related to our segments (see “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 10 — Segment Information” for discussion of our operating segments and a reconciliation of adjusted property EBITDA to net income):


	Three Months Ended September 30,
						Percent
	2011		2010			Change
	(Dollars in thousands)
Macau:
The Venetian Macao	$	252,720	$	211,496			19.5	%
Sands Macao		75,821		74,103			2.3	%
Four Seasons Macao		59,719		48,962			22.0	%
Other Asia		2,515		(5,563	)		145.2	%

		390,775		328,998			18.8	%
United States:
Las Vegas Operating Properties		94,311		58,271			61.8	%
Sands Bethlehem		25,170		16,361			53.8	%

		119,481		74,632			60.1	%
Marina Bay Sands		413,893		241,589			71.3	%

Total adjusted property EBITDA	$	924,149	$	645,219			43.2	%

Adjusted property EBITDA at our Macau operations increased $61.8 million compared to the three months ended September 30, 2010, led by an increase of $41.2 million at The Venetian Macao. As previously described, the increase across the properties was primarily attributable to an increase in net revenues of $111.2 million, partially offset by an increase of $30.0 million in gross win tax on increased casino revenues.

Adjusted property EBITDA at our Las Vegas Operating Properties increased $36.0 million compared to the three months ended September 30, 2010. As previously described, the increase was primarily attributable to an increase in net revenues of $52.8 million (excluding intersegment royalty revenue), partially offset by increases in the associated operating expenses as a result of higher revenues.

Adjusted property EBITDA at Sands Bethlehem increased $8.8 million compared to the three months ended September 30, 2010. The increase was primarily attributable to an increase in net revenues of $23.9 million, driven by the commencement of table games operations in July 2010 and the opening of the 300-room hotel tower in May 2011, partially offset by increases in the associated operating expenses.

Adjusted property EBITDA at Marina Bay Sands, increased $172.3 million compared to the three months ended September 30, 2010. The increase was primarily attributable to an increase in net revenues of $306.5 million, driven by the progressive opening of the property, partially offset by increases in the associated operating expenses.

Interest Expense

The following table summarizes information related to interest expense on long-term debt:


	Three Months Ended
	September 30,
	2011			2010
	(Dollars in thousands)
Interest cost (which includes the amortization of deferred financing costs and original issue discount)	$	101,688		$	107,841
Add — imputed interest on deferred proceeds from sale of The Shoppes at The Palazzo		4,004			885
Less — capitalized interest		(34,931	)		(32,003	)

Interest expense, net	$	70,761		$	76,723

Cash paid for interest	$	89,070		$	102,367
Weighted average total debt balance	$	10,102,791		$	10,502,487
Weighted average interest rate		4.0	%		4.1	%

Interest cost decreased $6.2 million compared to the three months ended September 30, 2010, resulting from a decrease in our weighted average debt balances. Capitalized interest increased $2.9 million compared to the three months ended September 30, 2010, primarily due to increased construction activities at Sands Cotai Central in Macau.

Other Factors Effecting Earnings

Other expense was $6.6 million for the three months ended September 30, 2011, compared to other income of $6.4 million for the three months ended September 30, 2010. The amounts in both periods were primarily attributable to foreign exchange gains and losses, principally in Macau.

Our effective income tax rate was 9.4% for the three months ended September 30, 2011, compared to 8.6% for the three months ended September 30, 2010. The effective income tax rate for the three months ended September 30, 2011, reflects a 17% statutory tax rate on our Singapore operations; a zero percent tax rate from our Macau gaming operations due to our income tax exemption in Macau, which is set to expire in 2013; and non-realizable deferred tax assets in the U.S. and certain foreign jurisdictions, which unfavorably impacted our effective income tax rate. Management does not anticipate recording an income tax benefit related to deferred tax assets generated by operations in the U.S. and certain foreign jurisdictions; however, to the extent that the financial results of these operations improve and it becomes more likely than not that these deferred tax assets are realizable, we will reduce the valuation allowances in the period such determination is made.

The net income attributable to our noncontrolling interests was $80.3 million for the three months ended September 30, 2011, compared to $54.3 million for the three months ended September 30, 2010, and was primarily attributable to the noncontrolling interest of SCL for both periods.

Nine Months Ended September 30, 2011 Compared to the Nine Months Ended September 30, 2010

Operating Revenues

Our net revenues consisted of the following:


	Nine Months Ended September 30,
							Percent
	2011			2010			Change
	(Dollars in thousands)
Casino	$	5,429,903		$	3,929,922			38.2	%
Rooms		734,022			579,709			26.6	%
Food and beverage		438,632			314,344			39.5	%
Convention, retail and other		589,138			370,660			58.9	%

		7,191,695			5,194,635			38.4	%
Less — promotional allowances		(325,305	)		(356,499	)		8.8	%

Total net revenues	$	6,866,390		$	4,838,136			41.9	%

Consolidated net revenues were $6.87 billion for the nine months ended September 30, 2011, an increase of $2.03 billion compared to $4.84 billion for the nine months ended September 30, 2010. The increase in net revenues was driven by a $1.41 billion increase from the progressive opening of the Marina Bay Sands, as well as increases at our Macau and U.S. operations.

Casino revenues increased $1.50 billion compared to the nine months ended September 30, 2010. Of the increase, $1.11 billion was attributable to Marina Bay Sands, as well as a $384.6 million increase at our Macau operations driven primarily by increases in Rolling Chip volume and Non-Rolling Chip drop at The Venetian Macao and Sands Macao. The increase was partially offset by a decrease at our Las Vegas Operating Properties driven by a decrease in slot handle. The following table summarizes the results of our casino activity:


	Nine Months Ended September 30,
	2011			2010			Change
	(Dollars in thousands)
Macau Operations:
*The Venetian Macao*
Total casino revenues	$	1,788,833		$	1,521,090			17.6	%
Non-Rolling Chip drop	$	3,079,081		$	2,776,469			10.9	%
Non-Rolling Chip win percentage		27.0	%		25.5	%	1.5		pts
Rolling Chip volume	$	38,465,676		$	30,850,448			24.7	%
Rolling Chip win percentage		2.95	%		3.11	%	(0.16		)pts
Slot handle	$	2,498,423		$	2,226,029			12.2	%
Slot hold percentage		6.6	%		7.0	%	(0.4		)pts
*Sands Macao*
Total casino revenues	$	939,165		$	856,778			9.6	%
Non-Rolling Chip drop	$	2,124,760		$	1,842,682			15.3	%
Non-Rolling Chip win percentage		20.1	%		20.4	%	(0.3		)pts
Rolling Chip volume	$	23,925,627		$	19,902,862			20.2	%
Rolling Chip win percentage		2.79	%		3.08	%	(0.29		)pts
Slot handle	$	1,434,961		$	1,204,842			19.1	%
Slot hold percentage		5.8	%		5.8	%	—		pts
*Four Seasons Macao*
Total casino revenues	$	399,733		$	365,253			9.4	%
Non-Rolling Chip drop	$	286,982		$	293,102			(2.1	)%
Non-Rolling Chip win percentage		38.8	%		27.7	%	11.1		pts
Rolling Chip volume	$	11,464,101		$	13,303,508			(13.8	)%
Rolling Chip win percentage		3.05	%		2.91	%	0.14		pts
Slot handle	$	589,621		$	376,638			56.5	%
Slot hold percentage		6.1	%		5.5	%	0.6		pts
U.S Operations:
*Las Vegas Operating Properties*
Total casino revenues	$	312,503		$	374,801			(16.6	)%
Table games drop	$	1,434,904		$	1,440,665			(0.4	)%
Table games win percentage		17.9	%		18.5	%	(0.6		)pts
Slot handle	$	1,309,108		$	1,972,181			(33.6	)%
Slot hold percentage		8.7	%		7.8	%	0.9		pts
*Sands Bethlehem*
Total casino revenues	$	278,726		$	206,751			34.8	%
Table games drop	$	459,413		$	72,910			530.1	%
Table games win percentage		14.8	%		13.0	%	1.8		pts
Slot handle	$	2,817,673		$	2,803,567			0.5	%
Slot hold percentage		7.2	%		7.0	%	0.2		pts
Singapore Operations:
*Marina Bay Sands*
Total casino revenues	$	1,710,943		$	605,249			182.7	%
Non-Rolling Chip drop	$	3,300,078		$	1,430,375			130.7	%
Non-Rolling Chip win percentage		22.5	%		21.9	%	0.6		pts
Rolling Chip volume	$	39,081,385		$	14,138,555			176.4	%
Rolling Chip win percentage		2.75	%		2.52	%	0.23		pts
Slot handle	$	7,214,905		$	1,841,031			291.9	%
Slot hold percentage		5.3	%		6.3	%	(1.0		)pts

Room revenues increased $154.3 million compared to the nine months ended September 30, 2010. The increase in room revenues was attributable to $144.3 million from the Marina Bay Sands, as well as an increase at The Venetian Macao driven by increased room rates, partially offset by a decrease at our Las Vegas Operating Properties driven by reduced occupancy. The suites at Sands Macao are primarily provided to casino patrons on a complimentary basis. The following table summarizes the results of our room activity:


	Nine Months Ended September 30,
	2011			2010			Change
	(Dollars in thousands)
Macau Operations:
*The Venetian Macao*
Total room revenues	$	158,697		$	145,953			8.7	%
Occupancy rate		90.1	%		91.6	%	(1.5		)pts
Average daily room rate	$	227		$	207			9.7	%
Revenue per available room	$	205		$	190			7.9	%
*Sands Macao*
Total room revenues	$	17,270		$	18,919			(8.7	)%
Occupancy rate		88.6	%		97.2	%	(8.6		)pts
Average daily room rate	$	248		$	248			—	%
Revenue per available room	$	220		$	241			(8.7	)%
*Four Seasons Macao*
Total room revenues	$	23,315		$	21,117			10.4	%
Occupancy rate		67.8	%		71.0	%	(3.2		)pts
Average daily room rate	$	333		$	295			12.9	%
Revenue per available room	$	225		$	209			7.7	%
U.S Operations:
*Las Vegas Operating Properties*
Total room revenues	$	339,850		$	345,885			(1.7	)%
Occupancy rate		88.5	%		94.3	%	(5.8		)pts
Average daily room rate	$	201		$	191			5.2	%
Revenue per available room	$	178		$	180			(1.1	)%
*Sands Bethlehem*
Total room revenues	$	2,803		$	—			—	%
Occupancy rate		47.7	%		—	%	—		pts
Average daily room rate	$	168		$	—			—	%
Revenue per available room	$	80		$	—			—	%
Singapore Operations:
*Marina Bay Sands*
Total room revenues	$	192,087		$	47,835			301.6	%
Occupancy rate		91.8	%		64.8	%	27.0		pts
Average daily room rate	$	303		$	242			25.2	%
Revenue per available room	$	278		$	157			77.1	%

Food and beverage revenues increased $124.3 million compared to the nine months ended September 30, 2010. The increase was primarily due to a $92.5 million increase at the Marina Bay Sands and a $23.7 million increase at our Las Vegas Operating Properties driven by increased banquet activities.

Convention, retail and other revenues increased $218.5 million compared to the nine months ended September 30, 2010. The increase was primarily due to increases at the Marina Bay Sands, Four Seasons Macao and The Venetian Macao of $152.2 million, $15.5 million and $14.0 million, respectively, driven by mall operations at these properties.

Operating Expenses

The breakdown of operating expenses is as follows:


	Nine Months Ended September 30,
					Percent
	2011		2010		Change
	(Dollars in thousands)
Casino	$	2,889,327	$	2,367,760		22.0	%
Rooms		152,679		100,593		51.8	%
Food and beverage		216,619		143,007		51.5	%
Convention, retail and other		291,498		194,333		50.0	%
Provision for doubtful accounts		92,507		72,986		26.7	%
General and administrative		674,718		492,654		37.0	%
Corporate expense		133,983		78,116		71.5	%
Rental expense		33,333		30,690		8.6	%
Pre-opening expense		43,472		97,684		(55.5	)%
Development expense		6,301		1,258		400.9	%
Depreciation and amortization		596,469		510,521		16.8	%
Impairment loss		—		16,057		(100.0	)%
Loss on disposal of assets		8,879		40,577		(78.1	)%

Total operating expenses	$	5,139,785	$	4,146,236		24.0	%

Operating expenses were $5.14 billion for the nine months ended September 30, 2011, an increase of $993.5 million compared to $4.15 billion for the nine months ended September 30, 2010. The increase in operating expenses was primarily attributable to the progressive opening of Marina Bay Sands.

Casino expenses increased $521.6 million compared to the nine months ended September 30, 2010. Of the increase, $338.0 million was attributable to the Marina Bay Sands and $171.5 million was due to the 39.0% gross win tax on increased casino revenues across all of our Macau operations.

Room, food and beverage and convention, retail and other expenses increased $52.1 million, $73.6 million and $97.2 million, respectively, compared to the nine months ended September 30, 2010. The increases were driven by the associated increases in the related revenues described above.

The provision for doubtful accounts was $92.5 million for the nine months ended September 30, 2011, compared to $73.0 million for the nine months ended September 30, 2010. The increase was attributable to a $38.1 million increase in provisions at the Marina Bay Sands. The amount of this provision can vary over short periods of time because of factors specific to the customers who owe us money from gaming activities at any given time. We believe that the amount of our provision for doubtful accounts in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.

General and administrative expenses increased $182.1 million compared to the nine months ended September 30, 2010, primarily attributable to a $153.6 million increase at the Marina Bay Sands.

Corporate expenses increased $55.9 million compared to the nine months ended September 30, 2010. The increase was primarily due to higher incentive compensation expenses, as well as increased legal and recruitment expenses.

Pre-opening expenses were $43.5 million for the nine months ended September 30, 2011, compared to $97.7 million for the three months ended September 30, 2010. Pre-opening expense represents personnel and other costs incurred prior to the opening of new ventures, which are expensed as incurred. Pre-opening expenses for the nine months ended September 30, 2011, were primarily related to activities at Sands Cotai Central. Pre-opening expenses for the nine months ended September 30, 2010, were primarily related to activities at Marina Bay Sands and costs associated with recommencing work at Sands Cotai Central.

Depreciation and amortization expense increased $85.9 million compared to the nine months ended September 30, 2010. The increase was primarily the result of the opening of Marina Bay Sands, which contributed $112.6 million of the increase, partially offset by decreases at our Macau properties due to certain assets being fully depreciated.

Loss on disposal of assets was $8.9 million for the nine months ended September 30, 2011, compared to $40.6 million for the nine months ended September 30, 2010. The 2011 losses relate to the disposition of one of our majority owned subsidiaries, as well as the disposition of construction materials and equipment in Macau. The losses incurred during the nine months ended September 30, 2010, were principally related to the disposition of construction materials in Macau and Las Vegas.

Adjusted Property EBITDA


	Nine Months Ended September 30,
							Percent
	2011			2010			Change
	(Dollars in thousands)
Macau:
The Venetian Macao	$	739,486		$	574,240			28.8	%
Sands Macao		264,042			225,076			17.3	%
Four Seasons Macao		154,886			101,456			52.7	%
Other Asia		(11,321	)		(16,149	)		29.9	%

		1,147,093			884,623			29.7	%
United States:
Las Vegas Operating Properties		252,385			229,555			9.9	%
Sands Bethlehem		68,318			39,450			73.2	%

		320,703			269,005			19.2	%
Marina Bay Sands		1,103,723			336,055			228.4	%

Total adjusted property EBITDA	$	2,571,519		$	1,489,683			72.6	%

Adjusted property EBITDA at our Macau operations increased $262.5 million compared to the nine months ended September 30, 2010, led by an increase of $165.2 million at The Venetian Macao. As previously described, the increase across the properties was primarily attributable to an increase in net revenues of $481.9 million, partially offset by an increase of $171.5 million in gross win tax on increased casino revenues.

Adjusted property EBITDA at our Las Vegas Operating Properties increased $22.8 million compared to the nine months ended September 30, 2010. As previously described, the increase was primarily attributable to an increase in net revenues of $37.8 million (excluding intersegment royalty revenue), partially offset by increases in the associated operating expenses.

Adjusted property EBITDA at Sands Bethlehem increased $28.9 million compared to the nine months ended September 30, 2010. The increase was primarily driven by the commencement of table games operations in July 2010.

Adjusted property EBITDA at Marina Bay Sands does not have a comparable prior-year period as the property opened in April 2010.

Interest Expense

The following table summarizes information related to interest expense on long-term debt:


	Nine Months Ended
	September 30,
	2011			2010
	(Dollars in thousands)
Interest cost (which includes the amortization of deferred financing costs and original issue discount)	$	308,232		$	302,659
Add — imputed interest on deferred proceeds from sale of The Shoppes at The Palazzo		4,004			3,542
Less — capitalized interest		(97,298	)		(74,326	)

Interest expense, net	$	214,938		$	231,875

Cash paid for interest	$	300,482		$	279,669
Weighted average total debt balance	$	10,140,505		$	10,771,226
Weighted average interest rate		4.1	%		3.7	%

Interest cost increased $5.6 million compared to the nine months ended September 30, 2010, resulting from an increase in our weighted average interest rate, partially offset by a decrease in our weighted average debt balances. Capitalized interest increased $23.0 million compared to the nine months ended September 30, 2010, primarily due to the recommencement of activities at Sands Cotai Central in Macau.

Other Factors Effecting Earnings

Other expense was $9.4 million for the nine months ended September 30, 2011, which was primarily attributable to foreign exchange losses, principally in Macau. Other expense was $6.2 million for the nine months ended September 30, 2010, which was primarily attributable to a decrease in value of our interest rate caps.

Our effective income tax rate was 10.1% for the nine months ended September 30, 2011, compared to 10.5% for the nine months ended September 30, 2010. The effective income tax rate for the nine months ended September 30, 2011, reflects a 17% statutory tax rate on our Singapore operations; a zero percent tax rate from our Macau gaming operations due to our income tax exemption in Macau, which is set to expire in 2013; and non-realizable deferred tax assets in the U.S. and certain foreign jurisdictions, which unfavorably impacted our effective income tax rate. Management does not anticipate recording an income tax benefit related to deferred tax assets generated by operations in the U.S. and certain foreign jurisdictions; however, to the extent that the financial results of these operations improve and it becomes more likely than not that these deferred tax assets are realizable, we will reduce the valuation allowances in the period such determination is made.

The net income attributable to our noncontrolling interests was $233.9 million for the nine months ended September 30, 2011, compared to $121.3 million for the nine months ended September 30, 2010, and was primarily attributable to the noncontrolling interest of SCL for both periods.

Liquidity and Capital Resources

Cash Flows — Summary

Our cash flows consisted of the following:


	Nine Months Ended
	September 30,
	2011			2010
	(Dollars in thousands)
Net cash generated from operations	$	1,929,173		$	1,207,998

Investing cash flows:
Changes in restricted cash and cash equivalents		590,096			(836,805	)
Capital expenditures		(1,087,605	)		(1,650,264	)
Proceeds from disposal of property and equipment		5,487			5,951
Acquisition of intangible assets		(100	)		(44,599	)
Purchases of investments		—			(173,774	)
Proceeds from investments		—			173,774

Net cash used in investing activities		(492,122	)		(2,525,717	)

Financing cash flows:
Proceeds from exercise of stock options		22,412			6,396
Proceeds from exercise of warrants		9,662			5
Dividends paid to preferred stockholders		(57,957	)		(70,050	)
Distributions to noncontrolling interests		(7,806	)		—
Proceeds from long-term debt		—			1,399,157
Repayments on long-term debt		(399,403	)		(2,524,602	)
Repurchase of preferred stock		(64,949	)		—
Payments of preferred stock inducement premium		(16,494	)		—
Payments of deferred financing costs		(6,076	)		(65,823	)

Net cash used in financing activities		(520,611	)		(1,254,917	)

Effect of exchange rate on cash		(1,946	)		11,932

Increase (decrease) in cash and cash equivalents	$	914,494		$	(2,560,704	)

Cash Flows — Operating Activities

Table games play at our properties is conducted on a cash and credit basis. Slot machine play is primarily conducted on a cash basis. The retail hotel rooms business is generally conducted on a cash basis, the group hotel rooms business is conducted on a cash and credit basis, and banquet business is conducted primarily on a credit basis resulting in operating cash flows being generally affected by changes in operating income and accounts receivable. Net cash generated from operating activities for the nine months ended September 30, 2011, increased $721.2 million compared to the nine months ended September 30, 2010. The increase was primarily attributable to the increase in our operating results during the nine months ended September 30, 2011, as previously described.

Cash Flows — Investing Activities

Capital expenditures for the nine months ended September 30, 2011, totaled $1.09 billion, including $607.4 million for construction and development activities in Macau (primarily for our Sands Cotai Central development), $393.1 million for construction activities in Singapore, $46.6 million for construction activities at Sands Bethlehem; and $40.6 million at our Las Vegas Operating Properties and for corporate and other activities.

Cash Flows — Financing Activities

Net cash flows used in financing activities were $520.6 million for the nine months ended September 30, 2011, which was primarily attributable to the repayments of $302.2 million under our Singapore credit facility and $43.8 million under our VML credit facility, and payments of $64.9 million for preferred stock repurchases, $58.0 million for preferred stock dividends and $16.5 million to induce the exercise of warrants with settlement through tendering of preferred stock.

As of September 30, 2011, we had $1.80 billion available for borrowing under our U.S., Macau and Singapore credit facilities, net of letters of credit, outstanding banker’s guarantees and undrawn amounts committed to be funded by Lehman Brothers-related subsidiaries.

Development Financing Strategy

Through September 30, 2011, we have funded our development projects primarily through borrowings under our U.S., Macau and Singapore credit facilities, operating cash flows, proceeds from our equity offerings and proceeds from the disposition of non-core assets.

The U.S. credit facility, as amended in August 2010, requires our Las Vegas operations to comply with certain financial covenants at the end of each quarter, including maintaining a maximum leverage ratio of net debt, as defined, to trailing twelve-month adjusted earnings before interest, income taxes, depreciation and amortization, as defined (“Adjusted EBITDA”). The maximum leverage ratio is 6.0x for the quarterly periods ended September 30 and December 31, 2011, decreases to 5.5x for the quarterly periods ended March 31 and June 30, 2012, and then decreases to 5.0x for all quarterly periods thereafter through maturity. One of our Macau credit facilities, the VML credit facility, as amended in August 2009, requires certain of our Macau operations to comply with similar financial covenants, including maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 3.0x for all quarterly periods through maturity. We can elect to contribute up to $50 million and $20 million of cash on hand to our Las Vegas and relevant Macau operations, respectively, on a bi-quarterly basis; such contributions having the effect of increasing Adjusted EBITDA by the corresponding amount during the applicable quarter for purposes of calculating compliance with the maximum leverage ratio (the “EBITDA true-up”). The Singapore credit facility requires operations of Marina Bay Sands to comply with similar financial covenants, which commenced with the quarterly period ended September 30, 2011, including maintaining a

maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio is 5.5x for the quarterly period ended September 30, 2011, and then decreases by 0.25x every other quarter until September 30, 2014, when it decreases to, and remains at, 3.75x for all quarterly periods thereafter through maturity. Our 2011 VML Credit Facility, entered into in September 2011, will also require our Macau operations to comply with similar financial covenants commencing with the quarterly period ended March 31, 2012, including maintaining a maximum leverage ratio of debt to Adjusted EBITDA. The maximum leverage ratio will be 4.5x for the quarterly periods ended March 31, 2012 through June 30, 2013, decreases to 4.0x for the quarterly periods ended September 30, 2013 through December 31, 2014, decreases to 3.5x for the quarterly periods ended March 31 through December 31, 2015, and then decreases and remains at 3.0x for all quarterly periods thereafter through maturity. If we are unable to maintain compliance with the financial covenants under these credit facilities, it would be in default under the respective credit facilities. A default under the U.S. credit facility would trigger a cross-default under our airplane financings, which, if the respective lenders chose to accelerate the indebtedness outstanding under these agreements, would result in a default under our senior notes. Certain defaults under the VML credit facility would trigger a cross-default under our ferry financing. Any defaults or cross-defaults under these agreements would allow the lenders, in each case, to exercise their rights and remedies as defined under their respective agreements. If the lenders were to exercise their rights to accelerate the due dates of the indebtedness outstanding, there can be no assurance that we would be able to repay or refinance any amounts that may become due and payable under such agreements, which could force us to restructure or alter its operations or debt obligations.

In 2008, we completed a $475.0 million convertible senior notes offering and a $2.1 billion common and preferred stock and warrants offering. In 2009, we completed a $600.0 million exchangeable bond offering and our $2.5 billion SCL Offering. A portion of the proceeds from these offerings was used in the U.S. to pay down $775.9 million under the revolving portion of the U.S. credit facility in March 2010 and $1.0 billion under the term loan portions of the U.S. credit facility in August 2010, and to exercise the EBITDA true-up provision during the quarterly periods ended March 31, 2011. As of September 30, 2011, our U.S., VML, and Singapore leverage ratios were 4.0x, 1.3x and 2.5x, respectively, compared to the maximum leverage ratios allowed of 6.0x, 3.0x and 5.5x, respectively.

We held unrestricted and restricted cash and cash equivalents of approximately $3.95 billion and $219.9 million, respectively, as of September 30, 2011, of which approximately $2.45 billion of the unrestricted amount is held by non-U.S. subsidiaries. Of the $2.45 billion, approximately $1.56 billion is available to be repatriated to the U.S. with minimal taxes owed on such amounts due to the Company’s significant foreign taxes paid, which would ultimately generate foreign tax credits if cash is repatriated. The remaining unrestricted amounts are not available for repatriation due to bank compliance requirements or dividend requirements to third party public shareholders in the case of funds being repatriated from SCL. We believe the cash on hand, cash flow generated from operations and available borrowings under our credit facilities will be sufficient to fund our developments currently under construction and maintain compliance with the financial covenants of our U.S., Macau and Singapore credit facilities. In the normal course of our activities, we will continue to evaluate our capital structure and opportunities for enhancements thereof. We recommenced construction activities at Sands Cotai Central in May 2010 using proceeds from the $1.75 billion VOL credit facility together with $500.0 million of proceeds from the SCL Offering. In September 2011, we entered into the $3.7 billion 2011 VML Credit Facility, which, upon funding that is expected to occur in November 2011, will be used to repay the outstanding indebtedness under the VML and VOL credit facilities, as well as continue to fund the development, construction and completion of certain components of Sands Cotai Central. The 2011 VML Credit Facility will significantly reduce our interest expense, extend our Macau debt maturities to 2016, enhance our financial flexibility and further strengthen our financial position. The 2011 VML Credit Facility is expected to fund in November 2011 and we expect to record a $21.5 million loss on modification or extinguishment of debt in conjunction with the refinancing.

Additionally, in August 2011, our Board of Directors approved the redemption of all of the outstanding preferred stock on November 15, 2011. We expect to pay approximately $783.4 million to redeem all of the preferred shares outstanding as of September 30, 2011, and record a redemption premium of approximately $98.5 million during the three months ended December 31, 2011.

Aggregate Indebtedness and Other Known Contractual Obligations

As of September 30, 2011, there had been no material changes to our aggregated indebtedness and other known contractual obligations, which are set forth in the table included in our Annual Report on Form 10-K for the year ended December 31, 2010, except for the signing of the 2011 VML Credit Facility, which we expect to fund in November 2011. See “Item 1 — Financial Statements — Notes to Condensed Consolidated Financial Statements — Notes 3 — Long-Term Debt” for additional information on this credit facility.

Restrictions on Distributions

We are a parent company with limited business operations. Our main asset is the stock and membership interests of our subsidiaries. The debt instruments of our U.S., Macau and Singapore subsidiaries contain certain restrictions that, among other things, limit the ability of certain subsidiaries to incur additional indebtedness, issue disqualified stock or equity interests, pay dividends or make other distributions, repurchase equity interests or certain indebtedness, create certain liens, enter into certain transactions with affiliates, enter into certain mergers or consolidations or sell our assets of our company without prior approval of the lenders or noteholders.

Inflation

We believe that inflation and changing prices have not had a material impact on our sales, revenues or income from continuing operations during the past year.

Special Note Regarding Forward-Looking Statements

This report contains forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the discussions of our business strategies and expectations concerning future operations, margins, profitability, liquidity and capital resources. In addition, in certain portions included in this report, the words “anticipates,” “believes,” “estimates,” “seeks,” “expects,” “plans,” “intends” and similar expressions, as they relate to our company or management, are intended to identify forward-looking statements. Although we believe that these forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. These factors include, among others, the risks associated with:

	•		our substantial leverage, debt service and debt covenant compliance (including sensitivity to fluctuations in interest rates, as a significant portion of our debt is variable-rate debt, and other capital markets trends);

	•		disruptions in the global financing markets and our ability to obtain sufficient funding for our current and future developments, including our Cotai Strip, Singapore, Pennsylvania and Las Vegas developments;

	•		general economic and business conditions which may impact levels of disposable income, consumer spending, group meeting business, pricing of hotel rooms and retail and mall sales;

	•		increased competition for labor and materials due to other planned construction projects in Macau;

	•		the impact of the suspensions of certain of our development projects and our ability to meet certain development deadlines;

	•		the uncertainty of tourist behavior related to spending and vacationing at casino-resorts in Las Vegas, Macau and Singapore;

	•		regulatory policies in mainland China or other countries in which our customers reside, including visa restrictions limiting the number of visits or the length of stay for visitors from mainland China to Macau and restrictions on foreign currency exchange or importation of currency;

	•		our dependence upon properties primarily in Las Vegas, Macau and Singapore for all of our cash flow;

	•		our relationship with GGP or any successor owner of The Shoppes at The Palazzo and The Grand Canal Shoppes;

	•		new developments, construction and ventures, including our Cotai Strip developments;

	•		the passage of new legislation and receipt of governmental approvals for our proposed developments in Macau and other jurisdictions where we are planning to operate;

	•		our insurance coverage, including the risk that we have not obtained sufficient coverage or will only be able to obtain additional coverage at significantly increased rates;

	•		disruptions or reductions in travel due to acts of terrorism;

	•		disruptions or reductions in travel, as well as disruptions in our operations, due to outbreaks of infectious diseases, such as severe acute respiratory syndrome, avian flu or swine flu;

	•		government regulation of the casino industry, including gaming license regulation, the legalization of gaming in other jurisdictions and regulation of gaming on the Internet;

	•		increased competition in Las Vegas and Macau, including recent and upcoming increases in hotel rooms, meeting and convention space, and retail space;

	•		fluctuations in the demand for all-suites rooms, occupancy rates and average daily room rates in Las Vegas, Macau and Singapore;

	•		the popularity of Las Vegas, Macau and Singapore as convention and trade show destinations;

	•		new taxes, changes to existing tax rates or proposed changes in tax legislation;

	•		our ability to maintain our gaming licenses, certificates and subconcession;

	•		the completion of infrastructure projects in Macau and Singapore; and

	•		the outcome of any ongoing and future litigation.

All future written and verbal forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Readers are cautioned not to place undue reliance on these forward-looking statements. We assume no obligation to update any forward-looking statements after the date of this report as a result of new information, future events or developments, except as required by federal securities laws.


ITEM 3		— *QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK*

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodity prices. Our primary exposure to market risk is interest rate risk associated with our variable rate long-term debt, which we attempt to manage through the use of interest rate cap agreements. We do not hold or issue financial instruments for trading purposes and do not enter into derivative transactions that would be considered speculative positions. Our derivative financial instruments consist exclusively of interest rate cap agreements, which do not qualify for hedge accounting. Interest differentials resulting from these agreements are recorded on an accrual basis as an adjustment to interest expense.

To manage exposure to counterparty credit risk in interest rate cap agreements, we enter into agreements with highly rated institutions that can be expected to fully perform under the terms of such agreements. Frequently, these institutions are also members of the bank group providing our credit facilities, which management believes further minimizes the risk of nonperformance.

The table below provides information about our financial instruments that are sensitive to changes in interest rates. For debt obligations, the table presents notional amounts and weighted average interest rates by contractual maturity dates. Notional amounts are used to calculate the contractual payments to be exchanged under the contract. Weighted average variable rates are based on September 30, 2011, LIBOR, HIBOR and SOR plus the applicable interest rate spread in accordance with the respective debt agreements. The information is presented in U.S. dollar equivalents, which is the Company’s reporting currency, for the years ending September 30:


	2012			2013			2014			2015			2016			Thereafter			Total			Fair Value(1)
	(Dollars in millions)
LIABILITIES
Long-term debt
Fixed rate	$	—		$	—		$	—		$	189.7		$	—		$	—		$	189.7		$	191.1
Average interest rate(2)		—			—			—			6.4	%		—			—			6.4	%
Variable rate(3)	$	454.7		$	529.3		$	1,320.9		$	3,268.0		$	2,301.4		$	1,652.3		$	9,526.6		$	9,206.7
Average interest rate(2)		2.5	%		2.4	%		2.1	%		2.5	%		2.6	%		2.8	%		2.5	%
ASSETS
Cap agreements(4)	$	—		$	0.1		$	1.3		$	—		$	—		$	—		$	1.4		$	1.4


(1)		The estimated fair values are based on quoted market prices, if available, or by pricing models based on the value of related cash flows discounted at current market interest rates.

(2)		Based upon contractual interest rates for fixed rate indebtedness or current LIBOR, HIBOR and SOR for variable-rate indebtedness. Based on variable-rate debt levels as of September 30, 2011, an assumed 100 basis point change in LIBOR, HIBOR and SOR would cause our annual interest cost to change approximately $94.5 million.

(3)		As we have the ability and the intent to refinance the VML and the VOL credit facilities, $618.8 million of debt has been reclassified from current to long-term with the outstanding balances reflecting the payment terms of the 2011 VML Credit Facility as of September 30, 2011.

(4)		As of September 30, 2011, we have 39 interest rate cap agreements with an aggregate fair value of approximately $1.4 million based on quoted market values from the institutions holding the agreements.

Borrowings under the U.S. credit facility, as amended, bear interest, at our election, at either an adjusted Eurodollar rate or at an alternative base rate plus a credit spread. The portions of the revolving facility and term loans that were not extended bear interest at the alternative base rate plus 0.25% per annum or 0.5% per annum, respectively, or at the adjusted Eurodollar rate plus 1.25% per annum or 1.5% per annum, respectively. The extended revolving facility and extended term loans bear interest at the alternative base rate plus 1.0% per annum or 1.5% per annum, respectively, or at the adjusted Eurodollar rate plus 2.0% per annum or 2.5% per annum, respectively. Applicable spreads under the U.S. credit facility are subject to downward adjustments based upon our credit rating. Borrowings under the VML credit facility, as amended, bear interest, at our election, at either an adjusted Eurodollar rate (or in the case of the local term loan, adjusted HIBOR) plus 4.5% per annum or at an alternative base rate plus 3.5% per annum. Applicable spreads under the VML revolving facility are subject to a downward adjustment if certain consolidated leverage ratios are satisfied. Borrowings under the VOL credit facility bear interest at either the adjusted Eurodollar rate or an alternative base rate (in the case of U.S. dollar denominated loans) or HIBOR (in the case of Hong Kong dollar and Macau pataca denominated loans), as applicable, plus a spread of 4.5% per annum. Borrowings under the 2011 VML Credit Facility will bear interest at either the adjusted Eurodollar rate or an alternative base rate (in the case of U.S. dollar denominated loans) or HIBOR (in the case of Hong Kong dollar and Macau pataca denominated loans), as applicable, plus a spread of 2.25% for the first 180 days after the closing date (as defined per the agreement). Beginning 180 days after the closing date, the spread for all borrowings is subject to reduction based on a specified consolidated leverage ratio. Borrowings under the Singapore credit facility bear interest at SOR plus a spread of 2.25% per annum. Borrowings under the airplane financings bear interest at LIBOR plus approximately 1.5% per annum. Borrowings under the ferry financing, as amended, bear interest at HIBOR plus 2.5% per annum.

Foreign currency transaction losses for the nine months ended September 30, 2011, were $6.5 million. We may be vulnerable to changes in the U.S. dollar/pataca exchange rate. Based on balances as of September 30, 2011, an assumed 1% change in the U.S. dollar/pataca exchange rate would cause a foreign currency transaction gain/loss of approximately $16.6 million. We do not hedge our exposure to foreign currencies; however, we maintain a significant amount of our operating funds in the same currencies in which we have obligations thereby reducing our exposure to currency fluctuations.

See also “Liquidity and Capital Resources.”


ITEM 4 —		*CONTROLS AND PROCEDURES*

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure. The Company’s Chief Executive Officer and its Chief Financial Officer have evaluated the disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) of the Company as of September 30, 2011, and have concluded that they are effective at the reasonable assurance level.

It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Part II
OTHER INFORMATION


ITEM 1 —		*LEGAL PROCEEDINGS*

The Company is party to litigation matters and claims related to its operations. For more information, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, and “Part I — Item 1 —Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 9 — Commitments and Contingencies” of this Quarterly Report on Form 10-Q.


ITEM 1A —		*RISK FACTORS*

There have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.


ITEM 6 —		*EXHIBITS*

List of Exhibits


Exhibit No.			Description of Document
	10.1		Credit Agreement, dated as of September 21, 2011, entered into by and among VML US Finance LLC, Venetian Macau Limited, the financial institutions listed on the signature pages thereto as Lenders, Bank of China Limited, Macau Branch (“BOC”), as administrative agent for the Lenders, Goldman Sachs (Asia) L.L.C., Goldman Sachs Lending Partners LLC, Bank of America, N.A., BOC, Barclays Capital, BNP Paribas Hong Kong Branch, Citigroup Global Markets Asia Limited, Citibank, N.A. Hong Kong Branch, Commerzbank AG, Credit Agricole Corporate and Investment Bank, Credit Suisse Securities (USA) LLC, Credit Suisse AG, Singapore Branch, Industrial and Commercial Bank of China (Macau) Limited, ING Capital L.L.C. and ING Bank NV, Singapore Bank, Sumitomo Mitsui Banking Corporation, UBS Securities LLC and United Overseas Bank Limited, as global coordinators and bookrunners for the Term Loan Facility and Revolving Credit Facility and as co-syndication agents for the Term Loan Lenders and Revolving Loan Lenders and Banco Nacional Ultramarino, S.A., DBS Bank Ltd., Oversea-Chinese Banking Corporation Limited, The Bank of Nova Scotia and Wing Lung Bank Ltd., Macau Branch, as lead arrangers for the Term Loan Facility and Revolving Credit Facility.
	31.1		Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2		Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1		Certification of Chief Executive Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2		Certification of Chief Financial Officer of Las Vegas Sands Corp. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		*	XBRL Instance Document
101.SCH		*	XBRL Taxonomy Extension Schema Document
101.CAL		*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE		*	XBRL Taxonomy Extension Presentation Linkbase Document


*		Pursuant to Rule 406T of Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

LAS VEGAS SANDS CORP.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this quarterly report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.


	LAS VEGAS SANDS CORP.
	By:	/s/ Sheldon G. Adelson
		Sheldon G. Adelson
		Chairman of the Board and Chief Executive Officer

November 9, 2011


	By:	/s/ Kenneth J. Kay
		Kenneth J. Kay
		Chief Financial Officer

November 9, 2011