Sands China (1928.HK): Management Expects to Achieve Operating Leverage with Opex to Level Off in 2H26E

Research evidence excerpt

Sands China (1928.HK): Management Expects to Achieve Operating Leverage with Opex to Level Off in 2H26E

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22 Jul 2026 20:47:54 ET │ 16 pages

Sands China (1928.HK)

Management Expects to Achieve Operating Leverage with Opex to

Level Off in 2H26E

CITI'S TAKE

Management attributes the disappointing headline 2Q26 EBITDA of Buy

US$430m (-24% YoY) to the exceptionally low VIP hold and the Global

Soccer Tournament, but stressed that 2Q26 results do not represent the Catalyst Watch: Downside, expires 09-AUG-26

Sands China’s true earnings power. We are encouraged by management’s Price (22 Jul 26 16:10) HK$13.20

continued focus on gaining EBITDA market share. Its strong event and Target price HK$18.50↓concert lineup in 2H26 should help drive business recovery. Management

also expects its opex to level off in 2H26E, which should stabilize its EBITDA from HK$19.00

margin. Management intends to have all 2,900 rooms and suites at the Expected share price

Venetian completely refurbished and reintroduced by CNY-28E, and it 40.2% returnexpects little disruption throughout its property portfolio during the

process. We maintain our Buy rating (but trim our TP from HK$19 to Expected dividend yield 7.6%

HK$18.50) as Sands China is usually the largest beneficiary from the strong Expected total return 47.7%

visitation during the summer holidays. The stock has a 7.6% dividend yield, Market Cap HK$106,833Moffering investors meaningful downside risk protection.

US$13,625M

2Q26 Results Miss — Net revenue was largely flat YoY at US$1,790m (or -15% QoQ).

Property EBITDA fell 24% YoY to US$430m (or -32% QoQ), ~15% lower than our

forecast and BBG consensus (US$505m). Luck-adjusted property EBITDA would

have been US$517m. Luck-adjusted EBITDA margin declined ~4.6 ppts YoY to Price Performance