Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
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Las Vegas Sands Corp. pages available for free this week:
- Balance Sheet: Assets
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- Capital Asset Pricing Model (CAPM)
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
- Aggregate Accruals
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Economic Profit
Las Vegas Sands Corp., economic profit calculation
US$ in millions
| 12 months ended: | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | |
|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | ||||||
| Cost of capital2 | ||||||
| Invested capital3 | ||||||
| Economic profit4 | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2022 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The net operating profit after taxes experienced an initial increase from 3,351 million USD in 2018 to 3,870 million USD in 2019. However, starting in 2020, there was a significant decline, resulting in negative values of -1,708 million USD in 2020, -1,040 million USD in 2021, and -997 million USD in 2022. This indicates a sharp deterioration in operational profitability during the latter three years.
- Cost of Capital
- The cost of capital exhibited a relatively stable trend over the period, fluctuating mildly between 12.00% and 13.42%. It peaked at 13.42% in 2018 and decreased slightly over the next few years, reaching 12.00% in 2021 before rising modestly to 12.69% in 2022.
- Invested Capital
- Invested capital showed a downward trend from 19,047 million USD in 2018 to 15,828 million USD in 2021. However, there was a notable recovery to 18,926 million USD in 2022, almost returning to the 2018 level. This suggests a reduction in capital employed during the middle years followed by reinvestment or capital expansion in 2022.
- Economic Profit
- Economic profit mirrored the pattern observed in net operating profit. It increased from 795 million USD in 2018 to 1,465 million USD in 2019, indicating value creation. From 2020 onward, economic profit became negative, amounting to losses of -3,721 million USD in 2020, -2,939 million USD in 2021, and -3,399 million USD in 2022. This reflects sustained value destruction over these years, likely influenced by the severe operational losses despite relatively stable capital costs.
Net Operating Profit after Taxes (NOPAT)
Las Vegas Sands Corp., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in provision for credit losses.
3 Addition of increase (decrease) in equity equivalents to net income (loss) attributable to Las Vegas Sands Corp..
4 2022 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
5 2022 Calculation
Tax benefit of interest expense, net of amounts capitalized = Adjusted interest expense, net of amounts capitalized × Statutory income tax rate
= × 21.00% =
6 Addition of after taxes interest expense to net income (loss) attributable to Las Vegas Sands Corp..
7 Elimination of discontinued operations.
The data reveals notable fluctuations in the profitability of the company over the five-year period. Both net income attributable to the company and net operating profit after taxes (NOPAT) follow a similar trajectory, indicating consistent trends in core profitability measures.
- 2018 to 2019
- There is a positive growth trend in profitability. Net income increased from 2413 million USD to 2698 million USD, while NOPAT grew from 3351 million USD to 3870 million USD. This indicates improved operational efficiency and overall financial performance during this period.
- 2019 to 2020
- A significant decline is evident, with net income shifting from a strong positive figure to a substantial loss of 1685 million USD. Similarly, NOPAT declined sharply to a negative value of 1708 million USD. This suggests a severe disruption in operations or adverse market conditions affecting profitability.
- 2020 to 2021
- While still negative, there is an improvement in financial results compared to 2020. Net income losses reduced to 961 million USD and NOPAT losses to 1040 million USD, indicating a partial recovery or better cost management despite continuing challenges.
- 2021 to 2022
- Profitability returns to positive territory, with net income reported at 1832 million USD. However, NOPAT remains negative at 997 million USD, though with an improvement relative to previous years. This disparity may point to differences in tax effects or non-operating items influencing net income positively.
Overall, the data highlights a period marked by major volatility. Initial growth gave way to steep declines and losses in 2020 and 2021, likely reflecting exceptional external pressures. The return to positive net income in 2022 signals a potential stabilization or recovery phase, despite ongoing operational challenges as suggested by the continued negative NOPAT.
Cash Operating Taxes
Las Vegas Sands Corp., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
The financial data reveals distinct fluctuations in tax-related expenses and cash outflows over the analyzed period.
- Income Tax Expense (Benefit)
- From 2018 to 2019, there is a marked increase in income tax expense, rising from 375 million to 468 million US dollars. This trend reversed sharply in 2020 and 2021, where the figures turned negative, indicating income tax benefits (or credits) of 38 million and 5 million US dollars respectively. In 2022, the tax expense reverted to a positive amount of 154 million US dollars, though it remained significantly lower than the pre-2020 levels.
- Cash Operating Taxes
- Cash operating taxes show a somewhat different pattern. There is an initial decline from 370 million US dollars in 2018 to 431 million US dollars in 2019, after which a steep reduction is noted in 2020 to 110 million US dollars. Despite the partial recovery to 172 million in 2021, the cash operating taxes notably increase in 2022, reaching 305 million US dollars. Despite this increase, the 2022 level remains below levels seen in 2018 and 2019.
Overall, the data indicates a significant impact on income tax expense and cash tax payments from 2020 onward, possibly linked to external or extraordinary factors influencing taxable income and tax payment obligations. While income tax expense shifted into credits during 2020 and 2021, cash operating taxes, although reduced, remained positive with an upward trend resuming in 2022. This reflects variability in tax dynamics, suggesting changing profitability or tax regulation impacts during these years.
Invested Capital
Las Vegas Sands Corp., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of equity equivalents to total Las Vegas Sands Corp. stockholders’ equity.
5 Removal of accumulated other comprehensive income.
6 Subtraction of construction in progress.
- Total reported debt & leases
-
The total reported debt and leases exhibit an overall upward trend from 2018 to 2022. Starting at 13,299 million USD in 2018, the figure slightly decreased to 12,825 million USD in 2019. However, it then increased consistently over the next three years, reaching 14,330 million USD in 2020, 14,963 million USD in 2021, and peaking at 16,148 million USD in 2022. This pattern indicates a gradual increase in the company’s leverage over the period, with a notable rise following 2019.
- Total Las Vegas Sands Corp. stockholders’ equity
-
The stockholders’ equity experienced a declining trend from 2018 through 2021, indicative of a reduction in the company's net worth ascribed to shareholders. Equity decreased from 5,684 million USD in 2018 to 5,187 million USD in 2019, then sharply declined to 2,973 million USD in 2020 and further to 1,996 million USD in 2021. In 2022, there was a partial recovery with equity increasing to 3,881 million USD. Despite this improvement, the 2022 equity remains significantly lower than the initial 2018 level.
- Invested capital
-
Invested capital showed a declining trend from 19,047 million USD in 2018 to 15,828 million USD in 2021, which may reflect reduced asset base or adjustments in the company’s capital structure. However, in 2022, invested capital increased to 18,926 million USD, nearly returning to the initial level observed in 2018. This suggests that after several years of contraction, there was a resurgence in the resources dedicated to the company's operations or investments in 2022.
- Overall observations
-
Throughout the period from 2018 to 2022, the company increased its debt and lease obligations, indicating a growing reliance on external financing. Concurrently, stockholders’ equity declined significantly until 2021 but partially rebounded in 2022, potentially reflecting changes such as retained earnings, losses or capital injections. Invested capital contracted steadily until 2021, then expanded in 2022, suggesting renewed investment activity or asset acquisition. The trends imply a period of financial adjustment and restructuring through 2020 and 2021, followed by an attempt to stabilize and strengthen the balance sheet in 2022.
Cost of Capital
Las Vegas Sands Corp., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt, including current maturities3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in millions
2 Equity. See details »
3 Long-term debt, including current maturities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt, including current maturities3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in millions
2 Equity. See details »
3 Long-term debt, including current maturities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt, including current maturities3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-12-31).
1 US$ in millions
2 Equity. See details »
3 Long-term debt, including current maturities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt, including current maturities3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2019-12-31).
1 US$ in millions
2 Equity. See details »
3 Long-term debt, including current maturities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt, including current maturities3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2018-12-31).
1 US$ in millions
2 Equity. See details »
3 Long-term debt, including current maturities. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Las Vegas Sands Corp., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | ||||||
| Invested capital2 | ||||||
| Performance Ratio | ||||||
| Economic spread ratio3 | ||||||
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| Chipotle Mexican Grill Inc. | ||||||
| DoorDash, Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2022 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibited a significant increase from 2018 to 2019, rising from 795 million to 1,465 million USD. However, from 2020 onwards, there was a marked downturn, with the company recording substantial negative economic profits. In 2020, the economic profit fell sharply to -3,721 million USD, followed by a slight improvement in 2021 to -2,939 million USD, but again worsened in 2022 to -3,399 million USD. This indicates a severe decline in value generation during these years, likely reflecting challenging operational or market conditions.
- Invested Capital
- The invested capital showed a declining trend from 2018 through 2021, decreasing from 19,047 million USD in 2018 to a low of 15,828 million USD in 2021. In 2022, however, invested capital increased notably to 18,926 million USD, nearly returning to levels seen in 2018. This fluctuation suggests changes in the company’s asset base or capital allocation strategy, possibly in response to external or internal pressures.
- Economic Spread Ratio
- The economic spread ratio followed a pattern similar to economic profit. It was positive in 2018 and 2019, increasing from 4.17% to 8.14%. From 2020, the ratio turned negative, indicating that the return on invested capital was below the cost of capital. The ratio reached its lowest point at -23.33% in 2020, with some recovery to -18.57% in 2021 and a slight deterioration to -17.96% in 2022. This negative spread is consistent with the reported negative economic profits and suggests the company was not generating adequate returns relative to its invested capital during this period.
Economic Profit Margin
Las Vegas Sands Corp., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | ||||||
| Net revenues | ||||||
| Performance Ratio | ||||||
| Economic profit margin2 | ||||||
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Airbnb Inc. | ||||||
| Booking Holdings Inc. | ||||||
| Chipotle Mexican Grill Inc. | ||||||
| DoorDash, Inc. | ||||||
| McDonald’s Corp. | ||||||
| Starbucks Corp. | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Economic profit. See details »
2 2022 Calculation
Economic profit margin = 100 × Economic profit ÷ Net revenues
= 100 × ÷ =
3 Click competitor name to see calculations.
- Economic Profit
- The economic profit experienced a significant increase from 795 million USD in 2018 to 1465 million USD in 2019, indicating improved profitability during this period. However, the company faced considerable losses in the subsequent years, with negative economic profit values of -3721 million USD in 2020, -2939 million USD in 2021, and -3399 million USD in 2022. This trend reflects a sharp decline in the company's economic profitability starting in 2020, with persistent negative outcomes through 2022.
- Net Revenues
- Net revenues remained relatively stable between 2018 and 2019, with a slight increase from 13,729 million USD to 13,739 million USD. However, a substantial drop occurred in 2020, where revenues fell steeply to 3612 million USD, likely impacted by adverse conditions. Following this decline, revenues showed minor improvement in 2021, reaching 4234 million USD, but slightly decreased again in 2022 to 4110 million USD. Overall, revenues remained well below the levels observed in 2018 and 2019 during the three-year period beginning in 2020.
- Economic Profit Margin
- The economic profit margin mirrored the trends seen in economic profit values. It increased from 5.79% in 2018 to 10.67% in 2019, demonstrating enhanced efficiency in generating economic profit relative to net revenues. Beginning in 2020, the margin turned sharply negative, registering -103.01%, indicating significant losses exceeding revenue generation. Although the margin improved slightly in 2021 to -69.41%, and remained relatively stable at -82.7% in 2022, it consistently reflected poor profitability in these years.
- Summary
- The data reveals a strong financial performance in 2018 and 2019, followed by a severe downturn starting in 2020. Both economic profit and net revenues saw marked decreases due to factors likely affecting the operating environment. Despite some recovery in revenues in 2021, profitability remained substantially negative through 2022, which suggests ongoing challenges in restoring economic profitability at previous levels.