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.
Economic Profit
Las Vegas Sands Corp., economic profit 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 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
= -997 – 14.77% × 18,926 = -3,791
The financial trajectory between 2018 and 2022 indicates a significant shift from positive economic value creation to sustained value destruction. While the initial period showed growth in economic profit, the subsequent years were characterized by substantial losses that outweighed the costs of the capital employed.
- Net Operating Profit After Taxes (NOPAT)
- A peak in NOPAT was reached in 2019 at 3,870 million USD. However, a sharp reversal occurred in 2020, with figures dropping to -1,708 million USD. Although a gradual recovery trend is observable from 2020 to 2022, the figures remained in negative territory, concluding at -997 million USD in 2022.
- Cost of Capital
- The cost of capital remained relatively stable throughout the analyzed period, fluctuating within a narrow range between 13.92% and 15.61%. A slight downward trend was noted from 2018 through 2021, followed by a moderate increase to 14.77% in 2022.
- Invested Capital
- Invested capital experienced a steady decline from 19,047 million USD in 2018 to a period low of 15,828 million USD in 2021. This contraction reversed sharply in 2022, as invested capital increased to 18,926 million USD, returning nearly to 2018 levels.
- Economic Profit
- Economic profit shifted from a high of 1,069 million USD in 2019 to a severe deficit of -4,047 million USD in 2020. This negative trend persisted through 2022, with the economic profit ending at -3,791 million USD. The depth of these losses is the result of the convergence of negative NOPAT and the persistent capital charge required to support the invested capital base.
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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
= 170 × 4.90% = 8
5 2022 Calculation
Tax benefit of interest expense, net of amounts capitalized = Adjusted interest expense, net of amounts capitalized × Statutory income tax rate
= 710 × 21.00% = 149
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.
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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.
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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.
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Cost of Capital
Las Vegas Sands Corp., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 44,389) | 44,389) | ÷ | 59,699) | = | 0.74 | 0.74 | × | 18.77% | = | 13.96% | ||
| Long-term debt, including current maturities3 | 15,140) | 15,140) | ÷ | 59,699) | = | 0.25 | 0.25 | × | 3.99% × (1 – 21.00%) | = | 0.80% | ||
| Operating lease liability4 | 170) | 170) | ÷ | 59,699) | = | 0.00 | 0.00 | × | 4.90% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 59,699) | 1.00 | 14.77% | ||||||||||
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 | 33,768) | 33,768) | ÷ | 48,996) | = | 0.69 | 0.69 | × | 18.77% | = | 12.94% | ||
| Long-term debt, including current maturities3 | 15,060) | 15,060) | ÷ | 48,996) | = | 0.31 | 0.31 | × | 3.99% × (1 – 21.00%) | = | 0.97% | ||
| Operating lease liability4 | 168) | 168) | ÷ | 48,996) | = | 0.00 | 0.00 | × | 4.90% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 48,996) | 1.00 | 13.92% | ||||||||||
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 | 42,447) | 42,447) | ÷ | 57,920) | = | 0.73 | 0.73 | × | 18.77% | = | 13.75% | ||
| Long-term debt, including current maturities3 | 15,150) | 15,150) | ÷ | 57,920) | = | 0.26 | 0.26 | × | 4.30% × (1 – 21.00%) | = | 0.89% | ||
| Operating lease liability4 | 323) | 323) | ÷ | 57,920) | = | 0.01 | 0.01 | × | 4.60% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 57,920) | 1.00 | 14.66% | ||||||||||
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 | 51,014) | 51,014) | ÷ | 64,557) | = | 0.79 | 0.79 | × | 18.77% | = | 14.83% | ||
| Long-term debt, including current maturities3 | 13,210) | 13,210) | ÷ | 64,557) | = | 0.20 | 0.20 | × | 4.34% × (1 – 21.00%) | = | 0.70% | ||
| Operating lease liability4 | 333) | 333) | ÷ | 64,557) | = | 0.01 | 0.01 | × | 4.60% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 64,557) | 1.00 | 15.55% | ||||||||||
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 | 47,751) | 47,751) | ÷ | 60,715) | = | 0.79 | 0.79 | × | 18.77% | = | 14.76% | ||
| Long-term debt, including current maturities3 | 11,650) | 11,650) | ÷ | 60,715) | = | 0.19 | 0.19 | × | 5.05% × (1 – 21.00%) | = | 0.77% | ||
| Operating lease liability4 | 1,314) | 1,314) | ÷ | 60,715) | = | 0.02 | 0.02 | × | 5.05% × (1 – 21.00%) | = | 0.09% | ||
| Total: | 60,715) | 1.00 | 15.61% | ||||||||||
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 | (3,791) | (3,243) | (4,047) | 1,069) | 377) | |
| Invested capital2 | 18,926) | 15,828) | 15,949) | 18,011) | 19,047) | |
| Performance Ratio | ||||||
| Economic spread ratio3 | -20.03% | -20.49% | -25.37% | 5.93% | 1.98% | |
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Airbnb Inc. | 11.00% | -11.10% | — | — | — | |
| Booking Holdings Inc. | 3.79% | -13.66% | — | — | — | |
| Chipotle Mexican Grill Inc. | 2.82% | -1.67% | — | — | — | |
| DoorDash, Inc. | -53.28% | -39.79% | — | — | — | |
| McDonald’s Corp. | 5.87% | 8.30% | — | — | — | |
| Starbucks Corp. | 2.80% | 4.06% | -8.49% | — | — | |
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 × -3,791 ÷ 18,926 = -20.03%
4 Click competitor name to see calculations.
The financial performance from 2018 to 2022 reflects a significant transition from value creation to substantial value destruction. While the initial period showed growth in economic efficiency, the subsequent years were characterized by severe negative returns that consistently failed to cover the cost of invested capital.
- Economic Profit Trends
- A positive trajectory was observed between 2018 and 2019, with economic profit increasing from 377 million USD to 1,069 million USD. However, a drastic reversal occurred in 2020, where profit plummeted to negative 4,047 million USD. Despite a marginal recovery in 2021, economic profit remained deeply negative, ending the period at negative 3,791 million USD in 2022.
- Invested Capital Fluctuations
- Invested capital experienced a steady decline from 19,047 million USD in 2018 to a low of 15,828 million USD in 2021. This contraction was followed by a sharp increase in 2022, returning to 18,926 million USD, nearly reaching the levels seen at the start of the analyzed period.
- Economic Spread Ratio Analysis
- The economic spread ratio peaked in 2019 at 5.93%, indicating that the company was generating returns well above its cost of capital. This was followed by a collapse to negative 25.37% in 2020. Although the ratio showed slight improvements in 2021 and 2022, stabilizing around negative 20.03%, the persistent negative spread confirms that the company did not generate sufficient operating returns to justify the capital employed during the latter three years of the period.
The correlation between the sharp decline in economic profit and the negative economic spread ratio suggests a period of severe operational distress. The increase in invested capital in 2022, occurring while the spread ratio remained deeply negative, indicates that additional capital was deployed without an immediate return to positive economic value added.
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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 | (3,791) | (3,243) | (4,047) | 1,069) | 377) | |
| Net revenues | 4,110) | 4,234) | 3,612) | 13,739) | 13,729) | |
| Performance Ratio | ||||||
| Economic profit margin2 | -92.25% | -76.59% | -112.03% | 7.78% | 2.75% | |
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Airbnb Inc. | 8.74% | -10.04% | — | — | — | |
| Booking Holdings Inc. | 3.02% | -18.71% | — | — | — | |
| Chipotle Mexican Grill Inc. | 1.76% | -1.21% | — | — | — | |
| DoorDash, Inc. | -43.06% | -25.88% | — | — | — | |
| McDonald’s Corp. | 11.51% | 17.04% | — | — | — | |
| Starbucks Corp. | 1.79% | 3.31% | -8.28% | — | — | |
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 × -3,791 ÷ 4,110 = -92.25%
3 Click competitor name to see calculations.
The financial performance between 2018 and 2022 exhibits a stark transition from positive value creation to significant value destruction. While the initial period showed growth in economic profitability, a severe contraction occurred starting in 2020, characterized by a precipitous decline in both top-line revenue and the ability to generate returns above the cost of capital.
- Economic Profit Trends
- A period of growth was recorded between 2018 and 2019, with economic profit increasing from 377 million USD to 1,069 million USD. However, a sharp reversal occurred in 2020, where the figure plummeted to a deficit of 4,047 million USD. Although a slight moderation in losses was observed in 2021 at 3,243 million USD, the trend regressed in 2022, with losses widening again to 3,791 million USD.
- Net Revenue Analysis
- Revenues remained stable between 2018 and 2019, hovering around 13.7 billion USD. A critical collapse is evident in 2020, with revenues falling to 3,612 million USD. A marginal recovery was noted in 2021 at 4,234 million USD, followed by a slight decrease to 4,110 million USD in 2022, indicating that revenue levels have failed to return to pre-2020 benchmarks.
- Economic Profit Margin Volatility
- The economic profit margin transitioned from a positive 2.75% in 2018 to a peak of 7.78% in 2019. This was followed by a catastrophic decline to -112.03% in 2020. While the margin improved to -76.59% in 2021, it deteriorated again to -92.25% by the end of 2022. These extreme negative percentages indicate that the operating returns were insufficient to cover the imputed cost of capital during the latter three years of the period analyzed.
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