This Is One Incredible CEO

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The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out CEO gaffes and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here is last week's selection.

This week, we're going to turn our attention to casino and hotel operator Las Vegas Sands (NYSE: LVS  ) and its highly philanthropic CEO, Sheldon Adelson.

Kudos to you, Mr. Adelson
Vegas tycoons are rarely lauded for their business approach or their philanthropy, but Sheldon Adelson is clearly making all the right moves of late.

One of the biggest success stories has been the overseas expansion of previously domestic casinos and resorts -- specifically to Macau. Wynn Resorts (NASDAQ: WYNN  ) was the first to make the jump, and it enjoyed incredible success among high-end customers; in recent months, however, that hasn't been the case. In its most recent quarterly report, Wynn recorded a 3% decline in Macau revenue as VIP table game turnover dropped nearly 7%. Wynn has suddenly found itself on the defensive as Las Vegas Sands' Macau properties are raking in profits hand-over-fist.

During the same period, Las Vegas Sands reported record Macau revenue, with net revenue at the Sands China increasing 48%, net revenue at The Venetian Macau climbing 10%, and net revenue at the Four Seasons and Plaza Casino jumping 37%. One of the reasons Las Vegas Sands has remained so successful is its emphasis on appealing to a broader base of income earners. While Wynn tends to draw only the most affluent, Las Vegas Sands has been appealing to a rapidly growing middle-class in China.

These results are far and away better than what any other Las Vegas strip-based casino and hotel operator has reported recently. Caesars Entertainment (NASDAQ: CZR  ) , while a popular stop for me on my Vegas vacations, has no resort exposure in Macau and has struggled to grow given the incredibly slow rebound for Strip-based casinos. Caesars' latest debt offering will push the company past the $21 billion in net debt mark -- a figure I find completely unsustainable over the long run. Similarly, MGM Resorts (NYSE: MGM  ) , while having some exposure in Macau, is still heavily tied to the fortunes of U.S. gamblers. MGM hasn't reported a non-adjusted annual profit since 2007, and, with 65% of its net revenue tied to slow-growing domestic markets in the third quarter, that isn't likely to change anytime soon.

A step above his peers
In addition to appealing to the mass market crowds in Macau, Adelson's Las Vegas Sands offers a few other perks which make him an incredible CEO.

First, Las Vegas Sands is doing a great job taking care of its shareholders. Last year, Las Vegas Sands paid out a $0.25-per-share quarterly dividend and doled out a $2.75 special dividend in December (as many companies did). In late January, Las Vegas Sands noted it would be boosting its dividend by 40% to $0.35 per quarter. This is important because Adelson owns 52% of the company, and a boost in his pocket means a boost in shareholders pocket's as well.

What makes Las Vegas Sands a truly remarkable company, and Sheldon Adelson an incredible CEO, is the amount donated back to the community. Las Vegas Sands has multiple partnerships through its Sands Foundation in Las Vegas, Pennsylvania, Macau, and Singapore to help raise funds for educational and health purposes in the communities that it operates. It also, through the Sands 360 program, does what it can as a corporation to minimize its impact on the environment. 

Although I rarely highlight individual CEO contributions, I think it's worth mentioning that Adelson donated $143 million of his personal funds to charity in 2012, according to the Chronicles of Philanthropy, ranking him the ninth most philanthropic person of the year. Of that, $67 million went to their self-named medical foundation, $50 million to their self-named educational campus for construction costs, $20 million to the Birthright Israel Foundation, and an additional $6 million to various Jewish educational and senior programs.

Two thumbs up
Adelson may not be everyone's pick for an incredible CEO because of his enormous personal political contributions, but it's clear that Las Vegas Sands is making all the right moves in Macau and it has its shareholders' best interests in mind when it comes to its dividend payouts. Furthermore, Adelson has made it clear that supporting the communities that Las Vegas Sands operates in is not optional. Adelson's philanthropy and the fact that he lines his interests up with those of his shareholders makes the Las Vegas Sands CEO absolutely incredible!

Do you have a CEO you'd like to nominate for this prestigious weekly honor? If so, head on over to the new CEO of the Week board and chime in with your fellow Fools on who deserves some praise. If you don't have a nominee yet, don't worry; you can still weigh in on other members' selections

Has Las Vegas Sands supplanted Wynn as top dog in Macau? Find out now!
For many companies, successfully capitalizing on a booming Chinese economy is like winning the jackpot. That's indeed the case for gaming company Las Vegas Sands, which made a big bet on Macau gaming about a decade ago that's paid off in spades. The company is now looking to spread its empire further, but will it be able to replicate its prior successes? Learn about all these opportunities, and the risks they pose, in our brand-new premium report on Las Vegas Sands. We're providing a full year of analyst updates to go with it, so make sure to claim your copy today by clicking here.

Read/Post Comments (3) | Recommend This Article (2)

Comments from our Foolish Readers

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  • Report this Comment On February 14, 2013, at 11:09 AM, Intidesi wrote:

    Most of his philanthropy contribution is toward a particular religion but not for people in need.

  • Report this Comment On February 14, 2013, at 11:09 AM, spokanimal wrote:

    Nice piece... but I would argue that Wynn was not the "first to make the jump" to Macau.

    Wynn received one of the first 3 gaming licenses in Macau following the era of Stanley Ho's monopoly last century (the other 2 being Mr. Ho and Galaxy Entertainment). Soon thereafter, however, each original licensee was allowed to sell a "sub-license" to their concession. Ho sublet to melco, Wynn sublet to MGM/Pansy Ho, and Galaxy sublet to Adelson's Sands.

    True to form, Wynn dilly-dallied around while Adelson immediately went to work building Macau's first Vegas-style casino resort, the "sands Macau". The Sands Macau not only opened almost 2 years before Wynn opened any resorts in Macau, but it was so successful that it actually paid for itself in only the first year that it was iCn operation.

    So yes, Wynn had the first concession, but Adelson beat him into production there by almost 2 years.

    Cotai is the same story. Wynn originally snubbed Adelson's proposal to jointly build there back in 2003 so Adelson went it alone... opening the Venetian Macau in 2007.

    Today, as Adelson's Sands cleans up on Cotai and dominates there, Wynn has been scrambling to get approval to build his "off-strip" resort there.

    So I while Wynn has proven to be quite the "design" maestro when it comes to building casino resorts, Adelson is clearly the "visionary" when it comes to knowing where the growth and opportunities are...

    ... and Adelson's "time-to-market" accumen essentially mops up the floor with poor Mr. Wynn.


  • Report this Comment On February 14, 2013, at 11:07 PM, blueglass316 wrote:


    You are correct LVS built first Casino in Sands Macau 2004. Wynn Macau 9, 2006 and Encore, Macau 2010.

    Sheldon Adelson actually created the land, he had

    the Bay between Coloane and Taipa Island filled and he named the area Cotai Strip. 2007 he built the Venetian, Cotai Strip, Macau, the largest inhabited building in the World. The casino is also the largest in the World and the Paiza Mansions (for invited guest only) and 4 Seasons Hotel, Macau. 2010 he built the beautiful Marina Bay Sands in Singapore, three 55 story sloping towers with a Sand Sky Park set on top of the 3 and an infinity swimming pool that seems to flow over the building. 2012 Sands Cotai Central which includes many hotels. All Las Vegas Sands Hotels are suites except for the Marina Bay in Singapore and it has rooms and suites. Each a luxury integrated resort, malls, restaurants etc.

    You can see each on their web site.

    It is so very wrong that Wynn carries the High End

    people. All Las Vegas Sands buildings are perfections. Evidently Wynn has a better PR person. Adelson owns 52% of LVS. Steve Wynn

    owns 9% of Wynn Company. Check SEC and you

    can see. Perhaps I forgot some properties in Macau. Venetian and Palazzo, 1990 Sand Expo Convention Center in Las Vegas. 2009 Sands Casino Resort,Bethlehem, PA built in the old

    steel mill. I have been a shareholder since my first night in Venetian in Las Vegas the first year

    it was built.

    So often they get LVS and WYNN Wrong. I don't know if I have enough room here but would like to

    mention Sands Foundation. (No I have never met or spoken to Sheldon Adelson nor his wife.). It

    concentrates on assisting youth, promoting Health, aiding Wounded Veterans and expanding

    educational opportunities within local communities. Supports minority communities and

    underprivileged areas, programs and activities that aim to encourage and educate in the communities in which the company does business.

    I could tell you run into the misinformation about

    LVS and WYNN too.


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