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CZR Caesars Entertainment

Participants
Joyce Arpin Vice President of Finance and Assistant Treasurer
Mark Frissora President and CEO
Eric Hession CFO
Carlo Santarelli -
Dan Politzer JPMorgan
Cameron McKnight Credit Suisse
Shaun Kelley Bank of America
Thomas Allen Morgan Stanley
Chad Beynon Macquarie
Harry Curtis Nomura
Robin Farley UBS
Jared Shojaian Wolfe Research
Call transcript
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Operator

It is now my pleasure to turn today's webcast over to Joyce Arpin, Senior Vice President of Finance and Assistant Treasurer. Joyce, the floor is yours.

Joyce Arpin

Good afternoon, and welcome to the Caesars Entertainment third quarter 2018 conference call.

Joining me today from Caesars Entertainment Corporation are Mark Frissora, President and Chief Executive Officer; and Eric Hession, Chief Financial Officer. A copy of the press release, earnings presentation slides and a replay of this conference call are available in the Investor Relations section of our website at caesars.com. file prior earnings call, in release X-K we'll that copy furnished the note and the XX-Q. of to also please to we this a form Also, Form our the SEC

we slides through Harbor reference disclaimers underway, you statements, of definitions include X would to X, like Before remind get certain to and forward-looking which Safe I non-GAAP measures.

Act. include forward-looking the Litigation Reform by statements Private defined will as today comments Our Securities

to unanticipated update may hold those Forward-looking projected weather other our our obligation impact we as including with disclosed are have There may we today's unforeseen results circumstances filings of in statements fluctuations, due those and results. not control. revise statements do to uncertainties, date or or differ reflect risks expectations in that forward-looking from Actual and SEC, certain our them. that the no materially any

Operating addition, CAC, October Caesars XXXX, and on Caesars CEOC, Caesars In Company, bankruptcy completed with Entertainment emerged from X, that merger date. Acquisition Corporation Company, Entertainment or its on or

current stated. QX otherwise our versus in year, unless the include results and but XXXX Baltimore We CEOC results in the both Enterprise-wide Centaur results include quarter on third closed Baltimore Horseshoe of holds-adjusted QX the Centaur quarter years include XXXX. include exclude Centaur the not U.S. in of reflect Baltimore in but and the acquisition Therefore, in GAAP in expectation. and results include XXXX. in the year XXXX the of of Gaming prior QX third Enterprise-wide XXXX, do CEOC the deconsolidated in Horseshoe hold also Horseshoe

XX. turn and call turn X. GAAP to over reconciliations slide to find can non-GAAP now figures Please of the starting Slide Mark. will You I on

Mark Frissora

Thank you, Joyce.

CEO during company accomplished that has their that I company to stability in discipline particularly read the transition. the we've February entire about transform team afternoon, press very to on and focused Caesars be to and management plan grateful operating your our X. the leaving future. together we on the team optimistic since period. accomplished announced this of serve the to what given this been during as I'm and It's all maintaining that efforts very of honor XXXX, I will of remain an most for release proud As our company's

items, year-over-year was now billion, So turn performance up we a our to for the We very City. Outside performance realized primarily the despite excluding Atlantic XX.X% nearly comparison. competition reported enterprise-wide very and an Atlantic prior Atlantic and X.X% of portfolio, increase other of a increase strong adjusted we'll year City. our regional across $X.X this increased versus our due Vegas, the and the unfavorable XXXX, consideration, from quarter Taking Note items credit expectations headwinds which into despite also benefited these results. including diversified The strong from our debt a and we X.X% pleased to operating challenging quarter Las Las of in U.S. properties, revenues that Vegas City hold QX had in revenue Centaur and in acquisition a are we EBITDAR very in had third this and expense favorable bad quarter. with we quarter. increase

debt as $XX of declined increased million higher impacted year-over-year to in unfavorable well $XX operational regional normal attributable the soft Vegas, X.X%, fell prior Las the by in impact million acquisition adjusted in period, would continued of portfolio our Centaur demand. demonstrating been the year-over-year. have momentum million growth efficiency expense Adjusted resulting EBITDAR in of X%, collections to strength than the and In broad-based efforts. bad X.X% as Excluding year hold $XX and Atlantic City, our EBITDAR across revenues

these for by XXX compressed Vegas. remain Adjusting As Vegas EBITDAR flat margin year-over-year. adjusted result, adjusted Las a points Las two EBITDAR factors, basis would in

business EBITDAR well million, million Vegas Our calendar-driven Hold-adjusted the EBITDAR and to execute down was of drag from softness despite X.X% Enterprise-wide headwinds. $XXX in as ability $XXX a City. these Las our declined of as model X.X% Atlantic results strength adjusted validate driven by year-over-year.

geographically described on Vegas a Las basis. performance was continued results As schedule and mix of lighter Vegas quarter on our and call, in the operational reflected target we our focus of and last for our quarter excellence markets benefits the the City. Atlantic our quarter was our enterprise-wide meaningfully regional and said, third partially that the quarter With softness aspect this record year-over-year a another customer was Las in XXXX a diversified in on of gaming as network offset

Our enterprise-wide third an anticipated all-time basis EBITDAR and record to compared period. in year-over-year. points our XXX regional volatility to just business represent well Las of drive face Marketing $XXX we demand the adjusted and $XX remained sustainable proud jurisdictions. level. to than of cost efficiency EBITDAR in our quarter. revenues, of over Vegas. the softer in reflecting adjusted quarter by below marketing prior point most $XX a efforts value. was to business, the We basis remain Year-to-date XX.X% cost long-term improvements domestic Las on focused manage We third million growth year company's key margin priorities I'm margin XXX our market focus the in in on now quarter. shareholder year-to-date, XX% domestic normalized million Vegas execution and Hold marketing gross strategic declined reduces while our share of reduction executing million quarter-over-quarter the Despite holding

acquisition U.S. XX, Las demonstrating in flows progressing way. New back assets brands strong repurchases we many November sports which or grow on There excluding our challenges Despite of some increased offerings wins. the to very betting a Jersey. XX.X% were too, We quarter We impact declines despite pace we RevPAR historical improve investor and occupancy by our important through we share we of already Centaur Centaur Within Hotel through this quickly new We in X%, shareholders QX. year-to-date. the in organizational of is was Mississippi Eric on competition RevPAR City. in to Regionally, than the of trends utilizing Caesars the EBITDAR we to Atlantic have based capital-efficient came casino in in million margins strong had $XXX Atlantic and revenue closed City. successfully growing call. recent open discussed we our the And to database. were managed quarter, leverage quarter, other had on and sharply performance schedule. softer EBITDAR ability Vegas returned results and and cash actions Vegas cash integration and September. the in in and We deteriorated Casino Las Dubai notable in the demand in the below well in plan quarter, When enterprise-wide adjusted took of in our in launched and to with and the July several EBITDAR in will we were the later fell off Demand surprised Las September, end half expectations. discuss events. dropped anticipated how second Vegas our ahead demand

strong our third was prior discussed momentum temporary early in And the that Atlantic City Vegas we quarter seeing call. we Las impacted in already into and are and increased indicates the quarter the quarter, on softness earnings competition were XXXX. as fourth by in analysis bookings for in Our

updated We hold-adjusted increased We're we full to potential of and on groups booking growth and the of $X.XX hold-adjusted the remains for As hedge quarter improve billion any to Vegas. with between also $XXX more or quarter implies rooms enterprise-wide EBITDAR results which implies demand. Slide a reflecting X% expect and which in and you and year, X, Revenues leisure late will softer-than-expected billion X% million billion, fourth from to booking and billion the gaming will outlook respectively. $XXX of X%. window, our million hotel quarter $X.XX year-over-year to expect $X.XX approximately strong citywide enterprise-wide to X% business group due growth EBITDAR against in customers XX%, see year-over-year volatility of revenues revenue revenues solid, approximately to the fourth haven't casino We our year the X% guidance $X.XX year-over-year. early in still and filling hold-adjusted in-house our third full in now for

Las same negative as October the XXXX. time the now, of XXX,XXX nights room tragic of of have an time. last the quarter to fourth the of versus million a we X, approximately a on in additional on $XX Also X% total Vegas year, increase XXXX we this the As had impact EBITDAR quarter event reflecting books fourth due in at reminder,

We 'XX. million in QX versus hold expectations also had unfavorable $XX in

of million renovations. quarter City to expect to adjusted market U.S. the have the regions, there. in we XX,XXX the impact to due we roughly on in room increased budgeted $XX Finally, nights In other capacity EBITDAR Atlantic due fourth approximately year-over-year

other quarters this the first first, adjusted EBITDAR with the we In and $XX other remain peak seen all consistent We a in year. have segment, period half with impact stable the third EBITDAR remain are All the decrease maintaining revenue in quarters X line million the and and our the expect of areas of year. to year. for of second second adjusted since this

to long-term. Let's sustainable have to over Slide across allocation capital in growth made - a our we the a the in debt results, we disciplined repurchases. and balanced strategies move progress properties, from we're taking right drive We're and reduction, in the creation across to approach M&A further Taking confident X. our on the back share initiatives investment step place investment value

areas betting versus and and meetings. as with We we're footprint acquisitions are opportunities asset-light corporate expanding our product we sports in and areas like licensing our peer broadening such where offerings accretive under-index

over premium visitation continues Total operate, of and assets. cross-property making Rewards an advantaged fair acquirer with Our a drive share regions most us members, industry-leading XX revenue to million regional we now in where program,

our valuable investments marketing company to strong the allowing and drive in XX. increasingly from technology returns Slide our On customer in us us draw generate Our insights have core the investments business. growth across database, helped

and Centaur to that we database is through at The at our the Total the those accelerated to Our drive M&A. Rewards and the month improvement future realize Centaur expected efficient occur which to traffic operational results our ability our can power and thesis full turnover efforts for this synergies excellence synergies utilize scalable have of model validate and properties. continuous to our operating of systems,

will Centaur properties worth we proceeds these that the also sale in project we funded million Harrah's Properties. X of of Las the purchase assets at part to to estate EBITDAR reiterating in It's that $XXX drive of VICI full real Vegas our continue years. from of the We of

the approximately games. table be post-synergy OpCo be to in shown table, we X.Xx reduced introduction our multiple to further and of the to X.Xx As anticipate effective upon

as advantage as you unique competitive Entertainment's future the continue to betting. we update platform towards Caesars integrate the will look is sports XX. We we a also of Slide properties. key

customers increase addition of operations a new partnership with XX% a gaming at increase and quarter, and bars, the New New betting products. betting the caesarscasino.com, saw bonusing in in and traffic bolstered located to marketing we sports in During and sports strong to properties. adjacent saw launched with in September SG restaurants a and recently larger in Total is revenues Digital offerings guest sports Jersey Gibraltar. features Rewards and XX% our added Mississippi, integrated team launched app We which which fully as a between the We mobile app Jersey, played XX% which with

and Book, Las With Vegas, period on book, and which beginning been traditional drive And November. increased XX betting such believe to states October volume sports brands, more distribution from to strong sports F&B we the has We in revenue states. initial expect in year. we double in social uniquely as The the launch initial prior these as other we're at across model, expands and in received we yesterday driven modern technology has partnerships due to and received an the investments opened positioned well take Pennsylvania, the versus to license LINQ where a our actions, compete footprint

betting component future. our business in We of expect the overall to become important increasingly an sports

teams high-level partnerships of efforts to broad-based fans, recently pro sports sports announced we and profile with part venues. several our As raise with our

one corporate first sponsored the Here proud Vegas, with the in to - Raiders Vegas be and arrival. partners excited Las we're of imminent for Las we're sponsorship the

is lounge experiences branding have the home at and branding we're closely working Coast, and their to our also Baltimore, who the play from our East the Devils Ravens, relationship local strategy. and XXers the On property, our Center blocks are with In Baltimore Slide few a Prudential to XX. present all our the games. marketing national Horseshoe the of just with core and On

destination why the we opportunity Carlson areas the revenue business expand we we our corporate meetings. to This Las earlier, meetings such in According of space number Caesars meeting potential. Las There be in peers Vegas demand Vegas mentioned is great diversify will in compared hosting is currently construction into to upside X XXXX. for Wagonlit I Travel, more a get significant As under-index is with than accommodate. from and can to Forum for

incremental In investing XX% holiday at the of fact, Caesars approximately Forum expect at capacity our in We're and meeting strong Forum. outside run revenue. from development the spaces business potential weeks, we've and Caesars demonstrating capacity. Caesars adding million of the we're interest generate to additional to million upside $XXX already of say already venue at substantial We're pleased in seeing booked $XXX that

We be expect early XXXX. construction to completed in

we've our or the our X our future. Score that improvements strategies, achieved market our rebalancing the increase which right X% spend XXXX, to during X we're the and targeted in months, Slide from will X and guests customer our offers. revenue employee not primarily profitable of net customer sharpened In in reducing first decreases marketing our Net ability making experience. times, the reduce share full-time per right In service in marketing on while offer X.X% saw scores the Despite increase $XXX successful significant and scores X.X% labor domestic So operating increased by our months guests the model the a satisfaction drive from in value reinvestment cost first in a years. through at guests. last our nonaccretive have to and million, incentives Promoter the We've does we customer marketing we've Promoter the in been expenses, ensuring Net record impact XX,

plan balanced to multiple a Moving debt, and growth to maintenance our activities creating by After pursue cash using same-store and development value. cash projects, we we remaining accretive interest, and which have pursue allocation have and capital utilize rent, Slide shares. new flow disciplined we to for we approach shareholder capital repurchase XX, reduce M&A, free are to avenues

we reduce our gross neutral are synergies. We lease balance the any deployment. anticipate and our target important provide or be committed leverage opportunistic price We deploying X.XXx our remain to deleveraging and dry are Debt will the that we continue undervalued to per million million authorized this Importantly, acquisitions derisk leverage $X.XX for $XXX program attractive, yield to share better of under our even suggest financial at if time will uplift, of repurchase them as to think we under believe XXXX. end priority the the an be sheet powder value shares there make are worth may by undervalued adjusted gross to we current to will are alternatives. X.Xx $XX of That shares our authorization. paydown able but is they and remaining is $XXX what post our consensus which

EBITDAR capital Thus, varying conditions growth we be will to as evaluation. We flow and dynamically sustainable dollars those through cash focused allocation multiple of are well to responsive in priorities about economic value generating ship on market our and incremental per multiple free as share expansion.

we'll an we're efficient the value. aspirations and tool are our to focused more be we now disposal source to We'll increase trading us accretive updated on Eric expansion keep Sale-leaseback debt the detail. call in financial context value you capital and evaluate our to the shareholders. results deal, They be all Centaur as for strategy. saw opportunities multiple most opportunities Given finance our and I'll with available value disciplined currently of turn can our over can another create review the drive and are in reduction to for other creation long-term to you the our to at on used sale-leasebacks of seeing, continue M&A opportunities. to and

Eric Hession

Mark. you, Thank

or like Before the on our XX I'd and of to on I details discuss decline detail Slide X.X%. drivers results, specifically $X our RevPAR QX to start discuss RevPAR the segment of

is to events the waterfall rate demand due the in occupancy in As leisure weaknesses driven you the segment citywide primarily in by weak see RevPAR year-over-year. to chart, fewer lower attributable

leveraged associate large fill customers. we we improvement travel to demand, time of this September database with a benefit the term, In with negotiated response negatively Because this loyalty gaming we the online In inventory weaker quarter. our most key to the casino unexpected but for as off agency leisure impact but terms, lead long of well. the rooms QX will better RevPAR of we contract addition, EBITDAR positively which saw some took strategy, as affect impacted, in

In addition, a of $X.XX. positive RevPAR annualization impact also of on about resort fees had

third Slide in XX, results detail. to turning let's quarter review our the for more Now

includes commentary results. our in Centaur excludes past, year. the included results third in prior Baltimore is Horseshoe quarter Starting the CEOC in As from but quarter, our

year's Las by hold anticipated volumes, versus a unfavorable Mark it in given than First lower quarter weaker driven primarily noted, comparison a and as lower Vegas, occupancy and casino was difficult challenging revenue demand lower soft, very last period. Las in Vegas event the robust results totaled rates $XXX calendar. Hospitality million, versus by segment. down occupancy year leisure prior the driven net were X.X% Overall,

overall as lower result, Gaming ago, also last versus due softer a X.X% room in noted expected, X.X%. fell Vegas was unfavorable Las in and a revenue from year fell volumes results X.X% RevPAR to Vegas As down X% and than Cash were Las year. Las Vegas down ADR hold. cash

RevPAR EBITDAR adjusted year Atlantic versus due Revenues City use segment. by segment, our Turning say indicators and at In expense corporate credit a negatively than to other in to flat, remained our is insurance we competition results due to areas, XX EBITDAR the the slower while last year-over-year strength assets CIE We prior our City. quarters. due costs our XXX year-over-year international, and reserved. one over the impacted hold-adjusted EBITDAR properties by of the impact managed, our versus higher points X.X% in IT we provided Atlantic to decreased all corporate million The acquisition appendix. $XX in of approximately million which ago. RevPAR Strip growth to normal includes that $XX of XX.X%, lower grew leased essentially have outperformed to pleased X settled broad-based progress. revenues significantly the breakdown and an large by to our of by driven that and owned grew U.S. claims regional a in regional many adjusted Centaur year the of primarily period outside measure We're average than related peers basis

into fourth solid Las Vegas Competitive we're the October. as to head RevPAR particularly many we by seeing As for growth, dynamics quarter, it's in us RevPAR difficult in forecast make influenced factors.

fewer the operate we to the factors. than rates leisure in XX% due Strip and even our The of of percentage by - sell our Therefore, database rooms sell are affected we competitive rooms on segment. lower First,

our be Because soft Second, X to a has of this our approximately nights customers volatility of Las our policy RevPAR The our comps market. the more this comprised are revenue January caused impacted comp of chart our be discounted. negatively and shows dynamic, RevPAR. of in XX% of room determined component of on page recognition discounted this rate. are year, month-over-month bar a rates room become Vegas volatile by leisure Effective and casino changes of can the our right-hand to side

of EBITDAR is goal performance. value that measure create important is shareholders. most believe Our value end, that our enterprise-wide for adjusted we shareholder our to - the To

to may reasons has actions factors take other at the and the times, improve metrics RevPAR. many we mentioned, For at expense of RevPAR influencing

for guidance benefit each stop disclose the and we've continue course, RevPAR of forward So the decided will, to community. of quarter investing RevPAR providing results to going

you cash walk I'd XX. debt, our position. - through and Slide liquidity to to Turning like you

of $XXX CRC $X.X capital Cash driven approximately ended drawn the revolver also we Flamingo. renovations we ongoing totaled in project million of quarter, currently is Both with enterprise-wide, have balance on at cash million our As our reflected revolver. room and billion in the refresh in cash $XXX purchase the quarter second expenditures in phase the by Centaur.

is adjusted cash swaps, the new Excluding payments at last X.Xx quarter, floating lease another net Recall at new outlook our EBITDAR for traditional leverage our and expected stands leverage and Xx on adjusted at to executed our our net we convertible capitalizing fixed our $X EBITDAR. note shareholders to through We this period. repurchasing approximately back of billion Xx, $XXX September time, appropriate XX%. of million this starting fixed shares through is the ratio our of XX XXXX believe XX, variable-rate shares. mix through buying we At million Through returned quiet the value and approximately midway quarter in stopped debt. and company an to increasing

We attractive are shares back believe of buy are shares we plan use their allowed. to opportunistically capital as and continue to an

provide an illustrative to rate integrated discretionary year about years. view generate full lease cash we'd plus cash to adjusted maintenance after of fully CapEx, interest in the to discretionary XX, we'd expect our midpoint for payments slide coming our the Turning expected guidance of the flows you like $XXX and EBITDAR million Taking flow in Centaur, expenses. run

cash healthy enable will M&A disciplined Mark expect and to flows, us continue capital core repurchase business, which strategy. our according allocation We to pursue leverage, our to our explained, reduce in shares invest as

turn for I'll back Now comments. some to it closing Mark

Mark Frissora

Slide a On Eric. lot, Thanks XX.

Forum, So and at outlook Caesars specifically. development CapEx we for into XX, Korea range renovations. to $XXX CapEx at our full Forum our to was that slightly which coming note year at $XXX guidance with The to lowering from XXXX. is XXXX are Caesars room million, includes Slide million includes moment, $XXX quarter Development shifted fourth million, $XXX to our Centaur the integration. the as which turning CapEx spend a same-store more million back lowered

indicators the history time I room in we're important growth of and seeing solid on VVIP are year In our in same seeing the and the October, monthly the in We had all last additional casino we we of VIP company. As one highest the performance. books revenue mentioned, of hotel Las momentum Vegas. segments, nights versus good XX,XXX generated results

leisure room we nights, reduces gaming reliance is significant competitive advantage database distribution the can model and unique that use on increases to Total which in Rewards our segment. Our casino a drive

healthy. nights is January target XXXX, time already same XX% for in-house in room Overall the business our books further for by of the groups. our XXXX We up booked XX,XXX room nights year. approximately are Looking to versus out have last

of Vegas ADR to Bluewaters second focus the our and our gradually initiatives. towards we key months light since continued Vegas expect To real shareholders the We're confident Dubai CEOC's we strategic branding Las our generating expanding development, on quarter. In in to licensing there and investments operational some Buena disciplined from as MNA, on summary Slide asset a and focus through fees Vista, objectives. Caesars well continued in opportunities the bankruptcy, is in have and emergence growth Las We capital fully discipline. remain be recap, through Entertainment with will value as growth a of progress XX while positive opening network international and cash operational flow On shifting accretive XX, strategy. Caesars estate delivering margins, on growth focus development long-term

is our emerging new out also positioned in betting well sports capitalize and to including on business core where have attract prioritized Caesars We investments gaming to building our demographics trends, in extremely U.S. business innovation compete.

ready forward manner. a focused path the growth value. executing clear a are disciplined sustainable line positioned in bottom-line open In at we the executing of generate and We successful set we our execution these out initiatives. emergence summary, disciplined plan top- to now on creating and growth We're are Q&A, that operator. on We have to successfully up against for through and shareholder significant we these well remain to areas

Operator

from Our comes Instructions] question Carlo Santarelli. the of first line [Operator

ask may question. your You

Carlo Santarelli

until job present. great the up company the a bankruptcy the through with on Congratulations

- around those comments, open. addressing and little some Just when some RevPAR be of changes as guess, you're in timers obviously, the you in of Eric, bit changes of commentary terms as But get the of of as parts Center nuances the there and Las business serve the Caesars headwind growth? the little a group well to some business there made of the of couple more bit your XQ could will - that I about is to a a the obviously, come from and all the of of just on maybe I guess, of you and little way one of that FIT the together do Convention a wholesale how on Vegas, you the talk some that's were kind of com bit moving some

Eric Hession

at a quarter, the demand few the As third the falloff we surprised mentioned of leisure that were we conferences segment. in pace the investor clearly by throughout of

database of customers. largest effective is the terms advantages have. sizable One being the we when competitive most out able And to months a of that is those our ahead to used looking database in market few

So the middle his in did bit third of mentioned as we a do tried Mark that the to And we affect quarter. in month. the little notes, of September

However, we even backfill occupancy weren't fell and into with look unfortunately, When year, customers. able quarter, to overall our we utilizing into because has next fourth casino effective. those the database been very

year prior on of those nights half segment. the the point over this We to the are more at period compared room casino and have from XXX,XXX book

with So regarding that us of the is providing optimism quarter. strength certainly the

revenue best the company. where finished either the of history we as month the or October hotel second month October the addition, we In finishing the saw in ever best

And as group is also demand we the then strong. So quite quite well. up seems XXXX, head into the quarter fourth shaping

well percentage books, Las market. We rates that the on rooms have already at over Vegas significant and of XX% further the solid the would strength anticipated they're indicate in

Carlo Santarelli

on And works influence, the report you mentioned, impact, optical customer correct? as that way would negative a casino obviously way obviously, the RevPAR, have Eric, accounting just the that you'd given

Eric Hession

changed nights we this the at nights the one year, was of room segments. discount of recognition the the so beginning a room casino at book casino Yes, of way revenue to because our transient

occupancy, does that it trading segment, casino extent trade-off segment, the decline. result, it To side the from when And but we're making rooms so a it that cause if good ledger, down to are would RevPAR. be the rooms, would a it that of as you're we actually casino drive to increasing

calculation, case, QX, revenues with provides to pressure that this obviously customers. but of in than period renovations, prior the XX,XXX incremental more RevPAR filling rooms we the rooms on schedule due approximately in sell the addition, available downward by year also have In the have opportunity to in profitable which did certainly an to we

Carlo Santarelli

didn't just debt Mark, could was remarks, acquisitions your on also a estate then an strategically. Would and follow-up. I you M&A M&A obviously, forward where ask real paydown be a little about And In focus, scenario going one one you the transaction but of bit mentioned capital would a there uses that embark if guys and partner? talked you of involve

Mark Frissora

that, don't answer, I let I Why guess. ahead? general, go in think I'll Eric you

Eric Hession

hate transaction of say to would I say And make regional of to the use I'd unlikely. might estate estate in size capital, to would partner. a tuck-in other size any the our very not But of given real needs that talking it markets, a about certainly be real transaction. the Yes. a it's we're acquisition if be could applicable never. sense it

Operator

next from Politzer. the comes Dan Our of line question

You may ask question. your

Dan Politzer

And to when want I a externally, think first. the the line guys you on the search for are be time guys have that How So going a hit of guys candidate? filled? you seat you about are change, you could potential change And CEO do looking internally?

Mark Frissora

X I yield it candidates obviously committee on don't committee, I can months, an the and external search or away and consultant could think take right that we Board, have the know. months, a X process they've engaged

want And you I doing, ensue that to We're move us in real as know quickly we're that allow is forward how internally, can a than obviously on. someone we just what about can. to We don't very will variable. as externally. way we know, find looking will seamless do all speculate and obviously As search it that other again, stating and that's

Dan Politzer

the your line approach the just change headlines does company, time regarding And given on to mean, M&A? the recent vacancy M&A or I

Mark Frissora

- a got we have within Board. the active we've think, I different No, very committees

acquisitions active down slowed hasn't We that all our that all. an at process have committee of and looks at

And so there I If it. something value, think delay. don't anticipate that we value, will is very quickly we or any move creates shareholder

Dan Politzer

of peers you we terms strong industry October relative forward then, performance And Las the your talked in Vegas. your going in think guys about lodging, your general? The on about should and How in trends Strip to

Eric Hession

renovations reported little that Strip Vegas generated LVCVA outperformed deck Las in the we've included a by the a the The for to XXX of our the also we largely about by have way by we Dan, due the model change the those undertaken. business done have that points RevPAR X Yes, the over covers that's with basis quarters. end believe year. of about we've And earnings We XX% that room that, year-over-year. average in and on and the slide that compared We're to

continued anticipate be back returns think that and to of some I after would diminishing So heading diminish, I expect that get otherwise but level that into should reasonable get outperform performance The all point, our at, up heading At next to outperformance. some they will would so Strip. you rooms continued XXXX, would eventually it's the year into

Operator

of comes Suisse. of Cameron the Credit line McKnight next The question from

your You question. may ask

Cameron McKnight

the tough So we mean, first of Mark, I spoken about all and of Strip, all, that. in lot third have know terms written quarter of words The was a been and

a Looking the genuine was of forward, changed anything think third second or since one-off quarter quarter or Or outlier? do the this quarter year? has you an first the

Mark Frissora

that the then has we've been but a only for that that the surprise in September, much everything drop seen us normalcy. saw that return a since pretty was think precipitous thing I to we that was

So we in terms bullish. of Vegas remain the business forward, going model looking at

Cameron McKnight

expected city the talk first to of you fourth those convention might the next about could you attendance year? expect periods? quarter attendance in for the wide up be half magnitude and And And which

Mark Frissora

the October previously citywide did and that ever one I months in of attendance the know at think, the will and I like revenue remember of if the XXX,XXX this right, they you particularly to seen was this look year, October, went citywides, XXX,XXX. year in fourth hotel we've was, of last highlight be we've up the October October. I from you year, something in We when revenue reported probably that month quarter for in best for

So then in other we terms And of is of demand November and well, think XX,XXX. we saw citywides, positive saw in as that evidence roughly that October. I

down weren't I wrong. because correct think December, if can as events you in citywide there really any of I'm ago, me Eric, still of being December but at a up ends on least year last weeks citywides, couple

Eric Hession

that's I right. Yes, think,

Cameron McKnight

in in to And taking to some renovations you're extent Las terms you and common the some share on you're The Strip, think areas properties finally, of do the that room then Vegas? renovations at of making

Mark Frissora

- generally don't I month, Vegas. don't it I think at have neutral know up And know I day through Every in a we at the September. least or what positive. flat to basis, fairly speaking, to share least month were we flat, but I know been at on were numbers looking on that yesterday. We

well. doing we're So

taken time. an kind will got your of could trends a what of I based to of that's in it seeing the be one share in could on is, market we've And think, but look occurring share, on, of even had last have of play, month, we're event think trend past, we've facilities, years. see similar you it kind it over over be at be the seen that time, three One you've share, I we at that the based blips kind over baccarat here quite now. the bit

customers reinvestment that either a to we're we able in by to hopeful continue increase that share as to will precision-oriented less So with flat way our continue targeting more it reinvestment. reduce or be keep much

Operator

comes Our of America. Kelley of Bank from line next Shaun question of the

ask may You your question.

Shaun Kelley

maybe one one. detailed more and big Just then a one picture

can about option big know and and the of to question may lot not things to could media are these is may what a just forum, it structures the been going the there's a are can consider? there picture difficult relate off any reports consider. company press as forward that the it that of give if or sort So I just public options strategic sense larger be, really speculation a scale you kind of of looks you these table perceive in on that would guys of but comment would some necessarily at us how company

Mark Frissora

question, good to regards I so. question, it. on Unfortunately, the M&A, appreciate can't a we've answer with It's Shaun. a I though. policy we got Wow. just comment anything can't

Shaun Kelley

to I had ask.

let's move So on.

about in the quarter, and And side. on number side X% some with quarter, last a on would in real but the I we status Because do that roughly the the environment, there? and the sense we casino gaming the second in the hotel out customer? just What's believe see even saw quarter gaming what us strength area a trends bounce were on maybe you gaming rolling saw see how the third all a I there? that lot back? think, initiatives to side. Is Vegas you talked Las some be you're should for other The expect Eric, give the can you adjust of revenues you hold, detail. you if By down calculation, our

Eric Hession

we we that's they components as up at by which had We great VVIP quarter, did lot quarter, our they quarter. your of second well. our third we're the segments The It's showed and segments' in the head quarter, then, a In And that conference, it two grow you the We and of know in one Yes. the of two quarters as up bit. well. Those the better a you course, down. were is of August question. business periods. in key as saw Actually, see seeing slides And And key we've a on fourth down the that were gaming VIP some Strip the previewed about X.X%, revenues, second July little business unfortunately, strength We fell those had. into recall, the as off. reality.

it that of piece the into that the the well us demand 'XX. There city. as lot that coming are variety and a the a activities our business time So was hotel side it again, we gives look that we as consistent rationale is discussed of of return as on. a over confidence X-quarter But dip the XXXX belief were to that, in of forward lot from with of for in interest of going

Operator

from Thomas Stanley. of line the from comes question Morgan Allen next The

your ask may question. You

Thomas Allen

lot XXXX calendar to really shape talked for they event the just the and up market. your aggressive confidence quarter, did do Are kind thinking event way how now about more the the or why third revenues in way but didn't market city-wise, a So and seeing the that's about you conventions declined you you've of not fill around, calendar? more a more have

Mark Frissora

which quarter, third but have here. we before, the big you in that is, hit had think, was our Celine as casino one gaming said number third may Dion for quarter, think a I at know, I for which the canceled XX Palace, Caesars us performances this

visibility I be is, - wouldn't totally is not see say on. what bullish frankly, mean, are a now, what And future, I see want good. into have think for have that, in so 'XX to a far, you sure And the we which like XXXX, that far, right we that don't to visibility, Eric, to a you so we got never have own factor. the you calendar add you if lot So that robust of but was but do. anything definitely you not anticipate we a a of we lot theaters, is we're we that and that see it far, anything we of please our happen that lot able see that, we're because think know making performances to

Eric Hession

other it after in to to up add, crying whole acts just with more in we're specificity a an I'd slide like we're short lot tracking like with the at come staging notice. learnings additional backfill we actively the quarter, option lot a obviously Typically, that, has when that to in and acts bring of cancel third comedians that of don't to major acts shows shows. the one require can or

to a seen good. then ours the good of as at So shows derisk city In that shows well. quite bookings type we're recently additional fourth environment. the quarter, and drive city from the added couple trying visitation of have that the to look MGM we should We've

Thomas Allen

of prepared how the you guide some remarks. think, versus $XX your how this million third repeat, of of your year? half comments just expectation And in impact on in in are perform quarter? I you And Can Atlantic previous second your the I City did thinking that then, your about the missed

Eric Hession

altered we fourth. million $XX the in We expect believe $XX about about million impacted haven't the the by million quarter We $XX continue in negatively third and to impact. we were

period of due $XX is but a operating businesses continuing full it very the entering reflected to year guidance that's our time operators We so, cost updated impact will the try to in new in the QX million year, best and reduce fixed our low seeing our a with where and revenue of that with demand expenses makes reality declines offset the the of challenging, and market we're we projections. and lot that of two we're can,

Operator

Beynon question of the from Macquarie. of Chad The line comes next

may question. You ask your

Chad Beynon

on I congrats with to last fourth Mark, start X wanted quarter. years. the for the the guidance

You've million there. EBITDA still range out got $XX

a it was I when think in July, $XX back issued million you guidance range.

you've what really of that given risk. taking you're on details range? X, able gaming million here put of So kind to Why any provide that mentioned closer your customers, versus in that would filled if the to still much kind that the weren't November you've with in $XX the helpful. And Vegas, you we are be rooms top will bottom,

Eric Hession

the And million we It's third level. same we variance a of range by on to did reflect - reduced midpoint the the the impact the $XX we question. at approximately kept the the good range quarter of also and

able than even in we achieve the to range any of think face. in quarter to lower third range unexpected we've that you the As did also tried and can quarter the for in that ensure we headwinds the might provide see, face fourth reasonable come expectations we is a what to our we're

in yet for So strong, books well. the our through given and are Vegas we X from the October November Las month month look revenue good we closed side, here December looks as and quite haven't

we sure we for that we range that to was make enough to a conservative that So us provided wanted achieve. able just be to ensure

Chad Beynon

that then be and you've how hard talked going difficult to and about quarter X further? the that towards the How And experience fourth year? are reduce XX% marketing might the in Centaur as this I line. believe, growth growth XX% think the the flow-through think you've to forward? guess, you EBITDA in quarters cost still just X% regionals, Are year, same do to the so quarter gone it there opportunities of seen the should revenue I marketing pretty and bottom about first throughout the out with Or City, the backing comps reduction of and we or has consistent per for Atlantic

Eric Hession

are and dynamic. we which early X We're in to we year, next share well. certain hotel-comp-centric. is marketing we it's to putting marketing to year push most in a our marketing to department's success that, do great plan year able had The quarters. particularly a do. customers be next we expense our customers the able spend that those do We are heading - distinction. And We sales and target into going introduce. really that of unprofitable be could together market markets in perspective. important efficiency. pare have our the expect allow terms opportunity consistently don't reduce evaluating specific think marketing continue down either important of as really this fourth make we're this of are to to force that's effort that will our segments sure us don't across continue to back regional that, trying is what We to profitable the the part been marginally ones much that's from in, enable that that really all we'd think come profitable we're us there of where lose and we would to There can initiative, we're quarter our technologies to and number or one-to-one going in currently more have less need The and an We a marketing

Mark Frissora

studying the looking we always organizations can first which come at offers, work, is add quarter determining the a or actually Those that, The last - our in only we the December. is let's as always as year-over-year and we looking not we is the whole out with. thing a we study and said significant rougher fourth look anniversary kind mine to started that idea of initiatives. marketing year. of data keep which or to But see base, at them what We're the quarters here November comparison initiatives cuts fourth say, quarter of offers continuously three revenue amount because whether up having in But efficiency and out are, took our don't. I'll than, little that many

we're continuous constant you one improvement numbers So where effort it's not is I to prepared things of company. in the the like those on think, give but

Operator

question the comes line next of Our from Harry Curtis Nomura. of

You your question. may ask

Harry Curtis

I X have of answered. questions just Most my question. quick had been

same when think is, Turning customers weeks the higher, substantially the that do you see in what Total had about that the getting is increase it's booking in, an occupied back room so kind to don't Rewards active, September? per reason OTA Rewards, Total more to you a you revenue yourself lot of I'm comes typical into customer? total the the compared that customer you lift, Rewards to run And gap trying assuming Total asking say, profit and of

Eric Hession

that on, depends segment ultimately, letting of particular day. that the really for which we're casino it Yes, customer into

rank we spend. certain terms on depending their the customers and pay that we So of room segments worth of expected certain customers' our in on it. the amount particular let And how effectively that's or daily either have day, rate we'll yield they'll a rooms of free

have low, customers and great cash December, the value price levels The should against into nuanced or relatively So however, to as customer there's in off one are room profits drive occupied off occupancy about incremental raise a other room gaming them where we trading What both of the the sure customers profit. that particular, I Otherwise, trading of say the there. you're November those answer goal, we little will bit where make a for the same. to is, in head is casino room. are of a of because an we're those

at value resort than that typically incremental the the pay offsets clean room. gaming so, that that all the sense, of level more will to plus And is in which those customers fee, cost

very is and into quarter. trade-off approach why that we're believe profitable the fourth it leaning we So into heavily that's

Harry Curtis

resort did the follow guess, for pushback do with up Eric, you up with you would particular the question again on planners you I seen in fee on resort and So from taking meeting plan and group a Have mention I that. XXXX? that fee

Eric Hession

other cities Las whether New Vegas for convention-centric and is good Harry. When in. Francisco, how all numerous account added Typically, rate for fee include a of well It's banquet that as the locations. San typically store or a a meetings, they'll still question, York bargain, a like and other that. shop they're fees as large you great a meeting around will Boston, regardless planners like negotiate fees then and minimum to spend

see lot or package value we a as trade their So of at meeting for from because it total pushback show. planners a the don't their meeting looking they're

Harry Curtis

California? marginal Have to forth business thought you of from what degree any given kept the resort wondering drive-in fees, visitors to away? and softer I'm some have of some the parking so those

Eric Hession

at. It's something definitely looking we're

the aware well we're from demand investors' make not in need perspective fees ability inhibiting - so terms drive the that by perspective, than profit. to the watch we have losing that the of and and the incremental to sure both more perspective analysts' that we're customer we're We

is right data just that come analyzed and went to That in survey we out we that both would who inform going and part of So database. being and a of very conducted large the we've our forward. customers now customers will are visitors not use us

impacting we're in that's case, we'd something demand far, a very something up We don't seriously. So watch situation where more end our believe we and certainly don't the but and take so it's that, depressing to than we profitability intended. want we

Harry Curtis

Very Mark, on luck adventure. good. And next best your of

Mark Frissora

you. Thank

Operator

next Farley of comes from UBS. Robin question line Our the from

question. You your may ask

Robin Farley

ask. wanted things Two to I

may expense growth EBITDA accounts the than marketing reduced Mark guidance more at your addressed already. But little year bit growth amount kind have just looking for for them that a full of of your One and of EBITDA entire the guidance.

that had same-store and know, be drive what I but QX I there? QX, was put tougher it my about and know on that, then sounded may on numbers don't for didn't was, like thoughts looking I maybe of so have your I you as that else, in want question And get if And you might don't did level well. that. question anything sort so to EBITDA any anniversaries other growth to a

Eric Hession

you're talking year, about Robin? think next I

Robin Farley

amount in of Kind than other for QX would when the growth. the been words, EBITDA other looking significant entire growth? same-store expense? what happens reduction growth QX, reduction at In guidance reduction cost. for the words, more EBITDA accounts the of anniversary entire in But becomes down driver the same-store in EBITDA marketing the that or you what after EBITDA marketing your have XXXX, for in growth without marketing No,

Mark Frissora

try specific growth take it's we a game actually we can So, growth, do impact. don't to helps - overall our whether mix that that a rate lot focused whether the for more we take numbers, a improving around of expect a number of putting very gaming initiative been There's our example, hold control gaming in but and incremental organic of our this equipment we improving drive so We're We the it floor. initiatives our have have have obviously, anything have the area is we and, profitability. improving an we actually that floor, impulse-oriented same-store on year. of give some strategies the to hold,

So at terms looking that in quarter And around that in just the one and the then we'll strategies of also will how quarter. will general fourth there, want add drivers that? be of use you Centaur we're help. will the will help - incremental going to that fourth the synergies Eric, itself that to play to think, drive growth in out that I

Eric Hession

thing bottom reflect other XXX% our add, of gaming I'd expenses flow that percentage to line. is only the spend, that the we doesn't that as a The Robin, marketing

of of kind. that rounds, lot is other it's in a types It's complementaries. So beverage

need So to the adjust you that EBITDA, that notion it's XXX% profit figure. to accretive

Robin Farley

cash of just to there question but would in because or factors a QX. mentioned? change nonrecurring is rooms And give is just nonrecurring the of tied of RevPAR kind mentioned sense that what that one-time? words, thinking QX QX, you cash for in of you marketing? the demand kind from can where my calendar VIP guidance and kind - a And what your understand just give just bucket of and - In then, behind not to you changes comps wondering, I'm your VVIP would your is decline were wanting the of the group that other to gaming that you And some rate be the on about aside things, guide or I to for segments in issue put in

Eric Hession

that mix or answer quarter volatile. we To question, customer Sure. very our a for casinos the into even your can given be first month a receive

something and is think don't it's recur, year X because can the that So an it I the over that's the it we wouldn't period, entire something call of time want anomaly to take certainly of business when certainly the but representative true portfolio in you business.

when look we quarter, look In we And second we when coming saw you the the quarter, well. back the exact as fact, into believe fourth then happening. strength at the that opposite is

sense, in here reasonable up So in averaged it's fairly significantly down Las that those the to segments. and growth Vegas quarter in from having second quarter All fourth out third back. quarter, strong, casino

a forward. lot to every we're expected factors going by of those decline a year drive are that's So happen that wouldn't single customers, not overall, there we decisions but that see permanent going to and

Robin Farley

the you question? rate know part didn't the cash of any thoughts on And had if then I

Eric Hession

out sure that similar you we're analyst have we're the regarding efforts we guide metric provide the not what as and evaluating next fourth for for provide guidance that investing I'm make for evaluating sorry. hotel-related to we the guidance, of to XXXX. alternative the could we We're best going try to community, quarter, or indicators Yes, part any like we're whether our guidance should an something providing suggested but help year. for

Operator

Shojaian question of line from Research. the Our of Wolfe next comes Jared

your You may question. ask

Jared Shojaian

First, I missing be clarification, may just something. quick a in case

quarter? terms in that the there be quarter activity fourth You guidance. of unusual hold EBITDAR fourth of gave October actual aware to in any we need hold-adjusted Was

Eric Hession

to relative We the we the year said hold. was said year. What about current prior haven't anything

the Jared. So we're provided the quarter fourth assuming we when normal guidance, hold for

Jared Shojaian

room of You group that us that year? your terms what compares said you correct? you're this nights for those point just Eric, price booked in said tell are had at? I is last increase, Can you target And at XXXX. think XX% booked how time solid to

Eric Hession

Yes.

lower. XX also that group have but nights but somebody year, segment book, commits room works wash, in group always way an that meaning little extra XX% not say, always - typically bit a the come a to to of we the the is we do they room during that So nights, or X,XXX they

the nights really when that's the you you're entering we're numbers So extent booking that that get that room to high these wash, our offset in the to how year year.

typically the XX% So us start really better run. is know up. lets next yielding business we confidence than we that it segment It that into us of gives can year and

profitable and rates meeting is are next a very piece rate that business. the of business a when when rates, in the about up as think into business terms well it planners we because And as we heading the business, of booking we banquet of the look talk charged combination segment banquets the of the of In year. the as that's them want they're at component combination to

You might piece a or much versa. better that profitability but a component, business be could a segment book lower-rated basis, vice take higher of the on in RevPAR banquet and ultimately,

Jared Shojaian

me, then for one And last higher-level. one more just

given you your the you a for past, XXX. of bit? to had want had stipulations potential with ask just S&P about that So I overcome the speak lot of they've in out conversations you the a added I any to the them? just which think Have be to opportunity little to in volatility sale store, bankruptcy? GAAP be can Given may coming failed to challenging profitability, on

Eric Hession

materials having is our do the it difficult it right. our lot the our of earnings of derivative value GAAP a accounting of We are failed treatment the break We that does share That the sale and and for per number makes which terms the of the Yes, out derivative quarter. convert, are that including headwind said, required do actual you trading share in a we headwind. from have GAAP to profitability share There component have quarters. posted of it charges, have with to a we requirements. we respect in think positive this a in of price, stock. so affect profitability does a have per We and earnings this EPS very and predict that's retaining

Operator

back I Ms. Joyce turn further the no are like now remarks. Arpin would at to questions for to time. call closing this There

Joyce Arpin

joining. everyone, after you, our fourth for year. to talk Thank We'll report results we you Okay. next quarter