CZR Caesars Entertainment

Tony Rodio Chief Executive Officer
Eric Hession Chief Financial Officer
Joyce Arpin Senior Vice President, Finance & Treasurer
Carlo Santarelli Deutsche Bank
Thomas Allen Morgan Stanley
Shaun Kelley Bank of America
Harry Curtis Nomura Instinet
Jeff Stantial SunTrust
Call transcript
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Hello! And welcome to today's webcast. My name is Christina and I will be your event specialty today. All lines have been placed on mute to prevent any background noise. Please note that today’s webcast is being recorded. [Operator Instructions].

pleasure Vice today’s President, my Joyce over now Senior Arpin, Finance is to program turn to It & Treasurer. is floor the yours. Joyce,

Joyce Arpin

Thank conference welcome third you. and Caesars Good Corporation, Entertainment to quarter call. the earnings XXXX afternoon

Joining Executive Chief and Chief Tony Officer; from me Eric Caesars today Officer. are Rodio, Entertainment Financial Hession,

please press to earnings our slides are Investor X-K call section of and Form in copy our a the available replay of A copy the XX-Q. prior release, will and the earnings of the at note we furnished release Also, website file the Form this SEC call presentation that this conference of a in Relations to

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

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

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

our Centaur Note of versus reflect include that unless otherwise from not July XXXX closed addition, adjusted Centaur U.S. that expectations. the prior on quarter results third Entertainment both results the acquisition Caesars in do third XXXX of In Holdings XX. note the to stated. acquisition hold in quarter of GAAP the Therefore, Holdings

slide non-GAAP and XX. can You reconciliations find GAAP figures starting of on

turn over now to will Tony. call the I

Tony Rodio

discuss developments quarter results of in detail. to provide Joyce. you, and call the greater to over recent turning a I'll Thank Eric our before the overview third quick performance

occur on with of half a to on the November the track and planning the on remain definitive will filed significant close made for the shareholder on each votes of the We update on our in We progress First, October companies quick integration Eldorado. we XXXX. merger proxy XX and XX. first

third verticals Vegas. $X.XX billion by business adjusted hold revenues Turning up and in to our growth net X.X% revenues driven favorable for all across grew of X.X% Las the results; year-over-year Net hold. year-over-year, totaled quarter

Solid consumer occupancy we revenues baccarat an drove including an and increased increase volumes, Las hold and and in demand hotel in Vegas the ADR. as higher table saw increase volumes XX% slot and in

legal reductions totaled adjusted driven payroll, professional X.X% to $XXX services, risk Third basis management. Adjusted margins points revenue EBITDA in up quarter expenses year-over-year XX.X%. corporate year-over-year by and million, XXX and expense EBITDA growth expanded

Park very decrease [inaudible]. also Hoosier were Caesars Vegas deliver Palace are and pleased Indiana Las that at in despite Indiana, a these our renovation the across which and our of in at Colosseum the strong impacted rooms at third for to visitations portfolio, able closure temporary including We quarter closures demand road Harrah's we results Grand, in the headwinds and at

basis point XX.X% efficiency. On in costs marketing our efficiency revenue, in reflecting improvement of labor XX reflecting basis improvement XX XX.X% revenue, domestic trailing labor represented a represented gross basis a marketing gross month a while year-over-year, point costs XX of

sale the an result resources on announced the Las capital our for our to is us to we expected Rio incremental $XXX.X asset of at growth properties. EBITDA and The agreement September properties In Vegas an allows focus Strip sell million. this to strengthening those of portfolio

we’ll rewards Importantly, rights customers the to our World for of retain and valuable continue seasonal have rights Series more we Poker. hosting to marking

closing the conditions. We expect XXXX to subject close customary the sale of end by to

Rewards will a continue be to property that lease the remain years signed at and lease Rio agreement The sale minimum Caesars operate two for closing, the to a the period. during For of pursuant network part will we of agreement to

continue past have pleased the and expanded are seven New made Mississippi, We've with We sports sports locations books progress Caesars over recently the grow York. Caesars across our Nevada, branded XX we've and Indiana Iowa business and year. now and quarter in across Iowa, betting third Jersey, sports states: the New to Pennsylvania, books to Indiana

sports Mobile value be live visitation the New coming is for and portfolio driving expect years. pending the already driver betting sports and approval. company and in we The increased to Pennsylvania across regulatory engagement our launch customer betting and a to sports key Nevada expect Jersey in are over we new books

to Now, I’ll getting in turn to more your call the over detail results to review before financial questions. our Eric

Eric Hession

note Well, Tony. include stated. consolidated Centaur results our that Please you thank unless otherwise

Las mentioned, totaled business year-over-year were all due in X.X% to $XXX Vegas million, quarter. Tony verticals the demand. revenue across up favorable strong from third customer results strength As Net

Gaming slot revenues of volume Table X% up increased year-over-year. to Total were and up $XX increased due up year-over-year gaming favorable in led X.X% increased million baccarat by XX% volumes gamming XX% hold volumes. were volumes year-over-year, records QX revenues Vegas in X.X% quarter the cash making of also Vegas year. in this revenue Recall similar Las grew Las achieved QX history. third hotel we X.X%. hotel that and cash company highest

bookings XXX XX.X% the We segment. X% to our increased basis RevPAR to experienced points strong from website room group's growth and and from the $XXX. segment Occupancy and the on nights leisure direct in increased

specifically Las see throughout Vegas remainder demand to remain and to the paying consumer cash strong healthy year, the of in customers. continue expect with a We environment hotel

premium million and Caesars increased made occupancy to recent increase Hell's hotel Food and we Cocktail driven and beverage by outlets cash enhancements due saw the offerings. new higher like or our levels revenues year-over-year, largest the to Palace X.X% Kitchen. Garden primarily other $X Vanderpump

hold $XXX up revenue basis. X.X% solid by XXX points adjusted XX% EBITDA margins expanded basis the a Vegas to XX.X%, or year-over-year driven on million EBITDA growth. up Las totaled

and City revenues Indiana. down the year-over-year, of million favorable the to competition Southern Turning year by additional U.S. prior offset hold of period Centaur in totaled of impact increase as weeks Atlantic results the segments, net $XX other approximately million from X.X% billion unfavorable was $XX two $X.XX versus and

U.S. from $XXX disruption as casino expected the X.X% is December. but revenues, to EBITDA complete XX declined land due our a our contracted construction up was a points results. million Southern move In in basis, City boat in to margins moved to million Other EBITDA we normalized was XX.X%. hold impacted be Indiana This the hold to to basis EBITDA normalized properties basis. X% year-over-year. Atlantic On a in to $XXX on flat decreases addition,

loss our properties Clubs at partially operations, to $XXX year-over-year, Our decreases expenses, our includes down expenses primarily of due year-over-year. all a and corporate offset revenues X% reduction other to segment, net performance London which at other million in lower operations had unallocated our EBITDA a by million $XX million, games which All million, or $X was volumes international due increased $X managed properties. table in loss to corporate of international

noted, payroll, reduced Tony professional As and services IT expenses we the in quarter.

to-date. Looking slightly quarter passengers remains increased digit volumes future growth we've ahead, and improve and expect hold and deplane seen quarter Vegas fourth convention to Las X.X% in on to trends visitor expect single low In line in X.X%. revenue indicators continued based we positive we margins demand Vegas the our increased results the outlook year-to-date year-over-year. attendance normalized In third with growth Las X.X%, increased

in our as non-gaming This customers, demand we faced that environment the of increase will year-over-year. demand the to segments. stable half year demand fourth in stronger we are leisure led and database hotel lower and Recall overall stabilize which cast last latter seeing the view cash from occupancy. modestly quarter tapped We growing, by year revenues paying

in We’re growth nights also seeing revenues group a and digit fourth expect and the strong group in growth we high bookings quarter. single room quarter in double digit for

XXXX, Forum Caesars and an first by million bookings of we for $XX scheduled ahead our three Center years Sure, Caesars the in forum is which well acceleration revenues in has XX% booked the nights anticipate March. XXXX in Total of are Vegas our open already Convention are of over million, X.X expectations. currently Las in million to through Forum in over $XXX operations. which led room

In the overall margins the in acquisition with the improve grow to anticipate fourth quarter. slightly strong in segment, to remaining revenues the third U.S. a single year-over-year growth other driver, and Centaur we quarter, despite annualizing digits low net

to Indiana. betting additional continue positive and fourth expect the quarter in from synergies expect We in a recent the sports of to extract lift legalization

project completion the month Additionally into rebranding the transform we effort the renovation asset. to of expected to end marks XX property an Southern of land boat Indiana a December premier Caesars

to in investments quarter by we savings. larger loss In a be compared segment operating investments expect we to business. which generate will the to sponsorships, labor technology the offset full and In year the to infrastructure, our sports in all fourth our international expect other partially for XXXX due increase, sports weakness

in a $X.X perspective, cash. quarter ended the From we approximately with billion liquidity

CapEx store the In $X.X As and with we development XX spent in $XXX total capacity million drawn. of in September was million same billion our third quarter $XX CapEx. revolver zero

million billion and to bringing we excess enterprise $X.X $XXX quarter used also to the loan, the of term the cash During X.Xx. repay adjusted to balance CEOC lease down voluntarily leverage gross down wide our

lease Xx, notes X.Xx. the capitalizing convertible Excluding at our net leverage payments and standard our

$XXX XXXX, of renovations For $XXX Vegas. maintenance, cash range million room CapEx includes expect Las at million to now a in in we which Harrah's

investments Caesars approximately spend which project to our for spends are the range This in million projects and we development sports across related expect evaluating. mostly for CapEx, currently excludes books We U.S. million the for Forum the $XXX to Korea $XXX

the is our purpose third performance. Before call call we note the discuss quarter please open that for questions, of to today's

you questions about Caesars, merger While more the refer we filings of answering SEC. forward any regarding with for proposed have please the our to look to information Eldorado,

the for calls we’ll Operator, open questions.


[Operator Instructions]. Thank you.

is from Bank. comes open. line Deutsche ahead, question your from Santarelli first Please Carlo Your go

Carlo Santarelli

you targeting obviously if Hey, that last that that and are extent you on seems thanks in helpful. the made through. some that some and and obviously quarter, would stage this in Tony, it, To on a of of that talked call think reduction kind for what quarter. terms about flowing the is based everyone guys the you where nice efforts lot at be kind about the of of collectively in have you are of timeline I cost I in and could, very stuff it talk you can process performance the performance a the

Tony Rodio

$XX I Yeah, take by quarterly think got I goal of on million cost million transaction. call I and $XX million $XXX a think Okay, on it I'm of estimate in the between worth to out of going was to we million somewhere that I now comes of time closing mentioned happy business had buckets. it's that the to that, say Carl. end the that to higher today variety of to my the the be thanks it and last to make would $XX

natural just at property whole international our suspended Japan reduce efforts a eliminated the outside a we've in slot We down that standpoint particularly portfolio. part and left. pursuits services. participation and as to of cautious and those positions. games and across into consultants about larger a We've be way, synergy licenses harm’s approach attrition may We’ve corporate professional also contractors the other jurisdictions, people don't a number here a From filling people then of have and We if for very road. want take position hire it's

we program the XX stayed few a they here launched the allow at voluntary to they which gotten and had their ago eliminate raise then were them benefits to if have cost And weeks closing. allows severance we would hand to had take through people us we now approximately closing, again but able lastly, which the between corporate,

win-win for think was a I it So everybody.

more but the say I again, them get quarter, voluntary because beginning lot the about it's of million. would are the $XX first be think And the severances, million to through, will accept over next couple allowed of as see we So to to $XXX it see they flow a months. though those you'll course of we into I flow of now

Carlo Santarelli

detailed, Great! Eric. probably little and bit for something a Thank you then best more I guess

prior a know you a I performance. you some saves, talked remarks. from that revenue a Southern but boat, it’s seen if – with maybe this cost on respect on as of you extent you EBITDA, talk even guys disruptive certainly a the perspective of you period the revenue on you to obviously uplift before, just in here, experience year-over-year You have terms kind Can would about impact basis, we’ve bit Indiana the the expected percentage you the done it prepared decline. stronger in can you know what be, to foresee basis, little bit a well to little gross based and When as about, a have foresee the the from during

Eric Hession

the you it the cost have great dredging side, drivers; other are question, as a to and really experience you're captains boat to land. Yeah, which and standpoint the of and a about on a from and the of from return so we’ve moving properties moved have looking is we one is to maintain simply no X% boat, longer can land. from at the by is business so return and two pulling both get do by sometimes There limited X% real the includes expenses you out that forth, downside project costs the the

Then customers, we’ll XX% of a field you on gambling environment the there create the the casino, typically see other in perspective better and and your X% a another ultimately much perspective side the of from what both for is to kind change. also

return on I that. wouldn’t projects have able to to these So be that we target expect get no around that and a XX% reason we

Tony Rodio

of competitive there And is bit I as the of Kentucky to a BLT. that Thank you. effect only the noise little color would that well, in given Derby, market add

Carlo Santarelli

very you much guys. Thank Great!

Tony Rodio



Stanley. from question Your next Allen from is Morgan Thomas

Your ahead. line go please open, is

Thomas Allen

the Can EBITDA going you The talk what you Hey, loss big you that's Thanks. news so about Rio. Caesars? for in of think to sign that generate quarter just kind as

Tony Rodio

lot transferred our retain Las just Caesars able next over two mean that I were, maintain years, being think eight number of Well, forecasts ability I in our properties retain other know think the Eric managing to of property an but to of being of to to I the the the vast going have World still in a Vegas. Series terms we that. you exact customers, anticipate Rewards be we to if don’t majority what Poker, is business our able that and for

Thomas Allen

hold quarter. on City, prepared the you I segment then outlook for EBITDA said your flat in the and in kind to what’s your expectations that that forward? remarks. of believe Okay, Thanks. Atlantic adjusted AC did you was mentioned How going compare and

Tony Rodio

to opened the before you City the have that right decline Well, certainly competition accomplished we around. move can stop has and my I turn been since around and I something going from new turn that the you number mean that. in we've it the expectation of quarters and is begin wrong first the think last and in Atlantic direction, to direction,

we've decliners initiatives competitors. are are marketing we our We new targeted testing specific share towards feel lost inactive customers that more and and that some market customers, to

So and I'd over to that fourth to more importantly there to think into XXXX. balance like going show be the improved able quarter, the we're trends of

Thomas Allen

you. thank Helpful,

Tony Rodio



from Bank Kelley next Your question Shaun from is America. of

go please open, ahead. is line Your

Shaun Kelley

Hi, good afternoon everyone.

on some just wondering of overall You maybe operating markets. sort of or future guys I bit core of just the and little Las some great Vegas color if regional the KPIs. the same, environment the was you do a

consumer – and the are primary regional at this seeing other minuses kind think in I you little bit Centaur Southern a to be in maybe that you core know progress and of Tony, there. growth You what some you drivers any going the and about for mentioned or broadly pluses of XXXX, Is Indi point. Eric and it speaking was of terms the it just the call

Tony Rodio

two one, to those upside fit many Indi would properties in as online XXXX. of we of there couple a going think expansion either certainly properties able of growth an like, to that and but result X Indi businesses we're in tables buildings, a the to we'll games in include have the at phases, of because to second table not Number as see coming upside the the at phase so the phase we’ll be of do in the we

betting upside then be think spread across boat not driver. to is the we're as going to country that to you and The We also probably land as to mentioned going to continues of sports continue and there, $XXX a view the we're deploy that extension the to we deploy in we to of but XXXX, going lot lease as New upside have XXXX. million our with by in that a Orleans

a rooms we XXX% again year, in we occupancy. the vicinity have there, won't that XXXX. XX,XXX somewhere buy at upside run [inaudible] have of lot market rooms but so at probably non-gaming XXX,XXX in and every We Additional New to be XX,XXX Orleans, the we of hotels from with

the are the Kentucky. Not and far the in definitely part gaming expansion but headwinds, headwinds, both Arkansas live got As that'll as as affect expected of and AC. as open. well Illinois, expansion continues VGT for the as there We've rating Oklahoma totally then latter in to historical Philly games competitive some and XXXX, in

Shaun Kelley

much. thank know able on And there. you side very reductions then, and you Great, latest of sort some update direct deploy marketing other been to your the you’ve

there? sort or your out new. general new we a bit transitional programs is that going about, initiatives in improvement kind of where your that it's Just here a kind strategy period from too in know of anything to of modest to or of you’re sort are of kind that excited be of any You incremental understanding – roll

Tony Rodio

Yeah, I it's think that business to do usual. as continuing more

marketing guys the allies team be I one new would competition. should weren’t and job with think face have those, know Atlantic that fantastic of as always we here, you think some where as we of aggressive done the a reference the are there's I – of the City kind again, in I as exceptions

marketing large testing be dramatic So other markets the a Vegas, are to even here across in standpoint. going by but there's from regional continuing our wholesale change new Las marketing programs. not in and test Vegas, approach to and to Las some here doing We're a we direct

Shaun Kelley

Thank taking you for questions. the


next question Instinet. is Harry Your Nomura from Curtis from

open, is go please line ahead. Your

Harry Curtis

Hi, good afternoon.

mentioned sector in $XX have about favorable of other the guys You hold million.

that $XX impact favorable million? the in hold So around was that imply Vegas does

Eric Hession

Harry. it was the other No, way

had year-over-year regions a net then on the in XX of XX, company. so Vegas, we Sorry, and basis in positive XX positive of the that's negative of a for about around

Harry Curtis

misunderstood. I see, I

Tony Rodio

tremendous I that portfolio in whole onto I but definitely the the color Las we some had don't had across we a results the to Las don't add just results, could Vegas. hold, – want I because if favorable minimize And Vegas

mentioned you table the As our gaming grow because comments, slot in volume volumes Eric we quarter third volumes, we're our and record his the we at come expense the were cash would revenue, to cash by think had in and able of straight for customers more would that room, hotel but putting X%.

baccarat volume do standpoint. Our to entertainment and very food to XX%, well we and an continue escalate from beverage revenues continue

Colosseum made of changes just the up, because months, we and basis wasn't event-by-event example two on but for and more of Roses in beverage to it N’ the up customer the its certainly next of experience. you quarter-over-quarter a forward for and closure entertainment the terms sales Guns to with the for Overall very had that do throughput great to are we Colosseum it's We're an to from in year the able look facility, know bookings exciting standpoint.

So just we're well. Las think Vegas I I is think overall – extremely doing

Harry Curtis

or a do do guys with did there lift outperformance What the that think stabilization Do management? sneak in as other accounts market. to to agree that particularly it brilliant sense you you is than pertains you in we baccarat, question, baccarat want that. which share of taking Yeah, think follow-up the another an were XX% the kind is I outlier. you in for

Tony Rodio

standpoint. but my with not Well, that, agree it's I from

relationships The at great foremost wanted job, I creating management a Asian team, their and first here and cultivating to and They've to team with done that give marketing business. credit palace. Caesar's them the

a we’re fact of do over coming matter back trip a just that very business thing. to As just there from

have think bit but team. are the know and is XX% well that to here don't that at the villas, numbers marketing the I from to dollars of Asian none. are. believe those experiences Caesar's with think we’ve share, I palace team the steal management of senior deployed I I as what a as comes second think our also a mostly it that I’d capital exact growth,

Harry Curtis

to turning betting. just sports question, last And

have and Jersey EBITDA creation accretion which maybe the books who So far how operating delineate don't, if could a got of and those you've New much you in how that then XX and are mobile mobile Nevada, any and or don't. close those between in result live the as states sports that betting you to

Tony Rodio

legislation. as EBIDA, driving its incremental Like that's we're that the I sports of a result betting sports from component in and betting certainly smallest benefiting of of the itself, but what think

traffic, In look to that for us, we've had or few our two you point opened a the up X%. and property are in months food our the up a revenues opening up sports volumes lift around If book, a gaming Hammond, revenues seeing beverage since seeing like leading a sports significant book in two. We're as significant our at we're quarters sales; result. before the been are lift the down foot

by money betting yeah, So creating. making we're we're all it's of sports because even traffic making the itself, money one but more

Eric Hession

and board. Yeah, across it the we're seeing

you trends If Mississippi at they influencing question opened than that impact at the and effect, that magnitude all but food are of books and some no the beverage on a similar ones larger in if in look look there's and others, we’re Iowa, selling. we the Indiana, in they're definitely customer you have having amount direct visitation that

Harry Curtis

you. Got it! Very thank helpful,


David comes next Your Jefferies. Katz question from from

Your line is open, please go ahead.

David open. is Katz, your line

Tony Rodio

I we David. think lost


We’ll your please Barry is line ahead. SunTrust; go Jonas move open, on. from

Jeff Stantial

Hey Stantial guys, this for is Jeff Barry. on

I curious, the next competition mentioned of in Indiana get thoughts your online the and Illinois. then beyond, year later builds the into into with through some on for earlier thinking later wanted in to you XXXX. and and in new puts Just XXXX Gary takes year, coming some project, the just

on your thoughts of Just curious those.

Tony Rodio

Gary – the is to forecasted headwind adding I going our from greatest the bit Hammond, in be political I think of know are to as – a certainly going also VGT’s about uncertainty the and X good of impact. X Joliet, as headwinds Metropolis. I the is as it well think appears don't license Well, thing Illinois and businesses downtown would that it well. in we’ve to but those if have little going is to beyond mean, the I gaming impact I Gary, the which from a property mean certainly think impact I some expansion Chicago, be

VGT the isn’t on the six think impact unit. I bigger the

and I win think the more bigger wager impact can more. customers is that

want for gaming option. more makes people a it think who convenient just I and compelling a enticing product it

Eric Hession

that It than less the this the our we year portfolio entire broadly than in of The the broadly across but middle speaking next year, less to just we is year in think you called that and in years. to disruption concentrated year. and prior add happens be coming what plan for speaking prior the see it's competitive we've we're markets this experienced look out, do only when process I’d

Jeff Stantial

Okay, from great, That’s color appreciate all I me. thanks. the guys.

Tony Rodio

Thank you.


to great you webcast hope this participants today. our now you Thank all day! found presentation a webcast us This you their for joining disconnect. informative. concludes Have and We may