Caesars Entertainment, Inc. · NASDAQ:CZR
Caesars Entertainment — Q1 2019 Earnings Presentation
30 slides from Caesars Entertainment's earnings presentation, May 1, 2019
Slide 1: 1Q 2019 Earnings
1Q 2019 Earnings • May 1, 2019 CAESARS ENTERTAINMENT CORPORATION
Slide 2: Forward Looking Statements
Forward Looking Statements Certain information in this presentation and discussed on the conference call which this presentation accompanies constitutes forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify these statements by the fa
Slide 3: Use of Non-GAAP Measures
Use of Non-GAAP Measures The following non-GAAP measures will be used in the presentation and discussed on the conference call which this presentation accompanies: • Adjusted EBITDAR and Adjusted EBITDAR Margin • “Hold Adjusted” financial measures • Results excluding Centaur Definitions of these non
Slide 4: 1Q Highlights Financial Performance
1Q Highlights Financial Performance C A E S A RS E N T E RT A IN M E NT • 1Q 2019 4
Slide 5: Tony Rodio Named CEO of Caesars Entertainment, Effective May 6
Tony Rodio Named CEO of Caesars Entertainment, Effective May 6 • Nearly four decades of experience in the gaming industry, including at Affinity Gaming, Tropicana Inc., Penn Gaming, Harrah’s Entertainment • Deep leadership experience across marketing, finance, operations • Has served on boards of se
Slide 6: Performance Highlights
Performance Highlights Marketing Efficiency2 Labor Efficiency3 1Q 2019 Improvement Improvement • Net revenues +7.3% YoY 150bps 50bps LTM 1Q19 LTM 1Q19 – +0.9% ex. Centaur • Adjusted EBITDAR1 +8.5% YoY – +0.4% ex. Centaur 24.0% 21.4% 23.5% • Adjusted EBITDAR margin1 26.6% 19.9% • Customer Service Sco
Slide 7: Investing in Growth Opportunities with Sports Betting
Investing in Growth Opportunities with Sports Betting • Caesars now operates 17 sportsbooks including 5 outside of Nevada; anticipate adding more this year Operations in 14 States and Physical/Digital pending legislation, as seen with Iowa approval Sportsbooks in NV, NJ, MS, PA • Signed new agreemen
Slide 8: Expanding the Network via Tribal Arrangement Strategy
Expanding the Network via Tribal Arrangement Strategy • Harrah’s Northern California near Sacramento, CA opened on April 29 • 71,000 sq. ft. casino floor with 950 slots, 20 table games and a full-service restaurant • Expands Caesars Rewards® network in a Harrah’s Northern California capital-efficien
Slide 9: 1Q Highlights Financial Performance
1Q Highlights Financial Performance C A E S A RS E N T E RT A IN M E NT • 1Q 2019 9
Slide 10: CZR Las Vegas Strip Key Performance Indicators
CZR Las Vegas Strip Key Performance Indicators +5.8% +12.1% +220 bps 1Q 1Q 1Q Adjusted Adjusted EBITDAR Net Revenue EBITDAR1 Margin1 +250 bps +2.1% +4.9% 1Q 1Q 1Q Occupancy2 ADR2 RevPAR2 1. Adjusted EBITDAR and related margins are non-GAAP measures and are presented for the reasons described in the
Slide 11: Other U.S. and All Other Financial Performance
Other U.S. and All Other Financial Performance Other U.S. Other U.S. Adjusted EBITDAR1 $ millions • Increase driven by acquisition of Centaur 42 (19) (6) 233 216 • Atlantic City impacted by increased competition while most other properties were impacted by weather 1Q18 Centaur Atlantic City Other 1Q
Slide 12: Debt, Liquidity and Capex Review
Debt, Liquidity and Capex Review $ millions Face Maturity Rate Fixed Variable $ millions Liquidity CRC Term Loan1 4,641 2024 L+ 2.75% 3,0002 1,641 CRC Unsecured Notes 1,700 2025 5.25% 1,700 - March 31, 2019 CEOC Term Loan1 1,481 2024 L+ 2.00% - 1,481 Cash and Cash Equivalents $1,395 Clark County Bon
Slide 13: Well-Positioned to Capture Continued Growth in Las Vegas
Well-Positioned to Capture Continued Growth in Las Vegas Las Vegas fundamentals are CAESARS FORUM Opening 2020 strong • 1Q Visitor volumes +0.8% • 1Q Convention attendance +1.5% • 1Q Deplaned air passengers +2.6% Important visitation catalysts in 2020 & beyond • Las Vegas Raiders • MSG Sphere • Esti
Slide 14: FY 2019 Cash Capex Estimates
FY 2019 Cash Capex Estimates Metrics Low High Maintenance Capex Same-Store Projects1, Centaur $375M $450M Development Cash Capex2 CAESARS FORUM, Korea JV $335M $410M 1. Same-store projects defined as maintenance capital and room renovations. Range does not include $65mm of 2018 capital paid in 2019.
Slide 15: Appendix
Appendix C A E S A RS E N T E RT A IN M E NT • 1Q 2019 15
Slide 16: 1Q 2019 Financial Performance by Region
1Q 2019 Financial Performance by Region Financial Results Net Revenue $ millions Net Revenues $ millions 1Q19 $ YoY % YoY 19 24 2,115 Las Vegas 955 52 5.8% 32 Other U.S. 1,010 84 9.1% 68 All Other 150 7 4.9% 1,972 Net Revenues 2,115 143 7.3% Gaming Contribution Net Revenues Hold Adjusted3 2,111 111
Slide 17: 1Q Supplemental Information
1Q Supplemental Information Horseshoe Baltimore Performance Key Drivers / Statistics (deconsolidated, 41% ownership stake) 1Q19 1Q18 YoY 1Q19 1Q18 Net Revenues (millions) $70 $70 Las Vegas Occupancy 95.0% 92.5% 250bps Adjusted EBITDAR (millions) $14 $16 Total Occupancy 89.1% 88.1% 110bps Adjusted EB
Slide 18: Net Income and EPS Components
Net Income and EPS Components 1Q 2019 Basic CEC $ millions, except per share data E(L)PS Net income attributable to Caesars $(217) $(0.32) Depreciation on failed sale-leaseback assets (111) (0.17) Non-cash interest on failed sale-leaseback financing obligations (36) (0.05) Failed Sale-Leaseback Info
Slide 19: Hotel Renovation Timeline
Hotel Renovation Timeline Completed Projects Rooms Completed In Progress Rooms Start Planet Hollywood Hotel Renovation 183 2015 Harrah’s Atlantic City Harbor Tower 506 2018 Caesars Palace Las Vegas Julius Tower 586 2016 Paris Las Vegas Hotel Phase III 1,596 2018 Caesars Palace Las Vegas Augustus Tow
Slide 20: Room Nights Off the Market by Quarter 2016-2019
Room Nights Off the Market by Quarter 2016-2019 Total Room Nights Off the Market (in thousands) 120 18.2 100 34.6 41.2 22.1 80 29.5 7.0 60 4.3 6.2 30.9 98.6 40 0.6 10.3 69.7 76.4 68.2 72.3 61.5 53.4 48.9 1.5 20 36.4 36.8 29.7 17.8 19.0 0 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q
Slide 21: RevPAR Components
RevPAR Components Rooms Occupied Comp ADR Includes the count of all rooms sold to a customer. Based on the best available rate for our best gaming customer (those likely to receive a complimentary room). These customers are entitled Rooms Available to the best available rate less 15%, if they were t
Slide 22: Reconciliation of Non-GAAP Information: Net Income to Adjusted EBITDAR
Reconciliation of Non-GAAP Information: Net Income to Adjusted EBITDAR CAESARS ENTERTAINMENT CORPORATION SUPPLEMENTAL INFORMATION RECONCILIATION OF NET INCOME/(LOSS) ATTRIBUTABLE TO CAESARS ENTERTAINMENT CORPORATION TO ADJUSTED EBITDAR Three Months Ended March 31, 2019 Three Months Ended March 31, 2
Slide 23: Reconciliation of Non-GAAP Information: Net Income to Adjusted EBITDAR
Reconciliation of Non-GAAP Information: Net Income to Adjusted EBITDAR CAESARS ENTERTAINMENT CORPORATION SUPPLEMENTAL INFORMATION - 2019 DATA EXCLUDING CENTAUR RECONCILIATION OF NET INCOME/(LOSS) ATTRIBUTABLE TO CAESARS ENTERTAINMENT CORPORATION TO ADJUSTED EBITDAR Three Months Ended March 31, 2019
Slide 24: Reconciliation of Non-GAAP Information: Hold-Adjusted Revenue and EBITDAR
Reconciliation of Non-GAAP Information: Hold-Adjusted Revenue and EBITDAR Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Unfavorable $ in millions CEC Favorable Hold Adjusted CEC CEC Hold Adjusted CEC Change % Change Net Revenue $ 2,115 $ (4) $ 2,111 $ 1,972 $ 28 $ 2,000 $ 111 5
Slide 25: Historical Information: Las Vegas Region
Historical Information: Las Vegas Region LAS VEGAS, $ in millions except KPI data 1Q18 2Q18 3Q18 4Q18 FY18 1Q19 Revenues Casino $ 257 $ 311 $ 249 $ 287 $ 1,104 $ 274 Food and beverage 242 245 244 244 975 255 Rooms 280 282 271 284 1,117 299 Management fees - - - - - - Reimbursed management costs - -
Slide 26: Historical Information: Other U.S. Region
Historical Information: Other U.S. Region Other U.S., $ in millions except KPI data 1Q18 2Q18 3Q18 4Q18 FY18 1Q19 Revenues Casino $ 663 $ 691 $ 789 $ 746 $ 2,889 $ 744 Food and beverage 134 139 158 140 571 137 Rooms 86 105 124 84 399 86 Management fees 1 1 (2) - - - Reimbursed management costs 1 - 1
Slide 27: Historical Information: All Other Region
Historical Information: All Other Region All Other, $ in millions except KPI data 1Q18 2Q18 3Q18 4Q18 FY18 1Q19 Revenues Casino $ 63 $ 60 $ 64 $ 67 $ 254 $ 65 Food and beverage 7 7 6 8 28 6 Rooms 1 1 - 1 3 1 Management fees 14 14 18 14 60 15 Reimbursed management costs 51 48 50 51 200 51 Other reven
Slide 28: Historical Information: Consolidated
Historical Information: Consolidated Consolidated, $ in millions except KPI data 1Q18 2Q18 3Q18 4Q18 FY18 1Q19 Revenues Casino $ 983 $ 1,062 $ 1,102 $ 1,100 $ 4,247 $ 1,083 Food and beverage 383 391 408 392 1,574 398 Rooms 367 388 395 369 1,519 386 Management fees 15 15 16 14 60 15 Reimbursed manage
Slide 29: Reconciliation of Non-GAAP Information: Notes
Reconciliation of Non-GAAP Information: Notes Property earnings before interest, taxes, depreciation and amortization and rent (“EBITDAR") is a measure of Caesars Entertainment Corporation’s (the “Company”) performance. Property EBITDAR is defined as revenues less property operating expenses and is
Slide 30: C A E S A RS E N T E RT A IN M
C A E S A RS E N T E RT A IN M E NT • 1Q 2019 30
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