LAS VEGAS and RENO, Nev., Aug. 3, 2021 /PRNewswire/ — Caesars Entertainment, Inc., (NASDAQ: CZR) (“Caesars,” “CZR,” “CEI” or “the Company”) today reported operating results for the second quarter ended June 30, 2021.
Second Quarter 2021 and Recent Highlights:
- Net revenues of $2.5 billion versus $127 million on a GAAP basis for the comparable prior-year period.
- Net income of $71 million compared to a net loss of $100 million for the comparable prior-year period.
- Same-store Adjusted EBITDA of $1.0 billion versus $(131) million for the comparable prior-year period.
- Company posted all-time records in quarterly Adjusted EBITDA and Adjusted EBITDA margin.
- Divested Caesars UK group on July 16, 2021.
- Launched comprehensive new marketing campaign for Caesars Sportsbook on August 2, 2021.
Tom Reeg, Chief Executive Officer of Caesars Entertainment, Inc., commented, “Our second quarter operating results improved significantly versus the first quarter of 2021 driven by continued strength in our regional markets and a dramatic improvement in results in our Las Vegas segment. With the William Hill acquisition now closed, we have officially rebranded our sports betting operations to Caesars and we launched our new comprehensive marketing campaign on August 2, 2021.”
Second Quarter 2021 Financial Results Summary and Segment Information
For the second quarter ended June 30, 2021, Caesars Entertainment, Inc. generated net revenues of $2.5 billion and net income of $71 million on a GAAP basis. After combining the results from the operations of Caesars Entertainment, Inc. with William Hill US prior to the acquisition and the results of our properties classified as discontinued operations but were not divested at the end of the period, which we refer to as a same-store basis for the period, Caesars Entertainment, Inc. reported same-store net revenues of $2.6 billion and adjusted EBITDA of $1.0 billion. For the periods ended June 30, 2020, a comparative same-store basis includes the results of operations of Caesars Entertainment, Inc. combined with William Hill US prior to the consummation of the acquisition on April 22, 2021 and the operations of Caesars Entertainment Corporation (“Former Caesars”) prior to the closing of the acquisition of Former Caesars on July 20, 2020 (the “Merger”) and eliminates results of operations for properties that have been divested. In our Las Vegas segment, the Company reported same-store revenues of $855 million and same-store adjusted EBITDA of $423 million for the quarter. In our Regional segment, same-store revenues were $1.5 billion and same-store adjusted EBITDA was $621 million. For Caesars Digital, our sports betting and online gaming segment, same-store net revenues were $117 million and same-store adjusted EBITDA was $2 million.
| Net Revenues | |||||||||||||||||||||||||||||||||||||||
| Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre-Acq. WH US (a) | Add: Disc. Ops (b) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre-Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | |||||||||||||||||||||||||||||
| Las Vegas | $ | 855 | $ | — | $ | — | $ | — | $ | 855 | $ | — | $ | — | $ | 109 | $ | — | $ | 109 | |||||||||||||||||||
| Regional | 1,490 | — | 80 | (28) | 1,542 | 114 | — | 186 | (24) | 276 | |||||||||||||||||||||||||||||
| Caesars Digital | 86 | 31 | — | — | 117 | 11 | 10 | 30 | — | 51 | |||||||||||||||||||||||||||||
| Managed and International | 66 | — | 20 | — | 86 | — | — | 27 | — | 27 | |||||||||||||||||||||||||||||
| Corporate and Other | 5 | — | — | — | 5 | 2 | — | 5 | — | 7 | |||||||||||||||||||||||||||||
| Caesars | $ | 2,502 | $ | 31 | $ | 100 | $ | (28) | $ | 2,605 | $ | 127 | $ | 10 | $ | 357 | $ | (24) | $ | 470 |
| Net Revenues | |||||||||||||||||||||||||||||||||||||||
| Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre-Acq. WH US (a) | Add: Disc. Ops (b) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre- Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | |||||||||||||||||||||||||||||
| Las Vegas | $ | 1,352 | $ | — | $ | — | $ | — | $ | 1,352 | $ | — | $ | — | $ | 931 | $ | — | $ | 931 | |||||||||||||||||||
| Regional | 2,681 | — | 142 | (69) | 2,754 | 577 | — | 1,060 | (148) | 1,489 | |||||||||||||||||||||||||||||
| Caesars Digital | 125 | 135 | — | — | 260 | 19 | 51 | 49 | — | 119 | |||||||||||||||||||||||||||||
| Managed and International | 127 | — | 30 | — | 157 | — | — | 135 | — | 135 | |||||||||||||||||||||||||||||
| Corporate and Other | 9 | — | — | — | 9 | 4 | — | 10 | — | 14 | |||||||||||||||||||||||||||||
| Caesars | $ | 4,294 | $ | 135 | $ | 172 | $ | (69) | $ | 4,532 | $ | 600 | $ | 51 | $ | 2,185 | $ | (148) | $ | 2,688 |
| Net Income (Loss) | |||||||||||||||||||||||||||||||||||
| Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre-Acq. WH US (a) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre-Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | ||||||||||||||||||||||||||
| Las Vegas | $ | 184 | $ | — | $ | — | $ | 184 | $ | — | $ | — | $ | (246) | $ | — | $ | (246) | |||||||||||||||||
| Regional | 251 | — | (13) | 238 | (92) | — | (314) | 28 | (378) | ||||||||||||||||||||||||||
| Caesars Digital | (22) | (22) | — | (44) | 5 | (24) | 8 | — | (11) | ||||||||||||||||||||||||||
| Managed and International | (13) | — | — | (13) | — | — | (18) | — | (18) | ||||||||||||||||||||||||||
| Corporate and Other | (329) | — | — | (329) | (13) | — | (504) | — | (517) | ||||||||||||||||||||||||||
| Caesars | $ | 71 | $ | (22) | $ | (13) | $ | 36 | $ | (100) | $ | (24) | $ | (1,074) | $ | 28 | $ | (1,170) |
| Net Income (Loss) | |||||||||||||||||||||||||||||||||||
| Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre- Acq. WH US (a) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre- Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | ||||||||||||||||||||||||||
| Las Vegas | $ | 117 | $ | — | $ | — | $ | 117 | $ | — | $ | — | $ | (240) | $ | — | $ | (240) | |||||||||||||||||
| Regional | 316 | — | (30) | 286 | (231) | — | (513) | 115 | (629) | ||||||||||||||||||||||||||
| Caesars Digital | (30) | (33) | — | (63) | 9 | (18) | 12 | — | 3 | ||||||||||||||||||||||||||
| Managed and International | 2 | — | — | 2 | — | — | (32) | — | (32) | ||||||||||||||||||||||||||
| Corporate and Other | (757) | — | — | (757) | (54) | — | (112) | — | (166) | ||||||||||||||||||||||||||
| Caesars | $ | (352) | $ | (33) | $ | (30) | $ | (415) | $ | (276) | $ | (18) | $ | (885) | $ | 115 | $ | (1,064) |
| Adjusted EBITDA (g) | |||||||||||||||||||||||||||||||||||||||
| Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre- Acq. WH US (a) | Add: Disc. Ops (b) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre- Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | |||||||||||||||||||||||||||||
| Las Vegas | $ | 423 | $ | — | $ | — | $ | — | $ | 423 | $ | — | $ | — | $ | (40) | $ | — | $ | (40) | |||||||||||||||||||
| Regional | 602 | — | 32 | (13) | 621 | (8) | — | (31) | 10 | (29) | |||||||||||||||||||||||||||||
| Caesars Digital | (5) | 7 | — | — | 2 | 5 | (5) | 9 | — | 9 | |||||||||||||||||||||||||||||
| Managed and International | 26 | — | (10) | — | 16 | — | — | (9) | — | (9) | |||||||||||||||||||||||||||||
| Corporate and Other | (42) | — | — | — | (42) | (8) | — | (54) | — | (62) | |||||||||||||||||||||||||||||
| Caesars | $ | 1,004 | $ | 7 | $ | 22 | $ | (13) | $ | 1,020 | $ | (11) | $ | (5) | $ | (125) | $ | 10 | $ | (131) |
| Adjusted EBITDA (g) | |||||||||||||||||||||||||||||||||||||||
| Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2021 | 2021 Pre- Acq. WH US (a) | Add: Disc. Ops (b) | Less: 2021 Divest. (c) | 2021 Total (d) | 2020 | 2020 Pre- Acq. WH US (a) | 2020 Pre- Acq. CEC (e) | Less: 2020 Divest. (c) | 2020 Total (f) | |||||||||||||||||||||||||||||
| Las Vegas | $ | 585 | $ | — | $ | — | $ | — | $ | 585 | $ | — | $ | — | $ | 181 | $ | — | $ | 181 | |||||||||||||||||||
| Regional | 995 | — | 52 | (30) | 1,017 | 99 | — | 97 | 4 | 200 | |||||||||||||||||||||||||||||
| Caesars Digital | (7) | — | — | — | (7) | 9 | 1 | 13 | — | 23 | |||||||||||||||||||||||||||||
| Managed and International | 47 | — | (18) | — | 29 | — | — | (12) | — | (12) | |||||||||||||||||||||||||||||
| Corporate and Other | (81) | — | — | — | (81) | (16) | — | (105) | — | (121) | |||||||||||||||||||||||||||||
| Caesars | $ | 1,539 | $ | — | $ | 34 | $ | (30) | $ | 1,543 | $ | 92 | $ | 1 | $ | 174 | $ | 4 | $ | 271 |
| ____________________ | |
| (a) | Represents results of operations for William Hill US for periods prior to the acquisition. Such figures are based on unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP. |
| (b) | Discontinued operations include Caesars Southern Indiana, Harrah’s Louisiana Downs and the Caesars UK group, including Emerald Resorts & Casino. Such figures are based on unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP. |
| (c) | Divestitures for the three and six months ended June 30, 2021 include results of operations for MontBleu and Tropicana Evansville and for the three and six months ended June 30, 2020 include results of operations for Isle of Capri Kansas City, Lady Luck Vicksburg, Eldorado Resort Casino Shreveport, MontBleu, Tropicana Evansville and discontinued operations of Harrah’s Reno and Bally’s Atlantic City. Such figures are based on unaudited internal financial statements and have not been reviewed by the Company’s auditors and do not conform to GAAP. |
| (d) | Excludes results of operations from divestitures as detailed in (c), includes results of operations of William Hill US prior to the acquisition and from discontinued operations for the periods presented. Such presentation does not conform to GAAP or the Securities and Exchange Commission rules for pro forma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company. |
| (e) | Represents results of operations for Former Caesars prior to the Merger. Additionally, certain corporate overhead costs which were historically charged to properties within the segments during the three months ended June 30, 2020 have been reclassified to Corporate and Other. These costs primarily include centralized marketing expenses, redundant executive and management payroll and benefits expenses, centralized contract labor expenses, and corporate rent expenses. Such figures are based on unaudited internal financial statements and have not been reviewed by the Company’s auditors and, for the 2020 periods, do not conform to GAAP. |
| (f) | Excludes results of operations from divestitures as detailed in (c) and includes results of operations of William Hill US prior to the acquisition and of Former Caesars prior to the Merger, including discontinued operations, for the relevant period. Such presentation does not conform to GAAP or the Securities and Exchange Commission rules for pro forma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company. |
| (g) | Adjusted EBITDA is not a GAAP measurement and is presented solely as a supplemental disclosure because the Company believes it is a widely used measure of operating performance in the gaming industry. See “Reconciliation of GAAP Measures to Non-GAAP Measures” below for a definition of Adjusted EBITDA and a quantitative reconciliation of Adjusted EBITDA to net income (loss), which the Company believes is the most comparable financial measure calculated in accordance with GAAP. |
Balance Sheet and Liquidity
As of June 30, 2021, Caesars had $14.7 billion in aggregate principal amount of debt outstanding. Total cash and cash equivalents were $1.1 billion, excluding restricted cash of $622 million.
| (In millions) | June 30, 2021 | December 31, 2020 | |||||
| Cash and cash equivalents | $ | 1,128 | $ | 1,776 | |||
| Bank debt and loans | $ | 6,722 | $ | 6,755 | |||
| Notes | 7,900 | 8,215 | |||||
| Other long-term debt | 51 | 53 | |||||
| Total outstanding indebtedness | $ | 14,673 | $ | 15,023 | |||
| Net debt | $ | 13,545 | $ | 13,247 |
“We anticipate that our balance sheet will be further enhanced through improved operating trends and expected asset sale proceeds. We paid down $325 million of debt during the quarter and remain committed to further debt reduction,” said Bret Yunker, Chief Financial Officer.
Reconciliation of GAAP Measures to Non-GAAP Measures
Adjusted EBITDA (described below), a non-GAAP financial measure, has been presented as a supplemental disclosure because it is a widely used measure of performance and basis for valuation of companies in our industry and we believe that this non-GAAP supplemental information will be helpful in understanding our ongoing operating results. Management has historically used Adjusted EBITDA when evaluating operating performance because we believe that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a full understanding of our core operating results and as a means to evaluate period-to-period results. Adjusted EBITDA represents net income (loss) before interest income or interest expense, net of interest capitalized, (benefit) provision for income taxes, unrealized (gain) loss on investments and marketable securities, depreciation and amortization, stock-based compensation, impairment charges, transaction expenses, severance expense, selling costs associated with the divestitures of properties, equity in income (loss) of unconsolidated affiliates, (gain) loss on the sale or disposal of property and equipment, (gain) loss related to divestitures, changes in the fair value of certain derivatives and certain non-recurring expenses such as sign-on and retention bonuses, business optimization expenses and transformation expenses, certain litigation awards and settlements, losses on inventory associated with properties temporarily closed as a result of the COVID-19 public health emergency, contract exit or termination costs, and certain regulatory settlements. Adjusted EBITDA also excludes the expense associated with certain of our leases as these transactions were accounted for as financing obligations and the associated expense is included in interest expense. Adjusted EBITDA is not a measure of performance or liquidity calculated in accordance with GAAP. It is unaudited and should not be considered an alternative to, or more meaningful than, net income (loss) as an indicator of our operating performance. Uses of cash flows that are not reflected in Adjusted EBITDA include capital expenditures, interest payments, income taxes, debt principal repayments, payments under our leases with affiliates of GLPI and VICI Properties, Inc. and certain regulatory gaming assessments, which can be significant. As a result, Adjusted EBITDA should not be considered as a measure of our liquidity. Other companies that provide EBITDA information may calculate Adjusted EBITDA differently than we do. The definition of Adjusted EBITDA may not be the same as the definitions used in any of our debt agreements.
About Caesars Entertainment, Inc.
Caesars Entertainment, Inc. (NASDAQ: CZR) is the largest casino-entertainment company in the US and one of the world’s most diversified casino-entertainment providers. Since its beginning in Reno, NV, in 1937, Caesars Entertainment, Inc. has grown through development of new resorts, expansions and acquisitions. Caesars Entertainment, Inc.’s resorts operate primarily under the Caesars®, Harrah’s®, Horseshoe®, and Eldorado® brand names. Caesars Entertainment, Inc. offers diversified gaming, entertainment and hospitality amenities, one-of-a-kind destinations, and a full suite of mobile and online gaming and sports betting experiences. All tied to its industry-leading Caesars Rewards loyalty program, the company focuses on building value with its guests through a unique combination of impeccable service, operational excellence and technology leadership. Caesars is committed to its employees, suppliers, communities and the environment through its PEOPLE PLANET PLAY framework. Know When To Stop Before You Start.® Gambling Problem? Call 1-800-522-4700. For more information, please visit. www.caesars.com/corporate.
