Caesars Entertainment Reports Fourth Quarter and Full Year 2017 Results

LAS VEGAS, March 7, 2018 /PRNewswire/ -- Caesars Entertainment Corporation (NASDAQ: CZR) today reported fourth quarter and full-year 2017 results as summarized in the discussion below, which highlights certain GAAP and non-GAAP financial measures on a consolidated basis. As of October 6, 2017, Caesars Entertainment Operating Company, Inc. (now known as CEOC, LLC "CEOC") emerged from Bankruptcy and Caesars completed the merger with Caesars Acquisition Company ("CAC").

Fourth Quarter Highlights

• Net revenues increased to $1.90 billion due to the inclusion of CEOC. Same-store revenues remained flat year-over-year at $1.96 billion.
• Net income was $2.00 billion, driven by a tax benefit of $2.03 billion relating to U.S. tax reform and CEOC's emergence from Bankruptcy.
• Adjusted EBITDAR improved to $491 million and same-store adjusted EBITDAR of $505 million exceeded previously communicated expectations.
• Our Las Vegas RevPAR was essentially flat year-over-year at $124, while Las Vegas Strip market RevPAR declined 3%.
• Marketing expense was reduced by 4% year-over-year, resulting in a 52 basis-point improvement in marketing efficiency.

Full Year Highlights

• Net revenues increased to $4.85 billion due to the inclusion of CEOC. Same-store net revenues remained flat at $8.12 billion.
• Net loss was $375 million. A $2.00 billion tax benefit relating to U.S. tax reform and CEOC's emergence from Bankruptcy was offset by $2.03 billion in restructuring expenses related to CEOC's emergence and a $232 million loss on debt extinguishment.
• Adjusted EBITDAR improved to $1.4 billion and same-store adjusted EBITDAR of $2.20 billion exceeded previously communicated expectations.
• Las Vegas RevPAR improved 3.9% to $132 driven by improved rates from additional renovated rooms and overall strength in hospitality management.

"Caesars Entertainment delivered another year of solid operating performance with revenue growth across all segments versus 2016, operating income margin expansion, and same-store EBITDAR margin up 59 basis points year-over-year to the highest level in more than a decade," said Mark Frissora, President and CEO of Caesars Entertainment. "Same-store gaming revenues increased company-wide for the full year despite unfavorable hold of approximately $80 million. Non-gaming revenues and Las Vegas RevPAR increased for the full year, driven by room renovations and overall strength of our hospitality assets. In 2018, we will continue to invest in our core business while pursuing attractive growth opportunities, including our acquisition of Centaur Gaming."

Note that certain additional non-GAAP financial measures have been added to highlight the results of the company including CEOC. Due to the timing of CEOC's emergence, Caesars results do not include CEOC until October 6, 2017. "Same-Store" results above and below include CEOC as if its results were consolidated during all periods, but remove the now deconsolidated Horseshoe Baltimore and Ohio Managed properties from all periods presented. See the tables at the end of this press release for the reconciliation of non-GAAP to GAAP presentations. GAAP and Same-Store results include CAC for all periods presented because the merger was accounted for as a combination of companies under common control. For same-store result reconciliations by region, see the historical information supplement in the Investor Relations section of www.caesars.com.

Summary Financial Data

In accordance with U.S. GAAP, the results of CEOC and certain of its U.S. subsidiaries were not consolidated with CZR from January 15, 2015 until October 6, 2017. Additionally, CZR deconsolidated the results of its Horseshoe Baltimore property in the third quarter of 2017, and exited a management relationship with certain properties in Ohio ("the Ohio Properties") in 2016, accounting for many of the fluctuations in the tables below.