CAESARS ENTERTAINMENT, INC. Management’s Discussion and Analysis of Financial Condition

On Nov 6, 2021

The following discussion and analysis of the financial position and operating
results of Caesars Entertainment, Inc., a Delaware corporation, and its
consolidated subsidiaries, which may be referred to as the "Company," "CEI,"
"Caesars," "we," "our," or "us," for the three and nine months ended
September 30, 2021 and 2020 should be read in conjunction with the unaudited
consolidated condensed financial statements and the notes thereto and other
financial information included elsewhere in this Form 10-Q as well as our Annual
Report on Form 10-K for the fiscal year ended December 31, 2020 ("2020 Annual
Report"). Capitalized terms used but not defined in this Form 10-Q have the same
meanings as in the 2020 Annual Report.
We refer to (i) our Consolidated Condensed Financial Statements as our
"Financial Statements," (ii) our Consolidated Condensed Balance Sheets as our
"Balance Sheets," (iii) our Consolidated Condensed Statements of Operations and
Consolidated Condensed Statements of Comprehensive Income (Loss) as our
"Statements of Operations," and (iv) our Consolidated Condensed Statements of
Cash Flows as our "Statements of Cash Flows." References to numbered "Notes"
refer to Notes to Consolidated Condensed Financial Statements included in Item
1, "Unaudited Financial Statements."
The statements in this discussion regarding our expectations of our future
performance, liquidity and capital resources, and other non-historical
statements are forward-looking statements. These forward-looking statements are
subject to numerous risks and uncertainties. Our actual results may differ
materially from those contained in or implied by any forward-looking statements.
See "CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS" in this report.
Objective
This Management's Discussion and Analysis of Financial Condition and Results of
Operations ("MD&A") is intended to be a narrative explanation of the financial
statements and other statistical data that should be read in conjunction with
the accompanying financial statements to enhance an investor's understanding of
our financial condition, changes in financial condition and results of
operations. Our objectives are: (i) to provide a narrative explanation of our
financial statements that will enable investors to see the Company through the
eyes of management; (ii) to enhance the overall financial disclosure and provide
the context within which financial information should be analyzed; and (iii) to
provide information about the quality of, and potential variability of, our
earnings and cash flows so that investors can ascertain the likelihood of
whether past performance is indicative of future performance.
Overview
We are a geographically diversified gaming and hospitality company that was
founded in 1973 by the Carano family with the opening of the Eldorado Hotel
Casino in Reno, Nevada. We partnered with MGM Resorts International to build
Silver Legacy Resort Casino in Reno, Nevada in 1993 and, beginning in 2005, we
grew through a series of acquisitions, including the acquisition of Eldorado
Resort Casino Shreveport ("Eldorado Shreveport") in 2005, MTR Gaming Group, Inc.
in 2014, Circus Circus Reno and the 50% membership interest in the Silver Legacy
that was owned by MGM Resorts International in 2015, Isle of Capri Casinos, Inc.
("Isle" or "Isle of Capri") in 2017 and Grand Victoria Casino and Tropicana
Entertainment, Inc. in 2018. On July 20, 2020, we completed the merger with
Caesars Entertainment Corporation ("Former Caesars") pursuant to which Former
Caesars became our wholly-owned subsidiary (the "Merger").
On April 22, 2021, we completed the acquisition of William Hill PLC for
£2.9 billion, or approximately $3.9 billion (the "William Hill Acquisition").
We own, lease, brand or manage an aggregate of 53 domestic properties in 16
states with approximately 56,000 slot machines, video lottery terminals and
e-tables, approximately 2,900 table games and approximately 46,500 hotel rooms
as of September 30, 2021. In addition, we have other domestic and international
properties that are authorized to use the brands and marks of Caesars
Entertainment, Inc., as well as other non-gaming properties. Upon completion of
our previously announced sales, or expected sales, of certain gaming properties,
we expect to continue to own, lease, brand or manage 51 properties. Our primary
source of revenue is generated by our casino properties' gaming operations, as
well as online gaming, and we utilize our hotels, restaurants, bars,
entertainment, racing, sportsbook offerings, retail shops and other services to
attract customers to our properties.
We own 20 of our casinos and lease 27 casinos in the U.S. We lease 19 casinos
from VICI Properties L.P., a Delaware limited partnership ("VICI") pursuant to a
regional lease, a Las Vegas lease and a Joliet lease. In addition, we lease
seven casinos from GLP Capital, L.P., the operating partnership of Gaming and
Leisure Properties, Inc. ("GLPI") pursuant to a Master Lease (as amended, the
"GLPI Master Lease") and a Lumière lease. Additionally, we lease the Rio
All-Suite Hotel & Casino from a separate third party.

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We also operate and conduct sports wagering across 18 states plus the District
of Columbia, 14 of which are mobile for sports betting, and operate regulated
online real money gaming businesses in five states. Our recently launched
Caesars Sportsbook app operates on the Liberty technology platform, which we
acquired in the William Hill Acquisition along with other technology platforms
that we intend to migrate to the Liberty technology platform in the future,
subject to required approvals. The map below illustrates Caesars Digital's
presence as of September 30, 2021:
                     [[Image Removed: czr-20210930_g1.jpg]]
Subsequent to September 30, 2021, we launched retail sports in Louisiana and are
in the process of expanding our Caesars Digital footprint into other states in
the near term.

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We periodically divest of assets in order to raise capital or as a result of a
determination that the assets are not core to our business. We also divested
certain assets in connection with regulatory approvals related to closing of the
Merger. A summary of recently completed and planned divestitures of our
properties as of September 30, 2021 is as follows:
        Segment                               Property                              Date Sold                    Location

                              Isle of Capri Casino Kansas City ("Kansas
Regional                      City")                                               July 1, 2020                  Missouri
Regional                      Lady Luck Casino Vicksburg ("Vicksburg")             July 1, 2020                Mississippi
Regional                      Eldorado Resort Casino Shreveport               December 23, 2020 (a)             Louisiana
Regional                      MontBleu Casino Resort & Spa ("MontBleu")         April 6, 2021 (a)                 Nevada
Regional                      Tropicana Evansville ("Evansville")                June 3, 2021 (b)                Indiana
                              Belle of Baton Rouge Casino & Hotel                    N/A (c)                    Louisiana
Regional                      ("Baton Rouge")

Discontinued operations (d):

Regional                      Harrah's Louisiana Downs                         November 1, 2021 (e)             Louisiana
                                                                                September 3, 2021
Regional                      Caesars Southern Indiana                                (b)(f)                     Indiana
N/A               ...