Segment Reporting

12 Months Ended

Dec. 31, 2019

We view each property as an operating segment and aggregate such properties into three regionally-focused reportable segments: (i) Las Vegas, (ii) Other U.S. and (iii) All Other, which is consistent with how we manage the business. These segments include the following properties:



Las Vegas	Other U.S.	All Other
Bally’s Las Vegas	Bally’s Atlantic City ⁽¹⁾	Managed Properties ⁽¹⁾	Other
Caesars Palace Las Vegas ⁽¹⁾	Bluegrass Downs ⁽²⁾	Caesars Dubai	Caesars Interactive Entertainment
The Cromwell	Caesars Atlantic City ⁽¹⁾	Caesars Windsor
Flamingo Las Vegas	Caesars Southern Indiana ⁽¹⁾	Harrah’s Ak-Chin
Harrah’s Las Vegas	Harrah’s Atlantic City	Harrah’s Cherokee
The LINQ Hotel & Casino	Harrah’s Council Bluffs ⁽¹⁾	Harrah’s Cherokee Valley River
The LINQ Promenade	Harrah’s Gulf Coast ⁽¹⁾	Harrah’s Resort Southern California
Paris Las Vegas	Harrah’s Joliet ⁽¹⁾	Horseshoe Baltimore ⁽³⁾
Planet Hollywood Resort & Casino	Harrah’s Lake Tahoe ⁽¹⁾	Kings & Queens Casino
Rio All-Suite Hotel & Casino ⁽⁴⁾	Harrah’s Laughlin ⁽¹⁾
	Harrah’s Louisiana Downs ⁽¹⁾	International ⁽¹⁾
	Harrah’s Metropolis ⁽¹⁾	Alea Glasgow
	Harrah’s New Orleans	Alea Nottingham
	Harrah’s North Kansas City ⁽¹⁾	Caesars Cairo
	Harrah’s Philadelphia ⁽¹⁾	Emerald Casino Resort ⁽⁵⁾
	Harrah’s Reno ⁽¹⁾⁽⁶⁾	The Empire Casino
	Harveys Lake Tahoe ⁽¹⁾	Manchester235
	Hoosier Park	Playboy Club London
	Horseshoe Bossier City ⁽¹⁾	Ramses Casino
	Horseshoe Council Bluffs ⁽¹⁾	Rendezvous Brighton
	Horseshoe Hammond ⁽¹⁾	Rendezvous Southend-on-Sea
	Horseshoe Tunica ⁽¹⁾	The Sportsman
	Indiana Grand
	Tunica Roadhouse ⁽¹⁾⁽⁷⁾

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⁽¹⁾	These properties were not consolidated with CEC prior to the Effective Date with the exception of Horseshoe Baltimore, which was consolidated in the Other U.S. region prior to deconsolidation.


⁽²⁾	Bluegrass Downs ceased operations on October 1, 2019.


⁽³⁾	As of December 31, 2019, Horseshoe Baltimore was 44.3% owned, and was deconsolidated and held as an equity-method investment effective August 31, 2017.


⁽⁴⁾	Rio was sold on December 5, 2019 and Caesars continues to operate the property under a lease for an initial term of two years.


⁽⁵⁾	In May 2019, we entered into an agreement to sell Emerald Casino Resort. As of December 31, 2019, the property’s assets and liabilities were classified as held for sale.


⁽⁶⁾	In December 2019, we entered into an agreement to sell Harrah’s Reno, contingent upon the Merger.


⁽⁷⁾	Tunica Roadhouse ceased gaming operations in January 2019. Hotel operations continued until it closed in January 2020.

In addition to our properties listed above, other domestic and international properties, including Harrah’s Northern California, are authorized to use the brands and marks of Caesars Entertainment Corporation.

The results of each reportable segment presented below are consistent with the way management assesses these results and allocates resources, which is a consolidated view that adjusts for the effect of certain transactions between reportable segments within Caesars. We recast previously reported segment amounts to conform to the way management assesses results and allocates resources for the current year. Net revenues are presented disaggregated by category for contract revenues separate from other revenues by segment.

“All Other” includes managed, international and other properties as well as parent and other adjustments to reconcile to consolidated Caesars results.

Condensed Statements of Operations - By Segment

	Year Ended December 31, 2019
(In millions)	Las Vegas			Other U.S.			All Other			Elimination			Caesars
Casino	$	1,149		$	3,053		$	246		$	—		$	4,448
Food and beverage ⁽¹⁾	1,017			576			25			—			1,618
Rooms ⁽¹⁾	1,177			401			3			—			1,581
Management fees	—			—			60			(1		)	59
Reimbursed management costs	—			2			210			—			212
Entertainment and other	437			183			54			(4		)	670
Total contract revenues	3,780			4,215			598			(5		)	8,588
Real estate leases ⁽²⁾	139			10			1			—			150
Other revenues	—			—			4			—			4
Net revenues	$	3,919		$	4,225		$	603		$	(5	)	$	8,742

Depreciation and amortization	$	495		$	455		$	71		$	—		$	1,021
Income/(loss) from operations	560			525			(467		)	—			618
Interest expense	(330		)	(572		)	(468		)	—			(1,370		)
Other income/(loss) ⁽³⁾	(1		)	1			(587		)	—			(587		)
Income tax benefit ⁽⁴⁾	—			—			141			—			141



	Year Ended December 31, 2018
(In millions)	Las Vegas			Other U.S.			All Other			Elimination			Caesars
Casino	$	1,104		$	2,889		$	254		$	—		$	4,247
Food and beverage	975			571			28			—			1,574
Rooms	1,117			399			3			—			1,519
Management fees	—			—			63			(3		)	60
Reimbursed management costs	—			2			200			—			202
Entertainment and other	411			175			45			(3		)	628
Total contract revenues	3,607			4,036			593			(6		)	8,230
Other revenues	146			11			5			(1		)	161
Net revenues	$	3,753		$	4,047		$	598		$	(7	)	$	8,391

Depreciation and amortization	$	582		$	501		$	62		$	—		$	1,145
Income/(loss) from operations	716			434			(411		)	—			739
Interest expense	(327		)	(556		)	(463		)	—			(1,346		)
Loss on extinguishment of debt	—			—			(1		)	—			(1		)
Other income ⁽³⁾	3			2			786			—			791
Income tax benefit ⁽⁴⁾	—			—			121			—			121



	Year Ended December 31, 2017
(In millions)	Las Vegas			Other U.S.			All Other			Elimination			Caesars
Casino	$	864		$	1,188		$	116		$	—		$	2,168
Food and beverage	700			274			8			—			982
Rooms	872			201			1			—			1,074
Management fees	—			—			15			(3		)	12
Reimbursed management costs	1			1			46			—			48
Entertainment and other	300			84			24			(3		)	405
Total contract revenues	2,737			1,748			210			(6		)	4,689
Other revenues	165			10			5			(1		)	179
Net revenues	$	2,902		$	1,758		$	215		$	(7	)	$	4,868

Depreciation and amortization	$	420		$	186		$	20		$	—		$	626
Income/(loss) from operations	549			199			(211		)	—			537
Interest expense	(65		)	(153		)	(555		)	—			(773		)
Gain on deconsolidation of subsidiary	—			31			—			—			31
Restructuring and support expenses	—			(177		)	(1,851		)	—			(2,028		)
Loss on extinguishment of debt	(4		)	(13		)	(215		)	—			(232		)
Other income ⁽³⁾	4			1			90			—			95
Income tax benefit ⁽⁴⁾	—			2			1,993			—			1,995

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⁽¹⁾	As a result of the adoption of ASC 842, as of January 1, 2019, revenue generated from the lease components of lodging arrangements and conventions are no longer considered contract revenue under ASC 606, Revenue from Contracts with Customers. A portion of these balances relate to lease revenues under ASC 842. See Note 10 for further details.


⁽²⁾	Real estate leases revenue includes $71 million of variable rental income for the year ended December 31, 2019.


⁽³⁾	Amounts include changes in fair value of the derivative liability related to the conversion option of the CEC Convertible Notes and the disputed claims liability as well as interest and dividend income.


⁽⁴⁾	Taxes are recorded at the consolidated level and not estimated or recorded to our Las Vegas and Other U.S. segments.

Adjusted EBITDA - By Segment

Adjusted EBITDA is presented as a measure of the Company’s performance. Adjusted EBITDA is defined as revenues less operating expenses and is comprised of net income/(loss) before (i) interest expense, net of interest capitalized and interest income, (ii) income tax (benefit)/provision, (iii) depreciation and amortization, and (iv) certain items that we do not consider indicative of its ongoing operating performance at an operating property level. Included in Adjusted EBITDA is property rent expense of $12 million for the year ended December 31, 2019, related to certain land parcels leased from VICI.

In evaluating Adjusted EBITDA you should be aware that, in the future, we may incur expenses that are the same or similar to some of the adjustments in this presentation. The presentation of Adjusted EBITDA should not be construed as an inference that future results will be unaffected by unusual or unexpected items.

Adjusted EBITDA is a non-GAAP financial measure commonly used in our industry and should not be construed as an alternative to net income/(loss) as an indicator of operating performance or as an alternative to cash flow provided by operating activities as a measure of liquidity (as determined in accordance with GAAP). Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies within the industry. Adjusted EBITDA is included because management uses Adjusted EBITDA to measure performance and allocate resources, and believes that Adjusted EBITDA provides investors with additional information consistent with that used by management.



	Year Ended December 31, 2019
(In millions)	Las Vegas		Other U.S.			All Other			Elimination		Caesars
Net income/(loss) attributable to Caesars	$	229	$	(46	)	$	(1,378	)	$	—	$	(1,195	)
Net loss attributable to noncontrolling interests	—		—			(3		)	—		(3		)
Income tax benefit ⁽¹⁾	—		—			(141		)	—		(141		)
Other (income)/loss ⁽²⁾	1		(1		)	587			—		587
Interest expense	330		572			468			—		1,370
Depreciation and amortization	495		455			71			—		1,021
Impairment of goodwill	—		27			—			—		27
Impairment of tangible and other intangible assets	380		11			50			—		441
Other operating costs ⁽³⁾	22		22			92			—		136
Stock-based compensation expense	8		10			70			—		88
Other items ⁽⁴⁾	3		2			69			—		74
Adjusted EBITDA	$	1,468	$	1,052		$	(115	)	$	—	$	2,405



	Year Ended December 31, 2018
(In millions)	Las Vegas			Other U.S.			All Other			Elimination		Caesars
Net income/(loss) attributable to Caesars	$	392		$	(122	)	$	33		$	—	$	303
Net income/(loss) attributable to noncontrolling interests	—			2			(1		)	—		1
Income tax benefit ⁽¹⁾	—			—			(121		)	—		(121		)
Loss on extinguishment of debt	—			—			1			—		1
Other income ⁽²⁾	(3		)	(2		)	(786		)	—		(791		)
Interest expense	327			556			463			—		1,346
Depreciation and amortization	582			501			62			—		1,145
Impairment of goodwill	—			17			26			—		43
Impairment of tangible and other intangible assets	—			26			9			—		35
Other operating costs ⁽³⁾	52			21			82			—		155
Stock-based compensation expense	8			10			61			—		79
Other items ⁽⁴⁾	4			5			103			—		112
Adjusted EBITDA	$	1,362		$	1,014		$	(68	)	$	—	$	2,308



	Year Ended December 31, 2017
(In millions)	Las Vegas			Other U.S.			All Other			Elimination		Caesars
Net income/(loss) attributable to Caesars	$	484		$	(103	)	$	(749	)	$	—	$	(368	)
Net loss attributable to noncontrolling interests	—			(7		)	—			—		(7		)
Income tax benefit ⁽¹⁾	—			(2		)	(1,993		)	—		(1,995		)
Gain on deconsolidation of subsidiary	—			(31		)	—			—		(31		)
Restructuring and support expenses	—			177			1,851			—		2,028
Loss on extinguishment of debt	4			13			215			—		232
Other income ⁽²⁾	(4		)	(1		)	(90		)	—		(95		)
Interest expense	65			153			555			—		773
Depreciation and amortization	420			186			20			—		626
Other operating costs ⁽³⁾	25			3			37			—		65
Stock-based compensation expense	4			3			36			—		43
Other items ⁽⁴⁾	9			7			74			—		90
Adjusted EBITDA	$	1,007		$	398		$	(44	)	$	—	$	1,361

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⁽¹⁾	Taxes are recorded at the consolidated level and not estimated or recorded to our Las Vegas and Other U.S. segments.


⁽²⁾	Amounts include changes in fair value of the derivative liability related to the conversion option of the CEC Convertible Notes and the disputed claims liability as well as interest and dividend income.

⁽³⁾

Amounts primarily represent costs incurred in connection with development activities and reorganization activities, and/or recoveries associated with such items, including acquisition and integration costs, contract exit fees (including exiting the fully bundled sales system of NV Energy for electric service at our Nevada properties), lease termination costs, regulatory settlements, weather related property closure costs, severance costs, gains and losses on asset sales, demolition costs, and project opening costs.


⁽⁴⁾	Amounts include other add-backs and deductions to arrive at Adjusted EBITDA but not separately identified such as professional and consulting services, sign-on and retention bonuses, business optimization expenses and transformation expenses, litigation awards and settlements, permit remediation costs, and costs associated with CEOC’s restructuring and related litigation.

Condensed Balance Sheets - By Segment

	As of December 31, 2019
(In millions)	Las Vegas		Other U.S.		All Other		Elimination			Caesars
Total assets	$	13,138	$	8,509	$	6,829	$	(3,131	)	$	25,345
Total liabilities	5,896		5,730		11,519		(11		)	23,134



	As of December 31, 2018
(In millions)	Las Vegas		Other U.S.		All Other		Elimination			Caesars
Total assets	$	13,987	$	8,565	$	6,046	$	(2,823	)	$	25,775
Total liabilities	5,730		5,143		11,267		297			22,437