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Jun 30, 2020
Caesars Q2 2020 Earnings Report
Caesars Entertainment, Inc. reported a net loss due to property closures and reduced operations related to the COVID-19 pandemic, but merger completed in July positions company for future recovery.
Key Takeaways
Caesars Entertainment, Inc. reported second quarter results, which were significantly impacted by the COVID-19 pandemic, with the majority of properties remaining closed during April and May. Net revenue for legacy Eldorado Resorts properties was $126.5 million, a decrease of 80.1% compared to the prior-year period. The company reported a net loss of $100.0 million, compared to net income of $18.9 million in the prior-year period. The merger between Eldorado Resorts and Caesars Entertainment Corporation was completed on July 20, 2020.
Net revenue for legacy Eldorado Resorts properties decreased by 80.1% on a GAAP basis.
Net loss of $100.0 million compared to net income of $18.9 million for the comparable prior-year period.
Same-store Adjusted EBITDA for legacy Eldorado Resorts was negative $10.4 million.
Eldorado Resorts and Caesars Entertainment Corporation completed their merger on July 20, 2020.
Caesars
Caesars
Forward Guidance
The report does not contain specific forward guidance. However, the CEO expressed optimism regarding an eventual recovery of travel and tourism in the U.S. and especially Las Vegas.
Positive Outlook
- All of the combined new Caesars Entertainment, Inc. regional properties are now reopened.
- The company is encouraged by operating trends.
- Operating teams are fully engaged with integrating the two companies and executing on synergy plans.
- The company's priority remains the safety and security of Team Members and Guests.
- The company remains optimistic regarding an eventual recovery of travel and tourism in the U.S. and especially Las Vegas.
Challenges Ahead
- Second quarter operating trends were negatively impacted as the majority of properties remained closed during April and May 2020.
- COVID-19 operating plans are in place for reopened properties.
- The company faces risks related to the combination of the Company and Caesars Entertainment Corporation (CEC) and the integration of their respective businesses and assets.
- Potential adverse reactions or changes to business or employee relationships could occur.
- There is a possibility that the anticipated benefits of the merger, including cost savings and expected synergies, are not realized when expected or at all.