Hello. And welcome to today’s webcast. My name is Jen and I’ll be your Web event specialist today. All lines have been placed on mute to prevent any background noise. Please note that today’s webcast is being recorded. We’ll have a question-and-answer session at the end of today's presentation and instructions on how to ask a question will be given at the appropriate time. If you would like to view the presentation in a full-screen view, click the full screen button in the lower right-hand corner of your screen. Press the escape key on your keyboard to return to the original view. For optimal viewing and participation, please disable your pop-up blockers. And finally, should you need technical assistance, as a best practice, we suggest you first refresh your browser. If that does not resolve the issue, please click on the support option in the upper right-hand corner of your screen for online troubleshooting. It is now my pleasure to turn today’s program over to Mr. Brian Blackman, Vice President of Investor Relations for Caesars Entertainment. Brian, the floor is yours.

Thank you. And good afternoon. And welcome to Caesars Entertainment second quarter 2016 results conference call. Joining me today from Caesars Entertainment Corporation are Mark Frissora, President and Chief Executive Officer, and Eric Hession, Chief Financial Officer. A copy of our press release, certain earnings presentation slides and a replay of this conference call are available in the Investor Relations section on our Web site at caesars.com. The slides are available for download and will accompany Mark and Eric’s prepared remarks for those of you on the phone that would like to follow along. Also, please note that prior to this call, we furnished a copy of this afternoon’s press release to the SEC in a Form 8-K and will shortly file our most recent quarterly report on Form 10-Q for the second quarter of 2016. Before we get underway, I would like to call your attention to certain statements and information on slides one through four, which we incorporate by this reference. The forward-looking statements, Safe Harbor disclaimers in our public documents cover this call in a simultaneous webcast at caesars.com. This call, the webcast, and its replay are the property of Caesars Entertainment Corporation. It’s not for rebroadcast or use by any other party without the prior written consent of Caesars Entertainment Corporation. If you do not agree with these terms, please disconnect now. By remaining on the line, you agree to be bound by these terms. Today's call will include a discussion of certain non-GAAP financial measures including adjusted EBITDA and adjusted EBITDA margin, proper EBITDA and certain supplemental financial information. Definitions of these non-GAAP measures, reconciliations to the nearest GAAP measures, and the reasons management believes these measures provide useful information for investors can be found on slide three and in the appendix to this presentation…

Thank you, Brian. I’m pleased report that Caesars has continued to build on our 2015 full year and first quarter 2016 performance by posting strong second quarter results. These results continue to benefit from the strategic initiatives that we've been executing during the last year-and-a-half focused on operational efficiency and investments in our hospitality assets, which are driving improved revenue and margin performance. As seen on slide six, net revenues for CEC, which excludes CEOC, increased 8% to $1.2 billion and net income declined $2.1 billion resulting in a net loss of $2 billion. The year-over-year decline in net income was due to an accrual of approximately $2 billion related to CEC's estimate of the additional amount it will pay to support the bankruptcy of CEOC and a year-over-year increase in CIE stock-based compensation. Eric will provide further details during his remarks. Adjusted EBITDA for CEC grew 12% to $388 million and adjusted EBITDA margin expanded 113 basis points to 31.5%. At an enterprise-wide level, which as a reminder includes CEC and CEOC performance, net revenues grew 2% to $2.4 billion and adjusted EBITDA increased 8% to $697 million. Adjusted EBITDA margin expanded 145 basis points to 29.5%. Enterprise-wide, the key drivers of second quarter revenue and EBITDA performance were the same as those I discussed during the first quarter. We continue to experience growth in hospitality revenues, primarily lodging and entertainment in Las Vegas, with enterprise-wide cash ADR at an all-time high for the second quarter which grew 7.5% year-over-year. The Interactive Entertainment business delivered growth by increasing unique paying users and average revenue per user. These positive drivers These positive drivers were partially offset by weaker gaming volumes and regional markets, primarily in the Southeastern United States. Gaming volumes in May and June were particularly weak in the…

Thank you, Mark. I’ll start with a review of CEC’s consolidated results followed by a review of the company's reportable segments and supplemental information, which includes CEOC’s performance as well as enterprise-wide results, inclusive of CEOC. Slide 18 summarizes CEC’s results, which do not include CEOC as it is no longer consolidated. For the second quarter of 2016, CEC’s net revenues rose 8% to $1.2 billion. Net loss was $2 billion compared to net income of $500 million in the second quarter of 2015. Diluted loss per share for CEC was $14.25 compared to diluted earnings per share of $0.10 in the year-ago period. Net income and earnings per share results were largely driven by restructuring-related accruals, which I'll discuss in a moment. Adjusted EBITDA grew 12% to $388 million, with a margin increase of 113 basis points. Revenue in the quarter was driven primarily by strong growth in hospitality revenues in Las Vegas, organic growth in social and mobile games at CIE, and gaming revenue growth at Horseshoe Baltimore. This was partially offset by lower gaming revenues, primarily in Atlantic City and Las Vegas. Year-over-year improvement in adjusted EBITDA was mainly due to the net revenue increases and improved hotel customer mix and efficiency initiatives. Earnings performance for CEC was primarily attributable to an accrual of approximately $2 billion in the second quarter related to CEC’s estimate of the amount it will pay to support the restructuring of CEOC as well as a $66 million expense related to the fair value adjustment of CIE stock based on compensation awards. We believe our accruals represent the best estimate of our obligations under the restructuring. However, because negotiations between the various parties are ongoing and the amended plan is pending ultimate approval by the Bankruptcy Court and also pending the receipt…

Thanks, Eric. Summarizing our discussions on slide 27, we're pleased with our second quarter performance, which increasingly reflects progress executing our cornerstone initiatives. Our focus on enhancing hospitality assets is a key business performance driver, while our efficiency initiatives are enabling us to maintain the margin improvements we've achieved over the last six quarters. By continuously improving the operating model and investing in the business, we will be able to accelerate revenue growth and drive productivity gains. The goal of this approach is to further improve margins and cash flow, while also further improving customer and employee satisfaction. While macroeconomic indicators are currently mixed for consumer spending, regional gaming markets in our industry have shown some recent softness, which we will continue to monitor. Nevertheless, we are somewhat encouraged by our recent market share gains in certain markets. We will continue to stay focused on our balanced approach to running the business, an equal focus on revenue generation and cost management as well as customer and employee satisfaction. We believe that this approach, along with executing our stated strategic initiatives, is the best hedge against uncertain economic trends. As always, amid the backdrop of ongoing restructuring efforts at CEOC, we're focused on operating as efficiently as possible to maximize value for all stakeholders. Over the last several months, we’ve made significant progress in the CEOC bankruptcy case, as outlined on slide 28. We’re optimistic that achieving these milestones puts us on a path to resolving the unit’s bankruptcy. Yesterday, we announced the signing of a new restructuring support agreement with a significant portion of CEOC second lien holders. This milestone signals continuing progress in CEOC’s negotiation efforts with its lenders to bring that entity out of bankruptcy. The RSA will become effective upon the signing of the RSA by creditors holding at least 50.1% of the aggregate outstanding amount of CEOC’s obligations by the end of August. Further, if consenting creditors holding at least two-thirds of the aggregate second-lien bond claims sign the RSA, we could potentially have a fully consensual deal ahead of CEOC’s confirmation hearing in January. We will now open the line up for Q&A. We’d ask that you please keep your questions focused on the business performance. Operator?

[Operator Instructions] And your first question comes from the line of Susan Berliner from JPMorgan. Your line is open.

Hi. Thank you. So I want to start, I guess, with the consumer. I know you guys talked about the consumer gaming spend being lower in the regional markets and it sounded like it continued into July. And I was wondering if you can talk about what you're hearing from your customers. Is it just slot play? Is it at all with regards to F&B as well?

Sure. I’ll start and then Mark can add some context. We did notice some softness in May and June and it trended a bit into July, but not as weak as we've seen in May and June. A lot of the weakness was focused around the southeastern part of the United States, which we believe is adversely affected by the oil and gas price situation. And then the rest of the central division also experienced slight weakness that was not in the same line that we have seen through the first four months of the year, which is why we mentioned it here. We also continually take an approach by evaluating all of our marketing campaigns and all of our operating strategies to try to mitigate any weakness that we see. And so, as we mentioned in the materials earlier, we’ll be very vigilant to make sure that we’re able to maintain our margins and that we do react appropriately as we see these threats coming through. From the Vegas perspective, though, I would say that the Vegas market, we continue to be optimistic. The demands for the market from the free and independent traveler are continuing to be strong. And then to address your question directly from the food and beverage perspective and the entertainment perspective, the consumers do seem to be purchasing those products in a strong way. So we’re not concerned on that side.

And then just turning to CapEx, I didn't see in the slides or in the press release CapEx at each entity. Can you go over that? And then, just discuss what, I guess, the major renovations are at CERP and CGP.

Sure. I can run through them here. So, at CERP, in the second quarter, we spent $32 million of capital, CGP was $21 million, CES was $2 million, and then CEOC was $38 million, for a total of $93 million. We did provide in the materials an updated range of CapEx, which you’ll see was slightly higher on the bottom end, but we kept the top end of the range the same. The predominant projects that we have coming up in the second half of the year are room renovation projects. At CGP, we’re embarking on a significant room renovation effort at Planet Hollywood. And at CERP, that's predominantly focused on room renovations at Paris right now.

Great. And then I just want to try to figure out – I guess, with the CIE, congrats on that. Can you guys talk about what the proceeds will be used for? And then, if you can talk about if there are any other potential assets for sale such as Baltimore.

Due to the recency of the sale, we’re not commenting at this point on the use of the proceeds. There was some disclosure around the payments that can be made for professional services, minority investors in the entity and a few other distributions. But other than that, we’ll comment on that at a later date. And then with respect to additional asset sales, again, nothing to comment on there. We don't have, at this time, any plans to divest further assets.

Great. Thank you.

Sure.

And your next question comes from the line of John DeCree from Union Gaming. Your line is open.

Hi, everyone. Thank you. Just wanted to go back quickly to some of the color you provided on the regional gaming customer. And I was wondering if you're seeing any change in the promotional environment with some of your competitors in the regions where perhaps the consumer is a little softer.

Yeah. I would say, at this point, consistent with what we’ve been trying to undertake for the last six quarters really, we've been trying to rationalize our investment with respect to the various segments, particularly in Midwest regions, but also in Las Vegas to some degree. We really drive down to that particular segment level and try to titrate our marketing efforts to achieve the maximum results that we can. We have seen a moderating competitive dynamic in terms of reinvestment levels, but I would say that that’s also been fairly consistent now for the last six months. So a little bit different than in 2015. So at this point, I would say that there really don't seem to be any strong trends from an increasing reinvestment perspective for many of the competitors that we see. And this is broadly speaking, of course, across the portfolio.

Okay, very helpful. And to switch gears into Las Vegas, I think some, obviously, really good data points as it relates to the non-gaming business that are pretty consistent across the board. I was wondering if you can add a little more color to your views on the gaming business, the casino floor, if you’re expecting any particular growth in that area or any improvements in terms of casino revenue growth in Las Vegas.

I’d say, broadly speaking, in contrast to the non-gaming side where we are definitely seeing an increase in both the hotel demand, the food side and the entertainment side, the gaming side has been up a few percent for the past six months. We did have a strong second quarter with respect to baccarat business. But at this point, it's too early to tell whether that’s going to continue. And as you know, that's certainly been a challenged segment for the prior five or six quarters before that. As Mark mentioned in his notes, we’re actively searching for new product offerings that we can deliver to the floor. We do plan to roll out three test areas across our brand, with one of them being in Las Vegas that we believe will contain new products that will be very appealing to the millennial generation and will help really drive people in and reenergize the gaming side.

Great. Thanks, Eric. Really appreciate the questions.

Sure, thank you.

And there are no further questions at this time. I turn the call back over to the presenters.