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 will have a question via the phone lines and instructions on how to do so 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 original view. 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 Brian Blackman, VP of Investor Relations. Sir, the floor is yours.

Thank you operator and good afternoon, and welcome to Caesars Entertainment first quarter 2017 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 website 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 first quarter 2017. Before we get underway, I would like to call your attention to certain statements and information on Slides 2 through four, which we incorporate by this reference. The forward-looking statement Safe Harbor disclaimers in our public documents cover this call and 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 discussion of certain non-GAAP financial measures, including adjusted EBITDA and adjusted EBITDA margin, property EBITDA and certain supplemental financial information. Definitions of these non-GAAP measures, reconciliations to the nearest GAAP measures, and the reasons management believe these measures provide useful information for investors can be found on Slide 3 and in the appendix to this presentation beginning on…

Okay. Thank you, Brian. And I’m pleased to report that Caesars Entertainment delivered another quarter a solid financial and operating performance driven by higher Las Vegas hotel cash revenue growth and an associated increase in cash ADR. The first quarter results reflect our continued focus on improving operating efficiency as well as the successful execution of our strategic initiatives. The positive impact of our ongoing investments in our properties especially room product is particularly evident in these results. At CEC, what you which excludes CEOC first quarter net revenues increased 1.4% to $963 million net loss was $546 million largely due to a $466 million accrual related to the restructuring of CEOC. The accrual amount is mainly driven by CEC’s stock price, because a significant portion of the liability would be settled in CEC common stock. Consequently the rise in CEC’s share price in the first quarter led to the higher accrual. Adjusted EBITDA increased 5% to $274 million, with the EBITDA margin rising 98 basis points year-over-year. On enterprise wide basis which add CEOC to CEC, first quarter net revenues decreased 1.4% to $2 billion and adjusted EBITDA grew 1.1% to $551 million. EBITDA margin increased 65 basis points to 26.9%. Decline in enterprise wide revenues was driven by lower reimbursable management cost at CEOC related to the divestiture of the Ohio properties and impact of unfavorable hold at $15 million to $20 million over the year ago period. However, Las Vegas hotel revenues and other hospitality verticals helped offset the decline. If we sort of the influence the divestiture, enterprise wide revenues were up year-over-year, we generated all time record hotel cash revenues grew two out of the three months in the quarter, leading to 9.4% year-over-year increase in this vertical. We achieve this monthly hotel cash revenue…

Thank you, Mark. I’ll start with a review of CEC’s results, followed by a review of the Company’s reportable segments and supplemental information which will include CEOC’s performance as well. Slide 18 summarizes CEC’s results, which do not include CEOC as it is not consolidated nor CIE’s social and mobile games business as it was sold in September of 2016. For the first quarter of 2017, CEC’s net revenues increased 1.4% to $963 million, mainly driven improved by Las Vegas hotel performance, this was offset by lower gross gaming revenues due to unfavorable and hold a lower gamin volume primarily at CGP. Net loss for CEC is 546 million in the quarter compared to a net loss of $308 million in the first quarter of 2016, which resulted in a net loss of $3.71 per share compared to the net loss of $2.12 per share in the year ago period. Year-over-year declines in net income and earnings per share were driven primarily by $466 million related to the restructuring of CEOC. As Mark, noted earlier as the CEC start price rises, we incur a high accrual related to the restructuring of CEOC since the significant portion of the liability will be settled in CEC common stock. Accordingly, the rise in our share price during the first quarter towards the cost that grow higher and negatively impacted net income. Due to this charge, we believe it's beneficial to provide adjusted EBITDA figures to provide visibility into our operational performance. Adjusted EBITDA increased 5% to $274 million with a margin increase of 98 basis points mainly due to higher hotel revenues and improved operating efficiencies partially offset by lower growth gaming and food and beverage revenues. Hold was estimated to have an unfavorable effect on operating income of between $10 million and…

Thanks, Eric. Please turn to Slide 25. In summary, the company’s first quarter performance reflected the continued successful execution of our strategic objectives including the positive impact of several of our newly completed renovation projects coming online. The 9% year-over-year increase in enterprise wide cash ADR is clear evidence for the value we are creating by investing in our properties and ultimately our ability to deliver and improved customer experience. Our strict focus on continuous improvement for enhanced operating efficiencies with net revenue per employee rising 7% over the last nine quarters. As we continue to execute on our cornerstone initiatives, improving an aggressive capital investment plan in place through 2020 to refresh our properties. We are laying the groundwork for further improvements in our operating performance, margin expansion, and long-term profitability. On an enterprise wide level, recent capital markets activities were reduced interest rate expense and improved future cash flows, as we seek to complete CEOC’s restructuring, we are laying the foundation for new growth opportunities to expand our network and increase shareholder value. We will now open the line for Q&A. And we would ask that you keep the questions focused on business performance please. Operator?

[Operator Instructions] And our first question comes from the line of Chad Beynon. Sir your line is open.

Hi, great. thanks for taking my question. First off, I wanted to start with margin expansion, Mark you ended with that. And more importantly just focusing on the Las Vegas property margin opportunities. You mentioned some of the efficiencies that you have initiated here and we can see the result in the margin. Can you just help us think about either flow through maybe margin upside sustainability in terms of what you’re able to produce this quarter, to just kind of give us some better goal post in terms of what some medium terms goals could be for Las Vegas margins? Thanks.

Yes, I mean I think because we have got so many rooms that will be under refurbishment for the next several years. I think the cash ADR which is a number that flows quite readily all the way through to the bottom-line that cash ADR number will continue to be significant. We haven't gotten involved in kind of predicting what it is, but we feel good about the fact that we continue to have quite a few number of rooms yet to finish if you will. And then in addition to that on kind of reengineering efforts or continuous improvement efforts, our continuous improvement program really got started and Earns last year and it's gaining momentum and we are getting more and more project, more high quality projects where we increased the number of Black Belts that we have in the company and we will continue to increase that over the next two years frankly. And so that will gain momentum we believe because these projects again, the requirement is they have to hold neutral to improve customer satisfaction and as well as improve employee engagements. So we are doing this in a very positive way and we are doing it with just sophisticated technology improvements in some cases, gives us continuous improvement, productivity, other things like the kiosk, but even just reengineering the planning that we do at the front desk or at a buffet and making sure that we turn to seats faster. So just a lot of what I would call using math and science to improve customer satisfaction through continuous improvement efforts, that’s going to continue when we are building that into the culture. I would say that we are not even half way through that journey yet.

Okay, thank you. And then turning to CEOC’s first quarter performance, you noted that the result was affected by lower casino revenues, we have seen from a lot of the regional gaming operators that things did turn more positive as we got further along in the quarter. Can you confirm that this happened with you guys and maybe just kind of an overall outlook in terms of how you are viewing the general regional business at this time given that January and February months had some difficult weather and difficult calendar and it appears to turn more positive way? Thank you.

Sure Chad, this is Eric. Yes, it was a very interesting quarter from a calendar perspective. New Year had a odd effect on January and then you know in February due to leap year there was a day less. There is also the tax return phenomenon and as a result when you look at the gaming revenues published by the states and the commentary of our competitors and we would echo the same results here. January and February were fairly challenging months and then March was quite robust. I would say at this point due to all of the different factors affecting the first quarter, it's very difficult for us to tell whether there has really been a change in any of the trends that we saw last year. We will hopefully have the results in March continue, but I think it's too early to predict anything along those lines. Broadly speaking, we continue to see weakness in the Louisiana Mississippi region and again we have talked about some in past calls where we believe that that is primarily driven by the local economy being focused on the oil and gas industry given the change in pricing and lapping some of the reductions in the oil pricing. Hopefully that will subsides. And then the rest of the regional markets as I mentioned were fairly volatile month-to-month and so I hate to call it trend at this point in time given that that volatility caused by the calendar shifts and what tax turns.

And I'll just add to Eric's comments. I think that obviously we have our own internal plan and never stretched plan, I mean we pretty much I would say predicted what the gaming demand has been as well as the hospitality demand. We feel like we have been exceeding our plans so there has been those surprises to the down side. But March it was a positive month, we saw some nice kind of what I would say continuation of those trends in the first couple of weeks of April. So again we are hopeful, but it's too soon as Eric said to predict exactly what this is going to mean the rest of the year. But overall we feel pretty good about where we are from our plan standpoint and that we have been exceeding our plan so.

Great, thanks. I'll jump back in the queue. Thank you.

And our next question comes from the line of David Farber [Credit Suisse]. Sir, your line is open.

I had just three questions. I wanted to first just on the operations side, there continues to be a significant amount of investment in Las Vegas from you and your competitors in both the hotel product and some large non-gaming projects. I was curious given some of the underutilized land you have in the deck and you've talked about in the past if you are at all considering incremental investment in Vegas away from the hotel rooms as you build cash and what types of projects might you consider in Las Vegas or if not maybe otherwise in other states the jurisdictions and then I had some follow-ups. Thank you.

Eric and I will both answer this, but I certainly believe as this is one of the biggest investments thesis for us going forward post the merger and so as that we have a lot of great, great land available that is obviously underdeveloped right now center strip and we you might imagine we have talked a lot about that internally and we have a lot of plans. And as those plans are well defined and we think they are very great projects that have nice significant returns to them and its efforts are near and dear to our heart and so we feel positively about the future and our development of Las Vegas. Eric you do want to add to that on regions as well as anything else in Vegas.

Yes, the thing I would add David is that, that we do continue to be very bullish on Las Vegas as a market, when you think about those supply and demand dynamics in this market it's positive for the existing operators. The supply from both Southern California as well as the air traffic continues to show that there is strong demand as well as the group business keeps holding up and then from the demand perspective and then from the supply perspective there doesn’t seem to be a much expansion on the horizon at least in the next two to three years. And so from that dynamic when you get high hotel occupancy rates as we have seen, your ADRs can really rise and that's what we are experiencing here in Las Vegas. So from that standpoint, we continue to believe our investment in the room products is a very good one, as we have seen this year we are planning to renovate around 7,000 hotel rooms which will be a very large effort on our part significant amount of capital and much higher than what we would expect to invest in future years and we do expect to get solid returns from those. As mark mentioned, we have sizeable land holdings on the east side of approximately 80 to 90 acres and then we own about seven acres of undeveloped plan in front of Caesar’s towers all of which would be prime for potential development from additional convention space to retail to other confidence that our customers would desire.

Okay, very good. Just on CEOC for a minute, there has obviously been some very strong results over the past year especially in the margin side. You spoke to us a little bit in the Q&A, but I guess my question is given the magnitude of the improvement and then this first quarter’s results, curious if you think we may get a peak perhaps in EBITDA, absent new revenue or how do you guys think about CEOC, if the EBITDA or it’s margin profile going forward given that improvement over the last year plus. And then I had one quick question on the cash structure. Thanks.

I guess, you know my comment would be that we feel like there is still plenty of runway for improvement, we have again I mean very methodical about how we govern the rate of improvement, because we don’t want to overly stress the organization on the plans that we have, we have a lot of plans yet for improvement to go forward with. And I think that this quarter I think you heard us talk about what I would call bad hold if you will year-over-year, and as well as having 90,000 room nights out. So there is a lot of moving pieces, but as you kind of neutralize those pieces and normalize and again for us a solid quarter and within feeding our plan and I think that we have tried to make sure that the fast-forward has not only a lot of growth in it, saw growth initiatives, some of those were starting to really kick-in now. We work really hard on our application on total rewards we have worked really hard on mobile booking in our websites and those initiatives are really paying off for us.

Okay. Thanks for that. And the just quickly, you have been in the loan market recently, I was curious to hear if there is any updated thoughts on what CEOC’s emergence could look like. You talked about the second half of the third quarter and I guess my question specifically is there any updated thoughts on potential refinancing for the high yield portion of either CERC or growth venture partners? Thanks and that’s it.

Sure David, as you know we have been fairly active in the loan market with respect to securing the CEOC exist financing. We also re-priced our CGPH facility and upsized to take advantage of rates with respect to retiring the Cromwell debt pending regulatory approval. And then we are in the market to CERP term loan. It’s not a lost on us that there is a additional potential opportunity with respect to the bonds. The bonds do come with associated call premium and also they would be refinanced with other bonds then there would be additional if we were to eventually refinance the entire structure and to complete merger of the two facilities. We were certainly active in discussions in and outs as trying to figure out the best way to optimize our cost-to-capital. So rest is shared we are looking at all the possibilities and we will take advantage of the market conditions when they present themselves, but right now we are primarily focused on CERP term loan with pricing and making sure that we are able to exit the restructuring as soon as possible.

Very good. Thanks for taking all the questions.

And our next question comes from the line of [Michael Keith] (Ph). Sir, your line is open.

Hi thank you. Actually just a follow-up on a last one a little more, Eric just relative to emergence, are you able to consider merging CGP and CERP prior to that, do we need to wait for that? And then as it relates to potentially considering refinancing bonds, is that also something that it needs to wait for those two events to happen? And do your current credit facilities that are new allow an easy path to that? Thank you.

Yes, so unfortunately I don’t have a clear answer for you because we do evaluate all the options based on how the market conditions are and all the information that we have at the time as I mentioned to try to come up with a ultimate capital structure that has lowest cost to capital for the company. In this particular case, merging the two facilities is particularly challenging given that they are currently owned by two different public companies. And so that likely we have to wait until after the emergence simply from a practical nature of the collateral being held by two different entities. The term loans that we are currently repricing should not have any impact or negative cost associated with any of our future actions, they both will consist of a tougher repricing of six months but otherwise they can be retired at par. So the actions that we are taking with respect to CGPH and CERP should have no negative effects long-term with respect to our capital decisions. And from a positive side it allows us to take advantage of the current market conditions and lock-in some of the strong interest savings that we can anticipate to realizing the future.

Thanks. And then Eric, you also talked about a $20 million hold headwind in the second quarter of this year and then there was something else you mentioned with salaries, I’m sorry I missed that so some clarity there? And then that the hold headwind was that enterprise wide and if it was is there any rough numbers you can give on the three silos?

Sure, so the enterprise wide Hold impact was about $20 million plus. We didn’t provide guidance broken up by the various silos but just wanted to highlight. And to your second question with respect to the salaries and wages as we go through with various contacts with our employees as well as increases in salaries and benefits there is general inflation that comes through with respect to those categories. Our expectations are where that we challenge our management team to offset those is increases productivity actions, however we do like to call out the fact that we are experiencing increases from an inflationary perspective in those categories.

Thanks and then just one last one, where do you expect to be at year-end 2017 in terms of percentage of property renovations and then just looking forward how much more do you have to do in the years following 2017? Thank you.

Yes, as you know we were very active, we have got slightly over 35% of our rooms completed now and we would anticipate at the end of 2017 to be at around 56% completed and that's completed since the 2014 so these will be a very fresh room night. As I have mentioned previously as we anticipate this year being our peak CapEx year and going forward we would expect to continue at a slowly elevated pace about our long-term capital requirements would need, but we will be able to do fewer and fewer rooms in 2018, 2019 and 2020 before getting down in 2021 to a flat run rate over the long-term expected amount of capital that we would be spending.

Great. Thank you guys.

And our next question comes from the line of John DeCree [Union Gaming]. Sir, your line is open.

Hey everyone, thanks for the questions. If I could just build on the last question, Eric given how the how high the ROI has been on the room renovations and this year being up of the peak CapEx year. Is there any thought or opportunity to pull some of the room renovations from 2019 or 2020 forward a little bit to begin renting that up or is it just maybe too much inventory disruption.

Yes, it's a good observation and I'll make a couple of comments on that one is our current plan does really do what your describing, which is that we have accelerated along of the room renovations into this year because we felt that the return were so strong and because of our performance over the past two years it supported us the ability to have the cash side in the various credits to be able to perform those activities. As you have seen and as we highlighted we do have construction disruption that we have to then offset through various means so it's somewhat disruptive. Going forward however once we have this year done, we believe that we will have a core group of rooms and with the 56% that will be sufficient quantities at all of our properties to handle the group business as well as the casino business and thus the urgent need to upgrade the product isn’t as necessary and therefore we are able to back-off and slow it down a little bit. The other thing I would comment is that although we are experiencing strong improvements in ADR from these renovated rooms and thus high returns on that capital that we are investing at some point that's going to diminished. Once we get a certain percentage of the room nights complete the marginal room that's renovated doesn’t provide the same return that the earlier rooms provided. And when that happens we don’t know, at this point we are still experiencing a good returns on these projects, but at some point in the future that will flip and just become more and maintenance related project as opposed to driving growth.

Got it, that's really helpful. Thanks. And then maybe higher level question Mark, I think you guys have both discuss a little bit about potential development opportunities in Las Vegas, I was wondering as the rework of CEOC kind of comes to a conclusion hopefully at the end of 3Q how you guys think about some other strategic priorities whether would be M&A or potentially development outside of Las Vegas. Any high level comments on how you are kind of thinking about that going forward?

I think it's fair to say that we have had a lot of time to plan and look at projects outside of Las Vegas and we have got a pretty good list of what I would call targets I guess and Eric and the team have done a really good job identifying what those are, what we think the expected returns would be and were fairly bullish, that we will be able to generate some good inorganic growth through M&A activity as well as activity as well as licensing opportunities, we have cadre of about five different categories of growth that once we emerge we will be able to start executing again. So we are pretty prepared for that and excited to be able to start talking about it once we emerge.

Great. Thank you, everyone.

And we have a follow-up question Chad Beynon. Sir, your line is open.

Thanks for taking my follow-up. Just a maintenance question. Eric regarding the classification of the [indiscernible] property, is this now excluded or was this excluded from the quarterly consolidated EBITDA and kind of your LTM rolling historical EBITDA number?

Yes, that’s correct. The deconsolidation of [Indiscernible] from 2016, Q1 perspective, if you recall our prior reporting said $304 million of EBITDA, and now we are showing $284 million and that’s to request the removal of [indiscernible] and it’s also reflected in the current period. The one thing I would also note for those building model is that it was also excluded from any of the information that we included in our S4. So those projections are also excluded [Indiscernible].

Okay, very helpful. Thank you very much. That’s all from me.

Thank you.

Thank you.

And now, I would like to turn it back over to Brian Blackman for closing remarks.

Alright. With that, on behalf of the company would like to thank everyone for joining us on today’s call, and we look forward to checking back few months for our second quarter results. Have a great day.

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