Penn Entertainment, Inc. · NASDAQ:PENN
Penn Entertainment — Q3 2023 Earnings Presentation
22 slides from Penn Entertainment's earnings presentation, Nov 2, 2023
Slide 1: Third Quarter 2023 Earnings Presentation
THIRD QUARTER 2023 EARNINGS PRESENTATION November 2, 2023
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the use of forward-looking terminology such as “expects,” “believes,” “estimates,” “projects,” “intends
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES The Non-GAAP Financial Measures used in this presentation include Adjusted EBITDA, Adjusted EBITDAR, Traditional Net Debt, Lease-Adjusted Net Leverage and Retail Free Cash Flow. These non-GAAP financial measures should not be considered a substitute for, nor superior to,
Slide 4: Balance Sheet & Liquidity Position
BALANCE SHEET & LIQUIDITY POSITION DEBT MATURITIES(1) Cash Balance $1,318 Undrawn Revolving Credit Facility Liquidity(2) $2,296 $1,000 Total Traditional Debt $2,662 Traditional Net Debt(3,4) $1,344 $990 $523 Lease-Adjusted Net Leverage(5) 4.7x Traditional Net Leverage(6,7) 1.4x $400 $400 $330 % of F
Slide 5: Strong Retail Free Cash Flow
STRONG RETAIL FREE CASH FLOW Our geographically diversified portfolio of best-in-class properties generates significant free-cash flow Retail Free Cash Flow ($M) LTM Cash from Operations $659 (+) Cash Outflow from Interactive Segment* $239 Cash from Operations $898 (excl. Interactive) (-) Maintenanc
Slide 6: Illustrative 3-Year Cash Generation
ILLUSTRATIVE 3-YEAR CASH GENERATION Our strong retail free cash flow generation enables us to accumulate cash, invest in our exciting growth initiatives, return capital to shareholders and de-lever over time ($M) Illustrative 3-Year Cash Generation* $3,500 $1,721 ** 3-Year Cash Generation $3,000 in
Slide 7: Implied Company Valuation
IMPLIED COMPANY VALUATION Our stock is trading well below historical trading multiples, and our strong balance sheet and cash flow generation provide the ability to opportunistically repurchase shares under our existing $750 million share repurchase authorization Implied PENN Entertainment Valuation
Slide 8: Promos
Promos sersip @ NOVEMBER 147H* Ee Sriilbel Bowne BH8 Straight $100.00 * Subject to final approvals
Slide 9: Product Features
– PRODUCT FEATURES Parlay+ Quick Bets Featured Bets Shareable Bet Slips ESPN Play of the Day Product offers wide Seamless navigation to Featured Bets will ESPN BET shareable range of same-game Quick Bets provides consistently leverage the bet slips will allow parlays via Parlay+, bettors with an enh
Slide 10: Integrations
– INTEGRATIONS • ESPN BET presence across ESPN linear and digital platforms • ESPN BET featured as exclusive odds provider • ESPN BET branded, standalone 6-pack odds (Spread, Total, Moneyline) and other integrations into ESPN.com Web & Mobile Web will be introduced over the upcoming weeks Pre-Launch
Slide 11: Powerful Brand, Widest Reach
– POWERFUL BRAND, WIDEST REACH Exclusive Access to Industry's Widest Reach, Including Opportunity to Enhance Conversion of Existing the #1 Fantasy Sports App in the U.S. Database with #1 Brand in Sports 200m 2m 27m+ Multiplatform Users Total Digital Total Loyalty Registrations* Members • #1 Sports A
Slide 12: Ontario: A Case Study for Success (Cont.)
ONTARIO: A CASE STUDY FOR SUCCESS (CONT.) Our integrated media strategy with theScore and theScore Bet in Ontario is providing a blueprint for success that we intend to replicate in the U.S. with ESPN BET Media Sports Betting iCasino Media Ecosystem Cross-Selling Conversion Strategy 73% >50% of Tota
Slide 13: Ontario: A Case Study for Success (Cont.)
ONTARIO: A CASE STUDY FOR SUCCESS (CONT.) Strong year-over-year performance in Ontario after launching on our proprietary technology stack demonstrates impressive retention from our improved, vertically-integrated product Y/Y Q3 GGR Y/Y Increase in Monthly Active Users +105% +21% We are converting O
Slide 14: Retail Growth Projects
RETAIL GROWTH PROJECTS We expect to break ground on all four exciting retail growth projects later this year, which we expect to deliver attractive returns upon opening in Q4 '25 / Q1 '26 Hollywood Aurora and Hollywood Joliet: • Opportunity to relocate to far superior locations with significantly hi
Slide 15: Recent ESG Highlights
RECENT ESG HIGHLIGHTS • Forbes has once again named us as one of “America’s Best Employers for Diversity 2023” and “America’s Best Large Employers 2023.” • Newsweek added us to their list of “Greatest Workplaces for 2023” and Time Magazine named us one of the “World’s Best Companies.” • On October 4
Slide 16: Appendices
APPENDICES
Slide 17: North America's Leading Provider of Integrated Entertainment, Sports Content and Casino Gaming
NORTH AMERICA’S LEADING PROVIDER OF INTEGRATED ENTERTAINMENT, SPORTS CONTENT AND CASINO GAMING EXPERIENCES (Strategic Alliance) Strong Balance Sheet and Free Cutting-Edge Tech andExperiences, High Dynamic Brand Licensing Cash Flow Growth Digital Business and Merchandise Media Integration Our diversi
Slide 18: Historical Regional Resiliency
HISTORICAL REGIONAL RESILIENCY Regional markets performed far better than the Las Vegas Strip following the 2007-08 downturn, and the current operating environment is more favorable Gross Gaming Revenue Growth (as %)* Favorable Operating Environment 5.0% 2.6% • Rational promotional and marketing 0.0
Slide 19: Retail Growth Projects – Details
RETAIL GROWTH PROJECTS – DETAILS Project GLPI Committed Project Type Timeline Key Features Budget Funding 900 Slots; 60 Table Games Hollywood $225m (GLPI) Est. Opening: 225 Hotel Rooms Relocation $360m Aurora $50m (City of Aurora) Q1 2026 Events Center Adjacent to Chicago Premium Outlets 800 Slots;
Slide 20: GAAP to Non-GAAP Reconciliation – Leverage Ratios
GAAP TO NON-GAAP RECONCILIATION – LEVERAGE RATIOS (in millions, unaudited ) September 30, 2023 Traditional Net Debt Amended Revolving Credit Facility due 2027 $ - Amended Term Loan A Facility due 2027 515.6 Amended Term Loan B Facility due 2029 987.5 5.625% Notes due 2027 400.0 4.125% Notes due 2029
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP TO NON-GAAP RECONCILIATION For the three months ended For the nine months ended For the three months For the last twelve months September 30, September 30, ended December 31, ended September 30, ($ in millions, unaudited) 2023 2022 2023 2022 2022 2023 Net income (loss) $ (725.1) $ 123.2 $ (132.
Slide 22: Entertainment
ENTERTAINMENT