Caesars Entertainment reported a net loss of $ 233 million in the third quarter as the company’s balance sheet was weighed down by interest charges and efforts to grow the digital betting service Caesars Sportsbook.
To help pay off the debt, the company plans to sell the real estate of at least one of its hotels on the Las Vegas Strip early next year.
Caesars currently owns and operates Caesars Palace, Harrah’s Las Vegas, Flamingo Las Vegas, Bally’s Las Vegas, The Linq, The Cromwell, Paris Las Vegas and Planet Hollywood.
Rival MGM Resorts International has sold several properties in Las Vegas over the past two years while making deals to continue operating the hotels.
âWe are considering selling an asset from Strip, expect us to put it in motion in early 2022,â said Tom Reeg, CEO of Caesars Entertainment. âWe plan to be aggressive on the refinancing front in 2022 to reduce the cost of debt, and that is expected to represent well over $ 5 billion in cash to be deployed in 2022. Some will be spent on digital, and some will be spent on digital. ‘others in investment projects that generate a return on investment, but the vast majority will be used to pay off debt. ”
Caesars also expects to earn $ 1.2 billion upon closing the sale of the non-U.S. Assets of sportsbook operator William Hill. Last April, Caesars Entertainment announced the completion of its $ 4 billion purchase of William Hill, which was later renamed Caesars Sportsbook.
The Caesars Digital division, which includes sports betting, reported a net loss of $ 193 million in the third quarter.
Caesars was bought in 2020 by Eldorado Resorts, and the two companies merged, retaining the Caesars name. At the end of the third quarter, the company is in debt of $ 15.2 billion.
Hotels are profitable
Meanwhile, Caesars’ regional properties in Las Vegas and the United States posted net income of $ 272 million and $ 239 million in the third quarter, respectively.
âWe are encouraged by the booking trends, and we started to see conventions return to Vegas in the third quarter, accounting for 10% of overnight stays,â said COO Anthony Carano. “This is a dramatic improvement over the first half of the year, and we continue to expect a gradual recovery in the segment.”
Additionally, Reeg said Caesars properties were operating with a midweek occupancy cap as the company struggled to hire enough maintenance staff.
“We are fighting across the country to hire enough room attendants,” he said.
Caesars Entertainment’s third-quarter revenue totaled $ 2.7 billion, compared to $ 2.5 billion in the second quarter.
The company returned to net profitability in the second quarter, posting net income of $ 71 million after reporting a net loss of $ 423 million in the first quarter.