Brian Blackman - IR Mark P. Frissora - CEO and President Eric Hession - CFO.

Susan Berliner - J.P. Morgan Securities David Farber - Credit Suisse John DeCree - Union Gaming.

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It is now my pleasure to turn today's call over to Brian Blackman, Vice President, Investor Relations. Brian, the floor is yours..

Thank you and good afternoon, and welcome to Caesars Entertainment Third 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 third quarter of 2016.

Before we get underway, I would like to call your attention to certain statements and information on slides 1 through 4, which we incorporate by this reference. The forward-looking statement Safe Harbor disclaimers in our public documents cover this call and the 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 Slide 24.

These non-GAAP measures are not preferable to GAAP results provided elsewhere in the presentation or discussed on this conference call. As a reminder, Caesars Entertainment Corporation is a holding company with the following consolidated entities, Caesars Entertainment Resort Properties and Caesars Growth Partners.

Through the second quarter of 2016, we aggregated the operating segments within CGP into two separate reportable segments, CGP Casinos and Caesars Interactive Entertainment.

Given the sale of CIE's social and mobile game business in the third quarter, which represented the majority of CIE's operations, CIE is no longer considered as separate reportable segment from CGP Casinos based on management's view. Therefore, CGP Casinos and CIE have been combined for all periods presented to form the CGP segment.

CEC also has a majority ownership of Caesars Entertainment Operating Company, but CEC's financial results do not include the results of CEOC and its subsidiaries following its Chapter 11 filing on January 15 of 2015.

However, in addition to a review of CEC's reported financial information on this call, we will also discuss certain supplemental financial information regarding CEOC, including certain remarks that combine CEOC's results with those of CEC.

CEC has committed to a material amount of payments to support CEOC's restructuring which would result in the reacquisition of CEOC's operations if the restructuring is made on terms consistent with the current restructuring support agreement to which CEC is a party.

As a result, this non-GAAP supplemental financial information is presented as a benefit to the users to understand the results of the entire Caesars Enterprise, including CEOC, and consistent with the management service provided across all properties. The results are not indicative of future performance or the results post restructuring.

As used during the call, the words, Company, Caesars, Caesars Entertainment, we, our, and us, refer to Caesars Entertainment Corporation and its consolidated entities unless otherwise stated or the context requires otherwise.

As seen on today's agenda on Slide 5, we'll begin the call today with some remarks by Mark whose comments will generally relate to the entire Caesars Enterprise, including our deconsolidated subsidiary, CEOC.

Eric will then review our financial results before Mark concludes with some closing comments, and we will then open up the call for your questions. I'd now like to turn the call over to Mark..

Thank you, Brian. In the third quarter, we delivered year-over-year improvement in our financial performance as we continued to execute against our strategic and operational objectives. These performance improvements are a direct result of our ongoing investment in hospitality assets and our focus on continuous improvement.

Turning to Slide 6, net revenues for CEC, which excludes CEOC and our recently sold social and mobile games business, increased 3% to $986 million.

Net income increased $761 million to $5 million positively, mainly due to a gain on the sale of the SMG business which closed on September 23, offset by an additional accrual to support the restructuring of CEOC.

As you may recall, Caesars Interactive announced in August that it had agreed to sell its SMG business for $4.4 billion in cash to a consortium of Chinese investors led by Shanghai Giant Network Technology. Adjusted EBITDA for CEC increased 9% to $269 million and adjusted EBITDA margin expanded 158 basis points to 27.3%.

At an Enterprise-wide level, which includes CEC, CEOC and our recently sold SMG business, adjusted EBITDA increased 1% to $638 million. Enterprise-wide performance was impacted by a significant unfavorable hold with an estimated year-over-year EBITDA impact between $30 million and $35 million.

Hospitality revenues remained a key driver of performance with Enterprise-wide cash ADR increasing 9% year-over-year to an all-time high of $136 and strong growth in Las Vegas entertainment. Additionally, we continue to generate marketing and operational efficiencies which help mitigate inflationary wage pressures in Las Vegas and Atlantic City.

Hold adjusted revenue per employee grew 4.5% year-over-year in the quarter. These positive drivers were offset by unfavorable year-over-year hold, predominantly at Caesars Palace and Harrah's New Orleans as well as weaker gaming volume trends in the Southeastern United States.

Since our last call, there has been significant progress towards an ultimate resolution in the CEOC bankruptcy proceedings. Last month, all of CEOC's major creditor groups signed amended restructuring support agreements and have agreed to the terms of the latest plan of reorganization.

This is a key milestone in CEOC's efforts to implement a consensual restructuring and paves the way toward a successful conclusion of CEOC's bankruptcy in 2017.

Once the restructuring is complete, management will be able to turn its full attention towards our strategic priorities, which we believe will continue to drive value to all of our stakeholders.

As I have mentioned on previous calls and can be seen on Slide 7, our cornerstone initiatives are a critical component of our plan to expand margins and to grow cash flows through revenue and efficiency initiatives while driving employee engagement and customer satisfaction.

Beginning on Slide 8, we continue to make progress enhancing our hospitality and loyalty programs with the goals of expanding our customer base and increasing customer engagement. We remain focused on growing adoption of Total Rewards App.

The app allows us to engage directly and in real-time with customers before, during and after they visit our properties. As a result of our updated design and content, new user installations and user sessions have risen 55% and 62% respectively over Q3 of last year.

In addition, we've had initial success is fostering a more direct relationship with our customers through Caesars.com.

As a result of improvements to the mobile booking experience, we have seen greater traffic and bookings through our mobile Web-site and conversion, defined as the percentage of users that execute a successful transaction, is up 14% year-over-year through September.

This has generated incremental hotel revenue as well as benefited our Total Rewards enrolment, which has increased 33% year-over-year through this channel. We've been recognized for our efforts on our loyalty program, recently winning two awards at this year's Mega Awards.

The Mega Awards are one of the travel industry's highest accolades recognizing innovation in the airline and travel business. Caesars Entertainment won the Loyalty Innovation of the Year category for our ability to integrate the Total Rewards program with mobile technology.

Our Total Rewards Visa Card also won Innovation of the Year in the Travel Co-Brand Card category. Turning to slides 9 through 11, investing in our infrastructure is another important cornerstone priority with a heavy focus on refreshing our hotel room product.

During the quarter, we completed the previously announced renovation of the Augustus Tower at Caesars Palace and began to renovate a combined 3,400 room at Paris and Planet Hollywood. We are preparing to start the Palace Tower renovation at Caesars Palace currently scheduled to begin in the first quarter.

This will bring our total renovated room product to over 10,000 rooms or approximately 44% of our Las Vegas portfolio since 2014. Continuing with our Las Vegas masterplan is a high-return opportunity for us with cash ADR increases ranging from $25 to $40 per room at our recently renovated hotel towers in the region.

Similarly, we are taking steps to update our hotel product in regional markets. In September, we announced the renovation of the Bayview Tower at Harrah's Atlantic City, which are the most convenient set of rooms for guests visiting our Conference Center.

This is the latest in a series of enhancements at the resort, including planned improvements to The Pool After Dark, the construction of the new fitness center and upgrades to our Food Court.

The renovation will help us to maximize performance of the adjacent Waterfront Conference Center by enabling us to deliver a more competitive room product, which will translate into incremental cash ADR and banquet revenues.

Complementing our room renovations, we are investing in our food, beverage and entertainment at Caesars Palace offerings to stimulate the incremental visitations to our properties. In Las Vegas, we've opened the Alto Bar at Caesars Palace replacing the Seahorse Lounge.

Over at the LINQ Promenade, in addition to opening the Amorino Gelato and Gordon Ramsay's Fish & Chips, construction begins on several new tenants that will soon arrive to the complex, including In-N-Out Burger and Virgil’s Real Barbecue, which are on track to open by year-end.

Once these leased sites are opened, occupancy at the complex will increase to 91%. The High Roller has demonstrated improved performance as well with ridership up 18% in the third quarter due to enhanced marketing efforts by our dedicated team, focused on attracting traffic to the LINQ Promenade.

On a regional basis, we are adding new offerings as well. We recently opened the Cross Street Grill at Harrah's Joliet and have plans to open Guy Fieri's Philly Kitchen & Bar at Harrah's Philadelphia, and The Blind Tiger at Harrah's Biloxi.

On the entertainment front, our headliner business has proved to be successful in the expansion of our offerings to make Caesars the third largest live entertainment promoter in North America.

The AXIS at Planet Hollywood and the Colosseum at Caesars Palace have been important drivers behind this achievement and have enabled us to deliver strong growth in entertainment revenues.

Pollstar ranked The AXIS as the number one theater venue in United States based on 2016 year-to-date ticket sales through the third quarter and the Colosseum was ranked third on the same metric.

The AXIS has held in a new era of entertainment in Las Vegas by bringing the first pop music residencies to the Strip, including Britney Spears and Jennifer Lopez.

In March 2017, the best-selling boy band of all time, The Backstreet Boys, will be the latest artist to headline an exclusive residency of 26 shows at The AXIS and sales are already off to an extraordinary start. We are working to upgrade our entertainment amenities outside the Las Vegas as well.

Last month, we announced several enhancements to Harrah's Philadelphia, including improvements to our existing gaming and entertainment area located at The Block. The space will offer customers a uniquely intimate concert experience as well as live table game action and a brand-new bar and lounge.

We expect these renovations to be completed by the spring of next year. We also plan to add an exciting new entertainment venue at Harrah's New Orleans that I look forward to providing more details on in the future. I'd like now to turn the call and talk a little bit about our continuous improvement efforts on Slide 12.

Our investments in technology are critical. They allow us to improve productivity and quality and better connect with our customers by delivering scalable personalized service.

On the customer service side, we have expanded the rollout of self-service check-in kiosks to six hotels in Las Vegas and approximately 22% of our guests at those properties are now using this feature. Subject to any regulatory approvals, we are also migrating certain applications and data to the cloud to increase efficiency and agility.

We continue to look for ways to optimize our marketing programs to increase visitation and productivity through all of our key customer contact channels. We plan to leverage technology to better meet the needs of our guests and improve the overall customer experience.

We're also leveraging technology to enhance the sales and service culture within the organization, as shown on Slide 13. For example, the implementation of mobile technology on the slot board to manage customer transactions and streamline processes has resulted in better service for our gaming guests.

Our slot attendant activity scheduling is prioritized automatically and communicated to them via a mobile device. The Mobile Slot Dispatch System, which has been deployed at 11 properties in Las Vegas and regional markets, has delivered a 15% to 20% improvement in response efficiency.

We expect to introduce this technology to all properties by the second quarter of 2017. Our continued progress on our sales and service cornerstone is reflected in the fact that overall service scores improved year-over-year in the third quarter. Turning to Slide 14, gaming innovation is a long-term strategic focus.

In September, we entered into two new agreements with Gamblit and GameCo which will make Caesars the first casino operator to offer skills-based real money gaming machines unlike anything seen on the casino floors today.

Through our multiyear agreement with Gamblit, Caesars will roll out Gamblit's Model G and TriStation machines in our California and Nevada properties, beginning with Harrah's resorts in Southern California. Each machine contains multiple themes and cutting-edge skills-based games, including a Match 3 game and a word matching game.

We plan to field trial games at our Nevada properties pending regulatory approval, after which we expect to deploy a large number of gaining seats across multiple properties in the state. We also reached an agreement with GameCo to debut their video game gambling machines at our Atlantic City properties.

Following the receipt of a regulatory approval in October, Harrah's, Bally's and Caesars now feature a total of 21 gaming positions at GameCo's new offering Danger Arena. This first-person action game where players' skill determines the payout combines the fun and entertainment of video games, e-sports and gambling, all in one experience.

We are proud to be the first to bring these innovative games to our customers and plan to make skill-based games an increasingly important part of our gaming environments. I will now ask Eric to provide a more detailed view of this quarter's results..

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 will include CEOC's performance as well. Slide 16 summarizes CEC's results, which do not include CEOC as it is no longer consolidated.

Additionally, the sale of CIE's social and mobile games business in the third quarter has caused that business to be classified as a discontinued operation. CIE's remaining business, which includes real money online gaming and the World Series of Poker, will be accounted for going forward in CEC and CGP's results.

For the third quarter of 2016, CEC's net revenues increased 3% to $986 million, mainly due to strong growth in the Las Vegas region, which was partially offset by revenue declines in Atlantic City and New Orleans and unfavorable year-over-year hold.

Net income, before including the effect of non-controlling interest, was $5 million in the quarter compared to a net loss of $756 million in the third quarter of 2015. Earnings per share for CEC, which includes the effect of non-controlling interest, was a loss of $4.38 per share compared to a net loss of $5.44 per share in the year ago period.

The non-controlling interest is primarily Caesars Acquisition Company's ownership in CGP. Year-over-year, net income and earnings per share improvements were driven by a $4.2 billion pre-tax gain on the sale of CIE's social and mobile games unit, partially offset by an accrual increase of approximately $3 billion related to the restructuring of CEOC.

Due to these large charges, we believe it's beneficial to provide adjusted EBITDA figures as further insight into our operational performance. Adjusted EBITDA increased 9% to $269 million, with a margin increase of 158 basis points, mainly due to higher revenues and efficiency initiatives.

Hold was estimated to have a positive effect on operating income of between $5 million and $10 million in the quarter relative to our expected hold, and an unfavorable effect of between $5 million and $10 million when compared to the prior year period.

Turning to Slide 17 and the performance of Caesars Entertainment Resort Properties, third quarter net revenues rose 5% year-over-year to $569 million due to strong growth in gaming and hospitality revenues in Nevada.

While CERP experienced strength in Las Vegas due to higher hotel rates, there were over 32,000 room nights out of service during the quarter due to room renovations that had a negative effect. These room nights were primarily concentrated at the Paris Resort and Casino which began renovations in July and will continue through the remainder of 2016.

Service net income increased $6 million year-over-year to $6 million and the net profit margin was 1.1%. Adjusted EBITDA increased 8% year-over-year to $170 million, with adjusted EBITDA margins up 91 basis points, mainly due to higher revenues and marketing and operational efficiencies.

Hold was estimated to have a positive effect on operating income of between $5 million and $10 million in the quarter relative to our expected hold, and between $0 and $5 million when compared to the prior year period. Slide 18 summarizes the performance of Caesars Growth Partners.

Caesars Growth Partners net revenues were $422 million in the third quarter, up 1% year-over-year, mainly due to higher hotel rates and increases in entertainment revenues in Las Vegas. That was offset by an unfavorable year-over-year hold and lower food and beverage revenues due to decreases in the banquet business in Las Vegas.

At Harrah's New Orleans, we look forward to opening our first outdoor smoking patio on December 1. We believe the patio will provide a more convenient alternative for our smoking guests and help alleviate the loss of slot revenues that we have experienced since the smoking ban went into effect.

Net income before including the effect of non-controlling interest increased to $3.9 billion from $21 million in the year ago period, mainly due to the gain on sale of CIE's social and mobile games business.

Adjusted EBITDA increased 2% year-over-year to $100 million, and adjusted EBITDA margin grew 25 basis points due to higher revenues and efficiency initiatives.

Hold was estimated to have a minimal effect on operating income in the quarter relative to our expected hold and an unfavorable $5 million to $10 million effect when comparing to the prior year period. Unfavorable hold was concentrated at Harrah's New Orleans due to exceptional hold in the same period last year.

Slide 19 shows supplemental information on CEOC's third quarter performance. Net revenues were $1.2 billion, down 5% year-over-year as a result of unfavorable year-over-year hold, mainly at Caesars Palace, and lower gaming volumes in our Southeast region, partially offset by our higher hotel rates and improved food and beverage revenues in Nevada.

Additionally, reimbursable revenues declined due to the removal of the Ohio properties and the expenses associated with these revenues declined similarly. Adjusted EBITDA decreased 12% to $276 million, and margins declined 190 basis points from the prior year period, mainly due to hold.

Hold was estimated to have an unfavorable effect on the operating income of between $10 million and $15 million in the quarter relative to our expected hold, and between $25 million and $30 million when compared to the prior year period.

Now let's take a look at additional non-GAAP supplemental information for the entire Enterprise for the third quarter on Slide 20, which include CEOC and the recently sold social and mobile games business.

Caesars Enterprise-wide net revenues were down 1% to $2.1 billion, as higher revenues in Las Vegas were offset by revenue declines in our regional markets, unfavorable year-over-year hold and lower reimbursable expenses. Excluding reimbursable expenses, revenues would have been flat on a year-over-year basis.

Caesars Enterprise-wide adjusted EBITDA increased 1% year-over-year to $638 million due to the performance of CIE's social and mobile gaming business and marketing and operational efficiencies which offset lower revenues.

Hold was estimated to have an unfavorable effect on operating income of between $5 million and $10 million in the quarter relative to our expected hold, and between $30 million and $35 million when compared to the prior year period.

Going forward, we expect the inflationary cost pressures, including salary and benefits, to persist into the fourth quarter and we remain diligent in managing these pressures through our continuous improvement initiatives.

We also expect to be adversely affected by ongoing restructuring efforts, largely in the form of elevated expenses across many parts of our business.

Lastly, ongoing room renovations across our hotel portfolio will result in inventory disruptions, particularly in the fourth quarter and into 2017, given the ramp-up of construction activities at Paris and the beginning of construction at Planet Hollywood and Harrah's Atlantic City, all of which we will attempt to mitigate.

Slide 21 provides a summary of quarter-end liquidity and projected capital expenditures for the CEC consolidated entities. The underlying performance of the Enterprise continues to strengthen, driven by our investments in the high-return low-risk areas such as room renovations and our more efficient operating model.

This has resulted in greater cash flow generation than we had originally anticipated. We will continue to look for opportunities to optimize our cash flow through efficiencies and profitable growth investments to drive value for our stakeholders. I'll turn it back to Mark for some closing comments..

Thank you, Eric. Please turn to Slide 23. In summary, Caesars delivered solid operating performance in the third quarter despite contending with significant unfavorable hold, inflationary pressures and gaming weakness in the Southeastern U.S.

As we look to 2017, we are focused on executing against our cornerstone initiatives, prudently allocating our capital to high-return projects and laying the groundwork to continue our solid performance. Hospitality will remain a critical driver of revenue growth as additional renovated hotel inventory comes online.

We're also optimistic of the introduction of new and exciting skills-based gaming products will appeal to new customers. Further, we are pleased about the progress that has been made in the CEOC restructuring. We are hopeful that this puts CEOC on a path to emerge from bankruptcy next year.

We're looking forward to directing management's full attention towards executing our strategic priorities and creating value for our stakeholders. We will now open up the line for Q&A. We'd ask that you please keep your questions focused on business performance.

Operator?.

[Operator Instructions] Your first question comes from the line of Susan Berliner with J.P. Morgan..

So you guys talked a lot about skill-based, and I was wondering, I know it's early, if you could give any color with regards to how those machines are doing versus what's on the existing floor, what kind of demographics of people have been seeking those out?.

Unfortunately, you're right. We just put them on the floor I believe last week. So we don't have data to share at this point. So I think we'll have to wait until the next conference call.

We're obviously very excited to trial the games in Atlantic City and get the responses from the customers, but at this point unfortunately it's just too early to give any feedback..

Great.

And is it too early also to discuss any change that you have seen with the new Borgata management, any increased promotions in AC markets?.

Yes, a similar answer. We haven't heard of any significant changes at this point. But as you know, it has been fairly recent when they changed ownership structure..

Great.

And then just turning to the consumer, I was wondering if you could talk about trends you saw during the quarter and if you can give us any color on October with regards to spend, visitation or different buckets of customers?.

From a database perspective, really the trends have been quite consistent for the last multiple quarters. We continue to see some slight increases in trips from our higher-end customers and our spend-per-trip across most categories continues to increase.

Where we're seeing declines, it does tend to be in the lower-end segment, and that's on a trip basis, not necessarily on a spend-per-trip basis. So that's from the gaming side, which is largely consistent to what we've seen before.

From the non-gaming side, which is particularly dominant here in Las Vegas, we continue to see relatively strong demand from the FIT, and overall, although it's somewhat lumpy, from the group customer the demand also continues to be reasonably strong..

Great.

My last question is, Eric, if you could give us CapEx by each entity for the quarter?.

Sure. I'll just run through it and it's detailed in the Q that will be coming out shortly as well. For CERP, we spent $28 million, which makes our year-to-date $87 million. For CGP, it was $17 million and year-to-date would be $57 million. CES was $8 million in the quarter, which is $14 million year-to-date.

And then at CEOC, it was $37 million, and that makes the total year-to-date $171 million. So the total for the quarter was $90 million and the total year-to-date was $329 million. As you saw in the materials, we did update our ranges slightly.

The aggregate change for all the subsidiaries on a consolidated basis was to reduce the low end by $20 million and then the high end by $10 million. Again, I would think of that as basically timing. Some of our construction spending got pushed into 2017 that we had anticipated we would achieve in the late 2016 timeframe..

Great. Thanks very much..

Your next question comes from the line of David Farber with Credit Suisse..

I had a couple of questions. I wanted to first lead with Las Vegas. Obviously we see continued strength in the hotel and F&B side.

I was curious how you feel you are positioned for 2017, any expectations you may have for Vegas in 2017? And then separately, maybe talk a little bit about how many rooms you think will be offline given all the developments you're doing on the Strip? And then I had a couple of follow-ups. Thanks..

Sure. I'll try to answer it first. From a positioning standpoint, one of the objectives that we've had and what's part of our cornerstone initiatives is to really improve the asset quality of our hotel rooms and the underlying product that we are able to offer to the customers.

As you have been following since late 2014, we have undertaken an initiative to try to renovate the majority of our Las Vegas rooms and we're making significant progress along those lines.

What ultimately happens is that then the customers perceive our product as better, we are able to then get more efficient bookings that cost us less, we also get up-sells as we've mentioned from a revenue standpoint, and customers that stay in upgraded rooms also tend to spend more on the other activities. So it's a very virtuous position to be in.

As we mentioned, we'll have about 10,000 of the rooms or 44% completed by the midpoint of next year. And so, that will significantly improve our position with respect to the market. And that's really from a Las Vegas standpoint where we think the biggest upside is from that non-gaming side.

Regarding the room construction disruption, we mentioned this quarter we had about 32,000 rooms out of order. We'd anticipate throughout next year, although again it could be somewhat lumpy, but we would anticipate to have outages of that similar magnitude.

Certainly in the fourth quarter we have a number of towers under renovation, including significant construction at Paris and Planet Hollywood. And then heading into next year, we also take out the Palace Tower here at Caesars Palace, which is slightly over 1,100 rooms. So that's a significant renovation.

Those will all finish up next year, but there is going to be similar construction disruption as we head into next year..

That's helpful.

And then on the mix side, any sort of expectations around Vegas in terms of either bookings, group bookings, RevPAR, any sort of thoughts around what you think 2017 may look like given what's on the calendar today?.

Again, it's similar to how I answered Su's comment on the database makeup. The trends have been largely consistent. The FIT business has been relatively strong throughout the year. We don't see any reason why that would change.

The group business, although it can be lumpy at times, has also been reasonably strong and we would expect 2017 to be a continuation of what we've achieved this year.

So, from a mix standpoint, I wouldn't anticipate anything dramatically changing, just an improvement in our offerings which will enable us to be able to attract customers and charge higher rates on the ADR front..

Okay. And then just switching over to CEOC for the moment, the results were a touch weaker this quarter, although I guess the hold adjustment gets you guys effectively flattish it seems.

So, I guess away from Vegas, I was curious to hear how you're thinking about the regional markets, what customer behavior may be like? Any thoughts there would be helpful, and then I had one last question. Thanks..

You're right, we had very unusual poor hold concentrated within CEOC, and you're right that adjusting for that makes it much more of a respectable performance for the quarter. The impact from the regional markets is really being hit down in the Louisiana-Mississippi region. There is definite weakness in the consumer.

We believe it's centered around the oil and gas industry and it's kind of across the board in terms of our properties. We're taking actions to try to minimize that as I mentioned with some things we're doing in New Orleans, and Mark mentioned the potential entertainment activities that we're able to do down there.

So, we are trying to offset it but there is weakness in that Louisiana-Mississippi region. Broadly speaking, the rest of the regional markets are similar to what we have seen throughout 2016, with some markets up a few percent, some markets down a few percent, but really I wouldn't call out any other abnormal trends..

Okay. And then just finally, there are a number of sort of new market growth opportunities, potentially in the near to mediate term.

I guess I was just curious how you think Caesars is positioned either internationally or domestically, maybe a new topic with the exit, but I'd be curious to hear how you think about those growth opportunities and what, if any, particular market you might be focusing on? And that's it for me. Thanks..

I think that as you look at the opportunity going forward, what we've modelled anyway, is based on the agreements actually getting approved by the Bankruptcy Court, which would be in January. We'll have a very strong balance sheet, one of the strongest balance sheets of all public companies.

Leverage will be a little bit lower than what most of the public companies are at right now, probably a turn lower on debt-to-EBITDA. And so, we'll take advantage of that. We'll have an opportunity to look at certain markets that I would call destination markets where we know that if we invest some capital, we get a reasonable return on it.

So, if it's for example a hotel product, there's an opportunity to get cash business on it. And then if we're like number three or number four in the market, we think there may be an opportunity to get synergies by buying smaller players not doing well, someone who we could for example bring Total Rewards in and get a lift.

And we're seeing obviously anywhere we go with Total Rewards, we bring in a usual lift in the property. So, we think there will be development opportunities once we get out of bankruptcy.

We haven't been able to pursue those obviously for the last couple of years, but given our regional presence, we think there is opportunity in some of those regional markets from a – what you would call destination markets.

So, that could be New Orleans, Lake Tahoe, Atlantic City to a lesser extent, but there are markets that we think we could develop even better. We also know that globally there is a lot of development projects that we certainly have our row in the water but nothing has come to fruition. But you certainly heard MGM talk about those today.

We are certainly – we are in the mix on all those and we'll make sure that we pursue those and there will be lots of growth opportunities globally going forward the next couple of years.

The last thing I'll just mention is that we also – when we look at the room product in Vegas, we think that can provide really good earnings momentum as we come out of bankruptcy because we were a little undercapitalized and we hadn't kept current with our room product, and everyone else on the Strip had. That allows really nice flow-through.

When we do a room refurb, we get typically a 30% to 35% ROIC on that, and that's very high and it's very low-risk project and it provides really good flow-through on the $25 to $40 a room night that we get. The cost is there already, it's a fixed cost to service the room, and we just get very high flow-through from it.

So, we think that will provide really good earnings momentum going forward with the company..

Very good. Thanks..

Your next question comes from John DeCree with Union Gaming..

Mark, just wanted to stay on the topic that you just brought up there, I was wondering if on the room renovations, the cash ADR premium you see, if it's relatively instant in terms of price directing on your side or if there's a little bit of a ramp once some of your customers get a chance to see the new rooms, and just curious if there's a little bit of a ramp-up period once those rooms come online?.

Not really. I'll let Eric respond on this too, but I mean in general it's fairly quick. I would say, within 90 days or less we were seeing an instant lift. We typically do some pre-promotion on it. So it's not like we introduce the room product in the market and then just expect everyone to know about it.

I mean we do launch some PR, some online, some social media to make sure people understand the rooms are new and they can be booking them. And we open up big quadrums of them, if you will. It's not just, like if we get one onboard, we'll go ahead and announce one, we'll announce a whole tower.

For example, Caesars Palace, and we did that for example on Augustus, and we were talking about it and we did – we just announced recently the opening of Julius, and we got very quick lift on it. So, again, we've done 10,000 rooms of the 24,000 rooms we have on the Strip. We expect to complete the rest of them over the next couple of years.

And we've had obviously interruption in our numbers this year and we'll have that next year, but we're still overcoming that being able to get a nice profit improvement from it..

Got it. Thank you.

And one question, sorry if I missed it, Eric, in your prepared remarks, I think you mentioned some inflationary cost pressures, wasn't sure if that was just general inflation or elevated costs from some of the reinvestment projects that you guys are doing, if you could just give me a little bit of color on that?.

Sure. I did mention it in the specific remarks, but it's general inflation. However, it's somewhat exacerbated by some particular increases that we've had in the salaries, wages and benefits area associated with large portions of our workforce. And then the rest of the increases would be general inflation associated with just normal commodities..

Got it. Thanks a lot..

At this time, there are no further questions..

Thank you, operator. And that concludes our third quarter call and we look forward to reporting fourth quarter and full-year results after the beginning of next year. Thanks very much..

Thank you for joining us. This does conclude our call. You may now disconnect. Have a great day..