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US – Caesars’ President Mark Frissora to leave the company

By - 2 November 2018

Caesars Entertainment’s President and Chief Executive Officer Mark Frissora is leaving the company, having led a successful operational and financial transformation and established a platform for future growth.

To support a seamless transition, Mr. Frissora will remain in his current role until February 8, 2019.

The four members of the Compensation and Management Development Committee as well as the Chairman of the Board will work with a nationally recognised search firm to identify Mr. Frissora’s successor.

“The Board of Directors thanks Mark for his instrumental role in leading the Company through a challenging period and setting Caesars on a course for sustained, long-term growth and value creation,” said Jim Hunt, Chairman of the Board of Directors. “Under Mark’s leadership, the Company has significantly improved margins and profitability while simultaneously increasing customer and employee satisfaction. We are grateful for his leadership and numerous contributions and are optimistic for the future.”

Mr. Frissora said: “I have been privileged to lead this iconic Company and am proud of all that our team has accomplished. Together, we navigated a complex restructuring process. We have improved our margins significantly and created enterprise value which enabled the successful reorganization of our Caesars Entertainment Operating Company subsidiary. I am confident that the Company is well positioned to thrive and grow in the future. I am committed to maintaining stability and operating discipline during this transition.”

Under Mr. Frissora’s leadership, Caesars implemented strategies resulting in a 900 basis points increase in adjusted EBITDAR margin and a nearly $800 million increase in adjusted EBITDAR. The Company has completed the renovation of approximately 70% of the hotel rooms across its network and launched various organic and inorganic growth initiatives, including the acquisition of Centaur Holdings, LLC, expansion into Dubai, the planned development of Caesars’ first resort in Mexico and the pursuit of a license in Japan.

During Mr. Frissora’s tenure, the Company has also significantly deleveraged its balance sheet and simplified its capital structure. Since 2014, prior to the restructuring of Caesars Entertainment Operating Company, Caesars has reduced the cost of its debt by 400 basis points and is committed to further deleveraging. In the same period, the Company reduced annual fixed charges, including interest expense, by $1.4bn.

News of his departure came out following release of the company’s Q3 earnings when enterprise-wide net revenues increased 2.9 per cent, or $62m, from $2.12bn to $2.19bn.

Mr. Frissora commented: “Third quarter net income was $110m compared to a loss of $433m in the prior year period, benefiting from the consolidation of CEOC and acquisition of Centaur. Despite soft demand in Las Vegas during the six per cent adjusted EBITDAR growth for the full year. Our results demonstrated continued broad-based strength across our regional properties and momentum in our operational efficiency efforts. Our performance this quarter shows the benefits of our portfolio approach and the balance between destination and regional assets.”

Mr. Frissora continued: “We are making important progress against our growth strategy with the integration of Centaur, expansion of our US sports betting business and the creation or renewal of partnerships with six professional sports organisations. We have the right strategies in place and are confident in our ability to create value for shareholders over the long-term, as evidenced by our repurchase of $311m in shares year to date.”

Caesars also outlined that Golden Nugget Casinos owner Tilman Fertitta had wanted to merge with the company but Caesars said it was ‘not consistent with the company’s plans to create and enhance shareholder value over the long term.’

Shares in Caesars increased nine per cent following news of his departure but remain down 30 percent this year.

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