XML 36 R24.htm IDEA: XBRL DOCUMENT v3.20.2
Segment Information
9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Information Segment Information
We have aggregated our operating segments into four reportable segments based on the similar characteristics of the operating segments within the regions in which they operate: Northeast, South, West and Midwest. The Other category is included in the following tables in order to reconcile the segment information to the consolidated information.
The Company utilizes Adjusted EBITDAR (as defined below) as its measure of segment profit or loss. The following table highlights our revenues and Adjusted EBITDAR for each reportable segment and reconciles Adjusted EBITDAR on a consolidated basis to net income (loss).
 For the three months ended September 30,For the nine months ended September 30,
(in millions)2020201920202019
Revenues:  
Northeast segment$545.1 $628.9 $1,168.5 $1,778.6 
South segment255.6 276.6 600.4 850.7 
West segment78.7 161.5 223.0 484.4 
Midwest segment229.1 275.8 493.2 815.3 
Other (1)
23.7 12.4 71.6 31.9 
Intersegment eliminations (2)
(2.5)(0.7)(5.4)(0.7)
Total$1,129.7 $1,354.5 $2,551.3 $3,960.2 
Adjusted EBITDAR (3):
Northeast segment$204.8 $189.1 $325.7 $540.1 
South segment120.3 89.0 217.3 279.6 
West segment33.6 50.6 55.2 151.0 
Midwest segment 108.5 104.3 173.4 301.3 
Other (1)
(14.6)(25.0)(42.2)(66.1)
Intersegment eliminations (2)
— (0.1)— (0.1)
Total (3)
452.6 407.9 729.4 1,205.8 
Other operating benefits (costs) and other income (expenses):
Rent expense associated with triple net operating leases (4)
(109.0)(96.3)(310.3)(271.0)
Stock-based compensation(2.8)(3.7)(11.7)(10.4)
Cash-settled stock-based awards variance(39.5)3.4 (46.7)6.4 
Gain (loss) on disposal of assets6.0 (7.4)33.9 (8.3)
Contingent purchase price— (1.2)1.4 (7.0)
Pre-opening and acquisition costs(4.8)(7.4)(11.5)(15.5)
Depreciation and amortization(87.7)(106.3)(275.3)(316.4)
Impairment losses— — (616.1)— 
Insurance recoveries, net of deductible charges— 1.5 0.1 1.5 
Non-operating items of equity method investments (5)
(1.2)(0.9)(3.2)(2.8)
Interest expense, net(142.3)(133.5)(407.1)(400.5)
Other (6)
55.6 7.2 63.1 7.2 
Income (loss) before income taxes126.9 63.3 (854.0)189.0 
Income tax benefit (expense)14.3 (19.6)172.2 (53.0)
Net income (loss)$141.2 $43.7 $(681.8)$136.0 
(1)The Other category consists of the Company’s stand-alone racing operations, namely Sanford-Orlando Kennel Club and the Company’s JV interests in Sam Houston Race Park, Valley Race Park, and Freehold Raceway. The Other category also includes Penn Interactive, which operates social gaming, our internally-branded retail sportsbooks, iGaming and our Barstool Sports online sports betting app; our management contract for Retama Park Racetrack; and HPT. Expenses incurred for corporate and shared services activities that are directly attributable to a property or are otherwise
incurred to support a property are allocated to each property. The Other category also includes corporate overhead costs, which consist of certain expenses, such as: payroll, professional fees, travel expenses and other general and administrative expenses that do not directly relate to or have not otherwise been allocated to a property. In addition, the Other category includes our proportionate share of the Adjusted EBITDAR of Barstool Sports (as determined and discussed in footnotes (3) and (5) below).
(2)Represents the elimination of intersegment revenues associated with Penn Interactive and HPT.
(3)We define Adjusted EBITDAR as earnings before interest expense, net; income taxes; depreciation and amortization; rent expense associated with triple net operating leases (see footnote (4) below); stock-based compensation; debt extinguishment and financing charges; impairment losses; insurance recoveries and deductible charges; changes in the estimated fair value of our contingent purchase price obligations; gain or loss on disposal of assets; the difference between budget and actual expense for cash-settled stock-based awards; pre-opening and acquisition costs; and other income or expenses. Adjusted EBITDAR is also inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (see footnote (5) below) added back for Barstool Sports and our Kansas Entertainment JV.
(4)The Company’s triple net operating leases include certain components of the Master Leases (primarily land), the Meadows Lease, the Margaritaville Lease, the Greektown Lease, and the Tropicana Lease.
(5)Consists principally of interest expense, net; income taxes; depreciation and amortization; and stock-based compensation expense associated with Barstool Sports and our Kansas Entertainment JV.
(6)Principally includes holding gains on our equity securities, which are discussed in Note 17, “Fair Value Measurements.” Additionally, includes non-recurring restructuring charges (primarily severance) of $12.4 million associated with a company-wide initiative, triggered by the COVID-19 pandemic, designed to (i) improve the operational effectiveness across our property portfolio; and (ii) improve the effectiveness and efficiency of our Corporate functional support areas.
 For the three months ended September 30,For the nine months ended September 30,
(in millions)2020201920202019
Capital expenditures:  
Northeast segment$10.3 $22.8 $62.3 $67.3 
South segment3.1 5.0 10.9 21.5 
West segment1.4 3.7 5.5 17.8 
Midwest segment4.8 6.2 9.7 22.6 
Other4.3 4.0 9.2 7.5 
Total capital expenditures$23.9 $41.7 $97.6 $136.7 

(in millions)NortheastSouthWestMidwest
Other (1)
Total
As of September 30, 2020
Investment in and advances to unconsolidated affiliates (2)
$0.1 $— $— $84.8 $178.1 $263.0 
Total assets$1,938.2 $1,169.0 $385.9 $1,170.0 $10,148.9 $14,812.0 
As of December 31, 2019
Investment in and advances to unconsolidated affiliates$0.1 $— $— $90.9 $37.3 $128.3 
Total assets$2,273.7 $1,397.0 $752.1 $1,412.2 $8,359.5 $14,194.5 
(1)The real estate assets subject to the Master Leases, which are classified as either property and equipment, operating lease ROU assets, or finance lease ROU assets, are included within the Other category.
(2)Our investment in Barstool Sports is included within the Other category.