Caesars Entertainment (CZR) 8-K Caesars Entertainment, Inc. Reports Second Quarter 2020 Results

Exhibit 99.1

Caesars Entertainment, Inc. Reports Second Quarter 2020 Results

Reno and Las Vegas, Nev. (August 6, 2020) – Caesars Entertainment, Inc., (NASDAQ: CZR) (“Caesars,” “CZR,” or “the Company”), formerly known as Eldorado Resorts, Inc., today reported operating results for the second quarter ended June 30, 2020.

Second Quarter 2020 and Recent Highlights:

• Net revenue for legacy Eldorado Resorts properties of $126.5 million, a decrease of 80.1% on a GAAP basis and 78.2% on a same-store basis versus the comparable prior-year period

• Net loss of $100.0 million compared to net income of $18.9 million for the comparable prior-year period

• Same-store Adjusted EBITDA for legacy Eldorado Resorts of negative $10.4 million versus positive $164.8 million for the comparable prior-year period

• Eldorado Resorts and Caesars Entertainment Corporation completed their merger on July 20, 2020 creating the largest casino and entertainment company in the U.S.

• New Caesars Entertainment Inc. pro forma liquidity positions the company well to weather any short term disruptions due to COVID-19

• 51 properties of new Caesars Entertainment, Inc. in the U.S. have resumed operations since mid-May 2020

Tom Reeg, Chief Executive Officer of Caesars Entertainment, Inc., commented, “Our second quarter operating trends were negatively impacted as the majority of our properties remained closed during April and May 2020. Our properties began to reopen in late May and early June. All of the combined new Caesars Entertainment, Inc. regional properties are now reopened and we are encouraged by operating trends.”

Reeg continued, “Now that the merger has closed, our operating teams are fully engaged with integrating the two companies and executing on the synergy plans. Our number one priority remains the safety and security of our Team Members and Guests. Our COVID-19 operating plans for reopened properties are designed to ensure a safe and exciting environment for our Guests. We remain optimistic regarding an eventual recovery of travel and tourism in the U.S. and especially Las Vegas.”

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($ in thousands)	Total Net Revenue
	Three Months Ended
	June 30,
	2020		2019		2019 Divestitures(1)		2019 Total(2)		Change
West	$	29,937	$	127,727	$	—	$	127,727		-76.6	%
Midwest		22,787		97,239		22,991		74,248		-69.3	%
South		30,760		116,937		—		116,937		-73.7	%
East		21,226		170,455		32,707		137,748		-84.6	%
Central		19,848		122,792		—		122,792		-83.8	%
Corporate and Other		1,912		1,971		—		1,971		-3.0	%
Total Net Revenue	$	126,470	$	637,121	$	55,698	$	581,423		-78.2	%

($ in thousands)	Net (Loss) Income
	Three Months Ended
	June 30,
	2020			2019			2019 Divestitures(1)		2019 Total(2)			Change
West	$	(12,711	)	$	11,348		$	—	$	11,348			-212.0	%
Midwest		1,378			21,435			4,737		16,698			-91.8	%
South		(10,912	)		12,747			—		12,747			-185.6	%
East		(30,456	)		15,981			3,107		12,874			-336.6	%
Central		(20,452	)		13,070			—		13,070			-256.5	%
Corporate and Other		(26,843	)		(55,645	)		—		(55,645	)		-51.8	%
Total Net (Loss) Income	$	(99,996	)	$	18,936		$	7,844	$	11,092			-1,001.5	%

($ in thousands, except per share data)	Adjusted EBITDA
	Three Months Ended
	June 30,
	2020			2019			2019 Divestitures(1)		2019 Total(2)			Change
West	$	734		$	34,305		$	—	$	34,305			-97.9	%
Midwest		4,648			36,753			7,932		28,821			-83.9	%
South		(2,476	)		29,109			—		29,109			-108.5	%
East		(9,948	)		47,418			5,904		41,514			-124.0	%
Central		3,593			39,602			—		39,602			-90.9	%
Corporate and Other		(6,934	)		(8,526	)		—		(8,526	)		-18.7	%
Total Adjusted EBITDA(3)	$	(10,383	)	$	178,661		$	13,836	$	164,825			-106.3	%
Net (Loss) Income	$	(99,996	)	$	18,936
Basic EPS	$	(1.25	)	$	0.24
Diluted EPS	$	(1.25	)	$	0.24

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($ in thousands)	Total Net Revenue
	Six Months Ended
	June 30,
	2020		2019		2019 Divestitures(1)		2019 Total(2)		Change
West	$	135,427	$	245,822	$	—	$	245,822		-44.9	%
Midwest		83,580		194,026		47,319		146,707		-43.0	%
South		127,812		249,651		—		249,651		-48.8	%
East		129,282		336,688		70,944		265,744		-51.4	%
Central		119,553		243,264		—		243,264		-50.9	%
Corporate and Other		3,885		3,493		—		3,493		11.2	%
Total Net Revenue	$	599,539	$	1,272,944	$	118,263	$	1,154,681		-48.1	%

($ in thousands)	Net (Loss) Income
	Six Months Ended
	June 30,
	2020			2019			2019 Divestitures(1)		2019 Total(2)			Change
West	$	(104,011	)	$	15,665		$	—	$	15,665			-764.0	%
Midwest		(15,239	)		43,590			9,887		33,703			-145.2	%
South		(24,910	)		32,956			—		32,956			-175.6	%
East		(32,647	)		27,149			5,229		21,920			-248.9	%
Central		(15,728	)		25,948			—		25,948			-160.6	%
Corporate and Other		(83,099	)		(88,143	)		—		(88,143	)		-5.7	%
Total Net (Loss) Income	$	(275,634	)	$	57,165		$	15,116	$	42,049			-755.5	%

($ in thousands, except per share data)	Adjusted EBITDA
	Six Months Ended
	June 30,
	2020			2019			2019 Divestitures(1)		2019 Total(2)			Change
West	$	20,359		$	58,348		$	—	$	58,348			-65.1	%
Midwest		26,435			73,077			16,654		56,423			-53.1	%
South		15,228			67,780			—		67,780			-77.5	%
East		12,337			86,922			10,737		76,185			-83.8	%
Central		33,490			77,925			—		77,925			-57.0	%
Corporate and Other		(15,685	)		(18,739	)		—		(18,739	)		-16.3	%
Total Adjusted EBITDA(3)	$	92,164		$	345,313		$	27,391	$	317,922			-71.0	%
Net (Loss) Income	$	(275,634	)	$	57,165
Basic EPS	$	(3.49	)	$	0.74
Diluted EPS	$	(3.49	)	$	0.73

(1) Figures are for Presque for the period beginning January 1, 2019 and ending January 11, 2019, Nemacolin for the period beginning January 1, 2019 and ending March 8, 2019, and Mountaineer, Cape Girardeau and Caruthersville for the three and six months ended June 30, 2019.

(2) Total figures for the three and six months ended June 30, 2019 exclude the results of operations for Presque for the period beginning January 1, 2019 and ending January 11, 2019, Nemacolin for the period beginning January 1, 2019 and ending March 8, 2019 and Mountaineer, Cape Girardeau and Caruthersville for the three and six months ended June 30, 2019. Such presentation does not conform to GAAP or the Securities and Exchange Commission rules for pro forma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company.

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(3) Adjusted EBITDA is not a GAAP measurement and is presented solely as a supplemental disclosure because the Company believes it is a widely used measure of operating performance in the gaming industry. See “Reconciliation of GAAP Measures to Non-GAAP Measures” below for a definition of Adjusted EBITDA and a quantitative reconciliation of Adjusted EBITDA to net (loss) income, which the Company believes is the most comparable financial measure calculated in accordance with GAAP.

Balance Sheet and Liquidity

As of June 30, 2020, legacy Eldorado Resorts had $2.7 billion of debt outstanding. Total cash and cash equivalents were $950.5 million, excluding restricted cash.

“We have a strong liquidity position which will allow us to weather short term weakness due to COVID-19. For new Caesars Entertainment, Inc. we successfully executed an $8 billion debt raise on June 19, 2020 which further enhances our pro forma liquidity,” said Bret Yunker, Chief Financial Officer.

Combined Eldorado and Caesars Results    

The company has posted certain financial metrics of the combined company for the period January 1, 2019 to June 30, 2020. A presentation of these results can be located at https://investor.caesars.com.

Conference Call Information

The company will host a conference call to discuss the company’s results on Thursday, August 6, 2020 at 2 p.m. Pacific Time. Participants should dial 877-637-3676, or 832-412-1752 for international callers, and enter Conference ID 3580348 approximately 10 minutes before the call start time. The call will also be accessible on the Investor Relations section of Caesars Entertainment’s website at https://investor.caesars.com.

About Caesars Entertainment, Inc.

Caesars Entertainment, Inc. is the largest casino-entertainment company in the U.S. and one of the world’s most diversified casino-entertainment providers. Since its beginning in Reno, Nevada, in 1937, Caesars Entertainment has grown through development of new resorts, expansions and acquisitions. Caesars Entertainment’s resorts operate primarily under the Caesars^®, Harrah’s^®, Horseshoe^® and Eldorado^® brand names. Caesars Entertainment offers diversified amenities and one-of-a-kind destinations, with a focus on building loyalty and value with its guests through a unique combination of impeccable service, operational excellence and technology leadership. Caesars Entertainment is committed to its employees, suppliers, communities and the environment through its PEOPLE PLANET PLAY framework. For more information, please visit www.caesars.com/corporate.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding our strategies, objectives and plans for future development or acquisitions of properties or operations, as well as expectations, future operating results and other information that is not historical information. When used in this press release, the terms or phrases such as “anticipates,” “believes,” “projects,” “plans,” “intends,” “expects,” “might,” “may,” “estimates,” “could,” “should,” “would,” “will likely continue,” and variations of such words or similar expressions are intended to identify forward-looking statements. Although our expectations, beliefs and projections are expressed in good faith and with what we believe is a reasonable basis, there can be no assurance that these expectations, beliefs and projections will be realized. There are a number of risks

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and uncertainties that could cause our actual results to differ materially from those expressed in the forward-looking statements which are included elsewhere in this press release. These risks and uncertainties include: (a) the effects of the COVID-19 public health emergency, including (i) the impact of the actions taken to contain the public health emergency or mitigate its impact, (ii) the direct and indirect economic effects of the public health emergency and measures to contain it (including various state governments’, tribal authorities’ and/or regulatory authorities’ issuance of directives, mandates, orders or similar actions restricting freedom of movement and business operations, such as travel restrictions, border closures, business closures, limitations on public gatherings, quarantines and “shelter-at-home” orders, any of which may result in the closure of business operations) and (iii) changes and instability in global, national and regional economic activity and financial market activity as a result of the COVID-19 public health emergency and the impact on consumer discretionary spending and travel; (b) risks related to the combination of the Company and Caesars Entertainment Corporation (CEC) (the “merger”) and the integration of their respective businesses and assets; (c) potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger; (d) the possibility that the anticipated benefits of the merger, including cost savings and expected synergies, are not realized when expected or at all; (e) the impact of divestitures that are required as a condition to receipt of required regulatory approvals for the merger; (f) risks associated with increased leverage and additional rental expense resulting from debt financing and real estate transactions undertaken in connection with the merger; (g) competitive responses to the merger; (h) legislative, regulatory and economic developments; and (i) additional factors discussed in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s and CEC’s respective most recent Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. Other unknown or unpredictable factors may also cause actual results to differ materially from those projected by the forward-looking statements.

In light of these and other risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur. These forward-looking statements speak only as of the date of this press release, even if subsequently made available on our website or otherwise, and we do not intend to update publicly any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made, except as may be required by law.

Source: Caesars Entertainment, Inc.; CZR

Investor Relations: Brian Agnew, bagnew@caesars.com; Charise Crumbley, ccrumbley@caesars.com, 800-318-0047

Media Relations: Celena Haas-Stacey, chaas@caesars.com

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CAESARS ENTERTAINMENT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(dollars in thousands, except per share data)

(unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
		2020			2019			2020			2019
REVENUES:
Casino and pari-mutuel commissions	$	101,479		$	457,162		$	441,228		$	927,848
Food and beverage		6,567			75,356			62,813			150,637
Hotel		8,916			78,391			57,292			143,175
Other		9,508			26,212			38,206			51,284
Net revenues		126,470			637,121			599,539			1,272,944
EXPENSES:
Casino and pari-mutuel commissions		43,354			203,240			202,510			413,546
Food and beverage		8,250			59,497			61,505			119,882
Hotel		5,846			25,136			28,114			48,786
Other		1,179			10,723			10,360			21,972
Marketing and promotions		5,105			32,080			30,058			64,381
General and administrative		64,862			117,431			156,537			237,319
Corporate		13,050			21,051			29,532			37,805
Impairment charges		—			—			160,758			958
Depreciation and amortization		48,939			56,533			99,372			114,290
Total operating expenses		190,585			525,691			778,746			1,058,939
(Loss) gain on sale or disposal of property and equipment		(65	)		(366	)		1,393			21,952
Transaction expenses		(12,697	)		(7,292	)		(21,991	)		(9,186	)
Loss from unconsolidated affiliates		(1,450	)		(1,222	)		(1,702	)		(617	)
Operating (loss) income		(78,327	)		102,550			(201,507	)		226,154
OTHER EXPENSE:
Interest expense, net		(68,136	)		(71,798	)		(134,600	)		(145,308	)
Loss on extinguishment of debt		—			—			(158	)		—
Unrealized gain (loss) on investments and marketable securities		12,806			(1,398	)		(10,202	)		(2,858	)
Total other expense		(55,330	)		(73,196	)		(144,960	)		(148,166	)
(Loss) income before income taxes		(133,657	)		29,354			(346,467	)		77,988
Benefit (provision) for income taxes		33,661			(10,418	)		70,833			(20,823	)
Net (loss) income	$	(99,996	)	$	18,936		$	(275,634	)	$	57,165
Net (loss) income per share of common stock:
Basic	$	(1.25	)	$	0.24		$	(3.49	)	$	0.74
Diluted	$	(1.25	)	$	0.24		$	(3.49	)	$	0.73
Weighted average basic shares outstanding		80,053,676			77,682,759			79,009,373			77,625,303
Weighted average diluted shares outstanding		80,053,676			78,725,289			79,009,373			78,657,552

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CAESARS ENTERTAINMENT, INC.

SUMMARY INFORMATION AND RECONCILIATION OF

NET (LOSS) INCOME TO ADJUSTED EBITDA

($ in thousands)

	Three Months Ended June 30, 2020
	West			Midwest			South			East			Central			Corporate			Total
Net (loss) income	$	(12,711	)	$	1,378		$	(10,912	)	$	(30,456	)	$	(20,452	)	$	(26,843	)	$	(99,996	)
Interest expense, net		5,295			(32	)		4,196			12,842			13,505			32,330			68,136
Benefit for income taxes		(5,392	)		(931	)		(2,757	)		(3,617	)		(1,247	)		(19,717	)		(33,661	)
Unrealized gain on investments and marketable securities		—			—			—			—			—			(12,806	)		(12,806	)
Depreciation and amortization		13,299			4,148			6,786			11,046			11,793			1,867			48,939
Stock-based compensation		—			1			1			—			—			4,227			4,229
Transaction expenses(1)		—			—			—			—			—			12,697			12,697
Other(2)		243			84			210			237			(6	)		1,311			2,079
Adjusted EBITDA	$	734		$	4,648		$	(2,476	)	$	(9,948	)	$	3,593		$	(6,934	)	$	(10,383	)
	Three Months Ended June 30, 2019
	West			Midwest			South			East			Central			Corporate			Total
Net (loss) income	$	11,348		$	21,435		$	12,747		$	15,981		$	13,070		$	(55,645	)	$	18,936
Interest expense, net		4,982			(1	)		4,353			12,691			13,306			36,467			71,798
(Benefit) provision for income taxes		4,283			7,578			1,923			6,541			1,657			(11,564	)		10,418
Unrealized loss on investments and marketable securities		—			—			—			—			—			1,398			1,398
Depreciation and amortization		13,508			7,714			9,850			12,240			11,480			1,741			56,533
Stock-based compensation		—			10			—			—			—			6,499			6,509
Transaction expenses(1)		—			—			—			—			—			7,292			7,292
Other(3)		184			17			236			(35	)		89			5,286			5,777
Adjusted EBITDA	$	34,305		$	36,753		$	29,109		$	47,418		$	39,602		$	(8,526	)	$	178,661
Divestitures:	West			Midwest			South			East			Central			Corporate			Total
Net income	$	—		$	4,737		$	—		$	3,107		$	—		$	—		$	7,844
Provision for income taxes		—			1,241			—			1,156			—			—			2,397
Depreciation and amortization		—			1,950			—			1,643			—			—			3,593
Stock-based compensation		—			4			—			—			—			—			4
Other(3)		—			—			—			(2	)		—			—			(2	)
Adjusted EBITDA(4)	$	—		$	7,932		$	—		$	5,904		$	—		$	—		$	13,836
Excluding Divestitures:	West			Midwest			South			East			Central			Corporate			Total
Net (loss) income	$	11,348		$	16,698		$	12,747		$	12,874		$	13,070		$	(55,645	)	$	11,092
Interest expense, net		4,982			(1	)		4,353			12,691			13,306			36,467			71,798
(Benefit) provision for income taxes		4,283			6,337			1,923			5,385			1,657			(11,564	)		8,021
Unrealized loss on investments and marketable securities		—			—			—			—			—			1,398			1,398
Depreciation and amortization		13,508			5,764			9,850			10,597			11,480			1,741			52,940
Stock-based compensation		—			6			—			—			—			6,499			6,505
Transaction expenses(1)		—			—			—			—			—			7,292			7,292
Other(3)		184			17			236			(33	)		89			5,286			5,779
Adjusted EBITDA(5)	$	34,305		$	28,821		$	29,109		$	41,514		$	39,602		$	(8,526	)	$	164,825

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	Six Months Ended June 30, 2020
	West			Midwest			South			East			Central			Corporate			Total
Net loss	$	(104,011	)	$	(15,239	)	$	(24,910	)	$	(32,647	)	$	(15,728	)	$	(83,099	)	$	(275,634	)
Interest expense, net		10,466			(42	)		8,529			25,661			26,933			63,053			134,600
Benefit for income taxes		(16,720	)		(3,658	)		(4,286	)		(3,229	)		(1,285	)		(41,655	)		(70,833	)
Loss on extinguishment of debt		—			—			—			—			—			158			158
Unrealized loss on investments and marketable securities		—			—			—			—			—			10,202			10,202
Depreciation and amortization		27,237			8,670			13,906			22,287			23,556			3,716			99,372
Stock-based compensation		—			3			3			—			—			9,965			9,971
Transaction expenses(1)		—			—			—			—			—			21,991			21,991
Other(2)		103,387			36,701			21,986			265			14			(16	)		162,337
Adjusted EBITDA	$	20,359		$	26,435		$	15,228		$	12,337		$	33,490		$	(15,685	)	$	92,164
	Six Months Ended June 30, 2019
	West			Midwest			South			East			Central			Corporate			Total
Net (loss) income	$	15,665		$	43,590		$	32,956		$	27,149		$	25,948		$	(88,143	)	$	57,165
Interest expense, net		10,072			3			8,701			25,530			26,580			74,422			145,308
(Benefit) provision for income taxes		5,677			13,252			4,881			9,695			2,575			(15,257	)		20,823
Unrealized loss on investments and marketable securities		—			—			—			—			—			2,858			2,858
Depreciation and amortization		26,651			16,135			20,865			24,389			22,690			3,560			114,290
Stock-based compensation		—			25			9			7			—			11,416			11,457
Transaction expenses(1)		—			—			—			—			—			9,186			9,186
Other(3)		283			72			368			152			132			(16,781	)		(15,774	)
Adjusted EBITDA	$	58,348		$	73,077		$	67,780		$	86,922		$	77,925		$	(18,739	)	$	345,313
Divestitures:	West			Midwest			South			East			Central			Corporate			Total
Net income	$	—		$	9,887		$	—		$	5,229		$	—		$	—		$	15,116
Interest expense, net		—			—			—			23			—			—			23
Provision for income taxes		—			2,616			—			1,730			—			—			4,346
Depreciation and amortization		—			4,140			—			3,670			—			—			7,810
Stock-based compensation		—			11			—			7			—			—			18
Other(3)		—			—			—			78			—			—			78
Adjusted EBITDA(6)	$	—		$	16,654		$	—		$	10,737		$	—		$	—		$	27,391
Excluding Divestitures:	West			Midwest			South			East			Central			Corporate			Total
Net (loss) income	$	15,665		$	33,703		$	32,956		$	21,920		$	25,948		$	(88,143	)	$	42,049
Interest expense, net		10,072			3			8,701			25,507			26,580			74,422			145,285
(Benefit) provision for income taxes		5,677			10,636			4,881			7,965			2,575			(15,257	)		16,477
Unrealized loss on investments and marketable securities		—			—			—			—			—			2,858			2,858
Depreciation and amortization		26,651			11,995			20,865			20,719			22,690			3,560			106,480
Stock-based compensation		—			14			9			—			—			11,416			11,439
Transaction expenses(1)		—			—			—			—			—			9,186			9,186
Other(3)		283			72			368			74			132			(16,781	)		(15,852	)
Adjusted EBITDA(5)	$	58,348		$	56,423		$	67,780		$	76,185		$	77,925		$	(18,739	)	$	317,922

(1) Transaction expenses primarily represent costs related to the acquisition of Caesars for the three and six months ended June 30, 2020 and 2019, and costs related to the acquisitions of Elgin and Tropicana for the three and six months ended June 30, 2019.

(2) Other, for the three and six months ended June 30, 2020, is comprised of severance expense, (gain) loss on the sale or disposal of property and equipment, equity in income (loss) of unconsolidated affiliate and selling costs associated with the divestitures of Kansas City, Vicksburg, Shreveport, and MontBleu. For the six months ended June 30, 2020, other is also comprised of impairment charges.

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(3) Other, for the three and six months ended June 30, 2019, is comprised of severance expense, (gain) loss on the sale or disposal of property and equipment, equity in income (loss) of unconsolidated affiliate and the gain associated with the sales of Presque and Nemacolin. For the six months ended June 30, 2020, other is also comprised of impairment charges.

(4) Figures are for Mountaineer, Cape Girardeau and Caruthersville for the three months ended June 30, 2019.

(5) Total figures for the three months ended June 30, 2019 exclude the results of operations for Mountaineer, Cape Girardeau and Caruthersville. Total figures for the six months ended June 30, 2019 exclude the results of operations for Presque for the period beginning January 1, 2019 and ending January 11, 2019, Nemacolin for the period beginning January 1, 2019 and ending March 8, 2019 and Mountaineer, Cape Girardeau and Caruthersville for the six months ended June 30, 2019. Such presentation does not conform to GAAP or the Securities and Exchange Commission rules for pro forma presentation; however, we believe that the additional financial information will be helpful to investors in comparing current results with results of prior periods. This is non-GAAP data and should not be considered a substitute for data prepared in accordance with GAAP, but should be viewed in addition to the results of operations reported by the Company.

(6) Figures are for Presque for the period beginning January 1, 2019 and ending January 11, 2019, Nemacolin for the period beginning January 1, 2019 and ending March 8, 2019 and Mountaineer, Cape Girardeau and Caruthersville for the six months ended June 30, 2019.

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