Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 21, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 0-24206 | ||
Entity Registrant Name | PENN NATIONAL GAMING, INC. | ||
Entity Central Index Key | 0000921738 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Incorporation, State or Country Code | PA | ||
Entity Tax Identification Number | 23-2234473 | ||
Entity Address, Address Line One | 825 Berkshire Blvd., Suite 200 | ||
Entity Address, City or Town | Wyomissing, | ||
Entity Address, State or Province | PA | ||
Entity Address, Postal Zip Code | 19610 | ||
City Area Code | 610 | ||
Local Phone Number | 373-2400 | ||
Title of 12(b) Security | Common Stock, $0.01 par value per share | ||
Trading Symbol | PENN | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Smaller Reporting Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2.2 | ||
Entity Common Stock, Shares Outstanding | 116,864,066 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive 2020 proxy statement, anticipated to be filed with the Securities and Exchange Commission within 120 days after the end of the registrant’s fiscal year, are incorporated by reference into Part III of this Form 10-K. |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 437.4 | $ 479.6 |
Receivables, net of allowance for doubtful accounts of $7.7 and $3.2 | 88.7 | 106.8 |
Prepaid expenses | 76.7 | 63 |
Other current assets | 40 | 28.2 |
Total current assets | 642.8 | 677.6 |
Property and equipment, net | 5,120.2 | 6,868.8 |
Investment in and advances to unconsolidated affiliates | 128.3 | 128.5 |
Goodwill | 1,270.7 | 1,228.4 |
Other intangible assets, net | 2,026.5 | 1,856.9 |
Deferred income taxes | 0 | 80.6 |
Operating lease right-of-use assets | 4,613.3 | 0 |
Finance lease right-of-use assets | 224 | 0 |
Other assets | 168.7 | 120.2 |
Total assets | 14,194.5 | 10,961 |
Current liabilities | ||
Accounts payable | 40.3 | 30.5 |
Current maturities of long-term debt | 62.9 | 62.1 |
Current portion of financing obligations | 40.5 | 67.8 |
Current portion of operating lease liabilities | 124.1 | 0 |
Current portion of finance lease liabilities | 6.5 | 0 |
Accrued expenses and other current liabilities | 631.3 | 578 |
Total current liabilities | 905.6 | 738.4 |
Long-term debt, net of current maturities and debt issuance costs | 2,322.2 | 2,350.1 |
Long-term portion of financing obligations | 4,102.2 | 7,080.6 |
Long-term portion of operating lease liabilities | 4,450.6 | 0 |
Long-term portion of finance lease liabilities | 219.4 | 0 |
Deferred income taxes | 244.6 | 0 |
Other long-term liabilities | 98 | 60.7 |
Total liabilities | 12,342.6 | 10,229.8 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity | ||
Common stock ($0.01 par value, 200,000,000 shares authorized, 118,125,652 and 118,855,201 shares issued, and 115,958,259 and 116,687,808 shares outstanding) | 1.2 | 1.2 |
Treasury stock, at cost, (2,167,393 shares held in both periods) | (28.4) | (28.4) |
Additional paid-in capital | 1,718.3 | 1,726.4 |
Retained earnings (accumulated deficit) | 161.6 | (968) |
Total Penn National stockholders’ equity | 1,852.7 | 731.2 |
Non-controlling interest | (0.8) | 0 |
Total stockholders’ equity | 1,851.9 | 731.2 |
Total liabilities and stockholders’ equity | 14,194.5 | 10,961 |
Series B preferred stock ($0.01 par value, 1,000,000 shares authorized, no shares issued and outstanding) | ||
Stockholders’ equity | ||
Preferred stock | 0 | 0 |
Series C preferred stock ($0.01 par value, 18,500 shares authorized, no shares issued and outstanding) | ||
Stockholders’ equity | ||
Preferred stock | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Allowance for doubtful accounts | $ 7.7 | $ 3.2 |
Preferred stock, par value (in dollars per share) | $ 0.01 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 118,125,652 | 118,855,201 |
Common stock, shares outstanding (in shares) | 115,958,259 | 116,687,808 |
Treasury stock, shares (in shares) | 2,167,393 | 2,167,393 |
Series B Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Series C Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 18,500 | 18,500 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues | |||
Revenues | $ 5,301.4 | $ 3,587.9 | $ 3,331.5 |
Less: Promotional allowance | 0 | 0 | (183.5) |
Total revenues | 5,301.4 | 3,587.9 | 3,148 |
Operating expenses | |||
General and administrative | 1,187.7 | 618.9 | 514.5 |
Depreciation and amortization | 414.2 | 269 | 267.1 |
Impairment losses | 173.1 | 34.9 | 18 |
Provision for (recoveries on) loan loss and unfunded loan commitments | 0 | (17) | 89.8 |
Total operating expenses | 4,729.5 | 2,953.8 | 2,702.3 |
Operating income | 571.9 | 634.1 | 445.7 |
Other income (expenses) | |||
Interest expense, net | (534.2) | (538.4) | (463.2) |
Income from unconsolidated affiliates | 28.4 | 22.3 | 18.7 |
Loss on early extinguishment of debt | 0 | (21) | (24) |
Other | 20 | (7.1) | (2.3) |
Total other expenses | (485.8) | (544.2) | (470.8) |
Income (loss) before income taxes | 86.1 | 89.9 | (25.1) |
Income tax benefit (expense) | (43) | 3.6 | 498.5 |
Net income | 43.1 | 93.5 | 473.4 |
Less: Net loss attributable to non-controlling interest | 0.8 | 0 | 0 |
Net income attributable to Penn National | $ 43.9 | $ 93.5 | $ 473.4 |
Earnings per common share | |||
Basic earnings per common share (in dollars per share) | $ 0.38 | $ 0.96 | $ 5.21 |
Diluted earnings per common share (in dollars per share) | $ 0.37 | $ 0.93 | $ 5.07 |
Weighted-average basic shares outstanding (in shares) | 115.7 | 97.1 | 90.9 |
Weighted-average diluted shares outstanding (in shares) | 117.8 | 100.3 | 93.4 |
Gaming | |||
Revenues | |||
Revenues | $ 4,268.7 | $ 2,894.9 | $ 2,692 |
Operating expenses | |||
Cost of revenue | 2,281.8 | 1,551.4 | 1,365 |
Food, beverage, hotel and other | |||
Revenues | |||
Revenues | 1,032.7 | 629.7 | 601.7 |
Operating expenses | |||
Cost of revenue | 672.7 | 439.3 | 421.8 |
Management service and license fees | |||
Revenues | |||
Revenues | 0 | 6 | 11.7 |
Reimbursable management costs | |||
Revenues | |||
Revenues | 0 | 57.3 | 26.1 |
Operating expenses | |||
Cost of revenue | $ 0 | $ 57.3 | $ 26.1 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 43.1 | $ 93.5 | $ 473.4 |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustment during the period | 0 | 0 | 3.2 |
Other comprehensive income | 0 | 0 | 3.2 |
Total comprehensive income | 43.1 | 93.5 | 476.6 |
Less: Comprehensive loss attributable to non-controlling interest | 0.8 | 0 | 0 |
Comprehensive income attributable to Penn National | $ 43.9 | $ 93.5 | $ 476.6 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Millions | Total | Preferred Stock | Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accum- ulated Other Comprehensive Loss | Total Penn National Stock-holders’ Equity (Deficit) | Non-Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2016 | 0 | 91,122,308 | |||||||
Beginning balance at Dec. 31, 2016 | $ (543.4) | $ 0 | $ 0.9 | $ (28.4) | $ 1,014.1 | $ (1,525.3) | $ (4.7) | $ (543.4) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation arrangements (in shares) | 1,367,083 | ||||||||
Share-based compensation arrangements | 18.3 | 18.3 | 18.3 | ||||||
Foreign currency translation adjustment | $ 3.2 | 3.2 | 3.2 | ||||||
Share repurchases (in shares) | (1,264,149) | (1,264,149) | |||||||
Share repurchases | $ (24.8) | (24.8) | (24.8) | ||||||
Net income (loss) | 473.4 | 473.4 | 473.4 | ||||||
Ending balance (in shares) at Dec. 31, 2017 | 0 | 91,225,242 | |||||||
Ending balance at Dec. 31, 2017 | (73.3) | $ 0 | $ 0.9 | (28.4) | 1,007.6 | (1,051.9) | (1.5) | (73.3) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation arrangements (in shares) | 1,466,625 | ||||||||
Share-based compensation arrangements | 19.4 | 19.4 | 19.4 | ||||||
Foreign currency translation adjustment | 0 | ||||||||
Pinnacle Acquisition (in shares) | 26,295,439 | ||||||||
Pinnacle Acquisition | 749.7 | $ 0.3 | 749.4 | 749.7 | |||||
Reclassification of accumulated other comprehensive loss to earnings upon termination of management contract | $ 1.5 | 1.5 | 1.5 | ||||||
Share repurchases (in shares) | (2,299,498) | (2,299,498) | |||||||
Share repurchases | $ (50) | (50) | (50) | ||||||
Net income (loss) | 93.5 | 93.5 | 93.5 | ||||||
Ending balance (in shares) at Dec. 31, 2018 | 0 | 116,687,808 | |||||||
Ending balance at Dec. 31, 2018 | 731.2 | $ 0 | $ 1.2 | (28.4) | 1,726.4 | (968) | 0 | 731.2 | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation arrangements (in shares) | 542,274 | ||||||||
Share-based compensation arrangements | 16.8 | 16.8 | 16.8 | ||||||
Foreign currency translation adjustment | $ 0 | ||||||||
Share repurchases (in shares) | (1,271,823) | (1,271,823) | |||||||
Share repurchases | $ (24.9) | (24.9) | (24.9) | ||||||
Net income (loss) | 43.1 | 43.9 | 43.9 | (0.8) | |||||
Ending balance (in shares) at Dec. 31, 2019 | 0 | 115,958,259 | |||||||
Ending balance at Dec. 31, 2019 | $ 1,851.9 | $ 0 | $ 1.2 | $ (28.4) | $ 1,718.3 | $ 161.6 | $ 0 | $ 1,852.7 | $ (0.8) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities | |||
Net income | $ 43.1 | $ 93.5 | $ 473.4 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 414.2 | 269 | 267.1 |
Amortization of items charged to interest expense | 7.7 | 6.4 | 7 |
Noncash operating lease expense | 100.4 | 0 | 0 |
Change in fair value of contingent purchase price | 7 | 0.5 | (6.8) |
Holding gain on equity securities | (19.9) | 0 | 0 |
Loss on sale or disposal of property and equipment | 5.5 | 3.2 | 0.2 |
Income from unconsolidated affiliates | (28.4) | (22.3) | (18.7) |
Return on investment from unconsolidated affiliates | 29 | 27 | 26.5 |
Deferred income taxes | 21.1 | (26.7) | (517.9) |
Stock-based compensation | 14.9 | 12 | 7.8 |
Impairment losses | 173.1 | 34.9 | 18 |
Provision for (recoveries on) loan loss and unfunded loan commitments | 0 | (17) | 89.8 |
Reclassification of accumulated other comprehensive loss to earnings upon termination of management contract | 0 | 1.5 | 0 |
Loss on early extinguishment of debt | 0 | 21 | 24 |
Changes in operating assets and liabilities, net of businesses acquired | |||
Accounts receivable | 27 | (1.8) | (9.2) |
Prepaid expenses and other current assets | 9.7 | 13.3 | (7.3) |
Other assets | (2.3) | 1.5 | 2.4 |
Accounts payable | 4.4 | (6.1) | (0.4) |
Accrued expenses | (3.9) | (47) | 55.2 |
Income taxes | (7.2) | (3.3) | 20.4 |
Operating lease liabilities | (139.1) | 0 | 0 |
Other current and long-term liabilities | 47.6 | (6.8) | 46.3 |
Net cash provided by operating activities | 703.9 | 352.8 | 477.8 |
Investing activities | |||
Project capital expenditures | (25.1) | (2.9) | (25.1) |
Maintenance capital expenditures | (165.5) | (89.7) | (74.2) |
Consideration paid for acquisitions of businesses, net of cash acquired | (1,359.4) | (1,945.2) | (127.7) |
Proceeds from sale-and-leaseback transactions in conjunction with acquisitions | 961.1 | 0 | 0 |
Cash received for the sale of the Divested Properties and Belterra Park | 0 | 661.7 | 0 |
Consideration paid for gaming licenses and other intangible assets | (11.7) | (81.6) | (1.6) |
Acquisition of equity securities | (5.1) | 0 | 0 |
Additional contributions from (to) joint ventures | (0.4) | 18.9 | (0.5) |
Proceeds from sale of loan | 0 | 15.2 | 0 |
Receipts applied against nonaccrual loan | 0 | 0.5 | 8.2 |
Other | (1.4) | 0 | (0.7) |
Net cash used in investing activities | (607.5) | (1,423.1) | (221.6) |
Financing activities | |||
Proceeds from revolving credit facility | 412 | 201 | 256.4 |
Repayments on revolving credit facility | (384) | (89) | (447.4) |
Proceeds from issuance of long-term debt | 0 | 1,558.9 | 1,200 |
Principal payments on long-term debt | (46.6) | (482.5) | (1,127.5) |
Prepayment penalties and modification payments incurred with debt refinancing | 0 | (11.3) | (18) |
Debt issuance costs and debt discount | 0 | (27.3) | (25.6) |
Payments of other long-term obligations | (15.4) | (15.7) | (35.4) |
Principal payments on financing obligations | (51.6) | (67.4) | (57.8) |
Principal payments on finance leases | (6.2) | 0 | 0 |
Proceeds from the sale of real estate assets in conjunction with acquisitions | 250 | 82.6 | |
Proceeds from exercise of options | 1.9 | 7.4 | 10.4 |
Repurchase of common stock | (24.9) | (50) | (24.8) |
Payments of contingent purchase price | (3.9) | (4.1) | (19.6) |
Proceeds from insurance financing | 16.1 | 13.1 | 11.9 |
Payments on insurance financing | (19.4) | (11) | (12.2) |
Other | (0.4) | 0 | 0 |
Net cash provided by (used in) financing activities | (122.4) | 1,272.1 | (207) |
Change in cash, cash equivalents, and restricted cash | (26) | 201.8 | 49.2 |
Cash, cash equivalents and restricted cash at the beginning of the year | 481.2 | 279.4 | 230.2 |
Cash, cash equivalents and restricted cash at the end of the year | 455.2 | 481.2 | 279.4 |
Reconciliation of cash, cash equivalents and restricted cash: | |||
Total cash, cash equivalents and restricted cash | 481.2 | 481.2 | 230.2 |
Supplemental disclosure: | |||
Cash paid for interest, net of amounts capitalized | 528.1 | 530.4 | 452.8 |
Cash payments (refunds) related to income taxes, net | 21.8 | 24.4 | (43.1) |
Non-cash investing activities: | |||
Commencement of operating leases | 713.5 | 0 | 0 |
Commencement of finance leases | 4.6 | 0 | 0 |
Accrued capital expenditures | 12.6 | 7.7 | 1.9 |
Acquisition of equity securities | 16.1 | 0 | 0 |
Accrued advances to Jamul Tribe | $ 0 | $ 0 | $ 2.5 |
Organization and Basis of Prese
Organization and Basis of Presentation | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Note 1—Organization and Basis of Presentation Organization: Penn National Gaming, Inc., together with its subsidiaries, is a leading, diversified, multi-jurisdictional owner and manager of gaming and racing properties and video gaming terminal (“VGT”) operations. We currently offer live sports betting at our properties in Indiana, Iowa, Mississippi, Nevada, Pennsylvania and West Virginia. We operate an interactive gaming (“iGaming”) division through our subsidiary, Penn Interactive Ventures, LLC (“Penn Interactive”), which recently launched an online casino in Pennsylvania through our HollywoodCasino.com gaming platform and entered into multi-year agreements with leading sports betting operators for online sports betting and iGaming market access across our portfolio of properties. Our MYCHOICE ® customer loyalty program (the “my choice program”) provides its members with various benefits, including complimentary goods and/or services. References herein to “Penn National,” the “Company,” “we,” “our,” or “us” refer to Penn National Gaming, Inc. and its subsidiaries, except where stated or the context otherwise indicates. As of December 31, 2019 , we owned, managed, or had ownership interests in 41 properties in 19 states. The majority of the real estate assets (i.e., land and buildings) used in the Company’s operations are subject to triple net master leases; the most significant of which are the Penn Master Lease and the Pinnacle Master Lease (as such terms are defined in Note 11, “Leases,” and collectively referred to as the “ Master Leases ”), with Gaming and Leisure Properties, Inc. (NASDAQ: GLPI) (“GLPI”), a real estate investment trust (“REIT”). In May 2019, we acquired Greektown Casino-Hotel (“Greektown”) in Detroit, Michigan, subject to a triple net lease with VICI Properties Inc. (NYSE: VICI) (“VICI” and collectively with GLPI, our “REIT Landlords”) (the “Greektown Lease”) and, in January 2019, we acquired Margaritaville Casino Resort (“Margaritaville”) in Bossier City, Louisiana, subject to a triple net lease with VICI (the “Margaritaville Lease” and collectively with the Master Leases, the Greektown Lease and the Meadows Lease (as defined in Note 3, “New Accounting Pronouncements” ), the “Triple Net Leases”). In October 2018, the Company completed the acquisition of Pinnacle Entertainment, Inc. (“Pinnacle”), a leading regional gaming operator (the “Pinnacle Acquisition”), which added 12 gaming properties to our holdings. For more information on our acquisitions, see Note 5, “Acquisitions and Other Investments.” Basis of Presentation: The Consolidated Financial Statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2—Significant Accounting Policies Principles of Consolidation: The Consolidated Financial Statements include the accounts of Penn National Gaming, Inc. and its subsidiaries. Investments in and advances to unconsolidated affiliates that do not meet the consolidation criteria of the authoritative guidance for voting interest entities (“VOEs”) or variable interest entities (“VIEs”) are accounted for under the equity method. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates: The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements , and (iii) the reported amounts of revenues and expenses during the reporting period. Estimates used by us include, among other things, the useful lives for depreciable and amortizable assets, the allowance for doubtful accounts receivable, income tax provisions, the evaluation of the future realization of deferred tax assets, determining the adequacy of reserves for self-insured liabilities, the liabilities associated with our my choice program, the initial measurements of financing obligations associated with the Master Leases , projected cash flows in assessing the recoverability of long-lived assets, asset impairments, goodwill and other intangible assets, projected cash flows in assessing the initial valuation of intangible assets in conjunction with acquisitions, the initial selection of useful lives for depreciable and amortizable assets in conjunction with acquisitions, contingencies and litigation, and stock-based compensation expense. Actual results may differ from those estimates. Segment Information: We view each of our gaming and racing properties as an operating segment with the exception of our two properties in Jackpot, Nevada, which we view as one operating segment. We consider our combined VGT operations, by state, to be separate operating segments. See Note 17, “Segment Information,” for further information. For financial reporting purposes, we aggregate our operating segments into the following four reportable segments: Location Real Estate Assets Lease or Ownership Structure Northeast segment Ameristar East Chicago East Chicago, Indiana Pinnacle Master Lease Greektown Casino-Hotel (1) Detroit, Michigan Greektown Lease Hollywood Casino Bangor Bangor, Maine Penn Master Lease Hollywood Casino at Charles Town Races Charles Town, West Virginia Penn Master Lease Hollywood Casino Columbus Columbus, Ohio Penn Master Lease Hollywood Casino Lawrenceburg Lawrenceburg, Indiana Penn Master Lease Hollywood Casino at Penn National Race Course Grantville, Pennsylvania Penn Master Lease Hollywood Casino Toledo Toledo, Ohio Penn Master Lease Hollywood Gaming at Dayton Raceway Dayton, Ohio Penn Master Lease Hollywood Gaming at Mahoning Valley Race Course Youngstown, Ohio Penn Master Lease Marquee by Penn (2) Pennsylvania N/A Meadows Racetrack and Casino Washington, Pennsylvania Meadows Lease Plainridge Park Casino Plainville, Massachusetts Pinnacle Master Lease South segment (3) 1 st Jackpot Casino Tunica, Mississippi Penn Master Lease Ameristar Vicksburg Vicksburg, Mississippi Pinnacle Master Lease Boomtown Biloxi Biloxi, Mississippi Penn Master Lease Boomtown Bossier City Bossier City, Louisiana Pinnacle Master Lease Boomtown New Orleans New Orleans, Louisiana Pinnacle Master Lease Hollywood Casino Gulf Coast Bay St. Louis, Mississippi Penn Master Lease Hollywood Casino Tunica Tunica, Mississippi Penn Master Lease L’Auberge Baton Rouge Baton Rouge, Louisiana Pinnacle Master Lease L’Auberge Lake Charles Lake Charles, Louisiana Pinnacle Master Lease Margaritaville Resort Casino (4) Bossier City, Louisiana Margaritaville Lease West segment Ameristar Black Hawk Black Hawk, Colorado Pinnacle Master Lease Cactus Petes and Horseshu Jackpot, Nevada Pinnacle Master Lease M Resort Henderson, Nevada Penn Master Lease Tropicana Las Vegas Las Vegas, Nevada Owned Zia Park Casino Hobbs, New Mexico Penn Master Lease Midwest segment Ameristar Council Bluffs Council Bluffs, Iowa Pinnacle Master Lease Argosy Casino Alton (5) Alton, Illinois Penn Master Lease Argosy Casino Riverside Riverside, Missouri Penn Master Lease Hollywood Casino Aurora Aurora, Illinois Penn Master Lease Hollywood Casino Joliet Joliet, Illinois Penn Master Lease Hollywood Casino at Kansas Speedway (6) Kansas City, Kansas Owned - JV Hollywood Casino St. Louis Maryland Heights, Missouri Penn Master Lease Prairie State Gaming (2) Illinois N/A River City Casino St. Louis, Missouri Pinnacle Master Lease (1) Acquired on May 23, 2019 (2) VGT route operations (3) Resorts Casino Tunica ceased operations on June 30, 2019, but remains subject to the Penn Master Lease. (4) Acquired on January 1, 2019 (5) The riverboat is owned by us and not subject to the Penn Master Lease. (6) Pursuant to a joint venture (“JV”) with International Speedway Corporation (“International Speedway”) and includes the Company’s 50% investment in Kansas Entertainment, LLC (“Kansas Entertainment”), which owns Hollywood Casino at Kansas Speedway. Cash and Cash Equivalents: The Company considers all cash balances and highly-liquid investments with original maturities of three months or less at the date of purchase to be cash and cash equivalents. Concentration of Credit Risk: Financial instruments that subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s policy is to limit the amount of credit exposure to any one financial institution, and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. The Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits. Concentration of credit risk, with respect to casino receivables, is limited through the Company’s credit evaluation process. The Company issues markers to approved casino customers only following investigations of creditworthiness. The Company’s receivables as of December 31, 2019 and 2018 primarily consisted of the following: December 31, (in millions) 2019 2018 Markers issued to customers $ 22.9 $ 17.2 Credit card receivables and other advances to customers 16.5 20.9 Receivables from ATM and cash kiosk transactions 14.4 19.2 Hotel and banquet receivables 6.5 8.1 Racing settlements 6.6 6.1 Receivables due from platform providers for social casino games 3.3 2.3 Other 26.2 36.2 Allowance for doubtful accounts (7.7 ) (3.2 ) Accounts receivable, net $ 88.7 $ 106.8 Accounts are written off when management determines that an account is uncollectible. Recoveries of accounts previously written off are recorded when received. An allowance for doubtful accounts is determined to reduce the Company’s receivables to their carrying amount, which approximates fair value. The allowance is estimated based on historical collection experience, specific review of individual customer accounts, and current economic and business conditions. Historically, the Company has not incurred any significant credit-related losses. Property and Equipment: Property and equipment are stated at cost, less accumulated depreciation. Capital expenditures are accounted for as either project capital or maintenance (replacement) capital expenditures. Project capital expenditures are for fixed asset additions that expand an existing facility or create a new facility. Maintenance capital expenditures are expenditures to replace existing fixed assets with a useful life greater than one year that are obsolete, worn out or no longer cost-effective to repair. Maintenance and repairs that neither add materially to the value of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the determination of income. The estimated useful lives of property and equipment are determined based on the nature of the assets as well as the Company’s current operating strategy. Depreciation of property and equipment is recorded using the straight-line method over the shorter of the estimated useful life of the asset or the related lease term, if any, as follows: Years Land improvements 15 Buildings and improvements 5 to 31 Vessels 10 to 35 Furniture, fixtures and equipment 3 to 31 All costs funded by the Company considered to be an improvement to the real estate assets subject to any of our Triple Net Leases are recorded as leasehold improvements. Leasehold improvements are depreciated over the shorter of the estimated useful life of the improvement or the related lease term. The Company reviews the carrying amount of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable based on undiscounted estimated future cash flows expected to result from its use and eventual disposition. The factors considered by the Company in performing this assessment include current operating results, trends and prospects, as well as the effect of obsolescence, demand, competition and other regulatory and economic factors. For purposes of recognizing and measuring impairment, assets are grouped at the individual property level representing the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets. In assessing the recoverability of the carrying amount of property and equipment, we must make assumptions regarding future cash flows and other factors. If these estimates or the related assumptions change in the future, we may be required to record an impairment loss for these assets. Such an impairment loss would be recognized as a non-cash component of operating income. See Note 7, “Property and Equipment.” Goodwill and Other Intangible Assets: Goodwill represents the future economic benefits of a business combination measured as the excess of the purchase price over the fair value of net assets acquired and has been allocated to our reporting units. Goodwill is tested annually, or more frequently if indicators of impairment exist. For the quantitative goodwill impairment test, an income approach, in which a discounted cash flow (“DCF”) model is utilized, and a market-based approach using guideline public company multiples of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) from the Company’s peer group are utilized in order to estimate the fair market value of the Company’s reporting units. In determining the carrying amount of each reporting unit that utilizes real estate assets subject to the Triple Net Leases, if and as applicable, (i) the Company allocates each reporting unit their pro-rata portion of the right-of-use (“ROU”) assets, lease liabilities, and/or financing obligations, and (ii) pushes down the carrying amount of the property and equipment subject to such leases. The Company compares the fair value of its reporting units to the carrying amounts. If the carrying amount of the reporting unit exceeds the fair value, an impairment is recorded equal to the amount of the excess (not to exceed the amount of goodwill allocated to the reporting unit). We consider our gaming licenses, trademarks, and certain other intangible assets to be indefinite-lived based on our future expectations to operate our gaming properties indefinitely as well as our historical experience in renewing these intangible assets at minimal cost with various state commissions. Indefinite-lived intangible assets are tested annually for impairment, or more frequently if indicators of impairment exist, by comparing the fair value of the recorded assets to their carrying amount. If the carrying amounts of the indefinite-lived intangible assets exceed their fair value, an impairment is recognized. The Company completes its testing of its indefinite-lived intangible assets prior to assessing the realizability of its goodwill. The Company assesses the fair value of its gaming licenses using the Greenfield Method under the income approach, which estimates the fair value using a DCF model assuming the Company built a casino with similar utility to that of the existing casino. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. The Company assesses the fair value of its trademarks using the relief-from-royalty method under the income approach. The principle behind this method is that the value of the trademark is equal to the present value of the after-tax royalty savings attributable to the owned trademark. Our annual goodwill and other indefinite-lived intangible assets impairment test is performed on October 1 st of each year. Once an impairment of goodwill or other intangible asset has been recorded, it cannot be reversed. Other intangible assets that have a definite-life are amortized on a straight-line basis over their estimated useful lives or related service contract. The Company reviews the carrying amount of its amortizing intangible assets for possible impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. If the carrying amount of the amortizing intangible assets exceed their fair value, an impairment loss is recognized. See Note 8, “Goodwill and Other Intangible Assets.” Equity Securities: The Company’s equity securities (including warrants) are measured at fair value each reporting period with unrealized holding gains and losses included in current period earnings. During the year ended December 31, 2019 , the Company recognized a holding gain of $19.9 million related to equity securities held as of December 31, 2019, which is included in “Other,” as reported in “Other income (expenses)” within our Consolidated Statements of Income. Financing Obligations: Subsequent to the adoption of Accounting Standards Codification (“ASC”) Topic 842, “Leases” (“ASC 842”) on January 1, 2019, certain of the components contained within our Master Leases (primarily buildings) are accounted for as financing obligations, rather than leases. Prior to the adoption of ASC 842, our Master Leases, in their entirety, were accounted for as financing obligations. See Note 3, “New Accounting Pronouncements,” for a discussion of the impact of ASC 842 on our Consolidated Financial Statements. On November 1, 2013, the Company spun-off its real estate assets into GLPI (the “Spin-Off”) and entered into the Penn Master Lease. This transaction did not meet all of the requirements for sale-leaseback accounting treatment under ASC Topic 840, “Leases,” (“ASC 840”); specifically, the Penn Master Lease contains provisions that indicate the Company has prohibited forms of continuing involvement in the leased assets, which are not a normal leaseback. Accordingly, at lease inception, we calculated a financing obligation based on the future minimum lease payments discounted at our estimated incremental borrowing rate at lease inception over the lease term of 35 years , which was determined to be 9.7% . The lease term included renewal options that were reasonably assured of being exercised and the funded construction of certain leased assets in development at the commencement of the Penn Master Lease . On October 15, 2018, in connection with the Pinnacle Acquisition, we assumed the Pinnacle Master Lease. Within a business combination, an arrangement that previously did not meet all of the requirements for sale-leaseback accounting treatment (and is accounted for as a financing obligation by the acquiree) retains its classification as a financing obligation on the acquiring entity’s consolidated balance sheets at the business combination date. As of the date of acquisition, we calculated the financing obligation based on the future minimum lease payments discounted at a rate determined to be fair value at the business combination date, which was determined to be 7.3% , over the remaining lease term of 32.5 years . The remaining lease term included renewal options that were reasonably assured of being exercised. Furthermore, in conjunction with the Pinnacle Acquisition, GLPI acquired the real estate assets associated with Plainridge Park Casino and leased back such assets to the Company pursuant to an amendment to the Pinnacle Master Lease (the “Plainridge Park Casino Sale-Leaseback”). The effective yield used to determine the financing obligation associated with the Plainridge Park Casino Sale-Leaseback was 9.6% . Subsequent to the adoption of ASC 842, minimum lease payments under our Master Lease are allocated between components that continue to be financing obligations (primarily buildings) and operating lease components (primarily land). Minimum lease payments related to financing obligations are recorded to interest expense and, in part, as repayments of principal reducing the associated financing obligations. Contingent payments are recorded as interest expense as incurred. The real estate assets subject to the Master Leases and which are accounted for as failed sales, are included in “Property and equipment, net” within the Company’s Consolidated Balance Sheets and are depreciated over the shorter of their remaining useful lives or lease term. Principal payments associated with financing obligations are presented as financing cash outflows and interest payments associated with financing obligations are presented as operating cash outflows within our Consolidated Statements of Cash Flows. For more information, see Note 7, “Property and Equipment,” and Note 11, “Leases.” Operating and Finance Leases: The Company determines if a contract is or contains a leasing element at contract inception or the date in which a modification of an existing contract occurs. In order for a contract to be considered a lease, the contract must transfer the right to control the use of an identified asset for a period of time in exchange for consideration. Control is determined to have occurred if the lessee has the right to (i) obtain substantially all of the economic benefits from the use of the identified asset throughout the period of use and (ii) direct the use of the identified asset. Upon adoption of ASC 842, we elected the following policies: (a) to account for lease and non-lease components as a single component for all classes of underlying assets and (b) to not recognize short-term leases (i.e., leases that are less than 12 months and do not contain purchase options) within the Consolidated Balance Sheets, with the expense related to these short-term leases recorded in total operating expenses within the Consolidated Statements of Income. The Company has leasing arrangements that contain both lease and non-lease components. We account for both the lease and non-lease components as a single component for all classes of underlying assets. In determining the present value of lease payments at lease commencement date, the Company utilizes its incremental borrowing rate based on the information available, unless the rate implicit in the lease is readily determinable. The liability for operating and finance leases is based on the present value of future lease payments. Operating lease expenses are recorded as rent expense, which is included within general and administrative expense, within the Consolidated Statements of Income and presented as operating cash outflows within the Consolidated Statements of Cash Flows. Finance lease expenses are recorded as amortization expense, which is included within depreciation and amortization expense within the Consolidated Statements of Income and interest expense over the lease term. Principal payments associated with finance leases are presented as financing cash outflows and interest payments associated with finance leases are presented as operating cash outflows within our Consolidated Statements of Cash Flows. Debt Discount and Debt Issuance Costs: Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense using the effective interest method over the contractual term of the underlying indebtedness. These costs are classified as a direct reduction of long-term debt within the Company’s Consolidated Balance Sheets. Self-Insurance Reserves: The Company is self-insured for employee health coverage, general liability and workers’ compensation up to certain stop-loss amounts (for general liability and workers’ compensation). We use a reserve method for each reported claim plus an allowance for claims incurred but not yet reported to a fully-developed claims reserve method based on an actuarial computation of ultimate liability. Self-insurance reserves are included in “Accrued expenses and other current liabilities” within the Company’s Consolidated Balance Sheets. Contingent Purchase Price: The consideration for the Company’s acquisitions may include future payments that are contingent upon the occurrence of a particular event. We record an obligation for such contingent payments at fair value as of the acquisition date. We revalue our contingent purchase price obligations each reporting period. Changes in the fair value of the contingent purchase price obligation can result from changes to one or multiple inputs, including adjustments to the discount rate and changes in the assumed probabilities of successful achievement of certain financial targets. The changes in the fair value of contingent purchase price are recognized within our Consolidated Statements of Income as a component of “General and administrative” expense. Income Taxes: Under ASC Topic 740, “Income Taxes” (“ASC 740”), deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The realizability of the net deferred tax assets is evaluated quarterly by assessing the valuation allowance and by adjusting the amount of the allowance, if necessary. The Company considers all available positive and negative evidence including projected future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. The evaluation of both positive and negative evidence is a requirement pursuant to ASC 740 in determining more-likely-than-not the net deferred tax assets will be realized. In the event the Company determines that the deferred income tax assets would be realized in the future in excess of their net recorded amount, an adjustment to the valuation allowance would be recorded, which would reduce the provision for income taxes. ASC 740 also creates a single model to address uncertainty in tax positions and clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in an enterprise’s financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. See Note 13, “Income Taxes.” Revenue Recognition: Our revenue from contracts with customers consists of gaming wagers, food and beverage transactions, retail transactions, hotel room sales, racing wagers, sports betting wagers, and management services related to the management of external casinos and reimbursable costs associated with management contracts. In May 2018, our management contract was terminated for Hollywood Casino-Jamul San Diego, which is located in San Diego, California. In addition, our management contract was terminated for Casino Rama, which is located in Ontario, Canada, in July 2018. See Note 4, “Revenue Disaggregation,” for information on our revenue by type and geographic location. The transaction price for a gaming wagering contract is the difference between gaming wins and losses, not the total amount wagered. The transaction price for food and beverage, hotel and retail contracts is the net amount collected from the customer for such goods and services. Sales tax and other taxes collected on behalf of governmental authorities are accounted for on the net basis and are not included in revenues or expenses. The transaction price for our racing operations, inclusive of live racing events conducted at our racing facilities and our import and export arrangements, is the commission received from the pari-mutuel pool less contractual fees and obligations primarily consisting of purse funding requirements, simulcasting fees, tote fees and certain pari-mutuel taxes that are directly related to the racing operations. The transaction price for our former management service contracts was the amount collected for services rendered in accordance with the contractual terms. The transaction price for the reimbursable costs associated with our former management contracts was the gross amount of the reimbursable expenditure, which primarily consisted of payroll costs incurred by the Company for the benefit of the managed entity. Since the Company was the controlling entity to the arrangement, the reimbursement was recorded on a gross basis with an offsetting amount charged to operating expense. Gaming revenue contracts involve two performance obligations for those customers earning points under our my choice program and a single performance obligation for customers that do not participate in the my choice program. The Company applies a practical expedient by accounting for its gaming contracts on a portfolio basis as opposed to an individual wagering contract. For purposes of allocating the transaction price in a gaming contract between the wagering performance obligation and the obligation associated with the loyalty points earned, we allocate an amount to the loyalty point contract liability based on the standalone selling price (“SSP”) of the points earned, which is determined by the value of a point that can be redeemed for slot play and complimentaries; such as, food and beverage at our restaurants, lodging at our hotels and products offered at our retail stores, less estimated breakage. The allocated revenue for gaming wagers is recognized when the wagering occurs as all such wagers settle immediately. The liability associated with the loyalty points is deferred and recognized as revenue when the customer redeems the loyalty points for slot play and complimentaries and such goods and services are delivered to the customer. Food and beverage, hotel and retail services have been determined to be separate, standalone performance obligations and the transaction price for such contracts is recorded as revenue as the good or service is transferred to the customer over their stay at the hotel or when the delivery is made for the food and beverage or retail product. Cancellation fees for hotel and meeting space services are recognized upon cancellation by the customer and are included in food, beverage, hotel and other revenue. Racing revenue contracts, inclusive of our (i) host racing facilities, (ii) import arrangements that permit us to simulcast in live racing events occurring at other racetracks, and (iii) export arrangements that permit our live racing events to be simulcast at other racetracks, provide access to and the processing of wagers into the pari-mutuel pool. The Company has concluded it is not the controlling entity to the arrangement, but rather functions as an agent to the pari-mutuel pool. Commissions earned from the pari-mutuel pool less contractual fees and obligations are recognized on a net basis, which is included within food, beverage, hotel and other revenues. Management services have been determined to be separate, standalone performance obligations and the transaction price for such contracts was recorded as services were performed. The Company recorded revenues on a monthly basis calculated by applying the contractual rate called for in the contracts. Penn Interactive generates in-app purchase and advertising revenues from free-to-play social casino games, which can be downloaded to mobile phones and tablets from digital storefronts. Players can purchase virtual playing credits within our social casino games, which allows for increased playing opportunities and functionality. Penn Interactive records deferred revenue from the sale of virtual playing credits and recognizes this revenue over the average redemption period of the credits, which is approximately three days . Advertising revenues are recognized in the period when the advertising impression, click or install delivery occurs. Penn Interactive also generates revenue through revenue-sharing arrangements with third-party content providers whereby revenues are recognized on a net basis since Penn Interactive is not the controlling entity in the arrangement. Complimentaries associated with Gaming Contracts Food and beverage, hotel, and other services furnished to patrons for free as an inducement to gamble or through the redemption of our customers’ loyalty points are recorded as food and beverage, hotel, and other revenues, at their estimated SSPs with an offset recorded as a reduction to gaming revenues. The cost of providing complimentary goods and services to patrons as an inducement to gamble as well as for the fulfillment of our loyalty point obligation is included in food, beverage, hotel, and other expenses. Revenues recorded to food and beverage, hotel, and other and offset to gaming revenues were as follows: For the year ended December 31, (in millions) 2019 2018 Food and beverage $ 261.4 $ 137.2 Hotel 159.6 60.8 Other 17.6 8.1 Total complimentaries associated with gaming contracts $ 438.6 $ 206.1 Customer-related Liabilities The Company has three general types of liabilities related to contracts with customers: (i) the obligation associated with our my choice program (loyalty points and tier status benefits), (ii) advance payments on goods and services yet to be provided and for unpaid wagers, and (iii) deferred revenue associated with third-party sports betting operators for online sports betting and related iGaming market access. Our my choice program allows members to utilize their reward membership cards to earn loyalty points that are redeemable for slot play and complimentaries, such as food and beverage at our restaurants, lodging at our hotels and products offered at our retail stores across the vast majority of our properties. In addition, members of the my choice program earn credit toward tier status, which entitles them to receive certain other benefits, such as gifts. The Company accounts for the obligation associated with our my choice program utilizing a deferred revenue model, which defers revenue at the point in time when the loyalty points and tier status benefits are earned by our customers. Deferred revenue associated with the my choice program is recognized at the point-in-time when the loyalty points are redeemed by our customers or at the point-in-time when our customers receive the tier status benefits. The obligation associated with our my choice program is based on the estimated SSP of the loyalty points and the tier status benefits earned after factoring in the likelihood of redemption. The obligation associated with our my choice program, which is included in “Accrued expenses and other current liabilities” within our Consolidated Balance Sheets, was $36.2 million and $39.9 million as of December 31, 2019 and 2018 , respectively, and consisted principally of the obligation associated with the loyalty points. Our loyalty point obligations are generally settled within six months of issuance. Changes between the opening and closing balances primarily relate to the timing of our customers’ election to redeem loyalty points as well as the timing of when our customers receive their earned tier status benefits. The Company’s advance payments on goods and services yet to be provided and for unpaid wagers primarily consist of the following: (i) deposits on rooms and conventio |
New Accounting Pronouncements
New Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | Note 3—New Accounting Pronouncements Accounting Pronouncements Implemented in 2019 On January 1, 2019, the Company adopted ASC 842, and all the related amendments (the “new lease standard”) using the modified retrospective method with an effective date of January 1, 2019 (the “adoption date”) and a cumulative-effect adjustment to retained earnings. The core principle of ASC 842 is that a lessee should recognize on the balance sheet the lease assets and lease liabilities that arise from all lease arrangements with terms greater than 12 months. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. As part of the adoption, the Company elected to utilize the package of practical expedients included in this guidance, which permitted the Company to not reassess (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) the initial direct costs for existing leases. Master Leases The most significant impact of the adoption of the new lease standard relates to the accounting for our Master Leases with GLPI. Under previous GAAP, as contained within ASC 840, the Company concluded that (i) the Penn Master Lease and (ii) the Pinnacle Master Lease to each be a failed sale-leaseback transaction resulting in (a) the land and building assets associated with the Master Leases to be recognized in “Property and equipment, net” within the Consolidated Balance Sheets, (b) the recognition of a financing obligation, with the associated interest recorded to “Interest expense, net” within the Consolidated Statements of Income, and (c) the contingent rentals to be recorded as additional interest expense. Under the provisions of the new lease standard, the Company was required to evaluate its existing sale-leaseback transactions with GLPI to determine whether a sale had occurred, and if a sale had occurred, to determine the classification (operating or finance) of each component contained within each of the Master Leases. Lease components contained within each of the Master Leases that were determined to be operating leases (consisting primarily of the land components) at the adoption date resulted in (i) the derecognition of the existing financing obligation and the carrying amount of the property and equipment with an adjustment to the opening balance of retained earnings and (ii) the recognition of an operating lease liability and an operating lease ROU asset. Lease components contained within each of the Master Leases that were determined to continue to be financing obligations (consisting primarily of the building components) at the adoption date resulted in (i) the continued recognition of the leased assets in “Property and equipment, net” within our Consolidated Balance Sheets and (ii) the continued recognition of the financing obligation utilizing assumptions as determined (a) at the lease commencement date with respect to the Penn Master Lease or (b) at the acquisition date with respect to the Pinnacle Master Lease. Our Hollywood Casino at Dayton Raceway and Hollywood Casino at Mahoning Valley Race Course (“Dayton and Mahoning Valley”) properties included within the Penn Master Lease were previously accounted for under build-to-suit guidance pursuant to ASC 840. The Company was required to evaluate the components contained within the build-to-suit arrangements and determine the classification (operating or finance) under the provisions of the new lease standard at the adoption date. The Dayton and Mahoning Valley lease components were determined to be finance leases, which resulted in (i) the recognition of a finance lease ROU asset (recorded to depreciation and amortization expense over the lease term), (ii) a corresponding finance lease liability (recorded to interest expense over the lease term), and (iii) a write-off of the previous (a) carrying amount of the property and equipment and (b) financing obligation recorded with an adjustment to the opening balance of retained earnings at the adoption date. Operating Leases, inclusive of the Meadows Lease The adoption of the new lease standard required us to recognize ROU assets and lease liabilities that had not previously been recorded within the Consolidated Balance Sheets. Upon adoption, the lease liability for operating leases was based on the present value of future lease payments and the ROU asset for operating leases was based on the operating lease liability adjusted for the reclassification of certain balance sheet amounts, such as deferred rent. Under ASC 842, deferred and prepaid rent are no longer presented separately. Leases that are short-term in nature are not recognized as ROU assets within the Consolidated Balance Sheets, but are recognized as an expense (recorded within total operating expenses) within the Consolidated Statements of Income. The impact of the adoption of the new lease standard on our Consolidated Balance Sheets at January 1, 2019 was as follows (only financial statement line items impacted are presented): Impacts of: (in millions) As Reported as of December 31, 2018 Financing Obligations - Master Leases (1) Finance Leases - Dayton and Mahoning Valley Operating Leases - Master Leases (2) Operating Lease - Meadows (3) Other Operating Leases - Non-Master Leases As Adjusted for ASC 842 Increase/(Decrease) Assets Current assets Prepaid expenses $ 63.0 $ — $ — $ — $ — $ (1.0 ) $ 62.0 $ (1.0 ) Total current assets $ 677.6 $ — $ — $ — $ — $ (1.0 ) $ 676.6 $ (1.0 ) Property and equipment, net (4) $ 6,868.8 $ — $ (164.3 ) $ (1,407.4 ) $ — $ — $ 5,297.1 $ (1,571.7 ) Goodwill $ 1,228.4 $ 5.5 $ — $ — $ — $ — $ 1,233.9 $ 5.5 Operating lease right-of-use assets (5) $ — $ — $ — $ 3,541.2 $ 112.8 $ 152.5 $ 3,806.5 $ 3,806.5 Finance lease right-of-use assets (6) $ — $ — $ 224.5 $ — $ — $ — $ 224.5 $ 224.5 Total assets $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 Liabilities Current liabilities Current portion of financing obligations (7) $ 67.8 $ — $ (1.5 ) $ (16.2 ) $ — $ — $ 50.1 $ (17.7 ) Current portion of operating lease liabilities (5) $ — $ — $ — $ 72.9 $ 20.5 $ 8.9 $ 102.3 $ 102.3 Current portion of finance lease liabilities (6) $ — $ — $ 5.8 $ — $ — $ — $ 5.8 $ 5.8 Accrued expenses and other current liabilities $ 578.0 $ — $ — $ — $ — $ (0.5 ) $ 577.5 $ (0.5 ) Total current liabilities $ 738.4 $ — $ 4.3 $ 56.7 $ 20.5 $ 8.4 $ 828.3 $ 89.9 Long-term portion of financing obligations (7) $ 7,080.6 $ 5.5 $ (181.3 ) $ (2,760.6 ) $ — $ — $ 4,144.2 $ (2,936.4 ) Long-term portion of operating lease liabilities (5) $ — $ — $ — $ 3,467.1 $ 92.3 $ 145.0 $ 3,704.4 $ 3,704.4 Long-term portion of finance lease liabilities (6) $ — $ — $ 218.3 $ — $ — $ — $ 218.3 $ 218.3 Deferred income taxes (8) $ — $ — $ 4.3 $ 299.5 $ — $ — $ 303.8 $ 303.8 Other long-term liabilities $ 60.7 $ — $ — $ — $ — $ (1.9 ) $ 58.8 $ (1.9 ) Total liabilities $ 10,229.8 $ 5.5 $ 45.6 $ 1,062.7 $ 112.8 $ 151.5 $ 11,607.9 $ 1,378.1 Stockholders’ equity Retained earnings (accumulated deficit) $ (968.0 ) $ — $ 14.6 $ 1,071.1 $ — $ — $ 117.7 $ 1,085.7 Total Penn National stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total liabilities and stockholders’ equity $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 (1) During the first quarter of 2019, the Company identified an adjustment to the purchase price allocation associated with the Pinnacle Acquisition. The purchase price adjustment increased the financing obligation upon the adoption of the new lease standard, resulting in an increase to goodwill (see Note 5, “Acquisitions and Other Investments” ). (2) Represents components contained within each of the Master Leases determined to be operating leases (primarily land). (3) Represents the triple net lease with GLPI for the real estate assets used in the operations of Meadows Racetrack and Casino (the “Meadows Lease”). (4) Represents the (i) derecognition of the carrying amount of the property and equipment, net, associated with land components contained within our Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) derecognition of the carrying amount of the property and equipment, net, associated with land and building components associated with Dayton and Mahoning Valley determined to be finance leases upon the adoption of the new lease standard. (5) Operating lease ROU assets represent (i) the land components contained within the Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) with respect to other Operating Leases, represent (a) the Meadows Lease, which was acquired by the Company in conjunction with the acquisition of Pinnacle; (b) ground and levee leases with landlords, which were not assumed by GLPI and remain an obligation of the Company; and (c) buildings and equipment not associated with our Master Leases. For leases where the rate implicit in the lease was not readily determinable, we used our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. We utilized the incremental borrowing rate on the adoption date for operating leases that commenced prior to that date. The operating lease liability is based on the net present value of future lease payments. (6) Amounts primarily represent finance leases associated with Dayton and Mahoning Valley, which are included in the Penn Master Lease, that under ASC 840 utilized specific build-to-suit guidance. The adoption of the new lease standard required the Company to evaluate the components under current guidance contained within the new lease standard, which resulted in all components being classified as finance leases. Finance leases result in (i) the recognition of a finance lease ROU asset amortized over the lease term and (ii) a corresponding finance lease liability (recorded to interest expense over the lease term). We utilized our incremental borrowing rate based on the information available at the adoption date in determining the present value of lease payments. The finance lease liability is based on the net present value of future lease payments. (7) Represents components associated with our Master Leases that remain financing obligations (primarily buildings). The financing obligation at the adoption date was calculated utilizing previous assumptions as determined (a) at the lease commencement date with respect to the Penn Master Lease and (b) at the acquisition date with respect to the Pinnacle Master Lease. (8) Represents the tax impacts related to the adoption of the new lease standard. See Note 13, “Income Taxes.” Accounting Pronouncements to be Implemented in 2020 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurements of Credit Losses on Financial Instruments” (“ASU 2016-13”), which sets forth a “current expected credit loss” (referred to as “CECL”) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and must be applied through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. Although we are still finalizing our assessment of the impact of the adoption of ASU 2016-13, which is effective January 1, 2020, we currently do not expect it to have a material impact on our Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-15, “Customer’s Accounting for Implementation Cost Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”). Under the new guidance, customers will apply the same criteria for capitalizing implementation costs as they would for an arrangement that has a software license. This will result in certain implementation costs being capitalized; the associated amortization charge will, however, be recorded as an operating expense. Under the previous guidance, costs incurred when implementing a cloud computing arrangement deemed to be a service contract are recorded as an operating expense when incurred. ASU 2018-15 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities can choose to adopt the new guidance prospectively to eligible costs incurred on or after the date the guidance is first applied or retrospectively. We have elected to adopt the net guidance on a prospective basis. Although we are still finalizing our assessment of the impact of the adoption of ASU 2018-15, which is effective January 1, 2020, we currently do not expect it to have a material impact on our Consolidated Financial Statements. Accounting Pronouncements to be Implemented in 2021 In December 2019, the FASB issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which intends to simplify the guidance by removing certain exceptions to the general principles and clarifying or amending existing guidance. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Although we are currently evaluating the impact of the adoption of ASU 2019-12, we do not expect it to have a material impact on our Consolidated Financial Statements. |
Revenue Disaggregation
Revenue Disaggregation | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Disaggregation | Note 4—Revenue Disaggregation We generate revenues at our owned, managed, or operated properties principally by providing the following types of services: (i) gaming, (ii) food and beverage, (iii) hotel, (iv) racing, (v) reimbursable management costs and (vi) other. Other revenues is principally comprised of ancillary gaming-related activities, such as commissions received on ATM transactions, and iGaming. In addition, we assess our revenues based on geographic location of the related properties, which is consistent with our reportable segments (see Note 17, “Segment Information,” for further information). Our revenue disaggregation by type of revenue and geographic location was as follows: For the year ended December 31, 2019 (in millions) Northeast South West Midwest Other Intersegment Eliminations (1) Total Revenues: Gaming $ 2,117.1 $ 831.1 $ 374.3 $ 938.1 $ 8.8 $ (0.7 ) $ 4,268.7 Food and beverage 155.1 154.1 116.7 84.7 1.4 — 512.0 Hotel 43.5 98.2 125.9 43.4 — — 311.0 Racing 25.1 — 0.6 — 5.6 — 31.3 Other 59.1 35.5 25.0 28.3 31.7 (1.2 ) 178.4 Total revenues $ 2,399.9 $ 1,118.9 $ 642.5 $ 1,094.5 $ 47.5 $ (1.9 ) $ 5,301.4 (1) Represents the elimination of intersegment revenues associated with our internally-branded retail sportsbooks, which are operated by Penn Interactive, and our live and televised poker tournament series that operates under the trademark, Heartland Poker Tour (“HPT”). For the year ended December 31, 2018 (in millions) Northeast South West Midwest Other Total Revenues: Gaming $ 1,644.2 $ 302.9 $ 228.0 $ 719.8 $ — $ 2,894.9 Food and beverage 109.6 56.6 89.6 57.9 1.1 314.8 Hotel 23.2 23.3 90.8 26.3 — 163.6 Racing 20.3 — 0.6 — 5.9 26.8 Reimbursable management costs 46.8 — 10.5 — — 57.3 Other 47.4 11.6 18.4 19.7 33.4 130.5 Total revenues $ 1,891.5 $ 394.4 $ 437.9 $ 823.7 $ 40.4 $ 3,587.9 For the year ended December 31, 2017 (in millions) Northeast South West Midwest Other Total Revenues: Gaming $ 1,583.9 $ 203.0 $ 219.7 $ 685.4 $ — $ 2,692.0 Food and beverage 115.0 35.5 82.4 58.4 1.1 292.4 Hotel 21.5 10.3 76.1 22.0 — 129.9 Racing 49.6 — 2.3 — 10.8 62.7 Reimbursable management costs — — 26.1 — — 26.1 Other 48.7 6.3 16.6 16.4 40.4 128.4 1,818.7 255.1 423.2 782.2 52.3 3,331.5 Less: Promotional allowances (62.1 ) (30.8 ) (42.8 ) (47.2 ) (0.6 ) (183.5 ) Total revenues $ 1,756.6 $ 224.3 $ 380.4 $ 735.0 $ 51.7 $ 3,148.0 |
Acquisitions and Other Investme
Acquisitions and Other Investments | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations And Other Investments [Abstract] | |
Acquisitions and Other Investments | Note 5—Acquisitions and Other Investments Greektown Casino-Hotel On May 23, 2019, the Company acquired all of the membership interests of Greektown Holdings, L.L.C., for a net purchase price of $320.3 million , after working capital and other adjustments, pursuant to a transaction agreement among the Company, VICI Properties L.P., a wholly-owned subsidiary of VICI, and Greektown Mothership LLC. In connection with the acquisition, the real estate assets relating to Greektown were acquired by a subsidiary of VICI for an aggregate sales price of $700.0 million and the Company entered into the Greektown Lease, which has an initial annual rent of $55.6 million and an initial term of 15 years , with four five -year renewal options. The acquisition of the operations was financed through a combination of cash on hand and incremental borrowings under the Company’s Revolving Credit Facility (as defined in Note 10, “Long-term Debt” ). The Company is in the process of finalizing the assumptions that derive the fair value of certain assets acquired and liabilities assumed. Therefore, the allocation of the purchase price is preliminary and subject to change. During the year ended December 31, 2019 , subsequent to the date of acquisition, we made the following adjustments to the preliminary purchase price: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Estimated fair value, as adjusted Cash and cash equivalents $ 31.1 $ — $ 31.1 Receivables, prepaid expenses, and other current assets 15.7 (1.2 ) 14.5 Property and equipment 32.3 (3.9 ) 28.4 Goodwill (2) 61.7 5.7 67.4 Other intangible assets Gaming license 166.4 — 166.4 Trademark 24.4 — 24.4 Customer relationships 3.3 — 3.3 Operating lease right-of-use assets 516.1 — 516.1 Finance lease right-of-use assets 4.1 — 4.1 Other assets 0.2 (0.2 ) — Total assets $ 855.3 $ 0.4 $ 855.7 Accounts payable, accrued expenses and other current liabilities $ 14.8 $ 0.4 15.2 Operating lease liabilities 516.1 — 516.1 Finance lease liabilities 4.1 — 4.1 Total liabilities 535.0 0.4 535.4 Net assets acquired $ 320.3 $ — $ 320.3 (1) Amounts were initially reported within the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2019, filed with the SEC on August 8, 2019. (2) The goodwill has been assigned to our Northeast segment. The entire $67.4 million goodwill amount is deductible for tax purposes. The Company used the income, market, or cost approach (or a combination thereof) for the valuation, as appropriate, and used valuation inputs in these models and analyses that were based on market participant assumptions. Market participants are considered to be buyers and sellers unrelated to the Company in the principal or most advantageous market for the asset or liability. Property and equipment acquired consists of non-REIT assets (e.g., equipment for use in gaming operations, furniture and other equipment). We determined that the land and buildings subject to the Greektown Lease, which was entered into at the time of the acquisition, represented operating lease ROU assets with a corresponding operating lease liability calculated based on the present value of the future lease payments at the acquisition date in accordance with GAAP. Management determined the fair value of its office equipment, computer equipment and slot machine gaming devices based on the market approach and other personal property based on the cost approach, supported where available by observable market data, which includes consideration of obsolescence. Acquired identifiable intangible assets consist of a gaming license and a trademark, which are both indefinite-lived intangible assets, and customer relationships, which is an amortizing intangible asset with an assigned useful life of 2 years . Management valued (i) the gaming license using the Greenfield Method under the income approach; (ii) the trademark using the relief-from-royalty method under the income approach; and (iii) customer relationships (rated player databases) using the with-and-without method of the income approach. All valuation methods are forms of the income approach supported by observable market data for peer casino operator companies. See Note 2, “Significant Accounting Policies,” for more information. The following table includes the financial results of Greektown since the acquisition date, which is included within our Consolidated Statement of Income for the year ended December 31, 2019: (in millions) Period from May 23, 2019 through December 31, 2019 Revenues $ 195.9 Net income $ 10.9 Margaritaville Resort Casino On January 1, 2019, the Company acquired the operations of Margaritaville for a net purchase price of $122.9 million , after working capital and other adjustments, pursuant to (i) an agreement and plan of merger (the “Margaritaville Merger Agreement”) among the Company, VICI, Bossier Casino Venture (HoldCo), Inc. (“Holdco”), and Silver Slipper Gaming, LLC, and (ii) a membership interest purchase agreement (the “MIPA”) among VICI and the Company. Pursuant to the Margaritaville Merger Agreement, a subsidiary of VICI merged with and into Holdco with Holdco surviving the merger as a wholly-owned subsidiary of VICI (the “Merger”) and owner of the real estate assets relating to Margaritaville. Pursuant to the MIPA, immediately following the consummation of the Merger, HoldCo sold its interests in its sole direct subsidiary and owner of the Margaritaville operating assets, to the Company. In connection with the acquisition, the real estate assets used in the operations of Margaritaville were acquired by VICI for $261.1 million and the Company entered into the Margaritaville Lease, which has an initial annual rent of $23.2 million and an initial term of 15 years , with four five -year renewal options. The acquisition of the operations was financed through incremental borrowings under the Company’s Revolving Credit Facility. During the fourth quarter of 2019, the Company finalized the allocation of the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed, with the excess recorded as goodwill. During the year ended December 31, 2019 , prior to its finalization, we made the following adjustments to the preliminary purchase price allocation: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Fair value, as finalized Cash and cash equivalents $ 10.7 $ — $ 10.7 Receivables, prepaid expenses, and other current assets 7.1 (0.1 ) 7.0 Property and equipment 21.7 (1.0 ) 20.7 Goodwill (2) 39.5 4.7 44.2 Other intangible assets Gaming license 48.1 — 48.1 Customer relationships 2.3 — 2.3 Operating lease right-of-use assets 196.2 — 196.2 Total assets $ 325.6 $ 3.6 $ 329.2 Accounts payable, accrued expenses and other current liabilities $ 9.5 $ 0.6 $ 10.1 Operating lease liabilities 196.2 — 196.2 Total liabilities 205.7 0.6 206.3 Net assets acquired $ 119.9 $ 3.0 $ 122.9 (1) Amounts were initially reported within the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2019, filed with the SEC on May 8, 2019. (2) The goodwill has been assigned to our South segment. The entire $44.2 million goodwill amount is deductible for tax purposes. The Company used the income, market, or cost approach (or a combination thereof) for the valuation, as appropriate, and used valuation inputs in these models and analyses that were based on market participant assumptions. Property and equipment acquired consists of non-REIT assets (e.g., equipment for use in gaming operations, furniture and other equipment). We determined that the land and buildings subject to the Margaritaville Lease, which was entered into at the time of the acquisition, represented operating lease ROU assets with a corresponding operating lease liability calculated based on the present value of the future lease payments at the acquisition date in accordance with GAAP. Management determined the fair value of its office equipment, computer equipment and slot machine gaming devices based on the market approach and other personal property based on the cost approach, supported where available by observable market data, which includes consideration of obsolescence. Acquired identifiable intangible assets consist of a gaming license, which is an indefinite-lived intangible asset, and a customer relationship, which is an amortizing intangible asset with an assigned useful life of 2 years . Management valued (i) the gaming license using the Greenfield Method under the income approach and (ii) the customer relationships using the with-and-without method of the income approach. All valuation methods are forms of the income approach supported by observable market data for peer casino operator companies. See Note 2, “Significant Accounting Policies,” for more information. The following table includes the financial results of Margaritaville since the acquisition date, which is included within our Consolidated Statement of Income for the year ended December 31, 2019: (in millions) For the year ended December 31, 2019 Revenues $ 157.6 Net income $ 13.7 Pinnacle Acquisition On October 15, 2018, the Company acquired all of the outstanding shares of Pinnacle, for a total purchase price of $2,816.2 million , which consisted of (i) a cash payment of $20.00 per share of Pinnacle common stock, totaling $1,252.2 million ; (ii) issuance of Penn National common stock in the amount of $749.7 million ; and (iii) the retirement of $814.3 million of Pinnacle debt obligations. In conjunction with the Pinnacle Acquisition, the Company divested the membership interests of certain Pinnacle subsidiaries, which operated the casinos known as Ameristar St. Charles, Ameristar Kansas City, Belterra Resort and Belterra Park (referred to collectively as the “Divested Properties”), to Boyd Gaming Corporation (NYSE: BYD). Additionally, as a part of the transaction, (i) GLPI acquired the real estate assets associated with Plainridge Park Casino, and concurrently leased back such assets to the Company. In connection with the sale of the Divested Properties and the Plainridge Park Casino Sale-Leaseback, the Pinnacle Master Lease, which was assumed by the Company concurrent with the closing of the Pinnacle Acquisition, was amended. The Pinnacle Acquisition added 12 gaming properties to our holdings and provides us with greater operational scale and geographic diversity. For more information on the Pinnacle Master Lease and related amendment, see Note 11, “Leases.” During the third quarter of 2019, the Company finalized the allocation of the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed, with the excess recorded as goodwill. During the year ended December 31, 2019 , prior to its finalization, we made the following adjustments to the preliminary purchase price allocation: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Fair value, as finalized Cash and restricted cash $ 124.2 $ — $ 124.2 Assets held for sale 667.0 0.5 667.5 Other current assets 80.6 0.5 81.1 Property and equipment - non-Pinnacle Master Lease 318.9 (0.3 ) 318.6 Property and equipment - Pinnacle Master Lease (2) 3,984.1 (29.2 ) 3,954.9 Goodwill (3) 219.5 18.7 238.2 Other intangible assets Gaming licenses 1,046.0 21.6 1,067.6 Trademarks 298.0 — 298.0 Customer relationships 22.4 — 22.4 Other long-term assets 38.9 — 38.9 Total assets $ 6,799.6 $ 11.8 $ 6,811.4 Long-term financing obligation, including current portion (4) $ 3,427.0 $ 5.5 $ 3,432.5 Other current liabilities 200.6 5.5 206.1 Deferred tax liabilities 339.2 0.8 340.0 Other long-term liabilities 16.6 — 16.6 Total liabilities 3,983.4 11.8 3,995.2 Net assets acquired $ 2,816.2 $ — $ 2,816.2 (1) Amounts were initially reported within the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on February 28, 2019. (2) Includes buildings, boats, vessels, barges, and implied land and land use rights. Land use rights represent the intangible value of the Company’s ability to utilize and access land associated with long term ground lease agreements that give the Company the exclusive rights to operate the casino gaming facilities associated with such agreements. (3) See Note 8, “Goodwill and Other Intangible Assets,” for details on the impact to each reportable segment. (4) Long-term financing obligation, including current portion represents the financing obligation associated with Pinnacle Master Lease, as amended. Pro Forma Financial Information - Greektown, Margaritaville, and Pinnacle The following table includes unaudited pro forma consolidated financial information assuming our acquisitions of Greektown and Margaritaville had occurred as of January 1, 2018 and Pinnacle had occurred as of January 1, 2017. The pro forma financial information does not represent the anticipated future results of the combined company. The pro forma amounts include the historical operating results of Penn National, Greektown, Margaritaville, and Pinnacle, prior to the acquisition, with adjustments directly attributable to the acquisitions, inclusive of adjustments for acquisition costs. The below pro forma results do not include any adjustments related to synergies. For the year ended December 31, (in millions) 2019 2018 2017 Revenues $ 5,434.9 $ 5,552.2 $ 5,036.6 Net income (loss) $ 64.9 $ 101.9 $ (38.0 ) 1 st Jackpot Casino and Resorts Casino Tunica On May 1, 2017, the Company acquired the operations of 1 st Jackpot Casino and Resorts Casino Tunica, for a net purchase price of $47.0 million . In connection with the acquisitions, the real estate assets relating to 1 st Jackpot Casino and Resorts Casino Tunica were acquired by GLPI for an aggregate sales price of $82.6 million and included in the Penn Master Lease . Resorts Casino Tunica ceased operations on June 30, 2019. Rocket Speed In August 2016, Penn Interactive acquired 100% of the outstanding equity securities of social casino game developer, Rocket Speed, Inc. (“Rocket Speed”), for initial cash consideration of $60.5 million subject to customary working capital adjustments. The stock purchase agreement included contingent payments over the next two years that were based on a multiple of 6.25 times Rocket Games’ then trailing- twelve -months EBITDA, subject to a cap of $110.0 million . Up to $10.0 million of the contingent purchase price was accounted for as compensation as it was tied to continued employment over a two -year period. The fair value of the contingent purchase price was estimated to be $34.4 million at the acquisition date. In September 2017, Penn Interactive reached an agreement with the former shareholders of Rocket Speed to buy out the remaining contingent purchase price, which resulted in a benefit of $22.2 million , which is included within “General and administrative” within our Consolidated Statements of Income for the year ended December 31, 2017. Jamul Indian Village Development Corporation In April 2013, the Company and the Jamul Tribe, a federally recognized Indian Tribe holding a government-to-government relationship with the U.S., entered into definitive agreements to assist the Jamul Tribe in the development of a Hollywood Casino-branded casino on the Jamul Tribe’s trust land in San Diego County, California. In addition, the definitive agreements and a related loan commitment letter set forth the terms and conditions under which the Company would provide loans to the Jamul Indian Village Development Corporation (the “JIVDC”) to fund certain development costs. Following the opening, the Company also managed the property. In October 2016, the JIVDC obtained long-term secured financing, consisting of a revolving credit facility, a term loan B facility and a term loan C facility (the “Term Loan C Facility” and collectively with the revolving credit facility and the term loan B facility, the “Credit Facilities”) totaling approximately $460 million . The Company was the lender under the Term Loan C Facility in the amount of $98.0 million . As of December 31, 2017, the JIVDC breached one of the financial covenants contained within the Credit Facilities, resulting in default. Consequently, the Company performed an analysis of the expected future cash flows it would receive based on forecasted operations of the property, discounted at the Term Loan C Facility’s effective interest rate, as well as any concessions it would grant to the JIVDC. As a result of such analysis, the Company recorded a charge of $86.0 million for the year ended December 31, 2017, of which $64.0 million pertained to the Term Loan C Facility and $22.0 million was a reserve for unfunded loan commitments. In addition, the Company recorded charges of $3.8 million related to certain advances made to the JIVDC. In February 2018, the Company and the Jamul Tribe mutually agreed that the Company would no longer manage the property nor provide branding and development services as of May 28, 2018. On May 25, 2018, the Company entered into a purchase agreement with the senior lender under the Credit Facilities for the property to sell them all of the Company’s outstanding rights and obligations under the Term Loan C Facility and the JIVDC commitments. As a result, the Company received cash proceeds of $15.2 million from the sale and was relieved of all rights and obligations with respect to the JIVDC. The sale of the loan resulted in a recovery of loan losses and unfunded loan commitments of $17.0 million for the year ended December 31, 2018 . |
Investments in and Advances to
Investments in and Advances to Unconsolidated Affiliates | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in and Advances to Unconsolidated Affiliates | Note 6—Investments in and Advances to Unconsolidated Affiliates As of December 31, 2019 and 2018 , investments in and advances to unconsolidated affiliates primarily consisted of the Company’s 50% interest in Kansas Entertainment, which is a JV with International Speedway that owns Hollywood Casino at Kansas Speedway, its JV with MAXXAM, Inc. (“MAXXAM”), and its JV with Greenwood Limited Jersey, Inc. (“Greenwood”). Kansas Joint Venture As of December 31, 2019 and 2018 , our investment in Kansas Entertainment was $90.8 million and $89.4 million , respectively. During the years ended December 31, 2019 , 2018 and 2017 , the Company received distributions from Kansas Entertainment totaling $29.0 million , $27.0 million and $26.0 million , respectively, which the Company deemed to be returns on its investment based on the source of those cash flows from the normal business operations of Kansas Entertainment. As of the years ended December 31, 2019 and 2018 , we determined that Kansas Entertainment does not qualify as a VIE. Using the guidance for entities that are not VIEs, the Company determined that it did not have a controlling financial interest in the JV as of and for the years ended December 31, 2019 and 2018 , primarily as it did not have the ability to direct the activities of the JV that most significantly impacted the JV’s economic performance without the input of International Speedway. Therefore, the Company did not consolidate its investment in the JV as of and for the years ended December 31, 2019 and 2018 . For the year ended December 31, 2019 , our investment in Kansas Entertainment met the requirements to provide summarized balance sheet and income statement information for the comparative periods that are included within our Consolidated Financial Statements: December 31, (in millions) 2019 2018 Current assets $ 21.5 $ 18.3 Long-term assets $ 159.2 $ 161.0 Current liabilities $ 13.5 $ 15.1 For the year ended December 31, (in millions) 2019 2018 2017 Revenues $ 162.3 $ 159.0 $ 155.7 Operating expenses 101.3 110.4 114.7 Operating income 61.0 48.6 41.0 Net income $ 61.0 $ 48.6 $ 41.0 Net income attributable to Penn National $ 30.5 $ 24.3 $ 20.5 In addition, for the year ended December 31, 2019 , we determined that it was required to provide audited financial statements of Kansas Entertainment. The audited financial statements of Kansas Entertainment for the years ended June 30, 2019 , 2018 and 2017 are provided as exhibits to this Annual Report on Form 10-K for the year ended December 31, 2019 . Texas and New Jersey Joint Ventures The Company has a 50% interest in a JV with MAXXAM, which owns and operates the Sam Houston Race Park in Houston, Texas and the Valley Race Park in Harlingen, Texas, and holds a license for a racetrack in Austin, Texas. Sam Houston Race Park hosts thoroughbred and quarter-horse racing and offers daily simulcast operations, and Valley Race Park features dog racing and simulcasting. In addition, through a separate arrangement, the Company has a 50% interest in a JV with Greenwood, which owns and operates Freehold Raceway, in Freehold, New Jersey. The property features a half-mile standardbred racetrack and a grandstand. As of December 31, 2019 and 2018 , we determined that neither our Texas JV nor our New Jersey JV qualify as a VIE. Using the guidance for entities that are not VIEs, in both cases, the Company determined that it did not have a controlling financial interest in either of the JVs as of and for the years ended December 31, 2019 and 2018 , primarily as it did not have the ability to direct the activities of either of the JVs that most significantly impacted the JVs’ economic performance without the input of MAXXAM or Greenwood, respectively. Therefore, the Company did not consolidate either of its investment in the JVs as of and for the years ended December 31, 2019 and 2018 . |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 7—Property and Equipment Property and equipment, net, consisted of the following: December 31, (in millions) 2019 2018 Property and equipment - Not Subject to Master Leases Land and improvements $ 353.2 $ 344.0 Building, vessels and improvements 420.4 343.0 Furniture, fixtures and equipment 1,598.3 1,565.8 Leasehold improvements 183.6 152.9 Construction in progress 59.3 25.5 2,614.8 2,431.2 Less: Accumulated depreciation (1,548.3 ) (1,400.2 ) 1,066.5 1,031.0 Property and equipment - Subject to Master Leases Land and improvements (1) 1,525.9 2,971.0 Building, vessels and improvements (1) 3,664.6 3,845.0 5,190.5 6,816.0 Less: Accumulated depreciation (1,136.8 ) (978.2 ) 4,053.7 5,837.8 Property and equipment, net $ 5,120.2 $ 6,868.8 (1) Upon adoption of ASC 842, approximately $1.4 billion of land was derecognized and replaced with operating lease ROU assets based on the present value of future lease payments and $180.4 million of building and improvements, gross, was derecognized and replaced with finance lease ROU assets based on the present value of future lease payments. See Note 3, “New Accounting Pronouncements.” Depreciation expense was as follows: For the year ended December 31, (in millions) 2019 2018 2017 Depreciation expense (1) $ 381.6 $ 251.9 $ 248.2 (1) Of such amounts, $158.9 million , $112.1 million , and $92.4 million , respectively, pertained to real estate assets subject to either of our Master Leases. During the year ended December 31, 2018, we recorded $34.3 million of impairment on the property and equipment associated with Resorts Casino Tunica, principally relating to the real estate assets subject to the Penn Master Lease, which is included in “Impairment losses” within our Consolidated Statements of Income. The charge was the result of an impairment assessment performed after reviewing the financial results and projected results of this property, which had been impacted by nearby competition. We subsequently ceased operations of Resorts Casino Tunica on June 30, 2019. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 8—Goodwill and Other Intangible Assets A reconciliation of goodwill and accumulated goodwill impairment losses, by reportable segment, is as follows: (in millions) Northeast South West Midwest Other Total Balance as of January 1, 2018 Goodwill, gross $ 792.0 $ 136.9 $ 159.0 $ 1,046.7 $ 155.3 $ 2,289.9 Accumulated goodwill impairment losses (707.6 ) (34.6 ) (16.6 ) (435.3 ) (87.7 ) (1,281.8 ) Goodwill, net 84.4 102.3 142.4 611.4 67.6 1,008.1 Goodwill acquired during year 56.4 48.3 51.4 63.4 0.8 220.3 Balance as of December 31, 2018 Goodwill, gross 848.4 185.2 210.4 1,110.1 156.1 2,510.2 Accumulated goodwill impairment losses (707.6 ) (34.6 ) (16.6 ) (435.3 ) (87.7 ) (1,281.8 ) Goodwill, net 140.8 150.6 193.8 674.8 68.4 1,228.4 Goodwill acquired during year 67.4 44.2 — — — 111.6 Impairment losses during year (10.3 ) (17.4 ) — (60.3 ) — (88.0 ) Other (1) (1.5 ) 7.2 6.4 6.6 — 18.7 Balance as of December 31, 2019 Goodwill, gross 914.3 236.6 216.8 1,116.7 156.1 2,640.5 Accumulated goodwill impairment losses (717.9 ) (52.0 ) (16.6 ) (495.6 ) (87.7 ) (1,369.8 ) Goodwill, net $ 196.4 $ 184.6 $ 200.2 $ 621.1 $ 68.4 $ 1,270.7 (1) Amounts relate to adjustments made to the preliminary purchase price allocation of Pinnacle during the year ended December 31, 2019 , prior to it being finalized, as described in Note 5, “Acquisitions and Other Investments” 2019 Annual Assessment for Impairment As a result of our 2019 annual assessment for impairment, we recognized impairments on our goodwill, gaming licenses, and trademarks, of $88.0 million , $62.6 million , and $20.0 million , respectively. The impairments of goodwill were largely driven by increases in the carrying amount of certain of our reporting units as a result of decreases in the allocated amount of the financing obligation to such reporting units, which was driven by the adoption of ASC 842. The impairments of gaming licenses and trademarks were largely driven by reductions in the long-term projections for certain of our properties where competition has increased due to expansion of gaming legislation, primarily within the Northeast segment. The estimated fair values of the reporting units were determined through a combination of a DCF model and a market-based approach, which utilized Level 3 inputs. The estimated fair values of the gaming licenses and trademarks were determined by using DCF models, which utilized Level 3 inputs. As noted in the table above, the goodwill impairments pertained to our Northeast, South and Midwest segments, in the amounts of $10.3 million , $17.4 million and $60.3 million , respectively. The gaming license impairments pertained to our Northeast and South segments in the amounts of $55.1 million and $7.5 million , respectively. The trademark impairments pertained to our Northeast, South and Midwest segments, in the amounts of $11.5 million , $6.5 million and $2.0 million , respectively. 2018 Annual Assessment for Impairment During the year ended December 31, 2018, the Company completed its 2018 annual assessment for impairment, which did not result in any impairment charges to goodwill or other intangible assets. 2017 Annual and Interim Assessments for Impairment During the third quarter of 2017, the Company identified an indicator of impairment on its goodwill as a result of a reversal of a significant deferred tax valuation allowance, which caused increases in the carrying amounts of certain of our reporting units. As a result of an interim assessment for impairment, one of our reporting units within the West segment was fully impaired, resulting in an impairment charge of $14.8 million , and the goodwill at Sanford-Orlando Kennel Club, which is included in the Other category, was partially impaired, resulting in an impairment charge of $3.2 million . The estimated fair values of the reporting units were determined by using DCF models, which utilized Level 3 inputs. During the year ended December 31, 2017, subsequent to the interim assessment discussed above, the Company completed its 2017 annual assessment for impairment, which did not result in any impairment charges to goodwill or other intangible assets. The aforementioned impairments are included in “Impairment losses” within our Consolidated Statements of Income. See Note 18, “Fair Value Measurements,” for quantitative information about the significant unobservable inputs used in the fair value measurements of other intangible assets. As of October 1, 2019, the date of the most recent annual impairment test, three reporting units had negative carrying amounts. The amount of goodwill at these reporting units was as follows (in millions): Northeast segment Hollywood Casino at Charles Town Races $ 8.7 Plainridge Park Casino $ 6.3 Midwest segment Ameristar Council Bluffs $ 36.2 The table below presents the gross carrying amount, accumulated amortization, and net carrying amount of each major class of other intangible assets: December 31, 2019 December 31, 2018 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Indefinite-lived intangible assets Gaming licenses $ 1,681.9 $ — $ 1,681.9 $ 1,498.3 $ — $ 1,498.3 Trademarks 302.4 — 302.4 298.0 — 298.0 Other 0.7 — 0.7 0.7 — 0.7 Amortizing intangible assets Customer relationships 104.4 (69.0 ) 35.4 98.8 (51.5 ) 47.3 Other 36.1 (30.0 ) 6.1 61.9 (49.3 ) 12.6 Total other intangible assets $ 2,125.5 $ (99.0 ) $ 2,026.5 $ 1,957.7 $ (100.8 ) $ 1,856.9 During the year ended December 31, 2019 , we paid $10.0 million for online and retail sports betting licenses in Pennsylvania and during the year ended December 31, 2018, we purchased two Category 4 gaming licenses to operate up to 750 slot machines and initially up to 30 table games, under each license, in York County, Pennsylvania for $50.1 million and in Berks County, Pennsylvania for $7.5 million , and iGaming and sports betting licenses in Pennsylvania for $20.0 million , all of which have been classified as indefinite-lived intangible assets. Amortization expense related to our amortizing intangible assets was $24.7 million , $17.1 million , and $18.9 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The following table presents the estimated amortization expense based on our amortizing intangible assets as of December 31, 2019 (in millions): Years ending December 31: 2020 $ 19.7 2021 5.8 2022 3.9 2023 3.6 2024 3.6 Thereafter 4.9 Total $ 41.5 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Note 9—Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: December 31, (in millions) 2019 2018 Accrued salaries and wages $ 142.1 $ 139.2 Accrued gaming, pari-mutuel, property, and other taxes 103.3 105.8 Accrued interest 13.0 15.8 Other accrued expenses (1) 225.8 204.6 Other current liabilities (2) 147.1 112.6 Accrued expenses and other current liabilities $ 631.3 $ 578.0 (1) Amounts include $38.3 million and $33.8 million , respectively, pertaining to the Company’s accrued progressive jackpot liability. Additionally, amounts include the obligation associated with our my choice program and the current portion of advance payments on goods and services yet to be provided and for unpaid wagers, which are discussed in Note 2, “Significant Accounting Policies.” (2) Amounts include $80.1 million and $64.1 million |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Note 10—Long-term Debt Long-term debt, net of current maturities, was as follows: December 31, (in millions) 2019 2018 Senior Secured Credit Facilities: Revolving Credit Facility due 2023 $ 140.0 $ 112.0 Term Loan A Facility due 2023 672.3 707.7 Term Loan B-1 Facility due 2025 1,117.5 1,128.7 5.625% Notes due 2027 400.0 400.0 Other long-term obligations 89.2 104.6 Capital leases (1) — 0.4 2,419.0 2,453.4 Less: Current maturities of long-term debt (62.9 ) (62.1 ) Less: Debt discount (2.4 ) (2.8 ) Less: Debt issuance costs (31.5 ) (38.4 ) $ 2,322.2 $ 2,350.1 (1) Reclassified to finance lease liabilities upon the adoption of ASC 842. The following is a schedule of future minimum repayments of long-term debt as of December 31, 2019 (in millions): Year ending December 31: 2020 $ 62.9 2021 81.4 2022 99.9 2023 683.1 2024 21.3 Thereafter 1,470.4 Total minimum payments $ 2,419.0 Senior Secured Credit Facilities On October 30, 2013, the Company entered into a credit agreement (the “2013 Credit Agreement”) providing for: (i) a five -year $500.0 million revolving credit facility (the “ 2013 Revolving Credit Facility ”), (ii) a five -year $500.0 million term loan A facility (the “ 2013 Term Loan A Facility ”) and (iii) a seven -year $250.0 million term loan B facility (the “ 2013 Term Loan B Facility ” and collectively with the 2013 Revolving Credit Facility and the 2013 Term Loan A Facility , the “ 2013 Senior Secured Credit Facilities ”). On April 28, 2015, the Company entered into an agreement to amend its 2013 Credit Agreement (the “Amended 2013 Credit Agreement”). In August 2015, the Amended 2013 Credit Agreement went into effect, which increased the capacity under the 2013 Revolving Credit Facility to $633.2 million and increased the 2013 Term Loan A Facility to $646.7 million . The Amended 2013 Credit Agreement did not impact the 2013 Term Loan B Facility . On January 19, 2017, the Company entered into an agreement to amend and restate its Amended 2013 Credit Agreement (the “2017 Credit Agreement”), which provided for: (i) a five -year $700.0 million revolving credit facility (the “Revolving Credit Facility”), a five -year $300.0 million term loan A facility (the “Term Loan A Facility”), and a seven -year $500.0 million Term Loan B facility (the “Term Loan B Facility” and collectively with the Revolving Credit Facility and the Term Loan A Facility, the “Senior Secured Credit Facilities”). On October 15, 2018, in connection with the Pinnacle Acquisition, we entered into an incremental joinder agreement (the “Incremental Joinder”), which amended the 2017 Credit Agreement (the “Amended 2017 Credit Agreement”). The Incremental Joinder provided for an additional $430.2 million of incremental loans having the same terms as the existing Term Loan A Facility, with the exception of extending the maturity date, and an additional $1,128.8 million of loans as a new tranche having new terms (the “Term Loan B-1 Facility”). The proceeds resulting from the Incremental Joinder were used; together with cash on hand and proceeds received from (i) newly-issued shares of the Company’s common stock, (ii) the sale of the Divested Properties, (iii) the Plainridge Park Casino Sale-Leaseback, and (iv) the sale of the real estate assets associated with Belterra Park; to (a) acquire all of the issued and outstanding equity interests of Pinnacle, (b) repay in full Pinnacle’s existing senior secured credit facilities at the time of the acquisition, (c) redeem, repurchase, defease or satisfy and discharge in full Pinnacle’s outstanding 5.625% senior notes due 2024, (d) repay in full the Company’s outstanding borrowings under its Term Loan B Facility at the time of the acquisition, and (e) pay fees, costs and expenses associated with the foregoing. With the exception of extending the maturity date, the Incremental Joinder did not impact the Revolving Credit Facility. The final maturity dates for the Term Loan A Facility and Term Loan B-1 Facility are October 19, 2023 and October 15, 2025, respectively. The applicable margin for the Term Loan A Facility ranges from 1.25% to 3.00% per annum for LIBOR loans and 0.25% to 2.00% per annum for base rate loans, in each case depending on the Consolidated Total Net Leverage Ratio (as defined in the Amended 2017 Credit Agreement) as of the most recent fiscal quarter. The applicable margin for the Term Loan B-1 Facility is 2.25% per annum for LIBOR loans and 1.25% per annum for base rate loans. The Term Loan B-1 Facility is subject to a LIBOR “floor” of 0.75% . Prior to extinguishment, the applicable margin for the Term Loan B Facility was 2.50% per annum for LIBOR loans and 1.50% per annum for base rate loans. In addition, we pay a commitment fee on the unused portion of the commitments under the Revolving Credit Facility at a rate that ranges from 0.20% to 0.50% per annum, depending on the Consolidated Total Net Leverage Ratio as of the most recent fiscal quarter. As of December 31, 2019 and 2018 , the Company had conditional obligations under letters of credit issued pursuant to the Senior Secured Credit Facilities with face amounts aggregating $30.0 million in both periods, resulting in $530.0 million and $558.0 million of available borrowing capacity under the Revolving Credit Facility, respectively. For the year ended December 31, 2018, in connection with the debt financing transactions relating to the Pinnacle Acquisition and principal repayments on the Term Loan B Facility, the Company recorded $5.5 million in refinancing costs and a $21.0 million loss on early extinguishment of debt, related to refinancing costs on the extinguishment of the Term Loan B Facility and the write-off of debt issuance costs and the discount on the Term Loan B Facility. For the year ended December 31, 2017, in connection with the repayment of the 2013 Senior Secured Credit Facilities , the Company recorded $1.7 million in refinancing costs and a $2.3 million loss on early extinguishment of debt, related to the write-off of debt issuance costs and the discount on the 2013 Term Loan B Facility . The refinancing costs are included in “Other,” as reported in “Other income (expenses)” within our Consolidated Statements of Income. The payment and performance of obligations under the Senior Secured Credit Facilities are guaranteed by a lien on and security interest in substantially all of the assets (other than excluded property, such as gaming licenses) of the Company. 5.625% Senior Unsecured Notes On January 19, 2017, the Company completed an offering of $400.0 million aggregate principal amount of 5.625% senior unsecured notes that mature on January 15, 2027 (the “ 5.625% Notes”) at a price of par. Interest on the 5.625% Notes is payable on January 15 th and July 15 th of each year. The 5.625% Notes will not be guaranteed by any of the Company’s subsidiaries except in the event that the Company in the future issues certain subsidiary-guaranteed debt securities. The Company may redeem the 5.625% Notes at any time on or after January 15, 2022, at the declining redemption premiums set forth in the indenture governing the 5.625% Notes, and, prior to January 15, 2022, at a “make-whole” redemption premium set forth in the indenture governing the 5.625% Notes. The Company used a portion of the proceeds from the issuance of the 5.625% Notes to retire its existing 5.875% Notes (as defined below) and, along with loans funded under the 2017 Credit Agreement, repay amounts outstanding under its Amended 2013 Credit Agreement, including to fund related transaction fees and expenses. The remaining proceeds from the issuance of the 5.625% Notes were used for general corporate purposes. Redemption of 5.875% Senior Subordinated Notes During the year ended December 31, 2017, the Company redeemed all of its $300.0 million 5.875% senior subordinated notes (“ 5.875% Notes”), which were due in 2021. In connection with this redemption, the Company recorded a $21.1 million loss on early extinguishment of debt for the year ended December 31, 2017 related to the difference between the reacquisition price of the 5.875% Notes and their carrying amount. Interest expense, net Interest expense, net, was as follows: For the year ended December 31, (in millions) 2019 2018 2017 Interest expense $ (535.9 ) $ (539.4 ) $ (467.0 ) Interest income 1.4 1.0 3.6 Capitalized interest 0.3 — 0.2 Interest expense, net $ (534.2 ) $ (538.4 ) $ (463.2 ) Covenants Our Senior Secured Credit Facilities and 5.625% Notes require us, among other obligations, to maintain specified financial ratios and to satisfy certain financial tests. In addition, our Senior Secured Credit Facilities and 5.625% Notes restrict, among other things, our ability to incur additional indebtedness, incur guarantee obligations, amend debt instruments, pay dividends, create liens on assets, make investments, engage in mergers or consolidations, and otherwise restrict corporate activities. As of December 31, 2019 , the Company was in compliance with all required financial covenants. Other Long-Term Obligations Ohio Relocation Fees As of December 31, 2019 and 2018 , other long-term obligations included $76.4 million and $91.3 million , respectively, related to the relocation fees for Dayton and Mahoning Valley, which opened in August 2014 and September 2014, respectively. In June 2013, we finalized the terms of our memorandum of understanding with the State of Ohio, which included an agreement for us to pay a relocation fee in return for being able to relocate our existing racetracks in Toledo and Grove City to Dayton and Mahoning Valley, respectively. Upon opening Dayton and Mahoning Valley, each relocation fee was recorded at the present value of the contractual obligation, which was calculated as $75.0 million based on the 5.0% discount rate included in the agreement. Each relocation fee is payable as follows: $7.5 million upon opening and eighteen semi-annual payments of $4.8 million beginning one year after opening. This obligation is accreted to interest expense at an effective yield of 5.0% . The amount included in interest expense related to this obligation was $4.1 million , $4.8 million and $5.5 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. Event Center As of December 31, 2019 and 2018 , other long-term obligations included $12.6 million and $13.2 million , respectively, related to the repayment obligation of a hotel and event center located less than a mile away from Hollywood Casino Lawrenceburg, which was constructed by the City of Lawrenceburg Department of Redevelopment. Effective in January 2015, by contractual agreement, we assumed a repayment obligation for the hotel and event center in the amount of $15.3 million , which was financed through a loan with the City of Lawrenceburg Department of Redevelopment, in exchange for conveyance of the property. Beginning in January 2016, the Company was obligated to make annual payments on the loan of $1.0 million for 20 years . This obligation is accreted to interest expense at its effective yield of 3.0% . The amount included in interest expense related to this obligation was $0.4 million for each of the years ended December 31, 2019 , 2018 and 2017 . |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Note 11—Leases Lessee Master Leases Upon adoption of the new lease standard, components contained within the Master Leases were determined to be either (i) operating leases, (ii) finance leases, or (iii) financing obligations. Changes to future lease payments under the Master Leases (i.e., when future escalators become known or future variable rent resets occur), which are discussed below, require the Company to either (i) increase both the ROU assets and corresponding lease liabilities with respect to operating and finance leases or (ii) record the incremental variable payment associated with the financing obligation to interest expense. Penn Master Lease Pursuant to a triple net master lease with GLPI (the “Penn Master Lease”), which became effective November 1, 2013, the Company leases real estate assets associated with 19 of the gaming facilities used in its operations. The Penn Master Lease has an initial term of 15 years with four subsequent, five -year renewal periods on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 35 years . The payment structure under the Penn Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Penn Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted (i) every five years by an amount equal to 4% of the average change in net revenues of all properties under the Penn Master Lease (other than Hollywood Casino Columbus (“Columbus”) and Hollywood Casino Toledo (“Toledo”)) compared to a contractual baseline during the preceding five years (“Penn Percentage Rent”) and (ii) monthly by an amount equal to 20% of the net revenues of Columbus and Toledo in excess of a contractual baseline and subject to a rent floor specific to Toledo (see below). As a result of the annual escalator, the fixed component of rent increased by $5.5 million , $5.4 million and $2.4 million effective as of November 1, 2019 , 2018 and 2017 , respectively. Additionally, effective November 1, 2018, the Penn Percentage Rent reset resulted in an annual rent reduction of $11.3 million , which will be in effect until the next Penn Percentage Rent reset, occurring on November 1, 2023. As a result of the annual escalator effective November 1, 2019, an additional ROU asset and corresponding lease liability of $34.4 million were recognized associated with operating lease components and an additional ROU asset and corresponding lease liability of $3.1 million were recognized associated with finance lease components. The acquisition of Greektown on May 23, 2019 activated a competition clause within the Penn Master Lease, which introduced a rent floor specific to Toledo. As a result, an additional ROU asset and corresponding lease liability of $151.2 million were recognized associated with operating lease components. Lease payments resulting from the rent floor associated with components determined to continue to be financing obligations are included in “Interest expense, net” within our Consolidated Statements of Income. Monthly rent associated with Columbus and monthly rent in excess of the Toledo rent floor are considered contingent rent. Expense related to operating lease components associated with Columbus and Toledo are included in “General and administrative” within our Consolidated Statements of Income and the variable expense related to the financing obligation component is included in “Interest expense, net” within our Consolidated Statements of Income. The entire variable expense related to prior years was included in “Interest expense, net” pursuant to the failed sale-leaseback accounting treatment under ASC 840. Total monthly variable expenses were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Variable expenses included in “General and administrative” $ 16.4 $ — $ — Variable expenses included in “Interest expense, net” 16.1 48.9 46.8 Total variable expenses $ 32.5 $ 48.9 $ 46.8 Pinnacle Master Lease In connection with the Pinnacle Acquisition, we assumed a triple net master lease with GLPI (the “Pinnacle Master Lease”), originally effective April 28, 2016, pursuant to which the Company leases real estate assets associated with 12 of the gaming facilities used in its operations. Upon assumption of the Pinnacle Master Lease, as amended, there were 7.5 years remaining of the initial ten -year term, with five subsequent, five -year renewal periods, on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 32.5 years . The payment structure under the Pinnacle Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Pinnacle Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues compared to a contractual baseline during the preceding two years (“Pinnacle Percentage Rent”). As a result of the annual escalator, the fixed component of rent increased by $1.0 million effective as of May 1, 2019. The next Pinnacle Percentage Rent reset is scheduled to occur on May 1, 2020. As a result of the annual escalator, an additional ROU asset and corresponding lease liability of $3.8 million were recognized associated with operating lease components of the Pinnacle Master Lease. Operating Leases The Company’s operating leases consist mainly of (i) the Meadows Lease with GLPI, (ii) the Margaritaville Lease with VICI, (iii) the Greektown Lease with VICI, (iv) ground and levee leases to landlords which were not assumed by our REIT Landlords and remain an obligation of the Company, and (v) building and equipment not subject to the Master Leases. Certain of our lease agreements include rental payments based on a percentage of sales over specified contractual amounts, rental payments adjusted periodically for inflation, and rental payments based on usage. The Company’s leases include options to extend the lease terms. The Company’s operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. Meadows Lease, Margaritaville Lease, and Greektown Lease In connection with the Pinnacle Acquisition, we assumed the Meadows Lease, originally effective September 9, 2016. Upon assumption of the Meadows Lease, there were eight years remaining of the initial ten -year term, with three subsequent, five -year renewal options followed by one four -year renewal option on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Meadows Lease includes a fixed component (“Meadows Base Rent”), which is subject to an annual escalator of up to 5% for the initial term or until the lease year in which Meadows Base Rent plus Meadows Percentage Rent (as defined below) is a total of $31.0 million , subject to certain adjustments, and up to 2% thereafter, subject to an Adjusted Revenue to Rent Ratio (as defined in the Meadows Lease) of 2.0 :1. The “Meadows Percentage Rent” is based on performance, which is prospectively adjusted for the next two -year period equal to 4.0% of the average annual net revenues of the property during the trailing two -year period. As a result of the annual escalator, which was determined to be $0.8 million , effective October 1, 2019, an additional operating ROU asset and corresponding operating lease liability of $4.3 million were recognized. The next Meadows Percentage Rent reset is scheduled to occur on October 1, 2020. The Margaritaville Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Margaritaville Lease includes a fixed component (“Margaritaville Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Margaritaville Lease) of 1.9 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Margaritaville Percentage Rent”). The first Margaritaville Percentage Rent reset is scheduled to occur on February 1, 2021. On February 1, 2020, the Margaritaville Lease was amended to provide for a change in the measurement of the annual escalator. Under the amendment, the Margaritaville Base Rent is subject to an annual escalator of up to 2% subject to a minimum ratio of net revenue to rent of 6.1 :1. The Greektown Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Greektown Lease includes a fixed component (“Greektown Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Greektown Lease) of 1.85 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Greektown Percentage Rent”). The first Greektown Percentage Rent reset is scheduled to occur on June 1, 2021. Information related to lease term and discount rate was as follows: December 31, 2019 Weighted-Average Remaining Lease Term Operating leases 27.6 years Finance leases 28.6 years Financing obligations 30.4 years Weighted-Average Discount Rate Operating leases 6.7 % Finance leases 6.8 % Financing obligations 8.1 % The components of lease expense were as follows: Classification (in millions) Gaming Expense Food, Beverage, Hotel and Other Expense General and Administrative Interest Expense, net Depreciation and Amortization Total for the year ended December 31, 2019 Operating Lease Costs Rent expense associated with triple net leases classified as operating leases (1) $ — $ — $ 366.4 $ — $ — $ 366.4 Operating lease cost (2) 0.4 0.5 16.6 — — 17.5 Short-term lease cost 53.8 1.3 1.5 — — 56.6 Variable lease cost (2) 2.8 — 1.1 — — 3.9 Total $ 57.0 $ 1.8 $ 385.6 $ — $ — $ 444.4 Finance Lease Costs Interest expense (3) $ — $ — $ — $ 15.4 $ — $ 15.4 Amortization expense (3) — — — — 7.9 7.9 Total $ — $ — $ — $ 15.4 $ 7.9 $ 23.3 Financing Obligation Costs Interest expense (4) $ — $ — $ — $ 394.1 $ — $ 394.1 (1) Pertains to the components contained within the Master Leases (primarily land) determined to be operating leases, the Meadows Lease, the Margaritaville Lease, and the Greektown Lease, inclusive of the variable expense associated with Columbus and Toledo for the operating lease components (the land) (see table above). (2) Excludes the operating lease costs and variable lease costs pertaining to our triple net leases with our REIT landlords classified as operating leases, discussed in footnote (1) above. (3) Primarily pertains to the Dayton and Mahoning Valley finance leases. (4) Pertains to the components contained within the Master Leases (primarily buildings) determined to continue to be financing obligations, inclusive of the variable expense associated with Columbus and Toledo for the finance lease components (the buildings) (see table above). Total rent expense under all operating lease agreements pursuant to the accounting treatment under ASC 840 was $58.1 million and $45.4 million for the years ended December 31, 2018 and 2017, respectively. Supplemental cash flow information related to leases was as follows: (in millions) For the year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 15.4 Operating cash flows from operating leases $ 403.6 Financing cash flows from finance leases $ 6.2 The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 During the year ended December 31, 2019 , total payments made under the Triple Net Leases were $869.8 million . During the year ended December 31, 2018 , total payments made under the Master Leases and Meadows Lease were $537.4 million . During the year ended December 31, 2017, total payments made under the Penn Master Lease were $455.4 million . Lessor The Company leases its hotel rooms to patrons and records the corresponding lessor revenue in “Food, beverage, hotel and other revenues” within our Consolidated Statements of Income. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized $311.0 million , $163.6 million , and $129.9 million , of lessor revenues related to the rental of hotel rooms, respectively. Hotel leasing arrangements vary in duration, but are short-term in nature. The cost and accumulated depreciation of property and equipment associated with hotel rooms is included in “Property and equipment, net” within our Consolidated Balance Sheets. |
Leases | Note 11—Leases Lessee Master Leases Upon adoption of the new lease standard, components contained within the Master Leases were determined to be either (i) operating leases, (ii) finance leases, or (iii) financing obligations. Changes to future lease payments under the Master Leases (i.e., when future escalators become known or future variable rent resets occur), which are discussed below, require the Company to either (i) increase both the ROU assets and corresponding lease liabilities with respect to operating and finance leases or (ii) record the incremental variable payment associated with the financing obligation to interest expense. Penn Master Lease Pursuant to a triple net master lease with GLPI (the “Penn Master Lease”), which became effective November 1, 2013, the Company leases real estate assets associated with 19 of the gaming facilities used in its operations. The Penn Master Lease has an initial term of 15 years with four subsequent, five -year renewal periods on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 35 years . The payment structure under the Penn Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Penn Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted (i) every five years by an amount equal to 4% of the average change in net revenues of all properties under the Penn Master Lease (other than Hollywood Casino Columbus (“Columbus”) and Hollywood Casino Toledo (“Toledo”)) compared to a contractual baseline during the preceding five years (“Penn Percentage Rent”) and (ii) monthly by an amount equal to 20% of the net revenues of Columbus and Toledo in excess of a contractual baseline and subject to a rent floor specific to Toledo (see below). As a result of the annual escalator, the fixed component of rent increased by $5.5 million , $5.4 million and $2.4 million effective as of November 1, 2019 , 2018 and 2017 , respectively. Additionally, effective November 1, 2018, the Penn Percentage Rent reset resulted in an annual rent reduction of $11.3 million , which will be in effect until the next Penn Percentage Rent reset, occurring on November 1, 2023. As a result of the annual escalator effective November 1, 2019, an additional ROU asset and corresponding lease liability of $34.4 million were recognized associated with operating lease components and an additional ROU asset and corresponding lease liability of $3.1 million were recognized associated with finance lease components. The acquisition of Greektown on May 23, 2019 activated a competition clause within the Penn Master Lease, which introduced a rent floor specific to Toledo. As a result, an additional ROU asset and corresponding lease liability of $151.2 million were recognized associated with operating lease components. Lease payments resulting from the rent floor associated with components determined to continue to be financing obligations are included in “Interest expense, net” within our Consolidated Statements of Income. Monthly rent associated with Columbus and monthly rent in excess of the Toledo rent floor are considered contingent rent. Expense related to operating lease components associated with Columbus and Toledo are included in “General and administrative” within our Consolidated Statements of Income and the variable expense related to the financing obligation component is included in “Interest expense, net” within our Consolidated Statements of Income. The entire variable expense related to prior years was included in “Interest expense, net” pursuant to the failed sale-leaseback accounting treatment under ASC 840. Total monthly variable expenses were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Variable expenses included in “General and administrative” $ 16.4 $ — $ — Variable expenses included in “Interest expense, net” 16.1 48.9 46.8 Total variable expenses $ 32.5 $ 48.9 $ 46.8 Pinnacle Master Lease In connection with the Pinnacle Acquisition, we assumed a triple net master lease with GLPI (the “Pinnacle Master Lease”), originally effective April 28, 2016, pursuant to which the Company leases real estate assets associated with 12 of the gaming facilities used in its operations. Upon assumption of the Pinnacle Master Lease, as amended, there were 7.5 years remaining of the initial ten -year term, with five subsequent, five -year renewal periods, on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 32.5 years . The payment structure under the Pinnacle Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Pinnacle Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues compared to a contractual baseline during the preceding two years (“Pinnacle Percentage Rent”). As a result of the annual escalator, the fixed component of rent increased by $1.0 million effective as of May 1, 2019. The next Pinnacle Percentage Rent reset is scheduled to occur on May 1, 2020. As a result of the annual escalator, an additional ROU asset and corresponding lease liability of $3.8 million were recognized associated with operating lease components of the Pinnacle Master Lease. Operating Leases The Company’s operating leases consist mainly of (i) the Meadows Lease with GLPI, (ii) the Margaritaville Lease with VICI, (iii) the Greektown Lease with VICI, (iv) ground and levee leases to landlords which were not assumed by our REIT Landlords and remain an obligation of the Company, and (v) building and equipment not subject to the Master Leases. Certain of our lease agreements include rental payments based on a percentage of sales over specified contractual amounts, rental payments adjusted periodically for inflation, and rental payments based on usage. The Company’s leases include options to extend the lease terms. The Company’s operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. Meadows Lease, Margaritaville Lease, and Greektown Lease In connection with the Pinnacle Acquisition, we assumed the Meadows Lease, originally effective September 9, 2016. Upon assumption of the Meadows Lease, there were eight years remaining of the initial ten -year term, with three subsequent, five -year renewal options followed by one four -year renewal option on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Meadows Lease includes a fixed component (“Meadows Base Rent”), which is subject to an annual escalator of up to 5% for the initial term or until the lease year in which Meadows Base Rent plus Meadows Percentage Rent (as defined below) is a total of $31.0 million , subject to certain adjustments, and up to 2% thereafter, subject to an Adjusted Revenue to Rent Ratio (as defined in the Meadows Lease) of 2.0 :1. The “Meadows Percentage Rent” is based on performance, which is prospectively adjusted for the next two -year period equal to 4.0% of the average annual net revenues of the property during the trailing two -year period. As a result of the annual escalator, which was determined to be $0.8 million , effective October 1, 2019, an additional operating ROU asset and corresponding operating lease liability of $4.3 million were recognized. The next Meadows Percentage Rent reset is scheduled to occur on October 1, 2020. The Margaritaville Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Margaritaville Lease includes a fixed component (“Margaritaville Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Margaritaville Lease) of 1.9 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Margaritaville Percentage Rent”). The first Margaritaville Percentage Rent reset is scheduled to occur on February 1, 2021. On February 1, 2020, the Margaritaville Lease was amended to provide for a change in the measurement of the annual escalator. Under the amendment, the Margaritaville Base Rent is subject to an annual escalator of up to 2% subject to a minimum ratio of net revenue to rent of 6.1 :1. The Greektown Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Greektown Lease includes a fixed component (“Greektown Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Greektown Lease) of 1.85 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Greektown Percentage Rent”). The first Greektown Percentage Rent reset is scheduled to occur on June 1, 2021. Information related to lease term and discount rate was as follows: December 31, 2019 Weighted-Average Remaining Lease Term Operating leases 27.6 years Finance leases 28.6 years Financing obligations 30.4 years Weighted-Average Discount Rate Operating leases 6.7 % Finance leases 6.8 % Financing obligations 8.1 % The components of lease expense were as follows: Classification (in millions) Gaming Expense Food, Beverage, Hotel and Other Expense General and Administrative Interest Expense, net Depreciation and Amortization Total for the year ended December 31, 2019 Operating Lease Costs Rent expense associated with triple net leases classified as operating leases (1) $ — $ — $ 366.4 $ — $ — $ 366.4 Operating lease cost (2) 0.4 0.5 16.6 — — 17.5 Short-term lease cost 53.8 1.3 1.5 — — 56.6 Variable lease cost (2) 2.8 — 1.1 — — 3.9 Total $ 57.0 $ 1.8 $ 385.6 $ — $ — $ 444.4 Finance Lease Costs Interest expense (3) $ — $ — $ — $ 15.4 $ — $ 15.4 Amortization expense (3) — — — — 7.9 7.9 Total $ — $ — $ — $ 15.4 $ 7.9 $ 23.3 Financing Obligation Costs Interest expense (4) $ — $ — $ — $ 394.1 $ — $ 394.1 (1) Pertains to the components contained within the Master Leases (primarily land) determined to be operating leases, the Meadows Lease, the Margaritaville Lease, and the Greektown Lease, inclusive of the variable expense associated with Columbus and Toledo for the operating lease components (the land) (see table above). (2) Excludes the operating lease costs and variable lease costs pertaining to our triple net leases with our REIT landlords classified as operating leases, discussed in footnote (1) above. (3) Primarily pertains to the Dayton and Mahoning Valley finance leases. (4) Pertains to the components contained within the Master Leases (primarily buildings) determined to continue to be financing obligations, inclusive of the variable expense associated with Columbus and Toledo for the finance lease components (the buildings) (see table above). Total rent expense under all operating lease agreements pursuant to the accounting treatment under ASC 840 was $58.1 million and $45.4 million for the years ended December 31, 2018 and 2017, respectively. Supplemental cash flow information related to leases was as follows: (in millions) For the year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 15.4 Operating cash flows from operating leases $ 403.6 Financing cash flows from finance leases $ 6.2 The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 During the year ended December 31, 2019 , total payments made under the Triple Net Leases were $869.8 million . During the year ended December 31, 2018 , total payments made under the Master Leases and Meadows Lease were $537.4 million . During the year ended December 31, 2017, total payments made under the Penn Master Lease were $455.4 million . Lessor The Company leases its hotel rooms to patrons and records the corresponding lessor revenue in “Food, beverage, hotel and other revenues” within our Consolidated Statements of Income. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized $311.0 million , $163.6 million , and $129.9 million , of lessor revenues related to the rental of hotel rooms, respectively. Hotel leasing arrangements vary in duration, but are short-term in nature. The cost and accumulated depreciation of property and equipment associated with hotel rooms is included in “Property and equipment, net” within our Consolidated Balance Sheets. |
Leases | Note 11—Leases Lessee Master Leases Upon adoption of the new lease standard, components contained within the Master Leases were determined to be either (i) operating leases, (ii) finance leases, or (iii) financing obligations. Changes to future lease payments under the Master Leases (i.e., when future escalators become known or future variable rent resets occur), which are discussed below, require the Company to either (i) increase both the ROU assets and corresponding lease liabilities with respect to operating and finance leases or (ii) record the incremental variable payment associated with the financing obligation to interest expense. Penn Master Lease Pursuant to a triple net master lease with GLPI (the “Penn Master Lease”), which became effective November 1, 2013, the Company leases real estate assets associated with 19 of the gaming facilities used in its operations. The Penn Master Lease has an initial term of 15 years with four subsequent, five -year renewal periods on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 35 years . The payment structure under the Penn Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Penn Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted (i) every five years by an amount equal to 4% of the average change in net revenues of all properties under the Penn Master Lease (other than Hollywood Casino Columbus (“Columbus”) and Hollywood Casino Toledo (“Toledo”)) compared to a contractual baseline during the preceding five years (“Penn Percentage Rent”) and (ii) monthly by an amount equal to 20% of the net revenues of Columbus and Toledo in excess of a contractual baseline and subject to a rent floor specific to Toledo (see below). As a result of the annual escalator, the fixed component of rent increased by $5.5 million , $5.4 million and $2.4 million effective as of November 1, 2019 , 2018 and 2017 , respectively. Additionally, effective November 1, 2018, the Penn Percentage Rent reset resulted in an annual rent reduction of $11.3 million , which will be in effect until the next Penn Percentage Rent reset, occurring on November 1, 2023. As a result of the annual escalator effective November 1, 2019, an additional ROU asset and corresponding lease liability of $34.4 million were recognized associated with operating lease components and an additional ROU asset and corresponding lease liability of $3.1 million were recognized associated with finance lease components. The acquisition of Greektown on May 23, 2019 activated a competition clause within the Penn Master Lease, which introduced a rent floor specific to Toledo. As a result, an additional ROU asset and corresponding lease liability of $151.2 million were recognized associated with operating lease components. Lease payments resulting from the rent floor associated with components determined to continue to be financing obligations are included in “Interest expense, net” within our Consolidated Statements of Income. Monthly rent associated with Columbus and monthly rent in excess of the Toledo rent floor are considered contingent rent. Expense related to operating lease components associated with Columbus and Toledo are included in “General and administrative” within our Consolidated Statements of Income and the variable expense related to the financing obligation component is included in “Interest expense, net” within our Consolidated Statements of Income. The entire variable expense related to prior years was included in “Interest expense, net” pursuant to the failed sale-leaseback accounting treatment under ASC 840. Total monthly variable expenses were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Variable expenses included in “General and administrative” $ 16.4 $ — $ — Variable expenses included in “Interest expense, net” 16.1 48.9 46.8 Total variable expenses $ 32.5 $ 48.9 $ 46.8 Pinnacle Master Lease In connection with the Pinnacle Acquisition, we assumed a triple net master lease with GLPI (the “Pinnacle Master Lease”), originally effective April 28, 2016, pursuant to which the Company leases real estate assets associated with 12 of the gaming facilities used in its operations. Upon assumption of the Pinnacle Master Lease, as amended, there were 7.5 years remaining of the initial ten -year term, with five subsequent, five -year renewal periods, on the same terms and conditions, exercisable at the Company’s option. The Company has determined that the lease term is 32.5 years . The payment structure under the Pinnacle Master Lease includes a fixed component, a portion of which is subject to an annual escalator of up to 2% , depending on the Adjusted Revenue to Rent Ratio (as defined in the Pinnacle Master Lease) of 1.8 :1, and a component that is based on the performance of the properties, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues compared to a contractual baseline during the preceding two years (“Pinnacle Percentage Rent”). As a result of the annual escalator, the fixed component of rent increased by $1.0 million effective as of May 1, 2019. The next Pinnacle Percentage Rent reset is scheduled to occur on May 1, 2020. As a result of the annual escalator, an additional ROU asset and corresponding lease liability of $3.8 million were recognized associated with operating lease components of the Pinnacle Master Lease. Operating Leases The Company’s operating leases consist mainly of (i) the Meadows Lease with GLPI, (ii) the Margaritaville Lease with VICI, (iii) the Greektown Lease with VICI, (iv) ground and levee leases to landlords which were not assumed by our REIT Landlords and remain an obligation of the Company, and (v) building and equipment not subject to the Master Leases. Certain of our lease agreements include rental payments based on a percentage of sales over specified contractual amounts, rental payments adjusted periodically for inflation, and rental payments based on usage. The Company’s leases include options to extend the lease terms. The Company’s operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. Meadows Lease, Margaritaville Lease, and Greektown Lease In connection with the Pinnacle Acquisition, we assumed the Meadows Lease, originally effective September 9, 2016. Upon assumption of the Meadows Lease, there were eight years remaining of the initial ten -year term, with three subsequent, five -year renewal options followed by one four -year renewal option on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Meadows Lease includes a fixed component (“Meadows Base Rent”), which is subject to an annual escalator of up to 5% for the initial term or until the lease year in which Meadows Base Rent plus Meadows Percentage Rent (as defined below) is a total of $31.0 million , subject to certain adjustments, and up to 2% thereafter, subject to an Adjusted Revenue to Rent Ratio (as defined in the Meadows Lease) of 2.0 :1. The “Meadows Percentage Rent” is based on performance, which is prospectively adjusted for the next two -year period equal to 4.0% of the average annual net revenues of the property during the trailing two -year period. As a result of the annual escalator, which was determined to be $0.8 million , effective October 1, 2019, an additional operating ROU asset and corresponding operating lease liability of $4.3 million were recognized. The next Meadows Percentage Rent reset is scheduled to occur on October 1, 2020. The Margaritaville Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Margaritaville Lease includes a fixed component (“Margaritaville Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Margaritaville Lease) of 1.9 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Margaritaville Percentage Rent”). The first Margaritaville Percentage Rent reset is scheduled to occur on February 1, 2021. On February 1, 2020, the Margaritaville Lease was amended to provide for a change in the measurement of the annual escalator. Under the amendment, the Margaritaville Base Rent is subject to an annual escalator of up to 2% subject to a minimum ratio of net revenue to rent of 6.1 :1. The Greektown Lease has an initial term of 15 years , with four subsequent five -year renewal options on the same terms and conditions, exercisable at the Company’s option. The payment structure under the Greektown Lease includes a fixed component (“Greektown Base Rent”), which is subject to an annual escalator of up to 2% subject to an Adjusted Revenue to Rent Ratio (as defined in the Greektown Lease) of 1.85 :1, and a component that is based on performance, which is prospectively adjusted every two years by an amount equal to 4% of the average change in net revenues of the property compared to a contractual baseline during the preceding two years (“Greektown Percentage Rent”). The first Greektown Percentage Rent reset is scheduled to occur on June 1, 2021. Information related to lease term and discount rate was as follows: December 31, 2019 Weighted-Average Remaining Lease Term Operating leases 27.6 years Finance leases 28.6 years Financing obligations 30.4 years Weighted-Average Discount Rate Operating leases 6.7 % Finance leases 6.8 % Financing obligations 8.1 % The components of lease expense were as follows: Classification (in millions) Gaming Expense Food, Beverage, Hotel and Other Expense General and Administrative Interest Expense, net Depreciation and Amortization Total for the year ended December 31, 2019 Operating Lease Costs Rent expense associated with triple net leases classified as operating leases (1) $ — $ — $ 366.4 $ — $ — $ 366.4 Operating lease cost (2) 0.4 0.5 16.6 — — 17.5 Short-term lease cost 53.8 1.3 1.5 — — 56.6 Variable lease cost (2) 2.8 — 1.1 — — 3.9 Total $ 57.0 $ 1.8 $ 385.6 $ — $ — $ 444.4 Finance Lease Costs Interest expense (3) $ — $ — $ — $ 15.4 $ — $ 15.4 Amortization expense (3) — — — — 7.9 7.9 Total $ — $ — $ — $ 15.4 $ 7.9 $ 23.3 Financing Obligation Costs Interest expense (4) $ — $ — $ — $ 394.1 $ — $ 394.1 (1) Pertains to the components contained within the Master Leases (primarily land) determined to be operating leases, the Meadows Lease, the Margaritaville Lease, and the Greektown Lease, inclusive of the variable expense associated with Columbus and Toledo for the operating lease components (the land) (see table above). (2) Excludes the operating lease costs and variable lease costs pertaining to our triple net leases with our REIT landlords classified as operating leases, discussed in footnote (1) above. (3) Primarily pertains to the Dayton and Mahoning Valley finance leases. (4) Pertains to the components contained within the Master Leases (primarily buildings) determined to continue to be financing obligations, inclusive of the variable expense associated with Columbus and Toledo for the finance lease components (the buildings) (see table above). Total rent expense under all operating lease agreements pursuant to the accounting treatment under ASC 840 was $58.1 million and $45.4 million for the years ended December 31, 2018 and 2017, respectively. Supplemental cash flow information related to leases was as follows: (in millions) For the year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 15.4 Operating cash flows from operating leases $ 403.6 Financing cash flows from finance leases $ 6.2 The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 During the year ended December 31, 2019 , total payments made under the Triple Net Leases were $869.8 million . During the year ended December 31, 2018 , total payments made under the Master Leases and Meadows Lease were $537.4 million . During the year ended December 31, 2017, total payments made under the Penn Master Lease were $455.4 million . Lessor The Company leases its hotel rooms to patrons and records the corresponding lessor revenue in “Food, beverage, hotel and other revenues” within our Consolidated Statements of Income. For the years ended December 31, 2019 , 2018 , and 2017 , the Company recognized $311.0 million , $163.6 million , and $129.9 million , of lessor revenues related to the rental of hotel rooms, respectively. Hotel leasing arrangements vary in duration, but are short-term in nature. The cost and accumulated depreciation of property and equipment associated with hotel rooms is included in “Property and equipment, net” within our Consolidated Balance Sheets. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12—Commitments and Contingencies Litigation The Company is subject to various legal and administrative proceedings relating to personal injuries, employment matters, commercial transactions, development agreements and other matters arising in the ordinary course of business. Although the Company maintains what it believes is adequate insurance coverage to mitigate the risk of loss pertaining to covered matters, legal and administrative proceedings can be costly, time-consuming and unpredictable. The Company believes that it has meritorious defenses, claims and/or counter-claims with respect to these proceedings, and intends to vigorously defend itself or pursue its claims. Although no assurance can be given, the Company does not believe that the final outcome of these matters, including costs to defend itself in such matters, will have a material adverse effect on the Company’s Consolidated Financial Statements. Further, no assurance can be given that the amount or scope of existing insurance coverage will be sufficient to cover losses arising from such matters. Location Share Agreements Prairie State Gaming (“PSG”) enters into location share agreements with bar and retail establishments in Illinois. These agreements are contracts which allow PSG to place VGTs in the bar or retail establishment in exchange for a percentage of the variable revenue generated by the VGTs. PSG holds the gaming license with the state of Illinois and the location share percentage is determined by the state of Illinois. For the years ended December 31, 2019 , 2018 and 2017 , the total location share payments made by PSG, which are recorded within our Consolidated Statements of Income as gaming expenses, were $33.1 million , $34.7 million , and $29.7 million , respectively. Purchase Obligations The Company has obligations to purchase various goods and services totaling $126.4 million as of December 31, 2019 , of which $70.4 million will be incurred in 2020 . Capital Expenditure Commitments Pursuant to each of our Triple Net Leases, we are obligated to spend a minimum of 1% of annual net revenues, in the aggregate under each lease, on the maintenance of such facilities. Employee Benefit Plans The Company maintains a qualified retirement plan under the provisions of Section 401(k) of the Internal Revenue Code of 1986, as amended, which covers all eligible employees (the “Penn 401(k) Plan”). The Penn 401(k) Plan enables participating employees to defer a portion of their salary in a retirement fund to be administered by the Company. The Company makes a discretionary match contribution, where applicable, of 50% of employees’ elective salary deferrals, up to a maximum of 6% of eligible employee compensation. The matching contributions to the Penn 401(k) Plan for the years ended December 31, 2019 , 2018 and 2017 were $11.7 million , $6.5 million , and $6.0 million , respectively. We maintain a non-qualified deferred compensation plan (the “EDC Plan”) that covers most management and other highly-compensated employees. The EDC Plan was effective beginning March 1, 2001. The EDC Plan allows the participants to defer, on a pre-tax basis, a portion of their base annual salary and/or their annual bonus and earn tax-deferred earnings on these deferrals. The EDC Plan also provides for matching Company contributions that vest over a five -year period. The Company has established a trust, and transfers to the trust, on a periodic basis, an amount necessary to provide for its respective future liabilities with respect to participant deferral and Company contribution amounts. The Company’s matching contributions for the EDC Plan for the years ended December 31, 2019 , 2018 and 2017 were $2.3 million , $2.3 million , and $2.2 million , respectively. Our deferred compensation liability, which is included in “Accrued expenses and other current liabilities” within the Consolidated Balance Sheets, was $80.1 million and $64.1 million as of December 31, 2019 and 2018 , respectively. Labor Agreements We are required to have agreements with the horsemen at the majority of our racetracks to conduct our live racing and/or simulcasting activities. In addition, in order to operate gaming machines and table games in West Virginia, the Company must maintain agreements with each of the Charles Town horsemen, pari-mutuel clerks and breeders. As of December 31, 2019 , we had 31 collective bargaining agreements covering approximately 5,900 employees. Seven collective bargaining agreements are scheduled to expire in 2020, and we are currently renegotiating three collective bargaining agreements that expired in 2019. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 13—Income Taxes The following table summarizes the tax effects of temporary differences between the Consolidated Financial Statements carrying amount of assets and liabilities and their respective tax basis, which are recorded at the prevailing enacted tax rate that will be in effect when these differences are settled or realized. These temporary differences result in taxable or deductible amounts in future years. The Company assessed all available positive and negative evidence to estimate whether sufficient future taxable income will be generated to realize our existing net deferred tax assets. The components of the Company’s deferred tax assets and liabilities were as follows: December 31, (in millions) 2019 2018 Deferred tax assets: Stock-based compensation expense $ 11.7 $ 9.0 Accrued expenses 37.6 42.9 Financing obligations associated with the Master Leases 1,097.6 1,919.7 Unrecognized tax benefits 7.7 6.7 Investments in and advances to unconsolidated affiliates — 3.6 Net operating losses, interest limitation and tax credit carryforwards 87.6 122.8 Gross deferred tax assets 1,242.2 2,104.7 Less: Valuation allowance (54.2 ) (89.5 ) Net deferred tax assets 1,188.0 2,015.2 Deferred tax liabilities: Property and equipment, not subject to the Master Leases (53.1 ) (47.3 ) Property and equipment, subject to the Master Leases (1,088.9 ) (1,599.9 ) Investments in and advances to unconsolidated affiliates (2.9 ) — Undistributed foreign earnings (0.4 ) (0.4 ) Intangible assets (287.3 ) (287.0 ) Net deferred tax liabilities (1,432.6 ) (1,934.6 ) Long-term deferred tax assets (liabilities), net $ (244.6 ) $ 80.6 Upon adoption of the new lease standard on January 1, 2019, we recorded a $739.2 million decrease in net deferred tax assets associated with our financing obligations and $435.4 million decrease in net deferred tax liabilities associated with property and equipment that is subject to our Master Leases. The net amount of these two adjustments was recorded as a decrease to stockholders’ equity (see Note 3, “New Accounting Pronouncements” ). The realizability of the net deferred tax assets is evaluated quarterly by assessing the need for a valuation allowance and by adjusting the amount of the allowance, if necessary. The Company gives appropriate consideration to all available positive and negative evidence including projected future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. The evaluation of both positive and negative evidence is a requirement pursuant to ASC 740 in determining the net deferred tax assets will be realized. In the event the Company determines that the deferred income tax assets would be realized in the future in excess of their net recorded amount, an adjustment to the valuation allowance would be recorded, which would reduce the provision for income taxes. As of December 31, 2019 , the Company has significant three-year cumulative pretax income of $150.9 million , supporting the position that a federal valuation allowance is not necessary except for the valuation allowance recorded on federal capital loss carryforwards. The Company continues to maintain a valuation allowance of $54.2 million as of December 31, 2019 primarily related to certain state filing groups where we continue to be in a three-year cumulative pretax loss position. During the year ended December 31, 2018, we released a partial valuation allowance on a capital loss carryforward in the amount of $22.4 million that offset the capital gain realized on the Plainridge Park Casino Sale-Leaseback. This reversal is reflected in our income tax benefit within the Consolidated Statements of Income. During the third quarter of 2017, we determined that a valuation allowance was no longer required against our federal and state net deferred tax assets for the portion that will be realized. The most significant evidence that led to the reversal of our valuation allowance as of the aforementioned period included, (i) the achievement and sustained growth in our three-year cumulative pretax earnings, (ii) substantial pretax income in seven of the last eight quarters with the only loss reported eight quarters ago, and (iii) the lack of significant goodwill and other intangible asset impairment losses expected in 2017. During the fourth quarter of 2017, there were no material changes to our core business operations that altered our prior interim conclusion to release the valuation allowance against the federal and state net deferred tax assets for the portion that is more-likely-than-not to be realized. As such, we released $741.9 million of our total valuation allowance for the year ended December 31, 2017 due to the positive evidence outweighing the negative evidence thereby allowing us to achieve the more-likely-than-not realization standard. Overall, our valuation allowance decreased year-over-year by a net amount of $35.3 million , primarily due to the adoption of the new lease standard as of January 1, 2019, and was recorded as an increase to stockholders’ equity. The impact of the new lease standard was partially offset by an increase in the valuation allowance for state net operating loss carryforwards. Following the ownership changes of the Tropicana Las Vegas, the Company has $120.3 million of total gross federal net operating loss carryforwards that will expire on various dates from 2020 through 2035. The Company acquired federal net operating loss carryforwards from the Pinnacle Acquisition, which were fully utilized as of December 31, 2019 . All acquired tax attributes are subject to limitations under the Internal Revenue Code and underlying Treasury Regulations, however, we believe it is more-likely-than-not that the benefit from these tax attributes will be realized. For state income tax reporting, as of December 31, 2019 , we had gross state net operating loss carryforwards aggregating $766.2 million available to reduce future state income taxes, primarily for the Commonwealth of Pennsylvania and the States of Colorado, Iowa, Louisiana, Missouri, New Mexico and Ohio localities. The tax benefit associated with these net operating loss carryforwards was $52.2 million . Due to statutorily limited operating loss carryforwards and income and loss projections in the applicable jurisdictions, a valuation allowance has been recorded to reflect the net operating losses which are not presently expected to be realized in the amount of $36.4 million . If not used, substantially all the carryforwards will expire at various dates from December 31, 2020 through December 31, 2039. The domestic and foreign components of income (loss) before income taxes for the years ended December 31, 2019 , 2018 and 2017 were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Domestic $ 85.5 $ 89.6 $ (29.6 ) Foreign 0.6 0.3 4.5 Total $ 86.1 $ 89.9 $ (25.1 ) The components of income tax benefit (expense) for the years ended December 31, 2019 , 2018 and 2017 were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Current tax benefit (expense) Federal $ (12.5 ) $ (15.3 ) $ (16.3 ) State (9.2 ) (6.4 ) (6.1 ) Foreign (0.2 ) (1.4 ) 3.0 Total current (21.9 ) (23.1 ) (19.4 ) Deferred tax benefit (expense) Federal (16.7 ) 14.6 480.7 State (4.4 ) 10.9 39.3 Foreign — 1.2 (2.1 ) Total deferred (21.1 ) 26.7 517.9 Total income tax benefit (expense) $ (43.0 ) $ 3.6 $ 498.5 On December 22, 2017, the President of the United States signed into law comprehensive tax reform legislation commonly known as Tax Cuts and Jobs Act (the “Tax Act”), which most notably, reduced the U.S. federal corporate tax rate from 35% to 21% effective January 1, 2018. For the year ended December 31, 2017, we recorded a provisional amount for certain enactment-date effects of the Tax Act, resulting in a net charge of $266.0 million included as income tax expense within the Consolidated Statements of Income consisting of three components: (i) a $261.3 million charge due to the revaluation of the net deferred tax assets in the U.S. based on the new lower federal income tax rate, (ii) a $2.6 million charge related to the one-time mandatory repatriation tax on previously deferred earnings from our wholly-owned Canadian subsidiary (which we will pay interest-free over eight years) and (iii) a $2.1 million foreign withholding tax charge due to the new favorable U.S. treatment of foreign dividends whereby we have changed our indefinite reinvestment assertion. During the year ended December 31, 2018, we finalized our assessment of the effects of the Tax Act, resulting in a $1.2 million increase to the provisional amount, which increased the effective tax rate by 1.3% . The following table reconciles the statutory federal income tax rate to the actual effective income tax rate, and related amounts of income tax benefit (expense), for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, 2019 2018 2017 (in millions, except tax rates) Percent Amount Percent Amount Percent Amount Percent and amount of pretax income Federal statutory rate 21.0 % $ (18.1 ) 21.0 % $ (18.9 ) 35.0 % $ 8.8 State and local income taxes, net of federal benefits 9.9 (8.5 ) (6.2 ) 5.6 6.3 1.6 Nondeductible expenses 4.0 (3.5 ) 6.9 (6.2 ) (16.0 ) (4.0 ) Goodwill impairment losses 14.4 (12.4 ) — — (20.5 ) (5.1 ) Compensation 0.3 (0.3 ) (3.8 ) 3.4 29.5 7.4 Contingent liability settlement — — — — 22.9 5.7 Foreign 0.1 (0.1 ) (0.1 ) 0.1 11.3 2.8 Valuation allowance — — (20.3 ) 18.3 2,962.3 741.9 Tax Act - deferred rate change — — — — (1,043.5 ) (261.3 ) Other 0.2 (0.1 ) (1.5 ) 1.3 3.3 0.7 Total effective tax rate and income tax benefit (expense) 49.9 % $ (43.0 ) (4.0 )% $ 3.6 1,990.6 % $ 498.5 A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows: (in millions) Unrecognized tax benefits Unrecognized tax benefits as of January 1, 2017 $ 26.8 Additions based on current year positions 2.9 Additions based on prior year positions 2.8 Decreases due to settlements and/or reduction in reserves (1.3 ) Currency translation adjustments (0.1 ) Settlement payments (0.2 ) Unrecognized tax benefits as of December 31, 2017 30.9 Additions based on prior year positions 0.8 Decreases due to settlements and/or reduction in reserves (2.0 ) Unrecognized tax benefits as of December 31, 2018 29.7 Additions based on prior year positions 6.5 Decreases due to settlements and/or reduction in reserves (0.2 ) Unrecognized tax benefits as of December 31, 2019 $ 36.0 During the year ended December 31, 2019 , we did no t record any new tax reserves, and accrued interest or penalties related to current year uncertain tax positions. Regarding prior year tax positions, we recorded $7.1 million of tax reserves and accrued interest and reversed $0.2 million of previously recorded tax reserves and accrued interest for uncertain tax positions that are anticipated to settle and/or close within the next 12 months. As of December 31, 2019 and 2018 , unrecognized tax benefits, inclusive of accruals for income tax related penalties and interest, of $37.2 million and $30.4 million , respectively, were included in “Other long-term liabilities” within the Company’s Consolidated Balance Sheets. Overall, the Company recorded a net tax expense of $2.8 million in connection with its uncertain tax positions for the year ended December 31, 2019. The liability for unrecognized tax benefits as of December 31, 2019 and 2018 included $29.4 million and $23.6 million , respectively, of tax positions that, if reversed, would affect the effective tax rate. During the years ended December 31, 2019 , 2018 and 2017 , we recognized $0.1 million , $0.5 million and $1.7 million , respectively, of interest and penalties, net of deferred taxes. The Company had no reductions in previously accrued interest and penalties for the year ended December 31, 2019. We classify any income tax related penalties and interest accrued related to unrecognized tax benefits in “Income tax benefit (expense)” within the Consolidated Statements of Income. The Company is currently in various stages of the examination process in connection with its open audits. Generally, it is difficult to determine when these examinations will be closed, but the Company reasonably expects that its ASC 740 liabilities will not significantly change over the next twelve months. As of December 31, 2019 , the Company is subject to U.S. federal income tax examinations for the tax years 2015 , 2016 , 2017 and 2018 . In addition, we are subject to state and local income tax examinations for various tax years in the taxing jurisdictions in which we operate. As of December 31, 2019 and 2018 , prepaid income taxes of $22.2 million and $14.9 million , respectively, were included in “Prepaid expenses” within the Company’s Consolidated Balance Sheets. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Note 14—Stockholders’ Equity Share Repurchase Program On January 9, 2019, the Company announced a share repurchase program pursuant to which the Board of Directors authorized to repurchase up to $200.0 million of the Company’s common stock, which expires on December 31, 2020. During the year ended December 31, 2019, the Company repurchased 1,271,823 shares of its common stock in open market transactions for $24.9 million at an average price of $19.55 per share. All repurchased shares were retired. On February 3, 2017, the Company announced a share repurchase program pursuant to which the Board of Directors authorized to repurchase up to $100.0 million of the Company’s common stock, which expired on February 1, 2019. During the years ended December 31, 2018 and 2017 , the Company repurchased 2,299,498 and 1,264,149 shares, respectively, of its common stock in open market transactions for $50.0 million at an average price of $21.74 per share and $24.8 million at an average price of $19.59 per share, respectively. All repurchased shares were retired. Preferred Stock The Company previously issued two series of preferred stock, Series B and Series C, each with a par value of $0.01 per share. As of December 31, 2019 and 2018 , there were 1,000,000 and 18,500 shares authorized of our Series B and Series C preferred stock, respectively. There were no shares outstanding of either Series B or Series C preferred stock as of December 31, 2019 and 2018 . |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 15—Stock-Based Compensation 2018 Long Term Incentive Compensation Plan In June 2018, the Company’s shareholders approved the 2018 Long Term Incentive Compensation Plan (the “2018 Plan”), which permits the Company to issue stock options (incentive and/or non-qualified), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), phantom stock units (“PSUs”) and other equity and cash awards to employees. Non-employee directors are eligible to receive all such awards, other than incentive stock options. Pursuant to the 2018 Plan, 12,700,000 shares of the Company’s common stock are reserved for issuance. For purposes of determining the number of shares available for issuance under the 2018 Plan, stock options and SARs count against the 12,700,000 limit as one share of common stock for each share granted and restricted stock or any other full value stock award count as issuing 2.30 shares of common stock for each share granted. Any awards that are not settled in shares of common stock are not counted against the limit. As of December 31, 2019 , there were 8,417,411 shares available for future grants under the 2018 Plan. 2008 Long Term Incentive Compensation Plan In November 2008, the Company’s shareholders approved the 2008 Long Term Incentive Compensation Plan (the “2008 Plan”), which permitted the Company to issue stock options (incentive and/or non-qualified), SARs, RSAs, PSUs and other equity and cash awards to employees. Non-employee directors were eligible to receive all such awards, other than incentive stock options. Upon approval of the 2018 Plan, awards were no longer available to be granted under the 2008 Plan. However, the 2008 Plan remains in place until all of the awards previously granted thereunder have been paid, forfeited or expired. Stock-based Compensation Expense Stock-based compensation expense, which pertains principally to our stock options and RSAs, for the years ended December 31, 2019 , 2018 and 2017 totaled $14.9 million , $12.0 million and $7.8 million , respectively, and is included within the Consolidated Statements of Income under “General and administrative.” Stock Options Stock options that expire between April 1, 2020 and October 1, 2029 have been granted to officers, directors, employees, and predecessor employees to purchase common stock at prices ranging from $11.61 to $32.90 per share. All options were granted at the fair market value of the common stock on the grant date (as defined in the respective plan document) and have contractual lives ranging from two to ten years . The Company issues new authorized common shares to satisfy stock option exercises. The following table contains information about our stock options: Number of Option Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in millions) Outstanding as of January 1, 2019 5,869,211 $ 15.14 Granted 2,436,811 $ 19.24 Exercised (230,644 ) $ 14.32 Forfeited (257,942 ) $ 19.44 Outstanding as of December 31, 2019 7,817,436 $ 16.30 4.84 $ 75.1 Exercisable as of December 31, 2019 4,071,052 $ 13.62 2.49 $ 49.2 The weighted-average grant-date fair value of options granted during the years ended December 31, 2019 , 2018 and 2017 was $6.39 , $9.88 and $4.48 , respectively. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2019 , 2018 and 2017 was $2.0 million , $28.7 million and $15.8 million , respectively. The total fair value of stock options that vested during the years ended December 31, 2019 , 2018 and 2017 was $6.2 million , $5.9 million and $6.4 million , respectively. The following table summarizes information about our outstanding stock options as of December 31, 2019 : Exercise Price Range Total $11.61 to $17.77 to $30.74 to $11.61 to Outstanding options Number outstanding 4,842,725 2,368,886 605,825 7,817,436 Weighted-average remaining contractual term (in years) 2.66 9.27 4.95 4.84 Weighted-average exercise price $ 13.06 $ 19.23 $ 30.75 $ 16.30 Exercisable options Number outstanding 3,901,333 10,584 159,135 4,071,052 Weighted-average exercise price $ 12.91 $ 18.62 $ 30.75 $ 13.62 As of December 31, 2019 , the unamortized compensation costs not yet recognized related to stock options granted totaled $16.9 million and the weighted-average period over which the costs are expected to be recognized was 2.9 years . The following are the weighted-average assumptions used in the Black-Scholes option-pricing model for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, 2019 2018 2017 Risk-free interest rate 2.00 % 2.26 % 1.97 % Expected volatility 32.90 % 30.80 % 30.66 % Dividend yield — — — Weighted-average expected life (in years) 5.30 5.30 5.30 Restricted Stock Awards As noted above, the Company grants RSAs to our employees and certain non-employee directors. In addition, the Company issues its named executive officers (“NEOs”) and other key executives RSAs with performance conditions (we refer to our RSAs with performance conditions as “PSAs”), which are discussed in further detail below. Performance Share Programs The Company’s Performance Share Programs (as defined below) were adopted in order to provide our NEOs and certain other key executives with stock-based compensation tied directly to the Company’s performance, which further aligns their interests with those of shareholders and provides compensation only if the designated performance goals are met for the applicable performance periods. On February 14, 2019, the Company’s Compensation Committee of the Board of Directors adopted a performance share program (the “Performance Share Program II”) pursuant to the 2018 Plan, which, for awards made in 2019, provided for the issuance of 278,780 PSAs, at target, to be granted in one-third increments. On February 6, 2018, our Compensation Committee adopted a performance share program (the “2018 Performance Share Program”) pursuant to the 2018 Plan, which provided for the issuance of 197,727 PSAs, at target, to be granted in one-third increments. On February 9, 2016, our Compensation Committee adopted a performance share program (the “2016 Performance Share Program” and collectively with the Performance Share Program II and the 2018 Performance Share Program, the “Performance Share Programs”) pursuant to the 2008 Plan, which provided for the issuance of 189,085 PSAs, at target, to be granted in one-third increments. In addition, the 2016 Performance Share Program provided for the issuance of 172,245 PSAs, at target, on February 17, 2017, to be granted in one-third increments. PSAs issued pursuant to the Performance Share Programs consist of three one -year performance periods over a three -year service period. The awards have the potential to be earned at between 0% and 150% of the number of shares granted depending on achievement of the annual performance goals, but remain subject to vesting for the full three -year service period. The performance goal as it pertains to the first and second performance periods of the awards granted under the Performance Share Program II is based on a combination of EBITDA, adjusted for certain items, principally payments made to our REIT landlords (“EBITDA, as adjusted”); and run-rate cost synergies from the Pinnacle Acquisition. The performance goal for the third performance period is based on EBITDA, as adjusted. The performance goals for each of the one -year performance periods of the awards granted under the 2018 Performance Share Program and 2016 Performance Share Program are based on EBITDA, as adjusted. Awards are not considered granted, for accounting purposes, under the Performance Share Programs until the targets are established and mutually understood by the Company and the individuals receiving the PSAs. The grant date fair value of our RSAs is based on the most recent closing stock price of the Company’s shares of common stock. The stock-based compensation expense is recognized over the remaining service period at the time of grant, adjusted for the Company’s expectation of the achievement of the performance conditions. The following table contains information on our RSAs: With Performance Conditions Without Performance Conditions Number of Shares Weighted- Average Grant Date Fair Value Number of Shares Weighted- Average Grant Date Fair Value Nonvested as of January 1, 2019 351,472 $ 22.10 207,349 $ 25.55 Granted 253,609 $ 23.55 175,795 $ 19.44 Vested (193,799 ) $ 19.36 (35,758 ) $ 18.05 Forfeited (15,920 ) $ 22.60 (48,907 ) $ 23.71 Nonvested as of December 31, 2019 395,362 $ 24.35 298,479 $ 23.15 As of December 31, 2019 , the unamortized compensation costs not yet recognized related to RSAs totaled $7.9 million and the weighted-average period over which the costs are expected to be recognized is 1.9 years . The total fair value of RSAs that vested during the years ended December 31, 2019 , 2018 and 2017 was $5.5 million , $0.9 million and $1.0 million , respectively. Phantom Stock Units Our PSUs, which vest over a period of three to four years , entitle employees and directors to receive cash based on the fair value of the Company’s common stock on the vesting date. The PSUs are accounted for as liability awards and are re-measured at fair value each reporting period until they become vested with compensation expense being recognized over the requisite service period. The Company has a liability, which is included in “Accrued expenses and other current liabilities” within the Consolidated Balance Sheets, associated with its PSUs of $3.3 million and $1.7 million as of December 31, 2019 and 2018 , respectively. For PSUs held by employees and directors of the Company, there was $3.3 million of total unrecognized compensation cost as of December 31, 2019 that will be recognized over the awards remaining weighted-average vesting period of 1.6 years. For the years ended December 31, 2019 , 2018 and 2017 , the Company recognized $4.1 million , $1.1 million , and $11.9 million of compensation expense associated with these awards, respectively. Compensation expense associated with our PSUs is recorded in “General and administrative” within the Consolidated Statements of Income. We paid $2.5 million , $4.2 million , and $12.7 million during the years ended December 31, 2019 , 2018 and 2017 , respectively, pertaining to our cash-settled PSUs. Stock Appreciation Rights The fair value of SARs is calculated each reporting period and estimated using the Black-Scholes option pricing model. Our SARs, which vest over a period of four years , are accounted for as liability awards since they will be settled in cash. Accordingly, the Company has a liability, which is included in “Accrued expenses and other current liabilities” within the Consolidated Balance Sheets, associated with its SARs of $14.4 million and $6.8 million as of December 31, 2019 and 2018 , respectively. For SARs held by employees of the Company, there was $9.6 million of total unrecognized compensation cost as of December 31, 2019 that will be recognized over the awards remaining weighted-average vesting period of 2.6 years. For the year ended December 31, 2019 , the Company recognized compensation expense of $10.7 million as compared to a reduction to compensation expense of $6.7 million and compensation expense of $21.9 million for the years ended December 31, 2018 and 2017 , respectively, associated with these awards. Compensation expense associated with our SARs is recorded in “General and administrative” within the Consolidated Statements of Income. We paid $3.5 million , $10.5 million and $6.2 million during the years ended December 31, 2019 , 2018 and 2017 , respectively, pertaining to our cash-settled SARs. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 16—Earnings per Share The following table reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, (in millions) 2019 2018 2017 Determination of shares: Weighted-average common shares outstanding 115.7 97.1 90.9 Assumed conversion of dilutive stock options 1.8 3.0 2.4 Assumed conversion of dilutive restricted stock awards 0.3 0.2 0.1 Diluted weighted-average common shares outstanding 117.8 100.3 93.4 Options to purchase 2,353,307 , 656,588 , and 51,803 shares were outstanding during the years ended December 31, 2019 , 2018 and 2017 , respectively, but were not included in the computation of diluted EPS because they were antidilutive. The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, (in millions, except per share data) 2019 2018 2017 Calculation of basic EPS: Net income applicable to common stock $ 43.9 $ 93.5 $ 473.4 Weighted-average common shares outstanding 115.7 97.1 90.9 Basic EPS $ 0.38 $ 0.96 $ 5.21 Calculation of diluted EPS: Net income applicable to common stock 43.9 93.5 473.4 Diluted weighted-average common shares outstanding 117.8 100.3 93.4 Diluted EPS $ 0.37 $ 0.93 $ 5.07 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Note 17—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. For the year ended December 31, (in millions) 2019 2018 2017 Revenues: Northeast segment $ 2,399.9 $ 1,891.5 $ 1,756.6 South segment 1,118.9 394.4 224.3 West segment 642.5 437.9 380.4 Midwest segment 1,094.5 823.7 735.0 Other (1) 47.5 40.4 51.7 Intersegment eliminations (2) (1.9 ) — — Total $ 5,301.4 $ 3,587.9 $ 3,148.0 Adjusted EBITDAR (3) : Northeast segment $ 720.8 $ 583.8 $ 549.3 South segment 369.8 118.9 62.6 West segment 198.8 114.3 72.7 Midwest segment 403.6 294.3 249.7 Other (1) (87.8 ) (68.1 ) (55.2 ) Total (3) 1,605.2 1,043.2 879.1 Other operating benefits (costs) and other income (expenses): Rent expense associated with triple net operating leases (4) (366.4 ) (3.8 ) — Stock-based compensation (14.9 ) (12.0 ) (7.8 ) Cash-settled stock-based awards variance (0.8 ) 19.6 (23.4 ) Loss on disposal of assets (5.5 ) (3.2 ) (0.2 ) Contingent purchase price (7.0 ) (0.5 ) 6.8 Pre-opening and acquisition costs (22.3 ) (95.0 ) (9.7 ) Depreciation and amortization (414.2 ) (269.0 ) (267.1 ) Impairment losses (173.1 ) (34.9 ) (18.0 ) Recoveries on (provision for) loan loss and unfunded loan commitments — 17.0 (89.8 ) Insurance recoveries, net of deductible charges 3.0 0.1 0.3 Non-operating items for Kansas JV (3.7 ) (5.1 ) (5.8 ) Interest expense, net (534.2 ) (538.4 ) (463.2 ) Loss on early extinguishment of debt — (21.0 ) (24.0 ) Other 20.0 (7.1 ) (2.3 ) Income before income taxes 86.1 89.9 (25.1 ) Income tax benefit (expense) (43.0 ) 3.6 498.5 Net income $ 43.1 $ 93.5 $ 473.4 (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, and iGaming; 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. (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 charges; 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 (such as depreciation and amortization) added back for our JV in Kansas Entertainment. (4) The Company’s triple net operating leases include certain components of the Master Leases (primarily land), the Meadows Lease, the Margaritaville Lease, and the Greektown Lease. For the year ended December 31, (in millions) 2019 2018 2017 Capital expenditures: Northeast segment $ 96.2 $ 38.9 $ 26.3 South segment 29.8 10.6 6.3 West segment 21.2 12.8 35.7 Midwest segment 32.7 25.3 26.2 Other 10.7 5.0 4.8 Total capital expenditures $ 190.6 $ 92.6 $ 99.3 (in millions) Northeast South West Midwest Other Total As of December 31, 2019 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 90.9 $ 37.3 $ 128.3 Total assets (1) $ 2,273.7 $ 1,397.0 $ 752.1 $ 1,412.2 $ 8,359.5 $ 14,194.5 As of December 31, 2018 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 89.4 $ 39.0 $ 128.5 Total assets (2) $ 1,330.2 $ 1,082.3 $ 755.7 $ 1,411.5 $ 6,381.3 $ 10,961.0 As of December 31, 2017 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 88.3 $ 60.5 $ 148.9 Total assets (2) $ 921.0 $ 169.3 $ 625.0 $ 970.8 $ 2,548.7 $ 5,234.8 (1) As of December 31, 2019 , total assets of the Other category includes the real estate assets subject to the Master Leases, which are either classified as property and equipment, operating lease ROU assets, or finance lease ROU assets, depending on whether the underlying component of the Master Leases was determined to be an operating lease, a finance lease, or continue to be financing obligations, upon adoption of ASC 842. (2) |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 18—Fair Value Measurements ASC Topic 820, “Fair Value Measurements and Disclosures,” establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach and cost approach). The levels of the hierarchy are described below: • Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. • Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals. • Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions, as there is little, if any, related market activity. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate. The fair value of the Company’s trade accounts receivable and payables approximates the carrying amounts. Cash and Cash Equivalents The fair value of the Company’s cash and cash equivalents approximates their carrying amount, due to the short maturity of the cash equivalents. Equity Securities As of December 31, 2019 , we held $40.5 million in equity securities, including ordinary shares and warrants, which are reported as “Other assets” in our Consolidated Balance Sheet. As discussed in Note 2, “Significant Accounting Policies,” these equity securities are the result of Penn Interactive entering into multi-year agreements with third-party sports betting operators for online sports betting and related iGaming market access across our portfolio during the third quarter of 2019. The fair value of the equity securities was determined using Level 2 inputs, which use market approach valuation techniques. The primary inputs to those techniques include the quoted market price of the equity securities, foreign currency exchange rates, a discount for lack of marketability (“DLOM”) with respect to the ordinary shares, and a Black-Scholes option pricing model with respect to the warrants. The DLOM is based on the remaining term of the relevant lock-up periods and the volatility associated with the underlying equity securities. The Black-Scholes option pricing model utilizes the exercise price of the warrants, a risk-free rate, volatility associated with the underlying equity securities and the expected life of the warrants. Held-to-maturity Securities and Promissory Notes We have a management contract with Retama Development Corporation (“RDC”), a local government corporation of the City of Selma, Texas, to manage the day-to-day operations of Retama Park Racetrack, located outside of San Antonio, Texas. In addition, we own 1.0% of the equity of Retama Nominal Holder, LLC, which holds a nominal interest in the racing license used to operate Retama Park Racetrack, and a 75.5% interest in Pinnacle Retama Partners, LLC (“PRP”), which owns the contingent gaming rights that may arise if gaming under the existing racing license becomes legal in Texas in the future. As of December 31, 2019 and 2018 , PRP held $15.1 million and $16.9 million , respectively, in promissory notes issued by RDC and $6.7 million and $7.5 million , respectively, in local government corporation bonds issued by RDC, at amortized cost. The promissory notes and the local government corporation bonds are collateralized by the assets of Retama Park Racetrack. As of December 31, 2019 and 2018 , the promissory notes and the local government corporation bonds, which have long-term contractual maturities, are included in “Other assets” within our Consolidated Balance Sheets. During the year ended December 31, 2019 , principally due to the lack of legislative progress and on-going negative operating results of Retama Park Racetrack, we recorded an other-than-temporary impairment on the promissory notes and the local government corporation bonds totaling $2.5 million , which is included in “Impairment losses” within our Consolidated Statements of Income. The contractual terms of these promissory notes include interest payments due at maturity; however, we have not recorded accrued interest on these promissory notes because uncertainty exists as to RDC’s ability to make interest payments. We have the positive intent and ability to hold the local government corporation bonds to maturity and until the amortized cost is recovered. The estimated fair values of such investments are principally based on appraised values of the land associated with Retama Park Racetrack, which are classified as Level 2 inputs. Long-term Debt The fair value of our Term Loan A Facility, Term Loan B-1 Facility and 5.625% Notes is estimated based on quoted prices in active markets and is classified as a Level 1 measurement. The fair value of our Revolving Credit Facility approximates its carrying amount as it is revolving, variable rate debt, which we also classify as a Level 1 measurement. Other long-term obligations as of December 31, 2019 and 2018 included the relocation fees for Dayton and Mahoning Valley, which are discussed in Note 10, “Long-term Debt,” and the repayment obligation of the hotel and event center located near Hollywood Casino Lawrenceburg. The fair values of these long-term obligations are estimated based on rates consistent with the Company’s credit rating for comparable terms and debt instruments and are classified as Level 2 measurements. Other Liabilities Other liabilities as of December 31, 2019 and 2018 principally consists of contingent purchase price related to Plainridge Park Casino and Absolute Games, LLC, which was acquired by Penn Interactive during the second quarter of 2018. The Plainridge Park Casino contingent purchase price is calculated based on earnings of the gaming operations over the first ten years of operations, which commenced in June 2015. As of December 31, 2019 and 2018 , we were contractually obligated to make six and seven additional annual payments, respectively. The Absolute Games, LLC, contingent purchase price is calculated based on earnings over the first two years of operations after the acquisition. As of December 31, 2019 , we were contractually obligated to make one additional payment, corresponding to the second year of operations after the acquisition, which will become payable in the third quarter of 2020. The fair value of these liabilities, which are both estimated based on an income approach using a DCF model and have been classified as Level 3 measurements, are included within our Consolidated Balance Sheets in “Accrued expenses and other current liabilities” or “Other long-term liabilities,” depending on the timing of the next payment. The carrying amounts and estimated fair values by input level of the Company’s financial instruments were as follows: December 31, 2019 (in millions) Carrying Amount Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 437.4 $ 437.4 $ 437.4 $ — $ — Equity securities $ 40.5 $ 40.5 $ — $ 40.5 $ — Held-to-maturity securities $ 6.7 $ 6.7 $ — $ 6.7 $ — Promissory notes $ 15.1 $ 15.1 $ — $ 15.1 $ — Financial liabilities: Long-term debt Senior Secured Credit Facilities $ 1,896.5 $ 1,930.6 $ 1,930.6 $ — $ — 5.625% Notes $ 399.4 $ 426.0 $ 426.0 $ — $ — Other long-term obligations $ 89.2 $ 89.7 $ — $ 89.7 $ — Other liabilities $ 20.3 $ 20.3 $ — $ 2.8 $ 17.5 December 31, 2018 (in millions) Carrying Amount Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 479.6 $ 479.6 $ 479.6 $ — $ — Held-to-maturity securities $ 7.5 $ 7.9 $ — $ 7.9 $ — Promissory notes $ 16.9 $ 17.4 $ — $ 17.4 $ — Financial liabilities: Long-term debt Senior Secured Credit Facilities $ 1,907.9 $ 1,886.3 $ 1,886.3 $ — $ — 5.625% Notes $ 399.3 $ 360.0 $ 360.0 $ — $ — Other long-term obligations $ 104.6 $ 96.3 $ — $ 96.3 $ — Other liabilities $ 21.9 $ 21.8 $ — $ 2.8 $ 19.0 The following table summarizes the changes in fair value of our Level 3 liabilities measured on a recurring basis: Other Liabilities (in millions) Contingent Purchase Price Balance as of January 1, 2017 $ 48.2 Additions 0.9 Payments (19.6 ) Included in earnings (1) (6.8 ) Balance as of December 31, 2017 22.7 Payments (4.2 ) Included in earnings (1) 0.5 Balance as of December 31, 2018 19.0 Payments (8.5 ) Included in earnings (1) 7.0 Balance as of December 31, 2019 $ 17.5 (1) The expense is included in “General and administrative” within our Consolidated Statements of Income. The following table sets forth the assets measured at fair value on a non-recurring basis during the years ended December 31, 2019 and 2018 : (in millions) Valuation Date Valuation Technique Level 1 Level 2 Level 3 Total Balance Total Reduction in Fair Value Recorded Goodwill 10/1/2019 Discounted cash flow and market approach $ — $ — $ 161.1 $ 161.1 $ (88.0 ) Gaming licenses 10/1/2019 Discounted cash flow $ — $ — $ 290.0 $ 290.0 $ (62.6 ) Trademarks 10/1/2019 Discounted cash flow $ — $ — $ 87.5 $ 87.5 $ (20.0 ) Property and equipment (1) 12/31/2018 Cost and market approach $ — $ — $ — $ — $ (34.3 ) (1) The fair value, which was concluded to be zero, of our property and equipment associated with Resorts Casino Tunica was determined using Level 2 inputs. See Note 7, “Property and Equipment” for more information. The following table summarizes the significant unobservable inputs used in calculating fair value for our Level 3 liabilities on a recurring basis as of December 31, 2019 : Valuation Technique Unobservable Input Discount Rate Plainridge Park Casino contingent purchase price Discounted cash flow Discount rate 5.63% As discussed in Note 8, “Goodwill and Other Intangible Assets,” we recorded impairments on our gaming licenses and trademarks, which are indefinite-lived intangible assets, as a result of our 2019 annual assessment for impairment. The following table presents quantitative information about the significant unobservable inputs used in the fair value measurements of other indefinite-lived intangible assets as of the valuation date below: (in millions) Fair Value Valuation Technique Unobservable Input Range or Amount As of October 1, 2019 Gaming licenses $ 290.0 Discounted cash flow Discount rate 10.5% - 11.25% Long-term revenue growth rate 2.0 % Trademarks $ 87.5 Discounted cash flow Discount rate 10.5% - 11.25% Long-term revenue growth rate 2.0 % Pretax royalty rate 1.0% - 2.0% |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 19—Related Party Transactions The Company currently leases executive office buildings in Wyomissing, Pennsylvania from affiliates of its Chairman Emeritus of the Board of Directors. Rent expense for the years ended December 31, 2019 , 2018 and 2017 was $1.2 million , $1.3 million and $1.2 million , respectively. Certain of the leases for the office space expired in May 2019, but have been extended on a month-to-month basis; the remaining long-term lease for the office space expires in August 2024. The future minimum lease commitments relating to these leases as of December 31, 2019 were $1.8 million . |
Summarized Quarterly Data (Unau
Summarized Quarterly Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Data (Unaudited) | Note 20—Summarized Quarterly Data (Unaudited) The following table summarizes the quarterly results of operations for the years ended December 31, 2019 and 2018 : Fiscal Quarter (in millions, except per share data) First Second Third Fourth (1) 2019 Revenues $ 1,282.6 $ 1,323.1 $ 1,354.5 $ 1,341.2 Operating income $ 182.4 $ 198.4 $ 179.8 $ 11.3 Net income (loss) $ 41.0 $ 51.3 $ 43.7 $ (92.9 ) Earnings (loss) per common share: Basic earnings (loss) per common share $ 0.35 $ 0.44 $ 0.38 $ (0.80 ) Diluted earnings (loss) per common share $ 0.35 $ 0.44 $ 0.38 $ (0.80 ) Fiscal Quarter (in millions, except per share data) First Second (2) Third Fourth (3) 2018 Revenues $ 816.1 $ 826.9 $ 789.7 $ 1,155.3 Operating income $ 172.1 $ 181.8 $ 155.8 $ 124.4 Net income (loss) $ 45.4 $ 54.0 $ 36.1 $ (42.0 ) Earnings (loss) per common share: Basic earnings (loss) per common share $ 0.50 $ 0.59 $ 0.39 $ (0.37 ) Diluted earnings (loss) per common share $ 0.48 $ 0.57 $ 0.38 $ (0.37 ) (1) During the fourth quarter of 2019, we recorded $170.6 million of impairment on our goodwill and other intangible assets. See Note 8, “Goodwill and Other Intangible Assets,” for further details. (2) During the second quarter of 2018, the Company recorded a recovery of loan losses and unfunded loan commitments of $17.0 million relating to the JIVDC. See Note 5, “Acquisitions and Other Investments,” for further details. (3) During the fourth quarter of 2018, we acquired Pinnacle, which resulted in the incurrence of $74.7 million in pre-opening and acquisition costs. See Note 5, “Acquisitions and Other Investments,” for further details. In addition, we recorded a $34.3 million impairment of long-lived assets. See Note 7, “Property and Equipment,” for further details. Lastly, we recorded a $17.2 million loss on early extinguishment of debt. See Note 10, “Long-term Debt,” |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 21—Subsequent Events In February 2020, we closed on our investment in Barstool Sports, Inc. (“Barstool Sports”), a leading digital sports, entertainment and media platform, pursuant to a stock purchase agreement with Barstool Sports and certain stockholders of Barstool Sports (the “Sellers”), in which we purchased approximately 36% of the common stock, par value $0.0001 per share, of Barstool Sports (“Barstool Sports Common Stock”) for a purchase price of approximately $163.0 million . The purchase price consisted of approximately $135.0 million in cash and $28.0 million in shares of non-voting convertible preferred stock of the Company (the “Penn Preferred Stock”). 1/1,000 th of a share of the Penn Preferred Stock will be convertible into one share of common stock, par value $0.01 per share, of the Company (“Penn Common Stock”), and the Penn Preferred Stock will be entitled to participate equally and ratably in all dividends and distributions paid to holders of Penn Common Stock based on the number of shares of Penn Common Stock into which such Penn Preferred Stock could convert. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The Consolidated Financial Statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). |
Principles of Consolidation | Principles of Consolidation: The Consolidated Financial Statements include the accounts of Penn National Gaming, Inc. and its subsidiaries. Investments in and advances to unconsolidated affiliates that do not meet the consolidation criteria of the authoritative guidance for voting interest entities (“VOEs”) or variable interest entities (“VIEs”) are accounted for under the equity method. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates: The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements , and (iii) the reported amounts of revenues and expenses during the reporting period. Estimates used by us include, among other things, the useful lives for depreciable and amortizable assets, the allowance for doubtful accounts receivable, income tax provisions, the evaluation of the future realization of deferred tax assets, determining the adequacy of reserves for self-insured liabilities, the liabilities associated with our my choice program, the initial measurements of financing obligations associated with the Master Leases |
Segment Information | Segment Information: We view each of our gaming and racing properties as an operating segment with the exception of our two properties in Jackpot, Nevada, which we view as one operating segment. We consider our combined VGT operations, by state, to be separate operating segments. See Note 17, “Segment Information,” for further information. For financial reporting purposes, we aggregate our operating segments into the following four reportable segments: Location Real Estate Assets Lease or Ownership Structure Northeast segment Ameristar East Chicago East Chicago, Indiana Pinnacle Master Lease Greektown Casino-Hotel (1) Detroit, Michigan Greektown Lease Hollywood Casino Bangor Bangor, Maine Penn Master Lease Hollywood Casino at Charles Town Races Charles Town, West Virginia Penn Master Lease Hollywood Casino Columbus Columbus, Ohio Penn Master Lease Hollywood Casino Lawrenceburg Lawrenceburg, Indiana Penn Master Lease Hollywood Casino at Penn National Race Course Grantville, Pennsylvania Penn Master Lease Hollywood Casino Toledo Toledo, Ohio Penn Master Lease Hollywood Gaming at Dayton Raceway Dayton, Ohio Penn Master Lease Hollywood Gaming at Mahoning Valley Race Course Youngstown, Ohio Penn Master Lease Marquee by Penn (2) Pennsylvania N/A Meadows Racetrack and Casino Washington, Pennsylvania Meadows Lease Plainridge Park Casino Plainville, Massachusetts Pinnacle Master Lease South segment (3) 1 st Jackpot Casino Tunica, Mississippi Penn Master Lease Ameristar Vicksburg Vicksburg, Mississippi Pinnacle Master Lease Boomtown Biloxi Biloxi, Mississippi Penn Master Lease Boomtown Bossier City Bossier City, Louisiana Pinnacle Master Lease Boomtown New Orleans New Orleans, Louisiana Pinnacle Master Lease Hollywood Casino Gulf Coast Bay St. Louis, Mississippi Penn Master Lease Hollywood Casino Tunica Tunica, Mississippi Penn Master Lease L’Auberge Baton Rouge Baton Rouge, Louisiana Pinnacle Master Lease L’Auberge Lake Charles Lake Charles, Louisiana Pinnacle Master Lease Margaritaville Resort Casino (4) Bossier City, Louisiana Margaritaville Lease West segment Ameristar Black Hawk Black Hawk, Colorado Pinnacle Master Lease Cactus Petes and Horseshu Jackpot, Nevada Pinnacle Master Lease M Resort Henderson, Nevada Penn Master Lease Tropicana Las Vegas Las Vegas, Nevada Owned Zia Park Casino Hobbs, New Mexico Penn Master Lease Midwest segment Ameristar Council Bluffs Council Bluffs, Iowa Pinnacle Master Lease Argosy Casino Alton (5) Alton, Illinois Penn Master Lease Argosy Casino Riverside Riverside, Missouri Penn Master Lease Hollywood Casino Aurora Aurora, Illinois Penn Master Lease Hollywood Casino Joliet Joliet, Illinois Penn Master Lease Hollywood Casino at Kansas Speedway (6) Kansas City, Kansas Owned - JV Hollywood Casino St. Louis Maryland Heights, Missouri Penn Master Lease Prairie State Gaming (2) Illinois N/A River City Casino St. Louis, Missouri Pinnacle Master Lease (1) Acquired on May 23, 2019 (2) VGT route operations (3) Resorts Casino Tunica ceased operations on June 30, 2019, but remains subject to the Penn Master Lease. (4) Acquired on January 1, 2019 (5) The riverboat is owned by us and not subject to the Penn Master Lease. (6) Pursuant to a joint venture (“JV”) with International Speedway Corporation (“International Speedway”) and includes the Company’s 50% investment in Kansas Entertainment, LLC (“Kansas Entertainment”), which owns Hollywood Casino at Kansas Speedway. |
Cash and Cash Equivalents | Cash and Cash Equivalents: The Company considers all cash balances and highly-liquid investments with original maturities of three months or less at the date of purchase to be cash and cash equivalents. |
Concentration of Credit Risk | Concentration of Credit Risk: Financial instruments that subject the Company to credit risk consist of cash and cash equivalents and accounts receivable. The Company’s policy is to limit the amount of credit exposure to any one financial institution, and place investments with financial institutions evaluated as being creditworthy, or in short-term money market and tax-free bond funds which are exposed to minimal interest rate and credit risk. The Company has bank deposits and overnight repurchase agreements that exceed federally-insured limits. Concentration of credit risk, with respect to casino receivables, is limited through the Company’s credit evaluation process. The Company issues markers to approved casino customers only following investigations of creditworthiness. |
Property and Equipment | Property and Equipment: Property and equipment are stated at cost, less accumulated depreciation. Capital expenditures are accounted for as either project capital or maintenance (replacement) capital expenditures. Project capital expenditures are for fixed asset additions that expand an existing facility or create a new facility. Maintenance capital expenditures are expenditures to replace existing fixed assets with a useful life greater than one year that are obsolete, worn out or no longer cost-effective to repair. Maintenance and repairs that neither add materially to the value of the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in the determination of income. The estimated useful lives of property and equipment are determined based on the nature of the assets as well as the Company’s current operating strategy. Depreciation of property and equipment is recorded using the straight-line method over the shorter of the estimated useful life of the asset or the related lease term, if any, as follows: Years Land improvements 15 Buildings and improvements 5 to 31 Vessels 10 to 35 Furniture, fixtures and equipment 3 to 31 All costs funded by the Company considered to be an improvement to the real estate assets subject to any of our Triple Net Leases are recorded as leasehold improvements. Leasehold improvements are depreciated over the shorter of the estimated useful life of the improvement or the related lease term. The Company reviews the carrying amount of its property and equipment for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable based on undiscounted estimated future cash flows expected to result from its use and eventual disposition. The factors considered by the Company in |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets: Goodwill represents the future economic benefits of a business combination measured as the excess of the purchase price over the fair value of net assets acquired and has been allocated to our reporting units. Goodwill is tested annually, or more frequently if indicators of impairment exist. For the quantitative goodwill impairment test, an income approach, in which a discounted cash flow (“DCF”) model is utilized, and a market-based approach using guideline public company multiples of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) from the Company’s peer group are utilized in order to estimate the fair market value of the Company’s reporting units. In determining the carrying amount of each reporting unit that utilizes real estate assets subject to the Triple Net Leases, if and as applicable, (i) the Company allocates each reporting unit their pro-rata portion of the right-of-use (“ROU”) assets, lease liabilities, and/or financing obligations, and (ii) pushes down the carrying amount of the property and equipment subject to such leases. The Company compares the fair value of its reporting units to the carrying amounts. If the carrying amount of the reporting unit exceeds the fair value, an impairment is recorded equal to the amount of the excess (not to exceed the amount of goodwill allocated to the reporting unit). We consider our gaming licenses, trademarks, and certain other intangible assets to be indefinite-lived based on our future expectations to operate our gaming properties indefinitely as well as our historical experience in renewing these intangible assets at minimal cost with various state commissions. Indefinite-lived intangible assets are tested annually for impairment, or more frequently if indicators of impairment exist, by comparing the fair value of the recorded assets to their carrying amount. If the carrying amounts of the indefinite-lived intangible assets exceed their fair value, an impairment is recognized. The Company completes its testing of its indefinite-lived intangible assets prior to assessing the realizability of its goodwill. The Company assesses the fair value of its gaming licenses using the Greenfield Method under the income approach, which estimates the fair value using a DCF model assuming the Company built a casino with similar utility to that of the existing casino. The method assumes a theoretical start-up company going into business without any assets other than the intangible asset being valued. The Company assesses the fair value of its trademarks using the relief-from-royalty method under the income approach. The principle behind this method is that the value of the trademark is equal to the present value of the after-tax royalty savings attributable to the owned trademark. Our annual goodwill and other indefinite-lived intangible assets impairment test is performed on October 1 st |
Equity Securities | Equity Securities: The Company’s equity securities (including warrants) are measured at fair value each reporting period with unrealized holding gains and losses included in current period earnings. During the year ended December 31, 2019 , the Company recognized a holding gain of $19.9 million related to equity securities held as of December 31, 2019, which is included in “Other,” as reported in “Other income (expenses)” within our Consolidated Statements of Income. |
Financing Obligations | Financing Obligations: Subsequent to the adoption of Accounting Standards Codification (“ASC”) Topic 842, “Leases” (“ASC 842”) on January 1, 2019, certain of the components contained within our Master Leases (primarily buildings) are accounted for as financing obligations, rather than leases. Prior to the adoption of ASC 842, our Master Leases, in their entirety, were accounted for as financing obligations. See Note 3, “New Accounting Pronouncements,” for a discussion of the impact of ASC 842 on our Consolidated Financial Statements. On November 1, 2013, the Company spun-off its real estate assets into GLPI (the “Spin-Off”) and entered into the Penn Master Lease. This transaction did not meet all of the requirements for sale-leaseback accounting treatment under ASC Topic 840, “Leases,” (“ASC 840”); specifically, the Penn Master Lease contains provisions that indicate the Company has prohibited forms of continuing involvement in the leased assets, which are not a normal leaseback. Accordingly, at lease inception, we calculated a financing obligation based on the future minimum lease payments discounted at our estimated incremental borrowing rate at lease inception over the lease term of 35 years , which was determined to be 9.7% . The lease term included renewal options that were reasonably assured of being exercised and the funded construction of certain leased assets in development at the commencement of the Penn Master Lease . On October 15, 2018, in connection with the Pinnacle Acquisition, we assumed the Pinnacle Master Lease. Within a business combination, an arrangement that previously did not meet all of the requirements for sale-leaseback accounting treatment (and is accounted for as a financing obligation by the acquiree) retains its classification as a financing obligation on the acquiring entity’s consolidated balance sheets at the business combination date. As of the date of acquisition, we calculated the financing obligation based on the future minimum lease payments discounted at a rate determined to be fair value at the business combination date, which was determined to be 7.3% , over the remaining lease term of 32.5 years . The remaining lease term included renewal options that were reasonably assured of being exercised. Furthermore, in conjunction with the Pinnacle Acquisition, GLPI acquired the real estate assets associated with Plainridge Park Casino and leased back such assets to the Company pursuant to an amendment to the Pinnacle Master Lease (the “Plainridge Park Casino Sale-Leaseback”). The effective yield used to determine the financing obligation associated with the Plainridge Park Casino Sale-Leaseback was 9.6% . |
Operating and Finance Leases | Operating and Finance Leases: The Company determines if a contract is or contains a leasing element at contract inception or the date in which a modification of an existing contract occurs. In order for a contract to be considered a lease, the contract must transfer the right to control the use of an identified asset for a period of time in exchange for consideration. Control is determined to have occurred if the lessee has the right to (i) obtain substantially all of the economic benefits from the use of the identified asset throughout the period of use and (ii) direct the use of the identified asset. Upon adoption of ASC 842, we elected the following policies: (a) to account for lease and non-lease components as a single component for all classes of underlying assets and (b) to not recognize short-term leases (i.e., leases that are less than 12 months and do not contain purchase options) within the Consolidated Balance Sheets, with the expense related to these short-term leases recorded in total operating expenses within the Consolidated Statements of Income. The Company has leasing arrangements that contain both lease and non-lease components. We account for both the lease and non-lease components as a single component for all classes of underlying assets. In determining the present value of lease payments at lease commencement date, the Company utilizes its incremental borrowing rate based on the information available, unless the rate implicit in the lease is readily determinable. The liability for operating and finance leases is based on the present value of future lease payments. Operating lease expenses are recorded as rent expense, which is included within general and administrative expense, within the Consolidated Statements of Income and presented as operating cash outflows within the Consolidated Statements of Cash Flows. Finance lease expenses are recorded as amortization expense, which is included within depreciation and amortization expense within the Consolidated Statements of Income and interest expense over the lease term. Principal payments associated with finance leases are presented as financing cash outflows and interest payments associated with finance leases are presented as operating cash outflows within our Consolidated Statements of Cash Flows. |
Debt Discount and Debt Issuance Costs | Debt Discount and Debt Issuance Costs: Debt issuance costs that are incurred by the Company in connection with the issuance of debt are deferred and amortized to interest expense using the effective interest method over the contractual term of the underlying indebtedness. These costs are classified as a direct reduction of long-term debt within the Company’s Consolidated Balance Sheets. |
Self-Insurance Reserves | Self-Insurance Reserves: The Company is self-insured for employee health coverage, general liability and workers’ compensation up to certain stop-loss amounts (for general liability and workers’ compensation). We use a reserve method for each reported claim plus an allowance for claims incurred but not yet reported to a fully-developed claims reserve method based on an actuarial computation of ultimate liability. Self-insurance reserves are included in “Accrued expenses and other current liabilities” within the Company’s Consolidated Balance Sheets. |
Contingent Purchase Price and Application of Business Combination Accounting | Contingent Purchase Price: The consideration for the Company’s acquisitions may include future payments that are contingent upon the occurrence of a particular event. We record an obligation for such contingent payments at fair value as of the acquisition date. We revalue our contingent purchase price obligations each reporting period. Changes in the fair value of the contingent purchase price obligation can result from changes to one or multiple inputs, including adjustments to the discount rate and changes in the assumed probabilities of successful achievement of certain financial targets. The changes in the fair value of contingent purchase price are recognized within our Consolidated Statements of Income as a component of “General and administrative” expense. Application of Business Combination Accounting: |
Income Taxes | Income Taxes: Under ASC Topic 740, “Income Taxes” (“ASC 740”), deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The realizability of the net deferred tax assets is evaluated quarterly by assessing the valuation allowance and by adjusting the amount of the allowance, if necessary. The Company considers all available positive and negative evidence including projected future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. The evaluation of both positive and negative evidence is a requirement pursuant to ASC 740 in determining more-likely-than-not the net deferred tax assets will be realized. In the event the Company determines that the deferred income tax assets would be realized in the future in excess of their net recorded amount, an adjustment to the valuation allowance would be recorded, which would reduce the provision for income taxes. |
Revenue Recognition and Customer-related Liabilities | Customer-related Liabilities The Company has three general types of liabilities related to contracts with customers: (i) the obligation associated with our my choice program (loyalty points and tier status benefits), (ii) advance payments on goods and services yet to be provided and for unpaid wagers, and (iii) deferred revenue associated with third-party sports betting operators for online sports betting and related iGaming market access. Our my choice program allows members to utilize their reward membership cards to earn loyalty points that are redeemable for slot play and complimentaries, such as food and beverage at our restaurants, lodging at our hotels and products offered at our retail stores across the vast majority of our properties. In addition, members of the my choice program earn credit toward tier status, which entitles them to receive certain other benefits, such as gifts. The Company accounts for the obligation associated with our my choice program utilizing a deferred revenue model, which defers revenue at the point in time when the loyalty points and tier status benefits are earned by our customers. Deferred revenue associated with the my choice program is recognized at the point-in-time when the loyalty points are redeemed by our customers or at the point-in-time when our customers receive the tier status benefits. The obligation associated with our my choice program is based on the estimated SSP of the loyalty points and the tier status benefits earned after factoring in the likelihood of redemption. The obligation associated with our my choice program, which is included in “Accrued expenses and other current liabilities” within our Consolidated Balance Sheets, was $36.2 million and $39.9 million as of December 31, 2019 and 2018 , respectively, and consisted principally of the obligation associated with the loyalty points. Our loyalty point obligations are generally settled within six months of issuance. Changes between the opening and closing balances primarily relate to the timing of our customers’ election to redeem loyalty points as well as the timing of when our customers receive their earned tier status benefits. The Company’s advance payments on goods and services yet to be provided and for unpaid wagers primarily consist of the following: (i) deposits on rooms and convention space, (ii) money deposited on behalf of a customer in advance of their property visit (referred to as “safekeeping” or “front money”), (iii) outstanding tickets generated by slot machine play or pari-mutuel wagering, (iv) outstanding chip liabilities, (v) unclaimed jackpots, and (vi) gift cards redeemable at our properties. Advance payments on goods and services are recognized as revenue when the good or service is transferred to the customer. Unpaid wagers primarily relate to the Company’s obligation to settle outstanding slot tickets, pari-mutuel racing tickets and gaming chips with customers and generally represent obligations stemming from prior wagering events, of which revenue was previously recognized. The Company’s advance payments on goods and services yet to be provided and for unpaid wagers were $42.2 million and $34.3 million as of December 31, 2019 and 2018 , respectively, of which $0.6 million and $0.7 million were classified as long-term, respectively. The current portion and long-term portion of our advance payments on goods and services yet to be provided and for unpaid wagers are included in “Accrued expenses and other current liabilities” and “Other long-term liabilities” within our Consolidated Balance Sheets, respectively. Revenue Recognition: Our revenue from contracts with customers consists of gaming wagers, food and beverage transactions, retail transactions, hotel room sales, racing wagers, sports betting wagers, and management services related to the management of external casinos and reimbursable costs associated with management contracts. In May 2018, our management contract was terminated for Hollywood Casino-Jamul San Diego, which is located in San Diego, California. In addition, our management contract was terminated for Casino Rama, which is located in Ontario, Canada, in July 2018. See Note 4, “Revenue Disaggregation,” for information on our revenue by type and geographic location. The transaction price for a gaming wagering contract is the difference between gaming wins and losses, not the total amount wagered. The transaction price for food and beverage, hotel and retail contracts is the net amount collected from the customer for such goods and services. Sales tax and other taxes collected on behalf of governmental authorities are accounted for on the net basis and are not included in revenues or expenses. The transaction price for our racing operations, inclusive of live racing events conducted at our racing facilities and our import and export arrangements, is the commission received from the pari-mutuel pool less contractual fees and obligations primarily consisting of purse funding requirements, simulcasting fees, tote fees and certain pari-mutuel taxes that are directly related to the racing operations. The transaction price for our former management service contracts was the amount collected for services rendered in accordance with the contractual terms. The transaction price for the reimbursable costs associated with our former management contracts was the gross amount of the reimbursable expenditure, which primarily consisted of payroll costs incurred by the Company for the benefit of the managed entity. Since the Company was the controlling entity to the arrangement, the reimbursement was recorded on a gross basis with an offsetting amount charged to operating expense. Gaming revenue contracts involve two performance obligations for those customers earning points under our my choice program and a single performance obligation for customers that do not participate in the my choice program. The Company applies a practical expedient by accounting for its gaming contracts on a portfolio basis as opposed to an individual wagering contract. For purposes of allocating the transaction price in a gaming contract between the wagering performance obligation and the obligation associated with the loyalty points earned, we allocate an amount to the loyalty point contract liability based on the standalone selling price (“SSP”) of the points earned, which is determined by the value of a point that can be redeemed for slot play and complimentaries; such as, food and beverage at our restaurants, lodging at our hotels and products offered at our retail stores, less estimated breakage. The allocated revenue for gaming wagers is recognized when the wagering occurs as all such wagers settle immediately. The liability associated with the loyalty points is deferred and recognized as revenue when the customer redeems the loyalty points for slot play and complimentaries and such goods and services are delivered to the customer. Food and beverage, hotel and retail services have been determined to be separate, standalone performance obligations and the transaction price for such contracts is recorded as revenue as the good or service is transferred to the customer over their stay at the hotel or when the delivery is made for the food and beverage or retail product. Cancellation fees for hotel and meeting space services are recognized upon cancellation by the customer and are included in food, beverage, hotel and other revenue. Racing revenue contracts, inclusive of our (i) host racing facilities, (ii) import arrangements that permit us to simulcast in live racing events occurring at other racetracks, and (iii) export arrangements that permit our live racing events to be simulcast at other racetracks, provide access to and the processing of wagers into the pari-mutuel pool. The Company has concluded it is not the controlling entity to the arrangement, but rather functions as an agent to the pari-mutuel pool. Commissions earned from the pari-mutuel pool less contractual fees and obligations are recognized on a net basis, which is included within food, beverage, hotel and other revenues. Management services have been determined to be separate, standalone performance obligations and the transaction price for such contracts was recorded as services were performed. The Company recorded revenues on a monthly basis calculated by applying the contractual rate called for in the contracts. Penn Interactive generates in-app purchase and advertising revenues from free-to-play social casino games, which can be downloaded to mobile phones and tablets from digital storefronts. Players can purchase virtual playing credits within our social casino games, which allows for increased playing opportunities and functionality. Penn Interactive records deferred revenue from the sale of virtual playing credits and recognizes this revenue over the average redemption period of the credits, which is approximately three days . Advertising revenues are recognized in the period when the advertising impression, click or install delivery occurs. Penn Interactive also generates revenue through revenue-sharing arrangements with third-party content providers whereby revenues are recognized on a net basis since Penn Interactive is not the controlling entity in the arrangement. Complimentaries associated with Gaming Contracts |
Gaming and Racing Taxes | Gaming and Racing Taxes: We are subject to gaming and pari-mutuel taxes based on gross gaming revenue and pari-mutuel revenue in the jurisdictions in which we operate. The Company primarily recognizes gaming and pari-mutuel tax expense based on the statutorily required percentage of revenue that is required to be paid to state and local jurisdictions in the states where or in which wagering occurs. For the years ended December 31, 2019 , 2018 and 2017 , these expenses, which were recorded primarily in gaming expense within the Consolidated Statements of Income, were $1,590.0 million , $1,102.3 million , and $983.3 million , respectively. |
Stock-Based Compensation | Stock-Based Compensation: The cost of employee services received in exchange for an award of equity instruments is based on the grant-date fair value of the award and the expense is recognized ratably over the requisite service period. The Company accounts for forfeitures in the period in which they occur based on actual amounts. The fair value of stock options is estimated at the grant date using the Black-Scholes option-pricing model, which requires us to make assumptions, including the expected term, which is based on the contractual term of the stock option and historical exercise data of the Company’s employees; the risk-free interest rate, which is based on the U.S. Treasury spot rate with a term equal to the expected term assumed at the grant date; the expected volatility, which is estimated based on the historical volatility of the Company’s stock price over the expected term assumed at the grant date; and the expected dividend yield, which is zero |
Earnings Per Share | Earnings Per Share: |
Voting Interest Entities and Variable Interest Entities | Voting Interest Entities and Variable Interest Entities: The Company consolidates all subsidiaries or other entities in which it has a controlling financial interest. The consolidation guidance requires an analysis to determine if an entity should be evaluated for consolidation using the VOE model or the VIE model. Under the VOE model, controlling financial interest is generally defined as a majority ownership of voting rights. Under the VIE model, controlling financial interest is defined as (i) the power to direct activities that most significantly impact the economic performance of the entity and (ii) the obligation to |
New Accounting Pronouncements | Accounting Pronouncements Implemented in 2019 On January 1, 2019, the Company adopted ASC 842, and all the related amendments (the “new lease standard”) using the modified retrospective method with an effective date of January 1, 2019 (the “adoption date”) and a cumulative-effect adjustment to retained earnings. The core principle of ASC 842 is that a lessee should recognize on the balance sheet the lease assets and lease liabilities that arise from all lease arrangements with terms greater than 12 months. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. As part of the adoption, the Company elected to utilize the package of practical expedients included in this guidance, which permitted the Company to not reassess (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) the initial direct costs for existing leases. Master Leases The most significant impact of the adoption of the new lease standard relates to the accounting for our Master Leases with GLPI. Under previous GAAP, as contained within ASC 840, the Company concluded that (i) the Penn Master Lease and (ii) the Pinnacle Master Lease to each be a failed sale-leaseback transaction resulting in (a) the land and building assets associated with the Master Leases to be recognized in “Property and equipment, net” within the Consolidated Balance Sheets, (b) the recognition of a financing obligation, with the associated interest recorded to “Interest expense, net” within the Consolidated Statements of Income, and (c) the contingent rentals to be recorded as additional interest expense. Under the provisions of the new lease standard, the Company was required to evaluate its existing sale-leaseback transactions with GLPI to determine whether a sale had occurred, and if a sale had occurred, to determine the classification (operating or finance) of each component contained within each of the Master Leases. Lease components contained within each of the Master Leases that were determined to be operating leases (consisting primarily of the land components) at the adoption date resulted in (i) the derecognition of the existing financing obligation and the carrying amount of the property and equipment with an adjustment to the opening balance of retained earnings and (ii) the recognition of an operating lease liability and an operating lease ROU asset. Lease components contained within each of the Master Leases that were determined to continue to be financing obligations (consisting primarily of the building components) at the adoption date resulted in (i) the continued recognition of the leased assets in “Property and equipment, net” within our Consolidated Balance Sheets and (ii) the continued recognition of the financing obligation utilizing assumptions as determined (a) at the lease commencement date with respect to the Penn Master Lease or (b) at the acquisition date with respect to the Pinnacle Master Lease. Our Hollywood Casino at Dayton Raceway and Hollywood Casino at Mahoning Valley Race Course (“Dayton and Mahoning Valley”) properties included within the Penn Master Lease were previously accounted for under build-to-suit guidance pursuant to ASC 840. The Company was required to evaluate the components contained within the build-to-suit arrangements and determine the classification (operating or finance) under the provisions of the new lease standard at the adoption date. The Dayton and Mahoning Valley lease components were determined to be finance leases, which resulted in (i) the recognition of a finance lease ROU asset (recorded to depreciation and amortization expense over the lease term), (ii) a corresponding finance lease liability (recorded to interest expense over the lease term), and (iii) a write-off of the previous (a) carrying amount of the property and equipment and (b) financing obligation recorded with an adjustment to the opening balance of retained earnings at the adoption date. Operating Leases, inclusive of the Meadows Lease The adoption of the new lease standard required us to recognize ROU assets and lease liabilities that had not previously been recorded within the Consolidated Balance Sheets. Upon adoption, the lease liability for operating leases was based on the present value of future lease payments and the ROU asset for operating leases was based on the operating lease liability adjusted for the reclassification of certain balance sheet amounts, such as deferred rent. Under ASC 842, deferred and prepaid rent are no longer presented separately. Leases that are short-term in nature are not recognized as ROU assets within the Consolidated Balance Sheets, but are recognized as an expense (recorded within total operating expenses) within the Consolidated Statements of Income. The impact of the adoption of the new lease standard on our Consolidated Balance Sheets at January 1, 2019 was as follows (only financial statement line items impacted are presented): Impacts of: (in millions) As Reported as of December 31, 2018 Financing Obligations - Master Leases (1) Finance Leases - Dayton and Mahoning Valley Operating Leases - Master Leases (2) Operating Lease - Meadows (3) Other Operating Leases - Non-Master Leases As Adjusted for ASC 842 Increase/(Decrease) Assets Current assets Prepaid expenses $ 63.0 $ — $ — $ — $ — $ (1.0 ) $ 62.0 $ (1.0 ) Total current assets $ 677.6 $ — $ — $ — $ — $ (1.0 ) $ 676.6 $ (1.0 ) Property and equipment, net (4) $ 6,868.8 $ — $ (164.3 ) $ (1,407.4 ) $ — $ — $ 5,297.1 $ (1,571.7 ) Goodwill $ 1,228.4 $ 5.5 $ — $ — $ — $ — $ 1,233.9 $ 5.5 Operating lease right-of-use assets (5) $ — $ — $ — $ 3,541.2 $ 112.8 $ 152.5 $ 3,806.5 $ 3,806.5 Finance lease right-of-use assets (6) $ — $ — $ 224.5 $ — $ — $ — $ 224.5 $ 224.5 Total assets $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 Liabilities Current liabilities Current portion of financing obligations (7) $ 67.8 $ — $ (1.5 ) $ (16.2 ) $ — $ — $ 50.1 $ (17.7 ) Current portion of operating lease liabilities (5) $ — $ — $ — $ 72.9 $ 20.5 $ 8.9 $ 102.3 $ 102.3 Current portion of finance lease liabilities (6) $ — $ — $ 5.8 $ — $ — $ — $ 5.8 $ 5.8 Accrued expenses and other current liabilities $ 578.0 $ — $ — $ — $ — $ (0.5 ) $ 577.5 $ (0.5 ) Total current liabilities $ 738.4 $ — $ 4.3 $ 56.7 $ 20.5 $ 8.4 $ 828.3 $ 89.9 Long-term portion of financing obligations (7) $ 7,080.6 $ 5.5 $ (181.3 ) $ (2,760.6 ) $ — $ — $ 4,144.2 $ (2,936.4 ) Long-term portion of operating lease liabilities (5) $ — $ — $ — $ 3,467.1 $ 92.3 $ 145.0 $ 3,704.4 $ 3,704.4 Long-term portion of finance lease liabilities (6) $ — $ — $ 218.3 $ — $ — $ — $ 218.3 $ 218.3 Deferred income taxes (8) $ — $ — $ 4.3 $ 299.5 $ — $ — $ 303.8 $ 303.8 Other long-term liabilities $ 60.7 $ — $ — $ — $ — $ (1.9 ) $ 58.8 $ (1.9 ) Total liabilities $ 10,229.8 $ 5.5 $ 45.6 $ 1,062.7 $ 112.8 $ 151.5 $ 11,607.9 $ 1,378.1 Stockholders’ equity Retained earnings (accumulated deficit) $ (968.0 ) $ — $ 14.6 $ 1,071.1 $ — $ — $ 117.7 $ 1,085.7 Total Penn National stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total liabilities and stockholders’ equity $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 (1) During the first quarter of 2019, the Company identified an adjustment to the purchase price allocation associated with the Pinnacle Acquisition. The purchase price adjustment increased the financing obligation upon the adoption of the new lease standard, resulting in an increase to goodwill (see Note 5, “Acquisitions and Other Investments” ). (2) Represents components contained within each of the Master Leases determined to be operating leases (primarily land). (3) Represents the triple net lease with GLPI for the real estate assets used in the operations of Meadows Racetrack and Casino (the “Meadows Lease”). (4) Represents the (i) derecognition of the carrying amount of the property and equipment, net, associated with land components contained within our Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) derecognition of the carrying amount of the property and equipment, net, associated with land and building components associated with Dayton and Mahoning Valley determined to be finance leases upon the adoption of the new lease standard. (5) Operating lease ROU assets represent (i) the land components contained within the Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) with respect to other Operating Leases, represent (a) the Meadows Lease, which was acquired by the Company in conjunction with the acquisition of Pinnacle; (b) ground and levee leases with landlords, which were not assumed by GLPI and remain an obligation of the Company; and (c) buildings and equipment not associated with our Master Leases. For leases where the rate implicit in the lease was not readily determinable, we used our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. We utilized the incremental borrowing rate on the adoption date for operating leases that commenced prior to that date. The operating lease liability is based on the net present value of future lease payments. (6) Amounts primarily represent finance leases associated with Dayton and Mahoning Valley, which are included in the Penn Master Lease, that under ASC 840 utilized specific build-to-suit guidance. The adoption of the new lease standard required the Company to evaluate the components under current guidance contained within the new lease standard, which resulted in all components being classified as finance leases. Finance leases result in (i) the recognition of a finance lease ROU asset amortized over the lease term and (ii) a corresponding finance lease liability (recorded to interest expense over the lease term). We utilized our incremental borrowing rate based on the information available at the adoption date in determining the present value of lease payments. The finance lease liability is based on the net present value of future lease payments. (7) Represents components associated with our Master Leases that remain financing obligations (primarily buildings). The financing obligation at the adoption date was calculated utilizing previous assumptions as determined (a) at the lease commencement date with respect to the Penn Master Lease and (b) at the acquisition date with respect to the Pinnacle Master Lease. (8) Represents the tax impacts related to the adoption of the new lease standard. See Note 13, “Income Taxes.” Accounting Pronouncements to be Implemented in 2020 In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurements of Credit Losses on Financial Instruments” (“ASU 2016-13”), which sets forth a “current expected credit loss” (referred to as “CECL”) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and must be applied through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. Although we are still finalizing our assessment of the impact of the adoption of ASU 2016-13, which is effective January 1, 2020, we currently do not expect it to have a material impact on our Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-15, “Customer’s Accounting for Implementation Cost Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”). Under the new guidance, customers will apply the same criteria for capitalizing implementation costs as they would for an arrangement that has a software license. This will result in certain implementation costs being capitalized; the associated amortization charge will, however, be recorded as an operating expense. Under the previous guidance, costs incurred when implementing a cloud computing arrangement deemed to be a service contract are recorded as an operating expense when incurred. ASU 2018-15 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities can choose to adopt the new guidance prospectively to eligible costs incurred on or after the date the guidance is first applied or retrospectively. We have elected to adopt the net guidance on a prospective basis. Although we are still finalizing our assessment of the impact of the adoption of ASU 2018-15, which is effective January 1, 2020, we currently do not expect it to have a material impact on our Consolidated Financial Statements. Accounting Pronouncements to be Implemented in 2021 In December 2019, the FASB issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes” (“ASU 2019-12”), which intends to simplify the guidance by removing certain exceptions to the general principles and clarifying or amending existing guidance. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Although we are currently evaluating the impact of the adoption of ASU 2019-12, we do not expect it to have a material impact on our Consolidated Financial Statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of operating segments within reportable segments | For financial reporting purposes, we aggregate our operating segments into the following four reportable segments: Location Real Estate Assets Lease or Ownership Structure Northeast segment Ameristar East Chicago East Chicago, Indiana Pinnacle Master Lease Greektown Casino-Hotel (1) Detroit, Michigan Greektown Lease Hollywood Casino Bangor Bangor, Maine Penn Master Lease Hollywood Casino at Charles Town Races Charles Town, West Virginia Penn Master Lease Hollywood Casino Columbus Columbus, Ohio Penn Master Lease Hollywood Casino Lawrenceburg Lawrenceburg, Indiana Penn Master Lease Hollywood Casino at Penn National Race Course Grantville, Pennsylvania Penn Master Lease Hollywood Casino Toledo Toledo, Ohio Penn Master Lease Hollywood Gaming at Dayton Raceway Dayton, Ohio Penn Master Lease Hollywood Gaming at Mahoning Valley Race Course Youngstown, Ohio Penn Master Lease Marquee by Penn (2) Pennsylvania N/A Meadows Racetrack and Casino Washington, Pennsylvania Meadows Lease Plainridge Park Casino Plainville, Massachusetts Pinnacle Master Lease South segment (3) 1 st Jackpot Casino Tunica, Mississippi Penn Master Lease Ameristar Vicksburg Vicksburg, Mississippi Pinnacle Master Lease Boomtown Biloxi Biloxi, Mississippi Penn Master Lease Boomtown Bossier City Bossier City, Louisiana Pinnacle Master Lease Boomtown New Orleans New Orleans, Louisiana Pinnacle Master Lease Hollywood Casino Gulf Coast Bay St. Louis, Mississippi Penn Master Lease Hollywood Casino Tunica Tunica, Mississippi Penn Master Lease L’Auberge Baton Rouge Baton Rouge, Louisiana Pinnacle Master Lease L’Auberge Lake Charles Lake Charles, Louisiana Pinnacle Master Lease Margaritaville Resort Casino (4) Bossier City, Louisiana Margaritaville Lease West segment Ameristar Black Hawk Black Hawk, Colorado Pinnacle Master Lease Cactus Petes and Horseshu Jackpot, Nevada Pinnacle Master Lease M Resort Henderson, Nevada Penn Master Lease Tropicana Las Vegas Las Vegas, Nevada Owned Zia Park Casino Hobbs, New Mexico Penn Master Lease Midwest segment Ameristar Council Bluffs Council Bluffs, Iowa Pinnacle Master Lease Argosy Casino Alton (5) Alton, Illinois Penn Master Lease Argosy Casino Riverside Riverside, Missouri Penn Master Lease Hollywood Casino Aurora Aurora, Illinois Penn Master Lease Hollywood Casino Joliet Joliet, Illinois Penn Master Lease Hollywood Casino at Kansas Speedway (6) Kansas City, Kansas Owned - JV Hollywood Casino St. Louis Maryland Heights, Missouri Penn Master Lease Prairie State Gaming (2) Illinois N/A River City Casino St. Louis, Missouri Pinnacle Master Lease (1) Acquired on May 23, 2019 (2) VGT route operations (3) Resorts Casino Tunica ceased operations on June 30, 2019, but remains subject to the Penn Master Lease. (4) Acquired on January 1, 2019 (5) The riverboat is owned by us and not subject to the Penn Master Lease. (6) Pursuant to a joint venture (“JV”) with International Speedway Corporation (“International Speedway”) and includes the Company’s 50% investment in Kansas Entertainment, LLC (“Kansas Entertainment”), which owns Hollywood Casino at Kansas Speedway. Adjusted EBITDAR for each reportable segment and reconciles Adjusted EBITDAR on a consolidated basis to Net income. For the year ended December 31, (in millions) 2019 2018 2017 Revenues: Northeast segment $ 2,399.9 $ 1,891.5 $ 1,756.6 South segment 1,118.9 394.4 224.3 West segment 642.5 437.9 380.4 Midwest segment 1,094.5 823.7 735.0 Other (1) 47.5 40.4 51.7 Intersegment eliminations (2) (1.9 ) — — Total $ 5,301.4 $ 3,587.9 $ 3,148.0 Adjusted EBITDAR (3) : Northeast segment $ 720.8 $ 583.8 $ 549.3 South segment 369.8 118.9 62.6 West segment 198.8 114.3 72.7 Midwest segment 403.6 294.3 249.7 Other (1) (87.8 ) (68.1 ) (55.2 ) Total (3) 1,605.2 1,043.2 879.1 Other operating benefits (costs) and other income (expenses): Rent expense associated with triple net operating leases (4) (366.4 ) (3.8 ) — Stock-based compensation (14.9 ) (12.0 ) (7.8 ) Cash-settled stock-based awards variance (0.8 ) 19.6 (23.4 ) Loss on disposal of assets (5.5 ) (3.2 ) (0.2 ) Contingent purchase price (7.0 ) (0.5 ) 6.8 Pre-opening and acquisition costs (22.3 ) (95.0 ) (9.7 ) Depreciation and amortization (414.2 ) (269.0 ) (267.1 ) Impairment losses (173.1 ) (34.9 ) (18.0 ) Recoveries on (provision for) loan loss and unfunded loan commitments — 17.0 (89.8 ) Insurance recoveries, net of deductible charges 3.0 0.1 0.3 Non-operating items for Kansas JV (3.7 ) (5.1 ) (5.8 ) Interest expense, net (534.2 ) (538.4 ) (463.2 ) Loss on early extinguishment of debt — (21.0 ) (24.0 ) Other 20.0 (7.1 ) (2.3 ) Income before income taxes 86.1 89.9 (25.1 ) Income tax benefit (expense) (43.0 ) 3.6 498.5 Net income $ 43.1 $ 93.5 $ 473.4 (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, and iGaming; 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. (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 charges; 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 (such as depreciation and amortization) added back for our JV in Kansas Entertainment. (4) The Company’s triple net operating leases include certain components of the Master Leases (primarily land), the Meadows Lease, the Margaritaville Lease, and the Greektown Lease. For the year ended December 31, (in millions) 2019 2018 2017 Capital expenditures: Northeast segment $ 96.2 $ 38.9 $ 26.3 South segment 29.8 10.6 6.3 West segment 21.2 12.8 35.7 Midwest segment 32.7 25.3 26.2 Other 10.7 5.0 4.8 Total capital expenditures $ 190.6 $ 92.6 $ 99.3 (in millions) Northeast South West Midwest Other Total As of December 31, 2019 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 90.9 $ 37.3 $ 128.3 Total assets (1) $ 2,273.7 $ 1,397.0 $ 752.1 $ 1,412.2 $ 8,359.5 $ 14,194.5 As of December 31, 2018 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 89.4 $ 39.0 $ 128.5 Total assets (2) $ 1,330.2 $ 1,082.3 $ 755.7 $ 1,411.5 $ 6,381.3 $ 10,961.0 As of December 31, 2017 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 88.3 $ 60.5 $ 148.9 Total assets (2) $ 921.0 $ 169.3 $ 625.0 $ 970.8 $ 2,548.7 $ 5,234.8 (1) As of December 31, 2019 , total assets of the Other category includes the real estate assets subject to the Master Leases, which are either classified as property and equipment, operating lease ROU assets, or finance lease ROU assets, depending on whether the underlying component of the Master Leases was determined to be an operating lease, a finance lease, or continue to be financing obligations, upon adoption of ASC 842. (2) |
Schedule of receivables | The Company’s receivables as of December 31, 2019 and 2018 primarily consisted of the following: December 31, (in millions) 2019 2018 Markers issued to customers $ 22.9 $ 17.2 Credit card receivables and other advances to customers 16.5 20.9 Receivables from ATM and cash kiosk transactions 14.4 19.2 Hotel and banquet receivables 6.5 8.1 Racing settlements 6.6 6.1 Receivables due from platform providers for social casino games 3.3 2.3 Other 26.2 36.2 Allowance for doubtful accounts (7.7 ) (3.2 ) Accounts receivable, net $ 88.7 $ 106.8 |
Schedule of estimated useful lives of property, plant and equipment | Depreciation of property and equipment is recorded using the straight-line method over the shorter of the estimated useful life of the asset or the related lease term, if any, as follows: Years Land improvements 15 Buildings and improvements 5 to 31 Vessels 10 to 35 Furniture, fixtures and equipment 3 to 31 Property and equipment, net, consisted of the following: December 31, (in millions) 2019 2018 Property and equipment - Not Subject to Master Leases Land and improvements $ 353.2 $ 344.0 Building, vessels and improvements 420.4 343.0 Furniture, fixtures and equipment 1,598.3 1,565.8 Leasehold improvements 183.6 152.9 Construction in progress 59.3 25.5 2,614.8 2,431.2 Less: Accumulated depreciation (1,548.3 ) (1,400.2 ) 1,066.5 1,031.0 Property and equipment - Subject to Master Leases Land and improvements (1) 1,525.9 2,971.0 Building, vessels and improvements (1) 3,664.6 3,845.0 5,190.5 6,816.0 Less: Accumulated depreciation (1,136.8 ) (978.2 ) 4,053.7 5,837.8 Property and equipment, net $ 5,120.2 $ 6,868.8 (1) Upon adoption of ASC 842, approximately $1.4 billion of land was derecognized and replaced with operating lease ROU assets based on the present value of future lease payments and $180.4 million of building and improvements, gross, was derecognized and replaced with finance lease ROU assets based on the present value of future lease payments. See Note 3, “New Accounting Pronouncements.” Depreciation expense was as follows: For the year ended December 31, (in millions) 2019 2018 2017 Depreciation expense (1) $ 381.6 $ 251.9 $ 248.2 (1) Of such amounts, $158.9 million , $112.1 million , and $92.4 million , respectively, pertained to real estate assets subject to either of our Master Leases. |
Schedule of complimentaries | Revenues recorded to food and beverage, hotel, and other and offset to gaming revenues were as follows: For the year ended December 31, (in millions) 2019 2018 Food and beverage $ 261.4 $ 137.2 Hotel 159.6 60.8 Other 17.6 8.1 Total complimentaries associated with gaming contracts $ 438.6 $ 206.1 |
New Accounting Pronouncements (
New Accounting Pronouncements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Schedule of impact of adoption of ASC 842 | The impact of the adoption of the new lease standard on our Consolidated Balance Sheets at January 1, 2019 was as follows (only financial statement line items impacted are presented): Impacts of: (in millions) As Reported as of December 31, 2018 Financing Obligations - Master Leases (1) Finance Leases - Dayton and Mahoning Valley Operating Leases - Master Leases (2) Operating Lease - Meadows (3) Other Operating Leases - Non-Master Leases As Adjusted for ASC 842 Increase/(Decrease) Assets Current assets Prepaid expenses $ 63.0 $ — $ — $ — $ — $ (1.0 ) $ 62.0 $ (1.0 ) Total current assets $ 677.6 $ — $ — $ — $ — $ (1.0 ) $ 676.6 $ (1.0 ) Property and equipment, net (4) $ 6,868.8 $ — $ (164.3 ) $ (1,407.4 ) $ — $ — $ 5,297.1 $ (1,571.7 ) Goodwill $ 1,228.4 $ 5.5 $ — $ — $ — $ — $ 1,233.9 $ 5.5 Operating lease right-of-use assets (5) $ — $ — $ — $ 3,541.2 $ 112.8 $ 152.5 $ 3,806.5 $ 3,806.5 Finance lease right-of-use assets (6) $ — $ — $ 224.5 $ — $ — $ — $ 224.5 $ 224.5 Total assets $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 Liabilities Current liabilities Current portion of financing obligations (7) $ 67.8 $ — $ (1.5 ) $ (16.2 ) $ — $ — $ 50.1 $ (17.7 ) Current portion of operating lease liabilities (5) $ — $ — $ — $ 72.9 $ 20.5 $ 8.9 $ 102.3 $ 102.3 Current portion of finance lease liabilities (6) $ — $ — $ 5.8 $ — $ — $ — $ 5.8 $ 5.8 Accrued expenses and other current liabilities $ 578.0 $ — $ — $ — $ — $ (0.5 ) $ 577.5 $ (0.5 ) Total current liabilities $ 738.4 $ — $ 4.3 $ 56.7 $ 20.5 $ 8.4 $ 828.3 $ 89.9 Long-term portion of financing obligations (7) $ 7,080.6 $ 5.5 $ (181.3 ) $ (2,760.6 ) $ — $ — $ 4,144.2 $ (2,936.4 ) Long-term portion of operating lease liabilities (5) $ — $ — $ — $ 3,467.1 $ 92.3 $ 145.0 $ 3,704.4 $ 3,704.4 Long-term portion of finance lease liabilities (6) $ — $ — $ 218.3 $ — $ — $ — $ 218.3 $ 218.3 Deferred income taxes (8) $ — $ — $ 4.3 $ 299.5 $ — $ — $ 303.8 $ 303.8 Other long-term liabilities $ 60.7 $ — $ — $ — $ — $ (1.9 ) $ 58.8 $ (1.9 ) Total liabilities $ 10,229.8 $ 5.5 $ 45.6 $ 1,062.7 $ 112.8 $ 151.5 $ 11,607.9 $ 1,378.1 Stockholders’ equity Retained earnings (accumulated deficit) $ (968.0 ) $ — $ 14.6 $ 1,071.1 $ — $ — $ 117.7 $ 1,085.7 Total Penn National stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total stockholders’ equity $ 731.2 $ — $ 14.6 $ 1,071.1 $ — $ — $ 1,816.9 $ 1,085.7 Total liabilities and stockholders’ equity $ 10,961.0 $ 5.5 $ 60.2 $ 2,133.8 $ 112.8 $ 151.5 $ 13,424.8 $ 2,463.8 (1) During the first quarter of 2019, the Company identified an adjustment to the purchase price allocation associated with the Pinnacle Acquisition. The purchase price adjustment increased the financing obligation upon the adoption of the new lease standard, resulting in an increase to goodwill (see Note 5, “Acquisitions and Other Investments” ). (2) Represents components contained within each of the Master Leases determined to be operating leases (primarily land). (3) Represents the triple net lease with GLPI for the real estate assets used in the operations of Meadows Racetrack and Casino (the “Meadows Lease”). (4) Represents the (i) derecognition of the carrying amount of the property and equipment, net, associated with land components contained within our Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) derecognition of the carrying amount of the property and equipment, net, associated with land and building components associated with Dayton and Mahoning Valley determined to be finance leases upon the adoption of the new lease standard. (5) Operating lease ROU assets represent (i) the land components contained within the Master Leases determined to be operating leases upon the adoption of the new lease standard; and (ii) with respect to other Operating Leases, represent (a) the Meadows Lease, which was acquired by the Company in conjunction with the acquisition of Pinnacle; (b) ground and levee leases with landlords, which were not assumed by GLPI and remain an obligation of the Company; and (c) buildings and equipment not associated with our Master Leases. For leases where the rate implicit in the lease was not readily determinable, we used our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. We utilized the incremental borrowing rate on the adoption date for operating leases that commenced prior to that date. The operating lease liability is based on the net present value of future lease payments. (6) Amounts primarily represent finance leases associated with Dayton and Mahoning Valley, which are included in the Penn Master Lease, that under ASC 840 utilized specific build-to-suit guidance. The adoption of the new lease standard required the Company to evaluate the components under current guidance contained within the new lease standard, which resulted in all components being classified as finance leases. Finance leases result in (i) the recognition of a finance lease ROU asset amortized over the lease term and (ii) a corresponding finance lease liability (recorded to interest expense over the lease term). We utilized our incremental borrowing rate based on the information available at the adoption date in determining the present value of lease payments. The finance lease liability is based on the net present value of future lease payments. (7) Represents components associated with our Master Leases that remain financing obligations (primarily buildings). The financing obligation at the adoption date was calculated utilizing previous assumptions as determined (a) at the lease commencement date with respect to the Penn Master Lease and (b) at the acquisition date with respect to the Pinnacle Master Lease. (8) Represents the tax impacts related to the adoption of the new lease standard. See Note 13, “Income Taxes.” |
Revenue Disaggregation (Tables)
Revenue Disaggregation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue disaggregation | Our revenue disaggregation by type of revenue and geographic location was as follows: For the year ended December 31, 2019 (in millions) Northeast South West Midwest Other Intersegment Eliminations (1) Total Revenues: Gaming $ 2,117.1 $ 831.1 $ 374.3 $ 938.1 $ 8.8 $ (0.7 ) $ 4,268.7 Food and beverage 155.1 154.1 116.7 84.7 1.4 — 512.0 Hotel 43.5 98.2 125.9 43.4 — — 311.0 Racing 25.1 — 0.6 — 5.6 — 31.3 Other 59.1 35.5 25.0 28.3 31.7 (1.2 ) 178.4 Total revenues $ 2,399.9 $ 1,118.9 $ 642.5 $ 1,094.5 $ 47.5 $ (1.9 ) $ 5,301.4 (1) Represents the elimination of intersegment revenues associated with our internally-branded retail sportsbooks, which are operated by Penn Interactive, and our live and televised poker tournament series that operates under the trademark, Heartland Poker Tour (“HPT”). For the year ended December 31, 2018 (in millions) Northeast South West Midwest Other Total Revenues: Gaming $ 1,644.2 $ 302.9 $ 228.0 $ 719.8 $ — $ 2,894.9 Food and beverage 109.6 56.6 89.6 57.9 1.1 314.8 Hotel 23.2 23.3 90.8 26.3 — 163.6 Racing 20.3 — 0.6 — 5.9 26.8 Reimbursable management costs 46.8 — 10.5 — — 57.3 Other 47.4 11.6 18.4 19.7 33.4 130.5 Total revenues $ 1,891.5 $ 394.4 $ 437.9 $ 823.7 $ 40.4 $ 3,587.9 For the year ended December 31, 2017 (in millions) Northeast South West Midwest Other Total Revenues: Gaming $ 1,583.9 $ 203.0 $ 219.7 $ 685.4 $ — $ 2,692.0 Food and beverage 115.0 35.5 82.4 58.4 1.1 292.4 Hotel 21.5 10.3 76.1 22.0 — 129.9 Racing 49.6 — 2.3 — 10.8 62.7 Reimbursable management costs — — 26.1 — — 26.1 Other 48.7 6.3 16.6 16.4 40.4 128.4 1,818.7 255.1 423.2 782.2 52.3 3,331.5 Less: Promotional allowances (62.1 ) (30.8 ) (42.8 ) (47.2 ) (0.6 ) (183.5 ) Total revenues $ 1,756.6 $ 224.3 $ 380.4 $ 735.0 $ 51.7 $ 3,148.0 |
Acquisitions and Other Invest_2
Acquisitions and Other Investments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations And Other Investments [Abstract] | |
Allocation of purchase price | During the year ended December 31, 2019 , subsequent to the date of acquisition, we made the following adjustments to the preliminary purchase price: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Estimated fair value, as adjusted Cash and cash equivalents $ 31.1 $ — $ 31.1 Receivables, prepaid expenses, and other current assets 15.7 (1.2 ) 14.5 Property and equipment 32.3 (3.9 ) 28.4 Goodwill (2) 61.7 5.7 67.4 Other intangible assets Gaming license 166.4 — 166.4 Trademark 24.4 — 24.4 Customer relationships 3.3 — 3.3 Operating lease right-of-use assets 516.1 — 516.1 Finance lease right-of-use assets 4.1 — 4.1 Other assets 0.2 (0.2 ) — Total assets $ 855.3 $ 0.4 $ 855.7 Accounts payable, accrued expenses and other current liabilities $ 14.8 $ 0.4 15.2 Operating lease liabilities 516.1 — 516.1 Finance lease liabilities 4.1 — 4.1 Total liabilities 535.0 0.4 535.4 Net assets acquired $ 320.3 $ — $ 320.3 (1) Amounts were initially reported within the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2019, filed with the SEC on August 8, 2019. (2) The goodwill has been assigned to our Northeast segment. The entire $67.4 million goodwill amount is deductible for tax purposes. December 31, 2019 , prior to its finalization, we made the following adjustments to the preliminary purchase price allocation: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Fair value, as finalized Cash and cash equivalents $ 10.7 $ — $ 10.7 Receivables, prepaid expenses, and other current assets 7.1 (0.1 ) 7.0 Property and equipment 21.7 (1.0 ) 20.7 Goodwill (2) 39.5 4.7 44.2 Other intangible assets Gaming license 48.1 — 48.1 Customer relationships 2.3 — 2.3 Operating lease right-of-use assets 196.2 — 196.2 Total assets $ 325.6 $ 3.6 $ 329.2 Accounts payable, accrued expenses and other current liabilities $ 9.5 $ 0.6 $ 10.1 Operating lease liabilities 196.2 — 196.2 Total liabilities 205.7 0.6 206.3 Net assets acquired $ 119.9 $ 3.0 $ 122.9 (1) Amounts were initially reported within the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2019, filed with the SEC on May 8, 2019. (2) The goodwill has been assigned to our South segment. The entire $44.2 million goodwill amount is deductible for tax purposes. December 31, 2019 , prior to its finalization, we made the following adjustments to the preliminary purchase price allocation: (in millions) Estimated fair value, as previously reported (1) Measurement period adjustments Fair value, as finalized Cash and restricted cash $ 124.2 $ — $ 124.2 Assets held for sale 667.0 0.5 667.5 Other current assets 80.6 0.5 81.1 Property and equipment - non-Pinnacle Master Lease 318.9 (0.3 ) 318.6 Property and equipment - Pinnacle Master Lease (2) 3,984.1 (29.2 ) 3,954.9 Goodwill (3) 219.5 18.7 238.2 Other intangible assets Gaming licenses 1,046.0 21.6 1,067.6 Trademarks 298.0 — 298.0 Customer relationships 22.4 — 22.4 Other long-term assets 38.9 — 38.9 Total assets $ 6,799.6 $ 11.8 $ 6,811.4 Long-term financing obligation, including current portion (4) $ 3,427.0 $ 5.5 $ 3,432.5 Other current liabilities 200.6 5.5 206.1 Deferred tax liabilities 339.2 0.8 340.0 Other long-term liabilities 16.6 — 16.6 Total liabilities 3,983.4 11.8 3,995.2 Net assets acquired $ 2,816.2 $ — $ 2,816.2 (1) Amounts were initially reported within the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on February 28, 2019. (2) Includes buildings, boats, vessels, barges, and implied land and land use rights. Land use rights represent the intangible value of the Company’s ability to utilize and access land associated with long term ground lease agreements that give the Company the exclusive rights to operate the casino gaming facilities associated with such agreements. (3) See Note 8, “Goodwill and Other Intangible Assets,” for details on the impact to each reportable segment. (4) Long-term financing obligation, including current portion represents the financing obligation associated with Pinnacle Master Lease, as amended. |
Actual and pro forma financial results | The following table includes the financial results of Margaritaville since the acquisition date, which is included within our Consolidated Statement of Income for the year ended December 31, 2019: (in millions) For the year ended December 31, 2019 Revenues $ 157.6 Net income $ 13.7 For the year ended December 31, (in millions) 2019 2018 2017 Revenues $ 5,434.9 $ 5,552.2 $ 5,036.6 Net income (loss) $ 64.9 $ 101.9 $ (38.0 ) The following table includes the financial results of Greektown since the acquisition date, which is included within our Consolidated Statement of Income for the year ended December 31, 2019: (in millions) Period from May 23, 2019 through December 31, 2019 Revenues $ 195.9 Net income $ 10.9 |
Investments in and Advances t_2
Investments in and Advances to Unconsolidated Affiliates (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of summary financial information for Kansas Entertainment | For the year ended December 31, 2019 , our investment in Kansas Entertainment met the requirements to provide summarized balance sheet and income statement information for the comparative periods that are included within our Consolidated Financial Statements: December 31, (in millions) 2019 2018 Current assets $ 21.5 $ 18.3 Long-term assets $ 159.2 $ 161.0 Current liabilities $ 13.5 $ 15.1 For the year ended December 31, (in millions) 2019 2018 2017 Revenues $ 162.3 $ 159.0 $ 155.7 Operating expenses 101.3 110.4 114.7 Operating income 61.0 48.6 41.0 Net income $ 61.0 $ 48.6 $ 41.0 Net income attributable to Penn National $ 30.5 $ 24.3 $ 20.5 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net and depreciation expense | Depreciation of property and equipment is recorded using the straight-line method over the shorter of the estimated useful life of the asset or the related lease term, if any, as follows: Years Land improvements 15 Buildings and improvements 5 to 31 Vessels 10 to 35 Furniture, fixtures and equipment 3 to 31 Property and equipment, net, consisted of the following: December 31, (in millions) 2019 2018 Property and equipment - Not Subject to Master Leases Land and improvements $ 353.2 $ 344.0 Building, vessels and improvements 420.4 343.0 Furniture, fixtures and equipment 1,598.3 1,565.8 Leasehold improvements 183.6 152.9 Construction in progress 59.3 25.5 2,614.8 2,431.2 Less: Accumulated depreciation (1,548.3 ) (1,400.2 ) 1,066.5 1,031.0 Property and equipment - Subject to Master Leases Land and improvements (1) 1,525.9 2,971.0 Building, vessels and improvements (1) 3,664.6 3,845.0 5,190.5 6,816.0 Less: Accumulated depreciation (1,136.8 ) (978.2 ) 4,053.7 5,837.8 Property and equipment, net $ 5,120.2 $ 6,868.8 (1) Upon adoption of ASC 842, approximately $1.4 billion of land was derecognized and replaced with operating lease ROU assets based on the present value of future lease payments and $180.4 million of building and improvements, gross, was derecognized and replaced with finance lease ROU assets based on the present value of future lease payments. See Note 3, “New Accounting Pronouncements.” Depreciation expense was as follows: For the year ended December 31, (in millions) 2019 2018 2017 Depreciation expense (1) $ 381.6 $ 251.9 $ 248.2 (1) Of such amounts, $158.9 million , $112.1 million , and $92.4 million , respectively, pertained to real estate assets subject to either of our Master Leases. |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Details of goodwill | A reconciliation of goodwill and accumulated goodwill impairment losses, by reportable segment, is as follows: (in millions) Northeast South West Midwest Other Total Balance as of January 1, 2018 Goodwill, gross $ 792.0 $ 136.9 $ 159.0 $ 1,046.7 $ 155.3 $ 2,289.9 Accumulated goodwill impairment losses (707.6 ) (34.6 ) (16.6 ) (435.3 ) (87.7 ) (1,281.8 ) Goodwill, net 84.4 102.3 142.4 611.4 67.6 1,008.1 Goodwill acquired during year 56.4 48.3 51.4 63.4 0.8 220.3 Balance as of December 31, 2018 Goodwill, gross 848.4 185.2 210.4 1,110.1 156.1 2,510.2 Accumulated goodwill impairment losses (707.6 ) (34.6 ) (16.6 ) (435.3 ) (87.7 ) (1,281.8 ) Goodwill, net 140.8 150.6 193.8 674.8 68.4 1,228.4 Goodwill acquired during year 67.4 44.2 — — — 111.6 Impairment losses during year (10.3 ) (17.4 ) — (60.3 ) — (88.0 ) Other (1) (1.5 ) 7.2 6.4 6.6 — 18.7 Balance as of December 31, 2019 Goodwill, gross 914.3 236.6 216.8 1,116.7 156.1 2,640.5 Accumulated goodwill impairment losses (717.9 ) (52.0 ) (16.6 ) (495.6 ) (87.7 ) (1,369.8 ) Goodwill, net $ 196.4 $ 184.6 $ 200.2 $ 621.1 $ 68.4 $ 1,270.7 (1) Amounts relate to adjustments made to the preliminary purchase price allocation of Pinnacle during the year ended December 31, 2019 , prior to it being finalized, as described in Note 5, “Acquisitions and Other Investments” As of October 1, 2019, the date of the most recent annual impairment test, three reporting units had negative carrying amounts. The amount of goodwill at these reporting units was as follows (in millions): Northeast segment Hollywood Casino at Charles Town Races $ 8.7 Plainridge Park Casino $ 6.3 Midwest segment Ameristar Council Bluffs $ 36.2 |
Schedule of indefinite-lived intangible assets | The table below presents the gross carrying amount, accumulated amortization, and net carrying amount of each major class of other intangible assets: December 31, 2019 December 31, 2018 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Indefinite-lived intangible assets Gaming licenses $ 1,681.9 $ — $ 1,681.9 $ 1,498.3 $ — $ 1,498.3 Trademarks 302.4 — 302.4 298.0 — 298.0 Other 0.7 — 0.7 0.7 — 0.7 Amortizing intangible assets Customer relationships 104.4 (69.0 ) 35.4 98.8 (51.5 ) 47.3 Other 36.1 (30.0 ) 6.1 61.9 (49.3 ) 12.6 Total other intangible assets $ 2,125.5 $ (99.0 ) $ 2,026.5 $ 1,957.7 $ (100.8 ) $ 1,856.9 |
Schedule of finite-lived intangible assets | The table below presents the gross carrying amount, accumulated amortization, and net carrying amount of each major class of other intangible assets: December 31, 2019 December 31, 2018 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Indefinite-lived intangible assets Gaming licenses $ 1,681.9 $ — $ 1,681.9 $ 1,498.3 $ — $ 1,498.3 Trademarks 302.4 — 302.4 298.0 — 298.0 Other 0.7 — 0.7 0.7 — 0.7 Amortizing intangible assets Customer relationships 104.4 (69.0 ) 35.4 98.8 (51.5 ) 47.3 Other 36.1 (30.0 ) 6.1 61.9 (49.3 ) 12.6 Total other intangible assets $ 2,125.5 $ (99.0 ) $ 2,026.5 $ 1,957.7 $ (100.8 ) $ 1,856.9 |
Expected intangible asset amortization expense | The following table presents the estimated amortization expense based on our amortizing intangible assets as of December 31, 2019 (in millions): Years ending December 31: 2020 $ 19.7 2021 5.8 2022 3.9 2023 3.6 2024 3.6 Thereafter 4.9 Total $ 41.5 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of the following: December 31, (in millions) 2019 2018 Accrued salaries and wages $ 142.1 $ 139.2 Accrued gaming, pari-mutuel, property, and other taxes 103.3 105.8 Accrued interest 13.0 15.8 Other accrued expenses (1) 225.8 204.6 Other current liabilities (2) 147.1 112.6 Accrued expenses and other current liabilities $ 631.3 $ 578.0 (1) Amounts include $38.3 million and $33.8 million , respectively, pertaining to the Company’s accrued progressive jackpot liability. Additionally, amounts include the obligation associated with our my choice program and the current portion of advance payments on goods and services yet to be provided and for unpaid wagers, which are discussed in Note 2, “Significant Accounting Policies.” (2) Amounts include $80.1 million and $64.1 million |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt, net of current maturities | Long-term debt, net of current maturities, was as follows: December 31, (in millions) 2019 2018 Senior Secured Credit Facilities: Revolving Credit Facility due 2023 $ 140.0 $ 112.0 Term Loan A Facility due 2023 672.3 707.7 Term Loan B-1 Facility due 2025 1,117.5 1,128.7 5.625% Notes due 2027 400.0 400.0 Other long-term obligations 89.2 104.6 Capital leases (1) — 0.4 2,419.0 2,453.4 Less: Current maturities of long-term debt (62.9 ) (62.1 ) Less: Debt discount (2.4 ) (2.8 ) Less: Debt issuance costs (31.5 ) (38.4 ) $ 2,322.2 $ 2,350.1 (1) Reclassified to finance lease liabilities upon the adoption of ASC 842. |
Schedule of future minimum repayments of long-term debt | The following is a schedule of future minimum repayments of long-term debt as of December 31, 2019 (in millions): Year ending December 31: 2020 $ 62.9 2021 81.4 2022 99.9 2023 683.1 2024 21.3 Thereafter 1,470.4 Total minimum payments $ 2,419.0 |
Schedule of interest expense, net | Interest expense, net Interest expense, net, was as follows: For the year ended December 31, (in millions) 2019 2018 2017 Interest expense $ (535.9 ) $ (539.4 ) $ (467.0 ) Interest income 1.4 1.0 3.6 Capitalized interest 0.3 — 0.2 Interest expense, net $ (534.2 ) $ (538.4 ) $ (463.2 ) |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Expense, other information and supplemental cash flow information related to leases | Supplemental cash flow information related to leases was as follows: (in millions) For the year ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 15.4 Operating cash flows from operating leases $ 403.6 Financing cash flows from finance leases $ 6.2 Information related to lease term and discount rate was as follows: December 31, 2019 Weighted-Average Remaining Lease Term Operating leases 27.6 years Finance leases 28.6 years Financing obligations 30.4 years Weighted-Average Discount Rate Operating leases 6.7 % Finance leases 6.8 % Financing obligations 8.1 % The components of lease expense were as follows: Classification (in millions) Gaming Expense Food, Beverage, Hotel and Other Expense General and Administrative Interest Expense, net Depreciation and Amortization Total for the year ended December 31, 2019 Operating Lease Costs Rent expense associated with triple net leases classified as operating leases (1) $ — $ — $ 366.4 $ — $ — $ 366.4 Operating lease cost (2) 0.4 0.5 16.6 — — 17.5 Short-term lease cost 53.8 1.3 1.5 — — 56.6 Variable lease cost (2) 2.8 — 1.1 — — 3.9 Total $ 57.0 $ 1.8 $ 385.6 $ — $ — $ 444.4 Finance Lease Costs Interest expense (3) $ — $ — $ — $ 15.4 $ — $ 15.4 Amortization expense (3) — — — — 7.9 7.9 Total $ — $ — $ — $ 15.4 $ 7.9 $ 23.3 Financing Obligation Costs Interest expense (4) $ — $ — $ — $ 394.1 $ — $ 394.1 (1) Pertains to the components contained within the Master Leases (primarily land) determined to be operating leases, the Meadows Lease, the Margaritaville Lease, and the Greektown Lease, inclusive of the variable expense associated with Columbus and Toledo for the operating lease components (the land) (see table above). (2) Excludes the operating lease costs and variable lease costs pertaining to our triple net leases with our REIT landlords classified as operating leases, discussed in footnote (1) above. (3) Primarily pertains to the Dayton and Mahoning Valley finance leases. (4) Pertains to the components contained within the Master Leases (primarily buildings) determined to continue to be financing obligations, inclusive of the variable expense associated with Columbus and Toledo for the finance lease components (the buildings) (see table above). For the year ended December 31, (in millions) 2019 2018 2017 Variable expenses included in “General and administrative” $ 16.4 $ — $ — Variable expenses included in “Interest expense, net” 16.1 48.9 46.8 Total variable expenses $ 32.5 $ 48.9 $ 46.8 |
Schedule of future minimum lease commitments, operating leases | The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 |
Schedule of future minimum lease commitments, finance leases | The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 |
Schedule of future minimum lease commitments, financing obligations | The following is a maturity analysis of our operating leases, finance leases and financing obligations as of December 31, 2019 : (in millions) Operating Leases Finance Leases Financing Obligations Years ending December 31: 2020 $ 424.0 $ 21.7 $ 374.7 2021 403.7 21.7 367.3 2022 400.6 21.6 367.3 2023 397.5 20.8 367.3 2024 381.0 16.7 367.3 Thereafter 8,153.3 393.5 9,270.6 Total lease payments 10,160.1 496.0 11,114.5 Less: Imputed interest (5,585.4 ) (270.1 ) (6,971.8 ) Present value of future lease payments 4,574.7 225.9 4,142.7 Less: Current portion of lease obligations (124.1 ) (6.5 ) (40.5 ) Long-term portion of lease obligations $ 4,450.6 $ 219.4 $ 4,102.2 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Components of deferred tax assets and liabilities | The components of the Company’s deferred tax assets and liabilities were as follows: December 31, (in millions) 2019 2018 Deferred tax assets: Stock-based compensation expense $ 11.7 $ 9.0 Accrued expenses 37.6 42.9 Financing obligations associated with the Master Leases 1,097.6 1,919.7 Unrecognized tax benefits 7.7 6.7 Investments in and advances to unconsolidated affiliates — 3.6 Net operating losses, interest limitation and tax credit carryforwards 87.6 122.8 Gross deferred tax assets 1,242.2 2,104.7 Less: Valuation allowance (54.2 ) (89.5 ) Net deferred tax assets 1,188.0 2,015.2 Deferred tax liabilities: Property and equipment, not subject to the Master Leases (53.1 ) (47.3 ) Property and equipment, subject to the Master Leases (1,088.9 ) (1,599.9 ) Investments in and advances to unconsolidated affiliates (2.9 ) — Undistributed foreign earnings (0.4 ) (0.4 ) Intangible assets (287.3 ) (287.0 ) Net deferred tax liabilities (1,432.6 ) (1,934.6 ) Long-term deferred tax assets (liabilities), net $ (244.6 ) $ 80.6 |
Components of income before income tax expense | The domestic and foreign components of income (loss) before income taxes for the years ended December 31, 2019 , 2018 and 2017 were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Domestic $ 85.5 $ 89.6 $ (29.6 ) Foreign 0.6 0.3 4.5 Total $ 86.1 $ 89.9 $ (25.1 ) |
Schedule of provision for income taxes | The components of income tax benefit (expense) for the years ended December 31, 2019 , 2018 and 2017 were as follows: For the year ended December 31, (in millions) 2019 2018 2017 Current tax benefit (expense) Federal $ (12.5 ) $ (15.3 ) $ (16.3 ) State (9.2 ) (6.4 ) (6.1 ) Foreign (0.2 ) (1.4 ) 3.0 Total current (21.9 ) (23.1 ) (19.4 ) Deferred tax benefit (expense) Federal (16.7 ) 14.6 480.7 State (4.4 ) 10.9 39.3 Foreign — 1.2 (2.1 ) Total deferred (21.1 ) 26.7 517.9 Total income tax benefit (expense) $ (43.0 ) $ 3.6 $ 498.5 |
Reconciliation of the statutory federal income tax rate to the actual effective income tax rate | The following table reconciles the statutory federal income tax rate to the actual effective income tax rate, and related amounts of income tax benefit (expense), for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, 2019 2018 2017 (in millions, except tax rates) Percent Amount Percent Amount Percent Amount Percent and amount of pretax income Federal statutory rate 21.0 % $ (18.1 ) 21.0 % $ (18.9 ) 35.0 % $ 8.8 State and local income taxes, net of federal benefits 9.9 (8.5 ) (6.2 ) 5.6 6.3 1.6 Nondeductible expenses 4.0 (3.5 ) 6.9 (6.2 ) (16.0 ) (4.0 ) Goodwill impairment losses 14.4 (12.4 ) — — (20.5 ) (5.1 ) Compensation 0.3 (0.3 ) (3.8 ) 3.4 29.5 7.4 Contingent liability settlement — — — — 22.9 5.7 Foreign 0.1 (0.1 ) (0.1 ) 0.1 11.3 2.8 Valuation allowance — — (20.3 ) 18.3 2,962.3 741.9 Tax Act - deferred rate change — — — — (1,043.5 ) (261.3 ) Other 0.2 (0.1 ) (1.5 ) 1.3 3.3 0.7 Total effective tax rate and income tax benefit (expense) 49.9 % $ (43.0 ) (4.0 )% $ 3.6 1,990.6 % $ 498.5 |
Reconciliation of unrecognized tax benefits | A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows: (in millions) Unrecognized tax benefits Unrecognized tax benefits as of January 1, 2017 $ 26.8 Additions based on current year positions 2.9 Additions based on prior year positions 2.8 Decreases due to settlements and/or reduction in reserves (1.3 ) Currency translation adjustments (0.1 ) Settlement payments (0.2 ) Unrecognized tax benefits as of December 31, 2017 30.9 Additions based on prior year positions 0.8 Decreases due to settlements and/or reduction in reserves (2.0 ) Unrecognized tax benefits as of December 31, 2018 29.7 Additions based on prior year positions 6.5 Decreases due to settlements and/or reduction in reserves (0.2 ) Unrecognized tax benefits as of December 31, 2019 $ 36.0 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Information on stock options issued | The following table contains information about our stock options: Number of Option Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in millions) Outstanding as of January 1, 2019 5,869,211 $ 15.14 Granted 2,436,811 $ 19.24 Exercised (230,644 ) $ 14.32 Forfeited (257,942 ) $ 19.44 Outstanding as of December 31, 2019 7,817,436 $ 16.30 4.84 $ 75.1 Exercisable as of December 31, 2019 4,071,052 $ 13.62 2.49 $ 49.2 |
Information about stock options by exercise price range | The following table summarizes information about our outstanding stock options as of December 31, 2019 : Exercise Price Range Total $11.61 to $17.77 to $30.74 to $11.61 to Outstanding options Number outstanding 4,842,725 2,368,886 605,825 7,817,436 Weighted-average remaining contractual term (in years) 2.66 9.27 4.95 4.84 Weighted-average exercise price $ 13.06 $ 19.23 $ 30.75 $ 16.30 Exercisable options Number outstanding 3,901,333 10,584 159,135 4,071,052 Weighted-average exercise price $ 12.91 $ 18.62 $ 30.75 $ 13.62 |
Weighted-average assumptions used in Black-Scholes option pricing model | The following are the weighted-average assumptions used in the Black-Scholes option-pricing model for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, 2019 2018 2017 Risk-free interest rate 2.00 % 2.26 % 1.97 % Expected volatility 32.90 % 30.80 % 30.66 % Dividend yield — — — Weighted-average expected life (in years) 5.30 5.30 5.30 |
Information on restricted stock awards | The following table contains information on our RSAs: With Performance Conditions Without Performance Conditions Number of Shares Weighted- Average Grant Date Fair Value Number of Shares Weighted- Average Grant Date Fair Value Nonvested as of January 1, 2019 351,472 $ 22.10 207,349 $ 25.55 Granted 253,609 $ 23.55 175,795 $ 19.44 Vested (193,799 ) $ 19.36 (35,758 ) $ 18.05 Forfeited (15,920 ) $ 22.60 (48,907 ) $ 23.71 Nonvested as of December 31, 2019 395,362 $ 24.35 298,479 $ 23.15 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the weighted-average common shares outstanding | The following table reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, (in millions) 2019 2018 2017 Determination of shares: Weighted-average common shares outstanding 115.7 97.1 90.9 Assumed conversion of dilutive stock options 1.8 3.0 2.4 Assumed conversion of dilutive restricted stock awards 0.3 0.2 0.1 Diluted weighted-average common shares outstanding 117.8 100.3 93.4 |
Schedule of calculation of basic and diluted EPS | The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the years ended December 31, 2019 , 2018 and 2017 : For the year ended December 31, (in millions, except per share data) 2019 2018 2017 Calculation of basic EPS: Net income applicable to common stock $ 43.9 $ 93.5 $ 473.4 Weighted-average common shares outstanding 115.7 97.1 90.9 Basic EPS $ 0.38 $ 0.96 $ 5.21 Calculation of diluted EPS: Net income applicable to common stock 43.9 93.5 473.4 Diluted weighted-average common shares outstanding 117.8 100.3 93.4 Diluted EPS $ 0.37 $ 0.93 $ 5.07 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment information | For financial reporting purposes, we aggregate our operating segments into the following four reportable segments: Location Real Estate Assets Lease or Ownership Structure Northeast segment Ameristar East Chicago East Chicago, Indiana Pinnacle Master Lease Greektown Casino-Hotel (1) Detroit, Michigan Greektown Lease Hollywood Casino Bangor Bangor, Maine Penn Master Lease Hollywood Casino at Charles Town Races Charles Town, West Virginia Penn Master Lease Hollywood Casino Columbus Columbus, Ohio Penn Master Lease Hollywood Casino Lawrenceburg Lawrenceburg, Indiana Penn Master Lease Hollywood Casino at Penn National Race Course Grantville, Pennsylvania Penn Master Lease Hollywood Casino Toledo Toledo, Ohio Penn Master Lease Hollywood Gaming at Dayton Raceway Dayton, Ohio Penn Master Lease Hollywood Gaming at Mahoning Valley Race Course Youngstown, Ohio Penn Master Lease Marquee by Penn (2) Pennsylvania N/A Meadows Racetrack and Casino Washington, Pennsylvania Meadows Lease Plainridge Park Casino Plainville, Massachusetts Pinnacle Master Lease South segment (3) 1 st Jackpot Casino Tunica, Mississippi Penn Master Lease Ameristar Vicksburg Vicksburg, Mississippi Pinnacle Master Lease Boomtown Biloxi Biloxi, Mississippi Penn Master Lease Boomtown Bossier City Bossier City, Louisiana Pinnacle Master Lease Boomtown New Orleans New Orleans, Louisiana Pinnacle Master Lease Hollywood Casino Gulf Coast Bay St. Louis, Mississippi Penn Master Lease Hollywood Casino Tunica Tunica, Mississippi Penn Master Lease L’Auberge Baton Rouge Baton Rouge, Louisiana Pinnacle Master Lease L’Auberge Lake Charles Lake Charles, Louisiana Pinnacle Master Lease Margaritaville Resort Casino (4) Bossier City, Louisiana Margaritaville Lease West segment Ameristar Black Hawk Black Hawk, Colorado Pinnacle Master Lease Cactus Petes and Horseshu Jackpot, Nevada Pinnacle Master Lease M Resort Henderson, Nevada Penn Master Lease Tropicana Las Vegas Las Vegas, Nevada Owned Zia Park Casino Hobbs, New Mexico Penn Master Lease Midwest segment Ameristar Council Bluffs Council Bluffs, Iowa Pinnacle Master Lease Argosy Casino Alton (5) Alton, Illinois Penn Master Lease Argosy Casino Riverside Riverside, Missouri Penn Master Lease Hollywood Casino Aurora Aurora, Illinois Penn Master Lease Hollywood Casino Joliet Joliet, Illinois Penn Master Lease Hollywood Casino at Kansas Speedway (6) Kansas City, Kansas Owned - JV Hollywood Casino St. Louis Maryland Heights, Missouri Penn Master Lease Prairie State Gaming (2) Illinois N/A River City Casino St. Louis, Missouri Pinnacle Master Lease (1) Acquired on May 23, 2019 (2) VGT route operations (3) Resorts Casino Tunica ceased operations on June 30, 2019, but remains subject to the Penn Master Lease. (4) Acquired on January 1, 2019 (5) The riverboat is owned by us and not subject to the Penn Master Lease. (6) Pursuant to a joint venture (“JV”) with International Speedway Corporation (“International Speedway”) and includes the Company’s 50% investment in Kansas Entertainment, LLC (“Kansas Entertainment”), which owns Hollywood Casino at Kansas Speedway. Adjusted EBITDAR for each reportable segment and reconciles Adjusted EBITDAR on a consolidated basis to Net income. For the year ended December 31, (in millions) 2019 2018 2017 Revenues: Northeast segment $ 2,399.9 $ 1,891.5 $ 1,756.6 South segment 1,118.9 394.4 224.3 West segment 642.5 437.9 380.4 Midwest segment 1,094.5 823.7 735.0 Other (1) 47.5 40.4 51.7 Intersegment eliminations (2) (1.9 ) — — Total $ 5,301.4 $ 3,587.9 $ 3,148.0 Adjusted EBITDAR (3) : Northeast segment $ 720.8 $ 583.8 $ 549.3 South segment 369.8 118.9 62.6 West segment 198.8 114.3 72.7 Midwest segment 403.6 294.3 249.7 Other (1) (87.8 ) (68.1 ) (55.2 ) Total (3) 1,605.2 1,043.2 879.1 Other operating benefits (costs) and other income (expenses): Rent expense associated with triple net operating leases (4) (366.4 ) (3.8 ) — Stock-based compensation (14.9 ) (12.0 ) (7.8 ) Cash-settled stock-based awards variance (0.8 ) 19.6 (23.4 ) Loss on disposal of assets (5.5 ) (3.2 ) (0.2 ) Contingent purchase price (7.0 ) (0.5 ) 6.8 Pre-opening and acquisition costs (22.3 ) (95.0 ) (9.7 ) Depreciation and amortization (414.2 ) (269.0 ) (267.1 ) Impairment losses (173.1 ) (34.9 ) (18.0 ) Recoveries on (provision for) loan loss and unfunded loan commitments — 17.0 (89.8 ) Insurance recoveries, net of deductible charges 3.0 0.1 0.3 Non-operating items for Kansas JV (3.7 ) (5.1 ) (5.8 ) Interest expense, net (534.2 ) (538.4 ) (463.2 ) Loss on early extinguishment of debt — (21.0 ) (24.0 ) Other 20.0 (7.1 ) (2.3 ) Income before income taxes 86.1 89.9 (25.1 ) Income tax benefit (expense) (43.0 ) 3.6 498.5 Net income $ 43.1 $ 93.5 $ 473.4 (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, and iGaming; 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. (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 charges; 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 (such as depreciation and amortization) added back for our JV in Kansas Entertainment. (4) The Company’s triple net operating leases include certain components of the Master Leases (primarily land), the Meadows Lease, the Margaritaville Lease, and the Greektown Lease. For the year ended December 31, (in millions) 2019 2018 2017 Capital expenditures: Northeast segment $ 96.2 $ 38.9 $ 26.3 South segment 29.8 10.6 6.3 West segment 21.2 12.8 35.7 Midwest segment 32.7 25.3 26.2 Other 10.7 5.0 4.8 Total capital expenditures $ 190.6 $ 92.6 $ 99.3 (in millions) Northeast South West Midwest Other Total As of December 31, 2019 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 90.9 $ 37.3 $ 128.3 Total assets (1) $ 2,273.7 $ 1,397.0 $ 752.1 $ 1,412.2 $ 8,359.5 $ 14,194.5 As of December 31, 2018 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 89.4 $ 39.0 $ 128.5 Total assets (2) $ 1,330.2 $ 1,082.3 $ 755.7 $ 1,411.5 $ 6,381.3 $ 10,961.0 As of December 31, 2017 Investment in and advances to unconsolidated affiliates $ 0.1 $ — $ — $ 88.3 $ 60.5 $ 148.9 Total assets (2) $ 921.0 $ 169.3 $ 625.0 $ 970.8 $ 2,548.7 $ 5,234.8 (1) As of December 31, 2019 , total assets of the Other category includes the real estate assets subject to the Master Leases, which are either classified as property and equipment, operating lease ROU assets, or finance lease ROU assets, depending on whether the underlying component of the Master Leases was determined to be an operating lease, a finance lease, or continue to be financing obligations, upon adoption of ASC 842. (2) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of carrying amounts and estimated fair values by input level | The carrying amounts and estimated fair values by input level of the Company’s financial instruments were as follows: December 31, 2019 (in millions) Carrying Amount Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 437.4 $ 437.4 $ 437.4 $ — $ — Equity securities $ 40.5 $ 40.5 $ — $ 40.5 $ — Held-to-maturity securities $ 6.7 $ 6.7 $ — $ 6.7 $ — Promissory notes $ 15.1 $ 15.1 $ — $ 15.1 $ — Financial liabilities: Long-term debt Senior Secured Credit Facilities $ 1,896.5 $ 1,930.6 $ 1,930.6 $ — $ — 5.625% Notes $ 399.4 $ 426.0 $ 426.0 $ — $ — Other long-term obligations $ 89.2 $ 89.7 $ — $ 89.7 $ — Other liabilities $ 20.3 $ 20.3 $ — $ 2.8 $ 17.5 December 31, 2018 (in millions) Carrying Amount Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 479.6 $ 479.6 $ 479.6 $ — $ — Held-to-maturity securities $ 7.5 $ 7.9 $ — $ 7.9 $ — Promissory notes $ 16.9 $ 17.4 $ — $ 17.4 $ — Financial liabilities: Long-term debt Senior Secured Credit Facilities $ 1,907.9 $ 1,886.3 $ 1,886.3 $ — $ — 5.625% Notes $ 399.3 $ 360.0 $ 360.0 $ — $ — Other long-term obligations $ 104.6 $ 96.3 $ — $ 96.3 $ — Other liabilities $ 21.9 $ 21.8 $ — $ 2.8 $ 19.0 |
Summary of the changes in fair value of Level 3 liabilities | The following table summarizes the changes in fair value of our Level 3 liabilities measured on a recurring basis: Other Liabilities (in millions) Contingent Purchase Price Balance as of January 1, 2017 $ 48.2 Additions 0.9 Payments (19.6 ) Included in earnings (1) (6.8 ) Balance as of December 31, 2017 22.7 Payments (4.2 ) Included in earnings (1) 0.5 Balance as of December 31, 2018 19.0 Payments (8.5 ) Included in earnings (1) 7.0 Balance as of December 31, 2019 $ 17.5 (1) The expense is included in “General and administrative” within our Consolidated Statements of Income. |
Schedule of the assets measured at fair value on a non-recurring basis | The following table sets forth the assets measured at fair value on a non-recurring basis during the years ended December 31, 2019 and 2018 : (in millions) Valuation Date Valuation Technique Level 1 Level 2 Level 3 Total Balance Total Reduction in Fair Value Recorded Goodwill 10/1/2019 Discounted cash flow and market approach $ — $ — $ 161.1 $ 161.1 $ (88.0 ) Gaming licenses 10/1/2019 Discounted cash flow $ — $ — $ 290.0 $ 290.0 $ (62.6 ) Trademarks 10/1/2019 Discounted cash flow $ — $ — $ 87.5 $ 87.5 $ (20.0 ) Property and equipment (1) 12/31/2018 Cost and market approach $ — $ — $ — $ — $ (34.3 ) (1) The fair value, which was concluded to be zero, of our property and equipment associated with Resorts Casino Tunica was determined using Level 2 inputs. See Note 7, “Property and Equipment” for more information. |
Summary of significant unobservable inputs used in fair value calculations | The following table presents quantitative information about the significant unobservable inputs used in the fair value measurements of other indefinite-lived intangible assets as of the valuation date below: (in millions) Fair Value Valuation Technique Unobservable Input Range or Amount As of October 1, 2019 Gaming licenses $ 290.0 Discounted cash flow Discount rate 10.5% - 11.25% Long-term revenue growth rate 2.0 % Trademarks $ 87.5 Discounted cash flow Discount rate 10.5% - 11.25% Long-term revenue growth rate 2.0 % Pretax royalty rate 1.0% - 2.0% The following table summarizes the significant unobservable inputs used in calculating fair value for our Level 3 liabilities on a recurring basis as of December 31, 2019 : Valuation Technique Unobservable Input Discount Rate Plainridge Park Casino contingent purchase price Discounted cash flow Discount rate 5.63% |
Summarized Quarterly Data (Un_2
Summarized Quarterly Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | The following table summarizes the quarterly results of operations for the years ended December 31, 2019 and 2018 : Fiscal Quarter (in millions, except per share data) First Second Third Fourth (1) 2019 Revenues $ 1,282.6 $ 1,323.1 $ 1,354.5 $ 1,341.2 Operating income $ 182.4 $ 198.4 $ 179.8 $ 11.3 Net income (loss) $ 41.0 $ 51.3 $ 43.7 $ (92.9 ) Earnings (loss) per common share: Basic earnings (loss) per common share $ 0.35 $ 0.44 $ 0.38 $ (0.80 ) Diluted earnings (loss) per common share $ 0.35 $ 0.44 $ 0.38 $ (0.80 ) Fiscal Quarter (in millions, except per share data) First Second (2) Third Fourth (3) 2018 Revenues $ 816.1 $ 826.9 $ 789.7 $ 1,155.3 Operating income $ 172.1 $ 181.8 $ 155.8 $ 124.4 Net income (loss) $ 45.4 $ 54.0 $ 36.1 $ (42.0 ) Earnings (loss) per common share: Basic earnings (loss) per common share $ 0.50 $ 0.59 $ 0.39 $ (0.37 ) Diluted earnings (loss) per common share $ 0.48 $ 0.57 $ 0.38 $ (0.37 ) (1) During the fourth quarter of 2019, we recorded $170.6 million of impairment on our goodwill and other intangible assets. See Note 8, “Goodwill and Other Intangible Assets,” for further details. (2) During the second quarter of 2018, the Company recorded a recovery of loan losses and unfunded loan commitments of $17.0 million relating to the JIVDC. See Note 5, “Acquisitions and Other Investments,” for further details. (3) During the fourth quarter of 2018, we acquired Pinnacle, which resulted in the incurrence of $74.7 million in pre-opening and acquisition costs. See Note 5, “Acquisitions and Other Investments,” for further details. In addition, we recorded a $34.3 million impairment of long-lived assets. See Note 7, “Property and Equipment,” for further details. Lastly, we recorded a $17.2 million loss on early extinguishment of debt. See Note 10, “Long-term Debt,” |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Details) | Oct. 15, 2018property | Dec. 31, 2019jurisdictionproperty |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of facilities the entity owned, managed, or had ownership interests in | 41 | |
Number of jurisdictions in which the entity operates | jurisdiction | 19 | |
Pinnacle | ||
Business Acquisition [Line Items] | ||
Number of properties acquired | 12 |
Significant Accounting Polici_4
Significant Accounting Policies - Segment Information (Details) | 12 Months Ended | |
Dec. 31, 2019facilitysegment | Dec. 31, 2018 | |
Segment Information | ||
Number of reportable segments | 4 | |
Kansas Entertainment | ||
Segment Information | ||
Ownership interest | 50.00% | 50.00% |
Jackpot, Nevada | ||
Segment Information | ||
Number of facilities the entity owned, managed, or had ownership interests in | facility | 2 | |
Number of operating segments | 1 |
Significant Accounting Polici_5
Significant Accounting Policies - Concentration of Credit Risk and Receivables (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Allowance for doubtful accounts | $ (7.7) | $ (3.2) |
Accounts receivable, net | 88.7 | 106.8 |
Markers issued to customers | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 22.9 | 17.2 |
Credit card receivables and other advances to customers | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 16.5 | 20.9 |
Receivables from ATM and cash kiosk transactions | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 14.4 | 19.2 |
Hotel and banquet receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 6.5 | 8.1 |
Racing settlements | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 6.6 | 6.1 |
Receivables due from platform providers for social casino games | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | 3.3 | 2.3 |
Other | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables, gross | $ 26.2 | $ 36.2 |
Significant Accounting Polici_6
Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Land improvements | |
Estimated useful lives of property and equipment | |
Useful lives | 15 years |
Building and improvements | Minimum | |
Estimated useful lives of property and equipment | |
Useful lives | 5 years |
Building and improvements | Maximum | |
Estimated useful lives of property and equipment | |
Useful lives | 31 years |
Vessels | Minimum | |
Estimated useful lives of property and equipment | |
Useful lives | 10 years |
Vessels | Maximum | |
Estimated useful lives of property and equipment | |
Useful lives | 35 years |
Furniture, fixtures and equipment | Minimum | |
Estimated useful lives of property and equipment | |
Useful lives | 3 years |
Furniture, fixtures and equipment | Maximum | |
Estimated useful lives of property and equipment | |
Useful lives | 31 years |
Significant Accounting Polici_7
Significant Accounting Policies - Equity Securities (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Accounting Policies [Abstract] | |
Holding gain on equity securities | $ 19.9 |
Significant Accounting Polici_8
Significant Accounting Policies - Financing Obligations (Details) | Oct. 15, 2018 | Nov. 01, 2013 |
Penn Master Lease | ||
Capital Leased Assets [Line Items] | ||
Lease term | 35 years | |
Discount rate | 9.70% | |
Pinnacle Master Lease | ||
Capital Leased Assets [Line Items] | ||
Discount rate | 7.30% | |
Remaining lease term | 32 years 6 months | |
Effective yield | 9.60% |
Significant Accounting Polici_9
Significant Accounting Policies - Revenue Recognition (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2019agreement | |
Revenue from External Customer [Line Items] | ||||
Total complimentaries associated with gaming contracts | $ 438.6 | $ 206.1 | ||
Revenue recognized | $ 0.6 | |||
Loyalty credit obligation | ||||
Revenue from External Customer [Line Items] | ||||
Customer-related liabilities, current | 36.2 | $ 36.2 | 39.9 | |
Contract with customer, term | 6 months | |||
Advance payments on goods and services yet to be provided or unpaid wagers | ||||
Revenue from External Customer [Line Items] | ||||
Customer-related liabilities | 42.2 | $ 42.2 | 34.3 | |
Customer-related liabilities, long-term | 0.6 | $ 0.6 | 0.7 | |
Virtual playing credits | ||||
Revenue from External Customer [Line Items] | ||||
Redemption period over which revenue is recognized | three days | |||
Food and beverage | ||||
Revenue from External Customer [Line Items] | ||||
Total complimentaries associated with gaming contracts | $ 261.4 | 137.2 | ||
Hotel | ||||
Revenue from External Customer [Line Items] | ||||
Total complimentaries associated with gaming contracts | 159.6 | 60.8 | ||
Other | ||||
Revenue from External Customer [Line Items] | ||||
Total complimentaries associated with gaming contracts | 17.6 | $ 8.1 | ||
Online sports betting and related iGaming market access | ||||
Revenue from External Customer [Line Items] | ||||
Customer-related liabilities, long-term | $ 43.6 | $ 43.6 | ||
Number of operator agreements for which ordinary shares and warrants received | agreement | 3 |
Significant Accounting Polic_10
Significant Accounting Policies - Gaming and Racing Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||
Gaming taxes | $ 1,590 | $ 1,102.3 | $ 983.3 |
Significant Accounting Polic_11
Significant Accounting Policies - Stock-Based Compensation (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
New Accounting Pronouncements_2
New Accounting Pronouncements (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets | |||||
Prepaid expenses | $ 76.7 | $ 62 | $ 63 | ||
Total current assets | 642.8 | 676.6 | 677.6 | ||
Property and equipment, net | 5,120.2 | 5,297.1 | 6,868.8 | ||
Other assets | |||||
Goodwill | 1,270.7 | 1,233.9 | 1,228.4 | $ 1,008.1 | |
Operating lease right-of-use assets | 4,613.3 | 3,806.5 | 0 | ||
Finance lease right-of-use assets | 224 | 224.5 | 0 | ||
Total assets | 14,194.5 | 13,424.8 | 10,961 | 5,234.8 | |
Current liabilities | |||||
Current portion of financing obligations | 40.5 | 50.1 | 67.8 | ||
Current portion of operating lease liabilities | 124.1 | 102.3 | 0 | ||
Current portion of finance lease liabilities | 6.5 | 5.8 | 0 | ||
Accrued expenses and other current liabilities | 631.3 | 577.5 | 578 | ||
Total current liabilities | 905.6 | 828.3 | 738.4 | ||
Long-term portion of financing obligations | 4,102.2 | 4,144.2 | 7,080.6 | ||
Long-term portion of lease obligations | 4,450.6 | 3,704.4 | 0 | ||
Long-term portion of lease obligations | 219.4 | 218.3 | 0 | ||
Deferred income taxes | 244.6 | 303.8 | 0 | ||
Other long-term liabilities | 98 | 58.8 | 60.7 | ||
Total liabilities | 12,342.6 | 11,607.9 | 10,229.8 | ||
Retained earnings (accumulated deficit) | 161.6 | 117.7 | (968) | ||
Total Penn stockholders’ equity | 1,852.7 | 1,816.9 | 731.2 | ||
Total stockholders’ equity | 1,851.9 | 1,816.9 | 731.2 | $ (73.3) | $ (543.4) |
Total liabilities and stockholders’ equity | $ 14,194.5 | 13,424.8 | $ 10,961 | ||
ASC 842 | |||||
Current assets | |||||
Prepaid expenses | (1) | ||||
Total current assets | (1) | ||||
Property and equipment, net | (1,571.7) | ||||
Other assets | |||||
Goodwill | 5.5 | ||||
Operating lease right-of-use assets | 3,806.5 | ||||
Finance lease right-of-use assets | 224.5 | ||||
Total assets | 2,463.8 | ||||
Current liabilities | |||||
Current portion of financing obligations | (17.7) | ||||
Current portion of operating lease liabilities | 102.3 | ||||
Current portion of finance lease liabilities | 5.8 | ||||
Accrued expenses and other current liabilities | (0.5) | ||||
Total current liabilities | 89.9 | ||||
Long-term portion of financing obligations | (2,936.4) | ||||
Long-term portion of lease obligations | 3,704.4 | ||||
Long-term portion of lease obligations | 218.3 | ||||
Deferred income taxes | 303.8 | ||||
Other long-term liabilities | (1.9) | ||||
Total liabilities | 1,378.1 | ||||
Retained earnings (accumulated deficit) | 1,085.7 | ||||
Total Penn stockholders’ equity | 1,085.7 | ||||
Total stockholders’ equity | 1,085.7 | ||||
Total liabilities and stockholders’ equity | 2,463.8 | ||||
Financing Obligations - Master Leases | |||||
Current assets | |||||
Prepaid expenses | 0 | ||||
Total current assets | 0 | ||||
Property and equipment, net | 0 | ||||
Other assets | |||||
Goodwill | 5.5 | ||||
Operating lease right-of-use assets | 0 | ||||
Finance lease right-of-use assets | 0 | ||||
Total assets | 5.5 | ||||
Current liabilities | |||||
Current portion of financing obligations | 0 | ||||
Current portion of operating lease liabilities | 0 | ||||
Current portion of finance lease liabilities | 0 | ||||
Accrued expenses and other current liabilities | 0 | ||||
Total current liabilities | 0 | ||||
Long-term portion of financing obligations | 5.5 | ||||
Long-term portion of lease obligations | 0 | ||||
Long-term portion of lease obligations | 0 | ||||
Deferred income taxes | 0 | ||||
Other long-term liabilities | 0 | ||||
Total liabilities | 5.5 | ||||
Retained earnings (accumulated deficit) | 0 | ||||
Total Penn stockholders’ equity | 0 | ||||
Total stockholders’ equity | 0 | ||||
Total liabilities and stockholders’ equity | 5.5 | ||||
Finance Leases - Dayton and Mahoning Valley | |||||
Current assets | |||||
Prepaid expenses | 0 | ||||
Total current assets | 0 | ||||
Property and equipment, net | (164.3) | ||||
Other assets | |||||
Goodwill | 0 | ||||
Operating lease right-of-use assets | 0 | ||||
Finance lease right-of-use assets | 224.5 | ||||
Total assets | 60.2 | ||||
Current liabilities | |||||
Current portion of financing obligations | (1.5) | ||||
Current portion of operating lease liabilities | 0 | ||||
Current portion of finance lease liabilities | 5.8 | ||||
Accrued expenses and other current liabilities | 0 | ||||
Total current liabilities | 4.3 | ||||
Long-term portion of financing obligations | (181.3) | ||||
Long-term portion of lease obligations | 0 | ||||
Long-term portion of lease obligations | 218.3 | ||||
Deferred income taxes | 4.3 | ||||
Other long-term liabilities | 0 | ||||
Total liabilities | 45.6 | ||||
Retained earnings (accumulated deficit) | 14.6 | ||||
Total Penn stockholders’ equity | 14.6 | ||||
Total stockholders’ equity | 14.6 | ||||
Total liabilities and stockholders’ equity | 60.2 | ||||
Operating Leases - Master Leases | |||||
Current assets | |||||
Prepaid expenses | 0 | ||||
Total current assets | 0 | ||||
Property and equipment, net | (1,407.4) | ||||
Other assets | |||||
Goodwill | 0 | ||||
Operating lease right-of-use assets | 3,541.2 | ||||
Finance lease right-of-use assets | 0 | ||||
Total assets | 2,133.8 | ||||
Current liabilities | |||||
Current portion of financing obligations | (16.2) | ||||
Current portion of operating lease liabilities | 72.9 | ||||
Current portion of finance lease liabilities | 0 | ||||
Accrued expenses and other current liabilities | 0 | ||||
Total current liabilities | 56.7 | ||||
Long-term portion of financing obligations | (2,760.6) | ||||
Long-term portion of lease obligations | 3,467.1 | ||||
Long-term portion of lease obligations | 0 | ||||
Deferred income taxes | 299.5 | ||||
Other long-term liabilities | 0 | ||||
Total liabilities | 1,062.7 | ||||
Retained earnings (accumulated deficit) | 1,071.1 | ||||
Total Penn stockholders’ equity | 1,071.1 | ||||
Total stockholders’ equity | 1,071.1 | ||||
Total liabilities and stockholders’ equity | 2,133.8 | ||||
Operating Lease - Meadows | |||||
Current assets | |||||
Prepaid expenses | 0 | ||||
Total current assets | 0 | ||||
Property and equipment, net | 0 | ||||
Other assets | |||||
Goodwill | 0 | ||||
Operating lease right-of-use assets | 112.8 | ||||
Finance lease right-of-use assets | 0 | ||||
Total assets | 112.8 | ||||
Current liabilities | |||||
Current portion of financing obligations | 0 | ||||
Current portion of operating lease liabilities | 20.5 | ||||
Current portion of finance lease liabilities | 0 | ||||
Accrued expenses and other current liabilities | 0 | ||||
Total current liabilities | 20.5 | ||||
Long-term portion of financing obligations | 0 | ||||
Long-term portion of lease obligations | 92.3 | ||||
Long-term portion of lease obligations | 0 | ||||
Deferred income taxes | 0 | ||||
Other long-term liabilities | 0 | ||||
Total liabilities | 112.8 | ||||
Retained earnings (accumulated deficit) | 0 | ||||
Total Penn stockholders’ equity | 0 | ||||
Total stockholders’ equity | 0 | ||||
Total liabilities and stockholders’ equity | 112.8 | ||||
Other Operating Leases - Non-Master Leases | |||||
Current assets | |||||
Prepaid expenses | (1) | ||||
Total current assets | (1) | ||||
Property and equipment, net | 0 | ||||
Other assets | |||||
Goodwill | 0 | ||||
Operating lease right-of-use assets | 152.5 | ||||
Finance lease right-of-use assets | 0 | ||||
Total assets | 151.5 | ||||
Current liabilities | |||||
Current portion of financing obligations | 0 | ||||
Current portion of operating lease liabilities | 8.9 | ||||
Current portion of finance lease liabilities | 0 | ||||
Accrued expenses and other current liabilities | (0.5) | ||||
Total current liabilities | 8.4 | ||||
Long-term portion of financing obligations | 0 | ||||
Long-term portion of lease obligations | 145 | ||||
Long-term portion of lease obligations | 0 | ||||
Deferred income taxes | 0 | ||||
Other long-term liabilities | (1.9) | ||||
Total liabilities | 151.5 | ||||
Retained earnings (accumulated deficit) | 0 | ||||
Total Penn stockholders’ equity | 0 | ||||
Total stockholders’ equity | 0 | ||||
Total liabilities and stockholders’ equity | $ 151.5 |
Revenue Disaggregation (Details
Revenue Disaggregation (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 5,301.4 | $ 3,587.9 | $ 3,331.5 | ||||||||
Less: Promotional allowance | 0 | 0 | (183.5) | ||||||||
Total revenues | $ 1,341.2 | $ 1,354.5 | $ 1,323.1 | $ 1,282.6 | $ 1,155.3 | $ 789.7 | $ 826.9 | $ 816.1 | 5,301.4 | 3,587.9 | 3,148 |
Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 4,268.7 | 2,894.9 | 2,692 | ||||||||
Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 512 | 314.8 | 292.4 | ||||||||
Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 311 | 163.6 | 129.9 | ||||||||
Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 31.3 | 26.8 | 62.7 | ||||||||
Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 57.3 | 26.1 | |||||||||
Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 178.4 | 130.5 | 128.4 | ||||||||
Operating segments | Northeast segment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 2,399.9 | 1,891.5 | 1,818.7 | ||||||||
Less: Promotional allowance | (62.1) | ||||||||||
Total revenues | 2,399.9 | 1,891.5 | 1,756.6 | ||||||||
Operating segments | Northeast segment | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 2,117.1 | 1,644.2 | 1,583.9 | ||||||||
Operating segments | Northeast segment | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 155.1 | 109.6 | 115 | ||||||||
Operating segments | Northeast segment | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 43.5 | 23.2 | 21.5 | ||||||||
Operating segments | Northeast segment | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 25.1 | 20.3 | 49.6 | ||||||||
Operating segments | Northeast segment | Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 46.8 | 0 | |||||||||
Operating segments | Northeast segment | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 59.1 | 47.4 | 48.7 | ||||||||
Operating segments | South segment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 1,118.9 | 394.4 | 255.1 | ||||||||
Less: Promotional allowance | (30.8) | ||||||||||
Total revenues | 1,118.9 | 394.4 | 224.3 | ||||||||
Operating segments | South segment | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 831.1 | 302.9 | 203 | ||||||||
Operating segments | South segment | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 154.1 | 56.6 | 35.5 | ||||||||
Operating segments | South segment | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 98.2 | 23.3 | 10.3 | ||||||||
Operating segments | South segment | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Operating segments | South segment | Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
Operating segments | South segment | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 35.5 | 11.6 | 6.3 | ||||||||
Operating segments | West segment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 642.5 | 437.9 | 423.2 | ||||||||
Less: Promotional allowance | (42.8) | ||||||||||
Total revenues | 642.5 | 437.9 | 380.4 | ||||||||
Operating segments | West segment | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 374.3 | 228 | 219.7 | ||||||||
Operating segments | West segment | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 116.7 | 89.6 | 82.4 | ||||||||
Operating segments | West segment | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 125.9 | 90.8 | 76.1 | ||||||||
Operating segments | West segment | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0.6 | 0.6 | 2.3 | ||||||||
Operating segments | West segment | Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 10.5 | 26.1 | |||||||||
Operating segments | West segment | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 25 | 18.4 | 16.6 | ||||||||
Operating segments | Midwest segment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 1,094.5 | 823.7 | 782.2 | ||||||||
Less: Promotional allowance | (47.2) | ||||||||||
Total revenues | 1,094.5 | 823.7 | 735 | ||||||||
Operating segments | Midwest segment | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 938.1 | 719.8 | 685.4 | ||||||||
Operating segments | Midwest segment | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 84.7 | 57.9 | 58.4 | ||||||||
Operating segments | Midwest segment | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 43.4 | 26.3 | 22 | ||||||||
Operating segments | Midwest segment | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Operating segments | Midwest segment | Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
Operating segments | Midwest segment | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 28.3 | 19.7 | 16.4 | ||||||||
Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 47.5 | 40.4 | 52.3 | ||||||||
Less: Promotional allowance | (0.6) | ||||||||||
Total revenues | 47.5 | 40.4 | 51.7 | ||||||||
Other | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 8.8 | 0 | 0 | ||||||||
Other | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 1.4 | 1.1 | 1.1 | ||||||||
Other | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | 0 | ||||||||
Other | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 5.6 | 5.9 | 10.8 | ||||||||
Other | Reimbursable management costs | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | 0 | |||||||||
Other | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 31.7 | 33.4 | 40.4 | ||||||||
Intersegment eliminations | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | (1.9) | ||||||||||
Total revenues | (1.9) | $ 0 | $ 0 | ||||||||
Intersegment eliminations | Gaming | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | (0.7) | ||||||||||
Intersegment eliminations | Food and beverage | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | ||||||||||
Intersegment eliminations | Hotel | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | ||||||||||
Intersegment eliminations | Racing | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 0 | ||||||||||
Intersegment eliminations | Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ (1.2) |
Acquisitions and Other Invest_3
Acquisitions and Other Investments - Additional Information (Details) $ / shares in Units, $ in Millions | May 23, 2019USD ($)renewal_option | Jan. 01, 2019USD ($)renewal_option | Oct. 15, 2018USD ($)property$ / shares | May 01, 2017USD ($) | Aug. 31, 2016USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Business Acquisition [Line Items] | ||||||||
Proceeds from sale-and-leaseback transactions in conjunction with acquisitions | $ 961.1 | $ 0 | $ 0 | |||||
Proceeds from the sale of real estate assets in conjunction with acquisitions | $ 250 | 82.6 | ||||||
Greektown Casino-Hotel | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price | $ 320.3 | |||||||
Proceeds from sale-and-leaseback transactions in conjunction with acquisitions | $ 700 | |||||||
Weighted average amortization period of amortizing intangible assets acquired | 2 years | |||||||
Margaritaville Resort Casino | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price | $ 122.9 | |||||||
Annual rent | $ 23.2 | |||||||
Operating lease, term | 15 years | |||||||
Operating lease, number of lease renewal terms | renewal_option | 4 | |||||||
Liabilities incurred on acquisition | $ 261.1 | |||||||
Margaritaville Resort Casino | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Weighted average amortization period of amortizing intangible assets acquired | 2 years | |||||||
Pinnacle | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price | $ 2,816.2 | |||||||
Liabilities incurred on acquisition | $ 814.3 | |||||||
Cash paid per share (in dollars per share) | $ / shares | $ 20 | |||||||
Cash consideration | $ 1,252.2 | |||||||
Fair value of Penn common stock issued to former Pinnacle shareholders | $ 749.7 | |||||||
Number of properties acquired | property | 12 | |||||||
1st Jackpot Casino | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration | $ 47 | |||||||
Proceeds from the sale of real estate assets in conjunction with acquisitions | $ 82.6 | |||||||
Rocket Speed | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration | $ 60.5 | |||||||
Percentage acquired | 100.00% | |||||||
Contingent consideration, period | 2 years | |||||||
Multiple applied to then-trailing 12 months of EBITDA to determine contingent consideration | 6.25 | |||||||
Contingent consideration, cap | $ 110 | |||||||
Contingent consideration (up to) | 34.4 | |||||||
Benefit from buyout of contingent purchase price consideration | $ 22.2 | |||||||
Rocket Speed | Employee retention compensation | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration (up to) | $ 10 | |||||||
Greektown Lease | ||||||||
Business Acquisition [Line Items] | ||||||||
Annual rent | $ 55.6 | |||||||
Operating lease, term | 15 years | |||||||
Operating lease, number of lease renewal terms | renewal_option | 4 | |||||||
Lease renewal term | 5 years | |||||||
Margaritaville Lease | ||||||||
Business Acquisition [Line Items] | ||||||||
Operating lease, term | 15 years | |||||||
Operating lease, number of lease renewal terms | renewal_option | 4 | |||||||
Lease renewal term | 5 years |
Acquisitions and Other Invest_4
Acquisitions and Other Investments - Allocation of Purchase Price (Details) - USD ($) $ in Millions | 7 Months Ended | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2019 | May 23, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Oct. 15, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 1,270.7 | $ 1,270.7 | $ 1,233.9 | $ 1,228.4 | $ 1,008.1 | ||
Greektown Casino-Hotel | |||||||
Business Acquisition [Line Items] | |||||||
Cash and cash equivalents | 31.1 | 31.1 | $ 31.1 | ||||
Receivables, prepaid expenses, and other current assets | 14.5 | 14.5 | 15.7 | ||||
Property and equipment | 28.4 | 28.4 | 32.3 | ||||
Goodwill | 67.4 | 67.4 | 61.7 | ||||
Operating lease right-of-use assets | 516.1 | 516.1 | 516.1 | ||||
Finance lease right-of-use assets | 4.1 | 4.1 | 4.1 | ||||
Other long-term assets | 0 | 0 | 0.2 | ||||
Total assets | 855.7 | 855.7 | 855.3 | ||||
Accounts payable, accrued expenses and other current liabilities | 15.2 | 15.2 | 14.8 | ||||
Operating lease liabilities | 516.1 | 516.1 | 516.1 | ||||
Finance lease liabilities | 4.1 | 4.1 | 4.1 | ||||
Total liabilities | 535.4 | 535.4 | 535 | ||||
Net assets acquired | 320.3 | 320.3 | 320.3 | ||||
Goodwill tax deductible amount | 67.4 | ||||||
Measurement period adjustments | |||||||
Receivables, prepaid expenses, and other current assets | (1.2) | ||||||
Property and equipment | (3.9) | ||||||
Goodwill | 5.7 | ||||||
Other assets | (0.2) | ||||||
Total assets | 0.4 | ||||||
Accounts payable, accrued expenses and other current liabilities | 0.4 | ||||||
Total liabilities | 0.4 | ||||||
Net assets acquired | 0 | ||||||
Greektown Casino-Hotel | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Amortizing intangible assets | 3.3 | 3.3 | 3.3 | ||||
Greektown Casino-Hotel | Gaming licenses | |||||||
Business Acquisition [Line Items] | |||||||
Indefinite-lived intangible assets | 166.4 | 166.4 | 166.4 | ||||
Greektown Casino-Hotel | Trademarks | |||||||
Business Acquisition [Line Items] | |||||||
Indefinite-lived intangible assets | 24.4 | 24.4 | $ 24.4 | ||||
Margaritaville Resort Casino | |||||||
Business Acquisition [Line Items] | |||||||
Cash and cash equivalents | 10.7 | 10.7 | 10.7 | ||||
Receivables, prepaid expenses, and other current assets | 7 | 7 | 7.1 | ||||
Property and equipment | 20.7 | 20.7 | 21.7 | ||||
Goodwill | 44.2 | 44.2 | 39.5 | ||||
Operating lease right-of-use assets | 196.2 | 196.2 | 196.2 | ||||
Total assets | 329.2 | 329.2 | 325.6 | ||||
Accounts payable, accrued expenses and other current liabilities | 10.1 | 10.1 | 9.5 | ||||
Operating lease liabilities | 196.2 | 196.2 | 196.2 | ||||
Total liabilities | 206.3 | 206.3 | 205.7 | ||||
Net assets acquired | 122.9 | 122.9 | 119.9 | ||||
Goodwill tax deductible amount | 44.2 | ||||||
Measurement period adjustments | |||||||
Receivables, prepaid expenses, and other current assets | (0.1) | ||||||
Property and equipment | (1) | ||||||
Goodwill | 4.7 | ||||||
Total assets | 3.6 | ||||||
Accounts payable, accrued expenses and other current liabilities | 0.6 | ||||||
Total liabilities | 0.6 | ||||||
Net assets acquired | 3 | ||||||
Margaritaville Resort Casino | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Amortizing intangible assets | 2.3 | 2.3 | 2.3 | ||||
Margaritaville Resort Casino | Gaming licenses | |||||||
Business Acquisition [Line Items] | |||||||
Indefinite-lived intangible assets | 48.1 | 48.1 | $ 48.1 | ||||
Pinnacle | |||||||
Business Acquisition [Line Items] | |||||||
Cash and restricted cash | 124.2 | 124.2 | $ 124.2 | ||||
Assets held for sale | 667.5 | 667.5 | 667 | ||||
Other current assets | 81.1 | 81.1 | 80.6 | ||||
Goodwill | 238.2 | 238.2 | 219.5 | ||||
Other long-term assets | 38.9 | 38.9 | 38.9 | ||||
Total assets | 6,811.4 | 6,811.4 | 6,799.6 | ||||
Long-term financing obligation, including current portion | 3,432.5 | 3,432.5 | 3,427 | ||||
Other current liabilities | 206.1 | 206.1 | 200.6 | ||||
Deferred tax liabilities | 340 | 340 | 339.2 | ||||
Other long-term liabilities | 16.6 | 16.6 | 16.6 | ||||
Total liabilities | 3,995.2 | 3,995.2 | 3,983.4 | ||||
Net assets acquired | 2,816.2 | 2,816.2 | 2,816.2 | ||||
Measurement period adjustments | |||||||
Assets held for sale | 0.5 | ||||||
Receivables, prepaid expenses, and other current assets | 0.5 | ||||||
Goodwill | 18.7 | ||||||
Total assets | 11.8 | ||||||
Long-term financing obligation, including current portion | 5.5 | ||||||
Other current liabilities | 5.5 | ||||||
Deferred tax liabilities | 0.8 | ||||||
Total liabilities | 11.8 | ||||||
Net assets acquired | 0 | ||||||
Pinnacle | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Amortizing intangible assets | 22.4 | 22.4 | 22.4 | ||||
Pinnacle | Gaming licenses | |||||||
Business Acquisition [Line Items] | |||||||
Indefinite-lived intangible assets | 1,067.6 | 1,067.6 | 1,046 | ||||
Measurement period adjustments | |||||||
Indefinite-lived intangible assets | 21.6 | ||||||
Pinnacle | Trademarks | |||||||
Business Acquisition [Line Items] | |||||||
Indefinite-lived intangible assets | 298 | 298 | 298 | ||||
Property and equipment - Not Subject to Master Leases | Pinnacle | |||||||
Business Acquisition [Line Items] | |||||||
Property and equipment | 318.6 | 318.6 | 318.9 | ||||
Measurement period adjustments | |||||||
Property and equipment | (0.3) | ||||||
Property and equipment - Subject to Master Leases | Pinnacle | |||||||
Business Acquisition [Line Items] | |||||||
Property and equipment | $ 3,954.9 | 3,954.9 | $ 3,984.1 | ||||
Measurement period adjustments | |||||||
Property and equipment | $ (29.2) |
Acquisitions and Other Invest_5
Acquisitions and Other Investments - Actual and Pro Forma Financial Results (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Pro forma financial results | |||
Revenues | $ 5,434.9 | $ 5,552.2 | $ 5,036.6 |
Net income (loss) | 64.9 | $ 101.9 | $ (38) |
Greektown Casino-Hotel | |||
Actual financial results of acquiree since acquisition date | |||
Revenues | 195.9 | ||
Net income | 10.9 | ||
Margaritaville Resort Casino | |||
Actual financial results of acquiree since acquisition date | |||
Revenues | 157.6 | ||
Net income | $ 13.7 |
Acquisitions and Other Invest_6
Acquisitions and Other Investments - Jamul Indian Village Development Corporation (Details) - USD ($) | May 25, 2018 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Oct. 31, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | $ 0 | $ (17,000,000) | $ 89,800,000 | |||
Proceeds from sale of loan | $ 0 | 15,200,000 | 0 | |||
JIVDC | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | $ (17,000,000) | $ (17,000,000) | 86,000,000 | |||
Charges for certain advances | 3,800,000 | |||||
Proceeds from sale of loan | $ 15,200,000 | |||||
JIVDC | Secured credit facility | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Maximum borrowing capacity under credit facilities | $ 460,000,000 | |||||
JIVDC | Secured credit facility | Term loan C facility | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Maximum borrowing capacity under credit facilities | $ 98,000,000 | |||||
Term loan C facility | JIVDC | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | 64,000,000 | |||||
Unfunded loan commitments | JIVDC | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | $ 22,000,000 |
Investments in and Advances t_3
Investments in and Advances to Unconsolidated Affiliates (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | |||
Return on investment from unconsolidated affiliates | $ 29 | $ 27 | $ 26.5 |
Summary financial information | |||
Net income attributable to Penn National | $ 28.4 | $ 22.3 | 18.7 |
Kansas Entertainment | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest | 50.00% | 50.00% | |
Investment balance | $ 90.8 | $ 89.4 | |
Return on investment from unconsolidated affiliates | 29 | 27 | 26 |
Summary financial information | |||
Current assets | 21.5 | 18.3 | |
Long-term assets | 159.2 | 161 | |
Current liabilities | 13.5 | 15.1 | |
Revenues | 162.3 | 159 | 155.7 |
Operating expenses | 101.3 | 110.4 | 114.7 |
Operating income | 61 | 48.6 | 41 |
Net income | 61 | 48.6 | 41 |
Net income attributable to Penn National | $ 30.5 | $ 24.3 | $ 20.5 |
Freehold Raceway | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest | 50.00% | ||
MAXXAM | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership interest | 50.00% |
Property and Equipment - Proper
Property and Equipment - Property and Equipment, Net (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | $ 5,120.2 | $ 5,297.1 | $ 6,868.8 |
Operating Leases - Master Leases | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | (1,407.4) | ||
Finance Leases - Dayton and Mahoning Valley | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | (164.3) | ||
Property and equipment - Not Subject to Master Leases | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 2,614.8 | 2,431.2 | |
Less: Accumulated depreciation | (1,548.3) | (1,400.2) | |
Property and equipment, net | 1,066.5 | 1,031 | |
Land and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 353.2 | 344 | |
Building, vessels and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 420.4 | 343 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 1,598.3 | 1,565.8 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 183.6 | 152.9 | |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 59.3 | 25.5 | |
Property and equipment - Subject to Master Leases | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 5,190.5 | 6,816 | |
Less: Accumulated depreciation | (1,136.8) | (978.2) | |
Property and equipment, net | 4,053.7 | 5,837.8 | |
Land and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 1,525.9 | 2,971 | |
Land and improvements | Operating Leases - Master Leases | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | (1,400) | ||
Building, vessels and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 3,664.6 | $ 3,845 | |
Building, vessels and improvements | Finance Leases - Dayton and Mahoning Valley | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ (180.4) |
Property and Equipment - Deprec
Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 381.6 | $ 251.9 | $ 248.2 |
Property and equipment - Subject to Master Leases | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 158.9 | $ 112.1 | $ 92.4 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2018 |
Property, Plant and Equipment [Abstract] | |||
Impairment on property and equipment | $ 34.3 | $ 34.3 | $ 34.3 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Goodwill and Accumulated Goodwill Impairment Losses (Details) - USD ($) | Oct. 01, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | $ 2,510,200,000 | $ 2,289,900,000 | |
Accumulated goodwill impairment losses, beginning balance | (1,281,800,000) | (1,281,800,000) | |
Goodwill, net, beginning balance | 1,228,400,000 | 1,008,100,000 | |
Goodwill acquired during year | 111,600,000 | 220,300,000 | |
Impairment losses during year | $ (88,000,000) | (88,000,000) | 0 |
Other | 18,700,000 | ||
Goodwill, gross, ending balance | 2,640,500,000 | 2,510,200,000 | |
Accumulated goodwill impairment losses, ending balance | (1,369,800,000) | (1,281,800,000) | |
Goodwill, net, ending balance | 1,270,700,000 | 1,228,400,000 | |
Northeast segment | |||
Goodwill [Roll Forward] | |||
Impairment losses during year | (10,300,000) | ||
South segment | |||
Goodwill [Roll Forward] | |||
Impairment losses during year | (17,400,000) | ||
Midwest segment | |||
Goodwill [Roll Forward] | |||
Impairment losses during year | (60,300,000) | ||
Operating segments | Northeast segment | |||
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | 848,400,000 | 792,000,000 | |
Accumulated goodwill impairment losses, beginning balance | (707,600,000) | (707,600,000) | |
Goodwill, net, beginning balance | 140,800,000 | 84,400,000 | |
Goodwill acquired during year | 67,400,000 | 56,400,000 | |
Impairment losses during year | (10,300,000) | ||
Other | (1,500,000) | ||
Goodwill, gross, ending balance | 914,300,000 | 848,400,000 | |
Accumulated goodwill impairment losses, ending balance | (717,900,000) | (707,600,000) | |
Goodwill, net, ending balance | 196,400,000 | 140,800,000 | |
Operating segments | South segment | |||
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | 185,200,000 | 136,900,000 | |
Accumulated goodwill impairment losses, beginning balance | (34,600,000) | (34,600,000) | |
Goodwill, net, beginning balance | 150,600,000 | 102,300,000 | |
Goodwill acquired during year | 44,200,000 | 48,300,000 | |
Impairment losses during year | (17,400,000) | ||
Other | 7,200,000 | ||
Goodwill, gross, ending balance | 236,600,000 | 185,200,000 | |
Accumulated goodwill impairment losses, ending balance | (52,000,000) | (34,600,000) | |
Goodwill, net, ending balance | 184,600,000 | 150,600,000 | |
Operating segments | West segment | |||
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | 210,400,000 | 159,000,000 | |
Accumulated goodwill impairment losses, beginning balance | (16,600,000) | (16,600,000) | |
Goodwill, net, beginning balance | 193,800,000 | 142,400,000 | |
Goodwill acquired during year | 0 | 51,400,000 | |
Impairment losses during year | 0 | ||
Other | 6,400,000 | ||
Goodwill, gross, ending balance | 216,800,000 | 210,400,000 | |
Accumulated goodwill impairment losses, ending balance | (16,600,000) | (16,600,000) | |
Goodwill, net, ending balance | 200,200,000 | 193,800,000 | |
Operating segments | Midwest segment | |||
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | 1,110,100,000 | 1,046,700,000 | |
Accumulated goodwill impairment losses, beginning balance | (435,300,000) | (435,300,000) | |
Goodwill, net, beginning balance | 674,800,000 | 611,400,000 | |
Goodwill acquired during year | 0 | 63,400,000 | |
Impairment losses during year | (60,300,000) | ||
Other | 6,600,000 | ||
Goodwill, gross, ending balance | 1,116,700,000 | 1,110,100,000 | |
Accumulated goodwill impairment losses, ending balance | (495,600,000) | (435,300,000) | |
Goodwill, net, ending balance | 621,100,000 | 674,800,000 | |
Other | |||
Goodwill [Roll Forward] | |||
Goodwill, gross, beginning balance | 156,100,000 | 155,300,000 | |
Accumulated goodwill impairment losses, beginning balance | (87,700,000) | (87,700,000) | |
Goodwill, net, beginning balance | 68,400,000 | 67,600,000 | |
Goodwill acquired during year | 0 | 800,000 | |
Impairment losses during year | 0 | ||
Other | 0 | ||
Goodwill, gross, ending balance | 156,100,000 | 156,100,000 | |
Accumulated goodwill impairment losses, ending balance | (87,700,000) | (87,700,000) | |
Goodwill, net, ending balance | $ 68,400,000 | $ 68,400,000 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Reporting Units With Negative Carrying Values (Details) $ in Millions | Oct. 01, 2019USD ($) |
Northeast segment | Hollywood Casino at Charles Town Races | |
Goodwill [Line Items] | |
Reporting unit with negative carrying amount, goodwill | $ 8.7 |
Northeast segment | Plainridge Park Casino | |
Goodwill [Line Items] | |
Reporting unit with negative carrying amount, goodwill | 6.3 |
Midwest segment | Ameristar Council Bluffs | |
Goodwill [Line Items] | |
Reporting unit with negative carrying amount, goodwill | $ 36.2 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets, accumulated amortization | $ (99) | $ (100.8) |
Amortizing intangible assets, net carrying amount | 41.5 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Total other intangible assets, gross carrying amount | 2,125.5 | 1,957.7 |
Total other intangible assets, net carrying amount | 2,026.5 | 1,856.9 |
Gaming licenses | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 1,681.9 | 1,498.3 |
Trademarks | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 302.4 | 298 |
Other | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 0.7 | 0.7 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets, gross carrying amount | 104.4 | 98.8 |
Amortizing intangible assets, accumulated amortization | (69) | (51.5) |
Amortizing intangible assets, net carrying amount | 35.4 | 47.3 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortizing intangible assets, gross carrying amount | 36.1 | 61.9 |
Amortizing intangible assets, accumulated amortization | (30) | (49.3) |
Amortizing intangible assets, net carrying amount | $ 6.1 | $ 12.6 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Expected Intangible Asset Amortization Expense (Details) $ in Millions | Dec. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 19.7 |
2021 | 5.8 |
2022 | 3.9 |
2023 | 3.6 |
2024 | 3.6 |
Thereafter | 4.9 |
Amortizing intangible assets, net carrying amount | $ 41.5 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Additional Information (Details) | Oct. 01, 2019USD ($)reporting_unit | Sep. 30, 2017USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | $ 88,000,000 | $ 88,000,000 | $ 0 | ||
Impairment of other intangible assets | 0 | $ 0 | |||
Number of reporting units with negative carrying values | reporting_unit | 3 | ||||
Purchase of intangible assets | 11,700,000 | 81,600,000 | 1,600,000 | ||
Intangible asset amortization expense | 24,700,000 | 17,100,000 | $ 18,900,000 | ||
Tropicana Las Vegas | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | $ 14,800,000 | ||||
Sanford Orlando Kennel Club | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | $ 3,200,000 | ||||
Northeast segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | 10,300,000 | ||||
South segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | 17,400,000 | ||||
Midwest segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of goodwill | 60,300,000 | ||||
Gaming licenses | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 62,600,000 | ||||
Gaming licenses | Pennsylvania | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Purchase of intangible assets | 10,000,000 | 20,000,000 | |||
Gaming licenses | York County, Pennsylvania | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Purchase of intangible assets | 50,100,000 | ||||
Gaming licenses | Berks County, Pennsylvania | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Purchase of intangible assets | $ 7,500,000 | ||||
Gaming licenses | Northeast segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 55,100,000 | ||||
Gaming licenses | South segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 7,500,000 | ||||
Trademarks | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 20,000,000 | ||||
Trademarks | Northeast segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 11,500,000 | ||||
Trademarks | South segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | 6,500,000 | ||||
Trademarks | Midwest segment | |||||
Schedule Of Goodwill And Intangible Assets [Line Items] | |||||
Impairment of other intangible assets | $ 2,000,000 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | |||
Accrued salaries and wages | $ 142.1 | $ 139.2 | |
Accrued gaming, pari-mutuel, property, and other taxes | 103.3 | 105.8 | |
Accrued interest | 13 | 15.8 | |
Other accrued expenses | 225.8 | 204.6 | |
Other current liabilities | 147.1 | 112.6 | |
Accrued expenses and other current liabilities | 631.3 | $ 577.5 | 578 |
Accrued progressive jackpot liability | 38.3 | 33.8 | |
Deferred compensation liability, current | $ 80.1 | $ 64.1 |
Long-term Debt - Debt Summary (
Long-term Debt - Debt Summary (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 19, 2017 |
Debt Instrument [Line Items] | |||
Long-term debt | $ 2,419 | $ 2,453.4 | |
Less: Current maturities of long-term debt | (62.9) | (62.1) | |
Less: Debt discount | (2.4) | (2.8) | |
Less: Debt issuance costs | (31.5) | (38.4) | |
Long-term debt, net of current maturities and debt issuance costs | $ 2,322.2 | 2,350.1 | |
Interest rate | 5.625% | ||
Secured credit facility | Revolving Credit Facility due 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 140 | 112 | |
Secured credit facility | Term Loan A Facility due 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 672.3 | 707.7 | |
Secured credit facility | Term Loan B-1 Facility due 2025 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 1,117.5 | 1,128.7 | |
Senior notes | 5.625% Notes due 2027 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 400 | 400 | |
Interest rate | 5.625% | 5.625% | |
Other long-term obligations | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 89.2 | 104.6 | |
Capital leases | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 0 | $ 0.4 |
Long-term Debt - Debt Maturitie
Long-term Debt - Debt Maturities (Details) $ in Millions | Dec. 31, 2019USD ($) |
Year ending December 31: | |
2020 | $ 62.9 |
2021 | 81.4 |
2022 | 99.9 |
2023 | 683.1 |
2024 | 21.3 |
Thereafter | 1,470.4 |
Total minimum payments | $ 2,419 |
Long-term Debt - Senior Secured
Long-term Debt - Senior Secured Credit Facilities (Details) - USD ($) | Oct. 15, 2018 | Jan. 19, 2017 | Oct. 30, 2013 | Dec. 31, 2019 | Dec. 31, 2018 | Aug. 31, 2015 |
Debt Instrument [Line Items] | ||||||
Interest rate | 5.625% | |||||
Pinnacle 5.625% senior notes due 2024 | Senior notes | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 5.625% | |||||
Secured credit facility | 2013 Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Maximum borrowing capacity | $ 500,000,000 | $ 633,200,000 | ||||
Secured credit facility | 2013 Term Loan A Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Maximum borrowing capacity | $ 500,000,000 | |||||
Secured credit facility | 2013 Term Loan B Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 7 years | |||||
Maximum borrowing capacity | $ 250,000,000 | $ 646,700,000 | ||||
Secured credit facility | 2013 Term Loan B Facility | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 2.50% | |||||
Secured credit facility | 2013 Term Loan B Facility | Base rate | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.50% | |||||
Secured credit facility | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Maximum borrowing capacity | $ 700,000,000 | |||||
Letters of credit outstanding | $ 30,000,000 | $ 30,000,000 | ||||
Available borrowing capacity | $ 530,000,000 | 558,000,000 | ||||
Secured credit facility | Term Loan A Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Maximum borrowing capacity | $ 300,000,000 | |||||
Secured credit facility | Term Loan B Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 7 years | |||||
Maximum borrowing capacity | $ 500,000,000 | |||||
Secured credit facility | Term Loan A Facility due 2023, incremental loans | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 430,200,000 | |||||
Secured credit facility | Term Loan B-1 Facility due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 1,128,800,000 | |||||
Variable interest rate floor | 0.75% | |||||
Secured credit facility | Term Loan B-1 Facility due 2025 | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 2.25% | |||||
Secured credit facility | Term Loan B-1 Facility due 2025 | Base rate | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.25% | |||||
Secured credit facility | Term Loan A Facility due 2023 | LIBOR | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 1.25% | |||||
Secured credit facility | Term Loan A Facility due 2023 | LIBOR | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 3.00% | |||||
Secured credit facility | Term Loan A Facility due 2023 | Base rate | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 0.25% | |||||
Secured credit facility | Term Loan A Facility due 2023 | Base rate | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable interest rate | 2.00% | |||||
Secured credit facility | Revolving Credit Facility due 2023 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Unused commitment fee percentage | 0.20% | |||||
Secured credit facility | Revolving Credit Facility due 2023 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Unused commitment fee percentage | 0.50% | |||||
Secured credit facility | Senior Secured Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Refinancing costs | 5,500,000 | |||||
Loss on early extinguishment of debt | 21,000,000 | |||||
Secured credit facility | 2013 Senior Secured Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Refinancing costs | 1,700,000 | |||||
Loss on early extinguishment of debt | $ 2,300,000 |
Long-term Debt - 5.625% Senior
Long-term Debt - 5.625% Senior Unsecured Notes and Covenants (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2017 | Jan. 19, 2017 |
Debt Instrument [Line Items] | |||
Interest rate | 5.625% | ||
Senior notes | 5.875% senior subordinated notes due 2021 | |||
Debt Instrument [Line Items] | |||
Interest rate | 5.875% | ||
Senior notes | 5.625% Notes due 2027 | |||
Debt Instrument [Line Items] | |||
Debt principal amount | $ 400,000,000 | ||
Interest rate | 5.625% | 5.625% |
Long-term Debt - Redemption of
Long-term Debt - Redemption of 5.875% Senior Subordinated Notes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Extinguishment of Debt [Line Items] | ||||
Interest rate | 5.625% | |||
Loss on early extinguishment of debt | $ 17.2 | $ 0 | $ 21 | $ 24 |
Senior notes | 5.875% senior subordinated notes due 2021 | ||||
Extinguishment of Debt [Line Items] | ||||
Interest rate | 5.875% | |||
Debt redemption amount | $ 300 | |||
Loss on early extinguishment of debt | $ 21.1 |
Long-term Debt - Interest Expen
Long-term Debt - Interest Expense, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |||
Interest expense | $ (535.9) | $ (539.4) | $ (467) |
Interest income | 1.4 | 1 | 3.6 |
Capitalized interest | 0.3 | 0 | 0.2 |
Interest expense, net | $ (534.2) | $ (538.4) | $ (463.2) |
Long-term Debt - Other Long-ter
Long-term Debt - Other Long-term Obligations (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2015USD ($) | Sep. 30, 2014USD ($)payment | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Debt Instrument [Line Items] | |||||
Long-term debt | $ 2,419,000,000 | $ 2,453,400,000 | |||
Other long-term obligations | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 89,200,000 | 104,600,000 | |||
Other long-term obligations | Ohio relocation fees debt | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 76,400,000 | 91,300,000 | |||
Debt principal amount | $ 75,000,000 | ||||
Amount payable upon opening of the facility | $ 7,500,000 | ||||
Number of semi-annual payments | payment | 18 | ||||
Amount of semi-annual payments due beginning one year from commencement of operations | $ 4,800,000 | ||||
Effective yield | 5.00% | ||||
Interest expense | 4,100,000 | 4,800,000 | $ 5,500,000 | ||
Other long-term obligations | Ohio relocation fees debt | Discount rate | |||||
Debt Instrument [Line Items] | |||||
Discount rate | 0.050 | ||||
Other long-term obligations | Event center debt | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 12,600,000 | 13,200,000 | |||
Debt principal amount | $ 15,300,000 | ||||
Effective yield | 3.00% | ||||
Interest expense | $ 400,000 | $ 400,000 | $ 400,000 | ||
Periodic payment amount | $ 1,000,000 | ||||
Debt term | 20 years |
Leases - Variable Lease Expense
Leases - Variable Lease Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | $ 3.9 | ||
Interest Expense, net | |||
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | 0 | ||
General and Administrative | |||
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | 1.1 | ||
Penn Master Lease | |||
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | 32.5 | $ 48.9 | $ 46.8 |
Penn Master Lease | Interest Expense, net | |||
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | 16.1 | 48.9 | 46.8 |
Penn Master Lease | General and Administrative | |||
Lessee, Lease, Cost [Line Items] | |||
Total variable expenses | $ 16.4 | $ 0 | $ 0 |
Leases - Other Information Rela
Leases - Other Information Related to Lease Term and Discount Rate (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Weighted-Average Remaining Lease Term | |
Operating leases | 27 years 7 months 6 days |
Finance leases | 28 years 7 months 6 days |
Financing obligations | 30 years 4 months 24 days |
Weighted-Average Discount Rate | |
Operating leases | 6.70% |
Finance leases | 6.80% |
Financing obligations | 8.10% |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | $ 366.4 |
Operating lease cost | 17.5 |
Short-term lease cost | 56.6 |
Variable lease cost | 3.9 |
Total | 444.4 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 15.4 |
Amortization expense | 7.9 |
Total | 23.3 |
Financing Obligation, Costs [Abstract] | |
Interest expense | 394.1 |
General and Administrative | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | 366.4 |
Operating lease cost | 16.6 |
Short-term lease cost | 1.5 |
Variable lease cost | 1.1 |
Total | 385.6 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 0 |
Amortization expense | 0 |
Total | 0 |
Financing Obligation, Costs [Abstract] | |
Interest expense | 0 |
Interest Expense, net | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | 0 |
Operating lease cost | 0 |
Short-term lease cost | 0 |
Variable lease cost | 0 |
Total | 0 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 15.4 |
Amortization expense | 0 |
Total | 15.4 |
Financing Obligation, Costs [Abstract] | |
Interest expense | 394.1 |
Depreciation and Amortization | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | 0 |
Operating lease cost | 0 |
Short-term lease cost | 0 |
Variable lease cost | 0 |
Total | 0 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 0 |
Amortization expense | 7.9 |
Total | 7.9 |
Financing Obligation, Costs [Abstract] | |
Interest expense | 0 |
Gaming | Cost of revenue | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | 0 |
Operating lease cost | 0.4 |
Short-term lease cost | 53.8 |
Variable lease cost | 2.8 |
Total | 57 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 0 |
Amortization expense | 0 |
Total | 0 |
Financing Obligation, Costs [Abstract] | |
Interest expense | 0 |
Food, beverage, hotel and other | Cost of revenue | |
Operating Lease Costs | |
Rent expense associated with triple net leases classified as operating leases | 0 |
Operating lease cost | 0.5 |
Short-term lease cost | 1.3 |
Variable lease cost | 0 |
Total | 1.8 |
Lessee, Finance Lease, Cost [Abstract] | |
Interest expense | 0 |
Amortization expense | 0 |
Total | 0 |
Financing Obligation, Costs [Abstract] | |
Interest expense | $ 0 |
Leases - Future Minimum Lease C
Leases - Future Minimum Lease Commitments (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Operating Leases | |||
2020 | $ 424 | ||
2021 | 403.7 | ||
2022 | 400.6 | ||
2023 | 397.5 | ||
2024 | 381 | ||
Thereafter | 8,153.3 | ||
Total lease payments | 10,160.1 | ||
Less: Imputed interest | (5,585.4) | ||
Present value of future lease payments | 4,574.7 | ||
Less: Current portion of lease obligations | (124.1) | $ (102.3) | $ 0 |
Long-term portion of lease obligations | 4,450.6 | 3,704.4 | 0 |
Finance Leases | |||
2020 | 21.7 | ||
2021 | 21.7 | ||
2021 | 21.6 | ||
2022 | 20.8 | ||
2023 | 16.7 | ||
Thereafter | 393.5 | ||
Total lease payments | 496 | ||
Present value of future lease payments | (270.1) | ||
Present value of future lease payments | 225.9 | ||
Less: Current portion of lease obligations | (6.5) | (5.8) | 0 |
Long-term portion of lease obligations | 219.4 | 218.3 | 0 |
Financing Obligations | |||
2020 | 374.7 | ||
2021 | 367.3 | ||
2022 | 367.3 | ||
2023 | 367.3 | ||
2024 | 367.3 | ||
Thereafter | 9,270.6 | ||
Total lease payments | 11,114.5 | ||
Less: Imputed interest | (6,971.8) | ||
Present value of future lease payments | 4,142.7 | ||
Less: Current portion of lease obligations | (40.5) | (50.1) | (67.8) |
Long-term portion of lease obligations | $ 4,102.2 | $ 4,144.2 | $ 7,080.6 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows from finance leases | $ 15.4 | ||
Operating cash flows from operating leases | 403.6 | ||
Financing cash flows from finance leases | $ 6.2 | $ 0 | $ 0 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Millions | Feb. 01, 2020 | Nov. 01, 2019USD ($) | Oct. 01, 2019USD ($) | May 23, 2019USD ($)renewal_option | May 01, 2019USD ($) | Jan. 01, 2019renewal_option | Nov. 01, 2018USD ($) | Nov. 01, 2017USD ($) | Sep. 09, 2016USD ($)extension_period | Apr. 28, 2016facilityextension_period | Nov. 01, 2013facilityextension_period | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Schedule of Leased Assets [Line Items] | ||||||||||||||
Rent expense | $ 58.1 | $ 45.4 | ||||||||||||
Lease payments | $ 869.8 | 537.4 | 455.4 | |||||||||||
Lease income | $ 311 | $ 163.6 | $ 129.9 | |||||||||||
Penn Master Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Number of facilities with leased real estate | facility | 19 | |||||||||||||
Lease term | 15 years | |||||||||||||
Number of lease renewal terms | extension_period | 4 | |||||||||||||
Lease renewal term | 5 years | |||||||||||||
Lease - expected term with renewal options | 35 years | |||||||||||||
Annual escalator percentage | 2.00% | |||||||||||||
Adjusted revenue to rent ratio | 1.8 | |||||||||||||
Period over which fixed component is adjusted | 5 years | |||||||||||||
Adjustment to fixed component as percentage of the average change to net revenues during the preceding five years | 4.00% | |||||||||||||
Percentage rent baseline period | 5 years | |||||||||||||
Adjustment to fixed component as percentage of the average change to net revenues during preceding month | 20.00% | |||||||||||||
Increase in fixed component of rent resulting from annual escalator | $ 5.5 | $ 5.4 | $ 2.4 | |||||||||||
Annual rent reduction resulting from Penn Percentage Rent reset | $ 11.3 | |||||||||||||
Operating lease, annual escalator, additional ROU asset recognized | 34.4 | |||||||||||||
Operating lease, annual escalator, additional lease liability recognized | 34.4 | |||||||||||||
Finance lease, annual escalator, additional ROU asset recognized | 3.1 | |||||||||||||
Finance lease, annual escalator, additional lease liability recognized | $ 3.1 | |||||||||||||
Operating lease, competition clause, additional ROU asset recognized | $ 151.2 | |||||||||||||
Operating lease, competition clause, additional lease liability recognized | $ 151.2 | |||||||||||||
Pinnacle Master Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Number of facilities with leased real estate | facility | 12 | |||||||||||||
Number of lease renewal terms | extension_period | 5 | |||||||||||||
Lease renewal term | 5 years | |||||||||||||
Lease - expected term with renewal options | 32 years 6 months | |||||||||||||
Annual escalator percentage | 2.00% | |||||||||||||
Percentage rent baseline period | 2 years | |||||||||||||
Increase in fixed component of rent resulting from annual escalator | $ 1 | |||||||||||||
Operating lease, annual escalator, additional ROU asset recognized | 3.8 | |||||||||||||
Operating lease, annual escalator, additional lease liability recognized | $ 3.8 | |||||||||||||
Remaining lease term | 7 years 6 months | |||||||||||||
Initial lease term | 10 years | |||||||||||||
Adjusted Revenue to Rent Ratio, as defined | 1.8 | |||||||||||||
Percentage rent escalation interval | 2 years | |||||||||||||
Percentage of average net revenues during preceding two years | 4.00% | |||||||||||||
Meadows Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Annual escalator percentage | 5.00% | |||||||||||||
Increase in fixed component of rent resulting from annual escalator | $ 0.8 | |||||||||||||
Operating lease, annual escalator, additional ROU asset recognized | 4.3 | |||||||||||||
Operating lease, annual escalator, additional lease liability recognized | $ 4.3 | |||||||||||||
Operating lease, remaining lease term | 8 years | |||||||||||||
Operating lease, term | 10 years | |||||||||||||
Operating lease, sum of Base Rant and Percentage Rent threshold | $ 31 | |||||||||||||
Operating lease, annual escalator after initial term or threshold | 2.00% | |||||||||||||
Operating lease, adjusted rent to revenue ratio | 2 | |||||||||||||
Operating lease, percentage of average annual net revenues during the preceding two years | 4.00% | |||||||||||||
Meadows Lease | Lease renewal option one | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Lease renewal term | 5 years | |||||||||||||
Operating lease, number of lease renewal terms | extension_period | 3 | |||||||||||||
Meadows Lease | Lease renewal option two | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Lease renewal term | 4 years | |||||||||||||
Operating lease, number of lease renewal terms | extension_period | 1 | |||||||||||||
Margaritaville Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Annual escalator percentage | 2.00% | |||||||||||||
Lease renewal term | 5 years | |||||||||||||
Operating lease, term | 15 years | |||||||||||||
Operating lease, number of lease renewal terms | renewal_option | 4 | |||||||||||||
Operating lease, adjusted rent to revenue ratio | 1.9 | |||||||||||||
Operating lease, percentage of average annual net revenues during the preceding two years | 4.00% | |||||||||||||
Greektown Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Annual escalator percentage | 2.00% | |||||||||||||
Lease renewal term | 5 years | |||||||||||||
Operating lease, term | 15 years | |||||||||||||
Operating lease, number of lease renewal terms | renewal_option | 4 | |||||||||||||
Operating lease, adjusted rent to revenue ratio | 1.85 | |||||||||||||
Operating lease, percentage of average annual net revenues during the preceding two years | 4.00% | |||||||||||||
Subsequent event | Margaritaville Lease | ||||||||||||||
Schedule of Leased Assets [Line Items] | ||||||||||||||
Annual escalator percentage | 2.00% | |||||||||||||
Operating lease, adjusted rent to revenue ratio | 6.1 |
Commitments and Contingencies -
Commitments and Contingencies - Location Share Agreements, Purchase Obligations and Capital Expenditure Commitments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Commitments [Line Items] | |||
Purchase obligations | $ 126.4 | ||
Purchase obligations, 2020 | $ 70.4 | ||
Master Leases | |||
Other Commitments [Line Items] | |||
Minimum required facility maintenance spending, as a percent of annual net revenues | 1.00% | ||
Location share agreements | |||
Other Commitments [Line Items] | |||
Cost of revenue | $ 33.1 | $ 34.7 | $ 29.7 |
Commitments and Contingencies_2
Commitments and Contingencies - Employee Benefit Plans and Labor Agreements (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)agreementemployee | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Defined Contribution Plan Disclosure [Line Items] | |||
Deferred compensation vesting period | 5 years | ||
Deferred compensation matching contributions | $ | $ 2.3 | $ 2.3 | $ 2.2 |
Deferred compensation liability, current | $ | $ 80.1 | 64.1 | |
Number of collective bargaining agreements | agreement | 31 | ||
Number of employees covered under collective bargaining agreement | employee | 5,900 | ||
Number of collective borrowing agreements expiring in 2020 | agreement | 7 | ||
Number of collective borrowing agreements expired in 2019 | agreement | 3 | ||
401(k) Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Discretionary match contribution percentage | 50.00% | ||
Maximum percentage of eligible employee compensation eligible for discretionary employer match contribution | 6.00% | ||
Matching contributions | $ | $ 11.7 | $ 6.5 | $ 6 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Stock-based compensation expense | $ 11.7 | $ 9 |
Accrued expenses | 37.6 | 42.9 |
Financing obligations associated with the Master Leases | 1,097.6 | 1,919.7 |
Unrecognized tax benefits | 7.7 | 6.7 |
Investments in and advances to unconsolidated affiliates | 0 | 3.6 |
Net operating losses, interest limitation and tax credit carryforwards | 87.6 | 122.8 |
Gross deferred tax assets | 1,242.2 | 2,104.7 |
Less: Valuation allowance | (54.2) | (89.5) |
Total deferred tax assets | 1,188 | 2,015.2 |
Deferred tax liabilities: | ||
Property and equipment, not subject to the Master Leases | (53.1) | (47.3) |
Property and equipment, subject to the Master Leases | (1,088.9) | (1,599.9) |
Investments in and advances to unconsolidated affiliates | (2.9) | 0 |
Undistributed foreign earnings | (0.4) | (0.4) |
Intangible assets | (287.3) | (287) |
Total deferred tax liabilities | (1,432.6) | (1,934.6) |
Long-term deferred tax liabilities, net | $ (244.6) | |
Long-term deferred tax assets, net | $ 80.6 |
Income Taxes - Income Before In
Income Taxes - Income Before Income Tax Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Line Items] | |||
Income (loss) before income taxes | $ 86.1 | $ 89.9 | $ (25.1) |
Domestic | |||
Income Taxes [Line Items] | |||
Income (loss) before income taxes | 85.5 | 89.6 | (29.6) |
Foreign | |||
Income Taxes [Line Items] | |||
Income (loss) before income taxes | $ 0.6 | $ 0.3 | $ 4.5 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Benefit (Expense) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current tax benefit (expense) | |||
Federal | $ (12.5) | $ (15.3) | $ (16.3) |
State | (9.2) | (6.4) | (6.1) |
Foreign | (0.2) | (1.4) | 3 |
Total current | (21.9) | (23.1) | (19.4) |
Deferred tax benefit (expense) | |||
Federal | (16.7) | 14.6 | 480.7 |
State | (4.4) | 10.9 | 39.3 |
Foreign | 0 | 1.2 | (2.1) |
Total deferred | (21.1) | 26.7 | 517.9 |
Total income tax benefit (expense) | $ (43) | $ 3.6 | $ 498.5 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Effective Income Tax Rate (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Percent and amount of pretax income | ||||
Federal statutory rate | 21.00% | 21.00% | 35.00% | |
State and local income taxes, net of federal benefits | 9.90% | (6.20%) | 6.30% | |
Nondeductible expenses | 4.00% | 6.90% | (16.00%) | |
Goodwill impairment losses | 14.40% | 0.00% | (20.50%) | |
Compensation | 0.30% | (3.80%) | 29.50% | |
Contingent liability settlement | 0.00% | 0.00% | 22.90% | |
Foreign | 0.10% | (0.10%) | 11.30% | |
Valuation allowance | 0.00% | (20.30%) | 2962.30% | |
Tax Act - deferred rate change | 0.00% | 0.00% | (1043.50%) | |
Other | 0.20% | (1.50%) | 3.30% | |
Total effective tax rate and income tax benefit (expense) | 49.90% | (4.00%) | 1990.60% | |
Amount of pretax income | ||||
Federal statutory rate | $ (18.1) | $ (18.9) | $ 8.8 | |
State and local income taxes - net of federal benefits | (8.5) | 5.6 | 1.6 | |
Nondeductible expenses | (3.5) | (6.2) | (4) | |
Goodwill impairment | (12.4) | 0 | (5.1) | |
Compensation | (0.3) | 3.4 | 7.4 | |
Contingent liability settlement | 0 | 0 | 5.7 | |
Foreign | (0.1) | 0.1 | 2.8 | |
Valuation allowance | $ 22.4 | 0 | 18.3 | 741.9 |
Tax Act - deferred rate change | 0 | 0 | (261.3) | |
Other miscellaneous items | (0.1) | 1.3 | 0.7 | |
Total income tax benefit (expense) | $ (43) | $ 3.6 | $ 498.5 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance | $ 29.7 | $ 30.9 | $ 26.8 |
Additions based on current year positions | 2.9 | ||
Additions based on prior year positions | 6.5 | 0.8 | 2.8 |
Decreases due to settlements and/or reduction in reserves | (0.2) | (2) | (1.3) |
Currency translation adjustments | (0.1) | ||
Settlement payments | (0.2) | ||
Balance | $ 36 | $ 29.7 | $ 30.9 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) | |
Income Taxes [Line Items] | |||||
Net deferred tax assets | $ (2,015,200,000) | $ (1,188,000,000) | $ (2,015,200,000) | ||
Net deferred tax liabilities | (1,934,600,000) | (1,432,600,000) | (1,934,600,000) | ||
Three-year cumulative pretax income | 150,900,000 | ||||
Valuation allowance | 89,500,000 | 54,200,000 | 89,500,000 | ||
Valuation allowance released | 22,400,000 | 0 | 18,300,000 | $ 741,900,000 | |
Decrease in valuation allowance | 35,300,000 | ||||
Tax benefit associated with net operating loss carryforwards | 52,200,000 | ||||
Tax Act, provisional income tax expense | 266,000,000 | ||||
Tax Act, deferred tax assets, provisional income tax expense | 261,300,000 | ||||
Tax Act, transition tax for foreign dividends, provisional income tax expense | 2,600,000 | ||||
Tax Act, foreign withholding tax, provisional income tax expense | 2,100,000 | ||||
Tax Act, measurement period adjustment, income tax expense | $ 1,200,000 | ||||
Tax Act, measurement period adjustment, percent | 0.013 | ||||
Tax reserves, interest and penalties related to current year tax positions | 0 | ||||
Tax reserves, interest and penalties related to prior year tax positions | 7,100,000 | ||||
Reversal of previously recorded tax reserves and accrued interest for tax positions settled and/or closed | 200,000 | ||||
Unrecognized tax benefits | 30,400,000 | 37,200,000 | $ 30,400,000 | ||
Net tax expense in connection with uncertain tax positions | 2,800,000 | ||||
Tax positions that, if reversed, would affect the effective tax rate | 23,600,000 | 29,400,000 | 23,600,000 | ||
Interest and penalties recognized, net of deferred taxes | 100,000 | 500,000 | $ 1,700,000 | ||
Prepaid income taxes | $ 14,900,000 | 22,200,000 | $ 14,900,000 | ||
Domestic | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 120,300,000 | ||||
State | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 766,200,000 | ||||
Net operating loss carryforwards, valuation allowance | $ 36,400,000 | ||||
ASC 842 | |||||
Income Taxes [Line Items] | |||||
Net deferred tax assets | $ 739,200,000 | ||||
Net deferred tax liabilities | $ 435,400,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 12 Months Ended | ||||
Dec. 31, 2019USD ($)series$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Jan. 09, 2019USD ($) | Feb. 03, 2017USD ($) | |
Class of Stock [Line Items] | |||||
Authorized amount under share repurchase program | $ | $ 200,000,000 | $ 100,000,000 | |||
Share repurchases (in shares) | 1,271,823 | 2,299,498 | 1,264,149 | ||
Repurchases of common stock | $ | $ 24,900,000 | $ 50,000,000 | $ 24,800,000 | ||
Average price paid per share of common stock repurchased (in dollars per share) | $ / shares | $ 19.55 | $ 21.74 | $ 19.59 | ||
Number of series of preferred stock | series | 2 | ||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||
Series B Preferred stock | |||||
Class of Stock [Line Items] | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | |||
Preferred stock, shares outstanding (in shares) | 0 | 0 | |||
Series C Preferred stock | |||||
Class of Stock [Line Items] | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||
Preferred stock, shares authorized (in shares) | 18,500 | 18,500 | |||
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) $ / shares in Units, $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Number of Option Shares | |
Options outstanding (in shares) | shares | 5,869,211 |
Granted (in shares) | shares | 2,436,811 |
Exercised (in shares) | shares | (230,644) |
Forfeited (in shares) | shares | (257,942) |
Options outstanding (in shares) | shares | 7,817,436 |
Options outstanding, weighted average remaining contractual term | 4 years 10 months 2 days |
Options outstanding, aggregate intrinsic value | $ | $ 75.1 |
Weighted-Average Exercise Price | |
Options outstanding (in dollars per share) | $ / shares | $ 15.14 |
Granted (in dollars per share) | $ / shares | 19.24 |
Exercised (in dollars per share) | $ / shares | 14.32 |
Forfeited (in dollars per share) | $ / shares | 19.44 |
Options outstanding (in dollars per share) | $ / shares | $ 16.30 |
Options Exercisable | |
Options exercisable (in shares) | shares | 4,071,052 |
Options exercisable, weighted average exercise price (in dollars per share) | $ / shares | $ 13.62 |
Options exercisable, weighted average remaining contractual term | 2 years 5 months 26 days |
Options exercisable, aggregate intrinsic value | $ | $ 49.2 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock Options By Exercise Price Ranges (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
$11.61 to $16.93 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Low end of exercise price range (in dollars per share) | $ 11.61 |
High end of exercise price range (in dollars per share) | $ 16.93 |
Outstanding options | |
Number outstanding (in shares) | shares | 4,842,725 |
Weighted-average remaining contractual life | 2 years 7 months 28 days |
Weighted-average exercise price (in dollars per share) | $ 13.06 |
Exercisable options | |
Number outstanding (in shares) | shares | 3,901,333 |
Weighted-average exercise price (in dollars per share) | $ 12.91 |
$17.77 to $25.05 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Low end of exercise price range (in dollars per share) | 17.77 |
High end of exercise price range (in dollars per share) | $ 25.05 |
Outstanding options | |
Number outstanding (in shares) | shares | 2,368,886 |
Weighted-average remaining contractual life | 9 years 3 months 7 days |
Weighted-average exercise price (in dollars per share) | $ 19.23 |
Exercisable options | |
Number outstanding (in shares) | shares | 10,584 |
Weighted-average exercise price (in dollars per share) | $ 18.62 |
$30.74 to $32.90 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Low end of exercise price range (in dollars per share) | 30.74 |
High end of exercise price range (in dollars per share) | $ 32.90 |
Outstanding options | |
Number outstanding (in shares) | shares | 605,825 |
Weighted-average remaining contractual life | 4 years 11 months 12 days |
Weighted-average exercise price (in dollars per share) | $ 30.75 |
Exercisable options | |
Number outstanding (in shares) | shares | 159,135 |
Weighted-average exercise price (in dollars per share) | $ 30.75 |
$11.61 to $32.90 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Low end of exercise price range (in dollars per share) | 11.61 |
High end of exercise price range (in dollars per share) | $ 32.90 |
Outstanding options | |
Number outstanding (in shares) | shares | 7,817,436 |
Weighted-average remaining contractual life | 4 years 10 months 2 days |
Weighted-average exercise price (in dollars per share) | $ 16.30 |
Exercisable options | |
Number outstanding (in shares) | shares | 4,071,052 |
Weighted-average exercise price (in dollars per share) | $ 13.62 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted-Average Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Weighted-average assumptions used in the Black-Scholes option-pricing model | |||
Risk-free interest rate | 2.00% | 2.26% | 1.97% |
Expected volatility | 32.90% | 30.80% | 30.66% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Weighted-average expected life | 5 years 3 months 18 days | 5 years 3 months 18 days | 5 years 3 months 18 days |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Activity (Details) - $ / shares | Feb. 14, 2019 | Feb. 06, 2018 | Feb. 17, 2017 | Feb. 09, 2016 | Dec. 31, 2019 |
Performance shares | |||||
Number of Shares | |||||
Outstanding (in shares) | 351,472 | ||||
Granted (in shares) | 278,780 | 197,727 | 172,245 | 189,085 | 253,609 |
Released (in shares) | (193,799) | ||||
Canceled (in shares) | (15,920) | ||||
Outstanding (in shares) | 395,362 | ||||
Weighted- Average Grant Date Fair Value | |||||
Outstanding (in dollars per share) | $ 22.10 | ||||
Awarded (in dollars per share) | 23.55 | ||||
Released (in dollars per share) | 19.36 | ||||
Canceled (in dollars per share) | 22.60 | ||||
Outstanding (in dollars per share) | $ 24.35 | ||||
Restricted stock | |||||
Number of Shares | |||||
Outstanding (in shares) | 207,349 | ||||
Granted (in shares) | 175,795 | ||||
Released (in shares) | (35,758) | ||||
Canceled (in shares) | (48,907) | ||||
Outstanding (in shares) | 298,479 | ||||
Weighted- Average Grant Date Fair Value | |||||
Outstanding (in dollars per share) | $ 25.55 | ||||
Awarded (in dollars per share) | 19.44 | ||||
Released (in dollars per share) | 18.05 | ||||
Canceled (in dollars per share) | 23.71 | ||||
Outstanding (in dollars per share) | $ 23.15 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) $ / shares in Units, $ in Millions | Feb. 14, 2019shares | Feb. 06, 2018shares | Feb. 17, 2017shares | Feb. 09, 2016shares | Jun. 30, 2018shares | Dec. 31, 2019USD ($)performance_period$ / sharesshares | Dec. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($)$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation expense | $ 14.9 | $ 12 | $ 7.8 | |||||
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 6.39 | $ 9.88 | $ 4.48 | |||||
Intrinsic value of stock options exercised | $ 2 | $ 28.7 | $ 15.8 | |||||
Fair value of stock options vested | 6.2 | 5.9 | 6.4 | |||||
Unamortized compensation costs, stock options | $ 16.9 | |||||||
Restricted stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unamortized compensation costs, weighted average period of recognition | 1 year 10 months 24 days | |||||||
Awards granted (in shares) | shares | 175,795 | |||||||
Unrecognized compensation cost, other awards | $ 7.9 | |||||||
Fair value of awards vested | $ 5.5 | 0.9 | 1 | |||||
Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Low end of exercise price range (in dollars per share) | $ / shares | $ 11.61 | |||||||
High end of exercise price range (in dollars per share) | $ / shares | $ 32.90 | |||||||
Unamortized compensation costs, weighted average period of recognition | 2 years 10 months 24 days | |||||||
Stock options | Minimum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Contractual lives | 2 years | |||||||
Stock options | Maximum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Contractual lives | 10 years | |||||||
Performance shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Awards granted (in shares) | shares | 278,780 | 197,727 | 172,245 | 189,085 | 253,609 | |||
Annual increment percentage at which awards are granted | 33.33% | |||||||
Number of annual award performance periods | performance_period | 3 | |||||||
Service period | 3 years | |||||||
Vesting period | 3 years | |||||||
Performance shares | Minimum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award which can potentially be earned | 0.00% | |||||||
Performance shares | Maximum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of award which can potentially be earned | 150.00% | |||||||
Phantom stock units (PSUs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation expense | $ 4.1 | 1.1 | 11.9 | |||||
Unamortized compensation costs, weighted average period of recognition | 1 year 7 months 6 days | |||||||
Unrecognized compensation cost, other awards | $ 3.3 | |||||||
Liability for cash-settled awards | 3.3 | 1.7 | ||||||
Amounts paid on cash-settled awards | $ 2.5 | 4.2 | 12.7 | |||||
Phantom stock units (PSUs) | Minimum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period | 3 years | |||||||
Phantom stock units (PSUs) | Maximum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period | 4 years | |||||||
Stock appreciation rights (SARs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation expense | $ 10.7 | (6.7) | 21.9 | |||||
Unamortized compensation costs, weighted average period of recognition | 2 years 7 months 6 days | |||||||
Vesting period | 4 years | |||||||
Unrecognized compensation cost, other awards | $ 9.6 | |||||||
Liability for cash-settled awards | 14.4 | 6.8 | ||||||
Amounts paid on cash-settled awards | $ 3.5 | $ 10.5 | $ 6.2 | |||||
2018 Long Term Incentive Compensation Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock available for awards, up to (in shares) | shares | 12,700,000 | |||||||
Common stock counted against the maximum shares available for grant for each share awarded under the plan (in shares) | 1 | |||||||
Shares available for future grants (in shares) | shares | 8,417,411 | |||||||
2018 Long Term Incentive Compensation Plan | Restricted stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock counted against the maximum shares available for grant for each share awarded under the plan (in shares) | 2.30 |
Earnings per Share - Reconcilia
Earnings per Share - Reconciliation of Weighted-Average Common Shares Outstanding (Details) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Determination of shares: | |||
Weighted-average common shares outstanding (in shares) | 115,700,000 | 97,100,000 | 90,900,000 |
Diluted weighted-average common shares outstanding (in shares) | 117,800,000 | 100,300,000 | 93,400,000 |
Anti-dilutive securities, stock options (in shares) | 2,353,307 | 656,588 | 51,803 |
Stock options | |||
Determination of shares: | |||
Assumed conversion of dilutive employee stock-based awards and restricted stock (in shares) | 1,800,000 | 3,000,000 | 2,400,000 |
Restricted stock | |||
Determination of shares: | |||
Assumed conversion of dilutive employee stock-based awards and restricted stock (in shares) | 300,000 | 200,000 | 100,000 |
Earnings per Share - Calculatio
Earnings per Share - Calculation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Calculation of basic EPS: | |||||||||||
Net income applicable to common stock | $ 43.9 | $ 93.5 | $ 473.4 | ||||||||
Weighted-average common shares outstanding (in shares) | 115.7 | 97.1 | 90.9 | ||||||||
Basic EPS (in dollars per share) | $ (0.80) | $ 0.38 | $ 0.44 | $ 0.35 | $ (0.37) | $ 0.39 | $ 0.59 | $ 0.50 | $ 0.38 | $ 0.96 | $ 5.21 |
Calculation of diluted EPS: | |||||||||||
Diluted weighted-average common shares outstanding (in shares) | 117.8 | 100.3 | 93.4 | ||||||||
Diluted EPS (in dollars per share) | $ (0.80) | $ 0.38 | $ 0.44 | $ 0.35 | $ (0.37) | $ 0.38 | $ 0.57 | $ 0.48 | $ 0.37 | $ 0.93 | $ 5.07 |
Segment Information (Details)
Segment Information (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||||||||||||
Number of reportable segments | segment | 4 | |||||||||||
Revenues: | ||||||||||||
Total | $ 1,341.2 | $ 1,354.5 | $ 1,323.1 | $ 1,282.6 | $ 1,155.3 | $ 789.7 | $ 826.9 | $ 816.1 | $ 5,301.4 | $ 3,587.9 | $ 3,148 | |
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | 1,605.2 | 1,043.2 | 879.1 | |||||||||
Rent expense associated with triple net operating lease | (366.4) | (3.8) | 0 | |||||||||
Stock-based compensation | (14.9) | (12) | (7.8) | |||||||||
Cash-settled stock-based awards variance | (0.8) | 19.6 | (23.4) | |||||||||
Loss on disposal of assets | (5.5) | (3.2) | (0.2) | |||||||||
Contingent purchase price | (7) | (0.5) | 6.8 | |||||||||
Pre-opening and acquisition costs | (22.3) | (95) | (9.7) | |||||||||
Depreciation and amortization | (414.2) | (269) | (267.1) | |||||||||
Impairment losses | (173.1) | (34.9) | (18) | |||||||||
Recoveries on (provision for) loan loss and unfunded loan commitments | 0 | 17 | (89.8) | |||||||||
Insurance recoveries, net of deductible charges | 3 | 0.1 | 0.3 | |||||||||
Non-operating items for Kansas JV | (3.7) | (5.1) | (5.8) | |||||||||
Interest expense, net | (534.2) | (538.4) | (463.2) | |||||||||
Loss on early extinguishment of debt | (17.2) | 0 | (21) | (24) | ||||||||
Other | 20 | (7.1) | (2.3) | |||||||||
Income (loss) before income taxes | 86.1 | 89.9 | (25.1) | |||||||||
Income tax benefit (expense) | (43) | 3.6 | 498.5 | |||||||||
Net income | (92.9) | $ 43.7 | $ 51.3 | $ 41 | (42) | $ 36.1 | $ 54 | $ 45.4 | 43.1 | 93.5 | 473.4 | |
Capital expenditures: | ||||||||||||
Capital expenditures | 190.6 | 92.6 | 99.3 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 128.3 | 128.5 | 128.3 | 128.5 | 148.9 | |||||||
Total assets | 14,194.5 | 10,961 | 14,194.5 | 10,961 | 5,234.8 | $ 13,424.8 | ||||||
Operating segments | Northeast segment | ||||||||||||
Revenues: | ||||||||||||
Total | 2,399.9 | 1,891.5 | 1,756.6 | |||||||||
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | 720.8 | 583.8 | 549.3 | |||||||||
Capital expenditures: | ||||||||||||
Capital expenditures | 96.2 | 38.9 | 26.3 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | |||||||
Total assets | 2,273.7 | 1,330.2 | 2,273.7 | 1,330.2 | 921 | |||||||
Operating segments | South segment | ||||||||||||
Revenues: | ||||||||||||
Total | 1,118.9 | 394.4 | 224.3 | |||||||||
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | 369.8 | 118.9 | 62.6 | |||||||||
Capital expenditures: | ||||||||||||
Capital expenditures | 29.8 | 10.6 | 6.3 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 0 | 0 | 0 | 0 | 0 | |||||||
Total assets | 1,397 | 1,082.3 | 1,397 | 1,082.3 | 169.3 | |||||||
Operating segments | West segment | ||||||||||||
Revenues: | ||||||||||||
Total | 642.5 | 437.9 | 380.4 | |||||||||
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | 198.8 | 114.3 | 72.7 | |||||||||
Capital expenditures: | ||||||||||||
Capital expenditures | 21.2 | 12.8 | 35.7 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 0 | 0 | 0 | 0 | 0 | |||||||
Total assets | 752.1 | 755.7 | 752.1 | 755.7 | 625 | |||||||
Operating segments | Midwest segment | ||||||||||||
Revenues: | ||||||||||||
Total | 1,094.5 | 823.7 | 735 | |||||||||
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | 403.6 | 294.3 | 249.7 | |||||||||
Capital expenditures: | ||||||||||||
Capital expenditures | 32.7 | 25.3 | 26.2 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 90.9 | 89.4 | 90.9 | 89.4 | 88.3 | |||||||
Total assets | 1,412.2 | 1,411.5 | 1,412.2 | 1,411.5 | 970.8 | |||||||
Other | ||||||||||||
Revenues: | ||||||||||||
Total | 47.5 | 40.4 | 51.7 | |||||||||
Adjusted EBITDAR: | ||||||||||||
Adjusted EBITDAR | (87.8) | (68.1) | (55.2) | |||||||||
Capital expenditures: | ||||||||||||
Capital expenditures | 10.7 | 5 | 4.8 | |||||||||
Assets: | ||||||||||||
Investment in and advances to unconsolidated affiliates | 37.3 | 39 | 37.3 | 39 | 60.5 | |||||||
Total assets | $ 8,359.5 | $ 6,381.3 | 8,359.5 | 6,381.3 | 2,548.7 | |||||||
Intersegment eliminations | ||||||||||||
Revenues: | ||||||||||||
Total | $ (1.9) | $ 0 | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)payment | Dec. 31, 2018USD ($)payment | Jan. 19, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity securities | $ 40.5 | ||
Impairment of promissory notes and bonds | $ 2.5 | ||
Interest rate | 5.625% | ||
Plainridge Park Casino | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Period of actual earnings used to calculate contingent consideration | 10 years | ||
Number of remaining annual payments | payment | 6 | 7 | |
Absolute Bingo | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Period of actual earnings used to calculate contingent consideration | 2 years | ||
Number of remaining annual payments | payment | 1 | ||
Senior notes | 5.625% Notes due 2027 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate | 5.625% | 5.625% | |
Retama Nominal Holder, LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Ownership interest | 1.00% | ||
Pinnacle Retama Partners, LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Ownership interest by parent | 75.50% | ||
Pinnacle Retama Partners, LLC | Retama Development Corporation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Promissory notes | $ 15.1 | $ 16.9 | |
Local government bonds | Pinnacle Retama Partners, LLC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Bonds, at amortized cost | $ 6.7 | $ 7.5 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Amounts and Estimated Fair Values by Input Level (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 19, 2017 |
Financial assets: | |||
Equity securities | $ 40.5 | ||
Financial liabilities: | |||
Interest rate | 5.625% | ||
Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Interest rate | 5.625% | 5.625% | |
Carrying Amount | |||
Financial assets: | |||
Cash and cash equivalents | $ 437.4 | $ 479.6 | |
Equity securities | 40.5 | ||
Held-to-maturity securities | 6.7 | 7.5 | |
Promissory notes | 15.1 | 16.9 | |
Financial liabilities: | |||
Other liabilities | 20.3 | 21.9 | |
Carrying Amount | Secured credit facility | |||
Financial liabilities: | |||
Long-term debt | 1,896.5 | 1,907.9 | |
Carrying Amount | Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Long-term debt | 399.4 | 399.3 | |
Carrying Amount | Other long-term obligations | |||
Financial liabilities: | |||
Long-term debt | 89.2 | 104.6 | |
Fair Value | |||
Financial assets: | |||
Cash and cash equivalents | 437.4 | 479.6 | |
Equity securities | 40.5 | ||
Held-to-maturity securities | 6.7 | 7.9 | |
Promissory notes | 15.1 | 17.4 | |
Financial liabilities: | |||
Other liabilities | 20.3 | 21.8 | |
Fair Value | Secured credit facility | |||
Financial liabilities: | |||
Long-term debt | 1,930.6 | 1,886.3 | |
Fair Value | Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Long-term debt | 426 | 360 | |
Fair Value | Other long-term obligations | |||
Financial liabilities: | |||
Long-term debt | 89.7 | 96.3 | |
Level 1 | |||
Financial assets: | |||
Cash and cash equivalents | 437.4 | 479.6 | |
Equity securities | 0 | ||
Held-to-maturity securities | 0 | 0 | |
Promissory notes | 0 | 0 | |
Financial liabilities: | |||
Other liabilities | 0 | 0 | |
Level 1 | Secured credit facility | |||
Financial liabilities: | |||
Long-term debt | 1,930.6 | 1,886.3 | |
Level 1 | Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Long-term debt | 426 | 360 | |
Level 1 | Other long-term obligations | |||
Financial liabilities: | |||
Long-term debt | 0 | 0 | |
Level 2 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | |
Equity securities | 40.5 | ||
Held-to-maturity securities | 6.7 | 7.9 | |
Promissory notes | 15.1 | 17.4 | |
Financial liabilities: | |||
Other liabilities | 2.8 | 2.8 | |
Level 2 | Secured credit facility | |||
Financial liabilities: | |||
Long-term debt | 0 | 0 | |
Level 2 | Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Long-term debt | 0 | 0 | |
Level 2 | Other long-term obligations | |||
Financial liabilities: | |||
Long-term debt | 89.7 | 96.3 | |
Level 3 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | |
Equity securities | 0 | ||
Held-to-maturity securities | 0 | 0 | |
Promissory notes | 0 | 0 | |
Financial liabilities: | |||
Other liabilities | 17.5 | 19 | |
Level 3 | Secured credit facility | |||
Financial liabilities: | |||
Long-term debt | 0 | 0 | |
Level 3 | Senior notes | 5.625% Notes | |||
Financial liabilities: | |||
Long-term debt | 0 | 0 | |
Level 3 | Other long-term obligations | |||
Financial liabilities: | |||
Long-term debt | $ 0 | $ 0 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Fair Value of Level 3 Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Contingent Purchase Price | |||
Balance | $ 19 | $ 22.7 | $ 48.2 |
Additions | 0.9 | ||
Payments | (8.5) | (4.2) | (19.6) |
Included in earnings | 7 | 0.5 | (6.8) |
Balance | $ 17.5 | $ 19 | $ 22.7 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets Measured at Fair Value on a Non-Recurring Basis (Details) - USD ($) | Oct. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Goodwill, fair value | $ 161,100,000 | ||||
Goodwill - total reduction in fair value recorded | (88,000,000) | $ (88,000,000) | $ 0 | ||
Property and equipment, fair value disclosure | $ 0 | $ 0 | 0 | ||
Property and equipment - total reduction in fair value recorded | (34,300,000) | (34,300,000) | (34,300,000) | ||
Gaming licenses | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 290,000,000 | ||||
Indefinite-lived intangible assets - total reduction in fair value recorded | (62,600,000) | ||||
Trademarks | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 87,500,000 | ||||
Indefinite-lived intangible assets - total reduction in fair value recorded | (20,000,000) | ||||
Level 1 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Goodwill, fair value | 0 | ||||
Property and equipment, fair value disclosure | 0 | 0 | 0 | ||
Level 1 | Gaming licenses | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 0 | ||||
Level 1 | Trademarks | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 0 | ||||
Level 2 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Goodwill, fair value | 0 | ||||
Property and equipment, fair value disclosure | 0 | 0 | 0 | ||
Level 2 | Gaming licenses | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 0 | ||||
Level 2 | Trademarks | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 0 | ||||
Level 3 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Goodwill, fair value | 161,100,000 | ||||
Property and equipment, fair value disclosure | $ 0 | $ 0 | $ 0 | ||
Level 3 | Gaming licenses | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | 290,000,000 | ||||
Level 3 | Trademarks | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Indefinite-lived intangible assets, fair value | $ 87,500,000 |
Fair Value Measurements - Signi
Fair Value Measurements - Significant Unobservable Inputs for Fair Value Measurements (Details) $ in Millions | Dec. 31, 2019 | Oct. 01, 2019USD ($) |
Gaming licenses | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, fair value | $ 290 | |
Trademarks | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, fair value | 87.5 | |
Level 3 | Gaming licenses | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, fair value | 290 | |
Level 3 | Trademarks | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, fair value | $ 87.5 | |
Level 3 | Discounted cash flow | Discount rate | Gaming licenses | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.105 | |
Level 3 | Discounted cash flow | Discount rate | Gaming licenses | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.1125 | |
Level 3 | Discounted cash flow | Discount rate | Trademarks | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.105 | |
Level 3 | Discounted cash flow | Discount rate | Trademarks | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.1125 | |
Level 3 | Discounted cash flow | Long-term revenue growth rate | Gaming licenses | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.020 | |
Level 3 | Discounted cash flow | Long-term revenue growth rate | Trademarks | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.020 | |
Level 3 | Discounted cash flow | Pretax royalty rate | Trademarks | Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.010 | |
Level 3 | Discounted cash flow | Pretax royalty rate | Trademarks | Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Indefinite-lived intangible assets, measurement input | 0.020 | |
Plainridge Park Casino | Level 3 | Discounted cash flow | Discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Contingent purchase price, measurement input | 0.0563 |
Related Party Transactions (Det
Related Party Transactions (Details) - Affiliates of Chairman of Board of Directors - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||
Rent expense | $ 1.2 | $ 1.3 | $ 1.2 |
Future minimum lease commitments | $ 1.8 |
Summarized Quarterly Data (Un_3
Summarized Quarterly Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 1,341.2 | $ 1,354.5 | $ 1,323.1 | $ 1,282.6 | $ 1,155.3 | $ 789.7 | $ 826.9 | $ 816.1 | $ 5,301.4 | $ 3,587.9 | $ 3,148 |
Operating income | 11.3 | 179.8 | 198.4 | 182.4 | 124.4 | 155.8 | 181.8 | 172.1 | 571.9 | 634.1 | 445.7 |
Net income (loss) | $ (92.9) | $ 43.7 | $ 51.3 | $ 41 | $ (42) | $ 36.1 | $ 54 | $ 45.4 | $ 43.1 | $ 93.5 | $ 473.4 |
Earnings (loss) per common share: | |||||||||||
Basic earnings (loss) per common share (in dollars per share) | $ (0.80) | $ 0.38 | $ 0.44 | $ 0.35 | $ (0.37) | $ 0.39 | $ 0.59 | $ 0.50 | $ 0.38 | $ 0.96 | $ 5.21 |
Diluted earnings (loss) per common share (in dollars per share) | $ (0.80) | $ 0.38 | $ 0.44 | $ 0.35 | $ (0.37) | $ 0.38 | $ 0.57 | $ 0.48 | $ 0.37 | $ 0.93 | $ 5.07 |
Summarized Quarterly Data (Un_4
Summarized Quarterly Data (Unaudited) - Additional Information (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Quarterly Financial Information [Line Items] | |||||||
Impairment of goodwill and other intangible assets | $ 170.6 | ||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | $ 0 | $ (17) | $ 89.8 | ||||
Impairment of long-lived assets | $ 34.3 | $ 34.3 | 34.3 | ||||
Loss on early extinguishment of debt | 17.2 | $ 0 | 21 | 24 | |||
Pinnacle | |||||||
Quarterly Financial Information [Line Items] | |||||||
Pre-opening and acquisition costs | $ 74.7 | ||||||
JIVDC | |||||||
Quarterly Financial Information [Line Items] | |||||||
Provision for (recoveries on) loan loss and unfunded loan commitments | $ (17) | $ (17) | $ 86 |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, $ in Millions | 1 Months Ended | ||
Feb. 27, 2020USD ($)$ / shares | Dec. 31, 2019$ / shares | Dec. 31, 2018$ / shares | |
Subsequent Event [Line Items] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |
Subsequent event | |||
Subsequent Event [Line Items] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||
Convertible preferred stock, conversion ratio | 0.001 | ||
Subsequent event | Barstool Sports | |||
Subsequent Event [Line Items] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||
Subsequent event | Barstool Sports | |||
Subsequent Event [Line Items] | |||
Ownership interest | 36.00% | ||
Purchase price | $ | $ 163 | ||
Purchase price, cash | $ | 135 | ||
Purchase price, value of shares issued | $ | $ 28 |
Uncategorized Items - penn12312
Label | Element | Value |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | $ 15,500,000 |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | 0 |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | 0 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | 1,500,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | 2,300,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | 1,600,000 |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (9,600,000) |
Accounting Standards Update 2014-09 [Member] | Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (9,600,000) |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (9,600,000) |
Accounting Standards Update 2016-02 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 1,085,700,000 |
Accounting Standards Update 2016-02 [Member] | Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 1,085,700,000 |
Accounting Standards Update 2016-02 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,085,700,000 |