Gaming and Leisure Properties (GLPI) 8 Feb 182017 Q4 Earnings call transcript

Company Profile

Participants

Hayes Croushore	Vice President of Finance
Peter Carlino	Chairman and Chief Executive Officer
William Clifford	Chief Financial Officer, Senior Vice President of Finance and Treasurer
Steve Snyder	Senior Vice President of Development
Desiree Burke	Chief Accounting Officer
Brandon Moore	Senior Vice President, General Counsel and Secretary
Robin Farley	UBS
Joseph Greff	JP Morgan
Carlo Santarelli	Deutsche Bank
Barry Jonas	Bank of America
Thomas Allen	Morgan Stanley
David Katz	Telsey Group

Call transcript

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Operator

Greetings, and welcome to the Gaming and Leisure Properties' Fourth Quarter 2017 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Finance and President, Properties. Vice Croushore, for Leisure Gaming Hayes Thank you.

begin. You now may

Hayes Croushore

Leisure the XXXX you, everyone. press us for and morning, and release today fourth like Gaming Thank morning good you distributed We'd prepared Reform forward-looking Relations earlier Melisa, to your answers is webcast. call earnings of section Investor at statements the and defined our and website Litigation to this thank www.glpropinc.com. may remarks for contain Properties' The Private On XXXX. in of today's Act as quarter in call, available Securities joining management's questions

Forward-looking revenue, results to AFFO. risks to operating guidance, as income address include non-GAAP Examples and actual those that from statements cause today. and measures and discussed financial may statements FFO are as such as differ of well matters to uncertainties financial related subject forward-looking that those

to Properties, President, conference Desiree future. to over review earnings Leisure company's to no Moore, now General Brandon Development; and forward-looking statements Inc. the and joined the Accounting forward-looking of filings Also Bill Snyder, Vice statements morning's As contained company like call, are and Vice of the Peter. by Chief Secretary. a Officer; President contained the reconciliations SEC and are joining Counsel Chairman measures Chief these management's with And Officer; Clifford, Officer Senior On company's the to definitions Executive assumes call this encourage we Peter Carlino, I'd Gaming in Chief and reminder, Senior non-GAAP current release. Burke, discussions Financial of and and and update turn in related Steve any more estimates detailed financial We statements the listeners obligation forward-looking represent the in the to

Peter Carlino

the course thing properties release of That some million rent Gaming, fourth wind I tenant four in notable we've We discussing, to which increase you've good Boyd as the guess you, by our was course the excellent our by for of most quarter quarter in of our year think with propose into Penn everyone. a accretive and morning, good Pinnacle that we which that all and of approximately a fourth had and reasons we'll and merger total Thank and I up will Gaming you. occurred an the new seen our Hayes, of sure highlight. fold. transaction brings sale and as to shareholders be to $XX National

again activity our concluded of been do the pursue I We to in And accretive do and in we always been end focus out has which not now year. remains there, gaming transaction because also space. the some chose things announced we and think only there Tunica, transactions. the We've the to this notable earlier in careful very

trust XXXX, we as as as we're to and and some future the Penn we ahead but looking pretty think So about of…? - that XXXX transaction the toward can year for Bill, And that new this are and us. is talk we nothing I you bright. a so a think we next or the terrific XXXX years, of announce want couple we're couple over look on, highlight end which look at will obviously interesting its working terrific we for or of is there are prospects third we things, to fourth complete

William Clifford

Sure.

term our impact deal we of couple is the items we the quarter of was on know with fourth Penn, effected think the think the company portion of but merger for long accretive kind have million full bonus. I attributable amount meant the of quarter. which none We of that what that that fact we're You our combined Pinnacle prospect Tunica the any new the of which the in X.X had that which to had transaction I one-off the roughly got bonus highlight really and I kind a

effectively really And come that be use is tax fact what from to the us will guidance the assets for we had reduce have million of rate to offset will charge that tax as and Tax favorable of effect X.X where we to the that to extra probably little transaction, the interest that this I second quarter tough that an an the rate XX which are discussion roughly plus we spending million will ratings X.XX were new beneficiary the had from repairs differed recognize of had an we took where we've first the And that S&P we that take that done moved in more meaningful an route had to from the tax we LIBOR related XX and to well on those that means lending as and plus book, relating piece in out, law, accretive TRS, up only just we think is the our us rate fourth all had has So upgrade facilities add worthy off the from extra thing somewhat per our down well insurance fourth into on done asset very which in the on that lower in in on I a the has charge was as flowing proceeds a August. variance comps our quarter effective the down Cut which in other I that which impact of Those what that fact fourth future are which the the caused than XX the liability through meaningful to with X.X of Act us guess X.XX. Jobs share bit our expense quarter XX. money investment obviously relative an our of drop $X.XX quarter. the currently effected slightly really a or basically to as bank our quarter a the lot the by are LIBOR that in quarter. launched previous obviously year caused last to only maybe year the doing had grade as we to

that's impact. clearly an so And

to July coming about forward effect on year we August, $X a million which we that's on a or probably property. August, that in rouge, going in have ban have next that smoking Looking think impact to

with incredibly comps That's So working that mostly rouge ban. its tough it. property smoking it's is definitely it because a challenge plus headwind has off

Peter Carlino

positive local and gas disasters are us. Tear for very

William Clifford

It can be.

Peter Carlino

that past. about federal involve fortunate folks for serious in gets A spent the that. money but of property market the But we been the very tease with so lot in we've

William Clifford

jobs well so done for market everybody that the influx or get at spends as a insurance to happening record, repairs assist casinos. get that of not the all and awful with rates. not come money it's people and it's is is people Yeah, lot and into you a and of the an lot of What that takes there created the job it to extra of and favorable is discretionary lot hourly as adjustments generally work extra in

if It's we they in to think with we but you with, of the do I result to an the said, cleanup that the so related some is start please. generates cleanup hurricane. what that that would used of local happened. questions. open floor we income the and Well that Melisa, to So do the the labors market discretionary awful on lot need to

Operator

Thank comes line Farley with you. questions. Please [Operator Robin of first with Instructions] Our proceed question the your UBS. from

Robin Farley

around just down just market any potential I so our short which Hi. guidance little anniversary a are of or or changes like having is, do have I just is transaction if harbor now? wonder questions. another bring overall One escalators REIT in And some would color, for guess gaming you think there you just Thanks. some what question national that. it XXXX, then two your some a the after picture your opening still color bit rent bigger maybe it you is

Peter Carlino

we last When other I that estimated That's out of guess escalator the the year, of escalators at you that escalator, we'd point of full the estimated practice to got the roughly Relative take - I'll X.X, the results been highlight to the the fair high they headwinds second. had potential of next we X.X to Penn quarter, which visibility. is is the came one on of end get we've escalator would that and question. it's second. that X. we And include was a certain million. the I get would until that the take in, we did, November Bill were where we're not going we actual take from our get to I'll the first

are. in the are And margin me decided And obviously is so not when our close how much that to include what they variable the escalators we tell very reason, incredible guidance. relative to are to have you escalators for that especially

likely at going escalated kick than it a will XXXX. think think or a of more Penn the max leaves on I And escalator terms and road the XXth, the that would therefore escalator That better the us in is in good they conservative shape and cushion would which news with Pinnacle come in I candidly April to in. probably the million more even speak. so have that Penn by down escalator be X.X basis

target X.XX, coverage clarity, ratio highlight, will that if that year-end revenue work, will X.XX reset impact on taking reset, not year reset. next they would obviously rent reset Is think they their calculation revenue if they there revenue that guidance a addition sufficient of the on them a that's those so that year five give included estimate next November XXXX. escalator that is would rent have the I full we calculating year. be coverage when in The before Penn So color the be the for escalator? would cushion their would - the be has for and the the way And that

Robin Farley

out then great. another having that's there? gaming the Yeah, impact Thanks. lead of And on

Peter Carlino

from That found just assets maybe that mean does think have to experience our overpay the saying they I'd will people has each current for Yeah, view prefer wouldn't. that and of other going some inevitable. will where would play, us that. we more on players monopolies course kind there point point our of we field think markets be it like happen. found Look, occurred could of that the no that were [indiscernible] that I and I in of without in what competitive, rather can are would we it's

all yet, think XXXX. we So to what and we still to have it's at our think I this know have looking I wait on see - early plate We how plays out. have we

by that thought? some every we just and see. We beyond and deal wait are you to day, that Steve, I offer of want kind encouraged that with think you

Steve Snyder

where see point your going resources. to the to And impacts going on early the it is is our that think to for their are accretive at newest the or too kid I the of transactions continue what be. at block look focus doing what No, to parties is too of remain It's end disciplined are the shareholders not. only their see regardless we're to to going day, that and early

William Clifford

add the actual I that effect the worth million been we of averaging about thought in I as X.X transaction. and have Penn previously so well amount that effectively would am effect Yeah, would saying the transactions billion our I did be, year was transaction. roughly say would just transaction transaction that a of combined equivalent, about would of of last that Pinnacle XXX year of expectations we the as

kind and transaction. the the reset it XXX at Tunica and as we've now over going the that would with the year. said future, that We delivered I four would look and argue that we am year to we long a transaction, of Pinnacle kind class And reset XXX I year. haul, said to million will coming again the Pinnacle far historically that comfortable we get the as need that reset a effectively original on into I look the thus over transaction the with we've we again last we towards forward fifth still our So and years of

transactions fantasize done, in for to would I four on a So having you delivered think a move get nice haven't done we it having starting I now point we that where industry. done, we already, we'd our track know about record year, million work us trajectory of But it done. every to not and done the whether that's year in XXX gaming million it's the it have works XXX the multitude way transactions that for way be or of got we which

that we're lost that or or - So I still my haven't enthusiasm commitment we're expectation hit target.

Peter Carlino

We've the is pretty inception. foremost can first of me a and And and that speak Again voice happen there. camphor dividend look let with done kind a that's that one, focused Well, of since growth. to that on and add a I've future forward terrific shareholder been result shareholder, with as I only growth. I as looking totally am job about what

by So what this been we'll has discipline been we've this what at forever I the word think of of about used table and kind remain. each that's is

So core always forward as it's step that most. protecting we matters

that hope our feeling. you answer I about So gives an

Robin Farley

you thank great, That's very much.

Peter Carlino

Alright, Robin, thank you.

Operator

you. Thank

from proceed Greff with JP Our of comes Please Joe question line the next your with question. Morgan.

Joseph Greff

Hey, everybody. good morning,

Peter Carlino

Hi Joe.

Joseph Greff

Maybe that's pursued characteristic there deal been not but pursue that than another other environment have guys maybe now? not accreted about you've for mentioned you of a are earlier talk you right that talk would what at fail to not M&A Peter, that been or way the or been you acquisition present the asking time. to about out careful the pursue you, for

Peter Carlino

of is and the I quality then of make X Less try I quality asset mean the am as what like but item I again what the X and how it Well care X, the a they voice flow plenty, the it out more that asset stability prices and the to or focused quality. of is. one liable looks on probably and much of the earnings. is that cash really speaking

want we know Bill to. a more, you don't I can So lot add

William Clifford

comfortable it. in to X, No, at XX gate going to projected doesn't tougher. able I long with, What very machines markets around were though, them markets a risk there feel as of what only to There we a that to that of much in in XX, out to make get we that's listen - recovered they comfortable We challenging what think And is big term be the obvious; we analysis to the in particular there think But property on see is kind one not to certainly an you what what to it might comfortable we're huge and improve with and cash some market in can back we we getting or a I more that upside so that are take we XX, nice those There not prices we price the being to the prospect whatever - out look forward, the is pay happen can't of back market. come sure may a but how is them we mean challenging be we of what the rent are going go going going mean we market. we - if inclined participate quite revolves of are ranges flow coverage to I more at want of we were markets particular paying example. meadow relative that the stable are upside at years we'd do a target what is call always know some other and markets. part where some be obvious. less look the multiple

forward the work more that an other we to and cost whether For to it good to with it's be to but assets transaction. of some about challenges collateralized we might is collateralized is the have might and want another factors if will going that this of move inclined do going that asset be cross with number tenants type

and of impact art. but part totally as it of That and So you a for per it's pay to rest science. here's get a AFFO what I little a and art want combination you can going it in a to the The bit look of is take science am rent bit on of what and I not science, what little science be here's comes share.

Peter Carlino

Thank you.

Operator

Thank you.

of proceed question next Please Carlo questions. with comes Our your with from line Santarelli Deutsche Bank.

Carlo Santarelli

think some stuff talk Hi, your holistically good the opportunities isn't have that discovered so you maybe obvious of structure deals, as for, kind maybe guys, industry have you've the through of about federal bit maybe of guys some the way just about fallen process? morning. Bill, you the would that tax gone changing maybe that that little the could has altered a how

William Clifford

most You rate, tax start, always combined target know tax and confront. almost for they've we always looking cases think the at land many got a of the the impact separation is because on operation where that and building tax us and a challenge it's kind building fact rate I separating is the meaningful effective have of assets and the the when in and some most land many, operating cases which

guess tax can I of kind kind to So starting rate is implications to the know the to for so of that and they now be of the terms are and be what also pay clearly understand reducing people people decision helpful. going in while helpful a It just are. make laws the are where

think going done, prohibitive they was I that but completely get not enough it a set tax the that they think people to am that could mind future kind would I a I ignore of high to say getting price. transaction

do at they to a transaction outlook I the look is that's what be make got terms and fairly an Now in future asset take can tax a and my I out that of we've can want I kind lays on relative and the stable for of decision of foreseeable consequences taxes future. might recognize know the to monetizing a going to way the stable, what that

Carlo Santarelli

position a be of So, REIT for say the this helpful than ago today at believe done least transactions are at go least basis, were the should fair gaming a on the better kind getting forward is that more so year then be to overall on guys you this would it time? that policy at a you industry you

William Clifford

helpful a think which take nuances and with on in included are are other that and I companies I that. expenses get can more is There people that. highlight limitation there's expense which of I'll couple is a we comfortable think interest that little Well not rent

is book that the for could actually tax looking some into deductible that the whereas the incurring but carry the expense future. their interest might people rent is on also the while not they tax for might that be reality fully deductible be that not people be So they they pay but some asset helpful

Carlo Santarelli

Great. Thank much. very you

Operator

you. Thank

comes from of Please Our America. your with Bank of next Shaun question Kelley with proceed questions. line

Barry Jonas

a Hey, Jonas. Barry this is

by fund over share else? the Is maybe First increasing something issuances M&A or recent question, guidance to XXXX. in has diluted $X million this ATM using count share

Peter Carlino

No, the basically the as north performance are in relative the fact top share three shares of those we in that's as the the January the year performance, REITs restricted granted the performed period. besting timing XX% that or well to XX% of over were of that last

Barry Jonas

Great. And then…

Peter Carlino

but there's lot in of options ATM. few a There expected not options a

Barry Jonas

Okay.

a into associative amount not the count? share cash of coming So with material

Peter Carlino

No.

Barry Jonas

in Great. influencing an now, perspective? And rising environment rate to mean get impact maybe business your then just about you it how thoughts I particularly this we're multiple to directly your from or triple net, obviously talk on the want interest but M&A see there's just

Peter Carlino

a relative are you in transaction perspective a as expense obviously earnings our the to and course the ourselves had triple But And are inclined alluding as have they can Clearly kind impact as stock interest three of we we've net what's it's release term cost implied of degree stock in think what into price than the what long account debt news looking look to our assets not with on where of environment implied expectations part in talked terms your would trading we to and equity of rate it's have. expectations take more into well you bonds trading about your rate have when term. over what cost were it of the less others the - we hit or take are of all over significantly a from that to associated of a in we basis we're a net an great months, be. triple component factor going last year the capital their calculus And debt terms take at although what been your the your or certain or for current Well, the have rather interest to kind of pay of included acquiring obviously has asset be factor the in longer then to you're equity. an what own much debt. this that's ten

Barry Jonas

still, Got Last prevalent Thanks. just based asset it. I'm if one, you model the mostly around valuation is or have gaming has from remodel still the back become, you owners concerns now liability? given how curious push if

Peter Carlino

it's on can in so from be transaction it getting and than is answer. should I way again of current patience property Bill it's of don't on to you that one that it sell numbers stuff another think despair the not most means presentation, to owners wonderful that mean move guess when effected calls they would enough we're others money senses hard that a they need at to wished reality We but but trades and need done most gets these want as really that's people think caution, it. were particularly. kind do, to It's be wonderful. about in some as of some said meaningful kind certainly might like, transaction. different for I of and long the instances, has they reality. there's we I this have will - enough that just occur some they're reason thinking things a But really involves think see see I or that's less or we certainly for mean We some

something. like in to otherwise actually give seeing gotten We to have do actually to out us I we've don't would not to we're going was call, your and world. converted just with anybody that sell theoretical we've we're say, you don't the of to that I know convert asset you probably hey looking anybody phone That's think what

William Clifford

about trust REIT. work. and that the encouragements. the that assets one, transaction. the gaming endorsed Generally the ownership people the out model completely about I point would I model, completely there don't I'm said there existing helpful three largest endorsed that's portfolio thing speaking acquiring real really argue is term gaming gaming I afraid are players they've are investment think their on is they've had it I've companies just other that do I transaction. of saying I does I And take not model the that but think think kind long they're relative would asset. that all of turn the Gaming oriented think from one mean are think run Boyd it before Peter's for what certainly your I that domestically own reluctance and point the of they're lost is, doesn't to invested industry. echoing is around for another a don't Penn And all going within I then in Pinnacle I and of the addressing that and are and mean estate of to their

concept a they I stage a do reason not. monetize to want or into again are think a transaction they're it's at looking that to of something they for whatever

sell. them think where they're and do something don't to going really That there's unless sell, I major tend people a to stay reason to generally another there's at there not way unless decisions they that. make to compelling

Barry Jonas

so Thanks Great. much.

Operator

you. Thank

Our next Stanley. proceed Morgan Thomas the with of comes Please line Allen your question with question. from

Thomas Allen

have I XXXX? think about been for versus thinking Thanks. a good how positive rent expectations Hey, has variable year, this you been Ohio morning. The

William Clifford

were better. took so then that that if Ohio than than mature level go I a that such you growth the they year, in same rent climbing a one we because back in Ohio I the you things at - rest surprises And we markets necessarily there are period. penetration have be of continue the for going it expectations think put be forward. to very market. other kind think, rates The short of much expect American. kick original takes this into always are so a good unfortunately that time wouldn't I I little a your for Ohio, will that had while pleasant will be new within will better to they those supply every think most brand I see would Ohio to but longer the in transaction,

I of another that properties that been So them. I better performer And I time. a well. the no won't would It's doing say should for our same Ohio depends, a rest terrifically it be excellent the expect portfolio. great are percentage expect Yeah, than way be this reason year Ohio year rent think the all as to

Peter Carlino

will just what's what reflected included or I for we've guidance on color their the be our get is to much Ohio in some has will within to say paying they - expectation Penn how rent properties.

than have that is So guidance correlate clearly better perspective individual I much think to going do. They from correlate, properties theirs. a we they visibility to what's on the at

have, we're we I look numbers. make kind numbers how guidance. their of them, they going that's sure look they And to got we the but insides they So do our of to in think of default do, at don't some getting and to are to that short reasonable

Thomas Allen

there? is in growth revenue what guidance imply terms So, your

Peter Carlino

I class - those you think really - would I mean should ask - my can't are depend. two, would of for fall one, like that I proprietary is I information that into numbers; that the

So ask free to them. feel

Thomas Allen

international Alright. there you takes ever a just underwritten look and an and been that? at deal underwriting quick kind follow-up question. what of of And or gives then Have are

William Clifford

you've get got obviously currency stability transactions and We've you some flow, income treaty have. cash How always concepts easy, U.S. gives the free it matter tax what are best definitely and a not that to also REIT a manage can your so might such guess way foreign and money I be The then with back assets the or into foreign the recognize the - how qualifies that in doubt perspective the overseas. there and then and of and for individual takes countries of in really are looked U.S. country We it's have how that what they taxes the you and clean. income, assets over REIT the tax are It's whether structure how happens purposes transaction you effectively REIT in description. it's at the that's that do you a

some - So some spent transaction the issues. time, for we that, not a other we've but at money for spent we issues looking didn't tax we've have get so to

not we we at States tricky. country. are a between the that open United sometimes it's get is cut look to task haunting clear especially will So It treaty that, can and definitely and so there that really a

Peter Carlino

it. cash located. source wherever emphasis maybe that's point that the a qualification flow I Yeah, reliable We open mean subject Bill of to good remain provided. to to any

something do of we we our a outside lot would locations attract stuff So yet see but least current that and this industry at that to have look us. at

Thomas Allen

Thank you.

Operator

you. Thank

comes of question next Katz proceed Please line from with questions. Telsey. David Our your the from

David Katz

Hi, gentlemen. morning, good

Peter Carlino

morning. Good

David Katz

you Obviously larger the am set acceptable And of suppose what I Atlantic around profile or opportunities issue those a you you Las whether know tend focusing interesting list. not that along not larger line the a thinking And from of at Vegas to did you wondering and view I and you buy bit why present those be where do I for you that think would themselves? different risk How scale. City or things with perhaps matter, am a just know would on be are some single those properties boundaries. for would they I on view

Peter Carlino

time higher about. times from are perspective not, in words so other Vegas combination that's when bad great, result what that horrible my good in times of terms time a and are volatility we coverage think A Las that something are have from are rent when perspective,

responsible we're to than for those some to because people the not factors competitive. important be not going CapEx seem CapEx something then The relative isolation reality and for cash that operators the but for gaming those significantly in reality. by higher that's know - able ironically be EBITDA maintenance whatever you say the that's that relative they stay the So you maintenance to Las just stable which would to their to maintain with sure than Las cause to flow, say does for is generally model. make us and it concern expectations to in you in requirement that regional higher not willing what higher it but Vegas necessarily are than shouldn't factors what are is Vegas would in multiple that be And reason going pay where building

is that part effect and of all world have proceed the and in those multiples. could therefore we I cause don't open think causes there if for - tail that's And so with that to Las transaction a are don't that huge in because in we know not in of Vegas is do transaction of to that I on recognize that of I what there am what Vegas. Las gaming we center Vegas speculation terms sale term expectation However to long alluded. do that's I we you likelihood if - that particular you but Las Vegas get available not Las alluding know the going any the in for assets still

candidly say that's I've has what last few or same what getting properties closing. has not is some know around if kind risk the of the as kind volatility but of would or properties of sales of expectation couple pretty Atlantic a couple characteristics you lot it Relative benefits of and is there City the Nevada has Atlantic us experienced the that to anywhere lot terms factors price likelihood of of I in So the near think of involved low. years and heard, City, of of a I is

to I is then reopening going Revel. know revisit what Rock not think forward, there happen going as may the is City times Atlantic I look obviously with tougher think of and to may or kind and we I the of Taj/Hard some be that that's

City of like is got have looking - everywhere No space surrounding facilities it's once left in. coming if a competition I some well, City much. no in have coming supply say you it's in know is Having Atlantic can it. new stabilize, you Atlantic at don't I market - any Atlantic see add City that's got terms we is to look I we think normalize stable necessarily and So entire don't new there think has more once gaming growth kind and that there look I going to to very starting all that, in said to that been facilities. know of

are own the be predict we'd time, forms price. in are view. maybe my say you seeing So that North to to you Vegas Jersey. but it's of one That's Las just to in just right didn't would interested That's all maybe answer I there. at in They have their the going to to see I day Northern or or a New going in gaming York to New I potentially more Jersey guess business get York. is add will

then we what health And City, the and reasonable - the right dynamic than reservations thing Atlantic is is you bloom you about of the We the in it's operator now how so is market it's and I Las viable ups of the be have City putting bloom guess, be know and downturn. of much expectations just no that in the in downs Vegas, nature no Atlantic would it. more - nice are City, Atlantic way think would a general in secular the more would there there

David Katz

Right, okay.

Sorry, go ahead.

Peter Carlino

invested I I that no Las Las inadequate return the and that to so and look we do on look kidding. on the capital Vegas way appendix add to that. say return at that average going was you Vegas in at we capitals, think to is say There's with issue be back got and going

Ohio, of XX% in, kind property numbers, than Let's excited Toledo, but take a deal Performance property you pick what get better I the we anyone could terrific stuck that's cash-on-cash spend. I tell won't, money just real for the we about.

if with satisfied, would say was seasonally, I'm look a it's deal well, that if I more shack your beach. dependable. would to we on the speaking broadly poison great were do flow So cash we the and to going a and pick you're

than I see are few more well the mean Go are of chosen”, plainly kind I it it. Bible that I but can't that think that's way “many say line we So ahead. but the called with

David Katz

I've Well, answer the the and which that know before up gotten to quickly, sell you around anything? circumstances to set wanting consider would question just of look asked I follow wanted I but is a there

Peter Carlino

I selling Sure, any incredible happily our shareholders, asset. sell somebody of see in mean that absolutely to at of price want best don't this some we'd it point. leases but do that interest offer the Us, I it's

William Clifford

currently hard things have and worked we looking to the to we Yeah, of we the that at have some continue intend the get horizon, on we scale to grow.

So we're not in going interested backwards.

Peter Carlino

Understood.

very Okay. much. Appreciate it. Thank you

Operator

you. Thank

next line with [indiscernible]. comes the proceed Please Our your questions. question from of

Unidentified Analyst

morning. Good

Peter Carlino

Morning.

Unidentified Analyst

So touching an train as how mean Meadows? casinos a weigh just that the quickly versus revenue there, on touching and Penn out opportunity at I do on Pennsylvania many and you on

William Clifford

within that That's Meadows Well, Pennsylvania that the well and there's will downtown impact area did they're within new Penn it. impact work. last that process XX river, think the such that Meadows more systems comfort we hand an just I not is for have the And have acquired on zones National. I can the that I sites the the on think Penn be mean could In doesn't protected that, that Pittsburg would like wait It that is state. fact from for National they protected something the how on much and is in in think be protection the and I there my take mind think Pennsylvania. mean market going the by to market the affected between some over, We tax Penn that they're is pretty to well or going other casinos Meadows impact a XX the the to National been license Penn sites new site. or the it more give some largest have can't very probably isolated see a were have obviously exposed. range given really the them any facility, that I think a

Peter Carlino

you Northern I you hard which largest on had though. New be the north by market of coming look been and mean west, market an but you're have available the Penn in in if outsider don't would we of cows at market States. there, them, south to look the really that why available care York, the are that Penn I mean probably way largest the Not kind is the much about would protected Maryland

think I and very So up very, move Penn yeah did in fact well a lock their to with on that smart part.

lot exposure just go of and there's don't posted east to because I Penn we potentially of Further are of think Russia a lot going that and we're somewhere So King places to have not National. where between around it's people possible, there's see. can a wait just but

but. Bill this today the There enough not call it's not there think yeah interesting to there morning to to it think be just right, state, still two sites, I more work out. spaces all said nowhere still auction I going Penn that how are on said itself in another is But isn't sure that today, see plays will and its XX. go

each On fine. so the very economically because well way do site done they ever than other on hand imagine, could States they going got more they're

Unidentified Analyst

do in market you're there in bidding Understood. this coming does is there, And states? or on the going and where guys you how Penn opportunity of something then there's to some additional some other I that have mean to look think it attractive operators with an competition opportunities now you either acquisition these

Peter Carlino

and I There have and - terms we our could interested think what these how of not think to in are relatively some at we be, we'll There mean and in, belief facility, don't new facilities I those small huge these could transaction. that plays would participate be - listen, yeah, that will wait within in. machines to are have imagination be we facilities. XXX modest finance be your I something could don't think see and table that they're look to any well we stretch limitation going relatively could with say I be, is be I out. by the major of going interested

wasn't for that the couldn't We project National it In miles facility. Greenfield XX it but have relative by have. ways. XX somebody done was - Penn works able being was us. it the Penn wasn't mile type we a would in if that It being of works tenant the participate zone protection to National both to if it Penn for a also works the or We

facilities these how all wait just end being to are of see think up placed have where capitalize. we they So and and I

Unidentified Analyst

stated And structures four PNK's pretty sense. it's I lease negotiating similar with and looking Make out? know is then stone and any guarantee. those properties call there way to look those future with well to more lease their structure go Okay. on that they laid existing out but without mean to of corporate the is the kind steady been or I leases Boyd,

William Clifford

we to think guarantee, coverage default ratio. the issue the said and got did I a what corporate is much of higher address we rent

if the - that the the guarantee is only assets if of parent struggling. asset the are So end day care at the about you time a

a otherwise not the gives guarantee there when And in if those falls the got those ratio which lease given earlier rights have assets company we ability to for parent the that having that would parent other is to much us negotiation exchange guarantee. the a relative higher much aren't fall, so an we've which and performing have

Unidentified Analyst

Okay.

William Clifford

the And and These support in I so rock as one can are don't much their solid players concern strong about outstanding assets that well established there's they get. safe mean it's a there. markets, think other, will you I

Peter Carlino

Yeah, between them. cross are collateralized they

net got assets are that collateralized. the within cross they lease So

Unidentified Analyst

you bit, then timing the the going Penn then guidance PNK direct kind and rent April of direct move well with November? down the around financing a is of that at lease looking the straight-line in That straight-line financing with straight-line that move reset of kind as that in will Is is to little lease. makes the move just sense. down all rent And reset

William Clifford

impact for on direct that be deferring EBITDA the being amortization rent flip the sorry. goes a we've lease financing lease do the straight impact anything And been line amortize to be that will and No, with of that just basically then financing or the it it's that. down overtime doesn't - That year we piece five will actually fixed direct no rent anniversary will years we're net over with line have AFFO. Penn, because variable of rent originally or it, The be is that that the for the deferring all to year to portion we've the deferred. of of the at rent straight-line that end instead original anniversary, will recognized were five recapturing part, take that clarity, years then which to through be tenant which of previously on then will of XX was required the five the there the that period, initial the straight the

both seeing and a much meaningful which However, will dramatically net FFO both you more XXXX. of portion that in are in increase income and be will XXXX

Unidentified Analyst

And the straight-line. understood on

financing it doesn't because out, the the and take the lease So if deferred higher full run XQ just you you year? with will that just at change all it than be

Desiree Burke

being lease financing increase a Pinnacle deferred add in as adjustment financing deferred inside it income rent line will because XXXX. actually recognized really back occurring lease to receivable, just due The as and rental that that's it gets reset in

Unidentified Analyst

Okay. Yeah much. you that's very And that thank me, makes for it sense.

Peter Carlino

you. Thank

Operator

Please comes your Our [indiscernible] from Thank questions. of the line with you. Instructions] [Operator question next proceed

Unidentified Analyst

guys. Hi,

transactions, U.S. Just this what Pinnacle actually recognize Penn, and basis? it on year Boyd, contribute in think to excludes may come speculate numbers question, the on when it care guidance pro quick forma may you

William Clifford

that They mean I have inside indicated half. has to Yeah. expected much clearly the timing. to in as they Penn close the second better

not with in regulator really going it's with think been And at that the They're call going what all got the that how think I in sometime means - as no Penn participant. a that two I plus States. middle the of more probably there's would got the I information Pinnacle, we of you but their I in is the speak but combination way of the third gaming and they having that minus certainly and kind party you it think we're got actively you invited away, meeting, obviously license entities, got also three a but really alluded I any than got. on have a they've better have SEC to regulators to

get have to But then which has in that you've from We who's get to got as Boyd, States started scratch. going well. the license license in

inclined to takes a if anywhere and it's going getting shorter. more complex get to new brand process, it's it's even months gaming particularly typically if to than the a in licensed think year to the licensing entity I it longer through nine So from that's industry be be entity

Peter Carlino

no comment, we Let this to this done getting time. this obstacle me make see at

put me mean. who's the a general October, sitting general right any on next a Now out view to to I'm knowledge, going could counsel inside who offer without I September, spot,

Brandon Moore

to mean of on haven't Penn ultimate certainly on and to the think direct But guess, Penn respect by states in there will say, and us. timing been Boyd more have timeline. are contact will tough they It's the pure a those applications discussion be. the and is If with to I on clearly encouraged conversations I been that I we're do would having have than obligation, in be a With have discussion part Massachusetts, the within in where the we what and we having you Boyd and some to again, I be they're had states the defer or we've timeline that their speculation. key there think them or are Boyd

Unidentified Analyst

recent respect on to popped has of your spoken Got progress it. - on or But with not occurred that how down might with up Massachusetts and front? they're that have whether events the since trying stuff you things them given of slow because side any win

Peter Carlino

Penn's both Gaming. the with with have like will of have now any because timing are previously no they're believe our reason review in Penn the those that reviewed that the with before here the company company look to win Several suitability from on of GLPI impact our We connection that to of National respect were doing spinout analysis review.

is will won't not for believe the stranger a significant that here perhaps to any have and And us. so the timing Massachusetts. And quickly that on get everyone application we the impact

Unidentified Analyst

Great. I thanks, guys. Well appreciate it.

Peter Carlino

Thank you.

Operator

at Thank you. to back for other will the there turn I floor no you are questions comments. Carlino, final Mr. any time. this

Peter Carlino

We're Okay, thank results dialing see pretty all this happy and about on excited year what in you the well thank for about very last our and you horizon. much morning. we

see with next you So that quarter.

Operator

today's teleconference. concludes This you. Thank

participation. disconnect your time. may you at this Thank lines You for your

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