PENN Entertainment, Inc. Files 2023 Annual Report (10-K)

TL;DR

<b>PENN Entertainment, Inc. has filed its 2023 10-K annual report detailing its financial performance and business operations.</b>

AI Summary

PENN Entertainment, Inc. (PENN) filed a Annual Report (10-K) with the SEC on February 22, 2024. PENN Entertainment, Inc. filed its 10-K report for the fiscal year ending December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. The company's principal business is classified under Hotels & Motels (SIC 7011). PENN Entertainment, Inc. was formerly known as PENN NATIONAL GAMING INC. The company is incorporated in Pennsylvania (PA).

Why It Matters

For investors and stakeholders tracking PENN Entertainment, Inc., this filing contains several important signals. This 10-K filing provides a comprehensive overview of PENN Entertainment's financial health, operational performance, and strategic direction for the fiscal year 2023, crucial for investors and stakeholders to assess the company's current standing and future prospects. The detailed financial data and risk factors disclosed in this report are essential for understanding the company's market position, competitive landscape, and potential challenges within the gaming and hospitality industry.

Risk Assessment

Risk Level: — PENN Entertainment, Inc. shows moderate risk based on this filing. The company operates in the highly regulated gaming industry, which involves significant compliance costs and risks of adverse regulatory changes, as indicated by the detailed risk factors typically found in a 10-K filing.

Analyst Insight

Investors should review the detailed financial statements and risk factors in the 10-K to assess PENN Entertainment's performance and strategic outlook, particularly concerning its market position and regulatory environment.

Key Numbers

• 2023-12-31 — Fiscal Year End (Reporting period)
• 2024-02-22 — Filing Date (Date of submission)
• 000-24206 — SEC File Number (SEC registration number)

Key Players & Entities

• PENN Entertainment, Inc. (company) — Filer name
• PENN NATIONAL GAMING INC (company) — Former company name
• PA (company) — State of incorporation
• 2023-12-31 (date) — Fiscal year end
• 2024-02-22 (date) — Filing date

FAQ

Industry Context

PENN Entertainment operates within the highly competitive and regulated casino and gaming industry, which is subject to economic conditions and evolving consumer preferences.

Regulatory Implications

The gaming industry is subject to extensive state and federal regulations, including licensing requirements, gaming taxes, and operational rules, which can impact profitability and business strategy.

What Investors Should Do

1. Analyze the revenue breakdown by segment (Casino, Food & Beverage, Hotel, Other) to understand performance drivers.
2. Review the Management's Discussion and Analysis (MD&A) section for insights into operational strategies and outlook.
3. Examine the risk factors section for potential challenges and their mitigation strategies.

Key Dates

• 2023-12-31: Fiscal Year End — End of the reporting period for the 10-K filing.
• 2024-02-22: Filing Date — Date PENN Entertainment, Inc. submitted its 10-K report.

Year-Over-Year Comparison

This filing represents the annual 10-K report for the fiscal year ending December 31, 2023, providing a comprehensive update compared to previous filings.

Key Financial Figures

• $0.01 — ange on which registered Common Stock, $0.01 par value per share PENN The NASDAQ Sto

Filing Documents

• penn-20231231.htm (10-K) — 3937KB
• pennex106123123.htm (EX-10.6) — 100KB
• pennex1017123123.htm (EX-10.17) — 128KB
• pennex211123123.htm (EX-21.1) — 95KB
• pennex231123123.htm (EX-23.1) — 7KB
• pennex311123123.htm (EX-31.1) — 10KB
• pennex312123123.htm (EX-31.2) — 10KB
• pennex321123123.htm (EX-32.1) — 5KB
• pennex322123123.htm (EX-32.2) — 5KB
• pennex97112312023.htm (EX-97.1) — 20KB
• pennex991123123.htm (EX-99.1) — 45KB
• penn-20231231_g1.jpg (GRAPHIC) — 151KB
• 0000921738-24-000012.txt (&nbsp;) — 22604KB
• penn-20231231.xsd (EX-101.SCH) — 138KB
• penn-20231231_cal.xml (EX-101.CAL) — 187KB
• penn-20231231_def.xml (EX-101.DEF) — 853KB
• penn-20231231_lab.xml (EX-101.LAB) — 1646KB
• penn-20231231_pre.xml (EX-101.PRE) — 1203KB
• penn-20231231_htm.xml (XML) — 3875KB

Risk Factors

Item 1A. Risk Factors 10

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 27

Cybersecurity

Item 1C. Cybersecurity 27

Properties

Item 2. Properties 30

Legal Proceedings

Item 3. Legal Proceedings 31

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 31 PART II

Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 31

Reserved

Item 6. Reserved 33

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 33

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 53

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 55

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 119

Controls and Procedures

Item 9A. Controls and Procedures 119

Other Information

Item 9B. Other Information 121

Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections. 121 PART III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 122

Executive Compensation

Item 11. Executive Compensation 122

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 122

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 122

Principal Accountant Fees and Services

Item 14. Principal Accountant Fees and Services 122 PART IV

Exhibits, Financial Statement Schedules

Item 15. Exhibits, Financial Statement Schedules 122

Form 10-K Summary

Item 16. Form 10-K Summary 123

Signatures

Signatures 130 SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS This Annual Report on Form 10-K contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are included throughout the document, including within "Item 1A. Risk Factors," and relate to the business strategy, prospects and financial position of PENN Entertainment, Inc., together with its subsidiaries ("PENN," the "Company," "we," "our," or "us"). These statements can be identified by the use of forward-looking terminology such as "expects," "believes," "estimates," "projects," "intends," "plans," "goal," "seeks," "may," "will," "should," or "anticipates" or the negative or other variations of these or similar words, or by discussions of future events, strategies or risks and uncertainties. Specifically, forward-looking statements include, but are not limited to, statements regarding: the Company's anticipated share repurchases; the Company's expectations of future results of operations and financial conditions, the assumptions provided regarding the guidance, including the scale and timing of the Company's product and technology investments; the Company's expectations regarding results, and the impact of competition, in retail/mobile/online sportsbooks, iCasino, social gaming, and retail operations; the Company's development and launch of its Interactive segment's products in new jurisdictions and enhancements to existing Interactive segment products, including the content for the ESPN BET and theScore Bet; the benefits of the Sportsbook Agreement between the Company and ESPN; the Company's expectations regarding its Sportsbook Agreement with ESPN and the future success of its products; the Company's expectations with respect to the integration and synergies related to the Company's integration of theScore and the continued growth and monetization of the Company's media business; the Company's expectations with respect to the on

BUSINESS

ITEM 1. BUSINESS Overview PENN Entertainment, Inc., together with its subsidiaries ("PENN," the "Company," "we," "our," or "us"), is North America's leading provider of integrated entertainment, sports content, and casino gaming experiences. As of December 31, 2023, PENN operated 43 properties in 20 states, online sports betting in 18 jurisdictions and iCasino in five jurisdictions, under a portfolio of well-recognized brands including Hollywood Casino , L'Auberge , ESPN BET, and theScore Bet Sportsbook and Casino . In August 2023, PENN entered into a transformative, exclusive long-term strategic alliance with ESPN, Inc. and ESPN Enterprises, Inc. (together, "ESPN") relating to online sports betting within the United States. PENN's ability to leverage the leading sports media brands in the United States (ESPN) and Canada (theScore) will position us to significantly expand our digital footprint and efficiently grow our customer ecosystem. This highly differentiated strategy, which is focused on organic cross-sell opportunities, is reinforced by our market-leading retail casinos, sports media assets, and technology, including a proprietary state-of-the-art, fully integrated digital sports and iCasino betting platform and an in-house iCasino content studio. PENN's portfolio is further bolstered by our industry-leading PENN Play TM customer loyalty program, which offers our over 29 million members a unique set of rewards and experiences across business channels. Reportable Segments We have five reportable segments: Northeast, South, West, Midwest, and Interactive. Our gaming and racing properties are grouped by geographic location, and each is viewed as an operating segment with the exception of our two properties in Jackpot, Nevada, which are viewed as one operating segment. We consider our combined Video Gaming Terminal ("VGT") operations, by state, to be separate operating segments. Interactive includes all of our online sports betting, online casino/iCasino, a

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View this 10-K filing on SEC EDGAR