Ohio Newspaper Association Working with the Casino Industry Alan Silver Ohio University May 16, 2013

US COMMERICAL CASINOS

Spectum Gaming Group The analysis offered the following GGR projections for the year 2013: Scenario 1: Four casinos with both slots and tables games could generate at least $1.8 billion in GGR at the following locations: Cincinnati – $369 million (Est. $230 Million) Cleveland – $568 million (Est $ 263 Million) Columbus – $602 million (Est $230 Million Toledo – $265 million ( Est $182 Million)

Spectum Gaming Scenario 2: Four casinos with both slots and table games along with up to 2,500 VLTs at each of the seven existing racetracks in Ohio could generate nearly $2.25 billion in GGR:

The average GGR per casino/VLT location would be $205 million. The four casinos with both slots and table games could generate $1.1 billion in GGR (48.9% of state total), or average GGR per casino of $276 million. The VLT casinos at the seven racetracks could generate slightly more than $1.15 billion (51.1% of state total), or average GGR per VLT casino of $165 million.

Moelis & Co 2.7 Billion GGR from both casino & Racinos (VLTs)2.7 Billion GGR from both casino & Racinos (VLTs) Assuming cannibalization from having both, the total market is expected to be $2.3 billion at a steady stateAssuming cannibalization from having both, the total market is expected to be $2.3 billion at a steady state

Where did Projections come from? Annual Gross casino revenue with VLTs ODT issue 3 Casino Ballot Initiative Memo Oct 2009$ billionAnnual Gross casino revenue with VLTs ODT issue 3 Casino Ballot Initiative Memo Oct 2009$ billion Annual Gross VLT Revenue with Casinos Ohio Statewide Racetrack Casino Assessment/March 2011$ billionAnnual Gross VLT Revenue with Casinos Ohio Statewide Racetrack Casino Assessment/March 2011$ billion Total Casino & VLT Market Size $ Billion Total Casino & VLT Market Size $ Billion

My Projections 1 st full yr. » EST Horseshoe Cleveland:$274MHorseshoe Cleveland:$274M Horseshoe Cincinnati:$245MHorseshoe Cincinnati:$245M Hollywood Columbus:$225MHollywood Columbus:$225M Hollywood Toledo:$190MHollywood Toledo:$190M » $934 MILLION

What is your objective in Casino Management? maximize profit

Margin The Percentage of Win that remains after expenses (e.g., dealer salaries, benefits).

Departmental Margins Department Margin Slots 60%-70% Table Games 15%-20%

Ohio Casinos YTD Tables: 28% GGR31% GGR Slots: 72% GGR69% GGR

Ohio Slot WPD-/ AprilMarch Hollywood Toledo:$215$227Hollywood Toledo:$215$227 Hollywood Columbus:$161$173Hollywood Columbus:$161$173 Horseshoe Cleveland:$216$280Horseshoe Cleveland:$216$280 Horseshoe Cincinnati:$220$283Horseshoe Cincinnati:$220$283 Scioto Downs:$180$193Scioto Downs:$180$193 Thisledowns:$331Thisledowns:$331 State Wide Avg 4 Casinos: $200.43State Wide Avg 4 Casinos: $200.43

Pennsylvania WPD- April State Average: $262.27State Average: $ Mohegan S $266Parx $313 Harrahs $246Presque $230 Meadows $202Mt. Airy $209 Pina Nat $277 Sands $270 Rivers $278 Sugar H $322 Valley F $300

Indiana Slot WPD- April Ameristar 326HorseshoeSI 454 Beltera 240Indiana G 327 Blue Chip 301Maj Star 304 French Link 189Maj Star II 257 Hollywood 301Rising Star 156 Hoosier 277 Horseshoe HD State Average: $ State Average: $293.52

How does Ohio Compare? Win Per day Slots April Indiana: State Average $293.52Indiana: State Average $ Pennsylvania: State Average $262.27Pennsylvania: State Average $ Ohio: State Wide Avg. Casinos $200.43Ohio: State Wide Avg. Casinos $200.43

Scioto Downs Doing extremely well for MTRDoing extremely well for MTR Head-to-head competition w/Hollywood has heated up. Promo Play increased.Head-to-head competition w/Hollywood has heated up. Promo Play increased. 10 Months YTD: $113,314,09910 Months YTD: $113,314,099 Full Year (my est): $135,976,918Full Year (my est): $135,976,918 Spectum Report: $165 Million eachSpectum Report: $165 Million each 7 Million= $1.15 Billion7 Million= $1.15 Billion

20 Key Revenue Sources Integrated Resorts

21 Key Profit Sources Integrated Resorts

22 Las Vegas Repeater-Market Resort Any critical observations here?Any critical observations here?