Q1 2020 Earnings Call
Well consider days webcast. My name is a man and I'll be here, that's cashless today all lines. It takes time.
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I am.
[music] everyone else there.
Ladies and gentlemen, take your free standing by at this time, all participants I listen only mode. After the speakers present patient there will be a question and answer session.
Like to ask question Jay that session you want to press star one on the seller. So they require any further assistance this spread star zero.
I'd like to have the conference over just because they missed Joyce you may begin.
Thank you good afternoon and come to the seeds Entertainment Corporation first quarter 2020, <unk> earnings conference call joining.
Joining me today from Caesars Entertainment or Tony Rodeo, Chief Executive Officer, and Eric Hession, Chief Financial Officer.
Many of the press release earnings presentation slides and a replay of this conference call are available in the Investor Relations section of our web site at theaters dotcom.
Also please note that prior to this call we furnished a copy of the earnings release to the FCC on form 8-K, and we'll file our form 10-Q shortly.
Before we get underway I would like to remind you that today's conference call will contain forward looking statements that we are making under the safe Harbor provisions of federal Securities laws.
The company's actual results could differ materially from they anticipated results and move forward looking statements.
In addition, we may discuss non-GAAP measures. Please refer to slide 17 through 22, which include forward looking statements Safe Harbor disclaimers and definitions of certain non-GAAP measures and slides 11, and 12, which include tables reconciling GAAP and non-GAAP figures I will now turn the call over to Tony.
Thanks choice and actually before I started my formal comments I think it's worth noting.
If you're sitting here in the conference room at Caesars Palace, and we are over six feet apart.
But being in Caesars Palace, which usually has so much activity in energy and it's kind of here and hopefully in the not too distant future will be beginning to move back to normal.
With that said first and foremost.
All of us at Caesars, hoping you and your loved ones are healthy and safe.
The public health emergency Causeway Kogan 19 has created challenging circumstances that are impacting all aspects the society.
Before I provide commentary on the steps, we're taking to protect our business and to prepare to reopen when appropriate.
I'd like to express my gratitude to all of our team members who were on the front lines of our efforts to quickly and safely implement the closure of all our casino properties in March consistent with stay at home orders and other direct is from various government and tribal bodies.
I'd also like to thank those who remain on the job to keep our property safe and secure while closed.
I know the implementation of these directors have placed extraordinary strain or all of our people.
Throughout this period, our focus centered around the health and safety of our employees in gas.
We began temporarily closing our properties in North America on March 14th and by March 17th we had shut down almost all of our properties in North America and internationally consistent with government or tried mandated directors.
The challenges, we now face or uncertainty around winner properties will be able to resume operations.
What that will look like.
And how consumers will react once we reopened.
As well as preserving liquidity as best we can.
In the meantime, we're taking steps to prepare for reopening at the appropriate time and to strengthen our financial position.
Given the unprecedented scale and scope of this public health emergency we can't reliably predict when consumers will be ready to return to our properties, though we believe our deep connection with our guests and our geographic diversity positions us as well as possible.
We're working closely with regulators and government and tribe officials to ensure operations upon reopening follow directors.
We're also consulting with health experts regarding the implementation of policies and procedures done aligned with recommendations public published by public health officials.
In an effort to strengthen the companys financial position and enhance our ability to recover when we do reopen we may be extremely difficult, but necessary decision to temper temporarily reduce our workforce to a smaller targeted workforce on maintaining basic operations.
We have furloughed approximately 90% of employees at our domestic owned properties as well as a corporate and we look forward to welcome them back at the appropriate time.
In the interim we've taken steps to support our team members, including paying impacted employees for the first two weeks of the closure period.
And enabling them to use their available paid time off after that as well as paying 100% of their medical insurance premiums through the earlier of June Thirtyth.
And the return to work.
Furlough team members will also have government assistance available to them as a financial bridge until they do return to work.
Additionally, an employee assistance fun Caesars cares has been established to support team members at our domestic property to so suffer unanticipated hardships arising from Kobin 19.
The fun, which has run run by an independent public charity and managed by a three person board includes two independent directors indices representative is composed of donations from Caesars Board of directors executive team members and other employees as well as partners and vendors.
During these extraordinary times, we're committed to continue to support local communities, where we operate by nominating perishable items to food banks and charities and providing critical supplies. The first responders.
To date Caesars Palace applied hundreds of thousands of pounds of food as wells thousands of gloves mass and bottles enhancing appetizer to those on the front lines.
Additionally, we have contributed cost hundreds of bed lives pillows and hygiene kits to various homeless shelters and care facilities.
Based on the company's ongoing efforts to address cobot 19 related needs in the communities, where we operate donations made by the Caesar salad nation will support local charities in these communities engaged in fighting this public health emergency.
We continue to seek ways to give back as part of our commitment to get through this together.
We've been communicating regularly with our customers during this challenging period, including work hard working hard to alleviate the concerns of Caesars reward members about the program by ensuring the benefits they receive are protected.
We've also worked closely with our broad family of talent, including entertainers chefs and our own bartenders to provide entertainment and recipes and other information to people while they are at home.
As we think about the path toward reopening we will make decisions in collaboration with local governments tribal authorities gaming regulators and help experts among others with the health and safety of our employees guests and community in mind.
We will ensure that our operations hearing compliance with applicable government directors and tribal mandates.
While we don't know the duration or the severity of the economic downturn stemming from this public health emergency.
We recognize that a recovery will take time.
We will be thoughtful and responsible in terms of how we bring the business back.
In locations with multiple clock properties, we plan to phase openings inline with demand and our contractual commitments.
We are designing and implementing policies and procedures in consultation with an infectious disease specialists that align with recommendations from the U.S. CDC and local public health officials to guide the reopening of are currently close facilities as well as ongoing maintenance of guest areas and team member work areas.
As you would expect our health and safety initiatives include among other things.
An increase frequency of cleaning and sanitizing of public spaces in Guestrooms.
More frequent handwashing by team members.
Requiring team members to wear masks while at work.
Implementing social distancing in areas, where there are aligned in gaming area, including limiting table game spots and slot machines. Additionally, non gaming offerings, including entertainment restaurants, and bars will likely be reopened on a phase basis with limited capacity in line with consumer demand and guidance from pub.
Look health authorities.
You can find further details on our health and safety approach in the announcement, we put out today.
Before I turn the call over to Eric I'd like to briefly comment on a couple of business updates.
Few weeks ago, we and Vg properties announced the sale of value Atlantic City to Twin River is worldwide holdings for approximately $25 million in cash.
The transaction is subject to regulatory approvals and other closing conditions.
Valleys Atlantic City will continue to be part of the Caesars Award network until closing.
Following the sale, we will continue to operate Caesars Atlantic City, which will include the wild Wild West Casino and Sportsbook operation and Harrah's Atlantic City.
Lastly in terms of our pending merger with Eldorado, we remain focused on closing the transaction.
Now turn the call it Eric to review the financial details of the quarter.
Thank you Tony Good afternoon, everyone I'd like to Echo Tonys previous comments and hope that you're all safe and well I'll start by providing some details on our Q1 performance and then discuss specifics regarding our balance sheet and overall financial position. Our first quarter performance can be divided into two parts January and February and then the month of March for the first.
Two months of the quarter, we posted our best operating performance since 2008, reaffirming our success in executing our strategic initiatives and our and our strong momentum prior to the emergence of covert 19.
Net revenue through January sorry through February it was up 12% year over year driven by increases in all verticals across all regions highlighted by strength in Las Vegas in Indiana adjusted EBITDAR for the first two months of the quarter increased 28.7% year over year, demonstrating the operational discipline and efficiency that we.
However, circumstances change dramatically in March with the stayed home orders in the temporary shutdown of our network, causing net revenue for the month to come in 56% lower than prior year, while our properties were only open for part of the month cost in March were generally in line with the prior year as we took steps to support our team members as Tony discussed.
Earlier as a result, Q1, adjusted EBITDAR declined 46.3% to 302 million or a 49.5% decrease on a hold adjusted basis outpacing the 13.6% drop in revenue to $1.8 billion looking at results by segment performance in Las Vegas was off.
To a strong start in Q1 net revenue and adjusted EBITDA reached all time highs for the first two months of the quarter was net revenue, increasing nearly 10% driven by growth across all business verticals and adjusted EBITDAR rising 20% year over year temporary property closures over the last 15 days the quarter. However, led to declines in gaming hotel.
Good food and beverage and other revenues, resulting in a 13.9% year over year decline in Las Vegas net revenue to 822 million. We saw a significant increase in cancellations of hotel and convention room reservations during the quarter due to the property closures Q on occupancy decreased set to 77.5%.
And from 95% in Q1 19 as March occupancy was less than half the prior year, while room rates fell just 1.4% year over year. The drop in occupancy drove a 19.6 decline in Q1 Revpar to $120 Las Vegas, adjusted EBITDA totaled 217 million staff.
Around 39.7% year over year are down 43% on hold adjusted basis.
Turning to the other US segment Q1, net revenue totaled 874 million down 13.5% year over year, while adjusted EBITDAR decreased 50.2% to 116 million or down 51.3% on a moral hold normalized basis.
Prior to the temporary network shutdown, we saw robust growth at our regional properties in the first two months of the quarter with net revenue up nearly 15% and adjusted EBITDAR, increasing almost 40% year over year through February we experienced strong gaming revenue growth in Indiana in Iowa as capital projects came online.
Including our new Sportsbook. The addition of table games at Harrah's Hoosier Park in Indiana, Grand and our new Southern Indiana land based property, which opened in December.
Our all other segment, which includes unallocated corporate expenses Cie managed properties and our international operations net revenues totaled 132 million in Q1 down 12% year over year, primarily due to decreases in volumes at our international properties because of the closures all other adjusted EBITDA loss was 31.
Million flat year over year, primarily due to $13 million decrease at our high end international properties offset by a $12 million reduction in corporate expenses.
In light of the property closures since March and our inability to predict when mandated shutdown period may conclude or at the pace with which our business may recover after reopening we've aggressively managed all of our operating levers to put us in the best positioned to reopen our properties it's appropriate time.
First were conserving capital in the first quarter, we spent 109 million on maintenance capital and 75 million in development capital primarily related to the Caesars form project as soon as declines in the business were evident we stopped all capital that was not critical are contractually obligated.
Second we are reducing operating expenses and discretionary spending has been postponed indefinitely.
These actions will significantly reduce our operating expenses going forward lastly, we're focused on preserving liquidity to increase our cash position and enhanced financial flexibility during the quarter, we fully drew down 1.14 billion under our revolving credit facilities. We ended the quarter with approximately $2.7 billion of unrestricted cash and have no.
Near term debt maturities I'd note that our liquidity needs to run the business at 100% demand is approximately $750 million.
The combination of these efforts have enabled us to significantly reduce our daily cash requirements. As you can see on slide nine assuming we received certain spend waivers which are in process. Our daily cash burn is approximately $9.3 million, while our properties remain temporarily closed compared to our cash usage of approximately.
17 million before the shutdown.
We're taking this opportunity while properties or close to evaluate cost centers to ensure prudent spending as properties come back online and identify areas, where we can permanently reduce expenses to have helped drive further profitability.
Well the actions we've taken our extremely difficult we believe there necessary for the long term health of the company. So that we can best position Caesars for a strong and sustainable future.
Before we open the call for questions. Please note that the purpose of today's call is to discuss our first quarter performance. While we look forward to answering any questions you have about Caesars for more information regarding the proposed merger with Eldorado. Please refer to our filings with the SEC, We'll now open the call for questions.
Ladies and gentlemen.
Okay.
Question, you've already depressed firewall.
So we got aggression.
Again.
Great.
Correct.
Your first question comes from.
Pat.
Jefferies. Your line is open.
Hi.
Afternoon, apologies for jumping back and forth quite a bit this afternoon with a few calls and issues going on.
But I wanted to get a sense or.
You know what breakdown.
Then talk about between sort of driving customers versus flying customers.
What insights you may be able to share about.
The strip to that end.
Well I mean, I don't think that I think we're all pretty much an agreement that we think that the regional markets are going to bounce back quicker because of the lack of to need to fly in.
It's still remains to be seen from Las Vegas perspective, but we are seeing some encouraging statistics and information as we look towards around the fourth quarter.
When the governor here in Las Vegas announced the move towards Phase one and the Raiders scheduled came out we were we actually had a pretty significant Bob and reservations booked for the fourth quarter of this year September through the fourth quarter of this year.
Our group bookings in the fourth quarter actually still ahead of last year's pace keep in mind, we do have the forum this year.
Our Rob.
Regular bookings are off a little bit, but nothing were for the fourth quarter down little less than 10%. So there are some encouraging signs the other thing our player development folks at our hosts make outbound calls to our VIP isn't our customers and we're receiving a lot of encouraging feedback that customers are eager and excited.
Good to come back.
Okay. If I can just follow that up and maybe something a bit more pointed to it.
Theres any and pull on it in a roughly.
Statistically.
I think Las Vegas has about half and half driving versus flying in terms of visitation.
My inclination is that you'd be.
You would be.
Less than the average in terms of flying.
But do you happen to track than any of those statistics.
Yes, sure we do I don't have that were approximately 40% coming from southern California of our hotel business.
Got it okay. Thank you very much.
Thank you.
Yes.
Your next question comes from the line of.
Hi, less sense.
Your line.
Hey, guys.
Thanks for taking my question.
Hey, guys, if you're referring to slide nine in the deck as Eric you mentioned earlier it looks like you guys basically just from an operational perspective taken now almost $7 million out on a daily basis.
You think about the business coming back online.
The two part question.
What does it require in terms of revenues potentially split between recalls that vegas to get to EBIT dollar.
Or flat EBITDAR and secondly.
With respect.
Thank you William February period could you guys, maybe talk a little bit about what from a cost side perhaps.
Right.
Some of the growth obviously acknowledging there were some of that's obviously rexs were strong but anything you guys implemented.
In that period.
Speaks to.
It's burn rate, how it's going to look going forward.
Okay. Thanks, Scott actually let me take the second question first.
Because you're right we were off to an incredible start in January February and I think it was the result of the number of initiatives first and foremost we had taken over $120 million or the cost out of the business.
On a annual run rate basis, and so the flow through on incremental revenues or is a much better flow through that's number one number two our international marketing team at Caesars Palace had done a lot of work in the fourth quarter.
Couple trips to.
To Asia that had teed up for a great.
IP business in January and February of this year.
Lastly, sports betting in our southern and model across all of our regional markets drove a lot more foot traffic, which allowed us to grow revenues across all the verticals and then lastly.
The capital that we deployed to move to land in southern Indiana, and the opening of table games in both of the Indianapolis properties. Both of those results exceeded our expectations through the first two months. So combination of all those things allowed us to get off to a great spartannash through the first two months, we're almost 30%.
EBITDA year over year January February 20 versus 19.
Your second question in terms of the we've taken out as you noted roughly $8 million on it.
Monthly cash burn basis, we certainly are putting that all back in at once we're going to be bringing that back in a phased approach and but both by property and by market and we're going to let the consumer and the customer dictate.
The volumes that are coming back and that will determine how much of that the cost that we bring back consistent with that.
Yes, the things that I would add Carlo.
We believe that at the regional markets, we can be.
Breakeven from a covering our variable costs between 15 and 20% of the volume.
Previously and then to cover the fixed costs of those properties. It's approximately 30%. It varies based on whether table games are slots only in the various tax rates as you can understand but that will give you some idea, which where we can break even and start generating cash at a relatively low level of volume, it's obviously a bit higher in Las Vegas.
Yes, because of the more fixed nature of the business in the size of these operations and Thats more around the 50% area, where we need to have 50% of our prior period revenues.
Be able to.
Breakeven from a fixed and variable cost perspective, we can breakeven from variable cost perspective in Vegas.
At around 30% hotel occupancy or so so again the.
The breakeven points are relatively low in the business and we're optimistic that when we are allowed to reopen these facilities that will be able to quickly cover those and get everything open as fast as possible.
The last thing I would.
The last thing I would note is and I know, it's a lifetime ago February even though it's only a few months given how strong we were performing going into the closures I'd like to think that that positions us well to perform as well.
As you know any of our competitors coming out of the closures.
Understood great.
I just wanted to make sure.
Yes.
30% was the total.
Volume.
EBITDA flat right relative to prior regionals seek number was 50% in Las Vegas correct.
Yes, Thats correct to breakeven on an EBITDA property level basic covering all the property fixed cost and variable cost, we'd need 30% regional and 50% Vegas.
Okay, great. Thank you both both very much.
Thank you.
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Your next question comes from the line of Shaun Kelley from Bank of America. Your line is open.
Hi, good afternoon, everyone.
Was wondering if you could talk a little bit about just mix in Las Vegas I think there was also a coincident or lease that came out today talking about on.
The.
The reopening a potential phase reopening a couple of your core markets and was curious.
Could you talk little about how much casino block business, usually takes up of your overall profile and how much you could potentially move that up to as you start to.
Really work with your different I think your different distribution engine. Because then it gets a little bit unique to the to the Cesar stories. So some maybe some historical perspective, what you've done or where do you think you take the casino block at a maximum basis at a property or two would be would be helpful. The now.
I mean, typically our casino blocked represents about 40% and I think what are the things that I feel good about is that the casino marketing team has done a very good job of staying in touch with our VIP customers throughout the closure period I think marketing in general has done a lot of things that have kept them active theres a lot.
I have fun things that we've done on our.
Caesars Dotcom site that is that it's kept them engaged and the initiatives that we've taken to make sure and ensure their sees a reward benefits are still there. So I'd like to think that if the group and the travel business is going to be down of coming right out of the closure I think that we could traveling perform a little bit better maybe go a little bit deeper and get.
Higher percentage than normal coming out of our out of our casino block as we come out of the closure.
Thank you that and then Tony you have a lot of experience in Atlantic City in particular.
That market is even as one it's a little bit you need to Caesars could you just give us a little bit your perspective, how you think that market is going to perform on the back end to this and to that end.
Any comments on I think there were some promote proposals around.
Actual phased in tax relief and that market how material are important could that be the caesars.
Well it will be very important and I know, we've as we as an industry have put forth a lot of initiatives I haven't seen or heard anything in terms of the regulators or the government responding to those as of yet.
I think that Atlantic city is going to be similar to a lot of these regional markets I think that theres going to be pent up demand, particularly in drive in markets and I think that youre going to see.
That rebound on a percentage basis better than Las Vegas, and we actually had begun to move the needle again.
The first couple of months of this year and started to see some positive traction in Atlantic City I think the Big question Mark for Atlantic City is always the whole for promotional environment and how aggressive some of our competitors who.
Our in difficult situations.
That's I think the biggest question Mark that I think about as we look to Atlantic City reopening, but I do think that Atlantic city like other regional markets will will bounce back pretty quick.
Thank you very much.
Again, ladies and gentlemen, if you want to ask question. Please press star one pad itself.
Next question comes from the line of Thomas Allen from Morgan Stanley. Your line is open.
Can you hear me Jamie now, yes, sure just talk a little.
Sorry.
Can you just talk a little bit about how your online gambling business has been performing during the recent weeks and months.
Yes.
And I apologize I don't know the exact percentage in are gonna have you do but in new Jersey, it's been up pretty significantly almost I want to that we're going to say almost 100%.
But obviously, it's a very small number relatively speaking, but it is up dramatically and we recently launched in Pennsylvania as well yeah. We have a lot of activity John in that space with the.
Introduction potentially of live dealer very shortly which we didnt have.
In New Jersey, we launched as Tony mentioned in Pennsylvania.
And we'd anticipate rolling out and in other states as soon as possible, particularly once sports come back online.
Getting mobile going in other locations as well.
Okay, and then just a follow up sorry go ahead.
Now I was just gonna say you might see jurisdictions moving towards.
The rising online gaming I think as they're looking to close budget gaps and seeing how successful it's now becoming in summer locations, where it's been authorized.
Okay, and then and then just a follow up on this question.
Any read into the demographics of these customers have a customer they used to be your brick and mortar customers and they've done online are they new customers. The navy into how sticky there will be.
Well I can tell you before the closures it was pretty much a totally different customer it wasn't our bricks and mortar customer now it's I don't have the information on the last month or two since we've closed and maybe a lot of the bricks and mortar customers have converted over to online for this period, where they can't come into the physical facility, but generally speaking may or.
That was a totally different younger demographic skewed more mail and it was a different customer than a bricks and mortar customer leading up to the closures.
There was no no no cannibalization as matter of fact, we saw incremental play when you look at the two different populations to people that were already bricks and mortar that played a little bit online and people that weren't bricks and mortar that.
Became online customers and then periodically would visit the facilities.
Hello, and then just in terms of.
Reopenings and thanks for letting out which markets youre going to phase then.
I mean, there's a wide range of expectations of when Vegas properties are going to reopen from Mike.
Memorial Day.
And then some expectations that.
Private companies that phase in openings may not open certain properties till 2022 any any sense.
Your opinions on how that's going to shake out.
Yeah, well first of all I support the governor and the approach that he's taken and I think that he has done a fantastic job in he's obviously in a very difficult spot, but I agree in support of the way. He's approaching this the fact that he decided to open the phase one businesses, which is before casinos its local restaurants and its beauty salons and.
Retail.
We I personally didnt expect that to happen till later in the month and so for that to have happened. This past Saturday and there was a ton of pent up demand and local restaurants.
And what that will mean or translate to the strip, but that happened sooner than we thought it all goes well knock wood.
Phase one could be about a two week approved two week phase if theres not a spike.
We could be looking at casino opening strip openings.
Later this month Theres no guarantees not committed to that but again I agree with the way he is approaching it.
When when we do see the openings in Vegas.
We're going to look at Anna Phase approach as we mentioned certainly Caesars palace will be one of the property that we would open first we probably open a value oriented property on that on the east side of the strip and it may be three four properties, depending upon consumer demand. So that part remains to be seen and then we will be able to quickly ramp up.
As.
Demand.
Dictates and I'd, just add to that that in the regional markets. It does appear that they're moving a bit faster in terms of reopening.
We have.
Currently as its contemplated we'll have our auction facility in Arizona opening on the 15th the two Cherokee properties in North Carolina will open on the following Monday and then we also understand that Louisiana casinos.
We'll be able to open as well this weekend so thats.
Good news and we'll get some early read in terms of the demand from the customers.
In terms of.
How how the demand comes into those casinos when they re up.
Very helpful. Thank you.
Thank you.
Your next question comes from the line up with Harry Greg.
Is your line is open.
Hi, guys at 20 quick question on.
Your comment about Louisiana, just as an example of the reopening of other casinos.
Is it it to what degree do you think it's an opportunity to prioritize your highest value customers because if you take a look at the pent up demand in.
In.
At.
Hospitality or entertainment network that has come online. So far there is there seems to be a very strong surge in demand, which is a great problem to have so if you have this demand how can you.
Maximize your win per physician or do you plan to or is it is going to be just kind of first come first served.
Now, we'll look we certainly from a hotel perspective, I think this company has done a fantastic job of yielding to the highest worth customer whether it's a cash paying customer whether its deserving casino customer. So in terms of who stays in the hotel that parts easy.
And given that we're going to be yielding the hotel towards the highest worth customers. We maybe in some jurisdictions required to limit the number of people coming into the property. The people that will have the first priority will be those that are in the hotel and just by virtue of the yielding theyre going to be the Hyatt highest worth customers in terms of the additional fee.
Will there will be allowed to lead in.
That probably will be on a first come first our basis I don't see how we'd be able to yield.
Say were allowed to have 50% capacity and.
Not an out the hotel customers are taking up some percentage I don't know, how we'd be able to yield that that additional capacity, but certainly the hotel.
One thing we are doing.
Harry just to is that we're making our marketing efforts a whole lot more variable and then we'll be able to flex those according to the demand so.
We do see the unfortunate situation that you describe where we have lots of demand. We can quickly back off on the marketing to certain subsets of our database.
And make sure that simply by providing the incentives to those customers that are much more highly valuable in terms of profitability than than they would have a higher incentive to come to the property than others. We've also talked about doing it based on time. So in other words, you could have a multiplier that valid during.
In time periods of the day, because as you know from following the industry for a long time, even if we only have 50% of our slot machines open there are only certain periods of the week. When you really need all 50 per se when you need all of your slot machines open. So a mid week period mid day that would be a good time to try to and sent a lot of customers to come in.
Because we will likely not be at capacity during those periods of time.
So do you care to answer this question of whether or not given the limited supply of gaming physicians you plan on on tightening machines a bit.
I think thats more of a competitive question that I'd, rather not discuss on the call.
I thought I'd just take a shot.
And then just just a quick question for for Eric.
Can you just walk through the.
The burn per day, the cash burn for date figure.
Again, because I think it was you said it was pretty much fully loaded.
Assuming kind of normalized conditions and can you take a crack at and what it's come down to.
For example, the last if you want to take the last week for example.
Yes, you know if you refer to slide nine you can see where our breakdown as we tried to call out the major items like the rent to Vg.
2.2 million.
And the debt service at 1.7, those are very easy to calculate based on prior disclosure our capital expense reductions as I noted.
We.
Carry over a significant amount of capital into this year due to have mainly the conference Center and then both to land project. So our Q1 capital was fairly high we've since put nearly all of our capital projects on hold we're continuing those for safety and critical nature as well as those that were almost done we're finishing them out but the daily cash spend on.
That is much lower non agency, it's about $1 million and then.
But from the operational perspective, that's mainly salaries and wages. So we furloughed, 93% of our employees.
We have.
Hopefully plans to bring the vast majority of those back but as Tony mentioned earlier, we're not going to bring back employees.
At.
All at once and we'll try to bring them back at a pace that slower than the ramp up in the revenues. So that we get the floods, there and get to breakeven as quickly as possible. So those are really kind of four key categories and the one that we have the most control over that has the most significant use that labor component and we're going to be acutely focused to make sure we bring.
Get back at the right pace for the business to get back to cash flow neutral as quickly as possible.
Thanks, very much everyone.
Thank you.
I would like to turn the call of like I presented as discontinued.
Okay.
Oh, Thank you very much I say doesnt look like we have any other crashed questions. We appreciate everybodys time and.
And stay well and stay healthy.
Thank you again for joining us stake.
Brent economics connect.
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