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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2016	Oct. 28, 2016
Document and Entity Information
Entity Registrant Name	PENN NATIONAL GAMING INC
Entity Central Index Key	0000921738
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		83,522,580
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 201,768	$ 237,009
Receivables, net of allowance for doubtful accounts of $3,131 and $2,428 at September 30, 2016 and December 31, 2015, respectively	43,209	45,186
Prepaid expenses	59,538	76,784
Other current assets	48,515	13,497
Total current assets	353,030	372,476
Property and equipment, net	2,844,992	2,980,068
Other assets
Investment in and advances to unconsolidated affiliates	158,304	168,149
Goodwill	993,633	911,942
Other intangible assets, net	431,989	391,442
Advances to the Jamul Tribe	360,938	197,722
Other assets	108,793	116,953
Total other assets	2,053,657	1,786,208
Total assets	5,251,679	5,138,752
Current liabilities
Current portion of financing obligation to GLPI	55,256	50,548
Current maturities of long-term debt	81,741	92,108
Accounts payable	60,823	72,816
Accrued expenses	94,511	93,666
Accrued interest	8,702	7,091
Accrued salaries and wages	80,697	98,671
Gaming, pari-mutuel, property, and other taxes	62,683	57,486
Insurance financing	675	3,125
Other current liabilities	107,809	82,263
Total current liabilities	552,897	557,774
Long-term liabilities
Long-term financing obligation to GLPI, net of current portion	3,471,453	3,514,080
Long-term debt, net of current maturities and debt issuance costs	1,589,216	1,618,851
Deferred income taxes	120,161	107,921
Noncurrent tax liabilities	28,212
Other noncurrent liabilities	43,602	18,169
Total long-term liabilities	5,252,644	5,259,021
Shareholders' equity (deficit)
Common stock ($.01 par value, 200,000,000 shares authorized, 85,609,228 and 83,056,668 shares issued, and 83,441,835 and 80,889,275 shares outstanding at September 30, 2016 and December 31, 2015, respectively)	855	830
Treasury stock, at cost (2,167,393 shares held at September 30, 2016 and December 31, 2015)	(28,414)	(28,414)
Additional paid-in capital	1,007,504	988,686
Retained deficit	(1,530,313)	(1,634,591)
Accumulated other comprehensive loss	(3,494)	(4,554)
Total shareholders' deficit	(553,862)	(678,043)
Total liabilities and shareholders' deficit	5,251,679	5,138,752
Series B Preferred Stock
Shareholders' equity (deficit)
Preferred stock
Series C Preferred Stock
Shareholders' equity (deficit)
Preferred stock

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Receivables, allowance for doubtful accounts (in dollars)	$ 3,131	$ 2,428
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	85,609,228	83,056,668
Common stock, shares outstanding	83,441,835	80,889,275
Treasury stock, shares held	2,167,393	2,167,393
Series B Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series C Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	18,500	18,500
Preferred stock, shares issued	6,931	8,624
Preferred stock, shares outstanding	6,931	8,624

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues
Gaming	$ 654,591	$ 651,284	$ 1,974,618	$ 1,861,539
Food, beverage, hotel and other	147,554	124,721	429,792	350,905
Management service and licensing fees	3,130	2,871	8,567	7,614
Reimbursable management costs	5,965		8,820
Revenues	811,240	778,876	2,421,797	2,220,058
Less promotional allowances	(45,643)	(39,579)	(130,327)	(115,667)
Net revenues	765,597	739,297	2,291,470	2,104,391
Operating expenses
Gaming	336,669	334,219	1,011,187	942,730
Food, beverage, hotel and other	102,110	89,151	302,062	249,883
General and administrative	114,376	107,614	340,854	342,771
Reimbursable management costs	5,965		8,820
Depreciation and amortization	67,903	66,141	200,105	191,785
Insurance recoveries	(726)		(726)
Total operating expenses	626,297	597,125	1,862,302	1,727,169
Income from operations	139,300	142,172	429,168	377,222
Other income (expenses)
Interest expense	(114,349)	(111,406)	(345,548)	(329,550)
Interest income	8,202	3,083	20,039	7,396
Income from unconsolidated affiliates	3,505	3,759	11,662	11,895
Other	404	2,672	(1,978)	4,805
Total other expenses	(102,238)	(101,892)	(315,825)	(305,454)
Income from operations before income taxes	37,062	40,280	113,343	71,768
Income tax (benefit) provision	(9,473)	35,380	9,065	62,016
Net income	$ 46,535	$ 4,900	$ 104,278	$ 9,752
Earnings per common share:
Basic earnings per common share (in dollars per share)	$ 0.52	$ 0.06	$ 1.16	$ 0.11
Diluted earnings per common share (in dollars per share)	$ 0.51	$ 0.05	$ 1.14	$ 0.11

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Condensed Consolidated Statements of Comprehensive Income
Net income	$ 46,535	$ 4,900	$ 104,278	$ 9,752
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment during the period	(212)	(1,487)	1,060	(2,664)
Other comprehensive (loss) income	(212)	(1,487)	1,060	(2,664)
Comprehensive income	$ 46,323	$ 3,413	$ 105,338	$ 7,088

Condensed Consolidated Statements of Changes in Shareholders' Deficit - USD ($) $ in Thousands	Preferred Stock	Common Stock	Treasury Stock	Additional Paid-in Capital	Retained (Deficit) Earnings	Accumulated Other Comprehensive (Loss) Income	Total
Balance at Dec. 31, 2014		$ 813	$ (28,414)	$ 956,146	$ (1,635,277)	$ (1,282)	$ (708,014)
Balance (in shares) at Dec. 31, 2014	8,624	79,161,817
Increase (Decrease) in Shareholders' Equity
Share-based compensation arrangements, net of tax benefits of $10,143 and $8,510 for the nine months ended September 30, 2015 and 2016 respectively		$ 13		24,711			24,724
Share-based compensation arrangements (in shares)		1,353,264
Foreign currency translation adjustment						(2,664)	(2,664)
Net income					9,752		9,752
Balance at Sep. 30, 2015		$ 826	(28,414)	980,857	(1,625,525)	(3,946)	(676,202)
Balance (in shares) at Sep. 30, 2015	8,624	80,515,081
Balance at Dec. 31, 2015		$ 830	(28,414)	988,686	(1,634,591)	(4,554)	(678,043)
Balance (in shares) at Dec. 31, 2015	8,624	80,889,275
Increase (Decrease) in Shareholders' Equity
Share-based compensation arrangements, net of tax benefits of $10,143 and $8,510 for the nine months ended September 30, 2015 and 2016 respectively		$ 8		18,835			18,843
Share-based compensation arrangements (in shares)		859,560
Foreign currency translation adjustment						1,060	$ 1,060
Conversion of preferred stock		$ 17		(17)
Conversion of preferred stock (in shares)	(1,693)	1,693,000					1,693,000
Net income					104,278		$ 104,278
Balance at Sep. 30, 2016		$ 855	$ (28,414)	$ 1,007,504	$ (1,530,313)	$ (3,494)	$ (553,862)
Balance (in shares) at Sep. 30, 2016	6,931	83,441,835

Condensed Consolidated Statements of Changes in Shareholders' Deficit (Parenthetical) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Condensed Consolidated Statements of Changes in Shareholders' Deficit
Share-based compensation arrangements, tax benefit	$ 8,510	$ 10,143

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating activities
Net income	$ 104,278	$ 9,752
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	200,105	191,785
Amortization of items charged to interest expense	5,523	4,730
Change in fair value of contingent purchase price	(1,111)	(5,944)
(Gain) loss on sale of property and equipment and assets held for sale	(3,440)	801
Income from unconsolidated affiliates	(11,662)	(11,895)
Distributions from unconsolidated affiliates	21,500	22,050
Deferred income taxes	2,059	50,460
Charge for stock-based compensation	4,554	6,446
Decrease (increase), net of businesses acquired
Accounts receivable	5,305	5,015
Prepaid expenses and other current assets	(4,231)	6,288
Other assets	(1,157)	8,869
(Decrease) increase, net of businesses acquired
Accounts payable	(8,492)	4,763
Accrued expenses	(2,489)	1,248
Accrued interest	1,611	3,680
Accrued salaries and wages	(18,262)	(862)
Gaming, pari-mutuel, property and other taxes	5,499	15,041
Income taxes	22,711	1,666
Other current and noncurrent liabilities	(10,780)	(7,748)
Net cash provided by operating activities	311,521	306,145
Investing activities
Capital project expenditures, net of reimbursements	(14,482)	(125,169)
Capital maintenance expenditures	(51,431)	(41,866)
Advances to the Jamul Tribe	(167,863)	(64,228)
Proceeds from sale of property and equipment and assets held for sale	13,212	389
Investment in joint ventures		(2,799)
Acquisition of businesses, gaming, and other licenses, net of cash acquired	(56,748)	(450,170)
Net cash used in investing activities	(277,312)	(683,843)
Financing activities
Proceeds from exercise of options	5,654	8,069
Principal payments on financing obligation with GLPI	(37,920)	(35,452)
Proceeds from issuance of long-term debt, net of issuance costs	74,170	517,290
Principal payments on long-term debt	(102,234)	(92,885)
Payments of other long-term obligations	(13,387)	(3,307)
Payments of contingent purchase price	(1,793)
Proceeds from insurance financing	9,614	885
Payments on insurance financing	(12,064)	(12,212)
Tax benefit from stock options exercised	8,510	10,126
Net cash (used in) provided by financing activities	(69,450)	392,514
Net (decrease) increase in cash and cash equivalents	(35,241)	14,816
Cash and cash equivalents at beginning of year	237,009	208,673
Cash and cash equivalents at end of period	201,768	223,489
Supplemental disclosure
Interest expense paid, net of amounts capitalized	339,211	321,276
Income tax (refunds received)/taxes paid	$ (11,720)	$ 879

Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions		1 Months Ended
	Aug. 01, 2016	Jan. 31, 2015
Rocket Games
Non-cash transactions
Increase in acquired assets	$ 56.0
Increase in other current and non-current liabilities	$ 56.0
Repayment obligation for hotel and event center near Hollywood Casino Lawrenceburg
Non-cash transactions
Increase in total debt		$ 15.3
Increase in property and equipment, net		$ 15.3

Organization and Basis of Presentation	9 Months Ended
Organization and Basis of Presentation	Sep. 30, 2016
Organization and Basis of Presentation
Organization and Basis of Presentation	1. Organization and Basis of Presentation Penn National Gaming, Inc. (“Penn”) and together with its subsidiaries (collectively, the “Company”) is a diversified, multi-jurisdictional owner and manager of gaming and racing facilities and video gaming terminal operations with a focus on slot machine entertainment. We have also recently expanded into social onling gaming offerings via our Penn Interative Ventures, LLC (“Penn Interactive Ventures”) division and our recent acquisition of Rocket Games, Inc. (“Rocket Games”). As of September 30, 2016, the Company owned, managed, or had ownership interests in twenty-six facilities in the following sixteen jurisdictions: Florida, Illinois, Indiana, Kansas, Maine, Massachusetts, Mississippi, Missouri, Nevada, New Jersey, New Mexico, Ohio, Pennsylvania, Texas, West Virginia and Ontario, Canada. The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The condensed consolidated financial statements include the accounts of Penn and its subsidiaries. Investment in and advances to unconsolidated affiliates, that do not meet the consolidation criteria of the authoritative guidance for voting interest, controlling interest or variable interest entities (“VIE”), are accounted for under the equity method. All significant intercompany accounts and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses for the reporting periods. Actual results could differ from those estimates. Operating results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. The notes to the consolidated financial statements contained in the Annual Report on Form 10-K for the year ended December 31, 2015 should be read in conjunction with these condensed consolidated financial statements. The December 31, 2015 financial information has been derived from the Company’s audited consolidated financial statements.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2016

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Revenue Recognition and Promotional Allowances

Gaming revenue consists mainly of slot and video lottery gaming machine revenue as well as to a lesser extent table game and poker revenue. Gaming revenue is the aggregate net difference between gaming wins and losses, with liabilities recognized for funds deposited by customers before gaming play occurs, for "ticket-in, ticket-out" coupons in the customers' possession, and for accruals related to the anticipated payout of progressive jackpots. Progressive slot machines, which contain base jackpots that increase at a progressive rate based on the number of coins played, are charged to revenue as the amount of the jackpots increases. Table game revenue is the aggregate of table drop adjusted for the change in aggregate table chip inventory. Table drop is the total dollar amount of the currency, coins, chips, tokens and outstanding markers (credit instruments) that are removed from the live gaming tables.

Food, beverage, hotel and other revenue, including racing revenue, is recognized as services are performed. Racing revenue includes the Company’s share of pari-mutuel wagering on live races after payment of amounts returned as winning wagers, its share of wagering from import and export simulcasting, and its share of wagering from its off-track wagering facilities. Advance deposits on lodging are recorded as accrued liabilities until services are provided to the customer.

Revenue from the management service contract for Casino Rama is based upon contracted terms and is recognized when services are performed.

Revenues include reimbursable costs associated with the Company’s management agreement with the Jamul Indian Village of California (the “Jamul Tribe”), which represent amounts received or due pursuant to the Company’s management agreement for the reimbursement of expenses, primarily payroll costs, incurred on their behalf. The Company recognizes the reimbursable costs associated with this contract as revenue on a gross basis, with an offsetting amount charged to operating expense as it is the primary obligor for these costs.

Revenues are recognized net of certain sales incentives in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-50, “Revenue Recognition—Customer Payments and Incentives.” The Company records certain sales incentives and points earned in point-loyalty programs as a reduction of revenue.

The retail value of accommodations, food and beverage, and other services furnished to guests without charge is included in gross revenues and then deducted as promotional allowances. The estimated cost of providing such promotional allowances is primarily included in food, beverage and other expense.

The amounts included in promotional allowances for the three and nine months ended September 30, 2016 and 2015 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	10,257	$	8,649	$	29,477	$	25,888
Food and beverage		32,977		28,245		94,295		82,896
Other		2,409		2,685		6,555		6,883
Total promotional allowances	$	45,643	$	39,579	$	130,327	$	115,667

The estimated cost of providing such complimentary services for the three and nine months ended September 30, 2016 and 2015 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	1,419	$	1,085	$	3,954	$	2,999
Food and beverage		12,488		11,280		36,212		32,761
Other		909		881		2,563		2,605
Total cost of complimentary services	$	14,816	$	13,246	$	42,729	$	38,365

Gaming and Racing Taxes

The Company is subject to gaming and pari-mutuel taxes based on gross gaming revenue and pari-mutuel revenue in the jurisdictions in which it operates. The Company primarily recognizes gaming and pari-mutuel tax expense based on the statutorily required percentage of revenue that is required to be paid to state and local jurisdictions in the states where or in which wagering occurs. In certain states in which the Company operates, gaming taxes are based on graduated rates. The Company records gaming tax expense at the Company’s estimated effective gaming tax rate for the year, considering estimated taxable gaming revenue and the applicable rates. Such estimates are adjusted each interim period. If gaming tax rates change during the year, such changes are applied prospectively in the determination of gaming tax expense in future interim periods. Finally, the Company recognizes purse expense based on the statutorily required percentage of revenue that is required to be paid out in the form of purses to the winning owners of horse races run at the Company’s racetracks in the period in which wagering occurs. For the three and nine months ended September 30, 2016, these expenses, which are recorded primarily within gaming expense in the condensed consolidated statements of income, were $257.0 million and $772.9 million, as compared to $259.4 million and $730.9 million for the three and nine months ended September 30, 2015.

Long-term asset related to the Jamul Tribe

On April 5, 2013, the Company announced that, subject to final National Indian Gaming Commission approval, it and the Jamul Tribe had entered into definitive agreements to jointly develop a Hollywood Casino-branded gaming facility on the Jamul Tribe’s trust land in San Diego County, California. The definitive agreements were entered into to: (i) secure the development, management, and branding services of the Company to assist the Jamul Tribe during the pre-development and entitlement phase of the project; (ii) set forth the terms and conditions under which the Company will provide a loan or loans to the Jamul Tribe to fund certain development costs; and (iii) create an exclusive arrangement between the parties.

The Jamul Tribe is a federally recognized Indian Tribe holding a government-to-government relationship with the U.S. through the U.S. Department of the Interior’s Bureau of Indian Affairs and possessing certain inherent powers of self-government. The Jamul Tribe is the beneficial owner of approximately six acres of reservation land located within the exterior boundaries of the State of California held by the U.S. in trust for the Jamul Tribe (the “Property”). The Jamul Tribe exercises jurisdiction over the Property pursuant to its powers of self-government and consistent with the resolutions and ordinances of the Jamul Tribe. The arrangement between the Jamul Tribe and the Company provides the Jamul Tribe with the expertise, knowledge and capacity of a proven developer and operator of gaming facilities and provides the Company with the exclusive right to administer and oversee planning, designing, development, construction management, and coordination during the development and construction of the project as well as the management of a gaming facility on the Property.

Hollywood Casino Jamul – San Diego is a three-story gaming and entertainment facility of approximately 200,000 square feet featuring 1,731 slot machines, 40 live table games, multiple restaurants, bars and lounges and a partially enclosed parking structure with over 1,800 spaces. In mid-January 2014, the Company commenced construction activities at the site. The facility opened to the public on October 10, 2016. The Company currently provides a portion of the financing to the Jamul Tribe in connection with the project and, following the opening, now manages and provides branding for the casino.

The Company is accounting for the development agreement and related loan commitment letter with the Jamul Tribe as a loan (the “Senior Loans”) with accrued interest in accordance with ASC 310, “Receivables.” The Senior Loans represent initial advances made by the Company to the Jamul Tribe for the development and construction of a gaming facility for the Jamul Tribe on reservation land. As such, the Jamul Tribe owns the casino and its related assets and liabilities. San Diego Gaming Ventures, LLC (“SDGV”), a wholly-owned subsidiary of the Company, is a separate legal entity and, following completion of the project and subsequent commencement of gaming operations on the Property, will be the Penn entity which receives management and licensing fees from the Jamul Tribe. The Company’s Senior Loans with the Jamul Tribe totaled $360.9 million and $197.7 million, which includes accrued interest of $33.2 million, and $13.9 million, at September 30, 2016 and December 31, 2015, respectively. Collectability of the Senior Loans will be derived from the revenues of the casino operations. The Company believes collectability of the Senior Loans is highly certain. However, in the event that projections related to the profitability of the property are inaccurate, the Company may be required to record a reserve related to the collectability of the Senior Loans. Subsequent to September 30, 2016, the Company was repaid a significant amount of the advances to the Jamul Tribe. See Note 12 for further details.

The Company considered whether the arrangement with the Jamul Tribe represents a variable interest that should be accounted for pursuant to the VIE subsections of ASC 810. The Company noted that the scope and scope exceptions of ASC 810-10-15-12(e) states that a reporting entity shall not consolidate a government organization or financing entity established by a government organization (other than certain financing entities established to circumvent the provisions of the VIE subsections of ASC 810). Based on the status of the Jamul Tribe as a government organization, the Company believes its arrangement with the Jamul Tribe is not within the scope defined by ASC 810.

Earnings Per Share

The Company calculates earnings per share (“EPS”) in accordance with ASC 260, “Earnings Per Share” (“ASC 260”). Basic EPS is computed by dividing net income applicable to common stock by the weighted-average number of common shares outstanding during the period. Diluted EPS reflects the additional dilution for all potentially-dilutive securities such as stock options and unvested restricted shares.

At September 30, 2016 and 2015, the Company had outstanding 6,931 and 8,624, respectively, shares of Series C Convertible Preferred Stock. During the three and nine months ended September 30, 2016, 516 and 1,693 shares, respectively, of Series C Preferred Stock were sold by the holders of these securities, which converted into 516,000 and 1,693,000 shares, respectively, of common stock under previously agreed upon terms. The Company determined that the preferred stock qualified as a participating security as defined in ASC 260 since these securities participate in dividends with the Company’s common stock. In accordance with ASC 260, a company is required to use the two-class method when computing EPS when a company has a security that qualifies as a “participating security.” The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. A participating security is included in the computation of basic EPS using the two-class method. Under the two-class method, basic EPS for the Company’s common stock is computed by dividing net income applicable to common stock by the weighted-average common shares outstanding during the period. Diluted EPS for the Company’s common stock is computed using the more dilutive of the two-class method or the if-converted method.

The following table sets forth the allocation of net income for the three and nine months ended September 30, 2016 and 2015 under the two-class method:


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)				(in thousands)

Net income	$	46,535	$	4,900	$	104,278	$	9,752
Net income applicable to preferred stock		3,658		476		9,268		951
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801

The following table reconciles the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS for the three and nine months ended September 30, 2016 and 2015:


	Three Months Ended September 30,	Three Months Ended September 30,	Nine Months Ended September 30,	Nine Months Ended September 30,
	2016	2015	2016	2015
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	83,065	80,243	81,917	79,803
Assumed conversion of dilutive employee stock-based awards	1,233	2,355	1,381	2,307
Assumed conversion of restricted stock	38	58	41	60
Diluted weighted-average common shares outstanding before participating security	84,336	82,656	83,339	82,170
Assumed conversion of preferred stock	7,086	8,624	7,991	8,624
Diluted weighted-average common shares outstanding	91,422	91,280	91,330	90,794

Options to purchase 2,990,243 shares and 1,621,219 shares were outstanding during the nine months ended September 30, 2016 and 2015, respectively, but were not included in the computation of diluted EPS because they were antidilutive.

The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the three and nine months ended September 30, 2016 and 2015 (in thousands, except per share data):


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
Calculation of basic EPS:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Weighted-average common shares outstanding		83,065		80,243		81,917		79,803
Basic EPS	$	0.52	$	0.06	$	1.16	$	0.11

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Diluted weighted-average common shares outstanding before participating security		84,336		82,656		83,339		82,170
Diluted EPS	$	0.51	$	0.05	$	1.14	$	0.11

Stock-Based Compensation

The Company accounts for stock compensation under ASC 718, “Compensation-Stock Compensation,” which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. This expense is recognized ratably over the requisite service period following the date of grant.

The fair value for stock options was estimated at the date of grant using the Black-Scholes option-pricing model, which requires management to make certain assumptions. The risk-free interest rate was based on the U.S. Treasury spot rate with a term equal to the expected life assumed at the date of grant. Expected volatility was estimated based on the historical volatility of the Company’s stock price over a period of 5.40 years, in order to match the expected life of the options at the grant date. Historically, at the grant date, there has been no expected dividend yield assumption since the Company has not paid any cash dividends on its common stock since its initial public offering in May 1994 and since the Company intends to retain all of its earnings to finance the development of its business for the foreseeable future. The weighted-average expected life was based on the contractual term of the stock option and expected employee exercise dates, which was based on the historical and expected exercise behavior of the Company’s employees. The Company granted 1,573,651 stock options during the nine months ended September 30, 2016.

Stock-based compensation expense for the three and nine months ended September 30, 2016 was $1.5 million and $4.6 million, as compared to $2.0 million and $6.4 million for the three and nine months ended September 30, 2015, and is included within the condensed consolidated statements of income under general and administrative expense.

The Company’s cash-settled phantom stock unit awards (“PSUs”), which vest over a period of three to four years, entitle employees and directors to receive cash based on the fair value of the Company’s common stock on the vesting date. The PSUs are accounted for as liability awards and are re-measured at fair value each reporting period until they become vested with compensation expense being recognized over the requisite service period in accordance with ASC 718-30, “Compensation—Stock Compensation, Awards Classified as Liabilities.” The Company had a liability, which is included in accrued salaries and wages within the condensed consolidated balance sheets, associated with its PSUs of $2.9 million and $7.8 million at September 30, 2016 and December 31, 2015, respectively. For PSUs held by Penn employees, there was $8.8 million of total unrecognized compensation cost at September 30, 2016 that will be recognized over the grants remaining weighted average vesting period of 1.45 years. For the three and nine months ended September 30, 2016, the Company recognized $2.1 million and $5.7 million of compensation expense associated with these awards, as compared to $1.9 million and $11.4 million for the three and nine months ended September 30, 2015. The changes are primarily due to volatility in stock price year-over-year for both Penn and Gaming and Leisure Properties, Inc., (“GLPI”) awards held by Penn employees. Amounts paid by the Company for the three and nine months ended September 30, 2016 on these cash-settled awards totaled $5.4 million and $9.9 million, as compared to $7.6 million and $12.9 million for the three and nine months ended September 30, 2015.

For the Company’s stock appreciation rights (“SARs”), the fair value of the SARs is calculated during each reporting period and estimated using the Black-Scholes option pricing model based on the various inputs discussed below. The Company’s SARs, which vest over a period of four years, are accounted for as liability awards since they will be settled in cash. The Company had a liability, which is included in accrued salaries and wages within the condensed consolidated balance sheets, associated with its SARs of $7.1 million and $8.0 million at September 30, 2016 and December 31, 2015, respectively. For SARs held by Penn employees, there was $4.3 million of total unrecognized compensation cost at September 30, 2016 that will be recognized over the awards remaining weighted average vesting period of 2.72 years. For the three and nine months ended September 30, 2016, the Company recognized compensation expense of $0.4 million and $1.8 million associated with these awards, as compared to a credit of $3.0 million and compensation expense of $4.1 million for the three and nine months ended September 30, 2015. The changes are primarily due to volatility in stock price year-over-year for both Penn and GLPI awards held by Penn employees. Amounts paid by the Company for the three and nine months ended September 30, 2016 on these cash-settled awards totaled $1.0 million and $2.5 million, as compared to $0.3 million and $2.6 million for the three and nine months ended September 30, 2015.

The following are the weighted-average assumptions used in the Black-Scholes option-pricing model for stock option awards granted during the nine months ended September 30, 2016 and 2015, respectively:


	2016		2015

Risk-free interest rate	1.20	%	1.53	%
Expected volatility	31.23	%	36.84	%
Dividend yield	—		—
Weighted-average expected life (years)	5.40		5.45

Segment Information

The Company’s Chief Executive Officer and President, who is the Company’s Chief Operating Decision Maker (“CODM”), as that term is defined in ASC 280, “Segment Reporting” (“ASC 280”), measures and assesses the Company’s business performance based on regional operations of various properties grouped together based primarily on their geographic locations. During the second quarter of 2016, the Company changed its three reportable segments from East/Midwest, West and Southern Plains to Northeast, South/West, and Midwest in connection with the addition of a new regional vice president and a realignment of responsibilities within our segments. This realignment changed the manner in which information is provided to the CODM and therefore how performance is assessed and resources are allocated to the business.

The Northeast reportable segment consists of the following properties: Hollywood Casino at Charles Town Races, Hollywood Casino Bangor, Hollywood Casino at Penn National Race Course, Hollywood Casino Toledo, Hollywood Casino Columbus, Hollywood Gaming at Dayton Raceway, Hollywood Gaming at Mahoning Valley Race Course, and Plainridge Park Casino, which opened on June 24, 2015. It also includes the Company’s Casino Rama management service contract.

The South/West reportable segment consists of the following properties: Zia Park Casino, Hollywood Casino Tunica, Hollywood Casino Gulf Coast, Boomtown Biloxi, M Resort, and Tropicana Las Vegas, which was acquired on August 25, 2015, as well as the Hollywood Casino Jamul-San Diego project with the Jamul Tribe, which opened on October 10, 2016.

The Midwest reportable segment consists of the following properties: Hollywood Casino Aurora, Hollywood Casino Joliet, Argosy Casino Alton, Argosy Casino Riverside, Hollywood Casino Lawrenceburg, Hollywood Casino St. Louis, and Prairie State Gaming, which the Company acquired on September 1, 2015, and includes the Company’s 50% investment in Kansas Entertainment, LLC (“Kansas Entertainment”), which owns the Hollywood Casino at Kansas Speedway.

The Other category consists of the Company’s standalone racing operations, namely Rosecroft Raceway, which was sold on July 31, 2016, Sanford-Orlando Kennel Club, and the Company’s joint venture interests in Sam Houston Race Park, Valley Race Park, and Freehold Raceway. If the Company is successful in obtaining gaming operations at these locations, they would be assigned to one of the Company’s regional executives and reported in their respective reportable segment. The Other category also includes the Company’s corporate overhead operations, which does not meet the definition of an operating segment under ASC 280. Additionally, Penn Interactive Ventures, the Company’s wholly-owned subsidiary which represents its social online gaming initiatives, including the recently acquired Rocket Games, would meet the definition of an operating segment under ASC 280, but is quantatively not significant to the Company’s operations as it represents 0.5% of net revenues and 0.4% of income from operations for the nine months ended September 30, 2016.

In addition to GAAP financial measures, management uses adjusted EBITDA as an important measure of the operating performance of its segments, including the evaluation of operating personnel and believes it is especially relevant in evaluating large, long lived casino projects because it provides a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects. The Company defines adjusted EBITDA as earnings before interest, taxes, stock compensation, debt extinguishment charges, impairment charges, insurance recoveries and deductible charges, depreciation and amortization, changes in the estimated fair value of contingent purchase price, gain or loss on disposal of assets, and other income or expenses. Adjusted EBITDA is also inclusive of income or loss from unconsolidated affiliates, with the Company’s share of non-operating items (such as depreciation and amortization) added back for its joint venture in Kansas Entertainment. Adjusted EBITDA excludes payments associated with our Master Lease agreement with GLPI as the transaction is accounted for as a financing obligation. Adjusted EBITDA should not be construed as an alternative to operating income, as an indicator of the Company’s operating performance, as an alternative to cash flows from operating activities, as a measure of liquidity, or as any other measure of performance determined in accordance with GAAP. The Company has significant uses of cash flows, including capital expenditures, interest payments, taxes and debt principal repayments, which are not reflected in adjusted EBITDA.

See Note 8 for further information with respect to the Company’s segments.

Other Comprehensive Income

The Company accounts for comprehensive income in accordance with ASC 220, “Comprehensive Income,” which establishes standards for the reporting and presentation of comprehensive income in the consolidated financial statements. The Company presents comprehensive income in two separate but consecutive statements. For the three and nine months ended September 30, 2016 and 2015, the only component of accumulated other comprehensive income was foreign currency translation adjustments.

New Accounting Pronouncements	9 Months Ended
New Accounting Pronouncements	Sep. 30, 2016
New Accounting Pronouncements
New Accounting Pronouncements	3. New Accounting Pronouncements In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). The amendments are intended to address diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following specific cash flow issues: (a) debt prepayment or debt extinguishment costs; (b) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (c) contingent consideration payments made after a business combination; (d) proceeds from the settlement of insurance claims; (e) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (f) distributions received from equity method investees; (g) beneficial interest in securitization transactions; and (h) separately identifiable cash flows and application of the predominance principle. For public companies, the amendments are effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. An entity that elects early adoption must adopt all of the amendments in the same period. The company is currently assessing the impact that the adoption of these amendments will have on its consolidated statement of cash flows and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which impacts virtually all aspects of an entity’s revenue recognition. The core principle of Topic 606 is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In July 2015, the FASB deferred the effective date of the standard by one year which results in the new standard being effective for the Company at the beginning of its first quarter of fiscal year 2018. In addition, during March, April and May 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net), ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing and ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, respectively, which clarified the guidance on certain items such as reporting revenue as a principal versus agent, identifying performance obligations, accounting for intellectual property licenses, assessing collectability and presentation of sales taxes. Management has not yet completed its assessment of the impact of the new standard on the Company’s consolidated financial statements. Although the Company is currently assessing the impact that the adoption of the new standard will have on its consolidated financial statements and related disclosures, we do believe it will result in changes to our accounting for loyalty points that are earned by our customers. The Company’s Marquee Rewards program allows customers, who are members and utilize their rewards membership card to earn promotional points that are redeemable for slot play and complimentaries. The accumulated points can be redeemed for food and beverages at our restaurants, and products offered at our retail stores across the vast majority of Penn’s casino properties. The estimated liability for unredeemed points is currently accrued based on expected redemption rates and the estimated costs of the services or merchandise to be provided. Under the new standard, we will need to defer the full retail value of the complimentaries until the future revenue transaction occurs. Although the exact amount of the increase to our point liabilities has not yet been determined, we do not anticipate it will have a significant impact on our earnings. In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718). The amendments are intended to improve the accounting for employee share-based payments and affect all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. For public companies, the amendments are effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. Early adoption is permitted for any organization in any interim or annual period. Management plans to implement this change in accounting principle in 2017 and does not anticipate a material impact from this new guidance. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which will require, among other items, lessees to recognize a right-of-use asset and a lease liability for most leases. Extensive quantitative and qualitative disclosures, including significant judgments made by management, will be required to provide greater insight into the extent of revenue and expense recognized and expected to be recognized from existing contracts. The accounting applied by a lessor is largely unchanged from that applied under the current standard. The standard must be adopted using a modified retrospective transition approach and provides for certain practical expedients. The ASU is effective for public entities for fiscal years beginning after December 15, 2018, with early adoption permitted. Management has not yet completed its assessment of the impact of the new standard on the Company’s consolidated financial statements. However, the Company has numerous operating leases which, under the new standard, will need to be reported as an asset and a liability on its balance sheet. The precise amount of this asset and liability will be determined based on the leases that exist at the Company on the date of adoption. In February 2015, the FASB issued ASU 2015-02 with new consolidation guidance which modifies the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The main provisions of the new guidance include modifying the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, the evaluation of fees paid to a decision maker or a service provider as a variable interest, and the effect of fee arrangements and related parties on the primary beneficiary determination, as well as provides a scope exception for certain investment funds. The new guidance is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. A reporting entity may apply the new guidance using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption. A reporting entity also may apply the new guidance retrospectively. The Company adopted this guidance in the first quarter of 2016 and it had no impact to the Company’s financial statements.

- Definition

The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Acquisitions	9 Months Ended
Acquisitions	Sep. 30, 2016
Acquisitions
Acquisitions	4. Acquisitions On August 1, 2016, the Company acquired 100% of the outstanding equity securities of social casino game developer, Rocket Games, for initial cash consideration of $59.1 million subject to customary working capital adjustments. The Stock Purchase Agreement includes contingent consideration payments over the next two years that will be based on a multiple of 6.25 times Rocket Games’ then-trailing twelve months of earnings before interest, taxes, depreciation and amortization, subject to a cap of $110 million. Up to $10 million of the contingent consideration is accounted for as compensation as it is tied to continued employment over a two year period. The acquisition was funded by Penn with cash on hand and revolving commitments under the Company’s senior secured credit facility. The preliminary fair value of the contingent purchase price was estimated to be $56.0 million at the acquisition date based on an income approach by applying an option pricing method to the Company’s internal earning projections using a Monte Carlo simulation. The preliminary purchase price allocation resulted in goodwill of $81.7 million, other intangible assets of $43.4 million, current assets of $7.7 million, other assets of $0.3 million, current contingent consideration liabilities of $28.2 million, other current liabilities of $5.9 million, non-current contingent consideration liabilities of $27.8 million and deferred tax liabilities of $12.1 million. Contingent consideration, goodwill, other intangible assts and the related deferred tax liabilities are provisional amounts as of September 30, 2016. This acquisition complements Penn’s interactive gaming strategy through its wholly-owned subsidiary Penn Interactive Ventures which is included in the Other category.

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

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+ Details

Property and Equipment

9 Months Ended

Sep. 30, 2016

Property and Equipment

Property and Equipment

5. Property and Equipment

Property and equipment, net, consists of the following:


	September 30,		December 31,
	2016		2015
	(in thousands)

Property and equipment - non-leased
Land and improvements	$	289,159	$	288,910
Building and improvements		402,532		396,497
Furniture, fixtures and equipment		1,351,761		1,303,153
Leasehold improvements		109,882		129,012
Construction in progress		14,491		9,175
		2,167,825		2,126,747
Less Accumulated depreciation		(1,200,804)		(1,093,115)
		967,021		1,033,632
Property and equipment - master lease
Land and improvements		382,246		382,246
Building and improvements		2,219,018		2,219,018
		2,601,264		2,601,264
Less accumulated depreciation		(723,293)		(654,828)
		1,877,971		1,946,436
Property and equipment, net	$	2,844,992	$	2,980,068

Property and equipment, net decreased by $135.1 million for the nine months ended September 30, 2016 primarily due to depreciation expense, which is partially offset by improvements at Tropicana Las Vegas, and normal capital maintenance expenditures for the nine months ended September 30, 2016.

Depreciation expense, for property and equipment including assets under capital leases, totaled $65.5 million and $196.8 million for the three and nine months ended September 30, 2016, respectively, of which $22.7 million and $68.4 million related to assets under the Master Lease, respectively. No interest was capitalized in connection with major construction projects for the three and nine months ended September 30, 2016 compared to $0 and $1.8 million for the three and nine months ended September 30, 2015.

Long-term Debt

9 Months Ended

Sep. 30, 2016

Long-term Debt

Long-term Debt

6. Long-term Debt

Long-term debt, net of current maturities, is as follows:


	September 30,		December 31,
	2016		2015
	(in thousands)

Senior secured credit facility	$	1,232,818	$	1,259,740
$300 million 5.875 % senior unsecured notes due November 1, 2021		300,000		300,000
Other long-term obligations		154,469		146,992
Capital leases		2,215		28,466
		1,689,502		1,735,198
Less current maturities of long-term debt		(81,741)		(92,108)
Less net discounts		(636)		(686)
Less debt issuance costs, net of accumulated amortization of $18.7 million and $13.3 million, respectively		(17,909)		(23,553)
	$	1,589,216	$	1,618,851

The following is a schedule of future minimum repayments of long-term debt as of September 30, 2016 (in thousands):


Within one year	$	81,631
1-3 years		966,934
3-5 years		285,048
Over 5 years		355,889
Total minimum payments	$	1,689,502

Senior Secured Credit Facility

On April 28, 2015, the Company entered into an agreement to amend its senior secured credit facility. In August 2015, the amendment to the senior secured credit facility went into effect increasing the capacity under an existing five year revolver from $500 million to $633.2 million and increased the existing five year $500 million Term Loan A facility by $146.7 million. The seven year $250 million Term Loan B facility remained unchanged. At September 30, 2016, the Company’s senior secured credit facility had a gross outstanding balance of $1,232.8 million, consisting of a $555.7 million Term Loan A facility, a $243.1 million Term Loan B facility, and $434.0 million outstanding on the revolving credit facility. Additionally, at September 30, 2016, the Company had conditional obligations under letters of credit issued pursuant to the senior secured credit facility with face amounts aggregating $23.0 million, resulting in $176.2 million of available borrowing capacity as of September 30, 2016 under the revolving credit facility.

Corporate Airplane Loan

On September 30, 2016, the Company acquired a previously leased corporate airplane and financed the purchase price with an amortizing loan at a fixed interest rate of 5.22% for a term of five years with monthly payments of $220 thousand and a balloon payment of $12.6 million at the end of the loan term. This loan is included with other long-term obligations.

Covenants

The Company’s senior secured credit facility and $300 million 5.875% senior unsecured notes require it, among other obligations, to maintain specified financial ratios and to satisfy certain financial tests, including fixed charge coverage, interest coverage, senior leverage and total leverage ratios. In addition, the Company’s senior secured credit facility and $300 million 5.875% senior unsecured notes restrict, among other things, its ability to incur additional indebtedness, incur guarantee obligations, amend debt instruments, pay dividends, create liens on assets, make investments, engage in mergers or consolidations, and otherwise restrict corporate activities.

At September 30, 2016, the Company was in compliance with all required financial covenants.

Master Lease Financing Obligation	9 Months Ended
Master Lease Financing Obligation	Sep. 30, 2016
Master Lease Financing Obligation
Master Lease Financing Obligation	7. Master Lease Financing Obligation The Company’s Master Lease with GLPI is accounted for as a financing obligation. The obligation was calculated at the inception of the transaction based on the future minimum lease payments due to GLPI under the Master Lease discounted at 9.70%, which represents the estimated incremental borrowing rate over the lease term, including renewal options that were reasonably assured of being exercised and the funded construction of certain leased real estate assets in development at the date of the Spin-Off. Total payments under the Master Lease were $109.7 million and $331.9 million and $109.0 million and $327.3 million for the three and nine months ended September 30, 2016 and 2015, respectively. The interest expense recognized for the three and nine months ended September 30, 2016 was $97.4 million and $293.9 million as compared to $97.8 million and $291.9 million for the three and nine months ended September 30, 2015, respectively.

Segment Information

9 Months Ended

Sep. 30, 2016

Segment Information

Segment Information

8. Segment Information

During the second quarter of 2016, the Company changed its three reportable segments from East/Midwest, West and Southern Plains to Northeast, South/West, and Midwest in connection with the addition of a new regional vice president and a realignment of responsibilities within the Company’s segments. Segment information for prior periods has been restated for comparability. The following tables (in thousands) present certain information with respect to the Company’s segments. Intersegment revenues between the Company’s segments were not material in any of the periods presented below. The income (loss) from operations by segment presented below does not include allocations for corporate overhead costs or expenses associated with utilizing property subject to the Master Lease.


Three months ended September 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	101,752	$	19,337	$	56,343	$	(38,132)	$	139,300
Charge for stock compensation		—		—		—		1,517		1,517
Depreciation and amortization		22,975		9,097		9,593		26,238		67,903
Contingent purchase price		(293)		—		—		263		(30)
(Gain) loss on disposal of assets		(13)		72		64		(2,904)		(2,781)
Insurance recoveries		—		—		(726)		—		(726)
Income (loss) from unconsolidated affiliates		—		—		3,798		(293)		3,505
Non-operating items for Kansas JV		—		—		2,572		—		2,572
Adjusted EBITDA	$	124,421	$	28,506	$	71,644	$	(13,311)	$	211,260

Three months ended September 30, 2015	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	107,148	$	22,307	$	52,521	$	(39,804)	$	142,172
Charge for stock compensation		—		—		—		2,025		2,025
Depreciation and amortization		24,350		6,971		9,984		24,836		66,141
Contingent purchase price		(6,651)		—		—		—		(6,651)
Loss on disposal of assets		33		185		34		24		276
Income (loss) from unconsolidated affiliates		—		—		3,831		(72)		3,759
Non-operating items for Kansas JV		—		—		2,540		—		2,540
Adjusted EBITDA	$	124,880	$	29,463	$	68,910	$	(12,991)	$	210,262


Nine months ended September 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	306,368	$	72,944	$	172,013	$	(122,157)	$	429,168
Charge for stock compensation		—		—		—		4,554		4,554
Depreciation and amortization		69,177		26,701		28,621		75,606		200,105
Contingent purchase price		(1,374)		—		—		263		(1,111)
(Gain) loss on disposal of assets		(6)		58		18		(3,510)		(3,440)
Insurance recoveries		—		—		(726)		—		(726)
Income (loss) from unconsolidated affiliates		—		—		12,261		(599)		11,662
Non-operating items for Kansas JV		—		—		7,713		—		7,713
Adjusted EBITDA	$	374,165	$	99,703	$	219,900	$	(45,843)	$	647,925

Nine months ended September 30, 2015	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	274,995	$	81,910	$	160,631	$	(140,314)	$	377,222
Charge for stock compensation		—		—		—		6,446		6,446
Depreciation and amortization		70,016		17,091		29,846		74,832		191,785
Contingent purchase price		(5,944)		—		—		—		(5,944)
Loss on disposal of assets		40		585		28		148		801
Income (loss) from unconsolidated affiliates		—		—		12,021		(126)		11,895
Non-operating items for Kansas JV		—		—		7,818		—		7,818
Adjusted EBITDA	$	339,107	$	99,586	$	210,344	$	(59,014)	$	590,023


		Northeast		South/West		Midwest		Other (1)		Total
	(in thousands)
Three months ended September 30, 2016
Net revenues	$	395,748	$	135,169	$	221,172	$	13,508	$	765,597
Capital expenditures		6,465		7,540		7,438		936		22,379

Three months ended September 30, 2015
Net revenues	$	406,552	$	118,266	$	209,115	$	5,364	$	739,297
Capital expenditures		39,272		3,089		3,707		478		46,546

Nine months ended September 30, 2016
Net revenues	$	1,190,469	$	411,245	$	662,506	$	27,250	$	2,291,470
Capital expenditures		21,852		21,851		19,768		2,442		65,913

Nine months ended September 30, 2015
Net revenues	$	1,120,272	$	345,516	$	622,652	$	15,951	$	2,104,391
Capital expenditures		136,587		12,948		14,922		2,578		167,035

Balance sheet at September 30, 2016
Total assets		854,583		1,109,773		1,059,591		2,227,732		5,251,679
Investment in and advances to unconsolidated affiliates		79		—		94,369		63,856		158,304
Goodwill and other intangible assets, net		324,285		224,746		748,952		127,639		1,425,622

Balance sheet at December 31, 2015
Total assets		918,292		968,152		1,091,514		2,160,794		5,138,752
Investment in and advances to unconsolidated affiliates		84		—		103,608		64,457		168,149
Goodwill and other intangible assets, net		324,285		224,746		750,127		4,226		1,303,384

(1) Includes depreciation expense associated with the real property assets under the Master Lease with GLPI. In addition, total assets include these assets. The interest expense associated with the financing obligation is reflected in the other category. Net revenues and income (loss) from unconsolidated affiliates relate to the Company’s stand-alone racing operations, namely Rosecroft Raceway, which was sold during the quarter, Sanford Orlando Kennel Club and the Company’s Texas and New Jersey joint ventures which do not have gaming operations. Other also includes the recently created Penn Interactive Ventures, which is a wholly-owned subsidiary that is pursuing our new interactive gaming strategy and our recent acquisition of Rocket Games.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8971-108599

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8595-108599

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8380-108599

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8984-108599

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8538-108599

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599

+ Details

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2016
Income Taxes
Income Taxes	9. Income Taxes At September 30, 2016 and December 31, 2015, the Company had a net deferred tax liability balance of $120.2 million and $107.9 million, respectively, within its condensed consolidated balance sheets. The Company accounts for income taxes in accordance with ASC 740 “Income Taxes”. Under ASC 740, deferred tax assets and liabilities are determined based on the differences between the financial statement carrying amount and the tax bases of existing assets and liabilities and are measured at the prevailing enacted tax rates that will be in effect when these differences are settled or realized. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. In the fourth quarter of 2013, the Company concluded that as a result of the failed spin-off-leaseback accounting treatment which resulted in a significant increase to its deferred tax assets, a valuation allowance should be recorded on the Company’s deferred tax assets given the significant negative evidence associated with being in or expecting to be in a three year cumulative pre-tax loss position and the insufficient objectively verifiable positive evidence to support the realization of the Company’s deferred tax assets. As of September 30, 2016 and December 31, 2015, we have a valuation allowance which totaled $817.9 million and $844.3 million, respectively, only on the portion of the deferred tax assets that are more likely than not to be unrealized as a result of the negative objective evidence of being in a three year cumulative loss. The Company calculates the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate (“ETR”) to the full year projected pretax book income or loss excluding certain discrete items. The Company’s ETR (income taxes as a percentage of income from operations before income taxes) including discrete items was (25.56)% and 8.00% for the three and nine months ended September 30, 2016, as compared to 87.84% and 86.41% for the three and nine months ended September 30, 2015, primarily due to a year-over-year reduction to our federal and state valuation allowance coupled with an increase to earnings before income taxes. Additionally, in the third quarter of 2016, we had an income tax benefit of $12.0 million due to the recording of net deferred tax liabilities associated with intangible assets from our Rocket Games acquisition which reduced our valuation allowance need. Finally, the Company reached a tax settlement on our ongoing U.S. and Canadian Competent Authority case during the three months ended September 30, 2016 which resulted in a $9.8 million tax benefit.

Fair Value Measurements

9 Months Ended

Sep. 30, 2016

Fair Value Measurements

Fair Value Measurements

10. Fair Value Measurements

ASC 820, “Fair Value Measurements and Disclosures,” establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy are described below:

Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities.

Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions, as there is little, if any, related market activity.

The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy.

The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate:

Cash and cash equivalents

The fair value of the Company’s cash and cash equivalents approximates the carrying value of the Company’s cash and cash equivalents, due to the short maturity of the cash equivalents.

Long-term debt

The fair value of the Company’s Term Loan A and B components of its senior secured credit facility and senior unsecured notes is estimated based on quoted prices in active markets and as such is a Level 1 measurement. The fair value of the remainder of the Company’s senior secured credit facility approximates its carrying value as it is revolving, variable rate debt and as such is a Level 2 measurement.

Other long term obligations at September 30, 2016, included the relocation fees for Hollywood Gaming at Dayton Raceway and Hollywood Gaming at Mahoning Valley Race Course and the repayment obligation of a hotel and event center located near Hollywood Casino Lawrenceburg. The fair value of the relocation fees for Hollywood Gaming at Dayton Raceway and Hollywood Gaming at Mahoning Valley Race Course approximates its carrying value as the discount rate of 5.0% approximates the market rate of similar debt instruments and as such is a Level 2 measurement. Finally, the fair value of the repayment obligation for the hotel and event center is estimated based on a rate consistent with comparable municipal bonds and as such is a Level 2 measurement. See Note 6 for further details regarding the Company’s other long term obligations.

Other liabilities

Other liabilities at September 30, 2016 included the contingent purchase price consideration related to the purchase of Plainridge Racecourse and Rocket Games. The fair value of the Company’s contingent purchase price consideration related to its Plainridge Racecourse acquisition is estimated based on a discounted cash flow model and as such is a Level 3 measurement. The fair value of the Company’s contingent purchase price consideration related to its Rocket Games acquisition is estimated by applying an option pricing method using a Monte Carlo simulation which is a quantitative technique that estimates the distribution of an outcome variable that depends on probabilistic input variables and as such is a Level 3 measurement. At each reporting period, the Company assesses the fair value of these liabilities and changes in their fair values are recorded in earnings. The amount related to the change in fair value of these obligations resulted in a reduction to general and administrative expense of $0.3 million and $1.4 million for the three and nine months ended September 30, 2016, respectively, compared to a reduction of $6.7 million and $5.9 million for the three and nine months ended September 30, 2015, respectively.

The carrying amounts and estimated fair values by input level of the Company’s financial instruments at September 30, 2016 and December 31, 2015 are as follows (in thousands):


	September 30, 2016
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	201,868	$	201,868	$	201,868	$	—	$	—
Financial liabilities:
Long-term debt
Senior secured credit facility		1,217,420		1,231,429		797,429		434,000		—
Senior unsecured notes		296,734		310,500		310,500		—		—
Other long-term obligations		154,469		157,561		—		157,561		—
Other liabilities		66,610		66,610		—		—		66,610


	December 31, 2015
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	237,009	$	237,009	$	237,009	$	—	$	—
Financial liabilities:
Long-term debt
Senior secured credit facility		1,239,049		1,251,975		829,975		422,000		—
Senior unsecured notes		296,252		291,000		291,000		—		—
Other long-term obligations		146,992		147,358		—		147,358		—
Other liabilities		13,815		13,815		—		—		13,815

The following table summarizes the changes in fair value of the Company’s Level 3 liabilities (in thousands):


	Nine Months Ended
	September 30, 2016
	Liabilities
	Contingent
	Purchase Price
Balance at January 1, 2016	$	13,815

Additions		55,963
Payments		(1,793)
Included in earnings		(1,375)
Balance at September 30, 2016	$	66,610

The following table summarizes the significant unobservable inputs used in calculating fair value for our Level 3 liabilities:


	Valuation	Unobservable
	Technique	Input	Discount Rate		Volatility Rate
Contingent purchase price - Plainridge	Discounted cash flow	Discount rate	8.30	%	N/A	%
Contingent purchase price - Rocket Games	Option Pricing Method	Discount rate, Volatility rate	9.00	%	88.50	%

Investment In Unconsolidated Affiliates

9 Months Ended

Sep. 30, 2016

Investment In Unconsolidated Affiliates

Investment In Unconsolidated Affiliates

11. Investment in Unconsolidated Affiliates

The Company has a 50% investment in Kansas Entertainment, which is a joint venture with International Speedway Corporation (“International Speedway”). Kansas Entertainment owns Hollywood Casino at Kansas Speedway which is a Hollywood themed facility featuring 244,791 of property square footage with 2,000 slot machines, 40 table games and 12 poker tables, a 1,253 space parking structure, as well as a variety of dining and entertainment facilities. For the year ended December 31, 2015, the Company’s investment in Kansas Entertainment met the requirements of S-X Rule 4-08(g) to provide summarized financial information. The following table provides summary income statement information for Kansas Entertainment as required under S-X Rule 1-02(bb) for the comparative periods presented in the Company’s condensed consolidated statements of income.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Net revenues	$	37,513	$	37,326	$	115,267	$	116,066
Operating expenses		29,917		29,663		90,746		92,025
Income from operations		7,596		7,663		24,521		24,041
Net income	$	7,596	$	7,663	$	24,521	$	24,041

Net income attributable to Penn	$	3,798	$	3,831	$	12,261	$	12,020

Subsequent Events	9 Months Ended
Subsequent Events	Sep. 30, 2016
Subsequent Events
Subsequent Events	12. Subsequent Events On October 20, 2016, the Jamul Tribe obtained long term secured financing, consisting of revolving and term loan credit facilities (the “Credit Facilities”) totaling approximately $460 million. The Credit Facilities, all of which are due in 2022, consist of a $5 million revolving credit facility, a $340 million term loan B facility and a $98 million term loan C facility. The revolving credit facility was provided by various commercial banks; the term loan B facility is held by an affiliate of Och-Ziff Real Estate; and the term loan C facility is held by the Company. The Company will also provide up to an additional $15 million of delayed draw term loan C commitments to fund certain roadway improvement costs. The various Credit Facilities rank pari passu with each other. However, if, on the first anniversary of the opening of Hollywood Casino Jamul – San Diego (“the Casino”), the Jamul Tribe has not achieved a senior secured net leverage ratio equal to or less than 5.0 to 1.0, then all or a portion of the term loan C facility will become subordinated to the other Credit Facilities to the extent necessary such that, after giving effect to such conversion, such senior secured net leverage ratio is 5.0 to 1.0. The rights of the Company to receive management and intellectual property license fees are subordinated to the claims of the lenders under the Credit Facilities and are subject to certain conditions contained in the Credit Facilities. The Company was repaid on October 20, 2016, approximately $274 million of the advances to the Jamul Tribe for the development and construction of the property as well as previously purchased Jamul Tribal debt. The Company used these funds to reduce borrowings under its revolving credit facility. As a condition to the availability of the Credit Facilities, the Company provided a limited completion guarantee, in favor of the administrative agent under the Credit Facilities, to provide up to $15 million of additional loans related to the construction and opening of the Casino, as well as certain post opening construction costs. Of these loans, $10 million may be funded under the Credit Facilities as part of the term loan C facility, while any additional loans would be subordinated loans. The term loan C facility bears interest at LIBOR plus 8.50% with a 1% LIBOR floor (or, at the Jamul Tribe’s election, a base rate determined by reference to the prime rate, the federal funds effective rate or LIBOR, as applicable, plus 7.50%), and the subordinated loans will bear interest at 14.0% (with 12.0% to be paid in cash and 2.0% to be paid-in-kind).

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2016

Summary of Significant Accounting Policies

Revenue Recognition and Promotional Allowances

Revenue from the management service contract for Casino Rama is based upon contracted terms and is recognized when services are performed.

The amounts included in promotional allowances for the three and nine months ended September 30, 2016 and 2015 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	10,257	$	8,649	$	29,477	$	25,888
Food and beverage		32,977		28,245		94,295		82,896
Other		2,409		2,685		6,555		6,883
Total promotional allowances	$	45,643	$	39,579	$	130,327	$	115,667

The estimated cost of providing such complimentary services for the three and nine months ended September 30, 2016 and 2015 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	1,419	$	1,085	$	3,954	$	2,999
Food and beverage		12,488		11,280		36,212		32,761
Other		909		881		2,563		2,605
Total cost of complimentary services	$	14,816	$	13,246	$	42,729	$	38,365

Gaming and Racing Taxes

Long-term asset related to the Jamul Tribe

Earnings Per Share

The following table sets forth the allocation of net income for the three and nine months ended September 30, 2016 and 2015 under the two-class method:


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)				(in thousands)

Net income	$	46,535	$	4,900	$	104,278	$	9,752
Net income applicable to preferred stock		3,658		476		9,268		951
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801


	Three Months Ended September 30,	Three Months Ended September 30,	Nine Months Ended September 30,	Nine Months Ended September 30,
	2016	2015	2016	2015
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	83,065	80,243	81,917	79,803
Assumed conversion of dilutive employee stock-based awards	1,233	2,355	1,381	2,307
Assumed conversion of restricted stock	38	58	41	60
Diluted weighted-average common shares outstanding before participating security	84,336	82,656	83,339	82,170
Assumed conversion of preferred stock	7,086	8,624	7,991	8,624
Diluted weighted-average common shares outstanding	91,422	91,280	91,330	90,794


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
Calculation of basic EPS:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Weighted-average common shares outstanding		83,065		80,243		81,917		79,803
Basic EPS	$	0.52	$	0.06	$	1.16	$	0.11

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Diluted weighted-average common shares outstanding before participating security		84,336		82,656		83,339		82,170
Diluted EPS	$	0.51	$	0.05	$	1.14	$	0.11

Stock-Based Compensation


	2016		2015

Risk-free interest rate	1.20	%	1.53	%
Expected volatility	31.23	%	36.84	%
Dividend yield	—		—
Weighted-average expected life (years)	5.40		5.45

Segment Information

See Note 8 for further information with respect to the Company’s segments.

Other Comprehensive Income

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2016

Summary of Significant Accounting Policies

Schedule of promotional allowances


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	10,257	$	8,649	$	29,477	$	25,888
Food and beverage		32,977		28,245		94,295		82,896
Other		2,409		2,685		6,555		6,883
Total promotional allowances	$	45,643	$	39,579	$	130,327	$	115,667

Schedule of estimated cost of providing complimentary services


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)
Rooms	$	1,419	$	1,085	$	3,954	$	2,999
Food and beverage		12,488		11,280		36,212		32,761
Other		909		881		2,563		2,605
Total cost of complimentary services	$	14,816	$	13,246	$	42,729	$	38,365

Schedule of allocation of net income attributable to shareholders under the two-class method


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
	(in thousands)				(in thousands)

Net income	$	46,535	$	4,900	$	104,278	$	9,752
Net income applicable to preferred stock		3,658		476		9,268		951
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801

Schedule of reconciliation of the weighted-average common shares outstanding used in the calculation of basic EPS to the weighted-average common shares outstanding used in the calculation of diluted EPS


	Three Months Ended September 30,	Three Months Ended September 30,	Nine Months Ended September 30,	Nine Months Ended September 30,
	2016	2015	2016	2015
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	83,065	80,243	81,917	79,803
Assumed conversion of dilutive employee stock-based awards	1,233	2,355	1,381	2,307
Assumed conversion of restricted stock	38	58	41	60
Diluted weighted-average common shares outstanding before participating security	84,336	82,656	83,339	82,170
Assumed conversion of preferred stock	7,086	8,624	7,991	8,624
Diluted weighted-average common shares outstanding	91,422	91,280	91,330	90,794

Schedule of calculation of basic and diluted EPS for the entity's common stock


	Three Months Ended September 30,		Three Months Ended September 30,		Nine Months Ended September 30,		Nine Months Ended September 30,
	2016		2015		2016		2015
Calculation of basic EPS:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Weighted-average common shares outstanding		83,065		80,243		81,917		79,803
Basic EPS	$	0.52	$	0.06	$	1.16	$	0.11

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	42,877	$	4,424	$	95,010	$	8,801
Diluted weighted-average common shares outstanding before participating security		84,336		82,656		83,339		82,170
Diluted EPS	$	0.51	$	0.05	$	1.14	$	0.11

Weighted-average assumptions used in Black-Scholes option pricing model


	2016		2015

Risk-free interest rate	1.20	%	1.53	%
Expected volatility	31.23	%	36.84	%
Dividend yield	—		—
Weighted-average expected life (years)	5.40		5.45

Property and Equipment (Tables)

9 Months Ended

Sep. 30, 2016

Property and Equipment

Schedule of property and equipment, net


	September 30,		December 31,
	2016		2015
	(in thousands)

Property and equipment - non-leased
Land and improvements	$	289,159	$	288,910
Building and improvements		402,532		396,497
Furniture, fixtures and equipment		1,351,761		1,303,153
Leasehold improvements		109,882		129,012
Construction in progress		14,491		9,175
		2,167,825		2,126,747
Less Accumulated depreciation		(1,200,804)		(1,093,115)
		967,021		1,033,632
Property and equipment - master lease
Land and improvements		382,246		382,246
Building and improvements		2,219,018		2,219,018
		2,601,264		2,601,264
Less accumulated depreciation		(723,293)		(654,828)
		1,877,971		1,946,436
Property and equipment, net	$	2,844,992	$	2,980,068

Long-term Debt (Tables)

9 Months Ended

Sep. 30, 2016

Long-term Debt

Schedule of long-term debt, net of current maturities


	September 30,		December 31,
	2016		2015
	(in thousands)

Senior secured credit facility	$	1,232,818	$	1,259,740
$300 million 5.875 % senior unsecured notes due November 1, 2021		300,000		300,000
Other long-term obligations		154,469		146,992
Capital leases		2,215		28,466
		1,689,502		1,735,198
Less current maturities of long-term debt		(81,741)		(92,108)
Less net discounts		(636)		(686)
Less debt issuance costs, net of accumulated amortization of $18.7 million and $13.3 million, respectively		(17,909)		(23,553)
	$	1,589,216	$	1,618,851

Schedule of future minimum repayments of long-term debt

The following is a schedule of future minimum repayments of long-term debt as of September 30, 2016 (in thousands):


Within one year	$	81,631
1-3 years		966,934
3-5 years		285,048
Over 5 years		355,889
Total minimum payments	$	1,689,502

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6479336&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=64930739&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

+ Details

Segment Information (Tables)

9 Months Ended

Sep. 30, 2016

Segment Information

Schedule of information with respect to the Company's segments


Three months ended September 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	101,752	$	19,337	$	56,343	$	(38,132)	$	139,300
Charge for stock compensation		—		—		—		1,517		1,517
Depreciation and amortization		22,975		9,097		9,593		26,238		67,903
Contingent purchase price		(293)		—		—		263		(30)
(Gain) loss on disposal of assets		(13)		72		64		(2,904)		(2,781)
Insurance recoveries		—		—		(726)		—		(726)
Income (loss) from unconsolidated affiliates		—		—		3,798		(293)		3,505
Non-operating items for Kansas JV		—		—		2,572		—		2,572
Adjusted EBITDA	$	124,421	$	28,506	$	71,644	$	(13,311)	$	211,260

Three months ended September 30, 2015	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	107,148	$	22,307	$	52,521	$	(39,804)	$	142,172
Charge for stock compensation		—		—		—		2,025		2,025
Depreciation and amortization		24,350		6,971		9,984		24,836		66,141
Contingent purchase price		(6,651)		—		—		—		(6,651)
Loss on disposal of assets		33		185		34		24		276
Income (loss) from unconsolidated affiliates		—		—		3,831		(72)		3,759
Non-operating items for Kansas JV		—		—		2,540		—		2,540
Adjusted EBITDA	$	124,880	$	29,463	$	68,910	$	(12,991)	$	210,262


Nine months ended September 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	306,368	$	72,944	$	172,013	$	(122,157)	$	429,168
Charge for stock compensation		—		—		—		4,554		4,554
Depreciation and amortization		69,177		26,701		28,621		75,606		200,105
Contingent purchase price		(1,374)		—		—		263		(1,111)
(Gain) loss on disposal of assets		(6)		58		18		(3,510)		(3,440)
Insurance recoveries		—		—		(726)		—		(726)
Income (loss) from unconsolidated affiliates		—		—		12,261		(599)		11,662
Non-operating items for Kansas JV		—		—		7,713		—		7,713
Adjusted EBITDA	$	374,165	$	99,703	$	219,900	$	(45,843)	$	647,925

Nine months ended September 30, 2015	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	274,995	$	81,910	$	160,631	$	(140,314)	$	377,222
Charge for stock compensation		—		—		—		6,446		6,446
Depreciation and amortization		70,016		17,091		29,846		74,832		191,785
Contingent purchase price		(5,944)		—		—		—		(5,944)
Loss on disposal of assets		40		585		28		148		801
Income (loss) from unconsolidated affiliates		—		—		12,021		(126)		11,895
Non-operating items for Kansas JV		—		—		7,818		—		7,818
Adjusted EBITDA	$	339,107	$	99,586	$	210,344	$	(59,014)	$	590,023


		Northeast		South/West		Midwest		Other (1)		Total
	(in thousands)
Three months ended September 30, 2016
Net revenues	$	395,748	$	135,169	$	221,172	$	13,508	$	765,597
Capital expenditures		6,465		7,540		7,438		936		22,379

Three months ended September 30, 2015
Net revenues	$	406,552	$	118,266	$	209,115	$	5,364	$	739,297
Capital expenditures		39,272		3,089		3,707		478		46,546

Nine months ended September 30, 2016
Net revenues	$	1,190,469	$	411,245	$	662,506	$	27,250	$	2,291,470
Capital expenditures		21,852		21,851		19,768		2,442		65,913

Nine months ended September 30, 2015
Net revenues	$	1,120,272	$	345,516	$	622,652	$	15,951	$	2,104,391
Capital expenditures		136,587		12,948		14,922		2,578		167,035

Balance sheet at September 30, 2016
Total assets		854,583		1,109,773		1,059,591		2,227,732		5,251,679
Investment in and advances to unconsolidated affiliates		79		—		94,369		63,856		158,304
Goodwill and other intangible assets, net		324,285		224,746		748,952		127,639		1,425,622

Balance sheet at December 31, 2015
Total assets		918,292		968,152		1,091,514		2,160,794		5,138,752
Investment in and advances to unconsolidated affiliates		84		—		103,608		64,457		168,149
Goodwill and other intangible assets, net		324,285		224,746		750,127		4,226		1,303,384

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2016

Fair Value Measurements

Schedule of carrying amount and estimated fair values of financial instruments

The carrying amounts and estimated fair values by input level of the Company’s financial instruments at September 30, 2016 and December 31, 2015 are as follows (in thousands):


	September 30, 2016
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	201,868	$	201,868	$	201,868	$	—	$	—
Financial liabilities:
Long-term debt
Senior secured credit facility		1,217,420		1,231,429		797,429		434,000		—
Senior unsecured notes		296,734		310,500		310,500		—		—
Other long-term obligations		154,469		157,561		—		157,561		—
Other liabilities		66,610		66,610		—		—		66,610


	December 31, 2015
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	237,009	$	237,009	$	237,009	$	—	$	—
Financial liabilities:
Long-term debt
Senior secured credit facility		1,239,049		1,251,975		829,975		422,000		—
Senior unsecured notes		296,252		291,000		291,000		—		—
Other long-term obligations		146,992		147,358		—		147,358		—
Other liabilities		13,815		13,815		—		—		13,815

Summary of the changes in fair value of Level 3 liabilities

The following table summarizes the changes in fair value of the Company’s Level 3 liabilities (in thousands):


	Nine Months Ended
	September 30, 2016
	Liabilities
	Contingent
	Purchase Price
Balance at January 1, 2016	$	13,815

Additions		55,963
Payments		(1,793)
Included in earnings		(1,375)
Balance at September 30, 2016	$	66,610

Summary of significant unobservable inputs used in calculating fair value Level 3 liabilities


	Valuation	Unobservable
	Technique	Input	Discount Rate		Volatility Rate
Contingent purchase price - Plainridge	Discounted cash flow	Discount rate	8.30	%	N/A	%
Contingent purchase price - Rocket Games	Option Pricing Method	Discount rate, Volatility rate	9.00	%	88.50	%

Investment in Unconsolidated Affiliates (Tables)

9 Months Ended

Sep. 30, 2016

Investment In Unconsolidated Affiliates

Schedule of summary financial information for Kansas Entertainment for the comparative periods presented in the Company's condensed consolidated statements of income


	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Net revenues	$	37,513	$	37,326	$	115,267	$	116,066
Operating expenses		29,917		29,663		90,746		92,025
Income from operations		7,596		7,663		24,521		24,041
Net income	$	7,596	$	7,663	$	24,521	$	24,041

Net income attributable to Penn	$	3,798	$	3,831	$	12,261	$	12,020

Organization and Basis of Presentation (Details)	Sep. 30, 2016 jurisdiction facility
Organization and Basis of Presentation
Number of facilities the entity owned, managed, or had ownership interests in \| facility	26
Number of jurisdictions in which the entity operates \| jurisdiction	16

Summary of Significant Accounting Policies - Revenue Recognition, Promotional Allowances, and Gaming and Racing Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenue recognition
Promotional allowances	$ 45,643	$ 39,579	$ 130,327	$ 115,667
Cost of complimentary services	14,816	13,246	42,729	38,365
Gaming and Racing Taxes
Gaming expense	257,000	259,400	772,900	730,900
Rooms
Revenue recognition
Promotional allowances	10,257	8,649	29,477	25,888
Cost of complimentary services	1,419	1,085	3,954	2,999
Food and beverage
Revenue recognition
Promotional allowances	32,977	28,245	94,295	82,896
Cost of complimentary services	12,488	11,280	36,212	32,761
Other
Revenue recognition
Promotional allowances	2,409	2,685	6,555	6,883
Cost of complimentary services	$ 909	$ 881	$ 2,563	$ 2,605

Summary of Significant Accounting Policies - Long-term Asset Related to Jamul Tribe (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2016 USD ($) a ft² item	Dec. 31, 2015 USD ($)
Financing provided
Advances to the Jamul Tribe \| $	$ 360,938	$ 197,722
Jamul Tribe
Long-term asset related to the Jamul Tribe
Land owned (in acres) \| a	6
Hollywood Casino Jamul - San Diego
Number of stories at facility	3
Size of gaming floor at and entertainment facility (in square feet) \| ft²	200,000
Number of slot machines at facility	1,731
Number of table games at facility	40
Number of parking spaces	1,800
Jamul Tribe \| Senior Loans
Financing provided
Advances to the Jamul Tribe \| $	$ 360,900	197,700
Accrued interest \| $	$ 33,200	$ 13,900

Summary of Significant Accounting Policies - Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Earnings Per Share
Conversion of preferred stock (in shares)	516,000		1,693,000
Net income loss available to common stockholders
Net income	$ 46,535	$ 4,900	$ 104,278	$ 9,752
Net income applicable to preferred stock	3,658	476	9,268	951
Net income applicable to common stock	$ 42,877	$ 4,424	$ 95,010	$ 8,801
Determination of shares:
Weighted-average common shares outstanding (in shares)	83,065,000	80,243,000	81,917,000	79,803,000
Assumed conversion of dilutive employee stock-based awards (in shares)	1,233,000	2,355,000	1,381,000	2,307,000
Assumed conversion of restricted stock (in shares)	38,000	58,000	41,000	60,000
Diluted weighted-average common shares outstanding before participating security	84,336,000	82,656,000	83,339,000	82,170,000
Assumed conversion of preferred stock (in shares)	7,086,000	8,624,000	7,991,000	8,624,000
Diluted weighted-average common shares outstanding (in shares)	91,422,000	91,280,000	91,330,000	90,794,000
Calculation of basic EPS:
Net income applicable to common stock	$ 42,877	$ 4,424	$ 95,010	$ 8,801
Weighted-average common shares outstanding (in shares)	83,065,000	80,243,000	81,917,000	79,803,000
Basic EPS (in dollars per share)	$ 0.52	$ 0.06	$ 1.16	$ 0.11
Calculation of diluted EPS using two class method:
Net income applicable to common stock	$ 42,877	$ 4,424	$ 95,010	$ 8,801
Diluted weighted-average common shares outstanding before participating security	84,336,000	82,656,000	83,339,000	82,170,000
Diluted EPS (in dollars per share)	$ 0.51	$ 0.05	$ 1.14	$ 0.11
Anti-dilutive securities, options to purchase shares outstanding			2,990,243	1,621,219
Series C Preferred Stock
Earnings Per Share
Preferred stock, shares outstanding	6,931	8,624	6,931	8,624	8,624
Shares converted (in shares)	516		1,693

Summary of Significant Accounting Policies - Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Stock-based compensation costs
Compensation benefit related to stock-based compensation, pre tax	$ 1,500	$ 2,000	$ 4,600	$ 6,400
Time period of historical volatility of stock used to estimate expected volatility			5 years 4 months 24 days
Dividend yield (as a percent)			0.00%
Granted (in shares)			1,573,651
Accrued salaries and wages	80,697		$ 80,697		$ 98,671
Stock based compensation benefit			$ 8,510	$ 10,143
Weighted-average assumptions used in the Black-Scholes option-pricing model
Risk-free interest rate (as a percent)			1.20%	1.53%
Expected volatility (as a percent)			31.23%	36.84%
Dividend yield (as a percent)			0.00%
Weighted-average expected life			5 years 4 months 24 days	5 years 5 months 12 days
Phantom Share Units (PSUs)
Stock-based compensation costs
Accrued salaries and wages	2,900		$ 2,900		7,800
Total compensation cost related to nonvested awards not yet recognized	8,800		$ 8,800
Period for recognition of unrecognized compensation cost			1 year 5 months 12 days
Stock based compensation expense	2,100	1,900	$ 5,700	$ 11,400
Amounts paid on cash settled awards	5,400	7,600	$ 9,900	12,900
Phantom Share Units (PSUs) \| Minimum
Stock-based compensation costs
Vesting period			3 years
Phantom Share Units (PSUs) \| Maximum
Stock-based compensation costs
Vesting period			4 years
Stock appreciation rights (SARs)
Stock-based compensation costs
Vesting period			4 years
Accrued salaries and wages	7,100		$ 7,100		$ 8,000
Total compensation cost related to nonvested awards not yet recognized	4,300		$ 4,300
Period for recognition of unrecognized compensation cost			2 years 8 months 19 days
Stock based compensation benefit		3,000
Stock based compensation expense	400		$ 1,800	4,100
Amounts paid on cash settled awards	$ 1,000	$ 300	$ 2,500	$ 2,600

Summary of Significant Accounting Policies - Segment Information (Details) - segment	3 Months Ended	9 Months Ended
	Jun. 30, 2016	Sep. 30, 2016	Sep. 01, 2015
Segment Information
Number of reportable segments	3	3
Kansas Entertainment
Segment Information
Ownership interest in joint venture (as a percent)			50.00%
Penn Interactive Ventures
Segment Information
Percentage of net revenues		0.50%
Percentage of income from operations		0.40%

Acquisitions (Details) $ in Thousands	Aug. 01, 2016 USD ($)	Sep. 30, 2016 USD ($)	Dec. 31, 2015 USD ($)
Preliminary purchase price allocation
Goodwill		$ 993,633	$ 911,942
Rocket Games
Acquisitions
Percentage of outstanding equity securities acquired	100.00%
Initial cash consideration	$ 59,100
Period over which contingent consideration payments are due	2 years
Multiple applied to then-trailing 12 months of EBITDA to determine contingent consideration	6.25
Contingent purchase price consideration	$ 56,000
Preliminary purchase price allocation
Goodwill	81,700
Other intangible assets	43,400
Current assets	7,700
Other assets	300
Current contingent consideration liabilities	28,200
Other current liabilities	5,900
Non-current contingent consideration liabilities	27,800
Deferred tax liabilities	12,100
Rocket Games \| Maximum
Acquisitions
Contingent purchase price consideration	$ 110,000
Rocket Games \| Employee Retention Compensation
Acquisitions
Period over which contingent consideration payments are due	2 years
Rocket Games \| Employee Retention Compensation \| Maximum
Acquisitions
Contingent purchase price consideration	$ 10,000

Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Plant and equipment
Property and equipment, net	$ 2,844,992		$ 2,844,992		$ 2,980,068
Increase (decrease) in property and equipment			(135,100)
Depreciation expense	65,500		196,800
Interest capitalized in connection with major construction projects	0	$ 0	0	$ 1,800
Master Lease Agreement
Plant and equipment
Depreciation expense	22,700		68,400
Land and improvements - non-leased
Plant and equipment
Property and equipment	289,159		289,159		288,910
Land and improvements - master lease
Plant and equipment
Property and equipment	382,246		382,246		382,246
Building and improvements - non-leased
Plant and equipment
Property and equipment	402,532		402,532		396,497
Buildings and improvements - master lease
Plant and equipment
Property and equipment	2,219,018		2,219,018		2,219,018
Furniture, fixtures and equipment
Plant and equipment
Property and equipment	1,351,761		1,351,761		1,303,153
Leasehold improvements
Plant and equipment
Property and equipment	109,882		109,882		129,012
Construction in progress - non-leased
Plant and equipment
Property and equipment	14,491		14,491		9,175
Non-leased assets
Plant and equipment
Property and equipment	2,167,825		2,167,825		2,126,747
Less Accumulated depreciation	(1,200,804)		(1,200,804)		(1,093,115)
Property and equipment, net	967,021		967,021		1,033,632
Master lease assets
Plant and equipment
Property and equipment	2,601,264		2,601,264		2,601,264
Less Accumulated depreciation	(723,293)		(723,293)		(654,828)
Property and equipment, net	$ 1,877,971		$ 1,877,971		$ 1,946,436

Long-term Debt - Debt Summary (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Long-term Debt
Long-term debt	$ 1,689,502	$ 1,735,198
Less current maturities of long-term debt	(81,741)	(92,108)
Less net discounts	(636)	(686)
Less debt issuance costs, net of accumulated amortization of $16.9 million and $13.3 million, respectively	(17,909)	(23,553)
Long-term debt, net of current maturities and debt issuance costs	1,589,216	1,618,851
Accumulated amortization for debt issuance costs	18,700	13,300
Senior Secured Credit Facility
Long-term Debt
Long-term debt	1,232,818	1,259,740
$300 million 5.875% senior unsecured notes due November 1, 2021
Long-term Debt
Long-term debt	$ 300,000	$ 300,000
Interest rate (as a percent)	5.875%	5.875%
Principal amount	$ 300,000
Other long-term obligations
Long-term Debt
Long-term debt	154,469	$ 146,992
Capital leases
Long-term Debt
Long-term debt	$ 2,215	$ 28,466

Long-term Debt - Senior Secured Credit Facility (Details) - USD ($) $ in Thousands			9 Months Ended
	Sep. 30, 2016	Apr. 28, 2015	Sep. 30, 2016	Dec. 31, 2015	Aug. 31, 2015
Long-term Debt
Long-term debt	$ 1,689,502		$ 1,689,502	$ 1,735,198
Future minimum repayments of long-term debt
Within one year	81,631		81,631
1-3 years	966,934		966,934
3-5 years	285,048		285,048
Over 5 years	355,889		355,889
Long-term debt	1,689,502		1,689,502	1,735,198
Revolving credit facility
Long-term Debt
Term of debt		5 years
Maximum borrowing capacity		$ 500,000			$ 633,200
Term loan amount outstanding	434,000		434,000
Available borrowing capacity	176,200		176,200
Term Loan A Facility
Long-term Debt
Term of debt		5 years
Maximum borrowing capacity		$ 500,000
Increase in maximum borrowing capacity					$ 146,700
Term loan amount outstanding	555,700		$ 555,700
Term Loan B Facility
Long-term Debt
Term of debt			7 years
Maximum borrowing capacity	250,000		$ 250,000
Term loan amount outstanding	243,100		243,100
Senior Secured Credit Facility
Long-term Debt
Term loan amount outstanding	1,232,800		1,232,800
Long-term debt	1,232,818		1,232,818	1,259,740
Letters of credit outstanding	23,000		23,000
Future minimum repayments of long-term debt
Long-term debt	$ 1,232,818		$ 1,232,818	$ 1,259,740
$300 million 5.875% senior unsecured notes due November 1, 2021
Long-term Debt
Interest rate (as a percent)	5.875%		5.875%	5.875%
Long-term debt	$ 300,000		$ 300,000	$ 300,000
Future minimum repayments of long-term debt
Long-term debt	300,000		300,000	300,000
Other long-term obligations
Long-term Debt
Long-term debt	154,469		154,469	146,992
Future minimum repayments of long-term debt
Long-term debt	$ 154,469		$ 154,469	$ 146,992
Corporate airplane loan
Long-term Debt
Term of debt	5 years
Interest rate (as a percent)	5.22%		5.22%
Monthly payments	$ 220
Balloon payment	$ 12,600		$ 12,600

Master Lease Financing Obligation (Details) - Master Lease Agreement - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Capital Leased Assets
Discount rate (as a percent)			9.70%
Total payments under Master Lease	$ 109.7	$ 109.0	$ 331.9	$ 327.3
Interest expense for the Master Lease	$ 97.4	$ 97.8	$ 293.9	$ 291.9

Segment Information (Details) $ in Thousands	3 Months Ended			9 Months Ended
Segment Information (Details) $ in Thousands	Sep. 30, 2016 USD ($)	Jun. 30, 2016 segment	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) segment	Sep. 30, 2015 USD ($)	Dec. 31, 2015 USD ($)
Segment information
Number of reportable segments \| segment		3		3
Income (loss) from operations	$ 139,300		$ 142,172	$ 429,168	$ 377,222
Charge for stock compensation	1,517		2,025	4,554	6,446
Depreciation and amortization	67,903		66,141	200,105	191,785
Contingent purchase price	(30)		(6,651)	(1,111)	(5,944)
(Gain) loss on disposal of assets	(2,781)		276	(3,440)	801
Insurance recoveries	(726)			(726)
Income from unconsolidated affiliates	3,505		3,759	11,662	11,895
Adjusted EBITDA	211,260		210,262	647,925	590,023
Net revenues	765,597		739,297	2,291,470	2,104,391
Capital expenditures	22,379		46,546	65,913	167,035
Total assets	5,251,679			5,251,679		$ 5,138,752
Investment in and advances to unconsolidated affiliates	158,304			158,304		168,149
Goodwill and other intangible assets, net	1,425,622			1,425,622		1,303,384
Kansas Entertainment
Segment information
Non-operating items	2,572		2,540	7,713	7,818
Operating Segments \| Northeast
Segment information
Income (loss) from operations	101,752		107,148	306,368	274,995
Depreciation and amortization	22,975		24,350	69,177	70,016
Contingent purchase price	(293)		(6,651)	(1,374)	(5,944)
(Gain) loss on disposal of assets	(13)		33	(6)	40
Adjusted EBITDA	124,421		124,880	374,165	339,107
Net revenues	395,748		406,552	1,190,469	1,120,272
Capital expenditures	6,465		39,272	21,852	136,587
Total assets	854,583			854,583		918,292
Investment in and advances to unconsolidated affiliates	79			79		84
Goodwill and other intangible assets, net	324,285			324,285		324,285
Operating Segments \| South/West
Segment information
Income (loss) from operations	19,337		22,307	72,944	81,910
Depreciation and amortization	9,097		6,971	26,701	17,091
(Gain) loss on disposal of assets	72		185	58	585
Adjusted EBITDA	28,506		29,463	99,703	99,586
Net revenues	135,169		118,266	411,245	345,516
Capital expenditures	7,540		3,089	21,851	12,948
Total assets	1,109,773			1,109,773		968,152
Goodwill and other intangible assets, net	224,746			224,746		224,746
Operating Segments \| Midwest
Segment information
Income (loss) from operations	56,343		52,521	172,013	160,631
Depreciation and amortization	9,593		9,984	28,621	29,846
(Gain) loss on disposal of assets	64		34	18	28
Insurance recoveries	(726)			(726)
Income from unconsolidated affiliates	3,798		3,831	12,261	12,021
Adjusted EBITDA	71,644		68,910	219,900	210,344
Net revenues	221,172		209,115	662,506	622,652
Capital expenditures	7,438		3,707	19,768	14,922
Total assets	1,059,591			1,059,591		1,091,514
Investment in and advances to unconsolidated affiliates	94,369			94,369		103,608
Goodwill and other intangible assets, net	748,952			748,952		750,127
Operating Segments \| Midwest \| Kansas Entertainment
Segment information
Non-operating items	2,572		2,540	7,713	7,818
Other
Segment information
Income (loss) from operations	(38,132)		(39,804)	(122,157)	(140,314)
Charge for stock compensation	1,517		2,025	4,554	6,446
Depreciation and amortization	26,238		24,836	75,606	74,832
Contingent purchase price	263			263
(Gain) loss on disposal of assets	(2,904)		24	(3,510)	148
Income from unconsolidated affiliates	(293)		(72)	(599)	(126)
Adjusted EBITDA	(13,311)		(12,991)	(45,843)	(59,014)
Net revenues	13,508		5,364	27,250	15,951
Capital expenditures	936		$ 478	2,442	$ 2,578
Total assets	2,227,732			2,227,732		2,160,794
Investment in and advances to unconsolidated affiliates	63,856			63,856		64,457
Goodwill and other intangible assets, net	$ 127,639			$ 127,639		$ 4,226

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Income Taxes (Details) - USD ($) $ in Millions	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Income Taxes
Net deferred income tax liability	$ 120.2		$ 120.2		$ 107.9
Valuation allowance	817.9		$ 817.9		$ 844.3
Income tax benefit from settlement of uncertain tax positions	$ 9.8
Percent of pretax income
Actual effective income tax rate (as a percent)	(25.56%)	87.84%	8.00%	86.41%
Correction of the failed spin-off-leaseback accounting treatment
Income Taxes
Period of cumulative pre-tax loss position			3 years
Rocket Games
Income Taxes
Income tax benefit due to change in valuation allowance after recording acquired deferred tax liabilities	$ 12.0

Fair Value Measurements (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Fair Value Measurements (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Hollywood Gaming at Dayton Raceway And Mahoning Valley Race Course
Fair value of assets and liabilities
Discount Rate			5.00%
Contingent Purchase Price
Financial liabilities:
Balance at beginning of the period			$ 13,815
Total (gains) (realized or unrealized):
Additions			55,963
Payments			(1,793)
Included in earnings			(1,375)
Balance at end of the period	$ 66,610		66,610
Contingent Purchase Price \| Plainridge
Fair value of assets and liabilities
Reduction to general and administrative expense related to change in fair value measurement of contingent obligations	300	$ 6,700	$ 1,400	$ 5,900
Contingent Purchase Price \| Discounted Cash Flow \| Plainridge
Fair value of assets and liabilities
Discount Rate			8.30%
Contingent Purchase Price \| Option Pricing Method \| Rocket Games
Fair value of assets and liabilities
Discount Rate			9.00%
Volatility rate			88.50%
Level 1
Financial assets:
Cash and cash equivalents	201,868		$ 201,868		$ 237,009
Level 3
Financial liabilities:
Long-term debt	66,610		66,610		13,815
Senior Secured Credit Facility \| Level 1
Financial liabilities:
Long-term debt	797,429		797,429		829,975
Senior Secured Credit Facility \| Level 2
Financial liabilities:
Long-term debt	434,000		434,000		422,000
Senior Unsecured Notes \| Level 1
Financial liabilities:
Long-term debt	310,500		310,500		291,000
Other long-term obligations \| Level 2
Financial liabilities:
Long-term debt	157,561		157,561		147,358
Carrying Amount
Financial assets:
Cash and cash equivalents	201,868		201,868		237,009
Financial liabilities:
Long-term debt	66,610		66,610		13,815
Carrying Amount \| Senior Secured Credit Facility
Financial liabilities:
Long-term debt	1,217,420		1,217,420		1,239,049
Carrying Amount \| Senior Unsecured Notes
Financial liabilities:
Long-term debt	296,734		296,734		296,252
Carrying Amount \| Other long-term obligations
Financial liabilities:
Long-term debt	154,469		154,469		146,992
Fair Value
Financial assets:
Cash and cash equivalents	201,868		201,868		237,009
Financial liabilities:
Long-term debt	66,610		66,610		13,815
Fair Value \| Senior Secured Credit Facility
Financial liabilities:
Long-term debt	1,231,429		1,231,429		1,251,975
Fair Value \| Senior Unsecured Notes
Financial liabilities:
Long-term debt	310,500		310,500		291,000
Fair Value \| Other long-term obligations
Financial liabilities:
Long-term debt	$ 157,561		$ 157,561		$ 147,358

Investment in Unconsolidated Affiliates (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2016 USD ($) ft² item	Sep. 30, 2015 USD ($)
Summary financial information
Net income attributable to Penn	$ 3,505	$ 3,759	$ 11,662	$ 11,895
Kansas Entertainment
Business ventures
Ownership interest in joint venture under agreement of sale (as a percent)	50.00%		50.00%
Area of Casino (in square foot) \| ft²			244,791
Number of slot machines \| item			2,000
Number of table games \| item			40
Number of poker tables \| item			12
Number of space parking \| item			1,253
Summary financial information
Net revenues	$ 37,513	37,326	$ 115,267	116,066
Operating expenses	29,917	29,663	90,746	92,025
Income from operations	7,596	7,663	24,521	24,041
Net income	7,596	7,663	24,521	24,041
Net income attributable to Penn	$ 3,798	$ 3,831	$ 12,261	$ 12,020

Subsequent Events - Jamul Tribe Credit Facilities (Details) - Jamul Tribe - Subsequent event $ in Millions	Oct. 20, 2016 USD ($)
Credit Facilities
Subsequent events
Credit facilities borrowing capacity	$ 460
Credit Facilities \| Maximum
Subsequent events
Senior secured net leverage ratio requirement	5.0
Revolving credit facility - Commercial banks
Subsequent events
Credit facilities borrowing capacity	$ 5
Term Loan B Facility
Subsequent events
Credit facilities borrowing capacity	340
Term Loan C Facility
Subsequent events
Credit facilities borrowing capacity	98
Delayed Draw Term Loan C Facility Commitments \| Maximum
Subsequent events
Credit facilities borrowing capacity	$ 15

Subsequent Events - Financing Extended to Jamul Tribe (Details) - Jamul Tribe - Subsequent event $ in Millions	Oct. 20, 2016 USD ($)
Subsequent events
Advances repaid	$ 274
Term Loan C Facility
Subsequent events
Borrowing capacity under the financing facility	98
Additional borrowing capacity under the financing facility	$ 10
Term Loan C Facility \| LIBOR
Subsequent events
Financing interest rate margin (as a percent)	8.50%
Financing interest rate margin - Rate two (as a percent)	7.50%
Term Loan C Facility \| LIBOR \| Minimum
Subsequent events
Financing variable floor rate (as a percent)	1.00%
Term Loan C Facility \| Prime Rate
Subsequent events
Financing interest rate margin (as a percent)	7.50%
Term Loan C Facility \| Federal Funds Effective Rate
Subsequent events
Financing interest rate margin (as a percent)	7.50%
Delayed Draw Term Loan C Facility Commitments \| Maximum
Subsequent events
Additional borrowing capacity under the financing facility	$ 15
Subordinated Loans
Subsequent events
Financing interest rate (as a percent)	14.00%
Portion of contract financing interest rate to be paid in cash (as a percent)	12.00%
Portion of contract interest rate to be paid-in-kind (as a percent)	2.00%