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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2017	Jul. 28, 2017
Document and Entity Information
Entity Registrant Name	PENN NATIONAL GAMING INC
Entity Central Index Key	0000921738
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
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		91,336,780
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents	$ 224,399	$ 229,510
Receivables, net of allowance for doubtful accounts of $3,118 and $3,180 at June 30, 2017 and December 31, 2016, respectively	48,984	61,855
Prepaid expenses	48,213	59,707
Other current assets	51,957	48,193
Total current assets	373,553	399,265
Property and equipment, net	2,827,717	2,820,383
Other assets
Investment in and advances to unconsolidated affiliates	152,913	156,176
Goodwill	1,025,887	989,685
Other intangible assets, net	430,332	435,494
Loans to the Jamul Tribe, net of reserves of $5,635 at June 30, 2017 and $0 at December 31, 2016	84,152	91,401
Other assets	89,465	82,080
Total other assets	1,782,749	1,754,836
Total assets	4,984,019	4,974,484
Current liabilities
Current portion of financing obligation to GLPI	61,302	56,595
Current maturities of long-term debt	35,675	85,595
Accounts payable	28,975	35,091
Accrued expenses	113,529	101,906
Accrued interest	13,096	6,345
Accrued salaries and wages	86,292	92,238
Gaming, pari-mutuel, property, and other taxes	56,757	60,384
Insurance financing	3,222	2,636
Other current liabilities	101,728	95,526
Total current liabilities	500,576	536,316
Long-term liabilities
Long-term financing obligation to GLPI, net of current portion	3,506,053	3,457,485
Long-term debt, net of current maturities and debt issuance costs	1,303,023	1,329,939
Deferred income taxes	129,011	126,924
Noncurrent tax liabilities	27,062	26,791
Other noncurrent liabilities	35,819	40,349
Total long-term liabilities	5,000,968	4,981,488
Shareholders' deficit
Common stock ($.01 par value, 200,000,000 shares authorized, 93,507,060 and 93,289,701 shares issued, and 91,339,667 and 91,122,308 shares outstanding at June 30, 2017 and December 31, 2016, respectively)	934	932
Treasury stock, at cost (2,167,393 shares held at June 30, 2017 and December 31, 2016)	(28,414)	(28,414)
Additional paid-in capital	1,016,075	1,014,119
Retained deficit	(1,503,098)	(1,525,281)
Accumulated other comprehensive loss	(3,022)	(4,676)
Total shareholders' deficit	(517,525)	(543,320)
Total liabilities and shareholders' deficit	4,984,019	4,974,484
Series B Preferred Stock
Shareholders' deficit
Preferred stock
Series C Preferred Stock
Shareholders' deficit
Preferred stock

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Receivables, allowance for doubtful accounts (in dollars)	$ 3,118	$ 3,180
Loans to the Jamul Tribe, reserves	$ 5,635	$ 0
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	93,507,060	93,289,701
Common stock, shares outstanding	91,339,667	91,122,308
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	0	0
Preferred stock, shares outstanding	0	0

Condensed Consolidated Statements of Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Revenues
Gaming	$ 680,979	$ 663,326	$ 1,342,235	$ 1,320,027
Food, beverage, hotel and other	152,148	144,390	299,889	282,238
Management service and licensing fees	2,932	2,964	5,259	5,437
Reimbursable management costs	6,387	2,855	13,145	2,855
Revenues	842,446	813,535	1,660,528	1,610,557
Less promotional allowances	(45,983)	(44,113)	(87,841)	(84,684)
Net revenues	796,463	769,422	1,572,687	1,525,873
Operating expenses
Gaming	345,156	339,201	677,209	674,518
Food, beverage, hotel and other	105,231	101,873	206,306	199,952
General and administrative	130,096	109,974	255,911	226,478
Reimbursable management costs	6,387	2,855	13,145	2,855
Depreciation and amortization	68,969	66,182	139,205	132,202
Impairment losses on Loans to the Jamul Tribe	5,635		5,635
Total operating expenses	661,474	620,085	1,297,411	1,236,005
Income from operations	134,989	149,337	275,276	289,868
Other income (expenses)
Interest expense	(116,768)	(114,687)	(231,764)	(231,199)
Interest income	235	6,597	2,881	11,837
Income from unconsolidated affiliates	5,021	3,548	9,569	8,157
Loss on early extinguishment of debt			(23,390)
Other	(173)	44	(1,966)	(2,382)
Total other expenses	(111,685)	(104,498)	(244,670)	(213,587)
Income from operations before income taxes	23,304	44,839	30,606	76,281
Income tax provision	6,225	10,804	8,423	18,538
Net income	$ 17,079	$ 34,035	$ 22,183	$ 57,743
Earnings per common share:
Basic earnings per common share (in dollars per share)	$ 0.19	$ 0.38	$ 0.24	$ 0.64
Diluted earnings per common share (in dollars per share)	$ 0.18	$ 0.37	$ 0.24	$ 0.63

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Condensed Consolidated Statements of Comprehensive Income
Net income	$ 17,079	$ 34,035	$ 22,183	$ 57,743
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment during the period	1,217	(40)	1,654	1,272
Other comprehensive income (loss)	1,217	(40)	1,654	1,272
Comprehensive income	$ 18,296	$ 33,995	$ 23,837	$ 59,015

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, 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' Deficit
Share-based compensation arrangements, net of tax benefits of $4,375 for the period ended June 30, 2016		$ 7		12,097			12,104
Share-based compensation arrangements (in shares)		730,483
Foreign currency translation adjustment						1,272	1,272
Conversion of preferred stock		$ 12		(12)
Conversion of preferred stock (in shares)	(1,177)	1,177,000
Net income					57,743		57,743
Balance at Jun. 30, 2016		$ 849	(28,414)	1,000,771	(1,576,848)	(3,282)	(606,924)
Balance (in shares) at Jun. 30, 2016	7,447	82,796,758
Balance at Dec. 31, 2016		$ 932	(28,414)	1,014,119	(1,525,281)	(4,676)	(543,320)
Balance (in shares) at Dec. 31, 2016		91,122,308
Increase (Decrease) in Shareholders' Deficit
Repurchase of Preferred Stock		$ (4)		(5,790)			(5,794)
Repurchase of Preferred Stock (in shares)		(416,886)
Share-based compensation arrangements, net of tax benefits of $4,375 for the period ended June 30, 2016		$ 6		7,746			7,752
Share-based compensation arrangements (in shares)		634,245
Foreign currency translation adjustment						1,654	1,654
Net income					22,183		22,183
Balance at Jun. 30, 2017		$ 934	$ (28,414)	$ 1,016,075	$ (1,503,098)	$ (3,022)	$ (517,525)
Balance (in shares) at Jun. 30, 2017		91,339,667

Condensed Consolidated Statements of Changes in Shareholders' Deficit (Parenthetical) $ in Thousands	6 Months Ended
	Jun. 30, 2016 USD ($)
Condensed Consolidated Statements of Changes in Shareholders' Deficit
Share-based compensation arrangements, tax benefit	$ 4,375

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Operating activities
Net income	$ 22,183	$ 57,743
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	139,205	132,202
Amortization of items charged to interest expense and interest income	3,275	3,701
Change in fair value of contingent purchase price	3,922	(1,081)
Loss (gain) on sale of property and equipment and assets held for sale	7	(660)
Income from unconsolidated affiliates	(9,569)	(8,157)
Distributions from unconsolidated affiliates	13,000	13,350
Deferred income taxes	2,087	3,540
Charge for stock-based compensation	3,974	3,037
Impairment losses on Loans to the Jamul Tribe	5,635
Write off of debt issuance costs and discounts	5,377
Decrease (increase), net of businesses acquired
Accounts receivable	7,378	(1,800)
Prepaid expenses and other current assets	(4,829)	(6,855)
Other assets	(2,876)	(321)
(Decrease) increase, net of businesses acquired
Accounts payable	(3,929)	(6,025)
Accrued expenses	8,895	7,231
Accrued interest	6,751	(1,386)
Accrued salaries and wages	(9,177)	(17,927)
Gaming, pari-mutuel, property and other taxes	(3,997)	(7,601)
Income taxes	14,657	27,340
Other current and noncurrent liabilities	(6,063)	(2,293)
Net cash provided by operating activities	195,906	194,038
Investing activities
Project capital expenditures	(14,673)	(10,991)
Maintenance capital expenditures	(28,287)	(32,543)
Proceeds for insurance claim	577
Loans to the Jamul Tribe	(372)	(102,220)
Principal and interest receipts applied against Loans to the Jamul Tribe	2,720
Proceeds from sale of property and equipment and assets held for sale	477	2,272
Consideration paid for acquisitions of businesses and other property and equipment, net of cash acquired	(126,653)	(280)
Net cash used in investing activities	(166,211)	(143,762)
Financing activities
Proceeds from exercise of options	3,721	4,609
Repurchase of common stock	(5,794)
Principal payments on financing obligation with GLPI	(29,328)	(25,598)
Proceeds from issuance of long-term debt, net of issuance costs	1,370,797	24,204
Increase to financing obligation in connection with acquisition	82,603
Principal payments on long-term debt	(1,429,161)	(63,815)
Payments of other long-term obligations	(28,189)	(6,899)
Payments of contingent purchase price	(41)
Proceeds from insurance financing	8,768	9,524
Payments on insurance financing	(8,182)	(7,950)
Net cash used in financing activities	(34,806)	(65,925)
Net decrease in cash and cash equivalents	(5,111)	(15,649)
Cash and cash equivalents at beginning of year	229,510	237,009
Cash and cash equivalents at end of year	224,399	221,360
Supplemental disclosure
Interest expense paid, net of amounts capitalized	222,641	229,979
Income tax refunds received	(5,659)	(12,133)
Non-cash investing and financing activities
Accrued capital expenditures	9,595	8,898
Accrued advances to Jamul Tribe	$ 1,274	$ 38,775

Organization and Basis of Presentation	6 Months Ended
Organization and Basis of Presentation	Jun. 30, 2017
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 expanded into social online gaming offerings via our Penn Interactive Ventures, LLC (“Penn Interactive Ventures”) division and our acquisition of Rocket Speed, Inc. (“Rocket Speed”) and into retail gaming with our Prairie State Gaming subsidiary. On May 1, 2017, we completed our acquisition of Bally’s Casino Tunica (“Bally’s”) and Resorts Casino Tunica (“Resorts”). In the first half of 2017, our subsidiary, Prairie State Gaming acquired the assets of two small video gaming terminal operators in Illinois. As of June 30, 2017, the Company owned, managed, or had ownership interests in twenty-nine facilities in the following seventeen jurisdictions: California, 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 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 six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The notes to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2016 should be read in conjunction with these condensed consolidated financial statements. The December 31, 2016 financial information has been derived from the Company’s audited consolidated financial statements.

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2017

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 against 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 (“OTWs’).

Revenue from our management service contracts for Casino Rama and Hollywood Casino Jamul – San Diego are based upon contracted terms and are recognized when services are performed and collection is reasonably assured.

The Company records revenues generated from its management service contract and licensing contract with the Jamul Indian Village of California (the “Jamul Tribe”) in accordance with ASC 605-25 “Multiple Element Arrangements.” The fair value of each arrangement element is based on the separate standalone selling price determined by either vendor-specific objective evidence (“VSOE”), if available, or third-party evidence ("TPE") if VSOE is not available. We concluded revenues generated with respect to each element contained within the arrangement is representative of the separate standalone selling price which is reflective of fair value.

Revenues include reimbursable costs associated with the Company’s management contract with 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 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 six months ended June 30, 2017 and 2016 are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	10,298	$	10,098	$	19,493	$	19,220
Food and beverage		33,386		31,796		63,953		61,318
Other		2,299		2,219		4,395		4,146
Total promotional allowances	$	45,983	$	44,113	$	87,841	$	84,684

The estimated cost of providing such complimentary services for the three and six months ended June 30, 2017 and 2016 are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	1,480	$	1,349	$	2,736	$	2,546
Food and beverage		13,009		12,194		24,629		23,718
Other		972		911		1,811		1,655
Total cost of complimentary services	$	15,461	$	14,454	$	29,176	$	27,919

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. For the three and six months ended June 30, 2017, these expenses, which are recorded primarily within gaming expense in the condensed consolidated statements of income, were $252.5 million and $498.9 million, as compared to $248.8 million and $494.5 million for the three and six months ended June 30, 2016.

Long-term asset related to the Jamul Tribe

The Company is accounting for its term loan C and related $15 million delayed draw commitments with the Jamul Tribe as a loans (the “Loan”) in accordance with ASC 310, “Receivables.” The Loan represents advances made by the Company to the Jamul Tribe for the development and construction of Hollywood Casino Jamul-San Diego for the Jamul Tribe on reservation land. As such, the Jamul Tribe owns the casino and its related assets and liabilities. Repayment of the Loan is primarily predicated on cash flows from the operations of the facility.

Although Hollywood Casino Jamul San-Diego opened to strong business and earnings volumes in October 2016, which met our expectations, results began to soften earlier and with a steeper dropoff than anticipated. As a result, we concluded the Loan was impaired at December 31, 2016. A loan is considered impaired when, based on current information, events and projections, it is probable that the Company will be unable to collect the scheduled payments of principal and/or interest when contractually due under the terms of the loan agreement. An impairment charge is recorded to the extent the present value of expected future cash flows discounted at the loan’s effective interest rate exceeds the carrying amount of the loan. The Company records interest income on a cash basis to the extent a reserve is not required for the impaired loan.

As of June 30, 2017, the Jamul Tribe will be in breach of a financial covenant requirement with respect to debt to earnings ratios. As a result, the Jamul Tribe is in active negotiations with its lenders to modify certain terms of its loan agreements. We anticipate that we may grant certain concessions on our Loan in connection with the negotiations. We also anticipate our Loan will be fully subordinated to the other lenders that have extended credit to the Jamul Tribe.

The Company performed a comprehensive analysis of the future cash flows that we will receive on the Loan based upon our best estimates of the operations of the facility and the concessions we may be required to grant to the Jamul Tribe. The expected cash flows to be received by the Company on the Loan were then discounted at the Loan’s effective interest rate in accordance with ASC 310 which was less than its carrying value at June 30, 2017. Therefore, the Company recorded a charge to establish a reserve of $5.6 million in the condensed consolidated statement of income for the three and six months ended June 30, 2017. If the concessions granted on our Loan are more severe than anticipated or if the Jamul Tribe and its Lenders are not able to reach an agreement, additional charges may be required, which could be material to the Company’s condensed consolidated statement of income. The unpaid principal balance of the Loan at June 30, 2017 and December 31, 2016 was $98.1 million and $98.0 million, respectively. The carrying value of the Loan totaled $84.2 million and $92.1 million at June 30, 2017 and December 31, 2016, respectively.

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.

As of June 30, 2017, there were no outstanding shares of Series C Preferred Stock. At June 30, 2016, the Company had outstanding 7,447 shares of Series C Convertible Preferred Stock. 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 six months ended June 30, 2017 and 2016 under the two-class method:


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)				(in thousands)

Net income	$	17,079	$	34,035	$	22,183	$	57,743
Net income applicable to preferred stock		—		3,151		—		5,452
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291

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 six months ended June 30, 2017 and 2016:


	Three Months Ended June 30,	Three Months Ended June 30,	Six Months Ended June 30,	Six Months Ended June 30,
	2017	2016	2017	2016
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	90,928	81,647	90,840	81,308
Assumed conversion of dilutive employee stock-based awards	2,230	1,474	1,629	1,459
Assumed conversion of restricted stock	81	34	74	42
Diluted weighted-average common shares outstanding before participating security	93,239	83,155	92,543	82,809
Assumed conversion of preferred stock	—	8,331	—	8,478
Diluted weighted-average common shares outstanding	93,239	91,486	92,543	91,287

Options to purchase 55,062 and 1,598,500 shares and 1,696,858 and 2,889,501 shares were outstanding during the three and six months ended June 30, 2017 and 2016, 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 six months ended June 30, 2017 and 2016 (in thousands, except per share data):


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
Calculation of basic EPS:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Weighted-average common shares outstanding		90,928		81,647		90,840		81,308
Basic EPS	$	0.19	$	0.38	$	0.24	$	0.64

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Diluted weighted-average common shares outstanding before participating security		93,239		83,155		92,543		82,809
Diluted EPS	$	0.18	$	0.37	$	0.24	$	0.63

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 is 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 5.30 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 1,475,224 and 1,561,035 stock options during the six months ended June 30, 2017 and 2016, respectively.

Stock-based compensation expense for the three and six months ended June 30, 2017 was $1.8 million and $4.0 million as compared to $1.6 million and $3.1 million for the three and six months ended June 30, 2016, 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 $10.5 million and $5.6 million at June 30, 2017 and December 31, 2016, respectively. For PSUs held by Penn employees, there was $6.7 million of total unrecognized compensation cost at June 30, 2017 that will be recognized over the grants remaining weighted average vesting period of 2.44 years. For the three and six months ended June 30, 2017, the Company recognized $4.6 million and $8.9 million of compensation expense associated with these awards, as compared to $0.6 million and $3.6 million for the three and six months ended June 30, 2016. The changes are primarily due to the increase in Penn’s stock price year-over-year. Amounts paid by the Company for the three and six months ended June 30, 2017 on these cash-settled awards totaled $0.1 million and $3.6 million as compared to $0.1 million and $4.5 million for the three and six months ended June 30, 2016.

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 $13.7 million and $7.3 million at June 30, 2017 and December 31, 2016, respectively. For SARs held by Penn employees, there was $12.8 million of total unrecognized compensation cost at June 30, 2017 that will be recognized over the awards remaining weighted average vesting period of 2.82 years. For the three and six months ended June 30, 2017, the Company recognized compensation expense of $4.6 million and $8.6 million associated with these awards, as compared to a credit of $0.5 million and compensation expense of $1.4 million for the three and six months ended June 30, 2016. The changes are primarily due to the increase in Penn’s stock price year-over-year. Amounts paid by the Company for the three and six months ended June 30, 2017 on these cash-settled awards totaled $1.5 million and $2.6 million as compared to $1.1 million and $1.5 million for the three and six months ended June 30, 2016.

The following are the weighted-average assumptions used in the Black-Scholes option-pricing model for stock option awards granted during the June 30, 2017 and 2016, respectively:



Six months ended June 30,	2017		2016
Risk-free interest rate	1.97	%	1.20	%
Expected volatility	30.67	%	31.22	%
Dividend yield	—		—
Weighted-average expected life (years)	5.30		5.40

Segment Information

The Company’s Chief Executive Officer, 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.

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. 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, Tropicana Las Vegas, Bally’s Casino Tunica and Resorts Casino Tunica, which were acquired on May 1, 2017, as well as our management contract with Hollywood Casino Jamul-San Diego, 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, 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, the Other category includes Penn Interactive Ventures, the Company’s wholly-owned subsidiary that represents its social online gaming initiatives, including Rocket Speed. Penn Interactive Ventures meets the definition of an operating segment under ASC 280, but is quantitatively not significant to the Company’s operations as it represents 1.4% of net revenues and $(2.3) million impact to income from operations for the six months ended June 30, 2017, and its total assets represent 2.2% of the Company’s total assets at June 30, 2017.

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 and financing charges, impairment charges, insurance recoveries and deductible charges, depreciation and amortization, changes in the estimated fair value of our contingent purchase price obligations, 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 9 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 six months ended June 30, 2017 and 2016, the only component of accumulated other comprehensive income was foreign currency translation adjustments.

New Accounting Pronouncements

6 Months Ended

Jun. 30, 2017

New Accounting Pronouncements

New Accounting Pronouncements

3. New Accounting Pronouncements

Accounting Pronouncements Implemented in 2017

In March 2016, the FASB issued ASU No. 2016-09, “Compensation - Stock Compensation (Topic 718) – Improvements to Employee Share-Based Payment Accounting.” 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. The Company adopted this change in accounting principle effective January 1, 2017. As a result of adopting the change to accounting for income taxes, for the six months ended June 30, 2017, the Company recognized an income tax benefit of $1.9 million related to excess tax deductions that would have previously been recognized as additional paid in capital within Shareholders Deficit. The Company did not record a cumulative effect adjustment to Retained Earnings due to having a full valuation allowance against all deferred tax assets. Deferred tax assets and the valuation allowance increased by $16.4 million at January 1, 2017 for the tax effect previously unrecognized for excess tax deductions. The Company has elected to present the change in classification of excess /(deficient) tax deductions from a financing activity to an operating activity within its consolidated statement of cash flows on a retrospective basis. The impact to the comparative period ended June 30, 2016 was an increase to net cash provided by operating activities and an increase in cash used in financing activities of $4.4 million, respectively. The Company has also made an accounting policy election to account for forfeitures when they occur which had no cumulative effect to retained earnings. Finally, effective January 1, 2017, the Company adopted the change related to diluted EPS on a prospective basis such that the net benefit/ (deficiency) attributable to taxes is no longer included in the computation of assumed proceeds.

New Accounting Pronouncements to be Implemented

In May 2017, the FASB issued ASU No. 2017-09, “Compensation – Stock Compensation (Topic 718) – Scope of Modification Accounting.” The amendments are intended to provide clarity and reduce both the diversity in practice and cost and complexity when applying the guidance in Topic 718, Compensation – Stock Compensation, to a change to the terms or conditions of a share-based payment award. An entity should account for the effects of a modification unless all the following are met: (1) the fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the modified award is the same as the fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification; (2) The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and (3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. The amendment is effective for all entities for annual periods, and interim periods within those periods, beginning after December 15, 2017, with early adoption permitted. The Company will adopt this standard next year and does not believe the prospective amendments of this standard will have a material impact on the financial statements.

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, the following areas that are expected to result in changes to our accounting are:

(1)

The accounting for loyalty points which are earned by our customers. The Company’s Marquee Rewards program allows members to 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 the Company’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.

(2)

The new standard will also require us to allocate the revenues associated with players’ activity between gaming revenue and the value of the points and to measure the liability based on the estimated standalone selling price of the points earned after factoring in the likelihood of redemption. As a result, we expect that gaming revenues will be reduced and that promotional allowance will no longer be netted on our statement of income. The revenue associated with the points earned will be recognized in the period in which they are redeemed.

(3)

Further, we believe the reimbursable costs associated with our management service contract for Casino Rama, which are primarily payroll costs, will need to be recognized as revenue on a gross basis, with an offsetting amount charged to reimbursable management costs within operating expenses as we are the controlling entity to the arrangement. For the six months ended June 30, 2017 and twelve months ended December 31, 2016 and 2015, these reimbursable costs were $42.8 million, $83.6 million and $81.3 million, respectively.

Additionally, at this time, we expect to adopt Topic 606 using the modified retrospective method on January 1, 2018. The Company is continuing to evaluate the new guidance both internally and through following the industry working group and plans to provide additional information at a future date.

- 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
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6507316

Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Property and Equipment

6 Months Ended

Jun. 30, 2017

Property and Equipment

Property and Equipment

4. Property and Equipment

Property and equipment, net, consists of the following:


	June 30,		December 31,
	2017		2016
	(in thousands)

Property and equipment - non-master lease
Land and improvements	$	294,535	$	294,590
Building and improvements		405,024		404,158
Furniture, fixtures and equipment		1,374,884		1,355,615
Leasehold improvements		119,730		118,940
Construction in progress		38,619		16,375
		2,232,792		2,189,678
Less Accumulated depreciation		(1,296,962)		(1,224,596)
		935,830		965,082
Property and equipment - master lease
Land and improvements		435,043		382,246
Building and improvements		2,248,257		2,219,018
		2,683,300		2,601,264
Less accumulated depreciation		(791,413)		(745,963)
		1,891,887		1,855,301
Property and equipment, net	$	2,827,717	$	2,820,383

Property and equipment, net increased by $7.3 million for the six months ended June 30, 2017 primarily due to the addition of Bally’s and Resorts in Tunica as well as improvements at Tropicana Las Vegas and Hollywood Casino St. Louis. This net increase is partially offset by depreciation expense for the six months ended June 30, 2017.

Depreciation expense, for property and equipment including assets under capital leases, totaled $63.7 million and $128.7 million and $65.7 million and $131.3 million for the three and six months ended June 30, 2017 and 2016, respectively, of which $23.0 million and $45.7 million and $22.8 million and $45.7 million related to assets under the Master Lease, respectively. Interest capitalized in connection with major construction projects totaled $0.1 million for the three and six months ended June 30, 2017 as compared to zero for the three and six months ended June 30, 2016.

Acquisitions

6 Months Ended

Jun. 30, 2017

Acquisitions

Acquisitions

5. Acquisitions

Bally’s and Resorts

On May 1, 2017, the Company acquired RIH Acquisitions MS I, LLC and RIH Acquisitions MS II, LLC, the holding companies for the gaming operations of Bally’s and Resorts, in Tunica, Mississippi, for consideration of $45.9 million in cash, subject to final working capital adjustments. The Company is operating both of these casino properties and it leases the underlying real estate associated with these two businesses from GLPI with a total initial annual payment of $9.0 million subject to the provisions included in the terms of the Master Lease. The underlying real estate leased from GLPI has been accounted for as a financing obligation, which is included in the total consideration for the transaction and has increased the Company’s Master Lease financing obligation by $82.6 million, which represents the purchase price GLPI paid for the underlying real estate assets.

The preliminary purchase price allocation has resulted in $35.5 million of goodwill which is deductible for tax purposes. Property and equipment under the Master Lease is comprised of buildings and improvements and land rights that are amortized on a straight-line basis over thirty-one years. This time period represents the remaining life of the Master Lease with GLPI, including renewal options that are reasonably assured of being exercised. Additionally, prior to the acquisition date, the Company incurred transaction costs of $0.7 million, which were reported in general and administrative expenses for the three and six months ended June 30, 2017. This acquisition was not material to the Company’s consolidated financial statements.


		May 1, 2017

Cash		$ 6,725
Other current assets		2,847
Property and equipment - non-master lease		8,368
Property and equipment - master lease		82,603
Goodwill		35,534
Other intangible assets		851
Total Assets		$ 136,928

Current portion of financing obligation		$ 1,968
Accrued expenses		3,716
Accrued salaries and wages		3,256
Other current liabilities		1,448
Long-term financing obligation		80,635
Total liabilities		$ 91,023
Cash paid		45,905
Total consideration transferred		$ 136,928

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

Intangible Assets

6 Months Ended

Jun. 30, 2017

Intangible Assets

Intangible Assets

6. Intangible Assets

Indefinite‑life intangible assets consist primarily of gaming licenses. The table below presents the gross carrying value, accumulated amortization, and net book value of each major class of other intangible assets at June 30, 2017 and December 31, 2016:


	June 30, 2017						December 31, 2016
	(in thousands)
	Gross						Gross
	Carrying		Accumulated		Net Book		Carrying		Accumulated		Net Book
	Value		Amortization		Value		Value		Amortization		Value
Indefinite-life intangible assets	$	375,405	$	—	$	375,405	$	375,405	$	—	$	375,405
Other intangible assets		130,852		75,925		54,927		125,584		65,495		60,089
Total	$	506,257	$	75,925	$	430,332	$	500,989	$	65,495	$	435,494

Total other intangible assets decreased by $5.2 million for the six months ended June 30, 2017 primarily due to amortization expense of $10.5 million for the six months ended June 30, 2017, partially offset by $3.7 million and $0.9 million of definite-lived other intangible assets related to customer intangibles from our acquisitions of Illinois video gaming terminal operators and Bally’s and Resorts, respectively, in 2017. Other intangible assets have a weighted average remaining amortization period of 5.5 years.

The Company’s intangible asset amortization expense was $5.3 million and $10.5 million, for the three and six months ended June 30, 2017, respectively, as compared to $0.5 million and $1.0 million for the three and six months ended June 30, 2016, respectively. The increase is primarily due to the intangible assets recognized with our acquisition of Rocket Speed on August 1, 2016.

The following table presents expected intangible asset amortization expense based on existing intangible assets as of June 30, 2017 (in thousands):


Remaining 2017	$	8,241
2018		12,885
2019		8,418
2020		5,854
2021		3,705
Thereafter		15,824
Total	$	54,927

Long-term Debt

6 Months Ended

Jun. 30, 2017

Long-term Debt

Long-term Debt

7. Long-term Debt

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


	June 30,		December 31,
	2017		2016
	(in thousands)

Senior secured credit facility	$	845,000	$	976,845
$300 million 5.875 % senior subordinated notes due November 1, 2021		—		300,000
$400 million 5.625 % senior unsecured notes due January 15, 2027		400,000		—
Other long-term obligations		126,573		154,084
Capital leases		879		1,760
		1,372,452		1,432,689
Less current maturities of long-term debt		(35,675)		(85,595)
Less net discounts		(2,862)		(620)
Less debt issuance costs		(30,892)		(16,535)
	$	1,303,023	$	1,329,939

The following is a schedule of future minimum repayments of long-term debt as of June 30, 2017 (in thousands):


Within one year	$	35,638
1-3 years		82,300
3-5 years		334,017
Over 5 years		920,497
Total minimum payments	$	1,372,452

Senior Secured Credit Facility

On January 19, 2017, the Company entered into a new senior secured credit facility. The new senior secured credit facility consists of a five year $700 million revolver, a five year $300 million Term Loan A facility, and a seven year $500 million Term Loan B facility (the “Amended Credit Facilities”). The Term Loan A facility was priced at LIBOR plus a spread (ranging from 3.00% to 1.25%) based on the Company’s consolidated total net leverage ratio as defined in the new senior secured credit facility. The Term Loan B facility was priced at LIBOR plus 2.50%, with a 0.75% LIBOR floor. At June 30, 2017, the Company’s senior secured credit facility had a gross outstanding balance of $845.0 million, consisting of a $296.2 million Term Loan A facility, a $498.8 million Term Loan B facility, and $50.0 million outstanding on the revolving credit facility. Additionally, at June 30, 2017, the Company had conditional obligations under letters of credit issued pursuant to the senior secured credit facility with face amounts aggregating $22.1 million, resulting in $627.9 million of available borrowing capacity as of June 30, 2017 under the revolving credit facility. In connection with the repayment of the previous senior secured credit facility, the Company recorded $1.7 million in refinancing costs and a $2.3 million loss on the early extinguishment of debt for the six months ended June 30, 2017 related to the write-off of deferred debt issuance costs and the discount on the Term Loan B facility of the previous senior secured credit facility.

Redemption of 5.875% Senior Subordinated Notes

In the first quarter of 2017, the Company redeemed all of its $300 million 5.875% senior subordinated notes, which were due in 2021 (“5.875% Notes”). In connection with this redemption, the Company recorded a $21.1 million loss on the early extinguishment of debt for the six months ended June 30, 2017 related to the difference between the reacquisition price of the 5.875% Notes compared to its carrying value.

5.625% Senior Unsecured Notes

On January 19, 2017, the Company completed an offering of $400 million 5.625% senior unsecured notes that mature on January 15, 2027 (the “5.625% Notes”) at a price of par. Interest on the 5.625% Notes is payable on January 15th and July 15th of each year. The 5.625% Notes are senior unsecured obligations of the Company. The 5.625% Notes will not be guaranteed by any of the Company’s subsidiaries except in the event that the Company in the future issues certain subsidiary‑guaranteed debt securities. The Company may redeem the 5.625% Notes at any time on or after January 15, 2022, at the declining redemption premiums set forth in the indenture governing the 5.625% Notes, and, prior to January 15, 2022, at a “make-whole” redemption premium set forth in the indenture governing the 5.625% Notes. In addition, prior to January 15, 2020, the Company may redeem the 5.625% Notes with an amount equal to the net proceeds from one or more equity offerings, at a redemption price equal to 105.625% of the principal amount of the 5.625% Notes redeemed, together with accrued and unpaid interest to, but not including, the redemption date, so long as at least 60% of the aggregate principal amount of the notes originally issued under the indenture remains outstanding and such redemption occurs within 180 days of closing of the related equity offering.

The Company used a portion of the proceeds from the issuance of the 5.625% Notes to retire its existing 5.875% Notes and to fund related transaction fees and expenses.

The Company used loans funded under the Amended Credit Facilities and a portion of the proceeds of the 5.625% Notes to repay amounts outstanding under its then existing Credit Agreement and to fund related transaction fees and expenses and for general corporate purposes.

Covenants

The Company’s senior secured credit facility and $400 million 5.625% 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 $400 million 5.625% 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 June 30, 2017, the Company was in compliance with all required financial covenants.

Corporate Airplane Loan

In January 2017, the Company’s corporate airplane loan of $20.8 million was paid in full. At December 31, 2016 the corporate airplane loan was included with other long-term obligations.

Master Lease Financing Obligation	6 Months Ended
Master Lease Financing Obligation	Jun. 30, 2017
Master Lease Financing Obligation
Master Lease Financing Obligation	8. 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 spin-off of GLPI based on the future minimum lease payments due to GLPI under the Master Lease discounted at 9.70%, which represented 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. As of May 1, 2017, in connection with the acquisition of Bally’s and Resorts (see Note 5 for more information), the Company’s Master Lease financing obligation was increased by $82.6 million which was the purchase price paid by GLPI for the casinos underlying real estate assets. Total payments under the Master Lease were $114.0 million and $226.4 as compared to $110.8 million and $222.2 million for the three and six months ended June 30, 2017 and 2016, respectively. The interest expense recognized for the three and six months ended June 30, 2017 was $99.4 million and $197.1 million as compared to $97.8 million and $196.5 million for the three and six months ended June 30, 2016, respectively.

Segment Information

6 Months Ended

Jun. 30, 2017

Segment Information

Segment Information

9. Segment Information

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 June 30, 2017	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	108,119	$	20,062	$	59,283	$	(52,475)	$	134,989
Charge for stock compensation		—		—		—		1,801		1,801
Depreciation and amortization		21,525		9,353		9,508		28,583		68,969
Contingent purchase price		277		—		16		1,069		1,362
(Gain) loss on disposal of assets		(45)		(1)		88		10		52
Impairment losses on Loans to the Jamul Tribe		—		5,635		—		—		5,635
Income (loss) from unconsolidated affiliates		—		—		5,286		(265)		5,021
Non-operating items for Kansas JV		—		—		1,309		—		1,309
Adjusted EBITDA	$	129,876	$	35,049	$	75,490	$	(21,277)	$	219,138

Three months ended June 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	103,695	$	27,622	$	57,446	$	(39,426)	$	149,337
Charge for stock compensation		—		—		—		1,582		1,582
Depreciation and amortization		23,209		8,839		9,460		24,674		66,182
Contingent purchase price		119		—		—		—		119
Loss on disposal of assets		(14)		11		(52)		496		441
Income (loss) from unconsolidated affiliates		—		—		3,744		(196)		3,548
Non-operating items for Kansas JV		—		—		2,571		—		2,571
Adjusted EBITDA	$	127,009	$	36,472	$	73,169	$	(12,870)	$	223,780


Six months ended June 30, 2017	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	210,752	$	47,180	$	120,813	$	(103,469)	$	275,276
Charge for stock compensation		—		—		—		3,974		3,974
Depreciation and amortization		44,548		18,570		19,179		56,908		139,205
Contingent purchase price		1,182		—		25		2,715		3,922
(Gain) loss on disposal of assets		(31)		5		29		4		7
Impairment losses on Loans to the Jamul Tribe		—		5,635		—		—		5,635
Income (loss) from unconsolidated affiliates		—		—		10,290		(721)		9,569
Non-operating items for Kansas JV		—		—		3,260		—		3,260
Adjusted EBITDA	$	256,451	$	71,390	$	153,596	$	(40,589)	$	440,848

Six months ended June 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	204,616	$	53,607	$	115,670	$	(84,025)	$	289,868
Charge for stock compensation		—		—		—		3,037		3,037
Depreciation and amortization		46,202		17,604		19,028		49,368		132,202
Contingent purchase price		(1,081)		—		—		—		(1,081)
Loss on disposal of assets		7		(14)		(45)		(608)		(660)
Income (loss) from unconsolidated affiliates		—		—		8,462		(305)		8,157
Non-operating items for Kansas JV		—		—		5,141		—		5,141
Adjusted EBITDA	$	249,744	$	71,197	$	148,256	$	(32,533)	$	436,664


		Northeast		South/West		Midwest		Other (1)		Total
	(in thousands)
Three months ended June 30, 2017
Net revenues	$	405,099	$	153,151	$	224,847	$	13,366	$	796,463
Capital expenditures		5,533		11,924		7,345		1,002		25,804

Three months ended June 30, 2016
Net revenues	$	401,516	$	140,108	$	220,256	$	7,542	$	769,422
Capital expenditures		8,268		6,726		6,348		823		22,165

Six months ended June 30, 2017
Net revenues	$	798,564	$	292,970	$	453,185	$	27,968	$	1,572,687
Capital expenditures		9,523		20,546		11,676		1,215		42,960

Six months ended June 30, 2016
Net revenues	$	794,722	$	276,076	$	441,334	$	13,741	$	1,525,873
Capital expenditures		15,387		14,311		12,330		1,506		43,534

Balance sheet at June 30, 2017
Total assets	$	808,144	$	876,910	$	1,081,316	$	2,217,649	$	4,984,019
Investment in and advances to unconsolidated affiliates		76		—		91,058		61,779		152,913
Goodwill and other intangible assets, net		324,285		260,978		778,056		92,900		1,456,219

Balance sheet at December 31, 2016
Total assets	$	861,951	$	840,076	$	1,103,231	$	2,169,226	$	4,974,484
Investment in and advances to unconsolidated affiliates		76		—		93,768		62,332		156,176
Goodwill and other intangible assets, net		324,285		224,719		775,377		100,798		1,425,179

(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 on July 31, 2016, Sanford Orlando Kennel Club and the Company’s Texas and New Jersey joint ventures, which do not have gaming operations. Other also includes Penn Interactive Ventures, which is a wholly-owned subsidiary that is pursuing our interactive gaming strategy and our recent acquisition of Rocket Speed.

- 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
-SubTopic 10
-Section 50
-Paragraph 33
-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
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 12
-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
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 1
-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
-SubTopic 10
-Section 50
-Paragraph 32
-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
-SubTopic 10
-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
-SubTopic 10
-Section 50
-Paragraph 35
-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
-SubTopic 10
-Section 50
-Paragraph 40
-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
-Paragraph 10
-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
-SubTopic 10
-Section 50
-Paragraph 29
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8864-108599

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-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
-SubTopic 10
-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599

+ Details

Fair Value Measurements

6 Months Ended

Jun. 30, 2017

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 and as such is a Level 1 measurement.

Loans to the Jamul Tribe

The fair value of the Company’s loans to the Jamul Tribe was based on market interest rates for similarly rated observable instruments. Although we determined that these inputs fell within Level 2 of the fair value hierarchy, the Company’s loan is impaired and as such the fair value is estimated based on the present value of expected future cash flows of the facility discounted at the loan’s effective interest rate which is a Level 3 measurement. Therefore, the Company concluded that this instrument should be classified as a Level 3 measurement. See Note 2 for further details.

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 June 30, 2017, 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.

Other liabilities

Other liabilities at June 30, 2017 is primarily comprised of the contingent purchase price consideration related to the purchases of Plainridge Racecourse and Rocket Speed. 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 Speed 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 charge to general and administrative expense of $1.4 million and $3.9 million for the three and six months ended June 30, 2017, respectively, compared to a charge of $0.1 million and a reduction of $1.1 million for the three and six months ended June 30, 2016, respectively.

The carrying amounts and estimated fair values by input level of the Company’s financial instruments at June 30, 2017 and December 31, 2016 are as follows (in thousands):


	June 30, 2017
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	224,399	$	224,399	$	224,399	$	—	$	—
Loans to the Jamul Tribe		84,152		84,152		—		—		84,152
Financial liabilities:
Long-term debt
Senior secured credit facility		812,001		847,494		797,494		50,000		—
Senior unsecured notes		399,208		406,000		406,000		—		—
Other long-term obligations		126,573		127,301		—		127,301		—
Other liabilities		52,955		52,955		—		—		52,955


	December 31, 2016
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	229,510	$	229,510	$	229,510	$	—	$	—
Loans to the Jamul Tribe		92,100		98,000		—		—		98,000
Financial liabilities:
Long-term debt
Senior secured credit facility		962,703		976,092		785,092		191,000		—
Senior unsecured notes		296,895		312,000		312,000		—		—
Other long-term obligations		154,084		152,132		—		152,132		—
Other liabilities		48,244		48,244		—		—		48,244

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


	Six Months Ended
	June 30, 2017
	Liabilities			Assets
	Contingent			Loans to the
	Purchase Price			Jamul Tribe
Balance at January 1, 2017	$	48,244	$	98,000
Unamortized discount		—		(5,865)
Additions		830		372
Payments		(41)		(2,720)
Included in earnings		3,922		(5,635)
Balance at June 30, 2017	$	52,955	$	84,152

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 Speed	Option pricing method	Discount rate, Volatility rate	11.00	%	70.92	%

Investment In Unconsolidated Affiliates

6 Months Ended

Jun. 30, 2017

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, 41 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, 2016 (and expected for the year ending December 31, 2017), 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 June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Net revenues	$	38,924	$	37,872	$	77,770	$	77,754
Operating expenses		28,352		30,384		57,190		60,829
Income from operations		10,572		7,488		20,580		16,925
Net income	$	10,572	$	7,488	$	20,580	$	16,925

Net income attributable to Penn	$	5,286	$	3,744	$	10,290	$	8,462

Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2017

Summary of Significant Accounting Policies

Revenue Recognition and Promotional Allowances

The amounts included in promotional allowances for the three and six months ended June 30, 2017 and 2016 are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	10,298	$	10,098	$	19,493	$	19,220
Food and beverage		33,386		31,796		63,953		61,318
Other		2,299		2,219		4,395		4,146
Total promotional allowances	$	45,983	$	44,113	$	87,841	$	84,684

The estimated cost of providing such complimentary services for the three and six months ended June 30, 2017 and 2016 are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	1,480	$	1,349	$	2,736	$	2,546
Food and beverage		13,009		12,194		24,629		23,718
Other		972		911		1,811		1,655
Total cost of complimentary services	$	15,461	$	14,454	$	29,176	$	27,919

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 six months ended June 30, 2017 and 2016 under the two-class method:


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)				(in thousands)

Net income	$	17,079	$	34,035	$	22,183	$	57,743
Net income applicable to preferred stock		—		3,151		—		5,452
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291


	Three Months Ended June 30,	Three Months Ended June 30,	Six Months Ended June 30,	Six Months Ended June 30,
	2017	2016	2017	2016
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	90,928	81,647	90,840	81,308
Assumed conversion of dilutive employee stock-based awards	2,230	1,474	1,629	1,459
Assumed conversion of restricted stock	81	34	74	42
Diluted weighted-average common shares outstanding before participating security	93,239	83,155	92,543	82,809
Assumed conversion of preferred stock	—	8,331	—	8,478
Diluted weighted-average common shares outstanding	93,239	91,486	92,543	91,287

The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the three and six months ended June 30, 2017 and 2016 (in thousands, except per share data):


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
Calculation of basic EPS:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Weighted-average common shares outstanding		90,928		81,647		90,840		81,308
Basic EPS	$	0.19	$	0.38	$	0.24	$	0.64

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Diluted weighted-average common shares outstanding before participating security		93,239		83,155		92,543		82,809
Diluted EPS	$	0.18	$	0.37	$	0.24	$	0.63

Stock-Based Compensation

The following are the weighted-average assumptions used in the Black-Scholes option-pricing model for stock option awards granted during the June 30, 2017 and 2016, respectively:



Six months ended June 30,	2017		2016
Risk-free interest rate	1.97	%	1.20	%
Expected volatility	30.67	%	31.22	%
Dividend yield	—		—
Weighted-average expected life (years)	5.30		5.40

Segment Information

See Note 9 for further information with respect to the Company’s segments.

Other Comprehensive Income

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2017

Summary of Significant Accounting Policies

Schedule of promotional allowances


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	10,298	$	10,098	$	19,493	$	19,220
Food and beverage		33,386		31,796		63,953		61,318
Other		2,299		2,219		4,395		4,146
Total promotional allowances	$	45,983	$	44,113	$	87,841	$	84,684

Schedule of estimated cost of providing complimentary services


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)
Rooms	$	1,480	$	1,349	$	2,736	$	2,546
Food and beverage		13,009		12,194		24,629		23,718
Other		972		911		1,811		1,655
Total cost of complimentary services	$	15,461	$	14,454	$	29,176	$	27,919

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


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
	(in thousands)				(in thousands)

Net income	$	17,079	$	34,035	$	22,183	$	57,743
Net income applicable to preferred stock		—		3,151		—		5,452
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291

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 June 30,	Three Months Ended June 30,	Six Months Ended June 30,	Six Months Ended June 30,
	2017	2016	2017	2016
	(in thousands)		(in thousands)
Determination of shares:
Weighted-average common shares outstanding	90,928	81,647	90,840	81,308
Assumed conversion of dilutive employee stock-based awards	2,230	1,474	1,629	1,459
Assumed conversion of restricted stock	81	34	74	42
Diluted weighted-average common shares outstanding before participating security	93,239	83,155	92,543	82,809
Assumed conversion of preferred stock	—	8,331	—	8,478
Diluted weighted-average common shares outstanding	93,239	91,486	92,543	91,287

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

The following table presents the calculation of basic and diluted EPS for the Company’s common stock for the three and six months ended June 30, 2017 and 2016 (in thousands, except per share data):


	Three Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,		Six Months Ended June 30,
	2017		2016		2017		2016
Calculation of basic EPS:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Weighted-average common shares outstanding		90,928		81,647		90,840		81,308
Basic EPS	$	0.19	$	0.38	$	0.24	$	0.64

Calculation of diluted EPS using two-class method:
Net income applicable to common stock	$	17,079	$	30,884	$	22,183	$	52,291
Diluted weighted-average common shares outstanding before participating security		93,239		83,155		92,543		82,809
Diluted EPS	$	0.18	$	0.37	$	0.24	$	0.63

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



Six months ended June 30,	2017		2016
Risk-free interest rate	1.97	%	1.20	%
Expected volatility	30.67	%	31.22	%
Dividend yield	—		—
Weighted-average expected life (years)	5.30		5.40

Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2017

Property and Equipment

Schedule of property and equipment, net


	June 30,		December 31,
	2017		2016
	(in thousands)

Property and equipment - non-master lease
Land and improvements	$	294,535	$	294,590
Building and improvements		405,024		404,158
Furniture, fixtures and equipment		1,374,884		1,355,615
Leasehold improvements		119,730		118,940
Construction in progress		38,619		16,375
		2,232,792		2,189,678
Less Accumulated depreciation		(1,296,962)		(1,224,596)
		935,830		965,082
Property and equipment - master lease
Land and improvements		435,043		382,246
Building and improvements		2,248,257		2,219,018
		2,683,300		2,601,264
Less accumulated depreciation		(791,413)		(745,963)
		1,891,887		1,855,301
Property and equipment, net	$	2,827,717	$	2,820,383

Acquisitions (Tables)

6 Months Ended

Jun. 30, 2017

Acquisitions

Schedule of estimated fair values of assets acquired and liabilities assumed as of the acquisition date


		May 1, 2017

Cash		$ 6,725
Other current assets		2,847
Property and equipment - non-master lease		8,368
Property and equipment - master lease		82,603
Goodwill		35,534
Other intangible assets		851
Total Assets		$ 136,928

Current portion of financing obligation		$ 1,968
Accrued expenses		3,716
Accrued salaries and wages		3,256
Other current liabilities		1,448
Long-term financing obligation		80,635
Total liabilities		$ 91,023
Cash paid		45,905
Total consideration transferred		$ 136,928

Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2017

Intangible Assets

Schedule of gross carrying value, accumulated amortization, and net book value of each major class of other intangible assets


	June 30, 2017						December 31, 2016
	(in thousands)
	Gross						Gross
	Carrying		Accumulated		Net Book		Carrying		Accumulated		Net Book
	Value		Amortization		Value		Value		Amortization		Value
Indefinite-life intangible assets	$	375,405	$	—	$	375,405	$	375,405	$	—	$	375,405
Other intangible assets		130,852		75,925		54,927		125,584		65,495		60,089
Total	$	506,257	$	75,925	$	430,332	$	500,989	$	65,495	$	435,494

Schedule of expected intangible asset amortization expense

The following table presents expected intangible asset amortization expense based on existing intangible assets as of June 30, 2017 (in thousands):


Remaining 2017	$	8,241
2018		12,885
2019		8,418
2020		5,854
2021		3,705
Thereafter		15,824
Total	$	54,927

Long-term Debt (Tables)

6 Months Ended

Jun. 30, 2017

Long-term Debt

Schedule of long-term debt, net of current maturities


	June 30,		December 31,
	2017		2016
	(in thousands)

Senior secured credit facility	$	845,000	$	976,845
$300 million 5.875 % senior subordinated notes due November 1, 2021		—		300,000
$400 million 5.625 % senior unsecured notes due January 15, 2027		400,000		—
Other long-term obligations		126,573		154,084
Capital leases		879		1,760
		1,372,452		1,432,689
Less current maturities of long-term debt		(35,675)		(85,595)
Less net discounts		(2,862)		(620)
Less debt issuance costs		(30,892)		(16,535)
	$	1,303,023	$	1,329,939

Schedule of future minimum repayments of long-term debt

The following is a schedule of future minimum repayments of long-term debt as of June 30, 2017 (in thousands):


Within one year	$	35,638
1-3 years		82,300
3-5 years		334,017
Over 5 years		920,497
Total minimum payments	$	1,372,452

- 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)

6 Months Ended

Jun. 30, 2017

Segment Information

Schedule of information with respect to the Company's segments


Three months ended June 30, 2017	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	108,119	$	20,062	$	59,283	$	(52,475)	$	134,989
Charge for stock compensation		—		—		—		1,801		1,801
Depreciation and amortization		21,525		9,353		9,508		28,583		68,969
Contingent purchase price		277		—		16		1,069		1,362
(Gain) loss on disposal of assets		(45)		(1)		88		10		52
Impairment losses on Loans to the Jamul Tribe		—		5,635		—		—		5,635
Income (loss) from unconsolidated affiliates		—		—		5,286		(265)		5,021
Non-operating items for Kansas JV		—		—		1,309		—		1,309
Adjusted EBITDA	$	129,876	$	35,049	$	75,490	$	(21,277)	$	219,138

Three months ended June 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	103,695	$	27,622	$	57,446	$	(39,426)	$	149,337
Charge for stock compensation		—		—		—		1,582		1,582
Depreciation and amortization		23,209		8,839		9,460		24,674		66,182
Contingent purchase price		119		—		—		—		119
Loss on disposal of assets		(14)		11		(52)		496		441
Income (loss) from unconsolidated affiliates		—		—		3,744		(196)		3,548
Non-operating items for Kansas JV		—		—		2,571		—		2,571
Adjusted EBITDA	$	127,009	$	36,472	$	73,169	$	(12,870)	$	223,780


Six months ended June 30, 2017	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	210,752	$	47,180	$	120,813	$	(103,469)	$	275,276
Charge for stock compensation		—		—		—		3,974		3,974
Depreciation and amortization		44,548		18,570		19,179		56,908		139,205
Contingent purchase price		1,182		—		25		2,715		3,922
(Gain) loss on disposal of assets		(31)		5		29		4		7
Impairment losses on Loans to the Jamul Tribe		—		5,635		—		—		5,635
Income (loss) from unconsolidated affiliates		—		—		10,290		(721)		9,569
Non-operating items for Kansas JV		—		—		3,260		—		3,260
Adjusted EBITDA	$	256,451	$	71,390	$	153,596	$	(40,589)	$	440,848

Six months ended June 30, 2016	Northeast		South/West		Midwest		Other (1)		Total
Income (loss) from operations	$	204,616	$	53,607	$	115,670	$	(84,025)	$	289,868
Charge for stock compensation		—		—		—		3,037		3,037
Depreciation and amortization		46,202		17,604		19,028		49,368		132,202
Contingent purchase price		(1,081)		—		—		—		(1,081)
Loss on disposal of assets		7		(14)		(45)		(608)		(660)
Income (loss) from unconsolidated affiliates		—		—		8,462		(305)		8,157
Non-operating items for Kansas JV		—		—		5,141		—		5,141
Adjusted EBITDA	$	249,744	$	71,197	$	148,256	$	(32,533)	$	436,664


		Northeast		South/West		Midwest		Other (1)		Total
	(in thousands)
Three months ended June 30, 2017
Net revenues	$	405,099	$	153,151	$	224,847	$	13,366	$	796,463
Capital expenditures		5,533		11,924		7,345		1,002		25,804

Three months ended June 30, 2016
Net revenues	$	401,516	$	140,108	$	220,256	$	7,542	$	769,422
Capital expenditures		8,268		6,726		6,348		823		22,165

Six months ended June 30, 2017
Net revenues	$	798,564	$	292,970	$	453,185	$	27,968	$	1,572,687
Capital expenditures		9,523		20,546		11,676		1,215		42,960

Six months ended June 30, 2016
Net revenues	$	794,722	$	276,076	$	441,334	$	13,741	$	1,525,873
Capital expenditures		15,387		14,311		12,330		1,506		43,534

Balance sheet at June 30, 2017
Total assets	$	808,144	$	876,910	$	1,081,316	$	2,217,649	$	4,984,019
Investment in and advances to unconsolidated affiliates		76		—		91,058		61,779		152,913
Goodwill and other intangible assets, net		324,285		260,978		778,056		92,900		1,456,219

Balance sheet at December 31, 2016
Total assets	$	861,951	$	840,076	$	1,103,231	$	2,169,226	$	4,974,484
Investment in and advances to unconsolidated affiliates		76		—		93,768		62,332		156,176
Goodwill and other intangible assets, net		324,285		224,719		775,377		100,798		1,425,179

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2017

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 June 30, 2017 and December 31, 2016 are as follows (in thousands):


	June 30, 2017
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	224,399	$	224,399	$	224,399	$	—	$	—
Loans to the Jamul Tribe		84,152		84,152		—		—		84,152
Financial liabilities:
Long-term debt
Senior secured credit facility		812,001		847,494		797,494		50,000		—
Senior unsecured notes		399,208		406,000		406,000		—		—
Other long-term obligations		126,573		127,301		—		127,301		—
Other liabilities		52,955		52,955		—		—		52,955


	December 31, 2016
	Carrying
	Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents	$	229,510	$	229,510	$	229,510	$	—	$	—
Loans to the Jamul Tribe		92,100		98,000		—		—		98,000
Financial liabilities:
Long-term debt
Senior secured credit facility		962,703		976,092		785,092		191,000		—
Senior unsecured notes		296,895		312,000		312,000		—		—
Other long-term obligations		154,084		152,132		—		152,132		—
Other liabilities		48,244		48,244		—		—		48,244

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):


	Six Months Ended
	June 30, 2017
	Liabilities			Assets
	Contingent			Loans to the
	Purchase Price			Jamul Tribe
Balance at January 1, 2017	$	48,244	$	98,000
Unamortized discount		—		(5,865)
Additions		830		372
Payments		(41)		(2,720)
Included in earnings		3,922		(5,635)
Balance at June 30, 2017	$	52,955	$	84,152

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 Speed	Option pricing method	Discount rate, Volatility rate	11.00	%	70.92	%

Investment In Unconsolidated Affiliates (Tables)

6 Months Ended

Jun. 30, 2017

Investment In Unconsolidated Affiliates

Schedule of summary financial information for Kansas Entertainment for the comparative periods presented in the Company's consolidated balance sheets and consolidated statements of operations


	Three Months Ended June 30,				Six Months Ended June 30,
	2017		2016		2017		2016
Net revenues	$	38,924	$	37,872	$	77,770	$	77,754
Operating expenses		28,352		30,384		57,190		60,829
Income from operations		10,572		7,488		20,580		16,925
Net income	$	10,572	$	7,488	$	20,580	$	16,925

Net income attributable to Penn	$	5,286	$	3,744	$	10,290	$	8,462

Organization and Basis of Presentation (Details)	6 Months Ended
Organization and Basis of Presentation (Details)	Jun. 30, 2017 jurisdiction facility item
Number of facilities the entity owned, managed, or had ownership interests in \| facility	29
Number of jurisdictions in which the entity operates \| jurisdiction	17
Prairie State Gaming
Number of video gaming terminal route operators acquired \| item	2

Summary of Significant Accounting Policies -Revenue Recognition, Player Loyalty Programs, and Gaming and Racing Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Revenue Recognition and Promotional Allowances
Promotional allowances	$ 45,983	$ 44,113	$ 87,841	$ 84,684
Cost of complimentary services	15,461	14,454	29,176	27,919
Gaming and Racing Taxes
Gaming expense	252,500	248,800	498,900	494,500
Rooms
Revenue Recognition and Promotional Allowances
Promotional allowances	10,298	10,098	19,493	19,220
Cost of complimentary services	1,480	1,349	2,736	2,546
Food And Beverage
Revenue Recognition and Promotional Allowances
Promotional allowances	33,386	31,796	63,953	61,318
Cost of complimentary services	13,009	12,194	24,629	23,718
Other
Revenue Recognition and Promotional Allowances
Promotional allowances	2,299	2,219	4,395	4,146
Cost of complimentary services	$ 972	$ 911	$ 1,811	$ 1,655

Summary of Significant Accounting Policies - Long-term Asset Related to Jamul Tribe (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality
Financing loan receivable, reserve allowance	$ 5,635	$ 0
Financing loan receivable, unpaid principal balance	98,100	98,000
Loans to the Jamul Tribe	84,152	$ 91,401
Delayed Draw Term Loan C Facility Commitments
Receivables - Loans and Debt Securities Acquired with Deteriorated Credit Quality
Additional borrowing capacity under the financing facility	$ 15,000

Summary of Significant Accounting Policies - Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Net income loss available to common stockholders
Net income	$ 17,079	$ 34,035	$ 22,183	$ 57,743
Net income applicable to preferred stock		3,151		5,452
Net income applicable to common stock	$ 17,079	$ 30,884	$ 22,183	$ 52,291
Determination of shares:
Weighted-average common shares outstanding (in shares)	90,928,000	81,647,000	90,840,000	81,308,000
Assumed conversion of dilutive employee stock-based awards (in shares)	2,230,000	1,474,000	1,629,000	1,459,000
Assumed conversion of restricted stock (in shares)	81,000	34,000	74,000	42,000
Diluted weighted-average common shares outstanding before participating security	93,239,000	83,155,000	92,543,000	82,809,000
Assumed conversion of preferred stock (in shares)		8,331,000		8,478,000
Diluted weighted-average common shares outstanding (in shares)	93,239,000	91,486,000	92,543,000	91,287,000
Calculation of basic EPS:
Net income applicable to common stock	$ 17,079	$ 30,884	$ 22,183	$ 52,291
Weighted-average common shares outstanding (in shares)	90,928,000	81,647,000	90,840,000	81,308,000
Basic EPS (in dollars per share)	$ 0.19	$ 0.38	$ 0.24	$ 0.64
Calculation of diluted EPS using two class method:
Net income applicable to common stock	$ 17,079	$ 30,884	$ 22,183	$ 52,291
Diluted weighted-average common shares outstanding before participating security	93,239,000	83,155,000	92,543,000	82,809,000
Diluted EPS (in dollars per share)	$ 0.18	$ 0.37	$ 0.24	$ 0.63
Anti-dilutive securities, options to purchase shares outstanding	55,062	1,696,858	1,598,500	2,889,501
Series C Preferred Stock
Earnings Per Share
Preferred stock, shares outstanding	0	7,447	0	7,447	0

Summary of Significant Accounting Policies - Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Stock-based compensation costs
Time period of historical volatility of stock used to estimate expected volatility			5 years 3 months 18 days
Dividend yield (as a percent)			0.00%
Granted (in shares)			1,475,224	1,561,035
Accrued salaries and wages	$ 86,292		$ 86,292		$ 92,238
Weighted-average assumptions used in the Black-Scholes option-pricing model
Risk-free interest rate (as a percent)			1.97%	1.20%
Expected volatility (as a percent)			30.67%	31.22%
Dividend yield (as a percent)			0.00%
Weighted-average expected life			5 years 3 months 18 days	5 years 4 months 24 days
Employee stock options \| General and administrative expenses
Stock-based compensation costs
Compensation costs related to stock-based compensation	1,800	$ 1,600	$ 4,000	$ 3,100
Phantom Share Units (PSUs)
Stock-based compensation costs
Compensation costs related to stock-based compensation	4,600	600	8,900	3,600
Accrued salaries and wages	10,500		10,500		5,600
Total compensation cost related to nonvested awards not yet recognized	6,700		$ 6,700
Period for recognition of unrecognized compensation cost			2 years 5 months 9 days
Amounts paid on cash settled awards	100	100	$ 3,600	4,500
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
Compensation costs related to stock-based compensation	4,600	(500)	$ 8,600	1,400
Accrued salaries and wages	13,700		13,700		$ 7,300
Total compensation cost related to nonvested awards not yet recognized	12,800		$ 12,800
Period for recognition of unrecognized compensation cost			2 years 9 months 26 days
Amounts paid on cash settled awards	$ 1,500	$ 1,100	$ 2,600	$ 1,500

Summary of Significant Accounting Policies - Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Segment Information
Impact to income from operations	$ 134,989	$ 149,337	$ 275,276	$ 289,868
Kansas Entertainment
Segment Information
Ownership interest in joint venture (as a percent)	50.00%		50.00%
Penn Interactive Ventures
Segment Information
Percent of net revenue			1.40%
Impact to income from operations			$ (2,300)
Percent of total assets	2.20%		2.20%

New Accounting Pronouncements (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended		12 Months Ended
	Jan. 01, 2017	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Dec. 31, 2015
New Accounting Pronouncements
Income tax benefit		$ (6,225)	$ (10,804)	$ (8,423)	$ (18,538)
Net cash provided by (used in) operating activities				195,906	194,038
Net cash provided by (used in) financing activities				(34,806)	(65,925)
Reimbursable management costs		$ 6,387	$ 2,855	13,145	$ 2,855
Accounting Standards Update 2016-09
New Accounting Pronouncements
Income tax benefit				1,900
Accounting Standards Update 2016-09 \| Adjustment
New Accounting Pronouncements
Increase in deferred tax assets	$ 16,400
Increase of valuation allowance	$ 16,400
Net cash provided by (used in) operating activities				4,400
Net cash provided by (used in) financing activities				(4,400)
Casino Rama
New Accounting Pronouncements
Reimbursable management costs				$ 42,800		$ 83,600	$ 81,300

Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Plant and equipment
Property and equipment, net	$ 2,827,717		$ 2,827,717		$ 2,820,383
Decrease in property and equipment			(7,300)
Depreciation expense	63,700	$ 65,700	128,700	$ 131,300
Interest capitalized in connection with major construction projects	100	0	100	0
Master Lease Agreement
Plant and equipment
Depreciation expense	23,000		45,700
Land and improvements - non-leased
Plant and equipment
Property and equipment	294,535		294,535		294,590
Land and improvements - master lease
Plant and equipment
Property and equipment	435,043		435,043		382,246
Building and improvements - non-leased
Plant and equipment
Property and equipment	405,024		405,024		404,158
Buildings and improvements - master lease
Plant and equipment
Property and equipment	2,248,257		2,248,257		2,219,018
Furniture, Fixtures and Equipment
Plant and equipment
Property and equipment	1,374,884		1,374,884		1,355,615
Leasehold Improvements
Plant and equipment
Property and equipment	119,730		119,730		118,940
Construction in progress - non-leased
Plant and equipment
Property and equipment	38,619		38,619		16,375
Non-leased assets
Plant and equipment
Property and equipment	2,232,792		2,232,792		2,189,678
Less Accumulated depreciation	(1,296,962)		(1,296,962)		(1,224,596)
Property and equipment, net	935,830		935,830		965,082
Master lease assets
Plant and equipment
Property and equipment	2,683,300		2,683,300		2,601,264
Less Accumulated depreciation	(791,413)		(791,413)		(745,963)
Property and equipment, net	$ 1,891,887		$ 1,891,887		$ 1,855,301
Depreciation expense		$ 22,800		$ 45,700

Acquisitions (Details) $ in Thousands	May 01, 2017 USD ($) company	Jun. 30, 2017 USD ($)	Dec. 31, 2016 USD ($)
Acquisitions
Initial annual payment under Master Lease with GLPI		$ 61,302	$ 56,595
Purchase price allocation
Goodwill		1,025,887	$ 989,685
Bally's and Resorts
Acquisitions
Number of businesses acquired \| company	2
Initial annual payment under Master Lease with GLPI	$ 9,000
Increase in financing obligation	82,600
Purchase price allocation
Cash	6,725
Other current assets	2,847
Goodwill	35,534
Other intangible assets	851
Total assets	136,928
Current portion of financing obligation	1,968
Long-term financing obligation	80,635
Accrued expenses	3,716
Accrued salaries and wages	3,256
Other current liabilities	1,448
Total liabilities	91,023
Cash paid	45,905
Total consideration transferred	136,928
Bally's and Resorts \| General and administrative expenses
Acquisitions
Transaction costs		$ 700
Non-leased assets \| Bally's and Resorts
Purchase price allocation
Property and equipment	8,368
Master lease assets \| Bally's and Resorts
Acquisitions
Increase in financing obligation	$ 82,600
Useful lives	31 years
Purchase price allocation
Property and equipment	$ 82,603

Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Intangible assets
Indefinite-life intangible assets	$ 375,405		$ 375,405		$ 375,405
Other intangible assets, Gross Carrying Value	130,852		130,852		125,584
Other intangible assets, Accumulated Amortization	75,925		75,925		65,495
Other intangible assets, Net Book Value	54,927		54,927		60,089
Total intangible assets, Gross Carrying Value	506,257		506,257		500,989
Total intangible assets, Net Book Value	430,332		430,332		$ 435,494
Change in other intangible assets during the period			$ (5,200)
Weighted average remaining amortization period			5 years 6 months
Intangible asset amortization expense	$ 5,300	$ 500	$ 10,500	$ 1,000
Illinois video gaming terminal operators
Intangible assets
Change in other intangible assets during the period			3,700
Bally's and Resorts
Intangible assets
Change in other intangible assets during the period			$ 900

Intangible Assets - Future Amortization (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Expected intangible asset amortization expense
Remainder of 2017	$ 8,241
2018	12,885
2019	8,418
2020	5,854
2021	3,705
Thereafter	15,824
Other intangible assets, Net Book Value	$ 54,927	$ 60,089

Long-term Debt - Debt Summary (Details) - USD ($)	Jun. 30, 2017	Mar. 31, 2017	Jan. 19, 2017	Dec. 31, 2016
Long-term Debt
Long-term debt	$ 1,372,452,000			$ 1,432,689,000
Less current maturities of long-term debt	(35,675,000)			(85,595,000)
Less net discounts	(2,862,000)			(620,000)
Less debt issuance costs	(30,892,000)			(16,535,000)
Long-term debt, net of current maturities and debt issuance costs	1,303,023,000			1,329,939,000
Senior Secured Credit Facility
Long-term Debt
Long-term debt	845,000,000			976,845,000
Senior Subordinated Notes, 5.875 Percent, Due November 2021
Long-term Debt
Long-term debt				300,000,000
Principal amount				$ 300,000,000
Interest rate (as a percent)		5.875%		5.875%
Senior Unsecured Notes 5.625 Percent Due January 15, 2027
Long-term Debt
Long-term debt	400,000,000
Principal amount	$ 400,000,000		$ 400,000,000
Interest rate (as a percent)	5.625%		5.625%
Other long-term obligations
Long-term Debt
Long-term debt	$ 126,573,000			$ 154,084,000
Capital leases
Long-term Debt
Long-term debt	$ 879,000			$ 1,760,000

Long-term Debt - Future Minimum Repayments (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Dec. 31, 2016
Future minimum repayments of long-term debt
Within one year	$ 35,638
1-3 years	82,300
3-5 years	334,017
Over 5 years	920,497
Long-term debt	$ 1,372,452	$ 1,432,689

Long-term Debt - Senior Secured Credit Facility and Senior Notes (Details) - USD ($)		1 Months Ended	3 Months Ended	6 Months Ended
	Jan. 19, 2017	Jan. 31, 2017	Mar. 31, 2017	Jun. 30, 2017	Dec. 31, 2016
Long-term Debt
Loss on early extinguishment of debt				$ 23,390,000
Senior Secured Credit Facility
Long-term Debt
Refinancing costs				1,700,000
Loss on early extinguishment of debt				2,300,000
Term loan amount outstanding				845,000,000
Revolving credit facility
Long-term Debt
Term of debt	5 years
Maximum borrowing capacity	$ 700,000,000
Available borrowing capacity				627,900,000
Term loan amount outstanding				50,000,000
Letters of credit outstanding				22,100,000
Term Loan A Facility
Long-term Debt
Term of debt	5 years
Maximum borrowing capacity	$ 300,000,000
Variable interest rate	LIBOR
Term loan amount outstanding				296,200,000
Term Loan B Facility
Long-term Debt
Term of debt	7 years
Maximum borrowing capacity	$ 500,000,000
Variable interest rate	LIBOR
Variable interest rate spread (as a percent)	2.50%
Variable interest base rate floor rate (as a percent)	0.75%
Term loan amount outstanding				498,800,000
Senior Subordinated Notes, 5.875 Percent, Due November 2021
Long-term Debt
Loss on early extinguishment of debt				21,100,000
Amount of debt extinguished			$ 300,000,000
Principal amount					$ 300,000,000
Interest rate (as a percent)			5.875%		5.875%
Senior Unsecured Notes 5.625 Percent Due January 15, 2027
Long-term Debt
Principal amount	$ 400,000,000			$ 400,000,000
Interest rate (as a percent)	5.625%			5.625%
Percentage of principal amount at which the entity may redeem notes from net proceeds raised in connection with an equity offering	105.625%
Percentage of the aggregate principal amount of the notes originally issued which must remain outstanding at redemption under terms of the notes	60.00%
Period from completion of equity offering, during which notes can be redeemed	180 days
Corporate airplane loan
Long-term Debt
Amount of debt extinguished		$ 20,800,000
Minimum \| Term Loan A Facility
Long-term Debt
Variable interest rate spread (as a percent)	1.25%
Maximum \| Term Loan A Facility
Long-term Debt
Variable interest rate spread (as a percent)	3.00%

Master Lease Financing Obligation (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	May 01, 2017
Master Lease Agreement
Capital Leased Assets
Discount rate (as a percent)			9.70%
Total payments under Master Lease	$ 114.0	$ 110.8	$ 226.4	$ 222.2
Interest expense for the Master Lease	$ 99.4	$ 97.8	$ 197.1	$ 196.5
Bally's and Resorts
Capital Leased Assets
Increase in financing obligation					$ 82.6

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Segment Information (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Segment information
Income (loss) from operations	$ 134,989	$ 149,337	$ 275,276	$ 289,868
Charge for stock compensation	1,801	1,582	3,974	3,037
Depreciation and amortization	68,969	66,182	139,205	132,202
Contingent purchase price	1,362	119	3,922	(1,081)
Loss (gain) loss on disposal of assets	52	441	7	(660)
Income from unconsolidated affiliates	5,021	3,548	9,569	8,157
Impairment losses on Loans to the Jamul Tribe	5,635		5,635
Adjusted EBITDA	219,138	223,780	440,848	436,664
Net revenues	796,463	769,422	1,572,687	1,525,873
Capital expenditures	25,804	22,165	42,960	43,534
Total assets	4,984,019		4,984,019		$ 4,974,484
Investment in and advances to unconsolidated affiliates	152,913		152,913		156,176
Goodwill and other intangible assets, net	1,456,219		1,456,219		1,425,179
Kansas Entertainment
Segment information
Non-operating items	1,309	2,571	3,260	5,141
Operating Segments \| Northeast
Segment information
Income (loss) from operations	108,119	103,695	210,752	204,616
Depreciation and amortization	21,525	23,209	44,548	46,202
Contingent purchase price	277	119	1,182	(1,081)
Loss (gain) loss on disposal of assets	(45)	(14)	(31)	7
Adjusted EBITDA	129,876	127,009	256,451	249,744
Net revenues	405,099	401,516	798,564	794,722
Capital expenditures	5,533	8,268	9,523	15,387
Total assets	808,144		808,144		861,951
Investment in and advances to unconsolidated affiliates	76		76		76
Goodwill and other intangible assets, net	324,285		324,285		324,285
Operating Segments \| South/West
Segment information
Income (loss) from operations	20,062	27,622	47,180	53,607
Depreciation and amortization	9,353	8,839	18,570	17,604
Loss (gain) loss on disposal of assets	(1)	11	5	(14)
Impairment losses on Loans to the Jamul Tribe	5,635		5,635
Adjusted EBITDA	35,049	36,472	71,390	71,197
Net revenues	153,151	140,108	292,970	276,076
Capital expenditures	11,924	6,726	20,546	14,311
Total assets	876,910		876,910		840,076
Goodwill and other intangible assets, net	260,978		260,978		224,719
Operating Segments \| Midwest
Segment information
Income (loss) from operations	59,283	57,446	120,813	115,670
Depreciation and amortization	9,508	9,460	19,179	19,028
Contingent purchase price	16		25
Loss (gain) loss on disposal of assets	88	(52)	29	(45)
Income from unconsolidated affiliates	5,286	3,744	10,290	8,462
Adjusted EBITDA	75,490	73,169	153,596	148,256
Net revenues	224,847	220,256	453,185	441,334
Capital expenditures	7,345	6,348	11,676	12,330
Total assets	1,081,316		1,081,316		1,103,231
Investment in and advances to unconsolidated affiliates	91,058		91,058		93,768
Goodwill and other intangible assets, net	778,056		778,056		775,377
Operating Segments \| Midwest \| Kansas Entertainment
Segment information
Non-operating items	1,309	2,571	3,260	5,141
Other
Segment information
Income (loss) from operations	(52,475)	(39,426)	(103,469)	(84,025)
Charge for stock compensation	1,801	1,582	3,974	3,037
Depreciation and amortization	28,583	24,674	56,908	49,368
Contingent purchase price	1,069		2,715
Loss (gain) loss on disposal of assets	10	496	4	(608)
Income from unconsolidated affiliates	(265)	(196)	(721)	(305)
Adjusted EBITDA	(21,277)	(12,870)	(40,589)	(32,533)
Net revenues	13,366	7,542	27,968	13,741
Capital expenditures	1,002	$ 823	1,215	$ 1,506
Total assets	2,217,649		2,217,649		2,169,226
Investment in and advances to unconsolidated affiliates	61,779		61,779		62,332
Goodwill and other intangible assets, net	$ 92,900		$ 92,900		$ 100,798

Fair Value Measurements (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Fair Value Measurements (Details) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Hollywood Gaming at Dayton Raceway And Mahoning Valley Race Course
Fair value of assets and liabilities
Discount Rate			5.00%
Contingent Purchase Price \| Plainridge Racecourse
Fair value of assets and liabilities
Charge (reduction) to general and administrative expense related to change in fair value measurement of contingent obligations	$ 1,400	$ 100	$ 3,900	$ (1,100)
Level 1
Fair value of assets and liabilities
Cash and cash equivalents	224,399		224,399		$ 229,510
Level 3
Fair value of assets and liabilities
Loans to Jamul Tribe	84,152		84,152		98,000
Financial liabilities:
Other liabilities	52,955		52,955		48,244
Level 3 \| Loans to the Jamul Tribe
Fair value of assets and liabilities
Balance at beginning of the period			98,000
Unamortized discount			(5,865)
Additions			372
Payments			(2,720)
Included in earnings			(5,635)
Balance at end of the period	84,152		84,152
Level 3 \| Contingent Purchase Price
Financial liabilities:
Balance at beginning of the period			48,244
Additions			830
Payments			(41)
Included in earnings			3,922
Balance at end of the period	52,955		$ 52,955
Level 3 \| Contingent Purchase Price \| Discounted Cash Flow \| Plainridge Racecourse
Fair value of assets and liabilities
Discount Rate			8.30%
Level 3 \| Contingent Purchase Price \| Option Pricing Method \| Rocket Speed
Fair value of assets and liabilities
Discount Rate			11.00%
Volatility rate			70.92%
Senior Secured Credit Facility \| Level 1
Financial liabilities:
Long-term debt	797,494		$ 797,494		785,092
Senior Secured Credit Facility \| Level 2
Financial liabilities:
Long-term debt	50,000		50,000		191,000
Senior Unsecured Notes \| Level 1
Financial liabilities:
Long-term debt	406,000		406,000		312,000
Other long-term obligations \| Level 2
Financial liabilities:
Long-term debt	127,301		127,301		152,132
Carrying Amount
Fair value of assets and liabilities
Cash and cash equivalents	224,399		224,399		229,510
Loans to Jamul Tribe	84,152		84,152		92,100
Financial liabilities:
Other liabilities	52,955		52,955		48,244
Carrying Amount \| Senior Secured Credit Facility
Financial liabilities:
Long-term debt	812,001		812,001		962,703
Carrying Amount \| Senior Unsecured Notes
Financial liabilities:
Long-term debt	399,208		399,208		296,895
Carrying Amount \| Other long-term obligations
Financial liabilities:
Long-term debt	126,573		126,573		154,084
Fair Value
Fair value of assets and liabilities
Cash and cash equivalents	224,399		224,399		229,510
Loans to Jamul Tribe	84,152		84,152		98,000
Financial liabilities:
Other liabilities	52,955		52,955		48,244
Fair Value \| Senior Secured Credit Facility
Financial liabilities:
Long-term debt	847,494		847,494		976,092
Fair Value \| Senior Unsecured Notes
Financial liabilities:
Long-term debt	406,000		406,000		312,000
Fair Value \| Other long-term obligations
Financial liabilities:
Long-term debt	$ 127,301		$ 127,301		$ 152,132

Investment In Unconsolidated Affiliates (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) ft² item	Jun. 30, 2016 USD ($)
Summary financial information
Net income attributable to Penn	$ 5,021	$ 3,548	$ 9,569	$ 8,157
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			41
Number of poker tables \| item			12
Number of space parking \| item			1,253
Summary financial information
Net revenues	$ 38,924	37,872	$ 77,770	77,754
Operating expenses	28,352	30,384	57,190	60,829
Income from operations	10,572	7,488	20,580	16,925
Net income	10,572	7,488	20,580	16,925
Net income attributable to Penn	$ 5,286	$ 3,744	$ 10,290	$ 8,462