harrah's entertainment barclays_presentation

Harrah’s Entertainment, Inc.

September 2008

Strictly Confidential and Proprietary – Do Not Reproduce

2

Forward Looking Statements

Certain information in this presentation may be considered forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. This information is based on the Company's current expectations and actual results could vary materially depending on risks and uncertainties that may affect the Company's operations, markets, services, prices and other factors as discussed in filings with the Securities and Exchange Commission. These risks and uncertainties include, but are not limited to, industry and economic conditions, competitive, legal, governmental and technological factors. There is no assurance that the Company's expectations will be realized. The Company assumes no obligation to update any forward-looking information contained in this presentation should circumstances change, except as otherwise required by securities and other applicable laws.

Market data and other statistical information used throughout this presentation are based on independent industry publications, government publications, reports by market research firms or other published independent sources. Some data are also based on our good faith estimates which are derived from our review of internal surveys, as well as the independent sources listed above. Although we believe these sources are reliable, we have not independently verified the information and cannot guarantee its accuracy and completeness.


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Corporate Structure

All Material Operating

Subsidiaries

Harrah’s Operating Company, Inc.

(“HOC”)

$2.0 bn Revolver (Undrawn)$7.3 bn Term Loan B Facility$6.8 bn New Senior Notes/Bridge$4.6 bn Existing Senior Unsecured Notes

$6.5 bn CMBS Debt CMBS Borrowers

Subsidiary Pledgors under New Credit Facility and Guarantors under Senior Unsecured Bridge Facility / Notes

HOC Borrowing Structure


Guarantor of new and existing HOC DebtGuarantor of leases for PropCo debt

LTM through of 6/30/08• Includes captive insurance subsidiaries.• Includes 10 casino clubs in the UK, 2 in Egypt and 1 in South Africa.

PropCo Borrowing Structure

Underlying Properties Underlying Properties

Imperial PalaceBill’s Gamblin’ Hall

& SaloonBally's Las VegasCaesars PalaceHarrah's Lake TahoeBill's Lake TahoeHarveys Lake TahoeBally's Atlantic City

LTM Revenue: $2.7 bnLTM Adjusted EBITDA: $0.8 bn



Caesars Atlantic CityShowboat Atlantic CityHarrah’s Chester (PA)Harrah's New Orleans (LA)Harrah's Louisiana Downs (LA)Horseshoe Bossier City (LA)Horseshoe Tunica (MS)Grand Tunica (MS)Grand Biloxi (MS)

Sheraton Tunica (MS)Harrah's Council Bluffs (IA)Horseshoe Council Bluffs /

Bluffs Run (IA)Harrah's North Kansas City (MO)Harrah's St. Louis (MO)Harrah's Joliet (IL)Harrah's Metropolis (IL)Horseshoe Hammond (IN)

Caesars IndianaHarrah's RenoHarrah’s Ak-ChinHarrah’s RinconHarrah’s CherokeeCasino WindsorConrad Punta Del EsteLondon Clubs (2)125 acres of developable

land in Las Vegas175 acres of land in Macau

Harrah's Las VegasRioFlamingo Las VegasParis Las VegasHarrah's Atlantic CityHarrah's Laughlin

Other (1)

Business & Market Overviews


5

Las Vegas, 33%

Atlantic City, 23%

Mississippi / Louisiana, 14%

Illinois / Indiana, 12%

Iowa / Missouri, 7%

Other Nevada, 6%

Managed / Intl / Other, 5%

Las Vegas, 41%

Atlantic City, 22%



Iowa / Missouri, 8%

Other Nevada, 5%


One of the world’s largest and most diversified gaming companies

– #1 or #2 market share in almost every major market in the U.S.

– 51 casinos in six countries (1)

– Approximately 40,000 hotel rooms and suites, 3 million square feet of casino gaming space, and 2 million square feet of convention center space (1)

Industry leading loyalty program (Total Rewards) with over 40 million members

(1) As of June 30, 2008, HOC and its subsidiaries own or manage 45 of the Harrah’s Entertainment casinos.(2) Property EBITDA excludes corporate overhead, normalizations and pro forma cost savings. HOC LTM Net Revenue of $8.0 billion and Property EBITDA of $1.8 billion.

LTM 6/30/08 Net Revenue ($10.7 Billion)(2) LTM 6/30/08 Property EBITDA ($2.7 Billion)(2)

Company SnapshotA Portfolio of Winning Brands


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Differentiated Business Strategy

• Focuses on organizational restructuring, teleservices reorganization and procurement savings

• Substantial progress against $164M savings goal

• Ongoing rationalization of property labor and marketing costs

Increase Profitability

• Stable, predictable revenue• High operating margins• Low maintenance capex• Growth capex channeled to highest return uses

Maximize Cash Flow

• Leverage scale and Total Rewards program to generate same store gaming revenue growth and cross-market play

- Hub and spoke network of properties- Highly scalable existing infrastructure- Application of centralized marketing to new properties/operations

• Pursue targeted investments in proven markets

Drive Profitable Sales Growth


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Highly Strategic Las Vegas Market Position…Harrah’s has the #2 Market Share in Las Vegas, With 8 Properties

28% of the Strip’s revenue and 25% of the Strip’s positions160 contiguous acres on the east side of the Strip combined with 170 acres on the west side

– 125 acres of developable landHarrah’s controls three of the “4 Corners” at the intersection of Flamingo and Las Vegas Blvd

Las Vegas Property Map

* Denotes property either under development or planned for development.

*

The WynnGolf Club

Universityof Nevada –Las Vegas

McCarranInt’l

Airport

FashionShow Mall

15

Tropicana Ave

Flamingo Rd

Spring Mountain Rd

E. Desert Inn RdW. Desert Inn Rd

The S

trip

604

Fontainebleau*

Echelon*

Circus Circus

New Frontier Montreux*

Treasure Island

Venetian

Mirage

Caesar’sRio

Palms Bellagio

Cosmopolitan*

City Center*

Monte Carlo

Mandalay Bay

Luxor

Excaliber

New York New YorkTropicana Ave

To Downtown Stratosphere

Harmon Blvd

The WynnGolf Club

Universityof Nevada –Las Vegas

McCarranInt’l

Airport

FashionShow Mall

1515

Tropicana Ave

Flamingo Rd

Spring Mountain Rd

E. Desert Inn RdW. Desert Inn Rd

The S

trip

604

Fontainebleau*

Echelon*

Circus Circus

New Frontier Montreux*

Treasure Island

Venetian

Mirage

Caesar’sRio

Palms Bellagio

Cosmopolitan*

City Center*

Monte Carlo

Mandalay Bay

Luxor

Excaliber

New York New York

Fontainebleau*

Echelon*

Circus Circus

Plaza*

Treasure Island

Venetian

Mirage

CaesarsRio

Palms Bellagio

Cosmopolitan*

City Center*

Monte Carlo

Mandalay Bay

Luxor

Excaliber

New York New York

Sahara

Riviera

Encore*

LV Hilton

Convention Center

Wynn

Palazzo*

Barbary Coast

FlamingoSands Expo

Royale Imperial Palace

Harrah’s

Bally’s

Paris

Tropicana

MGM Grand

Hooters

**

Hard Rock

Aladdin/Planet Hollywood

Sahara

Riviera

Encore*

LV Hilton

Convention Center

Wynn

Palazzo*

Bill’s Gamblin’ Hall

FlamingoSands Expo

Imperial Palace

Harrah’s

Bally’s

Paris

Tropicana

MGM Grand

Hooters

**

Hard Rock

Planet HollywoodTropicana Ave

To Downtown Stratosphere

Harmon Blvd

PropCoHOC Harrah’s Undeveloped Land


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… Drives Market Outperformance

Caesars Palace

Harrah’s Las Vegas

Bally’s Las Vegas

Paris Las Vegas

21042,500Bill’s Gamblin’Hall & Saloon

2,64075,000Imperial Palace

3,50076,800Flamingo Las Vegas

20,480

2,920

2,810

2,530

2,520

3,350

Rooms & Suites

85,000Paris Las Vegas

66,400Bally’s Las Vegas

90,300Harrah’s Las Vegas

TOTAL

Rio Hotel & Casino

Caesars Palace

PropertyCasino Space

(sq. ft.)

672,900

107,000

129,900

($ in millions)

Rio Hotel & Casino

$3,542HET Las Vegas LTM Net Revenues$1,123HET Las Vegas LTM EBITDA


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Atlantic City Snapshot

Harrah’s Atlantic City

Showboat Atlantic City

Bally’s Atlantic City

Caesars Atlantic City

--92,000Harrah’s Chester (PA)

5,840

1,330

1,630

1,140

1,740

Rooms & Suites

124,200Showboat Atlantic City

160,800Harrah’s Atlantic City

TOTAL

Caesars Atlantic City

Bally’s Atlantic City

Property Casino Space (sq. ft.)

747,800

145,000

225,800

($ in millions)

Note: LTM as of 6/30/08.

$2,402HET Atlantic City LTM Net Revenues

$595HET Atlantic City LTM EBITDA


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The Leader in Regional Markets

Caesars Indiana Grand Casino Biloxi Grand Casino Tunica

37%

32%

37%

Harrah’s Market Share(1)

$789

$223

$234

$332

LTM EBITDA

$2,105

$4,034

$3,267

2007 Market Revenues

15

4

4

7

Properties

5,650

1,140

960

3,550

Rooms & Suites

$3,535

$799

$1,288

$1,508

LTM Net Revenues

286,900Iowa / Missouri(4)

TOTAL

Illinois / Indiana(3)

Louisiana / Mississippi(2)

MarketCasino Space

(sq. ft.)

903,300

188,900

427,500

($ in millions)

Note: LTM as of 6/30/08. All properties included in HOC.Source of market revenues and Harrah’s market share: State gaming commission and control boards.(1) Market Share based on year ending Dec.2007(2) Louisiana / Mississippi market defined as Shreveport – Bossier City, LA, New Orleans, LA, Gulfcoast and Tunica, MS. (3) Illinois / Indiana market defined as Chicagoland and Southern Illinois and Indiana. (4) Iowa / Missouri market defined as Council Bluffs, IA, St. Louis, MO, and Kansas City, MO.


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Growing International PresenceLondon Clubs International

Properties in London, Egypt and South Africa

Total Casino Space: 143,200 sq. ft.

Total Hotel Rooms & Suites: 190

Macau Orient Golf Course18-hole golf course on 175 acres in Cotai

Acquired in September 2007

Casino Windsor, Ontario (1)

Casino Space:100,000 sq. ft.

Hotel Rooms & Suites: 340

Conrad Punta Del Este Resort & Casino, UruguayOnly Las Vegas style resort and casino in Uruguay

Total Casino Space: 44,500 sq. ft.

– 510 slot machines, 50 table games

Total Hotel Rooms & Suites: 300

The Golden Nugget – London

Fifty – London

Emerald Safari – South Africa

175 Acres on Cotai Strip in Macau

MACAU ORIENT GOLF (OWNED BY HARRAH’S)

MACAU STUDIO CITY

BORDER CROSSING

RESERVOIR

TBD

MACAU DOME

GALAXY

FOUR SEASONS

FAR EAST

VENETIAN

FAIRMONT RAFFLES

HILTON CONRAD

SHERATONST. REGIS

CITY OF DREAMS

Nature preserve

(1) HOC owns a 50% interest in Windsor Casino Limited, which manages the property.

Investment For Growth


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Harrah’s Atlantic City ExpansionProject Overview

New Waterfront hotel tower, connected to existing BayviewTowerNumber of Hotel Rooms: 851Number of Suites: 109Amentities: – Elizabeth Arden Red Door Spa; – The Pool (80,000 gallon pool under 90ft. glass dome w/82

degree temp); – Daytime pool with cabanas and club atmosphere at night;– The Waterfront Shops (7 unique shops);– Taste of the Shore Food Court (4 eateries), Waterfront

Buffet, new Reflections Cafe and McCormick & Schmick’s(located on existing property)

Official opening ceremony March 6, 2008


14

Horseshoe Hammond ExpansionProject Overview

Riverboat casino on Indiana side of Lake MichiganCasino Space: 48,300 sq. ft.Slot Machines: 1,940Table Games: 60 Expanded casino space of 108,000 sq. ft. will include +3,200 slots and 94 table games including 40 poker tablesOfficially opened July 29, 2008


15

Caesars Palace Las Vegas ExpansionProject Overview

New hotel tower and convention space on Flamingo Road next to existing Augustus TowerNumber of hotel rooms: 662Number of suites: 68New convention space: 110,000 s.f.3 Pool Villas; 3 new poolsRenovate buffet, Race & Sports Book, miscellaneous restaurants, casino spaceHotel and convention space scheduled to open Summer 2009


16

Harrah’s KansasProject Overview

Awarded sole gaming contract in southcentral Kansas– Subject to completion of background investigations and

licensing requirements$485M resort casino

– 2,000 slots, 50 tables, WSOP Poker Room– 175 hotel rooms, including 30 suites and 5 pool villas– 30,000 square feet of convention space– 5 restaurants, including celebrity concepts – 18 hole championship golf course

JV with local real estate developersAttractive project due to proximity to Wichita and limited competition in area

– Project located within 20 minute drive of Wichita city center– Also within driving distance of Oklahoma City

Opening expected in August 2010

Investment Strengths


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Market Leader with Unparalleled ScaleHarrah’s is the world’s largest and most diversified gaming company

– 51 casinos across 6 countries (1)

– #1 or #2 share in almost every major domestic market

Unparalleled Scale and Diversification Drives Growth and StabilityNote: Joint venture interest in Canadian property not directly owned.(1) HOC owns or manages 45 casinos.

DetroitAtlantic City

New Orleans

BiloxiLakeCharles

Shreveport /Bossier City Vicksburg

Tunica

St. Louis

Kansas City

Council BluffsChicagoland

Black Hawk /Central City

Cripple Creek

Las Vegas

Laughlin

Reno / Lake Tahoe

#1#1

#1#1

#1#1

#1#1

#2#2

#2#2

#1#1

#1#1

#1#1#1#1

#1#1

#2#2

Chester

HOC PropertyHOC Property

Native American CasinoManaged by HOCNative American CasinoManaged by HOC

Major Gaming MarketMajor Gaming Market

#1 #1 Market Share#1#1 #1 Market Share

#2 #2 Market Share#2#2 #2 Market Share

PropCo PropertyPropCo Property


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Las Vegas Locals, 78%

Managed, 22%

Macau, 58%

, 42%

Macau, 63%

, 37%

Las Vegas Locals, 50%

Midwest / South, 31%

AC (Borgota ) (2), 19%

Las Vegas Strip, 82%

Detroit, 6%

AC (Borgota ) (2), 5%

Mississippi, 4%

Other, 3%

Las Vegas, 41%

Atlantic City, 22%



Iowa / Missouri, 8%

Other Nevada, 5%


Most Diversified Gaming Operator

Source: Derived or extrapolated from public company filings and available third party analyst reports.(1) Represents HET consolidated.(2) Borgata is 50/50 owned by MGM/Boyd.(3) Based off 2007 operating income as reported.(4) Based off Adjusted EBITDAR.

LTM 6/30/08 EBITDA by Geography

Harrah’s (1) MGM Mirage Wynn

Station (3) Boyd Las Vegas Sands (4)

Las Vegas

Las Vegas


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Portfolio of Leading BrandsEach brand has a strong identity and enjoys powerful customer recognitionDiverse collection of brands appeals to wide range of customer preferences and encourages multiple visits


21

LoyaltyBrand

Decision sciencecapabilities

Hydrogen

LoyaltyBrand

Decision sciencecapabilities

Hydrogen

Superior Business Model: Generating Same Store Gaming Revenue Growth and Cross-Market Play


22

Strong and Predictable Free Cash Flow Generation

Stable and predictable revenues– Favorable business mix with over 70% of gross revenue driven by

casino operations– High operating margins– Profitability improvement program implemented in 2006

Reasonable capital expenditure requirements– Well-maintained asset base ($4.6 billion of total capex since 2004)– Capital expenditures channeled to highest return uses


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Substantial Land Value125 Undeveloped Las Vegas Acres 175 Acres on Cotai Strip in Macau

125 undeveloped Las Vegas acres surrounding the Strip Purchased Macau Orient Golf in September 2007

Purchase price: $578 million

Flamingo Road

Las Vegas B

lvd.

36.73 Acres

3.87 Acres

38.15(1)

Acres

48.21 Acres MACAU ORIENT GOLF

(OWNED BY HARRAH’S)

MACAU STUDIO

CITY

BORDER CROSSING

RESERVOIR

TBD

MACAU DOME

GALAXY

FOUR SEASONS

FAR EAST

VENETIAN

FAIRMONT

RAFFLES

HILTON CONRA

D

SHERATONST.

REGIS

CITY OF

DREAMS

Nature preserve

Illustrative IllustrativeValue / Acre ($mm) Value ($mm) (a)

$30 $3,75025 3,12520 2,50015 1,87510 1,250

(a) Based on 125 acres

(1) Total size of indicated plot is 38.15 acres, with 36.20 acres owned by Harrah’s.Note: Values shown for Las Vegas land are for illustrative purposes only and do not reflect any performed land value appraisals by the Company.


September 2008

harrah's entertainment barclays_presentation

Economy & Finance