arrah's intends to use a portion of the cash raised in the offering to retire a portion of Harrah's existing debt and for general corporate purposes. Because of uncertainties about its financial performance, Harrah's debt has been trading at a discount.
The company has taken advantage of this by swapping old debt for new debt and cash, overall reducing its debt burden and annual interest expenses.
During the first quarter, Harrah's completed debt exchanges that reduced debt by us$ 1.8 billion and annual interest expenses by us$ 73 million at Harrah's Operating Co.; and overall for Harrah's Entertainment that cut debt by us$ 2.3 billion and reduced yearly interest costs by us$ 104 million.
Previously, the Las Vegas company for the first quarter of 2009 reported that revenue fell 13.3 % from the 2008 quarter. The company's loss from continuing operations narrowed, from us$ 275 million in the 2008 quarter to us$ 127.4 million in the 2009 quarter.