Corrections Corporation of America Announces Third Quarter Results
The third quarter results discussed below include the operating results of the former operating company that was acquired October 1, 2000, and the former service companies that were acquired December 1, 2000. As a result of these acquisitions, the operating results of the Company for the third quarter of 2001 and the third quarter of 2000 are not comparable.
For the three months ended September 30, 2001, the Company reported a net loss available to common stockholders of $5.7 million, or $0.23 per share, compared with a net loss available to common stockholders of $261.1 million, or $22.04 per share, for the prior-year three-month period. For the nine months ended September 30, 2001, the Company reported a net loss available to common stockholders of $20.3 million, or $0.84 per share, compared with a net loss available to common stockholders of $378.5 million, or $31.96 per share, for the same period in 2000. The results for the three and nine months ended September 30, 2001, include the effects of non-cash charges of $5.6 and $11.9 million, respectively, associated with the accounting for an interest rate swap agreement in accordance with Statement of Financial Accounting Standards No. 133. Per share results for 2000 have been retroactively restated to reflect the one-for-ten reverse stock split of the Company's common stock effective May 18, 2001.
Third quarter consolidated revenue amounted to $248.2 million. Consolidated EBITDA for the quarter was $50.2 million, while average compensated occupancy for the quarter was 88.8%.
Commenting on the results for the third quarter, President and CEO John Ferguson stated, "We are pleased with the Company's continued operational improvement. Revenue per man-day increased for the third consecutive quarter while at the same time we continued to aggressively manage costs. Looking forward, we are pursuing a number of initiatives which, if successful, should increase occupancy and return the Company to profitability."
On October 3, 2001, the Company sold its Southern Nevada Women's Correctional facility for $24.1 million. Proceeds from the sale were used to reduce the outstanding total balance under the Company's senior bank credit facility. During 2001, the Company has reduced total debt balances by approximately $186.8 million through a combination of cash generated from asset sales and working capital.
After giving consideration to conditions currently existing in the debt and capital markets, the Company has determined to seek a modification of the revolving loan portion of its senior bank credit facility to convert it into a term loan maturing December 31, 2002. The revolving loan, currently amounting to approximately $269.4 million, is due January 1, 2002. The modification and related amendment to extend the maturity will require the consent of 100% of the participants in the revolving credit portion of the senior bank credit facility, and is currently expected to require the consent of two-thirds of the lenders in the term loan portion of the senior bank credit facility.
EBITDA for the third quarter amounted to $50.2 million while debt service for the quarter, excluding non-cash items, amounted to $25.2 million. At September 30, 2001, the Company had cash on hand of approximately $33.4 million and had $50.0 million available under a working capital line of credit. The outstanding balance under the Company's senior bank credit facility has been reduced from $972.3 million on January 1, 2001, to its current balance of $794.1 million.
For the quarter ended September 30, 2001, key operating statistics were as follows:
Pro-Forma Metric Quarter Ended Quarter Ended Quarter Ended Quarter Ended September 30, June 30, March 31, December 31, 2001 2001 2001 2000 Average Available Beds 61,343 61,408 61,462 61,462 Average Compensated Occupancy 88.8% 89.1% 88.3% 86.9% Total Compensated Man-Days 5,010,195 4,979,785 4,883,865 4,915,894 Revenue per Compensated Man-Day $48.46 $48.03 $47.91 $46.96 Operating Expenses per Compensated Man-Day: Fixed $27.28 $27.09 $26.98 $26.32 Variable 9.62 10.05 10.08 12.39 Total $36.90 $37.14 $37.06 $38.71 Operating Margin per Compensated Man-Day $11.56 $10.89 $10.85 $8.25 Operating Margin Rate 23.8% 22.7% 22.6% 17.6%
During the quarter, the Company successfully renewed contracts in five jurisdictions at increased rates. In addition, two prison facilities received notification of accreditation from the American Correctional Association. At September 30, 2001, approximately 77% of the Company's facilities have received ACA accreditation.
"The Company generated another solid quarter on a number of fronts," stated Ferguson. "Although this quarter's operating performance is encouraging, we also recognize that there are several objectives we must accomplish before year-end including the modification of our credit facility. We intend to work diligently with our lender group to accomplish the modification with the goal of putting permanent financing in place during the first half of next year."
The Company is the nation's largest provider of outsourced detention and corrections management services, housing an inmate population larger than that of all but five public correctional systems in the United States. The Company specializes in owning, operating and managing prisons and other correctional facilities and providing inmate residential and prisoner transportation services for governmental agencies. In addition to providing the fundamental residential services relating to inmates, each of the Company's facilities offers a variety of rehabilitation and educational programs, including basic education, life skills and employment training and substance abuse treatment. The Company also provides health care (including medical, dental and psychiatric services), institutional food services and work and recreational programs. The Company owns or manages approximately 65,000 beds in 70 facilities in the United States and Puerto Rico, with 64 facilities under contract for management containing approximately 61,000 beds, four leased facilities and two facilities under construction.
This press release contains statements that are forward-looking statements as defined within the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. Factors that could cause operating and financial results to differ are described in the Company's Form 10-K, as well as in other documents filed with the Securities and Exchange Commission, and these factors include, but are not limited to, the growth of the private cohe date hereof or for any changes or modifications made to the press release or the information contained herein by any third-parties, including, but not limited to, any wire or internet services.
CORRECTIONS CORPORATION OF AMERICA AND SUBSIDIARIES (FORMERLY PRISON REALTY TRUST, INC.) CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) ASSETS September 30, December 31, 2001 2000 Cash and cash equivalents $33,376 $20,889 Restricted cash 10,024 9,209 Accounts receivable, net of allowance of $838 and $1,486, respectively 147,292 132,306 Income tax receivable 1,293 32,662 Prepaid expenses and other current assets 17,664 18,726 Assets held for sale under contract 23,912 24,895 Total current assets 233,561 238,687 Property and equipment, net 1,578,544 1,615,130 Investment in direct financing lease -- 23,808 Assets held for sale 46,429 138,622 Goodwill 105,905 109,006 Other assets 36,265 51,739 Total assets $2,000,704 $2,176,992 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable and accrued expenses $198,994 $243,312 Income tax payable 8,824 8,437 Distributions payable 15,865 9,156 Current portion of long-term debt 286,528 14,594 Total current liabilities 510,211 275,499 Long-term debt, net of current portion 708,392 1,137,976 Deferred tax liabilities 58,426 56,450 Fair value of interest rate swap agreement 15,084 -- Other liabilities 19,329 19,052 Total liabilities 1,311,442 1,488,977 Commitments and contingencies Preferred stock - $0.01 par value; 50,000 shares authorized: Series A - 4,300 shares issued and outstanding; stated at liquidation preference of $25.00 per share 107,500 107,500 Series B - 3,828 and 3,297 shares issued and outstanding at September 30, 2001 and December 31, 2000, respectively; stated at liquidation preference of $24.46 per share 93,622 80,642 Common stock - $0.01 par value; 80,000 and 400,000 shares authorized; 25,133 and 235,395 shares issued and 25,132 and 235,383 shares outstanding at September 30,2001 and December 31, 2000, respectively 251 2,354 Additional paid-in capital 1,314,092 1,299,390 Deferred compensation (3,644) (2,723) Retained deficit (819,178) (798,906) Treasury stock, 1.2 shares and 12 shares, respectively, at cost (242) (242) Accumulated other comprehensive loss (3,139) -- Total stockholders' equity 689,262 688,015 Total liabilities and stockholders' equity $2,000,704 $2,176,992 CORRECTIONS CORPORATION OF AMERICA AND SUBSIDIARIES (FORMERLY PRISON REALTY TRUST, INC.) CONDENSED COMBINED AND CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Consolidated Combined Consolidated Combined Three Months Three Months Nine Months Nine Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2001 2000 2001 2000 REVENUE: Management and other $247,072 $26,066 $728,981 $26,066 Rental 1,116 15,464 5,314 38,390 Licensing fees from affiliates -- 2,324 -- 7,566 248,188 43,854 734,295 72,022 EXPENSES: Operating 189,552 21,691 563,388 21,691 General and administrative 8,431 9,024 25,465 43,764 Lease -- 256 -- 256 Depreciation and amortization 14,211 15,439 40,088 41,770 Licensing fees to Operating Company -- 501 -- 501 Administrative service fee to Operating Company -- 900 -- 900 Write-off of amounts under lease arrangements -- 3,504 -- 11,920 Impairment loss -- 19,239 -- 19,239 212,194 70,554 628,941 140,041 OPERATING INCOME (LOSS) 35,994 (26,700) 105,354 (68,019) OTHER (INCOME) EXPENSE: Equity loss and amortization of deferred gain, net 90 9,135 265 13,392 Interest expense, net 29,637 35,741 96,752 95,490 Other income -- (3,099) -- (3,099) Change in fair value of interest rate swap agreement 5,649 -- 11,945 -- Loss on disposal of assets 180 3,023 141 3,324 Unrealized foreign currency transaction (gain) loss (215) 2,012 129 9,542 Stockholder litigation settlements -- 75,406 -- 75,406 35,341 122,218 109,232 194,055 INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTEREST 653 (148,918) (3,878) (262,074) Income tax expense (1,217) (109,888) (1,479) (109,888) LOSS BEFORE MINORITY INTEREST (564) (258,806) (5,357) (371,962) Minority interest in net loss of PMSI and JJFMSI -- 318 -- 318 NET LOSS (564) (258,488) (5,357) (371,644) Distributions to preferred stockholders (5,114) (2,585) (14,915) (6,885) NET LOSS AVAILABLE TO COMMON STOCKHOLDERS $(5,678) $(261,073) $(20,272) $(378,529) BASIC AND DILUTED NET LOSS AVAILABLE TO COMMON STOCKHOLDERS PER COMMON SHARE $(0.23) $(22.04) $(0.84) $(31.96) WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, BASIC AND DILUTED 24,749 11,846 24,215 11,842 MAKE YOUR OPINION COUNT - Click Here http://tbutton.prnewswire.com/prn/11690X47261942
SOURCE Corrections Corporation of America
Karin Demler of Corrections Corporation of America,
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