Prison Realty Reports First Post Merger Quarter
Prison Realty Reports First Post Merger Quarter
May 5, 1999
NASHVILLE, Tenn., May 5 /PRNewswire/ -- Prison Realty Corporation ("Prison Realty" or the "Company") (NYSE: PZN), a Maryland corporation and the successor entity of the merger between CCA Prison Realty Trust and Corrections Corporation of America consummated January 1, 1999, today announced first quarter 1999 results. Funds from operations (FFO) of $68.4 million, or $0.63 per diluted share were earned on revenues of $72.0 million for the quarter ended March 31, 1999. Chairman and CEO Doctor R. Crants commented on results as follows: "We are pleased to announce our first quarter of operations following our merger at a level in line with expectations. In the few short months since January 1, 1999, we have been busy exploiting the advantages of our new structure to execute our business plan. We have announced 7,000 beds of new construction and acquisition and we have raised over $140 million in equity. We are prepared to continue our aggressive development of prison facilities to meet the burgeoning demands of government. Our size and capital structure substantially enhance our competitive position and will allow us to optimize shareholder value." Prison Realty's business is the ownership of correctional and detention facilities. The Company provides financing, design, construction and renovation of new and existing jails and prisons that it leases to both private and governmental managers. Prison Realty currently owns 50 correctional and detention facilities in 17 states, the District of Columbia and the United Kingdom having a total design capacity in excess of 49,000 beds, of which eleven new facilities are under construction. Prison Realty Corporation is based in Nashville, Tennessee and plans to qualify as a real estate investment trust under the Internal Revenue Code. A private prison management company and two other private management companies formed in conjunction with the merger now operate under the name of Corrections Corporation of America to provide management services to governments under contracts for 81 correctional and detention facilities with a total design capacity of 71,851 beds, of which 67 facilities with a total design capacity of 50,005 beds are in operation. This press release contains forward-looking statements that involve various risks and uncertainties. Actual results could differ materially from those contained in these forward-looking statements due to certain factors. These and other risks and uncertainties are detailed in the Company's reports filed with the SEC. PRISON REALTY CORPORATION Consolidated Statement of Income For the Three Months Ended March 31, 1999 (Unaudited and amounts in thousands, except per share amounts) 1999 REVENUES Rental revenue $ 63,640 Interest income 6,214 Licensing fees 2,132 71,986 EXPENSES: General and administrative 882 Depreciation and amortization 9,917 Interest expense 8,273 19,072 OPERATING INCOME 52,914 Equity in earnings of subsidiaries and amortization of deferred gains 7,681 INCOME BEFORE INCOME TAXES 60,595 Write off of deferred tax asset 83,200 (a) NET LOSS (22,605) Dividends to preferred shareholders (2,150) NET LOSS AVAILABLE FOR COMMON SHARES $(24,755) NET LOSS AVAILABLE PER COMMON SHARE: Basic $ (0.23) Diluted $ (0.23) WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, BASIC 107,282 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, DILUTED 107,282 FUNDS FROM OPERATIONS: Net Loss Available for Common Shares $(24,755) Plus Real Estate Depreciation 9,917 Add back non-recurring items: Write off of deferred tax asset 83,200 $ 68,362 FUNDS FROM OPERATIONS PER COMMON SHARE: Basic $ 0.64 Diluted $ 0.63 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, BASIC 107,282 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING, DILUTED 110,341 (a) - One-time charge related to change of Company tax status from C-corporation to REIT. PRISON REALTY CORPORATION Consolidated Balance Sheet March 31, 1999 (Amounts in thousands) (unaudited) March 31, 1999 ASSETS Current Assets: Cash and cash equivalents $ 11,324 Restricted cash 91,581 Accounts receivable, net of allowances 1,314 Prepaid expenses 645 Other current assets 15,496 Total current assets 120,360 Property and Equipment, Net 2,011,827 Other Assets: Notes receivable 138,549 Investments in affiliates and others 132,703 Investments in direct financing leases 72,881 Other 18,125 TOTAL ASSETS $2,494,445 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $ 94,271 Income taxes payable 8,197 Other accrued expenses 13,385 Distributions payable 221,505 Current portion of long-term debt 3,203 Current portion of deferred gains on sales of contracts 10,677 Total current liabilities 351,238 Long-Term Liabilities: Long-term debt, net of current portion 687,577 Deferred tax liability 32,000 Deferred gains on sales of contracts, net of current portion 102,212 TOTAL LIABILITIES 1,173,027 Commitments and Contingencies -- Stockholders' Equity: Preferred stock, $.01 par value; 10,000 shares authorized; 4,300 outstanding, 43 Common stock, $.01 par value; 300,000 shares authorized, 114,391 shares issued and outstanding 1,144 Additional paid-in capital 1,323,959 Cumulative net income 60,595 Accumulated distributions (64,323) TOTAL STOCKHOLDERS' EQUITY 1,321,418 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $2,494,445