CoreCivic, Inc. (NYSE: CXW) (the Company)
announced today its financial results for the second quarter of
2022 and provided an update on several significant transactions,
including an increase in its share buyback program.
Damon T. Hininger, CoreCivic's President and Chief
Executive Officer, said, "We are pleased to have entered into an
agreement during the second quarter to sell our 1,978-bed McRae
Correctional Facility for a sale price of $130.0 million. This
sale, which is expected to close later in the third quarter, will
result in a gain on sale of $75.0 million to $80.0 million. The
sale price represents approximately $66,000 per bed which, when
used to approximate the value of our over 70,000 company-owned
correctional beds, indicates a real estate value in excess of $4
billion, demonstrating the value of our portfolio. Monetizing this
asset will generate additional liquidity, which we can use for
general corporate purposes, including for our share repurchase
program, which our board just increased to $225.0 million, and/or
for additional debt reduction.
Hininger continued, “Our second quarter operations
were affected by short-term earnings disruptions from transitioning
populations at our La Palma Correctional Center in Arizona from an
ICE population to an Arizona population, as a result of the
previously announced state contract award, and a challenging labor
market. Despite the short-term earnings disruption at the La Palma
facility that we expect to normalize in the first quarter of 2023,
we continue to make great strides in improving the position of our
balance sheet, and we were able to begin returning capital to
shareholders through our share repurchase authorization. We are
pleased with our operational and financial performance and are
confident in the long-term outlook for returning to earnings
growth."
Financial Highlights – Second Quarter 2022
- Total revenue of $456.7 million
- CoreCivic Safety revenue of $416.4
million
- CoreCivic Community revenue of $25.8
million
- CoreCivic Properties revenue of $14.5
million
- Net Income of $10.6 million
- Diluted earnings per share of $0.09
- Adjusted diluted EPS of $0.13
- Funds From Operations per diluted share of $0.28
- Normalized Funds From Operations per diluted share of
$0.34
- Adjusted EBITDA of $78.8 million
Second Quarter 2022 Financial Results Compared With
Second Quarter 2021
Net income in the second quarter of 2022 totaled
$10.6 million, or $0.09 per diluted share, compared with net income
in the second quarter of 2021 of $15.6 million, or $0.13 per
diluted share. Adjusted for special items, adjusted net income in
the second quarter of 2022 was $16.2 million, or $0.13 per diluted
share (Adjusted Diluted EPS), compared with adjusted net income in
the second quarter of 2021 of $31.1 million, or $0.25 per diluted
share. Special items for each period are presented in detail in the
calculation of Adjusted Diluted EPS in the Supplemental Financial
Information following the financial statements presented
herein. The decline in adjusted per share amounts was
primarily the result of transitioning to a new contract with the
state of Arizona at our 3,060-bed La Palma Correctional Center in
Arizona, the non-renewal of contracts in 2021 with the United
States Marshals Service (USMS) at the 1,033-bed Leavenworth
Detention Center in Kansas and the 600-bed West Tennessee Detention
Facility, and the expiration of a managed-only contract with Marion
County, Indiana at the Marion County Jail, which the County
replaced with a newly constructed facility. We have two remaining
direct contracts with the USMS expiring in 2023 and 2025, and we
will work with the USMS to enable it to continue to fulfill its
mission. Our renewal rate on owned and controlled facilities
remained high at 95% over the previous five years. We believe our
renewal rate on existing contracts remains high due to a variety of
reasons including the aged and constrained supply of available beds
within the U.S. correctional system, our ownership of the majority
of the beds we operate, and the cost effectiveness of the services
we provide.
Earnings before interest, taxes, depreciation and
amortization (EBITDA) was $71.1 million in the second quarter of
2022, compared with $82.1 million in the second quarter of 2021.
Adjusted EBITDA was $78.8 million in the second quarter of 2022,
compared with $101.7 million in the second quarter of 2021.
Adjusted EBITDA decreased from the prior year quarter primarily due
to the sale of five non-core properties in our Properties segment
and two under-utilized facilities in our Community segment, which
generated $4.4 million in Adjusted EBITDA in the second quarter of
2021, the aforementioned transition of offender populations at our
La Palma Correctional Center, which resulted in a reduction in
EBITDA of $10.8 million, and the aforementioned non-renewal of
contracts at three facilities that collectively resulted in a
reduction in EBITDA of $4.5 million from the second quarter of 2021
to the second quarter of 2022.
Funds From Operations (FFO) was $34.3 million, or
$0.28 per diluted share, in the second quarter of 2022, compared to
$11.4 million, or $0.09 per diluted share, in the second quarter of
2021. Normalized FFO, which excludes special items, was $40.7
million, or $0.34 per diluted share, in the second quarter of 2022,
compared with $56.0 million, or $0.46 per diluted share, in the
second quarter of 2021. Normalized FFO was negatively
impacted by the same factors that affected Adjusted EBITDA.
Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO,
and Normalized FFO, and, where appropriate, their corresponding per
share amounts, are measures calculated and presented on the basis
of methodologies other than in accordance with generally accepted
accounting principles (GAAP). Please refer to the Supplemental
Financial Information and related note following the financial
statements herein for further discussion and reconciliations of
these measures to net income, the most directly comparable GAAP
measure.
New Bank Credit Facility
On May 12, 2022, we entered into a Third Amended and Restated
Credit Agreement (New Bank Credit Facility) in an aggregate
principal amount of $350.0 million, consisting of a $100.0 million
Term Loan A and a revolving credit facility with a borrowing
capacity of $250.0 million, which remains undrawn. The New Bank
Credit Facility matures in May 2026 and replaced an existing
facility (Previous Bank Credit Facility), which was scheduled to
expire in April 2023. The interest rates applicable to
the New Bank Credit Facility are tiered based on the then-current
total leverage ratio. Based on our current total leverage ratio,
loans under the New Bank Credit Facility currently bear interest at
a base rate plus a margin of 2.25% or at the Bloomberg Short-Term
Bank Yield Index (BSBY) rate plus a margin of 3.25%. In connection
with obtaining the New Bank Credit Facility, we paid-down the
previous Term Loan A by $67.5 million, and recorded a charge of
$0.8 million for the write-off of deferred loan costs associated
with the Previous Bank Credit Facility.
Additional Debt Repayments
On May 19, 2022, we announced we voluntarily repaid the
remaining $124.1 million outstanding principal balance under our
Term Loan B, and satisfied all of our outstanding debt obligations
under the agreement. We did not incur any prepayment penalties in
connection with the repayment of the Term Loan B, which had a
scheduled maturity of December 18, 2024. In connection with the
prepayment, we recorded a charge of $6.0 million for the write-off
of deferred loan costs, original issue discount and fees and
expenses associated with the prepayment of the Term Loan B. The
prepayment was made in full with cash on hand.
During the second quarter of 2022, we also purchased an
additional $3.6 million of our 4.625% Senior Notes at a weighted
average price approximately equal to par in open market purchases,
reducing the outstanding balance of the 4.625% Senior Notes to
$170.1 million.
Share Repurchases
On August 2, 2022, our Board of Directors authorized an increase
in our share repurchase program of up to an additional $75.0
million in shares of our common stock. As a result of the increased
authorization, the aggregate authorization under our share
repurchase program increased from the original authorization of up
to $150.0 million in shares of our common stock to up to $225.0
million shares of our common stock. Since May 16, 2022 through
August 1, 2022, we have repurchased 4.2 million shares of our
common stock at an aggregate purchase price of $50.6 million,
excluding fees, commissions and other costs related to
repurchases.
We currently have approximately $174.4 million remaining under
the Board authorized share repurchase plan. Additional repurchases
of common stock will be made in accordance with applicable
securities laws and may be made at management’s discretion within
parameters set by the Board of Directors from time to time in the
open market, through privately negotiated transactions, or
otherwise. The share repurchase program has no time limit and does
not obligate us to purchase any particular amount of our common
stock. The authorization for the share repurchase program may be
terminated, suspended, increased or decreased by our Board in its
discretion at any time.
Business Updates
Asset Sales. On July 25, 2022, we entered into
a Purchase & Sale Agreement with the Georgia Building Authority
to purchase our 1,978-bed McRae Correctional Facility in McRae,
Georgia for a price of $130.0 million. We currently have a
management contract with the Federal Bureau of Prisons (BOP) at the
McRae Facility, which expires November 30, 2022. As
previously disclosed, we do not expect the contract at the McRae
facility to be renewed upon its expiration. We also entered
into an agreement to lease the McRae facility from the Georgia
Building Authority through November 30, 2022. We expect the sale,
which is subject to customary closing conditions, to be completed
during the third quarter of 2022. On July 19, 2022, we completed
the sale of our Stockton Female Community Corrections Facility and
our Long Beach Community Corrections Center, both located in
California, to a third-party that resulted in net sales proceeds of
$10.9 million. On July 20, 2022, we also completed the sale of an
undeveloped parcel of land in California that resulted in net sales
proceeds of $4.8 million.
We currently intend to use the net proceeds from the sales for
general corporate purposes, which may include making repurchases
under our share repurchase plan and/or reducing our outstanding
indebtedness.
CoreCivic Safety and Community Contract
Renewals. During the second quarter of 2022, we
successfully renewed contracts with multiple government
partners:
- A local government agency exercised a two-year renewal option
at our 2,672-bed Tallahatchie County Correctional Facility in
Tutwiler, Mississippi, that allows the USMS to continue utilizing
available capacity, extending the contract until June 30, 2024.
This contract also has an indefinite number of two-year renewal
options.
- The BOP provided notice of its intent to renew our contract for
residential reentry and home confinement services at our 60-bed
South Raleigh Reentry Center in Raleigh, North Carolina.
- The BOP provided notice of its intent to renew our contract for
residential reentry and home confinement services at our 84-bed
James River Residential Reentry Center and 36-bed Ghent Residential
Reentry Center in the State of Virginia.
- The Colorado Department of Public Safety notified us of its
intent to award a contract to provide intensive residential
treatment and sex offender supervision and treatment services
across five of our residential reentry facilities located in the
state.
- The City of Mesa, Arizona renewed our contract to house
approximately 120 inmates at our 4,128-bed Central Arizona Florence
Correctional Complex in Florence, Arizona.
2022 Financial Guidance
Based on current business conditions, the Company is providing
the following update to its financial guidance for the full year
2022:
|
GuidanceFull Year 2022 |
Prior GuidanceFull Year 2022 |
|
$106.6 million - $118.2 million |
$77.1 million - $94.4 million |
|
$52.0 million - $60.0 million |
$75.5 million - $92.8 million |
|
$0.89 - $0.99 |
$0.64 - $0.79 |
|
$0.44 - $0.50 |
$0.63 - $0.77 |
|
$1.19 - $1.26 |
$1.45 - $1.60 |
- Normalized FFO per diluted share
|
$1.25 - $1.32 |
$1.45 - $1.60 |
|
$375.2 million - $386.2 million |
$336.1 million - $351.4 million |
|
$299.0 million - $305.0 million |
$333.9 million - $349.1 million |
Our updated 2022 guidance reflects a delay in the reversal of
Title 42, a public health order that has been used since March 2020
to deny entry at the United States southern border to
asylum-seekers and anyone crossing the southern border without
proper documentation or authority in an effort to contain the
spread of COVID-19. On April 1, 2022, the Center for Disease
Control and Prevention terminated Title 42 with an effective date
of May 23, 2022. However, on April 25, 2022, a federal judge issued
a temporary restraining order blocking its termination, and on May
20, 2022, ruled that the administration violated administrative law
when it announced that it planned to cease Title 42. That ruling is
under appeal with a decision unlikely before the first quarter of
2023. The termination of Title 42 is expected to result
in an increase in the number of undocumented people permitted into
the United States to claim asylum, and could result in an increase
in the number of people apprehended and detained by ICE, our
largest government customer. However, it is difficult to predict
when Title 42 will be terminated. Our prior guidance
anticipated higher occupancy levels from ICE from the potential
termination of Title 42, which is no longer contemplated in our
current guidance.
Our updated 2022 guidance also reflects a larger earnings
disruption at our La Palma Correctional Center than previously
estimated. During the second quarter of 2022, we agreed with the
state of Arizona to extend the transition period from the fourth
quarter of 2022 to the first quarter of 2023. However, we still
expect the final ICE detainees to be transferred out of the La
Palma facility during the third quarter of 2022. Our
2022 guidance also reflects the continuation of a challenging labor
market, including above average wage inflation.
During 2022, we expect to invest $79.5 million to $84.0 million
in capital expenditures, consisting of $33.5 million to $34.0
million in maintenance capital expenditures on real estate assets,
$30.0 million to $32.0 million for capital expenditures on other
assets and information technology, and $16.0 million to $18.0
million for facility renovations.
Supplemental Financial Information and Investor
Presentations
We have made available on our website supplemental financial
information and other data for the second quarter of
2022. Interested parties may access this information
through our website at http://ir.corecivic.com/ under “Financial
Information” of the Investors section. We do not
undertake any obligation and disclaim any duties to update any of
the information disclosed in this report.
Management may meet with investors from time to
time during the third quarter of 2022. Written
materials used in the investor presentations will also be available
on our website beginning on or about August 12, 2022.
Interested parties may access this information through our website
at http://ir.corecivic.com/ under “Events & Presentations” of
the Investors section.
Conference Call, Webcast and Replay
Information
We will host a webcast conference call at 10:00 a.m. central
time (11:00 a.m. eastern time) on Wednesday, August 3, 2022, and
will be accessible through the Company's website at
www.corecivic.com under the “Events & Presentations” section of
the "Investors" page. The live broadcast can also be accessed by
dialing 888-221-3881 in the U.S. and Canada, including the
confirmation passcode 8733680. An online replay of the call will be
archived on our website promptly following the conference call. In
addition, there will be a telephonic replay available beginning at
1:15 p.m. central time (2:15 p.m. eastern time) on August 3, 2022,
through 1:15 p.m. central time (2:15 p.m. eastern time) on August
11, 2022. To access the telephonic replay, dial 888-203-1112 in the
U.S. and Canada. International callers may dial +1 719-457-0820 and
enter passcode 8733680.
About CoreCivic
CoreCivic is a diversified, government-solutions company with
the scale and experience needed to solve tough government
challenges in flexible, cost-effective ways. We provide a broad
range of solutions to government partners that serve the public
good through high-quality corrections and detention management, a
network of residential and non-residential alternatives to
incarceration to help address America’s recidivism crisis, and
government real estate solutions. We are the nation’s largest owner
of partnership correctional, detention and residential reentry
facilities, and believe we are the largest private owner of real
estate used by government agencies in the United States. We have
been a flexible and dependable partner for government for nearly 40
years. Our employees are driven by a deep sense of service, high
standards of professionalism and a responsibility to help
government better the public good. Learn more at
www.corecivic.com.
Forward-Looking Statements
This press release contains statements as to our beliefs and
expectations of the outcome of future events that are
"forward-looking" statements within the meaning of Section 21E of
the Securities Exchange Act of 1934, as amended, and the Private
Securities Litigation Reform Act of 1995, as amended. These
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from the
statements made. These include, but are not limited to, the risks
and uncertainties associated with: (i) changes in government
policy (including the United States Department of Justice, or DOJ,
not renewing contracts as a result of President Biden's Executive
Order on Reforming Our Incarceration System to Eliminate the Use of
Privately Operated Criminal Detention Facilities, or the Private
Prison EO) (two agencies of the DOJ, the United States Federal
Bureau of Prisons and the United States Marshals Service utilize
our services), legislation and regulations that affect utilization
of the private sector for corrections, detention, and residential
reentry services, in general, or our business, in particular,
including, but not limited to, the continued utilization of our
correctional and detention facilities by the federal government,
and the impact of any changes to immigration reform and sentencing
laws (our company does not, under longstanding policy, lobby for or
against policies or legislation that would determine the basis for,
or duration of, an individual’s incarceration or detention); (ii)
our ability to obtain and maintain correctional, detention, and
residential reentry facility management contracts because of
reasons including, but not limited to, sufficient governmental
appropriations, contract compliance, negative publicity and effects
of inmate disturbances; (iii) changes in the privatization of
the corrections and detention industry, the acceptance of our
services, the timing of the opening of new facilities and the
commencement of new management contracts (including the extent and
pace at which new contracts are utilized), as well as our ability
to utilize available beds; (iv) general economic and market
conditions, including, but not limited to, the impact governmental
budgets can have on our contract renewals and renegotiations, per
diem rates, and occupancy; (v) fluctuations in our operating
results because of, among other things, changes in occupancy
levels; competition; contract renegotiations or terminations;
inflation and other increases in costs of operations, including a
continuing rise in labor costs; fluctuations in interest rates and
risks of operations; (vi) the duration of the federal
government’s denial of entry at the United States southern border
to asylum-seekers and anyone crossing the southern border without
proper documentation or authority in an effort to contain the
spread of COVID-19, a policy known as Title 42 (On April 1,
2022, the Center for Disease Control and Prevention, or CDC,
terminated Title 42, and began preparing for a resumption of
regular migration at the United States southern border, effective
May 23, 2022; however, on April 25, 2022, a judge issued a
temporary restraining order blocking the termination of Title 42
and on May 20, 2022, ruled that the administration violated
administrative law when it announced that it planned to cease Title
42.); (vii) government and staff responses to staff or
residents testing positive for COVID-19 within public and
private correctional, detention and reentry facilities, including
the facilities we operate; (viii) restrictions associated
with COVID-19 that disrupt the criminal justice system, along with
government policies on prosecutions and newly ordered legal
restrictions that affect the number of people placed in
correctional, detention, and reentry facilities, including those
associated with a resurgence of COVID-19; (ix) whether revoking our
REIT election, effective January 1, 2021, and our revised capital
allocation strategy can be implemented in a cost effective manner
that provides the expected benefits, including facilitating our
planned debt reduction initiative and planned return of capital to
shareholders; (x) our ability to successfully identify and
consummate future development and acquisition opportunities and
realize projected returns resulting therefrom; (xi) our ability to
have met and maintained qualification for taxation as a REIT for
the years we elected REIT status; and (xii) the availability of
debt and equity financing on terms that are favorable to us, or at
all. Other factors that could cause operating and financial results
to differ are described in the filings we make from time to time
with the Securities and Exchange Commission.
CoreCivic takes no responsibility for updating the information
contained in this press release following the date hereof to
reflect events or circumstances occurring after the date hereof or
the occurrence of unanticipated events or for any changes or
modifications made to this press release or the information
contained herein by any third-parties, including, but not limited
to, any wire or internet services.
CORECIVIC, INC. AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
ASSETS |
|
June 30,2022 |
|
December 31,2021 |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
115,611 |
|
|
$ |
299,645 |
|
Restricted cash |
|
|
11,794 |
|
|
|
11,062 |
|
Accounts receivable, net of
credit loss reserve of $8,946 and $7,931,
respectively |
|
|
273,839 |
|
|
|
282,809 |
|
Prepaid expenses and other
current assets |
|
|
42,413 |
|
|
|
26,872 |
|
Assets held for sale |
|
|
61,587 |
|
|
|
6,996 |
|
Total current assets |
|
|
505,244 |
|
|
|
627,384 |
|
Real estate and related
assets: |
|
|
|
|
Property and equipment, net of accumulated depreciation of
$1,671,088 and $1,657,709, respectively |
|
|
2,197,463 |
|
|
|
2,283,256 |
|
Other real estate assets |
|
|
213,164 |
|
|
|
218,915 |
|
Goodwill |
|
|
4,844 |
|
|
|
4,844 |
|
Other assets |
|
|
355,815 |
|
|
|
364,539 |
|
|
|
|
|
|
Total assets |
|
$ |
3,276,530 |
|
|
$ |
3,498,938 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
Accounts payable and accrued
expenses |
|
$ |
294,435 |
|
|
$ |
305,592 |
|
Current portion of long-term
debt |
|
|
180,378 |
|
|
|
35,376 |
|
Total current liabilities |
|
|
474,813 |
|
|
|
340,968 |
|
|
|
|
|
|
Long-term debt, net |
|
|
1,148,679 |
|
|
|
1,492,046 |
|
Deferred revenue |
|
|
25,070 |
|
|
|
27,551 |
|
Non-current deferred tax
liabilities |
|
|
91,828 |
|
|
|
88,157 |
|
Other liabilities |
|
|
167,200 |
|
|
|
177,748 |
|
|
|
|
|
|
Total liabilities |
|
|
1,907,590 |
|
|
|
2,126,470 |
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
Preferred stock ― $0.01 par value; 50,000 shares authorized; none
issued and outstanding at June 30, 2022, and December 31, 2021,
respectively |
|
|
- |
|
|
|
- |
|
Common stock ― $0.01 par value; 300,000 shares authorized; 118,620
and 120,285 shares issued and outstanding at June 30, 2022, and
December 31, 2021, respectively |
|
|
1,186 |
|
|
|
1,203 |
|
Additional paid-in
capital |
|
|
1,836,949 |
|
|
|
1,869,955 |
|
Accumulated deficit |
|
|
(469,195 |
) |
|
|
(498,690 |
) |
Total stockholders’
equity |
|
|
1,368,940 |
|
|
|
1,372,468 |
|
|
|
|
|
|
Total liabilities and
stockholders' equity |
|
$ |
3,276,530 |
|
|
$ |
3,498,938 |
|
|
|
|
|
|
|
|
|
|
CORECIVIC, INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF
OPERATIONS(UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
|
For the Three Months EndedJune
30, |
|
2022 |
|
2021 |
|
|
|
|
REVENUE: |
|
|
|
Safety |
$ |
416,354 |
|
|
$ |
419,880 |
|
Community |
|
25,775 |
|
|
|
24,929 |
|
Properties |
|
14,526 |
|
|
|
19,732 |
|
Other |
|
42 |
|
|
|
30 |
|
|
|
456,697 |
|
|
|
464,571 |
|
|
|
|
|
EXPENSES: |
|
|
|
Operating |
|
|
|
Safety |
|
324,261 |
|
|
|
307,280 |
|
Community |
|
21,282 |
|
|
|
20,024 |
|
Properties |
|
3,377 |
|
|
|
5,668 |
|
Other |
|
80 |
|
|
|
98 |
|
Total operating expenses |
|
349,000 |
|
|
|
333,070 |
|
General and administrative |
|
31,513 |
|
|
|
33,228 |
|
Depreciation and amortization |
|
32,259 |
|
|
|
34,084 |
|
Shareholder litigation expense |
|
1,900 |
|
|
|
2,550 |
|
Asset impairments |
|
- |
|
|
|
2,866 |
|
|
|
414,672 |
|
|
|
405,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE): |
|
|
|
Interest expense, net |
|
(21,668 |
) |
|
|
(23,222 |
) |
Expenses associated with debt repayments and refinancing
transactions |
|
(6,805 |
) |
|
|
(52,167 |
) |
Gain on sale of real estate assets, net |
|
1,060 |
|
|
|
38,766 |
|
Other income (expense) |
|
(37 |
) |
|
|
(8 |
) |
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME
TAXES |
|
14,575 |
|
|
|
22,142 |
|
|
|
|
|
Income tax expense |
|
(4,013 |
) |
|
|
(6,519 |
) |
NET INCOME |
$ |
10,562 |
|
|
$ |
15,623 |
|
|
|
|
|
|
|
|
|
BASIC EARNINGS PER
SHARE |
$ |
0.09 |
|
|
$ |
0.13 |
|
|
|
|
|
DILUTED EARNINGS PER
SHARE |
$ |
0.09 |
|
|
$ |
0.13 |
|
|
|
|
|
|
|
|
|
CORECIVIC, INC. AND
SUBSIDIARIESSUPPLEMENTAL FINANCIAL
INFORMATION (UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT
PER SHARE AMOUNTS)
CALCULATION OF ADJUSTED NET INCOME AND ADJUSTED DILUTED
EPS
|
For the Three Months EndedJune
30, |
|
2022 |
|
2021 |
|
|
|
|
Net income |
$ |
10,562 |
|
|
$ |
15,623 |
|
|
|
|
|
Special items: |
|
|
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
52,167 |
|
Expenses associated with COVID-19 |
|
- |
|
|
|
836 |
|
Gain on sale of real estate assets, net |
|
(1,060 |
) |
|
|
(38,766 |
) |
Shareholder litigation expense |
|
1,900 |
|
|
|
2,550 |
|
Asset impairments |
|
- |
|
|
|
2,866 |
|
Income tax benefit for special items |
|
(2,041 |
) |
|
|
(4,185 |
) |
Adjusted net income |
$ |
16,166 |
|
|
$ |
31,091 |
|
Weighted average common shares
outstanding – basic |
|
120,529 |
|
|
|
120,283 |
|
Effect of dilutive
securities: |
|
|
|
Restricted stock-based awards |
|
817 |
|
|
|
434 |
|
Non-controlling interest – operating partnership units |
|
- |
|
|
|
1,342 |
|
Weighted average shares and
assumed conversions - diluted |
|
121,346 |
|
|
|
122,059 |
|
Adjusted Earnings Per Diluted
Share |
$ |
0.13 |
|
|
$ |
0.25 |
|
|
|
|
|
|
|
|
|
CORECIVIC, INC. AND
SUBSIDIARIESSUPPLEMENTAL FINANCIAL
INFORMATION (UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT
PER SHARE AMOUNTS)
CALCULATION OF FUNDS FROM OPERATIONS AND NORMALIZED
FUNDS FROM OPERATIONS
|
For the Three Months EndedJune
30, |
|
2022 |
|
2021 |
|
|
|
|
Net income |
$ |
10,562 |
|
|
$ |
15,623 |
|
Depreciation and amortization of real estate assets |
|
24,501 |
|
|
|
24,926 |
|
Gain on sale of real estate assets, net |
|
(1,060 |
) |
|
|
(38,766 |
) |
Income tax expense for special
items |
|
283 |
|
|
|
9,641 |
|
Funds From Operations |
$ |
34,286 |
|
|
$ |
11,424 |
|
|
|
|
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
52,167 |
|
Expenses associated with COVID-19 |
|
- |
|
|
|
836 |
|
Income taxes associated with change in corporate tax structure and
other special tax items |
|
- |
|
|
|
- |
|
Shareholder litigation expense |
|
1,900 |
|
|
|
2,550 |
|
Goodwill and other impairments |
|
- |
|
|
|
2,866 |
|
Income tax benefit for special
items |
|
(2,324 |
) |
|
|
(13,826 |
) |
Normalized Funds From Operations |
$ |
40,667 |
|
|
$ |
56,017 |
|
|
|
|
|
Funds From Operations Per Diluted Share |
$ |
0.28 |
|
|
$ |
0.09 |
|
Normalized Funds From Operations Per Diluted Share |
$ |
0.34 |
|
|
$ |
0.46 |
|
|
|
|
|
|
|
|
|
CORECIVIC, INC. AND
SUBSIDIARIESSUPPLEMENTAL FINANCIAL
INFORMATION (UNAUDITED AND AMOUNTS IN THOUSANDS, EXCEPT
PER SHARE AMOUNTS)
CALCULATION OF EBITDA AND ADJUSTED EBITDA
|
For the Three Months EndedJune
30, |
|
2022 |
|
2021 |
|
|
|
|
Net income |
$ |
10,562 |
|
|
$ |
15,623 |
|
Interest expense |
|
24,292 |
|
|
|
25,843 |
|
Depreciation and
amortization |
|
32,259 |
|
|
|
34,084 |
|
Income tax expense |
|
4,013 |
|
|
|
6,519 |
|
EBITDA |
$ |
71,126 |
|
|
$ |
82,069 |
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
52,167 |
|
Expenses associated with COVID-19 |
|
- |
|
|
|
836 |
|
Gain on sale of real estate assets, net |
|
(1,060 |
) |
|
|
(38,766 |
) |
Shareholder litigation expense |
|
1,900 |
|
|
|
2,550 |
|
Asset impairments |
|
- |
|
|
|
2,866 |
|
Adjusted EBITDA |
$ |
78,771 |
|
|
$ |
101,722 |
|
|
|
|
|
|
|
|
|
GUIDANCE -- CALCULATION OF ADJUSTED NET INCOME, FUNDS
FROM OPERATIONS, EBITDA & ADJUSTED EBITDA
|
For the Year EndingDecember 31,
2022 |
|
Low End of Guidance |
|
High End of Guidance |
Net income |
$ |
106,610 |
|
|
$ |
118,235 |
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
6,805 |
|
Gain on sale of real estate assets, net |
|
(84,921 |
) |
|
|
(89,921 |
) |
Shareholder litigation expense |
|
1,900 |
|
|
|
1,900 |
|
Income tax expense for special items |
|
21,606 |
|
|
|
22,981 |
|
Adjusted net income |
$ |
52,000 |
|
|
$ |
60,000 |
|
|
|
|
|
Net income |
$ |
106,610 |
|
|
$ |
118,235 |
|
Depreciation and amortization of real estate assets |
|
97,000 |
|
|
|
97,500 |
|
Gain on sale of real estate assets, net |
|
(84,921 |
) |
|
|
(89,921 |
) |
Income tax expense for special items |
|
23,356 |
|
|
|
24,731 |
|
Funds From Operations |
$ |
142,045 |
|
|
$ |
150,545 |
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
6,805 |
|
Shareholder litigation expense |
|
1,900 |
|
|
|
1,900 |
|
Income tax expense for special items |
|
(1,750 |
) |
|
|
(1,750 |
) |
Normalized Funds From
Operations |
$ |
149,000 |
|
|
$ |
157,500 |
|
Diluted EPS |
$ |
0.89 |
|
|
$ |
0.99 |
|
Adjusted diluted EPS |
$ |
0.44 |
|
|
$ |
0.50 |
|
FFO per diluted share |
$ |
1.19 |
|
|
$ |
1.26 |
|
Normalized FFO per diluted
share |
$ |
1.25 |
|
|
$ |
1.32 |
|
|
|
|
|
Net income |
$ |
106,610 |
|
|
$ |
118,235 |
|
Interest expense |
|
98,000 |
|
|
|
97,000 |
|
Depreciation and
amortization |
|
128,000 |
|
|
|
128,000 |
|
Income tax expense |
|
42,606 |
|
|
|
42,981 |
|
EBITDA |
$ |
375,216 |
|
|
$ |
386,216 |
|
Expenses associated with debt repayments and refinancing
transactions |
|
6,805 |
|
|
|
6,805 |
|
Gain on sale of real estate assets, net |
|
(84,921 |
) |
|
|
(89,921 |
) |
Shareholder litigation expense |
|
1,900 |
|
|
|
1,900 |
|
Adjusted EBITDA |
$ |
299,000 |
|
|
$ |
305,000 |
|
|
|
|
|
|
|
|
|
NOTE TO SUPPLEMENTAL FINANCIAL INFORMATION
Adjusted Net Income, EBITDA, Adjusted EBITDA, FFO, and
Normalized FFO, and, where appropriate, their corresponding per
share metrics are non-GAAP financial measures. The Company believes
that these measures are important operating measures that
supplement discussion and analysis of the Company's results of
operations and are used to review and assess operating performance
of the Company and its properties and their management teams. The
Company believes that it is useful to provide investors, lenders
and security analysts disclosures of its results of operations on
the same basis that is used by management.
FFO, in particular, is a widely accepted non-GAAP supplemental
measure of performance of real estate companies, grounded in the
standards for FFO established by the National Association of Real
Estate Investment Trusts (NAREIT). NAREIT defines FFO
as net income computed in accordance with GAAP, excluding gains (or
losses) from sales of property and extraordinary items, plus
depreciation and amortization of real estate and impairment of
depreciable real estate and after adjustments for unconsolidated
partnerships and joint ventures calculated to reflect funds from
operations on the same basis. EBITDA, Adjusted EBITDA,
and Normalized FFO are useful as supplemental measures of
performance of the Company's properties because such measures do
not take into account depreciation and amortization, or with
respect to EBITDA, the impact of the Company's tax provisions and
financing strategies. Because the historical cost accounting
convention used for real estate assets requires depreciation
(except on land), this accounting presentation assumes that the
value of real estate assets diminishes at a level rate over
time. Because of the unique structure, design and use
of the Company's properties, management believes that assessing
performance of the Company's properties without the impact of
depreciation or amortization is useful. The Company may make
adjustments to FFO from time to time for certain other income and
expenses that it considers non-recurring, infrequent or unusual,
even though such items may require cash settlement, because such
items do not reflect a necessary or ordinary component of the
ongoing operations of the Company. Normalized FFO
excludes the effects of such items. The Company calculates Adjusted
Net Income by adding to GAAP Net Income expenses associated with
the Company’s debt repayments and refinancing transactions, and
certain impairments and other charges that the Company believes are
unusual or non-recurring to provide an alternative measure of
comparing operating performance for the periods presented.
Other companies may calculate Adjusted Net Income, EBITDA,
Adjusted EBITDA, FFO, and Normalized FFO differently than the
Company does, or adjust for other items, and therefore
comparability may be limited. Adjusted Net Income,
EBITDA, Adjusted EBITDA, FFO, and Normalized FFO and, where
appropriate, their corresponding per share measures are not
measures of performance under GAAP, and should not be considered as
an alternative to cash flows from operating activities, a measure
of liquidity or an alternative to net income as indicators of the
Company's operating performance or any other measure of performance
derived in accordance with GAAP. This data should be
read in conjunction with the Company's consolidated financial
statements and related notes included in its filings with the
Securities and Exchange Commission.
Contact: |
Investors: Cameron Hopewell - Managing Director, Investor Relations
- (615) 263-3024Financial Media: David Gutierrez, Dresner Corporate
Services - (312) 780-7204 |
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