wannamae
05-25-2005, 02:46 PM
http://tennessean.com/business/archives/05/03/69170123.shtml?Element_ID=69170123
CCA wary of high court ruling's fallout
By ROSE FRENCH
Associated Press
A U.S. Supreme Court ruling affecting federal sentencing guidelines could hinder long-term prospects for private prison operator Corrections Corporation of America, which reported a first-quarter loss yesterday.
In addition to declining inmate populations at CCA facilities in the first quarter, the nation's largest private prison operator also said in an SEC filing Wednesday that business may take a hit after the Supreme Court declared in January that federal sentencing guidelines — previously considered mandatory — are unconstitutional.
''Although it is too early to predict the impact, if any, on our business, the ruling could lead to federal sentences becoming more varied which could lead to a reduction in the length of sentences at correctional facilities,'' the SEC filing stated.
Yesterday, Nashville-based CCA said it had a net loss of $8.9 million, or 24 cents a share, compared with a profit of $14.4 million, or 37 cents per share, in the same period last year.
Refinancing transactions completed during the first quarter included a pretax charge of $35 million. Excluding the special charge, earnings amounted to 35 cents per share. Analysts surveyed by Thomson Financial had been expecting 33 cents per share.
Total revenue for the quarter increased to $285.9 million, from $276.8 million for the same period last year. Operating income was $38.6 million, compared with $42.6 million a year ago.
''Earnings were impacted by a reduction of inmate populations at several facilities,'' said John Ferguson, CCA president and chief executive.
CCA shares fell 64 cents to $37.26.
Despite total compensated man-days increasing slightly from 5.5 million to 5.6 million, CCA reported average occupancy for the quarter decreased to 89.4%, from 95.6% in the first quarter of 2004.
Also affecting the occupancy for the quarter was the addition of 2,500 beds at seven of the company's facilities.
Inmate populations fell at some of the company's facilities, including its Prairie Correctional Facility and Central Arizona Detention Center, and at several managed-only facilities, including the Bay County Jail in Florida and Metro-Davidson County Detention center in Nashville. Irving Lingo Jr., chief financial officer for CCA, said the company would not disclose exactly how much inmate populations fell.
During a conference call yesterday, Lingo and other company executives said CCA had several potential contracts on the horizon to fill about 7,500 current bed vacancies.
The company operates 64 facilities, including 39 company-owned lockups, with a total capacity of 70,000 beds in 19 states and the District of Columbia.
CCA wary of high court ruling's fallout
By ROSE FRENCH
Associated Press
A U.S. Supreme Court ruling affecting federal sentencing guidelines could hinder long-term prospects for private prison operator Corrections Corporation of America, which reported a first-quarter loss yesterday.
In addition to declining inmate populations at CCA facilities in the first quarter, the nation's largest private prison operator also said in an SEC filing Wednesday that business may take a hit after the Supreme Court declared in January that federal sentencing guidelines — previously considered mandatory — are unconstitutional.
''Although it is too early to predict the impact, if any, on our business, the ruling could lead to federal sentences becoming more varied which could lead to a reduction in the length of sentences at correctional facilities,'' the SEC filing stated.
Yesterday, Nashville-based CCA said it had a net loss of $8.9 million, or 24 cents a share, compared with a profit of $14.4 million, or 37 cents per share, in the same period last year.
Refinancing transactions completed during the first quarter included a pretax charge of $35 million. Excluding the special charge, earnings amounted to 35 cents per share. Analysts surveyed by Thomson Financial had been expecting 33 cents per share.
Total revenue for the quarter increased to $285.9 million, from $276.8 million for the same period last year. Operating income was $38.6 million, compared with $42.6 million a year ago.
''Earnings were impacted by a reduction of inmate populations at several facilities,'' said John Ferguson, CCA president and chief executive.
CCA shares fell 64 cents to $37.26.
Despite total compensated man-days increasing slightly from 5.5 million to 5.6 million, CCA reported average occupancy for the quarter decreased to 89.4%, from 95.6% in the first quarter of 2004.
Also affecting the occupancy for the quarter was the addition of 2,500 beds at seven of the company's facilities.
Inmate populations fell at some of the company's facilities, including its Prairie Correctional Facility and Central Arizona Detention Center, and at several managed-only facilities, including the Bay County Jail in Florida and Metro-Davidson County Detention center in Nashville. Irving Lingo Jr., chief financial officer for CCA, said the company would not disclose exactly how much inmate populations fell.
During a conference call yesterday, Lingo and other company executives said CCA had several potential contracts on the horizon to fill about 7,500 current bed vacancies.
The company operates 64 facilities, including 39 company-owned lockups, with a total capacity of 70,000 beds in 19 states and the District of Columbia.