CCA Third Quarter Profits Jump

AP Report
NASHVILLE, Tenn. — Prison operator Corrections Corp. of America said its third-quarter profit jumped 19 percent as more prisoners were locked up in its California and Arizona facilities.
The company said it earned $45.3 million in the quarter that ended Sept. 30, or 39 cents per share. That was up from $37.9 million, or 30 cents per share, during the same period last year.
Not counting an unusual tax benefit, the company would have earned 33 cents per share — above the 31 cents per share average expected by analysts surveyed by Thomson Reuters.
Revenue rose about 6 percent to $426 million from $403.8 million a year earlier, also topping analysts' $422.8 million forecast. The revenue increase was driven by a 4.5 percent rise in its average daily inmate population, plus a 1.3 percent increase in revenue for each person locked up one day.
Management revenue from states rose nearly 7 percent to $224.9 million as the inmate population from California and Arizona rose, partially offset by a drop in the number of prisoners in Minnesota and Washington.
The company said it expects a fourth-quarter profit of 33 cents to 35 cents per share, and a full-year profit of $1.24 to $1.26 per share, not counting special items. Analysts are expecting a profit of 34 cents per share for the fourth quarter and $1.25 per share for the year, on average.
The company said the general economy remains uncertain, and states — which pay the company to lock up their prisoners — are facing budget revenue shortfalls. It said its prediction includes the potential for additional pricing pressure, and the risk of population declines from some customers.
Corrections Corp. shares rose 33 cents to close earlier at $25.49, and slipped 68 cents, or 2.7 percent in late trading.