Corrections Corporation of America (CXW) said Thursday that it lost $4.5 million for the quarter ended June 30, 2001, down sharply from the loss of $6.89 per share in the year-earlier period. It also said that it agreed to pay $15 million to settle a lawsuit brought by the Blackstone Group and the Fortress Investment Group; this action arose when CCA terminated a restructuring agreement in 2000.
During the second quarter, the Nashville-based prison operator lost $4.5 million, or 18 cents a share. That was down from $10.1 million, or 43 cents a share, loss it reported in the first quarter. In the first quarter, the company took a $6.3 million charge for an interest rate swap.
CCA sold during the quarter correctional facilities in Bayboro, North Carolina and Salford, England for a total of $89.8 million. The proceeds were used to pay down senior debt. Also, the company used $35.0 million from working capital to further lower its debt load. By doing this, the company avoided a twenty-five basis point increase in interest rates. During the first half of the year, the company has paid off about $150 million in senior debt.
CCA closed two facilities, one in Youngstown, Ohio and another in Tutwiler, Mississippi. Both had been operating at a loss. It also dropped out of bidding on federal criminal alien contract because the Arizona facility it intended to use appears to be filling faster than anticipated.
"We are especially pleased with the operating results, particularly in light of the fact that EBITDA continues to increase despite the sale of several assets and the curtailment of some operations," John Ferguson, CCA president and chief executive, said in a release.
In early Thursday afternoon trading, CCA shares were up 34 cents to $14.19