Charges related to the refinancing of $715 million of debt resulted in a $31.4 million, or 96 cents a share, loss for Correction Corporation of America (CXW) in the second quarter ended June 30. Not counting the refinancing charges, the Nashville-based prison owner and operator would have made $5.3 million, or 20 cents a share.
The company’s chief challenge, raising occupancy in its prison beds, continued to be daunting as the occupancy rate slipped to 89.2% from 89.3% a year ago on a six-tenths of one percent decrease in the number of available beds. While revenue per compensated man-day edged higher, operating expenses on that basis rose a greater amount in percentage terms. As a result, CCA’s operating margin slipped to 22.8% from 22.9%.
Earnings before interest, taxes, depreciation and amortization (EBITDA) declined to $46.6 million from $48.1 million, however CCA Chief Executive John Ferguson said in a statement that “the company is now in a positive working capital position.”
Included in the $36.7 million refinancing charge were the “write-off of existing deferred loan costs, certain bank fees paid, premiums paid to redeem the 12% senior notes, and certain other costs associated with the refinancing.”
CCA shares settled Wednesday at $13.30. Their 52-week range is $11.69-$19.25.