Slide 1: Second Quarter 2017 Investor Presentation
Second Quarter 2017 Investor Presentation
Slide 2: Forward-Looking Statements
Forward-Looking Statements As defined within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, certain statements herein may be considered forward-looking statements that are subject to risks and uncertainties tha
Slide 3: About CoreCivic
About CoreCivic
Slide 4: Who We Are
Who We Are • Established in 1983, CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in cost-effective ways • We provide a broad range of solutions to government partners that serve the public good through three business
Slide 5: National Portfolio with Geographic Diversity
National Portfolio with Geographic Diversity As of June 30, 2017, we owned 74 real estate assets and provided correctional management services at 10 additional facilities owned by government partners CoreCivic Safety • 44 owned facilities, 64,064 beds • 10 managed-only facilities, 12,849 beds Co
Slide 6: CoreCivic Safety – A National Leader
CoreCivic Safety – A National Leader CoreCivic is the largest non-government owner of correctional and detention real estate in the United States We believe we own nearly 57% of all privately owned prison beds Approximately 40% larger than our nearest competitor Owned Correctional and Detention
Slide 7: CoreCivic Properties – Real Estate Solutions
CoreCivic Properties – Real Estate Solutions CoreCivic Properties offers a wide range of innovative, cost-saving government real estate solutions Deep expertise and experience • We believe we are the largest developer of mission-critical, criminal justice center real estate projects over the past
Slide 8: CoreCivic Community – A Growing Network
CoreCivic Community – A Growing Network CoreCivic Community is a rapidly growing network of residential reentry centers whose mission is to help address America's recidivism crisis. In the last 4 years CoreCivic Community expanded to be the second largest provider in the market CoreCivic Residenti
Slide 9: High Quality, Diverse Customer Base
High Quality, Diverse Customer Base As of June 30, 2017, CoreCivic had more than 100 agreements with federal, state and local agencies Further diversification within federal agency customers: • > 100 potential customers within federal agencies: 94 U.S. Marshals districts; 24 ICE field offices; and
Slide 10: Strong Balance Sheet and Cash Flow
Strong Balance Sheet and Cash Flow
Slide 11: Strong Balance Sheet and Simple Capital Structure
Strong Balance Sheet and Simple Capital Structure Our low cost of capital is a competitive advantage Debt Maturity Schedule $325M Sr. Notes @ 4.125%, due Apr. 2020 $1,000M $250M Sr. Notes @ 5.000%, due Oct. 2022 $796M $800M $350M Sr. Notes @ 4.625%, due May 2023 $900M Revolver @ LIBOR + 1.50
Slide 12: Balance Sheet Flexibility
Balance Sheet Flexibility • Current dividend policy pegged to ~80% of AFFO, or ~77% of Normalized FFO • Median FFO payout ratio for all equity REITs is 73%(1) • Abundant opportunities to deploy capital to grow and diversify cash flows, and to create shareholder value CoreCivic Community acquisitio
Slide 13: Proven Strategy for Growth
Proven Strategy for Growth We have consistently grown our real estate portfolio through various market cycles CoreCivic Safety operates over 64,000 company owned correctional and detention beds CoreCivic Community strategy began in 2013 – now represents over 4,700 beds CoreCivic Properties str
Slide 14: Historical Growth Driven by Real Estate Assets
Historical Growth Driven by Real Estate Assets Today, more than 96% of facility net operating income is derived from owned/controlled real estate assets(1) Owned and Managed facility net operating income increased from $155M in 2001 to $487M in 2016 Facility Net Operating Income By Contract Type
Slide 15: Business Development Update
Business Development Update
Slide 16: Recent Contract Awards
Recent Contract Awards 7/28/17 – The Federal Bureau of Prisons (BOP) exercises a two-year renewal option at our 2,232-bed Adams County Correctional Center 5/22/17 – City of Mesa, Arizona enters into new three-year contract to house up to 200 offenders at our 4,128-bed Central Arizona Florence Co
Slide 17: Actively Marketing Available Capacity
Actively Marketing Available Capacity As of June 30, 2017, we had eight idle prison facilities, totaling 9,720 beds, that we are actively marketing to potential government partners: Eden Detention Center (Texas)—1,422 beds Huerfano County Correctional Center (Colorado)—752 beds Kit Carson Corr
Slide 18: Residential Reentry Acquisition Summary
Residential Reentry Acquisition Summary State(s) of Acquisition Acquisition Date of Acquisition # of Facilities Operation # of Beds Price Correctional Alternatives, Inc. July 2013 2 California 603 $36.5m Pennsylvania Portfolio August 2015 4 Pennsylvania 605 $13.8m Oklahoma, Texas, Avalon Correctiona
Slide 19: Financial Guidance
Financial Guidance
Slide 20: 2017 Financial Guidance
2017 Financial Guidance(1) Q3 2017 Guidance Low-End High-End Diluted EPS $ 0.32 $ 0.33 Adjusted Diluted EPS(2) $ 0.33 $ 0.35 Normalized FFO per diluted share(2) $ 0.52 $ 0.54 AFFO per diluted share(2) $ 0.50 $ 0.52 Adjusted EBITDA(2) (in $ 000s) $ 90,200 $ 91,300 Full Year 2017 Guidance Low-End High
Slide 21: Appendix
Appendix
Slide 22: Utilizing Available Capacity Drives Earnings Growth
Utilizing Available Capacity Drives Earnings Growth Average Estimated Potential Annual Total Beds Available Margin(1) Incremental EBITDA Owned and Controlled Vacant Facility Capacity(2)(3) 9,720 $ 24.00 $ 85,147,200 Owned and Controlled beds at Facilities with > 100 beds available(4) 5,912 $ 24.00 5
Slide 23: Reconciliation to Adjusted Diluted EPS
Reconciliation to Adjusted Diluted EPS ($ in thousands, except per share amounts) For the Quarter Ended For the Six Months Ended June 30, June 30, 2017 2016 2017 2016 Net income $ 45,475 $ 57,583 $ 95,522 $ 103,890 Special items: Expenses associated with mergers and acquisitions 301 317 431 1,460 As
Slide 24: Calculation of FFO, Normalized FFO and AFFO
Calculation of FFO, Normalized FFO and AFFO ($ in thousands, except per share amounts) For the Quarter Ended For the Six Months Ended June 30, June 30, 2017 2016 2017 2016 Net income $ 45,475 $ 57,583 $ 95,522 $ 103,890 Depreciation of real estate assets 23,956 23,388 47,655 46,725 Funds From Operat
Slide 25: Calculation of NOI
Calculation of NOI ($ in thousands) For the Quarter Ended For the Six Months Ended June 30, June 30, 2017 2016 2017 2016 Revenue owned and controlled properties $ 384,874 $ 411,451 $ 779,470 $ 808,329 Operating expenses owned and controlled properties (257,766) (268,569) (522,636) (533,555) Net oper
Slide 26: Calculation of Historic Facility NOI
Calculation of Historic Facility NOI ($ in thousands) 2001 2002 2003 2004 2005 2006 2007 2008 2009 Owned & Managed (O&M) Facilities $ 155,260 $ 159,768 $ 209,263 $ 224,339 $ 242,014 $ 307,803 $ 373,078 $ 431,192 $ 462,974 Managed Only Facilities 51,880 53,896 51,307 54,024 54,401 50,612 48,593 50,12
Slide 27: Calculation of EBITDA and Adjusted EBITDA
Calculation of EBITDA and Adjusted EBITDA ($ in thousands) For the Quarter Ended For the Six Months Ended June 30, June 30, 2017 2016 2017 2016 Net income $ 45,475 $ 57,583 $ 95,522 $ 103,890 Interest expense, net 16,622 16,796 33,112 34,340 Depreciation and amortization 36,800 42,345 73,057 84,404
Slide 28: Reconciliation to 2017 Guidance
Reconciliation to 2017 Guidance ($ in thousands, except per share amounts) Third Quarter 2017 Full-Year 2017 Low High Low High Net income $ 37,500 $ 39,600 $ 177,200 $ 182,200 Expenses associated with mergers and acquisitions 400 400 1,500 1,500 Asset impairments 1,000 1,000 1,300 1,300 Adjusted net
Slide 29: CoreCivic
& coreCivic