Friday, August 6, 2010

CCA raises profit forecast

Corrections Corporation of America on Wednesday reported a 12 percent increase in its second-quarter earnings and raised its full-year 2010 profit forecast.
Separately, the Nashville-based private prison company asked a federal judge to throw out a lawsuit over prison violence in Idaho, saying the inmates bringing the case didn't try to solve their problems through administrative channels before turning to the courts.

Second-quarter earnings were $36.6 million, or 32 cents a share for the recent quarter, up from $32.6 million, or 28 cents a share, a year ago. On average, analysts had projected 30 cents a share for the recent quarter that ended June 30.

CCA attributed a 1.6 percent increase in its total revenue (to $419 million) largely to a 2 percent increase in its average daily inmate populations. Management revenue from CCA's federal government partners rose 9.4 percent to $178 million, while management revenue from state governments fell 3.6 percent to $209 million.

Pleased with growth

Damon Hininger, chief executive of CCA, said he was pleased with year-over-year earnings growth amid a difficult business environment. CCA has roughly 12,500 unoccupied prison beds.

"Thus far, none of our state partners has appropriated new funding for prison construction under their fiscal year 2011 budget, which we continue to believe will result in absorption of our available beds, fueling our long-term growth," he said.

CCA raised its full-year profit forecast to between $1.26 per share and $1.30 a share.

Meanwhile, in the Idaho federal court case, the American Civil Liberties Union representing the inmates said the prisoners took all the necessary steps to address their grievances, and that CCA failed to fix problems at the Boise lock-up facility.

The inmates asked for class-action status in the lawsuit earlier this year, saying that the CCA-run Idaho Correctional Center is so violent that it's known as "gladiator school" and that prison workers used inmate-on-inmate violence as a management tool, then refused to provide X-rays to injured prisoners as part of an alleged cover-up.

CCA has denied the claims.

Getahn Ward can be reached at 615-736-5968 or at The Associated Press contributed to this story.

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