CCA's Latest Financials: Read 'Em and Weep

Corrections Corporation of America has announced their financial successes from the second quarter of 2007. The report is astonishing in its volume: CCA now has close to 75,000 prison beds in operation, drawing profits in on over 6 million "person days" of other people's lives. They pulled in over $360 million in revenue in this three-month period, compared to $323 million for the same period one year ago.

Here are some "highlights" direct from their press statement:

• "Federal revenues were positively impacted by a new management contract from ICE at our Stewart Detention Center that began receiving detainees in October 2006 and a full quarter impact of a new management contract at our T. Don Hutto Residential Center that became effective in May 2006."

Hutto: that would be the Texas prison holding children for about $5,400 per child per month (estimate from Daily Texan).

• "Total portfolio occupancy increased to 99.0% during the second quarter of 2007"

That would be because some prisons are below capacity, while others are overcrowded with people to maximize their profitability.

• "Fixed expenses per compensated man-day decreased to $28.10 during the second quarter of 2007 compared with $28.15 per compensated man-day during the same period in 2006, a decrease of $0.05 per compensated man-day. The decrease in fixed expenses per compensated man-day was primarily the result of leveraging our fixed expenses over a higher inmate population, partially offset by start-up costs at our Saguaro facility."

That means that they are spending less (on average) than the previous year incarcerating people. They're spending an average of $28 per day per person locked up in base expenses, which they lowered by cramming more people into existing prisons.

• "Variable expenses increased to $10.25 per compensated man-day during the second quarter of 2007 from $9.91 per compensated man-day during the second quarter of 2006, an increase of $0.34 per compensated man-day. The increase in variable expenses per compensated man-day was primarily attributable to an increase in inmate medical expenses due to an increase in offsite medical care at select facilities, as well as general inflationary increases."

But then there are other pesky expenses that have to be factored in before CCA can count the profits... expenses like medical costs for prisoners. Those costs increased compared to the same time period last year... reducing profits.

• "Total revenue for the second quarter of 2007 increased 11.7% to $362.8 million from $324.9 million during the same period in 2006, as total compensated man-days increased to 6.6 million from 6.1 million, and as revenue per compensated man-day increased to $54.08 from $52.55."

Remember those expenses per day per person? They totaled just over $38 per day on average. But CCA was able to charge an average about $54 per day per person. Multiply that charge by just over 6.6 million "person-days" and you get their operating revenue for the quarter: over $360 million dollars.

On the Texas front, CCA is still reporting plans to expand the Eden Detention Facility by 129 beds by early 2008. This is part of a package of almost 8,000 prison beds that CCA has in development. Development plans that they hope will bring even more profits in the future. But, these future predictions come with some caveats:

• "This press release contains statements as to our beliefs and expectations of the outcome of future events that are forward-looking statements... These forward-looking statements are subject to risks and uncertainties... [including] ... the public acceptance of our services... "

On that point, CCA and I agree.

Reminder: You can see the locations of CCA's Texas prisons on our Texas private prison map (they're the ones in dark green.)