CoreCivic(US:CXW)2020-05-07 21:15Financial Data and Key Metrics Changes - In Q1 2020, the company reported total revenue of $491 million, a 1.5% increase year-over-year, and normalized FFO per share of $0.54, exceeding the high end of guidance by $0.01 [27][35] - Adjusted EBITDA for the quarter was $100.4 million, surpassing the guidance range of $96 million to $99 million [35][36] - EPS was reported at $0.27, with adjusted EPS at $0.30, both above the guidance range [35] Business Line Data and Key Metrics Changes - The safety segment, which includes ICE and U.S. Marshals, experienced a decline in compensated populations, with a reduction of 1,300 from March 20 to March 31 due to the federal government's actions [36][40] - The community segment, which contributes about 5% of net operating income, saw a reduction in referrals due to disruptions in court hearings and transfers to non-residential statuses [43][44] - The property segment, accounting for about 12% of net operating income, is expected to remain stable as most revenue is generated from federal and state governments [45] Market Data and Key Metrics Changes - ICE's total detention population dropped to approximately 30,000 from about 43,000 at year-end 2019, significantly impacting revenue as ICE represents about 28% of total revenue [24][25] - The U.S. Marshals and Federal Bureau of Prisons also saw modest declines in utilization due to disruptions in the criminal justice system [26] Company Strategy and Development Direction - The company is focused on long-term positioning despite the pandemic, emphasizing prudent investments and maintaining a strong balance sheet [28][29] - Management is committed to supporting employees and communities during the pandemic, including providing additional health care benefits and a Hero Bonus for frontline staff [29][33] - The company is monitoring government assistance and has taken steps to reduce operating expenses while ensuring safety measures are in place [48][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the challenges posed by COVID-19, citing experience from past economic downturns [30][32] - The company has not seen negative budgetary impacts on contracts to date but is prepared for potential challenges [32][52] - Future financial guidance has been suspended due to uncertainties surrounding the pandemic and its impact on operations [46] Other Important Information - The company has implemented comprehensive COVID-19 response plans, including enhanced cleaning protocols and PPE supply chain management [10][12] - The average age of the company's facilities is significantly lower than that of many public correctional facilities, allowing for better compliance with social distancing guidelines [19] Q&A Session Summary Question: Can you elaborate on the decline in ICE population and any guaranteed minimum contracts? - Management confirmed that about 14 out of 21 federal contracts have monthly fixed payment provisions, providing stability despite fluctuations in populations [57][58] Question: How did the company handle state financial issues during the Great Recession? - Management noted that while states faced budget challenges, they were able to provide cost savings without materially impacting margins, and they have a playbook for similar situations today [61][62] Question: What is the status of new business prospects amid the pandemic? - Management indicated that procurement processes have been put on hold but are still actively pursuing opportunities, including in Idaho [66][67]