Correctional Services Corporation Announces Financial Results for First Quarter 2005
May 12 2005 - 7:31AM
Business Wire
Correctional Services Corporation (NASDAQ:CSCQ) today announced
financial results for the first quarter 2005. Revenues for the
first quarter were $32.1 million versus $32.0 million in the
comparative period in 2004. For the 2005 quarter, the Company
reported contribution from operations of $3.1 million and a net
loss of $509,000 or $0.05 per diluted share. For the first quarter
of 2004, the Company reported contribution from operations of $2.2
million and a net loss of $656,000 or $0.06 per diluted share.
Diluted shares were 10,167,000 and 10,159,000 in the first quarter
2005 and 2004, respectively. Included in the reported amounts for
the first quarter 2005 and 2004 were the following pre-tax items:
(in thousands) -0- *T 2005 2004 ---- ---- -- Startup expenses
associated with the opening of new facilities $139 $1,705 -- Loss
from discontinued operations $140 $658 *T The above pre-tax charges
for the first quarter 2005 totaled $279,000. The total for the 2004
pre-tax items was income of $2.4 million. The after tax charges for
2005 were $170,000 or $0.02 per diluted share and the after tax
charge for 2004 was $1.4 million or $0.14 per diluted share.
Commenting on the first quarter results, James F. Slattery,
President & CEO stated, "I am disappointed in the first quarter
results which were impacted by lower utilization by the Immigration
& Customs Enforcement (ICE) at several of our Texas adult
facilities due to budget issues. However, additional funding is now
in place and we have begun to see occupancy improvement." Slattery
further stated, "The Company will continue to focus on our near
term goal of improved earnings by increasing occupancy at our
existing adult facilities and stabilizing the performance of our
juvenile division. We continue to proceed toward the timely opening
in late June of our new 1020 bed Department of Homeland Security
ICE facility in South Texas and the June opening of the 96 bed
expansion of our Littlefield facility which will house inmates for
the Wyoming Department of Corrections. These new beds in addition
to the full implementation of our Behavioral Health Overlay
Services (BHOS) at our Florida Juvenile Programs are expected to
produce earnings improvement in the third and fourth quarters." The
Company will be having a conference call to discuss this release on
Thursday May 12, 2005 at 11:00 a.m. EDT. The number to call is
(888) 858-4066 (U.S. only) or (973) 935-2403 (International). A
replay will be available by calling (877) 519-4471 and using the
pin 6045297. Through its Youth Services International subsidiary,
the Company is the nation's leading private provider of juvenile
programs for adjudicated youths with 17 facilities and 1,300
juveniles in its care. In addition, the Company is a leading
developer and operator of adult correctional facilities, operating
14 facilities with approximately 5,500 beds. On a combined basis,
the Company provides services in 12 states, representing
approximately 6,800 beds including aftercare services. Safe Harbor
Statement Under The Private Securities Litigation Reform Act of
1995 Certain statements contained in this press release are not
historical but are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and Section
21E of the Securities Exchange Act of 1934, as amended. These
include statements regarding the expectations, beliefs, intentions
or strategies regarding the future. The Company intends that all
forward-looking statements be subject to the safe-harbor provisions
of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements reflect the Company's views as of the
date they are made with respect to future events and financial
performance, but are subject to many uncertainties and risks which
could cause the actual results of the Company to differ materially
from any future results expressed or implied by such
forward-looking statements. Examples of such uncertainties and
risks include, but are not limited to: fluctuations in occupancy
levels and labor costs; the ability to secure both new contracts
and the renewal of existing contracts; the possibility of
unforeseen costs relating to facility closings, the ability to
achieve profitability and public resistance to privatization;
ability to obtain construction financing; and ability to complete
new construction projects within budgeted amounts. Additional risk
factors include those discussed in reports filed by the Company
from time to time on Forms 10-K, 10-Q and 8-K. The Company does not
undertake any obligation to update any forward-looking statements.
-0- *T CORRECTIONAL SERVICES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (dollars in thousands, except
per share data) Three Months Ended March 31,
--------------------------------- 2005 2004 ----------------
---------------- Revenues from continuing operations $32,066
100.00% $32,041 100.00% -------- ------- -------- ------- Facility
expenses: Operating 28,830 89.91% 28,109 87.73% Start up costs 139
0.43% 1,705 5.32% -------- ------- -------- ------- 28,969 90.34%
29,814 93.05% -------- ------- -------- ------- Contribution from
operations 3,097 9.66% 2,227 6.95% General and administrative
expenses 2,254 7.03% 2,153 6.72% -------- ------- -------- -------
Operating income 843 2.63% 74 0.23% Interest expense, net 1,550
4.83% 557 1.74% -------- ------- -------- ------- Loss from
continuing operations before income taxes (707) -2.20% (483) -1.51%
Income tax benefit (283) -0.88% (228) -0.71% -------- -------
-------- ------- Loss from continuing operations (424) -1.32% (255)
-0.80% Loss from discontinued operations, net of tax benefit of $55
and $257 (85) -0.27% (401) -1.25% -------- ------- -------- -------
Net loss $(509) -1.59% $(656) -2.05% ======== ======= ========
======= Basic and diluted loss per share Loss per share from
continuing operations $(0.04) $(0.02) Loss per share from
discontinued operations (0.01) (0.04) -------- -------- Loss per
share $(0.05) $(0.06) ======== ======== Number of shares used to
compute EPS: Basic 10,167 10,159 ======== ======== Diluted 10,167
10,159 ======== ======== Other Information Beds under management
(includes aftercare) 6,771 7,693 Compensated mandays 495,170
508,644 SELECTED BALANCE SHEET DATA March 31 December 31 2005 2004
-------- -------- Working Capital $10,841 $11,686 Total Assets
199,896 199,990 Bond and Note Payable 101,969 101,962 Other
Long-term Obligations 18,854 18,995 Shareholders' Equity 47,604
48,113 *T
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