Benjamin Briggs

Benjamin Briggs sought clarification on the $450 million EBITDA run rate, confirming it includes two new contracts but excludes Midwest Regional. He also asked about the potential EBITDA upside from activating Midwest Regional, the total additional bed capacity including surge, and whether the revolver remains an option for share repurchases.

Answer

David Garfinkle, CFO, confirmed the EBITDA run rate clarification and noted Midwest Regional's $60 million annual revenue, which would be upside to guidance. He also confirmed the 13,000 total additional bed capacity. Regarding share repurchases, he stated that AFFO (approximately $200 million after growth CapEx) is available without increasing leverage, but the revolving credit facility can also be utilized.

Benjamin Briggs from StoneX Financial sought clarification on CoreCivic's 2026 EBITDA run rate of $450 million, confirming it includes new contracts but excludes Midwest Regional. He also asked about the potential EBITDA upside from Midwest Regional, the total additional bed capacity (idle and surge), and whether the expanded revolver or cash from operations would primarily fund future share repurchases.

Answer

CFO David Garfinkle confirmed the $450 million EBITDA run rate excludes Midwest Regional and any new contract wins, noting Midwest Regional's annual revenue was $60 million. CEO Patrick Swindle reinforced that the guidance has high visibility and any new wins would be incremental upside. David Garfinkle confirmed 13,000 total additional beds (7,000 idle, 5,000 surge, plus other means). For funding, David Garfinkle stated that approximately $200 million in annual cash flow (AFFO minus growth CapEx) would be available without increasing leverage, but the expanded revolving credit facility is also available for repurchases.

Benjamin Briggs sought to confirm the key figures presented: the 28,000-bed proposal to ICE and the associated revenue and EBITDA potential. He also asked about the ability to mix different government populations within a single facility, the possibility of new facility construction, and potential opportunities with the Bureau of Prisons (BOP).

Answer

CEO Damon Hininger confirmed the 28,000-bed proposal. CFO David Garfinkle clarified the math, stating that activating ~15,000 idle beds could generate $750M-$800M in revenue and $200M-$275M in EBITDA. President Patrick Swindle explained that facilities are designed flexibly to house multiple, separated populations. Hininger stated that new construction is not a near-term need given existing capacity and expansion options. Regarding the BOP, he sees the most significant near-term opportunity in expanding community confinement and halfway house capacity to support the First Step Act.

Benjamin Briggs asked for clarification on the number of active RFIs and RFPs, whether any COVID-19 population restrictions remain, and for an EBITDA bridge explaining the change from Q4 2023 to the guided Q4 2024.

Answer

CFO David Garfinkle clarified the procurement landscape: ICE has two RFIs covering five Areas of Responsibility and one RFP in New Jersey; Montana has one RFP; and ICE also has the new ATD RFI. CEO Damon T. Hininger confirmed all COVID-related population restrictions have been lifted in their portfolio. For the Q4 EBITDA bridge, Garfinkle explained the year-over-year decline is primarily due to the loss of contributions from two major contracts: the South Texas facility (terminated Aug 2024) and the California City facility (terminated March 2024).