Executive Summary

Q4 delivered solid operational execution with 75.5% occupancy (highest since Q1’20) and tight cost control; GAAP EPS was $0.17 and adjusted EPS $0.16, while adjusted EBITDA was $74.2M .
Results beat average analyst estimates on multiple metrics: adjusted EPS by $0.06, normalized FFO/share by $0.05, and adjusted EBITDA by $7.9M, despite headwinds from the South Texas Family Residential Center (STX) termination and California City lease expiration .
Management introduced FY2025 guidance (EPS $0.48–$0.61; FFO/share $1.37–$1.50; EBITDA $281–$293M) that excludes new wins but embeds $0.40/share drag from STX/California City; Q1 seasonality to reduce per‑share earnings by ~4% vs Q4 .
Strategic setup improved materially post U.S. administration change and passage of the Laken Riley Act; CXW proposed up to 28,000 ICE beds and sees potential $200–$275M incremental EBITDA from activating ~15,000 idle/leased beds, a possible medium‑term earnings catalyst .

What Went Well and What Went Wrong

What Went Well
- Cost normalization and occupancy gains: “financial results exceeded our internal forecast and analyst estimates, helped by tight cost discipline and higher occupancy,” with Q4 occupancy at 75.5% (post‑COVID high) .
- State/local momentum: State revenue +6.4% YoY; local revenue +26% YoY; added new Montana contract in Jan-25 and continued wins with Wyoming, Harris County (TX), Hinds County (MS) .
- Policy tailwinds and pipeline: New administration priorities and the Laken Riley Act could require substantial detention capacity; CXW has proposals for 28,000 ICE beds and is pre‑investing $40–$45M to accelerate activations .
What Went Wrong
- Mix headwind from contract/lease terminations: Q4 adjusted EBITDA down YoY to $74.2M due to STX termination and California City lease expiration, together reducing facility NOI by $22.8M YoY .
- Margin compression: Safety & Community operating margin was 23.6% vs 24.4% LY (portfolio mix impact from loss of higher‑margin STX) .
- Federal revenue down YoY due to STX: ICE revenue fell to $120.3M from $153.5M, though ex‑STX, ICE revenue rose ~5% YoY; Properties revenue also lower on California City roll‑off .

Financial Results

Headline metrics vs prior periods and estimates

Metric	Q4 2023	Q3 2024	Q4 2024
Revenue ($M)	$491.2	$491.6	$479.3
GAAP Diluted EPS ($)	$0.23	$0.19	$0.17
Adjusted Diluted EPS ($)	$0.23	$0.20	$0.16
Adjusted EBITDA ($M)	$90.0	$83.3	$74.2
Operating Margin % (Safety+Community)	24.4%	24.9%	23.6%

Estimate surprise (as disclosed by management)

Metric	Q4 2024 Reported	Vs Avg Analyst Estimate
Adjusted EPS ($)	$0.16	+$0.06
Normalized FFO/share ($)	$0.39	+$0.05
Adjusted EBITDA ($M)	$74.2	+$7.9

Note: S&P Global consensus detail (revenue/EPS levels) was unavailable at query time; estimate comparisons above reflect management’s “average analyst estimate” disclosures . S&P Global consensus values were not retrievable due to rate limits.

Segment revenue (Q4)

Segment Revenue ($M)	Q4 2023	Q4 2024
Safety	$448.7	$444.5
Community	$30.5	$30.3
Properties	$12.0	$4.5
Total	$491.2	$479.3

Key performance indicators

KPI	Q4 2023	Q3 2024	Q4 2024
Occupancy – Safety & Community (combined)	74.0%	75.2%	75.5%
Occupancy – Safety	74.7%	75.7%	76.0%
Occupancy – Community	63.7%	66.7%	68.8%
ICE Detention Population (range)	n/a	36k–38k (Q3)	38k–40k (Q4); 39,263 on 1/25/25
ICE Revenue ($M)	$153.5	n/a	$120.3
Net Debt / Adj. EBITDA (TTM)	n/a	2.2x (9/30/24)	2.3x (12/31/24)
Liquidity ($M)	n/a	$365 (9/30/24)	$364 (12/31/24)

Non-GAAP notes: Adjusted EPS excludes special items, including a $0.01/share gain on sale in Q4; Adjusted EBITDA excludes gains on sale and other special items .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Diluted EPS ($)	FY 2025	n/a	0.48–0.61	New
FFO/share ($)	FY 2025	n/a	1.37–1.50	New
EBITDA ($M)	FY 2025	n/a	281–293	New
AFFO ($M)	FY 2025	n/a	148.5–165.5	New
Normalized tax rate	FY 2025	n/a	25–30%; lower in Q1	New
G&A ($M)	FY 2025	n/a	145–150	New
Maintenance capex ($M)	FY 2025	n/a	60–65 (real estate + other total)	New
Other capex ($M)	FY 2025	n/a	6–7	New
Activation capex ($M)	FY 2025	n/a	40–45 (potential idle facility activations/transport)	New
Leverage target (Net Debt/Adj. EBITDA)	FY 2025	n/a	2.25x–2.75x (may exceed temporarily if activating)	New
Seasonality	Q1 2025	n/a	~4% per‑share decline vs Q4; higher utilities/unemployment taxes	New
Mix headwind embedded	FY 2025	n/a	−$0.40/share vs 2024 from STX/California City roll‑offs	New

Guidance excludes any impact from new contract awards; management expects to revise as contracts are signed .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3 2024)	Current Period (Q4 2024)	Trend
Federal detention demand / ICE	Q2/Q3: ICE issued RFIs/RFP (Chicago, Harlingen, Salt Lake, West Coast; NJ recompete); budgeting at 41.5k funded beds; potential to 50k; STX dollars reallocated .	New admin prioritized detention; Laken Riley Act implies 60–110k additional beds; CXW proposed 28k beds; policy reversal allows DOJ/USMS direct contracts .	Strengthening
U.S. Marshals Service	Q3: USMS population could rise with policy shifts; reversal of EO on private contracts anticipated .	Expect increased USMS demand (10k+ beds over several years); direct contracting tool restored .	Strengthening
Idle facility activation & capex	Q2/Q3: Building activation plans; some capex to prep facilities; activation 4–6 months; start-up costs noted .	$40–$45M 2025 activation/transport capex; startup $4–6k/bed; positive EBITDA at ~50–65% occupancy .	Strengthening
Staffing/labor normalization	Q2/Q3: Normalization continued; reduction in temp incentives and registry nursing .	Staffing near pre‑pandemic, further cost normalization; supports quicker activations .	Stable/positive
State/local contracts	Q2: Montana/Wyoming/Counties wins; Saguaro near full . Q3: Continued state momentum .	State +6.4% YoY; local +26% YoY; new Montana award (Jan-25) and additional transfers .	Strengthening
ATD/ISAP (alternatives to detention)	Q2/Q3: New RFI; possible multi‑vendor approach; tech‑agnostic strategy .	Focus on detention in near‑term; ATD could evolve later; little near‑term emphasis from admin .	Mixed/neutral

Management Commentary

“We are anticipating significant growth opportunities… over the next several years… particularly our key federal partners, ICE and the U.S. Marshals Service.”
“Occupancy for the quarter was 75.5%, marking our highest… since the first quarter of 2020.”
“Adjusted EPS during the fourth quarter was $0.16, exceeding average analyst estimates by $0.06… normalized FFO/share… by $0.05… adjusted EBITDA… by $7.9 million.”
“We expect new contracts to require the activation of one or more of our idle facilities… startup expenses $4,000 to $6,000 per bed… positive EBITDA at approximately 50% to 65% occupancy.”
“We’ve given ICE a proposal to do 28,000 beds… we could generate incremental EBITDA of $200 million to $275 million” if 15k idle/leased beds activated .

Q&A Highlights

Scale of demand and proposal: CXW proposed up to 28k beds to ICE; management suggests total federal need could be 150k–200k beds when combining enforcement and Laken Riley Act requirements (budget dependent) .
Earnings power: Activating ~15k idle/leased beds could add ~$750–$800M revenue and $200–$275M EBITDA at historical federal margins .
South Texas (Dilley) reactivation: Discussions ongoing; potential faster re‑open due to recent deactivation and retained staffing; possible emergency contracting pathway .
Contract structure and risk: Expect fixed payments/minimums in future ICE deals to cover fixed costs; similar to historical contracts .
Activation timing/costs: Typical 4–6 months; CXW front‑loading low‑cost prep to compress timelines; startup burden may weigh near‑term guidance before benefits accrue (more favorable in 2026) .

Estimates Context

S&P Global consensus detail for Q4’24 was unavailable at query time; however, management disclosed Q4 beats versus average analyst estimates: adjusted EPS +$0.06; normalized FFO/share +$0.05; adjusted EBITDA +$7.9M .
Given the policy/capacity catalysts, estimate revisions likely to trend higher on 2H’25–2026 if new federal contracts are awarded; near‑term margin could be pressured by startup expenses before stabilization (guidance currently excludes new awards) .

Key Takeaways for Investors

Core earnings resilient: Despite STX/California City roll‑offs, CXW beat on adjusted EPS/FFO/EBITDA via occupancy gains and cost normalization; operating leverage to further occupancy remains significant .
Federal super‑cycle potential: New administration and Laken Riley Act create a rare multi‑year capacity upcycle; CXW’s 28k‑bed proposal and 13k+ idle owned beds position it for outsized wins .
Activation math: Each 15k beds activated could drive $200–$275M EBITDA post‑ramp; but expect 4–6 month start‑up costs and capex ($4–6k/bed; $2.5–$5k/bed for reactivation capex) to modestly pressure near‑term margins .
2025 guide is a base case: Excludes any new awards; embeds -$0.40/share impact from 2024 closures and typical Q1 seasonal dip; watch for upward revisions as awards materialize .
State/local ballast: Continued momentum with Montana/Wyoming and counties adds diversification and supports occupancy while federal pipeline develops .
Balance sheet and buybacks: 2.3x net debt/EBITDA and $364M liquidity provide flexibility; repurchases remain opportunistic, balanced against activation and potential M&A .
Trading lens: Stock likely to trade on contracting headlines (ICE/USMS awards), indications on timing/funding, and evidence of accelerated activations—near‑term startup spend vs. medium‑term EBITDA expansion is the key narrative .

Additional supporting data and disclosures can be found in CoreCivic’s Q4’24 press release and Form 8‑K exhibits, and the earnings call transcript .

CoreCivic, Inc. (CXW)·Q4 2024 Earnings Summary