CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF CCA AND SUBSIDIARIES

12 Months Ended

Dec. 31, 2013

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF CCA AND SUBSIDIARIES

18. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF CCA AND SUBSIDIARIES

The following condensed consolidating financial statements of CCA and subsidiaries have been prepared pursuant to Rule 3-10 of Regulation S-X. These condensed consolidating financial statements have been prepared from the Company’s financial information on the same basis of accounting as the consolidated financial statements. On December 31, 2012 CCA transferred certain real estate assets and contracts from certain of its subsidiaries to CCA (as the parent company). Accordingly, CCA (as the parent corporation to its subsidiaries) which heretofore had no independent assets or operations (as defined under Rule 3-10(f) of Regulation S-X) maintains its own independent assets as of December 31, 2013 and 2012. Such internal legal restructuring has been reported in the following condensed consolidating financial statements as if it had occurred on January 1, 2012.

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2013

(in thousands)

	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
ASSETS
Cash and cash equivalents	$	31,647	$	46,262	$	—		$	77,909
Accounts receivable, net of allowance		203,018		178,894		(136,955	)		244,957
Current deferred tax assets		2		9,239		—			9,241
Prepaid expenses and other current assets		7,580		22,856		(9,824	)		20,612
Current assets of discontinued operations		—		15		—			15
Total current assets		242,247		257,266		(146,779	)		352,734
Property and equipment, net		2,450,028		96,585		—			2,546,613
Restricted cash		1,016		4,573		—			5,589
Investment in direct financing lease		5,473		—		—			5,473
Goodwill		—		16,110		—			16,110
Non-current deferred tax assets		—		3,633		(555	)		3,078
Other assets		245,028		45,149		(212,349	)		77,828
Total assets	$	2,943,792	$	423,316	$	(359,683	)	$	3,007,425
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	234,277	$	164,745	$	(146,745	)	$	252,277
Income taxes payable		—		1,243		—			1,243
Current liabilities of discontinued operations		—		886		—			886
Total current liabilities		234,277		166,874		(146,745	)		254,406
Long-term debt		1,205,000		115,000		(115,000	)		1,205,000
Deferred tax liabilities		555		—		(555	)		—
Other liabilities		1,453		44,059		—			45,512
Total liabilities		1,441,285		325,933		(262,300	)		1,504,918
Total stockholders’ equity		1,502,507		97,383		(97,383	)		1,502,507
Total liabilities and stockholders’ equity	$	2,943,792	$	423,316	$	(359,683	)	$	3,007,425

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2012

(in thousands)

	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
ASSETS
Cash and cash equivalents	$	—	$	62,804	$	—		$	62,804
Accounts receivable, net of allowance		136,128		249,512		(138,556	)		247,084
Current deferred tax assets		137		7,885		—			8,022
Prepaid expenses and other current assets		1,766		34,499		(9,882	)		26,383
Current assets of discontinued operations		—		6,449		—			6,449
Total current assets		138,031		361,149		(148,438	)		350,742
Property and equipment, net		2,462,917		103,565		—			2,566,482
Restricted cash		—		5,022		—			5,022
Investment in direct financing lease		7,467		—		—			7,467
Goodwill		—		11,158		—			11,158
Other assets		191,502		114,922		(275,723	)		30,701
Non-current assets of discontinued operations		—		3,170		—			3,170
Total assets	$	2,799,917	$	598,986	$	(424,161	)	$	2,974,742
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	28,061	$	284,871	$	(148,403	)	$	164,529
Income taxes payable		—		102		—			102
Current liabilities of discontinued operations		—		1,827		—			1,827
Total current liabilities		28,061		286,800		(148,403	)		166,458
Long-term debt		1,111,545		100,000		(100,000	)		1,111,545
Deferred tax liabilities		138,691		835		—			139,526
Other liabilities		—		35,593		—			35,593
Total liabilities		1,278,297		423,228		(248,403	)		1,453,122
Total stockholders’ equity		1,521,620		175,758		(175,758	)		1,521,620
Total liabilities and stockholders’ equity	$	2,799,917	$	598,986	$	(424,161	)	$	2,974,742

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the year ended December 31, 2013

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	1,268,763		$	1,351,695		$	(926,161	)	$	1,694,297
EXPENSES:
Operating		945,750			1,200,762			(926,161	)		1,220,351
General and administrative		31,290			72,300			—			103,590
Depreciation and amortization		76,112			36,580			—			112,692
Asset impairments		—			6,513			—			6,513
		1,053,152			1,316,155			(926,161	)		1,443,146
OPERATING INCOME		215,611			35,540			—			251,151
OTHER (INCOME) EXPENSE:
Interest expense, net		38,319			6,807			—			45,126
Expenses associated with debt refinancing transactions		28,563			7,965			—			36,528
Other (income) expense		(45	)		23			(78	)		(100	)
		66,837			14,795			(78	)		81,554
INCOME FROM CONTINUING		148,774			20,745			78			169,597
OPERATIONS BEFORE INCOME TAXES
Income tax benefit (expense)		143,590			(8,595	)		—			134,995
INCOME FROM CONTINUING OPERATIONS		292,364			12,150			78			304,592
Income from equity in subsidiaries		8,471			—			(8,471	)		—
Loss from discontinued operations, net of taxes		—			(3,757	)		—			(3,757	)
NET INCOME	$	300,835		$	8,393		$	(8,393	)	$	300,835

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the year ended December 31, 2012

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	1,411,277		$	329,971		$	(17,591	)	$	1,723,657
EXPENSES:
Operating		943,803			290,839			(17,591	)		1,217,051
General and administrative		70,792			18,143			—			88,935
Depreciation and amortization		74,452			38,611			—			113,063
		1,089,047			347,593			(17,591	)		1,419,049
OPERATING INCOME (LOSS)		322,230			(17,622	)		—			304,608
OTHER (INCOME) EXPENSE:
Interest expense, net		57,174			1,189			—			58,363
Expenses associated with debt refinancing transactions		2,099			—			—			2,099
Other (income) expense		16			(26	)		(323	)		(333	)
		59,289			1,163			(323	)		60,129
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES		262,941			(18,785	)		323			244,479
Income tax benefit (expense)		(93,870	)		6,357			—			(87,513	)
INCOME (LOSS) FROM CONTINUING OPERATIONS		169,071			(12,428	)		323			156,966
Loss from equity in subsidiaries		(12,310	)		—			12,310			—
Loss from discontinued operations, net of taxes		—			(205	)		—			(205	)
NET INCOME (LOSS)	$	156,761		$	(12,633	)	$	12,633		$	156,761

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the year ended December 31, 2013

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other			Total Consolidated Amounts
Net cash provided by operating activities	$	211,247		$	158,257		$	—		$	369,504
Net cash used in investing activities		(83,895	)		(56,617	)		15,000			(125,512	)
Net cash used in financing activities		(95,705	)		(118,265	)		(15,000	)		(228,970	)
Net increase (decrease) in cash and cash equivalents		31,647			(16,625	)		—			15,022
CASH AND CASH EQUIVALENTS, beginning of year		—			62,897			—			62,897
CASH AND CASH EQUIVALENTS, end of year	$	31,647		$	46,272		$	—		$	77,919

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the year ended December 31, 2012

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other		Total Consolidated Amounts
Net cash provided by operating activities	$	260,602		$	22,654		$	—	$	283,256
Net cash used in investing activities		(42,378	)		(37,542	)		—		(79,920	)
Net cash used in financing activities		(218,224	)		21,953			—		(196,271	)
Net increase in cash and cash equivalents		—			7,065			—		7,065
CASH AND CASH EQUIVALENTS, beginning of year		—			55,832			—		55,832
CASH AND CASH EQUIVALENTS, end of year	$	—		$	62,897		$	—	$	62,897