SEGMENT REPORTING

3 Months Ended

Mar. 31, 2014

SEGMENT REPORTING

11. SEGMENT REPORTING

As of March 31, 2014, CCA owned and managed 49 correctional and detention facilities, and managed 13 correctional and detention facilities it did not own. In addition, CCA owned three facilities that it leased to third-party operators. Management views CCA’s operating results in two reportable segments: (1) owned and managed correctional and detention facilities and (2) managed-only correctional and detention facilities. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in the notes to consolidated financial statements included in CCA’s 2013 Form 10-K. Owned and managed facilities include the operating results of those facilities placed into service that were owned or controlled via a long-term lease and managed by CCA. Managed-only facilities include the operating results of those facilities owned by a third party and managed by CCA. CCA measures the operating performance of each facility within the above two reportable segments, without differentiation, based on facility net operating income. CCA defines facility net operating income as a facility’s operating income or loss from operations before interest, taxes, asset impairments, depreciation, and amortization. Since each of CCA’s facilities within the two reportable segments exhibit similar economic characteristics, provide similar services to governmental agencies, and operate under a similar set of operating procedures and regulatory guidelines, the facilities within the identified segments have been aggregated and reported as one reportable segment.

The revenue and facility net operating income for the reportable segments and a reconciliation to CCA’s operating income is as follows for the three months ended March 31, 2014 and 2013 (in thousands):

	For the Three Months Ended March 31,
	2014			2013
Revenue:
Owned and managed	$	334,912		$	341,493
Managed-only		64,003			74,312
Total management revenue		398,915			415,805
Operating expenses:
Owned and managed		227,648			229,255
Managed-only		58,445			64,742
Total operating expenses		286,093			293,997
Facility net operating income
Owned and managed		107,264			112,238
Managed-only		5,558			9,570
Total facility net operating income		112,822			121,808
Other revenue (expense):
Rental and other revenue		5,307			918
Other operating expense		(1,287	)		(4,225	)
General and administrative expense		(25,392	)		(31,232	)
Depreciation and amortization		(28,384	)		(27,377	)
Operating income	$	63,066		$	59,892

The following table summarizes capital expenditures for the reportable segments for the three months ended March 31, 2014 and 2013 (amounts in thousands):

	For the Three Months Ended March 31,
	2014		2013
Capital expenditures:
Owned and managed	$	25,620	$	8,319
Managed-only		632		668
Corporate and other		1,032		1,530
Discontinued operations		—		286
Total capital expenditures	$	27,284	$	10,803

The assets for the reportable segments are as follows (amounts in thousands):

	March 31, 2014		December 31, 2013
Assets:
Owned and managed	$	2,566,164	$	2,694,293
Managed-only		74,031		81,551
Corporate and other		329,057		231,566
Discontinued operations		6		15
Total assets	$	2,969,258	$	3,007,425