CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY AND SUBSIDIARIES

6 Months Ended

Jun. 30, 2015

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY AND SUBSIDIARIES

11. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY 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.

CONDENSED CONSOLIDATING BALANCE SHEET

As of June 30, 2015

(in thousands)

	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
ASSETS
Cash and cash equivalents	$	1,556	$	39,513	$	—		$	41,069
Restricted cash		654		987		—			1,641
Accounts receivable, net of allowance		173,754		124,219		(68,432	)		229,541
Current deferred tax assets		195		8,689		—			8,884
Prepaid expenses and other current assets		3,471		45,697		(7,821	)		41,347
Total current assets		179,630		219,105		(76,253	)		322,482
Property and equipment, net		2,505,428		249,864		—			2,755,292
Restricted cash		114		—		—			114
Investment in direct financing lease		1,992		—		—			1,992
Goodwill		—		15,155		—			15,155
Non-current deferred tax assets		—		4,410		(375	)		4,035
Other assets		206,879		45,342		(176,125	)		76,096
Total assets	$	2,894,043	$	533,876	$	(252,753	)	$	3,175,166
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	173,326	$	210,484	$	(76,219	)	$	307,591
Income taxes payable		77		1,009		—			1,086
Total current liabilities		173,403		211,493		(76,219	)		308,677
Long-term debt		1,238,000		115,000		(115,000	)		1,238,000
Non-current deferred tax liabilities		375		—		(375	)		—
Deferred revenue		—		82,976		—			82,976
Other liabilities		1,104		63,248		—			64,352
Total liabilities		1,412,882		472,717		(191,594	)		1,694,005
Total stockholders’ equity		1,481,161		61,159		(61,159	)		1,481,161
Total liabilities and stockholders’ equity	$	2,894,043	$	533,876	$	(252,753	)	$	3,175,166

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2014

(in thousands)

	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
ASSETS
Cash and cash equivalents	$	12,337	$	62,056	$	—		$	74,393
Accounts receivable, net of allowance		167,626		178,911		(97,949	)		248,588
Current deferred tax assets		—		13,241		(12	)		13,229
Prepaid expenses and other current assets		17,060		34,705		(21,990	)		29,775
Total current assets		197,023		288,913		(119,951	)		365,985
Property and equipment, net		2,459,053		199,575		—			2,658,628
Restricted cash		1,267		1,591		—			2,858
Investment in direct financing lease		3,223		—		—			3,223
Goodwill		—		16,110		—			16,110
Non-current deferred tax assets		—		2,778		(477	)		2,301
Other assets		241,690		47,046		(210,650	)		78,086
Total assets	$	2,902,256	$	556,013	$	(331,078	)	$	3,127,191
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	218,403	$	205,213	$	(106,050	)	$	317,566
Income taxes payable		195		1,173		—			1,368
Current deferred tax liabilities		13		—		(13	)		—
Note payable to an affiliate		—		13,854		(13,854	)		—
Current liabilities of discontinued operations		—		54		—			54
Total current liabilities		218,611		220,294		(119,917	)		318,988
Long-term debt		1,200,000		115,000		(115,000	)		1,200,000
Non-current deferred tax liabilities		477		—		(477	)		—
Deferred revenue		—		87,227		—			87,227
Other liabilities		1,668		37,808		—			39,476
Total liabilities		1,420,756		460,329		(235,394	)		1,645,691
Total stockholders’ equity		1,481,500		95,684		(95,684	)		1,481,500
Total liabilities and stockholders’ equity	$	2,902,256	$	556,013	$	(331,078	)	$	3,127,191

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended June 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	302,374		$	372,948		$	(216,027	)	$	459,295
EXPENSES:
Operating		221,956			312,106			(216,027	)		318,035
General and administrative		6,699			16,408			—			23,107
Depreciation and amortization		20,275			18,125			—			38,400
Asset impairments		—			—			—			—
		248,930			346,639			(216,027	)		379,542
OPERATING INCOME		53,444			26,309			—			79,753
OTHER (INCOME) EXPENSE:
Interest expense, net		8,254			3,507			—			11,761
Other (income) expense		(211	)		111			136			36
		8,043			3,618			136			11,797
INCOME BEFORE INCOME TAXES		45,401			22,691			(136	)		67,956
Income tax expense		(345	)		(2,308	)		—			(2,653	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		45,056			20,383			(136	)		65,303
Income from equity in subsidiaries		20,247			—			(20,247	)		—
NET INCOME	$	65,303		$	20,383		$	(20,383	)	$	65,303

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended June 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	314,311		$	314,508		$	(218,125	)	$	410,694
EXPENSES:
Operating		225,389			280,346			(218,125	)		287,610
General and administrative		8,253			18,306			—			26,559
Depreciation and amortization		20,108			8,644			—			28,752
Asset impairments		2,238			—			—			2,238
		255,988			307,296			(218,125	)		345,159
OPERATING INCOME		58,323			7,212			—			65,535
OTHER (INCOME) EXPENSE:
Interest expense (income), net		8,809			(445	)		—			8,364
Other (income) expense		(125	)		(449	)		(39	)		(613	)
		8,684			(894	)		(39	)		7,751
INCOME BEFORE INCOME TAXES		49,639			8,106			39			57,784
Income tax benefit (expense)		86			(2,138	)		—			(2,052	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		49,725			5,968			39			55,732
Income from equity in subsidiaries		6,007			—			(6,007	)		—
NET INCOME	$	55,732		$	5,968		$	(5,968	)	$	55,732

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the six months ended June 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	605,414		$	708,171		$	(428,290	)	$	885,295
EXPENSES:
Operating		443,633			603,354			(428,290	)		618,697
General and administrative		15,499			34,480			—			49,979
Depreciation and amortization		40,344			26,741			—			67,085
Asset impairments		—			955			—			955
		499,476			665,530			(428,290	)		736,716
OPERATING INCOME		105,938			42,641			—			148,579
OTHER (INCOME) EXPENSE:
Interest expense, net		16,681			5,270			—			21,951
Other (income) expense		(40	)		(10	)		60			10
		16,641			5,260			60			21,961
INCOME BEFORE INCOME TAXES		89,297			37,381			(60	)		126,618
Income tax expense		(521	)		(3,517	)		—			(4,038	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		88,776			33,864			(60	)		122,580
Income from equity in subsidiaries		33,804			—			(33,804	)		—
NET INCOME	$	122,580		$	33,864		$	(33,864	)	$	122,580

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the six months ended June 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	620,559		$	625,755		$	(431,398	)	$	814,916
EXPENSES:
Operating		445,094			561,294			(431,398	)		574,990
General and administrative		16,929			35,022			—			51,951
Depreciation and amortization		39,877			17,259			—			57,136
Asset impairments		2,238			—			—			2,238
		504,138			613,575			(431,398	)		686,315
OPERATING INCOME		116,421			12,180			—			128,601
OTHER (INCOME) EXPENSE:
Interest expense, net		17,411			1,301			—			18,712
Other (income) expense		(163	)		(528	)		(309	)		(1,000	)
		17,248			773			(309	)		17,712
INCOME BEFORE INCOME TAXES		99,173			11,407			309			110,889
Income tax expense		(134	)		(3,285	)		—			(3,419	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		99,039			8,122			309			107,470
Income from equity in subsidiaries		8,431			—			(8,431	)		—
NET INCOME	$	107,470		$	8,122		$	(8,122	)	$	107,470

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the six months ended June 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other			Total Consolidated Amounts
Net cash provided by operating activities	$	100,465		$	114,782		$	—		$	215,247
Net cash used in investing activities		(19,214	)		(55,143	)		(84,999	)		(159,356	)
Net cash provided by (used in) financing activities		(92,032	)		(82,182	)		84,999			(89,215	)
Net decrease in cash and cash equivalents		(10,781	)		(22,543	)		—			(33,324	)
CASH AND CASH EQUIVALENTS, beginning of period		12,337			62,056			—			74,393
CASH AND CASH EQUIVALENTS, end of period	$	1,556		$	39,513		$	—		$	41,069

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the six months ended June 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other		Total Consolidated Amounts
Net cash provided by (used in) operating activities	$	147,625		$	(13,719	)	$	—	$	133,906
Net cash used in investing activities		(36,097	)		(5,810	)		—		(41,907	)
Net cash provided by (used in) financing activities		(127,882	)		4,579			—		(123,303	)
Net decrease in cash and cash equivalents		(16,354	)		(14,950	)		—		(31,304	)
CASH AND CASH EQUIVALENTS, beginning of period		31,647			46,272			—		77,919
CASH AND CASH EQUIVALENTS, end of period	$	15,293		$	31,322		$	—	$	46,615