CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY AND SUBSIDIARIES

9 Months Ended

Sep. 30, 2015

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS OF THE COMPANY AND SUBSIDIARIES

12. 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 September 30, 2015

(in thousands)

ASSETS	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
Cash and cash equivalents	$	32,417	$	45,985	$	—		$	78,402
Restricted cash		645		340		—			985
Accounts receivable, net of allowance		173,613		154,382		(77,458	)		250,537
Current deferred tax assets		164		8,247		—			8,411
Prepaid expenses and other current assets		3,512		40,680		(7,959	)		36,233
Total current assets		210,351		249,634		(85,417	)		374,568
Property and equipment, net		2,531,397		241,346		—			2,772,743
Restricted cash		122		—		—			122
Investment in direct financing lease		1,348		—		—			1,348
Goodwill		—		15,155		—			15,155
Non-current deferred tax assets		—		6,230		(354	)		5,876
Other assets		252,542		45,657		(217,379	)		80,820
Total assets	$	2,995,760	$	558,022	$	(303,150	)	$	3,250,632
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued expenses	$	200,169	$	207,484	$	(85,382	)	$	322,271
Income taxes payable		3		1,480		—			1,483
Total current liabilities		200,172		208,964		(85,382	)		323,754
Long-term debt		1,320,000		115,000		(115,000	)		1,320,000
Non-current deferred tax liabilities		354		—		(354	)		—
Deferred revenue		—		72,722		—			72,722
Other liabilities		1,353		58,922		—			60,275
Total liabilities		1,521,879		455,608		(200,736	)		1,776,751
Total stockholders’ equity		1,473,881		102,414		(102,414	)		1,473,881
Total liabilities and stockholders’ equity	$	2,995,760	$	558,022	$	(303,150	)	$	3,250,632

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2014

(in thousands)

ASSETS	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
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 September 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	294,578		$	384,840		$	(219,461	)	$	459,957
EXPENSES:
Operating		226,020			319,941			(219,461	)		326,500
General and administrative		8,226			18,565			—			26,791
Depreciation and amortization		20,623			20,607			—			41,230
		254,869			359,113			(219,461	)		394,521
OPERATING INCOME		39,709			25,727			—			65,436
OTHER (INCOME) EXPENSE:
Interest expense, net		7,739			4,025			—			11,764
Expenses associated with debt refinancing transactions		701			—			—			701
Other (income) expense		131			(469	)		(25	)		(363	)
		8,571			3,556			(25	)		12,102
INCOME BEFORE INCOME TAXES		31,138			22,171			25			53,334
Income tax expense		(480	)		(2,178	)		—			(2,658	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		30,658			19,993			25			50,676
Income from equity in subsidiaries		20,018			—			(20,018	)		—
NET INCOME	$	50,676		$	19,993		$	(19,993	)	$	50,676

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended September 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	319,127		$	310,597		$	(221,250	)	$	408,474
EXPENSES:
Operating		226,820			277,142			(221,250	)		282,712
General and administrative		8,719			18,916			—			27,635
Depreciation and amortization		20,389			7,888			—			28,277
		255,928			303,946			(221,250	)		338,624
OPERATING INCOME		63,199			6,651			—			69,850
OTHER (INCOME) EXPENSE:
Interest expense, net		8,821			1,555			—			10,376
Other (income) expense		250			(61	)		(332	)		(143	)
		9,071			1,494			(332	)		10,233
INCOME BEFORE INCOME TAXES		54,128			5,157			332			59,617
Income tax expense		(208	)		(1,863	)		—			(2,071	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		53,920			3,294			332			57,546
Income from equity in subsidiaries		3,626			—			(3,626	)		—
NET INCOME	$	57,546		$	3,294		$	(3,294	)	$	57,546

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the nine months ended September 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	899,992		$	1,093,011		$	(647,751	)	$	1,345,252
EXPENSES:
Operating		669,653			923,295			(647,751	)		945,197
General and administrative		23,725			53,045			—			76,770
Depreciation and amortization		60,967			47,348			—			108,315
Asset impairments		—			955			—			955
		754,345			1,024,643			(647,751	)		1,131,237
OPERATING INCOME		145,647			68,368			—			214,015
OTHER (INCOME) EXPENSE:
Interest expense, net		24,420			9,295			—			33,715
Expenses associated with debt refinancing transactions		701			—			—			701
Other (income) expense		91			(479	)		35			(353	)
		25,212			8,816			35			34,063
INCOME BEFORE INCOME TAXES		120,435			59,552			(35	)		179,952
Income tax expense		(1,001	)		(5,695	)		—			(6,696	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		119,434			53,857			(35	)		173,256
Income from equity in subsidiaries		53,822			—			(53,822	)		—
NET INCOME	$	173,256		$	53,857		$	(53,857	)	$	173,256

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the nine months ended September 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments and Other			Total Consolidated Amounts
REVENUES	$	939,686		$	936,352		$	(652,648	)	$	1,223,390
EXPENSES:
Operating		671,914			838,436			(652,648	)		857,702
General and administrative		25,648			53,938			—			79,586
Depreciation and amortization		60,266			25,147			—			85,413
Asset impairments		2,238			—			—			2,238
		760,066			917,521			(652,648	)		1,024,939
OPERATING INCOME		179,620			18,831			—			198,451
OTHER (INCOME) EXPENSE:
Interest expense, net		26,232			2,856			—			29,088
Other (income) expense		87			(589	)		(641	)		(1,143	)
		26,319			2,267			(641	)		27,945
INCOME BEFORE INCOME TAXES		153,301			16,564			641			170,506
Income tax expense		(342	)		(5,148	)		—			(5,490	)
INCOME BEFORE EQUITY IN SUBSIDIARIES		152,959			11,416			641			165,016
Income from equity in subsidiaries		12,057			—			(12,057	)		—
NET INCOME	$	165,016		$	11,416		$	(11,416	)	$	165,016

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended September 30, 2015

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other			Total Consolidated Amounts
Net cash provided by operating activities	$	182,363		$	123,378		$	—		$	305,741
Net cash used in investing activities		(82,731	)		(75,349	)		(67,599	)		(225,679	)
Net cash provided by (used in) financing activities		(79,552	)		(64,100	)		67,599			(76,053	)
Net increase (decrease) in cash and cash equivalents		20,080			(16,071	)		—			4,009
CASH AND CASH EQUIVALENTS, beginning of period		12,337			62,056			—			74,393
CASH AND CASH EQUIVALENTS, end of period	$	32,417		$	45,985		$	—		$	78,402

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended September 30, 2014

(in thousands)

	Parent			Combined Subsidiary Guarantors			Consolidating Adjustments And Other			Total Consolidated Amounts
Net cash provided by (used in) operating activities	$	253,232		$	(4,543	)	$	—		$	248,689
Net cash used in investing activities		(130,102	)		(81,892	)		70,500			(141,494	)
Net cash provided by (used in) financing activities		(144,443	)		78,676			(70,500	)		(136,267	)
Net decrease in cash and cash equivalents		(21,313	)		(7,759	)		—			(29,072	)
CASH AND CASH EQUIVALENTS, beginning of period		31,647			46,272			—			77,919
CASH AND CASH EQUIVALENTS, end of period	$	10,334		$	38,513		$	—		$	48,847