13.

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, 2016

(in thousands)

Parent

Combined
Subsidiary
Guarantors

Consolidating
Adjustments
and Other

Total
Consolidated
Amounts

ASSETS

Cash and cash equivalents

22,704

20,027

—

42,731

Accounts receivable, net of allowance

241,507

284,022

(303,109

)

222,420

Prepaid expenses and other current assets

3,020

35,832

(6,110

)

32,742

Total current assets

267,231

339,881

(309,219

)

297,893

Property and equipment, net

2,499,353

350,866

—

2,850,219

Restricted cash

218

—

218

Goodwill

23,231

15,155

—

38,386

Non-current deferred tax assets

—

12,295

(322

)

11,973

Other assets

343,811

60,626

(317,614

)

86,823

Total assets

3,133,844

778,823

(627,155

)

3,285,512

LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable and accrued expenses

256,522

382,143

(309,219

)

329,446

Income taxes payable

1,374

253

—

1,627

Current portion of long-term debt

8,750

—

8,750

Total current liabilities

266,646

382,396

(309,219

)

339,823

Long-term debt, net

1,421,228

113,927

(115,000

)

1,420,155

Non-current deferred tax liabilities

322

—

(322

)

—

Deferred revenue

—

36,257

—

36,257

Other liabilities

1,455

43,629

—

45,084

Total liabilities

1,689,651

576,209

(424,541

)

1,841,319

Total stockholders’ equity

1,444,193

202,614

(202,614

)

1,444,193

Total liabilities and stockholders’ equity

3,133,844

778,823

(627,155

)

3,285,512

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2015

(in thousands)


	Parent		Combined Subsidiary Guarantors		Consolidating Adjustments and Other			Total Consolidated Amounts
ASSETS

Cash and cash equivalents	$	15,666	$	49,625	$	—		$	65,291
Restricted cash		637		240		—			877
Accounts receivable, net of allowance		300,632		159,286		(225,462	)		234,456
Prepaid expenses and other current assets		3,760		43,706		(6,032	)		41,434

Total current assets		320,695		252,857		(231,494	)		342,058

Property and equipment, net		2,526,278		356,782		—			2,883,060

Restricted cash		131		—		—			131
Investment in direct financing lease		684		—		—			684
Goodwill		20,402		15,155		—			35,557
Non-current deferred tax assets		—		10,217		(393	)		9,824
Other assets		241,510		57,120		(213,926	)		84,704


Total assets	$	3,109,700	$	692,131	$	(445,813	)	$	3,356,018


LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable and accrued expenses	$	191,600	$	357,569	$	(231,494	)	$	317,675
Income taxes payable		—		1,920		—			1,920
Current portion of long-term debt		5,000		—		—			5,000

Total current liabilities		196,600		359,489		(231,494	)		324,595

Long-term debt, net		1,448,316		113,761		(115,000	)		1,447,077
Non-current deferred tax liabilities		393		—		(393	)		—
Deferred revenue		—		63,289		—			63,289
Other liabilities		1,643		56,666		—			58,309

Total liabilities		1,646,952		593,205		(346,887	)		1,893,270



Total stockholders’ equity		1,462,748		98,926		(98,926	)		1,462,748


Total liabilities and stockholders’ equity	$	3,109,700	$	692,131	$	(445,813	)	$	3,356,018

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

For the three months ended September 30, 2016

(in thousands)

Parent

Combined
Subsidiary
Guarantors

Consolidating
Adjustments
and Other

Total
Consolidated
Amounts

REVENUES

298,659

398,617

(222,341

)

474,935

EXPENSES:

Operating

230,244

318,446

(222,341

)

326,349

General and administrative

9,326

18,373

—

27,699

Depreciation and amortization

21,321

21,603

—

42,924

Restructuring charges

197

3,813

—

4,010

261,088

362,235

(222,341

)

400,982

OPERATING INCOME

37,571

36,382

—

73,953

OTHER (INCOME) EXPENSE:

Interest expense, net

12,975

3,962

—

16,937

Other (income) expense

115

(57

)

13,090

3,905

)

16,991

INCOME BEFORE INCOME TAXES

24,481

32,477

56,962

Income tax expense

(512

)

(1,110

)

—

(1,622

)

INCOME BEFORE EQUITY IN SUBSIDIARIES

23,969

31,367

55,340

Income from equity in subsidiaries

31,371

—

(31,371

)

—

NET INCOME

55,340

31,367

(31,367

)

55,340

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 nine months ended September 30, 2016

(in thousands)

Parent

Combined
Subsidiary
Guarantors

Consolidating
Adjustments
and Other

Total
Consolidated
Amounts

REVENUES

876,697

1,162,834

(653,880

)

1,385,651

EXPENSES:

Operating

676,997

933,596

(653,880

)

956,713

General and administrative

27,352

54,191

—

81,543

Depreciation and amortization

63,267

64,061

127,328

Restructuring charges

197

3,813

—

4,010

767,813

1,055,661

(653,880

)

1,169,594

OPERATING INCOME

108,884

107,173

—

216,057

OTHER (INCOME) EXPENSE:

Interest expense, net

38,845

12,432

—

51,277

Other (income) expense

516

(401

)

(12

)

103

39,361

12,031

(12

)

51,380

INCOME BEFORE INCOME TAXES

69,523

95,142

164,677

Income tax expense

(1,393

)

(4,054

)

—

(5,447

)

INCOME BEFORE EQUITY IN SUBSIDIARIES

68,130

91,088

159,230

Income from equity in subsidiaries

91,100

—

(91,100

)

—

NET INCOME

159,230

91,088

(91,088

)

159,230

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 CASH FLOWS

For the nine months ended September 30, 2016

(in thousands)

Parent

Combined
Subsidiary
Guarantors

Consolidating
Adjustments
And Other

Total
Consolidated
Amounts

Net cash provided by operating activities

271,286

29,901

—

301,187

Net cash used in investing activities

(35,510

)

(60,453

)

—

(95,963

)

Net cash provided by (used in) financing activities

(228,738

)

954

—

(227,784

)

Net increase (decrease) in cash and cash equivalents

7,038

(29,598

)

—

(22,560

)

CASH AND CASH EQUIVALENTS, beginning of period

15,666

49,625

—

65,291

CASH AND CASH EQUIVALENTS, end of period

22,704

20,027

—

42,731

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