CoreCivic, Inc.

Good day, and thank you for standing by. Welcome to the Q1, 2026 CoreCivic, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jeb Bachman, Managing Director of Investor Relations. Please go ahead.

Thank you, Operator. Good morning, and welcome to CoreCivic's first quarter 2026 earnings call. Participating on today's call are Patrick Swindle, CoreCivic's President and Chief Executive Officer, and David Garfinkel, our Chief Financial Officer. We are also joined here in the room by our Vice President of Finance, Brian Hammonds. On this call, we will discuss financial results for the first quarter of 2026, as well as updated financial guidance for the 2026 year. We will also discuss developments with our government partners and provide you with other general business updates. During today's call, our remarks, including our answers to your questions, will include forward-looking statements pursuant to the safe harbor provisions of the Private Securities and Litigation Reform Act. Our actual results or trends may differ materially as a result of a variety of factors, including those identified in our first quarter 2026 earnings release issued after market yesterday, as well as in our Securities and Exchange Commission filings, including forms 10-K, 10-Q, and also 8-K reports. You are cautioned that any forward-looking statements reflect management's current views only and that the company undertakes no obligation to revise or update such statements in the future. Management will discuss certain non-GAAP metrics. A reconciliation of the most comparable GAAP measurement is provided in the corresponding earnings release and included in the company's quarterly supplemental financial data report posted on the investor's page of the company's website at corecivic.com. With that, it is my pleasure to turn the call over to our CEO, Patrick Swindle. Thank you, Jeb.

Good morning, and thank you for joining us for CoreCivic's first quarter 2026 earnings call. On this morning's call, we will discuss our latest operational results and update you on the latest developments and opportunities with our government partners. Following my opening remarks, I'll hand the call over to our CFO, Dave Garfinkel, who will provide greater detail on our first quarter 2026 financial results, as well as our updated 2026 financial guidance. Dave will also provide an update on our capital structure, including activity on our share repurchase program and other balance sheet initiatives. Before we discuss this quarter's financial performance, I want to share some perspective on what I see every day in this role, the work our team does and why it matters. Every day, approximately 55,000 individuals are entrusted to our care by our government partners. That means that every day around the country, more than 13,000 core civic professionals are responsible for feeding, safeguarding, treating medical and mental health needs, facilitating religious and recreational activities, providing access to legal resources, and delivering programs that help prepare people for whatever comes next in their life's journey. Our colleagues carry out these responsibilities humanely, treating residents and each other with dignity and respect. This is an incredible responsibility and an essential service for our government partners and the communities where we operate. I'm extremely proud of our team and the professionalism and purpose with which they carry out their responsibilities, and I'm deeply grateful for the trust our government partners place in CoreCivic. Through these tens of thousands of interactions each day, we have an opportunity to help build safer, healthier, and more productive communities one person at a time. Using that as a North Star enables us to achieve success for all of our stakeholders, including our shareholders. I'll now move on to a high-level overview of our first quarter operational performance. Total occupancy for our safety and community segments for the quarter was 79.6%, up 2.6 points since the year-ago quarter. The average daily population across all of the facilities we managed was 57,243 individuals during the first quarter of 2026, compared with 51,429 in the year-ago quarter. This increase was driven by more demand for our services, new contracting activity, and the Farm Bill acquisition that was completed July 1st, 2025. This is a meaningful increase, and our teams continue to be focused on delivering the highest quality services and environment every day. Federal partners, primarily ICE and the U.S. Marshal Service, comprise 58% of CoreCivic's total revenue in the first quarter. Revenue from our federal partners increased 48% during the first quarter of 2026 compared with the prior year quarter. Further breaking down our federal mix, revenue from ICE increased 128.1 million, or 96.2%, while revenue from the U.S. Marshal Service decreased by 12.2 million versus the prior year quarter. Some of this decline is simply a shift in mix where ICE and marshals share a contract. Populations from ICE in our care increased by approximately 4,500 individuals, or 45% from the beginning of 2025 through March 31, 2026, when we cared for 14,689 individuals. And our average daily population increased by 6,822 individuals in the first quarter of 2026 from the first quarter of 2025. However, since the end of January 2026, when our ICE populations peaked through April 30th, ICE populations in our care have declined by roughly 3,000 individuals. We believe this decline is temporary and event-specific, and Dave will review our population assumptions at a high level reflected in our financial guidance. A key aspect of our ability to meet the increase in demand we've experienced from ICE has been the activation of five idle facilities. Activating idle facilities is challenging work, and activating numerous facilities simultaneously is particularly challenging, but I couldn't be more proud of our team's progress. Occupancy at our 600-bed West Tennessee Detention Center, where we signed a new contract and began accepting detainees in the third quarter of 2025, has stabilized and our daily operations are now fairly routine. We continue to receive detainee populations at our 2,560-bed California City Detention Facility, where we signed a new contract effective September 1st, 2025, and at our 2,160-bed Diamondback Correctional Facility, where we signed a new contract effective September 30th, 2025. As of March 31st, 2026, we cared for 1,817 individuals and 735 individuals respectively at these two facilities. We received approval for a special use permit at our 1,033-bed Midwest Regional Reception Center in early March 2026 and immediately began accepting detainees. The facility has been undergoing reactivation since a new contract was awarded in the third quarter of 2025, but experienced a temporary delay in the intake process as we worked through legal challenges in the SUP approval process. I want to reiterate our thanks to the Leavenworth City Commission for their collaboration and trust, and look forward to bolstering our longstanding relationship with the Leavenworth community. Because of the uncertain timing on the resolution of the SUP matter, We did not include the financial impact of the activation in our initial guidance for 2026. We currently expect this facility to contribute approximately $0.05 to $0.06 in incremental earnings per share for the remainder of 2026, which is included in our updated financial guidance, as Dave will discuss further. Moving to a discussion of the macro business environment with ICE. In late January 2026, nationwide ICE detention populations were at historic highs around 70,800 individuals. an increase of approximately 1,000 from the end of the fourth quarter. However, a government shutdown that centered around Department of Homeland Security funding, a reorganization of DH leadership, and a subsequent impact to enforcement activities, including redeployment of ICE agents to TSA checkpoints, led to a 10,500 decrease in detention populations by early April 2026. While we cannot predict how quickly population growth will resume, the administration continues to indicate a strong emphasis on border security and active ICE enforcement. What has potentially changed is how DHS plans to meet its detention vet needs going forward, including through the conversion of vacant warehouse facilities into immigration detention facilities and or the acquisition of existing turnkey facilities. As the former has garnered a lot of attention for various reasons, we do not know the future of that strategy. However, as widely reported in the media and in numerous analyst reports, we do believe the potential of turnkey facility acquisitions remains as our government partners look to secure capacity throughout the United States. Nationwide populations from the U.S. Marshals Service, our second largest customer, have declined from the prior year, partially offsetting the increase from ICE as facilities that share contracts between the two agencies have extended the capacity to ICE due to the higher demand. Marshall's populations are also down nationwide due to fewer apprehensions at the southern border. Our average daily Marshall's population declined by 1,360 individuals in the first quarter of 2026 from the first quarter of 2025, although we have experienced a steady increase in average daily Marshall's populations the past few months. Revenue from our state partners, which comprises 33% of our total revenue in the first quarter, increased 3.6% from the prior year quarter. This increase includes per diem increases under a number of our state contracts and population growth from the states of Georgia, Montana, and Colorado. This increase is net of a decline in revenue for the transition of populations at our Trousdale facility in Tennessee, which resulted in a decline in populations that we expect to recover in the coming quarters. Excluding the decline in revenue at Trousdale, revenue for state partners increased 5.2%. We continue to see an increase in opportunities at the state level. In addition to increases in populations in our existing contracts, we entered discussions with several states in need of additional bed capacity. At the end of the first quarter, we began consolidating and expanding state customer population into our Tallahatchie County Correctional Facility in order to provide single location service for this customer, while creating more marketable capacity for a potential new state customer in Arizona. We continue to maintain five idle corrections and detention facilities containing approximately 7,000 beds to meet any federal or state increase in demand. We remain confident that the corrections and detention beds that we provide are the most humane, most efficient logistically, most compliant, most secure, readily available, and provide the best value to the government. Moving on to capital deployment, we remain focused on creating value for our shareholders through operational excellence and meaningful organic growth, an active share buyback program, and at times, accretive acquisitions. In April of 2026, we executed on an agreement to acquire Clinical Solutions Pharmacy, one of the largest providers of mail order pharmacy services to correctional facilities in the United States. This ancillary business complements our core mission of improving the lives of those in our care while providing a diversifying revenue stream and meaningful growth opportunities as correctional populations age with more complex and chronic medical needs. CSP's exclusive focus on the corrections market, serving over 600 correctional facilities, including core civics across 28 states, uniquely positions it to support the government agencies seeking reliable, clinically advanced pharmacy solutions. CSP is at the forefront of the correctional pharmacy business with 50% of shipments being fully automated, which is a key differentiator in the industry, filling approximately 60,000 prescriptions per day, with no single customer currently accounting for more than 15% of its annual revenue. CSP is headquartered and operates a centralized distribution center less than 30 miles from our facility support center here in greater Nashville, and has nearly 300 employees. I want to welcome the CSP employees to the CoreCivic team. We're excited about the future with CSP and look forward to reporting on the progress. They will provide more details on the financial impact of the acquisition. Our first quarter results exceeded average analyst estimates for adjusted EPS by 12 cents and adjusted EBITDA by 13.3 million. While we are pleased with the first quarter results, we expect a sequential decline in per share results in the second quarter as a result of the recent reduction in nationwide ICE detention populations. However, for the reasons I mentioned earlier, we believe this reduction is temporary. Even with this reduction, we are increasing our full-year guidance, reflecting our strategic investment in clinical solutions and the successful activation of our Midwest Regional Reception Center, which more than offset the decline in our updated forecasts for ICE populations. As I noted on our last earnings call, despite full-year 2026 EBITDA guidance near record levels, our stock continues to trade at a discount to our historical trading multiples, which we believe does not reflect the cash flows of our business particularly considering the ongoing activations of previously idle facilities, giving us visibility into our growth potential in 2026 and beyond. The acquisition of CSP further strengthens that growth outlook. We also believe that our current share price implies a significant discount to the fair value of our real estate assets using just about any valuation methodology. Accordingly, we plan to continue prioritizing our cash flows towards share repurchase, taking into consideration our stock price and alternative opportunities to deploy capital, among other factors. Additionally, the recently completed $100 million term loan supports balance sheet flexibility as we navigate the partial government shutdown environment and assess potential asset sales that could further enhance our liquidity, enabling us to continue to deploy capital in ways we believe create shareholder value. With that, I'll turn the call over to Dave to discuss our first quarter financial results in more detail. for capital allocation activities and the assumptions underlying our updated 2026 financial guidance.