Good morning, everyone, and welcome to CCA’s Fourth Quarter 2012 Earnings Conference Call. If you need a copy of our press release or supplemental financial data, both documents are available on the investor page of our website at www.cca.com. Before we begin, let me remind today’s listeners that this call contains forward-looking statements pursuant to the Safe Harbor provisions of the Securities and Litigation Reform Act. These statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made today. Factors that could cause operating and financial results to differ are described in the press release as well as our Form 10-K and other documents filed with the SEC. This call may include discussions of non-GAAP measures. The reconciliation of the most comparable GAAP measurement is provided in our corresponding earnings release and included in the supplemental financial data on our website. We are under no obligation to update or revise any forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrences of unanticipated events. Just a reminder that this today call is being recorded and joining us today will be our President and CEO, Damon Hininger and Chief Financial Officer, Todd Mullenger. I’d now like to turn the call over to Mr. Hininger. Please go ahead sir.

Thank you, Lorrie and good morning everyone and thank you for joining our call today. In addition to Todd and I being on the call we also have our Chairman, John Ferguson, our Vice President of Finance David Garfinkle and Board Member, Bill Andrews joining us on the call. Before I turn it over to Todd, I want to give you a few highlights for both the quarter and for the year ending 2012. And the first of which is just to note that we’re very excited about our two new facilities being in the portfolio that came online last year in at our Ohio facility. And also our recently constructed Jenkins facility down in Georgia. Two new facilities on the state side of the book of business. And also to note that we’ve had three new contracts with state partners taking advantage of existing capacity in our portfolio. And those are the states of Idaho and Oklahoma and also the Commonwealth of Puerto Rico. So these are great new contracts utilizing existing capacity within our system. And it just, again, shows the power of existing capacity being in the right location at the right price married up with a strong operational record. And how attractive these are two partners that are growing or dealing with overcrowding. We’re also very thrilled towards the end of last year getting a new contract with the state Arizona. So this was a former partner that we’ve had in the past, but obviously we’re very excited that they’re back in the state book of business. This award will take advantage of capacity that we’ve got out of Red Rock facility out in Arizona. And we will see any, I’ll say effective of this current track in 2013. But they’ll start ramping up in 2014…

Thank you Damon and good morning everyone. As Damon mentioned, in the fourth quarter of 2012 we generated $0.44 of adjusted EPS, an increase of 7.3% compared to the prior year. Normalized FFO per share was $0.64 or 8.5% higher versus the same period in 2011. EPS and FFO per share have been adjusted to remove the REIT conversion cost and favorable impact on our Q4 tax rate resulting from a partial reduction of the deferred tax items resulting from our corporate restructuring at the end of 2012. Fourth quarter EPS and FFO per share exceeded our expectations, primarily due to lower than anticipated operating expenses. The lower than anticipated operating expenses were partially the result of a $3 million reduction in operating expenses from a settlement of a supplier dispute. This translates into a $0.02 favorable impact on Q4 EPS that won’t be duplicated in Q1 of 2013. So for 2013 financial modeling purposes, we really need to think about Q4 is a $0.42 quarter free pass $0.62 for FFO. More on that in a minute. Moving next to discussion of our guidance for 2013, as indicated in the press release Q1 2013 adjusted EPS guidance is in range of $0.47 to $0.48. Adjusted EPS guidance for the full year is in the range of $2.05 to $2.15. Q1 FFO guidance $0.66 to $0.68. Full year FFO guidance $2.80 to $2.90, first quarter AFFO guidance $0.64 to $0.66, full year AFFO guidance $2.72 to $2.87. Guidance excludes REIT conversion cost, debt refinancing cost, reversal of deferred tax items associated with the REIT conversion as well as the impact of any shares to be issued as part of E&P dividend. For more specifics on those items related to the REIT conversion, we would refer you to the press release and…

All right. Thanks very much Todd. Now it’s for our market assessment and also outlook for the business. Now let me first just make a global comment, I’m reading all the same headline says you all. There is lot of mixed messages out there right now as relates to the economy and kind of the national environment. So we continued to opt to monitor very closely and have concerns like many people about potential slowdown or other challenges to potentially lead into a recession. So we continue to be very cautious in the near term about the business and looking at this national environment. But let me just give you a little bit of an observation both on the state side of business and also the federal side of business. And for the first of state side a few updates since we talked last November. First of which is just to restate what I said earlier, we’re very excited about our new Arizona contract. Again, this is going to be utilized in existing capacity at our Red Rock facility that’s currently being occupied by the State of California. And one thing I will notice that, we are working through the course of the year doing some upgrades for this facility to meet all the requirements of this new Arizona contract. So this will be an ongoing priority for the company during the course of 2013. But also let me provide a few global comments on the state side. First of which is to say that for the new fiscal year that started this past July, there has been no new meaningful new capacity being funded except for Arizona and California. And this is the third consecutive year of minimal preparations for new state capacity. Now we’re expecting the same environment…

(Operator Instructions) And we will go first to Manav Patnaik.

Hey good morning, everybody. Thank you so much for the color, and you just try to find all the stuff going on in California it’s been a little confusing. But just related to that and what’s baked in your guidance I think last week you talked about the assumption was basically one that you made because either way you have to move the inmates out to vacate for Arizona, I was wondering have you notified California of your intent to do this, and have they in any way responded saying, okay, we’ll take it back or just move it to your other facility?

Good couple questions, Manav. So, let me answer that – this is Damon. So, we have made California aware all along the way as we went forward on pursuing the Arizona contract, so from day one when we submit a proposal in advance to submit a proposal I should say, we made California aware and their role were that with that type of opportunity where you had a contract potentially with Arizona for 20-year term and guarantees that would be a very attractive for us, since we had this uncertainty going on with California. So, every step of the way we’ve made them aware and they know about the Arizona contract award and they know that we would start taking inmates the first of next year. The second point, I would say is that, they have not formally given us indication that they’re going to take all 1,500 inmates back into the state. We’ve got that in the plan just because we have to get the inmates out by the end of this year because Arizona will not let any kind of cross mixing of population, so that is in the guidance. We have to get the population off by the end of the year. We haven’t received anything formally from the State of California. So there will be ongoing discussion as we go into the year and as they react to a likely order from the region three-judge panel and also we’re we’ll prepared to deal with what their needs are, so if they have a need for those 1,500 inmates that remain out of state, we also have capacity in our system that we can provide to them and stand ready to do that, so again will get more clarity I think as we going to the spring or into the early summer. One other thing I would note is that, we’ve got a contract for about 9,000 beds for the State of California and we’ve been right at about 99% for quite some time, so they’ve been utilizing all of our capacity here in the near term, even as all the stuff circling with the three-judge panel in the actions by the court.

Got it. And can you remind us on the Arizona schedule, if I remember correctly it was 1,000-bed contract, but 500 stock like Jan 1st of ‘14, and then another 500 another year later, is that what you still expect?

That’s correct.

Okay. And then just on the sequestration stuff, you made some comments this time when you talked about it before as well, do you guys have any idea or guidance around if anything in there could directly or maybe indirectly impact sort of your customers, and may be some of your contracts just curious if there’s any way to read through that at all?

Yeah, good question. So couple of observations there, one of which is that we had as a dry run through this potential threat here late last year, so as you know sequestration was supposed to go into effect on January 1st, and in the days weeks leading up to that date before the compromise was worked out between the administration and Congress, we didn’t see any notable changes with our customers, how they were doing business, in fact we are observing and basically they were looking just kind of at a status quo. I think one key reminder on sequestration is that the cuts have to be affected sometime during the fiscal year. It’s not necessarily the case that on March 1 all of these cuts have to be put in place. So, if there is a budget reduction that – a customer or if he has to do, they’ve got the rest of the fiscal year to do that, they don’t have to do that on day one. So that’s one I think important reminder. And then I guess the last point, part of your question is so we’ve got two kind of – two key days you’ve got sequestration, which is due to go to and in effect on March 1st and then you got continued resolution that goes through end of March. So there is – and I think is why they report on media, there is one group of thought that sequestration comes to pass on March 1, you have the administration and congress work through the month of March to work out a – some type of compromise both the risk and sequestration, but also a funding bill for the rest of the fiscal year and that gets worked out before the March – end of March continued resolution expiring. So, we’re up to continue monitor it very closely, but to your first part of your question, I think we’ve got a pretty good sense of how our customers reacted with the last brass blast sequestration on January 1st.

Okay. Got it. And one last just sort of housekeeping one for Todd. You already gave us sort of the depreciation of real estate assets is about 77 million. Can you just help us fill the gap in between your sort of total guidance is slightly increased like what the other depreciation number should be?

So, full year 2012 was around $114 million and we’ve guided to a slight increase, so that you know, 2 to $4 million on top of that, for total depreciation.

Okay. All right, fair enough. Thank you guys.

Thanks, Manav.

And moving on, well go next to Kevin McVeigh of Macquarie. Kevin McVeigh – Macquarie: Great. Thanks. Could you remind us if California doesn’t put those 1500 beds back to you, what would that suggest in terms of upside to current estimates?

We haven’t given any estimate as it relates to what the impact would be and again depends on kind of the timing and exactly what they want to do and also depends on exactly what we do for them, and so let me explain that specifically. So if we utilize capacity at facilities that’s partially utilized, we’ve got some big capacity and we can increase the (inaudible) percentage that could be a little more of upside this year. But if we have to go to a vacant facility and started up, then that would be potential a little more of a drag this year, but up to be upside for ‘14. So again depends on exactly what their need is, the timing of which is an ultimate what we propose as a solution Kevin McVeigh – Macquarie: Got it. And then just with kind of Arizona taking over some of those California beds. Is that – would you kind of view that as a longer term strategy just given the uncertainty around California to kind to try to proactively replace those beds or is it ultimately going to depend on what – how their realignment settles?

Little bit of both. So, we have been working really hard and our partnership development folks have been working hard on. When we look at the portfolio of beds currently utilized by State of California, we’re always looking at opportunities where we could have a solution that’s a little more longer-term and lowers the risk profile. And again Arizona is a great example of that, because they’re offering a 20 year contract with the 19 guarantee. And California stands at two, again as I mentioned earlier to Manav, we are in consequent communication with California educating them on that point. And they understand that. They understand obviously with everything circling it’s hard for them to give us a lot of certainty relative to their needs out-of-state. So, it’s a very good collaborative discussion with California and again we’re always looking at opportunities to lower that risk profile. We can now have contracts like Arizona utilizing existing capacity that California is currently in. Kevin McVeigh – Macquarie: Got it. And then just one other – one around capital structure obviously I know we need to do the E&P and part of that is amending some of the debt. As you think about the capital structure going forward, have there been different conversations posted positive PLR as you’re thinking about be it terming out some debt or just any thoughts on cost capital structure relative to the PLR and then ultimately any sense of timing on kind of the E&P post clarity on debt.

Sure. I’ll take that one, Kevin this is Todd. Kevin McVeigh – Macquarie: Hey, Todd.

Obviously, we’ve given a lot of thought to the capital structure but will continue to update our assessment of various issues such as the appropriate levels of liquidity, the outflow mix of variable-rate debt, fixed rate debt, optimal mix of bank debt versus bond debt, the amount of covenant flexibility we desire and are willing to pay for and the length of the debt maturities all of which can be influenced by potential changes in market conditions which could have an impact on interest expense. Anyways with regard to the E&P dividend we would expect to make that distribution sometime after we complete the refinancing. Kevin McVeigh – Macquarie: Okay. Thank you very much.

And we’ll move on to Clara Evan with Avondale Partners Kevin Campbell – Avondale Partners: This is actually Kevin. I had a question for you guys just on the index inclusion. Are there any requirements at this point that you guys haven’t met you know do you have to make your E&P distribution beforehand? Any other requirements that still need to be made that you have to check the box on?

Kevin this is Todd. Again when we have spoken with the index managers there’s I think intentionally vague on some of the decision-making they will typically refer you to their published methodology which isn’t always clear around the issues they consider. When making decisions around whether or not to include company and went to include that company but it is possible that one or more they want to see the distribution of the NP dividend before they pick this up for inclusion. Kevin Campbell – Avondale Partners: Okay. And I don’t know if these indexes were even around back then but was PCN included in any of the read indexes that were around in the 90s?

I believe they were. I can tell you which one so. Kevin Campbell – Avondale Partners: I’m curious to sort of separately bigger picture on ICE, immigration reform obviously has been a topic that you know under the forefront here in the first part of this year so I’m curious what you’re hearing on immigration reform and how that could look and knowing that its obviously very early stages?

Good morning, Kevin. This is Damon. Let me tackle that one. I don’t have any really new information or additional insight than what’s been reported more globally in the national media. But I will say that generally, talking with ICE whose has been a partner for us for many, many years, I think they’re just general belief is that there’s always going to be a demand for beds. Now their profile of detainees in those beds may change over time to where they focus more on what they call criminal aliens versus non-criminal aliens, so that may change over time from – from time to time I should say based on both the demand and maybe any policy value administration. But I guess yes, my last point would be what you just said at the end, I think its too early to tell exactly what the impacts going to be, but again, generally ICE has always said that there’s going to be a demand for bed space here in the U.S. because of all the things we’re doing both within the interior, on the border, from the people that are released from state prisons that are ultimately need to be deported there’s always going to be strong demand, regardless of what’s been done at the national role of this immigration reform, but again it’s too early to tell and what to monitor closely. Kevin Campbell – Avondale Partners: And Todd you mentioned last week that the investment grade ratings for your debt is important to you. Could you maybe tell us some of the steps that you’re taking for that and if you are achieve it what that means financially for the firm?

Second part first; think it means a lower average cost of debt capital. And I think it could also favorably impact our cost of equity capital by improving our if you see financial position. In terms of the steps we need to take, we are continuing a dialogue with the rating agency; he’s got a great group of analyst there, very accessible, very knowledgeable around the business. And now that we’ve formally converted to a REIT we’ll continue to press our take with them, funny how we comp very well compared to the average REIT. The average REIT include, a lot of the investment grade REITs have leverage in excess of five times or three times and coverage ratio is down around three times or we’re approaching seven time, so I think we’ve got a lot of strong arguments to make that will likely take some time and they are independent as you know they got their own perspectives and methodologies, but we’ll continue to push – make those arguments and push that case forward. Kevin Campbell – Avondale Partners: And in terms of impacting your sort of cost to borrowing, though when you need to get that done before you came to market with a new debt?

Yeah, great follow up question. We are not going to see any movement on the rating agencies before we’re going to market. That’s going to be hit, it’s probably at least 12 months before they would even consider making a change based on our REIT conversions. That will be a longer-term process decision-making process with the rating agencies. Kevin Campbell – Avondale Partners: And then the benefit then to obviously is over the longer term your cost of borrowing.

Yeah. Kevin Campbell – Avondale Partners: Okay, I’m curious on Michigan, RP how you feel about your ability to compete there, I didn’t – if you said this previously, I’m sorry, I missed it, but would you be submitting it as a management contract and you would partner with the state on an existing facility or would you be able to purchase one of these states – facility?

Yeah, good question, Kevin. This is Damon again. So RP just came out, so we’ll still assessing the procurement itself, and the requirements I think the two were of the existing state facilities until later this month. So as we understand it, it’s really not an opportunity to acquire facility you really just have two ways to propose a solution to this state, one of which is to propose own capacity in state and of course we don’t have the capacity in Michigan, so we wouldn’t be able to compete on that part of the proposal but the other possible proposal is to use an existing state owned facility and proposed management of that housing of about 1000 inmates, so basically we have managed only opportunity. So again we’re still assessing it and taking a look at it, again, I think the two were our facilities that’s owned by the states a little later this month, so we’ll give updates along the way. Kevin Campbell – Avondale Partners: Okay great. Thank you very much.

Absolutely. Thanks Kevin.

Our next question today is from Tobey Sommer at SunTrust Tobey Sommer – SunTrust: Thank you. A lot of my questions have been answered. And I just wanted to ask at this stage of the state budget cycle with some of the healing that’s going on. How do you think about that vis-à-vis demand for your services.

Yeah, great question, so couple observations, so one of which is what I said earlier that we’re seeing a play out even though budgets are improving, we’re seeing a play out to our where states property in very little, if any money for new capacity. And we – as I mentioned earlier we are seeing states a double-digit number in our portfolio that are growing by 5,000 this past year. So I think that’s an encouraging sign, I think one of which is that we’re making good progress on showing states that we can provide a solution versus inmates in the capital investment to deal with our growth.

The other thing I would say is that we are seeing a little bit of improvement on the budgets as it relates to going ahead and buying some the beds. And I think a good example as I think about our state portfolio is Oklahoma. This is a state that has been dealing with a little of bit overcrowding for last year’s. But they’ve had a challenging fiscal environment. So them going out now and procuring some beds in our portfolio this past year, I think is an encouraging signs that they now feel like, okay, we’ve overcrowded for a little bit, but now we can reduce a little bit in our system and now take advantage of some beds within CCA. And then the third point is little bit to what I mentioned earlier is that I’m a little more encouraged, again, can’t bite the ball yet, but I’m a little more encouraged that we’re seeing state budgets coming out to where we’re seeing escalators within our state contracts that are due to increase on July 1. Again, these are initial proposals, they have to work their way through legislature. But seven of our 16 showing per day increases I think is encouraging sign. Again, we had a lot of work still to do, and they’re still not at levels they were a few years ago, but I think its going in the right direction. Tobey Sommer – SunTrust: Thank you. That’s helpful. And if I think about the opportunities that you have sometimes that materialize direct negotiations as opposed to RFP processes. In the context of where the state budgets are how do you feel about those opportunities – in the frequency of those opportunities to increase relative to the trend of the last couple years?

I would say its slightly better again, slightly better. So Puerto Rico is a great example. Puerto Rico we had in that list of fixed prospective states that we didn’t mention my name and then got it across the finish line with the new contract last year. There’s a couple other states that I would say are kind of in that, not the same category where they’re growing and overcrowding. But also their budget environment is a tad better, so they may be feeling a little better, they could reduce the overcrowding their system, so I’d say again it’s not dramatic, but it is a slight improvement. Tobey Sommer – SunTrust: Under a REIT structure do you feel that the sale of an existing facility by a customer is more likely or enhanced in some way by the structure or is it a neutral impact?

I would say a neutral maybe a tad better than that, but as Todd mentioned earlier as we think about our capital structure, if we get good movement on our cost to capital and see the improvement in rating agencies of again what that’s on it to do less for the management team. Then if our cost of capital is slightly better than that makes our buy proposition slightly better, but I would its generally I’d say neutral. Tobey Sommer – SunTrust: Okay. Thank you very much.

Thanks, Tobey.

And we will move onto Clint Fendley at Davenport. Sir. Clint Fendley – Davenport: Good morning guys. Thanks for taking my question, one question on California, I wondered if you think we’d see the demand for beds changing in California if the population caps were placed on individual prisons rather than the reporting that is currently done on a statewide average?

Yeah, that’s a great question. You may have seen in the filing by the plaintiffs a suggestion to that so for the rest of the audience the cap is for their whole system wide population which is 32 facilities. There’s been some suggestion including by the plaintiffs that that cap is for each individual facility. So that would potentially create some more challenges for the state of California. But to answer your question assuring you I don’t know if they have their requirement they have to do that by facility versus system wide it could create some challenges for them in manifest itself into an opportunity for CCA. Again it’s one of the many different outcomes and as I said earlier we stand ready to support the state as they see fit as they do with this potential action by the court. Clint Fendley – Davenport: Could you maybe even help us understand I’ve read some reports that have indicated that some of their individual prisons capacity is as high as 180% currently I mean, does that mean that they have shifted some of these inmates over to newer facilities, is that allowed them to maybe manage them more efficiently or how should we think about that?

It’s probably a combination of all the above it’s probably looking at classification. So they may be willing to do a little higher percentage on a lower custody population versus higher custody population. It could be to your point newer facilities versus older facilities newer facilities maybe be with a lot more technology and secure hardware and technology could allow them to a little high percentage, so it’s probably a combination of many different factors, both age of facilities, location of facility, from a staffing perspective and then also the classification of inmate. Clint Fendley – Davenport: Okay, thanks. And one last question here, I wondered if you could remind us, do you have labor costs that are indexed to the minimum wage, and if so, do your contract provisions address that if it were to rise to $9 as has been proposed?

We do not have them indexed. Many of our federal contracts are driven by Department of Labor, so those rates are determined by Department of Labor and then we’re able to get adjustments based on any increases by Department of Labor, but not on our state side, they’re not indexed to minimum wage. Clint Fendley – Davenport: Okay. Thank you, guys.

Thank you.

And we will go back to Kevin McVeigh, Macquarie Kevin McVeigh – Macquarie: Hi. Can you hear me.

Yeah.

Yes, sir. Go ahead. Thanks. Kevin McVeigh – Macquarie: Sorry about that. Damon, if you get those per diem increases on the seven to 16 state that are showing that, is that factored into the ‘13 guidance or would that be additional upside?

That will be factored in. Kevin McVeigh – Macquarie: So it’s factored in already or would suggest additional upside if it were successful with those per diems.

We factor it in. Kevin McVeigh – Macquarie: You did. Okay. Super. Thank you.

And that is all the time we have for questions today. Mr. Hininger, I’d like to turn the call back over to sir for any additional or concluding remarks.

All right. Thanks again, Lorrie and appreciate everyone’s participation in today’s call. We are very excited about the results we had in 2012, most notably, the accomplishment of our conversion to our Real Estate Investment Trust. Let me just also say, as always, very thankful for the investors on the call and your investment in CCA. As always, your management team here in the room and throughout the organization we’re working very hard to execute on another good quarter and another year – another good year for 2013, and we look forward to reporting progress during the course of the year. So thanks again for your participation this morning. Goodbye.

Once again, ladies and gentlemen, that does conclude our conference for today. I would like to thank everyone for joining us.