Correctional Services Corp. Announces Results for the Quarter and Year Ended Dec. 31, 1998.

SARASOTA, Fla.--(BUSINESS WIRE)--March 9, 1999--Correctional Services Corp. (NASDAQ/NMS: CSCQ) today announced revenues for its fourth quarter and year-end grew by 74% and 63%, respectively. Net income, exclusive of the effect of the adoption of the American Institute of Certified Public Accountant's Statement of Position (SOP 98-5) - Accounting for Start-up Costs, jumped 46% and 64% in the fourth quarter and year-end, respectively. The company also noted that it grew its beds under contract by over 130% in 1998.

In the fourth quarter of 1998 the company adopted SOP 98-5, which required it to record a cumulative effect of change in accounting of $8,043,380 retroactively to its first quarter of 1998, and a current year effect of expensing start-up and deferred development costs as incurred throughout the remainder of the year. The required adoption of SOP 98-5 effects many industries, including the one in which the company operates.

For the fourth quarter 1998, the company's revenues were $30,351,266 with net income of $261,133 after the expensing of $2,391,440 in start-up and development costs. Net income, exclusive of the effect of SOP 98-5, was $1,320,117 or $.16 per share versus $1,122,457 and $.14 per share (which included a $216,584 or $.03 benefit in capitalized interest) in the year earlier period.

For the year ended Dec. 31, 1998 revenues were $97,928,498 with a net loss of ($6,022,207) after the cumulative effect of change in accounting discussed earlier and the expensing of start-up and development costs throughout the year. Net income, exclusive of the effect of the change in accounting, was $4,616,276 or $.56 per share compared to $3,025,524 or $.37 per share in 1998.

Commenting on the year and quarter James F. Slattery, CEO and president stated, "1998 was a year of extraordinary achievement for our company. The reputation of our company in both the Juvenile and Adult markets led to tremendous growth. In 1998 we opened 13 new facilities representing 5,300 beds which more than doubled our size. Our success was broad based as we took over the operations of the largest privatized juvenile facility in the country and opened one of the largest privately run adult female facilities."

Slattery further stated, "Our leadership position in the Juvenile market remains strong as we begin to offer a broader base of services to governmental agencies. The pending merger with Youth Services International will only enhance this position. In 1998 we achieved the highest award success rate in our history."

Correctional Services Corporation is a leading developer and manager of privatized correctional and detention facilities in the United States. The company provides a diverse range of adult and juvenile programs and services to local, state and federal governmental agencies. The company has 37 contracts to manage facilities in 12 states and Puerto Rico with an aggregate of 9,790 beds.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This press release contains forward-looking statements involving various risks and uncertainties. Actual results could differ materially from those projected due to factors which may include population fluctuations, acquisition risks, market conditions, government funding and availability of financing. There can be no assurance that the merger will be consummated. Even if consummated, actual results, including the level of earnings of both CSC and YSI, and the success of the proposed merger, could differ materially from those projected due to factors which may include difficulties in the assimilation of operations, diversification of management's attention from other business concerns, other acquisition risks, population fluctuations, market and industry conditions, government funding and availability of financing. These and other risk factors are outlined in the reports filed by the company with the Securities and Exchange Commission. -0-

          CORRECTIONAL SERVICES CORPORATION AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                         Three Months Ended           Year Ended
                            December 31,              December 31,
                       ----------------------- -----------------------
                          1998 (1)     1997       1998 (1)     1997
                       ----------- ----------- ----------- -----------

Revenues               $30,351,266 $17,415,842 $97,928,498 $59,936,101
                       ----------- ----------- ----------- -----------
Expenses:
  Operating             22,389,388  12,608,877  71,255,339  43,472,402
  General and
   administrative        4,903,319   3,180,795  16,264,107  11,859,399
  Startup and deferred
   development           2,391,440              11,629,841
                       ----------- ----------- ----------- -----------
                        29,684,147  15,789,672  99,149,287  55,331,801
                       ----------- ----------- ----------- -----------
Operating income (loss)    667,119   1,626,170  (1,220,789)  4,604,300

Interest income
  (expense), net (2)      (235,494)    299,140    (693,739)    444,077
                       ----------- ----------- ----------- -----------
Income (loss) before
  income taxes and
  cumulative effect of
  change in accounting     431,625   1,925,310  (1,914,528)  5,048,377
Income tax (provision)
  benefit                 (170,492)   (802,853)    755,700  (2,022,853)
                       ----------- ----------- ----------- -----------
Income (loss) before
  cumulative effect of
  change in accounting     261,133   1,122,457  (1,158,827)  3,025,524
Cumulative effect of
  change in accounting,
  net of tax                                    (4,863,380)
                       ----------- ----------- ----------- -----------
Net income (loss)      $   261,133 $ 1,122,457 ($6,022,207)$ 3,025,524
                       =========== =========== =========== ===========
Basic earnings (loss)
  per share:
  Income (loss) before
   cumulative effect of
   change in accounting      $0.03       $0.15      ($0.15)      $0.39
  Cumulative effect of
   change in accounting      $0.00       $0.00      ($0.63)      $0.00
                       ----------- ----------- ----------- -----------
     Net income (loss)       $0.03       $0.15      ($0.78)      $0.39
                       =========== =========== =========== ===========
Diluted earnings per share:
  Income (loss) before
   cumulative effect of
   change in accounting      $0.03       $0.14      ($0.15)      $0.37
  Cumulative effect of
   change in accounting      $0.00       $0.00      ($0.63)      $0.00
                       ----------- ----------- ----------- -----------
     Net income (loss)       $0.03       $0.14      ($0.78)      $0.37
                       =========== =========== =========== ===========

Number of shares used to
  compute EPS:
     Basic               7,791,719   7,689,789   7,761,224   7,675,220
     Diluted             8,140,452   8,134,643   7,761,224   8,117,922

(1)  The 1998 figures include the effect of the adoption of the AICPA
     Statement of Position (SOP) 98-5, Accounting for Startup Costs.
(2)  The fourth quarter and year end 1997 interest number included
     $371,500 of interest income related to the capitalization of
     interest in accordance with FASB Statement number 34,
     Capitalization of Interest Cost.

Beds under management
 (end of period)             9,477       3,904       9,477       3,904
Compensated mandays        633,273     346,080   2,006,035   1,115,041

SELECTED  BALANCE  SHEET  DATA

                               December 31,   December 31,
                                  1998           1997
                               -----------    -----------
Working Capital                $12,158,989    $ 6,692,000
Total Assets                   $66,708,974    $55,866,000
Total Liabilities              $28,786,479    $12,678,000
Shareholders' Equity           $37,922,364    $43,188,000