Target Hospitality Corp. (NASDAQ:TH) announced today that the U.S. government plans to terminate the South Texas Family Residential Center (STFRC) services agreement.

This contract, set to end on August 9, 2024, involves Target providing facility and hospitality services to a migrant programming partner.

Despite the contract termination, Target will retain ownership of these modular assets, allowing the company to continue using these solutions to meet customer demand across its existing operating segments and explore other potential growth opportunities.

Target plans to provide operational and financial updates reflecting the impact of this termination before June 30, 2024.