Business Segments and Geographic Information

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Business Segments and Geographic Information

Business Segments and Geographic Information

Operating and Reporting Segments

The Company conducts its business through four reportable business segments: the U.S. Corrections & Detention segment; the International Services segment; the GEO Community Services segment; and Facility Construction & Design segment. The GEO Community Services segment was previously referred to as the GEO Care segment but was renamed concurrent with the divestiture of RTS (refer to Note 2 - Discontinued Operations). All current and prior year financial position and results of operations amounts presented for this segment are referred to as GEO Community Services. The Company has identified these four reportable segments to reflect the current view that the Company operates four distinct business lines, each of which constitutes a material part of its overall business. The U.S. Corrections & Detention segment primarily encompasses U.S.-based privatized corrections and detention business. The International Services segment primarily consists of privatized corrections and detention operations in South Africa, Australia and the United Kingdom. The Company’s community-based services, youth services and BI are operating segments aggregated under the GEO Community Services reporting segment. The GEO Community Services segment, which conducts its services in the United States, represents services provided to adult offenders and juveniles for non-residential treatment, educational and community based programs, pre-release and half-way house programs, compliance technologies, monitoring services and evidence-based supervision and treatment programs for community-based parolees, probationers, and pretrial defendants. The Facility Construction & Design segment primarily contracts with various state, local and federal agencies for the design and construction of facilities for which the Company has management contracts. Generally, the assets and revenues from the Facility Construction & Design segment are offset by a similar amount of liabilities and expenses. As a result of the acquisition of Cornell, management’s review of certain segment financial data was revised with regards to the Bronx Community Re-entry Center and the Brooklyn Community Re-entry Center. These facilities now report within the GEO Community Services segment and are no longer included with U.S. Corrections & Detention. Segment disclosures below (in thousands) reflect the results of continuing operations. All transactions between segments are eliminated.

Fiscal Year	2012			2011			2010
Revenues:
U.S. Corrections & Detention	$	975,445		$	925,695		$	805,857
GEO Community Services	291,891			280,080			76,913
International Services	211,726			201,397			178,567
Facility Construction and Design	$	—		$	—		$	23,255
Total revenues	$	1,479,062		$	1,407,172		$	1,084,592
Depreciation and amortization:
U.S. Corrections & Detention	$	62,587		$	55,208		$	39,417
GEO Community Services	26,738			24,271			3,246
International Services	2,360			2,069			1,702
Total depreciation and amortization	$	91,685		$	81,548		$	44,365
Operating Income:
U.S. Corrections & Detention	$	222,703		$	215,406		$	198,837
GEO Community Services	65,401			61,270			15,877
International Services	10,041			12,938			11,364
Facility Construction & Design	—			—			2,382
Operating income from segments	298,145			289,614			228,460
General and Administrative Expenses	(113,792		)	(110,015		)	(101,558		)
Total operating income	$	184,353		$	179,599		$	126,902

	2012		2011
	(In thousands)
Segment assets:
U.S. Corrections & Detention	$	1,967,226	$	2,022,600
GEO Community Services	673,397		688,240
International Services	97,584		93,732
Facility Construction & Design	—		157
Total segment assets	$	2,738,207	$	2,804,729

Pre-Tax Income Reconciliation of Segments

The following is a reconciliation of the Company’s total operating income from its reportable segments to the Company’s income before income taxes, equity in earnings of affiliates and discontinued operations, in each case, during the fiscal years ended December 31, 2012, January 1, 2012 and January 2, 2011, respectively.

Fiscal Year Ended	2012			2011			2010
	(In thousands)
Operating income from segments	$	298,145		$	289,614		$	228,460
Unallocated amounts:
General and administrative expense	(113,792		)	(110,015		)	(101,558		)
Net interest expense	(75,473		)	(68,346		)	(34,452		)
Loss on Early Extinguishment of Debt	(8,462		)	—			(7,933		)
Income before income taxes, equity in earnings of affiliates and discontinued operations	$	100,418		$	111,253		$	84,517

Asset Reconciliation

The following is a reconciliation of the Company’s reportable segment assets to the Company’s total assets as of December 31, 2012 and January 1, 2012, respectively.

	2012		2011
	(In thousands)
Reportable segment assets	$	2,738,207	$	2,804,729
Cash	31,755		43,378
Deferred income tax	20,822		30,017
Restricted cash and investments	48,410		99,459
Assets of discontinued operations	—		72,340
Total assets	$	2,839,194	$	3,049,923

Geographic Information

During each of the fiscal years ended December 31, 2012, January 1, 2012 and January 2, 2011, the Company’s international operations were conducted through (i) the Company’s wholly owned Australian subsidiary, The GEO Group Australia Pty. Ltd., through which the Company has management contracts for four correctional facilities (ii) the Company’s consolidated joint venture in South Africa, SACM, through which the Company manages one correctional facility; and (iii) the Company’s wholly-owned subsidiary in the United Kingdom, The GEO Group UK Ltd., through which the Company managed both the Dungavel House Immigration Removal Centre and the Harmondsworth Immigration Removal Centre as of January 1, 2012 and managed both the Campsfield House Immigration Removal Centre and the Harmondsworth Immigration Removal Centre as of December 31, 2012 and January 2, 2011.

Fiscal Year	2012		2011		2010
	(In thousands)
Revenues:
U.S. operations	$	1,267,335	$	1,205,775	$	906,025
Australia operations	159,444		150,753		130,738
South African operations	20,029		21,357		19,231
United Kingdom operations	32,254		29,287		28,598
Total revenues	$	1,479,062	$	1,407,172	$	1,084,592
Long-lived assets:
U.S. operations	$	1,680,038	$	1,683,124
Australia operations	5,634		4,296
South African operations	234		334
United Kingdom operations	1,253		602
Total long-lived assets	$	1,687,159	$	1,688,356

Sources of Revenue

The Company derives most of its revenue from the management of privatized correction and detention facilities. The Company also derives revenue from GEO Community Services and from the construction and expansion of new and existing correctional, detention and GEO Community Services facilities. All of the Company’s revenue is generated from external customers.

Fiscal Year	2012		2011		2010
	(In thousands)
Revenues:
Corrections & Detention	$	1,187,171	$	1,127,092	$	984,424
GEO Community Services	291,891		280,080		76,913
Facility Construction and Design	—		—		23,255
Total revenues	$	1,479,062	$	1,407,172	$	1,084,592

Equity in Earnings of Affiliates

Equity in earnings of affiliates for 2012, 2011 and 2010 includes the operating results the Company’s joint ventures in SACS and GEOAmey. These joint ventures are accounted for under the equity method and the Company’s investments in SACS and GEOAmey are presented as a component of other non-current assets in the accompanying consolidated balance sheets.

The Company has recorded $5.3 million, $3.9 million and $4.2 million in earnings, net of tax impact, for SACS operations during the fiscal years ended December 31, 2012 and January 1, 2012, and January 2, 2011,respectively, which are included in equity in earnings of affiliates, net of income tax provision in the accompanying consolidated statements of comprehensive income. As of December 31, 2012 and January 1, 2012, the Company’s investment in SACS was $7.8 million and $5.6 million, respectively. The investment is included in other non-current assets in the accompanying consolidated balance sheets.

The Company has recorded $(1.7) million and $(2.4) million in losses, net of tax impact, for GEOAmey’s operations during the fiscal years ended December 31, 2012 and January 1, 2012, respectively, which are included in equity in earnings of affiliates, net of income tax provision, in the accompanying consolidated statements of comprehensive income. As of December 31, 2012 and January 1, 2012, the Company’s investment in GEOAmey was $(4.1) million and $(2.4) million, respectively, and represents its share of cumulative reported losses. Losses in excess of the Company's investment have been recognized as the Company has provided certain loans and guarantees to provide financial support to GEOAmey (Refer to Note 15-Debt and Note 1 - Summary of Business Organization, Operations and Significant Account Policies - Note Receivable from Joint Venture.

Business Concentration

Except for the major customer noted in the following table, no other single customer made up greater than 10% of the Company’s consolidated revenues for the following fiscal years.

Customer	2012		2011		2010
Various agencies of the U.S Federal Government:	47	%	40	%	35	%

Credit risk related to accounts receivable is reflective of the related revenues.