Condensed Consolidating Financial Information (Tables)

6 Months Ended

Jun. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Three Months Ended June 30, 2019
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	233,539		$	498,406		$	61,639		$	(179,618	)	$	613,966
Operating expenses	189,310			392,023			51,453			(179,618		)	453,168
Depreciation and amortization	7,299			24,208			845			—			32,352
General and administrative expenses	17,813			24,752			4,706			—			47,271
Operating income	19,117			57,423			4,635			—			81,175
Interest income	3,497			2,180			7,716			(5,348		)	8,045
Interest expense	(23,127		)	(14,703		)	(6,450		)	5,348			(38,932		)
Loss on extinguishment of debt	(486		)	(790		)	(4,465		)	—			(5,741		)
Income (loss) before income taxes and equity in earnings of affiliates	(999		)	44,110			1,436			—			44,547
Income tax provision	239			3,550			743			—			4,532
Equity in earnings of affiliates, net of income tax provision	—			—			1,821			—			1,821
Income before equity in income of consolidated subsidiaries	(1,238		)	40,560			2,514			—			41,836
Income from consolidated subsidiaries, net of income tax provision	43,074			—			—			(43,074		)	—
Net income	41,836			40,560			2,514			(43,074		)	41,836
Net loss attributable to noncontrolling interests	—			—			78			—			78
Net income attributable to The GEO Group, Inc.	$	41,836		$	40,560		$	2,592		$	(43,074	)	$	41,914
Net income	$	41,836		$	40,560		$	2,514		$	(43,074	)	$	41,836
Other comprehensive income, net of tax	—			42			4,612			—			4,654
Total comprehensive income	$	41,836		$	40,602		$	7,126		$	(43,074	)	$	46,490
Comprehensive loss attributable to noncontrolling interests	—			—			73			—			73
Comprehensive income attributable to The GEO Group, Inc.	$	41,836		$	40,602		$	7,199		$	(43,074	)	$	46,563

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Three Months Ended June 30, 2018
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	202,186		$	474,966		$	67,256		$	(160,899	)	$	583,509
Operating expenses	161,122			381,040			56,534			(160,899		)	437,797
Depreciation and amortization	6,564			23,695			1,054			—			31,313
General and administrative expenses	16,281			25,738			5,429			—			47,448
Operating income	18,219			44,493			4,239			—			66,951
Interest income	3,406			1,447			8,908			(5,094		)	8,667
Interest expense	(19,073		)	(13,959		)	(8,407		)	5,094			(36,345		)
Loss on extinguishment of debt	(574		)	—			—			—			(574		)
Income before income taxes and equity in earnings of affiliates	1,978			31,981			4,740			—			38,699
Income tax provision	716			1,442			1,557			—			3,715
Equity in earnings of affiliates, net of income tax provision	—			—			2,341			—			2,341
Income before equity in income of consolidated subsidiaries	1,262			30,539			5,524			—			37,325
Income from consolidated subsidiaries, net of income tax provision	36,063			—			—			(36,063		)	—
Net income	37,325			30,539			5,524			(36,063		)	37,325
Net loss attributable to noncontrolling interests	—			—			96			—			96
Net income attributable to The GEO Group, Inc.	$	37,325		$	30,539		$	5,620		$	(36,063	)	$	37,421
Net income	$	37,325		$	30,539		$	5,524		$	(36,063	)	$	37,325
Other comprehensive income (loss), net of tax	—			625			(2,783		)	—			(2,158		)
Total comprehensive income	$	37,325		$	31,164		$	2,741		$	(36,063	)	$	35,167
Comprehensive loss attributable to noncontrolling interests	—			—			117			—			117
Comprehensive income attributable to The GEO Group, Inc.	$	37,325		$	31,164		$	2,858		$	(36,063	)	$	35,284

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Six Months Ended June 30, 2019
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	461,921		$	993,296		$	130,607		$	(361,191	)	$	1,224,633
Operating expenses	360,826			804,477			106,053			(361,191		)	910,165
Depreciation and amortization	14,718			48,392			1,711			—			64,821
General and administrative expenses	35,013			48,781			9,901			—			93,695
Operating income	51,364			91,646			12,942			—			155,952
Interest income	6,975			3,515			15,915			(9,964		)	16,441
Interest expense	(46,423		)	(28,551		)	(14,202		)	9,964			(79,212		)
Loss on extinguishment of debt	(486		)	(790		)	(4,465		)	—			(5,741		)
Income before income taxes and equity in earnings of affiliates	11,430			65,820			10,190			—			87,440
Income tax provision	528			5,929			2,915			—			9,372
Equity in earnings of affiliates, net of income tax provision	—			—			4,417			—			4,417
Income before equity in income of consolidated subsidiaries	10,902			59,891			11,692			—			82,485
Income from consolidated subsidiaries, net of income tax provision	71,583			—			—			(71,583		)	—
Net income	82,485			59,891			11,692			(71,583		)	82,485
Net loss attributable to noncontrolling interests	—			—			134			—			134
Net income attributable to The GEO Group, Inc.	$	82,485		$	59,891		$	11,826		$	(71,583	)	$	82,619
Net income	$	82,485		$	59,891		$	11,692		$	(71,583	)	$	82,485
Other comprehensive income (loss), net of tax	—			(605		)	7,507			—			6,902
Total comprehensive income	$	82,485		$	59,286		$	19,199		$	(71,583	)	$	89,387
Comprehensive loss attributable to noncontrolling interests	—			—			129			—			129
Comprehensive income attributable to The GEO Group, Inc.	$	82,485		$	59,286		$	19,328		$	(71,583	)	$	89,516

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Six Months Ended June 30, 2018
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	397,816		$	933,694		$	136,062		$	(319,146	)	$	1,148,426
Operating expenses	312,944			759,006			111,702			(319,146		)	864,506
Depreciation and amortization	13,024			48,138			2,077			—			63,239
General and administrative expenses	30,622			48,185			10,473			—			89,280
Operating income	41,226			78,365			11,810			—			131,401
Interest income	7,583			2,864			18,292			(10,973		)	17,766
Interest expense	(37,695		)	(28,419		)	(17,073		)	10,973			(72,214		)
Loss on extinguishment of debt	(574		)	—			—			—			(574		)
Income before income taxes and equity in earnings of affiliates	10,540			52,810			13,029			—			76,379
Income tax provision	893			3,742			3,835			—			8,470
Equity in earnings of affiliates, net of income tax provision	—			—			4,336			—			4,336
Income before equity in income of consolidated subsidiaries	9,647			49,068			13,530			—			72,245
Income from consolidated subsidiaries, net of income tax provision	62,598			—			—			(62,598		)	—
Net income	72,245			49,068			13,530			(62,598		)	72,245
Net loss attributable to noncontrolling interests	—			—			163			—			163
Net income attributable to The GEO Group, Inc.	$	72,245		$	49,068		$	13,693		$	(62,598	)	$	72,408
Net income	$	72,245		$	49,068		$	13,530		$	(62,598	)	$	72,245
Other comprehensive income (loss), net of tax	—			730			(1,526		)	—			(796		)
Total comprehensive income	$	72,245		$	49,798		$	12,004		$	(62,598	)	$	71,449
Comprehensive loss attributable to noncontrolling interests	—			—			176			—			176
Comprehensive income attributable to The GEO Group, Inc.	$	72,245		$	49,798		$	12,180		$	(62,598	)	$	71,625

CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

(dollars in thousands)

(unaudited)

	As of June 30, 2019
	The GEO Group, Inc.		Combined Subsidiary Guarantors		Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	4,716	$	—	$	16,845		$	—		$	21,561
Restricted cash and cash equivalents	851		—		55,492			—			56,343
Accounts receivable, less allowance for doubtful accounts	163,184		186,592		41,825			3,119			394,720
Contract receivable, current portion	—		—		13,944			—			13,944
Prepaid expenses and other current assets	1,019		37,478		9,768			(1,949		)	46,316
Total current assets	169,770		224,070		137,874			1,170			532,884
Restricted Cash and Investments	—		25,708		1,650			—			27,358
Property and Equipment, Net	841,260		1,222,261		84,704			—			2,148,225
Assets Held for Sale	705		3,902		—			—			4,607
Contract Receivable	—		—		365,208			—			365,208
Operating Lease Right-of-Use Assets, Net	24,754		106,526		736			—			132,016
Intercompany Receivable	965,511		238,050		25,732			(1,229,293		)	—
Deferred Income Tax Assets	798		27,928		1,198			—			29,924
Goodwill	—		775,954		403			—			776,357
Intangible Assets, Net	—		220,670		552			—			221,222
Investment in Subsidiaries	1,479,372		573,816		2,189			(2,055,377		)	—
Other Non-Current Assets	11,361		116,819		20,424			(78,267		)	70,337
Total Assets	$	3,493,531	$	3,535,704	$	640,670		$	(3,361,767	)	$	4,308,138
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable	$	18,083	$	67,982	$	5,192		$	—		$	91,257
Accrued payroll and related taxes	—		53,505		17,864			—			71,369
Accrued expenses and other current liabilities	28,829		132,868		27,639			(253		)	189,083
Operating lease liabilities, current portion	5,108		26,622		347			—			32,077
Current portion of finance lease liabilities, long-term debt and non-recourse debt	8,000		1,550		16,316			—			25,866
Total current liabilities	60,020		282,527		67,358			(253		)	409,652
Deferred Income Tax Liabilities	—		—		13,681			—			13,681
Intercompany Payable	106,062		1,086,737		35,070			(1,227,869		)	—
Other Non-Current Liabilities	2,362		153,949		3,768			(78,267		)	81,812
Operating lease Liabilities	20,199		82,256		389			—			102,844
Finance Lease Liabilities	—		3,779		—			—			3,779
Long-Term Debt	2,282,622		—		71,904			—			2,354,526
Non-Recourse Debt	—		—		320,306			—			320,306
Commitments & Contingencies and Other
Shareholders' Equity:
The GEO Group, Inc. Shareholders' Equity	1,022,266		1,926,456		128,922			(2,055,378		)	1,022,266
Noncontrolling Interests	—		—		(728		)	—			(728		)
Total Shareholders’ Equity	1,022,266		1,926,456		128,194			(2,055,378		)	1,021,538
Total Liabilities and Shareholders' Equity	$	3,493,531	$	3,535,704	$	640,670		$	(3,361,767	)	$	4,308,138

CONDENSED CONSOLIDATING BALANCE SHEET

(dollars in thousands)

	As of December 31, 2018
	The GEO Group, Inc.		Combined Subsidiary Guarantors		Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	4,468	$	7,873	$	18,914		$	—		$	31,255
Restricted cash and cash equivalents	2,854		—		48,824			—			51,678
Accounts receivable, less allowance for doubtful accounts	190,594		221,957		44,377			(11,402		)	445,526
Contract receivable, current portion	—		—		15,535			—			15,535
Prepaid expenses and other current assets	2,011		50,482		7,114			(1,839		)	57,768
Total current assets	199,927		280,312		134,764			(13,241		)	601,762
Restricted Cash and Investments	—		21,009		1,422			—			22,431
Property and Equipment, Net	845,291		1,227,223		86,096			—			2,158,610
Assets Held for Sale	705		1,929		—			—			2,634
Contract Receivable	—		—		368,178						368,178
Intercompany Receivable	990,365		150,710		22,407			(1,163,482		)	—
Deferred Income Tax Assets	798		27,928		1,198			—			29,924
Goodwill	—		775,955		404			—			776,359
Intangible Assets, Net	—		231,787		573			—			232,360
Investment in Subsidiaries	1,503,841		458,229		2,190			(1,964,260		)	—
Other Non-Current Assets	9,541		115,695		19,334			(78,710		)	65,860
Total Assets	$	3,550,468	$	3,290,777	$	636,566		$	(3,219,693	)	$	4,258,118
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable	$	13,566	$	72,128	$	7,338		$	—		$	93,032
Accrued payroll and related taxes	—		56,543		19,466			—			76,009
Accrued expenses and other current liabilities	23,565		168,231		25,615			(13,241		)	204,170
Current portion of finance lease liabilities, long-term debt and non-recourse debt	8,000		2,017		322,010			—			332,027
Total current liabilities	45,131		298,919		374,429			(13,241		)	705,238
Deferred Income Tax Liabilities	—		—		13,681			—			13,681
Intercompany Payable	142,055		989,856		31,571			(1,163,482		)	—
Other Non-Current Liabilities	1,395		152,815		6,981			(78,710		)	82,481
Finance Lease Liabilities	—		4,570		—			—			4,570
Long-Term Debt	2,321,384		—		75,843			—			2,397,227
Non-Recourse Debt	—		—		15,017			—			15,017
Commitments & Contingencies and Other
Shareholders' Equity:
The GEO Group, Inc. Shareholders' Equity	1,040,503		1,844,617		119,643			(1,964,260		)	1,040,503
Noncontrolling Interests	—		—		(599		)	—			(599		)
Total Shareholders’ Equity	1,040,503		1,844,617		119,044			(1,964,260		)	1,039,904
Total Liabilities and Shareholders' Equity	$	3,550,468	$	3,290,777	$	636,566		$	(3,219,693	)	$	4,258,118

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(dollars in thousands)

(unaudited)

	For the Six Months Ended June 30, 2019
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Consolidated
Cash Flow from Operating Activities:
Net cash provided by operating activities	$	130,455		$	31,924		$	54,688		$	217,067
Cash Flow from Investing Activities:
Insurance proceeds - damaged property	—			10,761			—			10,761
Proceeds from sale of property and equipment	—			112			192			304
Change in restricted investments	—			(4,816		)	—			(4,816		)
Capital expenditures	(12,002		)	(42,804		)	(604		)	(55,410		)
Net cash used in investing activities	(12,002		)	(36,747		)	(412		)	(49,161		)
Cash Flow from Financing Activities:
Proceeds from long-term debt	170,000			—			—			170,000
Payments on long-term debt	(213,926		)	—			—			(213,926		)
Payments on non-recourse debt	—			—			(326,942		)	(326,942		)
Proceeds from non-recourse debt	—			—			326,127			326,127
Taxes paid related to net share settlements of equity awards	(4,177		)	—			—			(4,177		)
Proceeds from issuance of common stock in connection with ESPP	252			—			—			252
Debt issuance costs	(4,656		)	—			(5,281		)	(9,937		)
Proceeds from stock options exercised	1,077			—			—			1,077
Dividends paid	(116,122		)	—			—			(116,122		)
Net cash used in financing activities	(167,552		)	—			(6,096		)	(173,648		)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	—			—			824			824
Net (Decrease) Increase in Cash. Cash Equivalents and Restricted Cash and Cash Equivalents	(49,099		)	(4,823		)	49,004			(4,918		)
Cash, Cash Equivalents and Restricted Cash and Cash Equivalents, beginning of period	54,666			4,823			24,983			84,472
Cash, Cash Equivalents and Restricted Cash and Cash Equivalents, end of period	$	5,567		$	—		$	73,987		$	79,554

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(dollars in thousands)

(unaudited)

	For the Six Months Ended June 30, 2018
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Consolidated
Cash Flow from Operating Activities:
Net cash provided by operating activities	$	118,354		$	37,087		$	24,812		$	180,253
Cash Flow from Investing Activities:
Proceeds from sale of property and equipment	—			—			1,717			1,717
Proceeds from sale of assets held for sale	—			3,797						3,797
Insurance proceeds - damaged property	—			4,036			—			4,036
Change in restricted investments	—			(1,490		)	—			(1,490		)
Capital expenditures	(68,607		)	(36,998		)	(1,459		)	(107,064		)
Net cash used in investing activities	(68,607		)	(30,655		)	258			(99,004		)
Cash Flow from Financing Activities:
Proceeds from long-term debt	245,000			—			—			245,000
Payments on long-term debt	(134,000		)	—			—			(134,000		)
Payments on non-recourse debt	—			—			(7,490		)	(7,490		)
Taxes paid related to net share settlements of equity awards	(4,391		)	—			—			(4,391		)
Proceeds from issuance of common stock in connection with ESPP	264			—			—			264
Debt issuance costs	(990		)	—			—			(990		)
Proceeds from stock options exercised	1,372			—			—			1,372
Payments for repurchases of common stock	(70,446		)	—			—			(70,446		)
Dividends paid	(115,017		)	—			—			(115,017		)
Net cash used in financing activities	(78,208		)	—			(7,490		)	(85,698		)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	—			—			(1,881		)	(1,881		)
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	(28,461		)	6,432			15,699			(6,330		)
Cash, Cash Equivalents and Restricted Cash and Cash Equivalents, beginning of period	54,666			4,952			73,927			133,545
Cash, Cash Equivalents and Restricted Cash and Cash Equivalents, end of period	$	26,205		$	11,384		$	89,626		$	127,215