Condensed Consolidating Financial Information (Tables)

9 Months Ended

Sep. 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 September 30, 2019
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	241,389		$	513,194		$	69,734		$	(192,738	)	$	631,579
Operating expenses	194,174			412,866			58,211			(192,738		)	472,513
Depreciation and amortization	7,303			24,352			764			—			32,419
General and administrative expenses	18,365			24,818			5,305			—			48,488
Operating income	21,547			51,158			5,454			—			78,159
Interest income	3,443			2,207			6,022			(4,986		)	6,686
Interest expense	(22,370		)	(14,382		)	(4,879		)	4,986			(36,645		)
Loss on extinguishment of debt	—			594			—			—			594
Income before income taxes and equity in earnings of affiliates	2,620			39,577			6,597			—			48,794
Income tax provision	295			3,006			1,836			—			5,137
Equity in earnings of affiliates, net of income tax provision	—			—			2,228			—			2,228
Income before equity in income of consolidated subsidiaries	2,325			36,571			6,989			—			45,885
Income from consolidated subsidiaries, net of income tax provision	43,560			—			—			(43,560		)	—
Net income	45,885			36,571			6,989			(43,560		)	45,885
Net loss attributable to noncontrolling interests	—			—			47			—			47
Net income attributable to The GEO Group, Inc.	$	45,885		$	36,571		$	7,036		$	(43,560	)	$	45,932
Net income	$	45,885		$	36,571		$	6,989		$	(43,560	)	$	45,885
Other comprehensive income (loss), net of tax	(2,777		)	42			(4,553		)	—			(7,288		)
Total comprehensive income	$	43,108		$	36,613		$	2,436		$	(43,560	)	$	38,597
Comprehensive loss attributable to noncontrolling interests	—			—			62			—			62
Comprehensive income attributable to The GEO Group, Inc.	$	43,108		$	36,613		$	2,498		$	(43,560	)	$	38,659

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Three Months Ended September 30, 2018
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	208,607		$	479,175		$	65,028		$	(169,280	)	$	583,530
Operating expenses	171,038			379,892			53,156			(169,280		)	434,806
Depreciation and amortization	6,742			23,621			934			—			31,297
General and administrative expenses	16,878			25,568			5,201			—			47,647
Operating income	13,949			50,094			5,737			—			69,780
Interest income	3,415			1,159			8,660			(4,806		)	8,428
Interest expense	(20,765		)	(13,714		)	(8,318		)	4,806			(37,991		)
Income (loss) before income taxes and equity in earnings of affiliates	(3,401		)	37,539			6,079			—			40,217
Income tax provision	162			2,446			1,115			—			3,723
Equity in earnings of affiliates, net of income tax provision	—			—			2,735			—			2,735
Income (loss) before equity in income of consolidated subsidiaries	(3,563		)	35,093			7,699			—			39,229
Income from consolidated subsidiaries, net of income tax provision	42,792			—			—			(42,792		)	—
Net income	39,229			35,093			7,699			(42,792		)	39,229
Net loss attributable to noncontrolling interests	—			—			60			—			60
Net income attributable to The GEO Group, Inc.	$	39,229		$	35,093		$	7,759		$	(42,792	)	$	39,289
Net income	$	39,229		$	35,093		$	7,699		$	(42,792	)	$	39,229
Other comprehensive income (loss), net of tax	—			(761		)	194			—			(567		)
Total comprehensive income	$	39,229		$	34,332		$	7,893		$	(42,792	)	$	38,662
Comprehensive loss attributable to noncontrolling interests	—			—			72			—			72
Comprehensive income attributable to The GEO Group, Inc.	$	39,229		$	34,332		$	7,965		$	(42,792	)	$	38,734

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Nine Months Ended September 30, 2019
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	703,310		$	1,506,490		$	200,341		$	(553,929	)	$	1,856,212
Operating expenses	555,000			1,217,343			164,264			(553,929		)	1,382,678
Depreciation and amortization	22,021			72,744			2,475			—			97,240
General and administrative expenses	53,379			73,599			15,205			—			142,183
Operating income	72,910			142,804			18,397			—			234,111
Interest income	10,418			5,722			21,937			(14,950		)	23,127
Interest expense	(68,793		)	(42,932		)	(19,082		)	14,950			(115,857		)
Loss on extinguishment of debt	(486		)	(197		)	(4,464		)	—			(5,147		)
Income before income taxes and equity in earnings of affiliates	14,049			105,397			16,788			—			136,234
Income tax provision	823			8,935			4,751			—			14,509
Equity in earnings of affiliates, net of income tax provision	—			—			6,645			—			6,645
Income before equity in income of consolidated subsidiaries	13,226			96,462			18,682			—			128,370
Income from consolidated subsidiaries, net of income tax provision	115,147			—			—			(115,147		)	—
Net income	128,373			96,462			18,682			(115,147		)	128,370
Net loss attributable to noncontrolling interests	—			—			181			—			181
Net income attributable to The GEO Group, Inc.	$	128,373		$	96,462		$	18,863		$	(115,147	)	$	128,551
Net income	$	128,373		$	96,462		$	18,682		$	(115,147	)	$	128,370
Other comprehensive income (loss), net of tax	(2,777		)	(563		)	2,959			—			(381		)
Total comprehensive income	$	125,596		$	95,899		$	21,641		$	(115,147	)	$	127,989
Comprehensive loss attributable to noncontrolling interests	—			—			191			—			191
Comprehensive income attributable to The GEO Group, Inc.	$	125,596		$	95,899		$	21,832		$	(115,147	)	$	128,180

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

(dollars in thousands)

(unaudited)

	For the Nine Months Ended September 30, 2018
	The GEO Group, Inc.			Combined Subsidiary Guarantors			Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenues	$	606,424		$	1,412,868		$	201,090		$	(488,426	)	$	1,731,956
Operating expenses	483,982			1,138,897			164,859			(488,426		)	1,299,312
Depreciation and amortization	19,766			71,759			3,011			—			94,536
General and administrative expenses	47,499			73,753			15,675			—			136,927
Operating income	55,177			128,459			17,545			—			201,181
Interest income	10,998			4,023			26,951			(15,778		)	26,194
Interest expense	(58,460		)	(42,133		)	(25,390		)	15,778			(110,205		)
Loss on extinguishment of debt	(574		)	—			—			—			(574		)
Income before income taxes and equity in earnings of affiliates	7,141			90,349			19,106			—			116,596
Income tax provision	1,055			6,188			4,950			—			12,193
Equity in earnings of affiliates, net of income tax provision	—			—			7,071			—			7,071
Income before equity in income of consolidated subsidiaries	6,086			84,161			21,227			—			111,474
Income from consolidated subsidiaries, net of income tax provision	105,388			—			—			(105,388		)	—
Net income	111,474			84,161			21,227			(105,388		)	111,474
Net loss attributable to noncontrolling interests	—			—			223			—			223
Net income attributable to The GEO Group, Inc.	$	111,474		$	84,161		$	21,450		$	(105,388	)	$	111,697
Net income	$	111,474		$	84,161		$	21,227		$	(105,388	)	$	111,474
Other comprehensive loss, net of tax	—			(31		)	(1,332		)	—			(1,363		)
Total comprehensive income	$	111,474		$	84,130		$	19,895		$	(105,388	)	$	110,111
Comprehensive loss attributable to noncontrolling interests	—			—			247			—			247
Comprehensive income attributable to The GEO Group, Inc.	$	111,474		$	84,130		$	20,142		$	(105,388	)	$	110,358

CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

(dollars in thousands)

(unaudited)

	As of September 30, 2019
	The GEO Group, Inc.		Combined Subsidiary Guarantors		Combined Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents	$	26,150	$	6,364	$	21,516		$	—		$	54,030
Restricted cash and cash equivalents	—		—		33,536			—			33,536
Accounts receivable, less allowance for doubtful accounts	145,803		189,421		39,641			3,119			377,984
Contract receivable, current portion			—		8,193			—			8,193
Prepaid expenses and other current assets	1,235		35,796		8,829			(2,004		)	43,856
Total current assets	173,188		231,581		111,715			1,115			517,599
Restricted Cash and Investments	—		26,500		7,228			—			33,728
Property and Equipment, Net	847,996		1,223,695		83,807			—			2,155,498
Assets Held for Sale	705		3,056		—			—			3,761
Contract Receivable	—		—		353,010			—			353,010
Operating Lease Right-of-Use Assets, Net	23,359		101,652		707			—			125,718
Intercompany Receivable	976,826		236,081		9,718			(1,222,625		)	—
Deferred Income Tax Assets	798		27,928		1,198			—			29,924
Goodwill	—		775,954		387			—			776,341
Intangible Assets, Net	—		215,112		495			—			215,607
Investment in Subsidiaries	1,465,543		573,816		2,190			(2,041,549		)	—
Other Non-Current Assets	10,445		119,925		19,368			(78,045		)	71,693
Total Assets	$	3,498,860	$	3,535,300	$	589,823		$	(3,341,104	)	$	4,282,879
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable	$	15,451	$	76,226	$	4,586		$	—		$	96,263
Accrued payroll and related taxes	—		40,297		17,477			—			57,774
Accrued expenses and other current liabilities	41,156		134,948		26,560			(308		)	202,356
Operating lease liabilities, current portion	5,151		23,282		362			—			28,795
Current portion of finance lease liabilities, long-term debt and non-recourse debt	8,000		2,560		12,857			—			23,417
Total current liabilities	69,758		277,313		61,842			(308		)	408,605
Deferred Income Tax Liabilities	—		—		13,681			—			13,681
Intercompany Payable	108,182		1,094,114		18,906			(1,221,202		)	—
Other Non-Current Liabilities	3,677		156,904		5,623			(78,045		)	88,159
Operating lease Liabilities	18,764		80,162		345			—			99,271
Finance Lease Liabilities	—		3,403		—			—			3,403
Long-Term Debt	2,290,685		—		65,039			—			2,355,724
Non-Recourse Debt	—		—		307,032			—			307,032
Commitments & Contingencies and Other
Shareholders' Equity:
The GEO Group, Inc. Shareholders' Equity	1,007,794		1,923,404		118,145			(2,041,549		)	1,007,794
Noncontrolling Interests	—		—		(790		)	—			(790		)
Total Shareholders’ Equity	1,007,794		1,923,404		117,355			(2,041,549		)	1,007,004
Total Liabilities and Shareholders' Equity	$	3,498,860	$	3,535,300	$	589,823		$	(3,341,104	)	$	4,282,879

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 Nine Months Ended September 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	$	212,177		$	55,258		$	55,523		$	322,958
Cash Flow from Investing Activities:
Insurance proceeds - damaged property	—			17,389			—			17,389
Proceeds from sale of property and equipment	—			402			—			402
Proceeds from sale of assets held for sale	—			823			—			823
Change in restricted investments	—			(5,449		)	—			(5,449		)
Capital expenditures	(22,941		)	(66,723		)	(1,123		)	(90,787		)
Net cash used in investing activities	(22,941		)	(53,558		)	(1,123		)	(77,622		)
Cash Flow from Financing Activities:
Proceeds from long-term debt	274,370			—			—			274,370
Payments on long-term debt	(310,616		)	—			—			(310,616		)
Payments on non-recourse debt	—			—			(332,717		)	(332,717		)
Proceeds from non-recourse debt	—			—			322,906			322,906
Taxes paid related to net share settlements of equity awards	(4,177		)	—			—			(4,177		)
Proceeds from issuance of common stock in connection with ESPP	400			—			—			400
Debt issuance costs	(4,656		)	—			(5,229		)	(9,885		)
Proceeds from stock options exercised	1,259			—			—			1,259
Dividends paid	(174,332		)	—			—			(174,332		)
Net cash used in financing activities	(217,752		)	—			(15,040		)	(232,792		)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	—			—			(2,063		)	(2,063		)
Net (Decrease) Increase in Cash. Cash Equivalents and Restricted Cash and Cash Equivalents	(28,516		)	1,700			37,297			10,481
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	$	26,150		$	6,523		$	62,280		$	94,953

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(dollars in thousands)

(unaudited)

	For the Nine Months Ended September 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	$	112,599		$	70,040		$	37,584		$	220,223
Cash Flow from Investing Activities:
Proceeds from sale of property and equipment	—			—			2,061			2,061
Proceeds from sale of assets held for sale	—			3,797						3,797
Insurance proceeds - damaged property	—			5,998			—			5,998
Change in restricted investments	—			(2,413		)	—			(2,413		)
Capital expenditures	(95,461		)	(64,015		)	(2,014		)	(161,490		)
Net cash (used in) provided by investing activities	(95,461		)	(56,633		)	47			(152,047		)
Cash Flow from Financing Activities:
Proceeds from long-term debt	372,000			—			—			372,000
Payments on long-term debt	(183,000		)	—			(3,033		)	(186,033		)
Payments on non-recourse debt	—			—			(9,636		)	(9,636		)
Taxes paid related to net share settlements of equity awards	(4,452		)	—			—			(4,452		)
Proceeds from issuance of common stock in connection with ESPP	404			—			—			404
Debt issuance costs	(990		)	—			—			(990		)
Proceeds from stock options exercised	1,781			—			—			1,781
Payments for repurchases of common stock	(70,446		)	—			—			(70,446		)
Dividends paid	(172,256		)	—			—			(172,256		)
Net cash used in financing activities	(56,959		)	—			(12,669		)	(69,628		)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	—			—			(5,392		)	(5,392		)
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash and Cash Equivalents	(39,821		)	13,407			19,570			(6,844		)
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	$	14,845		$	18,359		$	93,497		$	126,701