Business Segments and Geographic Information

3 Months Ended

Mar. 31, 2020

Business Segments and Geographic Information

12. BUSINESS SEGMENTS AND GEOGRAPHIC INFORMATION

Operating and Reporting Segments

The Company conducts its business through four reportable business segments: the GEO Secure Services segment; the GEO Care segment; the International Services segment; and the Facility Construction & Design segment. The Company's segment revenues from external customers and a measure of segment profit are as follows (in thousands):

	Three Months Ended
	March 31, 2020			March 31, 2019
Revenues:
GEO Secure Services	$	398,109		$	390,510
GEO Care		144,463			153,843
International Services		56,850			64,224
Facility Construction & Design [1]		5,595			2,090
Total revenues	$	605,017		$	610,667
Operating income from segments:
GEO Secure Services	$	74,009		$	76,924
GEO Care		30,699			38,538
International Services		5,650			5,739
Facility Construction & Design [1]		10			—
Operating income from segments	$	110,368		$	121,201
General and Administrative Expenses		(53,782	)		(46,424	)
Total Operating Income	$	56,586		$	74,777

[1]	Facility Construction & Design revenues relate to an expansion project at the Company's managed-only Fulham Correctional Centre in Australia which is expected to be completed in the third quarter of 2020.

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 and equity in earnings of affiliates (in thousands):

	Three Months Ended
	March 31, 2020			March 31, 2019
Operating income from segments	$	110,368		$	121,201
Unallocated amounts:
General and administrative expenses		(53,782	)		(46,424	)
Net interest expense		(28,742	)		(31,884	)
Gain on extinguishment of debt		1,563			—
Income before income taxes and equity in earnings of affiliates	$	29,407		$	42,893

Equity in Earnings of Affiliates

Equity in earnings of affiliates includes the Company’s 50% owned joint ventures in SACS, located in South Africa, and GEOAmey, located in the United Kingdom. The Company's investments in these entities are accounted for under the equity method of accounting. The Company’s investments in these entities are presented as a component of Other Non-Current Assets in the accompanying consolidated balance sheets.

The Company has recorded $1.0 million in earnings, net of tax, for SACS operations during the three months ended March 31, 2020, and $1.4 million in earnings, net of tax, for SACS operations during the three months ended March 31, 2019, which are included in equity in earnings of affiliates, net of income tax provision in the accompanying consolidated statements of operations. As of March 31, 2020 and December 31, 2019, the Company’s investment in SACS was $8.9 million and $12.3 million, respectively, and represents its share of cumulative reported earnings.

The Company has recorded $1.2 million in earnings, net of tax, for GEO Amey's operations during the three months ended March 31, 2020, and $1.2 million in earnings, net of tax, for GEO Amey's operations during the three months ended March 31, 2019, which are included in equity in earnings of affiliates, net of income tax provision in the accompanying consolidated statements of operations. As of March 31, 2020 and December 31, 2019, the Company’s investment in GEOAmey was $6.5 million and $5.7 million, respectively, and represents its share of cumulative reported earnings.