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Condensed Consolidating Financial Information | 3 Months Ended
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Mar. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Condensed Consolidating Financial Information | CONDENSED CONSOLIDATING FINANCIAL INFORMATION As of March 31, 2015, the Company's 6.625% Senior Notes, 5.125% Senior Notes, 5 7/8% Senior Notes and 5.875% Senior Notes were fully and unconditionally guaranteed on a joint and several senior unsecured basis by the Company and certain of its wholly-owned domestic subsidiaries (the “Subsidiary Guarantors”). The following condensed consolidating financial information, which has been prepared in accordance with the requirements for presentation of Rule 3-10(d) of Regulation S-X promulgated under the Securities Act, presents the condensed consolidating financial information separately for:
(i) | The GEO Group, Inc., as the issuer of the notes;
(ii) | The Subsidiary Guarantors, on a combined basis, which are 100% owned by The GEO Group, Inc., and which are guarantors of the notes;
(iii) | The Company’s other subsidiaries, on a combined basis, which are not guarantors of the notes (the “Non-Guarantor Subsidiaries”);
(iv) | Consolidating entries and eliminations representing adjustments to (a) eliminate intercompany transactions between or among the Company, the Subsidiary Guarantors and the Subsidiary Non-Guarantors and (b) eliminate the investments in the Company’s subsidiaries; and
(v) | The Company and its subsidiaries on a consolidated basis.
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (dollars in thousands) (unaudited)
| For the Three Months Ended March 31, 2015
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Eliminations |  | Consolidated
Revenues | $ | 144,383 |  |  | $ | 339,887 |  |  | $ | 64,967 |  |  | $ | (121,868 | ) |  | $ | 427,369 |
Operating expenses | 116,225 |  |  | 268,781 |  |  | 54,771 |  |  | (121,868 | ) |  | 317,909 |
Depreciation and amortization | 6,203 |  |  | 17,697 |  |  | 1,040 |  |  | — |  |  | 24,940 |
General and administrative expenses | 10,323 |  |  | 16,880 |  |  | 4,645 |  |  | — |  |  | 31,848 |
Operating income | 11,632 |  |  | 36,529 |  |  | 4,511 |  |  | — |  |  | 52,672 |
Interest income | 6,178 |  |  | 1,231 |  |  | 2,137 |  |  | (7,473 | ) |  | 2,073 |
Interest expense | (14,310 | ) |  | (14,636 | ) |  | (3,173 | ) |  | 7,473 |  |  | (24,646 | )
Income before income taxes and equity in earnings of affiliates | 3,500 |  |  | 23,124 |  |  | 3,475 |  |  | — |  |  | 30,099 |
Income tax provision | — |  |  | 1,740 |  |  | 1,088 |  |  | — |  |  | 2,828 |
Equity in earnings of affiliates, net of income tax provision | — |  |  | — |  |  | 1,485 |  |  | — |  |  | 1,485 |
Income before equity in income of consolidated subsidiaries | 3,500 |  |  | 21,384 |  |  | 3,872 |  |  | — |  |  | 28,756 |
Income from consolidated subsidiaries, net of income tax provision | 25,256 |  |  | — |  |  | — |  |  | (25,256 | ) |  | — |
Net income | 28,756 |  |  | 21,384 |  |  | 3,872 |  |  | (25,256 | ) |  | 28,756 |
Net loss attributable to noncontrolling interests | — |  |  | — |  |  | 21 |  |  |  |  |  | 21 |
Net income attributable to The GEO Group, Inc. | $ | 28,756 |  |  | $ | 21,384 |  |  | $ | 3,893 |  |  | $ | (25,256 | ) |  | $ | 28,777 |
Net income | $ | 28,756 |  |  | $ | 21,384 |  |  | $ | 3,872 |  |  | $ | (25,256 | ) |  | $ | 28,756 |
Other comprehensive income (loss), net of tax | — |  |  | 40 |  |  | (5,761 | ) |  | — |  |  | (5,721 | )
Total comprehensive income (loss) | $ | 28,756 |  |  | $ | 21,424 |  |  | $ | (1,889 | ) |  | $ | (25,256 | ) |  | $ | 23,035 |
Comprehensive loss attributable to noncontrolling interests | — |  |  | — |  |  | 37 |  |  | — |  |  | 37 |
Comprehensive income (loss) attributable to The GEO Group, Inc. | $ | 28,756 |  |  | $ | 21,424 |  |  | $ | (1,852 | ) |  | $ | (25,256 | ) |  | $ | 23,072 |
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (dollars in thousands) (unaudited)
| For the Three Months Ended March 31, 2014
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Eliminations |  | Consolidated
Revenues | $ | 134,754 |  |  | $ | 314,985 |  |  | $ | 52,331 |  |  | $ | (108,933 | ) |  | $ | 393,137 |
Operating expenses | 107,222 |  |  | 250,680 |  |  | 42,954 |  |  | (108,933 | ) |  | 291,923 |
Depreciation and amortization | 6,406 |  |  | 16,634 |  |  | 1,102 |  |  | — |  |  | 24,142 |
General and administrative expenses | 9,339 |  |  | 15,536 |  |  | 3,627 |  |  | — |  |  | 28,502 |
Operating income | 11,787 |  |  | 32,135 |  |  | 4,648 |  |  | — |  |  | 48,570 |
Interest income | 5,536 |  |  | 436 |  |  | 679 |  |  | (5,919 | ) |  | 732 |
Interest expense | (11,074 | ) |  | (13,763 | ) |  | (1,734 | ) |  | 5,919 |  |  | (20,652 | )
Income before income taxes and equity in earnings of affiliates | 6,249 |  |  | 18,808 |  |  | 3,593 |  |  | — |  |  | 28,650 |
Income tax provision | — |  |  | 1,294 |  |  | 844 |  |  | — |  |  | 2,138 |
Equity in earnings of affiliates, net of income tax provision | — |  |  | — |  |  | 1,484 |  |  | — |  |  | 1,484 |
Income before equity in income of consolidated subsidiaries | 6,249 |  |  | 17,514 |  |  | 4,233 |  |  | — |  |  | 27,996 |
Income from consolidated subsidiaries, net of income tax provision | 21,747 |  |  | — |  |  | — |  |  | (21,747 | ) |  | — |
Net income | 27,996 |  |  | 17,514 |  |  | 4,233 |  |  | (21,747 | ) |  | 27,996 |
Net income attributable to noncontrolling interests | — |  |  | — |  |  | (6 | ) |  | — |  |  | (6 | )
Net income attributable to The GEO Group, Inc. | $ | 27,996 |  |  | $ | 17,514 |  |  | $ | 4,227 |  |  | $ | (21,747 | ) |  | $ | 27,990 |
Net income | $ | 27,996 |  |  | $ | 17,514 |  |  | $ | 4,233 |  |  | $ | (21,747 | ) |  | $ | 27,996 |
Other comprehensive income, net of tax | — |  |  | 19 |  |  | 1,027 |  |  | — |  |  | 1,046 |
Total comprehensive income | $ | 27,996 |  |  | $ | 17,533 |  |  | $ | 5,260 |  |  | $ | (21,747 | ) |  | $ | 29,042 |
Comprehensive loss attributable to noncontrolling interests | — |  |  | — |  |  | (2 | ) |  | — |  |  | (2 | )
Comprehensive income attributable to The GEO Group, Inc. | $ | 27,996 |  |  | $ | 17,533 |  |  | $ | 5,258 |  |  | $ | (21,747 | ) |  | $ | 29,040 |
CONDENSED CONSOLIDATING BALANCE SHEET (dollars in thousands) (unaudited)
| As of March 31, 2015
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Eliminations |  | Consolidated
ASSETS
Cash and cash equivalents | $ | 12,962 |  |  | $ | 12,433 |  |  | $ | 43,586 |  |  | $ | — |  |  | $ | 68,981 |
Restricted cash and investments | — |  |  | — |  |  | 8,489 |  |  | — |  |  | 8,489 |
Accounts receivable, less allowance for doubtful accounts | 97,109 |  |  | 150,561 |  |  | 13,610 |  |  | — |  |  | 261,280 |
Current deferred income tax assets | — |  |  | 21,657 |  |  | 4,227 |  |  | — |  |  | 25,884 |
Prepaid expenses and other current assets | 5,545 |  |  | 21,853 |  |  | 18,176 |  |  | (1,154 | ) |  | 44,420 |
Total current assets | 115,616 |  |  | 206,504 |  |  | 88,088 |  |  | (1,154 | ) |  | 409,054 |
Restricted Cash and Investments | 126 |  |  | 15,175 |  |  | 7,916 |  |  | — |  |  | 23,217 |
Property and Equipment, Net | 738,622 |  |  | 1,085,096 |  |  | 83,345 |  |  | — |  |  | 1,907,063 |
Contract Receivable | — |  |  | — |  |  | 87,042 |  |  | — |  |  | 87,042 |
Direct Finance Lease Receivable | — |  |  | — |  |  | 7,077 |  |  | — |  |  | 7,077 |
Intercompany Receivable | 963,417 |  |  | 138,933 |  |  | — |  |  | (1,102,350 | ) |  | — |
Non-Current Deferred Income Tax Assets | — |  |  | — |  |  | 5,873 |  |  | — |  |  | 5,873 |
Goodwill | 34 |  |  | 600,731 |  |  | 440 |  |  | — |  |  | 601,205 |
Intangible Assets, Net | — |  |  | 223,194 |  |  | 977 |  |  | — |  |  | 224,171 |
Investment in Subsidiaries | 1,146,712 |  |  | 238,847 |  |  | — |  |  | (1,385,559 | ) |  | — |
Other Non-Current Assets | 24,635 |  |  | 111,702 |  |  | 46,957 |  |  | (80,075 | ) |  | 103,219 |
Total Assets | $ | 2,989,162 |  |  | $ | 2,620,182 |  |  | $ | 327,715 |  |  | $ | (2,569,138 | ) |  | $ | 3,367,921 |
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable | $ | 8,471 |  |  | $ | 49,757 |  |  | $ | 2,307 |  |  | $ | — |  |  | $ | 60,535 |
Accrued payroll and related taxes | — |  |  | 42,159 |  |  | 13,692 |  |  | — |  |  | 55,851 |
Accrued expenses and other | 41,609 |  |  | 67,228 |  |  | 28,138 |  |  | (1,154 | ) |  | 135,821 |
Current portion of capital lease obligations, long-term debt and non-recourse debt | 3,001 |  |  | 1,241 |  |  | 12,406 |  |  | — |  |  | 16,648 |
Total current liabilities | 53,081 |  |  | 160,385 |  |  | 56,543 |  |  | (1,154 | ) |  | 268,855 |
Non-Current Deferred Income Tax Liabilities | (4,351 | ) |  | 14,414 |  |  | 5 |  |  | — |  |  | 10,068 |
Intercompany Payable | 114,710 |  |  | 971,134 |  |  | 16,506 |  |  | (1,102,350 | ) |  | — |
Other Non-Current Liabilities | 4,301 |  |  | 142,741 |  |  | 32,699 |  |  | (80,075 | ) |  | 99,666 |
Capital Lease Obligations | — |  |  | 9,574 |  |  | — |  |  | — |  |  | 9,574 |
Long-Term Debt | 1,795,267 |  |  | — |  |  | — |  |  | — |  |  | 1,795,267 |
Non-Recourse Debt | — |  |  | — |  |  | 158,060 |  |  | — |  |  | 158,060 |
Commitments & Contingencies and Other |  |  |  |  |  |  |  |  |  |  |  |  |  |
Shareholders' Equity: |  |  |  |  |  |  |  |  |
The GEO Group, Inc. Shareholders' Equity | 1,026,154 |  |  | 1,321,934 |  |  | 63,625 |  |  | (1,385,559 | ) |  | 1,026,154 |
Noncontrolling Interests | — |  |  | — |  |  | 277 |  |  | — |  |  | 277 |
Total Shareholders’ Equity | 1,026,154 |  |  | 1,321,934 |  |  | 63,902 |  |  | (1,385,559 | ) |  | 1,026,431 |
Total Liabilities and Shareholders' Equity | $ | 2,989,162 |  |  | $ | 2,620,182 |  |  | $ | 327,715 |  |  | $ | (2,569,138 | ) |  | $ | 3,367,921 |
CONDENSED CONSOLIDATING BALANCE SHEET (dollars in thousands)
| As of December 31, 2014
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Eliminations |  | Consolidated
ASSETS
Cash and cash equivalents | $ | 18,492 |  |  | $ | 782 |  |  | $ | 22,063 |  |  | $ | — |  |  | $ | 41,337 |
Restricted cash and investments | — |  |  | — |  |  | 4,341 |  |  | — |  |  | 4,341 |
Accounts receivable, less allowance for doubtful accounts | 92,456 |  |  | 159,505 |  |  | 17,077 |  |  | — |  |  | 269,038 |
Current deferred income tax assets | — |  |  | 21,657 |  |  | 4,227 |  |  | — |  |  | 25,884 |
Prepaid expenses and other current assets | 7,022 |  |  | 19,593 |  |  | 11,345 |  |  | (1,154 | ) |  | 36,806 |
Total current assets | 117,970 |  |  | 201,537 |  |  | 59,053 |  |  | (1,154 | ) |  | 377,406 |
Restricted Cash and Investments | 228 |  |  | 13,729 |  |  | 5,621 |  |  | — |  |  | 19,578 |
Property and Equipment, Net | 726,238 |  |  | 961,896 |  |  | 84,032 |  |  | — |  |  | 1,772,166 |
Direct Finance Lease Receivable | — |  |  | — |  |  | 9,256 |  |  | — |  |  | 9,256 |
Contract Receivable | — |  |  | — |  |  | 66,229 |  |  |  |  | 66,229 |
Intercompany Receivable | 962,314 |  |  | 119,414 |  |  | — |  |  | (1,081,728 | ) |  | — |
Non-Current Deferred Income Tax Assets | — |  |  | — |  |  | 5,873 |  |  | — |  |  | 5,873 |
Goodwill | 34 |  |  | 493,389 |  |  | 467 |  |  | — |  |  | 493,890 |
Intangible Assets, Net | — |  |  | 154,237 |  |  | 1,038 |  |  | — |  |  | 155,275 |
Investment in Subsidiaries | 855,870 |  |  | 438,243 |  |  | — |  |  | (1,294,113 | ) |  | — |
Other Non-Current Assets | 25,635 |  |  | 110,105 |  |  | 46,838 |  |  | (80,043 | ) |  | 102,535 |
Total Assets | $ | 2,688,289 |  |  | $ | 2,492,550 |  |  | $ | 278,407 |  |  | $ | (2,457,038 | ) |  | $ | 3,002,208 |
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable | $ | 7,549 |  |  | $ | 47,130 |  |  | $ | 3,476 |  |  | $ | — |  |  | $ | 58,155 |
Accrued payroll and related taxes | — |  |  | 24,184 |  |  | 14,372 |  |  | — |  |  | 38,556 |
Accrued expenses and other | 47,637 |  |  | 75,574 |  |  | 18,555 |  |  | (1,154 | ) |  | 140,612 |
Current portion of capital lease obligations, long-term debt and non-recourse debt | 3,001 |  |  | 1,170 |  |  | 12,581 |  |  | — |  |  | 16,752 |
Total current liabilities | 58,187 |  |  | 148,058 |  |  | 48,984 |  |  | (1,154 | ) |  | 254,075 |
Non-Current Deferred Income Tax Liabilities | (4,095 | ) |  | 14,170 |  |  | (7 | ) |  | — |  |  | 10,068 |
Intercompany Payable | 121,327 |  |  | 942,071 |  |  | 18,330 |  |  | (1,081,728 | ) |  | — |
Other Non-Current Liabilities | 4,372 |  |  | 143,584 |  |  | 19,507 |  |  | (80,034 | ) |  | 87,429 |
Capital Lease Obligations | — |  |  | 9,856 |  |  | — |  |  | — |  |  | 9,856 |
Long-Term Debt | 1,462,819 |  |  | — |  |  | — |  |  | — |  |  | 1,462,819 |
Non-Recourse Debt | — |  |  | — |  |  | 131,968 |  |  | — |  |  | 131,968 |
Commitments & Contingencies and Other |  |  |  |  |  |  |  |  |
Shareholders' Equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |
The GEO Group, Inc. Shareholders' Equity | 1,045,679 |  |  | 1,234,811 |  |  | 59,311 |  |  | (1,294,122 | ) |  | 1,045,679 |
Noncontrolling Interests | — |  |  | — |  |  | 314 |  |  | — |  |  | 314 |
Total Shareholders’ Equity | 1,045,679 |  |  | 1,234,811 |  |  | 59,625 |  |  | (1,294,122 | ) |  | 1,045,993 |
Total Liabilities and Shareholders' Equity | $ | 2,688,289 |  |  | $ | 2,492,550 |  |  | $ | 278,407 |  |  | $ | (2,457,038 | ) |  | $ | 3,002,208 |
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (dollars in thousands) (unaudited)
| For the Three Months Ended March 31, 2015
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Consolidated
Cash Flow from Operating Activities: |  |  |  |  |  |  |
Net cash provided by operating activities | $ | 35,300 |  |  | $ | 30,416 |  |  | $ | (4,971 | ) |  | $ | 60,745 |
Cash Flow from Investing Activities: |  |  |  |  |  |  |
Acquisition of LCS, net of cash acquired | (307,403 | ) |  | — |  |  | — |  |  | (307,403 | )
Proceeds from sale of property and equipment | — |  |  | 20 |  |  | — |  |  | 20 |
Insurance proceeds - damaged property | — |  |  | 700 |  |  | — |  |  | 700 |
Change in restricted cash and investments | 102 |  |  | (6,443 | ) |  | (1,767 | ) |  | (8,108 | )
Capital expenditures | (20,561 | ) |  | (13,042 | ) |  | (595 | ) |  | (34,198 | )
Net cash used in investing activities | (327,862 | ) |  | (18,765 | ) |  | (2,362 | ) |  | (348,989 | )
Cash Flow from Financing Activities: |  |  |  |  |  |  |
Proceeds from long-term debt | 371,000 |  |  | — |  |  | — |  |  | 371,000 |
Payments on long-term debt | (38,750 | ) |  | — |  |  | — |  |  | (38,750 | )
Payments on non-recourse debt | — |  |  | — |  |  | (1,645 | ) |  | (1,645 | )
Proceeds from non-recourse debt | — |  |  | — |  |  | 33,019 |  |  | 33,019 |
Taxes paid related to net share settlements of equity awards | (1,123 | ) |  | — |  |  | — |  |  | (1,123 | )
Proceeds from reissuance of treasury stock in connection with ESPP | 98 |  |  | — |  |  | — |  |  | 98 |
Debt issuance costs | — |  |  | — |  |  | (1,245 | ) |  | (1,245 | )
Tax benefit related to equity compensation | 569 |  |  | — |  |  | — |  |  | 569 |
Proceeds from stock options exercised | 1,215 |  |  | — |  |  | — |  |  | 1,215 |
Cash dividends paid | (45,977 | ) |  | — |  |  | — |  |  | (45,977 | )
Net cash provided by financing activities | 287,032 |  |  | — |  |  | 30,129 |  |  | 317,161 |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | — |  |  | — |  |  | (1,273 | ) |  | (1,273 | )
Net Increase (Decrease) in Cash and Cash Equivalents | (5,530 | ) |  | 11,651 |  |  | 21,523 |  |  | 27,644 |
Cash and Cash Equivalents, beginning of period | 18,492 |  |  | 782 |  |  | 22,063 |  |  | 41,337 |
Cash and Cash Equivalents, end of period | $ | 12,962 |  |  | $ | 12,433 |  |  | $ | 43,586 |  |  | $ | 68,981 |
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (dollars in thousands) (unaudited)
| For the Three Months Ended March 31, 2014
| The GEO Group, Inc. |  | Combined Subsidiary Guarantors |  | Combined Non-Guarantor Subsidiaries |  | Consolidated
Cash Flow from Operating Activities: |  |  |  |  |  |  |
Net cash provided by operating activities | $ | 28,511 |  |  | $ | 25,116 |  |  | $ | 9,525 |  |  | $ | 63,152 |
Cash Flow from Investing Activities: |  |  |  |  |  |  |
Proceeds from sale of property and equipment | — |  |  | 165 |  |  | — |  |  | 165 |
Acquisition of Protocol, cash consideration | — |  |  | (13,000 | ) |  | — |  |  | (13,000 | )
Change in restricted cash and investments | (185 | ) |  | (549 | ) |  | (2,539 | ) |  | (3,273 | )
Capital expenditures | (8,586 | ) |  | (8,642 | ) |  | (303 | ) |  | (17,531 | )
Net cash used in investing activities | (8,771 | ) |  | (22,026 | ) |  | (2,842 | ) |  | (33,639 | )
Cash Flow from Financing Activities: |  |  |  |  |  |  |
Proceeds from long-term debt | 103,000 |  |  | — |  |  | — |  |  | 103,000 |
Payments on long-term debt | (108,750 | ) |  | (240 | ) |  | — |  |  | (108,990 | )
Payments on non-recourse debt | — |  |  | — |  |  | (1,403 | ) |  | (1,403 | )
Proceeds from reissuance of treasury stock in connection with ESPP | 84 |  |  | — |  |  | — |  |  | 84 |
Tax benefit related to equity compensation | 558 |  |  | — |  |  | — |  |  | 558 |
Proceeds from stock options exercised | 3,275 |  |  | — |  |  | — |  |  | 3,275 |
Cash dividends paid | (41,139 | ) |  | — |  |  | — |  |  | (41,139 | )
Net cash used in financing activities | (42,972 | ) |  | (240 | ) |  | (1,403 | ) |  | (44,615 | )
Effect of Exchange Rate Changes on Cash and Cash Equivalents | — |  |  | — |  |  | 1,040 |  |  | 1,040 |
Net Increase (Decrease) in Cash and Cash Equivalents | (23,232 | ) |  | 2,850 |  |  | 6,320 |  |  | (14,062 | )
Cash and Cash Equivalents, beginning of period | 30,730 |  |  | 985 |  |  | 20,410 |  |  | 52,125 |
Cash and Cash Equivalents, end of period | $ | 7,498 |  |  | $ | 3,835 |  |  | $ | 26,730 |  |  | $ | 38,063 |

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- Definition The entire disclosure for condensed financial statements. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=18733093&loc=d3e5614-111684 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 10 -Paragraph f -Article 3 + Details
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