Item 2.02 Results of Operations and Financial Condition.
On November 2, 2009, The GEO Group, Inc. ("GEO") issued a press release (the
"Press Release") announcing its financial results for the fiscal quarter ended
September 27, 2009, a copy of which is incorporated herein by reference and
attached hereto as Exhibit 99.1. GEO also held a conference call on November 2,
2009 to discuss its financial results for the quarter, a transcript of which is
incorporated herein by reference and attached hereto as Exhibit 99.2.
In the Press Release, GEO provided certain pro forma financial information for
the fiscal quarter ended September 27, 2009 that was not calculated in
accordance with Generally Accepted Accounting Principles (the "Non-GAAP
Information"). Generally, for purposes of Regulation G under the Securities
Exchange Act of 1934, Non-GAAP Information is any numerical measure of a
company's performance, financial position, or cash flows that either excludes or
includes amounts that are not normally excluded or included in the most directly
comparable measure calculated and presented in accordance with GAAP. The Press
Release presents the financial measure calculated and presented in accordance
with GAAP which is most directly comparable to the Non-GAAP Information with a
prominence equal to or greater than its presentation of the Non-GAAP
Information. The Press Release also contains a reconciliation of the Non-GAAP
Information to the financial measure calculated and presented in accordance with
GAAP which is most directly comparable to the Non-GAAP Information.
The Press Release includes three non-GAAP measures, Pro Forma Income from
Continuing Operations, Adjusted EBITDA and Adjusted Free Cash Flow, that are
presented as supplemental disclosures. Pro Forma Income from Continuing
Operations is defined as income from continuing operations excluding start-up/
transition expenses, net of taxes and international bid and proposal expenses,
net of taxes. Adjusted EBITDA is defined as net income before net interest
expense, income tax and depreciation and amortization, excluding discontinued
operations, start-up/ transition expenses and international bid and proposal
expenses. In calculating these adjusted financial measures, GEO excludes certain
expenses which it believes are unusual or non-recurring in nature in order to
facilitate an understanding of GEO's operating performance. GEO's management
uses these adjusted financial measures in conjunction with GAAP financial
measures to monitor and evaluate its operating performance and to facilitate
internal and external comparisons of the historical operating performance of GEO
and its business units. Adjusted Free Cash Flow is defined as income from
continuing operations excluding depreciation and amortization, income taxes,
start-up/ transition expenses, international bid and proposal expenses and the
other items referenced in Table 4 of the Press Release. GEO's management
believes that the Adjusted Free Cash Flow measure provides useful information to
GEO's management and investors regarding cash that GEO's operating business
generates before taking into account certain cash and non-cash items that are
non-operational or infrequent in nature.
GEO's management believes that these adjusted financial measures are useful to
investors to provide them with disclosures of GEO's operating results on the
same basis as that used by GEO's management. Additionally, GEO's management
believes that these adjusted financial measures provide useful information to
investors about the performance of GEO's overall business because such financial
measures eliminate the effects of unusual or non-recurring charges that are not
directly attributable to GEO's underlying operating performance. GEO's
management believes that because it has historically provided similar non-GAAP
Financial Information in its earnings releases, continuing to do so provides
consistency in its financial reporting and continuity to investors for
comparability purposes.
The Non-GAAP Financial Information should be considered in addition to results
that are prepared under current accounting standards but should not be
considered a substitute for, or superior to, financial information prepared in
accordance with GAAP. The Non-GAAP Financial Information may differ from
similarly titled measures presented by other companies. The Non-GAAP Financial
Information, as well as other information in the Press Release, should be read
in conjunction with GEO's financial statements filed with the Securities and
Exchange Commission. The information in this Form 8-K is being furnished and
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liabilities of
that Section. The information in this Form 8-K shall not be incorporated by
reference into any registration statement or other document pursuant to the
Securities Act of 1933, as amended.
Safe-Harbor Statement
This Form 8-K contains forward-looking statements regarding future events and
future performance of GEO that involve risks and uncertainties that could
materially affect actual results, including statements regarding estimated
earnings, revenues and costs and our ability to maintain growth and strengthen
contract relationships. Factors that
could cause actual results to vary from current expectations and forward-looking
statements contained in this press release include, but are not limited to those
factors contained in GEO's Securities and Exchange Commission filings, including
the forms 10-K, 10-Q and 8-K reports.
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
c) Exhibits
99.1 Press Release, dated November 2, 2009, announcing GEO's financial results
for the fiscal quarter ended September 27, 2009
99.2 Transcript of Conference Call discussing GEO's financial results for the
fiscal quarter ended September 27, 2009
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