The GEO Group, Inc. (GEO) 8-K The Geo Group Reports Third Quarter 2009 Results

Exhibit 99.1

NEWS RELEASE

One Park Place, Suite 700n 621 Northwest 53^rd Streetn Boca Raton, Florida 33487n www.geogroup.com

CR-09-33

THE GEO GROUP REPORTS THIRD QUARTER 2009 RESULTS

• 3Q GAAP Earnings Increased 24% to $19.3 Million — $0.37 EPS

• 3Q Pro-Forma Earnings Increased 15% to $19.9 Million — $0.38 EPS

• Confirms 4Q Pro Forma EPS Guidance — $0.38 to $0.39 and Increases full-year pro forma EPS Guidance — $1.40 to $1.41

Boca Raton, Fla. – November 2, 2009 — The GEO Group (NYSE: GEO)(“GEO”) today reported third quarter 2009 financial results. GEO reported third quarter 2009 GAAP income from continuing operations of $19.3 million, or $0.37 per diluted share, compared to $15.5 million, or $0.30 per diluted share, in the third quarter of 2008. Third quarter 2009 pro forma income from continuing operations increased to $19.9 million, or $0.38 per diluted share, from pro forma income from continuing operations of $17.3 million, or $0.33 per diluted share, in the third quarter of 2008.

For the first nine months of 2009, GEO reported GAAP income from continuing operations of $50.8 million, or $0.98 per diluted share, compared to $41.2 million, or $0.80 per diluted share, for the first nine months of 2008. Pro forma income from continuing operations for the first nine months of 2009 increased to $52.8 million, or $1.02 per diluted share, from pro forma income from continuing operations of $45.7 million, or $0.88 per diluted share, for the first nine months of 2008.

George C. Zoley, Chairman and Chief Executive Officer of GEO, said: “Our strong third quarter earnings results and confirmed outlook for the fourth quarter continue to be driven by sound operational and financial results through our diversified business units. Our already strong balance sheet has been further strengthened by our recent refinancing transactions, and we are now well positioned to take advantage of the robust demand for correctional, detention, and residential treatment beds in our core market segments.”

Pro forma income from continuing operations excludes start-up/transition expenses, international bid and proposal costs, and other items as set forth in the table below, which presents a reconciliation of pro forma income from continuing operations to GAAP income from continuing operations for the third quarter and first nine months of 2009. Please see the section of this press release below entitled “Important Information on GEO’s Non-GAAP Financial Measures” for information on how GEO defines pro forma income from continuing operations.

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Contact: Pablo E. Paez
Director, Corporate Relations (866) 301 4436

NEWS RELEASE

Table 1. Reconciliation of Pro Forma Income from Continuing Operations to GAAP Income from Continuing Operations

	13 Weeks Ended		13 Weeks Ended		39 Weeks Ended		39 Weeks Ended
(In thousands except per share data)	27-Sep-09		28-Sep-08		27-Sep-09		28-Sep-08
Income from continuing operations	$	19,258	$	15,497	$	50,820	$	41,237
Start-up/transition expenses, net of tax		634		1,769		1,708		4,224
International bid and proposal expenses, net of tax		—		51		306		246
Pro forma income from continuing operations	$	19,892	$	17,317	$	52,834	$	45,707
Diluted earnings per share
Income from Continuing Operations	$	0.37	$	0.30	$	0.98	$	0.80
Start-up/transition expenses, net of tax		0.01		0.03		0.03		0.08
International bid and proposal expenses, net of tax		—		—		0.01		—
Diluted pro forma earnings per share	$	0.38	$	0.33	$	1.02	$	0.88
Weighted average common shares outstanding-diluted		51,950		51,803		51,847		51,820

Business Segment Results

The following table presents a summary of GEO’s segment financial results for the third quarter and first nine months of 2009.

Table 2. Business Segment Results

	13 Weeks Ended		13 Weeks Ended		39 Weeks Ended		39 Weeks Ended
	27-Sep-09		28-Sep-08		27-Sep-09		28-Sep-08
Revenues
U.S. Corrections	$	192,606	$	177,930	$	576,640	$	520,029
International Services		36,668		33,896		92,217		102,927
GEO Care		27,722		28,794		84,185		89,063
Construction		37,869		13,485		77,263		74,534
	$	294,865	$	254,105	$	830,305	$	786,553
Operating Expenses
U.S. Corrections	$	137,397	$	129,645	$	418,861	$	381,863
International Services		34,477		31,058		85,539		93,809
GEO Care		24,635		25,180		74,104		78,380
Construction		37,899		13,369		77,088		74,222
	$	234,408	$	199,252	$	655,592	$	628,274
Depreciation & Amortization Expense
U.S. Corrections	$	8,899	$	8,542	$	26,955	$	24,918
International Services		376		415		1,039		1,201
GEO Care		341		372		1,068		1,404
Construction		—		—		—		—
	$	9,616	$	9,329	$	29,062	$	27,523

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Contact: Pablo E. Paez
Director, Corporate Relations (866) 301 4436

NEWS RELEASE

Table 2. Business Segment Results (Continued)

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended			39 Weeks Ended
	27-Sep-09			28-Sep-08			27-Sep-09			28-Sep-08
Compensated Mandays
U.S. Corrections		3,584,062			3,325,492			10,708,144			9,794,737
International Services		548,821			525,161			1,599,143			1,575,482
GEO Care		133,094			133,048			400,032			408,869
		4,265,977			3,983,701			12,707,319			11,779,088
Revenue Producing Beds
U.S. Corrections		42,088			39,599			42,088			39,599
International Services		6,031			5,771			6,031			5,771
GEO Care		1,516			1,528			1,516			1,528
		49,635			46,898			49,635			46,898
Average Occupancy
U.S. Corrections		93.6	%		96.0	%		94.0	%		95.9	%
International Services		100.0	%		100.0	%		100.0	%		100.0	%
GEO Care		96.5	%		100.0	%		96.7	%		100.0	%
		94.5	%		96.6	%		94.8	%		96.6	%

Adjusted EBITDA

Third quarter 2009 Adjusted EBITDA increased to $46.7 million from $41.3 million in the third quarter of 2008. For the first nine months of 2009, Adjusted EBITDA increased to $130.7 million from $114.8 million for the first nine months of 2008. Please see the section of this press release below entitled “Important Information on GEO’s Non-GAAP Financial Measures” for information on how GEO defines Adjusted EBITDA. The following table presents a reconciliation from Adjusted EBITDA to GAAP Net income for the third quarter and first nine months of 2009.

Table 3. Reconciliation from Adjusted EBITDA to GAAP Net Income

	13 Weeks Ended		13 Weeks Ended			39 Weeks Ended		39 Weeks Ended
(In thousands)	27-Sep-09		28-Sep-08			27-Sep-09		28-Sep-08
Net income	$	19,258	$	15,859		$	50,474	$	42,465
Interest expense, net		5,309		5,431			16,978		16,087
Income tax provision		11,493		8,430			30,324		23,616
Depreciation and amortization		9,616		9,329			29,062		27,523
EBITDA	$	45,676	$	39,049		$	126,838	$	109,691
Adjustments, pre-tax
Discontinued operations, (income) loss		—		(710	)		562		(2,103	)
Start-up/transition expenses		1,034		2,844			2,785		6,829
International bid and proposal expenses		—		82			499		394
Adjusted EBITDA	$	46,710	$	41,265		$	130,684	$	114,811

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Contact: Pablo E. Paez
Director, Corporate Relations (866) 301 4436

NEWS RELEASE

Adjusted Free Cash Flow

Adjusted Free Cash Flow for the third quarter of 2009 increased to $32.1 million from $25.3 million for the third quarter of 2008. For the first nine months of 2009, Adjusted Free Cash Flow increased to $87.3 million from $67.2 million for the first nine months of 2008. Please see the section of this press release below entitled “Important Information on GEO’s Non-GAAP Financial Measures” for information on how GEO defines Adjusted Free Cash Flow. The following table presents a reconciliation from Adjusted Free Cash Flow to GAAP income from continuing operations for the third quarter and first nine months of 2009.

Table 4. Reconciliation of Adjusted Free Cash Flow to GAAP Income from Continuing Operations

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended			39 Weeks Ended
(In thousands)	27-Sep-09			28-Sep-08			27-Sep-09			28-Sep-08
Income from Continuing Operations	$	19,258		$	15,497		$	50,820		$	41,237
Depreciation and Amortization		9,616			9,329			29,062			27,523
Income Tax Provision		11,493			8,430			30,324			23,616
Income Taxes Paid		(7,551	)		(7,850	)		(23,963	)		(26,056	)
Stock Based Compensation		976			1,103			3,357			2,906
Maintenance Capital Expenditures		(3,000	)		(4,051	)		(6,679	)		(9,272	)
Equity in Earnings of Affiliates, Net of Income Tax		(904	)		(778	)		(2,407	)		(2,009	)
Amortization of Debt Costs and Other Non-Cash Interest		1,167			720			3,471			2,055
Start-up/transition expenses		1,034			2,844			2,785			6,829
International bid and proposal expenses		—			82			499			394
Adjusted Free Cash Flow	$	32,089		$	25,326		$	87,269		$	67,223

Financial Guidance

GEO confirmed its financial guidance for the fourth quarter 2009. For the fourth quarter 2009, GEO expects total revenues to be in the range of $313 million to $318 million, including approximately $25 million in construction revenues, and earnings to be in a range of $0.38 to $0.39 per diluted share, excluding $0.08 per diluted share in a one-time, after-tax charge related to the early extinguishment of debt associated with the redemption of GEO’s $150 million, 8¹/4% senior unsecured notes due 2013 as well as $0.03 per diluted share in after-tax start-up/transition expenses.

For the full-year 2009, GEO expects total revenues to be in the range of $1.143 billion to $1.148 billion, including approximately $102 million in construction revenues, and GEO increased its earnings guidance to a pro forma range of $1.40 to $1.41 per diluted share, excluding $0.08 per diluted share in a one-time, after-tax charge related to the early extinguishment of debt associated with the redemption of GEO’s $150 million, 8¹/4% senior unsecured notes due 2013 as well as $0.07 per diluted share in after-tax start-up/transition expenses and international bid and proposal costs.

GEO’s guidance is based on a number of assumptions related to GEO’s business including the continued operation of GEO’s current contracts at projected occupancy levels and the activation of GEO’s announced projects under development as scheduled.

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Contact: Pablo E. Paez
Director, Corporate Relations (866) 301 4436

NEWS RELEASE

Conference Call Information

GEO has scheduled a conference call and simultaneous webcast at 11:00 AM (Eastern Time) today to discuss GEO’s third quarter 2009 financial results as well as its progress and outlook. The call-in number for the U.S. is 1-866-804-6925 and the international call-in number is 1-857-350-1671. The participant pass-code for the conference call is 50426075. In addition, a live audio webcast of the conference call may be accessed on the Conference Calls/Webcasts section of GEO’s investor relations home page atwww.geogroup.com. A replay of the audio webcast will be available on the website for one year. A telephonic replay of the conference call will be available until December 2, 2009 at 1-888-286-8010 (U.S.) and 1-617-801-6888 (International). The pass-code for the telephonic replay is 52882628. GEO will discuss Non-GAAP (“Pro Forma”) basis information on the conference call. A reconciliation from Non-GAAP (“Pro Forma”) basis information to GAAP basis results may be found on the Conference Calls/Webcasts section of GEO’s investor relations home page atwww.geogroup.com.

About The GEO Group, Inc.

The GEO Group, Inc. (“GEO”) is a world leader in the delivery of correctional, detention, and residential treatment services to federal, state, and local government agencies around the globe. GEO offers a turnkey approach that includes design, construction, financing, and operations. GEO represents government clients in the United States, Australia, South Africa, and the United Kingdom. GEO’s worldwide operations include the management and/or ownership of 62 correctional and residential treatment facilities with a total design capacity of approximately 60,000 beds, including projects under development.

Important Information on GEO’s Non-GAAP Financial Measures

Pro forma income from continuing operations, Adjusted EBITDA, and Adjusted Free Cash Flow are non-GAAP financial measures. Pro forma income from continuing operations is defined as income from continuing operations excluding start-up/transition expenses, international bid and proposal expenses, and other items as set forth in Table 1 above. Adjusted EBITDA is defined as EBITDA excluding start-up/transition expenses, international bid and proposal expenses, and other items as set forth in Table 3 above. Adjusted Free Cash Flow is defined as income from continuing operations after giving effect to the items set forth in Table 4 above. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measurements of these items is included above in Tables 1, 3, and 4, respectively. GEO believes that these financial measures are important operating measures that supplement discussion and analysis of GEO’s financial results derived in accordance with GAAP. These non-GAAP financial measures should be read in conjunction with GEO’s consolidated financial statements and related notes included in GEO’s filings with the Securities and Exchange Commission.

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Contact:	Pablo E. Paez	(866) 301 4436
	Director, Corporate Relations

NEWS RELEASE

Safe-Harbor Statement

This press release 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: (1) GEO’s ability to meet its financial guidance for 2009 given the various risks to which its business is exposed; (2) GEO’s ability to successfully pursue further growth and continue to enhance shareholder value; (3) GEO’s ability to access the capital markets in the future on satisfactory terms or at all; (4) risks associated with GEO’s ability to control operating costs associated with contract start-ups; (5) GEO’s ability to timely open facilities as planned, profitably manage such facilities and successfully integrate such facilities into GEO’s operations without substantial costs; (6) GEO’s ability to win management contracts for which it has submitted proposals and to retain existing management contracts; (7) GEO’s ability to obtain future financing on acceptable terms; (8) GEO’s ability to sustain company-wide occupancy rates at its facilities; and (9) other factors contained in GEO’s Securities and Exchange Commission filings, including the forms 10-K, 10-Q and 8-K reports.

Third quarter and first nine months 2009 financial tables to follow:

Contact:	Pablo E. Paez	(866) 301 4436
	Director, Corporate Relations

NEWS RELEASE

THE GEO GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THIRTEEN AND THIRTY-NINE WEEKS ENDED
SEPTEMBER 27, 2009 AND SEPTEMBER 28, 2008
(In thousands, except per share data)
(UNAUDITED)

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	September 27, 2009			September 28, 2008			September 27, 2009			September 28, 2008
Revenues	$	294,865		$	254,105		$	830,305		$	786,553
Operating expenses		234,408			199,252			655,592			628,274
Depreciation and amortization		9,616			9,329			29,062			27,523
General and administrative expenses		15,685			16,944			49,936			51,825
Operating income		35,156			28,580			95,715			78,931
Interest income		1,224			1,878			3,520			5,580
Interest expense		(6,533	)		(7,309	)		(20,498	)		(21,667	)
Income before income taxes, equity in earnings of affiliate and discontinued operations		29,847			23,149			78,737			62,844
Provision for income taxes		11,493			8,430			30,324			23,616
Equity in earnings of affiliate, net of income tax provision of $352, $276, $936 and $819		904			778			2,407			2,009
Income from continuing operations		19,258			15,497			50,820			41,237
Income (loss) from discontinued operations, net of tax provision (benefit) of $0, $348, $(216) and $875		—			362			(346	)		1,228
Net income	$	19,258		$	15,859		$	50,474		$	42,465
Weighted-average common shares outstanding:
Basic		50,900			50,626			50,800			50,495
Diluted		51,950			51,803			51,847			51,820
Income per common share:
Basic:
Income from continuing operations	$	0.38		$	0.31		$	1.00		$	0.82
Income from discontinued operations		—			—			(0.01	)		0.02
Net income per share-basic	$	0.38		$	0.31		$	0.99		$	0.84
Diluted:
Income from continuing operations	$	0.37		$	0.30		$	0.98		$	0.80
Income (loss) from discontinued operations		—			0.01			(0.01	)		0.02
Net income per share-diluted	$	0.37		$	0.31		$	0.97		$	0.82

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Contact:	Pablo E. Paez	(866) 301 4436
	Director, Corporate Relations

NEWS RELEASE

THE GEO GROUP, INC.
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 27, 2009 AND DECEMBER 28, 2008
(In thousands, except share data)

	September 27, 2009		December 28, 2008
	(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents	$	24,299	$	31,655
Restricted cash		13,219		13,318
Accounts receivable, less allowance for doubtful accounts of $549 and $625		224,638		199,665
Deferred income tax asset, net		17,340		17,340
Other current assets		13,347		12,911
Current assets of discontinued operations		—		7,031
Total current assets		292,843		281,920
Restricted Cash		21,821		19,379
Property and Equipment, Net		969,218		878,616
Assets Held for Sale		4,348		4,348
Direct Finance Lease Receivable		36,822		31,195
Deferred Income Tax Assets, Net		4,417		4,417
Goodwill		22,339		22,202
Intangible Assets, Net		11,596		12,393
Other Non-Current Assets		37,688		33,942
Non-Current Assets of Discontinued Operations		—		209
	$	1,401,092	$	1,288,621
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	65,338	$	56,143
Accrued payroll and related taxes		22,934		27,957
Accrued expenses		92,887		82,442
Current portion of capital lease obligations, long-term debt and non-recourse debt		19,186		17,925
Current liabilities of discontinued operations		—		1,459
Total current liabilities		200,345		185,926
Deferred Income Tax Liability		14		14
Other Non-Current Liabilities		33,155		28,876
Capital Lease Obligations		14,601		15,126
Long-Term Debt		408,579		378,448
Non-Recourse Debt		102,415		100,634
Total shareholders’ equity		641,983		579,597
	$	1,401,092	$	1,288,621

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Contact:	Pablo E. Paez	(866) 301 4436
	Director, Corporate Relations