GEO - Earnings call transcript Q3 2021

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Operator

Good morning, and welcome to The GEO Group Third Quarter 2021 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. Please note, this event is being recorded. I'd now like to turn the conference over to Pablo Paez, Executive Vice President of Corporate Relations. ahead. go Please

Pablo Paez

Executive Jose Secure Zoley, Chief GEO Financial Brian Good us Board; Operator. results morning, This third and you are thank XXXX Thank today's we morning discussion James the our Officer; joining President George and today us for results. Group's third outlook. Chairman and quarter Black, of Evans, Chief for Gordo, of of Services. Officer; earnings will you, discuss With everyone, Executive The quarter GEO our

We with conference will our supplemental morning. and question-and-answer call in information Today, basis a is at issued basis we GAAP on disclosure non-GAAP non-GAAP we to website included the the live information. basis conclude press call from is this session. A will discuss release also This being investor reconciliation investors.geogroup.com. webcast results

current much provisions including today, our your may will securities within include of forward-looking response Harbor intended the various to statements the laws. fall are the answers and with we the regarding to Additionally, give in matters. These questions, expectations Safe discuss statements forward-looking of respect to information we beliefs

and various Our contained forward-looking statements to Executive that, please of in turn call actual in to materially this the XX-K, George? may a Chairman, including over result our our X-K results those as the filings, reports. With differ from Exchange George Securities Form and Commission factors XX-Q allow Zoley. me

George Zoley

everyone. to morning good and Pablo, you, Thank

resiliency strong of third performance We towards diversified financial with and results believe We year-to-date leverage. the reducing segments. progress our representative our are debt made of strength is business the net pleased quarter in significant our we've our

government services Department immigration and residential years, on of and processing for provide We of U.S. reentry and XX currently federal provider. state we've facilities services For the behalf secure on centers been agencies. Security, centers behalf a Homeland for of trusted over support

under processing reentry and the renewed contracts four including third immigration facility centers, eight state contract Federal correctional Prisons, Bureau we our of with four centers or During quarter, the residential of agencies.

extension month our Facility at in Western Additionally, the we Diego, California. Regional Marshals contract for U.S. six received have Detention a San

into for to Mexico big contract the through notified Florida November we in under of the for our our Clearfield services of October Flightline Homeland previous intergovernmental Further, five-year of base entered Moshannon Consistent agreement a support County, began also September, Valley operator completed end Kingdom. the of the and with in unit in our two-year five-year the to Security. Pennsylvania two a the Department provide providing our the between We third care at we Facility previously United early the new expectations. managed success county In GEO managed of we spring business of Texas discontinuation for Reentry contract only XXXX. were opportunities period non-renewal Facilities under Residential services County our contract of Dungavel of BOP renewal in state Bureau contracts by Guadalupe of New two-year Department contracts and operations New the the Facility of our Florida our a with quarter, Corrections to in agreement Federal Facility at the new X, lease with and with Mexico also transition In Tampa, transitioned Center XXXX. Prisons. began On with the the the announced and only November new a another the

COVID testing challenges Understanding Abbott including for in systems. in challenges delivering mitigate pandemic, remains COVID quality addressing million air million ongoing focus government agency the devices we purification pandemic, invested created behalf $X resources ionization the the $X.X impact bipolar partners. services the the on on of Rapid significant XX the by of our high to Our support operational and while of

the the care to level, already recourse entrusted debt de-leveraging through details our assets approach our reduction tax we a reducing financing. to these compassionate million meeting employees future debt adopted frontline for humane trust. of Brian? have evaluation debt we the of including $XXX balance reduction, review and shareholders guidance. net programs. best turn approximately regarding to estate to initiatives sales the our and facilities $XXX our $XXX businesses, the call over corporate quarter. of real and by and our considerations other At concerns address to proud recourse and address on the in are results are XXXX. all to ongoing We're our as interest our reduced proactively continued stakeholders a our previous focus on and board and Thus, in more these We of as end our value. third investment goal focused multi-faceted At Evans to sheet. I'll board we net have We We several million our those by debt and our been recognize company-owned access maturities remain shareholder full-year and there Accordingly, enhance these our a our the and potential address to debt initiatives review million of provide believe this have and concerns, of work who've our management long-term to pleased Brian time, of structure to

Brian Evans

approximately to Good Today attributable George. income revenues quarter we $XX.X in of third of GEO million net million. everyone. morning, $XXX Thank reported you,

the pre-tax attributable benefit on GEO. $X.X $X M&A $X pre-tax. of adjustments in Our third net one-time an our expenses quarter youth tax results A assets, previously income announced loss contracts million effective to loss pre-tax related included real divestiture services million the on to $XXX,XXX estate in million and

and adjusted $X.XX $X.XX income items, AFFO of share. these diluted net of quarter per per third reported diluted we Excluding share,

fourth million on guidance quarterly million our to expect GEO we attributable million $XX to between Moving of XXXX $XXX net to quarter and million. $XXX to revenues $XX income be

to adjusted $X.XX and be expect AFFO diluted and XXXX be XXXX $X.XX We share $X.XX and income between quarter net fourth quarter per diluted $X.XX to between share. per fourth

income we million attributable For $XXX.X in billion. a XXXX the full-year to revenues be $X.XX of range approximately $XXX GEO net to of to full-year and million XXXX, expect

to be to XXXX a $X.XX We adjusted $X.XX share. of in range income diluted expect net per full-year

XXXX AFFO to of $X.XX full-year $X.XX diluted to range share. expect be a in We per

full-year to We EBITDA million. range be $XXX $XXX.X XXXX a to in adjusted of million expect

at of our of capital from resulting quarter, hand, the drawdown had facility. structure cash primarily to the we previously credit third million end announced Moving $XXX approximately on in our revolving the

due maintain $X.X at not lease we revolver billion Accounting hand, debt notes options mortgage our believe debt on recourse for corporate recourse and cash course address a our credit reasonable debt, draw to corporate precautionary flexibility, our on examining for step preserve We obligations to million financial decision on our maturities, XXXX non-recourse current cash additional our funded our in including to maturities our funds of obtain XXXX on financed performance, debt our which liquidity, to facility. able for Our net and including purposes. headquarters. senior in return. secured address our encompass general was hand proactively our near-term $XXX on our our approximately steady With the will currently be stands conservative unsecured loan we're financial and

recourse balance focusing have leveraging reduction $XXX We sheet. net million. debt approach, de debt reduced by to multifaceted our on execute In approximately our continued XXXX, we our and

approximately nine of million debt previously already to reducing for sheet. articulated During on we months XXXX. $XXX full-year leveraging $XXX remain meeting We million intend XXXX, to by balance goal reduced debt million have and reduction the first recourse that by de of our recourse the further focused $XXX net debt our

debt net we of quarter to XXXX, fourth recourse million. $XX to our expect the by reduce additional $XX During an

in bed the approximately corporate tax third we our our of board respect businesses, capital totaling announced ongoing alternatives, strategy also Our and sale assets, for us potential With in real of by our Queens X,XXX exploration of quarter, legal completed of our assets includes to York Year-to-date, including completed structure New beds. the sell we during $XX sales advisors evaluation initiatives various Detention five million. to company-owned financial assist Facility to the have the opportunities estate previously sale we've and our structure. XXX of engagement reviewing and asset

completed At Services. quarter, to time, will Services of review our On proceeds a turn of we Black net James over During our call the divestiture the combined a the sales this Secure GEO third generated for of I also million. $XX basis, these contracts. Youth approximately

James Black

Thank everyone. Good morning, Brian. you,

operational the COVID Our of to provide the care focus as to pandemic, our challenges during third remained on frontline quarter ongoing the addressing those to our facilities. continue and services employees compassionate entrusted has quality

with We practices are the guidance Prevention. mitigation initiatives continue that Control for the consistent and issued by Disease Centers on to focus implementing and

by be Executive to significant as made as have to our we needed. paid investment made Test intake remain and Rapid cleaning across Devices access have supplies And noted facilities. of XXXX, at $X facilities Abbott employees leave start has since allowed available able million continue isolate mask and Face continued across paid have pandemic. of positive the time approximately quarantine our to home which to off Our our cases. be and Through XXX,XXX the a administered arrivals Chairman, we and us COVID deploy October end screen of had at tests Secure facilities, Services new to to to the

million Services and bacteria bipolar at systems reduce viruses. facilities ionization the $X.X Select to install airborne We spread also of invested to

facilities XX,XXX the have government been XXXX, our vaccination have end individuals the and in XX% increase At rates agency of local at facility. with been fully our to October vaccinated, We Secure approximately the departments in facilities. working our partners approximately Services population health closely our representing of

to and services based of renewed on with and support Security. other we four behalf respect With by We during the quarter, the centers, provide mitigation recent immigration best third processing make we Department we'll efforts will the of practices. contract activity, our where U.S. CDC adjustments Homeland guidance evaluate on updated contracts

more fields, services immigration and screen the by safe provided centers contract to a five-year access and artificial amenities the Homeland between healthcare centers approximately registered individuals turf are needed sensitive exercise needs. appropriate TVs are at diverse centers by provide covered entrusted organizations at access Valley telephones, and to health flat rated at is pavilions, for processing to immigration the to processing include to based year entered and we soccer of a and with which immigration connection and national and facility at in Support opportunities. also care meals facilities, accreditation centers environment. in five processing humane support equipment. state areas, County, full The our and housing have XX/X those double our services of clothing, that Moshannon our County in Department outdoor who services approved health correctional are with We Clearfield and rooms, healthcare culturally services legal numerous treatment Pennsylvania, All staffing mental dieticians, intergovernmental delivered is provide Security. highly than into Recreation multipurpose provide faith these agreement

have Guadalupe New three a the Facility only at new take received of Detention in a In At by management our U.S. for operation lease contract notice date, non-renewal the the out with transition also of a we the our that prior for announced And our agreement facility we managed facilities Bureau Texas Haven the level, consistent Prisons Scotland. Hill and Florida intends San county and operator. Flightline at facility with the We managed the George Big renewals State in quarter, base quarter, another the effective Facilities the in to were Dungavel of notified of contract only two the six month to Western the our our county complete Spring of Mexico XX, Delaware department. facility. third of completed including the rent Mexico end period In Region success of County are The only and County lease XXXX. Pennsylvania, renewals these two-year transitioned that we operationally XXXX. X, the managed the state W. also extension on through this Graceville These November facility facilities. use been deactivations for November During in of we contracts previously began two-year same third the Guadalupe discontinuation October contracts the in expectations, we April New to facility for of has for to the Marshals XXXX. Diego. preparing of Effective and of of received we Corrections the over

be officials will transition. smooth team a with Our working to ensure county

remarks. of in we in our be up to state proposals for the which procurement closing response either in a are our time, state. will over Finally, activity, Gordo this recent to to out preparing review beds, I Care of request Arizona At XXXX can Chief for for with GEO turn call Executive the Jose or Officer located to respect

Jose Gordo

morning, us Good unable James. everyone. GEO you, business Care Ann unit Unfortunately, today. the join Thank is President our of to Schlarb

an update. you pleased to provide I'm However, with

During the and have of the guidance the remained issued the and our mitigation programs consistent quarter, on by reentry facilities focused our with third strategies implementation practices GEO COVID CDC.

of as necessary active guidance appropriate by of XXX-bed center in in to Bureau focus efforts under third have practices. increased time have and masks. to access Prisons. on ensured off our September new make GEO opening sanitation, other services our division leave employees We contract our had deploying continue remain that evaluate with testing face adjustments an paid needed. and to on we'll And and the mitigation reentry Tampa, home updated on Operationally, and efforts as the early paid based our CDC basis, quarter our an and Federal best to with Reentry continue ongoing We the we residential

in opened to for for also provide centers individuals. two the Louisiana with day third Prisons new successfully and XXX reporting the with new agencies. Tennessee centers up We during contracts services correctional And renewed quarter, and Bureau of two residential reporting capacity re-entry day with state Federal in two we to four

independent quarter, agreement the last company-owned ownership of entered we July of estate in an resulted entity. services services completed our of the disclose operating retained real with nonprofit youth X, the contracts on the assignment divestiture which and youth lease contracts, new We six our we entity. facilities into a the As to

suite in of continued we BI, and Moving quarterly pleased technologies. supervision to full provides and division, sequential very monitoring which our a monitoring products with electronic electronic for revenues are growth solutions, the

release future we the Finally, integrates our services. which GEO post of optimistic support rehabilitation, Care Program, in custody be continue Continuum cognitive including about to treatment, of enhanced behavioral with

GEO believe model a to program people lives. provides served We as of is program program system proven of reform, that how part recidivism. successful winning criminal primary U.S. to objective in award and Continuum their better justice Our be can the the GEOs of the Care contribution our changing reduce million justice on the X.X in criminal

in Our efforts with are reforms. competition national conflict or initiatives in not other sentencing offender regarding

fact, In incarcerated comprehensive of many to draw attention and of applaud Continuum GEO Care, more seek need efforts. these With to the approach to in national we still we a our rehabilitation. structured

the real our are our our maturities. potential advisors, our our capital of and government legal that of structure that closing, results essential also concerns cash all address businesses, addressing and in we We the and GEO regarding and that the have balance access we prudent we our opportunities. are be to continues de-leveraging alternatives financial sheet. We company our resilient assets our ongoing with success and potential our and there can board's de-leveraging estate evaluation believe ongoing pleased are We to concerns. that that are believe remains sales tax to taking believe this our towards corporate reducing entailing the We steady and steps of strong towards these pursue of earnings with and and of proactive reduction believe shareholders assistance growth we despite future position work and assets contracts flows We recognize on interest the financial initiative other In balance progress as these our are best stakeholders. that that with review of to structure supported our future debt steps efforts debt evaluation sheet, company-owned additional focus financing, services. our by valuable quality financial significant performance, made diversified of

our to team with together completes to talent, We'd of we management forward to That any our direction the four last I've with opportunity of have future work take professionalism dedication our looking divisions. I'm closely work diversified employees. our team impressed the And had our of across strategic the on with been continue and and board our company. glad business to members months, as I Over be execute questions. remarks. the an

Operator

now begin will Instructions]. session. question-and-answer [Operator We the

comes with question Gomes Joe NOBLE Markets. from first Capital The

You may go ahead.

Joe Gomes

and for taking thanks questions. morning, Good my

that of title to here the There at there. or two. out ICE, So is been month first bit ADP has looking from the issue the XX. information on I ask some whole past on comes wanted falling little a the ICE

Just ICE seeing an been you've to how your populations. trying get on idea

nice And of on any facilities Valley. there be thoughts Are deal Your looking contracts? the to title your enter XX. Moshannon also at recently order new closed ICE in might see other into to that

Jose Gordo

as Moshannon the federal in states. state the all more directed consolidation county the purposes, lease think ICE market the to to Well, facilities recent was our of a contract agencies, of opening surrounding we by of the with with New ICE for facility and State and continue to facility I the of under exemplified Mexico, that idle services

So evaluating located and where they're we've And facilities made so our officials, those the ICE far as geographically, as their to forth. capacities known are they facilities.

Joe Gomes

population of ICE And your terms your in quarter-over-quarter? to

Jose Gordo

during quarter, down the I it the think went up and quarter. at towards of end went it the

the for there's border So approximately really don't coming because we monthly. people XXX,XXX across that know, the reason

So all involved merely selective secure is we're detention, many support as those not times decisions. detention We we've decisions. and in provide housing said those to the

Joe Gomes

Right.

momentum then, that the was type very of in that monitoring electronic the it sold. with just here. business. a times business. in little on if, on Do to businesses? did And example, of you remaining assets. sale Thank the positive any about is The some potential And I the well that a bit rest press call And mentioned been wondering obviously, lose again, was the mentioned driving it couple And that of sale of it could quarter, company there's of be synergies that. wondering, more for your the Okay. you the BI you you potential in business? what comment you

Jose Gordo

were any rules on your prohibited commenting asset by to on potential regard first question, SEC With sales.

we since on really the and -- towards in ISEP the rumors. quarter then substantially has So the the but year, increased it quarter. itself the increase little beginning program can't over But comment bit a the of end in of decreased

Somewhat similar detention. our ICE to

Joe Gomes

from quarter that. wondering, when what that I you behind you just Okay. increased fourth in third you've noticed your quarter? what increase here, lost to attributable guidance where Thank net again, the income the is the And if And at the revenues? call? contracts was I for was guys listen quarter. estimated is fourth for GEO in you some And pardon me it driving

Brian Evans

Well, facilities, And facilities. in seen continuing we're experience occupancies. other I have I or think, think we cost also in some to some in improvements populations our of good control,

And so into the first in quarter, the fourth it's net nine months through year. consistent of we've account taken of those two, the been the pretty

So forward that some we've as assumed well. of going

Joe Gomes

you you're opportunity And state about? Okay. mentioned tell Arizona. that new other in new you on us that Any can working opportunities

Jose Gordo

No, that we public that at this acknowledge the only that's can procurement time.

Joe Gomes

else Okay, for queue back get questions. Thanks asking questions. great. someone and I'll the taking let in

Jose Gordo

Thank you.

Operator

comes next with Our question Ludtke from Capital. Kirk Imperial

You may go ahead.

Kirk Ludtke

of better. wage assumes respect pay to and forced for? you cost well the for that would goes who's ICE I'd that wages? have as to a revisit to this or under I'd responsible, against specifically, that One a you're to as have you BI. to just like New like I'd understand to litigation. pay second. the topics bit couple contracts With a is something that back more a that contract, And ones. is little if Is I and on the the like follow-up wage Mexico And a new minimum a litigation. couple minimum

Jose Gordo

illegal put that the workforce, payment. the employ that's scenario recent against minimum the people highly improbable, have facility emphasize against cannot basis ICE. to be legal wages, Because also who it are to in there's a and highly squarely ruling for ruling described, was for I initially they of to this aliens cannot I they're further probably And Circuit and definition of point into a But a improbable just a out confinement wage employees. being claim law the federal simply Well, is court Court come Appeals not confined, in from how by we in our basis Fourth been -- country. we would on the would because imagine you've subject migrants the in but not pay they're of have

Kirk Ludtke

Okay, thank you. helpful. That's

Jose Gordo

let contracts, our In things. me a add of couple

be cannot our specifically contracts that detainees use in says We the cannot them custody employees. as employees. Our

Kirk Ludtke

-- that Thank compensating? how this respect to the Is terms helpful. are -- are detainees that's or in prisoners suspect of contracts with the the could other you. same Okay, issue be Are I an customers. that

Jose Gordo

that that's the contract themselves as But the in The compensation have in standardized stipulated ICE the and for is partnered And in administer said of contract for of no them, years the that established facility the the each the amount being portion of contribute come one contract. requirement We tax contracts than that's very services made. Department the program the a contract have to and for contract that's well up an reduce been to they as ICE there shall within the be in $X of requires of this A ICE less program predominantly And our required Security. a Homeland ICE contracts. idleness facility payment And all receive. for to terms. that the to and typical running XX that that program opportunity work detainees. the the be voluntary is is to or And And by $X. in Congress. them the is

Kirk Ludtke

respect you. issue? provisions That's state helpful. same The states, to with customers? Are thank Okay, this with the your contract the

Jose Gordo

similar are make confined it's probably law payment varies not operate, payments more to no more dollars facility. inmates facility probably the Though, incarcerated own in In makes that. that we in it from that in more. that we minimum requires than And their it's any a state-to-state. under state state the we of wage come But who the no No, to be in payment would pursuing would state that facilities. few

Kirk Ludtke

respect Mexico to New --? Okay, thank you. With

Jose Gordo

Yes.

Kirk Ludtke

assume might of states Yes. -- be where states that other this curious trend I'm this the you think Are operation, if the beginning facilities. is a there operations of

think do What the you you'd profitability general? profitability and the other it's the before if the similar? to the more? something leasing And about in facility mean, are of what And like -- interested think I in model transition? so curious you do after how changes I'm states something

Jose Gordo

are We, part idle we're of and model. organizations. business as as other facilities the a the of possibilities We currently marketing very our to our open obviously one leasing is it's model to And governmental REIT, it.

very comfortable that with we're concept. So

comfortable and being so with And the us not operator the either being or operator.

Kirk Ludtke

And the I know don't what make say want it profitability. there, directionally more profitable you or to after transition? is you the specifically less but

Jose Gordo

depends on transition, what It depends occurred whether before of the all on facility. the the prior levels occupancy

So it. of there's a lot factors go that into

So experience generalize can't on I the of one really situation.

Kirk Ludtke

Got it.

for moving CapEx this the Is a in Okay. run a you. run picked rate about revenue good say sequentially, And was it rate? a Thank I to this second. should BI thinking was bit for but quarter, quite up a is, BI? we good to CapEx be is which a mean,

Jose Gordo

I we've Well, said as there's some some, think before, transition technology. there's of

$XX So next that complete I'd million million, $X but should to the are now, little bit rates say right year. higher CapEx

they're consistent rate next and this would much after year we're depending how take think some that, that So then be for on experiencing year, it this growing. should I

Kirk Ludtke

That's I there? thank opportunity And it, reports in Alabama. or lastly, there And something, you some is then Okay, a this? about helpful. I press missed mention facility Did you. saw some

Jose Gordo

the for facility. is in potential discussions now their been We've presently interest and purchase several the of with of Alabama years

Kirk Ludtke

But concrete yet? nothing

Jose Gordo

But legislative that. to authorization ahead move need I believe they with

Operator

Our comes with Ramgopal next question Mitra Sidoti. from

ahead. go may You

Mitra Ramgopal

questions. the taking for Thanks morning. good hi, Yes,

on was the of COVID that's of some the you're some easing I levels. curious mentioned? resulting seeing restrictions, any improved First, couple in of just if you occupancy a facilities occupancy at

Jose Gordo

appears inverse virus that treatment of with a the don't individuals are inside it's I going to that we're up if of it know restrictions, and staff protocols. and deal or the we vaccination time. facility rather stepping easing be some program better have the And to to our for

and distancing to year testing better we're social for guess this procedures we're So when out dealing so this and through they second protocols in accustomed forth, longer I within the getting with in people the with virus come go required virus, they facilities as of so our, experience. and

Mitra Ramgopal

I terms I it a XX% If example, restriction changed? of maybe of I remember, was Okay. if in think capacity. for have maybe that wondering might was

Jose Gordo

any No, restrictions. don't know I

Brian Evans

been The facilities, not know there that's was if some or lifted don't I yet. time

Mitra Ramgopal

Okay, okay.

Jose Gordo

And you occupancies. can't go of driven prior on are depends we where wide think difference generally with see the number below it's that I I a And know a XX. can't is you XX still if the of statement don't by in above enforced, factors. statement that But you

Mitra Ramgopal

clearing sentencing And thanks curious the if maybe court U.S. in from increased up. cetera Federal that and for on Okay, level? just you're the of Marshal activity at benefiting et facilities also terms

Jose Gordo

the increase count think we there I has in around a Service general our been for country. Marshals Well, U.S. the facilities in several have Marshals the

Mitra Ramgopal

Okay.

business, it, anything you know don't there's On the I BI to just I if was specifically on drive you're wondering we're doing comment but the increases, seeing there?

Jose Gordo

by the decisions. policy The increase been administration in participant driven really has counts

Mitra Ramgopal

on. that's currently so something focus Okay, you

Jose Gordo

George the of put them those coming not and earlier, of them, across several Certainly at people some border the program. XXX,XXX the individuals Southern per that into activity but [indiscernible] of being mentioned all the border, Yes, month, are. some are

Mitra Ramgopal

to in favorable comment Bill you of Okay, if you got just wondering any the terms you forward? and they were trying that going the California thanks. that pass affect might And had I'm ruling on how

Jose Gordo

the Well, we themselves it in provide to particular a And think that regarding was that benefits government. ruling implementation case, Federal not states allowing provisions use of against the it in the sector did affirm to government time. a for historic cannot facilities and of discriminate state the policy, immigration period sense Federal same private it had the the that

of In it closure the fact, Federal required facility.

against So Federal the that was part inherently of the government. ruling, was that law the XX, State discriminatory

Mitra Ramgopal

front an I you year-end Should as we you're structure. And corporate expect still release? tax think earnings mentioned, Okay. the conjunction the on in with evaluating announcement that

Jose Gordo

would by that sure. say or time for I year-end

Operator

from Coffey Our Wedbush. next question comes with Henry

go ahead. may You

Henry Coffey

location No, the Yes, there thank and there, to monitoring could with Electronic ICE equation really alter from you monitoring, But good BI counts. that obviously, taking morning. I benefiting that is growth something And really manage or? my questions. mainly a a for and have initiatives the are policy an the we you see positive equation the really how cetera, where to new, that but on et would possible from, coming the change rethink initiative immigration would is whole I any mean, populations,

Jose Gordo

it's necessary a program. who initiative. in contract new of the for The for allows think participate itself don't the people I significant numbers in a increase

to as and think in alternatives and is be bipartisan it's popularized therefore, popularity the receiving effective of So And being it cheaper, to a idea continuously used, more and support I detention it's It's you being know, is the gaining basis. on technology improved. its continues usage.

Henry Coffey

is is you in that all who's And this to then wage existing put to pause risk something then, on an minimum to change? if is there and caused clarify, contracts your a situation, at this amendment

Jose Gordo

was become under that don't not in cases Democratic detainees we courts decision. unanimous or negative minimum they're on the work think from in is entitled ruling District Appeals There's it inmates was as facility New no, core were law most March, believe recently, a was democratically confined And No, been the whether have wage prior definition force. And not administrations. of they're unanimous those And this civic law one cannot clear. to it and court on of subject all by in Mexico. the or Judges regarding And lawsuit think people confinement involved judges are I it the we who Fourth to are ruled a of the I ruled in that Court two XXX employees. in recommended

Henry Coffey

an of anomaly substance? of in more some is case view current your the So than

Jose Gordo

workforce. fairly of compensated issue. well was not we're who result understanding there argued. that as workforce Circuit. are the hearing, be law to was the disappointed Yes, of don't being not established undertaken But to Court just under under they're wages. ultimate particular allowed or And different as this they're Appeals case get ability the general accepted not optimistic in first part And circuit, Fourth Washington hours this XX for not the has or Circuit decision they and such very that outcome. it they're day, their confinement, inmates a or confined They're detainees it's are as have is bargain the in Ninth obviously in people do the And treated in court are the time a we in about circuit that employees, the to be in end

Henry Coffey

other a to finally whether kind final the open strain How hold here minimal coming given you and you'll risk that against preventing status? process the issue, from the on then the are decision a resolution? sort issues about stock and cash REIT drop from you at what balancing of one And are quick and cash the and what's combination are of REIT dividend, what's or driving

Jose Gordo

and financial year, think Well, to we've legal look the as with our going at during best I forward. for company working advisors said the the structure we're

just not the it's status. read So

We have deal the debt issues that we need with. to

So a -- an enough it's our when make review, and a make to far decision that with we'll along, we'll total and process comprehensive is announcement regards

Henry Coffey

into give the any what are you hand insight us issues Can at around this?

Jose Gordo

I'm As sure mean by at you far as not what issues hand?

Henry Coffey

looking are When I make to you're trying mean, the the issues what at? decision?

Jose Gordo

for going as market? in we going of we Is value paying wasn't to in Where flow it rates? have is move forward? we're was Is reinvesting looking market reflected forward? fairly the best cash were it Right that get want much how to And the business? value. substantial the Is cash And debt? the necessarily the down that I tax paying do argue that acknowledging and as the the liquidity equity would we substantial previously, Consideration dividend the is How it flows that a how we it at, dividend? generate? are what's company's the we use most company

at our looking year-end. as George And with management that said some of by financial all with we're the So and advisors. reviewing conclusion expect a to board we earlier, things. as to working come them We're team and those

Henry Coffey

preferred capital a dilutive a consider as potentially offering stress or equity the company's the way sheet reduce to debt or… you Would on balance

Jose Gordo

It's we've to us being to Yes, trying help were mindful all process. of all through and engaged the stakeholders strategies engage. that

we'll mindful the the holders of and So holders. equity be debt

Operator

comes Our Sherman with from next question Global. Jordan Ranger

You may go ahead.

BTIG. Oren with It's Shaked me. Forgive

You may go ahead.

Oren Shaked

of re-contracting the George, you characterize morning, idle would having on good potential Hi, how to back facilities. some conversation of that flip? going the

George Zoley

louder, you. hardly bit hear up because Could a you we speak little cannot

Oren Shaked

to Sorry, hear -- me back you going now? can

George Zoley

go Yes, ahead.

Oren Shaked

Okay. Very good.

getting to give you color some just some different front? conversations from idle that you're Going would that characterize parties re-contracting having the you're back of How that you're around Can that us of on with? reception the facilities? you the potential speaking

George Zoley

agencies relatively state and optimistic I both agencies. federal with say, can only we're

Oren Shaked

appreciate I then back that. going Okay, to BI. And

intra during it much the revenue ICE how the off it quarter -- with in about then the for both inter little might app a an and talked ICE You and swing increase towards associated variability tapered quarter? and app give us some was the quarter end. a Maybe bit of of flavor

George Zoley

at the trend guarantees it's the will. it's no prior if general, growth even of Well, is minimum base steady per to service. you our ownership I But rest and been contract, for over ICE period then contract business, EM think look you and for ownership. diem the of the our app of a There the in the if

So, contract the to averaged XX% it's probably to between growth XX%, closer period. X% over

it but steadily goes move upwards. it seems Sometimes in spurts, to

Operator

next Sherman Jordan comes Ranger from Our question with Global.

ahead. go may You

Jordan Sherman

hear me now? thanks. Can guys Yes, you

George Zoley

Yes.

Jordan Sherman

good. Okay,

So happens I Washington, a going you're progress? expect or And at it timeline to from -- the what's appeal. do have wanted how then just least to that you to of to appeal, timeline ask what progress will about here, the just file that court when in of case do

Jose Gordo

month-by-month it the for timeline I and a several the to then established. take appeal think by could heard the thereafter for months case is be months to be for several ruling and

Jordan Sherman

Right.

appeal, through about to file way through its and the clear grind way courts So the that it's its climbs it then is have timeline up the it'll month to -- you courts? the a only as

George Zoley

Yes, yes.

Jordan Sherman

as on -- other year. those. that, if the any conversations, update Okay, what's ICE having perfect. I'm status Apologize that is -- of sure I those? expire separately, mentioned there about comments Then you made missed contracts the this the other

Jose Gordo

contract? Contracts or BOP

Jordan Sherman

you've and Well, Flightline, I noticed Springs the got know Big BOPs, on the BOP right?

Jose Gordo

Yes, year. this we renew contracts there overall is the contract. ICE are Yes, that expired

Jordan Sherman

end the it. of That's

year, a couple? this next So we have year,

Jose Gordo

come Well, have any mean, they we don't renewal se. I their have expirations think couple. per we up a to I always date. even

Jordan Sherman

I've apologize, missed both. I dates. renewal Well,

Jose Gordo

couple a of be could There renewal dates next year.

Jordan Sherman

thoughts Are about how those those in discussion will? already? Any

Jose Gordo

not this Now, not really, at time.

Jordan Sherman

too Still early. Good.

Jose Gordo

early. Yes. Too

Jordan Sherman

Okay.

I You confirm to want wanted mentioned to heard just this I've I -- correctly. clarify,

only is RFP You the the Arizona? said at one in the moment active

Jose Gordo

the mind my to only art well… public comes That

Jordan Sherman

Yes, yes.

Jose Gordo

next hasn't doing the an about Arizona, only RFP one the he RFP. year. But Is why done RFP public talking They're So statement. yet. State

Jordan Sherman

that understanding this year? And I they was the to complete wanted under that

Jose Gordo

No.

be I to I available of a don't decision beds, for award year. single be facility. going the at it's is could think And beds, Because both next that don't early I any -- believe number two awards. X,XXX

Jordan Sherman

notes am I contracts. so their multiple discussion Their Okay, sorry -- be could it --

Jose Gordo

they housing. and cell type high they're prisoners, Because security require

Jordan Sherman

it. Got

Okay.

any So on? with of in Discussions about in public states about there -- of is is terms their RFPs can terms anything possible only comment one. conversations going other you for needs that

Jose Gordo

I No, do conversations there that But can't and are of not RFPs. transactions those kinds require comment.

Jordan Sherman

differently. announced them? go say have other any beds need set Let a looking might it state me for and they a way? Given Is me that that for be

Jose Gordo

I can't comment.

Jordan Sherman

said no they've for I'm are they're and out then so states you for Okay, and quick that there comments made looking has saying, one asking beds, able beds thing. that out I'm to you of are should if type said to… publicly, that publicly, they looking something not say have be those say just

Jose Gordo

time RFP past, Idaho the an necessarily and something. the -- state and a something bunch building facilities all the say new the of one there's President about affirmatively, or mean, to I articles about it can't consolidating things even and way so one stuff Florida, really says saying news of because of speak said in doesn't forth. Senate in think the other larger or lead people I I the

So discussion anything as I it but like know that there's don't industry definitive relates always there's to that, our

Jordan Sherman

at get contract a you'll the other that enough some expectation that is getting some will some the additional have activity you we or least there of able facilities. find the at for shot you -- that your will will around RFPs way Is that be to for contracts

Jose Gordo

Our inclination RFPs. aspirations, not it include our is to our in time do

Jordan Sherman

Got it? Okay.

So think to are facilities facilities down we that plans apologist, that on that discussions or? moment are wind advanced close to there to are -- okay, the Texas either at your move them you The enough can two

Jose Gordo

we the Well, marketing actively them, are wound they're removing two prisoners down and by that's BOP those being locations. relocating but

Jordan Sherman

BOP have will when down? wound guess those I A… fully

Jose Gordo

By the end month. of this

Jordan Sherman

this Okay. end of market? By the

Jose Gordo

inmates the in as far facility. the As

Jordan Sherman

you visibility would you place What in keep those those type or a on potential contracts? of facilities people getting that contract? Does how need hopes sense? make of long Like in could

Jose Gordo

Yes.

George Zoley

under of potential My pending answer opportunities is what review our at are. our review time, this it's

Jordan Sherman

And I guess I've been asked that…

George Zoley

decision. a Yes. made have We

Jordan Sherman

to I close guess How that. are I more matter facility appreciate winds Yes. think a contract? how it’s you? guess if going generically, I separate this down. you you long were

George Zoley

Yes, situational.

Operator

Zoley remarks. addressing concludes very back to I'd any look session. This the for our turn George you one. you the over thank in to next question-and-answer on We closing to participating like conference Well, for forward much call. today's

Operator

concluded. is today's conference for The attending presentation. now Thank you

You may now disconnect.

The GEO Group, Inc. (GEO) 4 Nov 212021 Q3 Earnings call transcript