The GEO Group, Inc. (NYSE:GEO) revealed that the Federal Bureau of Prisons (BOP) has terminated the contract modification relating to the operation of the D. Ray James Correctional Facility under the existing agreement, which was to be effective until September 30, 2022.
Currently, The GEO Group and the Federal BOP are in talks as to how to proceed. The latter is expected to issue a new contract modification under the new terms of agreement.
The GEO Group’s Partnership with Federal BOP
The partnership between The GEO Group and Federal BOP has long been in the works, dating back to the 1990s. As a federal unit, the Federal BOP benefits from the cost-effective, high-quality correctional facility offerings of The GEO Group. In line with this, the company hopes to continue its longtime public-private partnership with the Federal BOP in a prison-industrial complex of sorts.
An expected contract modification to be issued by the Federal BOP relating to the operation of the D. Ray James Correctional Facility, according to George Zoley, The GEO Group Chairman and CEO, will further emphasize the agency’s confidence in the company’s services.
Q2 Financial Highlights
The GEO Group has issued its second quarter earnings report earlier this month.
For the period, it had a total of $138.10 million in net operating income, which is up year-over-year from $121.30 million. The company had a net income attributable to shareholders of $23.20 million, which is down year-over-year from $28.30 million. This is equivalent to a net income per diluted share of $0.31, which is down year-over-year from $0.38. Meanwhile, revenue came in at $548.40 million, which is up year-over-year from $445.90 million.
For the fiscal year (FY) 2016, The GEO Group expects a total of $2.18 billion in revenue. On the other hand, the company expects a revenue of about $565 million to $570 million for the third quarter. For the fourth quarter, The GEO Group forecasts revenue to come between $550 million and $555 million.
Moreover, the company projects an earnings per share (EPS) of about $0.52 to $0.54 and $0.52 to $0.55 for the third and fourth quarters, respectively.