Private prison operator GEO Group Inc. (GEO) Tuesday reported a 4 percent increase in profit for the second quarter on higher revenues. Looking ahead to fiscal 2012, the company tightened its earnings outlook, while lowering its forecast for revenues. The company also increased its quarterly dividend.
U.S. Corrections & Detention revenue for the quarter rose 7 percent from last year to $246.1 million.
GEO Care reported a slight decline in revenues to $110.3 million, as continued growth in GEO Care's electronic monitoring services and day reporting centers were offset by the deactivation of the 177-bed Brooklyn Residential Reentry Center in the third quarter of last year.
International Services revenue increased 1 percent to $56.0 million, reflecting the activation of the Dungavel House Immigration Removal Centre in Scotland in the third quarter of last year. This was partially offset by the deactivation of the Campsfield House Immigration Removal Centre in England in the second quarter of the prior year.
Boca Raton, Florida-based GEO Group's second-quarter net income was $22.50 million or $0.37 per share, up from $21.58 million or $0.33 per share in the prior-year period.
Excluding items, adjusted earnings increased to $25 million or $0.41 per share from $24.8 million or $0.38 per share in the previous-year quarter.
On average, seven analysts polled by Thomson Reuters expected the company to report earnings of $0.40 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter rose 4 percent to $412.35 million from $396.80 million in the year-ago period Analysts had a consensus revenue estimate of $413.75 million.
Looking ahead to the third quarter, GEO expects adjusted earnings of $0.42 to $0.43 per share on revenues of $410 million to $415 million. Analysts currently expect earnings of $0.43 per share on revenues of $416.42 million.
For the fourth quarter, the company expects adjusted earnings of $0.42 to $0.43 per share on revenues of $413 million to $418 million.
For fiscal 2012, GEO Group tightened its adjusted earnings outlook and cut its revenue expectations.
The company now expects full-year adjusted earnings of $1.56 to $1.58 per share on revenues of $1.64 billion to $1.65 billion. Earlier, the company expected adjusted earnings of $1.54 to $1.60 per share on revenues of $1.65 billion to $1.66 billion.
Analysts currently expect earnings of $1.55 per share for the year on revenues of $1.66 billion.
Additionally, GEO Group increased the quarterly dividend of $0.20 per share, which will be paid on September 7, 2012 to shareholders of record as of the close of business on August 21, 2012.
GEO closed Tuesday's trading at $23.99, up $0.38 or 1.61 percent on a volume of 561,668 shares. In after-hours, the stock further gained $0.49 or 2.04 percent to $24.48.
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