Boca’s Geo Group expects detention business surge

Boost from immigration enforcement

Boca Raton-based prison operator The Geo Group on Thursday reported lower earnings on higher revenues for its first quarter that ended March 31.

However, Geo chairman and CEO George Zoley told analysts during a conference call Thursday that the company anticipates increased business from the detention of immigrants caught entering the U.S. illegally.

Zoley said a steady stream of illegal border crossings in the southwestern United States has paralleled with increased occupancy at its detention centers, which house people for Immigration and Customs Enforcement and the U.S. Marshals Service. Data released in early April showed the number of people trying to illegally cross into the United States at the Mexico border surged in March, as President Donald Trump decided to deploy the National Guard there, according to media reports.

“We expect it to increase,” Zoley said, adding that Trump has indicated he will be asking for new detention centers in the 2019 fiscal budget starting in October. Geo hopes to get those contracts.

Zoley said he remains “optimistic” that many of the 7,000 idle beds in Geo’s federal prisons will be filled.

The company also has contracts with the Federal Bureau of Prisons, and several state-owned prisons.

Geo said net income was $35 million, or 29 cents per share, a 13 percent decline from $40.4 million, or 35 cents per share, in the first quarter of 2017. GEO reported total revenues of $564.9 million, up nearly 3 percent from $550.6 million for the first quarter 2017.

Geo’s worldwide operations include the ownership or management of 141 prisons or detention centers — existing and under development — totaling about 96,000 beds, with a work force of about 23,000. In Florida, Geo operates prisons in Deerfield Beach, South Bay, Moore Haven, Panama City, Graceville and Milton.

In 2017, the prison operator added to its prison rehabilitation services through the acquisition of New Jersey-based Community Education Centers for $360 million.

In trading Thursday on the New York Stock Exchange, Geo’s stock closed at $22.01 a share, up 10 cents or 0.46 percent.