Good morning and welcome to The GEO Group First Quarter 2015 Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Pablo Paez, Vice President of Corporate Relations. Sir, please go ahead.

Thank you, operator. Good morning, everyone, and thank you for joining us for today’s discussion of the GEO Group’s First Quarter 2015 Earnings Results. With us today is George Zoley, Chairman and Chief Executive Officer; Brian Evans, Chief Financial Officer; John Hurley, President of GEO Corrections & Detention; and Ann Schlarb, President of GEO Care. This morning we will discuss our first quarter performance and current business development activities. We will conclude the call with a question-and-answer session. This conference call is also being webcast live on our website at www.geogroup.com. Today, we will discuss non-GAAP basis information. A reconciliation from non-GAAP basis information to GAAP basis results is included in the press release and supplemental disclosure we issued this morning. Additionally, much of the information we will discuss today, including the answers we give in response to your questions, may include forward-looking statements regarding our beliefs and current expectations, with respect to various matters. These forward-looking statements are intended to fall within the Safe Harbor provisions of the security laws. Our actual results may differ materially from those in the forward-looking statements, as a result of various factors contained in our Securities and Exchange Commission filings, including the Form 10-K, 10-Q and 8-K reports. With that, please allow me to turn this call over to our Chairman and CEO, George Zoley. George?

Thanks, Pablo, and good morning to everyone. Thanks for joining us as we review our first quarter results and provide an update for our efforts to pursue quality growth opportunities and create value for our shareholders. As we disclosed in our earnings announcement this morning we reported $0.72 per share in adjusted funds from operations for the first quarter 2015, which is at the top end of our previously issued guidance. This represents a year-over-year increase despite the impact from the strengthening of the U.S. dollar on our international operations and higher interest expense in share account compared to a year ago. We are pleased with our strong first quarter results and we continued to optimistic regarding the outlook for our company and for several reasons. First as we’ve previously announced we are schedule to activate our 1,940-bed Great Plains Facility in Oklahoma. This company-owned facility was awarded a 10-year contract with the Federal Bureau of Prisons and we expect to start intake in June. We are also schedule to complete our $45 million expansion of our Company-owned Adelanto, California, ICE detention facility. This expansion will provide 640 additional beds and a new capacity of 1,940-beds with intake schedule to begin in July. In addition earlier this week, we announced a mobilization of our Company-owned North Lake Correctional Facility in Michigan during the second quarter. The decision to mobilize this facility was made as a result of the current demand for out-of-state correctional bed space. The mobilization will entail hiring staff and purchasing supplies in order to prepare the previously idle facility to receive inmates. While we do not currently have a contract to house inmates at the facility, we believe that we may secure one or more contracts in the near future and expect we may need to activate…

Thank you, George, and good morning to everyone. Before addressing our quarterly results for those investors new to GEO, I would like to briefly touch upon our Company’s attractive investment characteristics, which are underpinned by a robust real estate portfolio of Company-owned and leased facilities. Our total real estate portfolio encompasses more than 17 million square feet in owned, leased and managed facilities; and we own more than 4,000 of acres of land across the United States. We currently own or lease approximately 70% of our facilities worldwide and approximately 70% of our net operating income is generated by our Company-owned and Company-leased facilities. We have stable and sustainable income through increasingly longer term contract arrangements. We have a diversified base of investment-grade government customers with multiple individual contracts, with no single customer contract representing more than 5% of our revenues. We have historically enjoyed solid occupancy rates in the mid to high 90s and strong customer retention rates in excess of 90%. Our long-term assets have a physical useful life of as long as 75 years or longer and require relatively low levels of maintenance CapEx, estimated at approximately 5% of our net operating income. Moving to our financial results, we are pleased with our first-quarter results. As disclosed in our press release today, our adjusted funds from operations for the first quarter 2015 increased $0.72 per share, $0.71 per share for the first quarter of 2014. Our adjusted EPS for the first quarter was $0.41, which reflects an adjustment for $1.6 million net of cash and one-time transaction expenses related to our previously disclosed LCS acquisition. On a GAAP basis, we reported first quarter 2015 net income attributable to GEO of $0.39 per share in line with the first quarter a year ago. Our revenues for the first…

Thanks, Brian, and good morning to everyone. I’d like to address select publicly known business development opportunities in our key segments, starting with the federal market and the three federal government agencies that we serve. As we had previously reported, GEO has a long-standing partnership with the Federal Bureau of Prisons, the United States Marshals Service, and the U.S. Immigration and Customs Enforcement, or ICE; and we provide cost-effective solutions for them at a number of facilities across the country. We continued to see meaningful opportunities for us to partner with all three of these federal agencies, particularly as increased emphasis is placed on offender rehabilitation programs and community reentry services. With respect to our 2015 scheduled project activations, in March of this year we began the intake process at our 400-bed Company-owned Mesa Verde Detention Facility in California under an agreement with ICE. We had previously completed a $10 million renovation of the Mesa Verde Detention Facility, which is expected to generate approximately $17 million in the annualized revenues. During the second quarter, we expect to begin intake at our 1,940-bed Company-owned Great Plains Correctional Facility in Oklahoma under a new 10 year contract with the Federal Bureau of Prisons, which is expected to generate approximately $35 million in annualized revenues. In California, we are scheduled to complete the development of $45 million expansion of our Company-owned Adelanto ICE detention facility in July 2015. This important expansion will increase the facility’s capacity from 1,300 beds to 1,940 beds and is expected to generate approximately $21 million in additional annual revenues. Finally in Texas we are developing a $36 million expansion to our Company-owned Karnes ICE Residential Center, which will add 626 beds brining the centers capacity to 1,158 beds. The 626 bed expansion is expected to be completed by…

Thank you, John and good morning everyone. Turning to our GEO Care segment, each of our divisions continues to pursue several new growth opportunities. Our reentry services division continues to work with existing and prospective local and state correctional customers to leverage new opportunities in the provision of community based reentry services in both residential facilities and nonresidential day reporting centers. We activated two new day reporting centers in the first quarter these are in Baton Rouge, Louisiana, and Chatham, Illinois. We were also awarded four new Louisiana day reporting center contracts in the first quarter, which are scheduled for activation in the second quarter. These six new contracts are expected to generate more than $3 million in annualized revenues. With respect to our residential reentry centers, late last year we activated a new Company-leased 240-bed residential reentry center in Newark under a contract with the state of New Jersey, which is expected to generate approximately $5.5 million in annualized revenues. Our youth services division continues to work towards maximizing the utilization of our existing asset base and has continued to undertake several marketing and consolidation initiatives to increase the overall utilization of our existing youth services facilities. Our Ohio and Texas facilities have continued to experience a strong censes, consistent with the higher occupancy rates experienced last year. Finally, our BI subsidiary continues to market its supervision and electronic monitoring services to local, state and federal correctional agencies nationwide. Overall BI continues to grow its market share of the electronic monitoring market in the United States and during the first quarter of 2015, BI’s revenues increased 11% year-over-year. At this time I will turn the call back to George for his closing remarks. George?

Thank you, Ann. In closing we’re pleased with our first quarter results remain optimistic about the outlook for our company. We have updated our guidance for the balance of the year to reflect several factors primarily reflecting our second quarter, however despite these near-term challenges we are looking forward to several imminent drivers of growth. In the next 60 to 90 days, we expect to which activate approximately 4,300 beds at three facilities located in California, Oklahoma and Michigan. In the fourth quarter we will activate a 626 bed expansion at the Karnes, Texas, Residential Center. In Victoria, Australia, we are developing a $700 million, 1,300 bed facility that will have the most expansive offender rehabilitation program in the world. This new organic growth activity is the most significant that we have experienced in some time. Additionally we’re successfully integrated 6,500 new beds from the LCS acquisition and are working diligently to improve the operational and financial performance of these new assets we’ve done in the past. We are pursuing several publicly known opportunities and also exploring a number of other non-public opportunities for the development of new projects and the potential purchase of additional assets. We believe that our diversified growth and investment strategies are position GEO has the world’s leading provider of corrections, detention and offender rehabilitation services. We expect all these efforts will continue to drive growth for our company, and we remain focused on effectively allocating capital to enhance value for our shareholders. This concludes our presentation. I would now like to open the call to your questions.

Our first question comes from Kevin McVeigh from Macquarie. Please go ahead.

Great. Thanks, and thanks for the update. Hey, George, I wanted to focus more or Brian -- on LCS, the integration on that, and kind of that where you see the incremental upside relative to initial expectations, and how we should think about flow through in terms of filling some of that incremental capacity if we could.

Well, I think, to summarize we have assign the eight facilities to our Eastern and Central region. Our people had met with the new clients. We’ve made some changes in the management at those facilities. We are doing some physical plant improvements and we are further strengthening our operations, and letting the clients know that those facilities are under new management and ready for more responsibilities and our, the responses we’ve gotten so far for the clients are have been very positive, and we are optimistic that in over some period of time. We will be able to improve the operational and financial performance of those facilities, as we have done with past acquisitions.

Okay. And then in terms of California, I mean it seems like you have spent a concerted effort obviously to add capacity there. Is there anything you are seeing? Kind of is it, more of positioning more for a state opportunity, counties? Or how are we thinking about the opportunity in California just relative to, obviously the state continues to bump up and not really be able to address the overcrowding issues that they are under order to meet.

Well, we see California as an important location for both our federal clients as well as the state of California. I think it’s known that California has met their latest objectives this year for achieving capacity milestones but as they approach next year’s milestones, they will be considering other options. Because facilities and capacity just doesn't appear overnight. These things have to be planned, and it will take several months. I am not aware of any significant existing available capacity by anybody. Any new capacity in that state, will have to be constructed by somebody. All of our previously idled facilities have now been re-commissioned either for California or for federal clients.

That’s helpful. Then one more

And the -- facilities in the State of California but we do have additional opportunities to additional capacity but it will take new construction to do so.

Got it. And then, George, if I could, any updates on Florida in terms of potential opportunities there?

Well, the session is, I think, abruptly stopped and will reconvene in the near future. So, as most of the other states around the country, they are in session and you really don’t know the outcome of any new opportunities until the sessions are completed, which is usually late June.

Okay. Thank you very much.

[Operator Instructions] The next question comes from Tobey Sommer from SunTrust. Please go ahead.

Thank you. Wanted to ask a question in the context of your activity with the Michigan facility. Is there a slight change in tone or a broad change in tone, in the urgency and kind of just-in-time nature of the demand that you are hearing, you may get from clients? Or is this a more specific and isolated instance, where there are a couple of clients that may need beds in a short time frame? Thanks.

Well, in considering the opening of that facility we’ve been focused on the timelines necessary to do with the effective recruitment and training of people for an opening; and that requires approximately eight weeks. So, that has been the focus of our planning that, since we concluded we needed that minimal time period, and when you begin recruitment and training, those are public actions. We felt obligated to give a public notice of what we’re doing with that facility because we’re hopeful that we can reactivate that facility over the next 60 to 90 days. And we need to be begin our preparations which will become very quickly, publicly apparent to a number of parities.

Do you have prospects, do you think, to occupy the facility fully?

Well, we are hoping to activate the entire facility.

Okay. And given how idle beds are declining pretty rapidly, I'm curious if you think that changes the way your customers that are experiencing some inmate population growth engage with you and think about their planning. Does that increase their desire to lock something up ahead of time, for example? Thanks.

Well, there certainly are some states on a state-by-state basis that are continuing to experience overcrowding and in need of capacity and we’ve had conversations with them about what we have available. But as you point out, it's a declining supply, at least on our side and in some locations that the only solution will be new construction. While we have, as I said previously, approximately 2,000 idle beds. I think there is much more need than that around the country and we expect to see continued growth not withstanding any present discussions for judicial reform that may affect prison populations.

So is it fair to say that looking out into ‘16 or ‘17, you are more likely to be engaged in new construction and utilizing some capital as you look out a little farther?

Yes, I would think by 2017, we hopefully will not have any idle facilities and will be looking at all new Greenfield construction projects.

Thank you very much for your time.

The next question comes from Brian Hoffman from Avondale Partners. Please go ahead.

Good morning and thank you for taking the questions. First, can you give us a range of how much the Michigan opportunity contributes to your 2015 revenue guidance?

Well, right now what we’ve put into the guidance for Michigan is the start-up costs and the start-up-related activity that George discussed. We haven’t included any revenue or associated profit with potential activation of the facility.

Got it. Okay. Thank you. And then can you give us any details on how much foreign exchange rates impacted the first quarter? And then specifically, how much of that shows through the Australian construction revenues, if any, versus operating revenues?

I think FX in the first quarter was probably about $6 million to $7 million and about that half of that is in related to construction.

Got it. Thank you. And then with respect to ICE, we are starting to see in the news that there’s an expectation of another surge in immigration this summer. And given the reallocation of funding for ICE that we've seen and new facilities that have opened over the past year, in your view, is ICE prepared to deal with another surge this summer? Or is there a possibility or potential that we see another round of increased funding or facilities there? Thanks.

I really can't speak for ICE, but I'm sure they've had planning sessions on how they deal with different situations, over the years and so we don’t know exactly what those scenarios are, but as we’ve indicated, several of our new expansions are on behalf of ICE.

Got it. Okay. Thank you. And then my last question for you, just going back to the LCS acquisition, when it was acquired you had previously talked about a normalized run rate within 12 to 24 months. Has that timeline changed, or is that still where you are looking at?

I think we are still looking at that timeline.

Okay. Great. That's all for me. Thank you.

Operator, operator, operator?

[Operator Instructions] The next question comes from Ryan Meliker from MLV & Company.

We can't hear the caller's voice. Operator?

Can we move to the next question and we'll see if we can come back to him if there is another question in the queue.

Okay. I am sorry about that. Okay. This concludes our question-and-answer session. I would now like to turn the conference back over to George Zoley for any closing remarks.

Okay. Thank you all for joining us today. We’ll look forward to addressing you in the next quarterly conference call.

This concludes the conference. Thank you attending today’s presentation. You may now disconnect.