Tetra Tech (TTEK) 10-Q 29 Jan 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Dec. 27, 2015	Jan. 25, 2016
Document and Entity Information
Entity Registrant Name	TETRA TECH INC
Entity Central Index Key	831,641
Document Type	10-Q
Document Period End Date	Dec. 27, 2015
Amendment Flag	false
Current Fiscal Year End Date	--10-02
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		58,624,247
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q1

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 27, 2015	Sep. 27, 2015
Current assets:
Cash and cash equivalents	$ 125,088	$ 135,326
Accounts receivable - net	593,968	636,030
Prepaid expenses and other current assets	57,198	42,125
Income taxes receivable	13,483	10,294
Total current assets	789,737	823,775
Property and equipment - net	61,295	64,906
Investments in and advances to unconsolidated joint ventures	1,824	1,886
Goodwill	594,004	601,379
Intangible assets - net	35,663	40,332
Other long-term assets	44,971	26,964
Total assets	1,527,494	1,559,242
Current liabilities:
Accounts payable	119,922	150,284
Accrued compensation	91,633	103,866
Billings in excess of costs on uncompleted contracts	96,188	93,989
Deferred income taxes	16,953	20,787
Current portion of long-term debt	13,041	11,904
Estimated contingent earn-out liabilities	1,122	609
Other current liabilities	64,694	69,003
Total current liabilities	403,553	450,442
Deferred income taxes	39,177	34,759
Long-term debt	177,021	180,972
Long-term estimated contingent earn-out liabilities	3,088	3,560
Other long-term liabilities	$ 60,714	$ 32,711
Commitments and contingencies (Note 15)
Equity:
Preferred stock - Authorized, 2,000 shares of $0.01 par value; no shares issued and outstanding at December 27, 2015, and September 27, 2015
Common stock - Authorized, 150,000 shares of $0.01 par value; issued and outstanding, 58,909 and 59,381 shares at December 27, 2015, and September 27, 2015, respectively	$ 589	$ 594
Additional paid-in capital	310,662	326,593
Accumulated other comprehensive loss	(158,545)	(143,171)
Retained earnings	690,837	672,309
Tetra Tech stockholders' equity	843,543	856,325
Noncontrolling interests	398	473
Total equity	843,941	856,798
Total liabilities and equity	$ 1,527,494	$ 1,559,242

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Dec. 27, 2015	Sep. 27, 2015
Condensed Consolidated Balance Sheets
Preferred stock, Authorized shares	2,000	2,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, Authorized shares	150,000	150,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares issued	58,909	59,381
Common stock, shares outstanding	58,909	59,381

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Condensed Consolidated Statements of Income
Revenue	$ 560,708	$ 581,056
Subcontractor costs	(139,752)	(143,976)
Other costs of revenue	(347,796)	(358,281)
Selling, general and administrative expenses	(39,229)	(42,187)
Contingent consideration - fair value adjustments	(1,001)
Operating income	32,930	36,612
Interest expense	(1,660)	(1,790)
Income before income tax expense	31,270	34,822
Income tax expense	(8,030)	(9,176)
Net income including noncontrolling interests	23,240	25,646
Net income attributable to noncontrolling interests	(1)	(71)
Net income attributable to Tetra Tech	$ 23,239	$ 25,575
Earnings per share attributable to Tetra Tech:
Basic (in dollars per share)	$ 0.39	$ 0.41
Diluted (in dollars per share)	$ 0.39	$ 0.41
Weighted-average common shares outstanding:
Basic (in shares)	59,058	62,452
Diluted (in shares)	59,793	63,112
Cash dividends paid per share	$ 0.08	$ 0.07

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Condensed Consolidated Statements of Comprehensive Income
Net income including noncontrolling interests	$ 23,240	$ 25,646
Other comprehensive income, net of tax:
Foreign currency translation adjustments	(16,474)	(24,510)
Gain (loss) on cash flow hedge valuations	1,110	(480)
Other comprehensive loss, net of tax	(15,364)	(24,990)
Comprehensive income including noncontrolling interests	7,876	656
Net income attributable to noncontrolling interests	(1)	(71)
Foreign currency translation adjustments, net of tax	(10)	(59)
Comprehensive income attributable to noncontrolling interests	(11)	(130)
Comprehensive income attributable to Tetra Tech	$ 7,865	$ 526

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Cash flows from operating activities:
Net income including noncontrolling interests	$ 23,240	$ 25,646
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	9,805	12,992
Equity in income of unconsolidated joint ventures	(202)	(650)
Distributions of earnings from unconsolidated joint ventures	205	810
Stock-based compensation	2,792	2,840
Excess tax benefits from stock-based compensation	(118)	(142)
Deferred income taxes	928	4,846
Provision for doubtful accounts	7,019	(1,150)
Fair value adjustments to contingent consideration	1,001
Gain on disposal of property and equipment	(176)	(51)
Changes in operating assets and liabilities, net of effects of business acquisitions:
Accounts receivable	30,415	35,617
Prepaid expenses and other assets	(8,648)	769
Accounts payable	(30,361)	(59,382)
Accrued compensation	(12,233)	(13,348)
Billings in excess of costs on uncompleted contracts	2,199	3,539
Other liabilities	(1,309)	(6,156)
Income taxes receivable/payable	(942)	(726)
Net cash provided by operating activities	23,615	5,454
Cash flows from investing activities:
Capital expenditures	(3,250)	(7,137)
Proceeds from sale of property and equipment	704	5,216
Net cash used in investing activities	(2,546)	(1,921)
Cash flows from financing activities:
Payments on long-term debt	(2,802)	(15,926)
Proceeds from borrowings		13,493
Payments of earn-out liabilities	(1,001)
Excess tax benefits from stock-based compensation	118	142
Repurchases of common stock	(25,000)	(20,167)
Dividend paid	(4,713)	(4,372)
Net proceeds from issuance of common stock	4,085	1,521
Net cash used in financing activities	(29,313)	(25,309)
Effect of foreign exchange rate changes on cash	(1,994)	(1,713)
Net decrease in cash and cash equivalents	(10,238)	(23,489)
Cash and cash equivalents at beginning of period	135,326	122,379
Cash and cash equivalents at end of period	125,088	98,890
Cash paid during the period for:
Interest	1,743	1,867
Income taxes, net of refunds received of $0.4 million for both periods	$ 8,793	$ 4,700

Condensed Consolidated Stateme7

Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Condensed Consolidated Statements of Cash Flows
Income taxes, net of refunds received	$ 0.4	$ 0.4

Basis of Presentation

Basis of Presentation	3 Months Ended
	Dec. 27, 2015
Basis of Presentation
Basis of Presentation	1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related notes of Tetra Tech, Inc. (“we,” “us” or “our”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. They do not include all of the information and footnotes required by GAAP for complete financial statements and, therefore, should be read in conjunction with the audited consolidated financial statements and related notes contained in our Annual Report on Form 10-K for the fiscal year ended September 27, 2015. These financial statements reflect all normal recurring adjustments that are considered necessary for a fair statement of our financial position, results of operations and cash flows for the interim periods presented. The results of operations and cash flows for any interim period are not necessarily indicative of results for the full year or for future years. We report our water resources, water and wastewater treatment, environment and infrastructure engineering activities in our Water, Environment and Infrastructure (“WEI”) reportable segment. Our Resource Management and Energy (“RME”) reportable segment includes our natural resources, energy, waste management, remediation, utilities and international development services. We report the results of the wind-down of our non-core construction activities in the Remediation and Construction Management (“RCM”) reportable segment. In the first quarter of fiscal 2016, we re-aligned certain operating units within our reportable segments to improve organizational effectiveness by better aligning operations with similar clients and projects (see Note 10, “Reportable Segments” for further discussion). Prior year amounts for reportable segments have been revised to conform to the current-year presentation.

Accounts Receivable - Net

Accounts Receivable - Net	3 Months Ended
	Dec. 27, 2015
Accounts Receivable - Net
Accounts Receivable - Net	2. Accounts Receivable – Net Net accounts receivable and billings in excess of costs on uncompleted contracts consisted of the following: December 27, 2015 September 27, 2015 (in thousands) Billed $ $ Unbilled Contract retentions Total accounts receivable – gross Allowance for doubtful accounts Total accounts receivable – net $ $ Billings in excess of costs on uncompleted contracts $ $ Billed accounts receivable represent amounts billed to clients that have not been collected. Unbilled accounts receivable represent revenue recognized but not yet billed pursuant to contract terms or billed after the period end date. Most of our unbilled receivables at December 27, 2015 are expected to be billed and collected within 12 months. Contract retentions represent amounts withheld by clients until certain conditions are met or the project is completed, which may be several months or years. The allowance for doubtful accounts represents amounts that may become uncollectible or unrealizable in the future. We determine an estimated allowance for uncollectible accounts based on management’s consideration of trends in the actual and forecasted credit quality of our clients, including delinquency and payment history; type of client, such as a government agency or a commercial sector client; and general economic and particular industry conditions that may affect a client’s ability to pay. Billings in excess of costs on uncompleted contracts represent the amount of cash collected from clients and billings to clients on contracts in advance of revenue recognized. The majority of billings in excess of costs on uncompleted contracts will be earned within 12 months. Once contract performance is underway, we may experience changes in conditions, client requirements, specifications, designs, materials, and expectations regarding the period of performance. Such changes result in “change orders” and may be initiated by us or by our clients. In many cases, agreement with the client as to the terms of change orders is reached prior to work commencing; however, sometimes circumstances require that work progresses without obtaining a definitive client agreement. Unapproved change orders constitute claims in excess of agreed contract prices that we seek to collect from our clients (or other third parties) for delays, errors in specifications and designs, contract terminations, or other causes of unanticipated additional costs. Revenue on claims is recognized when contract costs related to claims have been incurred and when their addition to contract value can be reliably estimated. This can lead to a situation in which costs are recognized in one period and revenue is recognized in a subsequent period such as when client agreement is obtained or a claims resolution occurs. Total accounts receivable at December 27, 2015 and September 27, 2015 included approximately $39 million and $53 million, respectively, related to claims, including requests for equitable adjustment, on contracts that provide for price redetermination. During the first quarter of fiscal 2016 we collected $13.4 million to settle claims of $8.8 million, which resulted in gains in operating income of $4.6 million in the RCM reportable segment. W e regularly evaluate all unsettled claim amounts and record appropriate adjustments to operating earnings when it is probable that the claim will result in a different contract value than the amount previously estimated. In the first quarter of fiscal 2016, we also recognized reductions to operating income in our RCM segment and a related increase in the allowance for doubtful accounts of $7.9 million as a result of our updated assessment of the collectability of certain accounts receivable, of which $4.6 million related to unsettled claims. As a result of the assessment of claims in last year’s first quarter, we recognized revenue and an increase in operating income of $3.2 million related to claims with a federal government client. Billed accounts receivable related to U.S. federal government contracts were $ 58.0 million and $ 61.9 million at December 27, 2015 and September 27, 2015, respectively. U.S. federal government unbilled receivables were $ 62.3 million and $ 74.2 million at December 27, 2015 and September 27, 2015, respectively . Other than the U.S. federal government, no single client accounted for more than 10% of our accounts receivable at December 27, 2015 and September 27, 2015. We recognize revenue for most of our contracts using the percentage-of-completion method, primarily utilizing the cost-to-cost approach to estimate the progress towards completion in order to determine the amount of revenue and profit to recognize. Changes in those estimates could result in recognition of cumulative catch-up adjustments to the contract’s inception-to-date revenue, costs, and profit in the period in which such changes are made. As a result, we recognized immaterial net operating income adjustments during the first quarter of fiscal 2016 compared to net unfavorable operating income adjustments of $2.4 million in last year’s first quarter. Changes in revenue and cost estimates could also result in a projected loss that would be recorded immediately in earnings. As of December 27, 2015 and September 27, 2015, we recorded a liability for anticipated losses of $ 8.6 million and $10.5 million, respectively. The estimated cost to complete the related contracts as of December 27, 2015 was $ 47.7 million.

Mergers and Acquisitions

Mergers and Acquisitions	3 Months Ended
	Dec. 27, 2015
Mergers and Acquisitions
Mergers and Acquisitions	3. Mergers and Acquisitions We made no acquisitions in the first quarter of fiscal 2016. In fiscal 2015, we acquired Cornerstone Environmental Group, LLC (“CEG”), headquartered in Middletown, New York. CEG is an environmental engineering and consulting firm focused on solid waste markets in the United States, and is included in our RME segment. The fair value of the purchase price for CEG was $15.9 million. Of this amount, $11.8 million was paid to the sellers and $4.1 million was the estimated fair value of contingent earn-out obligations, with a maximum of $9.8 million, based upon the achievement of specified financial objectives. Goodwill additions resulting from business combinations are primarily attributable to the existing workforce of the acquired companies and the synergies expected to arise after the acquisitions. Specifically, the goodwill additions related to the fiscal 2015 acquisition primarily represents the value of a workforce with distinct expertise in the solid waste markets. In addition, these acquired capabilities, when combined with our existing global consulting and engineering business, result in opportunities that allow us to provide services under contracts that could not have been pursued individually by either us or the acquired company. The results of this acquisition were included in the consolidated financial statements from the closing date. The acquisition was not considered material to our condensed consolidated financial statements. As a result, no pro forma information has been provided. Most of our acquisition agreements include contingent earn-out agreements, which are generally based on the achievement of future operating income thresholds. The contingent earn-out arrangements are based on our valuations of the acquired companies, and reduce the risk of overpaying for acquisitions if the projected financial results are not achieved. The fair values of any earn-out arrangements are included as part of the purchase price of the acquired companies on their respective acquisition dates. For each transaction, we estimate the fair value of contingent earn-out payments as part of the initial purchase price and record the estimated fair value of contingent consideration as a liability in “Estimated contingent earn-out liabilities” and “Long-term estimated contingent earn-out liabilities” on the consolidated balance sheets. We consider several factors when determining that contingent earn-out liabilities are part of the purchase price, including the following: (1) the valuation of our acquisitions is not supported solely by the initial consideration paid, and the contingent earn-out formula is a critical and material component of the valuation approach to determining the purchase price; and (2) the former owners of acquired companies that remain as key employees receive compensation other than contingent earn-out payments at a reasonable level compared with the compensation of our other key employees. The contingent earn-out payments are not affected by employment termination. We measure our contingent earn-out liabilities at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy (as described in “Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the fiscal year ended September 27, 2015). We use a probability-weighted discounted income approach as a valuation technique to convert future estimated cash flows to a single present value amount. The significant unobservable inputs used in the fair value measurements are operating income projections over the earn-out period (generally two or three years), and the probability outcome percentages we assign to each scenario. Significant increases or decreases to either of these inputs in isolation would result in a significantly higher or lower liability, with a higher liability capped by the contractual maximum of the contingent earn-out obligation. Ultimately, the liability will be equivalent to the amount paid, and the difference between the fair value estimate and amount paid will be recorded in earnings. The amount paid that is less than or equal to the contingent earn-out liability on the acquisition date is reflected as cash used in financing activities in our consolidated statements of cash flows. Any amount paid in excess of the contingent earn-out liability on the acquisition date is reflected as cash used in operating activities. We review and re-assess the estimated fair value of contingent consideration on a quarterly basis, and the updated fair value could differ materially from the initial estimates. Changes in the estimated fair value of our contingent earn-out liabilities related to the time component of the present value calculation are reported in interest expense. Adjustments to the estimated fair value related to changes in all other unobservable inputs are reported in operating income. During the first quarter of fiscal 2016, we recorded an increase in our contingent earn-out liabilities and reported a related loss in operating income of $1.0 million. This loss represents the final cash settlement during the first quarter of fiscal 2016 of an earn-out liability that was valued at $0 at the end of fiscal 2015. We recorded no gains or losses related to changes in the estimated fair value of our contingent earn-out liabilities in the first quarter of fiscal 2015. At December 27, 2015, there was a total maximum of $25.6 million of outstanding contingent consideration related to acquisitions. Of this amount, $4.2 million was estimated as the fair value and accrued on our condensed consolidated balance sheet. Subsequent Event. On January 19, 2016, we announced that our off-market takeover bid for all of the outstanding shares of Coffey International Limited (“Coffey”) was free from all conditions required to close the purchase. The payment for the shares will occur in the second quarter of fiscal 2016, with a purchase price of approximately $76 million for 100% of the shares.

Goodwill and Intangible Assets

Goodwill and Intangible Assets	3 Months Ended
	Dec. 27, 2015
Goodwill and Intangible Assets
Goodwill and Intangible Assets	4. Goodwill and Intangible Assets The following table summarizes the changes in the carrying value of goodwill: WEI RME Total (in thousands) Balance at September 27, 2015 $ $ $ Goodwill adjustments – Foreign exchange impact Balance at December 27, 2015 $ $ $ We perform our annual goodwill impairment review at the beginning of our fiscal fourth quarter. Our most recent review was performed at June 29, 2015 (i.e. the first day of our fourth quarter in fiscal 2015). In addition, we regularly evaluate whether events and circumstances have occurred that may indicate a potential change in recoverability of goodwill. We perform interim goodwill impairment reviews between our annual reviews if certain events and circumstances have occurred, including a deterioration in general economic conditions; an increase in the competitive environment; a change in management, key personnel, strategy or customers; negative or declining cash flows; or a decline in actual or planned revenue or earnings compared with actual and projected results of relevant prior periods. We estimate the fair value of all reporting units with a goodwill balance based on a comparison and weighting of the income approach (weighted 70%), specifically the discounted cash flow method and the market approach (weighted 30%), which estimates the fair value of our reporting units based upon comparable market prices and recent transactions and also validates the reasonableness of the multiples from the income approach. The resulting fair value is most sensitive to the assumptions we use in our discounted cash flow analysis. The assumptions that have the most significant impact on the fair value calculation are the reporting unit’s revenue growth rate and operating profit margin, and the discount rate used to convert future estimated cash flows to a single present value amount. In the fourth quarter of fiscal 2015, we determined that our Waste Management Group (“WMG”) reporting unit in our RME segment had an estimated fair value that exceeded its carrying value by less than 20%. In our discounted cash flow model for WMG, we assumed annual revenue growth rates of 3% to 5% based on historical trends in WMG and the solid waste industry, projections for future solid waste activity, and WMG’s backlog and prospects for new orders. We discounted the resulting cash flows at a rate of 11.0%. Our market based assessment resulted in a value approximating a 1.0 multiple of revenue for the 12 month period preceding the valuation date. The discounted cash flow value, combined on a weighted-average basis with the results of our market analysis, resulted in an estimated fair value for WMG of $103.5 million compared to our carrying value including goodwill of $93.9 million. No changes occurred during the first quarter of fiscal 2016 that would significantly change these amounts. As of December 27, 2015, the goodwill amount for WMG was $56.5 million. Although we believe that our current estimate of fair value is reasonable, our analysis is primarily dependent on our future level of revenue from our solid waste clients. However, the extent of our future activity is uncertain. We currently anticipate that if WMG’s future revenue grows by less than 2.0%, or market prices for similar businesses decline by more than 10%, WMG’s goodwill could become impaired. Additionally, if the yield on 20-year U.S. treasury bonds (our assumed risk-free rate of return) or the additional return investors require for alternate investments, including those similar to WMG, increases, we may be required to increase the discount rate used in our cash flow analysis. If all of our operating assumptions remain constant, but we are required to increase the discount rate in our cash flow model to 14.0% or higher, WMG’s goodwill could become impaired. Foreign exchange impact relates to our foreign subsidiaries with functional currencies that are different than our reporting currency. The gross amounts of goodwill for WEI were $289.4 million and $293.1 million at December 27, 2015 and September 27, 2015, respectively, excluding $82.4 million of accumulated impairment. The gross amounts of goodwill for RME were $420.2 million and $423.8 million at December 27, 2015 and September 27, 2015, respectively, excluding $33.2 million of accumulated impairment. The gross amount and accumulated amortization of our acquired identifiable intangible assets with finite useful lives included in “Intangible assets - net” on the condensed consolidated balance sheets, were as follows: December 27, 2015 September 27, 2015 Weighted- Average Remaining Life (in Years) Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization ($ in thousands) Non-compete agreements 0.9 $ $ $ $ Client relations 3.3 Backlog 0.3 Technology and trade names 1.3 Total $ $ $ $ Foreign currency translation adjustments reduced net identifiable intangible assets by $ 0.4 million in the first quarter of fiscal 2016. Amortization expense for the identifiable intangible assets for the first quarters of fiscal 2016 and 2015 was $ 4.3 million and $5.9 million, respectively. Estimated amortization expense for the remainder of fiscal 2016 and succeeding years is as follows: Amount (in thousands) 2016 $ 2017 2018 2019 2020 Beyond Total $

Property and Equipment

Property and Equipment	3 Months Ended
	Dec. 27, 2015
Property and Equipment
Property and Equipment	5 . Property and Equipment P roperty and equipment consisted of the following: December 27, 2015 September 27, 2015 (in thousands) Land and buildings $ $ Equipment, furniture and fixtures Leasehold improvements Total property and equipment Accumulated depreciation Property and equipment, net $ $ The depreciation expense related to property and equipment , including assets under capital leases , was $5.3 million and $6.9 million for the first quarters of fiscal 2016 and 2015, respectively .

Stock Repurchase and Dividends

Stock Repurchase and Dividends	3 Months Ended
	Dec. 27, 2015
Stock Repurchase and Dividends.
Stock Repurchase and Dividends	6. Stock Repurchase and Dividends On November 10, 2014, the Board of Directors authorized a stock repurchase program under which we may repurchase up to $200 million of our common stock over the next two years. In the first quarter of fiscal 2016, we repurchased through open market purchases a total of 939,909 shares at an average price of $26.60, for a total cost of $25.0 million under this repurchase program. On November 9, 2015, the Board of Directors declared a quarterly cash dividend of $0.08 per share payable on December 11, 2015 to stockholders of record as of the close of business on November 30, 2015. Dividends totaling $4.7 million and $4.4 million were paid in the first quarters of fiscal 2016 and fiscal 2015, respectively. Subsequent Event. On January 25, 2016, the Board of Directors declared a quarterly cash dividend of $0.08 per share payable on February 26, 2016 to stockholders of record as of the close of business on February 12, 2016.

Stockholders' Equity and Stock

Stockholders' Equity and Stock Compensation Plans	3 Months Ended
	Dec. 27, 2015
Stockholders' Equity and Stock Compensation Plans
Stockholders' Equity and Stock Compensation Plans	7. Stockholders’ Equity and Stock Compensation Plans We recognize the fair value of our stock-based compensation awards as compensation expense on a straight-line basis over the requisite service period in which the award vests. Stock-based compensation expense for the first quarters of both fiscal 2016 and fiscal 2015 was $2.8 million. The majority of these amounts were included in “Selling, general and administrative (“SG&A”) expenses” in our condensed consolidated statements of income. In the first quarter of fiscal 2016, we granted 241,932 stock options with an exercise price of $27.16 per share and an estimated weighted-average fair value of $8.05 per share to our non-employee directors and executive officers. The executive officer options vest over a four-year period, and the non-employee director options vest after one year. In addition, we awarded 137,777 performance shares units (“PSUs”) to our non-employee directors and executive officers at the fair value of $31.63 per share on the award date. All of the PSUs are performance-based and vest, if at all, after the conclusion of the three-year performance period. The number of PSUs that ultimately vest is based 50% on the growth in our diluted earnings per share and 50% on our total shareholder return over the vesting period. Additionally, we awarded 215,539 restricted stock units (“RSUs”) to our non-employee directors, executive officers and employees at the fair value of $27.16 per share on the award date. All of the executive officer and employee RSUs have time-based vesting over a four-year period, and the non-employee director RSUs vest after one year.

Earnings Per Share ("EPS")

Earnings Per Share ("EPS")	3 Months Ended
	Dec. 27, 2015
Earnings Per Share ("EPS")
Earnings Per Share ("EPS")	8. Earnings Per Share (“EPS”) Basic EPS is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding, less unvested restricted stock for the period. Diluted EPS is computed by dividing net income by the weighted-average number of common shares outstanding and dilutive potential common shares for the period. Potential common shares include the weighted-average dilutive effects of outstanding stock options and unvested restricted stock using the treasury stock method. The following table sets forth the number of weighted-average shares used to compute basic and diluted EPS: Three Months Ended December 27, 2015 December 28, 2014 (in thousands, except per share data) Net income attributable to Tetra Tech $ $ Weighted-average common shares outstanding - basic Effect of dilutive stock options and unvested restricted stock Weighted-average common stock outstanding - diluted Earnings per share attributable to Tetra Tech: Basic $ $ Diluted $ $ For the first quarters of fiscal 2016 and 2015, 0.6 million and 0.8 million options, respectively, were excluded from the calculation of dilutive potential common shares because the assumed proceeds per share exceeded the average market price per share during the period. Therefore, their inclusion would have been anti-dilutive.

Income Taxes

Income Taxes	3 Months Ended
	Dec. 27, 2015
Income Taxes
Income Taxes	9. Income Taxes The effective tax rates for the first quarters of fiscal 2016 and 2015 were 25.7 % and 26.4%, respectively. During the first quarter of fiscal 2016, the Protecting Americans from Tax Hikes (“PATH”) Act of 2015 was signed into law. This law permanently extended the federal research and experimentation tax credits (“R&E Credits”) retroactive to January 1, 2015. Our income tax expense for the first quarter of fiscal 2016 included a tax benefit of $2.0 million attributable to operating income during the last nine months of fiscal 2015, primarily related to the retroactive recognition of the R&E Credits. Our income tax expense for the first quarter of fiscal 2015 included a similar retroactive tax benefit of $1.2 million attributable to operating income during the last nine months of fiscal 2014. At December 27, 2015, approximately $63.3 million of undistributed earnings of our foreign subsidiaries, primarily in Canada, are expected to be permanently reinvested. Accordingly, no provision for U.S. income taxes or foreign withholding taxes has been made. Upon distribution of those earnings, we would be subject to U.S. income taxes and foreign withholding taxes. Assuming the permanently reinvested foreign earnings were repatriated under the laws and rates applicable at December 27, 2015, the incremental federal tax applicable to those earnings would be approximately $5.4 million. We review the realizability of deferred tax assets on a quarterly basis by assessing the need for a valuation allowance. As of December 27, 2015, we performed our assessment of net deferred tax assets. Significant management judgment is required in determining the provision for income taxes and, in particular, any valuation allowance recorded against our deferred tax assets. Applying the applicable accounting guidance requires an assessment of all available evidence, both positive and negative, regarding the realizability of the net deferred tax assets. Based upon recent results, we concluded that a cumulative loss in recent years exists in certain foreign jurisdictions. We have historically relied on the following factors in our assessment of the realizability of our net deferred tax assets: · taxable income in prior carryback years as permitted under the tax law; · future reversals of existing taxable temporary differences; · consideration of available tax planning strategies and actions that could be implemented, if necessary; and · estimates of future taxable income from our operations. We considered these factors in our estimate of the reversal pattern of deferred tax assets, using assumptions that we believe are reasonable and consistent with operating results. However, as a result of projected cumulative pre-tax losses in certain foreign jurisdictions for the 36 months ending December 30, 2018, we concluded that our estimates of future taxable income and certain tax planning strategies did not constitute sufficient positive evidence to assert that it is more likely than not that certain deferred tax assets would be realizable before expiration. Based on our assessment, we have concluded that it is more likely than not that the assets will be realized except for the assets related to loss carry-forwards in foreign jurisdictions for which a valuation allowance of $8.3 million has been provided in prior years.

Reportable Segments

Reportable Segments	3 Months Ended
	Dec. 27, 2015
Reportable Segments
Reportable Segments	10. Reportable Segments Our reportable segments are described as follows: WEI: WEI provides consulting and engineering services worldwide for a broad range of water and infrastructure-related needs in both developed and emerging economies. WEI supports both public and private clients including federal, state/provincial, and local governments, and global and local commercial and industrial clients. The primary markets for WEI’s services include water resources analysis and water management, environmental restoration, government consulting, and a broad range of civil infrastructure master planning and engineering design for facilities, transportation, and regional and local development. WEI’s services span from early data collection and monitoring, to data analysis and information technology, to science and engineering applied research, to engineering design, to construction management and operations and maintenance. RME: RME provides consulting and engineering services worldwide for a broad range of resource management and energy needs. RME supports both private and public clients, including global industrial and commercial clients, U.S. federal agencies in large scale remediation, and major international development agencies. The primary markets for RME’s services include natural resources, energy, remediation, waste management, utilities and international development. RME’s services span from early data collection and monitoring, to data analysis and information technology, to science and engineering applied research, to engineering design, to construction management and operations and maintenance. RME supports engineering, procurement and construction management for full service implementation of commercial projects. RCM: We report the results of the wind-down of our non-core construction activities in the RCM reportable segment. The remaining work performed in this segment will be substantially complete by the end of fiscal 2016. Management evaluates the performance of these reportable segments based upon their respective segment operating income before the effect of amortization expense related to acquisitions and other unallocated corporate expenses. We account for inter-segment sales and transfers as if the sales and transfers were to third parties; that is, by applying a negotiated fee onto the costs of the services performed. All significant intercompany balances and transactions are eliminated in consolidation. The following tables set forth summarized financial information regarding our reportable segments: Reportable Segments Three Months Ended December 27, 2015 December 28, 2014 (in thousands) Revenue WEI $ $ RME RCM Elimination of inter-segment revenue Total revenue $ $ Operating Income (Loss) WEI $ $ RME RCM Corporate (1) Total operating income $ $ Depreciation WEI $ $ RME RCM Corporate Total depreciation $ $ (1) Includes amortization of intangibles, other costs, and other income not allocable to our reportable segments. December 27, 2015 September 27, 2015 (in thousands) Total Assets WEI $ $ RME RCM Corporate (1) Total assets $ $ (1) Corporate assets consist of intercompany eliminations and assets not allocated to our reportable segments including goodwill, intangible assets, deferred income taxes and certain other assets. Major Clients Other than the U.S. federal government, no single client accounted for more than 10% of our revenue. All of our segments generated revenue from all client sectors. The following table represents our revenue by client sector: Three Months Ended December 27, 2015 December 28, 2014 (in thousands) Client Sector International (1) $ $ U.S. commercial U.S. federal government (2) U.S. state and local government Total $ $ (1) Includes revenue generated from foreign operations, primarily in Canada, and revenue generated from non-U.S. clients. (2) Includes revenue generated under U.S. federal government contracts performed outside the United States.

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Dec. 27, 2015
Fair Value Measurements
Fair Value Measurements	11. Fair Value Measurements The fair value of long-term debt was determined using the present value of future cash flows based on the borrowing rates currently available for debt with similar terms and maturities (Level 2 measurement, as described in “Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the fiscal year ended September 27, 2015). The carrying value of our long-term debt approximated fair value at December 27, 2015 and September 27, 2015. As of December 27, 2015, we had borrowings of $189.6 million outstanding under our amended credit agreement, which were used to fund our business acquisitions, working capital needs, and contingent earn-outs.

Joint Ventures

Joint Ventures	3 Months Ended
	Dec. 27, 2015
Joint Ventures
Joint Ventures	12. Joint Ventures Consolidated Joint Ventures The aggregate revenue of our consolidated joint ventures was $0.5 million and $2.2 million for the first quarters of fiscal 2016 and 2015, respectively. The assets and liabilities of these consolidated joint ventures were immaterial at December 27, 2015 and September 27, 2015. These assets are restricted for use only by those joint ventures and are not available for our general operations. Cash and cash equivalents maintained by the consolidated joint ventures at December 27, 2015 and September 27, 2015 were $0.5 million and $0.7 million, respectively. Unconsolidated Joint Ventures We account for our unconsolidated joint ventures using the equity method of accounting. Under this method, we recognize our proportionate share of the net earnings of these joint ventures within “Other costs of revenue” in our condensed consolidated statements of income. For the first quarters of fiscal 2016 and 2015, we reported $ 0.2 million and $0.7 million of equity in earnings of unconsolidated joint ventures, respectively. Our maximum exposure to loss as a result of our investments in unconsolidated joint ventures is typically limited to the aggregate of the carrying value of the investment. Future funding commitments for our unconsolidated joint ventures are immaterial. The unconsolidated joint ventures are, individually and in the aggregate, immaterial to our condensed consolidated financial statements. The aggregate carrying values of the assets and liabilities of the unconsolidated joint ventures were $ 13.7 million and $ 11.9 million, respectively, at December 27, 2015, and $ 17.1 million and $15.2 million, respectively, at September 27, 2015.

Derivative Financial Instrument

Derivative Financial Instruments	3 Months Ended
	Dec. 27, 2015
Derivative Financial Instruments
Derivative Financial Instruments	13. Derivative Financial Instruments We use certain interest rate derivative contracts to hedge interest rate exposures on our variable rate debt. We enter into foreign currency derivative contracts with financial institutions to reduce the risk that cash flows and earnings will be adversely affected by foreign currency exchange rate fluctuations. Our hedging program is not designated for trading or speculative purposes. We recognize derivative instruments as either assets or liabilities on the accompanying condensed consolidated balance sheets at fair value (Level 2 measurement, as described in “Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the fiscal year ended September 27, 2015). We record changes in the fair value (i.e., gains or losses) of the derivatives that have been designated as accounting hedges in our condensed consolidated balance sheets as accumulated other comprehensive loss. In fiscal 2013, we entered into three interest rate swap agreements that we designated as cash flow hedges to fix the variable interest rates on a portion of borrowings under our term loan facility. In the first quarter of fiscal 2014, we entered into two interest rate swap agreements that we designated as cash flow hedges to fix the variable interest rates on the borrowings under the term loan facility. At December 27, 2015, the effective portion of our interest rate swap agreements designated as cash flow hedges before tax effect was $ 1.2 million, all of which we expect to be reclassified from accumulated other comprehensive loss to interest expense within the next 12 months. As of December 27, 2015, the total notional principal amount of our outstanding interest rate swap agreements which expire in May 2018 was $189.6 million and the weighted average fixed interest rate was 1.32%. The fair values of our outstanding derivatives designated as hedging instruments were as follows: Balance Sheet Location December 27, 2015 September 27, 2015 (in thousands) Interest rate swap agreements Other current liabilities $ $ The impact of the effective portions of derivative instruments in cash flow hedging relationships on income and other comprehensive income from our foreign currency forward contracts and interest rate swap agreements was immaterial for the first three months of fiscal 2016 and the fiscal year ended September 27, 2015. Additionally, there were no ineffective portions of derivative instruments. Accordingly, no amounts were excluded from effectiveness testing for our foreign currency forward contracts and interest rate swap agreements. We had no derivative instruments that were not designated as hedging instruments for fiscal 2015 and the first quarter of fiscal 2016.

Reclassifications Out of Accumu

Reclassifications Out of Accumulated Other Comprehensive Loss	3 Months Ended
	Dec. 27, 2015
Reclassifications Out of Accumulated Other Comprehensive Loss
Reclassifications Out of Accumulated Other Comprehensive Loss	14. Reclassifications Out of Accumulated Other Comprehensive Loss The accumulated balances and reporting period activities for the three months ended December 27, 2015 and December 28, 2014 related to reclassifications out of accumulated other comprehensive loss are summarized as follows: Foreign Currency Translation Adjustments Loss on Derivative Instruments Accumulated Other Comprehensive Loss (in thousands) Balances at September 28, 2014 $ $ $ Other comprehensive income (loss) before reclassifications Reclassification adjustment of prior derivative settlement, net of tax – Net current-period other comprehensive loss Balances at December 28, 2014 $ $ $ Balances at September 27, 2015 $ $ $ Other comprehensive income (loss) before reclassifications Reclassification adjustment of prior derivative settlement, net of tax – Net current-period other comprehensive income (loss) Balances at December 27, 2015 $ $ $

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Dec. 27, 2015
Commitments and Contingencies
Commitments and Contingencies	15. Commitments and Contingencies We are subject to certain claims and lawsuits typically filed against the engineering, consulting and construction profession, alleging primarily professional errors or omissions. We carry professional liability insurance, subject to certain deductibles and policy limits, against such claims. However, in some actions, parties are seeking damages that exceed our insurance coverage or for which we are not insured. While management does not believe that the resolution of these claims will have a material adverse effect, individually or in aggregate, on our financial position, results of operations or cash flows, management acknowledges the uncertainty surrounding the ultimate resolution of these matters.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	3 Months Ended
	Dec. 27, 2015
Recent Accounting Pronouncements
Recent Accounting Pronouncements	16. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting standard that will supersede existing revenue recognition guidance under current U.S. GAAP. The new standard is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods and services. The accounting standard is effective for us in the first quarter of fiscal year 2019. Companies may use either a full retrospective or a modified retrospective approach to adopt this standard, and management is currently evaluating which transition approach to use. We are currently assessing what impact this new standard may have on our consolidated financial statements. In June 2014, the FASB issued updated guidance intended to eliminate the diversity in practice regarding share-based payment awards that include terms which provide for a performance target that affects vesting being achieved after the requisite service period. The new standard requires that a performance target which affects vesting and could be achieved after the requisite service period be treated as a performance condition that affects vesting and should not be reflected in estimating the grant-date fair value. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have an impact on our consolidated financial statements. In January 2015, the FASB issued an amendment to the accounting guidance related to the income statement presentation of extraordinary and unusual items. The amendment eliminates from U.S. GAAP the concept of extraordinary items. The guidance is effective for us in the first quarter of fiscal 2017. We do not expect the adoption of this guidance to have an impact on our consolidated financial statements. In February 2015, the FASB issued updated guidance which changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have an impact on our consolidated financial statements. In April 2015, the FASB issued updated guidance intended to simplify, and provide consistency to, the presentation of debt issuance costs. The new standard requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In August 2015, the FASB issued updated guidance relating to the SEC Staff Announcement at the June 18, 2015 Emerging Issues Task Force meeting on the presentation and subsequent measurement of debt issuance costs associated with line-of-credit arrangements. The updated guidance allows for the deferral and presentation of debt issuance costs as an asset which may be amortized ratably over the term of the line-of-credit arrangement, regardless of whether there are any related outstanding borrowings. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In September 2015, the FASB issued updated guidance to simplify measurement-period adjustments in business combinations. The updated guidance eliminated the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Instead, an acquirer will recognize a measurement-period adjustment during the period in which it determines the amount of the adjustment. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements. In November 2015, the FASB issued updated guidance as a part of its ongoing Simplification Initiative, with the objective of reducing complexity in accounting standards. The updated guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. This guidance does not change the offsetting requirements for deferred tax liabilities and assets, which results in the presentation of one amount on the balance sheet. The guidance is effective for interim and annual reporting periods beginning December 15, 2016, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

Accounts Receivable - Net (Tabl

Accounts Receivable - Net (Tables)	3 Months Ended
	Dec. 27, 2015
Accounts Receivable - Net
Net accounts receivable and billings in excess of costs on uncompleted contracts	December 27, 2015 September 27, 2015 (in thousands) Billed $ $ Unbilled Contract retentions Total accounts receivable – gross Allowance for doubtful accounts Total accounts receivable – net $ $ Billings in excess of costs on uncompleted contracts $ $

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	3 Months Ended
	Dec. 27, 2015
Goodwill and Intangible Assets
Summary of changes in the carrying value of goodwill	WEI RME Total (in thousands) Balance at September 27, 2015 $ $ $ Goodwill adjustments – Foreign exchange impact Balance at December 27, 2015 $ $ $
Summary of acquired identifiable intangible assets with finite useful lives	December 27, 2015 September 27, 2015 Weighted- Average Remaining Life (in Years) Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization ($ in thousands) Non-compete agreements 0.9 $ $ $ $ Client relations 3.3 Backlog 0.3 Technology and trade names 1.3 Total $ $ $ $
Estimated amortization expense for the succeeding five years and beyond	Amount (in thousands) 2016 $ 2017 2018 2019 2020 Beyond Total $

Property and Equipment (Tables)

Property and Equipment (Tables)	3 Months Ended
	Dec. 27, 2015
Property and Equipment
Schedule of components of property and equipment	December 27, 2015 September 27, 2015 (in thousands) Land and buildings $ $ Equipment, furniture and fixtures Leasehold improvements Total property and equipment Accumulated depreciation Property and equipment, net $ $

Earnings Per Share ("EPS") (Tab

Earnings Per Share ("EPS") (Tables)	3 Months Ended
	Dec. 27, 2015
Earnings Per Share ("EPS")
Schedule of number of weighted-average shares used to compute basic and diluted EPS	Three Months Ended December 27, 2015 December 28, 2014 (in thousands, except per share data) Net income attributable to Tetra Tech $ $ Weighted-average common shares outstanding - basic Effect of dilutive stock options and unvested restricted stock Weighted-average common stock outstanding - diluted Earnings per share attributable to Tetra Tech: Basic $ $ Diluted $ $

Reportable Segments (Tables)

Reportable Segments (Tables)	3 Months Ended
	Dec. 27, 2015
Reportable Segments
Summarized financial information of reportable segments	Three Months Ended December 27, 2015 December 28, 2014 (in thousands) Revenue WEI $ $ RME RCM Elimination of inter-segment revenue Total revenue $ $ Operating Income (Loss) WEI $ $ RME RCM Corporate (1) Total operating income $ $ Depreciation WEI $ $ RME RCM Corporate Total depreciation $ $ (1) Includes amortization of intangibles, other costs, and other income not allocable to our reportable segments. December 27, 2015 September 27, 2015 (in thousands) Total Assets WEI $ $ RME RCM Corporate (1) Total assets $ $ (1) Corporate assets consist of intercompany eliminations and assets not allocated to our reportable segments including goodwill, intangible assets, deferred income taxes and certain other assets.
Summary of revenue by client sector	Three Months Ended December 27, 2015 December 28, 2014 (in thousands) Client Sector International (1) $ $ U.S. commercial U.S. federal government (2) U.S. state and local government Total $ $ (1) Includes revenue generated from foreign operations, primarily in Canada, and revenue generated from non-U.S. clients. (2) Includes revenue generated under U.S. federal government contracts performed outside the United States.

Derivative Financial Instrume29

Derivative Financial Instruments (Tables)	3 Months Ended
	Dec. 27, 2015
Derivative Financial Instruments
Schedule of fair values of the entity's outstanding derivatives designated as hedging instruments	Balance Sheet Location December 27, 2015 September 27, 2015 (in thousands) Interest rate swap agreements Other current liabilities $ $

Reclassifications Out of Accu30

Reclassifications Out of Accumulated Other Comprehensive Loss (Tables)	3 Months Ended
	Dec. 27, 2015
Reclassifications Out of Accumulated Other Comprehensive Loss
Summary of reclassifications out of accumulated other comprehensive loss	Foreign Currency Translation Adjustments Loss on Derivative Instruments Accumulated Other Comprehensive Loss (in thousands) Balances at September 28, 2014 $ $ $ Other comprehensive income (loss) before reclassifications Reclassification adjustment of prior derivative settlement, net of tax – Net current-period other comprehensive loss Balances at December 28, 2014 $ $ $ Balances at September 27, 2015 $ $ $ Other comprehensive income (loss) before reclassifications Reclassification adjustment of prior derivative settlement, net of tax – Net current-period other comprehensive income (loss) Balances at December 27, 2015 $ $ $

Accounts Receivable - Net (Deta

Accounts Receivable - Net (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Dec. 27, 2015USD ($)item	Dec. 28, 2014USD ($)	Sep. 27, 2015USD ($)item
Accounts Receivable, Net
Billed	$ 335,873		$ 331,364
Unbilled	271,578		311,823
Contract retentions	24,221		24,333
Total accounts receivable - gross	631,672		667,520
Allowance for doubtful accounts	(37,704)		(31,490)
Total accounts receivable - net	593,968		636,030
Billings in excess of costs on uncompleted contracts	$ 96,188		93,989
Period for billing and collecting unbilled receivables	12 months
Period for earning majority of billings in excess of costs	12 months
Total accounts receivable related to claims and requests for equitable adjustment on contracts	$ 39,000		53,000
Revenue recognized related to the evaluation of claim amounts		$ 3,200
Increase in operating income related to the evaluation of claim amounts		3,200
Billed accounts receivable related to U.S. federal government contracts	58,000		61,900
U.S. federal government unbilled receivables	$ 62,300		$ 74,200
Threshold percentage for disclosure of accounts receivable from a single client	10.00%		10.00%
Revenue Recognition and Contract Costs
Net unfavorable operating income adjustments		$ 2,400
Liability for anticipated losses	$ 8,600		$ 10,500
Estimated cost to complete the related contracts	$ 47,700
Accounts Receivable
Account receivable major customer
Number of clients exceeding threshold | item	0		0
RCM
Accounts Receivable, Net
Cash proceeds from claim settlement	$ 13,400
Claims amount	8,800
Gain from claim settlement	4,600
Increase in allowance for doubtful accounts	7,900
Decrease in operating income related to the increase in allowance for doubtful accounts	7,900
Collectability of certain accounts receivable	$ 4,600

Mergers and Acquisitions (Detai

Mergers and Acquisitions (Details) $ in Thousands	Jan. 19, 2016USD ($)	Dec. 27, 2015USD ($)item	Dec. 28, 2014USD ($)	Sep. 27, 2015USD ($)
Business acquisition
Number of acquisitions | item		0
Contingent earn-out liability		$ 4,200
Aggregate maximum of contingent consideration		25,600
Increase (Decrease) in contingent consideration		1,000
Contingent consideration liability				$ 0
Gain (loss) on change in contingent consideration		$ (1,000)	$ 0
Maximum
Business acquisition
Earn-out period for operating income projection		3 years
Minimum
Business acquisition
Earn-out period for operating income projection		2 years
CEG
Business acquisition
Aggregate fair value of purchase prices				15,900
Cash paid to the sellers				11,800
Contingent earn-out liability				4,100
Aggregate maximum of contingent consideration				$ 9,800
Coffey | BIA | Subsequent Event
Business acquisition
Aggregate fair value of purchase prices	$ 76,000
Ownership interest acquired	100.00%

Goodwill and Intangible Asset33

Goodwill and Intangible Assets Goodwill (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Sep. 27, 2015
Goodwill
Balance at beginning of the period	$ 601,379
Goodwill adjustments	2,000
Foreign exchange impact	(9,375)
Balance at end of the period	594,004
WEI
Goodwill
Balance at beginning of the period	210,748
Foreign exchange impact	(3,750)
Balance at end of the period	206,998
Gross amounts of goodwill	289,400	$ 293,100
Accumulated impairment	82,400	82,400
RME
Goodwill
Balance at beginning of the period	390,631
Goodwill adjustments	2,000
Foreign exchange impact	(5,625)
Balance at end of the period	387,006
Gross amounts of goodwill	420,200	423,800
Accumulated impairment	$ 33,200	$ 33,200

Goodwill and Intangible Asset34

Goodwill and Intangible Assets Valuation Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Sep. 27, 2015
Goodwill	$ 594,004	$ 601,379
RME
Goodwill	387,006	$ 390,631
RME | WMG
Fair value of business	103,500
Carrying value of business	93,900
Goodwill	$ 56,500
RME | WMG | US treasury bonds
Impairment of goodwill
Maturity of investments whose yield is considered in determination of impairment	20 years
RME | WMG | Maximum
Percentage of excess of fair value over carrying value		20.00%
Goodwill. | RME | WMG
Discounted cash flow rate (as a percent)	11.00%
Revenue multiple	1
Preceding period used for revenue multiple	12 months
Impairment of goodwill
Maximum percentage of revenue growth that could indicate goodwill impairment	2.00%
Minimum decline in future market prices of similar businesses that could indicate goodwill impairment	10.00%
Minimum discounted cash flow rate (as a percent)	14.00%
Goodwill. | RME | WMG | Minimum
Annual revenue growth rate (as a percent)	3.00%
Goodwill. | RME | WMG | Maximum
Annual revenue growth rate (as a percent)	5.00%
Income approach
Weighted rate used in fair value of goodwill (as a percent)	70.00%
Discounted cash flow and market approach
Weighted rate used in fair value of goodwill (as a percent)	30.00%

Goodwill and Intangible Asset35

Goodwill and Intangible Assets Finite Lived Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Sep. 27, 2015
Finite-lived intangible assets
Gross Amount	$ 110,321		$ 112,116
Accumulated Amortization	(74,658)		(71,784)
Foreign currency translation adjustments	400
Amortization expense for identifiable intangible assets	4,300	$ 5,900
Estimated amortization expense
2,016	10,827
2,017	12,525
2,018	5,843
2,019	2,989
2,020	2,418
Beyond	1,061
Total	$ 35,663
Non-compete agreements
Finite-lived intangible assets
Weighted-Average Remaining Life	10 months 24 days
Gross Amount	$ 811		819
Accumulated Amortization	$ (629)		(587)
Client relations
Finite-lived intangible assets
Weighted-Average Remaining Life	3 years 3 months 18 days
Gross Amount	$ 104,988		106,676
Accumulated Amortization	$ (70,224)		(67,726)
Backlog
Finite-lived intangible assets
Weighted-Average Remaining Life	3 months 18 days
Gross Amount	$ 2,093		2,115
Accumulated Amortization	$ (1,710)		(1,444)
Technology and trade names
Finite-lived intangible assets
Weighted-Average Remaining Life	1 year 3 months 18 days
Gross Amount	$ 2,429		2,506
Accumulated Amortization	$ (2,095)		$ (2,027)

Property and Equipment (Details

Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Sep. 27, 2015
Property and Equipment
Property and equipment at cost, gross	$ 201,360		$ 202,126
Accumulated depreciation	(140,065)		(137,220)
Property and equipment, net	61,295		64,906
Depreciation expense related to property and equipment, including assets under capital leases	5,303	$ 6,864
Land and buildings
Property and Equipment
Property and equipment at cost, gross	3,660		3,661
Equipment, furniture and fixtures
Property and Equipment
Property and equipment at cost, gross	175,951		176,883
Leasehold improvements
Property and Equipment
Property and equipment at cost, gross	$ 21,749		$ 21,582

Stock Repurchase and Dividends

Stock Repurchase and Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands	Jan. 25, 2016	Nov. 09, 2015	Nov. 10, 2014	Dec. 27, 2015	Dec. 28, 2014
Maximum repurchase amount under stock repurchase program			$ 200,000
Period of stock repurchase program			2 years
Shares repurchased through open market purchases				939,909
Average price of shares repurchased (in dollars per share)				$ 26.60
Cost of shares repurchased				$ 25,000
Quarterly cash dividend declared (in dollars per share)		$ 0.08
Payment of dividends				$ 4,713	$ 4,372
Subsequent Event
Quarterly cash dividend declared (in dollars per share)	$ 0.08

Stockholders' Equity and Stoc38

Stockholders' Equity and Stock Compensation Plans (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Stockholders' Equity and Stock Compensation Plans
Stock-based compensation expense	$ 2.8	$ 2.8
Options granted (in shares)	241,932
Restricted stock award
Exercise price of stock options granted (in dollars per share)	$ 27.16
Non-employee directors and executive officers
Restricted stock award
Weighted-average fair value of stock options granted (in dollars per share)	$ 8.05
Executive officers
Restricted stock award
Vesting period	4 years
Non-employee director
Restricted stock award
Vesting period	1 year
Executive officers and employees
Restricted stock award
Vesting period	4 years
Performance-based restricted stock
Restricted stock award
Percentage of shares that ultimately vest depending on fiscal year earnings per share growth rates	50.00%
Percentage of shares that ultimately vest depending on fiscal year shareholder vesting period	50.00%
Performance-based restricted stock | Non-employee directors and executive officers
Restricted stock award
Granted (in shares)	137,777
Granted, fair value (in dollars per share)	$ 31.63
Vesting period	3 years
Time-based restricted stock | Non-employee directors, executive officers and employees
Restricted stock award
Granted (in shares)	215,539
Granted, fair value (in dollars per share)	$ 27.16

Earnings Per Share (''EPS'') (D

Earnings Per Share (''EPS'') (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Number of weighted-average shares used to compute basic and diluted EPS:
Net income attributable to Tetra Tech	$ 23,239	$ 25,575
Weighted-average common shares outstanding - basic	59,058	62,452
Effect of diluted stock options and unvested restricted stock	735	660
Weighted-average common stock outstanding - diluted	59,793	63,112
Earnings per share attributable to Tetra Tech:
Basic (in dollars per share)	$ 0.39	$ 0.41
Diluted (in dollars per share)	$ 0.39	$ 0.41
Stock options
Antidilutive securities
Securities excluded from the calculation of dilutive potential common shares	600	800

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Income Taxes
Effective tax rate (as a percent)	25.70%	26.40%
R&E credits	$ 2	$ 1.2
Undistributed earnings of foreign subsidiaries	63.3
Incremental federal tax due to repatriation of foreign earnings	$ 5.4
Represents the period of projected cumulative pre-tax losses in certain foreign jurisdictions	36 months
Loss carry-forwards in foreign jurisdictions, valuation allowance	$ 8.3

Reportable Segments Financial I

Reportable Segments Financial Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Sep. 27, 2015
Financial information concerning reportable segments
Revenue	$ 560,708	$ 581,056
Operating income (loss)	32,930	36,612
Depreciation	5,303	6,864
Total assets	1,527,494		$ 1,559,242
Inter-segment elimination
Financial information concerning reportable segments
Revenue	(16,218)	(17,447)
Corporate
Financial information concerning reportable segments
Operating income (loss)	(7,261)	(7,520)
Depreciation	409	1,293
Corporate
Financial information concerning reportable segments
Total assets	807,757		792,385
WEI | Operating segment
Financial information concerning reportable segments
Revenue	240,383	247,797
Operating income (loss)	20,030	21,513
Depreciation	1,168	1,377
Total assets	278,370		287,112
RME | Operating segment
Financial information concerning reportable segments
Revenue	315,717	316,276
Operating income (loss)	25,443	26,039
Depreciation	3,533	3,534
Total assets	395,617		422,133
RCM | Operating segment
Financial information concerning reportable segments
Revenue	20,826	34,430
Operating income (loss)	(5,282)	(3,420)
Depreciation	193	$ 660
Total assets	$ 45,750		$ 57,612

Reportable Segments Revenue By

Reportable Segments Revenue By Sector (Details) $ in Thousands	3 Months Ended
	Dec. 27, 2015USD ($)item	Dec. 28, 2014USD ($)
Revenue by client sector
Threshold percentage for disclosure of revenue from a single client	10.00%
Revenue	$ 560,708	$ 581,056
Revenue
Revenue by client sector
Number of clients exceeding threshold | item	0
International
Revenue by client sector
Revenue	$ 135,807	147,061
U.S. commercial
Revenue by client sector
Revenue	188,164	173,658
U.S. federal government
Revenue by client sector
Revenue	165,022	185,711
U.S. state and local government
Revenue by client sector
Revenue	$ 71,715	$ 74,626

Fair Value Measurements (Detail

Fair Value Measurements (Details) $ in Millions	Dec. 27, 2015USD ($)
Fair Value Measurements
Outstanding borrowings under the amended credit agreement	$ 189.6

Joint Ventures (Details)

Joint Ventures (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Sep. 27, 2015
Aggregate revenue of consolidated joint ventures	$ 560,708	$ 581,056
Unconsolidated Joint Ventures
Equity in earnings from unconsolidated joint ventures	202	650
Carrying value of assets of unconsolidated joint ventures	13,700		$ 17,100
Carrying value of liabilities of unconsolidated joint ventures	11,900		15,200
Consolidated Joint Ventures
Aggregate revenue of consolidated joint ventures	500	$ 2,200
Cash and cash equivalents of consolidated joint ventures	$ 500		$ 700

Derivative Financial Instrume45

Derivative Financial Instruments General Information (Details) $ in Millions	3 Months Ended		12 Months Ended
	Dec. 27, 2015USD ($)item	Dec. 29, 2013item	Sep. 27, 2015USD ($)item	Sep. 29, 2013item
Derivative financial instruments
Notional Amount	$ 189.6
Weighted average fixed rate	1.32%
Not designated as hedging instruments
Derivative financial instruments
Number of derivative instruments | item	0		0
Interest rate swap agreements | Derivatives designated as hedging instruments
Derivative financial instruments
Amounts excluded from effectiveness testing	$ 0		$ 0
Interest rate swap agreements | Designated as cash flow hedges | Derivatives designated as hedging instruments
Derivative financial instruments
Number of derivative agreements | item		2		3
Amount of effective portion of derivatives before tax effect	$ 1.2
Period of reclassification from accumulated other comprehensive loss to interest expense	12 months

Derivative Financial Instrume46

Derivative Financial Instruments Table (Details) - USD ($) $ in Thousands	Dec. 27, 2015	Sep. 27, 2015
Interest rate swap agreements | Derivatives designated as hedging instruments | Designated as cash flow hedges | Other current liabilities
Derivative financial instruments
Derivative liabilities, Fair Value of Derivative Instruments	$ 1,385	$ 2,518

Reclassifications Out of Accu47

Reclassifications Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 27, 2015	Dec. 28, 2014
Reclassifications out of accumulated other comprehensive income (loss)
Balances at the beginning of the period	$ (143,171)
Balances at the end of the period	(158,545)
Foreign Currency Translation Adjustments
Reclassifications out of accumulated other comprehensive income (loss)
Balances at the beginning of the period	(141,229)	$ (43,085)
Other comprehensive income (loss) before reclassifications	(16,484)	(24,569)
Net current-period other comprehensive loss	(16,484)	(24,569)
Balances at the end of the period	(157,713)	(67,654)
Loss on Derivative Instruments
Reclassifications out of accumulated other comprehensive income (loss)
Balances at the beginning of the period	(1,942)	547
Other comprehensive income (loss) before reclassifications	1,671	111
Net current-period other comprehensive loss	1,110	(480)
Balances at the end of the period	(832)	67
Loss on Derivative Instruments | Foreign exchange contracts
Reclassifications out of accumulated other comprehensive income (loss)
Reclassification adjustment of prior derivative settlement, net of tax	(561)	(591)
Accumulated Other Comprehensive Income (Loss)
Reclassifications out of accumulated other comprehensive income (loss)
Balances at the beginning of the period	(143,171)	(42,538)
Other comprehensive income (loss) before reclassifications	(14,813)	(24,458)
Net current-period other comprehensive loss	(15,374)	(25,049)
Balances at the end of the period	(158,545)	(67,587)
Accumulated Other Comprehensive Income (Loss) | Foreign exchange contracts
Reclassifications out of accumulated other comprehensive income (loss)
Reclassification adjustment of prior derivative settlement, net of tax	$ (561)	$ (591)