Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2018 | Aug. 01, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | AECOM | |
Entity Central Index Key | 868,857 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 160,780,324 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 628,321 | $ 665,871 |
Cash in consolidated joint ventures | 173,098 | 136,491 |
Total cash and cash equivalents | 801,419 | 802,362 |
Accounts receivable-net | 5,447,985 | 5,127,743 |
Prepaid expenses and other current assets | 651,816 | 696,718 |
Current assets held for sale | 63,303 | |
Income taxes receivable | 79,319 | 55,399 |
TOTAL CURRENT ASSETS | 7,043,842 | 6,682,222 |
PROPERTY AND EQUIPMENT-NET | 607,151 | 621,357 |
DEFERRED TAX ASSETS-NET | 181,564 | 171,331 |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 398,134 | 364,223 |
GOODWILL | 5,928,029 | 5,992,881 |
INTANGIBLE ASSETS-NET | 343,185 | 415,096 |
OTHER NON-CURRENT ASSETS | 225,512 | 149,846 |
TOTAL ASSETS | 14,727,417 | 14,396,956 |
CURRENT LIABILITIES: | ||
Short-term debt | 47,402 | 1,221 |
Accounts payable | 2,517,234 | 2,249,872 |
Accrued expenses and other current liabilities | 2,184,672 | 2,245,519 |
Income taxes payable | 28,493 | 38,176 |
Billings in excess of costs on uncompleted contracts | 968,778 | 902,812 |
Current liabilities held for sale | 17,914 | |
Current portion of long-term debt | 125,577 | 140,779 |
TOTAL CURRENT LIABILITIES | 5,890,070 | 5,578,379 |
OTHER LONG-TERM LIABILITIES | 340,116 | 322,199 |
DEFERRED TAX LIABILITY-NET | 14,354 | 20,515 |
PENSION BENEFIT OBLIGATIONS | 515,450 | 559,068 |
LONG-TERM DEBT | 3,707,293 | 3,702,109 |
TOTAL LIABILITIES | 10,467,283 | 10,182,270 |
COMMITMENTS AND CONTINGENCIES (Note 14) | ||
AECOM STOCKHOLDERS' EQUITY: | ||
Common stock-authorized, 300,000,000 shares of $0.01 par value as of June 30, 2018 and September 30, 2017; issued and outstanding 160,693,918 and 157,529,419 shares as of June 30, 2018 and September 30, 2017, respectively | 1,607 | 1,575 |
Additional paid-in capital | 3,820,281 | 3,733,572 |
Accumulated other comprehensive loss | (758,287) | (700,661) |
Retained earnings | 1,014,131 | 961,640 |
TOTAL AECOM STOCKHOLDERS' EQUITY | 4,077,732 | 3,996,126 |
Noncontrolling interests | 182,402 | 218,560 |
TOTAL STOCKHOLDERS' EQUITY | 4,260,134 | 4,214,686 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 14,727,417 | $ 14,396,956 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2018 | Sep. 30, 2017 |
Consolidated Balance Sheets | ||
Common stock, authorized shares | 300,000,000 | 300,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, issued shares | 160,693,918 | 157,529,419 |
Common stock, outstanding shares | 160,693,918 | 157,529,419 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Consolidated Statements of Operations | ||||
Revenue | $ 5,147,920 | $ 4,561,467 | $ 14,849,662 | $ 13,347,014 |
Cost of revenue | 4,962,741 | 4,386,291 | 14,387,059 | 12,833,421 |
Gross profit | 185,179 | 175,176 | 462,603 | 513,593 |
Equity in earnings of joint ventures | 12,863 | 66,458 | 55,621 | 109,667 |
General and administrative expenses | (35,159) | (33,944) | (100,046) | (96,427) |
Impairment of assets held for sale, including goodwill | (168,178) | |||
Acquisition and integration expense | (35,409) | |||
(Loss) gain on disposal activities | (2,149) | (2,149) | 572 | |
Income from operations | 160,734 | 207,690 | 247,851 | 491,996 |
Other income | 2,752 | 2,136 | 17,542 | 4,237 |
Interest expense | (55,213) | (61,547) | (211,955) | (176,985) |
Income before income tax expense (benefit) | 108,273 | 148,279 | 53,438 | 319,248 |
Income tax expense (benefit) | 33,131 | 12,205 | (38,362) | 1,556 |
Net income | 75,142 | 136,074 | 91,800 | 317,692 |
Noncontrolling interests in income of consolidated subsidiaries, net of tax | (14,232) | (34,747) | (39,309) | (66,790) |
Net income attributable to AECOM | $ 60,910 | $ 101,327 | $ 52,491 | $ 250,902 |
Net income attributable to AECOM per share: | ||||
Basic (in dollars per share) | $ 0.38 | $ 0.65 | $ 0.33 | $ 1.62 |
Diluted (in dollars per share) | $ 0.37 | $ 0.64 | $ 0.32 | $ 1.58 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 160,395 | 155,763 | 159,266 | 155,128 |
Diluted (in shares) | 163,213 | 158,820 | 162,426 | 158,488 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Consolidated Statements of Comprehensive Income | ||||
Net income | $ 75,142 | $ 136,074 | $ 91,800 | $ 317,692 |
Other comprehensive (loss) income, net of tax: | ||||
Net unrealized gain (loss) on derivatives, net of tax | 626 | 563 | (214) | 4,263 |
Foreign currency translation adjustments | (67,255) | 46,203 | (57,742) | 13,164 |
Pension adjustments, net of tax | 15,188 | (6,562) | 1,553 | 8,866 |
Other comprehensive (loss) income, net of tax | (51,441) | 40,204 | (56,403) | 26,293 |
Comprehensive income, net of tax | 23,701 | 176,278 | 35,397 | 343,985 |
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax | (14,078) | (35,032) | (40,532) | (67,160) |
Comprehensive income (loss) attributable to AECOM, net of tax | $ 9,623 | $ 141,246 | $ (5,135) | $ 276,825 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 91,800 | $ 317,692 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 200,141 | 205,978 |
Equity in earnings of unconsolidated joint ventures | (55,621) | (109,667) |
Distribution of earnings from unconsolidated joint ventures | 86,367 | 110,934 |
Non-cash stock compensation | 54,341 | 58,674 |
Prepayment premium on redemption of unsecured senior notes | 34,504 | |
Impairment of assets held for sale, including goodwill | 168,178 | |
Foreign currency translation | (49,687) | (1,058) |
Write-off of debt issuance costs | 7,048 | |
Loss (gain) on disposal activities | 2,149 | (572) |
Other | 115 | (8,027) |
Changes in operating assets and liabilities, net of effects of acquisitions: | ||
Accounts receivable | (365,608) | (146,912) |
Prepaid expenses and other assets | (32,375) | (108,214) |
Accounts payable | 258,349 | 264,698 |
Accrued expenses and other current liabilities | (94,533) | (159,766) |
Billings in excess of costs on uncompleted contracts | 41,662 | 108,119 |
Other long-term liabilities | (104,163) | (86,522) |
Net cash provided by operating activities | 242,667 | 445,357 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds (payments) related to business acquisitions | 2,203 | (1,733) |
Cash acquired from consolidation of joint venture | 7,630 | |
Proceeds from disposal of businesses, net of cash disposed | 19,537 | 2,200 |
Investment in unconsolidated joint ventures | (75,992) | (44,882) |
Return of investment in unconsolidated joint ventures | 12,700 | 34,087 |
Proceeds from sales of investments | 2,738 | 700 |
Payments for purchase of investments | (20,240) | |
Proceeds from disposal of property and equipment | 23,124 | 6,178 |
Payments for capital expenditures | (88,754) | (64,677) |
Net cash used in investing activities | (117,054) | (68,127) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from borrowings under credit agreements | 7,439,180 | 4,638,662 |
Repayments of borrowings under credit agreements | (6,654,873) | (5,635,212) |
Proceeds from issuance of unsecured senior notes | 1,000,000 | |
Redemption of unsecured senior notes | (800,000) | (179,208) |
Prepayment premium on redemption of unsecured senior notes | (34,504) | |
Cash paid for debt issuance costs | (10,708) | (13,041) |
Proceeds from issuance of common stock | 27,300 | 24,717 |
Proceeds from exercise of stock options | 3,200 | 3,679 |
Payments to repurchase common stock | (29,342) | (22,332) |
Net distributions to noncontrolling interests | (72,736) | (44,603) |
Other financing activities | 8,702 | (29,421) |
Net cash used in financing activities | (123,781) | (256,759) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (2,775) | (157) |
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (943) | 120,314 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 802,362 | 692,145 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 801,419 | $ 812,459 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jun. 30, 2018 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The accompanying consolidated financial statements of AECOM (the Company) are unaudited and, in the opinion of management, include all adjustments, including all normal recurring items necessary for a fair statement of the Company’s financial position and results of operations for the periods presented. All intercompany balances and transactions are eliminated in consolidation. The consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended September 30, 2017 (the Annual Report). The accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with generally accepted accounting principles (GAAP) in the United States (U.S.) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The consolidated financial statements included in this report have been prepared consistently with the accounting policies described in the Annual Report and should be read together with the Annual Report. The results of operations for the three and nine months ended June 30, 2018 are not necessarily indicative of the results to be expected for the fiscal year ending September 30, 2018. The Company reports its annual results of operations based on 52 or 53-week periods ending on the Friday nearest September 30. The Company reports its quarterly results of operations based on periods ending on the Friday nearest December 31, March 31, and June 30. For clarity of presentation, all periods are presented as if the periods ended on September 30, December 31, March 31, and June 30. |
New Accounting Pronouncements a
New Accounting Pronouncements and Changes in Accounting | 9 Months Ended |
Jun. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting | |
New Accounting Pronouncements and Changes in Accounting | 2. New Accounting Pronouncements and Changes in Accounting In May 2014, the Financial Accounting Standards Board (FASB) issued new accounting guidance which amended the existing accounting standards for revenue recognition. The new accounting guidance establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. The Company continues to evaluate the impact of the new guidance on its consolidated financial statements, including the expected impact on its business processes, systems, and controls, and potential differences in the timing or method of revenue recognition for its contracts. The Company will adopt the new standard on October 1, 2018, using the modified retrospective method, which requires recognizing the net cumulative effects of adoption as an adjustment to retained earnings. Based on its initial evaluation, the Company expects the impacts of adoption to be primarily related to combining contracts that were previously segmented into a single performance obligation. In February 2016, the FASB issued new accounting guidance which changes accounting requirements for leases. The new guidance requires lessees to recognize the assets and liabilities arising from all leases, including those classified as operating leases under previous accounting guidance, on the balance sheet. It also requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. The new guidance will be effective for the Company’s fiscal year beginning October 1, 2019 with early adoption permitted. The new guidance must be adopted using a modified retrospective transition approach and provides for some practical expedients. The Company is currently evaluating the impact that the new guidance will have on its consolidated financial statements. In February 2016, the FASB issued new accounting guidance to clarify that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument under previous guidance does not, in and of itself, require redesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met. The Company adopted the new guidance on October 1, 2017; and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued new accounting guidance which eliminates the requirement to apply the equity method of accounting retrospectively when a reporting entity obtains significant influence over a previously held investment. The Company adopted the new guidance on October 1, 2017; and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In June 2016, the FASB issued a new credit loss standard that changes the impairment model for most financial assets and some other instruments. The new guidance will replace the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. It also simplifies the accounting model for purchased credit-impaired debt securities and loans. The guidance will be effective for the Company’s fiscal year starting October 1, 2020. The Company is currently evaluating the impact that the new guidance will have on its consolidated financial statements. In August 2016, the FASB issued new accounting guidance clarifying how entities should classify cash receipts and cash payments on the statement of cash flows. The new guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The new guidance will be effective for the Company in its fiscal year beginning October 1, 2018 and early adoption is permitted. The Company is currently evaluating the impact that the new guidance will have on its consolidated statement of cash flows. In October 2016, the FASB issued additional guidance on how a single decision maker considers its indirect interests when performing the primary beneficiary analysis under the variable interest model. Under the new guidance, the single decision maker will consider its indirect interests on a proportionate basis. The Company adopted the new guidance on October 1, 2017 and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued new accounting guidance to simplify the test for goodwill impairment. This guidance eliminates step two from the goodwill impairment test. Under the new guidance, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value. However, the loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The Company early adopted the new guidance on January 1, 2018 and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In August 2017, the FASB issued new accounting guidance on derivatives and hedging. This guidance better aligns an entity’s risk management activities and financial reporting for hedging relationships through change to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedging results. The Company early adopted the guidance on January 1, 2018 and the adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. |
Business Acquisitions, Goodwill
Business Acquisitions, Goodwill and Intangible Assets | 9 Months Ended |
Jun. 30, 2018 | |
Business Acquisitions, Goodwill and Intangible Assets | |
Business Acquisitions, Goodwill and Intangible Assets | 3. Business Acquisitions, Goodwill and Intangible Assets The Company completed one acquisition during the nine months ended June 30, 2018 and two acquisitions during the year ended September 30, 2017 for a total consideration of $5.6 million and $164.4 million, respectively. The business combinations did not meet the quantitative thresholds to require separate disclosures based on the Company’s consolidated net assets, investments and net income. The acquisitions were accounted for under the purchase method of accounting. As such, the purchase considerations were allocated to acquired tangible and intangible assets and liabilities based upon their fair values. The determination of fair values of assets and liabilities acquired requires the Company to make estimates and use valuation techniques when market value is not readily available. Transaction costs associated with business acquisitions are expensed as they are incurred. On October 17, 2014, the Company completed the acquisition of the U.S. headquartered URS Corporation (URS), an international provider of engineering, construction, and technical services, by purchasing 100% of the outstanding shares of URS common stock. The Company paid total consideration of approximately $2.3 billion in cash and issued approximately $1.6 billion of AECOM common stock to the former stockholders and equity award holders of URS. In connection with the acquisition, the Company also assumed URS’s senior notes totaling $0.4 billion, net of Company repayments. The Company repaid in full URS’s $0.6 billion 2011 term loan and $0.1 billion of URS’s revolving line of credit. The Company acquired backlog and customer relationship intangible assets valued at $973.8 million representing the fair value of existing contracts and the underlying customer relationships that have lives ranging from 1 to 11 years (weighted average lives of approximately 3 years) in connection with the URS acquisition. Acquired accrued expenses and other current liabilities include URS project liabilities and approximately $240 million related to estimated URS legal settlements and uninsured legal damages; see Note 14, “Commitments and Contingencies,” including legal matters related to former URS affiliates. Amortization of intangible assets relating to URS, included in cost of revenue, was $16.0 million and $20.9 million during the three months ended June 30, 2018 and 2017, respectively, and $52.4 million and $62.7 million during the nine months ended June 30, 2018 and 2017, respectively. Additionally, included in equity in earnings of joint ventures and noncontrolling interests was intangible amortization expense of $1.7 million and $(2.0) million, respectively, during the three months ended June 30, 2018 and $2.4 million and $(2.1) million, respectively, during the three months ended June 30, 2017, related to joint venture fair value adjustments. Included in equity in earnings of joint ventures and noncontrolling interests was intangible amortization expense of $5.3 million and $(6.2) million, respectively, during the nine months ended June 30, 2018 and $6.9 million and $(6.4) million, respectively, during the nine months ended June 30, 2017, related to joint venture fair value adjustments. Billings in excess of costs on uncompleted contracts includes a margin fair value liability associated with long-term contracts acquired. This margin fair value liability was $24.1 million at June 30, 2018 and $8.6 million at September 30, 2017, and is recognized as revenue on a percentage-of-completion basis as the applicable projects progress. Income from operations related to the margin fair value liability recognized during the three months ended June 30, 2018 and 2017 was $8.1 million and $1.6 million, respectively. Acquisition and integration expenses, relating to business acquisitions, in the accompanying consolidated statements of operations are comprised of the following: Nine months ended (in millions) Severance and personnel costs $ Professional service, real estate-related, and other expenses Total $ Included in severance and personnel costs for the nine months ended June 30, 2017 was $7.7 million of severance expenses, which was substantially all paid as of June 30, 2018. All acquisition and integration expenses are classified within the Corporate segment, as presented in Note 15. Our acquisition and integration expenses associated with the URS acquisition are complete. In the second quarter of fiscal year 2018, management approved a plan to sell non-core oil and gas assets in North America, included in the Company’s Construction Services segment (the Disposal Group). The Company classified the related assets and liabilities of the Disposal Group as held for sale in the consolidated balance sheet. In the third quarter of fiscal year 2018, the Company sold a portion of the assets in the Disposal Group and recognized a $2.1 million loss on disposal. The remaining unsold portion of the Disposal Group remains classified as held for sale. The Company recorded losses related to the remeasurement of the Disposal Group based on estimated fair value less costs to sell resulting in total asset impairments of $168.2 million, recorded in Impairment of Assets Held for Sale. Fair value was estimated using Level 3 inputs, such as forecasted cash flows, and Level 2 inputs, including bid prices from potential buyers. In connection with the classification of the Disposal Group as held for sale, the Company tested the amount of goodwill and other intangible assets allocated to the Disposal Group for impairment. The Company recorded an impairment of goodwill during the nine months ended June 30, 2018 of $125.4 million and an impairment of intangible and other noncurrent assets of $42.8 million. As of June 30, 2018, current assets held for sale were primarily comprised of accounts receivable of $48.0 million and property, plant and equipment of $14.3 million. As of June 30, 2018, current liabilities held for sale were primarily comprised of accounts payable of $12.6 million. The Company expects to complete the sale of the remaining Disposal Group assets within the next twelve months. The changes in the carrying value of goodwill by reportable segment for the nine months ended June 30, 2018 were as follows: September 30, Measurement Impairment Foreign June 30, (in millions) Design and Consulting Services $ $ — $ — $ ) $ Construction Services ) ) Management Services — — Total $ $ $ ) $ ) $ The gross amounts and accumulated amortization of the Company’s acquired identifiable intangible assets with finite useful lives as of June 30, 2018 and September 30, 2017, included in intangible assets—net, in the accompanying consolidated balance sheets, were as follows: June 30, 2018 September 30, 2017 Gross Accumulated Intangible Gross Accumulated Intangible Amortization (in millions) (years) Backlog and customer relationships $ $ ) $ $ $ ) $ 1 - 11 Trademark / tradename ) ) 0.3 - 2 Total $ $ ) $ $ $ ) $ Amortization expense of acquired intangible assets included within cost of revenue was $75.0 million and $76.5 million for the nine months ended June 30, 2018 and 2017, respectively. The following table presents estimated amortization expense of existing intangible assets for the remainder of fiscal year 2018 and for the succeeding years: Fiscal Year (in millions) 2018 (three months remaining) $ 2019 2020 2021 2022 Thereafter Total $ |
Accounts Receivable - Net
Accounts Receivable - Net | 9 Months Ended |
Jun. 30, 2018 | |
Accounts Receivable - Net | |
Accounts Receivable - Net | 4. Accounts Receivable—Net Net accounts receivable consisted of the following: June 30, September 30, (in millions) Billed $ $ Unbilled Contract retentions Total accounts receivable—gross Allowance for doubtful accounts ) ) Total accounts receivable—net $ $ Billed accounts receivable represents amounts billed to clients that have yet to be collected. Unbilled accounts receivable represents the contract revenue recognized but not yet billed pursuant to contract terms or accounts billed after the period end. Substantially all unbilled receivables as of June 30, 2018 and September 30, 2017 are expected to be billed and collected within twelve months. Contract retentions represent amounts invoiced to clients where payments have been withheld pending the completion of milestones, other contractual conditions, or upon the completion of a project. These retention agreements vary from project to project and could be outstanding for several months or years. Allowances for doubtful accounts have been determined through specific identification of amounts considered to be uncollectible and potential write-offs, plus a non-specific allowance for other amounts for which some potential loss has been determined to be probable based on current and past experience. Other than the U.S. government, no single client accounted for more than 10% of the Company’s outstanding receivables at June 30, 2018 and September 30, 2017. The Company sold trade receivables to financial institutions, of which $342.7 million and $325.2 million were outstanding as of June 30, 2018 and September 30, 2017, respectively. The Company does not retain financial or legal obligations for these receivables that would result in material losses. The Company’s ongoing involvement is limited to the remittance of customer payments to the financial institutions with respect to the sold trade receivables. |
Joint Ventures and Variable Int
Joint Ventures and Variable Interest Entities | 9 Months Ended |
Jun. 30, 2018 | |
Joint Ventures and Variable Interest Entities | |
Joint Ventures and Variable Interest Entities | 5. Joint Ventures and Variable Interest Entities The Company’s joint ventures provide architecture, engineering, program management, construction management, operations and maintenance services, and invest in real estate, public-private partnership (P3) and infrastructure projects. Joint ventures, the combination of two or more partners, are generally formed for a specific project. Management of the joint venture is typically controlled by a joint venture executive committee, comprised of representatives from the joint venture partners. The joint venture executive committee normally provides management oversight and controls decisions which could have a significant impact on the joint venture. Some of the Company’s joint ventures have no employees and minimal operating expenses. For these joint ventures, the Company’s employees perform work for the joint venture, which is then billed to a third-party customer by the joint venture. These joint ventures function as pass through entities to bill the third-party customer. For consolidated joint ventures of this type, the Company records the entire amount of the services performed and the costs associated with these services, including the services provided by the other joint venture partners, in the Company’s result of operations. For some of these joint ventures where a fee is added by an unconsolidated joint venture to client billings, the Company’s portion of that fee is recorded in equity in earnings of joint ventures. The Company also has joint ventures that have their own employees and operating expenses, and to which the Company generally makes a capital contribution. The Company accounts for these joint ventures either as consolidated entities or equity method investments based on the criteria further discussed below. The Company follows guidance on the consolidation of variable interest entities (VIEs) that requires companies to utilize a qualitative approach to determine whether it is the primary beneficiary of a VIE. The process for identifying the primary beneficiary of a VIE requires consideration of the factors that indicate a party has the power to direct the activities that most significantly impact the joint venture’s economic performance, including powers granted to the joint venture’s program manager, powers contained in the joint venture governing board and a company’s economic interest in the joint venture. The Company analyzes its joint ventures and classifies them as either: · a VIE that must be consolidated because the Company is the primary beneficiary or the joint venture is not a VIE and the Company holds the majority voting interest with no significant participative rights available to the other partners; or · a VIE that does not require consolidation and is treated as an equity method investment because the Company is not the primary beneficiary or the joint venture is not a VIE and the Company does not hold the majority voting interest. As part of the above analysis, if it is determined that the Company has the power to direct the activities that most significantly impact the joint venture’s economic performance, the Company considers whether or not it has the obligation to absorb losses or rights to receive benefits of the VIE that could potentially be significant to the VIE. Contractually required support provided to the Company’s joint ventures is further discussed in Note 14. Summary of unaudited financial information of the consolidated joint ventures is as follows: June 30, September 30, (in millions) Current assets $ $ Non-current assets Total assets $ $ Current liabilities $ $ Non-current liabilities Total liabilities Total AECOM equity Noncontrolling interests Total owners’ equity Total liabilities and owners’ equity $ $ Total revenue of the consolidated joint ventures was $1,820.8 million and $1,457.0 million for the nine months ended June 30, 2018 and 2017, respectively. The assets of the Company’s consolidated joint ventures are restricted for use only by the particular joint venture and are not available for the general operations of the Company. Summary of unaudited financial information of the unconsolidated joint ventures is as follows: June 30, September 30, (in millions) Current assets $ $ Non-current assets Total assets $ $ Current liabilities $ $ Non-current liabilities Total liabilities Joint ventures’ equity Total liabilities and joint ventures’ equity $ $ AECOM’s investment in joint ventures $ $ Nine Months Ended June 30, June 30, (in millions) Revenue $ $ Cost of revenue Gross profit $ $ Net income $ $ Summary of AECOM’s equity in earnings of unconsolidated joint ventures is as follows: Nine Months Ended June 30, June 30, (in millions) Pass through joint ventures $ $ Other joint ventures Total $ $ |
Pension Benefit Obligations
Pension Benefit Obligations | 9 Months Ended |
Jun. 30, 2018 | |
Pension Benefit Obligations | |
Pension Benefit Obligations | 6. Pension Benefit Obligations In the U.S., the Company sponsors various qualified defined benefit pension plans. Benefits under these plans generally are based on the employee’s years of creditable service and compensation; however, all U.S. defined benefit plans are closed to new participants and have frozen accruals. The Company also sponsors various non-qualified plans in the U.S.; all of these plans are frozen. Outside the U.S., the Company sponsors various pension plans, which are appropriate to the country in which the Company operates, some of which are government mandated. The following table details the components of net periodic cost for the Company’s pension plans for the three and nine months ended June 30, 2018 and 2017: Three Months Ended Nine Months Ended June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 U.S. Int’l U.S. Int’l U.S. Int’l U.S. Int’l (in millions) Components of net periodic (benefit) cost: Service costs $ $ $ $ $ $ $ $ Interest cost on projected benefit obligation Expected return on plan assets ) ) ) ) ) ) ) ) Amortization of prior service cost — — — — — ) — ) Amortization of net loss Settlement loss recognized — — — — — — — Net periodic (benefit) cost $ ) $ ) $ ) $ $ ) $ ) $ ) $ The total amounts of employer contributions paid for the nine months ended June 30, 2018 were $6.6 million for U.S. plans and $21.1 million for non-U.S. plans. The expected remaining scheduled annual employer contributions for the fiscal year ending September 30, 2018 are $5.2 million for U.S. plans and $6.2 million for non-U.S. plans. |
Debt
Debt | 9 Months Ended |
Jun. 30, 2018 | |
Debt | |
Debt | 7. Debt Debt consisted of the following: June 30, September 30, (in millions) 2014 Credit Agreement $ $ 2014 Senior Notes 2017 Senior Notes URS Senior Notes Other debt Total debt Less: Current portion of debt and short-term borrowings ) ) Less: Unamortized debt issuance costs ) ) Long-term debt $ $ The following table presents, in millions, scheduled maturities of the Company’s debt as of June 30, 2018: Fiscal Year 2018 (three months remaining) $ 2019 2020 2021 2022 Thereafter Total $ 2014 Credit Agreement The Company entered into a credit agreement (Credit Agreement) on October 17, 2014, which, as amended to date, consists of (i) a term loan A facility that includes a $510 million (US) term loan A facility with a term expiring on March 13, 2021 and a $500 million Canadian dollar (CAD) term loan A facility and a $250 million Australian dollar (AUD) term loan A facility, each with terms expiring on March 13, 2023; (ii) a $600 million term loan B facility with a term expiring on March 13, 2025; and (iii) a revolving credit facility in an aggregate principal amount of $1.35 billion with a term expiring on March 13, 2023. Some subsidiaries of the Company (Guarantors) have guaranteed the obligations of the borrowers under the Credit Agreement. The borrowers’ obligations under the Credit Agreement are secured by a lien on substantially all of the assets of the Company and the Guarantors pursuant to a security and pledge agreement (Security Agreement). The collateral under the Security Agreement is subject to release upon fulfillment of conditions specified in the Credit Agreement and Security Agreement. The Credit Agreement contains covenants that limit the ability of the Company and the ability of some of its subsidiaries to, among other things: (i) create, incur, assume, or suffer to exist liens; (ii) incur or guarantee indebtedness; (iii) pay dividends or repurchase stock; (iv) enter into transactions with affiliates; (v) consummate asset sales, acquisitions or mergers; (vi) enter into various types of burdensome agreements; or (vii) make investments. On July 1, 2015, the Credit Agreement was amended to revise the definition of “Consolidated EBITDA” to increase the allowance for acquisition and integration expenses related to the acquisition of URS. On December 22, 2015, the Credit Agreement was amended to further revise the definition of “Consolidated EBITDA” by further increasing the allowance for acquisition and integration expenses related to the acquisition of URS and to allow for an internal corporate restructuring primarily involving its international subsidiaries. On September 29, 2016, the Credit Agreement and the Security Agreement were amended to (1) lower the applicable interest rate margins for the term loan A and the revolving credit facilities, and lower the applicable letter of credit fees and commitment fees to the revised consolidated leverage levels; (2) extend the term of the term loan A and the revolving credit facility to September 29, 2021; (3) add a new delayed draw term loan A facility tranche in the amount of $185.0 million; (4) replace the then existing $500 million performance letter of credit facility with a $500 million basket to enter into secured letters of credit outside the Credit Agreement; and (5) revise covenants, including the Maximum Consolidated Leverage Ratio so that the step down from a 5.00 to a 4.75 leverage ratio is effective as of March 31, 2017 as well as the investment basket for its AECOM Capital business. On March 31, 2017, the Credit Agreement was amended to (1) expand the ability of restricted subsidiaries to borrow under “Incremental Term Loans;” (2) revise the definition of “Working Capital” as used in “Excess Cash Flow;” (3) revise the definitions for “Consolidated EBITDA” and “Consolidated Funded Indebtedness” to reflect the expected gain and debt repayment of an AECOM Capital disposition, which disposition was completed on April 28, 2017; and (4) amend provisions relating to the Company’s ability to undertake internal restructuring steps to accommodate changes in tax laws. On March 13, 2018, the Credit Agreement was amended to (1) refinance the existing term loan A facility to include a $510 million (US) term loan A facility with a term expiring on March 13, 2021 and a $500 million CAD term loan A facility and a $250 million AUD term loan A facility each with terms expiring on March 13, 2023; (2) issue a new $600 million term loan B facility to institutional investors with a term expiring on March 13, 2025; (3) increase the capacity of the Company’s revolving credit facility from $1.05 billion to $1.35 billion and extend its term until March 13, 2023; (4) reduce the Company’s interest rate borrowing costs as follows: (a) the term loan B facility, at the Company’s election, Base Rate (as defined in the Credit Agreement) plus 0.75% or Eurocurrency Rate (as defined in the Credit Agreement) plus 1.75%, (b) the (US) term loan A facility, at the Company’s election, Base Rate plus 0.50% or Eurocurrency Rate plus 1.50%, and (c) the Canadian (CAD) term loan A facility, the Australian (AUD) term loan A facility, and the revolving credit facility, an initial rate of, at the Company’s election, Base Rate plus 0.75% or Eurocurrency Rate plus 1.75%, and after the end of the Company’s fiscal quarter ended June 30, 2018, Base Rate loans plus a margin ranging from 0.25% to 1.00% or Eurocurrency Rate plus a margin from 1.25% to 2.00%, based on the Consolidated Leverage Ratio (as defined in the Credit Agreement); and (5) revise covenants including increasing the amounts available under the restricted payment negative covenant and revising the Maximum Consolidated Leverage Ratio (as defined in the Credit Agreement) to include a 4.5 leverage ratio through September 30, 2019 after which the leverage ratio steps down to 4.0. Under the Credit Agreement, the Company is subject to a maximum consolidated leverage ratio and minimum consolidated interest coverage ratio at the end of each fiscal quarter. The Company’s Consolidated Leverage Ratio was 4.1 at June 30, 2018. The Company’s Consolidated Interest Coverage Ratio was 4.6 at June 30, 2018. As of June 30, 2018, the Company was in compliance with the covenants of the Credit Agreement. At June 30, 2018 and September 30, 2017, outstanding standby letters of credit totaled $53.9 million and $58.1 million, respectively, under the Company’s revolving credit facilities. As of June 30, 2018 and September 30, 2017, the Company had $1,220.4 million and $991.9 million, respectively, available under its revolving credit facility. 2014 Senior Notes On October 6, 2014, the Company completed a private placement offering of $800,000,000 aggregate principal amount of its unsecured 5.75% Senior Notes due 2022 (2022 Notes) and $800,000,000 aggregate principal amount of its unsecured 5.875% Senior Notes due 2024 (the 2024 Notes and, together with the 2022 Notes, the 2014 Senior Notes). On November 2, 2015, the Company completed an exchange offer to exchange the unregistered 2014 Senior Notes for registered notes, as well as all related guarantees. On March 16, 2018, the Company redeemed all of the 2022 Notes at a redemption price that was 104.313% of the principal amount outstanding plus accrued and unpaid interest. The March 16, 2018 redemption resulted in a $34.5 million prepayment premium, which was included in interest expense. As of June 30, 2018, the estimated fair value of its 2024 Notes was approximately $824.0 million. The fair value of the 2024 Notes as of June 30, 2018 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2024 Notes. At any time prior to July 15, 2024, the Company may redeem on one or more occasions all or part of the 2024 Notes at a redemption price equal to the sum of (i) 100% of the principal amount thereof, plus (ii) a “make-whole” premium as of the date of the redemption, plus any accrued and unpaid interest to the date of redemption. In addition, on or after July 15, 2024, the 2024 Notes may be redeemed at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest to the date of redemption. The indenture pursuant to which the 2024 Notes were issued contains customary events of default, including, among other things, payment default, exchange default, failure to provide notices thereunder and provisions related to bankruptcy events. The indenture also contains customary negative covenants. The Company was in compliance with the covenants relating to the 2024 Notes as of June 30, 2018. 2017 Senior Notes On February 21, 2017, the Company completed a private placement offering of $1,000,000,000 aggregate principal amount of its unsecured 5.125% Senior Notes due 2027 (the 2017 Senior Notes) and used the note proceeds to immediately retire the remaining $127.6 million outstanding on the then existing term loan B facility as well as repay $600 million of the term loan A facility and $250 million of the revolving credit facility under its Credit Agreement. On June 30, 2017, the Company completed an exchange offer to exchange the unregistered 2017 Senior Notes for registered notes, as well as related guarantees. As of June 30, 2018, the estimated fair value of the Company’s 2017 Senior Notes was approximately $935.0 million. The fair value of the Company’s 2017 Senior Notes as of June 30, 2018 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2017 Senior Notes. Interest is payable on the 2017 Senior Notes at a rate of 5.125% per annum. Interest on the 2017 Senior Notes is payable semi-annually on March 15 and September 15 of each year. The 2017 Senior Notes will mature on March 15, 2027. At any time and from time to time prior to December 15, 2026, the Company may redeem all or part of the 2017 Senior Notes, at a redemption price equal to 100% of their principal amount, plus a “make whole” premium as of the redemption date, and accrued and unpaid interest to the redemption date. In addition, at any time and from time to time prior to March 15, 2020, the Company may redeem up to 35% of the original aggregate principal amount of the 2017 Senior Notes with the proceeds of one or more qualified equity offerings, at a redemption price equal to 105.125%, plus accrued and unpaid interest. Furthermore, at any time on or after December 15, 2026, the Company may redeem on one or more occasions all or part of the 2017 Senior Notes at a redemption price equal to 100% of their principal amount, plus accrued and unpaid interest. The indenture pursuant to which the 2017 Senior Notes were issued contains customary events of default, including, among other things, payment default, exchange default, failure to provide notices thereunder and provisions related to bankruptcy events. The indenture also contains customary negative covenants. The Company was in compliance with the covenants relating to the 2017 Senior Notes as of June 30, 2018. URS Senior Notes In connection with the URS acquisition, the Company assumed URS 3.85% Senior Notes due 2017 (2017 URS Senior Notes) and the URS 5.00% Senior Notes due 2022 (2022 URS Senior Notes), totaling $1.0 billion (URS Senior Notes). The URS acquisition triggered change in control provisions in the URS Senior Notes that allowed the holders of the URS Senior Notes to redeem their URS Senior Notes at a cash price equal to 101% of the principal amount and, accordingly, the Company redeemed $572.3 million of the URS Senior Notes on October 24, 2014. The remaining 2017 URS Senior Notes matured and were fully redeemed on April 3, 2017 for $179.2 million using proceeds from a $185 million delayed draw term loan A facility tranche under the Credit Agreement. The 2022 URS Senior Notes are general unsecured senior obligations of AECOM Global II, LLC (as successor in interest to URS) and are fully and unconditionally guaranteed on a joint-and-several basis by some former URS domestic subsidiary guarantors. As of June 30, 2018, the estimated fair value of the 2022 URS Senior Notes was approximately $251.0 million. The carrying value of the 2022 URS Senior Notes on the Company’s Consolidated Balance Sheets as of June 30, 2018 was $247.8 million. The fair value of the 2022 URS Senior Notes as of June 30, 2018 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2022 URS Senior Notes. As of June 30, 2018, the Company was in compliance with the covenants relating to the 2022 URS Senior Notes. Other Debt and Other Items Other debt consists primarily of obligations under capital leases and loans, and unsecured credit facilities of $214.3 million as of June 30, 2018. The Company’s unsecured credit facilities are primarily used for standby letters of credit issued in conjunction with general and professional liability insurance programs and for contract performance guarantees. At June 30, 2018 and September 30, 2017, these outstanding standby letters of credit totaled $451.9 million and $445.7 million, respectively. As of June 30, 2018, the Company had $485.9 million available under these unsecured credit facilities. Effective Interest Rate The Company’s average effective interest rate on its total debt, including the effects of the interest rate swap agreements, during the nine months ended June 30, 2018 and 2017 was 4.6% and 4.4%, respectively. Interest expense in the consolidated statements of operations for the nine months ended June 30, 2018 included a prepayment premium of $34.5 million to redeem the 2022 Notes. Additionally, amortization of deferred debt issuance costs for the three and nine months ended June 30, 2018 was $2.5 million and $15.1 million, respectively, and for the three and nine months ended June 30, 2017 was $2.8 million and $14.3 million, respectively. |
Derivative Financial Instrument
Derivative Financial Instruments and Fair Value Measurements | 9 Months Ended |
Jun. 30, 2018 | |
Derivative Financial Instruments and Fair Value Measurements | |
Derivative Financial Instruments and Fair Value Measurements | 8. Derivative Financial Instruments and Fair Value Measurements The Company uses interest rate derivative contracts to hedge interest rate exposures on the Company’s variable rate debt. The Company enters into foreign currency derivative contracts with financial institutions to reduce the risk that its cash flows and earnings will be adversely affected by foreign currency exchange rate fluctuations. The Company’s hedging program is not designated for trading or speculative purposes. The Company recognizes derivative instruments as either assets or liabilities on the accompanying consolidated balance sheets at fair value. The Company records changes in the fair value (i.e., gains or losses) of the derivatives that have been designated as accounting hedges in the accompanying consolidated statements of operations as cost of revenue, interest expense or to accumulated other comprehensive loss in the accompanying consolidated balance sheets. Cash Flow Hedges The Company uses interest rate swap agreements designated as cash flow hedges to fix the variable interest rates on portions of the Company’s debt. The Company also uses foreign currency contracts designated as cash flow hedges to hedge forecasted revenue transactions denominated in currencies other than the U.S. dollar. The Company initially reports any gain on the effective portion of a cash flow hedge as a component of accumulated other comprehensive loss. Depending on the type of cash flow hedge, the gain is subsequently reclassified to either interest expense when the interest expense on the variable rate debt is recognized, or to cost of revenue when the hedged revenues are recorded. If the hedged transaction becomes probable of not occurring, any gain or loss related to interest rate swap agreements or foreign currency contracts would be recognized in other income (expense). Further, the Company excludes the change in the time value of the foreign currency contracts from the assessment of hedge effectiveness. The Company records the premium paid or time value of a contract on the date of purchase as an asset. Thereafter, the Company recognizes any change to this time value in cost of revenue. The notional principal in U.S. dollar (USD), Canadian dollar (CAD), and Australian dollar (AUD), fixed rates and related expiration dates of the Company’s outstanding interest rate swap agreements were as follows: June 30, 2018 Notional Amount Notional Amount Fixed Expiration USD % September 2018 AUD % February 2021 CAD % September 2022 USD % February 2023 September 30, 2017 Notional Amount Notional Amount Fixed Expiration USD % June 2018 USD % September 2018 The notional principal of outstanding foreign currency contracts to purchase AUD was AUD 67.3 million (or $50.9 million) and AUD 15.1 million (or $11.3 million) at June 30, 2018 and September 30, 2017, respectively. Other Foreign Currency Forward Contracts The Company uses foreign currency forward contracts which are not designated as accounting hedges to hedge intercompany transactions and other monetary assets or liabilities denominated in currencies other than the functional currency of a subsidiary. Gains and losses on these contracts were not material for the nine months ended June 30, 2018 and 2017. Fair Value Measurements The Company’s non-pension financial assets and liabilities recorded at fair value relate to derivative instruments and were not material at June 30, 2018 or September 30, 2017. See Note 13 for accumulated balances and reporting period activities of derivatives related to reclassifications out of accumulated other comprehensive income or loss for the nine months ended June 30, 2018 and 2017. Amounts recognized in accumulated other comprehensive loss from the Company’s foreign currency contracts were immaterial for all periods presented. Amounts reclassified from accumulated other comprehensive loss into income from the foreign currency options were immaterial for all periods presented. Additionally, there were no losses recognized in income due to amounts excluded from effectiveness testing from the Company’s interest rate swap agreements. During the year ended September 30, 2015, the Company entered into a contingent consideration arrangement in connection with a business acquisition. Under the arrangement, the Company agreed to pay cash to the sellers if financial performance thresholds are achieved in the future. The fair value of the contingent consideration liability, net of amounts paid, as of June 30, 2018 and September 30, 2017 was $13 million and $13 million, respectively. This liability is a Level 3 fair value measurement recorded within other accrued liabilities, and was valued based on estimated future net cash flows. Any future changes in the fair value of this contingent consideration liability will be recognized in earnings during the applicable period. |
Share-based Payments
Share-based Payments | 9 Months Ended |
Jun. 30, 2018 | |
Share-based Payments | |
Share-based Payments | 9. Share-based Payments The fair value of an outstanding employee stock option award is estimated on the date of grant. The expected term of the stock option granted represents the period of time the stock option expected to be outstanding. The risk-free interest rate is based on U.S. Treasury bond rates with maturities equal to the expected term of the stock option on the grant date. The Company uses historical data as a basis to estimate the probability of forfeitures. Stock option activity for the nine months ended June 30 was as follows: 2018 2017 Shares of stock Weighted average Shares of stock Weighted average (in millions) (in millions) Outstanding at September 30, prior year $ $ Options granted — — — — Options exercised ) ) Options forfeited or expired — — — — Outstanding at June 30 Vested and expected to vest in the future as of June 30 $ $ The Company grants stock units to employees under its Performance Earnings Program (PEP), whereby units are earned and issued dependent upon meeting established cumulative performance objectives and vest over a three-year service period. Additionally, the Company issues restricted stock units to employees which are earned based on service conditions. The grant date fair value of PEP awards and restricted stock unit awards is that day’s closing market price of the Company’s common stock. The weighted average grant date fair value of PEP awards was $37.69 and $38.16 during the nine months ended June 30, 2018 and 2017, respectively. The weighted average grant date fair value of restricted stock unit awards was $36.91 and $37.97 during the nine months ended June 30, 2018 and 2017, respectively. Total compensation expense related to share-based payments including stock options was $54.3 million and $58.7 million during the nine months ended June 30, 2018 and 2017, respectively. Unrecognized compensation expense related to total share-based payments outstanding as of June 30, 2018 and September 30, 2017 was $111.1 million and $96.8 million, respectively, to be recognized on a straight-line basis over the awards’ respective vesting periods which are generally three years. |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 30, 2018 | |
Income Taxes | |
Income Taxes | 10. Income Taxes The Company’s effective tax rate was (71.8)% and 0.5% for the nine months ended June 30, 2018 and 2017, respectively. The most significant items contributing to the difference between the statutory U.S. federal income tax rate of 24.5% and the Company’s effective tax rate for the nine-month period ended June 30, 2018 were a $41.7 million net benefit related to one-time U.S. federal tax law changes, a benefit of $33.8 million related to changes in uncertain tax positions primarily in the U.S. and Canada, and a benefit of $21.6 million related to income tax credits and incentives, partially offset by tax expense of $33.9 million related to a goodwill impairment charge, which was non-deductible for tax purposes. These items are not expected to have a continuing impact on the effective tax rate for the remainder of the fiscal year except for the benefits related to income tax credits and incentives. During the second quarter of fiscal year 2018, the Company received a favorable settlement of uncertain tax positions in the U.S. related to R&D credits for tax years 2012, 2013 and 2014 and as a result, recorded an income tax benefit of $26.2 million, which included the remeasurement of its U.S. R&D credit uncertain tax positions for future years based on the favorable outcome of the examination. During the first quarter of fiscal year 2018, President Trump signed what is commonly referred to as The Tax Cuts and Jobs Act (Tax Act) into law. The Tax Act reduced the Company’s U.S. federal corporate tax rate from 35% to a blended tax rate of 24.5% for the Company’s fiscal year ending September 30, 2018 and 21% for fiscal years thereafter, requires companies to pay a one-time transition tax on accumulated earnings of foreign subsidiaries, creates new taxes on foreign sourced earnings and eliminates or reduces deductions. Given the significance of the Tax Act, the SEC staff issued Staff Accounting Bulletin No. 118 (SAB 118), which allows registrants to record provisional amounts during a one year “measurement period” similar to that used when accounting for business combinations. However, the measurement period is deemed to have ended earlier when the registrant has obtained, prepared and analyzed the information necessary to finalize its accounting. During the measurement period, impacts of the law are expected to be recorded at the time a reasonable estimate for all or a portion of the effects can be made, and provisional amounts can be recognized and adjusted as information becomes available, prepared or analyzed. At June 30, 2018, the Company has not completed its accounting for the tax effects of enactment of the Tax Act; however, the Company made a reasonable estimate of the effects on its existing deferred tax balances and other assets and liabilities and the one-time transition tax during the quarter ended December 31, 2017. The Company has not been able to make a reasonable estimate of the impact on its indefinite reinvestment of earnings of foreign subsidiaries and therefore will continue to account for those items based on its existing accounting under ASC 740. As further guidance and accounting interpretations are expected, the Company’s analysis is considered incomplete. Other significant provisions include a base erosion anti-abuse tax (BEAT) on excessive amounts paid to foreign related parties and a minimum tax on global intangible low-taxed income (GILTI). The Company has not elected a method of accounting for BEAT and GILTI and will only do so after completion of the analysis of the provisions and the impact to the Company. In the first quarter of fiscal year 2018, the Company remeasured U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. However, the Company is still analyzing the Tax Act and refining its calculations which could potentially affect the measurement of these balances. The provisional amount recorded in the first quarter related to the remeasurement of the Company’s deferred tax balance was a $36.1 million tax benefit. In addition in the first quarter, the Company released the deferred tax liability and recorded a tax benefit of $77.0 million related to foreign subsidiaries for which the undistributed earnings are not intended to be reinvested indefinitely and accrued current tax on these earnings as part of the one-time transition tax. As of June 30, 2018, the Company has not made any additional measurement period adjustments related to these items. During the first quarter of fiscal year 2018, the Company recorded a provisional amount for the one-time transition tax liability for its foreign subsidiaries resulting in an increase in income tax expense of $71.4 million. The Company has not yet completed its calculation of the total foreign earnings and profits of its foreign subsidiaries. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets at the end of the fiscal year. This amount may change when the Company finalizes the calculation of foreign earnings and finalize the amounts held in cash or other specified assets. As of June 30, 2018, the Company has not made any additional measurement period adjustments related to these items. The Company is utilizing the annual effective tax rate method under ASC 740 to compute its interim tax provision. The Company’s effective tax rate fluctuates from quarter to quarter due to various factors including the change in the mix of global income and expenses, outcomes of administrative audits, changes in the assessment of valuation allowances due to management’s consideration of new positive or negative evidence during the quarter, and changes in enacted tax laws and their interpretations which upon enactment include possible tax reform around the world arising from the result of the base erosion and profit shifting project undertaken by the Organisation for Economic Co-operation Development which, if finalized and adopted, could have a material impact on the Company’s income tax expense and deferred tax balances. The Company is currently under tax audit in several jurisdictions including a U.S. federal income tax examination for URS-pre-acquisition tax years 2012, 2013 and 2014. The Company believes the outcomes which are reasonably possible within the next twelve months, including lapses in statutes of limitations, could result in an adjustment to U.S. net operating loss carryforwards, but will not result in a material change in the liability for uncertain tax positions. Generally, the Company does not provide for U.S. taxes or foreign withholding taxes on gross book-tax differences in its non-U.S. subsidiaries because such basis differences of approximately $1.7 billion are able to and intended to be reinvested indefinitely. At June 30, 2018, the Company has not determined whether it will continue to indefinitely reinvest the earnings of foreign subsidiaries and therefore will continue to account for these undistributed earnings based on existing accounting under ASC 740 and not accrue additional tax outside of the one-time transition tax described above. There may also be additional U.S. or foreign income tax liability upon repatriation, although the calculation of such additional taxes is not practicable. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share | |
Earnings Per Share | 11. Earnings Per Share Basic earnings per share (EPS) excludes dilution and is computed by dividing net income attributable to AECOM by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income attributable to AECOM by the weighted average number of common shares outstanding and potential common shares for the period. The Company includes as potential common shares the weighted average dilutive effects of equity awards using the treasury stock method. For the three and nine months ended June 30, 2018 and 2017, equity awards excluded from the calculation of potential common shares were not significant. The following table sets forth a reconciliation of the denominators for basic and diluted earnings per share: Three Months Ended Nine Months Ended June 30, June 30, June 30, June 30, (in millions) Denominator for basic earnings per share Potential common shares Denominator for diluted earnings per share |
Other Financial Information
Other Financial Information | 9 Months Ended |
Jun. 30, 2018 | |
Other Financial Information | |
Other Financial Information | 12. Other Financial Information Accrued expenses and other current liabilities consist of the following: June 30, September 30, (in millions) Accrued salaries and benefits $ $ Accrued contract costs Other accrued expenses $ $ Accrued contract costs above include balances related to professional liability accruals of $540.5 million and $547.9 million as of June 30, 2018 and September 30, 2017, respectively. The remaining accrued contract costs primarily relate to costs for services provided by subcontractors and other non-employees. Liabilities recorded related to accrued contract losses were not material as of June 30, 2018 and September 30, 2017. The Company did not have material revisions to estimates for contracts where revenue is recognized using the percentage-of-completion method during the nine months ended June 30, 2018. The Company incurred $26.7 million of primarily severance expenses relating to restructuring activities during the nine months ended June 30, 2018, of which $23.3 million was paid as of June 30, 2018. During the twelve months ended September 30, 2016, the Company recorded revenue related to the expected accelerated recovery of a pension related entitlement from the federal government of approximately $50 million, which is included in accounts receivable-net at June 30, 2018. The entitlement resulted from pension costs that are reimbursable through government contracts in accordance with Cost Accounting Standards. The accelerated recognition resulted from an amendment to freeze pension benefits under URS Federal Services, Inc. Employees Retirement Plan. The actual amount of reimbursement may vary from the Company’s expectation. |
Reclassifications out of Accumu
Reclassifications out of Accumulated Other Comprehensive Loss | 9 Months Ended |
Jun. 30, 2018 | |
Reclassifications out of Accumulated Other Comprehensive Loss | |
Reclassifications out of Accumulated Other Comprehensive Loss | 13. Reclassifications out of Accumulated Other Comprehensive Loss The accumulated balances and reporting period activities for the three and nine months ended June 30, 2018 and 2017 related to reclassifications out of accumulated other comprehensive loss are summarized as follows (in millions): Pension Foreign Loss on Accumulated Balances at March 31, 2018 $ ) $ ) $ ) $ ) Other comprehensive income (loss) before reclassification ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2018 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at March 31, 2017 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassification ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2017 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at September 30, 2017 $ ) $ ) $ ) $ ) Other comprehensive loss before reclassification ) ) ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2018 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at September 30, 2016 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassification ) Amounts reclassified from accumulated other comprehensive income — Balances at June 30, 2017 $ ) $ ) $ ) $ ) |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | 14. Commitments and Contingencies The Company records amounts representing its probable estimated liabilities relating to claims, guarantees, litigation, audits and investigations. The Company relies in part on qualified actuaries to assist it in determining the level of reserves to establish for insurance-related claims that are known and have been asserted against it, and for insurance-related claims that are believed to have been incurred based on actuarial analysis, but have not yet been reported to the Company’s claims administrators as of the respective balance sheet dates. The Company includes any adjustments to such insurance reserves in its consolidated results of operations. The Company’s reasonably possible loss disclosures are presented on a gross basis prior to the consideration of insurance recoveries. The Company does not record gain contingencies until they are realized. In the ordinary course of business, the Company may not be aware that it or its affiliates are under investigation and may not be aware of whether or not a known investigation has been concluded. In the ordinary course of business, the Company may enter into various arrangements providing financial or performance assurance to clients, lenders, or partners. Such arrangements include standby letters of credit, surety bonds, and corporate guarantees to support the creditworthiness or the project execution commitments of its affiliates, partnerships and joint ventures. Performance arrangements typically have various expiration dates ranging from the completion of the project contract and extending beyond contract completion in some circumstances such as for warranties. The Company may also guarantee that a project, when complete, will achieve specified performance standards. If the project subsequently fails to meet guaranteed performance standards, the Company may incur additional costs, pay liquidated damages or be held responsible for the costs incurred by the client to achieve the required performance standards. The potential payment amount of an outstanding performance arrangement is typically the remaining cost of work to be performed by or on behalf of third parties. Generally, under joint venture arrangements, if a partner is financially unable to complete its share of the contract, the other partner(s) may be required to complete those activities. At June 30, 2018 and September 30, 2017, the Company was contingently liable in the amount of approximately $505.8 million and $503.8 million, respectively, in issued standby letters of credit and $5.5 billion and $5.7 billion, respectively, in issued surety bonds primarily to support project execution. In the ordinary course of business, the Company enters into various agreements providing financial or performance assurances to clients on behalf of certain unconsolidated partnerships, joint ventures and other jointly executed contracts. These agreements are entered into primarily to support the project execution commitments of these entities. In addition, in connection with the investment activities of AECOM Capital, the Company provides guarantees of contractual obligations, including guarantees for completion of projects, repayment of debt, environmental indemnity obligations and other lender required guarantees. DOE Deactivation, Demolition, and Removal Project Washington Group International, an Ohio company (WGI Ohio), an affiliate of URS, executed a cost-reimbursable task order with the Department of Energy (DOE) in 2007 to provide deactivation, demolition and removal services at a New York State project site that, during 2010, experienced contamination and performance issues and remains uncompleted. In February 2011, WGI Ohio and the DOE executed a Task Order Modification that changed some cost-reimbursable contract provisions to at-risk. The Task Order Modification, including subsequent amendments, requires the DOE to pay all project costs up to $106 million, requires WGI Ohio and the DOE to equally share in all project costs incurred from $106 million to $146 million, and requires WGI Ohio to pay all project costs exceeding $146 million. Due to unanticipated requirements and permitting delays by federal and state agencies, as well as delays and related ground stabilization activities caused by Hurricane Irene in 2011, WGI Ohio has been required to perform work outside the scope of the Task Order Modification. In December 2014, WGI Ohio submitted claims against the DOE pursuant to the Contracts Disputes Acts seeking recovery of $103 million, including additional fees on changed work scope. WGI Ohio has incurred and continues to incur additional project costs outside the scope of the contract as a result of differing site and ground conditions and intends to submit additional formal claims against the DOE. Due to significant delays and uncertainties about responsibilities for the scope of remaining work, final project completion costs and other associated costs have exceeded $100 million over the contracted and claimed amounts. WGI Ohio assets and liabilities, including the value of the above costs and claims, were measured at their fair value on October 17, 2014, the date AECOM acquired WGI Ohio’s parent company, see Note 3, which measurement has been reevaluated to account for developments pertaining to this matter. Deconstruction and decommissioning activities are nearing completion and WGI Ohio increased its receivable during the quarter ended June 30, 2018. WGI Ohio can provide no certainty that it will recover the claims submitted against DOE in December 2014, any future claims or any other project costs after December 2014 that WGI Ohio may be obligated to incur including the remaining project completion costs, which could have a material adverse effect on the Company’s results of operations. SR-91 One of the Company’s wholly-owned subsidiaries, URS Corporation, entered into a partial fixed cost and partial time and material design agreement in 2012 with a design build contractor for a state route highway construction project in Riverside County and Orange County, California. On April 1, 2017, URS Corporation filed an $8.2 million amended complaint in the Superior Court of California against the design build contractor for its failure to pay for services performed under the design agreement. On July 3, 2017, the design build contractor filed an amended cross-complaint against URS Corporation and AECOM in Superior Court alleging breaches of contract, negligent interference and professional negligence pertaining to URS Corporation’s performance of design services under the design agreement, seeking purported damages of $70 million. On May 4, 2018, the design build contractor dismissed its claims for negligent interference. On May 24, 2018, URS Corporation filed an $11.9 million second amended complaint in Superior Court against the design build contractor for its failure to pay for services performed under the design agreement. URS Corporation and AECOM cannot provide assurances that URS Corporation will be successful in the recovery of the amounts owed to it under the design agreement or in their defense against the amounts alleged under the cross-complaint that they believe are without merit and that they intend to vigorously defend against. The potential range of loss in excess of any current accrual cannot be reasonably estimated at this time, primarily because the matter involves complex factual and legal issues; there is substantial uncertainty regarding any alleged damages, including due to liability of and payments, by third parties; and the matter is at a discovery stage of litigation. New York Department of Environmental Conservation The following matter is disclosed pursuant to Regulation S-K, Item 103, Instruction 5.C pertaining to a government authority environmental claim exceeding $100,000 against an AECOM affiliate. In September 2017, AECOM USA, Inc., one of the Company’s wholly-owned subsidiaries, was advised by the New York State Department of Environmental Conservation (DEC) of allegations that it committed environmental permit violations pursuant to the New York Environmental Conservation Law (ECL) associated with AECOM USA, Inc.’s oversight of a stream restoration project for Schoharie County which could result in substantial penalties if calculated under the ECL’s maximum civil penalty provisions. AECOM USA, Inc. disputes this claim and intends to continue to defend this matter vigorously; however, AECOM USA, Inc., cannot provide assurances that it will be successful in these efforts. The potential range of loss in excess of any current accrual cannot be reasonably estimated at this time, primarily because the matter involves complex and unique environmental and regulatory issues; the project site involves the oversight and involvement of various local, state and federal government agencies; there is substantial uncertainty regarding any alleged damages; and the matter is in its preliminary stage of the government’s claims and any negotiations of a consent order or other resolution. Illinois Power Generating Company Advatech, LLC, a joint venture 60% owned by AECOM Energy & Construction, Inc., executed a fixed-cost engineering, procurement and construction contract for a flue-gas-desulfurization system at a coal-fired power plant owned by Illinois Power Generating Company, a wholly-owned subsidiary of Dynegy, Inc. (Genco). On September 2, 2016, Genco terminated Advatech’s contract for convenience and Advatech subsequently submitted its final contractual invoice of approximately $81 million. Advatech filed and perfected a mechanics lien on the Genco power plant property on October 17, 2016. On December 9, 2016, Genco filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas and its plan of reorganization was approved by the Bankruptcy Court on January 25, 2017 (the Bankruptcy Plan). Advatech’s contractual invoice and mechanics lien were not extinguished per the terms of the Bankruptcy Plan and remain outstanding claims. On March 15, 2017, Advatech filed a demand for arbitration and on July 21, 2017 submitted a Statement of Claim seeking reimbursement of approximately $81 million for Genco’s breach of contract and failure to reimburse Advatech for all of the cost of work performed under the contract. Advatech intends to vigorously prosecute this matter and seeks to collect all claimed amounts under the terms of the contract; however, Advatech cannot provide assurance that it will be successful in these efforts. The resolution of this matter and any potential range of loss in excess of any current accrual cannot be reasonably determined or estimated at this time, primarily because the matter has not been fully arbitrated and presents unique regulatory, bankruptcy and contractual interpretation issues. |
Reportable Segments
Reportable Segments | 9 Months Ended |
Jun. 30, 2018 | |
Reportable Segments | |
Reportable Segments | 15. Reportable Segments The Company’s operations are organized into four reportable segments: Design and Consulting Services (DCS), Construction Services (CS), Management Services (MS), and AECOM Capital (ACAP). During the third quarter of fiscal year 2017, operating activities of ACAP achieved a level of significance sufficient to warrant disclosure as a separate reportable segment. Prior to the third quarter of fiscal year 2017, ACAP’s operating results were included in the corporate segment, and comparable periods were reclassified to reflect the change. The Company’s DCS reportable segment delivers planning, consulting, architectural, environmental, and engineering design services to commercial and government clients worldwide. The Company’s CS reportable segment provides construction services primarily in the Americas. The Company’s MS reportable segment provides program and facilities management and maintenance, training, logistics, consulting, technical assistance, and systems integration and information technology services, primarily for agencies of the U.S. government. The Company’s ACAP segment invests in real estate, public-private partnership (P3) and infrastructure projects. These reportable segments are organized by the types of services provided, the differing specialized needs of the respective clients, and how the Company manages its business. The Company has aggregated various operating segments into its reportable segments based on their similar characteristics, including similar long term financial performance, the nature of services provided, internal processes for delivering those services, and types of customers. The following tables set forth summarized financial information concerning the Company’s reportable segments: Reportable Segments: Design and Construction Management AECOM Corporate Total (in millions) Three Months Ended June 30, 2018: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — — General and administrative expenses — — — ) ) ) Loss on disposal activities — ) — — — ) Operating income (loss) ) ) Gross profit as a % of revenue % % % — — % Three Months Ended June 30, 2017: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — General and administrative expenses — — — ) ) ) Operating income (loss) ) Gross profit as a % of revenue % % % — — % Reportable Segments: Design and Construction Management AECOM Corporate Total (in millions) Nine Months Ended June 30, 2018: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — — General and administrative expenses — — — ) ) ) Impairment of assets held for sale, including goodwill — ) — — — ) Loss on disposal activities — ) — — — ) Operating income (loss) ) ) ) Gross profit as a % of revenue % % % — — % Nine Months Ended June 30, 2017: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — General and administrative expenses — — — ) ) ) Acquisition and integration expenses — — — — ) ) Gain on disposal activities — — — — Operating income (loss) ) Gross profit as a % of revenue % % % — — % Reportable Segments: Total assets June 30, 2018 $ $ $ $ $ $ September 30, 2017 |
Condensed Consolidating Financi
Condensed Consolidating Financial Information | 9 Months Ended |
Jun. 30, 2018 | |
Condensed Consolidating Financial Information | |
Condensed Consolidating Financial Information | 16. Condensed Consolidating Financial Information In connection with the registration of the Company’s 2014 Senior Notes that were declared effective by the SEC on September 29, 2015, AECOM became subject to the requirements of Rule 3-10 of Regulation S-X regarding financial statements of guarantors and issuers of guaranteed securities. Both the 2014 Senior Notes and the 2017 Senior Notes are fully and unconditionally guaranteed on a joint and several basis by some of AECOM’s directly and indirectly 100% owned subsidiaries (the Subsidiary Guarantors). Other than customary restrictions imposed by applicable statutes, there are no restrictions on the ability of the Subsidiary Guarantors to transfer funds to AECOM in the form of cash dividends, loans or advances. The following condensed consolidating financial information, which is presented for AECOM, the Subsidiary Guarantors on a combined basis and AECOM’s non-guarantor subsidiaries on a combined basis, is provided to satisfy the disclosure requirements of Rule 3-10 of Regulation S-X. Condensed Consolidating Balance Sheets (unaudited — in millions) June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total ASSETS CURRENT ASSETS: Total cash and cash equivalents $ $ $ $ — $ Accounts receivable—net — — Intercompany receivable ) — Prepaid expenses and other current assets — Current assets held for sale — — — Income taxes receivable — — TOTAL CURRENT ASSETS ) PROPERTY AND EQUIPMENT—NET — DEFERRED TAX ASSETS—NET ) INVESTMENTS IN CONSOLIDATED SUBSIDIARIES — ) — INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES — GOODWILL — — INTANGIBLE ASSETS—NET — — OTHER NON-CURRENT ASSETS — TOTAL ASSETS $ $ $ $ ) $ LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Short-term debt $ $ — $ $ — $ Accounts payable — Accrued expenses and other current liabilities — Income taxes payable — — — Intercompany payable ) — Billings in excess of costs on uncompleted contracts — Current liabilities held for sale — — — Current portion of long-term debt — TOTAL CURRENT LIABILITIES ) OTHER LONG-TERM LIABILITIES — DEFERRED TAX LIABILITY—NET — — ) NOTE PAYABLE INTERCOMPANY—NON CURRENT — ) — LONG-TERM DEBT — TOTAL LIABILITIES ) TOTAL AECOM STOCKHOLDERS’ EQUITY ) Noncontrolling interests — — — TOTAL STOCKHOLDERS’ EQUITY ) TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ $ $ $ ) $ Condensed Consolidating Balance Sheets (unaudited - in millions) September 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total ASSETS CURRENT ASSETS: Total cash and cash equivalents $ $ $ $ — $ Accounts receivable—net — — Intercompany receivable ) — Prepaid expenses and other current assets — Income taxes receivable — — TOTAL CURRENT ASSETS ) PROPERTY AND EQUIPMENT—NET — DEFERRED TAX ASSETS—NET ) INVESTMENTS IN CONSOLIDATED SUBSIDIARIES — ) — INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES — GOODWILL — — INTANGIBLE ASSETS—NET — — OTHER NON-CURRENT ASSETS — TOTAL ASSETS $ $ $ $ ) $ LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Short-term debt $ $ — $ $ — $ Accounts payable — Accrued expenses and other current liabilities — Income taxes payable — — Intercompany payable ) — Billings in excess of costs on uncompleted contracts — Current portion of long-term debt — TOTAL CURRENT LIABILITIES ) OTHER LONG-TERM LIABILITIES — DEFERRED TAX LIABILITY—NET — ) NOTE PAYABLE INTERCOMPANY—NON CURRENT — ) — LONG-TERM DEBT — TOTAL LIABILITIES ) TOTAL AECOM STOCKHOLDERS’ EQUITY ) Noncontrolling interests — — — TOTAL STOCKHOLDERS’ EQUITY ) TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ $ $ $ ) $ Condensed Consolidating Statements of Operations (unaudited - in millions) For the three months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Loss on disposal activities — — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ For the three months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ Condensed Consolidating Statements of Operations (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Impairment of assets held for sale, including goodwill — — ) — ) Loss on disposal activities — — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) (Loss) income before income tax (benefit) expense ) ) Income tax (benefit) expense ) ) — ) Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ For the nine months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Acquisition and integration expenses ) — — — ) Gain on disposal activities — — — Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ Consolidating Statements of Comprehensive Income (Loss) (unaudited - in millions) For the three months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income (loss), net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — Foreign currency translation adjustments — — ) — ) Pension adjustments, net of tax — — Other comprehensive income (loss), net of tax — ) — ) Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income (loss) attributable to AECOM, net of tax $ $ $ ) $ ) $ For the three months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income, net of tax: Net unrealized gain on derivatives, net of tax — — Foreign currency translation adjustments — — — Pension adjustments, net of tax — ) — ) Other comprehensive income, net of tax — — Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income attributable to AECOM, net of tax $ $ $ $ ) $ Consolidating Statements of Comprehensive Income (Loss) (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income (loss), net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — ) Foreign currency translation adjustments — — ) — ) Pension adjustments, net of tax — ) — Other comprehensive income (loss), net of tax — ) — ) Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income (loss) attributable to AECOM, net of tax $ $ $ $ ) $ ) For the nine months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income, net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — Foreign currency translation adjustments — — — Pension adjustments, net of tax — — Other comprehensive income, net of tax — — Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income attributable to AECOM, net of tax $ $ $ $ ) $ Condensed Consolidating Statements of Cash Flows (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non- Eliminations Total CASH FLOWS FROM OPERATING ACTIVITIES $ ) $ $ $ — $ CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from purchase price adjustment to business acquisition — — — Cash acquired from consolidation of joint venture — — — Proceeds from disposal of business, net of cash disposed — — — Net investment in unconsolidated joint ventures ) ) ) — ) Net payments for purchase of investments — — ) — ) Payments for capital expenditures, net of disposals ) ) ) — ) Net investment in intercompany notes ) ) ) — Other intercompany investing activities — ) — Net cash used in investing activities ) ) ) ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from borrowings under credit agreements — — Repayments of borrowings under credit agreements ) ) ) — ) Redemption of unsecured senior notes ) — — — ) Prepayment premium on redemption of unsecured senior notes ) — — — ) Cash paid for debt issuance costs ) — — — ) Proceeds from issuance of common stock — — — Proceeds from exercise of stock options — — — Payments to repurchase common stock ) — — — ) Net distributions to noncontrolling interests — — ) — ) Other financing activities ) — Net borrowings (repayments) on intercompany notes ) ) — Other intercompany financing activities — ) ) — Net cash provided by (used in) financing activities ) ) ) EFFECT OF EXCHANGE RATE CHANGES ON CASH — — ) — ) NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ) ) — ) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR — CASH AND CASH EQUIVALENTS AT END OF YEAR $ $ $ $ — $ Condensed Consolidating Statements of Cash Flows (unaudited - in millions) For the nine months ended June 30, 2017 Parent Guarantor Non- Eliminations Total CASH FLOWS FROM OPERATING ACTIVITIES $ ) $ $ $ — $ CASH FLOWS FROM INVESTING ACTIVITIES: Payment for business acquisitions, net of cash acquired — — ) — ) Proceeds from disposal of business, net of cash disposed — — — Net investment in unconsolidated joint ventures — ) — ) Net proceeds from sale of investments — — — Payments for capital expenditures, net of disposals ) ) ) — ) Net investment in intercompany notes ) ) ) — Other intercompany investing activities ) — ) — Net cash provided by (used in) investing activities ) ) ) ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from borrowings under credit agreements — — Repayments of borrowings under credit agreements ) ) ) — ) Proceeds from issuance of unsecured senior notes — — — Redemption of unsecured senior notes — ) — — ) Cash paid for debt issuance costs ) — — — ) Proceeds from issuance of common stock — — — Proceeds from exercise of stock options — — — Payments to repurchase common stock ) — — — ) Net distributions to noncontrolling interests — — ) — ) Other financing activities ) ) — ) Net borrowings (repayments) on intercompany notes ) ) — Other intercompany financing activities — ) — Net cash provided by (used in) financing activities ) ) EFFECT OF EXCHANGE RATE CHANGES ON CASH — — ) — ) NET INCREASE IN CASH AND CASH EQUIVALENTS — CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR — CASH AND CASH EQUIVALENTS AT END OF YEAR $ $ $ $ — $ |
Business Acquisitions, Goodwi23
Business Acquisitions, Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Business Acquisitions, Goodwill and Intangible Assets | |
Schedule of acquisition and integration expenses | Nine months ended (in millions) Severance and personnel costs $ Professional service, real estate-related, and other expenses Total $ |
Schedule of changes in the carrying value of goodwill by reportable segment | September 30, Measurement Impairment Foreign June 30, (in millions) Design and Consulting Services $ $ — $ — $ ) $ Construction Services ) ) Management Services — — Total $ $ $ ) $ ) $ |
Schedule of finite-lived intangible assets by major class | June 30, 2018 September 30, 2017 Gross Accumulated Intangible Gross Accumulated Intangible Amortization (in millions) (years) Backlog and customer relationships $ $ ) $ $ $ ) $ 1 - 11 Trademark / tradename ) ) 0.3 - 2 Total $ $ ) $ $ $ ) $ |
Schedule of estimated future amortization expense of intangible assets | Fiscal Year (in millions) 2018 (three months remaining) $ 2019 2020 2021 2022 Thereafter Total $ |
Accounts Receivable - Net (Tabl
Accounts Receivable - Net (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Accounts Receivable - Net | |
Schedule of net accounts receivable | June 30, September 30, (in millions) Billed $ $ Unbilled Contract retentions Total accounts receivable—gross Allowance for doubtful accounts ) ) Total accounts receivable—net $ $ |
Joint Ventures and Variable I25
Joint Ventures and Variable Interest Entities (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Joint Ventures and Variable Interest Entities | |
Summary of unaudited financial information of the consolidated joint ventures | June 30, September 30, (in millions) Current assets $ $ Non-current assets Total assets $ $ Current liabilities $ $ Non-current liabilities Total liabilities Total AECOM equity Noncontrolling interests Total owners’ equity Total liabilities and owners’ equity $ $ |
Summary of unaudited financial information of the unconsolidated joint ventures | June 30, September 30, (in millions) Current assets $ $ Non-current assets Total assets $ $ Current liabilities $ $ Non-current liabilities Total liabilities Joint ventures’ equity Total liabilities and joint ventures’ equity $ $ AECOM’s investment in joint ventures $ $ Nine Months Ended June 30, June 30, (in millions) Revenue $ $ Cost of revenue Gross profit $ $ Net income $ $ |
Summary of AECOM's equity in earnings of unconsolidated joint ventures | Nine Months Ended June 30, June 30, (in millions) Pass through joint ventures $ $ Other joint ventures Total $ $ |
Pension Benefit Obligations (Ta
Pension Benefit Obligations (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Pension Benefit Obligations | |
Components of net periodic cost for the Company's pension plans | Three Months Ended Nine Months Ended June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 U.S. Int’l U.S. Int’l U.S. Int’l U.S. Int’l (in millions) Components of net periodic (benefit) cost: Service costs $ $ $ $ $ $ $ $ Interest cost on projected benefit obligation Expected return on plan assets ) ) ) ) ) ) ) ) Amortization of prior service cost — — — — — ) — ) Amortization of net loss Settlement loss recognized — — — — — — — Net periodic (benefit) cost $ ) $ ) $ ) $ $ ) $ ) $ ) $ |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Debt | |
Schedule of debt | June 30, September 30, (in millions) 2014 Credit Agreement $ $ 2014 Senior Notes 2017 Senior Notes URS Senior Notes Other debt Total debt Less: Current portion of debt and short-term borrowings ) ) Less: Unamortized debt issuance costs ) ) Long-term debt $ $ |
Schedule of maturities of debt | Fiscal Year 2018 (three months remaining) $ 2019 2020 2021 2022 Thereafter Total $ |
Derivative Financial Instrume28
Derivative Financial Instruments and Fair Value Measurements (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Derivative Financial Instruments and Fair Value Measurements | |
Notional principle, fixed rates and related expiration dates of outstanding interest rate swap agreements | June 30, 2018 Notional Amount Notional Amount Fixed Expiration USD % September 2018 AUD % February 2021 CAD % September 2022 USD % February 2023 September 30, 2017 Notional Amount Notional Amount Fixed Expiration USD % June 2018 USD % September 2018 |
Share-based Payments (Tables)
Share-based Payments (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Share-based Payments | |
Schedule of stock option activity | Stock option activity for the nine months ended June 30 was as follows: 2018 2017 Shares of stock Weighted average Shares of stock Weighted average (in millions) (in millions) Outstanding at September 30, prior year $ $ Options granted — — — — Options exercised ) ) Options forfeited or expired — — — — Outstanding at June 30 Vested and expected to vest in the future as of June 30 $ $ |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share | |
Reconciliation of the denominators for basic and diluted EPS | Three Months Ended Nine Months Ended June 30, June 30, June 30, June 30, (in millions) Denominator for basic earnings per share Potential common shares Denominator for diluted earnings per share |
Other Financial Information (Ta
Other Financial Information (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Other Financial Information | |
Schedule of accrued expenses and other current liabilities | June 30, September 30, (in millions) Accrued salaries and benefits $ $ Accrued contract costs Other accrued expenses $ $ |
Reclassifications out of Accu32
Reclassifications out of Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Reclassifications out of Accumulated Other Comprehensive Loss | |
Schedule of accumulated balances and reporting period activities related to reclassifications out of accumulated other comprehensive loss | The accumulated balances and reporting period activities for the three and nine months ended June 30, 2018 and 2017 related to reclassifications out of accumulated other comprehensive loss are summarized as follows (in millions): Pension Foreign Loss on Accumulated Balances at March 31, 2018 $ ) $ ) $ ) $ ) Other comprehensive income (loss) before reclassification ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2018 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at March 31, 2017 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassification ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2017 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at September 30, 2017 $ ) $ ) $ ) $ ) Other comprehensive loss before reclassification ) ) ) ) Amounts reclassified from accumulated other comprehensive loss — Balances at June 30, 2018 $ ) $ ) $ ) $ ) Pension Foreign Loss on Accumulated Balances at September 30, 2016 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassification ) Amounts reclassified from accumulated other comprehensive income — Balances at June 30, 2017 $ ) $ ) $ ) $ ) |
Reportable Segments (Tables)
Reportable Segments (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Reportable Segments | |
Summarized financial information concerning the Company's reportable segments | Reportable Segments: Design and Construction Management AECOM Corporate Total (in millions) Three Months Ended June 30, 2018: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — — General and administrative expenses — — — ) ) ) Loss on disposal activities — ) — — — ) Operating income (loss) ) ) Gross profit as a % of revenue % % % — — % Three Months Ended June 30, 2017: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — General and administrative expenses — — — ) ) ) Operating income (loss) ) Gross profit as a % of revenue % % % — — % Reportable Segments: Design and Construction Management AECOM Corporate Total (in millions) Nine Months Ended June 30, 2018: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — — General and administrative expenses — — — ) ) ) Impairment of assets held for sale, including goodwill — ) — — — ) Loss on disposal activities — ) — — — ) Operating income (loss) ) ) ) Gross profit as a % of revenue % % % — — % Nine Months Ended June 30, 2017: Revenue $ $ $ $ — $ — $ Gross profit — — Equity in earnings of joint ventures — General and administrative expenses — — — ) ) ) Acquisition and integration expenses — — — — ) ) Gain on disposal activities — — — — Operating income (loss) ) Gross profit as a % of revenue % % % — — % Reportable Segments: Total assets June 30, 2018 $ $ $ $ $ $ September 30, 2017 |
Condensed Consolidating Finan34
Condensed Consolidating Financial Information (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Condensed Consolidating Financial Information | |
Schedule of Condensed Consolidating Balance Sheets | Condensed Consolidating Balance Sheets (unaudited — in millions) June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total ASSETS CURRENT ASSETS: Total cash and cash equivalents $ $ $ $ — $ Accounts receivable—net — — Intercompany receivable ) — Prepaid expenses and other current assets — Current assets held for sale — — — Income taxes receivable — — TOTAL CURRENT ASSETS ) PROPERTY AND EQUIPMENT—NET — DEFERRED TAX ASSETS—NET ) INVESTMENTS IN CONSOLIDATED SUBSIDIARIES — ) — INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES — GOODWILL — — INTANGIBLE ASSETS—NET — — OTHER NON-CURRENT ASSETS — TOTAL ASSETS $ $ $ $ ) $ LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Short-term debt $ $ — $ $ — $ Accounts payable — Accrued expenses and other current liabilities — Income taxes payable — — — Intercompany payable ) — Billings in excess of costs on uncompleted contracts — Current liabilities held for sale — — — Current portion of long-term debt — TOTAL CURRENT LIABILITIES ) OTHER LONG-TERM LIABILITIES — DEFERRED TAX LIABILITY—NET — — ) NOTE PAYABLE INTERCOMPANY—NON CURRENT — ) — LONG-TERM DEBT — TOTAL LIABILITIES ) TOTAL AECOM STOCKHOLDERS’ EQUITY ) Noncontrolling interests — — — TOTAL STOCKHOLDERS’ EQUITY ) TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ $ $ $ ) $ Condensed Consolidating Balance Sheets (unaudited - in millions) September 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total ASSETS CURRENT ASSETS: Total cash and cash equivalents $ $ $ $ — $ Accounts receivable—net — — Intercompany receivable ) — Prepaid expenses and other current assets — Income taxes receivable — — TOTAL CURRENT ASSETS ) PROPERTY AND EQUIPMENT—NET — DEFERRED TAX ASSETS—NET ) INVESTMENTS IN CONSOLIDATED SUBSIDIARIES — ) — INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES — GOODWILL — — INTANGIBLE ASSETS—NET — — OTHER NON-CURRENT ASSETS — TOTAL ASSETS $ $ $ $ ) $ LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Short-term debt $ $ — $ $ — $ Accounts payable — Accrued expenses and other current liabilities — Income taxes payable — — Intercompany payable ) — Billings in excess of costs on uncompleted contracts — Current portion of long-term debt — TOTAL CURRENT LIABILITIES ) OTHER LONG-TERM LIABILITIES — DEFERRED TAX LIABILITY—NET — ) NOTE PAYABLE INTERCOMPANY—NON CURRENT — ) — LONG-TERM DEBT — TOTAL LIABILITIES ) TOTAL AECOM STOCKHOLDERS’ EQUITY ) Noncontrolling interests — — — TOTAL STOCKHOLDERS’ EQUITY ) TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ $ $ $ ) $ |
Schedule of Condensed Consolidating Statements of Operations | Condensed Consolidating Statements of Operations (unaudited - in millions) For the three months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Loss on disposal activities — — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ For the three months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ Condensed Consolidating Statements of Operations (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Impairment of assets held for sale, including goodwill — — ) — ) Loss on disposal activities — — ) — ) Income from operations ) Other income ) Interest expense ) ) ) ) (Loss) income before income tax (benefit) expense ) ) Income tax (benefit) expense ) ) — ) Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ For the nine months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Revenue $ — $ $ $ ) $ Cost of revenue — ) Gross profit — — Equity in earnings from subsidiaries — ) — Equity in earnings of joint ventures — — General and administrative expenses ) — ) — ) Acquisition and integration expenses ) — — — ) Gain on disposal activities — — — Income from operations ) Other income ) Interest expense ) ) ) ) Income before income tax (benefit) expense ) Income tax (benefit) expense ) — Net income ) Noncontrolling interest in income of consolidated subsidiaries, net of tax — — ) — ) Net income attributable to AECOM $ $ $ $ ) $ |
Schedule of Consolidating Statements of Comprehensive Income (Loss) | Consolidating Statements of Comprehensive Income (Loss) (unaudited - in millions) For the three months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income (loss), net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — Foreign currency translation adjustments — — ) — ) Pension adjustments, net of tax — — Other comprehensive income (loss), net of tax — ) — ) Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income (loss) attributable to AECOM, net of tax $ $ $ ) $ ) $ For the three months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income, net of tax: Net unrealized gain on derivatives, net of tax — — Foreign currency translation adjustments — — — Pension adjustments, net of tax — ) — ) Other comprehensive income, net of tax — — Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income attributable to AECOM, net of tax $ $ $ $ ) $ Consolidating Statements of Comprehensive Income (Loss) (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income (loss), net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — ) Foreign currency translation adjustments — — ) — ) Pension adjustments, net of tax — ) — Other comprehensive income (loss), net of tax — ) — ) Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income (loss) attributable to AECOM, net of tax $ $ $ $ ) $ ) For the nine months ended June 30, 2017 Parent Guarantor Non-Guarantor Eliminations Total Net income $ $ $ $ ) $ Other comprehensive income, net of tax: Net unrealized gain (loss) on derivatives, net of tax — ) — Foreign currency translation adjustments — — — Pension adjustments, net of tax — — Other comprehensive income, net of tax — — Comprehensive income, net of tax ) Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax — — ) — ) Comprehensive income attributable to AECOM, net of tax $ $ $ $ ) $ |
Schedule on Condensed Consolidating Statements of Cash Flows | Condensed Consolidating Statements of Cash Flows (unaudited - in millions) For the nine months ended June 30, 2018 Parent Guarantor Non- Eliminations Total CASH FLOWS FROM OPERATING ACTIVITIES $ ) $ $ $ — $ CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from purchase price adjustment to business acquisition — — — Cash acquired from consolidation of joint venture — — — Proceeds from disposal of business, net of cash disposed — — — Net investment in unconsolidated joint ventures ) ) ) — ) Net payments for purchase of investments — — ) — ) Payments for capital expenditures, net of disposals ) ) ) — ) Net investment in intercompany notes ) ) ) — Other intercompany investing activities — ) — Net cash used in investing activities ) ) ) ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from borrowings under credit agreements — — Repayments of borrowings under credit agreements ) ) ) — ) Redemption of unsecured senior notes ) — — — ) Prepayment premium on redemption of unsecured senior notes ) — — — ) Cash paid for debt issuance costs ) — — — ) Proceeds from issuance of common stock — — — Proceeds from exercise of stock options — — — Payments to repurchase common stock ) — — — ) Net distributions to noncontrolling interests — — ) — ) Other financing activities ) — Net borrowings (repayments) on intercompany notes ) ) — Other intercompany financing activities — ) ) — Net cash provided by (used in) financing activities ) ) ) EFFECT OF EXCHANGE RATE CHANGES ON CASH — — ) — ) NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ) ) — ) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR — CASH AND CASH EQUIVALENTS AT END OF YEAR $ $ $ $ — $ Condensed Consolidating Statements of Cash Flows (unaudited - in millions) For the nine months ended June 30, 2017 Parent Guarantor Non- Eliminations Total CASH FLOWS FROM OPERATING ACTIVITIES $ ) $ $ $ — $ CASH FLOWS FROM INVESTING ACTIVITIES: Payment for business acquisitions, net of cash acquired — — ) — ) Proceeds from disposal of business, net of cash disposed — — — Net investment in unconsolidated joint ventures — ) — ) Net proceeds from sale of investments — — — Payments for capital expenditures, net of disposals ) ) ) — ) Net investment in intercompany notes ) ) ) — Other intercompany investing activities ) — ) — Net cash provided by (used in) investing activities ) ) ) ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from borrowings under credit agreements — — Repayments of borrowings under credit agreements ) ) ) — ) Proceeds from issuance of unsecured senior notes — — — Redemption of unsecured senior notes — ) — — ) Cash paid for debt issuance costs ) — — — ) Proceeds from issuance of common stock — — — Proceeds from exercise of stock options — — — Payments to repurchase common stock ) — — — ) Net distributions to noncontrolling interests — — ) — ) Other financing activities ) ) — ) Net borrowings (repayments) on intercompany notes ) ) — Other intercompany financing activities — ) — Net cash provided by (used in) financing activities ) ) EFFECT OF EXCHANGE RATE CHANGES ON CASH — — ) — ) NET INCREASE IN CASH AND CASH EQUIVALENTS — CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR — CASH AND CASH EQUIVALENTS AT END OF YEAR $ $ $ $ — $ |
Basis of Presentation (Details)
Basis of Presentation (Details) | 9 Months Ended |
Jun. 30, 2018 | |
Minimum | |
Length of fiscal year | 364 days |
Maximum | |
Length of fiscal year | 371 days |
Business Acquisitions, Goodwi36
Business Acquisitions, Goodwill and Intangible Assets - URS Acquisition (Details) $ in Millions | Oct. 17, 2014USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)item | Jun. 30, 2017USD ($) | Sep. 30, 2017USD ($)item |
Business acquisition | ||||||
Number of acquisition | item | 1 | 2 | ||||
Total consideration | $ 5.6 | $ 164.4 | ||||
URS | ||||||
Business acquisition | ||||||
Ownership acquired (in percent) | 100.00% | |||||
Total consideration | $ 2,300 | |||||
Consideration paid by issuing stock | 1,600 | |||||
Senior notes assumed, net of Company repayments | 400 | |||||
Repayment of acquiree term loan as part of consideration | 600 | |||||
Repayment of acquiree line of credit as part of consideration | 100 | |||||
Accrued expenses and other current liabilities | 240 | |||||
Amortization of intangible assets of acquiree for the period | $ 16 | $ 20.9 | 52.4 | $ 62.7 | ||
Fair value adjustment of joint ventures | 1.7 | 2.4 | 5.3 | 6.9 | ||
Fair value adjustment of noncontrolling interests | (2) | (2.1) | (6.2) | $ (6.4) | ||
Fair value of margin liability | 24.1 | $ 24.1 | $ 8.6 | |||
Income from operations related to margin fair value liability | $ 8.1 | $ 1.6 | ||||
URS | Customer relationships, contracts and backlog | ||||||
Business acquisition | ||||||
Acquired backlog and customer relationship assets | $ 973.8 | |||||
URS | Customer relationships, contracts and backlog | Minimum | ||||||
Business acquisition | ||||||
Useful life (in years) | 1 year | |||||
URS | Customer relationships, contracts and backlog | Maximum | ||||||
Business acquisition | ||||||
Useful life (in years) | 11 years | |||||
URS | Customer relationships, contracts and backlog | Weighted Average | ||||||
Business acquisition | ||||||
Useful life (in years) | 3 years |
Business Acquisitions, Goodwi37
Business Acquisitions, Goodwill and Intangible Assets - Expenses (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2017USD ($) | |
Business Acquisitions, Goodwill and Intangible Assets | |
Severance and personnel costs | $ 29,900 |
Professional service, real estate-related, and other expenses | 5,500 |
Total | 35,409 |
Severance expense | $ 7,700 |
Business Acquisitions, Goodwi38
Business Acquisitions, Goodwill and Intangible Assets - Disposal Group (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Classification of related assets and liabilities of the Disposal Group as held for sale in the consolidated balance sheet | |||
Loss on disposal of portion of assets in the disposal group | $ 2,149 | $ 2,149 | $ (572) |
Impairment of goodwill | 125,400 | ||
Summary of financial information of the Disposal Group is as follows: | |||
Impairment of assets held for sale, including goodwill | 168,178 | ||
Construction Services | Disposal Group as held for sale | |||
Classification of related assets and liabilities of the Disposal Group as held for sale in the consolidated balance sheet | |||
Loss on disposal of portion of assets in the disposal group | 2,100 | ||
Impairment of goodwill | 125,400 | ||
Impairment of intangible and other noncurrent assets | 42,800 | ||
Accounts receivable included in Current assets held for sale | 48,000 | 48,000 | |
Property plant and equipment included in Current assets held for sale | 14,300 | 14,300 | |
Accounts payable included in Current liabilities held for sale | $ 12,600 | $ 12,600 |
Business Acquisitions, Goodwi39
Business Acquisitions, Goodwill and Intangible Assets - Goodwill (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2018USD ($) | |
Changes in the carrying value of goodwill by reporting segment | |
Goodwill at the beginning of the period | $ 5,992,881 |
Measurement period adjustments | 91,000 |
Impairment | (125,400) |
Foreign Exchange Impact | (30,500) |
Goodwill at the end of the period | 5,928,029 |
Design and Consulting Services | |
Changes in the carrying value of goodwill by reporting segment | |
Goodwill at the beginning of the period | 3,218,900 |
Foreign Exchange Impact | (24,100) |
Goodwill at the end of the period | 3,194,800 |
Construction Services | |
Changes in the carrying value of goodwill by reporting segment | |
Goodwill at the beginning of the period | 1,049,900 |
Measurement period adjustments | 91,000 |
Impairment | (125,400) |
Foreign Exchange Impact | (8,700) |
Goodwill at the end of the period | 1,006,800 |
Management Services | |
Changes in the carrying value of goodwill by reporting segment | |
Goodwill at the beginning of the period | 1,724,100 |
Foreign Exchange Impact | 2,300 |
Goodwill at the end of the period | $ 1,726,400 |
Business Acquisitions, Goodwi40
Business Acquisitions, Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Sep. 30, 2017 | |
Identifiable intangible assets with finite useful lives | ||
Gross Amount | $ 1,305,000 | $ 1,301,900 |
Accumulated Amortization | (961,800) | (886,800) |
Intangible Assets, Net | 343,185 | 415,096 |
Backlog and customer relationships | ||
Identifiable intangible assets with finite useful lives | ||
Gross Amount | 1,286,700 | 1,283,600 |
Accumulated Amortization | (945,000) | (870,200) |
Intangible Assets, Net | $ 341,700 | 413,400 |
Backlog and customer relationships | Minimum | ||
Identifiable intangible assets with finite useful lives | ||
Amortization Period | 1 year | |
Backlog and customer relationships | Maximum | ||
Identifiable intangible assets with finite useful lives | ||
Amortization Period | 11 years | |
Trademark / tradename | ||
Identifiable intangible assets with finite useful lives | ||
Gross Amount | $ 18,300 | 18,300 |
Accumulated Amortization | (16,800) | (16,600) |
Intangible Assets, Net | $ 1,500 | $ 1,700 |
Trademark / tradename | Minimum | ||
Identifiable intangible assets with finite useful lives | ||
Amortization Period | 3 months 18 days | |
Trademark / tradename | Maximum | ||
Identifiable intangible assets with finite useful lives | ||
Amortization Period | 2 years |
Business Acquisitions, Goodwi41
Business Acquisitions, Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | |
Business Acquisitions, Goodwill and Intangible Assets | |||
Amortization expense | $ 75,000 | $ 76,500 | |
Estimated amortization expense for the remainder of fiscal 2018 and for the succeeding years | |||
2018 (three months remaining) | 22,700 | ||
2,019 | 83,900 | ||
2,020 | 70,000 | ||
2,021 | 56,900 | ||
2,022 | 44,100 | ||
Thereafter | 65,600 | ||
Intangible Assets, Net | $ 343,185 | $ 415,096 |
Accounts Receivable - Net (Deta
Accounts Receivable - Net (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Sep. 30, 2017 | |
Billed | $ 2,560,600 | $ 2,317,800 |
Unbilled | 2,295,000 | 2,293,500 |
Contract retentions | 638,900 | 568,600 |
Total accounts receivable-gross | 5,494,500 | 5,179,900 |
Allowance for doubtful accounts | (46,500) | (52,200) |
Total accounts receivable-net | $ 5,447,985 | $ 5,127,743 |
Additional disclosures | ||
Unbilled receivables are expected to be billed and collected (in months) | 12 months | 12 months |
Trade receivables sold, outstanding | $ 342,700 | $ 325,200 |
Other than U.S government outstanding receivables | ||
Additional disclosures | ||
Number of Customers | 0 | 0 |
Outstanding receivables (as a percent) | 10.00% | 10.00% |
Joint Ventures and Variable I43
Joint Ventures and Variable Interest Entities - Consolidated (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018USD ($)employee | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)employee | Jun. 30, 2017USD ($) | Sep. 30, 2017USD ($) | |
Financial Information | |||||
Minimum number of employees | employee | 0 | 0 | |||
Current assets | $ 7,043,842 | $ 7,043,842 | $ 6,682,222 | ||
TOTAL ASSETS | 14,727,417 | 14,727,417 | 14,396,956 | ||
Current liabilities | 5,890,070 | 5,890,070 | 5,578,379 | ||
TOTAL LIABILITIES | 10,467,283 | 10,467,283 | 10,182,270 | ||
Total AECOM equity | 4,077,732 | 4,077,732 | 3,996,126 | ||
Noncontrolling interests | 182,402 | 182,402 | 218,560 | ||
TOTAL STOCKHOLDERS' EQUITY | 4,260,134 | 4,260,134 | 4,214,686 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 14,727,417 | 14,727,417 | 14,396,956 | ||
Joint ventures summarized financial information | |||||
Revenue | 5,147,920 | $ 4,561,467 | 14,849,662 | $ 13,347,014 | |
Consolidated Joint Ventures | |||||
Financial Information | |||||
Current assets | 906,000 | 906,000 | 832,100 | ||
Non-current assets | 198,400 | 198,400 | 188,800 | ||
TOTAL ASSETS | 1,104,400 | 1,104,400 | 1,020,900 | ||
Current liabilities | 638,200 | 638,200 | 524,900 | ||
Non-current liabilities | 12,300 | 12,300 | 12,400 | ||
TOTAL LIABILITIES | 650,500 | 650,500 | 537,300 | ||
Total AECOM equity | 272,100 | 272,100 | 274,700 | ||
Noncontrolling interests | 181,800 | 181,800 | 208,900 | ||
TOTAL STOCKHOLDERS' EQUITY | 453,900 | 453,900 | 483,600 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,104,400 | 1,104,400 | $ 1,020,900 | ||
Joint ventures summarized financial information | |||||
Revenue | $ 1,820,800 | $ 1,457,000 |
Joint Ventures and Variable I44
Joint Ventures and Variable Interest Entities - Unconsolidated (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | |
Financial Information | |||||
Current assets | $ 7,043,842 | $ 7,043,842 | $ 6,682,222 | ||
TOTAL ASSETS | 14,727,417 | 14,727,417 | 14,396,956 | ||
Current liabilities | 5,890,070 | 5,890,070 | 5,578,379 | ||
TOTAL LIABILITIES | 10,467,283 | 10,467,283 | 10,182,270 | ||
TOTAL STOCKHOLDERS' EQUITY | 4,260,134 | 4,260,134 | 4,214,686 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 14,727,417 | 14,727,417 | 14,396,956 | ||
AECOM's investment in joint ventures | 398,134 | 398,134 | 364,223 | ||
Joint ventures summarized financial information | |||||
Revenue | 5,147,920 | $ 4,561,467 | 14,849,662 | $ 13,347,014 | |
Cost of revenue | 4,962,741 | 4,386,291 | 14,387,059 | 12,833,421 | |
Gross profit | 185,179 | 175,176 | 462,603 | 513,593 | |
Net income | 75,142 | $ 136,074 | 91,800 | 317,692 | |
Unconsolidated Joint Ventures | |||||
Financial Information | |||||
Current assets | 1,759,000 | 1,759,000 | 1,912,200 | ||
Non-current assets | 896,500 | 896,500 | 749,800 | ||
TOTAL ASSETS | 2,655,500 | 2,655,500 | 2,662,000 | ||
Current liabilities | 1,381,600 | 1,381,600 | 1,570,200 | ||
Non-current liabilities | 223,000 | 223,000 | 185,100 | ||
TOTAL LIABILITIES | 1,604,600 | 1,604,600 | 1,755,300 | ||
TOTAL STOCKHOLDERS' EQUITY | 1,050,900 | 1,050,900 | 906,700 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 2,655,500 | 2,655,500 | 2,662,000 | ||
AECOM's investment in joint ventures | $ 398,100 | 398,100 | $ 364,200 | ||
Joint ventures summarized financial information | |||||
Revenue | 4,041,700 | 4,077,700 | |||
Cost of revenue | 3,843,700 | 3,862,900 | |||
Gross profit | 198,000 | 214,800 | |||
Net income | $ 191,800 | $ 205,300 |
Joint Ventures and Variable I45
Joint Ventures and Variable Interest Entities - Equity in Earnings (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Financial Information | ||||
Equity in earnings of joint ventures | $ 12,863 | $ 66,458 | $ 55,621 | $ 109,667 |
Unconsolidated Joint Ventures | Pass through joint ventures | ||||
Financial Information | ||||
Equity in earnings of joint ventures | 29,800 | 27,500 | ||
Unconsolidated Joint Ventures | Other Joint Ventures | ||||
Financial Information | ||||
Equity in earnings of joint ventures | $ 25,800 | $ 82,200 |
Pension Benefit Obligations (De
Pension Benefit Obligations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
United States Pension Plan of US Entity, Defined Benefit | ||||
Components of net periodic (benefit) cost: | ||||
Service costs | $ 1.3 | $ 1 | $ 3.7 | $ 3.2 |
Interest cost on projected benefit obligation | 5.1 | 4.8 | 15.5 | 14.4 |
Expected return on plan assets | (7.9) | (7.7) | (23.6) | (23.2) |
Amortization of net loss | 1 | 1 | 3 | 3.2 |
Net periodic (benefit) cost | (0.5) | (0.9) | (1.4) | (2.4) |
Change in benefit obligation: | ||||
Employer contributions | 6.6 | |||
Expected remaining scheduled annual employer contributions for the current fiscal year | 5.2 | 5.2 | ||
Foreign Pension Plan, Defined Benefit | ||||
Components of net periodic (benefit) cost: | ||||
Service costs | 0.2 | 0.3 | 0.8 | 0.9 |
Interest cost on projected benefit obligation | 8.1 | 7.1 | 24.3 | 21 |
Expected return on plan assets | (10.8) | (10.5) | (32.6) | (30.8) |
Amortization of prior service cost | (0.1) | (0.1) | ||
Amortization of net loss | 2 | 3.3 | 6.2 | 9.7 |
Settlement loss recognized | 0.2 | |||
Net periodic (benefit) cost | (0.5) | $ 0.2 | (1.2) | $ 0.7 |
Change in benefit obligation: | ||||
Employer contributions | 21.1 | |||
Expected remaining scheduled annual employer contributions for the current fiscal year | $ 6.2 | $ 6.2 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 | Oct. 17, 2014 |
Debt | |||
Total debt | $ 3,929,800 | $ 3,896,400 | |
Less: Current portion of debt and short-term borrowings | (173,000) | (142,000) | |
Less: Unamortized debt issuance costs | (49,500) | (52,300) | |
Long-term debt | 3,707,293 | 3,702,109 | |
2014 Credit Agreement | |||
Debt | |||
Total debt | 1,667,700 | 908,700 | |
2014 Senior Notes | |||
Debt | |||
Total debt | 800,000 | 1,600,000 | |
2017 Senior Notes | |||
Debt | |||
Total debt | 1,000,000 | 1,000,000 | |
URS Senior Notes | |||
Debt | |||
Total debt | 247,800 | 247,700 | $ 1,000,000 |
Other Debt | |||
Debt | |||
Total debt | $ 214,300 | $ 140,000 |
Debt - Scheduled Maturities (De
Debt - Scheduled Maturities (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Sep. 30, 2017 |
Scheduled maturities of debt: | ||
2018 (three months remaining) | $ 72.7 | |
2,019 | 122.2 | |
2,020 | 86.9 | |
2,021 | 485.8 | |
2,022 | 301 | |
Thereafter | 2,861.2 | |
Total debt | $ 3,929.8 | $ 3,896.4 |
Debt - 2014 Credit Agreement (D
Debt - 2014 Credit Agreement (Details) $ in Millions, $ in Millions, $ in Millions | Sep. 30, 2019 | Jun. 30, 2018USD ($) | Mar. 13, 2018USD ($) | Sep. 29, 2016USD ($) | Mar. 31, 2017 | Jun. 30, 2018USD ($) | Mar. 13, 2018CAD ($) | Mar. 13, 2018AUD ($) | Mar. 13, 2018USD ($) | Sep. 30, 2017USD ($) | Oct. 17, 2014CAD ($) | Oct. 17, 2014AUD ($) | Oct. 17, 2014USD ($) |
Term loan A | Base Rate | USD | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 0.50% | ||||||||||||
Secured letter of credit outside credit agreement | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity | $ 500 | ||||||||||||
2014 Credit Agreement | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity. | $ 600 | ||||||||||||
Maximum consolidated leverage ratio covenant | 5 | 4.75 | |||||||||||
Consolidated leverage ratio | 4.1 | ||||||||||||
Consolidated interest coverage ratio | 4.6 | ||||||||||||
2014 Credit Agreement | Base Rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 0.75% | ||||||||||||
2014 Credit Agreement | Euro currency rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 1.75% | ||||||||||||
2014 Credit Agreement | Maximum | Base Rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 1.00% | ||||||||||||
2014 Credit Agreement | Maximum | Euro currency rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 2.00% | ||||||||||||
2014 Credit Agreement | Minimum | Base Rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 0.25% | ||||||||||||
2014 Credit Agreement | Minimum | Euro currency rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 1.25% | ||||||||||||
2014 Credit Agreement | Term loan A | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity | $ 500 | $ 250 | $ 510 | $ 500 | $ 250 | $ 510 | |||||||
Borrowing capacity. | $ 185 | ||||||||||||
2014 Credit Agreement | Term loan A | Euro currency rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 1.50% | ||||||||||||
2014 Credit Agreement | Term loan B | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity | $ 600 | 600 | |||||||||||
2014 Credit Agreement | Term loan B | Base Rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 0.75% | ||||||||||||
2014 Credit Agreement | Term loan B | Euro currency rate | |||||||||||||
Debt agreements | |||||||||||||
Interest rate, basis spread (as a percent) | 1.75% | ||||||||||||
2014 Credit Agreement | Revolving credit facility | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity | $ 1,350 | ||||||||||||
Outstanding letters of credit | $ 53.9 | $ 53.9 | $ 58.1 | ||||||||||
Remaining borrowing capacity under credit facility | 1,220.4 | $ 1,220.4 | $ 991.9 | ||||||||||
2014 Credit Agreement | Revolving credit facility | Maximum | |||||||||||||
Debt agreements | |||||||||||||
Borrowing capacity. | $ 1,350 | $ 1,050 | |||||||||||
2014 Credit Agreement | Line of Credit | Maximum | |||||||||||||
Debt agreements | |||||||||||||
Consolidated leverage ratio | 4 | 4.5 |
Debt - 2014 Senior Notes (Detai
Debt - 2014 Senior Notes (Details) - USD ($) | Mar. 16, 2018 | Oct. 06, 2014 | Jun. 30, 2018 | Jun. 30, 2018 |
The 2022 Notes | ||||
Debt | ||||
Prepayment premium redemption | $ 34,500,000 | $ 34,500,000 | ||
2014 Senior Notes | The 2022 Notes | ||||
Debt | ||||
Principal amount | $ 800,000,000 | |||
Interest rate (as a percent) | 5.75% | |||
Redemption price equal to principal amount (in percent) | 104.313% | |||
Prepayment premium redemption | 34,500,000 | |||
2014 Senior Notes | The 2024 Notes | ||||
Debt | ||||
Principal amount | $ 800,000,000 | |||
Interest rate (as a percent) | 5.875% | |||
Fair value of debt instrument | $ 824,000,000 | $ 824,000,000 | ||
2014 Senior Notes | The 2024 Notes | Prior to July 15 2024 | ||||
Debt | ||||
Redemption price equal to principal amount (in percent) | 100.00% | |||
2014 Senior Notes | The 2024 Notes | On or after July 15, 2024 | ||||
Debt | ||||
Redemption price equal to principal amount (in percent) | 100.00% |
Debt - 2017 Senior Notes (Detai
Debt - 2017 Senior Notes (Details) - USD ($) | Feb. 21, 2017 | Jun. 30, 2018 |
Term loan A | ||
Debt | ||
Amount of debt redeemed | $ 600,000,000 | |
Term loan B | ||
Debt | ||
Amount of debt redeemed | 127,600,000 | |
Revolving credit facility | ||
Debt | ||
Amount of debt redeemed | 250,000,000 | |
2017 Senior Notes | ||
Debt | ||
Principal amount | $ 1,000,000,000 | |
Interest rate (as a percent) | 5.125% | |
Fair value of debt instrument | $ 935,000,000 | |
2017 Senior Notes | Prior to December 15, 2026 | ||
Debt | ||
Redemption price equal to principal amount (in percent) | 100.00% | |
2017 Senior Notes | Prior to March 15, 2020 | ||
Debt | ||
Maximum principal amount that can be redeemed using proceeds from equity offerings(in percent) | 35.00% | |
Redemption price equal to principal using proceeds from equity offerings (in percent) | 105.125% | |
2017 Senior Notes | On or after December 15, 2026 | ||
Debt | ||
Redemption price equal to principal amount (in percent) | 100.00% |
Debt - URS Senior Notes (Detail
Debt - URS Senior Notes (Details) - USD ($) $ in Millions | Oct. 24, 2014 | Jun. 30, 2018 | Sep. 30, 2017 | Apr. 03, 2017 | Oct. 17, 2014 |
Debt | |||||
Debt | $ 3,929.8 | $ 3,896.4 | |||
URS Senior Notes | |||||
Debt | |||||
Debt | 247.8 | $ 247.7 | $ 1,000 | ||
URS Senior Notes | 2017 URS Senor Notes | |||||
Debt | |||||
Interest rate (as a percent) | 3.85% | ||||
Redemption price equal to principal using proceeds from equity offerings (in percent) | 101.00% | ||||
Amount of debt redeemed | $ 572.3 | $ 179.2 | |||
URS Senior Notes | 2022 URS Senior Notes | |||||
Debt | |||||
Interest rate (as a percent) | 5.00% | ||||
Debt | 247.8 | ||||
Fair value of debt instrument | $ 251 |
Debt - Other Debt and Other Ite
Debt - Other Debt and Other Items(Details) - USD ($) $ in Millions | Jun. 30, 2018 | Sep. 30, 2017 |
Debt | ||
Total debt | $ 3,929.8 | $ 3,896.4 |
Other Debt | ||
Debt | ||
Total debt | 214.3 | 140 |
Other Debt | Standby letter of credit | ||
Debt | ||
Outstanding letters of credit | 451.9 | $ 445.7 |
Remaining borrowing capacity under credit facility | $ 485.9 |
Debt - Effective Interest Rate
Debt - Effective Interest Rate (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Debt | ||||
Effective interest rate including effects of interest rate swap agreements | 4.6% | 4.4% | ||
Amortization of deferred debt issuance costs | $ 2.5 | $ 2.8 | $ 15.1 | $ 14.3 |
The 2022 Notes | ||||
Debt | ||||
Prepayment premium redemption | $ 34.5 | $ 34.5 |
Derivative Financial Instrume55
Derivative Financial Instruments and Fair Value Measurements - Cash Flow Hedges (Details) - Designated as Hedging Instrument - Cash Flow Hedging $ in Millions, $ in Millions | Jun. 30, 2018AUD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2017AUD ($) | Sep. 30, 2017USD ($) |
Interest Rate Swap June 2018 | USD | ||||
Derivative financial instruments | ||||
Notional Amount | $ 300 | |||
Fixed Rate (as a percent) | 1.63% | 1.63% | ||
Interest Rate Swap September 2018 | USD | ||||
Derivative financial instruments | ||||
Notional Amount | $ 300 | $ 300 | ||
Fixed Rate (as a percent) | 1.54% | 1.54% | 1.54% | 1.54% |
Interest Rate Swap February 2021 | AUD | ||||
Derivative financial instruments | ||||
Notional Amount | $ 200 | |||
Fixed Rate (as a percent) | 2.19% | 2.19% | ||
Interest Rate Swap September 2022 | CAD | ||||
Derivative financial instruments | ||||
Notional Amount | $ 400 | |||
Fixed Rate (as a percent) | 2.49% | 2.49% | ||
Interest Rate Swap February 2023 | USD | ||||
Derivative financial instruments | ||||
Notional Amount | $ 200 | |||
Fixed Rate (as a percent) | 2.60% | 2.60% | ||
Foreign currency contracts | ||||
Derivative financial instruments | ||||
Notional principal of derivative exchange contracts | $ 67.3 | $ 50.9 | $ 15.1 | $ 11.3 |
Derivative Financial Instrume56
Derivative Financial Instruments and Fair Value Measurements - Fair Value Measurements (Details) | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2018USD ($) | Sep. 30, 2015item | Sep. 30, 2017USD ($) | |
Derivative financial instruments | |||
Number of contingent consideration arrangements | item | 1 | ||
Level 3 | |||
Derivative financial instruments | |||
Fair value of contingent consideration liability | $ 13,000,000 | $ 13,000,000 | |
Designated as Hedging Instrument | Cash Flow Hedging | Interest rate swap agreements | |||
Derivative financial instruments | |||
Losses Recognized in Income on Derivatives (Amount Excluded from Effectiveness Testing and Ineffective Portion) | $ 0 |
Share-based Payments (Details)
Share-based Payments (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | |
Stock options, Weighted average exercise price | |||
Vesting period | 3 years | 3 years | |
Recognized compensation expense | $ 54.3 | $ 58.7 | |
Unrecognized compensation expense | $ 111.1 | $ 96.8 | |
Employee Stock Option | |||
Shares of stock under options | |||
Balance at the beginning of the period (in shares) | 0.7 | 0.9 | 0.9 |
Options exercised (in shares) | (0.1) | (0.2) | |
Balance at the end of the period (in shares) | 0.6 | 0.7 | 0.7 |
Vested and expected to vest in the future at the end of the period (in shares) | 0.6 | 0.7 | |
Stock options, Weighted average exercise price | |||
Balance at the beginning of the period (in dollars per share) | $ 31.11 | $ 30.36 | $ 30.36 |
Options exercised (in dollars per share) | 27.79 | 26.42 | |
Balance at the end of the period (in dollars per share) | 31.62 | 31.11 | $ 31.11 |
Vested and expected to vest in the future at the end of the period (in dollars per share) | $ 31.62 | 31.11 | |
Performance Earnings Program | |||
Stock options, Weighted average exercise price | |||
Vesting period | 3 years | ||
Weighted average grant-date fair value of stock options granted (in dollars per share) | $ 37.69 | 38.16 | |
Restricted Stock Units (RSUs) | |||
Stock options, Weighted average exercise price | |||
Weighted average grant-date fair value of stock options granted (in dollars per share) | $ 36.91 | $ 37.97 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Taxes | ||||||
Effective tax rate (as a percent) | (71.80%) | 0.50% | ||||
Net benefit from Tax Cuts and Jobs Acts of 2017 | $ 41.7 | |||||
Benefit from change in uncertain tax positions in US and Canada | 33.8 | |||||
Benefit from income tax credits and incentives | 21.6 | |||||
Amount of tax expense arising from a business combination related to non-deductible goodwill | 33.9 | |||||
Amount of uncertain tax positions for future years | $ 26.2 | |||||
Federal statutory rate (as a percent) | 35.00% | 21.00% | ||||
Blended statutory rate (as a percentage) | 24.50% | |||||
Provisional amount related to remeasurement of deferred tax balance | $ 36.1 | |||||
Provisional amount of tax benefit related to releasing of deferred tax liability | 77 | |||||
Provisional amount of income tax expense related to transition tax on foreign subsidiaries | $ 71.4 | |||||
Gross book-tax differences from non-U.S. subsidiaries | $ 1,700 |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share | ||||
Denominator for basic earnings per share (in shares) | 160,395 | 155,763 | 159,266 | 155,128 |
Potential common shares (in shares) | 2,800 | 3,000 | 3,100 | 3,400 |
Denominator for diluted earnings per share (in shares) | 163,213 | 158,820 | 162,426 | 158,488 |
Other Financial Information (De
Other Financial Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Sep. 30, 2017 | |
Accrued expenses and other current liabilities | ||
Accrued salaries and benefits | $ 938,900 | $ 1,018,500 |
Accrued contract costs | 853,300 | 911,900 |
Other accrued expenses | 392,500 | 315,100 |
Total accrued expenses | 2,184,672 | 2,245,519 |
Restructuring charges | 26,700 | |
Payments for restructuring charges | 23,300 | |
Accounts receivable-net | 5,447,985 | 5,127,743 |
Accelerated recovery of pension entitlement | ||
Accrued expenses and other current liabilities | ||
Accounts receivable-net | 50,000 | |
Professional liability accrual | ||
Accrued expenses and other current liabilities | ||
Accrued contract costs | $ 540,500 | $ 547,900 |
Reclassifications out of Accu61
Reclassifications out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Accumulated balances | ||||
Balance at the beginning of the period | $ (707,000) | $ (871,600) | $ (700,661) | $ (857,600) |
Other comprehensive income (loss) before reclassification | (53,700) | 36,100 | (65,400) | 14,300 |
Amounts reclassified from accumulated other comprehensive income (loss) | 2,400 | 3,800 | 7,800 | 11,600 |
Balance at the end of the period | (758,287) | (831,700) | (758,287) | (831,700) |
Pension Related Adjustments | ||||
Accumulated balances | ||||
Balance at the beginning of the period | (295,500) | (353,500) | (281,900) | (368,900) |
Other comprehensive income (loss) before reclassification | 13,000 | (9,800) | (5,800) | (700) |
Amounts reclassified from accumulated other comprehensive income (loss) | 2,200 | 3,200 | 7,400 | 9,500 |
Balance at the end of the period | (280,300) | (360,100) | (280,300) | (360,100) |
Foreign Currency Translation Adjustments | ||||
Accumulated balances | ||||
Balance at the beginning of the period | (410,200) | (516,800) | (418,400) | (483,700) |
Other comprehensive income (loss) before reclassification | (67,100) | 46,000 | (58,900) | 12,900 |
Balance at the end of the period | (477,300) | (470,800) | (477,300) | (470,800) |
Loss on Derivative Instruments | ||||
Accumulated balances | ||||
Balance at the beginning of the period | (1,300) | (1,300) | (400) | (5,000) |
Other comprehensive income (loss) before reclassification | 400 | (100) | (700) | 2,100 |
Amounts reclassified from accumulated other comprehensive income (loss) | 200 | 600 | 400 | 2,100 |
Balance at the end of the period | $ (700) | $ (800) | $ (700) | $ (800) |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | May 24, 2018 | Jul. 21, 2017 | Jul. 03, 2017 | Apr. 01, 2017 | Sep. 30, 2017 | Dec. 31, 2014 | Jun. 30, 2018 | Sep. 02, 2016 |
URS | Design build contractor | ||||||||
Commitments and Contingencies | ||||||||
Damages claimed, value | $ 11,900,000 | $ 70,000,000 | $ 8,200,000 | |||||
Standby letter of credit | ||||||||
Commitments and Contingencies | ||||||||
Contingency liability | $ 503,800,000 | $ 505,800,000 | ||||||
Surety Bond | ||||||||
Commitments and Contingencies | ||||||||
Surety bonds issued | 5,700,000,000 | $ 5,500,000,000 | ||||||
AECOM USA, Inc. | Minimum | ||||||||
Commitments and Contingencies | ||||||||
Damages claimed, value | $ 100,000 | |||||||
Advatech LLC | ||||||||
Commitments and Contingencies | ||||||||
Percentage of ownership in joint venture | 60.00% | |||||||
Invoice amount | $ 81,000,000 | |||||||
Advatech LLC | Demand for arbitration and reimbursement | ||||||||
Commitments and Contingencies | ||||||||
Damages claimed, value | $ 81,000,000 | |||||||
DOE Deactivation, Demolition, And Removal Project | Department of Energy | Maximum | ||||||||
Commitments and Contingencies | ||||||||
Cost-reimbursement at risk | $ 106,000,000 | |||||||
DOE Deactivation, Demolition, And Removal Project | WGI Ohio and DOE | Minimum | ||||||||
Commitments and Contingencies | ||||||||
Cost-reimbursement at risk | 106,000,000 | |||||||
DOE Deactivation, Demolition, And Removal Project | WGI Ohio and DOE | Maximum | ||||||||
Commitments and Contingencies | ||||||||
Cost-reimbursement at risk | 146,000,000 | |||||||
DOE Deactivation, Demolition, And Removal Project | WGI Ohio | ||||||||
Commitments and Contingencies | ||||||||
Claim to DOE, including additional fees | $ 103,000,000 | |||||||
Possible costs which may exceed contracted amounts | $ 100,000,000 | |||||||
DOE Deactivation, Demolition, And Removal Project | WGI Ohio | Minimum | ||||||||
Commitments and Contingencies | ||||||||
Cost-reimbursement at risk | $ 146,000,000 |
Reportable Segments (Details)
Reportable Segments (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | Sep. 30, 2017USD ($) | |
Summarized financial information concerning the Company's reportable segments | |||||
Number of reportable segments | segment | 4 | ||||
Revenue | $ 5,147,920 | $ 4,561,467 | $ 14,849,662 | $ 13,347,014 | |
Gross profit | 185,179 | 175,176 | 462,603 | 513,593 | |
Equity in earnings of joint ventures | 12,863 | 66,458 | 55,621 | 109,667 | |
General and administrative expenses | (35,159) | (33,944) | (100,046) | (96,427) | |
Impairment of assets held for sale, including goodwill | (168,178) | ||||
Acquisition and integration expenses | (35,409) | ||||
(Loss) gain on disposal activities | (2,149) | (2,149) | 572 | ||
Operating income (loss) | $ 160,734 | $ 207,690 | $ 247,851 | $ 491,996 | |
Gross profit as a % of revenue | 3.60% | 3.80% | 3.10% | 3.80% | |
Total assets | $ 14,727,417 | $ 14,727,417 | $ 14,396,956 | ||
Corporate | |||||
Summarized financial information concerning the Company's reportable segments | |||||
General and administrative expenses | (31,400) | $ (31,900) | (90,800) | $ (89,900) | |
Acquisition and integration expenses | (35,400) | ||||
Operating income (loss) | (31,400) | (31,900) | (90,800) | (125,300) | |
Total assets | 453,900 | 453,900 | 386,200 | ||
Design and Consulting Services | |||||
Summarized financial information concerning the Company's reportable segments | |||||
Revenue | 2,105,400 | 1,863,500 | 6,052,000 | 5,571,800 | |
Gross profit | 116,100 | 91,200 | 314,200 | 292,500 | |
Equity in earnings of joint ventures | 4,200 | 2,500 | 14,500 | 12,600 | |
(Loss) gain on disposal activities | 600 | ||||
Operating income (loss) | $ 120,300 | $ 93,700 | $ 328,700 | $ 305,700 | |
Gross profit as a % of revenue | 5.50% | 4.90% | 5.20% | 5.20% | |
Total assets | $ 7,143,700 | $ 7,143,700 | 6,992,600 | ||
Construction Services | |||||
Summarized financial information concerning the Company's reportable segments | |||||
Revenue | 2,106,700 | $ 1,841,700 | 6,120,500 | $ 5,324,600 | |
Gross profit | 9,100 | 26,200 | 22,900 | 60,400 | |
Equity in earnings of joint ventures | 2,300 | 7,000 | 16,900 | 16,600 | |
Impairment of assets held for sale, including goodwill | (168,200) | ||||
(Loss) gain on disposal activities | (2,100) | (2,100) | |||
Operating income (loss) | $ 9,300 | $ 33,200 | $ (130,500) | $ 77,000 | |
Gross profit as a % of revenue | 0.40% | 1.40% | 0.40% | 1.10% | |
Total assets | $ 4,235,900 | $ 4,235,900 | 4,114,500 | ||
Management Services | |||||
Summarized financial information concerning the Company's reportable segments | |||||
Revenue | 935,900 | $ 856,300 | 2,677,200 | $ 2,450,600 | |
Gross profit | 60,000 | 57,800 | 125,500 | 160,700 | |
Equity in earnings of joint ventures | 6,300 | 8,600 | 24,200 | 32,100 | |
Operating income (loss) | $ 66,300 | $ 66,400 | $ 149,700 | $ 192,800 | |
Gross profit as a % of revenue | 6.40% | 6.70% | 4.70% | 6.60% | |
Total assets | $ 2,682,300 | $ 2,682,300 | 2,704,600 | ||
AECOM Capital | |||||
Summarized financial information concerning the Company's reportable segments | |||||
Equity in earnings of joint ventures | $ 48,400 | $ 48,400 | |||
General and administrative expenses | (3,700) | (2,100) | (9,200) | (6,600) | |
Operating income (loss) | (3,700) | $ 46,300 | (9,200) | $ 41,800 | |
Total assets | $ 211,600 | $ 211,600 | $ 199,100 |
Condensed Consolidating Finan64
Condensed Consolidating Financial Information - Debt (Details) | 9 Months Ended |
Jun. 30, 2018 | |
Condensed Consolidating Financial Information | |
Ownership of directly and indirectly owned subsidiaries (as a percent) | 100.00% |
Condensed Consolidating Finan65
Condensed Consolidating Financial Information - Balance Sheets (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Sep. 30, 2017 |
CURRENT ASSETS: | ||
Total cash and cash equivalents | $ 801,419 | $ 802,362 |
Accounts receivable-net | 5,447,985 | 5,127,743 |
Prepaid expenses and other current assets | 651,816 | 696,718 |
Current assets held for sale | 63,303 | |
Income taxes receivable | 79,319 | 55,399 |
TOTAL CURRENT ASSETS | 7,043,842 | 6,682,222 |
PROPERTY AND EQUIPMENT-NET | 607,151 | 621,357 |
DEFERRED TAX ASSETS-NET | 181,564 | 171,331 |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 398,134 | 364,223 |
GOODWILL | 5,928,029 | 5,992,881 |
INTANGIBLE ASSETS-NET | 343,185 | 415,096 |
OTHER NON-CURRENT ASSETS | 225,512 | 149,846 |
TOTAL ASSETS | 14,727,417 | 14,396,956 |
CURRENT LIABILITIES: | ||
Short-term debt | 47,402 | 1,221 |
Accounts payable | 2,517,234 | 2,249,872 |
Accrued expenses and other current liabilities | 2,184,672 | 2,245,519 |
Income taxes payable | 28,493 | 38,176 |
Billings in excess of costs on uncompleted contracts | 968,778 | 902,812 |
Current liabilities held for sale | 17,914 | |
Current portion of long-term debt | 125,577 | 140,779 |
TOTAL CURRENT LIABILITIES | 5,890,070 | 5,578,379 |
OTHER LONG-TERM LIABILITIES | 855,500 | 881,300 |
DEFERRED TAX LIABILITY-NET | 14,354 | 20,515 |
LONG-TERM DEBT | 3,707,293 | 3,702,109 |
TOTAL LIABILITIES | 10,467,283 | 10,182,270 |
TOTAL AECOM STOCKHOLDERS' EQUITY | 4,077,732 | 3,996,126 |
Noncontrolling interests | 182,402 | 218,560 |
TOTAL STOCKHOLDERS' EQUITY | 4,260,134 | 4,214,686 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 14,727,417 | 14,396,956 |
Eliminations | ||
CURRENT ASSETS: | ||
Intercompany receivable | (1,138,000) | (996,000) |
TOTAL CURRENT ASSETS | (1,138,000) | (996,000) |
DEFERRED TAX ASSETS-NET | (158,600) | (294,600) |
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES | (8,936,000) | (9,419,000) |
TOTAL ASSETS | (10,232,600) | (10,709,600) |
CURRENT LIABILITIES: | ||
Intercompany payable | (1,318,600) | (1,098,300) |
TOTAL CURRENT LIABILITIES | (1,318,600) | (1,098,300) |
DEFERRED TAX LIABILITY-NET | (158,600) | (294,600) |
NOTE PAYABLE INTERCOMPANY-NON CURRENT | (1,158,100) | (467,300) |
TOTAL LIABILITIES | (2,635,300) | (1,860,200) |
TOTAL AECOM STOCKHOLDERS' EQUITY | (7,597,300) | (8,849,400) |
TOTAL STOCKHOLDERS' EQUITY | (7,597,300) | (8,849,400) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | (10,232,600) | (10,709,600) |
Parent | Reportable Legal Entities | ||
CURRENT ASSETS: | ||
Total cash and cash equivalents | 2,000 | 32,600 |
Intercompany receivable | 812,700 | 723,600 |
Prepaid expenses and other current assets | 82,700 | 67,500 |
Income taxes receivable | 27,900 | 4,300 |
TOTAL CURRENT ASSETS | 925,300 | 828,000 |
PROPERTY AND EQUIPMENT-NET | 201,800 | 160,200 |
DEFERRED TAX ASSETS-NET | 127,800 | 239,700 |
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES | 6,699,700 | 6,606,200 |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 12,400 | 7,200 |
OTHER NON-CURRENT ASSETS | 53,700 | 8,700 |
TOTAL ASSETS | 8,020,700 | 7,850,000 |
CURRENT LIABILITIES: | ||
Short-term debt | 6,700 | 1,100 |
Accounts payable | 51,100 | 33,800 |
Accrued expenses and other current liabilities | 80,300 | 92,200 |
Intercompany payable | 180,200 | 149,200 |
Billings in excess of costs on uncompleted contracts | 2,000 | 3,400 |
Current portion of long-term debt | 41,700 | 110,900 |
TOTAL CURRENT LIABILITIES | 362,000 | 390,600 |
OTHER LONG-TERM LIABILITIES | 140,000 | 102,300 |
NOTE PAYABLE INTERCOMPANY-NON CURRENT | 675,800 | 100 |
LONG-TERM DEBT | 2,856,300 | 3,366,900 |
TOTAL LIABILITIES | 4,034,100 | 3,859,900 |
TOTAL AECOM STOCKHOLDERS' EQUITY | 3,986,600 | 3,990,100 |
TOTAL STOCKHOLDERS' EQUITY | 3,986,600 | 3,990,100 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 8,020,700 | 7,850,000 |
Guarantor Subsidiaries | Reportable Legal Entities | ||
CURRENT ASSETS: | ||
Total cash and cash equivalents | 302,800 | 254,900 |
Accounts receivable-net | 2,628,100 | 2,426,400 |
Intercompany receivable | 82,800 | 89,000 |
Prepaid expenses and other current assets | 339,700 | 366,500 |
TOTAL CURRENT ASSETS | 3,353,400 | 3,136,800 |
PROPERTY AND EQUIPMENT-NET | 221,300 | 215,000 |
DEFERRED TAX ASSETS-NET | 56,200 | 61,700 |
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES | 2,236,300 | 2,812,800 |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 55,400 | 69,700 |
GOODWILL | 3,392,700 | 3,392,700 |
INTANGIBLE ASSETS-NET | 229,300 | 271,600 |
OTHER NON-CURRENT ASSETS | 46,300 | 47,400 |
TOTAL ASSETS | 9,590,900 | 10,007,700 |
CURRENT LIABILITIES: | ||
Accounts payable | 1,503,200 | 1,301,700 |
Accrued expenses and other current liabilities | 1,017,600 | 1,171,800 |
Income taxes payable | 8,100 | |
Intercompany payable | 830,700 | 789,500 |
Billings in excess of costs on uncompleted contracts | 359,100 | 341,700 |
Current portion of long-term debt | 26,700 | 14,900 |
TOTAL CURRENT LIABILITIES | 3,737,300 | 3,627,700 |
OTHER LONG-TERM LIABILITIES | 268,500 | 290,700 |
DEFERRED TAX LIABILITY-NET | 600 | |
LONG-TERM DEBT | 284,800 | 281,600 |
TOTAL LIABILITIES | 4,290,600 | 4,200,600 |
TOTAL AECOM STOCKHOLDERS' EQUITY | 5,300,300 | 5,807,100 |
TOTAL STOCKHOLDERS' EQUITY | 5,300,300 | 5,807,100 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 9,590,900 | 10,007,700 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||
CURRENT ASSETS: | ||
Total cash and cash equivalents | 496,600 | 514,900 |
Accounts receivable-net | 2,819,900 | 2,701,300 |
Intercompany receivable | 242,500 | 183,400 |
Prepaid expenses and other current assets | 229,400 | 262,700 |
Current assets held for sale | 63,300 | |
Income taxes receivable | 51,400 | 51,100 |
TOTAL CURRENT ASSETS | 3,903,100 | 3,713,400 |
PROPERTY AND EQUIPMENT-NET | 184,100 | 246,200 |
DEFERRED TAX ASSETS-NET | 156,200 | 164,500 |
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES | 330,300 | 287,300 |
GOODWILL | 2,535,300 | 2,600,200 |
INTANGIBLE ASSETS-NET | 113,900 | 143,500 |
OTHER NON-CURRENT ASSETS | 125,500 | 93,800 |
TOTAL ASSETS | 7,348,400 | 7,248,900 |
CURRENT LIABILITIES: | ||
Short-term debt | 40,700 | 100 |
Accounts payable | 962,900 | 914,400 |
Accrued expenses and other current liabilities | 1,086,800 | 981,500 |
Income taxes payable | 28,500 | 30,100 |
Intercompany payable | 307,700 | 159,600 |
Billings in excess of costs on uncompleted contracts | 607,700 | 557,700 |
Current liabilities held for sale | 17,900 | |
Current portion of long-term debt | 57,200 | 15,000 |
TOTAL CURRENT LIABILITIES | 3,109,400 | 2,658,400 |
OTHER LONG-TERM LIABILITIES | 447,000 | 488,300 |
DEFERRED TAX LIABILITY-NET | 173,000 | 314,500 |
NOTE PAYABLE INTERCOMPANY-NON CURRENT | 482,300 | 467,200 |
LONG-TERM DEBT | 566,200 | 53,600 |
TOTAL LIABILITIES | 4,777,900 | 3,982,000 |
TOTAL AECOM STOCKHOLDERS' EQUITY | 2,388,100 | 3,048,300 |
Noncontrolling interests | 182,400 | 218,600 |
TOTAL STOCKHOLDERS' EQUITY | 2,570,500 | 3,266,900 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 7,348,400 | $ 7,248,900 |
Condensed Consolidating Finan66
Condensed Consolidating Financial Information - Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Condensed Consolidating Statements of Operations | ||||
Revenue | $ 5,147,920 | $ 4,561,467 | $ 14,849,662 | $ 13,347,014 |
Cost of revenue | 4,962,741 | 4,386,291 | 14,387,059 | 12,833,421 |
Gross profit | 185,179 | 175,176 | 462,603 | 513,593 |
Equity in earnings of joint ventures | 12,863 | 66,458 | 55,621 | 109,667 |
General and administrative expenses | (35,159) | (33,944) | (100,046) | (96,427) |
Impairment of assets held for sale, including goodwill | (168,178) | |||
Acquisition and integration expenses | (35,409) | |||
(Loss) gain on disposal activities | (2,149) | (2,149) | 572 | |
Income from operations | 160,734 | 207,690 | 247,851 | 491,996 |
Other income | 2,752 | 2,136 | 17,542 | 4,237 |
Interest expense | (55,213) | (61,547) | (211,955) | (176,985) |
Income before income tax expense (benefit) | 108,273 | 148,279 | 53,438 | 319,248 |
Income tax (benefit) expense | 33,131 | 12,205 | (38,362) | 1,556 |
Net income | 75,142 | 136,074 | 91,800 | 317,692 |
Noncontrolling interests in income of consolidated subsidiaries, net of tax | (14,232) | (34,747) | (39,309) | (66,790) |
Net income attributable to AECOM | 60,910 | 101,327 | 52,491 | 250,902 |
Eliminations | ||||
Condensed Consolidating Statements of Operations | ||||
Revenue | (26,900) | (48,100) | (68,700) | (52,300) |
Cost of revenue | (26,900) | (48,100) | (68,700) | (52,300) |
Equity in earnings from subsidiaries | (125,600) | (130,600) | (376,500) | (545,400) |
Income from operations | (125,600) | (130,600) | (376,500) | (545,400) |
Other income | (10,500) | (8,700) | (23,300) | (27,900) |
Interest expense | 10,500 | 8,700 | 23,300 | 27,900 |
Income before income tax expense (benefit) | (125,600) | (130,600) | (376,500) | (545,400) |
Net income | (125,600) | (130,600) | (376,500) | (545,400) |
Net income attributable to AECOM | (125,600) | (130,600) | (376,500) | (545,400) |
Parent | Reportable Legal Entities | ||||
Condensed Consolidating Statements of Operations | ||||
Equity in earnings from subsidiaries | 84,800 | 112,500 | 272,700 | 396,100 |
General and administrative expenses | (31,400) | (31,900) | (90,800) | (89,900) |
Acquisition and integration expenses | (35,400) | |||
Income from operations | 53,400 | 80,600 | 181,900 | 270,800 |
Other income | 400 | 800 | 10,800 | 1,700 |
Interest expense | (49,000) | (52,600) | (194,300) | (155,500) |
Income before income tax expense (benefit) | 4,800 | 28,800 | (1,600) | 117,000 |
Income tax (benefit) expense | (56,100) | (72,400) | (54,100) | (133,800) |
Net income | 60,900 | 101,200 | 52,500 | 250,800 |
Net income attributable to AECOM | 60,900 | 101,200 | 52,500 | 250,800 |
Guarantor Subsidiaries | Reportable Legal Entities | ||||
Condensed Consolidating Statements of Operations | ||||
Revenue | 2,818,100 | 2,604,200 | 8,230,100 | 7,699,400 |
Cost of revenue | 2,731,800 | 2,526,400 | 7,950,000 | 7,410,300 |
Gross profit | 86,300 | 77,800 | 280,100 | 289,100 |
Equity in earnings from subsidiaries | 40,800 | 18,100 | 103,800 | 149,300 |
Equity in earnings of joint ventures | 6,900 | 12,500 | 30,900 | 34,500 |
Income from operations | 134,000 | 108,400 | 414,800 | 472,900 |
Other income | 9,600 | 7,600 | 20,100 | 23,600 |
Interest expense | (5,600) | (6,700) | (14,500) | (18,300) |
Income before income tax expense (benefit) | 138,000 | 109,300 | 420,400 | 478,200 |
Income tax (benefit) expense | 54,500 | 37,400 | 149,400 | 114,800 |
Net income | 83,500 | 71,900 | 271,000 | 363,400 |
Net income attributable to AECOM | 83,500 | 71,900 | 271,000 | 363,400 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Condensed Consolidating Statements of Operations | ||||
Revenue | 2,356,800 | 2,005,400 | 6,688,300 | 5,699,900 |
Cost of revenue | 2,257,900 | 1,908,000 | 6,505,800 | 5,475,400 |
Gross profit | 98,900 | 97,400 | 182,500 | 224,500 |
Equity in earnings of joint ventures | 5,900 | 54,000 | 24,700 | 75,200 |
General and administrative expenses | (3,700) | (2,100) | (9,200) | (6,600) |
Impairment of assets held for sale, including goodwill | (168,200) | |||
(Loss) gain on disposal activities | (2,100) | (2,100) | 600 | |
Income from operations | 99,000 | 149,300 | 27,700 | 293,700 |
Other income | 3,200 | 2,400 | 9,900 | 6,800 |
Interest expense | (11,200) | (11,000) | (26,500) | (31,100) |
Income before income tax expense (benefit) | 91,000 | 140,700 | 11,100 | 269,400 |
Income tax (benefit) expense | 34,700 | 47,100 | (133,700) | 20,500 |
Net income | 56,300 | 93,600 | 144,800 | 248,900 |
Noncontrolling interests in income of consolidated subsidiaries, net of tax | (14,200) | (34,800) | (39,300) | (66,800) |
Net income attributable to AECOM | $ 42,100 | $ 58,800 | $ 105,500 | $ 182,100 |
Condensed Consolidating Finan67
Condensed Consolidating Financial Information - Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | $ 75,142 | $ 136,074 | $ 91,800 | $ 317,692 |
Other comprehensive income (loss), net of tax: | ||||
Net unrealized gain (loss) on derivatives, net of tax | 626 | 563 | (214) | 4,263 |
Foreign currency translation adjustments | (67,255) | 46,203 | (57,742) | 13,164 |
Pension adjustments, net of tax | 15,188 | (6,562) | 1,553 | 8,866 |
Other comprehensive (loss) income, net of tax | (51,441) | 40,204 | (56,403) | 26,293 |
Comprehensive income, net of tax | 23,701 | 176,278 | 35,397 | 343,985 |
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax | (14,078) | (35,032) | (40,532) | (67,160) |
Comprehensive income (loss) attributable to AECOM, net of tax | 9,623 | 141,246 | (5,135) | 276,825 |
Eliminations | ||||
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | (125,600) | (130,600) | (376,500) | (545,400) |
Other comprehensive income (loss), net of tax: | ||||
Comprehensive income, net of tax | (125,600) | (130,600) | (376,500) | (545,400) |
Comprehensive income (loss) attributable to AECOM, net of tax | (125,600) | (130,600) | (376,500) | (545,400) |
Parent | Reportable Legal Entities | ||||
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | 60,900 | 101,200 | 52,500 | 250,800 |
Other comprehensive income (loss), net of tax: | ||||
Net unrealized gain (loss) on derivatives, net of tax | 900 | 500 | 1,500 | 4,600 |
Pension adjustments, net of tax | 300 | 600 | 1,800 | 1,900 |
Other comprehensive (loss) income, net of tax | 1,200 | 1,100 | 3,300 | 6,500 |
Comprehensive income, net of tax | 62,100 | 102,300 | 55,800 | 257,300 |
Comprehensive income (loss) attributable to AECOM, net of tax | 62,100 | 102,300 | 55,800 | 257,300 |
Guarantor Subsidiaries | Reportable Legal Entities | ||||
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | 83,500 | 71,900 | 271,000 | 363,400 |
Other comprehensive income (loss), net of tax: | ||||
Comprehensive income, net of tax | 83,500 | 71,900 | 271,000 | 363,400 |
Comprehensive income (loss) attributable to AECOM, net of tax | 83,500 | 71,900 | 271,000 | 363,400 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income | 56,300 | 93,600 | 144,800 | 248,900 |
Other comprehensive income (loss), net of tax: | ||||
Net unrealized gain (loss) on derivatives, net of tax | (200) | 100 | (1,700) | (300) |
Foreign currency translation adjustments | (67,200) | 46,200 | (57,700) | 13,200 |
Pension adjustments, net of tax | 14,800 | (7,200) | (300) | 6,900 |
Other comprehensive (loss) income, net of tax | (52,600) | 39,100 | (59,700) | 19,800 |
Comprehensive income, net of tax | 3,700 | 132,700 | 85,100 | 268,700 |
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax | (14,000) | (35,100) | (40,500) | (67,200) |
Comprehensive income (loss) attributable to AECOM, net of tax | $ (10,300) | $ 97,600 | $ 44,600 | $ 201,500 |
Condensed Consolidating Finan68
Condensed Consolidating Financial Information - Cash Flows (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Condensed Consolidating Statements of Cash Flows | ||
CASH FLOWS FROM OPERATING ACTIVITIES | $ 242,667 | $ 445,357 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Payment for business acquisitions, net of cash acquired | (1,700) | |
Proceeds from purchase price adjustment to business acquisition | 2,200 | |
Cash acquired from consolidation of joint venture | 7,630 | |
Proceeds from disposal of businesses, net of cash disposed | 19,537 | 2,200 |
Net investment in unconsolidated joint ventures | (63,300) | (10,800) |
Net Proceeds from sale of investments | 700 | |
Net payments for purchase of investments | (17,500) | |
Payments for capital expenditures, net of disposals | (65,600) | (58,500) |
Net cash used in investing activities | (117,054) | (68,127) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from borrowings under credit agreements | 7,439,180 | 4,638,662 |
Repayments of borrowings under credit agreements | (6,654,873) | (5,635,212) |
Proceeds from issuance of unsecured senior notes | 1,000,000 | |
Redemption of unsecured senior notes | (800,000) | (179,208) |
Prepayment premium on redemption of unsecured senior notes | (34,504) | |
Cash paid for debt issuance costs | (10,708) | (13,041) |
Proceeds from issuance of common stock | 27,300 | 24,717 |
Proceeds from exercise of stock options | 3,200 | 3,679 |
Payments to repurchase common stock | (29,342) | (22,332) |
Net distributions to noncontrolling interests | (72,736) | (44,603) |
Other financing activities | 8,702 | (29,421) |
Net cash used in financing activities | (123,781) | (256,759) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (2,775) | (157) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (943) | 120,314 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 802,362 | 692,145 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 801,419 | 812,459 |
Eliminations | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net (investment in) receipts from intercompany notes | 704,500 | 25,100 |
Other intercompany investing activities | (614,800) | (50,000) |
Net cash used in investing activities | 89,700 | (24,900) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net borrowings (repayments) on intercompany notes | (704,500) | (25,100) |
Other intercompany financing activities | 614,800 | 50,000 |
Net cash used in financing activities | (89,700) | 24,900 |
Parent | Reportable Legal Entities | ||
Condensed Consolidating Statements of Cash Flows | ||
CASH FLOWS FROM OPERATING ACTIVITIES | (59,900) | (123,000) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net investment in unconsolidated joint ventures | (5,200) | |
Payments for capital expenditures, net of disposals | (19,800) | (17,800) |
Net (investment in) receipts from intercompany notes | (85,400) | (2,100) |
Other intercompany investing activities | 109,900 | 118,400 |
Net cash used in investing activities | (500) | 98,500 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from borrowings under credit agreements | 6,701,200 | 4,630,300 |
Repayments of borrowings under credit agreements | (6,509,500) | (5,580,000) |
Proceeds from issuance of unsecured senior notes | 1,000,000 | |
Redemption of unsecured senior notes | (800,000) | |
Prepayment premium on redemption of unsecured senior notes | (34,500) | |
Cash paid for debt issuance costs | (10,700) | (13,100) |
Proceeds from issuance of common stock | 27,300 | 24,700 |
Proceeds from exercise of stock options | 3,200 | 3,600 |
Payments to repurchase common stock | (29,300) | (22,300) |
Other financing activities | 8,800 | (17,000) |
Net borrowings (repayments) on intercompany notes | 673,300 | 24,300 |
Net cash used in financing activities | 29,800 | 50,500 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (30,600) | 26,000 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 32,600 | 1,800 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 2,000 | 27,800 |
Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Consolidating Statements of Cash Flows | ||
CASH FLOWS FROM OPERATING ACTIVITIES | 257,300 | 548,300 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net investment in unconsolidated joint ventures | (9,400) | 300 |
Payments for capital expenditures, net of disposals | (34,200) | (24,500) |
Net (investment in) receipts from intercompany notes | (545,300) | (16,000) |
Other intercompany investing activities | 504,900 | (68,400) |
Net cash used in investing activities | (84,000) | (108,600) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayments of borrowings under credit agreements | (14,000) | (25,900) |
Redemption of unsecured senior notes | (179,200) | |
Other financing activities | (26,600) | (65,400) |
Net borrowings (repayments) on intercompany notes | (4,800) | (17,400) |
Other intercompany financing activities | (80,000) | (149,200) |
Net cash used in financing activities | (125,400) | (437,100) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 47,900 | 2,600 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 254,900 | 196,300 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 302,800 | 198,900 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Consolidating Statements of Cash Flows | ||
CASH FLOWS FROM OPERATING ACTIVITIES | 45,300 | 20,100 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Payment for business acquisitions, net of cash acquired | (1,700) | |
Proceeds from purchase price adjustment to business acquisition | 2,200 | |
Cash acquired from consolidation of joint venture | 7,600 | |
Proceeds from disposal of businesses, net of cash disposed | 19,500 | 2,200 |
Net investment in unconsolidated joint ventures | (48,700) | (11,100) |
Net Proceeds from sale of investments | 700 | |
Net payments for purchase of investments | (17,500) | |
Payments for capital expenditures, net of disposals | (11,600) | (16,200) |
Net (investment in) receipts from intercompany notes | (73,800) | (7,000) |
Net cash used in investing activities | (122,300) | (33,100) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from borrowings under credit agreements | 737,900 | 8,400 |
Repayments of borrowings under credit agreements | (131,400) | (29,300) |
Net distributions to noncontrolling interests | (72,700) | (44,600) |
Other financing activities | 26,500 | 53,000 |
Net borrowings (repayments) on intercompany notes | 36,000 | 18,200 |
Other intercompany financing activities | (534,800) | 99,200 |
Net cash used in financing activities | 61,500 | 104,900 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (2,800) | (200) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (18,300) | 91,700 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 514,900 | 494,000 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 496,600 | $ 585,700 |