10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

xQuarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2016

OR

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _______________ to _______________

Commission file number 1-9947

TRC COMPANIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	06-0853807
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
21 Griffin Road North
Windsor, Connecticut	06095
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (860) 298-9692

___________________________________________________

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES [X] NO [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer [ ]	Accelerated filer [X]	Non-accelerated filer [ ]	Smaller reporting company [ ]
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).         YES [ ] NO [X]

On October 17, 2016 there were 31,390,002 shares of the registrant's common stock, $.10 par value, outstanding.

TRC COMPANIES, INC.

CONTENTS OF QUARTERLY REPORT ON FORM 10-Q

QUARTER ENDED SEPTEMBER 30, 2016

PART I - Financial Information
Item 1.	Financial Statements (Unaudited):
	Condensed Consolidated Statements of Operations for the three months ended September 30, 2016 and September 25, 2015	3
	Condensed Consolidated Statements of Comprehensive Income for the three months ended September 30, 2016 and September 25, 2015	4
	Condensed Consolidated Balance Sheets as of September 30, 2016 and June 30, 2016	5
	Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2016 and September 25, 2015	6
	Condensed Consolidated Statements of Changes in Equity for the three months ended September 30, 2016 and September 25, 2015	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38
Item 4.	Controls and Procedures	38
PART II - Other Information
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults Upon Senior Securities	39
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	39
Signature		40
Exhibits

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PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

TRC COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(Unaudited)

	Three Months Ended
	September 30, 2016			September 25, 2015
Gross revenue	$	180,851		$	135,459
Less subcontractor costs and other direct reimbursable charges	56,546			35,296
Net service revenue	124,305			100,163
Interest income from contractual arrangements	34			15
Insurance recoverables and other income	637			742
Operating costs and expenses:
Cost of services (exclusive of costs shown separately below)	103,676			82,984
General and administrative expenses	10,839			7,121
Acquisition and integration expenses	—			878
Depreciation	1,788			1,424
Amortization	2,716			840
Total operating costs and expenses	119,019			93,247
Operating income	5,957			7,673
Interest income	278			—
Interest expense	(845		)	(28		)
Income from operations before taxes	5,390			7,645
Income tax provision	(1,731		)	(3,157		)
Net income	3,659			4,488
Net (income) loss applicable to noncontrolling interest	(20		)	4
Net income applicable to TRC Companies, Inc.	$	3,639		$	4,492
Basic earnings per common share	$	0.12		$	0.15
Diluted earnings per common share	$	0.12		$	0.14
Weighted-average common shares outstanding:
Basic	31,149			30,635
Diluted	31,601			31,318

See accompanying notes to condensed consolidated financial statements.

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TRC COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(Unaudited)

			Three Months Ended
			September 30, 2016			September 25, 2015
Net income			$	3,659		$	4,488
Other comprehensive (loss) income
	Unrealized (loss) gain on available-for-sale securities		(44		)	(12		)
	Tax effect on unrealized (loss) gain on available-for-sale securities		17			5
	Reclassification for loss (gain) on available-for-sale securities included in net income		—			25
	Tax effect on realized (gain) loss on available-for-sale securities		—			(10		)
		Total other comprehensive (loss) income	(27		)	8
Comprehensive income			3,632			4,496
	Comprehensive (income) loss attributable to noncontrolling interests		(20		)	4
Comprehensive income attributable to TRC Companies, Inc.			$	3,612		$	4,500

See accompanying notes to condensed consolidated financial statements.

4

TRC COMPANIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

(Unaudited)

	September 30, 2016			June 30, 2016
ASSETS
Current assets:
Cash and cash equivalents	$	12,681		$	18,804
Restricted cash	60			71
Accounts receivable, less allowance for doubtful accounts	168,466			149,280
Insurance recoverable - environmental remediation	50,086			49,934
Restricted investments	5,473			5,959
Income taxes refundable	—			75
Prepaid expenses and other current assets	21,917			24,122
Total current assets	258,683			248,245
Property and equipment	75,193			74,053
Less accumulated depreciation and amortization	(52,922		)	(51,593		)
Property and equipment, net	22,271			22,460
Goodwill	75,337			75,337
Intangible assets, net	43,253			45,969
Deferred income tax assets	25,851			26,239
Long-term restricted investments	18,150			18,420
Long-term prepaid insurance	22,896			23,425
Other assets	16,575			18,383
Total assets	$	483,016		$	478,478
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	15,497		$	18,339
Accounts payable	39,210			29,311
Accrued compensation and benefits	47,733			48,485
Deferred revenue	13,880			15,363
Environmental remediation liabilities	8,646			8,654
Income taxes payable	902			265
Other accrued liabilities	57,541			58,026
Total current liabilities	183,409			178,443
Non-current liabilities:
Long-term debt, net of current portion	77,253			79,243
Long-term income taxes payable	903			2,204
Deferred revenue	63,933			65,340
Environmental remediation liabilities	408			433
Total liabilities	325,906			325,663
Commitments and contingencies
Equity:
Common stock, $.10 par value; 40,000,000 shares authorized, 31,258,090 and 31,254,608 shares issued and outstanding, respectively, at September 30, 2016, and 31,087,084 and 31,083,602 shares issued and outstanding, respectively, at June 30, 2016	3,126			3,109
Additional paid-in capital	195,802			195,156
Accumulated deficit	(42,259		)	(45,898		)
Accumulated other comprehensive loss	(98		)	(71		)
Treasury stock, at cost	(33		)	(33		)
Total stockholders' equity applicable to TRC Companies, Inc.	156,538			152,263
Noncontrolling interest	572			552
Total equity	157,110			152,815
Total liabilities and equity	$	483,016		$	478,478

See accompanying notes to condensed consolidated financial statements.

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TRC COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

	Three Months Ended
	September 30, 2016			September 25, 2015
Cash flows from operating activities:
Net income	$	3,659		$	4,488
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Non-cash items:
Depreciation and amortization	4,504			2,264
Amortization of debt issuance costs	180			—
Stock-based compensation expense	1,457			1,269
Provision for doubtful accounts	616			—
Deferred income taxes	380			(181		)
Other non-cash items	(342		)	594
Changes in operating assets and liabilities:
Accounts receivable	(19,660		)	3,205
Insurance recoverable - environmental remediation	(152		)	8
Income taxes	(589		)	(1,514		)
Restricted investments	224			252
Prepaid expenses and other current assets	(1,158		)	(3,852		)
Long-term prepaid insurance	529			563
Other assets	1,705			168
Accounts payable	9,884			(444		)
Accrued compensation and benefits	(1,560		)	7,909
Deferred revenue	(2,890		)	334
Environmental remediation liabilities	(33		)	(22		)
Other accrued liabilities	60			(653		)
Net cash (used in) provided by operating activities	(3,186		)	14,388
Cash flows from investing activities:
Additions to property and equipment	(1,625		)	(2,039		)
Withdrawals from restricted investments	512			66
Proceeds from sale of fixed assets	123			11
Net cash used in investing activities	(990		)	(1,962		)
Cash flows from financing activities:
Payments on long-term debt and other	(8,363		)	(1,016		)
Payments on capital lease obligations	—			(74		)
Proceeds from long-term debt and other	4,865			5,632
Repayments of term loan debt	(1,406		)	—
Net working capital and additional cash payments on acquisitions	2,957			(359		)
Shares repurchased to settle tax withholding obligations	—			(1,527		)
Excess tax benefit from stock-based awards	—			740
Proceeds from exercise of stock options	—			31
Net cash (used in) provided by financing activities	(1,947		)	3,427
(Decrease) increase in cash and cash equivalents	(6,123		)	15,853
Cash and cash equivalents, beginning of period	18,804			37,296
Cash and cash equivalents, end of period	$	12,681		$	53,149

See accompanying notes to condensed consolidated financial statements.

6

TRC COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(in thousands)

(Unaudited)

	TRC Companies, Inc. Stockholders' Equity
												Accumulated							Total
	Common Stock					Additional						Other			Treasury Stock				TRC			Non-
	Number					Paid-in			Accumulated			Comp.			Number				Stockholders'			Controlling			Total
	of Shares		Amount			Capital			Deficit			Loss			of Shares	Amount			Equity			Interest			Equity
Balances as of July 1, 2015	30,486		$	3,049		$	191,321		$	(45,939	)	$	(88	)	3	$	(33	)	$	148,310		$	(395	)	$	147,915
Net income	—		—			—			4,492			—			—	—			4,492			(4		)	4,488
Other comprehensive income	—		—			—			—			8			—	—			8			—			8
Exercise of stock options	11		1			30			—			—			—	—			31			—			31
Stock-based compensation	526		52			1,217			—			—			—	—			1,269			—			1,269
Shares repurchased to settle tax withholding obligations	(189	)	(19		)	(1,778		)	—			—			—	—			(1,797		)	—			(1,797		)
Directors' deferred compensation	1		—			12			—			—			—	—			12			—			12
Stock-based compensation income tax benefits	—		—			734			—			—			—	—			734			—			734
Balances as of September 25, 2015	30,835		$	3,083		$	191,536		$	(41,447	)	$	(80	)	3	$	(33	)	$	153,059		$	(399	)	$	152,660

	TRC Companies, Inc. Stockholders' Equity
												Accumulated							Total
	Common Stock					Additional						Other			Treasury Stock				TRC			Non-
	Number					Paid-in			Accumulated			Comp.			Number				Stockholders'			Controlling		Total
	of Shares		Amount			Capital			Deficit			Loss			of Shares	Amount			Equity			Interest		Equity
Balances as of July 1, 2016	31,087		$	3,109		$	195,156		$	(45,898	)	$	(71	)	3	$	(33	)	$	152,263		$	552	$	152,815
Net income	—		—			—			3,639			—			—	—			3,639			20		3,659
Other comprehensive loss	—		—			—			—			(27		)	—	—			(27		)	—		(27		)
Stock-based compensation	275		28			1,429			—			—			—	—			1,457			—		1,457
Shares repurchased to settle tax withholding obligations	(108	)	(11		)	(808		)	—			—			—	—			(819		)	—		(819		)
Directors' deferred compensation	4		—			25			—			—			—	—			25			—		25
Balances as of September 30, 2016	31,258		$	3,126		$	195,802		$	(42,259	)	$	(98	)	3	$	(33	)	$	156,538		$	572	$	157,110

See accompanying notes to condensed consolidated financial statements.

7

TRC COMPANIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except per share data)

(Unaudited)

Note 1. Company Background and Basis of Presentation

TRC Companies, Inc., through its subsidiaries (collectively, the "Company"), provides integrated engineering, consulting, and construction management services. Its project teams help its commercial and governmental clients implement environmental, power, infrastructure and oil and gas related projects from initial concept to delivery and operation. The Company provides its services almost entirely in the United States of America.

The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been omitted pursuant to those rules and regulations, but the Company's management believes that the disclosures included herein are adequate to make the information presented not misleading. The condensed consolidated financial statements include the accounts of the Company and all of its subsidiaries in which a controlling interest is maintained. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2016.

Note 2. New Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board ("FASB") issued an accounting standards update which simplifies employee share-based payment accounting. This standard simplifies the income tax consequences, accounting for forfeitures and classification on the statement of cash flows. The standard requires that, prospectively, all tax effects related to share-based payments be made through the income statement at the time of settlement as opposed to excess tax benefits being recognized in additional paid-in-capital under the current guidance. The standard also removes the requirement to delay recognition of a tax benefit until it reduces current taxes payable. This change is required to be applied on a modified retrospective basis, with a cumulative-effect adjustment to opening retained earnings. Additionally, all tax related cash flows resulting from share-based payments are to be reported as operating activities on the statement of cash flows, a change from the current requirement to present tax benefits as an inflow from financing activities and an outflow from operating activities. Finally, entities will be allowed to withhold an amount up to the employees’ maximum individual tax rate (as opposed to the minimum statutory tax rate) in the relevant jurisdiction without resulting in liability classification of the award. The change in withholding requirements will be applied on a modified retrospective approach. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company adopted this standard effective for its first quarter of fiscal 2017. The impact of the early adoption resulted in the following:

• The Company recorded a tax deficiency of $6 within income tax expense for the three months ended September 30, 2016 related to the tax shortfall on share based awards. Prior to adoption this amount would have been recorded as a decrease of capital in excess of par value. This change could create volatility in the Company's effective tax rate.

• The Company no longer reflects the cash received from the excess tax benefit within cash flows from financing activities but instead now reflects this benefit within cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows. The Company elected to apply this change in presentation prospectively and thus prior periods have not been adjusted.

• The Company elected not to change its policy on accounting for forfeitures and continues to estimate the total number of awards for which the requisite service period will not be rendered.

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• The Company’s statutory withholding requirements have been updated to allow withholding up to the Company's maximum statutory withholding requirements in relevant jurisdictions.

• The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of our diluted earnings per share for the three months ended September 30, 2016. This increased diluted weighted average common shares outstanding by less than 24 shares for the period.

In February 2016, the FASB issued an accounting standards update which will replace most existing lease accounting guidance. This standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. This standard will be effective for the Company's fiscal year beginning July 1, 2019. Early adoption is permitted and should be applied using a modified retrospective approach.   The Company is in the process of evaluating the potential impacts of this standard on its condensed consolidated financial statements and related disclosures, including potential early adoption.

In May 2014, the FASB issued an accounting standards update that replaces existing revenue recognition guidance. The updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In March 2016, the FASB further clarified the implementation guidance on principal versus agent considerations. The new standard will be effective for the Company's fiscal year beginning July 1, 2018. Early adoption is permitted under this standard for annual periods beginning after December 15, 2016, and it is to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company has not yet selected a transition method and is currently evaluating the effect the standard will have on its condensed consolidated financial statements.

Note 3. Fair Value Measurements

The Company's financial assets or liabilities are measured using inputs from the three levels of the fair value hierarchy. The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The three levels are as follows:

Level 1 Inputs - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Generally, this includes debt and equity securities and derivative contracts that are traded on an active exchange market (e.g., the New York Stock Exchange) as well as certain U.S. Treasury and U.S. Government and agency mortgage-backed securities that are highly liquid and are actively traded in over-the-counter markets.

Level 2 Inputs - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, credit risks) or can be corroborated by observable market data.

Level 3 Inputs - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect the Company's own assumptions about the assumptions that market participants would use.

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The following tables present the level within the fair value hierarchy at which the Company's financial assets and certain liabilities were measured on a recurring basis as of September 30, 2016 and June 30, 2016:

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	72	$	—	$	—	$	72
Certificates of deposit	—		106		—		106
Municipal bonds	—		543		—		543
Corporate bonds	—		344		—		344
U.S. Government bonds	—		218		—		218
U.S. Treasury Notes	1,995		—		—		1,995
Money market accounts and cash deposits	6,399		—		—		6,399
Total assets	$	8,466	$	1,211	$	—	$	9,677
Contingent consideration	$	—	$	—	$	90	$	90
Total liabilities	$	—	$	—	$	90	$	90

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of June 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	71	$	—	$	—	$	71
Certificates of deposit	—		107		—		107
Municipal bonds	—		547		—		547
Corporate bonds	—		439		—		439
U.S. Government bonds	—		219		—		219
U.S. Treasury Notes	2,009		—		—		2,009
Money market accounts and cash deposits	6,476		—		—		6,476
Total assets	$	8,556	$	1,312	$	—	$	9,868
Contingent consideration	$	—	$	—	$	233	$	233
Total liabilities	$	—	$	—	$	233	$	233

A majority of the Company's investments are priced by pricing vendors and are generally Level 1 or Level 2 investments, as these vendors either provide a quoted market price in an active market or use observable input for their pricing without applying significant adjustments. Broker pricing is used mainly when a quoted price is not available, the investment is not priced by the pricing vendors, or when a broker price is more reflective of fair value in the market in which the investment trades. The Company's broker priced investments are classified as Level 2 investments because the broker prices the investment based on similar assets without applying significant adjustments. The Company's restricted investment financial assets as of September 30, 2016 and June 30, 2016 are included within current and long-term restricted investments on the condensed consolidated balance sheets.

The Company's long-term debt is not measured at fair value in the condensed consolidated balance sheets. The fair value of debt is the estimated amount the Company would have to pay to transfer its debt, including any premium or discount attributable to the difference between the stated interest rate and market rate of interest at the balance sheet date. Fair values are based on valuations of similar debt at the balance sheet date and supported by observable market transactions when available: Level 2 of the fair value hierarchy.  At September 30, 2016 and June 30, 2016 the fair value of the Company's debt was not materially different than its carrying value.

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Reclassification adjustments for realized gains or losses from available for sale restricted investment securities out of accumulated other comprehensive income are included in the condensed consolidated statements of operations within the insurance recoverables and other income line item.

The Company's contingent consideration liabilities, included in other accrued liabilities on the condensed consolidated balance sheets, are associated with the acquisitions made in the fiscal year ended June 30, 2015. The liabilities are measured at fair value using a probability weighted average of the potential payment outcomes that would occur should certain contract metrics be reached. There is no market data available to use in valuing the contingent consideration; therefore, the Company developed its own assumptions related to the achievement of the metrics to evaluate the fair value of these liabilities. As such, the contingent consideration is classified within Level 3 as described below.

Items classified as Level 3 within the valuation hierarchy, consisting of contingent consideration liabilities related to recent acquisitions, were valued based on various estimates, including probability of success, discount rates and amount of time until the conditions of the contingent payments are achieved. The table below presents a roll-forward of the contingent consideration liabilities valued using Level 3 inputs:

Contingent consideration balance at July 1, 2016	$	233
Decrease of liability related to re-measurement of fair value	(143		)
Contingent consideration balance at September 30, 2016	$	90

Note 4. Stock-Based Compensation

The Company has two plans under which outstanding stock-based awards have been issued: the TRC Companies, Inc. Restated Stock Option Plan (the "Restated Plan"), and the Amended and Restated 2007 Equity Incentive Plan (the "2007 Plan"), (collectively "the Plans"). The Company issues new shares or may utilize treasury shares, when available, to satisfy awards under the Plans. Awards are made by the Compensation Committee of the Board of Directors; however, the Compensation Committee has delegated to the Chief Executive Officer ("CEO") the authority to grant awards for up to 10 shares to employees subject to a limitation of 100 shares in any 12 month period.

Stock-based awards under the Plans consist of stock options, restricted stock awards ("RSA's"), restricted stock units ("RSU's") and performance stock units ("PSU's"). As of September 30, 2016, 1,915 shares remained available for grants under the 2007 Plan.

Stock-Based Compensation

The Company measures stock-based compensation cost at the grant date based on the fair value of the award. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company's condensed consolidated statements of operations. Stock-based compensation expense includes the estimated effects of forfeitures, and estimates of forfeitures will be adjusted over the requisite service period to the extent actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized in the period of change and will also impact the amount of expense to be recognized in future periods.

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During the three months ended September 30, 2016 and September 25, 2015, the Company recognized stock-based compensation expense in cost of services ("COS") and general and administrative expenses within the condensed consolidated statements of operations as follows:

		Three Months Ended
		September 30, 2016		September 25, 2015
Cost of services		$	707	$	647
General and administrative expenses		750		622
	Total stock-based compensation expense	$	1,457	$	1,269

Stock Options

The Company uses the Black-Scholes option pricing model for determining the estimated grant date fair value for stock options. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. The risk-free interest rate assumption is based upon observed interest rates appropriate for the expected life of the employee stock options. The average expected life is based on the contractual term of the option and expected employee exercise and historical post-vesting employment termination experience. The Company estimates the volatility of its stock using historical volatility in accordance with current accounting guidance. Management determined that historical volatility of TRC common stock is most reflective of market conditions and the best indicator of expected volatility. The dividend yield assumption is based on the Company's historical and expected dividend payouts. There were no stock options granted during the three months ended September 30, 2016 and September 25, 2015.

A summary of stock option activity for the three months ended September 30, 2016 under the Plans is as follows:

					Weighted-
					Average
			Weighted-		Remaining
			Average		Contractual	Aggregate
			Exercise		Term	Intrinsic
	Options		Price		(in years)	Value
Outstanding options as of June 30, 2016 (85 exercisable)	85		$	8.28
Options expired	(1	)	$	9.80
Outstanding options as of September 30, 2016	84		$	8.26	0.5	$	61
Options exercisable as of September 30, 2016	84		$	8.26	0.5	$	61
Options vested and expected to vest as of September 30, 2016	84		$	8.26	0.5	$	61

The aggregate intrinsic value is measured using the fair market value at the date of exercise (for options exercised) or as of September 30, 2016 (for outstanding options), less the applicable exercise price. The closing price of the Company's common stock on the New York Stock Exchange was $8.67 as of September 30, 2016. The total intrinsic value of options exercised for the three months ended September 30, 2016 and September 25, 2015 was $0 and $87, respectively. The total proceeds received from option exercises for the three months ended September 30, 2016 and September 25, 2015 was $0 and $31, respectively.

Restricted Stock Awards

Compensation expense for RSA's is recognized ratably over the vesting term, which is generally four years. The fair value of the RSA's is determined based on the closing market price of the Company's common stock on the grant date.

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There was 1 non-vested RSA as of September 30, 2016. There were no RSA's granted during the three months ended September 30, 2016. As of September 30, 2016, there was $1 of total unrecognized compensation expense related to unvested RSA's under the Plans, and this expense is expected to be recognized over a weighted-average period of 0.2 years.

Restricted Stock Units

Compensation expense for RSU's is recognized ratably over the vesting term, which is generally four years. The fair value of RSU's is determined based on the closing market price of the Company's common stock on the grant date.

A summary of non-vested RSU activity for the three months ended September 30, 2016 is as follows:

			Weighted-
	Restricted		Average
	Stock		Grant Date
	Units		Fair Value
Non-vested units as of June 30, 2016	904		$	8.24
Units granted	517		$	6.17
Units vested	(132	)	$	7.85
Units forfeited	(23	)	$	10.71
Non-vested units as of September 30, 2016	1,266		$	7.34

RSU grants totaled 517 shares with a total weighted-average grant date fair value of $3,188 during the three months ended September 30, 2016. RSU grants totaled 13 shares with a total weighted-average grant date fair value of $150 during the three months ended September 25, 2015. The total fair value of RSU's vested during the three months ended September 30, 2016 was $966. The total fair value of RSU's vested during the three months ended September 25, 2015 was $2,781.

As of September 30, 2016, there was $7,862 of total unrecognized compensation expense related to unvested RSU's under the Plans, and this expense is expected to be recognized over a weighted-average period of 3.2 years.

Performance Stock Units

Compensation expense for PSU's is recognized ratably over the vesting term, which is generally four years, if and when the Company concludes that it is probable that the performance condition will be achieved. The Company reassesses the probability of vesting at each reporting period for awards with performance conditions and adjusts compensation expense based on its probability assessment. The fair value of the PSU's is determined based on the closing market price of the Company's common stock on the grant date.

The number of PSU's earned is determined based on the Company's performance against predefined targets. The range of payout is zero to 150% of the number of granted PSU's. The number of PSU's earned is determined based on actual performance at the end of the performance period. PSU grants totaled 512 and 0 with a total weighted-average grant date fair value of $3,152 and $0 during the three months ended September 30, 2016 and September 25, 2015, respectively. The total fair value of PSU's vested during the three months ended September 30, 2016, was $1,095. The total fair value of PSU's vested during the three months ended September 25, 2015, was $2,191.

At September 30, 2016, there was $7,452 of total unrecognized compensation expense related to non-vested PSU's; this expense is expected to be recognized over a weighted-average period of 2.8 years.

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A summary of non-vested PSU activity for the three months ended September 30, 2016 is as follows:

						Weighted-
	PSU			Total		Average
	Original		PSU	PSU		Grant Date
	Awards		Adjustments (1)	Awards		Fair Value
Non-vested units as of June 30, 2016	895		—	895		$	8.74
Units granted	512		—	512		$	6.15
Units vested	(142	)	—	(142	)	$	7.72
Units forfeited	(40	)	—	(40	)	$	8.24
Non-vested units as of September 30, 2016	1,225		—	1,225		$	7.79

(1) Represents the additional number of PSU's issued based on the final performance condition achieved at the end of the respective performance period.

Note 5. Earnings per Share

Basic earnings per share ("EPS") is computed based on the weighted-average number of shares of common stock outstanding during the period. Diluted EPS is computed using the treasury stock method for stock options, warrants, non-vested restricted stock awards and units, and non-vested performance stock units. The treasury stock method assumes conversion of all potentially dilutive shares of common stock with the proceeds from assumed exercises used to hypothetically repurchase stock at the average market price for the period. Diluted EPS is computed by dividing net income applicable to the Company by the weighted-average common shares and potentially dilutive common shares that were outstanding during the period.

The following table sets forth the computations of basic and diluted EPS for the three months ended September 30, 2016 and September 25, 2015:

	Three Months Ended
	September 30, 2016		September 25, 2015
Net income applicable to TRC Companies, Inc.	$	3,639	$	4,492
Basic weighted-average common shares outstanding	31,149		30,635
Effect of dilutive stock options, RSA's, RSU's and PSU's	452		683
Diluted weighted-average common shares outstanding	31,601		31,318
Earnings per common share applicable to TRC Companies, Inc.
Basic earnings per common share	$	0.12	$	0.15
Diluted earnings per common share	$	0.12	$	0.14
Anti-dilutive stock options, RSA's, RSU's and PSU's, excluded from the calculation	1,611		821

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Note 6. Accounts Receivable

The current portion of accounts receivable as of September 30, 2016 and June 30, 2016, were comprised of the following:

		September 30, 2016			June 30, 2016
Billed		$	101,430		$	90,194
Unbilled		72,370			64,954
Retainage		3,050			2,429
	Total accounts receivable - gross	176,850			157,577
Less allowance for doubtful accounts		(8,384		)	(8,297		)
	Total accounts receivable, less allowance for doubtful accounts	$	168,466		$	149,280

Note 7. Other Accrued Liabilities

As of September 30, 2016 and June 30, 2016, other accrued liabilities were comprised of the following:

		September 30, 2016		June 30, 2016
Contract costs		$	40,134	$	40,343
Legal accruals		5,325		5,232
Lease obligations		5,439		5,564
Other		6,643		6,887
	Total other accrued liabilities	$	57,541	$	58,026

Note 8. Business Acquisitions, Goodwill and Other Intangible Assets

Fiscal 2016 Acquisition

On November 30, 2015, the Company acquired the Professional Services business ("Oil and Gas") of Willbros Group ("Willbros") in an all cash transaction. The $124,498 purchase price consisted of (i) an initial cash payment of $119,955 paid at closing, and, (ii) a second cash payment due of $7,500 payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016, net of a working capital adjustment due from Willbros of $2,957. The second cash payment was made in two tranches, with $2,354 paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement. Goodwill of $60,294, all of which is expected to be tax deductible, and other intangible assets of $44,500 were recorded as a result of this acquisition.

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The following summarizes the estimated fair values of the Oil and Gas assets acquired and liabilities assumed at the acquisition date, as well as measurement period adjustments:

			November 30, 2015 (As Initially Reported)			Measurement Period Adjustments			November 30, 2015 (As Adjusted)
Cash and cash equivalents			$	355		$	—		$	355
Accounts receivable			26,406			1,857			28,263
Prepaid expenses and other current assets			7,276			(48		)	7,228
Property and equipment			3,552			—			3,552
Identifiable intangible assets:
	Customer relationships and backlog		43,500			—			43,500
	Internally developed software		1,000			—			1,000
		Total identifiable intangible assets	44,500			—			44,500
Goodwill			64,673			(4,379		)	60,294
Other non-current assets			20,683			—			20,683
Accounts payable			(2,587		)	43			(2,544		)
Accrued compensation and benefits			(7,199		)	(2		)	(7,201		)
Other accrued liabilities			(5,210		)	100			(5,110		)
Current portion of long-term debt			(6,447		)	(38		)	(6,485		)
Long-term debt, net of current portion			(18,547		)	—			(18,547		)
Non-controlling interest			$	—		$	(490	)	$	(490	)
	Net assets acquired		$	127,455		$	(2,957	)	$	124,498

Customer relationships and backlog represent the fair value of existing contracts and the underlying customer relationships. The backlog has a 1 year life and customer relationships have lives ranging from 12 years to 15 years (weighted average lives of 6 years). The internally developed software has a life of approximately 5 years (weighted average life of 5 years).

The goodwill recognized is attributable to the future strategic growth opportunities arising from the acquisition, Oil and Gas's highly skilled assembled workforce, which does not qualify for separate recognition, and the expected cost synergies of the combined operations.

The unaudited pro forma financial information summarized in the following table gives effect to the Oil and Gas acquisition assuming it occurred on July 1, 2014. These unaudited pro forma operating results do not assume any impact from revenue, cost or other operating synergies that are expected as a result of the acquisition. Pro forma adjustments have been made to reflect amortization of the identified intangible assets for the related periods, as well as the amortization of deferred debt issuance costs incurred. Identifiable intangible assets are being amortized on a basis approximating the economic value derived from those assets. These unaudited pro forma operating results are presented for illustrative purposes only and are not indicative of the operating results that would have been achieved had the acquisition occurred on July 1, 2014, nor does the information project results for any future period.

	Three Months Ended
	September 25, 2015
Gross revenue	$	184,033
Net service revenue	131,709
Net income applicable to TRC Companies, Inc.	2,986
Basic earnings per common share	$	0.10
Diluted earnings per common share	$	0.10

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Goodwill

The Company assesses goodwill for impairment on an annual basis as of each fiscal April period end, or at an interim date when events or changes in the business environment would more likely than not reduce the fair value of a reporting unit below its carrying value. As of September 30, 2016, the Company had $75,337 of goodwill, and does not believe there were any events or changes in circumstances since the last goodwill assessment as of April 29, 2016 that would indicate the fair value of goodwill was more likely than not reduced to below its carrying value. Accordingly, goodwill was not tested for impairment during the current fiscal quarter.

The carrying amount of goodwill for the three months ended September 30, 2016 by operating segment are as follows:

	Gross									Gross
	Balance,		Accumulated			Balance,				Balance,		Accumulated			Balance,
	July 1,		Impairment			July 1,		Additions /		September 30,		Impairment			September 30,
Operating Segment	2016		Losses			2016		Adjustments		2016		Losses			2016
Power	$	28,506	$	(14,506	)	$	14,000	$	—	$	28,506	$	(14,506	)	$	14,000
Environmental	40,889		(17,865		)	23,024		—		40,889		(17,865		)	23,024
Infrastructure	7,224		(7,224		)	—		—		7,224		(7,224		)	—
Oil and Gas	60,294		(21,981		)	38,313		—		60,294		(21,981		)	38,313
	$	136,913	$	(61,576	)	$	75,337	$	—	$	136,913	$	(61,576	)	$	75,337

Other Intangible Assets

Identifiable intangible assets as of September 30, 2016 and June 30, 2016 are included in other assets on the condensed consolidated balance sheets and were comprised of:

	September 30, 2016							June 30, 2016
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
Identifiable intangible assets	Amount		Amortization			Amount		Amount		Amortization			Amount
With determinable lives:
Customer relationships	$	59,218	$	(17,374	)	$	41,844	$	59,218	$	(14,933	)	$	44,285
Contract backlog	900		(750		)	150		900		(525		)	375
Technology	1,000		(167		)	833		1,000		(117		)	883
	61,118		(18,291		)	42,827		61,118		(15,575		)	45,543
With indefinite lives:
Engineering licenses	426		—			426		426		—			426
	$	61,544	$	(18,291	)	$	43,253	$	61,544	$	(15,575	)	$	45,969

Identifiable intangible assets with determinable lives are amortized over their estimated useful lives and are also reviewed for impairment if events or changes in circumstances indicate that their carrying amount may not be realizable.

Identifiable intangible assets with determinable lives are being amortized over a weighted-average period of approximately 7 years. The weighted-average period of amortization is approximately 7 years for customer relationship assets. The amortization of intangible assets for the three months ended September 30, 2016 was $2,716. The amortization of intangible assets for the three months ended September 25, 2015 was $840.

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Estimated amortization expense of intangible assets for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

Fiscal Year		Amount
2017		$	7,443
2018		9,183
2019		8,367
2020		7,821
2021		7,274
2022 and Thereafter		2,739
	Total	$	42,827

On an annual basis, or more frequently if events or changes in circumstances indicate that the asset might be impaired, the fair value of the indefinite-lived intangible assets is evaluated by the Company to determine if an impairment charge is required. The Company performed its most recent annual impairment assessment as of April 29, 2016, which resulted in no impairments to intangible assets. There were no events or changes in circumstances that would indicate the fair value of intangible assets was reduced to below its carrying value during the three months endedSeptember 30, 2016, and therefore intangible assets were not tested for impairment.

Note 9. Long-Term Debt and Capital Lease Obligations

Revolving Credit Facility

On November 30, 2015, the Company entered into a five-year credit agreement (the “Credit Agreement”) with Citizens Bank, N.A. as lender, LC issuer, administrative agent, sole lead arranger, and sole book runner; BMO Harris Bank, N.A. as lender, LC issuer and syndication agent; KeyBank, N.A. as lender and document agent, and five other banks as lenders. The Credit Agreement provides the Company with an aggregate borrowing capacity of $175,000, consisting of a $100,000five-year secured revolving credit facility (“Revolving Facility”) with a sub-limit of $15,000 available for the issuance of letters of credit, as well as a five-year secured $75,000 term loan (“Term Loan”).

The proceeds of the Term Loan, together with cash on hand and proceeds from borrowing under the Revolving Facility, were used to pay the purchase price for Willbros Professional Services ("Oil and Gas") and to fund transaction costs incurred in connection with the Oil and Gas acquisition. The Revolving Facility will also be available for working capital and general corporate purposes. The Revolving Facility includes borrowing capacity for letters of credit and for borrowings on same-day notice, referred to as “swingline loans.” Borrowings under the Revolving Facility are subject to the satisfaction of customary conditions, including absence of defaults and accuracy of representations and warranties. The Company may request an increase in the amount of the Credit Agreement up to an additional $75,000, which may be through additional term or revolving loans.

Borrowings outstanding under the Revolving Facility will mature on November 30, 2020. The Term Loan amortizes in quarterly installments payable on the last day of each March, June, September, and December, commencing on March 31, 2016 in amounts equal to 1.875% of the term loan made or outstanding, with the balance payable on November 30, 2020 (the "Term Loan Maturity Date.") In addition, the Company is required, subject to certain exceptions, to make payments on the Term Loan (a) based on a stated percentage of Excess Cash Flow, either 50% or 0% depending on whether the the Company's consolidated leverage is above or below 2 times adjusted EBITDA as defined in the Credit Agreement, (b) in an amount of 100% of net cash proceeds from asset sales subject to certain reinvestment rights, (c) in an amount of 100% of net cash proceeds of any issuance of debt other than debt permitted to be incurred under the Credit Agreement, and (d) in an amount of 100% of net cash proceeds from events of loss subject to certain reinvestment rights. The borrowings under the Credit Agreement may be reduced, in whole or in part, without premium or penalty.

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Amounts outstanding under the Credit Agreement bear interest at the Base Rate (as defined, generally the prime rate) plus a margin of 0.50% to 1.25%, or at the Eurodollar Rate (as defined, generally the LIBOR rate) plus a margin of 1.50% to 2.25%, based on the Company's Leverage Ratio (as defined). In addition to these borrowing rates, there is a commitment fee which ranges from 0.20% to 0.375% on any unused commitments. The applicable fees for issuance of letters of credit under the Revolving Facility is a range from 1.50% to 2.25%.

The Company’s obligations under the Credit Agreement are secured by a pledge of substantially all of its assets and guaranteed by its principal operating subsidiaries. The Credit Agreement also contains cross-default provisions which become effective if the Company defaults on other indebtedness.

The Credit Agreement contains various customary restrictive covenants that limit the Company's ability to, among other things: incur additional indebtedness including guarantees; enter into sale/leaseback transactions; make investments, loans or acquisitions; grant or incur liens on its assets; sell its assets; engage in mergers, consolidations, liquidations or dissolutions; engage in transactions with affiliates; and make restricted payments. Under the Credit Agreement the Company is required to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00 and to not permit its leverage ratio to exceed 3.00 to 1.00. The Credit Agreement also limits the payment of cash dividends to $10,000 in aggregate during its term.

On November 30, 2015, the Company borrowed $102,000 under the Credit Agreement to partially fund the Oil and Gas acquisition. The borrowing was comprised of a full borrowing of the $75,000 term loan and a $27,000 borrowing under the Revolving Facility. Borrowings under the Term Loan bear interest at a stated rate of 2.02% and have an effective interest rate of 2.07% at September 30, 2016. As of September 30, 2016 the Company had zero borrowings outstanding under the Credit Agreement's Revolving Facility and $70,781 outstanding under the Term Loan. Funds available to borrow under the Credit Agreement, after consideration of the letters of credit outstanding, were $97,346 at September 30, 2016.

In accounting for the transaction costs incurred in conjunction with the Credit Agreement, the Company allocated the total costs incurred based on the relative fair values of the Revolving Facility and Term Loan. A total of $1,916 and $1,332 were allocated to the Revolving Facility and Term Loan, respectively.

As of September 30, 2016, the Term Loan consisted of the following:

Current portion of Term Loan	$	5,625
Long-term portion of Term Loan	$	65,156
Less: Debt issuance costs	(1,074		)
Net long-term carrying amount	$	64,082

The scheduled principal amounts due under the Company’s Term Loan obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years are as follows:

2017		$	4,219
2018		5,625
2019		5,625
2020		5,625
2021		49,687
	Total	$	70,781

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Contractor-owned, contractor-operated (CoCo) facility debt

As of September 30, 2016, the Company had approximately $20,793 of debt obligations ("CoCo" debt) assumed in the Oil and Gas acquisition, of which $7,656 was current.  A third party finance company had provided financing to Oil and Gas in conjunction with the construction of fueling facilities for the federal government pursuant to three government contracts. Upon acceptance of the constructed facilities, the federal government pays Oil and Gas in equal monthly installments over the subsequent five years. Therefore, as of September 30, 2016, the Company also had recorded approximately $20,793 of receivables which were acquired in the transaction, of which $7,656 was current. These amounts were recorded within other assets and represent the amount due from the federal government for the construction of the fueling facilities.

As of September 30, 2016, the government has provided acceptance and final funding on all three contracts.

The principal amounts due under the Company’s remaining CoCo debt obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

2017		$	5,974
2018		5,734
2019		3,717
2020		3,980
2021		1,388
	Total	$	20,793

Other Notes Payable

In July 2016, the Company financed $3,838 of insurance premiums payable in seven equal monthly installments of $552 each, including a finance charge of 2.19%. As of September 30, 2016, the balance outstanding under this agreement was $2,199.

In conjunction with the Oil and Gas acquisition, the Company was required to remit a second cash payment of $7,500 payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016. The second cash payment was made in two tranches, with $2,354 paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement.

Note 10. Variable Interest Entity

In determining whether the Company is the primary beneficiary of an entity, it considers a number of factors, including its ability to direct the activities that most significantly affect the entity's economic success, the Company's contractual rights and responsibilities under the arrangement and the significance of the arrangement to each party. These considerations impact the way the Company accounts for its existing collaborative and joint venture relationships and determines the consolidation of companies or entities with which the Company has collaborative or other arrangements.

WBA

Willbros Engineers LLC, which the Company acquired in fiscal 2016, was party to an option and service arrangement with the equity owners of WBA, a limited liability company. WBA is considered a VIE due to the lack of decision-making rights by its equity holders. The Company consolidates the operations of WBA, as it retains the contractual power to direct the activities of WBA which most significantly and directly impact its economic performance. The Company also has the obligation to absorb losses and the right to receive residual returns of WBA. The activity of WBA is not significant to the overall performance of the Company. The assets of WBA are available for the Company's general business use outside the context of WBA. In consolidation, as of September 30, 2016, $362 of cash and cash equivalents, $262 of accounts receivables and $3 of other current liabilities were attributable to WBA.

20

While the Company is currently in the process of winding down the operations of WBA, it has an obligation to fund operating activities not covered by WBA’s available cash and cash flow from operations. During fiscal year 2017, the Company provided $7 of financial support to WBA. The Company does not expect ongoing funding obligations to be material.

Note 11. Income Taxes

The Company's effective tax rate was approximately 32.1% and 41.3% for the three months ended September 30, 2016 and September 25, 2015 respectively. The primary reconciling items between the federal statutory rate of 35.0% and the Company's overall effective tax rate for the three months ended September 30, 2016 were the effect of state income taxes offset by tax benefits related to the U.S. Research and Development credit, U.S. Domestic Production Activities deduction and the effective settlement of uncertain tax positions. The primary reconciling items between the federal statutory rate of 35.0% and the Company's overall effective tax rate for the three months ended September 25, 2015 were the effect of state income taxes.

As of September 30, 2016, the recorded liability for uncertain tax positions under the measurement criteria of Accounting Standards Codification ("ASC") Topic 740, Income Taxes, was $903. The effective settlement of uncertain tax positions resulted in a decrease in the recorded liability of $1,344 during the three months ended September 30, 2016, which resulted in a net decrease to the provision for income taxes of $294. The Company does not expect the amount of unrecognized tax benefits to materially change within the next twelve months.

As a result of the early adoption of ASU 2016-09 in the three months ended September 30, 2016, excess tax benefits and tax deficiencies will be classified to the statement of operations prospectively instead of additional paid-in capital. The Company's effective tax rate for the three months ended September 30, 2016 was not materially impacted by the adoption of ASU 2016-09. The Company recorded a net tax deficiency of $6 during the three months ended September 30, 2016 which discretely increased the provision for income taxes.

In the first quarter of fiscal year 2017, the IRS concluded its income tax examination for fiscal year 2014. No adjustments were proposed.

Note 12. Operating Segments

To more clearly communicate the Company's capabilities and focus to the marketplace, beginning in fiscal 2017, the Company renamed its Energy segment “Power” and its Pipeline Services segment “Oil and Gas.” The Company manages its business under the following four operating segments:

Power (formerly Energy): The Power operating segment provides services to a range of clients including energy companies, power utilities, other commercial entities, and state and federal government entities. The Company's services include program management, engineer/procure/construct projects, design, and consulting. The Company's typical projects involve upgrades, design and new construction for electric transmission and distribution systems and substations; energy efficiency program design and management; and renewable energy development and power generation.

Environmental: The Environmental operating segment provides services to a wide range of clients including industrial, transportation, energy and natural resource companies, as well as federal, state and municipal agencies. The Environmental operating segment is organized to focus on key areas of demand including: environmental management of buildings and facilities; air quality measurements and modeling of potential air pollution impacts; water quality and water resource management; assessment and remediation of contaminated sites and buildings; hazardous waste management; construction monitoring, inspection and management; environmental, health and safety management and sustainability advisory services; compliance auditing and strategic due diligence; environmental licensing and permitting of a wide variety of projects; and natural and cultural resource assessment, protection and management.

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Infrastructure: The Infrastructure operating segment provides services related to the expansion of infrastructure capacity and the rehabilitation of overburdened and deteriorating infrastructure systems. The Company's client base is predominantly state and municipal governments as well as select commercial developers. In addition, the Company provides infrastructure services on projects originating in its Power and Environmental operating segments. Primary services include: roadway, bridge and related surface transportation design; structural design and inspection of bridges; program management; construction engineering inspection and construction management for roads and bridges; civil engineering for municipalities and public works departments; geotechnical engineering services; and security assessments, design and construction management.

Oil & Gas (formerly Pipeline Services): The Oil & Gas operating segment provides pipeline and facilities engineering; engineer, procure, and construct ("EPC") services; engineer, procure, construct and management ("EPCm") services; field services and integrity services to the oil and gas transmission and midstream markets, as well as at government facilities. The Company specializes in providing engineering services to assist clients in designing, engineering and constructing or expanding pipeline systems, compressor stations, pump stations, fuel storage facilities, terminals, and field gathering and production facilities. The Company's expertise extends to the engineering of a wide range of project peripherals, including various types of support buildings and utility systems, power generation and electrical transmission systems, communications systems, fire protection, water and sewage treatment, water transmission, roads and railroad sidings. The Company also provides project management, engineering and material procurement services to the refining industry and government agencies, including mechanical, civil, structural, electrical instrumentation/controls and environmental engineering. The Company provides full-service integrity management program offerings including program development, data services, risk analysis, corrosion evaluation, integrity engineering and integrity construction services. The Company is partnered with Google to provide a cloud-based pipeline life-cycle integrity management solution, Integra Link™, which utilizes Google’s geospatial technology platform to help oil and gas pipeline companies visualize and utilize their data and information.

The Company's chief operating decision maker ("CODM") is its CEO. The Company's CEO manages the business by evaluating the financial results of the four operating segments focusing primarily on segment revenue and segment profit. The Company utilizes segment revenue and segment profit because it believes they provide useful information for effectively allocating resources among operating segments; evaluating the health of its operating segments based on metrics that management can actively influence; and gauging its investments and its ability to service, incur or pay down debt. Specifically, the Company's CEO evaluates segment revenue and segment profit and assesses the performance of each operating segment based on these measures, as well as, among other things, the prospects of each of the operating segments and how they fit into the Company's overall strategy. The Company's CEO then decides how resources should be allocated among its operating segments. The Company does not track its assets by operating segment, and consequently, it is not practical to show assets by operating segment. Segment profit includes all operating expenses except the following: costs associated with providing corporate shared services (including certain depreciation and amortization), goodwill and intangible asset write-offs, and stock-based compensation expense. Depreciation expense is primarily allocated to operating segments based upon their respective use of total operating segment office space. Assets solely used at the Corporate level are not allocated to the operating segments. Inter-segment balances and transactions are not material. The accounting policies of the operating segments are the same as those for the Company as a whole, except as discussed herein.

On July 1, 2016 the Company made certain changes to its management reporting structure which resulted in a change to the composition of the Infrastructure operating segment. Certain corporate employees were transferred to the Infrastructure operating segment. As a result, beginning in fiscal year 2017 the Company reports its financial performance based on the current reporting structure. The Company has recast certain prior period amounts to conform to the way it internally manages and monitors segment performance. These changes had no impact on consolidated net income or cash flows and were not material to the segment measurements presented.

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The following tables present summarized financial information for the Company's operating segments (for the periods noted below): 

	Power		Environmental		Infrastructure		Oil & Gas		Total
Three months ended Sept. 30, 2016:
Gross revenue	$	56,995	$	73,936	$	22,913	$	26,638	$	180,482
Net service revenue	37,100		48,894		16,630		21,338		123,962
Segment profit	7,967		9,052		4,309		1,371		22,699
Depreciation	444		645		138		352		1,579
Amortization	248		274		—		2,067		2,589
Three months ended Sept. 25, 2015:
Gross revenue	$	39,237	$	75,843	$	19,970	$	—	$	135,050
Net service revenue	34,338		51,564		13,562		—		99,464
Segment profit	7,312		9,982		2,893		—		20,187
Depreciation	465		624		97		—		1,186
Amortization	300		365		—		—		665

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	Three Months Ended
Gross revenue	September 30, 2016			September 25, 2015
Gross revenue from reportable operating segments	$	180,482		$	135,050
Reconciling items (1)	369			409
Total consolidated gross revenue	$	180,851		$	135,459
Net service revenue
Net service revenue from reportable operating segments	$	123,962		$	99,464
Reconciling items (1)	343			699
Total consolidated net service revenue	$	124,305		$	100,163
Income from operations before taxes
Segment profit from reportable operating segments	$	22,699		$	20,187
Corporate shared services (2)	(14,949		)	(9,954		)
Stock-based compensation expense	(1,457		)	(1,269		)
Unallocated acquisition and integration expenses	—			(878		)
Unallocated depreciation and amortization	(336		)	(413		)
Interest income	278			—
Interest expense	(845		)	(28		)
Total consolidated (loss) income from operations before taxes	$	5,390		$	7,645
Acquisition and integration expenses
Acquisition and integration expenses from reportable operating segments	$	—		$	—
Unallocated acquisition and integration expenses	—			878
Total consolidated acquisition and integration expenses	$	—		$	878
Depreciation and amortization
Depreciation and amortization from reportable operating segments	$	4,168		$	1,851
Unallocated depreciation and amortization	336			413
Total consolidated depreciation and amortization	$	4,504		$	2,264

(1) Amounts represent certain unallocated corporate amounts not considered in the CODM's evaluation of operating segment performance.

(2) Corporate shared services consist of centrally managed functions in the following areas: accounting, treasury, information technology, legal, human resources, marketing, internal audit and executive management such as the CEO and various executives. These costs and other items of a general corporate nature are not allocated to the Company’s four operating segments.

Note 13. Commitments and Contingencies

Exit Strategy Contracts

The Company has entered into a number of long-term contracts pursuant to its Exit Strategy program under which it is obligated to complete the remediation of environmental conditions at covered sites. The Company assumes the risk for remediation costs for pre-existing environmental conditions and believes that through in-depth technical analysis, comprehensive cost estimation and creative remedial approaches it is able to execute strategies which protect the

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Company's return on these projects. The Company's client pays a fixed price and, as additional protection, for a majority of the contracts the client also pays for a cleanup cost cap insurance policy. The policy, which includes the Company as a named or additional insured party, provides coverage for cost increases from unknown or changed conditions up to a specified maximum amount significantly in excess of the estimated cost of remediation. The Company believes that it is adequately protected from risk on these projects and that it is not likely that it will incur material losses in excess of applicable insurance. However, because several projects are near the term or financial limits of the insurance, the Company believes it is reasonably possible that events could occur under certain circumstances which could be material to the Company's consolidated financial statements. With respect to these projects, there is a wide range of potential outcomes that may result in costs being incurred beyond the limits or term of insurance, such as: (i) greater than expected volumes of contaminants requiring remediation; (ii) treatment systems requiring operation beyond the insurance term; and (iii) greater than expected allocable share of the ultimate remedy. The Company does not believe these outcomes are likely, and the exact nature, impact and duration of any such occurrence could vary due to a number of factors. Accordingly, the Company is unable to provide an estimate of potential loss with a reasonable degree of accuracy. Nevertheless, if these events were to occur, the Company believes that it is reasonably possible that the amount of costs currently accrued, which represents the Company's best estimate, could increase by as much as $25,000, of which $4,000 would be covered by insurance.

With respect to one of the projects noted above, the regulatory agency charged with oversight of the project approved a remedial plan that is more expensive than the remedy that had been proposed by the Company. A cost allocation among the potentially responsible parties has not been finalized. However, the Company (and the party from whom it assumed site responsibility) did not contribute in any way to the site contamination, and the Company believes that it has meritorious defenses to liability and that it will not ultimately be responsible for any material remedial costs attributable to the more costly selected remedy. Nevertheless, due to uncertainty over the cost allocation process, it is reasonably possible that the Company's recorded estimate could change. With respect to another one of these projects, the regulatory agency charged with oversight of the project selected a remedy that appears to be consistent with regulatory guidance and the Company’s estimates. However, until the final remedy is formally adopted following a public notice period, it remains reasonably possible that the selected remedial alternative could change and the related costs could increase. The Company's estimated share of the potential remedial cost changes related to these two projects range from $0 to $18,600.

The Company adjusts all of its recorded liabilities as further information develops or circumstances change. The Company is unable to accurately project the time period over which these amounts would ultimately be paid out, however the Company estimates that any potential payments could be made over a 1 to 5 year period.  

Contract Damages

The Company has entered into contracts which, among other things, require completion of the specified scope of work within a defined period of time or a defined budget. Certain of those contracts provide for the assessment of liquidated or other damages if certain project objectives are not met pursuant to the terms of the contract. At present, the Company does not believe a material assessment of such damages is reasonably possible.

Government Contracts

The Company's indirect cost rates applied to contracts with the U.S. Government and various state agencies are subject to examination and renegotiation. Contracts and other records of the Company with respect to federal contracts have been examined through June 30, 2008. The Company believes that adjustments resulting from such examination or renegotiation proceedings, if any, will not likely have a material impact on the Company's business, operating results, financial position and cash flows.

Insurance Captive

During fiscal 2016, the Company became a shareholder in a member-owned heterogeneous (various industries) group captive reinsurance company. The policies of the program are placed with a U.S. insurance carrier, which provides

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coverage for workers' compensation, general liability and auto liability, with a certain initial layer of loss being reinsured to the carrier by the captive. The Company’s annual premiums are actuarially determined based on historical loss experience, and also include administrative costs and fees. In addition, the captive is designed to have an acceptable level of risk sharing among its members. For a given policy period, if the Company’s actual loss experience is greater than the estimate, the Company is required to make additional payments to the captive up to a maximum predetermined level. If the Company’s loss experience is less than the estimate, the Company may receive a shareholder distribution, when declared by the captive's Board of Directors. The Company records any additional costs or distributions received from the captive in the period in which the Company is notified of the amount due or distribution to be received. The Company has not recorded any additional liability or receivable as of September 30, 2016.

Legal Matters

The Company and its subsidiaries are subject to claims and lawsuits typical of those filed against engineering and consulting companies. The Company carries liability insurance, including professional liability insurance, against such claims subject to certain deductibles and policy limits. Except as described herein, management is of the opinion that the resolution of these claims and lawsuits will not likely have a material effect on the Company's operating results, financial position and cash flows.

TRC Environmental Corporation v. LVI Group Services, Inc., United States District Court for the Western District of Texas, Austin Division 2014.TRC was the prime contractor on a project to demolish and decommission a power plant in Austin, Texas. LVI was a subcontractor on that project, and TRC sued LVI for approximately $3,000 for breaches in connection with LVI’s work. LVI filed a number of responsive pleadings in this lawsuit including a counterclaim for approximately $9,900. TRC believes that its claims against LVI are meritorious and that LVI’s counterclaim is without merit. Nevertheless, an adverse determination on LVI’s counterclaim could have a material adverse effect on the Company’s business, operating results, financial position and cash flows.

The Company records actual or potential litigation-related losses in accordance with ASC Topic 450 "Contingencies". As of September 30, 2016 and June 30, 2016, the Company had recorded litigation accruals of $4,627 and $4,869, respectively. The Company also had insurance recovery receivables related to the aforementioned litigation-related accruals of $2,254 and $2,661 as of September 30, 2016 and June 30, 2016, respectively.

The Company periodically adjusts the amount of such liabilities when such actual or potential liabilities are paid or otherwise discharged, new claims arise, or additional relevant information about existing or potential claims becomes available. The Company believes that it is reasonably possible that the amount of potential litigation-related liabilities could increase by as much as $11,300, of which $2,100 would be covered by insurance.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Three Months EndedSeptember 30, 2016 and September 25, 2015

Our fiscal quarters end on the last Friday of the quarter except for the last quarter of the fiscal year which always ends on June 30. The three months ended September 30, 2016 contained three more business days than the prior fiscal year period.

The following discussion of our results of operations and financial condition should be read in conjunction with our condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q and with our Annual Report on Form 10-K for the fiscal year ended June 30, 2016. This discussion contains forward-looking statements that are based upon current expectations and assumptions, and, by their nature, such forward-looking statements are subject to risks and uncertainties. We have attempted to identify such statements using words such as "may", "expects", "plans", "anticipates", "believes", "estimates", or other words of similar import. We caution the reader that there may be events in the future that management is not able to accurately predict or control which may cause actual results to differ materially from the expectations described in the forward-looking statements. The factors

26

described in the sections captioned "Critical Accounting Policies" and "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended June 30, 2016 as well as in this Form 10-Q provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations described in the forward-looking statements.

Overview

We are a firm that provides integrated engineering, consulting, and construction management services. Our project teams help our commercial and governmental clients implement environmental, power, infrastructure and oil and gas related projects from initial concept to delivery and operation. We provide our services almost entirely in the United States of America.

We generate revenue and cash flows from fees for professional and technical services. As a service company, we are more labor-intensive than capital-intensive. Our revenue and cash flow is driven by our ability to attract and retain qualified and productive employees, identify business opportunities, secure new and renew existing client contracts, provide outstanding service to our clients and execute projects successfully. Our income from operations is derived from our ability to generate revenue under our contracts in excess of our direct costs, subcontractor costs, other contract costs, and general and administrative ("G&A") expenses.

In the course of providing our services, we routinely subcontract services. Generally, these subcontractor costs are passed through to our clients and, in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and consistent with industry practice, are included in gross revenue. Because subcontractor services can change significantly from project to project, changes in gross revenue may not be indicative of business trends. Accordingly, we also report net service revenue ("NSR"), which is gross revenue less subcontractor costs and other direct reimbursable charges, and our discussion and analysis of financial condition and results of operations uses NSR as a primary point of reference.

Our cost of services ("COS") includes professional compensation and related benefits together with certain direct and indirect overhead costs such as rents, utilities and travel. Professional compensation represents the majority of these costs. Our G&A expenses are comprised primarily of our corporate headquarters costs related to corporate executive management, finance, accounting, information technology, administration and legal. These costs are generally unrelated to specific client projects and can vary as expenses are incurred to support corporate activities and initiatives.

Our revenue, expenses and operating results may fluctuate significantly from year to year as a result of numerous factors, including:

• Unanticipated changes in contract performance that may affect profitability, particularly with contracts that are fixed-price or have funding limits;

• Seasonality of the spending cycle, notably for state and local government entities, and the spending patterns of our commercial sector clients;

• Budget constraints experienced by our federal, state and local government clients;

• Divestitures or discontinuance of operating units;

• The timing and impact of acquisitions;

• Employee hiring, utilization and turnover rates;

• The number and significance of client contracts commenced and completed during the period;

• Creditworthiness and solvency of clients;

• The ability of our clients to terminate contracts without penalties;

• Delays incurred in connection with contracts;

• The size, scope and payment terms of contracts;

• Contract negotiations on change orders and collection of related accounts receivable;

• The timing of expenses incurred for corporate initiatives;

• Competition;

• Litigation;

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• Changes in accounting rules;

• The credit markets and their effect on our customers;

• General economic or political conditions; and

• Employee expenses such as medical and other benefits.

We experience seasonal trends in our business. Our revenue is typically lower in the second and third fiscal quarters, as our business is, to some extent, dependent on field work and construction scheduling and is also affected by holidays. Our revenue is lower during these times of the year because many of our clients' employees, as well as our own employees, do not work during those holidays, resulting in fewer billable hours charged to projects and thus, lower revenue recognized. In addition to holidays, harsher weather conditions that occur in the fall and winter can cause some of our offices to close and can significantly affect our project field work. Conversely, our business generally benefits from milder weather conditions in our first and fourth fiscal quarters which allow for more productivity from our field employees.

Acquisitions

We continuously evaluate the marketplace for strategic acquisition opportunities. A fundamental component of our profitable growth strategy is to pursue acquisitions that will expand our platform in key markets. Where the impact of acquisitions is noted in discussing results, it refers to acquisitions effected within the twelve months prior to the end of the relevant period.

On November 30, 2015, we acquired the Professional Services business ("Oil and Gas") of Willbros Group ("Willbros") in an all cash transaction. The initial purchase price consisted of (i) an initial cash payment of $120.0 million payable at closing, and, (ii) a second cash payment of $7.5 million payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016, net of an estimated working capital adjustment due from Willbros of $3.0 million. The second cash payment was made in two tranches, with $2.4 million million paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement. Goodwill of $60.3 million was initially recorded prior to impairment, all of which is expected to be tax deductible, and other intangible assets of $44.5 million were recorded as a result of this acquisition. The goodwill recognized is attributable to the future strategic growth opportunities arising from the acquisition, Oil and Gas's highly skilled assembled workforce, which does not qualify for separate recognition, and the expected cost synergies of the combined operations.

Operating Segments

We manage our business under the following four operating segments. To more clearly communicate our capabilities and focus to the marketplace, beginning in fiscal 2017, we have renamed our Energy segment “Power” and our Pipeline Services segment “Oil and Gas.”

Power (formerly Energy): The Power operating segment provides services to a range of clients including energy companies, power utilities, other commercial entities, and state and federal government entities. Our services include program management, engineer/procure/construct projects, design, and consulting. Our typical projects involve upgrades, design and new construction for electric transmission and distribution systems and substations; energy efficiency program design and management; and renewable energy development and power generation.

Environmental:  The Environmental operating segment provides services to a wide range of clients including industrial, transportation, energy and natural resource companies, as well as federal, state and municipal agencies. The Environmental operating segment is organized to focus on key areas of demand including: environmental management of buildings and facilities; air quality measurements and modeling of potential air pollution impacts; water quality and water resource management; assessment and remediation of contaminated sites and buildings; hazardous waste management; construction monitoring, inspection and management; environmental, health and safety management and sustainability advisory services; compliance

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auditing and strategic due diligence; environmental licensing and permitting of a wide variety of projects; and natural and cultural resource assessment, protection and management.

Infrastructure:  The Infrastructure operating segment provides services related to the expansion of infrastructure capacity and the rehabilitation of overburdened and deteriorating infrastructure systems. Our client base is predominantly state and municipal governments as well as select commercial developers. In addition, we provide infrastructure services on projects originating in our Power and Environmental operating segments. Primary services include: roadway, bridge and related surface transportation design; structural design and inspection of bridges; program management; construction engineering inspection and construction management for roads and bridges; civil engineering for municipalities and public works departments; geotechnical engineering services; and security assessments, design and construction management.

Oil & Gas (formerly Pipeline Services): The Oil & Gas operating segment provides pipeline and facilities engineering; engineer, procure, and construct ("EPC") services; engineer, procure, construct and management ("EPCm") services; field services and integrity services to the oil and gas transmission and midstream markets, as well as at government facilities. We specialize in providing engineering services to assist clients in designing, engineering and constructing or expanding pipeline systems, compressor stations, pump stations, fuel storage facilities, terminals, and field gathering and production facilities. Our expertise extends to the engineering of a wide range of project peripherals, including various types of support buildings and utility systems, power generation and electrical transmission systems, communications systems, fire protection, water and sewage treatment, water transmission, roads and railroad sidings. We also provide project management, engineering and material procurement services to the refining industry and government agencies, including mechanical, civil, structural, electrical instrumentation/controls and environmental engineering. We provide full-service integrity management program offerings including program development, data services, risk analysis, corrosion evaluation, integrity engineering and integrity construction services. We are partnered with Google to provide a cloud-based pipeline life-cycle integrity management solution, Integra Link™, which utilizes Google’s geospatial technology platform to help oil and gas pipeline companies visualize and utilize their data and information.

Our chief operating decision maker is our Chief Executive Officer ("CEO"). Our CEO manages the business by evaluating the financial results of the four operating segments, focusing primarily on segment revenue and segment profit. We utilize segment revenue and segment profit because we believe they provide useful information for effectively allocating resources among operating segments; evaluating the health of our operating segments based on metrics that management can actively influence; and gauging our investments and our ability to service, incur or pay down debt. Specifically, our CEO evaluates segment revenue and segment profit and assesses the performance of each operating segment based on these measures, as well as, among other things, the prospects of each of the operating segments and how they fit into our overall strategy. Our CEO then decides how resources should be allocated among our operating segments. We do not track our assets by operating segment, and consequently, it is not practical to show assets by operating segment. Segment profit includes all operating expenses except the following: costs associated with providing corporate shared services (including certain depreciation and amortization), goodwill and intangible asset write-offs, and stock-based compensation expense. Depreciation expense is primarily allocated to operating segments based upon their respective use of total operating segment office space. Assets solely used at the Corporate level are not allocated to the operating segments. Inter-segment balances and transactions are not material. The accounting policies of the operating segments are the same as those for us as a whole except as discussed herein.

On July 1, 2016 we made certain changes to our management reporting structure which resulted in a change to the composition of the Infrastructure operating segment. Certain corporate employees were transferred to the Infrastructure operating segment. As a result, beginning in fiscal year 2017 we report our financial performance based on the current reporting structure. We have recast certain prior period amounts to conform to the way we internally manage and monitor segment performance. These changes had no impact on consolidated net income or cash flows and were not material to the segment measurements presented.

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The following table presents the approximate percentage of our NSR by operating segment for the three months ended September 30, 2016 and September 25, 2015:

	Three Months Ended
	September 30, 2016		September 25, 2015
Power	30	%	34	%
Environmental	40	%	52	%
Infrastructure	13	%	14	%
Oil and Gas	17	%	—	%
	100	%	100	%

Business Trend Analysis

Power: The utilities in the United States are in the midst of a multi-year upgrade of the electric transmission grid to improve capacity, reliability and distribution of sources of generation. Years of underinvestment coupled with a favorable regulatory environment have provided a good business opportunity for those serving this market. According to the Edison Electric Institute, electric utilities throughout the United States will be investing over $60 billion in the performance of this work over the next several years. Economic impacts have slowed the pace of this investment, yet they do not appear to have affected the long term plan of investment. Demand for energy efficiency services continues to be supported by increasing state and federal funds targeted at energy efficiency. The Regional Green House Gas Initiative and system benefit charges at the state or utility level have expanded the marketplace for energy efficiency program management services. Investment within the renewable portfolios also remains strong. We are well established in the Northeast and Mid-Atlantic regions and are growing our presence in the Southeast and in Texas and California where demand for services is the highest.

Environmental: Following a slowdown caused by general economic conditions, market demand for environmental services continues to be mixed. The fundamental market drivers remain in place, and this market also benefits from evolving regulatory developments particularly with respect to air quality, and the continuing need to enhance our aging transportation and energy infrastructure. While we expect oil and gas activity and major capital projects to be constrained in the near term, the outlook for services related to other areas of the market, such as environmental remediation, construction, transaction support, the retirement of coal plants and the need to transport natural gas remains favorable. Renewables and other energy source initiatives present important market opportunities but are linked to federal and state policy changes which will be required for the markets to commit long-term capital to projects.

Infrastructure: Long-term prospects should be favorable and our backlog has increased significantly. The overall infrastructure construction markets are expected to benefit from the federal funding certainty provided by the new $305 billion highway bill known as the Fixing America’s Surface Transportation (FAST) Act. The bill calls for the spending of approximately $205 billion on highways and $48 billion on transit projects.

Oil & Gas:Our Oil & Gas segment is currently in the midst of a market downturn due to low oil and gas prices and uncertainty in the oil and gas markets. Nevertheless, long-term opportunities include mid-stream oil and natural gas liquid pipelines which are necessary to match takeaway capacity with levels of production, some of which is stranded due to inadequate pipeline infrastructure, primarily in the Marcellus and Utica shales. Additional future opportunities are presented by natural gas pipelines to take gas to LNG export facilities as well as Mexico and Latin America. Furthermore natural gas pipelines will be required as coal plants are retired and replaced with cleaner gas-burning plants. New regulatory requirements proposed by the Department of Transportation will lead to data and integrity requirements for pipeline operators where our technologies and services can be utilized.

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Critical Accounting Policies

Our condensed consolidated financial statements have been prepared in accordance with U.S. GAAP. These principles require the use of estimates and assumptions that affect amounts reported and disclosed in the condensed consolidated financial statements and related notes. Actual results could differ from these estimates and assumptions. We use our best judgment in the assumptions used to compile these estimates which are based on current facts and circumstances, prior experience and other assumptions that are believed to be reasonable. Further detail regarding our critical accounting policies can be found in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2016, as filed with the Securities Exchange Commission ("SEC") on August 31, 2016. No material changes concerning our critical accounting policies have occurred since June 30, 2016.

Results of Operations

Consolidated Results of Operations

The following table presents the dollar and percentage changes in the condensed consolidated statements of operations for the three months ended September 30, 2016 and September 25, 2015:

	Three Months Ended
	September 30,			September 25,			Change
(Dollars in thousands)	2016			2015			$			%
Gross revenue	$	180,851		$	135,459		$	45,392		33.5	%
Less subcontractor costs and other direct reimbursable charges	56,546			35,296			21,250			60.2
Net service revenue	124,305			100,163			24,142			24.1
Interest income from contractual arrangements	34			15			19			126.7
Insurance recoverables and other income	637			742			(105		)	(14.2	)
Cost of services (exclusive of costs shown separately below)	103,676			82,984			20,692			24.9
General and administrative expenses	10,839			7,121			3,718			52.2
Acquisition and integration expenses	—			878			(878		)	(100.0	)
Depreciation	1,788			1,424			364			25.6
Amortization	2,716			840			1,876			223.3
Operating income	5,957			7,673			(1,716		)	(22.4	)
Interest income	278			—			278			100.0
Interest expense	(845		)	(28		)	(817		)	2,917.9
Income from operations before taxes	5,390			7,645			(2,255		)	(29.5	)
Income tax provision	(1,731		)	(3,157		)	1,426			(45.2	)
Net income	3,659			4,488			(829		)	(18.5	)
Net (income) loss applicable to noncontrolling interest	(20		)	4			(24		)	(600.0	)
Net income applicable to TRC Companies, Inc.	$	3,639		$	4,492		$	(853	)	(19.0	)%

Three Months EndedSeptember 30, 2016

Gross revenue increased $45.4 million, or 33.5%, to $180.9 million for the three months ended September 30, 2016 from $135.5 million for the same period in the prior year. Organic activities accounted for $18.8 million, or 41.3%, of the growth in gross revenue, and acquisitions accounted for the remaining $26.6 million, or 58.7%, of the increase. The increase in organic gross revenue was primarily attributable to our Power operating segment where gross revenue increased $17.8 million driven by several large capital projects that had significant subcontractor and procurement activities which generated higher levels of gross revenue and other direct charges ("ODC's") in the current period.

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NSR increased $24.1 million, or 24.1%, to $124.3 million for the three months ended September 30, 2016 from $100.2 million for the same period in the prior year. Organic activities accounted for $2.8 million, or 11.6%, of the increase in NSR, and acquisitions accounted for $21.3 million, or 88.4%, of the increase. The increase in organic NSR was, in part, due to our Power operating segment where NSR increased $2.8 million driven by the aforementioned large capital projects. In our Infrastructure operating segment, several large transportation projects, and, to a lesser extent, increased demand from our state government clients, contributed $3.1 million of organic NSR growth for the period. The organic NSR growth in our Power and Infrastructure operating segments was partially offset by a $2.7 million decline in the Environmental operating segment. This decline was due to the continued slowdown from certain oil and gas clients and the wind-down of a large remediation project.

Insurance recoverables and other income decreased $0.1 million, or 14.2%, to $0.6 million for the three months ended September 30, 2016 from $0.7 million for the same period in the prior year.

COS increased $20.7 million, or 24.9%, to $103.7 million for the three months ended September 30, 2016 from $83.0 million for the same period in the prior year. Organic activities increased $3.1 million, or 15.2%, and acquisitions accounted for $17.6 million, or 84.8%, of the increase. Fringe benefit costs contributed to the increase in organic COS, and, in particular, health insurance costs increased $1.5 million in the current quarter as compared to the same period in the prior year. The Company is self-insured for the first $150 thousand of health claims per employee each year. Consequently, employee health insurance costs can vary significantly from period to period, and in the current quarter we experienced a higher level of costs. The balance of the increase in organic COS was attributable to costs incurred to support the current demand from our Infrastructure and Power operating segment clients. As a percentage of NSR, COS were 83.4% and 82.8% for the three months ended September 30, 2016 and September 25, 2015, respectively.

G&A expenses increased $3.7 million, or 52.2%, to $10.8 million for the three months ended September 30, 2016 from $7.1 million for the same period in the prior year. Organic activities increased $2.9 million, or 78.4%, and acquisitions accounted for $0.8 million, or 21.6%, of the increase. The organic increase was primarily due to a $1.2 million and $0.4 million current quarter increase in legal costs and professional fees, respectively, which can vary in amount and timing year to year. The remainder of the increase was due to additional costs incurred to support certain organic growth initiatives. As a percentage of NSR, G&A expenses were 8.7% and 7.1% for the three months ended September 30, 2016 and September 25, 2015, respectively.

Depreciation expenses increased $0.4 million, or 25.6%, to $1.8 million for the three months ended September 30, 2016 from $1.4 million for the same period in the prior year. The increase was primarily attributable to the Oil and Gas assets acquired in November 2015, which contributed $0.4 million of depreciation expense in the three months ended September 30, 2016.

Amortization expenses increased $1.9 million, or 223.3%, to $2.7 million for the three months ended September 30, 2016 from $0.8 million for the same period in the prior year. The increase was primarily attributable to the Oil and Gas intangible assets acquired in November 2015, which contributed $2.1 million of amortization expense in the three months ended September 30, 2016.

Our effective tax rate was approximately 32.1% and 41.3% for the three months ended September 30, 2016 and September 25, 2015 respectively. The primary reconciling items between the federal statutory rate of 35.0% and our overall effective tax rate for the three months ended September 30, 2016 were the effect of state income taxes offset by tax benefits related to the U.S. Research and Development credit, U.S. Domestic Production Activities deduction and the effective settlement of uncertain tax positions. The primary reconciling items between the federal statutory rate of 35.0% and our overall effective tax rate for the three months ended September 25, 2015 were the effect of state income taxes.

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Costs and Expenses as a Percentage of NSR

The following table presents the percentage relationships of items in the condensed consolidated statements of operations to NSR for the three months ended September 30, 2016 and September 25, 2015:    

	Three Months Ended
	September 30, 2016		September 25, 2015
Net service revenue	100.0	%	100.0	%
Interest income from contractual arrangements	—		—
Insurance recoverables and other income	0.5		0.7
Operating costs and expenses:
Cost of services (exclusive of costs shown separately below)	83.4		82.8
General and administrative expenses	8.7		7.1
Acquisition and integration expenses	—		0.9
Depreciation	1.4		1.4
Amortization	2.2		0.8
Total operating costs and expenses	95.7		93.1
Operating income	4.8		7.7
Interest income	0.2		—
Interest expense	(0.7	)	—
Income from operations before taxes	4.3		7.6
Income tax provision	(1.4	)	(3.2	)
Net income	2.9	%	4.5	%

Additional Information by Reportable Operating Segment

Power Operating Segment Results

	Three Months Ended
	September 30,		September 25,		Change
(Dollars in thousands)	2016		2015		$		%
Gross revenue	$	56,995	$	39,237	$	17,758	45.3	%
Net service revenue	$	37,100	$	34,338	$	2,762	8.0	%
Segment profit	$	7,967	$	7,312	$	655	9.0	%

Gross revenue increased $17.8 million, or 45.3%, for the three months ended September 30, 2016, compared to the same period in the prior year. This increase was primarily driven by several large capital projects, in particular, a large EPC project and a significant program management project in California. These projects, which have recently entered the construction phase, had significant subcontractor and procurement activities that generated higher levels of gross revenue and ODC's in the current period.

NSR increased $2.8 million, or 8.0%, for the three months ended September 30, 2016, compared to the same period in the prior year. The increase in NSR was due, in part, to the aforementioned capital projects, and, in particular, increased labor revenue from our design and program management services. NSR also benefitted from three additional business days in the current quarter, which added approximately $1.7 million of NSR.

The Power operating segment's profit increased $0.7 million, or 9.0%, for the three months ended September 30, 2016, compared to the same period in the prior year. The increase in segment profit was primarily due to the same factors that

33

led to the increase in NSR. As a percentage of NSR, the Power operating segment's profit increased to 21.5% from 21.3% for the three months ended September 30, 2016, compared to the same period in the prior year.

Environmental Operating Segment Results

	Three Months Ended
	September 30,		September 25,		Change
(Dollars in thousands)	2016		2015		$			%
Gross revenue	$	73,936	$	75,843	$	(1,907	)	(2.5	)%
Net service revenue	$	48,894	$	51,564	$	(2,670	)	(5.2	)%
Segment profit	$	9,052	$	9,982	$	(930	)	(9.3	)%

Gross revenue decreased $1.9 million, or 2.5%, for the three months ended September 30, 2016, compared to the same period in the prior year. The decrease in the first quarter of fiscal 2017 was primarily due to a decline in services provided to our oil and gas clients. In particular, the low prevailing oil and gas prices and uncertain market conditions led to continued capital spending constraints for midstream capital projects.

NSR decreased $2.7 million, or 5.2%, for the three months ended September 30, 2016, compared to the same period in the prior year. The decrease in NSR was primarily attributable to the same factors that led to lower gross revenue as well as the wind-down of a large remediation project that provided significant NSR in the same period of the prior year. The decrease in NSR was partially mitigated by three additional business days in the current quarter, which added approximately $2.2 million of NSR.

The Environmental operating segment's profit decreased $0.9 million, or 9.3%, for the three months ended September 30, 2016, compared to the same period in the prior year. The decrease in segment profit was directly related to lower volume of revenue from our oil and gas clients coupled with inefficiencies associated with transitioning to smaller, highly competitive midstream projects, including lower utilization of employee labor. As a percentage of NSR, the Environmental operating segment's profit decreased to 18.5% from 19.4% for the three months ended September 30, 2016, compared to the same period in the prior year.

Infrastructure Operating Segment Results

	Three Months Ended
	September 30,		September 25,		Change
(Dollars in thousands)	2016		2015		$		%
Gross revenue	$	22,913	$	19,970	$	2,943	14.7	%
Net service revenue	$	16,630	$	13,562	$	3,068	22.6	%
Segment profit	$	4,309	$	2,893	$	1,416	48.9	%

Gross revenue increased $2.9 million, or 14.7%, for the three months ended September 30, 2016, compared to the same period in the prior year. These results reflect increased state and local government activity associated with the upgrade of existing infrastructure.

NSR increased $3.1 million, or 22.6%, for the three months ended September 30, 2016, compared to the same period in the prior year. The increase in NSR was largely attributable to the same factors that led to the increases in gross revenue as well as the benefit of three additional business days in the current quarter compared to the same period of the prior year, which added approximately $0.8 million of NSR.

34

The Infrastructure operating segment's profit increased $1.4 million, or 48.9%, for the three months ended September 30, 2016, compared to the same period in the prior year. The increase in segment profit was primarily attributable to the same factors that led to the increase in NSR, as well as emphasis on project execution and the benefit of increased scale in the business. As a percentage of NSR, the Infrastructure operating segment's profit increased to 25.9% from 21.3% for the three months ended September 30, 2016, compared to the same period in the prior year.

Oil & Gas Operating Segment Results

	Three Months Ended
(Dollars in thousands)	September 30, 2016
Gross revenue	$	26,638
Net service revenue	$	21,338
Segment profit	$	1,371

Oil & Gas contributed $26.6 million in gross revenue, $21.3 million in NSR, and had segment profit of $1.4 million for the three months ended September 30, 2016. Continued uncertainty surrounding the oil and gas markets, including depressed commodity prices impacted current period operating results. These operating results were also impacted by non-cash purchase accounting adjustments of approximately $2.1 million, primarily amortization expense. Against the backdrop of these difficult and uncertain markets, the Oil and Gas operating segment improved sequential operating results. In particular as a percentage of NSR, operating segment profit margin increased to 6.4% in the current quarter compared to a loss in the prior two sequential quarters. The improved segment profit is primarily related to cost reduction initiatives taken over the last several quarters, including, but not limited to, staff reductions, reduction of indirect costs and rationalization of office space.

Backlog by Operating Segment

As of September 30, 2016, our contract backlog based on gross revenue was $613 million, compared to $526 million as of September 25, 2015. Our contract backlog based on NSR was $352 million as of September 30, 2016, compared to $319 million as of September 25, 2015. Typically about 60% of backlog is completed in one year. In addition to this contract backlog, we hold open-order contracts from various commercial clients and government agencies. As work under these contracts is authorized and funded, we include this portion in our contract backlog. While most contracts contain cancellation provisions, we are unaware of any material work included in backlog that will be canceled or delayed.

The following table sets forth the gross revenue and NSR contract backlog amounts of our operating segments at September 30, 2016 and September 25, 2015 (in millions):

	Gross Revenue Backlog									NSR Backlog
	September 30,		September 25,		Change					September 30,		September 25,		Change
(Dollars in millions)	2016		2015		$			%		2016		2015		$			%
Power	$	191	$	168	$	23		13.7	%	$	96	$	98	$	(2	)	(2.0	)%
Environmental	251		233		18			7.7	%	133		130		3			2.3	%
Infrastructure	124		125		(1		)	(0.8	)%	88		91		(3		)	(3.3	)%
Oil & Gas	47		—		47			N/A		35		—		35			N/A
Total	$	613	$	526	$	87		16.5	%	$	352	$	319	$	33		10.3	%

35

Revisions in Estimates

We have numerous contracts in progress at any time, all of which are at various stages of completion. Our recognition of profit is dependent upon the accuracy of a variety of estimates including engineering progress, materials quantities, achievement of milestones and other incentives, liquidated-damages provisions, labor productivity and cost estimates. Such estimates are based on various judgments we make with respect to those factors and can be difficult to accurately determine until the project is significantly underway. Due to uncertainties inherent in the estimation process, actual completion costs often vary from estimates. If estimated total costs on any contract indicate a loss, we charge the entire estimated loss to operations in the period the loss first becomes known. If actual costs exceed the original fixed contract price, recognition of any additional revenue will be pursuant to a change order, contract modification, or claim.

The following table summarizes the number of projects that experienced estimated contract profit revisions relating to the revaluation of work performed in prior periods:

		Three Months Ended
		September 30,			September 25,
(Dollars in thousands)		2016			2015
Number of projects		1,328			1,213
Net increase (reduction) in project profitability		$	(1,402	)	$	(383	)
Net increase (reduction) in project profitability by operating segment:
Power		$	(863	)	$	386
Environmental		(917		)	(174		)
Infrastructure		254			(595		)
Oil and Gas		124			—
	Total	$	(1,402	)	$	(383	)

Impact of Inflation

Our operations have not been materially affected by inflation or changing prices because most contracts of a longer term are subject to adjustment or have been priced to cover anticipated increases in labor and other costs, and the remaining contracts are short term in nature.

Liquidity and Capital Resources

We primarily rely on cash from operations and financing activities, including borrowings under our revolving credit facility, to fund our operations. Our liquidity is assessed in terms of our overall ability to generate cash to fund our operating and investing activities and to service debt. We believe that our available cash, cash flows from operations and borrowing capacity under our credit facility, discussed under "Revolving Credit Facility and Term Loan" below, will be sufficient to fund our operations for at least the next twelve months.

36

The following table provides summarized information with respect to our cash balances and cash flows as of and for the three months ended September 30, 2016 and September 25, 2015 (in thousands):

	Three Months Ended
	September 30,			September 25,			Change
(Dollars in thousands)	2016			2015			$			%
Net cash (used in) provided by operating activities	$	(3,186	)	$	14,388		$	(17,574	)	(122.1	)%
Net cash used in investing activities	(990		)	(1,962		)	972			49.5	%
Net cash (used in) provided by financing activities	(1,947		)	3,427			(5,374		)	156.8	%

As of September 30, 2016, cash and cash equivalents decreased by $6.1 million, or 32.6%, to $12.7 million, compared to the fiscal year ended June 30, 2016. This decline is primarily the result of cash utilized for the final payment of the acquisition of Oil and Gas from Willbros on November 30, 2015, as well as other debt payment activity.

Net cash used in operating activities decreased by $17.6 million, or 122.1%, to $3.2 million for the three months ended September 30, 2016, compared to $14.4 million of cash provided for the same period of the prior year. The decrease was primarily attributable to the timing of collections activity with respect to accounts receivable in the three months ended September 30, 2016 compared to the same period of the prior year.

Accounts receivable include both: (1) billed receivables associated with invoices submitted for work performed and (2) unbilled receivables (work in progress). The unbilled receivables are primarily related to work performed in the last month of the quarter. The efficiency of the billing and collection process is commonly evaluated as day's sales outstanding ("DSO"), which we calculate by dividing accounts receivable by the most recent three-month average of daily gross revenue. Current quarter DSO, which measures the collections turnover of both billed and unbilled receivables, increased to 84 days as of September 30, 2016 from 79 days as of June 30, 2016, and decreased from 90 days when compared to September 25, 2015. Our goal is to maintain DSO at less than 82 days.

Net cash used in investing activities decreased by $1.0 million, or 49.5%, to $1.0 million for the three months ended September 30, 2016, compared to $2.0 million of cash used for the same period of the prior year. The decrease was primarily attributable to $0.4 million less utilized for property and equipment.

Net cash used by financing activities increased by $5.4 million, or 156.8%, to $1.9 million for the three months ended September 30, 2016, compared to $3.4 million of cash provided in the same period of the prior year. The increase was directly attributable debt service payments on our Term Loan as well as the final payment made for the acquisition of Oil and Gas in the current year period.

Long-Term Debt

Revolving Credit Facility and Term Loan

See a discussion of our credit facility (the "Credit Agreement"), other notes payable and capital lease obligations in Note 9 - Long-Term Debt and Capital Lease Obligations, under Part I, Item 1, Notes to Condensed Consolidated Financial Statements.

The actual results as compared to the covenant requirements under the Credit Agreement as of September 30, 2016

for the measurement periods described below are as follows (in thousands):

Financial Covenant	Measurement Period	Actual	Required
Maximum leverage ratio	Trailing 12 Months	1.41	Not to exceed	3.00 to 1.00
Minimum fixed charge coverage ratio	Trailing 12 Months	3.70	Must exceed	1.25 to 1.00

37

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We do not currently utilize derivative financial instruments. We are exposed to interest rate risk under our Credit Agreement. Amounts outstanding under the Credit Agreement bear interest at the Base Rate (as defined, generally the prime rate) plus a margin of 0.50% to 1.25%, or at the Eurodollar Rate (as defined, generally the Libor rate) plus a margin of 1.50% to 2.25%, based on the Company's Leverage Ratio (as defined).

Borrowings at these rates under the Revolving Facility have no designated term and may be repaid without penalty any time prior to the maturity date. Borrowings outstanding under the Revolving Facility will mature on November 30, 2020. The Term Loan amortizes in quarterly installments payable on the last day of each March, June, September, and December, commencing on March 31, 2016 in amounts equal to 1.875% of the term loan made or outstanding, with the balance payable on the November 30, 2020 Term Loan Maturity Date.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company has evaluated, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the effectiveness of its disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act, as of September 30, 2016. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures were effective as of September 30, 2016.

Changes in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act, during the Company's quarter ended September 30, 2016 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

38

PART II: OTHER INFORMATION

Item 1. Legal Proceedings

See Legal Matters in Note 13 - Commitments and Contingencies, under Part I, Item 1, Financial Information.

Item 1A. Risk Factors

No material changes.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.Defaults Upon Senior Securities

None.

Item 4.    Mine Safety Disclosures

Not Applicable.

Item 5.Other Information

None.

Item 6.Exhibits

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

39

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		TRC COMPANIES, INC.
November 3, 2016	By:	/s/ Thomas W. Bennet, Jr.
		Thomas W. Bennet, Jr.
		Senior Vice President and Chief Financial Officer
		(Duly Authorized Officer, Principal Financial Officer and Principal Accounting Officer)

40

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher P. Vincze, certify that:

1. I have reviewed this quarterly report on Form 10-Q of TRC Companies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	November 3, 2016
/s/ Christopher P. Vincze
Christopher P. Vincze
Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Thomas W. Bennet, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of TRC Companies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	November 3, 2016
/s/ Thomas W. Bennet, Jr.
Thomas W. Bennet, Jr.
Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of TRC Companies, Inc. (the "Company") on Form 10-Q for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Christopher P. Vincze, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 3, 2016
/s/ Christopher P. Vincze
Christopher P. Vincze
Chief Executive Officer

[A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to TRC Companies, Inc. and will be retained by TRC Companies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.]

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of TRC Companies, Inc. (the "Company") on Form 10-Q for the quarter ended September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Thomas W. Bennet, Jr., Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	November 3, 2016
/s/ Thomas W. Bennet, Jr.
Thomas W. Bennet, Jr.
Chief Financial Officer

[A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to TRC Companies, Inc. and will be retained by TRC Companies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.]

XML

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2016	Oct. 17, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	TRC COMPANIES INC /DE/
Entity Central Index Key	0000103096
Current Fiscal Year End Date	--06-30
Entity Filer Category	Accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		31,390,002

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Income Statement [Abstract]
Gross revenue	$ 180,851	$ 135,459
Less subcontractor costs and other direct reimbursable charges	56,546	35,296
Net service revenue	124,305	100,163
Interest income from contractual arrangements	34	15
Insurance recoverables and other income	637	742
Operating costs and expenses:
Cost of services (exclusive of costs shown separately below)	103,676	82,984
General and administrative expenses	10,839	7,121
Acquisition and integration expenses	0	878
Depreciation	1,788	1,424
Amortization	2,716	840
Total operating costs and expenses	119,019	93,247
Operating income	5,957	7,673
Interest income	278	0
Interest expense	(845)	(28)
Income from operations before taxes	5,390	7,645
Income tax provision	(1,731)	(3,157)
Net income	3,659	4,488
Net (income) loss applicable to noncontrolling interest	(20)	4
Net income applicable to TRC Companies, Inc.	$ 3,639	$ 4,492
Basic earnings per common share (in dollars per share)	$ 0.12	$ 0.15
Diluted earnings per common share (in dollars per share)	$ 0.12	$ 0.14
Weighted-average common shares outstanding:
Basic (shares)	31,149	30,635
Diluted (shares)	31,601	31,318

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Net income	$ 3,659	$ 4,488
Other comprehensive (loss) income
Unrealized (loss) gain on available-for-sale securities	(44)	(12)
Tax effect on unrealized (loss) gain on available-for-sale securities	17	5
Reclassification for loss (gain) on available-for-sale securities included in net income	0	25
Tax effect on realized (gain) loss on available-for-sale securities	0	(10)
Total other comprehensive (loss) income	(27)	8
Comprehensive income	3,632	4,496
Comprehensive (income) loss attributable to noncontrolling interests	(20)	4
Comprehensive income attributable to TRC Companies, Inc.	$ 3,612	$ 4,500

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Current assets:
Cash and cash equivalents	$ 12,681	$ 18,804
Restricted cash	60	71
Accounts receivable, less allowance for doubtful accounts	168,466	149,280
Insurance recoverable - environmental remediation	50,086	49,934
Restricted investments	5,473	5,959
Income taxes refundable	0	75
Prepaid expenses and other current assets	21,917	24,122
Total current assets	258,683	248,245
Property and equipment	75,193	74,053
Less accumulated depreciation and amortization	(52,922)	(51,593)
Property and equipment, net	22,271	22,460
Goodwill	75,337	75,337
Intangible assets, net	43,253	45,969
Deferred income tax assets	25,851	26,239
Long-term restricted investments	18,150	18,420
Long-term prepaid insurance	22,896	23,425
Other assets	16,575	18,383
Total assets	483,016	478,478
Current liabilities:
Current portion of long-term debt	15,497	18,339
Accounts payable	39,210	29,311
Accrued compensation and benefits	47,733	48,485
Deferred revenue	13,880	15,363
Environmental remediation liabilities	8,646	8,654
Income taxes payable	902	265
Other accrued liabilities	57,541	58,026
Total current liabilities	183,409	178,443
Non-current liabilities:
Long-term debt, net of current portion	77,253	79,243
Long-term income taxes payable	903	2,204
Deferred revenue	63,933	65,340
Environmental remediation liabilities	408	433
Total liabilities	325,906	325,663
Commitments and contingencies
Equity:
Common stock, $.10 par value; 40,000,000 shares authorized, 31,258,090 and 31,254,608 shares issued and outstanding, respectively, at September 30, 2016, and 31,087,084 and 31,083,602 shares issued and outstanding, respectively, at June 30, 2016	3,126	3,109
Additional paid-in capital	195,802	195,156
Accumulated deficit	(42,259)	(45,898)
Accumulated other comprehensive loss	(98)	(71)
Treasury stock, at cost	(33)	(33)
Total stockholders' equity applicable to TRC Companies, Inc.	156,538	152,263
Noncontrolling interest	572	552
Total equity	157,110	152,815
Total liabilities and equity	$ 483,016	$ 478,478

XML

CONDENSED CONSOLIDATED BALANCE SHEETS Parenthetical - $ / shares	Sep. 30, 2016	Jun. 30, 2016
Stockholders' Equity:
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	31,258,090	31,087,084
Common stock, shares outstanding	31,254,608	31,083,602

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Cash flows from operating activities:
Net income	$ 3,659	$ 4,488
Non-cash items:
Depreciation and amortization	4,504	2,264
Amortization of debt issuance costs	180	0
Stock-based compensation expense	1,457	1,269
Provision for doubtful accounts	616	0
Deferred income taxes	380	(181)
Other non-cash items	(342)	594
Changes in operating assets and liabilities:
Accounts receivable	(19,660)	3,205
Insurance recoverable - environmental remediation	(152)	8
Income taxes	(589)	(1,514)
Restricted investments	224	252
Prepaid expenses and other current assets	(1,158)	(3,852)
Long-term prepaid insurance	529	563
Other assets	1,705	168
Accounts payable	9,884	(444)
Accrued compensation and benefits	(1,560)	7,909
Deferred revenue	(2,890)	334
Environmental remediation liabilities	(33)	(22)
Other accrued liabilities	60	(653)
Net cash (used in) provided by operating activities	(3,186)	14,388
Cash flows from investing activities:
Additions to property and equipment	(1,625)	(2,039)
Withdrawals from restricted investments	512	66
Proceeds from sale of fixed assets	123	11
Net cash used in investing activities	(990)	(1,962)
Cash flows from financing activities:
Payments on long-term debt and other	8,363	1,016
Payments on capital lease obligations	0	(74)
Proceeds from long-term debt and other	4,865	5,632
Repayments of term loan debt	(1,406)	0
Net working capital and additional cash payments on acquisitions	(2,957)	359
Shares repurchased to settle tax withholding obligations	0	(1,527)
Excess tax benefit from stock-based awards	0	740
Proceeds from exercise of stock options	0	31
Net cash (used in) provided by financing activities	(1,947)	3,427
(Decrease) increase in cash and cash equivalents	(6,123)	15,853
Cash and cash equivalents, beginning of period	18,804	37,296
Cash and cash equivalents, end of period	$ 12,681	$ 53,149

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Total	Parent [Member]	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Treasury Stock	Noncontrolling Interest
Shares issued, beginning of period at Jun. 30, 2015			30,486,000				3,000
Beginning Balance at Jun. 30, 2015	$ 147,915	$ 148,310	$ 3,049	$ 191,321	$ (45,939)	$ (88)	$ (33)	$ 395
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	4,488	4,492			4,492			(4)
Other comprehensive income	8	8				8
Exercise of stock options (in shares)			11,000
Exercise of stock options	31	31	$ 1	30
Stock-based compensation (in shares)			526,000
Stock-based compensation	1,269	1,269	$ 52	1,217
Shares repurchased to settle tax withholding obligations (in shares)			(189,000)
Shares repurchased to settle tax withholding obligations	(1,797)	(1,797)	$ (19)	(1,778)
Directors' deferred compensation (in shares)			1,000
Directors' deferred compensation	12	12	$ 0	12
Excess tax benefit from stock-based awards	734	734		734
Shares issued, end of period at Sep. 25, 2015			30,835,000				3,000
Ending Balance at Sep. 25, 2015	152,660	153,059	$ 3,083	191,536	(41,447)	(80)	$ (33)	399
Shares issued, beginning of period at Jun. 30, 2016			31,087,000				3,000
Beginning Balance at Jun. 30, 2016	152,815	152,263	$ 3,109	195,156	(45,898)	(71)	$ (33)	(552)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	3,659	3,639			3,639			20
Other comprehensive income	(27)	(27)				(27)
Stock-based compensation (in shares)			275,000
Stock-based compensation	1,457	1,457	$ 28	1,429
Shares repurchased to settle tax withholding obligations (in shares)			(108,000)
Shares repurchased to settle tax withholding obligations	(819)	(819)	$ (11)	(808)
Directors' deferred compensation (in shares)			4,000
Directors' deferred compensation	25	25	$ 0	25
Shares issued, end of period at Sep. 30, 2016			31,258,000				3,000
Ending Balance at Sep. 30, 2016	$ 157,110	$ 156,538	$ 3,126	$ 195,802	$ (42,259)	$ (98)	$ (33)	$ (572)

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Company Background and Basis of Presentation

3 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Company Background and Basis of Presentation

Company Background and Basis of Presentation

TRC Companies, Inc., through its subsidiaries (collectively, the "Company"), provides integrated engineering, consulting, and construction management services. Its project teams help its commercial and governmental clients implement environmental, power, infrastructure and oil and gas related projects from initial concept to delivery and operation. The Company provides its services almost entirely in the United States of America.

The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been omitted pursuant to those rules and regulations, but the Company's management believes that the disclosures included herein are adequate to make the information presented not misleading. The condensed consolidated financial statements include the accounts of the Company and all of its subsidiaries in which a controlling interest is maintained. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2016.

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New Accounting Pronouncements

3 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

New Accounting Pronouncements

New Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board ("FASB") issued an accounting standards update which simplifies employee share-based payment accounting. This standard simplifies the income tax consequences, accounting for forfeitures and classification on the statement of cash flows. The standard requires that, prospectively, all tax effects related to share-based payments be made through the income statement at the time of settlement as opposed to excess tax benefits being recognized in additional paid-in-capital under the current guidance. The standard also removes the requirement to delay recognition of a tax benefit until it reduces current taxes payable. This change is required to be applied on a modified retrospective basis, with a cumulative-effect adjustment to opening retained earnings. Additionally, all tax related cash flows resulting from share-based payments are to be reported as operating activities on the statement of cash flows, a change from the current requirement to present tax benefits as an inflow from financing activities and an outflow from operating activities. Finally, entities will be allowed to withhold an amount up to the employees’ maximum individual tax rate (as opposed to the minimum statutory tax rate) in the relevant jurisdiction without resulting in liability classification of the award. The change in withholding requirements will be applied on a modified retrospective approach. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company adopted this standard effective for its first quarter of fiscal 2017. The impact of the early adoption resulted in the following:

• The Company recorded a tax deficiency of $6 within income tax expense for the three months ended September 30, 2016 related to the tax shortfall on share based awards. Prior to adoption this amount would have been recorded as a decrease of capital in excess of par value. This change could create volatility in the Company's effective tax rate.

• The Company no longer reflects the cash received from the excess tax benefit within cash flows from financing activities but instead now reflects this benefit within cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows. The Company elected to apply this change in presentation prospectively and thus prior periods have not been adjusted.

• The Company elected not to change its policy on accounting for forfeitures and continues to estimate the total number of awards for which the requisite service period will not be rendered.

• The Company’s statutory withholding requirements have been updated to allow withholding up to the Company's maximum statutory withholding requirements in relevant jurisdictions.

• The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of our diluted earnings per share for the three months ended September 30, 2016. This increased diluted weighted average common shares outstanding by less than 24 shares for the period.

In February 2016, the FASB issued an accounting standards update which will replace most existing lease accounting guidance. This standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. This standard will be effective for the Company's fiscal year beginning July 1, 2019. Early adoption is permitted and should be applied using a modified retrospective approach.   The Company is in the process of evaluating the potential impacts of this standard on its condensed consolidated financial statements and related disclosures, including potential early adoption.

In May 2014, the FASB issued an accounting standards update that replaces existing revenue recognition guidance. The updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In March 2016, the FASB further clarified the implementation guidance on principal versus agent considerations. The new standard will be effective for the Company's fiscal year beginning July 1, 2018. Early adoption is permitted under this standard for annual periods beginning after December 15, 2016, and it is to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company has not yet selected a transition method and is currently evaluating the effect the standard will have on its condensed consolidated financial statements.

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Fair Value Measurements

3 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company's financial assets or liabilities are measured using inputs from the three levels of the fair value hierarchy. The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The three levels are as follows:

Level 1 Inputs - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Generally, this includes debt and equity securities and derivative contracts that are traded on an active exchange market (e.g., the New York Stock Exchange) as well as certain U.S. Treasury and U.S. Government and agency mortgage-backed securities that are highly liquid and are actively traded in over-the-counter markets.

Level 2 Inputs - Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; or valuations based on models where the significant inputs are observable (e.g., interest rates, yield curves, credit risks) or can be corroborated by observable market data.

Level 3 Inputs - Valuations based on models where significant inputs are not observable. The unobservable inputs reflect the Company's own assumptions about the assumptions that market participants would use.

The following tables present the level within the fair value hierarchy at which the Company's financial assets and certain liabilities were measured on a recurring basis as of September 30, 2016 and June 30, 2016:

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	72	$	—	$	—	$	72
Certificates of deposit	—		106		—		106
Municipal bonds	—		543		—		543
Corporate bonds	—		344		—		344
U.S. Government bonds	—		218		—		218
U.S. Treasury Notes	1,995		—		—		1,995
Money market accounts and cash deposits	6,399		—		—		6,399
Total assets	$	8,466	$	1,211	$	—	$	9,677
Contingent consideration	$	—	$	—	$	90	$	90
Total liabilities	$	—	$	—	$	90	$	90

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of June 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	71	$	—	$	—	$	71
Certificates of deposit	—		107		—		107
Municipal bonds	—		547		—		547
Corporate bonds	—		439		—		439
U.S. Government bonds	—		219		—		219
U.S. Treasury Notes	2,009		—		—		2,009
Money market accounts and cash deposits	6,476		—		—		6,476
Total assets	$	8,556	$	1,312	$	—	$	9,868
Contingent consideration	$	—	$	—	$	233	$	233
Total liabilities	$	—	$	—	$	233	$	233

A majority of the Company's investments are priced by pricing vendors and are generally Level 1 or Level 2 investments, as these vendors either provide a quoted market price in an active market or use observable input for their pricing without applying significant adjustments. Broker pricing is used mainly when a quoted price is not available, the investment is not priced by the pricing vendors, or when a broker price is more reflective of fair value in the market in which the investment trades. The Company's broker priced investments are classified as Level 2 investments because the broker prices the investment based on similar assets without applying significant adjustments. The Company's restricted investment financial assets as of September 30, 2016 and June 30, 2016 are included within current and long-term restricted investments on the condensed consolidated balance sheets.

The Company's long-term debt is not measured at fair value in the condensed consolidated balance sheets. The fair value of debt is the estimated amount the Company would have to pay to transfer its debt, including any premium or discount attributable to the difference between the stated interest rate and market rate of interest at the balance sheet date. Fair values are based on valuations of similar debt at the balance sheet date and supported by observable market transactions when available: Level 2 of the fair value hierarchy.  At September 30, 2016 and June 30, 2016 the fair value of the Company's debt was not materially different than its carrying value.

Reclassification adjustments for realized gains or losses from available for sale restricted investment securities out of accumulated other comprehensive income are included in the condensed consolidated statements of operations within the insurance recoverables and other income line item.

The Company's contingent consideration liabilities, included in other accrued liabilities on the condensed consolidated balance sheets, are associated with the acquisitions made in the fiscal year ended June 30, 2015. The liabilities are measured at fair value using a probability weighted average of the potential payment outcomes that would occur should certain contract metrics be reached. There is no market data available to use in valuing the contingent consideration; therefore, the Company developed its own assumptions related to the achievement of the metrics to evaluate the fair value of these liabilities. As such, the contingent consideration is classified within Level 3 as described below.

Items classified as Level 3 within the valuation hierarchy, consisting of contingent consideration liabilities related to recent acquisitions, were valued based on various estimates, including probability of success, discount rates and amount of time until the conditions of the contingent payments are achieved. The table below presents a roll-forward of the contingent consideration liabilities valued using Level 3 inputs:

Contingent consideration balance at July 1, 2016	$	233
Decrease of liability related to re-measurement of fair value	(143		)
Contingent consideration balance at September 30, 2016	$	90

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Stock-Based Compensation

3 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Company has two plans under which outstanding stock-based awards have been issued: the TRC Companies, Inc. Restated Stock Option Plan (the "Restated Plan"), and the Amended and Restated 2007 Equity Incentive Plan (the "2007 Plan"), (collectively "the Plans"). The Company issues new shares or may utilize treasury shares, when available, to satisfy awards under the Plans. Awards are made by the Compensation Committee of the Board of Directors; however, the Compensation Committee has delegated to the Chief Executive Officer ("CEO") the authority to grant awards for up to 10 shares to employees subject to a limitation of 100 shares in any 12 month period.

Stock-based awards under the Plans consist of stock options, restricted stock awards ("RSA's"), restricted stock units ("RSU's") and performance stock units ("PSU's"). As of September 30, 2016, 1,915 shares remained available for grants under the 2007 Plan.

Stock-Based Compensation

The Company measures stock-based compensation cost at the grant date based on the fair value of the award. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company's condensed consolidated statements of operations. Stock-based compensation expense includes the estimated effects of forfeitures, and estimates of forfeitures will be adjusted over the requisite service period to the extent actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized in the period of change and will also impact the amount of expense to be recognized in future periods.

During the three months ended September 30, 2016 and September 25, 2015, the Company recognized stock-based compensation expense in cost of services ("COS") and general and administrative expenses within the condensed consolidated statements of operations as follows:

		Three Months Ended
		September 30, 2016		September 25, 2015
Cost of services		$	707	$	647
General and administrative expenses		750		622
	Total stock-based compensation expense	$	1,457	$	1,269

Stock Options

The Company uses the Black-Scholes option pricing model for determining the estimated grant date fair value for stock options. The fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. The risk-free interest rate assumption is based upon observed interest rates appropriate for the expected life of the employee stock options. The average expected life is based on the contractual term of the option and expected employee exercise and historical post-vesting employment termination experience. The Company estimates the volatility of its stock using historical volatility in accordance with current accounting guidance. Management determined that historical volatility of TRC common stock is most reflective of market conditions and the best indicator of expected volatility. The dividend yield assumption is based on the Company's historical and expected dividend payouts. There were no stock options granted during the three months ended September 30, 2016 and September 25, 2015.

A summary of stock option activity for the three months ended September 30, 2016 under the Plans is as follows:

					Weighted-
					Average
			Weighted-		Remaining
			Average		Contractual	Aggregate
			Exercise		Term	Intrinsic
	Options		Price		(in years)	Value
Outstanding options as of June 30, 2016 (85 exercisable)	85		$	8.28
Options expired	(1	)	$	9.80
Outstanding options as of September 30, 2016	84		$	8.26	0.5	$	61
Options exercisable as of September 30, 2016	84		$	8.26	0.5	$	61
Options vested and expected to vest as of September 30, 2016	84		$	8.26	0.5	$	61

The aggregate intrinsic value is measured using the fair market value at the date of exercise (for options exercised) or as of September 30, 2016 (for outstanding options), less the applicable exercise price. The closing price of the Company's common stock on the New York Stock Exchange was $8.67 as of September 30, 2016. The total intrinsic value of options exercised for the three months ended September 30, 2016 and September 25, 2015 was $0 and $87, respectively. The total proceeds received from option exercises for the three months ended September 30, 2016 and September 25, 2015 was $0 and $31, respectively.

Restricted Stock Awards

Compensation expense for RSA's is recognized ratably over the vesting term, which is generally four years. The fair value of the RSA's is determined based on the closing market price of the Company's common stock on the grant date. There was 1 non-vested RSA as of September 30, 2016. There were no RSA's granted during the three months ended September 30, 2016. As of September 30, 2016, there was $1 of total unrecognized compensation expense related to unvested RSA's under the Plans, and this expense is expected to be recognized over a weighted-average period of 0.2 years.

Restricted Stock Units

Compensation expense for RSU's is recognized ratably over the vesting term, which is generally four years. The fair value of RSU's is determined based on the closing market price of the Company's common stock on the grant date.

A summary of non-vested RSU activity for the three months ended September 30, 2016 is as follows:

			Weighted-
	Restricted		Average
	Stock		Grant Date
	Units		Fair Value
Non-vested units as of June 30, 2016	904		$	8.24
Units granted	517		$	6.17
Units vested	(132	)	$	7.85
Units forfeited	(23	)	$	10.71
Non-vested units as of September 30, 2016	1,266		$	7.34

RSU grants totaled 517 shares with a total weighted-average grant date fair value of $3,188 during the three months ended September 30, 2016. RSU grants totaled 13 shares with a total weighted-average grant date fair value of $150 during the three months ended September 25, 2015. The total fair value of RSU's vested during the three months ended September 30, 2016 was $966. The total fair value of RSU's vested during the three months ended September 25, 2015 was $2,781.

As of September 30, 2016, there was $7,862 of total unrecognized compensation expense related to unvested RSU's under the Plans, and this expense is expected to be recognized over a weighted-average period of 3.2 years.

Performance Stock Units

Compensation expense for PSU's is recognized ratably over the vesting term, which is generally four years, if and when the Company concludes that it is probable that the performance condition will be achieved. The Company reassesses the probability of vesting at each reporting period for awards with performance conditions and adjusts compensation expense based on its probability assessment. The fair value of the PSU's is determined based on the closing market price of the Company's common stock on the grant date.

The number of PSU's earned is determined based on the Company's performance against predefined targets. The range of payout is zero to 150% of the number of granted PSU's. The number of PSU's earned is determined based on actual performance at the end of the performance period. PSU grants totaled 512 and 0 with a total weighted-average grant date fair value of $3,152 and $0 during the three months ended September 30, 2016 and September 25, 2015, respectively. The total fair value of PSU's vested during the three months ended September 30, 2016, was $1,095. The total fair value of PSU's vested during the three months ended September 25, 2015, was $2,191.

At September 30, 2016, there was $7,452 of total unrecognized compensation expense related to non-vested PSU's; this expense is expected to be recognized over a weighted-average period of 2.8 years.

A summary of non-vested PSU activity for the three months ended September 30, 2016 is as follows:

						Weighted-
	PSU			Total		Average
	Original		PSU	PSU		Grant Date
	Awards		Adjustments (1)	Awards		Fair Value
Non-vested units as of June 30, 2016	895		—	895		$	8.74
Units granted	512		—	512		$	6.15
Units vested	(142	)	—	(142	)	$	7.72
Units forfeited	(40	)	—	(40	)	$	8.24
Non-vested units as of September 30, 2016	1,225		—	1,225		$	7.79

(1) Represents the additional number of PSU's issued based on the final performance condition achieved at the end of the respective performance period.

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Earnings per Share

3 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

Basic earnings per share ("EPS") is computed based on the weighted-average number of shares of common stock outstanding during the period. Diluted EPS is computed using the treasury stock method for stock options, warrants, non-vested restricted stock awards and units, and non-vested performance stock units. The treasury stock method assumes conversion of all potentially dilutive shares of common stock with the proceeds from assumed exercises used to hypothetically repurchase stock at the average market price for the period. Diluted EPS is computed by dividing net income applicable to the Company by the weighted-average common shares and potentially dilutive common shares that were outstanding during the period.

The following table sets forth the computations of basic and diluted EPS for the three months ended September 30, 2016 and September 25, 2015:

	Three Months Ended
	September 30, 2016		September 25, 2015
Net income applicable to TRC Companies, Inc.	$	3,639	$	4,492
Basic weighted-average common shares outstanding	31,149		30,635
Effect of dilutive stock options, RSA's, RSU's and PSU's	452		683
Diluted weighted-average common shares outstanding	31,601		31,318
Earnings per common share applicable to TRC Companies, Inc.
Basic earnings per common share	$	0.12	$	0.15
Diluted earnings per common share	$	0.12	$	0.14
Anti-dilutive stock options, RSA's, RSU's and PSU's, excluded from the calculation	1,611		821

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Accounts Receivable

3 Months Ended

Sep. 30, 2016

Receivables [Abstract]

Accounts Receivable

Accounts Receivable

The current portion of accounts receivable as of September 30, 2016 and June 30, 2016, were comprised of the following:

		September 30, 2016			June 30, 2016
Billed		$	101,430		$	90,194
Unbilled		72,370			64,954
Retainage		3,050			2,429
	Total accounts receivable - gross	176,850			157,577
Less allowance for doubtful accounts		(8,384		)	(8,297		)
	Total accounts receivable, less allowance for doubtful accounts	$	168,466		$	149,280

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Other Accrued Liabilities

3 Months Ended

Sep. 30, 2016

Accounts Payable and Accrued Liabilities, Current [Abstract]

Other Accrued Liabilities

Other Accrued Liabilities

As of September 30, 2016 and June 30, 2016, other accrued liabilities were comprised of the following:

		September 30, 2016		June 30, 2016
Contract costs		$	40,134	$	40,343
Legal accruals		5,325		5,232
Lease obligations		5,439		5,564
Other		6,643		6,887
	Total other accrued liabilities	$	57,541	$	58,026

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Business Acquisitions, Goodwill and Other Intangible Assets

3 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

Business Acquisitions, Goodwill and Other Intangible Assets

Business Acquisitions, Goodwill and Other Intangible Assets

Fiscal 2016 Acquisition

On November 30, 2015, the Company acquired the Professional Services business ("Oil and Gas") of Willbros Group ("Willbros") in an all cash transaction. The $124,498 purchase price consisted of (i) an initial cash payment of $119,955 paid at closing, and, (ii) a second cash payment due of $7,500 payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016, net of a working capital adjustment due from Willbros of $2,957. The second cash payment was made in two tranches, with $2,354 paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement. Goodwill of $60,294, all of which is expected to be tax deductible, and other intangible assets of $44,500 were recorded as a result of this acquisition.

The following summarizes the estimated fair values of the Oil and Gas assets acquired and liabilities assumed at the acquisition date, as well as measurement period adjustments:

			November 30, 2015 (As Initially Reported)			Measurement Period Adjustments			November 30, 2015 (As Adjusted)
Cash and cash equivalents			$	355		$	—		$	355
Accounts receivable			26,406			1,857			28,263
Prepaid expenses and other current assets			7,276			(48		)	7,228
Property and equipment			3,552			—			3,552
Identifiable intangible assets:
	Customer relationships and backlog		43,500			—			43,500
	Internally developed software		1,000			—			1,000
		Total identifiable intangible assets	44,500			—			44,500
Goodwill			64,673			(4,379		)	60,294
Other non-current assets			20,683			—			20,683
Accounts payable			(2,587		)	43			(2,544		)
Accrued compensation and benefits			(7,199		)	(2		)	(7,201		)
Other accrued liabilities			(5,210		)	100			(5,110		)
Current portion of long-term debt			(6,447		)	(38		)	(6,485		)
Long-term debt, net of current portion			(18,547		)	—			(18,547		)
Non-controlling interest			$	—		$	(490	)	$	(490	)
	Net assets acquired		$	127,455		$	(2,957	)	$	124,498

Customer relationships and backlog represent the fair value of existing contracts and the underlying customer relationships. The backlog has a 1 year life and customer relationships have lives ranging from 12 years to 15 years (weighted average lives of 6 years). The internally developed software has a life of approximately 5 years (weighted average life of 5 years).

The goodwill recognized is attributable to the future strategic growth opportunities arising from the acquisition, Oil and Gas's highly skilled assembled workforce, which does not qualify for separate recognition, and the expected cost synergies of the combined operations.

The unaudited pro forma financial information summarized in the following table gives effect to the Oil and Gas acquisition assuming it occurred on July 1, 2014. These unaudited pro forma operating results do not assume any impact from revenue, cost or other operating synergies that are expected as a result of the acquisition. Pro forma adjustments have been made to reflect amortization of the identified intangible assets for the related periods, as well as the amortization of deferred debt issuance costs incurred. Identifiable intangible assets are being amortized on a basis approximating the economic value derived from those assets. These unaudited pro forma operating results are presented for illustrative purposes only and are not indicative of the operating results that would have been achieved had the acquisition occurred on July 1, 2014, nor does the information project results for any future period.

	Three Months Ended
	September 25, 2015
Gross revenue	$	184,033
Net service revenue	131,709
Net income applicable to TRC Companies, Inc.	2,986
Basic earnings per common share	$	0.10
Diluted earnings per common share	$	0.10

Goodwill

The Company assesses goodwill for impairment on an annual basis as of each fiscal April period end, or at an interim date when events or changes in the business environment would more likely than not reduce the fair value of a reporting unit below its carrying value. As of September 30, 2016, the Company had $75,337 of goodwill, and does not believe there were any events or changes in circumstances since the last goodwill assessment as of April 29, 2016 that would indicate the fair value of goodwill was more likely than not reduced to below its carrying value. Accordingly, goodwill was not tested for impairment during the current fiscal quarter.

The carrying amount of goodwill for the three months ended September 30, 2016 by operating segment are as follows:

	Gross									Gross
	Balance,		Accumulated			Balance,				Balance,		Accumulated			Balance,
	July 1,		Impairment			July 1,		Additions /		September 30,		Impairment			September 30,
Operating Segment	2016		Losses			2016		Adjustments		2016		Losses			2016
Power	$	28,506	$	(14,506	)	$	14,000	$	—	$	28,506	$	(14,506	)	$	14,000
Environmental	40,889		(17,865		)	23,024		—		40,889		(17,865		)	23,024
Infrastructure	7,224		(7,224		)	—		—		7,224		(7,224		)	—
Oil and Gas	60,294		(21,981		)	38,313		—		60,294		(21,981		)	38,313
	$	136,913	$	(61,576	)	$	75,337	$	—	$	136,913	$	(61,576	)	$	75,337

Other Intangible Assets

Identifiable intangible assets as of September 30, 2016 and June 30, 2016 are included in other assets on the condensed consolidated balance sheets and were comprised of:

	September 30, 2016							June 30, 2016
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
Identifiable intangible assets	Amount		Amortization			Amount		Amount		Amortization			Amount
With determinable lives:
Customer relationships	$	59,218	$	(17,374	)	$	41,844	$	59,218	$	(14,933	)	$	44,285
Contract backlog	900		(750		)	150		900		(525		)	375
Technology	1,000		(167		)	833		1,000		(117		)	883
	61,118		(18,291		)	42,827		61,118		(15,575		)	45,543
With indefinite lives:
Engineering licenses	426		—			426		426		—			426
	$	61,544	$	(18,291	)	$	43,253	$	61,544	$	(15,575	)	$	45,969

Identifiable intangible assets with determinable lives are amortized over their estimated useful lives and are also reviewed for impairment if events or changes in circumstances indicate that their carrying amount may not be realizable.

Identifiable intangible assets with determinable lives are being amortized over a weighted-average period of approximately 7 years. The weighted-average period of amortization is approximately 7 years for customer relationship assets. The amortization of intangible assets for the three months ended September 30, 2016 was $2,716. The amortization of intangible assets for the three months ended September 25, 2015 was $840.

Estimated amortization expense of intangible assets for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

Fiscal Year		Amount
2017		$	7,443
2018		9,183
2019		8,367
2020		7,821
2021		7,274
2022 and Thereafter		2,739
	Total	$	42,827

On an annual basis, or more frequently if events or changes in circumstances indicate that the asset might be impaired, the fair value of the indefinite-lived intangible assets is evaluated by the Company to determine if an impairment charge is required. The Company performed its most recent annual impairment assessment as of April 29, 2016, which resulted in no impairments to intangible assets. There were no events or changes in circumstances that would indicate the fair value of intangible assets was reduced to below its carrying value during the three months endedSeptember 30, 2016, and therefore intangible assets were not tested for impairment.

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Long-Term Debt and Capital Lease Obligations

3 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Long-Term Debt and Capital Lease Obligations

Long-Term Debt and Capital Lease Obligations

Revolving Credit Facility

On November 30, 2015, the Company entered into a five-year credit agreement (the “Credit Agreement”) with Citizens Bank, N.A. as lender, LC issuer, administrative agent, sole lead arranger, and sole book runner; BMO Harris Bank, N.A. as lender, LC issuer and syndication agent; KeyBank, N.A. as lender and document agent, and five other banks as lenders. The Credit Agreement provides the Company with an aggregate borrowing capacity of $175,000, consisting of a $100,000five-year secured revolving credit facility (“Revolving Facility”) with a sub-limit of $15,000 available for the issuance of letters of credit, as well as a five-year secured $75,000 term loan (“Term Loan”).

The proceeds of the Term Loan, together with cash on hand and proceeds from borrowing under the Revolving Facility, were used to pay the purchase price for Willbros Professional Services ("Oil and Gas") and to fund transaction costs incurred in connection with the Oil and Gas acquisition. The Revolving Facility will also be available for working capital and general corporate purposes. The Revolving Facility includes borrowing capacity for letters of credit and for borrowings on same-day notice, referred to as “swingline loans.” Borrowings under the Revolving Facility are subject to the satisfaction of customary conditions, including absence of defaults and accuracy of representations and warranties. The Company may request an increase in the amount of the Credit Agreement up to an additional $75,000, which may be through additional term or revolving loans.

Borrowings outstanding under the Revolving Facility will mature on November 30, 2020. The Term Loan amortizes in quarterly installments payable on the last day of each March, June, September, and December, commencing on March 31, 2016 in amounts equal to 1.875% of the term loan made or outstanding, with the balance payable on November 30, 2020 (the "Term Loan Maturity Date.") In addition, the Company is required, subject to certain exceptions, to make payments on the Term Loan (a) based on a stated percentage of Excess Cash Flow, either 50% or 0% depending on whether the the Company's consolidated leverage is above or below 2 times adjusted EBITDA as defined in the Credit Agreement, (b) in an amount of 100% of net cash proceeds from asset sales subject to certain reinvestment rights, (c) in an amount of 100% of net cash proceeds of any issuance of debt other than debt permitted to be incurred under the Credit Agreement, and (d) in an amount of 100% of net cash proceeds from events of loss subject to certain reinvestment rights. The borrowings under the Credit Agreement may be reduced, in whole or in part, without premium or penalty.

Amounts outstanding under the Credit Agreement bear interest at the Base Rate (as defined, generally the prime rate) plus a margin of 0.50% to 1.25%, or at the Eurodollar Rate (as defined, generally the LIBOR rate) plus a margin of 1.50% to 2.25%, based on the Company's Leverage Ratio (as defined). In addition to these borrowing rates, there is a commitment fee which ranges from 0.20% to 0.375% on any unused commitments. The applicable fees for issuance of letters of credit under the Revolving Facility is a range from 1.50% to 2.25%.

The Company’s obligations under the Credit Agreement are secured by a pledge of substantially all of its assets and guaranteed by its principal operating subsidiaries. The Credit Agreement also contains cross-default provisions which become effective if the Company defaults on other indebtedness.

The Credit Agreement contains various customary restrictive covenants that limit the Company's ability to, among other things: incur additional indebtedness including guarantees; enter into sale/leaseback transactions; make investments, loans or acquisitions; grant or incur liens on its assets; sell its assets; engage in mergers, consolidations, liquidations or dissolutions; engage in transactions with affiliates; and make restricted payments. Under the Credit Agreement the Company is required to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00 and to not permit its leverage ratio to exceed 3.00 to 1.00. The Credit Agreement also limits the payment of cash dividends to $10,000 in aggregate during its term.

On November 30, 2015, the Company borrowed $102,000 under the Credit Agreement to partially fund the Oil and Gas acquisition. The borrowing was comprised of a full borrowing of the $75,000 term loan and a $27,000 borrowing under the Revolving Facility. Borrowings under the Term Loan bear interest at a stated rate of 2.02% and have an effective interest rate of 2.07% at September 30, 2016. As of September 30, 2016 the Company had zero borrowings outstanding under the Credit Agreement's Revolving Facility and $70,781 outstanding under the Term Loan. Funds available to borrow under the Credit Agreement, after consideration of the letters of credit outstanding, were $97,346 at September 30, 2016.

In accounting for the transaction costs incurred in conjunction with the Credit Agreement, the Company allocated the total costs incurred based on the relative fair values of the Revolving Facility and Term Loan. A total of $1,916 and $1,332 were allocated to the Revolving Facility and Term Loan, respectively.

As of September 30, 2016, the Term Loan consisted of the following:

Current portion of Term Loan	$	5,625
Long-term portion of Term Loan	$	65,156
Less: Debt issuance costs	(1,074		)
Net long-term carrying amount	$	64,082

The scheduled principal amounts due under the Company’s Term Loan obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years are as follows:

2017		$	4,219
2018		5,625
2019		5,625
2020		5,625
2021		49,687
	Total	$	70,781

Contractor-owned, contractor-operated (CoCo) facility debt

As of September 30, 2016, the Company had approximately $20,793 of debt obligations ("CoCo" debt) assumed in the Oil and Gas acquisition, of which $7,656 was current.  A third party finance company had provided financing to Oil and Gas in conjunction with the construction of fueling facilities for the federal government pursuant to three government contracts. Upon acceptance of the constructed facilities, the federal government pays Oil and Gas in equal monthly installments over the subsequent five years. Therefore, as of September 30, 2016, the Company also had recorded approximately $20,793 of receivables which were acquired in the transaction, of which $7,656 was current. These amounts were recorded within other assets and represent the amount due from the federal government for the construction of the fueling facilities.

As of September 30, 2016, the government has provided acceptance and final funding on all three contracts.

The principal amounts due under the Company’s remaining CoCo debt obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

2017		$	5,974
2018		5,734
2019		3,717
2020		3,980
2021		1,388
	Total	$	20,793

Other Notes Payable

In July 2016, the Company financed $3,838 of insurance premiums payable in seven equal monthly installments of $552 each, including a finance charge of 2.19%. As of September 30, 2016, the balance outstanding under this agreement was $2,199.

In conjunction with the Oil and Gas acquisition, the Company was required to remit a second cash payment of $7,500 payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016. The second cash payment was made in two tranches, with $2,354 paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement.

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Variable Interest Entity

3 Months Ended

Sep. 30, 2016

Variable Interest Entity [Abstract]

Variable Interest Entity

Variable Interest Entity

In determining whether the Company is the primary beneficiary of an entity, it considers a number of factors, including its ability to direct the activities that most significantly affect the entity's economic success, the Company's contractual rights and responsibilities under the arrangement and the significance of the arrangement to each party. These considerations impact the way the Company accounts for its existing collaborative and joint venture relationships and determines the consolidation of companies or entities with which the Company has collaborative or other arrangements.

WBA

Willbros Engineers LLC, which the Company acquired in fiscal 2016, was party to an option and service arrangement with the equity owners of WBA, a limited liability company. WBA is considered a VIE due to the lack of decision-making rights by its equity holders. The Company consolidates the operations of WBA, as it retains the contractual power to direct the activities of WBA which most significantly and directly impact its economic performance. The Company also has the obligation to absorb losses and the right to receive residual returns of WBA. The activity of WBA is not significant to the overall performance of the Company. The assets of WBA are available for the Company's general business use outside the context of WBA. In consolidation, as of September 30, 2016, $362 of cash and cash equivalents, $262 of accounts receivables and $3 of other current liabilities were attributable to WBA.

While the Company is currently in the process of winding down the operations of WBA, it has an obligation to fund operating activities not covered by WBA’s available cash and cash flow from operations. During fiscal year 2017, the Company provided $7 of financial support to WBA. The Company does not expect ongoing funding obligations to be material.

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Income Taxes

3 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company's effective tax rate was approximately 32.1% and 41.3% for the three months ended September 30, 2016 and September 25, 2015 respectively. The primary reconciling items between the federal statutory rate of 35.0% and the Company's overall effective tax rate for the three months ended September 30, 2016 were the effect of state income taxes offset by tax benefits related to the U.S. Research and Development credit, U.S. Domestic Production Activities deduction and the effective settlement of uncertain tax positions. The primary reconciling items between the federal statutory rate of 35.0% and the Company's overall effective tax rate for the three months ended September 25, 2015 were the effect of state income taxes.

As of September 30, 2016, the recorded liability for uncertain tax positions under the measurement criteria of Accounting Standards Codification ("ASC") Topic 740, Income Taxes, was $903. The effective settlement of uncertain tax positions resulted in a decrease in the recorded liability of $1,344 during the three months ended September 30, 2016, which resulted in a net decrease to the provision for income taxes of $294. The Company does not expect the amount of unrecognized tax benefits to materially change within the next twelve months.

As a result of the early adoption of ASU 2016-09 in the three months ended September 30, 2016, excess tax benefits and tax deficiencies will be classified to the statement of operations prospectively instead of additional paid-in capital. The Company's effective tax rate for the three months ended September 30, 2016 was not materially impacted by the adoption of ASU 2016-09. The Company recorded a net tax deficiency of $6 during the three months ended September 30, 2016 which discretely increased the provision for income taxes.

In the first quarter of fiscal year 2017, the IRS concluded its income tax examination for fiscal year 2014. No adjustments were proposed.

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Operating Segments

3 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Operating Segments

Operating Segments

To more clearly communicate the Company's capabilities and focus to the marketplace, beginning in fiscal 2017, the Company renamed its Energy segment “Power” and its Pipeline Services segment “Oil and Gas.” The Company manages its business under the following four operating segments:

Power (formerly Energy): The Power operating segment provides services to a range of clients including energy companies, power utilities, other commercial entities, and state and federal government entities. The Company's services include program management, engineer/procure/construct projects, design, and consulting. The Company's typical projects involve upgrades, design and new construction for electric transmission and distribution systems and substations; energy efficiency program design and management; and renewable energy development and power generation.

Environmental: The Environmental operating segment provides services to a wide range of clients including industrial, transportation, energy and natural resource companies, as well as federal, state and municipal agencies. The Environmental operating segment is organized to focus on key areas of demand including: environmental management of buildings and facilities; air quality measurements and modeling of potential air pollution impacts; water quality and water resource management; assessment and remediation of contaminated sites and buildings; hazardous waste management; construction monitoring, inspection and management; environmental, health and safety management and sustainability advisory services; compliance auditing and strategic due diligence; environmental licensing and permitting of a wide variety of projects; and natural and cultural resource assessment, protection and management.

Infrastructure: The Infrastructure operating segment provides services related to the expansion of infrastructure capacity and the rehabilitation of overburdened and deteriorating infrastructure systems. The Company's client base is predominantly state and municipal governments as well as select commercial developers. In addition, the Company provides infrastructure services on projects originating in its Power and Environmental operating segments. Primary services include: roadway, bridge and related surface transportation design; structural design and inspection of bridges; program management; construction engineering inspection and construction management for roads and bridges; civil engineering for municipalities and public works departments; geotechnical engineering services; and security assessments, design and construction management.

Oil & Gas (formerly Pipeline Services): The Oil & Gas operating segment provides pipeline and facilities engineering; engineer, procure, and construct ("EPC") services; engineer, procure, construct and management ("EPCm") services; field services and integrity services to the oil and gas transmission and midstream markets, as well as at government facilities. The Company specializes in providing engineering services to assist clients in designing, engineering and constructing or expanding pipeline systems, compressor stations, pump stations, fuel storage facilities, terminals, and field gathering and production facilities. The Company's expertise extends to the engineering of a wide range of project peripherals, including various types of support buildings and utility systems, power generation and electrical transmission systems, communications systems, fire protection, water and sewage treatment, water transmission, roads and railroad sidings. The Company also provides project management, engineering and material procurement services to the refining industry and government agencies, including mechanical, civil, structural, electrical instrumentation/controls and environmental engineering. The Company provides full-service integrity management program offerings including program development, data services, risk analysis, corrosion evaluation, integrity engineering and integrity construction services. The Company is partnered with Google to provide a cloud-based pipeline life-cycle integrity management solution, Integra Link™, which utilizes Google’s geospatial technology platform to help oil and gas pipeline companies visualize and utilize their data and information.

The Company's chief operating decision maker ("CODM") is its CEO. The Company's CEO manages the business by evaluating the financial results of the four operating segments focusing primarily on segment revenue and segment profit. The Company utilizes segment revenue and segment profit because it believes they provide useful information for effectively allocating resources among operating segments; evaluating the health of its operating segments based on metrics that management can actively influence; and gauging its investments and its ability to service, incur or pay down debt. Specifically, the Company's CEO evaluates segment revenue and segment profit and assesses the performance of each operating segment based on these measures, as well as, among other things, the prospects of each of the operating segments and how they fit into the Company's overall strategy. The Company's CEO then decides how resources should be allocated among its operating segments. The Company does not track its assets by operating segment, and consequently, it is not practical to show assets by operating segment. Segment profit includes all operating expenses except the following: costs associated with providing corporate shared services (including certain depreciation and amortization), goodwill and intangible asset write-offs, and stock-based compensation expense. Depreciation expense is primarily allocated to operating segments based upon their respective use of total operating segment office space. Assets solely used at the Corporate level are not allocated to the operating segments. Inter-segment balances and transactions are not material. The accounting policies of the operating segments are the same as those for the Company as a whole, except as discussed herein.

On July 1, 2016 the Company made certain changes to its management reporting structure which resulted in a change to the composition of the Infrastructure operating segment. Certain corporate employees were transferred to the Infrastructure operating segment. As a result, beginning in fiscal year 2017 the Company reports its financial performance based on the current reporting structure. The Company has recast certain prior period amounts to conform to the way it internally manages and monitors segment performance. These changes had no impact on consolidated net income or cash flows and were not material to the segment measurements presented.

The following tables present summarized financial information for the Company's operating segments (for the periods noted below): 

	Power		Environmental		Infrastructure		Oil & Gas		Total
Three months ended Sept. 30, 2016:
Gross revenue	$	56,995	$	73,936	$	22,913	$	26,638	$	180,482
Net service revenue	37,100		48,894		16,630		21,338		123,962
Segment profit	7,967		9,052		4,309		1,371		22,699
Depreciation	444		645		138		352		1,579
Amortization	248		274		—		2,067		2,589
Three months ended Sept. 25, 2015:
Gross revenue	$	39,237	$	75,843	$	19,970	$	—	$	135,050
Net service revenue	34,338		51,564		13,562		—		99,464
Segment profit	7,312		9,982		2,893		—		20,187
Depreciation	465		624		97		—		1,186
Amortization	300		365		—		—		665

	Three Months Ended
Gross revenue	September 30, 2016			September 25, 2015
Gross revenue from reportable operating segments	$	180,482		$	135,050
Reconciling items (1)	369			409
Total consolidated gross revenue	$	180,851		$	135,459
Net service revenue
Net service revenue from reportable operating segments	$	123,962		$	99,464
Reconciling items (1)	343			699
Total consolidated net service revenue	$	124,305		$	100,163
Income from operations before taxes
Segment profit from reportable operating segments	$	22,699		$	20,187
Corporate shared services (2)	(14,949		)	(9,954		)
Stock-based compensation expense	(1,457		)	(1,269		)
Unallocated acquisition and integration expenses	—			(878		)
Unallocated depreciation and amortization	(336		)	(413		)
Interest income	278			—
Interest expense	(845		)	(28		)
Total consolidated (loss) income from operations before taxes	$	5,390		$	7,645
Acquisition and integration expenses
Acquisition and integration expenses from reportable operating segments	$	—		$	—
Unallocated acquisition and integration expenses	—			878
Total consolidated acquisition and integration expenses	$	—		$	878
Depreciation and amortization
Depreciation and amortization from reportable operating segments	$	4,168		$	1,851
Unallocated depreciation and amortization	336			413
Total consolidated depreciation and amortization	$	4,504		$	2,264

(1) Amounts represent certain unallocated corporate amounts not considered in the CODM's evaluation of operating segment performance.

(2) Corporate shared services consist of centrally managed functions in the following areas: accounting, treasury, information technology, legal, human resources, marketing, internal audit and executive management such as the CEO and various executives. These costs and other items of a general corporate nature are not allocated to the Company’s four operating segments.

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Commitments and Contingencies

3 Months Ended

Sep. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Exit Strategy Contracts

The Company has entered into a number of long-term contracts pursuant to its Exit Strategy program under which it is obligated to complete the remediation of environmental conditions at covered sites. The Company assumes the risk for remediation costs for pre-existing environmental conditions and believes that through in-depth technical analysis, comprehensive cost estimation and creative remedial approaches it is able to execute strategies which protect the Company's return on these projects. The Company's client pays a fixed price and, as additional protection, for a majority of the contracts the client also pays for a cleanup cost cap insurance policy. The policy, which includes the Company as a named or additional insured party, provides coverage for cost increases from unknown or changed conditions up to a specified maximum amount significantly in excess of the estimated cost of remediation. The Company believes that it is adequately protected from risk on these projects and that it is not likely that it will incur material losses in excess of applicable insurance. However, because several projects are near the term or financial limits of the insurance, the Company believes it is reasonably possible that events could occur under certain circumstances which could be material to the Company's consolidated financial statements. With respect to these projects, there is a wide range of potential outcomes that may result in costs being incurred beyond the limits or term of insurance, such as: (i) greater than expected volumes of contaminants requiring remediation; (ii) treatment systems requiring operation beyond the insurance term; and (iii) greater than expected allocable share of the ultimate remedy. The Company does not believe these outcomes are likely, and the exact nature, impact and duration of any such occurrence could vary due to a number of factors. Accordingly, the Company is unable to provide an estimate of potential loss with a reasonable degree of accuracy. Nevertheless, if these events were to occur, the Company believes that it is reasonably possible that the amount of costs currently accrued, which represents the Company's best estimate, could increase by as much as $25,000, of which $4,000 would be covered by insurance.

With respect to one of the projects noted above, the regulatory agency charged with oversight of the project approved a remedial plan that is more expensive than the remedy that had been proposed by the Company. A cost allocation among the potentially responsible parties has not been finalized. However, the Company (and the party from whom it assumed site responsibility) did not contribute in any way to the site contamination, and the Company believes that it has meritorious defenses to liability and that it will not ultimately be responsible for any material remedial costs attributable to the more costly selected remedy. Nevertheless, due to uncertainty over the cost allocation process, it is reasonably possible that the Company's recorded estimate could change. With respect to another one of these projects, the regulatory agency charged with oversight of the project selected a remedy that appears to be consistent with regulatory guidance and the Company’s estimates. However, until the final remedy is formally adopted following a public notice period, it remains reasonably possible that the selected remedial alternative could change and the related costs could increase. The Company's estimated share of the potential remedial cost changes related to these two projects range from $0 to $18,600.

The Company adjusts all of its recorded liabilities as further information develops or circumstances change. The Company is unable to accurately project the time period over which these amounts would ultimately be paid out, however the Company estimates that any potential payments could be made over a 1 to 5 year period.  

Contract Damages

The Company has entered into contracts which, among other things, require completion of the specified scope of work within a defined period of time or a defined budget. Certain of those contracts provide for the assessment of liquidated or other damages if certain project objectives are not met pursuant to the terms of the contract. At present, the Company does not believe a material assessment of such damages is reasonably possible.

Government Contracts

The Company's indirect cost rates applied to contracts with the U.S. Government and various state agencies are subject to examination and renegotiation. Contracts and other records of the Company with respect to federal contracts have been examined through June 30, 2008. The Company believes that adjustments resulting from such examination or renegotiation proceedings, if any, will not likely have a material impact on the Company's business, operating results, financial position and cash flows.

Insurance Captive

During fiscal 2016, the Company became a shareholder in a member-owned heterogeneous (various industries) group captive reinsurance company. The policies of the program are placed with a U.S. insurance carrier, which provides coverage for workers' compensation, general liability and auto liability, with a certain initial layer of loss being reinsured to the carrier by the captive. The Company’s annual premiums are actuarially determined based on historical loss experience, and also include administrative costs and fees. In addition, the captive is designed to have an acceptable level of risk sharing among its members. For a given policy period, if the Company’s actual loss experience is greater than the estimate, the Company is required to make additional payments to the captive up to a maximum predetermined level. If the Company’s loss experience is less than the estimate, the Company may receive a shareholder distribution, when declared by the captive's Board of Directors. The Company records any additional costs or distributions received from the captive in the period in which the Company is notified of the amount due or distribution to be received. The Company has not recorded any additional liability or receivable as of September 30, 2016.

Legal Matters

The Company and its subsidiaries are subject to claims and lawsuits typical of those filed against engineering and consulting companies. The Company carries liability insurance, including professional liability insurance, against such claims subject to certain deductibles and policy limits. Except as described herein, management is of the opinion that the resolution of these claims and lawsuits will not likely have a material effect on the Company's operating results, financial position and cash flows.

TRC Environmental Corporation v. LVI Group Services, Inc., United States District Court for the Western District of Texas, Austin Division 2014.TRC was the prime contractor on a project to demolish and decommission a power plant in Austin, Texas. LVI was a subcontractor on that project, and TRC sued LVI for approximately $3,000 for breaches in connection with LVI’s work. LVI filed a number of responsive pleadings in this lawsuit including a counterclaim for approximately $9,900. TRC believes that its claims against LVI are meritorious and that LVI’s counterclaim is without merit. Nevertheless, an adverse determination on LVI’s counterclaim could have a material adverse effect on the Company’s business, operating results, financial position and cash flows.

The Company records actual or potential litigation-related losses in accordance with ASC Topic 450 "Contingencies". As of September 30, 2016 and June 30, 2016, the Company had recorded litigation accruals of $4,627 and $4,869, respectively. The Company also had insurance recovery receivables related to the aforementioned litigation-related accruals of $2,254 and $2,661 as of September 30, 2016 and June 30, 2016, respectively.

The Company periodically adjusts the amount of such liabilities when such actual or potential liabilities are paid or otherwise discharged, new claims arise, or additional relevant information about existing or potential claims becomes available. The Company believes that it is reasonably possible that the amount of potential litigation-related liabilities could increase by as much as $11,300, of which $2,100 would be covered by insurance.

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New Accounting Pronouncements (Policies)

3 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

New Accounting Pronouncements, Policy

New Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board ("FASB") issued an accounting standards update which simplifies employee share-based payment accounting. This standard simplifies the income tax consequences, accounting for forfeitures and classification on the statement of cash flows. The standard requires that, prospectively, all tax effects related to share-based payments be made through the income statement at the time of settlement as opposed to excess tax benefits being recognized in additional paid-in-capital under the current guidance. The standard also removes the requirement to delay recognition of a tax benefit until it reduces current taxes payable. This change is required to be applied on a modified retrospective basis, with a cumulative-effect adjustment to opening retained earnings. Additionally, all tax related cash flows resulting from share-based payments are to be reported as operating activities on the statement of cash flows, a change from the current requirement to present tax benefits as an inflow from financing activities and an outflow from operating activities. Finally, entities will be allowed to withhold an amount up to the employees’ maximum individual tax rate (as opposed to the minimum statutory tax rate) in the relevant jurisdiction without resulting in liability classification of the award. The change in withholding requirements will be applied on a modified retrospective approach. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The Company adopted this standard effective for its first quarter of fiscal 2017. The impact of the early adoption resulted in the following:

• The Company recorded a tax deficiency of $6 within income tax expense for the three months ended September 30, 2016 related to the tax shortfall on share based awards. Prior to adoption this amount would have been recorded as a decrease of capital in excess of par value. This change could create volatility in the Company's effective tax rate.

• The Company no longer reflects the cash received from the excess tax benefit within cash flows from financing activities but instead now reflects this benefit within cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows. The Company elected to apply this change in presentation prospectively and thus prior periods have not been adjusted.

• The Company elected not to change its policy on accounting for forfeitures and continues to estimate the total number of awards for which the requisite service period will not be rendered.

• The Company’s statutory withholding requirements have been updated to allow withholding up to the Company's maximum statutory withholding requirements in relevant jurisdictions.

• The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of our diluted earnings per share for the three months ended September 30, 2016. This increased diluted weighted average common shares outstanding by less than 24 shares for the period.

In February 2016, the FASB issued an accounting standards update which will replace most existing lease accounting guidance. This standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. This standard will be effective for the Company's fiscal year beginning July 1, 2019. Early adoption is permitted and should be applied using a modified retrospective approach.   The Company is in the process of evaluating the potential impacts of this standard on its condensed consolidated financial statements and related disclosures, including potential early adoption.

In May 2014, the FASB issued an accounting standards update that replaces existing revenue recognition guidance. The updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In March 2016, the FASB further clarified the implementation guidance on principal versus agent considerations. The new standard will be effective for the Company's fiscal year beginning July 1, 2018. Early adoption is permitted under this standard for annual periods beginning after December 15, 2016, and it is to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. The Company has not yet selected a transition method and is currently evaluating the effect the standard will have on its condensed consolidated financial statements.

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Fair Value Measurements (Tables)

3 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements, Recurring and Nonrecurring

The following tables present the level within the fair value hierarchy at which the Company's financial assets and certain liabilities were measured on a recurring basis as of September 30, 2016 and June 30, 2016:

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of September 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	72	$	—	$	—	$	72
Certificates of deposit	—		106		—		106
Municipal bonds	—		543		—		543
Corporate bonds	—		344		—		344
U.S. Government bonds	—		218		—		218
U.S. Treasury Notes	1,995		—		—		1,995
Money market accounts and cash deposits	6,399		—		—		6,399
Total assets	$	8,466	$	1,211	$	—	$	9,677
Contingent consideration	$	—	$	—	$	90	$	90
Total liabilities	$	—	$	—	$	90	$	90

Assets and Liabilities Measured at Fair Value on a Recurring Basis as of June 30, 2016

	Level 1		Level 2		Level 3		Total
Restricted investments:
Mutual funds	$	71	$	—	$	—	$	71
Certificates of deposit	—		107		—		107
Municipal bonds	—		547		—		547
Corporate bonds	—		439		—		439
U.S. Government bonds	—		219		—		219
U.S. Treasury Notes	2,009		—		—		2,009
Money market accounts and cash deposits	6,476		—		—		6,476
Total assets	$	8,556	$	1,312	$	—	$	9,868
Contingent consideration	$	—	$	—	$	233	$	233
Total liabilities	$	—	$	—	$	233	$	233

Rollforward of contingent consideration liabilities

The table below presents a roll-forward of the contingent consideration liabilities valued using Level 3 inputs:

Contingent consideration balance at July 1, 2016	$	233
Decrease of liability related to re-measurement of fair value	(143		)
Contingent consideration balance at September 30, 2016	$	90

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Stock-Based Compensation (Tables)

3 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

During the three months ended September 30, 2016 and September 25, 2015, the Company recognized stock-based compensation expense in cost of services ("COS") and general and administrative expenses within the condensed consolidated statements of operations as follows:

		Three Months Ended
		September 30, 2016		September 25, 2015
Cost of services		$	707	$	647
General and administrative expenses		750		622
	Total stock-based compensation expense	$	1,457	$	1,269

Schedule of Share-based Compensation, Stock Options, Activity

A summary of stock option activity for the three months ended September 30, 2016 under the Plans is as follows:

					Weighted-
					Average
			Weighted-		Remaining
			Average		Contractual	Aggregate
			Exercise		Term	Intrinsic
	Options		Price		(in years)	Value
Outstanding options as of June 30, 2016 (85 exercisable)	85		$	8.28
Options expired	(1	)	$	9.80
Outstanding options as of September 30, 2016	84		$	8.26	0.5	$	61
Options exercisable as of September 30, 2016	84		$	8.26	0.5	$	61
Options vested and expected to vest as of September 30, 2016	84		$	8.26	0.5	$	61

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity

A summary of non-vested RSU activity for the three months ended September 30, 2016 is as follows:

			Weighted-
	Restricted		Average
	Stock		Grant Date
	Units		Fair Value
Non-vested units as of June 30, 2016	904		$	8.24
Units granted	517		$	6.17
Units vested	(132	)	$	7.85
Units forfeited	(23	)	$	10.71
Non-vested units as of September 30, 2016	1,266		$	7.34

Disclosure of Compensation Related Costs, Share-based Payments

A summary of non-vested PSU activity for the three months ended September 30, 2016 is as follows:

						Weighted-
	PSU			Total		Average
	Original		PSU	PSU		Grant Date
	Awards		Adjustments (1)	Awards		Fair Value
Non-vested units as of June 30, 2016	895		—	895		$	8.74
Units granted	512		—	512		$	6.15
Units vested	(142	)	—	(142	)	$	7.72
Units forfeited	(40	)	—	(40	)	$	8.24
Non-vested units as of September 30, 2016	1,225		—	1,225		$	7.79

(1) Represents the additional number of PSU's issued based on the final performance condition achieved at the end of the respective performance period.

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Earnings per Share (Tables)

3 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table sets forth the computations of basic and diluted EPS for the three months ended September 30, 2016 and September 25, 2015:

	Three Months Ended
	September 30, 2016		September 25, 2015
Net income applicable to TRC Companies, Inc.	$	3,639	$	4,492
Basic weighted-average common shares outstanding	31,149		30,635
Effect of dilutive stock options, RSA's, RSU's and PSU's	452		683
Diluted weighted-average common shares outstanding	31,601		31,318
Earnings per common share applicable to TRC Companies, Inc.
Basic earnings per common share	$	0.12	$	0.15
Diluted earnings per common share	$	0.12	$	0.14
Anti-dilutive stock options, RSA's, RSU's and PSU's, excluded from the calculation	1,611		821

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Accounts Receivable (Tables)

3 Months Ended

Sep. 30, 2016

Receivables [Abstract]

Current portion of accounts receivable and schedule of allowance for doubtful accounts

The current portion of accounts receivable as of September 30, 2016 and June 30, 2016, were comprised of the following:

		September 30, 2016			June 30, 2016
Billed		$	101,430		$	90,194
Unbilled		72,370			64,954
Retainage		3,050			2,429
	Total accounts receivable - gross	176,850			157,577
Less allowance for doubtful accounts		(8,384		)	(8,297		)
	Total accounts receivable, less allowance for doubtful accounts	$	168,466		$	149,280

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Other Accrued Liabilities (Tables)

3 Months Ended

Sep. 30, 2016

Accounts Payable and Accrued Liabilities, Current [Abstract]

Schedule of Accrued Liabilities

As of September 30, 2016 and June 30, 2016, other accrued liabilities were comprised of the following:

		September 30, 2016		June 30, 2016
Contract costs		$	40,134	$	40,343
Legal accruals		5,325		5,232
Lease obligations		5,439		5,564
Other		6,643		6,887
	Total other accrued liabilities	$	57,541	$	58,026

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Business Acquisitions, Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Sep. 30, 2016

Sep. 25, 2015

Business Combinations [Abstract]

Schedule of assets acquired and liabilities assumed

The following summarizes the estimated fair values of the Oil and Gas assets acquired and liabilities assumed at the acquisition date, as well as measurement period adjustments:

			November 30, 2015 (As Initially Reported)			Measurement Period Adjustments			November 30, 2015 (As Adjusted)
Cash and cash equivalents			$	355		$	—		$	355
Accounts receivable			26,406			1,857			28,263
Prepaid expenses and other current assets			7,276			(48		)	7,228
Property and equipment			3,552			—			3,552
Identifiable intangible assets:
	Customer relationships and backlog		43,500			—			43,500
	Internally developed software		1,000			—			1,000
		Total identifiable intangible assets	44,500			—			44,500
Goodwill			64,673			(4,379		)	60,294
Other non-current assets			20,683			—			20,683
Accounts payable			(2,587		)	43			(2,544		)
Accrued compensation and benefits			(7,199		)	(2		)	(7,201		)
Other accrued liabilities			(5,210		)	100			(5,110		)
Current portion of long-term debt			(6,447		)	(38		)	(6,485		)
Long-term debt, net of current portion			(18,547		)	—			(18,547		)
Non-controlling interest			$	—		$	(490	)	$	(490	)
	Net assets acquired		$	127,455		$	(2,957	)	$	124,498

Schedule of pro forma information

These unaudited pro forma operating results are presented for illustrative purposes only and are not indicative of the operating results that would have been achieved had the acquisition occurred on July 1, 2014, nor does the information project results for any future period.

	Three Months Ended
	September 25, 2015
Gross revenue	$	184,033
Net service revenue	131,709
Net income applicable to TRC Companies, Inc.	2,986
Basic earnings per common share	$	0.10
Diluted earnings per common share	$	0.10

Schedule of goodwill

The carrying amount of goodwill for the three months ended September 30, 2016 by operating segment are as follows:

	Gross									Gross
	Balance,		Accumulated			Balance,				Balance,		Accumulated			Balance,
	July 1,		Impairment			July 1,		Additions /		September 30,		Impairment			September 30,
Operating Segment	2016		Losses			2016		Adjustments		2016		Losses			2016
Power	$	28,506	$	(14,506	)	$	14,000	$	—	$	28,506	$	(14,506	)	$	14,000
Environmental	40,889		(17,865		)	23,024		—		40,889		(17,865		)	23,024
Infrastructure	7,224		(7,224		)	—		—		7,224		(7,224		)	—
Oil and Gas	60,294		(21,981		)	38,313		—		60,294		(21,981		)	38,313
	$	136,913	$	(61,576	)	$	75,337	$	—	$	136,913	$	(61,576	)	$	75,337

Schedule of identifiable intangible assets

Identifiable intangible assets as of September 30, 2016 and June 30, 2016 are included in other assets on the condensed consolidated balance sheets and were comprised of:

	September 30, 2016							June 30, 2016
	Gross					Net		Gross					Net
	Carrying		Accumulated			Carrying		Carrying		Accumulated			Carrying
Identifiable intangible assets	Amount		Amortization			Amount		Amount		Amortization			Amount
With determinable lives:
Customer relationships	$	59,218	$	(17,374	)	$	41,844	$	59,218	$	(14,933	)	$	44,285
Contract backlog	900		(750		)	150		900		(525		)	375
Technology	1,000		(167		)	833		1,000		(117		)	883
	61,118		(18,291		)	42,827		61,118		(15,575		)	45,543
With indefinite lives:
Engineering licenses	426		—			426		426		—			426
	$	61,544	$	(18,291	)	$	43,253	$	61,544	$	(15,575	)	$	45,969

Schedule of expected amortization expense

Estimated amortization expense of intangible assets for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

Fiscal Year		Amount
2017		$	7,443
2018		9,183
2019		8,367
2020		7,821
2021		7,274
2022 and Thereafter		2,739
	Total	$	42,827

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Long-Term Debt and Capital Lease Obligations (Tables)

3 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Schedule of long-term debt

As of September 30, 2016, the Term Loan consisted of the following:

Current portion of Term Loan	$	5,625
Long-term portion of Term Loan	$	65,156
Less: Debt issuance costs	(1,074		)
Net long-term carrying amount	$	64,082

Schedule of maturities of long-term debt

The principal amounts due under the Company’s remaining CoCo debt obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:

2017		$	5,974
2018		5,734
2019		3,717
2020		3,980
2021		1,388
	Total	$	20,793

The scheduled principal amounts due under the Company’s Term Loan obligations as of September 30, 2016 for the remainder of fiscal year 2017 and succeeding fiscal years are as follows:

2017		$	4,219
2018		5,625
2019		5,625
2020		5,625
2021		49,687
	Total	$	70,781

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Operating Segments (Tables)

3 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The following tables present summarized financial information for the Company's operating segments (for the periods noted below): 

	Power		Environmental		Infrastructure		Oil & Gas		Total
Three months ended Sept. 30, 2016:
Gross revenue	$	56,995	$	73,936	$	22,913	$	26,638	$	180,482
Net service revenue	37,100		48,894		16,630		21,338		123,962
Segment profit	7,967		9,052		4,309		1,371		22,699
Depreciation	444		645		138		352		1,579
Amortization	248		274		—		2,067		2,589
Three months ended Sept. 25, 2015:
Gross revenue	$	39,237	$	75,843	$	19,970	$	—	$	135,050
Net service revenue	34,338		51,564		13,562		—		99,464
Segment profit	7,312		9,982		2,893		—		20,187
Depreciation	465		624		97		—		1,186
Amortization	300		365		—		—		665

	Three Months Ended
Gross revenue	September 30, 2016			September 25, 2015
Gross revenue from reportable operating segments	$	180,482		$	135,050
Reconciling items (1)	369			409
Total consolidated gross revenue	$	180,851		$	135,459
Net service revenue
Net service revenue from reportable operating segments	$	123,962		$	99,464
Reconciling items (1)	343			699
Total consolidated net service revenue	$	124,305		$	100,163
Income from operations before taxes
Segment profit from reportable operating segments	$	22,699		$	20,187
Corporate shared services (2)	(14,949		)	(9,954		)
Stock-based compensation expense	(1,457		)	(1,269		)
Unallocated acquisition and integration expenses	—			(878		)
Unallocated depreciation and amortization	(336		)	(413		)
Interest income	278			—
Interest expense	(845		)	(28		)
Total consolidated (loss) income from operations before taxes	$	5,390		$	7,645
Acquisition and integration expenses
Acquisition and integration expenses from reportable operating segments	$	—		$	—
Unallocated acquisition and integration expenses	—			878
Total consolidated acquisition and integration expenses	$	—		$	878
Depreciation and amortization
Depreciation and amortization from reportable operating segments	$	4,168		$	1,851
Unallocated depreciation and amortization	336			413
Total consolidated depreciation and amortization	$	4,504		$	2,264

(1) Amounts represent certain unallocated corporate amounts not considered in the CODM's evaluation of operating segment performance.

(2) Corporate shared services consist of centrally managed functions in the following areas: accounting, treasury, information technology, legal, human resources, marketing, internal audit and executive management such as the CEO and various executives. These costs and other items of a general corporate nature are not allocated to the Company’s four operating segments.

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New Accounting Pronouncements (Details) shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2016 USD ($) shares
Accounting Policies [Abstract]
Tax deficiency | $	$ 6
Increase in diluted weighted average common shares outstanding (in shares) (less than) | shares	24

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Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	$ 9,677	$ 9,868
Financial and Nonfinancial Liabilities, Fair Value Disclosure	90	233
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	8,466	8,556
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	1,211	1,312
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Financial and Nonfinancial Liabilities, Fair Value Disclosure	90	233
Mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	72	71
Mutual funds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	72	71
Mutual funds | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Mutual funds | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	106	107
Certificates of deposit | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Certificates of deposit | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	106	107
Certificates of deposit | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Municipal bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	543	547
Municipal bonds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Municipal bonds | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	543	547
Municipal bonds | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	344	439
Corporate bonds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Corporate bonds | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	344	439
Corporate bonds | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
U.S. Government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	218	219
U.S. Government bonds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
U.S. Government bonds | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	218	219
U.S. Government bonds | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
U.S. Treasury Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	1,995	2,009
U.S. Treasury Notes | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	1,995	2,009
U.S. Treasury Notes | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
U.S. Treasury Notes | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Money market accounts and cash deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	6,399	6,476
Money market accounts and cash deposits | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	6,399	6,476
Money market accounts and cash deposits | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Money market accounts and cash deposits | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Restricted Investments, at Fair Value	0	0
Contingent consideration
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	90	233
Contingent consideration | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0	0
Contingent consideration | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0	0
Contingent consideration | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	$ 90	$ 233

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Fair Value Measurements Roll Forward (Details) $ in Thousands	9 Months Ended
	Mar. 25, 2016 USD ($)
Contingent Consideration Liability [Roll Forward]
Contingent consideration balance at July 1, 2016	$ 233
Decrease of liability related to re-measurement of fair value	(143)
Contingent consideration balance at September 30, 2016	$ 90

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Stock-Based Compensation - Stock-Based Award Plans (Details)	3 Months Ended
	Sep. 30, 2016 stock_based_award_plan shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Types of Awards Available for Grant | stock_based_award_plan	2
Number Of Awards That Can Be Granted Annually	100,000
Grant period	12 months
Options Available For Future Grant	1,915,000
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards CEO Has Authority To Grant	10,000

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Stock-Based Compensation - Schedule of Employee Service-based Compensation, Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 1,457	$ 1,269
Cost of services
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	707	647
General and administrative expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 750	$ 622

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Stock-Based Compensation - Summary Of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding Options At Beginning Of Period (in shares)	85
Expiration of Stock Options (in shares)	(1)
Outstanding Options At End Of Period (in shares)	84
Options Exercisable	84
Options Vested And Expected To Vest	84
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding Options At Beginning Of Period, Weighted Average Exercise Price (in dollars per share)	$ 8.28
Expiration of Stock Options, Weighted Average Exercise Price (in dollars per share)	9.80
Outstanding Options At End Of Period, Weighted Average Exercise Price (in dollars per share)	8.26
Options Exercisable, Weighted Average Exercise Price (in dollars per share)	8.26
Options Vested And Expected To Vest, Weighted Average Exercise Price (in dollars per share)	$ 8.26
Options Outstanding, Weighted Average Remaining Contractual Term	6 months
Options Exercisable, Weighted Average Remaining Contractual Term	6 months
Options Vested and Expected to Vest, Weighted Average Remaining Contractual Term	6 months
Outstanding Options, Aggregate Intrinsic Value	$ 61
Options Exercisable, Aggregate Intrinsic Value	61
Options Vested And Expected To Vest, Aggregate Intrinsic Value	$ 61
Share Price (in dollars per share)	$ 8.67
Total intrinsic value of options exercised	$ 0	$ 87
Proceeds received from options exercised	$ 0	$ 31

XML

Stock-Based Compensation - Summary of Non Vested Restricted Stock Awards/Units (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Restricted Stock Award
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Awards granted	0
Non-vested awards, end of period	1,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Vesting Period	4 years
Total unrecognized compensation expense related to unvested awards	$ 1
Weighted average period of recognition on unvested options	2 months
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested awards, beginning of period	904,000
Awards granted	517,000	13,000
Awards vested	(132,000)
Awards forfeited	(23,000)
Non-vested awards, end of period	1,266,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested awards, Weighted Average Grate Date Fair Value, Beginning Of Period (in dollars per share)	$ 8.24
Awards Granted, Weighted Average Grant Date Fair Value (in dollars per share)	6.17
Awards vested, Weighted Average Grant Date Fair Value (in dollars per share)	7.85
Awards forfeited, Weighted Average Grant Date Fair Value (in dollars per share)	10.71
Non-vested awards, Weighted Average Grate Date Fair Value, End Of Period (in dollars per share)	$ 7.34
Vesting Period	4 years
Total unrecognized compensation expense related to unvested awards	$ 7,862
Weighted average period of recognition on unvested options	3 years 2 months
Weighted average grant date fair value	$ 3,188
Awards Granted, Fair Value At Grant Date		$ 150
Total Fair Value Of Units Vesting During Period	$ 966	2,781
Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Awards granted	512,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Non-vested awards, Weighted Average Grate Date Fair Value, Beginning Of Period (in dollars per share)	$ 8.74
Awards Granted, Weighted Average Grant Date Fair Value (in dollars per share)	6.15
Awards vested, Weighted Average Grant Date Fair Value (in dollars per share)	7.72
Awards forfeited, Weighted Average Grant Date Fair Value (in dollars per share)	8.24
Non-vested awards, Weighted Average Grate Date Fair Value, End Of Period (in dollars per share)	$ 7.79
Vesting Period	4 years
Total unrecognized compensation expense related to unvested awards	$ 7,452
Weighted average period of recognition on unvested options	2 years 9 months
Weighted average grant date fair value	$ 3,152
Total Fair Value Of Units Vesting During Period	$ 1,095	$ 2,191
Minimum | Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Percentage Of Payout Earned Based On Predefined Targets	0.00%
Maximum | Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Percentage Of Payout Earned Based On Predefined Targets	150.00%
Previously Reported | Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested awards, beginning of period	895,000
Awards granted	512,000
Awards vested	(142,000)
Awards forfeited	(40,000)
Non-vested awards, end of period	1,225,000
Adjustment
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Awards granted	0
Awards vested	0
Actual | Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Non-vested awards, beginning of period	895,000
Awards granted	512,000
Awards vested	(142,000)
Awards forfeited	(40,000)
Non-vested awards, end of period	1,225,000

XML

Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Earnings Per Share [Abstract]
Net income applicable to TRC Companies, Inc.	$ 3,639	$ 4,492
Basic (shares)	31,149	30,635
Effect of dilutive stock options, RSA's, RSU's and PSU's (in shares)	452	683
Diluted weighted-average common shares outstanding (in shares)	31,601	31,318
Basic earnings per common share (in dollars per share)	$ 0.12	$ 0.15
Diluted earnings per common share (in dollars per share)	$ 0.12	$ 0.14
Anti-dilutive stock options, RSA's, RSU's and PSU's, excluded from the calculation (in dollars per share)	1,611	821

XML

Accounts Receivable - Current Portion of Accounts Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Accounts Receivable, Net, Current [Abstract]
Total accounts receivable - gross	$ 176,850	$ 157,577
Less allowance for doubtful accounts	(8,384)	(8,297)
Total accounts receivable, less allowance for doubtful accounts	168,466	149,280
Billed
Accounts Receivable, Net, Current [Abstract]
Total accounts receivable - gross	101,430	90,194
Unbilled
Accounts Receivable, Net, Current [Abstract]
Total accounts receivable - gross	72,370	64,954
Retainage
Accounts Receivable, Net, Current [Abstract]
Total accounts receivable - gross	$ 3,050	$ 2,429

XML

Other Accrued Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Accounts Payable and Accrued Liabilities, Current [Abstract]
Contract costs	$ 40,134	$ 40,343
Legal accruals	5,325	5,232
Lease obligations	5,439	5,564
Other	6,643	6,887
Total other accrued liabilities	$ 57,541	$ 58,026

XML

Business Acquisitions, Goodwill and Other Intangible Assets - Narrative (Details) - USD ($)		3 Months Ended
	Nov. 30, 2015	Sep. 30, 2016	Sep. 25, 2015	Jun. 30, 2016	Mar. 31, 2016
Business Acquisition [Line Items]
Goodwill		$ 75,337,000		$ 75,337,000
Amortization period of identifiable intangible assets		7 years
Gross revenue		$ 180,851,000	$ 135,459,000
Net service revenue		124,305,000	100,163,000
Amortization of Intangible Assets		$ 2,716,000	$ 840,000
Oil and Gas
Business Acquisition [Line Items]
Goodwill	$ 60,294,000
Purchase price	124,498,000
Cash paid	119,955,000
Cash and cash equivalents	355,000
Second cash payment	7,500,000
Business Combination, Net Working Capital Adjustment	2,957,000				$ 2,354,000
Total identifiable intangible assets	44,500,000
Customer relationships and backlog | Oil and Gas
Business Acquisition [Line Items]
Total identifiable intangible assets	43,500,000
Internally developed software | Oil and Gas
Business Acquisition [Line Items]
Intangible asset, useful life		5 years
Amortization period of identifiable intangible assets		5 years
Total identifiable intangible assets	$ 1,000,000
Customer relationships
Business Acquisition [Line Items]
Amortization period of identifiable intangible assets		7 years
Customer relationships | Oil and Gas
Business Acquisition [Line Items]
Amortization period of identifiable intangible assets		6 years
Minimum | Contract backlog | Oil and Gas
Business Acquisition [Line Items]
Intangible asset, useful life		1 year
Minimum | Customer relationships | Oil and Gas
Business Acquisition [Line Items]
Intangible asset, useful life		15 years
Maximum | Customer relationships | Oil and Gas
Business Acquisition [Line Items]
Intangible asset, useful life		12 years
Oil and Gas
Business Acquisition [Line Items]
Goodwill		$ 38,313,000		$ 38,313,000

XML

Business Acquisitions, Goodwill and Other Intangible Assets - Net Assets Acquired (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Nov. 30, 2015
Identifiable intangible assets:
Goodwill	$ 75,337	$ 75,337
Oil and Gas
Business Acquisition [Line Items]
Business Combination, Net Working Capital Adjustment			$ 2,354	$ 2,957
Cash and cash equivalents				355
Accounts receivable				28,263
Prepaid expenses and other current assets				7,228
Property and equipment				3,552
Identifiable intangible assets:
Total identifiable intangible assets				44,500
Goodwill				60,294
Other non-current assets				20,683
Accounts payable				(2,544)
Accrued compensation and benefits				(7,201)
Other accrued liabilities				(5,110)
Current portion of long-term debt				(6,485)
Long-term debt, net of current portion				(18,547)
Non-controlling interest				(490)
Net assets acquired				124,498
Oil and Gas | Customer relationships and backlog
Identifiable intangible assets:
Total identifiable intangible assets				43,500
Oil and Gas | Internally developed software
Identifiable intangible assets:
Total identifiable intangible assets				1,000
Previously Reported | Oil and Gas
Business Acquisition [Line Items]
Cash and cash equivalents				355
Accounts receivable				26,406
Prepaid expenses and other current assets				7,276
Property and equipment				3,552
Identifiable intangible assets:
Total identifiable intangible assets				44,500
Goodwill				64,673
Other non-current assets				20,683
Accounts payable				(2,587)
Accrued compensation and benefits				(7,199)
Other accrued liabilities				(5,210)
Current portion of long-term debt				(6,447)
Long-term debt, net of current portion				(18,547)
Non-controlling interest				0
Net assets acquired				127,455
Previously Reported | Oil and Gas | Customer relationships and backlog
Identifiable intangible assets:
Total identifiable intangible assets				43,500
Previously Reported | Oil and Gas | Internally developed software
Identifiable intangible assets:
Total identifiable intangible assets				1,000
Adjustment | Oil and Gas
Business Acquisition [Line Items]
Cash and cash equivalents				0
Accounts receivable				(1,857)
Prepaid expenses and other current assets				48
Property and equipment				0
Identifiable intangible assets:
Total identifiable intangible assets				0
Goodwill				4,379
Other non-current assets				0
Accounts payable				(43)
Accrued compensation and benefits				2
Other accrued liabilities				(100)
Current portion of long-term debt				38
Long-term debt, net of current portion				0
Non-controlling interest				490
Net assets acquired				(2,957)
Adjustment | Oil and Gas | Customer relationships and backlog
Identifiable intangible assets:
Total identifiable intangible assets				0
Adjustment | Oil and Gas | Internally developed software
Identifiable intangible assets:
Total identifiable intangible assets				$ 0

XML

Business Acquisitions, Goodwill and Other Intangible Assets - Pro Forma Information (Details) - Oil and Gas $ / shares in Units, $ in Thousands	3 Months Ended
	Sep. 25, 2015 USD ($) $ / shares
Business Acquisition [Line Items]
Gross revenue	$ 184,033
Net service revenue	131,709
Net income applicable to TRC Companies, Inc.	$ 2,986
Basic earnings per common share (in dollars per share) | $ / shares	$ 0.10
Diluted earnings per common share (in dollars per share) | $ / shares	$ 0.10

XML

Business Acquisitions, Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 30, 2016
Goodwill [Roll Forward]
Gross Goodwill, Beginning of Period	$ 136,913
Goodwill, Impaired, Accumulated Impairment Loss, Beginning of Period	(61,576)
Goodwill, Beginning of Period	75,337
Goodwill, Period Increase (Decrease)	0
Gross Goodwill, End of Period	136,913
Goodwill, Impaired, Accumulated Impairment Loss, End of Period	(61,576)
Goodwill	75,337	$ 75,337
Power
Goodwill [Roll Forward]
Gross Goodwill, Beginning of Period	28,506
Goodwill, Impaired, Accumulated Impairment Loss, Beginning of Period	(14,506)
Goodwill, Beginning of Period	14,000
Goodwill, Period Increase (Decrease)	0
Gross Goodwill, End of Period	28,506
Goodwill, Impaired, Accumulated Impairment Loss, End of Period	(14,506)
Goodwill	14,000	14,000
Environmental
Goodwill [Roll Forward]
Gross Goodwill, Beginning of Period	40,889
Goodwill, Impaired, Accumulated Impairment Loss, Beginning of Period	(17,865)
Goodwill, Beginning of Period	23,024
Goodwill, Period Increase (Decrease)	0
Gross Goodwill, End of Period	40,889
Goodwill, Impaired, Accumulated Impairment Loss, End of Period	(17,865)
Goodwill	23,024	23,024
Infrastructure
Goodwill [Roll Forward]
Gross Goodwill, Beginning of Period	7,224
Goodwill, Impaired, Accumulated Impairment Loss, Beginning of Period	(7,224)
Goodwill, Beginning of Period	0
Goodwill, Period Increase (Decrease)	0
Gross Goodwill, End of Period	7,224
Goodwill, Impaired, Accumulated Impairment Loss, End of Period	(7,224)
Goodwill	0	0
Oil and Gas
Goodwill [Roll Forward]
Gross Goodwill, Beginning of Period	60,294
Goodwill, Impaired, Accumulated Impairment Loss, Beginning of Period	(21,981)
Goodwill, Beginning of Period	38,313
Goodwill, Period Increase (Decrease)	0
Gross Goodwill, End of Period	60,294
Goodwill, Impaired, Accumulated Impairment Loss, End of Period	(21,981)
Goodwill	$ 38,313	$ 38,313

XML

Business Acquisitions, Goodwill and Other Intangible Assets - Identifiable Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Finite-lived Intangible Assets
Finite-Lived Intangible Assets, Gross	$ 61,118	$ 61,118
Accumulated Amortization of Identifiable Intangible Assets	(18,291)	(15,575)
Finite-Lived Intangible Assets, Net	42,827	45,543
Indefinite-lived Intangible Assets
Indefinite-Lived Intangible Assets (Excluding Goodwill)	61,544	61,544
Intangible Assets Net Excluding Goodwill Accumulated Amortization	(18,291)	(15,575)
Intangible Assets, Net (Excluding Goodwill)	43,253	45,969
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2017	7,443
2018	9,183
2019	8,367
2020	7,821
2021	7,274
2022 and thereafter	2,739
Engineering licenses
Indefinite-lived Intangible Assets
Indefinite-Lived Intangible Assets (Excluding Goodwill)	426	426
Customer relationships
Finite-lived Intangible Assets
Finite-Lived Intangible Assets, Gross	59,218	59,218
Accumulated Amortization of Identifiable Intangible Assets	(17,374)	(14,933)
Finite-Lived Intangible Assets, Net	41,844	44,285
Contract backlog
Finite-lived Intangible Assets
Finite-Lived Intangible Assets, Gross	900	900
Accumulated Amortization of Identifiable Intangible Assets	(750)	(525)
Finite-Lived Intangible Assets, Net	150	375
Technology
Finite-lived Intangible Assets
Finite-Lived Intangible Assets, Gross	1,000	1,000
Accumulated Amortization of Identifiable Intangible Assets	(167)	(117)
Finite-Lived Intangible Assets, Net	$ 833	$ 883

XML

Long-Term Debt and Capital Lease Obligations (Details)		3 Months Ended
	Nov. 30, 2015 USD ($) lender	Sep. 30, 2016 USD ($)	Jul. 01, 2016 USD ($) Payments	Jun. 30, 2016 USD ($)	Mar. 31, 2016 USD ($)
Debt Instrument [Line Items]
Current portion of long-term debt		$ 15,497,000		$ 18,339,000
Other assets		16,575,000		$ 18,383,000
New Credit Agreement
Debt Instrument [Line Items]
Debt term	5 years
Maximum borrowing capacity	$ 175,000,000
Additional number of lenders | lender	5
Debt instrument, additional borrowing amount	$ 75,000,000
CoCo Debt
Debt Instrument [Line Items]
Long-term Debt		20,793,000
Current portion of long-term debt		7,656,000
Other assets		20,793,000
Other assets, current		7,656,000
Subordinated Debt | Other note payable
Debt Instrument [Line Items]
Long-term Debt			$ 3,838,000
Number of installment payments | Payments			7
Debt instrument, periodic payment		552,000
Stated finance charge rate			2.19%
Minimum | New Credit Agreement
Debt Instrument [Line Items]
Fixed charge coverage ratio	1.25
Line Of Credit Facility, Dividend Restrictions Threshold	$ 10,000,000
Unused borrowing capacity, fee	0.20%
Maximum | New Credit Agreement
Debt Instrument [Line Items]
Line of Credit Facility, Leverage Ratio	3.00
Unused borrowing capacity, fee	0.375%
Credit Agreement Two | Subordinated Debt | Other note payable
Debt Instrument [Line Items]
Long-term Debt		2,199,000
Letters of Credit | New Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 15,000,000
Letters of Credit | Minimum | New Credit Agreement
Debt Instrument [Line Items]
Debt issuance costs, fee	1.50%
Letters of Credit | Maximum | New Credit Agreement
Debt Instrument [Line Items]
Debt issuance costs, fee	2.25%
Revolving Credit Facility | New Credit Agreement
Debt Instrument [Line Items]
Debt term	5 years
Maximum borrowing capacity	$ 100,000,000
Term Loan | New Credit Agreement
Debt Instrument [Line Items]
Debt term	5 years
Debt instrument, amount	$ 75,000,000
Debt Instrument, Percent Of Outstanding Amount, Payable Quarterly	1.875%
Debt instrument, covenant compliance, conditional term rate one	50.00%
Debt instrument, covenant compliance, conditional term rate two	0.00%
Debt instrument, covenant compliance, conditional term rate based on net cash proceeds from asset sales subject to certain reinvestment rights	100.00%
Debt instrument, covenant compliance, conditional term rate based on net cash proceeds from issuance of debt other than debt permitted under credit facility	100.00%
Debt instrument, covenant compliance, conditional term rate based on net cash proceeds from events of loss subject to certain reinvestments rights	100.00%
Long-term Debt		70,781,000
Current portion of long-term debt		5,625,000
Base Rate | Minimum | New Credit Agreement
Debt Instrument [Line Items]
Variable rate of debt	0.50%
Base Rate | Maximum | New Credit Agreement
Debt Instrument [Line Items]
Variable rate of debt	1.25%
LIBOR | Minimum | New Credit Agreement
Debt Instrument [Line Items]
Variable rate of debt	1.50%
LIBOR | Maximum | New Credit Agreement
Debt Instrument [Line Items]
Variable rate of debt	2.25%
Oil and Gas
Debt Instrument [Line Items]
Second cash payment	$ 7,500,000
Business Combination, Net Working Capital Adjustment	2,957,000				$ 2,354,000
Oil and Gas | New Credit Agreement
Debt Instrument [Line Items]
Letters of credit, remaining borrowing capacity		97,346,000
Borrowings	102,000,000	$ 70,781,000
Oil and Gas | Revolving Credit Facility | New Credit Agreement
Debt Instrument [Line Items]
Borrowings	27,000,000
Debt instrument, fee amount	1,916,000
Oil and Gas | Term Loan | New Credit Agreement
Debt Instrument [Line Items]
Debt instrument, stated interest rate		2.0244%
Borrowings	75,000,000
Debt instrument, effective rate		2.07%
Debt instrument, fee amount	$ 1,332,000

XML

Long-Term Debt and Capital Lease Obligation - Long Term Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016
Debt Instrument [Line Items]
Current portion of long-term debt	$ 15,497	$ 18,339
Long-term debt, net of current portion	77,253	$ 79,243
New Credit Agreement | Term Loan
Debt Instrument [Line Items]
Current portion of long-term debt	5,625
Long-term debt, net of current portion	65,156
Less: Debt issuance costs	(1,074)
Net long-term carrying amount	$ 64,082

XML

Long-Term Debt and Capital Lease Obligations - Debt Maturities (Details) $ in Thousands	Sep. 30, 2016 USD ($)
CoCo Debt
Debt Instrument [Line Items]
2017	$ 5,974
2018	5,734
2019	3,717
2020	3,980
2021	1,388
Total	20,793
Term Loan | New Credit Agreement
Debt Instrument [Line Items]
2017	4,219
2018	5,625
2019	5,625
2020	5,625
2021	49,687
Total	$ 70,781

XML

Variable Interest Entity (Details) - WBA [Member] - Variable Interest Entity, Primary Beneficiary $ in Thousands	3 Months Ended
	Sep. 30, 2016 USD ($)
Variable Interest Entity [Line Items]
Variable interest entity, cash and cash equivalents	$ 362
Variable interest entity, accounts receivable	262
Variable interest entity, other current liabilities	3
Variable interest entity, financial support given	$ 7

XML

Income Taxes - Federal and State Income Tax (Provision) Benefit (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Income Tax Disclosure [Abstract]
Effective tax rate	32.10%	41.30%
Federal statutory rate	35.00%	35.00%
Recorded liability for uncertain tax positions	$ 903
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities	1,344
Current Income Tax Expense (Benefit)	(294)
Tax deficiency	$ 6

XML

Operating Segments - Segment Summary (Details) $ in Thousands	3 Months Ended
	Sep. 30, 2016 USD ($) segment	Sep. 25, 2015 USD ($)
Segment Reporting Information [Line Items]
Number of operating segments (in segments) | segment	4
Gross revenue	$ 180,851	$ 135,459
Net service revenue	124,305	100,163
Segment profit (loss)	5,957	7,673
Total [Member]
Segment Reporting Information [Line Items]
Gross revenue	180,482	135,050
Net service revenue	123,962	99,464
Segment profit (loss)	22,699	20,187
Depreciation	1,579	1,186
Amortization	2,589	665
Energy
Segment Reporting Information [Line Items]
Gross revenue	56,995	39,237
Net service revenue	37,100	34,338
Segment profit (loss)	7,967	7,312
Depreciation	444	465
Amortization	248	300
Environmental
Segment Reporting Information [Line Items]
Gross revenue	73,936	75,843
Net service revenue	48,894	51,564
Segment profit (loss)	9,052	9,982
Depreciation	645	624
Amortization	274	365
Infrastructure
Segment Reporting Information [Line Items]
Gross revenue	22,913	19,970
Net service revenue	16,630	13,562
Segment profit (loss)	4,309	2,893
Depreciation	138	97
Amortization	0	0
Oil & Gas
Segment Reporting Information [Line Items]
Gross revenue	26,638	0
Net service revenue	21,338	0
Segment profit (loss)	1,371	0
Depreciation	352	0
Amortization	$ 2,067	$ 0

XML

Operating Segments - Segment Detail (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 25, 2015
Segment Reporting Information [Line Items]
Gross revenue	$ 180,851	$ 135,459
Net service revenue	124,305	100,163
Segment profit from reportable operating segments	5,957	7,673
Corporate shared services	(14,949)	(9,954)
Stock-based compensation expense	(1,457)	(1,269)
Business Combination, Separately Recognized Transactions, Additional Disclosures, Acquisition Cost Expensed	0	(878)
Depreciation and amortization	(4,504)	(2,264)
Interest income	278	0
Interest expense	(845)	(28)
Income from operations before taxes	5,390	7,645
Acquisition and integration expenses	0	(878)
Operating Segments
Segment Reporting Information [Line Items]
Gross revenue	180,482	135,050
Net service revenue	123,962	99,464
Segment profit from reportable operating segments	22,699	20,187
Business Combination, Separately Recognized Transactions, Additional Disclosures, Acquisition Cost Expensed	0	0
Depreciation and amortization	(4,168)	(1,851)
Reconciling Items
Segment Reporting Information [Line Items]
Gross revenue	369	409
Net service revenue	343	699
Depreciation and amortization	$ (336)	$ (413)

XML

Commitments and Contingencies (Details) - USD ($)	3 Months Ended
	Sep. 30, 2016	Jun. 30, 2016
Loss Contingencies [Line Items]
Accrued litigation-related liabilities	$ 4,627,000	$ 4,869,000
Insurance recovery receivables related to litigation related reserves	2,254,000	$ 2,661,000
Amount of potential litigation related liabilities covered by insurance	2,100,000
Environmental Restoration Costs
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	25,000,000
Amount of potential litigation related liabilities covered by insurance	4,000,000
Minimum | Environmental Restoration Costs
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 0
Loss Contingency, Expected Payment Period	1 year
Maximum
Loss Contingencies [Line Items]
Possible increase in potential litigation related liabilities	$ 11,300,000
Maximum | Environmental Restoration Costs
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 18,600,000
Loss Contingency, Expected Payment Period	5 years
TRC vs LVI Group Services Inc | Pending Litigation | Favorable Regulatory Action
Loss Contingencies [Line Items]
Gain Contingency, Unrecorded Amount	$ 3,000,000
TRC vs LVI Group Services Inc | Pending Litigation | Unfavorable Regulatory Action
Loss Contingencies [Line Items]
Loss Contingency, Damages Sought, Value	$ 9,900,000