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Acquisition of Citizen Engagement Centers Business (Tables)

9 Months Ended

Jun. 30, 2019

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

Our current estimate of the allocation of the purchase price, updated from March 31, 2019, is shown below.


(dollars in thousands)	Estimated purchase price allocation at March 31, 2019		Adjustments		Estimated purchase price allocation at June 30, 2019
Cash consideration	$	430,573	$	126	$	430,699

Billed and unbilled receivables	141,869		296		142,165
Property and equipment	6,454		2,520		8,974
Other assets	4,093		415		4,508
Intangible assets	122,300		—		122,300
Total identifiable assets acquired	274,716		3,231		277,947
Accounts payable and other liabilities	32,205		(343)		31,862
Net identifiable assets acquired	242,511		3,574		246,085
Goodwill	188,062		(3,448)		184,614
Net assets acquired	$	430,573	$	126	$	430,699

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

(dollars in thousands)

Useful life

Fair value

Customer relationships - all contracts except U.S. Census

10 years

85,300

Customer relationships - U.S. Census

2 years

37,000

Total intangible assets

122,300

Schedule of the contribution of acquired business

The contribution of the acquired business for the three and nine months ended June 30, 2019, is shown below. Given the integration of the acquired business into our cost structure, it is impracticable to calculate the effect of the acquisition on operating income.


	Acquisition Contribution for
(dollars in thousands)	Three Months Ended June 30, 2019		Nine Months Ended June 30, 2019
Revenue	$	163,381	$	440,647
Gross profit	31,943		83,563

Schedule of Business Acquisition, Pro Forma Information


	Pro forma results for the three months ended June 30,						Pro forma results for the nine months ended June 30,
(dollars in thousands, except per share amounts)	2019		2018		2019		2018
Revenue	$	730,710	$	731,755	$	2,230,278	$	2,324,478
Net income	62,965		56,886		183,927		176,877
Basic earnings per share attributable to MAXIMUS	0.98		0.86		2.85		2.68
Diluted earnings per share attributed to MAXIMUS	0.97		0.86		2.84		2.66

Schedule of Goodwill

Changes in goodwill for the nine months ended June 30, 2019, were as follows:


(dollars in thousands)	U.S. Health & Human Services		U.S. Federal Services		Outside the United States		Total
Balance as of September 30, 2018	$	139,588	$	228,148	$	32,146	$	399,882
Estimated effect of the acquisition of citizen engagement centers business	19,703		162,465		2,446		184,614
Foreign currency translation	—		—		(793)		(793)
Balance as of June 30, 2019	$	159,291	$	390,613	$	33,799	$	583,703

Schedule of Finite-Lived Intangible Assets

The following table sets forth the components of intangible assets:


	As of June 30, 2019										As of September 30, 2018
(dollars in thousands)	Cost		Accumulated Amortization		Intangible Assets, net		Cost		Accumulated Amortization		Intangible Assets, net
Customer contracts and relationships	$	248,324	$	63,684	$	184,640	$	129,113	$	42,683	$	86,430
Technology based intangible assets	5,680		4,385		1,295		5,750		4,212		1,538
Trademarks and trade names	4,489		4,459		30		4,496		4,429		67
Total	$	258,493	$	72,528	$	185,965	$	139,359	$	51,324	$	88,035

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The estimated future amortization expense for the remainder of the current fiscal year and the future fiscal years for the intangible assets held by the Company as of June 30, 2019, is as follows (in thousands):


Nine months ended September 30, 2019	$	8,984
2020	35,279
2021	18,230
2022	15,857
2023	15,760