Segment Information

9 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment Information

Segment Information

The table below provides certain financial information for each of our business segments. We operate our business through three segments.

•Our U.S. Health and Human Services Segment provides a variety of business process services such as program administration, appeals and assessments services, and related consulting work for U.S. state and local government programs. These services support a variety of programs including the Affordable Care Act (ACA), Medicaid and the Children’s Health Insurance Program (CHIP). We also serve as administrators in state-based welfare-to-work and child support programs.

•Our U.S. Federal Services Segment provides business process solutions, including program administration, appeals and assessment services, as well as system and software development and maintenance services for various U.S. federal civilian programs. This segment also contains certain state-based assessments, independent medical reviews, and appeals work that is part of the segment's heritage within the Medicare Appeals portfolio and continues to be managed within this segment.

•Our Outside the U.S. Segment provides business process solutions for governments and commercial clients outside the U.S., including health and disability assessments, program administration and case management for employment services and other work-support programs. We deliver services in the United Kingdom, including the Health Assessment Advisory Service (HAAS), the Work & Health Programme and Fair Start; Australia, including jobactive and the Disability Employment Service; Canada, including Health Insurance British Columbia and the Employment Program of British Columbia; Italy, Saudi Arabia, Singapore and Sweden.

	Three Months Ended June 30,						Nine Months Ended June 30,
(dollars in thousands)	2020		% (1)	2019		% (1)	2020		% (1)	2019		% (1)
Revenue:
U.S. Health & Human Services	$	336,950		$	291,132		$	957,929		$	876,082
U.S. Federal Services	450,143			292,295			1,210,105			799,018
Outside the U.S.	114,244			147,283			369,667			456,749
Total	$	901,337		$	730,710		$	2,537,701		$	2,131,849
Gross profit:
U.S. Health & Human Services	$	93,029	27.6%	$	86,664	29.8%	$	268,073	28.0%	$	260,955	29.8%
U.S. Federal Services	84,723		18.8%	66,803		22.9%	232,502		19.2%	175,484		22.0%
Outside the U.S.	7,851		6.9%	20,780		14.1%	13,576		3.7%	66,495		14.6%
Total	$	185,603	20.6%	$	174,247	23.8%	$	514,151	20.3%	$	502,934	23.6%
Selling, general & administrative expense:
U.S. Health & Human Services	$	31,996	9.5%	$	32,414	11.1%	$	102,633	10.7%	$	93,953	10.7%
U.S. Federal Services	45,490		10.1%	32,896		11.3%	131,455		10.9%	90,632		11.3%
Outside the U.S.	13,668		12.0%	15,791		10.7%	47,125		12.7%	52,591		11.5%
Gain on sale of a business (3)	(1,706)		NM	—		NM	(1,706)		NM	—		NM
Other (2)	134		NM	503		NM	4,155		NM	2,201		NM
Total	$	89,582	9.9%	$	81,604	11.2%	$	283,662	11.2%	$	239,377	11.2%
Operating income:
U.S. Health & Human Services	$	61,033	18.1%	$	54,250	18.6%	$	165,440	17.3%	$	167,002	19.1%
U.S. Federal Services	39,233		8.7%	33,907		11.6%	101,047		8.4%	84,852		10.6%
Outside the U.S.	(5,817)		(5.1)%	4,989		3.4%	(33,549)		(9.1)%	13,904		3.0%
Amortization of intangible assets	(8,712)		NM	(9,049)		NM	(26,734)		NM	(24,026)		NM
Gain on sale of a business (3)	1,706		NM	—		NM	1,706		NM	—		NM
Other	(134)		NM	(503)		NM	(4,155)		NM	(2,201)		NM
Total	$	87,309	9.7%	$	83,594	11.4%	$	203,755	8.0%	$	239,531	11.2%

(1) Percentage of respective segment revenue. Percentages not considered meaningful are marked “NM.”

(2) Other selling, general and administrative expenses includes credits and costs that are not allocated to a particular segment, including the costs for actual and potential acquisitions of other businesses.

(3) During fiscal year 2020, we sold Q2 Administrators LLC, a subsidiary within our U.S. Federal Services Segment, resulting in a gain. Refer to "Note 6. Acquisitions and Divestiture" for more details.

Identifiable assets for the segments are shown below (in thousands):

	June 30, 2020		September 30, 2019
U.S. Health & Human Services	$	701,864	$	500,641
U.S. Federal Services	992,207		795,553
Outside the U.S.	200,752		234,769
Corporate	168,163		214,769
Total	$	2,062,986	$	1,745,732