Segment Information

9 Months Ended

Jun. 26, 2020

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company's two operating segments and global lines of business ("LOBs") are as follows: Critical Mission Solutions ("CMS") and People & Places Solutions ("P&PS"), with the previous Energy, Chemicals and Resources ("ECR") LOB reported as discontinued operations. For further information on ECR, refer to Note 7- Sale of Energy, Chemicals and Resources ("ECR") Business.

The Company’s Chair and Chief Executive Officer is the Chief Operating Decision Maker (“CODM”) and can evaluate the performance of each of these segments and make appropriate resource allocations among each of the segments. For purposes of the Company’s goodwill impairment testing, it has been determined that the Company’s operating segments are also its reporting units based on management’s conclusion that the components comprising each of its operating segments share similar economic characteristics and meet the aggregation criteria for reporting units in accordance with ASC 350, Intangibles-Goodwill and Other.

Under this organization, the sales function is managed by LOB, and accordingly, the associated cost is embedded in the segments and reported to the respective head of each LOB. In addition, a portion of the costs of other support functions (e.g., finance, legal, human resources, and information technology) is allocated to each LOB using methodologies which, we believe, effectively attribute the cost of these support functions to the revenue generating activities of the Company on a rational basis. The cost of the Company’s cash incentive plan, the Leadership Performance Plan ("LPP"), formerly named the Management Incentive Plan, and the expense associated with the Jacobs Engineering Group Inc. 1999 Stock Incentive Plan (“1999 SIP”) have likewise been charged to the LOBs except for those amounts determined to relate to the business as a whole (which amounts remain in other corporate expenses).

Financial information for each LOB is reviewed by the CODM to assess performance and make decisions regarding the allocation of resources. The Company generally does not track assets by LOB, nor does it provide such information to the CODM.

The CODM evaluates the operating performance of our LOBs using segment operating profit, which is defined as margin less “corporate charges” (e.g., the allocated amounts described above). The Company incurs certain Selling, General and Administrative costs (“SG&A”) that relate to its business as a whole which are not allocated to the LOBs.

The following tables present total revenues and segment operating profit from continuing operations for each reportable segment (in thousands) and includes a reconciliation of segment operating profit to total U.S. GAAP operating profit by including certain corporate-level expenses, Restructuring and other charges (as defined in Note 11 - Restructuring and Other Charges) and transaction and integration costs (in thousands).

	For the Three Months Ended				For the Nine Months Ended
	June 26, 2020		June 28, 2019		June 26, 2020		June 28, 2019
Revenues from External Customers:
Critical Mission Solutions	$	1,211,143	$	1,156,488	$	3,636,978	$	3,251,024
People & Places Solutions	2,048,914		2,013,134		6,410,308		6,093,981
Total	$	3,260,057	$	3,169,622	$	10,047,286	$	9,345,005

	For the Three Months Ended				For the Nine Months Ended
	June 26, 2020		June 28, 2019		June 26, 2020		June 28, 2019
Segment Operating Profit:
Critical Mission Solutions	$	89,608	$	76,306	$	264,323	$	222,289
People & Places Solutions	190,453		183,318		557,864		515,465
Total Segment Operating Profit	280,061		259,624		822,187		737,754
Other Corporate Expenses (1)	(65,213)		(64,525)		(193,148)		(185,674)
Restructuring, Transaction and Other Charges	(20,472)		(105,145)		(115,539)		(246,317)
Total U.S. GAAP Operating Profit	194,376		89,954		513,500		305,763
Total Other Income (Expense), net (2)	109,305		3,445		(132,453)		(8,344)
Earnings from Continuing Operations Before Taxes	$	303,681	$	93,399	$	381,047	$	297,419

(1)

Other corporate expenses include costs that were previously allocated to the ECR segment prior to discontinued operations presentation in connection with the ECR sale in the approximate amount of $2.0 million and $14.8 million for the three and nine month periods ended June 28, 2019, respectively. Other corporate expenses also include intangibles amortization of $23.1 million and $18.4 million for the three-month periods ended June 26, 2020 and June 28, 2019, respectively, and $67.1 million and $55.7 million for the nine months ended June 26, 2020 and June 28, 2019, respectively.

(2)

For the three and nine month periods ended June 26, 2020, includes revenues under the Company's TSA with Worley of $1.0 million and $15.2 million, respectively, $122.9 million and $(119.0) million in fair value adjustments related to our investment in Worley stock (net of Worley stock dividend) and certain foreign currency revaluations relating to the ECR sale, respectively, the amortization of deferred financing fees related to the acquisition of CH2M HILL Companies Ltd. ("CH2M") in December 2017 (the "CH2M acquisition") of $— million and $0.7 million, respectively, and the loss on settlement of the U.S. pension plan of $— million and $2.7 million respectively. For the three and nine month periods ended June 28, 2019, includes the amortization of deferred financing fees related to the CH2M acquisition of $0.5 million and $1.5 million, respectively, and the gain on settlement of the CH2M portion of the U.S. pension plan of $0.0 million and $34.6 million, respectively. Also includes revenues under the Company's TSA with Worley of $14.1 million for the three and nine month periods ended June 28, 2019, for which the related costs are included in SG&A.

(1)Included in “other corporate expenses” in the above table are costs and expenses which relate to general corporate activities as well as corporate-managed benefit and insurance programs. Such costs and expenses include: (i) those elements of SG&A expenses relating to the business as a whole; (ii) those elements of the LPP and the 1999 SIP relating to corporate personnel whose other compensation costs are not allocated to the LOBs; (iii) the amortization of intangible assets acquired as part of purchased business combinations; (iv) the quarterly variances between the Company’s actual costs of certain of its self-insured integrated risk and employee benefit programs and amounts charged to the LOBs; and (v) certain adjustments relating to costs associated with the Company’s international defined benefit pension plans. In addition, other corporate expenses may also include from time to time certain adjustments to contract margins (both positive and negative) associated with projects where it has been determined, in the opinion of management, that such adjustments are not indicative of the performance of the related LOB.

See also MD&A results of operations for our operating segments in Item 2- Management’s Discussion and Analysis of Financial Condition and Results of Operations.