Reportable Segments

12 Months Ended

Sep. 30, 2012

Reportable Segments

Reportable Segments

17.   Reportable Segments

        In the first quarter of fiscal 2012, we implemented organizational changes that resulted in a realignment of certain operating activities in our reportable segments. This realignment resulted from the organic growth of new activities in a component of an existing reportable segment due to changing business conditions. These activities are not regularly reviewed by our Chief Operating Decision Maker to assess performance or make decisions about the resources to be allocated to them and do not individually meet the definition of a reportable segment. The changes were intended to improve organizational effectiveness and efficiency by better aligning operations with similar characteristics such as client types, project types, required resources and financial metrics. Prior year amounts have been reclassified to conform to the current year presentation.

        In the fourth quarter of fiscal 2012, we initiated the execution of the reorganization of our operations to improve future growth and profitability. These activities included the consolidation and realignment of certain operating activities to improve organizational effectiveness and achieve efficiencies in our segment management. We also decided to exit certain unprofitable business activities. Specifically, this reorganization included the elimination of the EAS reportable segment effective at the beginning of fiscal 2013. Operating activities previously reported in this segment have been realigned with operations with similar client types, project types and financial metrics in the ECS and TSS segments. Segment results on a prospective basis will be revised consistent with the new organization structure. Prior period amounts will be restated to conform to the new presentation beginning in fiscal 2013.

        Our reportable segments were as follows for fiscal 2012:

        Engineering and Consulting Services.    ECS provides front-end science, consulting engineering services and project management in the areas of surface water management, solid waste management, mining, geotechnical sciences, arctic engineering, industrial process and oil sands, and information technology.

        Technical Support Services.    TSS advises clients through the study, design and implementation phases of projects. TSS provides management consulting services and strategic direction in the areas of environmental assessments/hazardous waste management; climate change; international development; international reconstruction and stabilization; energy; oil and gas; and technical government consulting.

        Engineering and Architecture Services.    EAS provides engineering and architecture design services, together with technical and program administration services for projects related to water infrastructure, transportation, and buildings and facilities. Beginning in fiscal 2013, the EAS operations were re-assigned to the ECS and TSS business segments. The water and transportation infrastructure services were aligned with related services in ECS, and the buildings and facilities activities were aligned with complementary energy efficiency and international development services in TSS.

        Remediation and Construction Management.    RCM provides full-service support to all of our client sectors including the U.S. federal government, in the U.S. and internationally, and commercial clients worldwide. We provide construction and construction management services in the areas of environmental remediation, infrastructure development, energy, and oil and gas.

        Management evaluates the performance of these reportable segments based upon their respective segment operating income before the effect of amortization expense related to acquisitions and other unallocated corporate expenses. We account for inter-segment sales and transfers as if the sales and transfers were to third parties; that is, by applying a negotiated fee onto the costs of the services performed. All significant intercompany balances and transactions are eliminated in consolidation.

        The following tables set forth summarized financial information concerning our reportable segments:

Reportable Segments

	Fiscal Year Ended
	September 30, 2012			October 2, 2011			October 3, 2010
	(in thousands)
Revenue
ECS	$	1,036,588		$	930,067		$	536,384
TSS		919,862			867,130			829,231
EAS		318,755			308,112			294,112
RCM		621,957			604,651			651,595
Elimination of inter-segment revenue		(186,087	)		(136,816	)		(110,090	)
Total revenue	$	2,711,075		$	2,573,144		$	2,201,232
Operating Income
ECS	$	88,091		$	88,135		$	48,582
TSS		67,411			59,113			54,822
EAS		12,485			22,597			12,194
RCM		22,374			13,183			30,243
Corporate(1)		(23,994	)		(36,606	)		(21,367	)
Total operating income	$	166,367		$	146,422		$	124,474
Depreciation
ECS	$	8,887		$	10,786		$	5,503
TSS		2,801			2,822			2,199
EAS		1,665			1,814			2,100
RCM		10,233			8,775			7,850
Corporate		3,065			2,941			2,750
Total depreciation	$	26,651		$	27,138		$	20,402

⁽¹⁾

Corporate includes amortization of intangibles, other costs and other income not allocable to segments. Amortization expense for fiscal 2012, 2011 and 2010 was $29.6 million, $28.0 million and $12.7 million, respectively. Corporate results also included income for fair value adjustments to contingent consideration liabilities of $19.2 million, $1.8 million and $0.3 million for fiscal 2012, 2011 and 2010, respectively.

	September 30, 2012			October 2, 2011
	(in thousands)
Total Assets
ECS	$	877,919		$	767,347
TSS		558,575			505,198
EAS		113,201			111,555
RCM		310,991			296,361
Assets not allocated to segments and intercompany eliminations(1)		(189,656	)		(86,473	)
Total assets	$	1,671,030		$	1,593,988

⁽¹⁾

Assets not allocated to segments include goodwill, intangible assets, deferred income taxes, and certain other assets.

Geographic Information

	Fiscal Year Ended
	September 30, 2012				October 2, 2011				October 3, 2010
	Revenue		Long-Lived Assets(2)		Revenue		Long-Lived Assets(2)		Revenue		Long-Lived Assets(2)
	(in thousands)
United States	$	2,046,700	$	100,958	$	1,976,452	$	102,316	$	1,991,758	$	121,611
Foreign countries(1)		664,375		70,010		596,692		78,198		209,474		15,873

⁽¹⁾

Includes revenue generated from our foreign operations, primarily in Canada, and revenue generated from non-U.S. clients. Long-lived assets consist primarily of amounts from our Canadian operations.

⁽²⁾

Excludes goodwill and intangible assets.

Major Clients

        Other than the U.S. federal government, we had no single client that accounted for more than 10% of our revenue. All of our segments generated revenue from all client sectors.

        The following table presents our revenue by client sector:

	Fiscal Year Ended
	September 30, 2012		October 2, 2011		October 3, 2010
	(in thousands)
Client Sector
International(1)	$	664,375	$	596,692	$	209,474
U.S commercial		718,457		577,782		523,723
U.S. federal government(2)		1,008,424		1,115,729		1,142,082
U.S. state and local government		319,819		282,941		325,953
Total	$	2,711,075	$	2,573,144	$	2,201,232

⁽¹⁾

Includes revenue generated from our foreign operations, primarily in Canada, and revenue generated from non-U.S. clients.

⁽²⁾

Includes revenue generated under U.S. government contracts performed outside the United States.