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Reclassifications out of Accumulated Other Comprehensive Loss (Tables)

3 Months Ended

Dec. 31, 2019

Reclassifications out of Accumulated Other Comprehensive Loss

Schedule of accumulated balances and reporting period activities related to reclassifications out of accumulated other comprehensive loss


			Foreign				Accumulated
	Pension		Currency		Gain/(Loss) on		Other
	Related		Translation		Derivative		Comprehensive
	Adjustments		Adjustments		Instruments		Loss
Balances at September 30, 2019	$	(302.7)	$	(548.7)	$	(12.8)	$	(864.2)
Other comprehensive (loss) income before reclassification		(12.4)		48.0		2.2		37.8
Amounts reclassified from accumulated other comprehensive (loss) income		2.8		—		0.9		3.7
Balances at December 31, 2019	$	(312.3)	$	(500.7)	$	(9.7)	$	(822.7)


			Foreign				Accumulated
	Pension		Currency		Gain/(Loss) on		Other
	Related		Translation		Derivative		Comprehensive
	Adjustments		Adjustments		Instruments		Loss
Balances at September 30, 2018	$	(202.3)	$	(502.2)	$	1.2	$	(703.3)
Other comprehensive income (loss) before reclassification		3.8		(21.8)		(6.8)		(24.8)
Amounts reclassified from accumulated other comprehensive income (loss)		1.5		—		0.5		2.0
Balances at December 31, 2018	$	(197.0)	$	(524.0)	$	(5.1)	$	(726.1)

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2019	Sep. 30, 2019
CURRENT ASSETS:
Cash and cash equivalents	$ 619,683	$ 777,476
Cash in consolidated joint ventures	105,753	108,163
Total cash and cash equivalents	725,436	885,639
Accounts receivable-net	2,839,696	2,869,216
Contract assets	1,671,583	1,581,806
Prepaid expenses and other current assets	532,364	515,593
Current assets held for sale	1,641,896	1,633,302
Income taxes receivable	55,958	49,089
TOTAL CURRENT ASSETS	7,466,933	7,534,645
PROPERTY AND EQUIPMENT-NET	403,882	405,605
DEFERRED TAX ASSETS-NET	229,211	177,573
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	279,286	256,131
GOODWILL	3,492,101	3,476,813
INTANGIBLE ASSETS-NET	94,274	99,636
OTHER NON-CURRENT ASSETS	169,922	172,134
OPERATING LEASE RIGHT-OF-USE ASSETS	647,369
NON-CURRENT ASSETS HELD FOR SALE	2,446,381	2,339,054
TOTAL ASSETS	15,229,359	14,461,591
CURRENT LIABILITIES:
Short-term debt	55,003	47,835
Accounts payable	2,376,867	2,410,838
Accrued expenses and other current liabilities	1,937,339	1,878,319
Income taxes payable	60,417	59,541
Contract liabilities	953,012	851,040
Current liabilities held for sale	1,022,183	1,163,654
Current portion of long-term debt	56,637	50,527
TOTAL CURRENT LIABILITIES	6,461,458	6,461,754
OTHER LONG-TERM LIABILITIES	117,738	271,610
OPERATING LEASE LIABILITIES	745,030
LONG-TERM LIABILITIES HELD FOR SALE	269,604	219,558
DEFERRED TAX LIABILITY-NET	25,122	4,292
PENSION BENEFIT OBLIGATIONS	392,827	387,042
LONG-TERM DEBT	3,358,176	3,217,985
TOTAL LIABILITIES	11,369,955	10,562,241
COMMITMENTS AND CONTINGENCIES (Note 15)
AECOM STOCKHOLDERS' EQUITY:
Common stock-authorized, 300,000,000 shares of $0.01 par value as of December 31, 2019 and September 30, 2019; issued and outstanding 158,192,180 and 157,482,983 shares as of December 31, 2019 and September 30, 2019, respectively	1,582	1,575
Additional paid-in capital	3,956,596	3,953,650
Accumulated other comprehensive loss	(822,666)	(864,197)
Retained earnings	537,490	599,548
TOTAL AECOM STOCKHOLDERS' EQUITY	3,673,002	3,690,576
Noncontrolling interests	186,402	208,774
TOTAL STOCKHOLDERS' EQUITY	3,859,404	3,899,350
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 15,229,359	$ 14,461,591

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Consolidated Statements of Comprehensive Income
Net income	$ 53,094	$ 65,086
Other comprehensive income (loss), net of tax:
Net unrealized gain (loss) on derivatives, net of tax	3,031	(6,298)
Foreign currency translation adjustments	48,206	(21,789)
Pension adjustments, net of tax	(9,599)	5,330
Other comprehensive income (loss), net of tax	41,638	(22,757)
Comprehensive income, net of tax	94,732	42,329
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax	(12,597)	(13,625)
Comprehensive income attributable to AECOM, net of tax	$ 82,135	$ 28,704

Joint Ventures and Variable Interest Entities - Unconsolidated (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Financial Information
Current assets	$ 7,466,933		$ 7,534,645
TOTAL ASSETS	15,229,359		14,461,591
Current liabilities	6,461,458		6,461,754
TOTAL LIABILITIES	11,369,955		10,562,241
TOTAL STOCKHOLDERS EQUITY	3,859,404	$ 4,250,429	3,899,350	$ 4,278,374
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	15,229,359		14,461,591
AECOM's investment in joint ventures	279,286		256,131
Joint ventures summarized financial information
Revenue	3,235,610	3,356,338
Cost of revenue	3,069,810	3,232,942
Gross profit	165,800	123,396
Net income	53,094	65,086
Unconsolidated Joint Ventures
Financial Information
Current assets	1,193,000		1,133,500
Non-current assets	946,000		904,500
TOTAL ASSETS	2,139,000		2,038,000
Current liabilities	1,137,700		1,115,500
Non-current liabilities	121,800		182,300
TOTAL LIABILITIES	1,259,500		1,297,800
TOTAL STOCKHOLDERS EQUITY	879,500		740,200
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	2,139,000		2,038,000
AECOM's investment in joint ventures	279,300		$ 256,100
Joint ventures summarized financial information
Revenue	765,100	765,400
Cost of revenue	746,000	740,000
Gross profit	19,100	25,400
Net income	$ 18,200	$ 24,100

Other Financial Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019
Accrued expenses and other current liabilities
Accrued salaries and benefits	$ 869,100		$ 1,020,700
Accrued contract costs	598,200		583,900
Other accrued expenses	470,000		273,700
Total accrued expenses	1,937,339		1,878,319
Accounts receivable-net	2,839,696		2,869,216
Restructuring costs	44,925	$ 63,295
Accrued restructuring expenses	16,700
Minimum
Accrued expenses and other current liabilities
Estimated restructuring costs	160,000
Maximum
Accrued expenses and other current liabilities
Estimated restructuring costs	190,000
Severance and personnel costs
Accrued expenses and other current liabilities
Restructuring costs	38,200	46,000
Real estate costs
Accrued expenses and other current liabilities
Restructuring costs	6,700	$ 17,300
Professional liability accrual
Accrued expenses and other current liabilities
Accrued contract costs	$ 539,100		$ 536,600

Basis of Presentation

3 Months Ended

Dec. 31, 2019

Basis of Presentation

Basis of Presentation

1. Basis of Presentation

The accompanying consolidated financial statements of AECOM (the Company) are unaudited and, in the opinion of management, include all adjustments, including all normal recurring items necessary for a fair statement of the Company’s financial position and results of operations for the periods presented. All intercompany balances and transactions are eliminated in consolidation.

The consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended September 30, 2019 (the Annual Report). The accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with generally accepted accounting principles (GAAP) in the United States (U.S.) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.

The consolidated financial statements included in this report have been prepared consistently with the accounting policies described in the Annual Report, except as noted, and should be read together with the Annual Report.

The results of operations for the three months ended December 31, 2019 are not necessarily indicative of the results to be expected for the fiscal year ending September 30, 2020.

On January 31, 2020, the Company completed the sale of its Management Services business to an affiliate of American Securities LLC and Lindsay Goldberg LLC for a purchase price of $2.405 billion, subject to cash, debt and working capital adjustments. Additionally, as discussed in more detail in Note 3, the Company concluded that its self-perform at-risk construction businesses met the criteria for held for sale beginning in the first quarter of fiscal year 2020. Collectively, the Management Services business and the self-perform at-risk construction businesses met the criteria for discontinued operation classification. As a result, the Management Services business and the self-perform at-risk construction businesses are presented in the consolidated statements of operations as discontinued operations for all periods presented. Current and non-current assets and liabilities of these businesses are presented in the consolidated balance sheets as assets and liabilities held for sale.

The Company reports its annual results of operations based on 52 or 53-week periods ending on the Friday nearest September 30. The Company reports its quarterly results of operations based on periods ending on the Friday nearest December 31, March 31, and June 30. For clarity of presentation, all periods are presented as if the periods ended on September 30, December 31, March 31, and June 30.

Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended
Earnings Per Share (Details) - shares shares in Thousands	Dec. 31, 2019	Dec. 31, 2018
Earnings Per Share
Denominator for basic earnings per share (in shares)	157,332	156,416
Potential common shares (in shares)	3,400	3,200
Denominator for diluted earnings per share (in shares)	160,657	159,603

Condensed Consolidating Financial Information - Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018
CURRENT ASSETS:
Total cash and cash equivalents	$ 725,436	$ 885,639	$ 686,251
Prepaid expenses and other current assets	532,364	515,593
Current assets held for sale	1,641,896	1,633,302
Income taxes receivable	55,958	49,089
TOTAL CURRENT ASSETS	7,466,933	7,534,645
PROPERTY AND EQUIPMENT-NET	403,882	405,605
DEFERRED TAX ASSETS-NET	229,211	177,573
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	279,286	256,131
GOODWILL	3,492,101	3,476,813
INTANGIBLE ASSETS-NET	94,274	99,636
OTHER NON-CURRENT ASSETS	169,922	172,134
OPERATING LEASE RIGHT-OF-USE ASSETS	647,369
NON-CURRENT ASSETS HELD FOR SALE	2,446,381	2,339,054
TOTAL ASSETS	15,229,359	14,461,591
CURRENT LIABILITIES:
Short-term debt	55,003	47,835
Accounts payable	2,376,867	2,410,838
Accrued expenses and other current liabilities	1,937,339	1,878,319
Income taxes payable	60,417	59,541
Contract liabilities	953,012	851,040
Current liabilities held for sale	1,022,183	1,163,654
Current portion of long-term debt	56,637	50,527
TOTAL CURRENT LIABILITIES	6,461,458	6,461,754
OPERATING LEASE LIABILITIES	745,030
LONG-TERM LIABILITIES HELD FOR SALE	269,604	219,558
DEFERRED TAX LIABILITY-NET	25,122	4,292
LONG-TERM DEBT	3,358,176	3,217,985
TOTAL LIABILITIES	11,369,955	10,562,241
TOTAL AECOM STOCKHOLDERS' EQUITY	3,673,002	3,690,576
Noncontrolling interests	186,402	208,774
TOTAL STOCKHOLDERS' EQUITY	3,859,404	3,899,350	$ 4,250,429	$ 4,278,374
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	15,229,359	14,461,591
Eliminations
CURRENT ASSETS:
Intercompany receivable	(1,598,800)	(1,504,600)
TOTAL CURRENT ASSETS	(1,598,800)	(1,504,600)
DEFERRED TAX ASSETS-NET	(98,800)	(95,200)
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES	(7,757,800)	(7,352,000)
TOTAL ASSETS	(9,455,400)	(8,951,800)
CURRENT LIABILITIES:
Intercompany payable	(1,745,400)	(1,639,500)
TOTAL CURRENT LIABILITIES	(1,745,400)	(1,639,500)
DEFERRED TAX LIABILITY-NET	(98,800)	(95,200)
NOTE PAYABLE INTERCOMPANY-NON CURRENT	(1,349,500)	(1,340,100)
TOTAL LIABILITIES	(3,193,700)	(3,074,800)
TOTAL AECOM STOCKHOLDERS' EQUITY	(6,261,700)	(5,877,000)
TOTAL STOCKHOLDERS' EQUITY	(6,261,700)	(5,877,000)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	(9,455,400)	(8,951,800)
Parent \| Reportable Legal Entities
CURRENT ASSETS:
Total cash and cash equivalents	2,100	129,300
Intercompany receivable	1,138,700	1,164,700
Prepaid expenses and other current assets	76,700	52,500
Income taxes receivable	52,800	13,700
TOTAL CURRENT ASSETS	1,270,300	1,360,200
PROPERTY AND EQUIPMENT-NET	189,900	193,000
DEFERRED TAX ASSETS-NET	152,900	152,800
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES	6,094,800	5,740,800
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	11,300	9,900
OTHER NON-CURRENT ASSETS	29,300	33,100
OPERATING LEASE RIGHT-OF-USE ASSETS	24,300
TOTAL ASSETS	7,772,800	7,489,800
CURRENT LIABILITIES:
Short-term debt	22,300	21,800
Accounts payable	114,600	50,200
Accrued expenses and other current liabilities	79,800	108,000
Income taxes payable	22,200	23,600
Intercompany payable	188,900	116,100
Current portion of long-term debt	13,100	12,600
TOTAL CURRENT LIABILITIES	440,900	332,300
OTHER LONG-TERM LIABILITIES	94,600	130,700
OPERATING LEASE LIABILITIES	96,800
NOTE PAYABLE INTERCOMPANY-NON CURRENT	877,000	872,600
LONG-TERM DEBT	2,607,700	2,468,900
TOTAL LIABILITIES	4,117,000	3,804,500
TOTAL AECOM STOCKHOLDERS' EQUITY	3,655,800	3,685,300
TOTAL STOCKHOLDERS' EQUITY	3,655,800	3,685,300
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	7,772,800	7,489,800
Guarantor Subsidiaries \| Reportable Legal Entities
CURRENT ASSETS:
Total cash and cash equivalents	251,300	273,400
Accounts receivable and contract assets-net	1,935,400	2,023,300
Intercompany receivable	183,000	163,900
Prepaid expenses and other current assets	172,800	174,500
Current assets held for sale	840,900	766,300
TOTAL CURRENT ASSETS	3,383,400	3,401,400
PROPERTY AND EQUIPMENT-NET	122,900	126,000
DEFERRED TAX ASSETS-NET	98,600	45,600
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES	1,663,000	1,611,200
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	18,200	12,400
GOODWILL	2,217,900	2,226,400
INTANGIBLE ASSETS-NET	81,600	85,700
OTHER NON-CURRENT ASSETS	37,900	38,300
OPERATING LEASE RIGHT-OF-USE ASSETS	366,400
NON-CURRENT ASSETS HELD FOR SALE	1,219,500	1,141,100
TOTAL ASSETS	9,209,400	8,688,100
CURRENT LIABILITIES:
Short-term debt	2,600
Accounts payable	1,577,000	1,650,500
Accrued expenses and other current liabilities	633,200	678,500
Intercompany payable	903,700	873,900
Contract liabilities	309,100	299,700
Current liabilities held for sale	562,200	658,100
Current portion of long-term debt	4,800	5,000
TOTAL CURRENT LIABILITIES	3,992,600	4,165,700
OTHER LONG-TERM LIABILITIES	69,500	158,700
OPERATING LEASE LIABILITIES	414,000
LONG-TERM LIABILITIES HELD FOR SALE	195,100	158,800
LONG-TERM DEBT	270,800	260,800
TOTAL LIABILITIES	4,942,000	4,744,000
TOTAL AECOM STOCKHOLDERS' EQUITY	4,267,400	3,944,100
TOTAL STOCKHOLDERS' EQUITY	4,267,400	3,944,100
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	9,209,400	8,688,100
Non-Guarantor Subsidiaries \| Reportable Legal Entities
CURRENT ASSETS:
Total cash and cash equivalents	472,000	482,900
Accounts receivable and contract assets-net	2,575,900	2,427,700
Intercompany receivable	277,100	176,000
Prepaid expenses and other current assets	282,800	288,600
Current assets held for sale	801,000	867,000
Income taxes receivable	3,200	35,400
TOTAL CURRENT ASSETS	4,412,000	4,277,600
PROPERTY AND EQUIPMENT-NET	91,100	86,600
DEFERRED TAX ASSETS-NET	76,500	74,400
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	249,800	233,800
GOODWILL	1,274,200	1,250,400
INTANGIBLE ASSETS-NET	12,700	13,900
OTHER NON-CURRENT ASSETS	102,700	100,800
OPERATING LEASE RIGHT-OF-USE ASSETS	256,700
NON-CURRENT ASSETS HELD FOR SALE	1,226,900	1,198,000
TOTAL ASSETS	7,702,600	7,235,500
CURRENT LIABILITIES:
Short-term debt	30,100	26,000
Accounts payable	685,300	710,100
Accrued expenses and other current liabilities	1,224,400	1,091,800
Income taxes payable	38,200	36,100
Intercompany payable	652,800	649,500
Contract liabilities	643,900	551,300
Current liabilities held for sale	460,000	505,600
Current portion of long-term debt	38,700	32,900
TOTAL CURRENT LIABILITIES	3,773,400	3,603,300
OTHER LONG-TERM LIABILITIES	346,400	369,100
OPERATING LEASE LIABILITIES	234,200
LONG-TERM LIABILITIES HELD FOR SALE	74,500	60,800
DEFERRED TAX LIABILITY-NET	124,000	99,500
NOTE PAYABLE INTERCOMPANY-NON CURRENT	472,500	467,500
LONG-TERM DEBT	479,700	488,300
TOTAL LIABILITIES	5,504,700	5,088,500
TOTAL AECOM STOCKHOLDERS' EQUITY	2,011,500	1,938,200
Noncontrolling interests	186,400	208,800
TOTAL STOCKHOLDERS' EQUITY	2,197,900	2,147,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	7,702,600	7,235,500
Total
CURRENT ASSETS:
Total cash and cash equivalents	725,400	885,600
Accounts receivable and contract assets-net	4,511,300	4,451,000
Prepaid expenses and other current assets	532,300	515,600
Current assets held for sale	1,641,900	1,633,300
Income taxes receivable	56,000	49,100
TOTAL CURRENT ASSETS	7,466,900	7,534,600
PROPERTY AND EQUIPMENT-NET	403,900	405,600
DEFERRED TAX ASSETS-NET	229,200	177,600
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES	279,300	256,100
GOODWILL	3,492,100	3,476,800
INTANGIBLE ASSETS-NET	94,300	99,600
OTHER NON-CURRENT ASSETS	169,900	172,200
OPERATING LEASE RIGHT-OF-USE ASSETS	647,400
NON-CURRENT ASSETS HELD FOR SALE	2,446,400	2,339,100
TOTAL ASSETS	15,229,400	14,461,600
CURRENT LIABILITIES:
Short-term debt	55,000	47,800
Accounts payable	2,376,900	2,410,800
Accrued expenses and other current liabilities	1,937,400	1,878,300
Income taxes payable	60,400	59,700
Contract liabilities	953,000	851,000
Current liabilities held for sale	1,022,200	1,163,700
Current portion of long-term debt	56,600	50,500
TOTAL CURRENT LIABILITIES	6,461,500	6,461,800
OTHER LONG-TERM LIABILITIES	510,500	658,500
OPERATING LEASE LIABILITIES	745,000
LONG-TERM LIABILITIES HELD FOR SALE	269,600	219,600
DEFERRED TAX LIABILITY-NET	25,200	4,300
LONG-TERM DEBT	3,358,200	3,218,000
TOTAL LIABILITIES	11,370,000	10,562,200
TOTAL AECOM STOCKHOLDERS' EQUITY	3,673,000	3,690,600
Noncontrolling interests	186,400	208,800
TOTAL STOCKHOLDERS' EQUITY	3,859,400	3,899,400
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 15,229,400	$ 14,461,600

Revenue Recognition - Performance obligations (Details) $ in Millions	3 Months Ended
	Dec. 31, 2019 USD ($)
Revenue, remaining performance obligations
Performance obligation	$ 17,100.0
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01
Revenue, remaining performance obligations
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period (Deprecated 2018-01-31)	12 months
Percentage of remaining performance obligation expected to be recognized in period	60.00%

Derivative Financial Instruments and Fair Value Measurements

3 Months Ended

Dec. 31, 2019

Derivative Financial Instruments and Fair Value Measurements

Derivative Financial Instruments and Fair Value Measurements

8. Derivative Financial Instruments and Fair Value Measurements

The Company uses interest rate derivative contracts to hedge interest rate exposures on the Company’s variable rate debt. The Company enters into foreign currency derivative contracts with financial institutions to reduce the risk that its cash flows and earnings will be adversely affected by foreign currency exchange rate fluctuations. The Company’s hedging program is not designated for trading or speculative purposes.

The Company recognizes derivative instruments as either assets or liabilities on the accompanying consolidated balance sheets at fair value. The Company records changes in the fair value (i.e., gains or losses) of the derivatives that have been designated as accounting hedges in the accompanying consolidated statements of operations as cost of revenue, interest expense or to accumulated other comprehensive loss in the accompanying consolidated balance sheets.

Cash Flow Hedges

The Company uses interest rate swap agreements designated as cash flow hedges to fix the variable interest rates on portions of the Company’s debt. The Company initially reports any gain on the effective portion of a cash flow hedge as a component of accumulated other comprehensive loss. Depending on the type of cash flow hedge, the gain is subsequently reclassified to interest expense when the interest expense on the variable rate debt is recognized. If the hedged transaction becomes probable of not occurring, any gain or loss related to interest rate swap agreements would be recognized in other income.

The notional principal in U.S. dollar (USD), Canadian dollar (CAD), and Australian dollar (AUD), fixed rates and related expiration dates of the Company’s outstanding interest rate swap agreements were as follows:


	December 31, 2019
Notional Amount	Notional Amount	Fixed	Expiration
Currency	(in millions)	Rate	Date
AUD	200.0	2.19%	February 2021
CAD	400.0	2.49%	September 2022
USD	200.0	2.60%	February 2023


	September 30, 2019
Notional Amount	Notional Amount	Fixed	Expiration
Currency	(in millions)	Rate	Date
AUD	200.0	2.19%	February 2021
CAD	400.0	2.49%	September 2022
USD	200.0	2.60%	February 2023

Other Foreign Currency Forward Contracts

The Company uses foreign currency forward contracts which are not designated as accounting hedges to hedge intercompany transactions and other monetary assets or liabilities denominated in currencies other than the functional currency of a subsidiary. Gains and losses on these contracts were not material for the three months ended December 31, 2019 and 2018.

Fair Value Measurements

The Company’s non-pension financial assets and liabilities recorded at fair values relate to derivative instruments and were not material at December 31, 2019 or September 30, 2019.

See Note 14 for accumulated balances and reporting period activities of derivatives related to reclassifications out of accumulated other comprehensive loss for the three months ended December 31, 2019 and 2018. Amounts recognized in accumulated other comprehensive loss from the Company’s foreign currency options were immaterial for all periods presented. Amounts reclassified from accumulated other comprehensive loss into income from the foreign currency options were immaterial for all periods presented. Additionally, there were no material losses recognized in income due to amounts excluded from effectiveness testing from the Company’s interest rate swap agreements.

Share-based Payments (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019
Stock options, Weighted Average Exercise Price
Vesting period	3 years		3 years
Recognized compensation expense	$ 21.3	$ 15.6
Unrecognized compensation expense	$ 80.8		$ 74.6
Employee Stock Option
Shares of stock under options
Balance at the beginning of the period (in shares)	0.1	0.6	0.6
Balance at the end of the period (in shares)	0.1	0.6	0.1
Vested and expected to vest in the future at the end of the period (in shares)	0.1	0.6
Stock options, Weighted Average Exercise Price
Balance at the beginning of the period (in dollars per share)	$ 31.62	$ 31.62	$ 31.62
Balance at the end of the period (in dollars per share)	31.62	31.62	$ 31.62
Vested and expected to vest in the future at the end of the period (in dollars per share)	$ 31.62	31.62
Performance Earnings Program
Stock options, Weighted Average Exercise Price
Vesting period	3 years
Weighted average grant-date fair value of stock options granted (in dollars per share)	$ 43.06	27.50
Restricted Stock Units (RSUs)
Stock options, Weighted Average Exercise Price
Weighted average grant-date fair value of stock options granted (in dollars per share)	$ 43.06	$ 27.50

Condensed Consolidating Financial Information - Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Condensed Consolidating Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES	$ (206,930)	$ (200,382)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash used in investing activities	(68,125)	(59,697)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	1,810,509	2,290,452
Repayments of borrowings under credit agreements	(1,694,733)	(1,999,140)
Proceeds from issuance of common stock	4,743	5,485
Payments to repurchase common stock	(38,510)	(52,347)
Net distributions to noncontrolling interests	(34,783)	(28,777)
Other financing activities	32,126	(2,439)
Net cash provided by financing activities	79,352	213,234
EFFECT OF EXCHANGE RATE CHANGES ON CASH	2,714	(1,586)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(192,989)	(48,431)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	1,080,354	886,733
CASH AND CASH EQUIVALENTS AT END OF PERIOD	887,365	838,302
Eliminations
CASH FLOWS FROM INVESTING ACTIVITIES:
Net (investment in) receipts from intercompany notes	21,100	(72,800)
Other intercompany investing activities	13,200	514,400
Net cash used in investing activities	34,300	441,600
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings (repayments) on intercompany notes	(21,100)	72,800
Other intercompany financing activities	(13,200)	(514,400)
Net cash provided by financing activities	(34,300)	(441,600)
Parent \| Reportable Legal Entities
Condensed Consolidating Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES	(59,800)	(57,300)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures	(1,300)	(900)
Payments for capital expenditures, net of disposals	(11,200)	(9,800)
Net (investment in) receipts from intercompany notes	(12,500)	19,300
Other intercompany investing activities	(138,700)	(227,200)
Net cash used in investing activities	(163,700)	(218,600)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	1,724,300	2,254,800
Repayments of borrowings under credit agreements	(1,608,200)	(1,959,700)
Proceeds from issuance of common stock	4,700	5,400
Payments to repurchase common stock	(38,500)	(52,300)
Other financing activities	11,500	1,400
Net borrowings (repayments) on intercompany notes	2,500	6,000
Net cash provided by financing activities	96,300	255,600
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(127,200)	(20,300)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	129,300	22,000
CASH AND CASH EQUIVALENTS AT END OF PERIOD	2,100	1,700
Guarantor Subsidiaries \| Reportable Legal Entities
Condensed Consolidating Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES	(146,400)	(22,200)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures	(21,000)	(6,800)
Payments for capital expenditures, net of disposals	(10,100)	(5,700)
Net (investment in) receipts from intercompany notes	(9,400)	61,900
Other intercompany investing activities	125,500	(287,200)
Net cash used in investing activities	85,000	(237,800)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	2,600
Repayments of borrowings under credit agreements	(3,900)	(4,700)
Other financing activities	(35,700)	(9,100)
Net borrowings (repayments) on intercompany notes	1,200	7,900
Other intercompany financing activities	47,900	310,000
Net cash provided by financing activities	12,100	304,100
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(49,300)	44,100
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	315,600	270,900
CASH AND CASH EQUIVALENTS AT END OF PERIOD	266,300	315,000
Non-Guarantor Subsidiaries \| Reportable Legal Entities
Condensed Consolidating Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES	(700)	(120,900)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures	(15,300)	(30,700)
Net proceeds from sale of investments	500	600
Payments for capital expenditures, net of disposals	(9,700)	(6,400)
Net (investment in) receipts from intercompany notes	800	(8,400)
Net cash used in investing activities	(23,700)	(44,900)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	83,600	35,600
Repayments of borrowings under credit agreements	(82,600)	(34,700)
Net distributions to noncontrolling interests	(34,800)	(28,800)
Other financing activities	56,300	5,300
Net borrowings (repayments) on intercompany notes	17,400	(86,700)
Other intercompany financing activities	(34,700)	204,400
Net cash provided by financing activities	5,200	95,100
EFFECT OF EXCHANGE RATE CHANGES ON CASH	2,700	(1,500)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(16,500)	(72,200)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	635,500	593,800
CASH AND CASH EQUIVALENTS AT END OF PERIOD	619,000	521,600
Total
Condensed Consolidating Statements of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES	(206,900)	(200,400)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures	(37,600)	(38,400)
Net proceeds from sale of investments	500	600
Payments for capital expenditures, net of disposals	(31,000)	(21,900)
Net cash used in investing activities	(68,100)	(59,700)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	1,810,500	2,290,400
Repayments of borrowings under credit agreements	(1,694,700)	(1,999,100)
Proceeds from issuance of common stock	4,700	5,400
Payments to repurchase common stock	(38,500)	(52,300)
Net distributions to noncontrolling interests	(34,800)	(28,800)
Other financing activities	32,100	(2,400)
Net cash provided by financing activities	79,300	213,200
EFFECT OF EXCHANGE RATE CHANGES ON CASH	2,700	(1,500)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(193,000)	(48,400)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	1,080,400	886,700
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$ 887,400	$ 838,300

Joint Ventures and Variable Interest Entities - Equity in Earnings (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Financial Information
Equity in earnings of joint ventures	$ 9,928	$ 6,632
Unconsolidated Joint Ventures \| Pass through joint ventures
Financial Information
Equity in earnings of joint ventures	9,200	9,100
Unconsolidated Joint Ventures \| Other joint ventures
Financial Information
Equity in earnings of joint ventures	$ 700	$ (2,500)

Leases - Additional balance sheet information (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Assets:
Operating lease assets	$ 647,369
Balance Sheet classification of operating lease assets	us-gapp:OperatingLeaseRightOfUseAsset
Finance lease assets	$ 50,600
Balance Sheet classification of finance lease assets	us-gaap:PropertyPlantAndEquipmentNet
Total lease assets	$ 698,000
Current:
Operating lease liabilities	$ 173,200
Balance Sheet classification of operating lease liabilities	us-gaap:AccruedLiabilitiesCurrent
Finance lease liabilities	$ 18,400
Balance Sheet classification of finance lease liabilities	us-gaap:LongTermDebtAndCapitalLeaseObligationsCurrent
Total current lease liabilities	$ 191,600
Non-current
Operating lease liabilities	$ 745,030
Balance Sheet classification of operating lease liabilities	us-gaap:OperatingLeaseLiabilityNoncurrent
Finance lease liabilities	$ 40,700
Balance Sheet classification of finance lease liabilities	us-gaap:LongTermDebtAndCapitalLeaseObligations
Total non-current lease liabilities	$ 785,700
Weighted average remaining lease term (in years):
Operating leases	7 years 3 months 18 days
Finance leases	3 years 2 months 12 days
Weighted average discount rates:
Operating leases	4.60%
Finance leases	4.20%

Condensed Consolidating Financial Information

3 Months Ended

Dec. 31, 2019

Condensed Consolidating Financial Information

Condensed Consolidating Financial Information

17. Condensed Consolidating Financial Information

In connection with the registration of the Company’s 2014 Senior Notes that were declared effective by the SEC on September 29, 2015, AECOM became subject to the requirements of Rule 3-10 of Regulation S-X regarding financial statements of guarantors and issuers of guaranteed securities. Both the 2014 Senior Notes and the 2017 Senior Notes are fully and unconditionally guaranteed on a joint and several basis by some of AECOM’s directly and indirectly 100% owned subsidiaries (the Subsidiary Guarantors). Other than customary restrictions imposed by applicable statutes, there are no restrictions on the ability of the Subsidiary Guarantors to transfer funds to AECOM in the form of cash dividends, loans or advances.

The following condensed consolidating financial information, which is presented for AECOM, the Subsidiary Guarantors on a combined basis and AECOM’s non-guarantor subsidiaries on a combined basis, is provided to satisfy the disclosure requirements of Rule 3-10 of Regulation S-X.

Condensed Consolidating Balance Sheets

(unaudited - in millions)

December 31, 2019


			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
ASSETS
CURRENT ASSETS:
Total cash and cash equivalents	$	2.1	$	251.3	$	472.0	$	-	$	725.4
Accounts receivable and contract assets - net		-		1,935.4		2,575.9		-		4,511.3
Intercompany receivable		1,138.7		183.0		277.1		(1,598.8)		-
Prepaid expenses and other current assets		76.7		172.8		282.8		-		532.3
Current assets held for sale		-		840.9		801.0		-		1,641.9
Income taxes receivable		52.8		-		3.2		-		56.0
TOTAL CURRENT ASSETS		1,270.3		3,383.4		4,412.0		(1,598.8)		7,466.9
PROPERTY AND EQUIPMENT—NET		189.9		122.9		91.1		-		403.9
DEFERRED TAX ASSETS—NET		152.9		98.6		76.5		(98.8)		229.2
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES		6,094.8		1,663.0		-		(7,757.8)		-
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES		11.3		18.2		249.8		-		279.3
GOODWILL		-		2,217.9		1,274.2		-		3,492.1
INTANGIBLE ASSETS—NET		-		81.6		12.7		-		94.3
OTHER NON-CURRENT ASSETS		29.3		37.9		102.7		-		169.9
OPERATING LEASE RIGHT-OF-USE ASSETS		24.3		366.4		256.7		-		647.4
NON-CURRENT ASSETS HELD FOR SALE		-		1,219.5		1,226.9		-		2,446.4
TOTAL ASSETS	$	7,772.8	$	9,209.4	$	7,702.6	$	(9,455.4)	$	15,229.4

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	22.3	$	2.6	$	30.1	$	-	$	55.0
Accounts payable		114.6		1,577.0		685.3		-		2,376.9
Accrued expenses and other current liabilities		79.8		633.2		1,224.4		-		1,937.4
Income taxes payable		22.2		-		38.2		-		60.4
Intercompany payable		188.9		903.7		652.8		(1,745.4)		-
Contract liabilities		-		309.1		643.9		-		953.0
Current liabilities held for sale		-		562.2		460.0		-		1,022.2
Current portion of long-term debt		13.1		4.8		38.7		-		56.6
TOTAL CURRENT LIABILITIES		440.9		3,992.6		3,773.4		(1,745.4)		6,461.5
OTHER LONG-TERM LIABILITIES		94.6		69.5		346.4		-		510.5
OPERATING LEASE LIABILITIES		96.8		414.0		234.2		-		745.0
LONG-TERM LIABILITIES HELD FOR SALE		-		195.1		74.5		-		269.6
DEFERRED TAX LIABILITY—NET		-		-		124.0		(98.8)		25.2
NOTE PAYABLE INTERCOMPANY—NON CURRENT		877.0		-		472.5		(1,349.5)		-
LONG-TERM DEBT		2,607.7		270.8		479.7		-		3,358.2
TOTAL LIABILITIES		4,117.0		4,942.0		5,504.7		(3,193.7)		11,370.0
TOTAL AECOM STOCKHOLDERS’ EQUITY		3,655.8		4,267.4		2,011.5		(6,261.7)		3,673.0
Noncontrolling interests		-		-		186.4		-		186.4
TOTAL STOCKHOLDERS’ EQUITY		3,655.8		4,267.4		2,197.9		(6,261.7)		3,859.4
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,772.8	$	9,209.4	$	7,702.6	$	(9,455.4)	$	15,229.4

Condensed Consolidating Balance Sheets

(in millions)

September 30, 2019


			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
ASSETS
CURRENT ASSETS:
Total cash and cash equivalents	$	129.3	$	273.4	$	482.9	$	—	$	885.6
Accounts receivable and contract assets—net		—		2,023.3		2,427.7		—		4,451.0
Intercompany receivable		1,164.7		163.9		176.0		(1,504.6)		—
Prepaid expenses and other current assets		52.5		174.5		288.6		—		515.6
Current assets held for sale		—		766.3		867.0		—		1,633.3
Income taxes receivable		13.7		—		35.4		—		49.1
TOTAL CURRENT ASSETS		1,360.2		3,401.4		4,277.6		(1,504.6)		7,534.6
PROPERTY AND EQUIPMENT—NET		193.0		126.0		86.6		—		405.6
DEFERRED TAX ASSETS—NET		152.8		45.6		74.4		(95.2)		177.6
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES		5,740.8		1,611.2		—		(7,352.0)		—
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES		9.9		12.4		233.8		—		256.1
GOODWILL		—		2,226.4		1,250.4		—		3,476.8
INTANGIBLE ASSETS—NET		—		85.7		13.9		—		99.6
OTHER NON-CURRENT ASSETS		33.1		38.3		100.8		—		172.2
NON-CURRENT ASSETS HELD FOR SALE		—		1,141.1		1,198.0		—		2,339.1
TOTAL ASSETS	$	7,489.8	$	8,688.1	$	7,235.5	$	(8,951.8)	$	14,461.6

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	21.8	$	—	$	26.0	$	—	$	47.8
Accounts payable		50.2		1,650.5		710.1		—		2,410.8
Accrued expenses and other current liabilities		108.0		678.5		1,091.8		—		1,878.3
Income taxes payable		23.6		—		36.1		—		59.7
Intercompany payable		116.1		873.9		649.5		(1,639.5)		—
Contract liabilities		—		299.7		551.3		—		851.0
Current liabilities held for sale		—		658.1		505.6		—		1,163.7
Current portion of long-term debt		12.6		5.0		32.9		—		50.5
TOTAL CURRENT LIABILITIES		332.3		4,165.7		3,603.3		(1,639.5)		6,461.8
OTHER LONG-TERM LIABILITIES		130.7		158.7		369.1		—		658.5
LONG-TERM LIABILITIES HELD FOR SALE		—		158.8		60.8		—		219.6
DEFERRED TAX LIABILITY—NET		—		—		99.5		(95.2)		4.3
NOTE PAYABLE INTERCOMPANY—NON CURRENT		872.6		—		467.5		(1,340.1)		—
LONG-TERM DEBT		2,468.9		260.8		488.3		—		3,218.0
TOTAL LIABILITIES		3,804.5		4,744.0		5,088.5		(3,074.8)		10,562.2
TOTAL AECOM STOCKHOLDERS’ EQUITY		3,685.3		3,944.1		1,938.2		(5,877.0)		3,690.6
Noncontrolling interests		—		—		208.8		—		208.8
TOTAL STOCKHOLDERS’ EQUITY		3,685.3		3,944.1		2,147.0		(5,877.0)		3,899.4
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,489.8	$	8,688.1	$	7,235.5	$	(8,951.8)	$	14,461.6

Condensed Consolidating Statements of Operations

(unaudited - in millions)


	For the Three Months Ended December 31, 2019
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Revenue	$	—	$	1,755.6	$	1,495.4	$	(15.4)	$	3,235.6
Cost of Revenue		—		1,695.6		1,389.6		(15.4)		3,069.8
Gross Profit		—		60.0		105.8		—		165.8
Equity in earnings from subsidiaries		182.4		61.1		—		(243.5)		—
Equity in earnings of joint ventures		—		5.6		4.3		—		9.9
General and administrative expenses		(41.2)		—		(2.4)		—		(43.6)
Restructuring costs		(44.9)		—		—		—		(44.9)
Income from operations		96.3		126.7		107.7		(243.5)		87.2
Other income		0.1		11.7		5.8		(13.6)		4.0
Interest expense		(39.0)		(6.8)		(8.2)		13.6		(40.4)
Income from continuing operations before income taxes		57.4		131.6		105.3		(243.5)		50.8
Income tax expense (benefit) for continuing operations		9.7		(1.1)		7.3		—		15.9

Net income from continuing operations		47.7		132.7		98.0		(243.5)		34.9
Net income from discontinued operations		(7.1)		50.0		(24.7)		—		18.2
Net income		40.6		182.7		73.3		(243.5)		53.1

Net income attributable to noncontrolling interest from continuing operations		—		—		(4.0)		—		(4.0)
Net income attributable to noncontrolling interest from discontinued operations		—		—		(8.5)		—		(8.5)
Net income attributable to noncontrolling interest		—		—		(12.5)		—		(12.5)

Net income attributable to AECOM from continuing operations		47.7		132.7		94.0		(243.5)		30.9
Net income attributable to AECOM from discontinued operations		(7.1)		50.0		(33.2)		—		9.7
Net income attributable to AECOM	$	40.6	$	182.7	$	60.8	$	(243.5)	$	40.6


	For the three months ended December 31, 2018
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Revenue	$	—	$	1,802.3	$	1,574.9	$	(20.9)	$	3,356.3
Cost of revenue		—		1,727.0		1,526.8		(20.9)		3,232.9
Gross profit		—		75.3		48.1		—		123.4
Equity in earnings from subsidiaries		153.5		(52.4)		—		(101.1)		—
Equity in earnings of joint ventures		—		7.9		(1.3)		—		6.6
General and administrative expenses		(34.2)		—		(1.7)		—		(35.9)
Restructuring costs		(63.3)		—		—		—		(63.3)
Income from operations		56.0		30.8		45.1		(101.1)		30.8
Other income		1.2		11.3		3.8		(13.3)		3.0
Interest expense		(39.2)		(5.0)		(8.5)		13.3		(39.4)
Income from continuing operations before taxes		18.0		37.1		40.4		(101.1)		(5.6)
Income tax benefit for continuing operations		(41.2)		(1.3)		—		—		(42.5)
Net income from continuing operations		59.2		38.4		40.4		(101.1)		36.9
Net (loss) income from discontinued operations		(7.8)		22.4		13.6		—		28.2
Net income		51.4		60.8		54.0		(101.1)		65.1
Net income attributable to noncontrolling interests from continuing operations		—		—		(5.0)		—		(5.0)
Net income attributable to noncontrolling interests from discontinued operations		—		—		(8.6)		—		(8.6)
Net income attributable to noncontrolling interests		—		—		(13.6)		—		(13.6)
Net income attributable to AECOM from continuing operations		59.2		38.4		35.4		(101.1)		31.9
Net (loss) income attributable to AECOM from discontinued operations		(7.8)		22.4		5.0		—		19.6
Net income attributable to AECOM	$	51.4	$	60.8	$	40.4	$	(101.1)	$	51.5

Consolidating Statements of Comprehensive Income

(unaudited - in millions)


	For the Three Months Ended December 31, 2019
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Net income	$	40.6	$	182.7	$	73.3	$	(243.5)	$	53.1
Other comprehensive income (loss), net of tax:
Net unrealized gain on derivatives, net of tax		0.9		—		2.1		—		3.0
Foreign currency translation adjustments		—		—		48.2		—		48.2
Pension adjustments, net of tax		1.0		—		(10.6)		—		(9.6)
Other comprehensive income, net of tax		1.9		—		39.7		—		41.6
Comprehensive income, net of tax		42.5		182.7		113.0		(243.5)		94.7
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax		—		—		(12.6)		—		(12.6)
Comprehensive income attributable to AECOM, net of tax	$	42.5	$	182.7	$	100.4	$	(243.5)	$	82.1


	For the three months ended December 31, 2018
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Net income	$	51.4	$	60.8	$	54.0	$	(101.1)	$	65.1
Other comprehensive loss, net of tax:
Net unrealized loss on derivatives, net of tax		(2.4)		—		(3.9)		—		(6.3)
Foreign currency translation adjustments		—		—		(21.8)		—		(21.8)
Pension adjustments, net of tax		0.7		—		4.6		—		5.3
Other comprehensive loss, net of tax		(1.7)		—		(21.1)		—		(22.8)
Comprehensive income, net of tax		49.7		60.8		32.9		(101.1)		42.3
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax		—		—		(13.6)		—		(13.6)
Comprehensive income attributable to AECOM, net of tax	$	49.7	$	60.8	$	19.3	$	(101.1)	$	28.7

Condensed Consolidating Statements of Cash Flows

(unaudited - in millions)


	For the three months ended December 31, 2019
					Non-
			Guarantor		Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total

CASH FLOWS FROM OPERATING ACTIVITIES	$	(59.8)	$	(146.4)	$	(0.7)	$	—	$	(206.9)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures		(1.3)		(21.0)		(15.3)		—		(37.6)
Net proceeds from sale of investment securities		—		—		0.5		—		0.5
Payments for capital expenditures, net of disposals		(11.2)		(10.1)		(9.7)		—		(31.0)
Net (investment in) receipts from intercompany notes		(12.5)		(9.4)		0.8		21.1		—
Other Intercompany investing activities		(138.7)		125.5		—		13.2		—
Net cash (used in) provided by investing activities		(163.7)		85.0		(23.7)		34.3		(68.1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements		1,724.3		2.6		83.6		—		1,810.5
Repayments of borrowings under credit agreements		(1,608.2)		(3.9)		(82.6)		—		(1,694.7)
Proceeds from issuance of common stock		4.7		—		—		—		4.7
Payments to repurchase of common stock		(38.5)		—		—		—		(38.5)
Net distributions to noncontrolling interests		—		—		(34.8)		—		(34.8)
Other financing activities		11.5		(35.7)		56.3		—		32.1
Net borrowings on intercompany notes		2.5		1.2		17.4		(21.1)		—
Other intercompany financing activities		—		47.9		(34.7)		(13.2)		—
Net cash provided by financing activities		96.3		12.1		5.2		(34.3)		79.3
EFFECT OF EXCHANGE RATE CHANGES ON CASH		—		—		2.7		—		2.7
NET DECREASE IN CASH AND CASH EQUIVALENTS		(127.2)		(49.3)		(16.5)		—		(193.0)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		129.3		315.6		635.5		—		1,080.4
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	2.1	$	266.3	$	619.0	$	—	$	887.4


	For the three months ended December 31, 2018
					Non-
			Guarantor		Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total

CASH FLOWS FROM OPERATING ACTIVITIES	$	(57.3)	$	(22.2)	$	(120.9)	$	—	$	(200.4)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures		(0.9)		(6.8)		(30.7)		—		(38.4)
Net proceeds from sale of investments		—		—		0.6		—		0.6
Payments for capital expenditures, net of disposals		(9.8)		(5.7)		(6.4)		—		(21.9)
Net receipts from (investment in) intercompany notes		19.3		61.9		(8.4)		(72.8)		—
Other intercompany investing activities		(227.2)		(287.2)		—		514.4		—
Net cash used in investing activities		(218.6)		(237.8)		(44.9)		441.6		(59.7)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements		2,254.8		—		35.6		—		2,290.4
Repayments of borrowings under credit agreements		(1,959.7)		(4.7)		(34.7)		—		(1,999.1)
Proceeds from issuance of common stock		5.4		—		—		—		5.4
Payments to repurchase common stock		(52.3)		—		—		—		(52.3)
Net distributions to noncontrolling interests		—		—		(28.8)		—		(28.8)
Other financing activities		1.4		(9.1)		5.3		—		(2.4)
Net borrowings (repayments) on intercompany notes		6.0		7.9		(86.7)		72.8		—
Other intercompany financing activities		—		310.0		204.4		(514.4)		—
Net cash provided by financing activities		255.6		304.1		95.1		(441.6)		213.2
EFFECT OF EXCHANGE RATE CHANGES ON CASH		—		—		(1.5)		—		(1.5)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(20.3)		44.1		(72.2)		—		(48.4)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		22.0		270.9		593.8		—		886.7
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	1.7	$	315.0	$	521.6	$	—	$	838.3

Discontinued Operations, Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2019
Identifiable intangible assets with finite useful lives
Intangible Assets, Net	$ 99,636	$ 94,274
Backlog and customer relationships
Identifiable intangible assets with finite useful lives
Gross Amount	661,400	662,200
Accumulated Amortization	(561,800)	(567,900)
Intangible Assets, Net	$ 99,600	$ 94,300
Backlog and customer relationships \| Minimum
Identifiable intangible assets with finite useful lives
Amortization Period	1 year
Backlog and customer relationships \| Maximum
Identifiable intangible assets with finite useful lives
Amortization Period	11 years

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
Income Taxes (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Income Taxes
Effective tax rate (as a percent)	31.30%	758.90%
Federal statutory rate (as a percent)	21.00%	21.00%
Income tax expense nondeductible Costs	$ 5.6
Tax expense related to Foreign residual income	4.0
State income tax expense	2.8
Income tax credits and incentives	7.4
Valuation allowance on foreign tax credits		$ 38.1
Net benefit from Tax Cuts and Jobs Acts of 2017		$ 38.1
Gross book-tax differences from non-U.S. subsidiaries	$ 1,700.0

Reportable Segments

3 Months Ended

Dec. 31, 2019

Reportable Segments

Reportable Segments

16. Reportable Segments

During the first quarter of fiscal 2020, the Company reorganized its operating and reporting structure to better align with its ongoing professional services business. This reorganization better reflects the continuing operations of the Company after the planned disposals of its former Management Services reportable business segment and self-perform at-risk construction businesses discussed in Note 3. The businesses that comprised the Company’s former Management Services reportable business segment and the civil infrastructure, power and oil and gas construction businesses in the

former Construction Services reportable business segment were classified as discontinued operations. The former Design and Consulting Services reportable business segment and construction management business in the former Construction Services reportable business segment were reformed around geographic regions. The Americas segment provides planning, consulting, architectural and engineering design services, and construction management services to commercial and government clients in the United States, Canada, and Latin America, while the International segment provides similar professional services to commercial and government clients in Europe, the Middle East, Africa, and the Asia-Pacific regions.

The Company’s AECOM Capital (ACAP) segment primarily invests in and develops real estate projects. These reportable segments are organized by the differing specialized needs of the respective clients, and how the Company manages its business. The Company has aggregated various operating segments into its reportable segments based on their similar characteristics, including similar long term financial performance, the nature of services provided, internal processes for delivering those services, and types of customers. The change in reportable segments was applied to all periods presented.

The following tables set forth summarized financial information concerning the Company’s reportable segments:


							AECOM
Reportable Segments:	Americas			International			Capital		Corporate		Total
	(in millions)
Three Months Ended December 31, 2019:
Revenue	$	2,452.0		$	783.1		$	0.5	$	—	$	3,235.6
Gross profit		139.4			25.9			0.5		—		165.8
Equity in earnings of joint ventures		6.4			2.8			0.7		—		9.9
General and administrative expenses		—			—			(2.4)		(41.2)		(43.6)
Restructuring costs		—			—			—		(44.9)		(44.9)
Operating income (loss)		145.8			28.7			(1.2)		(86.1)		87.2
Gross profit as a % of revenue		5.7	%		3.3	%		—		—		5.1	%

Three Months Ended December 31, 2018:
Revenue	$	2,560.4		$	792.0		$	3.9	$	—	$	3,356.3
Gross profit		107.2			12.3			3.9		—		123.4
Equity in earnings (losses) of joint ventures		6.3			2.8			(2.5)		—		6.6
General and administrative expenses		—			—			(1.7)		(34.2)		(35.9)
Restructuring costs		—			—			—		(63.3)		(63.3)
Operating income (loss)		113.5			15.1			(0.3)		(97.5)		30.8
Gross profit as a % of revenue		4.2	%		1.6	%		—		—		3.7	%


Reportable Segments:
Total assets
December 31,2019	$	7,764.4	$	2,529.6	$	203.2	$	643.8
September 30, 2019		7,437.3		2,247.1		197.8		607.0

Revenue Recognition - Accounts receivable, net (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019
Billed	$ 2,285,600	$ 2,284,800
Contract retentions	621,500	641,500
Total accounts receivable-gross	2,907,100	2,926,300
Allowance for doubtful accounts	(67,400)	(57,100)
Total accounts receivable-net	$ 2,839,696	$ 2,869,216
Additional disclosures
Unbilled receivables are expected to be billed and collected (in months)	12 months	12 months
Significant claims recorded in contract assets and other non-current assets	$ 110,000	$ 110,000
Trade receivables sold, outstanding	$ 100,800	$ 91,900
Other than U.S government outstanding receivables
Additional disclosures
Number of clients	0	0
Outstanding receivables (as a percent)	10.00%	10.00%

Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Sep. 30, 2019	Oct. 17, 2014
Debt
Total debt	$ 3,503,900	$ 3,352,500
Less: Current portion of debt and short-term borrowings	(111,600)	(98,300)
Less: Unamortized debt issuance costs	(34,100)	(36,200)
Long-term debt	3,358,176	3,217,985
2014 Credit Agreement
Debt
Total debt	1,323,200	1,182,200
2014 Senior Notes
Debt
Total debt	800,000	800,000
2017 Senior Notes
Debt
Total debt	1,000,000	1,000,000
URS Senior Notes
Debt
Total debt	248,100	248,100	$ 1,000,000
Other Debt
Debt
Total debt	$ 132,600	$ 122,200

Debt - Scheduled Maturities (Details) - USD ($) $ in Millions	Dec. 31, 2019	Sep. 30, 2019
Debt
2020 (nine months remaining)	$ 104.2
2021	199.1
2022	301.8
2023	578.0
2024	9.7
Thereafter	2,311.1
Total debt	$ 3,503.9	$ 3,352.5

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended
Revenue Recognition (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019	Oct. 01, 2018
Revenue Recognition
Retained earnings	$ 537,490		$ 599,548
Revenue	3,235,610	$ 3,356,338
Accounting Standards Update 2014-09
Revenue Recognition
Retained earnings				$ (7,000)
Subcontractor and other direct costs	$ 1,700	$ 1,800

Debt - Effective Interest Rate (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Debt
Effective interest rate including effects of interest rate swap agreements	4.9%	5.1%
Amortization of deferred debt issuance costs	$ 1.3	$ 1.3

Leases - Total remaining lease payments under the Company's Finance lease (Details) $ in Millions	Dec. 31, 2019 USD ($)
Leases
2020 (nine months remaining)	$ 14.9
2021	18.5
2022	15.9
2023	10.0
2024	3.2
Thereafter	0.7
Total lease payments	63.2
Less: Amounts representing interest	(4.1)
Total lease liabilities	$ 59.1

Earnings Per Share

3 Months Ended

Dec. 31, 2019

Earnings Per Share

Earnings Per Share

11. Earnings Per Share

Basic earnings per share (EPS) excludes dilution and is computed by dividing net income attributable to AECOM by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income attributable to AECOM by the weighted average number of common shares outstanding and potential common shares for the period. The Company includes as potential common shares the weighted average dilutive effects of equity awards using the treasury stock method. For the three months ended December 31, 2019 and 2018, equity awards excluded from the calculation of potential common shares were not significant .

The following table sets forth a reconciliation of the denominators for basic and diluted earnings per share:


	Three Months Ended
	December 31,	December 31,
	2019	2018
	(in millions)
Denominator for basic earnings per share	157.3	156.4
Potential common shares	3.4	3.2
Denominator for diluted earnings per share	160.7	159.6

Revenue Recognition - Disaggregated revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Revenue Recognition
Revenue	$ 3,235,610	$ 3,356,338
Cost reimbursable
Revenue Recognition
Revenue	1,394,400	1,429,000
Guaranteed maximum price
Revenue Recognition
Revenue	947,500	1,030,300
Fixed price
Revenue Recognition
Revenue	893,700	897,000
Americas
Revenue Recognition
Revenue	2,452,500	2,564,300
Europe, Middle East, Africa
Revenue Recognition
Revenue	429,600	430,300
Asia Pacific
Revenue Recognition
Revenue	$ 353,500	$ 361,700

Pension Benefit Obligations

3 Months Ended

Dec. 31, 2019

Pension Benefit Obligations

Pension Benefit Obligations

6. Pension Benefit Obligations

In the U.S., the Company sponsors various qualified defined benefit pension plans. Benefits under these plans generally are based on the employee’s years of creditable service and compensation; however, all U.S. defined benefit plans are closed to new participants and have frozen accruals.

The Company also sponsors various non-qualified plans in the U.S.; all of these plans are frozen. Outside the U.S., the Company sponsors various pension plans, which are appropriate to the country in which the Company operates, some of which are government mandated.

The components of net periodic benefit cost other than the service cost component are included in other income in the consolidated statement of operations. The following table details the components of net periodic benefit cost for the Company’s pension plans for the three months ended December 31, 2019 and 2018:


	Three Months Ended
	December 31, 2019				December 31, 2018
	U.S.		Int’l		U.S.		Int’l
	(in millions)
Components of net periodic benefit cost:
Service costs	$	—	$	0.2	$	—	$	0.1
Interest cost on projected benefit obligation		1.6		5.6		2.2		7.4
Expected return on plan assets		(1.8)		(9.4)		(2.3)		(9.5)
Amortization of net loss		1.2		2.1		1.0		1.0
Settlement loss recognized		—		—		—		0.1
Net periodic benefit cost	$	1.0	$	(1.5)	$	0.9	$	(0.9)

The total amounts of employer contributions paid for the three months ended December 31, 2019 were $2.4 million for U.S. plans and $6.9 million for non-U.S. plans. The expected remaining scheduled annual employer contributions for the fiscal year ending September 30, 2020 are $7.1 million for U.S. plans and $20.8 million for non-U.S. plans.

Condensed Consolidating Financial Information - Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Consolidated Statements of Comprehensive Income
Net income	$ 53,094	$ 65,086
Other comprehensive (loss) income, net of tax:
Net unrealized loss on derivatives, net of tax	3,031	(6,298)
Foreign currency translation adjustments	48,206	(21,789)
Pension adjustments, net of tax	(9,599)	5,330
Other comprehensive income (loss), net of tax	41,638	(22,757)
Comprehensive income, net of tax	94,732	42,329
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax	(12,597)	(13,625)
Comprehensive income attributable to AECOM, net of tax	82,135	28,704
Eliminations
Consolidated Statements of Comprehensive Income
Net income	(243,500)	(101,100)
Other comprehensive (loss) income, net of tax:
Comprehensive income, net of tax	(243,500)	(101,100)
Comprehensive income attributable to AECOM, net of tax	(243,500)	(101,100)
Parent \| Reportable Legal Entities
Consolidated Statements of Comprehensive Income
Net income	40,600	51,400
Other comprehensive (loss) income, net of tax:
Net unrealized loss on derivatives, net of tax	900	(2,400)
Pension adjustments, net of tax	1,000	700
Other comprehensive income (loss), net of tax	1,900	(1,700)
Comprehensive income, net of tax	42,500	49,700
Comprehensive income attributable to AECOM, net of tax	42,500	49,700
Guarantor Subsidiaries \| Reportable Legal Entities
Consolidated Statements of Comprehensive Income
Net income	182,700	60,800
Other comprehensive (loss) income, net of tax:
Comprehensive income, net of tax	182,700	60,800
Comprehensive income attributable to AECOM, net of tax	182,700	60,800
Non-Guarantor Subsidiaries \| Reportable Legal Entities
Consolidated Statements of Comprehensive Income
Net income	73,300	54,000
Other comprehensive (loss) income, net of tax:
Net unrealized loss on derivatives, net of tax	2,100	(3,900)
Foreign currency translation adjustments	48,200	(21,800)
Pension adjustments, net of tax	(10,600)	4,600
Other comprehensive income (loss), net of tax	39,700	(21,100)
Comprehensive income, net of tax	113,000	32,900
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax	(12,600)	(13,600)
Comprehensive income attributable to AECOM, net of tax	100,400	19,300
Total
Consolidated Statements of Comprehensive Income
Net income	$ 53,100	$ 65,100

Reclassifications out of Accumulated Other Comprehensive Loss

3 Months Ended

Dec. 31, 2019

Reclassifications out of Accumulated Other Comprehensive Loss

Reclassifications out of Accumulated Other Comprehensive Loss

14. Reclassifications out of Accumulated Other Comprehensive Loss

The accumulated balances and reporting period activities for the three months ended December 31, 2019 and 2018 related to reclassifications out of accumulated other comprehensive loss are summarized as follows (in millions):


			Foreign				Accumulated
	Pension		Currency		Gain/(Loss) on		Other
	Related		Translation		Derivative		Comprehensive
	Adjustments		Adjustments		Instruments		Loss
Balances at September 30, 2019	$	(302.7)	$	(548.7)	$	(12.8)	$	(864.2)
Other comprehensive (loss) income before reclassification		(12.4)		48.0		2.2		37.8
Amounts reclassified from accumulated other comprehensive (loss) income		2.8		—		0.9		3.7
Balances at December 31, 2019	$	(312.3)	$	(500.7)	$	(9.7)	$	(822.7)


			Foreign				Accumulated
	Pension		Currency		Gain/(Loss) on		Other
	Related		Translation		Derivative		Comprehensive
	Adjustments		Adjustments		Instruments		Loss
Balances at September 30, 2018	$	(202.3)	$	(502.2)	$	1.2	$	(703.3)
Other comprehensive income (loss) before reclassification		3.8		(21.8)		(6.8)		(24.8)
Amounts reclassified from accumulated other comprehensive income (loss)		1.5		—		0.5		2.0
Balances at December 31, 2018	$	(197.0)	$	(524.0)	$	(5.1)	$	(726.1)

Debt

3 Months Ended

Dec. 31, 2019

Debt

Debt

7. Debt

Debt consisted of the following:


	December 31,		September 30,
	2019		2019
	(in millions)
2014 Credit Agreement	$	1,323.2	$	1,182.2
2014 Senior Notes		800.0		800.0
2017 Senior Notes		1,000.0		1,000.0
URS Senior Notes		248.1		248.1
Other debt		132.6		122.2
Total debt		3,503.9		3,352.5
Less: Current portion of debt and short-term borrowings		(111.6)		(98.3)
Less: Unamortized debt issuance costs		(34.1)		(36.2)
Long-term debt	$	3,358.2	$	3,218.0

The following table presents, in millions, scheduled maturities of the Company’s debt as of December 31, 2019:


Fiscal Year
2020 (nine months remaining)	$	104.2
2021		199.1
2022		301.8
2023		578.0
2024		9.7
Thereafter		2,311.1
Total	$	3,503.9

2014 Credit Agreement

The Company entered into a credit agreement (Credit Agreement) on October 17, 2014, which, as amended to date, consists of (i) a term loan A facility that includes a $510 million (US) term loan A facility with a term expiring on March 13, 2021 and a $500 million Canadian dollar (CAD) term loan A facility and a $250 million Australian dollar (AUD) term loan A facility, each with terms expiring on March 13, 2023; (ii) a $600 million term loan B facility with a term expiring on March 13, 2025; and (iii) a revolving credit facility in an aggregate principal amount of $1.35 billion with a term expiring on March 13, 2023. Some of subsidiaries of the Company (Guarantors) have guaranteed the obligations of the borrowers under the Credit Agreement. The borrowers’ obligations under the Credit Agreement are secured by a lien on substantially all of the assets of the Company and the Guarantors pursuant to a security and pledge agreement (Security Agreement). The collateral under the Security Agreement is subject to release upon fulfillment of conditions specified in the Credit Agreement and Security Agreement.

The Credit Agreement contains covenants that limit the ability of the Company and the ability of some of its subsidiaries to, among other things: (i) create, incur, assume, or suffer to exist liens; (ii) incur or guarantee indebtedness; (iii) pay dividends or repurchase stock; (iv) enter into transactions with affiliates; (v) consummate asset sales, acquisitions or mergers; (vi) enter into various types of burdensome agreements; or (vii) make investments.

On July 1, 2015, the Credit Agreement was amended to revise the definition of “Consolidated EBITDA” to increase the allowance for acquisition and integration expenses related to the Company’s acquisition of URS.

On December 22, 2015, the Credit Agreement was amended to further revise the definition of “Consolidated EBITDA” by further increasing the allowance for acquisition and integration expenses related to the acquisition of URS and to allow for an internal corporate restructuring primarily involving the Company’s international subsidiaries.

On September 29, 2016, the Credit Agreement and the Security Agreement were amended to (1) lower the applicable interest rate margins for the term loan A and the revolving credit facilities, and lower the applicable letter of credit fees and commitment fees to the revised consolidated leverage levels; (2) extend the term of the term loan A and the revolving credit facility to September 29, 2021; (3) add a new delayed draw term loan A facility tranche in the amount of $185.0 million; (4) replace the then existing $500 million performance letter of credit facility with a $500 million basket to enter into secured letters of credit outside the Credit Agreement; and (5) revise covenants, including the Maximum Consolidated Leverage Ratio so that the step down from a 5.00 to a 4.75 leverage ratio is effective as of March 31, 2017 as well as the investment basket for the Company’s AECOM Capital business.

On March 31, 2017, the Credit Agreement was amended to (1) expand the ability of restricted subsidiaries to borrow under “Incremental Term Loans;” (2) revise the definition of “Working Capital” as used in “Excess Cash Flow;” (3) revise the definitions for “Consolidated EBITDA” and “Consolidated Funded Indebtedness” to reflect the expected gain and debt repayment of an AECOM Capital disposition, which disposition was completed on April 28, 2017; and (4) amend provisions relating to the Company’s ability to undertake internal restructuring steps to accommodate changes in tax laws.

On March 13, 2018, the Credit Agreement was amended to (1) refinance the existing term loan A facility to include a $510 million (US) term loan A facility with a term expiring on March 13, 2021 and a $500 million CAD term loan A facility and a $250 million AUD term loan A facility each with terms expiring on March 13, 2023; (2) issue a new $600 million term loan B facility to institutional investors with a term expiring on March 13, 2025; (3) increase the capacity of the Company’s revolving credit facility from $1.05 billion to $1.35 billion and extend its term until March 13, 2023; (4) reduce the Company’s interest rate borrowing costs as follows: (a) the term loan B facility, at the Company’s election, Base Rate (as defined in the Credit Agreement) plus 0.75% or Eurocurrency Rate (as defined in the Credit Agreement) plus 1.75%, (b) the (US) term loan A facility, at the Company’s election, Base Rate plus 0.50% or Eurocurrency Rate plus 1.50%, and (c) the Canadian (CAD) term loan A facility, the Australian (AUD) term loan A facility, and the revolving credit facility, an initial rate of, at the Company’s election, Base Rate plus 0.75% or Eurocurrency Rate plus 1.75%, and after the end of the Company’s fiscal quarter ended June 30, 2018, Base Rate loans plus a margin ranging from 0.25% to 1.00% or Eurocurrency Rate plus a margin from 1.25% to 2.00%, based on the Consolidated Leverage Ratio (as defined in the Credit Agreement); (5) revise covenants including increasing the amounts available under the restricted payment negative covenant and revising the Maximum Consolidated Leverage Ratio (as defined in the Credit Agreement) to include a 4.5 leverage ratio through September 30, 2019 after which the leverage ratio stepped down to 4.0.

On November 13, 2018, the Credit Agreement was amended to revise the definition of "Consolidated EBITDA" to increase corporate restructuring allowances and provide for additional flexibility under the covenants for non-core asset dispositions, among other changes.

On January 28, 2020, AECOM entered into Amendment No. 7 to the Credit Agreement which modifies the asset disposition covenant to permit the sale of our Management Services business and the mandatory prepayment provision so that only outstanding term loans are prepaid using the net proceeds from the sale.

Under the Credit Agreement, the Company is subject to a maximum consolidated leverage ratio and minimum consolidated interest coverage ratio at the end of each fiscal quarter. The Company’s Consolidated Leverage Ratio was 3.6 at December 31, 2019. The Company’s Consolidated Interest Coverage Ratio was 4.9 at December 31, 2019. As of December 31, 2019, the Company was in compliance with the covenants of the Credit Agreement.

At December 31, 2019 and September 30, 2019, outstanding standby letters of credit totaled $22.8 million and $22.8 million, respectively, under the Company’s revolving credit facilities. As of December 31, 2019 and September 30, 2019, the Company had $1,193.5 million and $1,327.2 million, respectively, available under its revolving credit facility.

2014 Senior Notes

On October 6, 2014, the Company completed a private placement offering of $800,000,000 aggregate principal amount of the unsecured 5.750% Senior Notes due 2022 (2022 Notes) and $800,000,000 aggregate principal amount of the unsecured 5.875% Senior Notes due 2024 (the 2024 Notes and, together with the 2022 Notes, the 2014 Senior Notes). On November 2, 2015, the Company completed an exchange offer to exchange the unregistered 2014 Senior Notes for registered notes, as well as all related guarantees. On March 16, 2018, the Company redeemed all of the 2022 Notes at a redemption price that was 104.313% of the principal amount outstanding plus accrued and unpaid interest. The March 16, 2018 redemption resulted in a $34.5 million prepayment premium, which was included in interest expense.

As of December 31, 2019, the estimated fair value of the 2024 Notes was approximately $886.0 million. The fair value of the 2024 Notes as of December 31, 2019 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2024 Notes.

At any time prior to July 15, 2024, the Company may redeem on one or more occasions all or part of the 2024 Notes at a redemption price equal to the sum of (i) 100% of the principal amount thereof, plus (ii) a “make-whole” premium as of the date of the redemption, plus any accrued and unpaid interest to the date of redemption. In addition, on or after July 15, 2024, the 2024 Notes may be redeemed at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest to the date of redemption.

The indenture pursuant to which the 2024 Notes were issued contains customary events of default, including, among other things, payment default, exchange default, failure to provide notices thereunder and provisions related to bankruptcy events. The indenture also contains customary negative covenants.

The Company was in compliance with the covenants relating to the 2024 Notes as of December 31, 2019.

2017 Senior Notes

On February 21, 2017, the Company completed a private placement offering of $1,000,000,000 aggregate principal amount of its unsecured 5.125% Senior Notes due 2027 (the 2017 Senior Notes) and used the proceeds to immediately retire the remaining $127.6 million outstanding on the then existing term loan B facility as well as repay $600 million of the term loan A facility and $250 million of the revolving credit facility under its Credit Agreement. On June 30, 2017, the Company completed an exchange offer to exchange the unregistered 2017 Senior Notes for registered notes, as well as related guarantees.

As of December 31, 2019, the estimated fair value of the 2017 Senior Notes was approximately $1,075.0 million. The fair value of the 2017 Senior Notes as of December 31, 2019 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2017 Senior Notes. Interest will be payable on the 2017 Senior Notes at a rate of 5.125% per annum. Interest on the 2017 Senior Notes is payable semi-annually on March 15 and September 15 of each year, commencing on September 15, 2017. The 2017 Senior Notes will mature on March 15, 2027.

At any time and from time to time prior to December 15, 2026, the Company may redeem all or part of the 2017 Senior Notes, at a redemption price equal to 100% of their principal amount, plus a “make whole” premium as of the redemption date, and accrued and unpaid interest to the redemption date.

In addition, at any time and from time to time prior to March 15, 2020, the Company may redeem up to 35% of the original aggregate principal amount of the 2017 Senior Notes with the proceeds of one or more qualified equity offerings, at a redemption price equal to 105.125%, plus accrued and unpaid interest. Furthermore, at any time on or after December 15, 2026, the Company may redeem on one or more occasions all or part of the 2017 Senior Notes at a redemption price equal to 100% of their principal amount, plus accrued and unpaid interest.

The indenture pursuant to which the 2017 Senior Notes were issued contains customary events of default, including, among other things, payment default, exchange default, failure to provide notices thereunder and provisions related to bankruptcy events. The indenture also contains customary negative covenants.

The Company was in compliance with the covenants relating to the 2017 Senior Notes as of December 31, 2019.

URS Senior Notes

In connection with the URS acquisition, the Company assumed the URS 3.85% Senior Notes due 2017 (2017 URS Senior Notes) and the URS 5.00% Senior Notes due 2022 (2022 URS Senior Notes), totaling $1.0 billion (URS Senior Notes). The URS acquisition triggered change in control provisions in the URS Senior Notes that allowed the holders of the URS Senior Notes to redeem their URS Senior Notes at a cash price equal to 101% of the principal amount and, accordingly, the Company redeemed $572.3 million of the URS Senior Notes on October 24, 2014. The remaining 2017 URS Senior Notes matured and were fully redeemed on April 3, 2017 for $179.2 million using proceeds from a $185 million delayed draw term loan A facility tranche under the Credit Agreement. The 2022 URS Senior Notes are general unsecured senior obligations of AECOM Global II, LLC as successor in interest to URS) and are fully and unconditionally guaranteed on a joint-and-several basis by some former URS domestic subsidiary guarantors.

As of December 31, 2019, the estimated fair value of the 2022 URS Senior Notes was approximately $256.9 million. The carrying value of the 2022 URS Senior Notes on the Company’s Consolidated Balance Sheets as of December 31, 2019 was $248.1 million. The fair value of the 2022 URS Senior Notes as of December 31, 2019 was derived by taking the mid-point of the trading prices from an observable market input (Level 2) in the secondary bond market and multiplying it by the outstanding balance of the 2022 URS Senior Notes.

As of December 31, 2019, the Company were in compliance with the covenants relating to the 2022 URS Senior Notes.

Other Debt and Other Items

Other debt consists primarily of obligations under capital leases and loans, and unsecured credit facilities. The Company’s unsecured credit facilities are primarily used for standby letters of credit issued in connection with general and professional liability insurance programs and for contract performance guarantees. At December 31, 2019 and September 30, 2019, these outstanding standby letters of credit totaled $476.5 million and $470.9 million, respectively. As of December 31, 2019, the Company had $401.6 million available under these unsecured credit facilities.

Effective Interest Rate

The Company’s average effective interest rate on its total debt, including the effects of the interest rate swap agreements, during the three months ended December 31, 2019 and 2018 was 4.9% and 5.1%, respectively.

Interest expense in the consolidated statements of operations included amortization of deferred debt issuance costs for the three months ended December 31, 2019 and 2018 of $1.3 million and $1.3 million, respectively.

Reportable Segments (Details) - USD ($) $ in Thousands	3 Months Ended
Reportable Segments (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019	Sep. 30, 2018
Summarized financial information concerning the Company's reportable segments
Revenue	$ 3,235,610	$ 3,356,338
Gross profit	165,800	123,396
Equity in earnings of joint ventures	9,928	6,632
General and administrative expenses	(43,614)	(35,907)
Restructuring costs	(44,925)	(63,295)
Operating income (loss)	87,189	$ 30,826
Total assets	$ 15,229,359		$ 14,461,591
Gross profit as a % of revenue	5.10%	3.70%
Total
Summarized financial information concerning the Company's reportable segments
Revenue	$ 3,235,600	$ 3,356,300
Gross profit	165,800	123,400
Equity in earnings of joint ventures	9,900	6,600
General and administrative expenses	(43,600)	(35,900)
Restructuring costs	(44,900)	(63,300)
Operating income (loss)	87,200	30,800
Total assets	15,229,400		$ 14,461,600
Corporate
Summarized financial information concerning the Company's reportable segments
General and administrative expenses	(41,200)	(34,200)
Restructuring costs	(44,900)	(63,300)
Operating income (loss)	(86,100)	(97,500)
Total assets	643,800			$ 607,000
Americas
Summarized financial information concerning the Company's reportable segments
Revenue	2,452,000	2,560,400
Gross profit	139,400	107,200
Equity in earnings of joint ventures	6,400	6,300
Operating income (loss)	145,800	$ 113,500
Total assets	$ 7,764,400			7,437,300
Gross profit as a % of revenue	5.70%	4.20%
International
Summarized financial information concerning the Company's reportable segments
Revenue	$ 783,100	$ 792,000
Gross profit	25,900	12,300
Equity in earnings of joint ventures	2,800	2,800
Operating income (loss)	28,700	$ 15,100
Total assets	$ 2,529,600			2,247,100
Gross profit as a % of revenue	3.30%	1.60%
AECOM Capital
Summarized financial information concerning the Company's reportable segments
Revenue	$ 500	$ 3,900
Gross profit	500	3,900
Equity in earnings of joint ventures	700	(2,500)
General and administrative expenses	(2,400)	(1,700)
Operating income (loss)	(1,200)	$ (300)
Total assets	$ 203,200			$ 197,800

Pension Benefit Obligations (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
United States
Components of net periodic benefit cost:
Interest cost on projected benefit obligation	$ 1.6	$ 2.2
Expected return on plan assets	(1.8)	(2.3)
Amortization of net loss	1.2	1.0
Net periodic benefit cost	1.0	0.9
Change in benefit obligation:
Employer contributions	2.4
Expected remaining scheduled annual employer contributions for the current fiscal year	7.1
Foreign Pension Plan, Defined Benefit
Components of net periodic benefit cost:
Service costs	0.2	0.1
Interest cost on projected benefit obligation	5.6	7.4
Expected return on plan assets	(9.4)	(9.5)
Amortization of net loss	2.1	1.0
Settlement loss recognized		0.1
Net periodic benefit cost	(1.5)	$ (0.9)
Change in benefit obligation:
Employer contributions	6.9
Expected remaining scheduled annual employer contributions for the current fiscal year	$ 20.8

New Accounting Pronouncements and Changes in Accounting (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Oct. 01, 2019	Sep. 30, 2019	Oct. 01, 2018
New Accounting Pronouncements and Changes in Accounting
Adjustment to retained earnings	$ 537,490		$ 599,548
Accounting Standards Update 2014-09
New Accounting Pronouncements and Changes in Accounting
Adjustment to retained earnings				$ (7,000)
Accounting Standards Update 2016-02
New Accounting Pronouncements and Changes in Accounting
Adjustment to retained earnings		$ (87,800)

Other Financial Information (Tables)

3 Months Ended

Dec. 31, 2019

Other Financial Information

Schedule of accrued expenses and other current liabilities


	December 31,		September 30,
	2019		2019
	(in millions)
Accrued salaries and benefits	$	869.1	$	1,020.7
Accrued contract costs		598.2		583.9
Other accrued expenses		470.0		273.7
	$	1,937.3	$	1,878.3

Discontinued Operations, Goodwill and Intangible Assets - Income statement information (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Discontinued Operations, Goodwill and Intangible Assets
Net income from discontinuing operations	$ 18,180	$ 28,165
Disposal Group as held for sale \| Management Services
Discontinued Operations, Goodwill and Intangible Assets
Revenue	1,502,800	1,681,200
Cost of revenue	1,473,500	1,634,000
Gross profit	29,300	47,200
Equity in earnings of joint ventures	4,900	5,900
Income from operations	34,200	53,100
Other income	1,200	600
Interest expense	(12,800)	(16,700)
Income before taxes	22,600	37,000
Income tax expense	4,400	8,800
Net income from discontinuing operations	$ 18,200	$ 28,200

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Dec. 31, 2019	Jan. 29, 2020
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Dec. 31, 2019
Document Transition Report	false
Entity File Number	0-52423
Entity Registrant Name	AECOM
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	61-1088522
Entity Address, Address Line One	1999 Avenue of the Stars, Suite 2600
Entity Address, City or Town	Los Angeles
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90067
City Area Code	213
Local Phone Number	593-8000
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	ACM
Security Exchange Name	NYSE
Entity Common Stock, Shares Outstanding		158,622,762
Entity Central Index Key	0000868857
Current Fiscal Year End Date	--09-30
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

Share-based Payments (Tables)

3 Months Ended

Dec. 31, 2019

Share-based Payments

Schedule of stock option activity


	2019			2018
	Shares of stock	Weighted average		Shares of stock	Weighted average
	under options	exercise price		under options	exercise price
	(in millions)			(in millions)
Outstanding at September 30	0.1	$	31.62	0.6	$	31.62
Options granted	—		—	—		—
Options exercised	—		—	—		—
Options forfeited or expired	—		—	—		—
Outstanding at December 31	0.1		31.62	0.6		31.62

Vested and expected to vest in the future as of December 31	0.1	$	31.62	0.6	$	31.62

Other Financial Information

3 Months Ended

Dec. 31, 2019

Other Financial Information

Other Financial Information

13. Other Financial Information

Accrued expenses and other current liabilities consist of the following:


	December 31,		September 30,
	2019		2019
	(in millions)
Accrued salaries and benefits	$	869.1	$	1,020.7
Accrued contract costs		598.2		583.9
Other accrued expenses		470.0		273.7
	$	1,937.3	$	1,878.3

Accrued contract costs above include balances related to professional liability accruals of $539.1 million and $536.6 million as of December 31, 2019 and September 30, 2019, respectively. The remaining accrued contract costs primarily relate to costs for services provided by subcontractors and other non-employees. Liabilities recorded related to accrued contract losses were not material as of December 31, 2019 and September 30, 2019. The Company did not have material revisions to estimates for contracts where revenue is recognized using the percentage-of-completion method during the three months ended December 31, 2019 and 2018. In the first quarter of fiscal 2019, the Company commenced a restructuring plan to improve profitability. The Company expects to incur restructuring costs of $160 million to $190 million in fiscal year 2020 primarily related to costs associated with the sale of the Management Services business and expected exit of self-perform at-risk construction in the civil infrastructure, power, and oil and gas businesses. During the first quarter of fiscal 2020, the Company incurred restructuring expenses of $44.9 million, including personnel and other costs of $38.2 million and real estate costs of $6.7 million, of which $16.7 million was accrued and unpaid at December 31, 2019. During the first quarter of fiscal 2019, the Company incurred restructuring expenses of $63.3 million, including personnel and other costs of $46.0 million and real estate costs of $17.3 million.

Condensed Consolidating Financial Information - Debt (Details)	Oct. 06, 2014
Condensed Consolidating Financial Information
Ownership of directly and indirectly owned subsidiaries (as a percent)	100.00%

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2019	Sep. 30, 2019
Consolidated Balance Sheets
Common stock, authorized shares	300,000,000	300,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, issued shares	158,192,180	157,482,983
Common stock, outstanding shares	158,192,180	157,482,983

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 53,094	$ 65,086
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	57,875	63,160
Equity in earnings of unconsolidated joint ventures	(14,800)	(12,504)
Distribution of earnings from unconsolidated joint ventures	16,867	13,955
Non-cash stock compensation	21,255	15,631
Foreign currency translation	16,077	(12,058)
Other	4,127	2,425
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable and contract assets	(129,001)	(86,271)
Prepaid expenses and other assets	(28,619)	(93,753)
Accounts payable	(91,375)	(101,459)
Accrued expenses and other current liabilities	(209,185)	(74,813)
Contract liabilities	90,620	76,471
Other long-term liabilities	6,135	(56,252)
Net cash used in operating activities	(206,930)	(200,382)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in unconsolidated joint ventures	(41,103)	(47,650)
Return of investment in unconsolidated joint ventures	3,516	9,273
Proceeds from sale of investments	500	3,805
Payments for purchase of investments		(3,223)
Proceeds from disposal of property and equipment	556	1,674
Payments for capital expenditures	(31,594)	(23,576)
Net cash used in investing activities	(68,125)	(59,697)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements	1,810,509	2,290,452
Repayments of borrowings under credit agreements	(1,694,733)	(1,999,140)
Proceeds from issuance of common stock	4,743	5,485
Payments to repurchase common stock	(38,510)	(52,347)
Net distributions to noncontrolling interests	(34,783)	(28,777)
Other financing activities	32,126	(2,439)
Net cash provided by financing activities	79,352	213,234
EFFECT OF EXCHANGE RATE CHANGES ON CASH	2,714	(1,586)
NET DECREASE IN CASH AND CASH EQUIVALENTS	(192,989)	(48,431)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	1,080,354	886,733
CASH AND CASH EQUIVALENTS AT END OF PERIOD	887,365	838,302
LESS CASH AND CASH EQUIVALENTS INCLUDED IN CURRENT ASSETS HELD FOR SALE	(161,929)	(152,051)
Total cash and cash equivalents	$ 725,436	$ 686,251

Basis of Presentation (Details) - USD ($) $ in Millions	3 Months Ended
Basis of Presentation (Details) - USD ($) $ in Millions	Dec. 31, 2019	Jan. 31, 2020
Minimum
Length of fiscal year	364 days
Maximum
Length of fiscal year	371 days
Disposal Group as held for sale \| Management Services
Total consideration		$ 2,405

Discontinued Operations, Goodwill and Intangible Assets (Tables)

3 Months Ended

Dec. 31, 2019

Discontinued Operations, Goodwill and Intangible Assets

Summarized results of the discontinued operation, included in the Company's results of operations

The following table represents summarized balance sheet information of assets and liabilities held for sale (in millions):


	December 31,		September 30,
	2019		2019

Cash and cash equivalents	$	161.9	$	194.7
Receivables and contract assets		1,391.1		1,326.6
Other		88.9		112.0
Current assets held for sale	$	1,641.9	$	1,633.3

Property and equipment, net	$	155.5	$	153.8
Goodwill		1,815.1		1,798.5
Other		475.8		386.8
Non-current assets held for sale	$	2,446.4	$	2,339.1

Accounts payable and accrued expenses	$	922.5	$	1,056.0
Contract liabilities		77.5		88.9
Other		22.2		18.8
Current liabilities held for sale	$	1,022.2	$	1,163.7

Long term liabilities held for sale	$	269.6	$	219.6

The following table represents summarized income statement information of discontinued operations (in millions):


	Three months ended
	December 31,		December 31,
	2019		2018

Revenue	$	1,502.8	$	1,681.2
Cost of revenue		1,473.5		1,634.0
Gross profit		29.3		47.2
Equity in earnings of joint ventures		4.9		5.9
Income from operations		34.2		53.1
Other income		1.2		0.6
Interest expense		(12.8)		(16.7)
Income before taxes		22.6		37.0
Income tax expense		4.4		8.8
Net income from discontinuing operations	$	18.2	$	28.2

The significant components included in our Consolidated Statement of Cash Flows for the discontinued operations are as follows (in millions):


	Three months ended
	December 31,		December 31,
	2019		2018

Depreciation and amortization:
Property and equipment	$	4.6	$	7.7
Intangible assets and capitalized debt issuance costs	$	12.8	$	16.5
Payments for capital expenditures	$	(8.2)	$	(4.2)

Schedule of carrying value of goodwill by reportable segment


			Foreign
	September 30,		Exchange		December 31,
	2019		Impact		2019
	(in millions)
Americas	$	2,623.0	$	2.5	$	2,625.5
International		853.8		12.8		866.6
Total	$	3,476.8	$	15.3	$	3,492.1

Schedule of finite-lived intangible assets by major class


	December 31, 2019						September 30, 2019
	Gross		Accumulated		Intangible		Gross		Accumulated		Intangible		Amortization
	Amount		Amortization		Assets, Net		Amount		Amortization		Assets, Net		Period
	(in millions)												(years)
Backlog and customer relationships	$	662.2	$	(567.9)	$	94.3	$	661.4	$	(561.8)	$	99.6	1	-	11

Schedule of estimated future amortization expense of intangible assets


Fiscal Year	(in millions)
2020 (nine months remaining)	$	17.6
2021		20.4
2022		19.5
2023		18.6
2024		17.5
Thereafter		0.7
Total	$	94.3

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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+ Details

Leases (Tables)

3 Months Ended

Dec. 31, 2019

Leases

Schedule of components of lease expenses


	Three Months Ended
	December 31, 2019
	(in millions)
Operating lease cost	$	46.6
Finance lease cost
Amortization of right-of-use assets		4.7
Interest on lease liabilities		0.5
Variable lease cost		9.6
Short-term lease cost		3.4
Total lease cost	$	64.8

Schedule of additional balance sheet information related to leases


		As of
(in millions except as noted)	Balance Sheet Classification	Dec 31, 2019
Assets:
Operating lease assets	Operating lease right-of-use assets	$	647.4
Finance lease assets	Property and equipment – net		50.6
Total lease assets		$	698.0

Liabilities:
Current:
Operating lease liabilities	Accrued expenses and other current liabilities	$	173.2
Finance lease liabilities	Current portion of long-term debt		18.4
Total current lease liabilities			191.6
Non-current:
Operating lease liabilities	Operating lease liabilities, noncurrent		745.0
Finance lease liabilities	Long-term debt		40.7
Total non-current lease liabilities		$	785.7


	As of Dec 31, 2019
Weighted average remaining lease term (in years):
Operating leases	7.3
Finance leases	3.2
Weighted average discount rates:
Operating leases	4.6	%
Finance leases	4.2	%

Schedule of additional cash flow information related to leases


	Three Months Ended
	December 31, 2019
	(in millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	55.8
Operating cash flows from finance leases		0.5
Financing cash flows from finance leases		4.2
Right-of-use assets obtained in exchange for new operating leases		9.4
Right-of-use assets obtained in exchange for new finance leases		7.2

Schedule of total remaining lease payments under the Company's operating and Finance leases


	Operating Leases		Finance Leases
Fiscal Year	(in millions)
2020 (nine months remaining)	$	162.2	$	14.9
2021		185.3		18.5
2022		155.3		15.9
2023		123.0		10.0
2024		99.8		3.2
Thereafter		359.9		0.7
Total lease payments	$	1,085.5	$	63.2
Less: Amounts representing interest	$	(167.3)	$	(4.1)
Total lease liabilities	$	918.2	$	59.1

Income Taxes

3 Months Ended

Dec. 31, 2019

Income Taxes

Income Taxes

10. Income Taxes

The Company's effective tax rate was 31.3% and 758.9% for the three months ended December 31, 2019 and 2018, respectively. The most significant items contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate for the three month period ended December 31, 2019 were tax expense of $5.6 million related to nondeductible costs, tax expense of $4.0 million related to foreign residual income, and tax expense of $2.8 million related to state income taxes. These items of tax expense were partially offset by a tax benefit of $7.4 million related to income tax credits and incentives. All of these items are expected to have a continuing impact on the effective tax rate for the remainder of the fiscal year.

The most significant item contributing to the difference between the statutory U.S. federal income tax rate of 21.0% and the Company’s effective tax rate for the three month period ended December 31, 2018,was a $38.1 million benefit related to the release of a valuation allowance on foreign tax credits.

During the first quarter of fiscal 2019, a valuation allowance in the amount of $38.1 million related to foreign tax credits was released due to sufficient positive evidence obtained during the quarter. The positive evidence included the issuance of regulations during the quarter related to The Tax Cuts and Jobs Act (Tax Act) and forecasting the utilization of the foreign tax credits within the foreseeable future. The Company evaluated the new positive evidence against any negative evidence to determine the valuation allowance was no longer needed.

The Company is utilizing the annual effective tax rate method under ASC 740 to compute its interim tax provision. The Company’s effective tax rate fluctuates from quarter to quarter due to various factors including the change in the mix of global income and expenses, outcomes of administrative audits, changes in the assessment of valuation allowances due to management’s consideration of new positive or negative evidence during the quarter, and changes in enacted tax laws and their interpretations which upon enactment include possible tax reform around the world arising from the result of the base erosion and profit shifting project undertaken by the Organisation for Economic Co-

operation Development which, if finalized and adopted, could have a material impact on the Company’s income tax expense and deferred tax balances.

The Company is currently under tax audit in several jurisdictions including the U.S. and believes the outcomes which are reasonably possible within the next twelve months, including lapses in statutes of limitations, could result in future adjustments, but will not result in a material change in the liability for uncertain tax positions.

Generally, the Company does not provide for U.S. taxes or foreign withholding taxes on gross book-tax differences in its non-U.S. subsidiaries because such basis differences of approximately $1.7 billion are able to and intended to be reinvested indefinitely. If these basis differences were distributed, foreign tax credits could become available under current law to partially or fully reduce the resulting U.S. income tax liability. There may also be additional U.S. or foreign income tax liability upon repatriation, although the calculation of such additional taxes is not practicable.

Revenue Recognition (Tables)

3 Months Ended

Dec. 31, 2019

Revenue Recognition

Schedule of revenues disaggregated by revenue sources


	Three months ended
	December 31,		December 31,
	2019		2018
	(in millions)
Cost reimbursable	$	1,394.4	$	1,429.0
Guaranteed maximum price		947.5		1,030.3
Fixed price		893.7		897.0
Total revenue	$	3,235.6	$	3,356.3


	Three months ended
	December 31,		December 31,
	2019		2018
	(in millions)
Americas	$	2,452.5	$	2,564.3
Europe, Middle East, Africa		429.6		430.3
Asia Pacific		353.5		361.7
Total revenue	$	3,235.6	$	3,356.3

Schedule of net accounts receivable


	December 31,		September 30,
	2019		2019
	(in millions)
Billed	$	2,285.6	$	2,284.8
Contract retentions		621.5		641.5
Total accounts receivable—gross		2,907.1		2,926.3
Allowance for doubtful accounts		(67.4)		(57.1)
Total accounts receivable—net	$	2,839.7	$	2,869.2

Share-based Payments

3 Months Ended

Dec. 31, 2019

Share-based Payments

Share-based Payments

9. Share-based Payments

The fair value of the Company’s employee stock option awards is estimated on the date of grant. The expected term of awards granted represents the period of time the awards are expected to be outstanding. The risk-free interest rate is based on U.S. Treasury bond rates with maturities equal to the expected term of the stock option on the grant date. The Company uses historical data as a basis to estimate the probability of forfeitures.

Stock option activity for the three months ended December 31 was as follows:


	2019			2018
	Shares of stock	Weighted average		Shares of stock	Weighted average
	under options	exercise price		under options	exercise price
	(in millions)			(in millions)
Outstanding at September 30	0.1	$	31.62	0.6	$	31.62
Options granted	—		—	—		—
Options exercised	—		—	—		—
Options forfeited or expired	—		—	—		—
Outstanding at December 31	0.1		31.62	0.6		31.62

Vested and expected to vest in the future as of December 31	0.1	$	31.62	0.6	$	31.62

The Company grants stock units to employees under its Performance Earnings Program (PEP), whereby units are earned and issued dependent upon meeting established cumulative performance objectives and vest over a three-year service period. Additionally, the Company issues restricted stock units to employees which are earned based on service conditions. The grant date fair value of PEP awards and restricted stock unit awards is that day’s closing market price of the Company’s common stock. The weighted average grant date fair value of PEP awards was $43.06 and $27.50 during the three months ended December 31, 2019 and 2018, respectively. The weighted average grant date fair value of restricted stock unit awards was $43.06 and $27.50 during the three months ended December 31, 2019 and 2018, respectively. Total compensation expense related to these share-based payments including stock options was $21.3 million and $15.6 million during the three months ended December 31, 2019 and 2018, respectively. Unrecognized compensation expense related to total share-based payments outstanding as of December 31, 2019 and September 30, 2019 was $80.8 million and $74.6 million, respectively, to be recognized on a straight-line basis over the awards’ respective vesting periods which are generally three years.

Commitments and Contingencies

3 Months Ended

Dec. 31, 2019

Commitments and Contingencies

Commitments and Contingencies

15. Commitments and Contingencies

The Company records amounts representing its probable estimated liabilities relating to claims, guarantees, litigation, audits and investigations. The Company relies in part on qualified actuaries to assist it in determining the level of reserves to establish for insurance-related claims that are known and have been asserted against it, and for insurance-related claims that are believed to have been incurred based on actuarial analysis, but have not yet been reported to the Company’s claims administrators as of the respective balance sheet dates. The Company includes any adjustments to such insurance reserves in its consolidated results of operations. The Company’s reasonably possible loss disclosures are presented on a gross basis prior to the consideration of insurance recoveries. The Company does not record gain contingencies until they are realized. In the ordinary course of business, the Company may not be aware that it or its affiliates are under investigation and may not be aware of whether or not a known investigation has been concluded.

In the ordinary course of business, the Company may enter into various arrangements providing financial or performance assurance to clients, lenders, or partners. Such arrangements include standby letters of credit, surety bonds, and corporate guarantees to support the creditworthiness or the project execution commitments of its affiliates, partnerships and joint ventures. Performance arrangements typically have various expiration dates ranging from the completion of the project contract and extending beyond contract completion in some circumstances such as for warranties. The Company may also guarantee that a project, when complete, will achieve specified performance standards. If the project subsequently fails to meet guaranteed performance standards, the Company may incur additional costs, pay liquidated damages or be held responsible for the costs incurred by the client to achieve the required performance standards. The potential payment amount of an outstanding performance arrangement is typically the remaining cost of work to be performed by or on behalf of third parties. Generally, under joint venture arrangements, if a partner is financially unable to complete its share of the contract, the other partner(s) may be required to complete those activities.

At December 31, 2019, the Company was contingently liable in the amount of approximately $499.3 million in issued standby letters of credit and $4.8 billion in issued surety bonds primarily to support project execution.

In the ordinary course of business, the Company enters into various agreements providing financial or performance assurances to clients on behalf of certain unconsolidated partnerships, joint ventures and other jointly executed contracts. These agreements are entered into primarily to support the project execution commitments of these entities.

The Company’s investment adviser jointly manages, sponsors and owns equity interest in the AECOM-Canyon Equity Fund, L.P. (the “Fund”), in which the Company has an ongoing capital commitment to fund investments. At December 31, 2019, the Company has capital commitments of $35 million to the Fund over the next 10 years.

In addition, in connection with the investment activities of AECOM Capital, the Company provides guarantees of contractual obligations, including guarantees for completion of projects, repayment of debt, environmental indemnity obligations and other lender required guarantees.

Department of Energy Deactivation, Demolition, and Removal Project

A former affiliate of the Company executed a cost-reimbursable task order with the Department of Energy (DOE) in 2007 to provide deactivation, demolition and removal services at a New York State project site that, during 2010, experienced contamination and performance issues and remains uncompleted. In February 2011, the Company’s former affiliate and the DOE executed a Task Order Modification that changed some cost-reimbursable contract provisions to at-risk. The Task Order Modification, including subsequent amendments, required the DOE to pay all project costs up to $106 million, required the Company's former affiliate and the DOE to equally share in all project costs incurred from $106 million to $146 million, and required the Company's former affiliate to pay all project costs exceeding $146 million.

Due to unanticipated requirements and permitting delays by federal and state agencies, as well as delays and related ground stabilization activities caused by Hurricane Irene in 2011, the Company’s former affiliate was required to perform work outside the scope of the Task Order Modification. In December 2014, the Company’s former affiliate submitted an initial set of claims against the DOE pursuant to the Contracts Disputes Acts seeking recovery of $103 million, including additional fees on changed work scope (the 2014 Claims). On December 6, 2019, the Company’s former affiliate submitted a second set of claims against the DOE seeking recovery of an additional $60.4 million, including additional project costs and delays outside the scope of the contract as a result of differing site and ground conditions (the “2019 Claims”). The Company’s former affiliate also submitted three alternative breach of contract claims to the 2014 and 2019 Claims that may entitle the Company’s former affiliate to recovery of $148.5 million to $329.4 million. On December 30, 2019, the DOE denied the Company’s former affiliate’s 2014 Claims.

Due to significant delays and uncertainties about responsibilities for the scope of remaining work, final project completion costs and other associated costs have exceeded $100 million over the contracted and claimed amounts. The Company’s former affiliate’s assets and liabilities, including the value of the above costs and claims, were measured at their fair value on October 17, 2014, the date the Company acquired the former affiliate’s parent company, which measurement has been reevaluated to account for developments pertaining to this matter. Deconstruction, decommissioning and site restoration activities are complete. On January 31, 2020, the Company’s former affiliate was acquired as part of the Management Services sale; however, the Company will control all strategic legal decisions and receive 90% of any future recoveries associated with this matter

The Company intends to vigorously pursue all claimed amounts but can provide no certainty that the Company will recover 2014 and 2019 Claims submitted against the DOE, or any additional incurred claims or costs, which could have a material adverse effect on the Company’s results of operations.

New York Department of Environmental Conservation

The following separate matters pertain to government environmental allegations against one of the Company’s wholly-owned subsidiaries, AECOM USA, Inc.

●

In September 2017, AECOM USA, Inc. was advised by the New York State Department of Environmental Conservation (DEC) of allegations that it committed environmental permit violations pursuant to the New York Environmental Conservation Law (ECL) associated with AECOM USA, Inc.’s oversight of a stream restoration project for Schoharie County which could result in substantial penalties if calculated under the ECL’s maximum civil penalty provisions. AECOM USA, Inc. disputes this claim and intends to continue to defend this matter vigorously; however, AECOM USA, Inc. cannot provide assurances that it will be successful in these efforts. The potential range of loss in excess of any current accrual cannot be reasonably estimated at this time primarily because the matter involves complex and unique environmental and regulatory issues; the project site involves the oversight and involvement of various local, state and federal government agencies; there is substantial uncertainty regarding any alleged damages; and the matter is in its preliminary stage of the government’s claims and any negotiations of a consent order or other resolution.

●

In December 2018, AECOM USA, Inc. was advised by DEC of allegations that, during AECOM USA, Inc.’s oversight of a remedial construction project in Poughkeepsie, New York, sheen escaped a containment boom line near the east bank of the Hudson River without proper notification to DEC and an unapproved dispersant was sprayed onto the Hudson River to control odors in violation of ECL. AECOM USA, Inc. denied these allegations. Without admission of liability, on December 12, 2019, AECOM USA, Inc. resolved this matter through a consent order for $0.1 million.

Refinery Turnaround Project

A former affiliate of the Company entered into an agreement to perform turnaround maintenance services during a planned shutdown at a refinery in Montana in December 2017. The turnaround project was completed in February 2019. Due to circumstances outside of the Company’s former affiliate’s control, including client directed changes and delays and the refinery’s condition, The Company’s former affiliate performed additional work outside of the original contract over $90 million and is entitled to payment from the refinery owner of approximately $144 million. In March 2019, the refinery owner sent a letter to the Company’s former affiliate alleging it incurred approximately $79 million in damages due to the Company’s former affiliate’s project performance. In April 2019, the Company’s former affiliate filed and perfected a $132 million construction lien against the refinery owner for unpaid labor and materials costs. In August 2019, following a subcontractor complaint filed in the Thirteen Judicial District Court of Montana asserting claims against the refinery owner and the Company’s former affiliate, the refinery owner crossclaimed against the Company’s former affiliate and the subcontractor. In October 2019, following the subcontractor’s dismissal of its claims, the Company’s former affiliate removed the matter to federal court and cross claimed against the refinery owner. In December 2019, the refinery owner claimed $93.0 million in damages and offsets against the Company’s former affiliate.

The Company intends to vigorously prosecute and defend this matter; however, the Company cannot provide assurance that the Company will be successful in these efforts. The resolution of this matter and any potential range of loss cannot be reasonably determined or estimated at this time, primarily because the matter raises complex legal issues that Company is continuing to assess.

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Consolidated Statements of Operations
Revenue	$ 3,235,610	$ 3,356,338
Cost of revenue	3,069,810	3,232,942
Gross profit	165,800	123,396
Equity in earnings of joint ventures	9,928	6,632
General and administrative expenses	(43,614)	(35,907)
Restructuring costs	(44,925)	(63,295)
Income from operations	87,189	30,826
Other income	4,008	2,985
Interest expense	(40,377)	(39,425)
Income (loss) from continuing operations before taxes	50,820	(5,614)
Income tax expense (benefit) for continuing operations	15,906	(42,535)
Net income from continuing operations	34,914	36,921
Net income from discontinued operations	18,180	28,165
Net income	53,094	65,086
Net income attributable to noncontrolling interests from continuing operations	(4,047)	(4,940)
Net income attributable to noncontrolling interests from discontinued operations	(8,443)	(8,627)
Net income attributable to noncontrolling interests	(12,490)	(13,567)
Net income attributable to AECOM from continuing operations	30,867	31,981
Net income attributable to AECOM from discontinued operations	9,737	19,538
Net income attributable to AECOM	$ 40,604	$ 51,519
Net income attributable to AECOM per share:
Basic continuing operations per share	$ 0.20	$ 0.20
Basic discontinued operations per share	0.06	0.12
Basic earnings per share	0.26	0.32
Diluted continuing operations per share	0.19	0.20
Diluted discontinued operations per share	0.06	0.12
Diluted earnings per share	$ 0.25	$ 0.32
Weighted average shares outstanding:
Basic (in shares)	157,332	156,416
Diluted (in shares)	160,657	159,603

Debt - 2014 Senior Notes (Details) - USD ($)	Mar. 16, 2018	Oct. 06, 2014	Dec. 31, 2019
The 2022 Notes
Debt
Redemption price equal to principal amount (in percent)	104.313%
Prepayment premium redemption	$ 34,500,000
2014 Senior Notes \| The 2022 Notes
Debt
Principal amount		$ 800,000,000
Interest rate (as a percent)		5.75%
2014 Senior Notes \| The 2024 Notes
Debt
Principal amount		$ 800,000,000
Interest rate (as a percent)		5.875%
Fair value of debt instrument			$ 886,000,000.0
2014 Senior Notes \| The 2024 Notes \| Prior to July 15 2024
Debt
Redemption price equal to principal amount (in percent)		100.00%
2014 Senior Notes \| The 2024 Notes \| On or after July 15, 2024
Debt
Redemption price equal to principal amount (in percent)		100.00%

Commitments and Contingencies (Details) - USD ($) $ in Millions		1 Months Ended		3 Months Ended	72 Months Ended
	Dec. 06, 2019	Dec. 31, 2019	Dec. 31, 2014	Dec. 31, 2019	Sep. 30, 2019	Dec. 12, 2019	Apr. 30, 2019	Mar. 31, 2019
AECOM USA, Inc.
Commitments and Contingencies
Consent order						$ 0.1
Department of Energy Deactivation, Demolition, And Removal Project \| Department of Energy \| Maximum
Commitments and Contingencies
Cost-reimbursement at risk		$ 106.0		$ 106.0
Department of Energy Deactivation, Demolition, And Removal Project \| AECOM E&C and DOE \| Minimum
Commitments and Contingencies
Cost-reimbursement at risk		106.0		106.0
Department of Energy Deactivation, Demolition, And Removal Project \| AECOM E&C and DOE \| Maximum
Commitments and Contingencies
Cost-reimbursement at risk		146.0		146.0
Department of Energy Deactivation, Demolition, And Removal Project \| AECOM E&C
Commitments and Contingencies
Claim to DOE, including additional fees	$ 60.4		$ 103.0
Possible costs which may exceed contracted amounts			$ 100.0
Department of Energy Deactivation, Demolition, And Removal Project \| AECOM E&C \| Minimum
Commitments and Contingencies
Cost-reimbursement at risk		146.0		146.0
Claim to DOE, including additional fees					$ 148.5
Department of Energy Deactivation, Demolition, And Removal Project \| AECOM E&C \| Maximum
Commitments and Contingencies
Claim to DOE, including additional fees					$ 329.4
Refinery Turnaround Project
Commitments and Contingencies
Damages paid, value		93.0
Refinery Turnaround Project \| AECOM E&C
Commitments and Contingencies
Damages claimed, value				144.0
Recoverable from refinery owner				90.0
Loss contingency, receivable amount							$ 132.0	$ 79.0
AECOM-Canyon Equity Fund, L.P
Commitments and Contingencies
Capital commitments				$ 35.0
Term of capital commitments				10 years
Standby letter of credit
Commitments and Contingencies
Contingency liability		$ 499.3		$ 499.3
Surety Bond
Commitments and Contingencies
Surety bonds issued				$ 4,800.0

Leases - Additional cash flow information (Details) $ in Millions	3 Months Ended
	Dec. 31, 2019 USD ($)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 55.8
Operating cash flows from finance leases	0.5
Financing cash flows from finance leases	4.2
Right-of-use assets obtained in exchange for new operating leases	9.4
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability	$ 7.2

Leases

3 Months Ended

Dec. 31, 2019

Leases

Leases

12. Leases

On October 1, 2019, the Company adopted FASB ASC 842 on a modified retrospective basis, which amended the accounting standards for leases. Accordingly, the Company applied the new guidance as of the date of adoption with a cumulative-effect adjustment recorded through equity. Prior periods have not been restated as a result of the adoption. Retained earnings decreased $87.8 million due to the adoption, primarily from impairment of the right-of-use assets associated with office building leases. Consistent with its restructuring plan to improve profitability in the fourth quarter of fiscal 2019, the Company evaluated its real estate portfolio to better align with the ongoing business. The Company identified leased assets that were not recoverable, and recorded an adjustment to retained earnings upon adoption reflecting the impairment of those long-lived leased assets. Fair value of the right-of-use assets was determined primarily using Level 3 inputs, such as discounted cash flows.

The Company also applied transition elections that allow it to avoid reassessment of whether expired or expiring leases are or contain leases, lease classification, and initial direct costs. Adoption of the new lease guidance did not significantly change the Company’s accounting for finance leases, which were previously referred to as capital leases.

The Company and its subsidiaries are lessees in non-cancelable leasing agreements for office buildings and equipment. Substantially all of the Company’s office building leases are operating leases, and its equipment leases are both operating and finance leases. The Company groups lease and non-lease components for its equipment leases into a single lease component but separates lease and non-lease components for its office building leases.

The Company recognizes a right-of-use asset and lease liability for its operating leases at the commencement date equal to the present value of the contractual minimum lease payments over the lease term. The present value is calculated using the rate implicit in the lease, if known, or the Company’s incremental secured borrowing rate. The discount rate used for operating leases is primarily determined based on an analysis the Company’s incremental secured borrowing rate, while the discount rate used for finance leases is primarily determined by the rate specified in the lease.

The related lease payments are expensed on a straight-line basis over the lease term, including, as applicable, any free-rent period during which the Company has the right to use the asset. For leases with renewal options where the renewal is reasonably assured, the lease term, including the renewal period, is used to determine the appropriate lease classification and to compute periodic rental expense. Leases with initial terms shorter than 12 months are not recognized on the balance sheet, and lease expense is recognized on a straight-line basis.

The components of lease expenses are as follows:


	Three Months Ended
	December 31, 2019
	(in millions)
Operating lease cost	$	46.6
Finance lease cost
Amortization of right-of-use assets		4.7
Interest on lease liabilities		0.5
Variable lease cost		9.6
Short-term lease cost		3.4
Total lease cost	$	64.8

Additional balance sheet information related to leases is as follows:


		As of
(in millions except as noted)	Balance Sheet Classification	Dec 31, 2019
Assets:
Operating lease assets	Operating lease right-of-use assets	$	647.4
Finance lease assets	Property and equipment – net		50.6
Total lease assets		$	698.0

Liabilities:
Current:
Operating lease liabilities	Accrued expenses and other current liabilities	$	173.2
Finance lease liabilities	Current portion of long-term debt		18.4
Total current lease liabilities			191.6
Non-current:
Operating lease liabilities	Operating lease liabilities, noncurrent		745.0
Finance lease liabilities	Long-term debt		40.7
Total non-current lease liabilities		$	785.7


	As of Dec 31, 2019
Weighted average remaining lease term (in years):
Operating leases	7.3
Finance leases	3.2
Weighted average discount rates:
Operating leases	4.6	%
Finance leases	4.2	%

Additional cash flow information related to leases is as follows:


	Three Months Ended
	December 31, 2019
	(in millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	55.8
Operating cash flows from finance leases		0.5
Financing cash flows from finance leases		4.2
Right-of-use assets obtained in exchange for new operating leases		9.4
Right-of-use assets obtained in exchange for new finance leases		7.2

Total remaining lease payments under both the Company’s operating and finance leases are as follows:


	Operating Leases		Finance Leases
Fiscal Year	(in millions)
2020 (nine months remaining)	$	162.2	$	14.9
2021		185.3		18.5
2022		155.3		15.9
2023		123.0		10.0
2024		99.8		3.2
Thereafter		359.9		0.7
Total lease payments	$	1,085.5	$	63.2
Less: Amounts representing interest	$	(167.3)	$	(4.1)
Total lease liabilities	$	918.2	$	59.1

Debt - URS Senior Notes (Details) - USD ($) $ in Millions	Oct. 24, 2014	Dec. 31, 2019	Sep. 30, 2019	Apr. 03, 2017	Feb. 21, 2017	Sep. 29, 2016	Oct. 17, 2014
Debt
Debt		$ 3,503.9	$ 3,352.5
Term loan A
Debt
Amount of debt redeemed					$ 600.0
Borrowing capacity						$ 185.0
URS Senior Notes
Debt
Debt		248.1	$ 248.1				$ 1,000.0
Redemption price equal to principal using proceeds from equity offerings (in percent)	101.00%
Amount of debt redeemed	$ 572.3
URS Senior Notes \| 2017 URS Senior Notes
Debt
Interest rate (as a percent)							3.85%
Amount of debt redeemed				$ 179.2
URS Senior Notes \| 2022 URS Senior Notes
Debt
Interest rate (as a percent)							5.00%
Debt		248.1
Fair value of debt instrument		$ 256.9

Pension Benefit Obligations (Tables)

3 Months Ended

Dec. 31, 2019

Pension Benefit Obligations

Components of net periodic cost for the Company's pension and post-retirement plans


	Three Months Ended
	December 31, 2019				December 31, 2018
	U.S.		Int’l		U.S.		Int’l
	(in millions)
Components of net periodic benefit cost:
Service costs	$	—	$	0.2	$	—	$	0.1
Interest cost on projected benefit obligation		1.6		5.6		2.2		7.4
Expected return on plan assets		(1.8)		(9.4)		(2.3)		(9.5)
Amortization of net loss		1.2		2.1		1.0		1.0
Settlement loss recognized		—		—		—		0.1
Net periodic benefit cost	$	1.0	$	(1.5)	$	0.9	$	(0.9)

New Accounting Pronouncements and Changes in Accounting

3 Months Ended

Dec. 31, 2019

New Accounting Pronouncements and Changes in Accounting

New Accounting Pronouncements and Changes in Accounting

2. New Accounting Pronouncements and Changes in Accounting

In May 2014, the Financial Accounting Standards Board (FASB) issued new accounting guidance which amended the existing accounting standards for revenue recognition. The new accounting guidance establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The Company adopted the new standard on October 1, 2018, using the modified retrospective method, which resulted in an adjustment to retained earnings of $7.0 million, net of tax. Detailed disclosures regarding the adoption and other required disclosures can be found in Note 4.

In February 2016, the FASB issued new accounting guidance which changes accounting requirements for leases. The new guidance requires lessees to recognize the assets and liabilities arising from all leases, including those classified as operating leases under previous accounting guidance, on the balance sheet. It also requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. The Company adopted the new guidance beginning October 1, 2019 using the modified retrospective adoption method, which resulted

in an adjustment to retained earnings of $87.8 million, net of tax. Detailed disclosures regarding the adoption and other required disclosures can be found in Note 12.

In June 2016, the FASB issued a new credit loss standard that changes the impairment model for most financial assets and some other instruments. The new guidance will replace the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. It also simplifies the accounting model for purchased credit-impaired debt securities and loans. The guidance will be effective for the Company’s fiscal year starting October 1, 2020. The Company is currently evaluating the impact that the new guidance will have on its consolidated financial statements.

In February 2018, the FASB issued new accounting guidance which provides entities the option to reclassify certain tax effects from other comprehensive income to retained earnings. The guidance addresses a narrow-scope financial reporting issue related to the tax effects that may become stranded in accumulated other comprehensive income as a result of the enactment of the Tax Cuts and Jobs Act. Under the guidance, an entity may elect to reclassify the income tax effects of the Tax Act on items within accumulated other comprehensive income to retained earnings. The Company has determined that it will not make this election.

In August 2018, the FASB issued new accounting guidance aligning the capitalization of certain implementation costs incurred in a hosting arrangement that is a service contract with previously existing guidance for capitalizing costs incurred to develop internal-use software. The new guidance will be effective for the Company’s fiscal year starting October 1, 2020. The Company does not expect that the adoption of this guidance will have a material impact on its consolidated financial statements.

In August 2018, the FASB issued new accounting guidance amending the disclosure requirements for fair value measurements. These improvements will require more disclosure for amounts measured at fair value, and specifically unobservable inputs used in fair value measurements. The Company expects to adopt the new guidance starting on October 1, 2020. The Company is currently evaluating the impact that the new guidance will have on its financial reporting process.

Revenue Recognition

3 Months Ended

Dec. 31, 2019

Revenue Recognition

Revenue Recognition

4. Revenue Recognition

On October 1, 2018, the Company adopted FASB Accounting Standards Codification (ASC) 606 on a modified retrospective basis, which amended the accounting standards for revenue recognition. As a result, the new guidance was applied retrospectively to contracts which were not completed as of October 1, 2018. Contracts completed prior to October 1, 2018 were accounted for using the guidance in effect at that time. The cumulative effect of applying the new guidance was recorded as a reduction to retained earnings at October 1, 2018 of $7.0 million, net of tax. Consistent with the modified retrospective transition approach, the comparative period was not adjusted to conform with current period presentation. The adjustment was primarily related to segmenting or combining contracts by performance obligations identified under the criteria of the new standard.

The new accounting guidance establishes principles for recognizing revenue upon the transfer of control of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The Company generally recognizes revenues over time as performance obligations are satisfied. The Company generally measures its progress to completion using an input measure of total costs incurred divided by total costs expected to be incurred. In the course of providing its services, the Company routinely subcontracts for services and incurs other direct costs on behalf of its clients. These costs are passed through to clients and, in accordance with GAAP, are included in the Company’s revenue and cost of revenue. These subcontractor and other direct costs for the three months ended December 31, 2019 and 2018 were $1.7 million and $1.8 million, respectively.

Recognition of revenue and profit is dependent upon a number of factors, including the accuracy of a variety of estimates made at the balance sheet date, such as engineering progress, material quantities, the achievement of milestones, penalty provisions, labor productivity and cost estimates. Additionally, the Company is required to make estimates for the amount of consideration to be received, including bonuses, awards, incentive fees, claims, unpriced change orders, penalties, and liquidated damages. Variable consideration is included in the estimate of the transaction price only to the extent that a significant reversal would not be probable. Management continuously monitors factors that may affect the quality of its estimates, and material changes in estimates are disclosed accordingly.

The following summarizes the Company’s major contract types:

Cost Reimbursable Contracts

Cost reimbursable contracts include cost-plus fixed fee, cost-plus fixed rate, and time-and-materials price contracts. Under cost-plus contracts, the Company charges clients for its costs, including both direct and indirect costs, plus a negotiated fee or rate. The Company recognizes revenue based on actual direct costs incurred and the applicable fixed rate or portion of the fixed fee earned as of the balance sheet date. Under time-and-materials price contracts, the Company negotiates hourly billing rates and charges its clients based on the actual time that it expends on a project. In addition, clients reimburse the Company for materials and other direct incidental expenditures incurred in connection with its performance under the contract. The Company may apply a practical expedient to recognize revenue in the amount in which it has the right to invoice if its right to consideration is equal to the value of performance completed to date.

Guaranteed Maximum Price Contracts (GMP)

GMP contracts share many of the same contract provisions as cost-plus and fixed-price contracts. As with cost-plus contracts, clients are provided a disclosure of all the project costs, and a lump sum or percentage fee is separately identified. The Company provides clients with a guaranteed price for the overall project (adjusted for change orders issued by clients) and a schedule including the expected completion date. Cost overruns or costs associated with project delays in completion could generally be the Company’s responsibility. For many of the Company’s commercial or residential GMP contracts, the final price is generally not established until the Company has subcontracted a substantial percentage of the trade contracts with terms consistent with the master contract, and it has negotiated additional contractual limitations, such as waivers of consequential damages as well as aggregate caps on liabilities and liquidated damages. Revenue is recognized for GMP contracts as project costs are incurred relative to total estimated project costs.

Fixed-Price Contracts

Fixed price contracts include both lump-sum and fixed-unit price contracts. Under lump-sum contracts, the Company performs all the work under the contract for a specified fee. Lump-sum contracts are typically subject to price adjustments if the scope of the project changes or unforeseen conditions arise. Under fixed-unit price contracts, the Company performs a number of units of work at an agreed price per unit with the total payment under the contract determined by the actual number of units delivered. Revenue is recognized for fixed-price contracts using the input method measured on a cost-to-cost basis.

The following tables present the Company’s revenues disaggregated by revenue sources:


	Three months ended
	December 31,		December 31,
	2019		2018
	(in millions)
Cost reimbursable	$	1,394.4	$	1,429.0
Guaranteed maximum price		947.5		1,030.3
Fixed price		893.7		897.0
Total revenue	$	3,235.6	$	3,356.3


	Three months ended
	December 31,		December 31,
	2019		2018
	(in millions)
Americas	$	2,452.5	$	2,564.3
Europe, Middle East, Africa		429.6		430.3
Asia Pacific		353.5		361.7
Total revenue	$	3,235.6	$	3,356.3

As of December 31, 2019, the Company had allocated $17.1 billion of transaction price to unsatisfied or partially satisfied performance obligations, of which approximately 60% is expected to be satisfied within the next twelve months.

The Company’s timing of revenue recognition may not be consistent with its rights to bill and collect cash from its clients. Those rights are generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of work or when services are performed. The Company’s accounts receivable represent amounts billed to clients that have yet to be collected and represent an unconditional right to cash from its clients. Contract assets represent the amount of contract revenue recognized but not yet billed pursuant to contract terms or accounts billed after the balance sheet date. Contract liabilities represent billings as of the balance sheet date, as allowed under the terms of a contract, but not yet recognized as contract revenue pursuant to the Company’s revenue recognition policy.

Net accounts receivable consisted of the following:


	December 31,		September 30,
	2019		2019
	(in millions)
Billed	$	2,285.6	$	2,284.8
Contract retentions		621.5		641.5
Total accounts receivable—gross		2,907.1		2,926.3
Allowance for doubtful accounts		(67.4)		(57.1)
Total accounts receivable—net	$	2,839.7	$	2,869.2

Substantially all contract assets as of December 31, 2019 and September 30, 2019 are expected to be billed and collected within twelve months, except for claims. Significant claims recorded in contract assets and other non-current assets were approximately $110 million and $110 million as of December 31 , 2019 and September 30, 2019, respectively. Contract retentions represent amounts invoiced to clients where payments have been withheld from progress payments until the contracted work has been completed and approved by the client. These retention agreements vary from project to project and could be outstanding for several months or years.

Allowances for doubtful accounts have been determined through specific identification of amounts considered to be uncollectible and potential write-offs, plus a non-specific allowance for other amounts for which some potential loss has been determined to be probable based on current and past experience.

Other than the U.S. government, no single client accounted for more than 10% of the Company’s outstanding receivables at December 31, 2019 and September 30, 2019.

The Company sold trade receivables to financial institutions, of which $100.8 million and $91.9 million were outstanding as of December 31, 2019 and September 30, 2019, respectively. The Company does not retain financial or legal obligations for these receivables that would result in material losses. The Company’s ongoing involvement is limited to the remittance of customer payments to the financial institutions with respect to the sold trade receivables.

Debt - 2017 Senior Notes (Details) - USD ($)	Feb. 21, 2017	Dec. 31, 2019
Term loan B
Debt
Amount of debt redeemed	$ 127,600,000
Term loan A
Debt
Amount of debt redeemed	600,000,000
Revolving credit facility
Debt
Amount of debt redeemed	250,000,000
2017 Senior Notes
Debt
Principal amount	$ 1,000,000,000
Fair value of debt instrument		$ 1,075,000,000.0
Interest rate (as a percent)	5.125%
2017 Senior Notes \| At any time and from time to time prior to December 15, 2026
Debt
Redemption price equal to principal amount (in percent)	100.00%
2017 Senior Notes \| At any time and from time to time prior to March 15, 2020
Debt
Maximum principal amount that can be redeemed using proceeds from equity offerings(in percent)	35.00%
Redemption price equal to principal using proceeds from equity offerings (in percent)	105.125%
2017 Senior Notes \| At any time on or after December 15, 2026
Debt
Redemption price equal to principal amount (in percent)	100.00%

Discontinued Operations, Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Sep. 30, 2019
Discontinued Operations, Goodwill and Intangible Assets
Amortization expense	$ 6,100	$ 6,300
Estimated amortization expense for the succeeding years
2020 (nine months remaining)	17,600
2021	20,400
2022	19,500
2023	18,600
2024	17,500
Thereafter	700
Intangible Assets, Net	$ 94,274		$ 99,636

Debt (Tables)

3 Months Ended

Dec. 31, 2019

Debt

Schedule of debt


	December 31,		September 30,
	2019		2019
	(in millions)
2014 Credit Agreement	$	1,323.2	$	1,182.2
2014 Senior Notes		800.0		800.0
2017 Senior Notes		1,000.0		1,000.0
URS Senior Notes		248.1		248.1
Other debt		132.6		122.2
Total debt		3,503.9		3,352.5
Less: Current portion of debt and short-term borrowings		(111.6)		(98.3)
Less: Unamortized debt issuance costs		(34.1)		(36.2)
Long-term debt	$	3,358.2	$	3,218.0

Schedule of maturities of debt


Fiscal Year
2020 (nine months remaining)	$	104.2
2021		199.1
2022		301.8
2023		578.0
2024		9.7
Thereafter		2,311.1
Total	$	3,503.9

Debt - 2014 Credit Agreement (Details) $ in Millions, $ in Millions, $ in Millions							3 Months Ended
	Oct. 01, 2019	Jul. 01, 2018	Mar. 13, 2018 USD ($)	Mar. 31, 2017	Sep. 29, 2016 USD ($)	Oct. 17, 2014 USD ($)	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Mar. 31, 2018 USD ($)	Mar. 13, 2018 AUD ($)	Mar. 13, 2018 CAD ($)
Term loan A
Debt agreements
Borrowing capacity					$ 185.0
2014 Credit Agreement \| Minimum \| Base Rate
Debt agreements
Interest rate, basis spread (as a percent)		0.25%
2014 Credit Agreement \| Minimum \| Euro currency rate
Debt agreements
Interest rate, basis spread (as a percent)		1.25%
2014 Credit Agreement \| Maximum \| Base Rate
Debt agreements
Interest rate, basis spread (as a percent)		1.00%
2014 Credit Agreement \| Maximum \| Euro currency rate
Debt agreements
Interest rate, basis spread (as a percent)		2.00%
2014 Credit Agreement \| Term loan A
Debt agreements
Borrowing capacity			$ 510.0							$ 250	$ 500
2014 Credit Agreement \| Term loan A \| Base Rate \| USD
Debt agreements
Interest rate, basis spread (as a percent)			0.50%
2014 Credit Agreement \| Term loan A \| Euro currency rate
Debt agreements
Interest rate, basis spread (as a percent)			1.50%
2014 Credit Agreement \| Term loan B
Debt agreements
Borrowing capacity			$ 600.0						$ 600.0
2014 Credit Agreement \| Term loan B \| CAD
Debt agreements
Borrowing capacity									$ 500.0
2014 Credit Agreement \| Term loan B \| Base Rate
Debt agreements
Interest rate, basis spread (as a percent)			0.75%
2014 Credit Agreement \| Term loan B \| Euro currency rate
Debt agreements
Interest rate, basis spread (as a percent)			1.75%
2014 Credit Agreement \| Revolving credit facility
Debt agreements
Increase in borrowing capacity			$ 1,350.0			$ 1,050.0
Outstanding letters of credit							$ 22.8	$ 22.8
Remaining borrowing capacity under credit facility							$ 1,193.5	$ 1,327.2
2014 Credit Agreement \| Revolving credit facility \| Base Rate
Debt agreements
Interest rate, basis spread (as a percent)			0.75%
2014 Credit Agreement \| Revolving credit facility \| Euro currency rate
Debt agreements
Interest rate, basis spread (as a percent)			1.75%
2014 Credit Agreement \| Line of credit
Debt agreements
Borrowing capacity					$ 500.0
Consolidated leverage ratio	4.0		4.5	4.75	5.00		3.6
Consolidated interest coverage ratio							4.9

Joint Ventures and Variable Interest Entities (Tables)

3 Months Ended

Dec. 31, 2019

Joint Ventures and Variable Interest Entities

Summary of financial information of the consolidated joint ventures


	December 31,
	2019		September 30,
	(unaudited)		2019
	(in millions)
Current assets	$	541.9	$	581.3
Non-current assets		77.2		75.4
Total assets	$	619.1	$	656.7

Current liabilities	$	412.6	$	432.8
Non-current liabilities		1.0		—
Total liabilities		413.6		432.8
Total AECOM equity		119.2		137.9
Noncontrolling interests		86.3		86.0
Total owners’ equity		205.5		223.9
Total liabilities and owners’ equity	$	619.1	$	656.7

Summary of financial information of the unconsolidated joint ventures, as derived from their unaudited financial statements


	December 31,		September 30,
	2019		2019
	(in millions)
Current assets	$	1,193.0	$	1,133.5
Non-current assets		946.0		904.5
Total assets	$	2,139.0	$	2,038.0

Current liabilities	$	1,137.7	$	1,115.5
Non-current liabilities		121.8		182.3
Total liabilities		1,259.5		1,297.8
Joint ventures’ equity		879.5		740.2
Total liabilities and joint ventures’ equity	$	2,139.0	$	2,038.0

AECOM’s investment in joint ventures	$	279.3	$	256.1


	Three Months Ended
	December 31,		December 31,
	2019		2018
	(in millions)
Revenue	$	765.1	$	765.4
Cost of revenue		746.0		740.0
Gross profit	$	19.1	$	25.4
Net income	$	18.2	$	24.1

Summary of AECOM's equity in earnings of unconsolidated joint ventures


	Three Months Ended
	December 31,		December 31,
	2019		2018
	(in millions)
Pass through joint ventures	$	9.2	$	9.1
Other joint ventures		0.7		(2.5)
Total	$	9.9	$	6.6

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total AECOM Stockholders' Equity	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Retained Earnings	Non-Controlling Interests	Total
BALANCE at Sep. 30, 2018	$ 4,092,780	$ 1,570	$ 3,846,392	$ (703,330)	$ 948,148	$ 185,594	$ 4,278,374
Increase (Decrease) in Stockholders' Equity
Net income	51,519				51,519	13,567	65,086
Other comprehensive loss	(22,815)			(22,815)		58	(22,757)
Issuance of stock	5,485	24	5,461				5,485
Repurchases of stock	(52,347)	(24)	(22,339)		(29,984)		(52,347)
Stock based compensation	15,631		15,631				15,631
Other transactions with noncontrolling interests						2,187	2,187
Contributions from noncontrolling interests						3,150	3,150
Distributions to noncontrolling interests						(31,927)	(31,927)
BALANCE at Dec. 31, 2018	4,077,800	1,570	3,845,145	(726,145)	957,230	172,629	4,250,429
Increase (Decrease) in Stockholders' Equity
Cumulative effect of accounting standard adoption	(12,453)				(12,453)		(12,453)
BALANCE at Sep. 30, 2019	3,690,576	1,575	3,953,650	(864,197)	599,548	208,774	3,899,350
Increase (Decrease) in Stockholders' Equity
Net income	40,604				40,604	12,490	53,094
Other comprehensive loss	41,531			41,531		107	41,638
Issuance of stock	5,333	17	5,316				5,333
Repurchases of stock	(38,510)	(10)	(23,625)		(14,875)		(38,510)
Stock based compensation	21,255		21,255				21,255
Other transactions with noncontrolling interests						(186)	(186)
Contributions from noncontrolling interests						2,813	2,813
Distributions to noncontrolling interests						(37,596)	(37,596)
BALANCE at Dec. 31, 2019	3,673,002	$ 1,582	$ 3,956,596	$ (822,666)	537,490	$ 186,402	3,859,404
Increase (Decrease) in Stockholders' Equity
Cumulative effect of accounting standard adoption	$ (87,787)				$ (87,787)		$ (87,787)

Discontinued Operations, Goodwill and Intangible Assets - Balance sheet information of assets and liabilities held for sale (Details) - USD ($) $ in Thousands	Jan. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Dec. 31, 2018
Summary of financial information of the Disposal Group is as follows:
Cash and cash equivalents		$ 161,929		$ 152,051
Non-current assets held for sale		2,446,381	$ 2,339,054
Long term liabilities held for sale		269,604	219,558
Disposal Group as held for sale \| Management Services
Discontinued Operations, Goodwill and Intangible Assets
Total consideration	$ 2,405,000
Contingent consideration, prior work claims	$ 150,000
Summary of financial information of the Disposal Group is as follows:
Cash and cash equivalents		161,900	194,700
Receivables and contract assets		1,391,100	1,326,600
Other		88,900	112,000
Current assets held for sale		1,641,900	1,633,300
Property and equipment, net		155,500	153,800
Goodwill		1,815,100	1,798,500
Other		475,800	386,800
Non-current assets held for sale		2,446,400	2,339,100
Accounts payable and accrued expenses		922,500	1,056,000
Contract liabilities		77,500	88,900
Other		22,200	18,800
Current liabilities held for sale		1,022,200	1,163,700
Long term liabilities held for sale		$ 269,600	$ 219,600

Earnings Per Share (Tables)

3 Months Ended

Dec. 31, 2019

Earnings Per Share

Reconciliation of the denominators for basic and diluted EPS


	Three Months Ended
	December 31,	December 31,
	2019	2018
	(in millions)
Denominator for basic earnings per share	157.3	156.4
Potential common shares	3.4	3.2
Denominator for diluted earnings per share	160.7	159.6

Discontinued Operations, Goodwill and Intangible Assets - Significant components included in our Consolidated Statement of Cash Flows (Details) - Disposal Group as held for sale - Management Services - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Depreciation and amortization:
Property and equipment	$ 4.6	$ 7.7
Intangible assets and capitalized debt issuance costs	12.8	16.5
Payments for capital expenditures	$ (8.2)	$ (4.2)

Condensed Consolidating Financial Information - Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Condensed Consolidating Statements of Operations
Revenue	$ 3,235,610	$ 3,356,338
Cost of revenue	3,069,810	3,232,942
Gross profit	165,800	123,396
Equity in earnings of joint ventures	9,928	6,632
General and administrative expenses	(43,614)	(35,907)
Restructuring costs	(44,925)	(63,295)
Income from operations	87,189	30,826
Other income	4,008	2,985
Interest expense	(40,377)	(39,425)
Income (loss) from continuing operations before taxes	50,820	(5,614)
Income tax expense (benefit) for continuing operations	15,906	(42,535)
Net income from continuing operations	34,914	36,921
Net income from discontinued operations	18,180	28,165
Net income	53,094	65,086
Net income attributable to noncontrolling interests from continuing operations	(4,047)	(4,940)
Net income attributable to noncontrolling interests from discontinued operations	(8,443)	(8,627)
Net income attributable to noncontrolling interests	(12,490)	(13,567)
Net income attributable to AECOM from continuing operations	30,867	31,981
Net income attributable to AECOM from discontinued operations	9,737	19,538
Net income attributable to AECOM	40,604	51,519
Eliminations
Condensed Consolidating Statements of Operations
Revenue	(15,400)	(20,900)
Cost of revenue	(15,400)	(20,900)
Equity in earnings from subsidiaries	(243,500)	(101,100)
Income from operations	(243,500)	(101,100)
Other income	(13,600)	(13,300)
Interest expense	13,600	13,300
Income (loss) from continuing operations before taxes	(243,500)	(101,100)
Net income from continuing operations	(243,500)	(101,100)
Net income	(243,500)	(101,100)
Net income attributable to AECOM from continuing operations	(243,500)	(101,100)
Net income attributable to AECOM	(243,500)	(101,100)
Parent \| Reportable Legal Entities
Condensed Consolidating Statements of Operations
Equity in earnings from subsidiaries	182,400	153,500
General and administrative expenses	(41,200)	(34,200)
Restructuring costs	(44,900)	(63,300)
Income from operations	96,300	56,000
Other income	100	1,200
Interest expense	(39,000)	(39,200)
Income (loss) from continuing operations before taxes	57,400	18,000
Income tax expense (benefit) for continuing operations	9,700	(41,200)
Net income from continuing operations	47,700	59,200
Net income from discontinued operations	(7,100)	(7,800)
Net income	40,600	51,400
Net income attributable to AECOM from continuing operations	47,700	59,200
Net income attributable to AECOM from discontinued operations	(7,100)	(7,800)
Net income attributable to AECOM	40,600	51,400
Guarantor Subsidiaries \| Reportable Legal Entities
Condensed Consolidating Statements of Operations
Revenue	1,755,600	1,802,300
Cost of revenue	1,695,600	1,727,000
Gross profit	60,000	75,300
Equity in earnings from subsidiaries	61,100	(52,400)
Equity in earnings of joint ventures	5,600	7,900
Income from operations	126,700	30,800
Other income	11,700	11,300
Interest expense	(6,800)	(5,000)
Income (loss) from continuing operations before taxes	131,600	37,100
Income tax expense (benefit) for continuing operations	(1,100)	(1,300)
Net income from continuing operations	132,700	38,400
Net income from discontinued operations	50,000	22,400
Net income	182,700	60,800
Net income attributable to AECOM from continuing operations	132,700	38,400
Net income attributable to AECOM from discontinued operations	50,000	22,400
Net income attributable to AECOM	182,700	60,800
Non-Guarantor Subsidiaries \| Reportable Legal Entities
Condensed Consolidating Statements of Operations
Revenue	1,495,400	1,574,900
Cost of revenue	1,389,600	1,526,800
Gross profit	105,800	48,100
Equity in earnings of joint ventures	4,300	(1,300)
General and administrative expenses	(2,400)	(1,700)
Income from operations	107,700	45,100
Other income	5,800	3,800
Interest expense	(8,200)	(8,500)
Income (loss) from continuing operations before taxes	105,300	40,400
Income tax expense (benefit) for continuing operations	7,300
Net income from continuing operations	98,000	40,400
Net income from discontinued operations	(24,700)	13,600
Net income	73,300	54,000
Net income attributable to noncontrolling interests from continuing operations	(4,000)	(5,000)
Net income attributable to noncontrolling interests from discontinued operations	(8,500)	(8,600)
Net income attributable to noncontrolling interests	(12,500)	(13,600)
Net income attributable to AECOM from continuing operations	94,000	35,400
Net income attributable to AECOM from discontinued operations	(33,200)	5,000
Net income attributable to AECOM	60,800	40,400
Total
Condensed Consolidating Statements of Operations
Revenue	3,235,600	3,356,300
Cost of revenue	3,069,800	3,232,900
Gross profit	165,800	123,400
Equity in earnings of joint ventures	9,900	6,600
General and administrative expenses	(43,600)	(35,900)
Restructuring costs	(44,900)	(63,300)
Income from operations	87,200	30,800
Other income	4,000	3,000
Interest expense	(40,400)	(39,400)
Income (loss) from continuing operations before taxes	50,800	(5,600)
Income tax expense (benefit) for continuing operations	15,900	(42,500)
Net income from continuing operations	34,900	36,900
Net income from discontinued operations	18,200	28,200
Net income	53,100	65,100
Net income attributable to noncontrolling interests from continuing operations	(4,000)	(5,000)
Net income attributable to noncontrolling interests from discontinued operations	(8,500)	(8,600)
Net income attributable to noncontrolling interests	(12,500)	(13,600)
Net income attributable to AECOM from continuing operations	30,900	31,900
Net income attributable to AECOM from discontinued operations	9,700	19,600
Net income attributable to AECOM	$ 40,600	$ 51,500

Derivative Financial Instruments and Fair Value Measurements - Fair Value Measurements (Details) $ in Millions	3 Months Ended
	Dec. 31, 2019 USD ($)
Designated as Hedging Instrument \| Cash Flow Hedging \| Interest rate swap agreements
Derivative financial instruments
Losses Recognized in Income on Derivatives (Amount Excluded from Effectiveness Testing and Ineffective Portion)	$ 0

Reportable Segments (Tables)

3 Months Ended

Dec. 31, 2019

Reportable Segments

Summarized financial information concerning the Company's reportable segments


							AECOM
Reportable Segments:	Americas			International			Capital		Corporate		Total
	(in millions)
Three Months Ended December 31, 2019:
Revenue	$	2,452.0		$	783.1		$	0.5	$	—	$	3,235.6
Gross profit		139.4			25.9			0.5		—		165.8
Equity in earnings of joint ventures		6.4			2.8			0.7		—		9.9
General and administrative expenses		—			—			(2.4)		(41.2)		(43.6)
Restructuring costs		—			—			—		(44.9)		(44.9)
Operating income (loss)		145.8			28.7			(1.2)		(86.1)		87.2
Gross profit as a % of revenue		5.7	%		3.3	%		—		—		5.1	%

Three Months Ended December 31, 2018:
Revenue	$	2,560.4		$	792.0		$	3.9	$	—	$	3,356.3
Gross profit		107.2			12.3			3.9		—		123.4
Equity in earnings (losses) of joint ventures		6.3			2.8			(2.5)		—		6.6
General and administrative expenses		—			—			(1.7)		(34.2)		(35.9)
Restructuring costs		—			—			—		(63.3)		(63.3)
Operating income (loss)		113.5			15.1			(0.3)		(97.5)		30.8
Gross profit as a % of revenue		4.2	%		1.6	%		—		—		3.7	%


Reportable Segments:
Total assets
December 31,2019	$	7,764.4	$	2,529.6	$	203.2	$	643.8
September 30, 2019		7,437.3		2,247.1		197.8		607.0

Joint Ventures and Variable Interest Entities - Consolidated (Details) $ in Thousands	3 Months Ended
	Dec. 31, 2019 USD ($) employee	Dec. 31, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)
Financial Information
Minimum number of employees \| employee	0
Current assets	$ 7,466,933		$ 7,534,645
TOTAL ASSETS	15,229,359		14,461,591
Current liabilities	6,461,458		6,461,754
TOTAL LIABILITIES	11,369,955		10,562,241
Total AECOM equity	3,673,002		3,690,576
Noncontrolling interests	186,402		208,774
TOTAL STOCKHOLDERS' EQUITY	3,859,404	$ 4,250,429	3,899,350	$ 4,278,374
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	15,229,359		14,461,591
Joint ventures summarized financial information
Revenue	3,235,610	3,356,338
Consolidated Joint Ventures
Financial Information
Current assets	541,900		581,300
Non-current assets	77,200		75,400
TOTAL ASSETS	619,100		656,700
Current liabilities	412,600		432,800
Non-current liabilities	1,000
TOTAL LIABILITIES	413,600		432,800
Total AECOM equity	119,200		137,900
Noncontrolling interests	86,300		86,000
TOTAL STOCKHOLDERS' EQUITY	205,500		223,900
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	619,100		$ 656,700
Joint ventures summarized financial information
Revenue	$ 220,600	$ 291,700

Debt - Other Debt and Other Items (Details) - Other Debt - Standby letter of credit - USD ($) $ in Millions	Dec. 31, 2019	Sep. 30, 2019
Debt
Outstanding letters of credit	$ 476.5	$ 470.9
Remaining borrowing capacity under credit facility	$ 401.6

Discontinued Operations, Goodwill and Intangible Assets

3 Months Ended

Dec. 31, 2019

Discontinued Operations, Goodwill and Intangible Assets

Discontinued Operations, Goodwill and Intangible Assets

3. Discontinued Operations, Goodwill and Intangible Assets

On October 12, 2019, the Company entered into a purchase and sale agreement with Maverick Purchaser Sub, LLC (Purchaser), an affiliate of American Securities LLC and Lindsay Goldberg LLC. Upon the terms of that agreement, the Company agreed to transfer the asset and liabilities constituting its Management Services business to the Purchaser for a purchase price of $2.405 billion, subject to customary cash, debt, and working capital adjustments. The purchase price includes contingent consideration of approximately $150 million attributable to certain claims related to prior work and engagements. The transaction with the Purchaser closed on January 31, 2020.

Additionally, in the first quarter of fiscal 2020, management approved a plan to dispose via sale the Company’s self-perform at-risk construction businesses within the next year. These businesses include the Company’s civil infrastructure, power, and oil and gas construction businesses that were previously reported in the Company’s Construction Services segment. After consideration of the relevant facts, the Company concluded the assets and liabilities of its Management Services business and its self-perform at-risk construction businesses met the criteria for classification as held for sale. Additionally, the Company concluded the proposed disposal activities represented a strategic shift that will have a major effect on the Company’s operations and financial results and qualified for presentation as discontinued operations in accordance with ASC 205-20. Accordingly, the financial results of the Management Services business and the self-perform at-risk construction businesses are presented in the Consolidated Statement of Operations as discontinued operations for all periods presented. Current and non-current assets and liabilities of these businesses are presented in the Consolidated Balance Sheet as assets and liabilities held for sale for both periods presented. Interest expense allocated to discontinued operations represents interest expenses for the discontinued operations’ finance leases and term loans, which are required to be settled upon the sale of the Management Services business.

The following table represents summarized balance sheet information of assets and liabilities held for sale (in millions):


	December 31,		September 30,
	2019		2019

Cash and cash equivalents	$	161.9	$	194.7
Receivables and contract assets		1,391.1		1,326.6
Other		88.9		112.0
Current assets held for sale	$	1,641.9	$	1,633.3

Property and equipment, net	$	155.5	$	153.8
Goodwill		1,815.1		1,798.5
Other		475.8		386.8
Non-current assets held for sale	$	2,446.4	$	2,339.1

Accounts payable and accrued expenses	$	922.5	$	1,056.0
Contract liabilities		77.5		88.9
Other		22.2		18.8
Current liabilities held for sale	$	1,022.2	$	1,163.7

Long term liabilities held for sale	$	269.6	$	219.6

The following table represents summarized income statement information of discontinued operations (in millions):


	Three months ended
	December 31,		December 31,
	2019		2018

Revenue	$	1,502.8	$	1,681.2
Cost of revenue		1,473.5		1,634.0
Gross profit		29.3		47.2
Equity in earnings of joint ventures		4.9		5.9
Income from operations		34.2		53.1
Other income		1.2		0.6
Interest expense		(12.8)		(16.7)
Income before taxes		22.6		37.0
Income tax expense		4.4		8.8
Net income from discontinuing operations	$	18.2	$	28.2

The significant components included in our Consolidated Statement of Cash Flows for the discontinued operations are as follows (in millions):


	Three months ended
	December 31,		December 31,
	2019		2018

Depreciation and amortization:
Property and equipment	$	4.6	$	7.7
Intangible assets and capitalized debt issuance costs	$	12.8	$	16.5
Payments for capital expenditures	$	(8.2)	$	(4.2)

The changes in the carrying value of goodwill by reportable segment for the three months ended December 31, 2019 were as follows:


			Foreign
	September 30,		Exchange		December 31,
	2019		Impact		2019
	(in millions)
Americas	$	2,623.0	$	2.5	$	2,625.5
International		853.8		12.8		866.6
Total	$	3,476.8	$	15.3	$	3,492.1

The gross amounts and accumulated amortization of the Company’s acquired identifiable intangible assets with finite useful lives as of December 31 and September 30, 2019, included in intangible assets—net, in the accompanying consolidated balance sheets, were as follows:


	December 31, 2019						September 30, 2019
	Gross		Accumulated		Intangible		Gross		Accumulated		Intangible		Amortization
	Amount		Amortization		Assets, Net		Amount		Amortization		Assets, Net		Period
	(in millions)												(years)
Backlog and customer relationships	$	662.2	$	(567.9)	$	94.3	$	661.4	$	(561.8)	$	99.6	1	-	11

Amortization expense of acquired intangible assets included within cost of revenue was $6.1 million and $6.3 million for the three months ended December 31, 2019 and 2018, respectively. The following table presents estimated amortization expense of existing intangible assets for the remainder of fiscal 2020 and for the succeeding years:


Fiscal Year	(in millions)
2020 (nine months remaining)	$	17.6
2021		20.4
2022		19.5
2023		18.6
2024		17.5
Thereafter		0.7
Total	$	94.3

Condensed Consolidating Financial Information (Tables)

3 Months Ended

Dec. 31, 2019

Condensed Consolidating Financial Information

Schedule of Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets

(unaudited - in millions)

December 31, 2019


			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
ASSETS
CURRENT ASSETS:
Total cash and cash equivalents	$	2.1	$	251.3	$	472.0	$	-	$	725.4
Accounts receivable and contract assets - net		-		1,935.4		2,575.9		-		4,511.3
Intercompany receivable		1,138.7		183.0		277.1		(1,598.8)		-
Prepaid expenses and other current assets		76.7		172.8		282.8		-		532.3
Current assets held for sale		-		840.9		801.0		-		1,641.9
Income taxes receivable		52.8		-		3.2		-		56.0
TOTAL CURRENT ASSETS		1,270.3		3,383.4		4,412.0		(1,598.8)		7,466.9
PROPERTY AND EQUIPMENT—NET		189.9		122.9		91.1		-		403.9
DEFERRED TAX ASSETS—NET		152.9		98.6		76.5		(98.8)		229.2
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES		6,094.8		1,663.0		-		(7,757.8)		-
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES		11.3		18.2		249.8		-		279.3
GOODWILL		-		2,217.9		1,274.2		-		3,492.1
INTANGIBLE ASSETS—NET		-		81.6		12.7		-		94.3
OTHER NON-CURRENT ASSETS		29.3		37.9		102.7		-		169.9
OPERATING LEASE RIGHT-OF-USE ASSETS		24.3		366.4		256.7		-		647.4
NON-CURRENT ASSETS HELD FOR SALE		-		1,219.5		1,226.9		-		2,446.4
TOTAL ASSETS	$	7,772.8	$	9,209.4	$	7,702.6	$	(9,455.4)	$	15,229.4

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	22.3	$	2.6	$	30.1	$	-	$	55.0
Accounts payable		114.6		1,577.0		685.3		-		2,376.9
Accrued expenses and other current liabilities		79.8		633.2		1,224.4		-		1,937.4
Income taxes payable		22.2		-		38.2		-		60.4
Intercompany payable		188.9		903.7		652.8		(1,745.4)		-
Contract liabilities		-		309.1		643.9		-		953.0
Current liabilities held for sale		-		562.2		460.0		-		1,022.2
Current portion of long-term debt		13.1		4.8		38.7		-		56.6
TOTAL CURRENT LIABILITIES		440.9		3,992.6		3,773.4		(1,745.4)		6,461.5
OTHER LONG-TERM LIABILITIES		94.6		69.5		346.4		-		510.5
OPERATING LEASE LIABILITIES		96.8		414.0		234.2		-		745.0
LONG-TERM LIABILITIES HELD FOR SALE		-		195.1		74.5		-		269.6
DEFERRED TAX LIABILITY—NET		-		-		124.0		(98.8)		25.2
NOTE PAYABLE INTERCOMPANY—NON CURRENT		877.0		-		472.5		(1,349.5)		-
LONG-TERM DEBT		2,607.7		270.8		479.7		-		3,358.2
TOTAL LIABILITIES		4,117.0		4,942.0		5,504.7		(3,193.7)		11,370.0
TOTAL AECOM STOCKHOLDERS’ EQUITY		3,655.8		4,267.4		2,011.5		(6,261.7)		3,673.0
Noncontrolling interests		-		-		186.4		-		186.4
TOTAL STOCKHOLDERS’ EQUITY		3,655.8		4,267.4		2,197.9		(6,261.7)		3,859.4
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,772.8	$	9,209.4	$	7,702.6	$	(9,455.4)	$	15,229.4

Condensed Consolidating Balance Sheets

(in millions)

September 30, 2019


			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
ASSETS
CURRENT ASSETS:
Total cash and cash equivalents	$	129.3	$	273.4	$	482.9	$	—	$	885.6
Accounts receivable and contract assets—net		—		2,023.3		2,427.7		—		4,451.0
Intercompany receivable		1,164.7		163.9		176.0		(1,504.6)		—
Prepaid expenses and other current assets		52.5		174.5		288.6		—		515.6
Current assets held for sale		—		766.3		867.0		—		1,633.3
Income taxes receivable		13.7		—		35.4		—		49.1
TOTAL CURRENT ASSETS		1,360.2		3,401.4		4,277.6		(1,504.6)		7,534.6
PROPERTY AND EQUIPMENT—NET		193.0		126.0		86.6		—		405.6
DEFERRED TAX ASSETS—NET		152.8		45.6		74.4		(95.2)		177.6
INVESTMENTS IN CONSOLIDATED SUBSIDIARIES		5,740.8		1,611.2		—		(7,352.0)		—
INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES		9.9		12.4		233.8		—		256.1
GOODWILL		—		2,226.4		1,250.4		—		3,476.8
INTANGIBLE ASSETS—NET		—		85.7		13.9		—		99.6
OTHER NON-CURRENT ASSETS		33.1		38.3		100.8		—		172.2
NON-CURRENT ASSETS HELD FOR SALE		—		1,141.1		1,198.0		—		2,339.1
TOTAL ASSETS	$	7,489.8	$	8,688.1	$	7,235.5	$	(8,951.8)	$	14,461.6

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	21.8	$	—	$	26.0	$	—	$	47.8
Accounts payable		50.2		1,650.5		710.1		—		2,410.8
Accrued expenses and other current liabilities		108.0		678.5		1,091.8		—		1,878.3
Income taxes payable		23.6		—		36.1		—		59.7
Intercompany payable		116.1		873.9		649.5		(1,639.5)		—
Contract liabilities		—		299.7		551.3		—		851.0
Current liabilities held for sale		—		658.1		505.6		—		1,163.7
Current portion of long-term debt		12.6		5.0		32.9		—		50.5
TOTAL CURRENT LIABILITIES		332.3		4,165.7		3,603.3		(1,639.5)		6,461.8
OTHER LONG-TERM LIABILITIES		130.7		158.7		369.1		—		658.5
LONG-TERM LIABILITIES HELD FOR SALE		—		158.8		60.8		—		219.6
DEFERRED TAX LIABILITY—NET		—		—		99.5		(95.2)		4.3
NOTE PAYABLE INTERCOMPANY—NON CURRENT		872.6		—		467.5		(1,340.1)		—
LONG-TERM DEBT		2,468.9		260.8		488.3		—		3,218.0
TOTAL LIABILITIES		3,804.5		4,744.0		5,088.5		(3,074.8)		10,562.2
TOTAL AECOM STOCKHOLDERS’ EQUITY		3,685.3		3,944.1		1,938.2		(5,877.0)		3,690.6
Noncontrolling interests		—		—		208.8		—		208.8
TOTAL STOCKHOLDERS’ EQUITY		3,685.3		3,944.1		2,147.0		(5,877.0)		3,899.4
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,489.8	$	8,688.1	$	7,235.5	$	(8,951.8)	$	14,461.6

Schedule of Condensed Consolidating Statements of Operations

Condensed Consolidating Statements of Operations

(unaudited - in millions)


	For the Three Months Ended December 31, 2019
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Revenue	$	—	$	1,755.6	$	1,495.4	$	(15.4)	$	3,235.6
Cost of Revenue		—		1,695.6		1,389.6		(15.4)		3,069.8
Gross Profit		—		60.0		105.8		—		165.8
Equity in earnings from subsidiaries		182.4		61.1		—		(243.5)		—
Equity in earnings of joint ventures		—		5.6		4.3		—		9.9
General and administrative expenses		(41.2)		—		(2.4)		—		(43.6)
Restructuring costs		(44.9)		—		—		—		(44.9)
Income from operations		96.3		126.7		107.7		(243.5)		87.2
Other income		0.1		11.7		5.8		(13.6)		4.0
Interest expense		(39.0)		(6.8)		(8.2)		13.6		(40.4)
Income from continuing operations before income taxes		57.4		131.6		105.3		(243.5)		50.8
Income tax expense (benefit) for continuing operations		9.7		(1.1)		7.3		—		15.9

Net income from continuing operations		47.7		132.7		98.0		(243.5)		34.9
Net income from discontinued operations		(7.1)		50.0		(24.7)		—		18.2
Net income		40.6		182.7		73.3		(243.5)		53.1

Net income attributable to noncontrolling interest from continuing operations		—		—		(4.0)		—		(4.0)
Net income attributable to noncontrolling interest from discontinued operations		—		—		(8.5)		—		(8.5)
Net income attributable to noncontrolling interest		—		—		(12.5)		—		(12.5)

Net income attributable to AECOM from continuing operations		47.7		132.7		94.0		(243.5)		30.9
Net income attributable to AECOM from discontinued operations		(7.1)		50.0		(33.2)		—		9.7
Net income attributable to AECOM	$	40.6	$	182.7	$	60.8	$	(243.5)	$	40.6


	For the three months ended December 31, 2018
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Revenue	$	—	$	1,802.3	$	1,574.9	$	(20.9)	$	3,356.3
Cost of revenue		—		1,727.0		1,526.8		(20.9)		3,232.9
Gross profit		—		75.3		48.1		—		123.4
Equity in earnings from subsidiaries		153.5		(52.4)		—		(101.1)		—
Equity in earnings of joint ventures		—		7.9		(1.3)		—		6.6
General and administrative expenses		(34.2)		—		(1.7)		—		(35.9)
Restructuring costs		(63.3)		—		—		—		(63.3)
Income from operations		56.0		30.8		45.1		(101.1)		30.8
Other income		1.2		11.3		3.8		(13.3)		3.0
Interest expense		(39.2)		(5.0)		(8.5)		13.3		(39.4)
Income from continuing operations before taxes		18.0		37.1		40.4		(101.1)		(5.6)
Income tax benefit for continuing operations		(41.2)		(1.3)		—		—		(42.5)
Net income from continuing operations		59.2		38.4		40.4		(101.1)		36.9
Net (loss) income from discontinued operations		(7.8)		22.4		13.6		—		28.2
Net income		51.4		60.8		54.0		(101.1)		65.1
Net income attributable to noncontrolling interests from continuing operations		—		—		(5.0)		—		(5.0)
Net income attributable to noncontrolling interests from discontinued operations		—		—		(8.6)		—		(8.6)
Net income attributable to noncontrolling interests		—		—		(13.6)		—		(13.6)
Net income attributable to AECOM from continuing operations		59.2		38.4		35.4		(101.1)		31.9
Net (loss) income attributable to AECOM from discontinued operations		(7.8)		22.4		5.0		—		19.6
Net income attributable to AECOM	$	51.4	$	60.8	$	40.4	$	(101.1)	$	51.5

Schedule of Consolidating Statements of Comprehensive Income


	For the Three Months Ended December 31, 2019
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Net income	$	40.6	$	182.7	$	73.3	$	(243.5)	$	53.1
Other comprehensive income (loss), net of tax:
Net unrealized gain on derivatives, net of tax		0.9		—		2.1		—		3.0
Foreign currency translation adjustments		—		—		48.2		—		48.2
Pension adjustments, net of tax		1.0		—		(10.6)		—		(9.6)
Other comprehensive income, net of tax		1.9		—		39.7		—		41.6
Comprehensive income, net of tax		42.5		182.7		113.0		(243.5)		94.7
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax		—		—		(12.6)		—		(12.6)
Comprehensive income attributable to AECOM, net of tax	$	42.5	$	182.7	$	100.4	$	(243.5)	$	82.1


	For the three months ended December 31, 2018
			Guarantor		Non-Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total
Net income	$	51.4	$	60.8	$	54.0	$	(101.1)	$	65.1
Other comprehensive loss, net of tax:
Net unrealized loss on derivatives, net of tax		(2.4)		—		(3.9)		—		(6.3)
Foreign currency translation adjustments		—		—		(21.8)		—		(21.8)
Pension adjustments, net of tax		0.7		—		4.6		—		5.3
Other comprehensive loss, net of tax		(1.7)		—		(21.1)		—		(22.8)
Comprehensive income, net of tax		49.7		60.8		32.9		(101.1)		42.3
Noncontrolling interests in comprehensive income of consolidated subsidiaries, net of tax		—		—		(13.6)		—		(13.6)
Comprehensive income attributable to AECOM, net of tax	$	49.7	$	60.8	$	19.3	$	(101.1)	$	28.7

Schedule on Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows

(unaudited - in millions)


	For the three months ended December 31, 2019
					Non-
			Guarantor		Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total

CASH FLOWS FROM OPERATING ACTIVITIES	$	(59.8)	$	(146.4)	$	(0.7)	$	—	$	(206.9)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures		(1.3)		(21.0)		(15.3)		—		(37.6)
Net proceeds from sale of investment securities		—		—		0.5		—		0.5
Payments for capital expenditures, net of disposals		(11.2)		(10.1)		(9.7)		—		(31.0)
Net (investment in) receipts from intercompany notes		(12.5)		(9.4)		0.8		21.1		—
Other Intercompany investing activities		(138.7)		125.5		—		13.2		—
Net cash (used in) provided by investing activities		(163.7)		85.0		(23.7)		34.3		(68.1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements		1,724.3		2.6		83.6		—		1,810.5
Repayments of borrowings under credit agreements		(1,608.2)		(3.9)		(82.6)		—		(1,694.7)
Proceeds from issuance of common stock		4.7		—		—		—		4.7
Payments to repurchase of common stock		(38.5)		—		—		—		(38.5)
Net distributions to noncontrolling interests		—		—		(34.8)		—		(34.8)
Other financing activities		11.5		(35.7)		56.3		—		32.1
Net borrowings on intercompany notes		2.5		1.2		17.4		(21.1)		—
Other intercompany financing activities		—		47.9		(34.7)		(13.2)		—
Net cash provided by financing activities		96.3		12.1		5.2		(34.3)		79.3
EFFECT OF EXCHANGE RATE CHANGES ON CASH		—		—		2.7		—		2.7
NET DECREASE IN CASH AND CASH EQUIVALENTS		(127.2)		(49.3)		(16.5)		—		(193.0)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		129.3		315.6		635.5		—		1,080.4
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	2.1	$	266.3	$	619.0	$	—	$	887.4


	For the three months ended December 31, 2018
					Non-
			Guarantor		Guarantor
	Parent		Subsidiaries		Subsidiaries		Eliminations		Total

CASH FLOWS FROM OPERATING ACTIVITIES	$	(57.3)	$	(22.2)	$	(120.9)	$	—	$	(200.4)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net investment in unconsolidated joint ventures		(0.9)		(6.8)		(30.7)		—		(38.4)
Net proceeds from sale of investments		—		—		0.6		—		0.6
Payments for capital expenditures, net of disposals		(9.8)		(5.7)		(6.4)		—		(21.9)
Net receipts from (investment in) intercompany notes		19.3		61.9		(8.4)		(72.8)		—
Other intercompany investing activities		(227.2)		(287.2)		—		514.4		—
Net cash used in investing activities		(218.6)		(237.8)		(44.9)		441.6		(59.7)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under credit agreements		2,254.8		—		35.6		—		2,290.4
Repayments of borrowings under credit agreements		(1,959.7)		(4.7)		(34.7)		—		(1,999.1)
Proceeds from issuance of common stock		5.4		—		—		—		5.4
Payments to repurchase common stock		(52.3)		—		—		—		(52.3)
Net distributions to noncontrolling interests		—		—		(28.8)		—		(28.8)
Other financing activities		1.4		(9.1)		5.3		—		(2.4)
Net borrowings (repayments) on intercompany notes		6.0		7.9		(86.7)		72.8		—
Other intercompany financing activities		—		310.0		204.4		(514.4)		—
Net cash provided by financing activities		255.6		304.1		95.1		(441.6)		213.2
EFFECT OF EXCHANGE RATE CHANGES ON CASH		—		—		(1.5)		—		(1.5)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(20.3)		44.1		(72.2)		—		(48.4)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		22.0		270.9		593.8		—		886.7
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	1.7	$	315.0	$	521.6	$	—	$	838.3

Leases - Components of lease expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Oct. 01, 2019	Sep. 30, 2019
New Accounting Pronouncements and Changes in Accounting
Retained earnings	$ 537,490		$ 599,548
Components of lease expenses
Operating lease cost	46,600
Finance lease cost
Amortization of right-of-use assets	4,700
Interest on lease liabilities	500
Variable lease cost	9,600
Short-term lease cost	3,400
Total lease cost	$ 64,800
Accounting Standards Update 2016-02
New Accounting Pronouncements and Changes in Accounting
Retained earnings		$ (87,800)

Derivative Financial Instruments and Fair Value Measurements - Cash Flow Hedges (Details) - Designated as Hedging Instrument - Cash Flow Hedging - USD ($) $ in Millions	Dec. 31, 2019	Sep. 30, 2019
Interest Rate Swap February 2021 \| AUD
Derivative financial instruments
Notional Amount	$ 200.0	$ 200.0
Fixed Rate (as a percent)	2.19%	2.19%
Interest Rate Swap September 2022 \| CAD
Derivative financial instruments
Notional Amount	$ 400.0	$ 400.0
Fixed Rate (as a percent)	2.49%	2.49%
Interest Rate Swap February 2023 \| USD
Derivative financial instruments
Notional Amount	$ 200.0	$ 200.0
Fixed Rate (as a percent)	2.60%	2.60%

Derivative Financial Instruments and Fair Value Measurements (Tables)

3 Months Ended

Dec. 31, 2019

Derivative Financial Instruments and Fair Value Measurements

Notional principle, fixed rates and related expiration dates of outstanding interest rate swap agreements


	December 31, 2019
Notional Amount	Notional Amount	Fixed	Expiration
Currency	(in millions)	Rate	Date
AUD	200.0	2.19%	February 2021
CAD	400.0	2.49%	September 2022
USD	200.0	2.60%	February 2023


	September 30, 2019
Notional Amount	Notional Amount	Fixed	Expiration
Currency	(in millions)	Rate	Date
AUD	200.0	2.19%	February 2021
CAD	400.0	2.49%	September 2022
USD	200.0	2.60%	February 2023

Joint Ventures and Variable Interest Entities

3 Months Ended

Dec. 31, 2019

Joint Ventures and Variable Interest Entities

Joint Ventures and Variable Interest Entities

5. Joint Ventures and Variable Interest Entities

The Company’s joint ventures provide architecture, engineering, program management, construction management, operations and maintenance services, and invest in real estate projects. Joint ventures, the combination of

two or more partners, are generally formed for a specific project. Management of the joint venture is typically controlled by a joint venture executive committee, comprised of representatives from the joint venture partners. The joint venture executive committee normally provides management oversight and controls decisions which could have a significant impact on the joint venture.

Some of the Company’s joint ventures have no employees and minimal operating expenses. For these joint ventures, the Company’s employees perform work for the joint venture, which is then billed to a third-party customer by the joint venture. These joint ventures function as pass through entities to bill the third-party customer. For consolidated joint ventures of this type, the Company records the entire amount of the services performed and the costs associated with these services, including the services provided by the other joint venture partners, in the Company’s result of operations. For certain of these joint ventures where a fee is added by an unconsolidated joint venture to client billings, the Company’s portion of that fee is recorded in equity in earnings of joint ventures.

The Company also has joint ventures that have their own employees and operating expenses, and to which the Company generally makes a capital contribution. The Company accounts for these joint ventures either as consolidated entities or equity method investments based on the criteria further discussed below.

The Company follows guidance on the consolidation of variable interest entities (VIEs) that requires companies to utilize a qualitative approach to determine whether it is the primary beneficiary of a VIE. The process for identifying the primary beneficiary of a VIE requires consideration of the factors that indicate a party has the power to direct the activities that most significantly impact the joint venture’s economic performance, including powers granted to the joint venture’s program manager, powers contained in the joint venture governing board and, to a certain extent, a company’s economic interest in the joint venture. The Company analyzes its joint ventures and classifies them as either:

●

a VIE that must be consolidated because the Company is the primary beneficiary or the joint venture is not a VIE and the Company holds the majority voting interest with no significant participative rights available to the other partners; or

●

a VIE that does not require consolidation and is treated as an equity method investment because the Company is not the primary beneficiary or the joint venture is not a VIE and the Company does not hold the majority voting interest.

As part of the above analysis, if it is determined that the Company has the power to direct the activities that most significantly impact the joint venture’s economic performance, the Company considers whether or not it has the obligation to absorb losses or rights to receive benefits of the VIE that could potentially be significant to the VIE.

Contractually required support provided to the Company’s joint ventures is further discussed in Note 15.

Summary of financial information of the consolidated joint ventures is as follows:


	December 31,
	2019		September 30,
	(unaudited)		2019
	(in millions)
Current assets	$	541.9	$	581.3
Non-current assets		77.2		75.4
Total assets	$	619.1	$	656.7

Current liabilities	$	412.6	$	432.8
Non-current liabilities		1.0		—
Total liabilities		413.6		432.8
Total AECOM equity		119.2		137.9
Noncontrolling interests		86.3		86.0
Total owners’ equity		205.5		223.9
Total liabilities and owners’ equity	$	619.1	$	656.7

Total revenue of the consolidated joint ventures was $220.6 million and $291.7 million for the three months ended December 31, 2019 and 2018, respectively. The assets of the Company’s consolidated joint ventures are restricted for use only by the particular joint venture and are not available for the general operations of the Company.

Summary of unaudited financial information of the unconsolidated joint ventures, as derived from their unaudited financial statements, is as follows:


	December 31,		September 30,
	2019		2019
	(in millions)
Current assets	$	1,193.0	$	1,133.5
Non-current assets		946.0		904.5
Total assets	$	2,139.0	$	2,038.0

Current liabilities	$	1,137.7	$	1,115.5
Non-current liabilities		121.8		182.3
Total liabilities		1,259.5		1,297.8
Joint ventures’ equity		879.5		740.2
Total liabilities and joint ventures’ equity	$	2,139.0	$	2,038.0

AECOM’s investment in joint ventures	$	279.3	$	256.1


	Three Months Ended
	December 31,		December 31,
	2019		2018
	(in millions)
Revenue	$	765.1	$	765.4
Cost of revenue		746.0		740.0
Gross profit	$	19.1	$	25.4
Net income	$	18.2	$	24.1

Summary of AECOM’s equity in earnings of unconsolidated joint ventures is as follows:


	Three Months Ended
	December 31,		December 31,
	2019		2018
	(in millions)
Pass through joint ventures	$	9.2	$	9.1
Other joint ventures		0.7		(2.5)
Total	$	9.9	$	6.6

Discontinued Operations, Goodwill and Intangible Assets - Carrying value of goodwill by reportable segment (Details) $ in Thousands	3 Months Ended
	Dec. 31, 2019 USD ($)
Changes in the carrying value of goodwill by reporting segment
Goodwill at the beginning of the period	$ 3,476,813
Foreign Exchange Impact	15,300
Goodwill at the end of the period	3,492,101
Americas
Changes in the carrying value of goodwill by reporting segment
Goodwill at the beginning of the period	2,623,000
Foreign Exchange Impact	2,500
Goodwill at the end of the period	2,625,500
International
Changes in the carrying value of goodwill by reporting segment
Goodwill at the beginning of the period	853,800
Foreign Exchange Impact	12,800
Goodwill at the end of the period	$ 866,600

Reclassifications out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Accumulated balances
Balance at the beginning of the period	$ (864,197)	$ (703,300)
Other comprehensive income (loss) before reclassification	37,800	(24,800)
Amounts reclassified from accumulated other comprehensive (loss) income	3,700	2,000
Balance at the end of the period	(822,666)	(726,100)
Pension Related Adjustments
Accumulated balances
Balance at the beginning of the period	(302,700)	(202,300)
Other comprehensive income (loss) before reclassification	(12,400)	3,800
Amounts reclassified from accumulated other comprehensive (loss) income	2,800	1,500
Balance at the end of the period	(312,300)	(197,000)
Foreign Currency Translation Adjustments
Accumulated balances
Balance at the beginning of the period	(548,700)	(502,200)
Other comprehensive income (loss) before reclassification	48,000	(21,800)
Balance at the end of the period	(500,700)	(524,000)
Gain(/Loss) on Derivative Instruments
Accumulated balances
Balance at the beginning of the period	(12,800)	1,200
Other comprehensive income (loss) before reclassification	2,200	(6,800)
Amounts reclassified from accumulated other comprehensive (loss) income	900	500
Balance at the end of the period	$ (9,700)	$ (5,100)

Leases - Total remaining lease payments under the Company's operating lease (Details) $ in Millions	Dec. 31, 2019 USD ($)
Leases
2020 (nine months remaining)	$ 162.2
2021	185.3
2022	155.3
2023	123.0
2024	99.8
Thereafter	359.9
Total lease payments	1,085.5
Less: Amounts representing interest	(167.3)
Total lease liabilities	$ 918.2