Sale of Energy, Chemicals and Resources ("ECR") Business

On October 21, 2018, Jacobs and WorleyParsons Limited, a company incorporated in Australia, entered into a Stock and Asset Purchase Agreement pursuant to which Buyer agreed to acquire the Company’s ECR business for a purchase price of $3.3 billion consisting of (i) $2.6 billion in cash plus (ii) 58.2 million ordinary shares of the Buyer, subject to adjustments for changes in working capital and certain other items. The Transaction, which has been approved by the boards of directors of the Company and Buyer, is expected to close in the first half of calendar2019. The completion of the Transaction is subject to certain customary closing conditions, including, but not limited to, (i) the absence of any law or order prohibiting the consummation of the Transaction, (ii) the expiration or termination of the waiting period (and any extensions thereof) applicable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), (iii) the expiration or termination of all applicable waiting periods and the receipt of all applicable approvals required pursuant to or in connection with the competition laws of certain foreign jurisdictions in which the ECR business operates, (iv) the receipt of approval from the Committee on Foreign Investment in the United States (“CFIUS”), (v) the completion of a certain number of agreed upon steps of the pre-closing restructuring activities and (vi) the transfer of certain owned real property of the ECR business. On November 2, 2018, Jacobs and the Buyer filed their Premerger Notification and Report Forms under the HSR Act with the Antitrust Division of the U.S. Department of Justice and the Federal Trade Commission. On December 3, 2018, the required 30-day waiting period under the HSR Act expired. In addition, the requisite waiting periods and approvals under the competition laws of the European Union and Canada have been satisfied. Jacobs and WorleyParsons Limited previously submitted a joint voluntary notice seeking CFIUS approval which was accepted for review beginning February 4, 2019. Additional regulatory approvals are required to be obtained as a condition to closing.

As a result of the Transaction and all relevant facts, the Company has concluded that the assets and liabilities to be sold in the Transaction (the "Disposal Group"), which includes our entire ECR business, met the criteria to be classified as held for sale beginning in the current fiscal quarter in accordance with U.S. GAAP. Furthermore, we determined that the assets held for sale should be reported as discontinued operations in accordance with ASC 210-05, Discontinued Operations because their disposal represents a strategic shift that will have a major effect on our operations and financial results. As such, the financial results of the ECR business are reflected in our unaudited Consolidated Statements of Earnings as discontinued operations for all periods presented. Furthermore, current and non-current assets and liabilities of the Disposal Group are reflected in the unaudited Consolidated Balance Sheets for both periods presented.

The Company incurred approximately $6.3 million in related transaction costs (mainly professional service fees) for the ECR sale during the three months ended December 28, 2018.

Summarized Financial Information of Discontinued Operations

The following table represents earnings from discontinued operations, net of tax (in thousands):



	For the Three Months Ended
	December 28, 2018			December 29, 2017
Revenues	$	1,164,707		$	966,312
Direct cost of contracts	(995,606		)	(826,502		)
Gross profit	169,101			139,810
Selling, general and administrative expenses	(91,010		)	(93,546		)
Operating Profit	78,091			46,264
Total other (expense) income, net	2,120			2,355
Earnings Before Taxes from Discontinued Operations	80,211			48,619
Income Tax Expense	(20,053		)	(12,155		)
Net Earnings of the Group from Discontinued Operations	$	60,158		$	36,464

The following tables represent the assets and liabilities held for sale (in thousands):



	December 28, 2018		September 28, 2018
Cash and cash equivalents	$	27,195	$	21,138
Receivables and contract assets	1,134,795		1,040,996
Prepaid expenses and other	39,280		37,200
Current assets held for sale	$	1,201,270	$	1,099,334



	December 28, 2018		September 28, 2018
Property, Equipment and Improvements, net	$	198,520	$	199,847
Goodwill	1,290,723		1,308,000
Intangibles, net	81,834		83,005
Miscellaneous	109,832		110,838
Noncurrent assets held for sale	$	1,680,909	$	1,701,690



	December 28, 2018		September 28, 2018
Notes payable	$	1,537	$	1,782
Accounts payable	247,046		351,482
Accrued liabilities	303,933		321,627
Contract liabilities	239,763		146,679
Current liabilities held for sale	$	792,279	$	821,570



	December 28, 2018		September 28, 2018
Long-term Debt	$	1,685	$	2,710
Other Deferred Liabilities	$	137,037	$	147,894
Noncurrent liabilities held for sale	$	138,722	$	150,604

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



	For the Three Months Ended
	December 28, 2018			December 29, 2017
Depreciation and amortization:
Property, equipment and improvements	$	2,109.6		$	6,355.9
Intangible assets	613.8			3,251.3
Additions to property and equipment	(1,254.1		)	(7,621.0		)
Stock based compensation	3,615.0			2,364.5