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Restructuring and Other Charges
9 Months Ended
Jun. 28, 2024
Restructuring and Related Activities [Abstract]  
Restructuring and Other Charges Restructuring and Other Charges
During fiscal 2023, the Company implemented restructuring and separation initiatives relating to the Separation Transaction which are expected to continue through fiscal 2025. Restructuring initiatives were also implemented during fiscal 2023 relating to our investment in PA Consulting, which are expected to continue through fiscal 2024, and the DVS segment reorganization, which is substantially completed. While restructuring activities for each of these programs are comprised mainly of employee termination costs, the separation activities and costs are primarily related to the engagement of outside services, dedicated internal personnel and other related costs dedicated to the Company’s Separation Transaction.
During fiscal 2022, the Company implemented certain restructuring and integration initiatives relating to the acquisitions of (i) BlackLynx, Inc. (“BlackLynx”) in November 2021, and (ii) StreetLight Data, Inc. (“StreetLight”) in February 2022. Also, during fiscal 2022 and continuing into fiscal 2023, the Company implemented further real estate rescaling efforts that were associated with its fiscal 2020 transformation program relating to real estate and other staffing initiatives. These initiatives are substantially complete.
During the fiscal year ended October 1, 2021, the Company recorded other-than-temporary impairment charges on its equity method investment in AWE Management Ltd (“AWE”) which were included in miscellaneous income (expense), net in the consolidated statement of earnings. During fiscal year 2022, the contractual operating arrangement with UK Ministry of Defence was terminated which has resulted in the wind down and full impairment of the AWE Joint Venture with immaterial activity expected going forward.
During fiscal 2021, the Company implemented certain integration initiatives associated with our PA Consulting investment. The activities are substantially completed.
During fiscal 2019 and continuing into fiscal 2020, the Company implemented certain restructuring and separation initiatives associated with the ECR sale and other related cost reduction initiatives. The restructuring activities and related costs were comprised mainly of separation and lease abandonment and sublease programs, while the separation activities and costs were mainly related to the engagement of consulting services and dedicated internal personnel and other related costs dedicated to the Company’s ECR-business separation. The activities of these initiatives have been substantially completed.
As part of the Company's acquisition of CH2M Hill Companies, Ltd. ("CH2M") during fiscal 2018, the Company implemented certain restructuring plans that were comprised mainly of severance and lease abandonment programs as well as integration activities involving the engagement of professional services and internal personnel dedicated to the Company's integration management efforts. The activities of these initiatives have been substantially completed.
Collectively, the above-mentioned restructuring activities are referred to as “Restructuring and other charges.”
The following table summarizes the impacts of the Restructuring and other charges by reportable segment in connection with the Separation Transaction, PA Consulting investment, DVS segment reorganization, StreetLight and BlackLynx acquisitions, the Company’s transformation initiatives relating to real estate and other staffing programs, the ECR sale, and CH2M acquisition for the three and nine months ended June 28, 2024 and June 30, 2023 (in thousands):
Three Months EndedNine Months Ended
June 28, 2024June 30, 2023June 28, 2024June 30, 2023
Critical Mission Solutions$5,801 $(1,128)$12,702 $2,136 
People & Places Solutions11,415 703 25,199 33,889 
Divergent Solutions2,348 100 4,075 5,312 
PA Consulting3,201 17,128 7,360 17,128 
Corporate35,323 14,109 92,049 19,731 
Total$58,088 $30,912 $141,385 $78,196 
Amounts included in:
Operating profit (mainly SG&A) (1)
$58,088 $31,184 $141,385 $79,129 
Other Income, net— (272)— (933)
$58,088 $30,912 $141,385 $78,196 

(1)The three and nine months ended June 28, 2024 included approximately $54.8 million and $133.9 million, respectively, in restructuring and other charges mainly relating to the Separation Transaction (primarily professional services and employee separation costs). Included in the three and nine months ended June 30, 2023 were $17.2 million in restructuring and other charges relating to the Company's investment in PA Consulting (primarily employee separation costs) and $13.4 million in separation activities (mainly professional services) relating to the Separation Transaction. The nine months ended June 30, 2023 included approximately $40.0 million in charges associated mainly with real estate impairments and related charges.
The activity in the Company’s accruals for Restructuring and other charges for the nine months ended June 28, 2024 is as follows (in thousands):
Balance at September 29, 2023
$37,318 
Net Charges (Credits) (1)
141,336 
Payments and other(114,859)
Balance at June 28, 2024$63,795 
(1) Excludes other net charges associated mainly with the real estate related impairments during the nine months ended June 28, 2024.
The following table summarizes the Restructuring and other charges by major type of costs for the three and nine months ended June 28, 2024 and June 30, 2023 (in thousands):
Three Months EndedNine Months Ended
June 28, 2024June 30, 2023June 28, 2024June 30, 2023
Lease Abandonments and Impairments$— $803 $49 $38,076 
Terminations25,494 17,925 49,045 26,434 
Outside Services (1)
26,793 12,168 73,859 13,646 
Other (2)
5,801 16 18,432 40 
Total$58,088 $30,912 $141,385 $78,196 
(1) Amounts in the three and nine months ended June 28, 2024 are comprised of outside services relating to the Separation Transaction.
(2) Amounts in the three and nine months ended June 28, 2024 are comprised of charges relating to the Separation Transaction.
Cumulative amounts incurred to date under our various Restructuring and other activities described above by each major type of cost as of June 28, 2024 are as follows (in thousands):
Lease Abandonments and Impairments$432,773 
Terminations217,361 
Outside Services419,549 
Other214,366 
Total$1,284,049