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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