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Acquisitions (Notes) | 9 Months Ended
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Sep. 30, 2018
Business Combinations [Abstract] |
Acquisitions [Text Block] | 4. Acquisitions On April 2, 2018, the Company acquired all of the outstanding equity interests of ECS, headquartered in Fairfax, Virginia for $775.0 million, resulting in ECS becoming a wholly-owned subsidiary of the Company. Acquisition expenses were approximately $12.0 million and were expensed as incurred and included in SG&A expenses. ECS delivers advanced solutions in cloud, cybersecurity, artificial intelligence, machine learning, software development, IT modernization and science and engineering and is primarily focused on federal government activities. ECS was purchased to complement and elevate our offerings and strengthen the Company's position as a premier IT and professional services provider by entering the government services space. ECS is reported as a separate segment of the Company. The results of operations of ECS have been included in the consolidated results of the Company from the date of acquisition. The condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2018 included ECS revenues of $164.0 million and $319.1 million, respectively and operating income of $4.3 million and $8.0 million, respectively. Assets and liabilities of all acquired companies are recorded at their estimated fair values at the dates of acquisition. The fair value assigned to identifiable intangible assets is determined primarily by using a discounted cash flow method (a non-recurring fair value measurement based on Level 3 inputs). Goodwill represents the acquired assembled workforce, potential new customers and future cash flows after the acquisition. Goodwill related to this acquisition totaled $527.4 million, of which $507.6 million is estimated to be deductible for income tax purposes. The purchase accounting for the acquisition of ECS remains incomplete with respect to opening tangible assets, intangible assets, liabilities and taxes, as management continues to gather and evaluate information about circumstances that existed as of the acquisition date. Measurement period adjustments will be recognized prospectively within 12 months from the date of acquisition. The following table summarizes the consider ation paid and the provisional fair value of assets acquired and liabilities assumed (in thousands):
Cash |  | $ | 12,400 |
Accounts receivable |  | 97,514 |
Prepaid expenses and other current assets |  | 8,568 |
Property and equipment |  | 28,977 |
Identifiable intangible assets |  | 194,850 |
Goodwill |  | 527,388 |
Other non-current assets |  | 1,282 |
Total assets acquired |  | 870,979 |
Current liabilities |  | 93,900 |
Long-term liabilities |  | 4,425 |
Total liabilities assumed |  | 98,325 |
Total purchase price(1) |  | $ | 772,654 |
_________ (1) This amount represents the $775.0 million in purchase consideration as set forth in the purchase agreement, plus $12.4 million paid for cash acquired and $1.0 million paid for working capital delivered in excess of target working capital, less $15.7 million indebtedness assumed. The following table summarizes the acquired identifiable intangible assets of ECS (in thousands):
| Useful life |  |
Contractual customer relationships | 13 years |  | $ | 141,400 |
Backlog | 1 year |  | 26,100 |
Non-compete agreements | 4 to 7 years |  | 10,350 |
Favorable contracts | 5 years |  | 500 |
Trademarks | indefinite |  | 16,500 |
Total identifiable intangible assets acquired |  |  | $ | 194,850 |
The weighted-average amortization period for identifiable intangible assets, excluding trademarks, is 10.5 years. The summary below (in thousands, except for per share data) presents pro forma unaudited consolidated results of operations for the three and nine months ended September 30, 2018 and 2017 as if the acquisition of ECS by the Company and the acquisition of a business by ECS in April 2017, both occurred on January 1, 2017. The pro forma unaudited consolidated results give effect to, among other things: (i) amortization of intangible assets, (ii) stock-based compensation expense and the related dilution for restricted stock units granted to ECS employees, (iii) interest expense on acquisition-related debt and (iv) the exclusion of nonrecurring expenses incurred by ECS prior to its acquisition by the Company for ECS’ acquisition-related activities and costs incurred in the sale of ECS to the Company. The pro forma unaudited consolidated results are not necessarily indicative of the operating results that would have occurred if the acquisition had been consummated as of the date indicated, nor are they necessarily indicative of future operating results.
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2018 |  | 2017 |  | 2018 |  | 2017
Revenues |  | $ | 906,449 |  |  | $ | 820,185 |  |  | $ | 2,619,170 |  |  | $ | 2,381,872 |
Income from continuing operations |  | $ | 49,216 |  |  | $ | 30,246 |  |  | $ | 122,937 |  |  | $ | 66,357 |
Net income |  | $ | 49,172 |  |  | $ | 30,222 |  |  | $ | 122,704 |  |  | $ | 66,204 |
Earnings per share: |  |  |  |  |  |  |  |
Basic |  | $ | 0.94 |  |  | $ | 0.58 |  |  | $ | 2.35 |  |  | $ | 1.26 |
Diluted |  | $ | 0.93 |  |  | $ | 0.57 |  |  | $ | 2.32 |  |  | $ | 1.24 |
Number of shares and share equivalents used to calculate earnings per share: |  |  |  |  |  |  |  |
Basic |  | 52,367 |  |  | 52,500 |  |  | 52,298 |  |  | 52,660 |
Diluted |  | 53,125 |  |  | 53,223 |  |  | 53,085 |  |  | 53,350 |

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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- References No definition available. + Details
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