Acquisition of Citizen Engagement Centers Business (Tables)
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6 Months Ended |
Mar. 31, 2019 |
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| Business Combinations [Abstract] |
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| Schedule of Recognized Identified Assets Acquired and Liabilities Assumed |
At this time, we are in the process of finalizing our valuation of the acquired assets and assumed liabilities, including our analysis of the value of the intangible assets acquired and the tax effects of the acquisition. In addition, we continue to look for potential assets or liabilities which existed at the acquisition date. Our current estimate of the allocation of the purchase price, updated from December 31, 2018, is shown below.
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| (dollars in thousands) |
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Estimated purchase price allocation at December 31, 2018 |
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Adjustments |
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Estimated purchase price allocation at March 31, 2019 |
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| Estimated cash consideration |
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$ |
429,335 |
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$ |
1,238 |
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$ |
430,573 |
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| Billed and unbilled receivables |
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$ |
145,319 |
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$ |
(3,450) |
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$ |
141,869 |
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| Property and equipment |
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6,454 |
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— |
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6,454 |
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| Other assets |
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681 |
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3,412 |
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4,093 |
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| Intangible assets |
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122,300 |
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— |
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122,300 |
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| Total identifiable assets acquired |
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274,754 |
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(38) |
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274,716 |
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| Accounts payable and other liabilities |
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33,296 |
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(1,091) |
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32,205 |
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| Net identifiable assets acquired |
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241,458 |
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1,053 |
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242,511 |
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| Goodwill |
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187,877 |
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185 |
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188,062 |
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| Net assets acquired |
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$ |
429,335 |
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$ |
1,238 |
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$ |
430,573 |
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| Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination |
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Useful life |
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Fair value |
| Customer relationships - all contracts except U.S. Census |
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10 years |
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$ |
85,300 |
| Customer relationships - U.S. Census |
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2 years |
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37,000 |
| Total intangible assets |
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$ |
122,300 |
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| Schedule of Business Acquisition, Pro Forma Information |
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Pro forma results for the three months ended March 31, |
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Pro forma results for the six months ended March 31, |
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| (dollars in thousands, except per share amounts) |
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2019 |
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2018 |
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2019 |
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2018 |
| Revenue |
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$ |
736,520 |
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$ |
770,590 |
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$ |
1,499,568 |
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$ |
1,592,723 |
| Net income |
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61,766 |
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56,803 |
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120,962 |
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119,991 |
| Basic earnings per share attributable to MAXIMUS |
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0.96 |
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0.87 |
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1.88 |
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1.81 |
| Diluted earnings per share attributed to MAXIMUS |
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0.96 |
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0.86 |
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1.87 |
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1.80 |
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| Schedule of the contribution of acquired business |
The contribution of the acquired business for the three and six months ended March 31, 2019, is shown below.
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Acquisition Contribution for |
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| (dollars in thousands) |
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Three Months Ended
March 31, 2019 |
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Six Months Ended
March 31, 2019 |
| Revenue |
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$ |
176,003 |
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$ |
277,266 |
| Gross profit |
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32,672 |
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51,620 |
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| Schedule of Goodwill |
Changes in goodwill for the six months ended March 31, 2019, were as follows:
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| (dollars in thousands) |
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U.S. Health & Human Services |
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U.S. Federal Services |
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Outside the United States |
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Total |
| Balance as of September 30, 2018 |
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$ |
139,588 |
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$ |
228,148 |
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$ |
32,146 |
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$ |
399,882 |
| Estimated effect of the acquisition of citizen engagement centers business |
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20,071 |
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165,498 |
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2,493 |
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188,062 |
| Foreign currency translation |
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— |
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— |
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(193) |
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(193) |
| Balance as of March 31, 2019 |
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$ |
159,659 |
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$ |
393,646 |
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$ |
34,446 |
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$ |
587,751 |
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| Schedule of Finite-Lived Intangible Assets |
The following table sets forth the components of intangible assets (in thousands):
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As of March 31, 2019 |
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As of September 30, 2018 |
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| (dollars in thousands) |
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Cost |
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Accumulated
Amortization |
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Intangible
Assets, net |
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Cost |
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Accumulated
Amortization |
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Intangible
Assets, net |
| Customer contracts and relationships |
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$ |
248,770 |
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$ |
54,838 |
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$ |
193,932 |
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$ |
129,113 |
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$ |
42,683 |
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$ |
86,430 |
| Technology based intangible assets |
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5,648 |
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4,267 |
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1,381 |
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5,750 |
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4,212 |
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1,538 |
| Trademarks and trade names |
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4,480 |
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4,439 |
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41 |
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4,496 |
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4,429 |
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67 |
| Total |
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$ |
258,898 |
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$ |
63,544 |
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$ |
195,354 |
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$ |
139,359 |
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$ |
51,324 |
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$ |
88,035 |
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| Schedule of Finite-Lived Intangible Assets, Future Amortization Expense |
The estimated future amortization expense for the remainder of the current fiscal year and the next five fiscal years for the intangible assets held by the Company as of March 31, 2019, is as follows (in thousands):
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| Six months ended September 30, 2019 |
$ |
18,044 |
| 2020 |
35,307 |
| 2021 |
18,258 |
| 2022 |
15,884 |
| 2023 |
15,785 |
| 2024 |
15,662 |
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