CMS Separation Overview
Reconciliation of GAAP to Adjusted Results
Reconciliation of Income Tax Expense from Continuing Operations to Adjusted Income Tax Expense from Continuing
Operations
33
Three Months Ended
Nine Months Ended
June 30, 2023
July 1, 2022
June 30, 2023
July 1, 2022
Income Tax Expense from Continuing
Operations
$
(54,166) $
(59,491)
(123,329) $
(121,545)
Tax Effects of Restructuring, Transaction
and Other Charges (1)
Focus 2023 Transformation, mainly real
estate rescaling efforts
(286)
(549)
(9,870)
(16,089)
Transaction costs
(173)
(1,338)
(2,910)
(4,476)
Restructuring, integration and separation
charges
(5,599)
(553)
(7,795)
(18,976)
Tax Effects of Other Adjustments (2)
Amortization of intangibles
(12,393)
(11,656)
(36,304)
(32,891)
Other income tax adjustments
6,669
1,177
(13,594)
(10,801)
Other
(761)
(1,009)
(1)
Adjusted Income Tax Expense from
Continuing Operations
$
(66,709) $
(72,410)
$
(194,811) $
(204,779)
(1) Includes estimated income tax impacts on restructuring activities around the Company's investment in PA Consulting and relating to the
separation activities around the CMS spin-off for the three- and nine-months ended June 30, 2023, along with real estate impairments
associated with the Company's Focus 2023 transformation program for the three- and nine-months ended June 30, 2023 and July 1, 2022
and related to the final pre-tax settlement of the Legacy CH2M Matter, net of previously recorded reserves for the nine months ended July 1.
2022, as well as tax impacts on charges associated with various transaction costs incurred with our acquisition and restructuring related activity
associated with Company restructuring and integration programs.
(2) Includes estimated income tax impacts on amortization of intangible assets for the three- and nine-months ended June 30, 2023 and
July 1, 2022, certain income tax adjustments for the purposes of presenting the Company's expected annual non-GAAP effective tax rate to
facilitate a more meaningful evaluation of the Company's current operating performance and comparisons to the Company's operating
performance in other periods and estimated tax impacts on certain subsidiary level contingent equity-based agreements in connection with the
transaction structure of our PA Consulting investment for the three- and nine-months ended June 30, 2023.
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