TETRA TECH INC

Previous wording

In the second quarter of fiscal 2025, we acquired Carron + Walsh ("CAW"), based in the Republic of Ireland. CAW delivers project and cost management solutions for large-scale commercial, life science, residential and infrastructure programs across Europe. CAW is a financially immaterial acquisition and is included in our CIG segment.

Current wording

In the second quarter of fiscal 2025, we acquired Carron + Walsh ("CAW"), based in the Republic of Ireland. CAW delivers project and cost management solutions for large-scale commercial, life science, residential and infrastructure programs across Europe. In the third quarter of fiscal 2025, we acquired SAGE Group Holdings ("SAGE"), an Australian consulting firm that provides innovative technology and high-quality automation services that optimize operational efficiency and drive digital transformation for commercial and government clients across the municipal water, energy, transportation, defense and manufacturing sectors. Both CAW and SAGE are included in our CIG segment.

Previous wording

Divestitures. We regularly review and evaluate our existing operations to determine whether our business model should change through the divestiture of certain businesses. Accordingly, from time to time, we may divest or wind down certain non-core businesses and reallocate our resources to businesses that better align with our long-term strategic direction. In the first quarter of fiscal 2025, we divested a financially immaterial subsidiary in South America and a line of business in Australia.

Current wording

Divestitures. We regularly review and evaluate our existing operations to determine whether our business model should change through the divestiture of certain businesses. Accordingly, from time to time, we may divest or wind down certain non-core businesses and reallocate our resources to businesses that better align with our long-term strategic direction. In the first quarter of fiscal 2025, we divested a subsidiary in South America and a line of business in Australia, both of which were immaterial.

Previous wording

General. For the first half of fiscal 2025, our 10.6% revenue growth was primarily due to increased activity in the U.S. state and local and federal government client sectors. The growth includes $39 million from our recent acquisitions, that did not have comparable revenue for the same period last year. Excluding the impact of these acquisitions, our revenue increased 9.1% compared to the first half of fiscal 2024.

Current wording

General. For the first nine months of fiscal 2025, our 7.5% revenue growth was primarily due to increased activity in the U.S. state and local and U.S. federal government client sectors. The overall growth includes $39 million from our recent acquisitions, that did not have comparable revenue for the same period last year. Excluding the impact of these acquisitions, our revenue increased 6.6% compared to the first nine months of fiscal 2024.

Previous wording

The 16.0% revenue growth in the U.S. federal government sector primarily reflects increased international development, disaster response and federal information technology system modernization activity. The growth in our international development activity primarily relates to activity in Ukraine to support energy security and other humanitarian needs. Our international development revenue increased approximately $75 million in the first half of fiscal 2025 compared to the same period last year. Additionally, our overall growth includes activities related to our disaster response programs for the Palisades and Eaton fires in Southern California, which occurred in early January 2025. The revenue growth also includes approximately $35 million of revenue from a recent acquisition that did not have comparable revenue for the prior-year period.

Current wording

The 12.0% revenue growth in the U.S. federal government sector primarily reflects increased disaster response work related to the Palisades and Eaton fires in Southern California, which occurred in early January 2025. The revenue growth also includes approximately$35 million of revenue from recent acquisitions that did not have comparable revenue for the prior-year period.

Previous wording

On the day of his inauguration, January 20, 2025, President Trump signed Executive Order 14169, titled "Reevaluating and Realigning United States Foreign Aid", which initiated a 90-day pause on all U.S. foreign development assistance programs to assess their alignment with U.S. foreign policy objectives with few exemptions. Following a six-week review, on February 27, 2025, U.S. Secretary of State Rubio announced the cancellation of 83% of United States Agency for International Development ("USAID") programs, totaling approximately 5,200 contracts. Subsequently, we were notified that virtually all of our contracts with USAID were terminated for convenience with immediate effect. Our U.S. federal government revenue included $409.3 million for USAID in the first half of fiscal 2025 compared to $334.1 million in the same period last year. Our U.S. federal government revenue for the remainder of fiscal 2025 is dependent upon the ultimate direction of the current U.S. administration; however, excluding USAID, we expect our U.S. federal revenue to grow in the second half of fiscal 2025 compared to the same period of fiscal 2024.

Current wording

On January 20, 2025, President Trump signed Executive Order 14169, titled "Reevaluating and Realigning United States Foreign Aid", which initiated a 90-day pause on all U.S. foreign development assistance programs to assess their alignment with U.S. foreign policy objectives with few exemptions. Following a six-week review, on February 27, 2025, U.S. Secretary of State Rubio announced the cancellation of 83% of United States Agency for International Development ("USAID") programs, totaling approximately 5,200 contracts. Subsequently, we were notified that virtually all of our contracts with USAID were terminated for convenience with immediate effect. For the first nine months of fiscal 2025, our U.S. federal government revenue included $499.1 million from USAID programs compared to $499.8 million for the same period last year. Although our USAID revenue was flat for the first nine months year-over-year, essentially all of our revenue in the third quarter, which totaled $89.9 million, was for wind-down activities that are nearing completion. As a result, we expect our USAID revenue to be significantly lower in the fourth quarter of fiscal 2025, both sequentially and compared to the prior-year fourth quarter. Excluding USAID, we expect our U.S. federal revenue to grow for the remainder of fiscal 2025.

Previous wording

Our U.S. state and local government revenue grew 37.5% compared to the first half of fiscal 2024 due to increased disaster response activity primarily related to Hurricanes Helene and Milton. Excluding this disaster response work, our U.S. state and local government revenue increased 15.6% in the first half of fiscal 2025 compared to fiscal 2024 first half; the growth was due to continued investment by our clients in clean drinking water. Most of our work for the U.S. state and local governments relates to critical water and environmental programs, which we expect to continue to grow for the remainder of fiscal 2025.

Current wording

Our U.S. state and local government revenue grew 34.8% compared to the first nine months of fiscal 2024 due to increased disaster response activity primarily related to Hurricanes Helene and Milton. Excluding this disaster response work, our U.S. state and local government revenue increased 15.3% in the first nine months of fiscal 2025 compared to fiscal 2024 first nine months; the growth was due to continued investment by our clients in clean drinking water. Most of our work for the U.S. state and local governments relates to critical water and environmental programs, which we expect to continue to grow for the remainder of fiscal 2025.

Previous wording

Our U.S. commercial revenue growth of 4.9% in the first half of fiscal 2025 was primarily due to increased activity for environmental services. We expect our revenue growth to continue in our U.S. commercial business for the remainder of fiscal 2025.

Current wording

Our U.S. commercial revenue growth of 0.1% in the first nine months of fiscal 2025 was primarily due to increased activity for environmental services, offset by reduced revenue related to renewable energy. We expect our U.S. commercial business revenue, excluding renewable energy, to be relatively stable for the remainder of fiscal 2025.

Previous wording

Our international revenue increased 0.4% compared to the first half of fiscal 2024. On a constant currency basis, our international revenue increased 2.1% primarily due to increased planning and design activities in the United Kingdom, partially offset by lower infrastructure work in Australia. We expect the growth in our international work to continue for the remainder of fiscal 2025, on a constant currency basis.

Current wording

For the first nine months of fiscal 2025, our international revenue decreased 0.9% primarily due to lower infrastructure work in Australia, partially offset by increased water planning and design activities in the United Kingdom. We expect the growth in our international work, excluding Australia, to continue for the remainder of fiscal 2025.

Previous wording

Our revenue growth in the second quarter and first half of fiscal 2025 reflects increases in both of our reportable segments. For the second quarter of fiscal 2025, our GSG segment's revenue and revenue, net of subcontractor costs, increased $64.3 million, or 10.8%, and $54.5 million, or 11.7%, respectively, compared to the same quarter last year. Our CIG segment's revenue increased $7.7 million, or 1.1%, and revenue, net of subcontractor costs, decreased $3.4 million, or 0.6% in the second quarter of fiscal 2025 compared to the prior-year quarter.

Current wording

Our revenue growth in the third quarter and first nine months of fiscal 2025 reflects increases primarily in our GSG reportable segment. For the third quarter of fiscal 2025, our GSG segment's revenue and revenue, net of subcontractor costs, increased $32.5 million, or 5.1%, and $32.3 million, or 6.6%, respectively, compared to the same quarter last year. Our CIG segment's revenue decreased $7.9 million, or 1.1%, and revenue, net of subcontractor costs, increased $11.2 million, or 1.8% in the third quarter of fiscal 2025 compared to the prior-year quarter.

Previous wording

For the first half of fiscal 2025, our GSG segment's revenue and revenue, net of subcontractor costs, increased $241.0 million, or 20.6%, and $212.9 million, or 23.4%, respectively, compared to the same period last year. Our CIG segment's revenue and revenue, net of subcontractor costs, increased $26.8 million, or 2.0%, and $20.3 million, or 1.8%, respectively, compared to the fiscal 2024 period. The second quarter and first half results for GSG and CIG segments are described below under "Government Services Group" and "Commercial/International Group", respectively.

Current wording

For the first nine months of fiscal 2025, our GSG segment's revenue and revenue, net of subcontractor costs, increased $273.5 million, or 15.1%, and $245.2 million, or 17.5%, respectively, compared to the same period last year. Our CIG segment's revenue and revenue, net of subcontractor costs, increased $18.9 million, or 0.9%, and $31.5 million, or 1.8%, respectively, compared to the fiscal 2024 period. The third quarter and first nine months results for GSG and CIG segments are described below under "Government Services Group" and "Commercial/International Group", respectively.

Previous wording

The following table reconciles our reported results to non-U.S. GAAP adjusted results. For the second quarter and first half of fiscal 2025, our adjusted results exclude a non-cash goodwill impairment charge of $92.4 million related to our GDS reporting unit, which resulted from the aforementioned cancellation of USAID programs in the second quarter of fiscal 2025. This charge is further described in Note 5, "Goodwill and Intangible Assets"of the “Notes to Consolidated Financial Statements”. Our adjusted results also exclude adjustments tocontingent consideration liabilities for the second quarter and first half of fiscal 2025. Additionally, for the first half of fiscal 2025, our adjusted results exclude a non-recurring charge of $115.0 million related to legal contingencies as described in Note 17, "Commitments and Contingencies" of the “Notes to Consolidated Financial Statem ents”. We determined that there is no tax benefit for $31.3 million of the legal contingency charge and $58.3 million of the goodwill impairment charge. The effective tax rate applied to the remaining adjustments to arrive at the adjusted earnings per share ("EPS") was 25.0%. We applied the relevant marginal statutory tax rate based on the nature of the adjustment and the tax jurisdiction in which it occurred. Both EPS and adjusted EPS were calculated using the diluted weighted-average common shares outstanding for the respe ctive periods as reflected in our Consolidated Statements of Income.

Current wording

The following table reconciles our reported results to non-U.S. GAAP adjusted results. For the first nine months of fiscal 2025, our adjusted results exclude a non-cash goodwill impairment charge of $92.4 million related to our GDS reporting unit, which resulted from the aforementioned cancellation of USAID programs in the second quarter of fiscal 2025. This charge is further described in Note 5, "Goodwill and Intangible Assets"of the “Notes to Consolidated Financial Statements”. Our adjusted results also exclude adjustments tocontingent consideration liabilities for the first nine months of fiscal 2025. Additionally, for the first nine months of fiscal 2025, our adjusted results exclude a non-recurring charge of $115.0 million related to legal contingencies as described in Note 17, "Commitments and Contingencies" of the “Notes to Consolidated Financial Statem ents”. We determined that there is no tax benefit for $31.3 million of the legal contingency charge and $58.3 million of the goodwill impairment charge. The effective tax rate applied to the remaining adjustments to arrive at the adjusted earnings per share ("EPS") was 25.0%. We applied the relevant marginal statutory tax rate based on the nature of the adjustment and the tax jurisdiction in which it occurred. Both EPS and adjusted EPS were calculated using the diluted weighted-average common shares outstanding for the respe ctive periods as reflected in our Consolidated Statements of Income.

Previous wording

Excluding the non-recurring charges and the earn-out gains, our adjusted operating income increased $12.4 million, or 10.5% in the second quarter of fiscal 2025 and $38.5 million, or 16.8%, in the first half of fiscal 2025 compared to the same periods last year. The increase reflects improved results in both of our reportable segments, which are described below under "Government Services Group" and "Commercial/International Group", respectively.

Current wording

Excluding the non-recurring charges and the earn-out gains, our operating income increased $35.8 million, or 27.7% in the third quarter of fiscal 2025 and $74.3 million, or 20.8%, in the first nine months of fiscal 2025 compared to the same periods last year. The increase reflects improved results in both of our reportable segments, which are described below under "Government Services Group" and "Commercial/International Group", respectively.

Previous wording

Net interest expense decreased in the second quarter and first half of fiscal 2025, due to lower average borrowings and interest rates compared to the same periods in fiscal 2024.

Current wording

Net interest expense decreased in the third quarter of fiscal 2025 due to higher interest income and lower contingent earn-out interest expense compared to the prior-year period. For the first nine months of fiscal 2025, net interest expense decreased due to lower average interest rates and borrowings compared to the fiscal 2024 period.

Previous wording

The effective tax rates for the first halves of fiscal 2025 and 2024 were 86.7% and 27.6%, respectively. Income tax expense was reduced by $1.0 million and $1.9 million of excess tax benefits on share-based payments in the first halves of fiscal 2025 and 2024, respectively. In addition, in the first half of fiscal 2025, we recognized a $92.4 million goodwill impairment as described in Note 5, “Goodwill and Intangible Assets” of the “Notes to Consolidated Financial Statements”. We determined that $58.3 million of goodwill impairment is not deductible for income tax purposes. We also recognized a $115.0 million non-recurring charge related to legal contingencies as described in Note 17, "Commitments and Contingencies" of the “Notes to Consolidated Financial Statements”. We determined that $31.3 million of this charge is not tax deductible. Furthermore, income tax expense in the first half of fiscal 2024 (all in the second quarter) included $2.8 million of expense for the settlement of various tax positions that were under audit for fiscal years 2018 through 2021. Excluding the impact of the excess tax benefits on share-based payments, the goodwill impairment and the legal contingency charge in the first half of fiscal 2025 and the settlement amounts in the first half of 2024, our effective tax rates in the first halves of fiscal 2025 and 2024 were 27.8% and 27.1%, respectively.

Current wording

The effective tax rates for the first nine months of fiscal 2025 and 2024 were 40.9% and 27.7%, respectively. Income tax expense was reduced by $1.0 million and $2.9 million of excess tax benefits on share-based payments in the first nine months of fiscal 2025 and 2024, respectively. In addition, in the first nine months of fiscal 2025, we recognized a $92.4 million goodwill impairment as described in Note 5, “Goodwill and Intangible Assets” of the “Notes to Consolidated Financial Statements”. We determined that $58.3 million of goodwill impairment is not deductible for income tax purposes. We also recognized a $115.0 million non-recurring charge related to legal contingencies as described in Note 17, "Commitments and Contingencies" of the “Notes to Consolidated Financial Statements”. We determined that $31.3 million of this charge is not tax deductible. Furthermore, income tax expense in the first nine months of fiscal 2024 (all in the second quarter) included $4.3 million of expense for the settlement of various tax positions that were under audit for fiscal years 2018 through 2021. Excluding the impact of the excess tax benefits on share-based payments, the goodwill impairment and the legal contingency charge in the first nine months of fiscal 2025 and the settlement amounts in the first nine months of 2024, our effective tax rates in the first nine months of fiscal 2025 and 2024 were 27.6% and 27.2%, respectively.

Previous wording

In December 2021, the Organisation for Economic Cooperation and Development released Pillar Two Model Rules (also referred to as the global minimum tax or Global Anti-Base Erosion "GloBE" rules), which were designed to ensure large multinational enterprises pay a minimum 15% level of tax on the income arising in each jurisdiction in which they operate. Several jurisdictions in which we operate have enacted these rules, which are effective for the first quarter of fiscal 2025. We are continually monitoring developments and evaluating the potential impacts. At this time, we do not anticipate a material tax charge as a result of implementation of these rules.

Current wording

In December 2021, the Organisation for Economic Cooperation and Development released Pillar Two Model Rules (also referred to as the global minimum tax or Global Anti-Base Erosion "GloBE" rules), which were designed to ensure large multinational enterprises pay a minimum 15% level of tax on the income arising in each jurisdiction in which they operate. Several jurisdictions in which we operate have enacted these rules, which are effective from the first quarter of fiscal 2025. We are continually monitoring developments and evaluating the potential impacts. At this time, we do not anticipate a material tax charge as a result of implementation of these rules.

Previous wording

The revenue growth in the second quarter and first half of fiscal 2025 of 10.8% and of 20.6%, respectively, compared to the same periods last year primarily reflects higher U.S. federal government activities related to international development and the previously described U.S. state and local government activities related to disaster response. The revenue growth slowed in the second quarter of fiscal 2025 compared to the first quarter of this year due to the aforementioned cancellation of contracts with USAID.

Current wording

The revenue growth in the third quarter and first nine months of fiscal 2025 of 5.1% and of 15.1%, respectively, compared to the same periods last year primarily reflects increases in the previously described U.S. government activities related to disaster response. The revenue growth for the third quarter of fiscal 2025 was partially offset by a revenue decline of $75.7 million related to the aforementioned cancellation of contracts with USAID.

Previous wording

Operating income increased primarily due to the aforementioned revenue growth. Our operating margin, based on revenue, net of subcontractor costs, for the first half of fiscal 2025 was 13.8% compared to 14.0% in the first half of fiscal 2024. The lower operating margin reflects the mix of revenue as this fiscal year's first half included a higher amount of international development activity, which operates at a lower margin compared to the other activities in the GSG segment.

Current wording

Operating income increased primarily due to the aforementioned revenue growth. Our operating margin, based on revenue, net of subcontractor costs, for the first nine months of fiscal 2025 was 15.0% compared to 14.2% in the first nine months of fiscal 2024. The improved operating margin reflects better project execution including higher labor utilization.

Previous wording

The revenue growth in the second quarter and first half of fiscal 2025 of 1.1% and 2.0%, respectively, compared to the same periods last year primarily reflects increased planning and design activities in the United Kingdom, partially offset by lower infrastructure activities in Australia and foreign currency exchange rates. On a constant currency basis, our revenue growth in the second quarter and first half of fiscal 2025 was 3.6% and 3.2%, respectively, compared to the same periods of fiscal 2024.

Current wording

For the third quarter and the first nine months of fiscal 2025, our revenue was relatively flat compared to the fiscal 2024 periods. The 1.8% growth in revenue, net of subcontractor costs, for each period compared to the third quarter and the first nine months of fiscal 2024, primarily reflects increased planning and design activities in the United Kingdom, partially offset by lower infrastructure activities in Australia.

Previous wording

Our operating income increased due to the aforementioned revenue growth. Our operating margin, based on revenue, net of subcontractor costs, for the first half of fiscal 2025 was 13.1% compared to 12.7% for the fiscal 2024 period. The improved operating margin was primarily due to our continued focus on high-end consulting services and improved project execution.

Current wording

Our operating income increased due to the aforementioned revenue growth. Our operating margin, based on revenue, net of subcontractor costs, for the first nine months of fiscal 2025 was 13.8% compared to 13.1% for the fiscal 2024 period. The improved operating margin was primarily due to our continued focus on high-end consulting services and improved project execution.

Previous wording

At March 30, 2025, our backlog decreased $1.07 billion, or 19.9%, compared to fiscal 2024 year-end primarily due tothe aforementioned cancellation of USAID contracts.

Current wording

At June 29, 2025, our backlog decreased $1.1 billion, or 20.4%, compared to fiscal 2024 year-end primarily due to the aforementioned cancellation of USAID contracts.

Previous wording

Capital Requirements. At March 30, 2025, we had $179.4 million of cash and cash equivalents and access to an additional $599.3 million of borrowings available under our credit facility. During the first half of fiscal 2025, we generated $7.2 million of cash from operations. Our primary sources of liquidity are cash flows from operations and borrowings under our credit facilities. Our primary uses of cash are to fund working capital, cash dividends, share repurchases, capital expenditures and repayment of debt, as well as to fund acquisitions and earn-out obligations from prior acquisitions. We believe that our existing cash and cash equivalents, operating cash flows and borrowing capacity under our credit agreement, as described below, will be sufficient to meet our capital requirements for at least the next 12 months.

Current wording

Capital Requirements. At June 29, 2025, we had $242.8 million of cash and cash equivalents and access to an additional $999.3 million of borro wings available under our credit facility. During the first nine months of fiscal 2025, we generated $356.8 million of cash from operations. Our primary sources of liquidity are cash flows from operations and borrowings under our credit facilities. Our primary uses of cash are to fund working capital, cash dividends, share repurchases, capital expenditures and repayment of debt, as well as to fund acquisitions and earn-out obligations from prior acquisitions. We believe that our existing cash and cash equivalents, operating cash flows and borrowing capacity under our credit agreement, as described below, will be sufficient to meet our capital requirements for at least the next 12 months.

Previous wording

Operating Activities. For the first half of fiscal 2025, our cash flows from operating activities decreased due to the timing on cash collections on USAID programs and additional working capital required to support our business growth. This decrease also reflects a $57 million payment for theaforementioned legal contingency in the second quarter of fiscal 2025.

Current wording

Operating Activities. For the first nine months of fiscal 2025, our cash flows from operating activities increased primarily due to higher operating earnings, increased cash collections on terminated USAID programs and lower income tax payments compared to the prior-year period. The overall increase was partially offset by a $57 million payment for the aforementioned legal contingency in the second quarter of fiscal 2025.

Previous wording

Investing Activities. Our cash used in investing activities for the first half of fiscal 2025 includes net payments of $6 million for the CAW acquisition, compared to $72 million for the LST acquisition completed in the second quarter of fiscal 2024.

Current wording

Investing Activities. Our cash used in investing activities for the first nine months of fiscal 2025 includes net payments of $97.7 million for the CAW and SAGE acquisitions, compared to $93.7 million for the LST and CCE acquisitions completed in the first nine months of fiscal 2024.

Previous wording

Financing Activities. In the first half of fiscal 2025, our cash used from financing activities reflects the $175 million share repurchases as our share repurchase program was reactivated this fiscal year. These share repurchases were partially funded by our net borrowings, which increased $130 million in the first half of fiscal 2025 compared to the same period in the prior year.

Current wording

Financing Activities. In the first nine months of fiscal 2025, our cash used in financing activities reflects the $200 million share repurchases as our share repurchase program was reactivated this fiscal year. These share repurchases were largely funded by our cash generated from operating activities. The overall increase in cash used in financing activities was partially offset by a $70 million increase in our net borrowings in the first nine months of fiscal 2025 compared to the fiscal 2024 period.

Previous wording

On October 26, 2022, we entered into a Third Amended and Restated Credit Agreement(“Third Amended Credit Agreement”) that provides for an additional $500 million senior secured term loan facility (the "New Term Loan Facility") increasing our total borrowing capacity to $1.55 billion. On January 23, 2023, we drew the entire amount of the New Term Loan Facility to partially finance the RPS acquisition. The New Term Loan Facility is not subject to any amortization payments of principal and matures in January 2026.

Current wording

Debt Financing. On February 18, 2022, we entered into Amendment No. 2 to the Second Amended and Restated Credit Agreement (“Second Amended Credit Agreement”) with a total borrowing capacity of $1.05 billion that was scheduled to mature in February 2027. The Second Amended Credit Agreement consisted of a $750 million senior secured, five-year facility that provided for a $250 million term loan facility ("Second Term Loan Facility") and a $500 million revolving credit facility ("Second Revolving Credit Facility"). On October 26, 2022, we entered into a Third Amended and Restated Credit Agreement (“Third Amended Credit Agreement”) that provided for an additional $500 million senior secured term loan facility ("Third Term Loan Facility") increasing our total borrowing capacity to $1.55 billion. On January 23, 2023, we drew the entire amount of the $500 million term loan facility which was scheduled to mature in January 2026. On May 5, 2025 we repaid all facilities in full as detailed below.

Previous wording

August 15, 2028. The net proceeds from the Convertible Notes were $560.5 million, $51.8 million of which were used to purchase related capped call transactions on the issue date. The remaining proceeds were used to prepay and terminate the $234.4 million outstanding under the Amended Term Loan Facility, to prepay $89.4 million outstanding under the New Term Loan Facility and to pay down borrowings of $185.0 million under the Amended Revolving Credit Facility. See Note 15, "Long-Term Debt" of the "Notes to Consolidated Financial Statements" for further discussion.

Current wording

On August 22, 2023, we issued $575.0 million in Convertible Notes that bear interest at 2.25% per annum payable semiannually in arrears on February 15 and August 15 of each year, beginning on February 15, 2024 with a maturity date of August 15, 2028. The net proceeds from the Convertible Notes were $560.5 million, $51.8 million of which were used to purchase related capped call transactions on the issue date. The remaining proceeds were used to prepay and terminate the $234.4 million outstanding under the Second Term Loan Facility, to prepay $89.4 million outstanding under the Third Term Loan Facility and to pay down borrowings of $185.0 million under the Second Revolving Credit Facility. See Note 14, "Long-Term Debt" of the "Notes to Consolidated Financial Statements" for further discussion.

Previous wording

Subsequent Event. On May 5, 2025, we entered into a Fourth Amended and Restated Credit Agreement (“Amended Credit Agreement”) with a total borrowing capacity of $1.5 billion that will mature in May 2030. The Amended Credit Agreement is a $1.1 billion senior secured, five-year facility that provides for a $250 million 3-year term loan facility (the “3Y Term Loan Facility”), a $250 million 5-year term loan facility (“the 5Y Term Loan Facility”), and a $600 million revolving credit facility (the “New Amended Revolving Credit Facility”). In addition, the Amended Credit Agreement includes a $400 million accordion feature that allows us to increase the Amended Credit Agreement to $1.5 billion subject to lender approval. The 3Y Term Loan Facility will not be subject to any scheduled amortization of principal. The 5Y Term Loan Facility will be subject to quarterly amortization of principal, based upon the annual percentages of the original stated amount thereof (Year 1: 0.0%, Year 2: 0.0%, Year 3: 5.0%, Year 4: 10.0%, Year 5: 10.0%), with the first payment being due at the end of the first full fiscal quarter following the second anniversary of the Amendment Effective Date. The Amended Credit Agreement provides for, among other things, (i) refinance indebtedness under our Third Amended Credit Agreement; (ii) finance open market repurchases of common stock, acquisitions, and cash dividends and distributions; and (iii) utilize the proceeds for working capital, capital expenditures and other general corporate purposes. The Amended Credit Agreement provides for a reduction in the pricing levels of the Consolidated Leverage Ratio and the removal of the SOFR credit spread adjustment. The New Amended Revolving Credit Facility includes a $100 million sublimit for the issuance of standby letters of credit, a $20 million sublimit for swingline loans, and a $400 million sublimit for multicurrency borrowings and letters of credit.

Current wording

On May 5, 2025, we entered into a Fourth Amended and Restated Credit Agreement (“Amended Credit Agreement”) with a total borrowing capacity of $1.5 billion that will mature in May 2030. The Amended Credit Agreement is a $1.1 billion senior secured, five-year facility that provides for a $250 million 3-year term loan facility (the “3Y Term Loan Facility”), a $250 million 5-year term loan facility (“the 5Y Term Loan Facility”), and a $600 million revolving credit facility (the “Amended Revolving Credit Facility”). In addition, the Amended Credit Agreement includes a $400 million accordion feature that allows us to increase the Amended Credit Agreement to $1.5 billion subject to lender approval. The 3Y Term Loan Facility will not be subject to any scheduled amortization of principal. The 5Y Term Loan Facility will be subject to quarterly amortization of principal, based upon the annual percentages of the original stated amount thereof (Year 1: 0.0%, Year 2: 0.0%, Year 3: 5.0%, Year 4: 10.0%, Year 5: 10.0%), with the first payment being due at the end of the first full fiscal quarter following the second anniversary of the Amendment Effective Date. The Amended Credit Agreement provides for, among other things, (i) refinance indebtedness under our Third Amended Credit Agreement; (ii) finance open market repurchases of common stock, acquisitions, and cash dividends and distributions; and (iii) utilize the proceeds for working capital, capital expenditures and other general corporate purposes. The Amended Credit Agreement provides for a reduction in the pricing levels of the Consolidated Leverage Ratio and the removal of the Secured Overnight Financing Rate ("SOFR") credit spread adjustment. The Amended Revolving Credit Facility includes a $100 million sublimit for the issuance of standby letters of credit, a $20 million sublimit for swingline loans, and a $400 million sublimit for multicurrency borrowings and letters of credit.

Previous wording

The entire 3Y Term Loan Facility and 5Y Term Loan Facility were drawn on May 5, 2025. The proceeds from these term loans were used to pay down our New Term Loan Facility and the Amended Revolving Credit Facility in full on May 5, 2025. We may borrow on the New Amended Revolving Credit Facility, at our option, at either (a) a benchmark rate plus a margin that ranges from 1.000% to 1.750% per annum, or (b) a base rate for loans in U.S. dollars (the highest of the U.S. federal funds rate plus 0.50% per annum, the bank’s prime rate or the SOFR rate plus 1.00%, plus a margin that ranges from 0% to 0.75% per annum). In each case, the applicable margin is based on our Consolidated Leverage Ratio, calculated quarterly. The 5Y Term Loan Facility is subject to the same interest rate provisions. The 3Y Term Loan Facility is subject to a benchmark rate plus a margin that ranges from 0.875% to 1.625% per annum. The Amended Credit Agreement expires on May 5, 2030, or earlier at our discretion upon payment in full of loans and other obligations.

Current wording

The entire 3Y Term Loan Facility and 5Y Term Loan Facility were drawn on May 5, 2025. The proceeds from these term loans were used to pay down our Third Term Loan Facility and the Second Revolving Credit Facility in full on May 5, 2025. We may borrow on the Amended Revolving Credit Facility, at our option, at either (a) a benchmark rate plus a margin that ranges from 1.000% to 1.750% per annum, or (b) a base rate for loans in U.S. dollars (the highest of the U.S. federal funds rate plus 0.50% per annum, the bank’s prime rate or the SOFR rate plus 1.00%, plus a margin that ranges from 0% to 0.75% per annum). In each case, the applicable margin is based on our Consolidated Leverage Ratio, calculated quarterly. The 5Y Term Loan Facility is subject to the same interest rate provisions. The 3Y Term Loan Facility is subject to a benchmark rate plus a margin that ranges from 0.875% to 1.625% per annum. The Amended Credit Agreement expires on May 5, 2030, or earlier at our discretion upon payment in full of loans and other obligations.

Previous wording

At March 30, 2025, we had $450 million in outstanding borrowings under the Third Amended Credit Agreement, which consisted of $250 million under the New Term Loan Facility and $200 million under the Amended Revolving Credit Facility. For the first half of fiscal 2025, the weighted-average interest rate of the outstanding borrowings under the Third Amended Credit Agreement was 5.78%. In addition, we had $0.7 million in standby letters of credit under the Third Amended Credit Agreement. At March 30, 2025, we had $299.3 million of available credit under the Amended Revolving Credit Facility, all of which could be borrowed without a violation of our debt covenants.

Current wording

At June 29, 2025, we had $300 million in outstanding borrowings under the Amended Credit Agreement, which consisted of $100 million under the 3Y Term Loan Facility, $200 million under the 5Y Term Loan Facility and no borrowings under the Amended Revolving Credit Facility. For the first nine months of fiscal 2025, the weighted-average interest rate of the outstanding borrowings under the credit facilities was 5.66%. In addition, we had $0.7 million in standby letters of credit under the Amended Credit Agreement. At June 29, 2025, we had $599.3 million of available credit under the Amended Revolving Credit Facility, all of which could be borrowed without a violation of our debt covenants.

Previous wording

The Third Amended Credit Agreement contains certain affirmative and restrictive covenants, and customary events of default. The financial covenants provide for a maximum Consolidated Leverage Ratio of 3.25 to 1.00 (total funded debt/EBITDA, as defined in the Third Amended Credit Agreement) and a minimum Consolidated Interest Coverage Ratio of 3.00 to 1.00 (EBITDA/Consolidated Interest Charges, as defined in the Third Amended Credit Agreement). Our obligations under the Third Amended Credit Agreement are guaranteed by certain of our domestic subsidiaries and are secured by first priority liens on (i) the equity interests of certain of our subsidiaries, including those subsidiaries that are guarantors or borrowers under the Third Amended Credit Agreement, and (ii) the accounts receivable, general intangibles and intercompany loans, and those of our subsidiaries that are guarantors or borrowers. At March 30, 2025, we were in compliance with these covenants with a consolidated leverage ratio of 1.63x and a consolidated interest coverage ratio of 15.81x.

Current wording

The Amended Credit Agreement contains certain affirmative and restrictive covenants, and customary events of default. The financial covenants provide for a maximum Consolidated Leverage Ratio of 3.50 to 1.00 (total funded debt/EBITDA, as defined in the Amended Credit Agreement) and a minimum Consolidated Interest Coverage Ratio of 3.00 to 1.00 (EBITDA/Consolidated Interest Charges, as defined in the Amended Credit Agreement). Our obligations under the Amended Credit Agreement are guaranteed by certain of our domestic subsidiaries and are secured by first priority liens on (i) the equity interests of certain of our subsidiaries, including those subsidiaries that are guarantors or borrowers under the Amended Credit Agreement, and (ii) the accounts receivable, general intangibles and intercompany loans, and those of our subsidiaries that are guarantors or borrowers. At June 29, 2025, we were in compliance with these covenants with a consolidated leverage ratio of 1.31x and a consolidated interest coverage ratio of 16.67x.

Previous wording

In addition to the Third Amended Credit Agreement, we maintain other credit facilities, which may be used for short-term cash advances and bank guarantees. At March 30, 2025, there were no borrowings under these facilities, and the aggregate amount of standby letters of credit outstanding was $39.9 million. At March 30, 2025, we had no bank overdrafts related to our disbursement bank accounts.

Current wording

In addition to the Amended Credit Agreement, we maintain other credit facilities, which may be used for short-term cash advances and bank guarantees. At June 29, 2025, there were no borrowings under these facilities, and the aggregate amount of standby letters of credit outstanding was $43.9 million. At June 29, 2025, we had no bank overdrafts related to our disbursement bank accounts.

Previous wording

Stock repurchases. On October 5, 2021, our Board of Directors authorized a stock repurchase program under which we could repurchase up to $400 million of our common stock. In the first half of fiscal 2025, we repurchased and settled 5,165,715 shares with an average price of $33.87 per share for a total cost of $175.0 million in the open market. We did not repurchase any shares of our common stock in the first half of fiscal 2024. At March 30, 2025, we had a remaining balance of $172.8 million under our stock repurchase program.

Current wording

Stock repurchases. On May 5, 2025, our Board of Directors authorized an additional $500 million stock repurchase program in addition to the previous $400 million stock repurchase program authorized on October 5, 2021. In the first nine months of fiscal 2025, we repurchased and settled 5,933,085 shares with an average price of $33.71 per share for a total cost of $200.0 million in the open market. We did not repurchase any shares of our common stock in the first nine months of fiscal 2024. At June 29, 2025, we had a remaining balance of $647.8 million under our stock repurchase programs.

Previous wording

Subsequent Events. On May 5, 2025, our Board of Directors declared a quarterly cash dividend of $0.065 per share payable on June 5, 2025 to stockholders of record as of the close of business on May 23, 2025. On May 5, 2025, our Board of Directors also authorized an additional $500 million stock repurchase program.

Current wording

Subsequent Events. On July 28, 2025, our Board of Directors declared a quarterly cash dividend of $0.065 per share payable on August 29, 2025 to stockholders of record as of the close of business on August 15, 2025.

Previous wording

At March 30, 2025 and September 29, 2024, the liability for income taxes associated with uncertain tax positions was $52.2 million and $50.1 million, respectively.

Current wording

At June 29, 2025 and September 29, 2024, the liability for income taxes associated with uncertain tax positions was $52.3 million and $50.1 million, respectively.

Previous wording

•Letters of credit and bank guarantees are used primarily to support project performance and insurance programs. We are required to reimburse the issuers of letters of credit and bank guarantees for any payments they make under the outstanding letters of credit or bank guarantees. Our Third Amended Credit Agreement and additional letter of credit facilities cover the issu ance of our standby letters of credit and bank guarantees and are critical for our normal operations. If we default on the Third Amended Credit Agreement or additional credit facilities, our inability to issue or renew standby letters of credit and bank guarantees would impair our ability to maintain normal operations. At March 30, 2025, we had $0.7 million in standby letters of credit outstanding under our Third Amended Credit Agreement and $39.9 million in standby letters of credit outstanding under our additional letter of credit facilities.

Current wording

•Letters of credit and bank guarantees are used prim arily to support project performance and insurance programs. We are required to reimburse the issuers of letters of credit and bank guarantees for any payments they make under the outstanding letters of credit or bank guarantees. Our Amended Credit Agreement and additional letter of credit facilities cover the issuance of our standby letters of credit and bank guarantees and are critical for our normal operations. If we default on the Amended Credit Agreement or additional credit facilities, our inability to issue or renew standby letters of credit and bank guarantees would impair our ability to maintain normal operations. At June 29, 2025, we had $0.7 million in standby letters of credit outstanding under our Amended Credit Agreement and $43.9 million in standby letters of credit outstanding under our additional letter of credit facilities.

Previous wording

Our critical accounting policies are disclosed in our Annual Report on Form 10-K for the fiscal year ended September 29, 2024. To date, there have been no material changes in our critical accounting policies as reported in our fiscal 2024 Annual Report on Form 10-K.

Current wording

Our critical accounting policies are disclosed in our Annual Report on Form 10-K for the fiscal year ended September 29, 2024. To date, there have been no material changes in our critical accounting policies as reported in our fiscal

Previous wording

We areexposed to interest rate risk under our Third Amended Credit Agreement. We can borrow, at our option, under both the Amended Term Loan Facility and Amended Revolving Credit Facility. We may borrow on the Amended Revolving Credit Facility, at our option, at either (a) a Eurocurrency rate plus a margin that ranges from 1.000% to 1.875% per annum, or (b) a base rate for loans in U.S. dollars (the highest of the U.S. federal funds rate plus 0.50% per annum, the bank’s prime rate or the SOFR rate plus 1.00%) plus a margin that ranges from 0% to 0.875% per annum. In each case, the applicable margin is based on our Consolidated Leverage Ratio, calculated quarterly. The Amended Term Loan Facility is subject to the same interest rate provisions. Borrowings at the base rate have no designated term and may be repaid without penalty any time prior to the Facility’s maturity date. Borrowings at a SOFR rate have a term no less than 30 days and no greater than 180 days and may be prepaid without penalty. Typically, at the end of such term, such borrowings may be rolled over at our discretion into either a borrowing at the base rate or a borrowing at a SOFR rate with similar terms, not to exceed the maturity date of the Facility. The Facility matures on February 18, 2027. At March 30, 2025, we had $450 million in outstanding borrowings under the Third Amended Credit Agreement, which consisted of $250 million under the New Term Loan Facility and $200 million under the Amended Revolving Credit Facility. For the first half of fiscal 2025, the weighted-average interest rate of the outstanding borrowings under the Third Amended Credit Agreement was 5.78%.

Current wording

We are exposed to interest rate risk under our Amended Credit Agreement. We can borrow, at our option, under the 3Y Term Loan Facility, 5Y Term Loan Facility and Amended Revolving Credit Facility. We may borrow on the Amended Revolving Credit Facility, at our option, at either (a) a benchmark rate plus a margin that ranges from 1.000% to 1.750% per annum, or (b) a base rate for loans in U.S. dollars (the highest of the U.S. federal funds rate plus 0.50% per annum, the bank’s prime rate or the SOFR rate plus 1.00%, plus a margin that ranges from 0% to 0.75% per annum). In each case, the applicable margin is based on our Consolidated Leverage Ratio, calculated quarterly. The 5Y Term Loan Facility is subject to the same interest rate provisions. The 3Y Term Loan Facility is subject to a benchmark rate plus a margin that ranges from 0.875% to 1.625% per annum. The Amended Credit Agreement expires on May 5, 2030, or earlier at our discretion upon payment in full of loans and other obligations. At June 29, 2025, we had $300 million in outstanding borrowings under the Amended Credit Agreement, which consisted of $100 million under the 3Y Term Loan Facility, $200 million under the 5Y Term Loan Facility and no borrowings under the Amended Revolving Credit Facility. For the first nine months of fiscal 2025, the weighted-average interest rate of the outstanding borrowings under the Amended Credit Agreement was 5.66%.

Previous wording

The majority of our transactions are in U.S. dollars; however, some of our subsidiaries conduct business in foreign currencies, primarily the Canadian and Australian dollars, the Euro, and British Pound. Therefore, we are subject to currency exposure and volatility because of currency fluctuations. We attempt to minimize our exposure to these fluctuations by matching revenue and expenses in the same currency for our contracts. We report our foreign currency gains and losses in “Selling, general and administrative expenses” on our consolidated statements of income. For the first half of fiscal 2025, we reported $0.7 million of foreign currency loss. The impact of the foreign currency gain and loss was immaterial for the first half of fiscal 2024.

Current wording

The majority of our transactions are in U.S. dollars; however, some of our subsidiaries conduct business in foreign currencies, primarily the Canadian and Australian dollars, the Euro, and British Pound. Therefore, we are subject to currency exposure and volatility because of currency fluctuations. We attempt to minimize our exposure to these fluctuations by matching revenue and expenses in the same currency for our contracts. We report our foreign currency gains and losses in “Selling, general and administrative expenses” on our consolidated statements of income. For the first nine months of fiscal 2025, we reported $2.3 million of foreign currency loss compared to a loss of $1.0 million in the prior year period.

Previous wording

We have foreign currency exchange rate exposure in our results of operations and equity primarily because of the currency translation related to our foreign subsidiaries where the local currency is the functional currency. To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currency denominated transactions will result in reduced revenue, operating expenses, assets and liabilities. Similarly, our revenue, operating expenses, assets and liabilities will increase if the U.S. dollar weakens against foreign currencies. For the first halves of fiscal 2025 and 2024, 35.4% and 39.1% of our consolidated revenue, respectively, was generated by our international business. For the first half of fiscal 2025, the effect of foreign exchange rate translation on our consolidated balance sheet was a decrease in equity of $74.3 million compared to an increase of $38.8 million in the prior-year period. These amounts were recognized as adjustments to equity through other comprehensive income.

Current wording

We have foreign currency exchange rate exposure in our results of operations and equity primarily because of the currency translation related to our foreign subsidiaries where the local currency is the functional currency. To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currency denominated transactions will result in reduced revenue, operating expenses, assets and liabilities. Similarly, our revenue, operating expenses, assets and liabilities will increase if the U.S. dollar weakens against foreign currencies. For the first nine months of fiscal 2025 and 2024, 36.0% and 39.0% of our consolidated revenue, respectively, was generated by our international business. For the first nine months of fiscal 2025, the effect of foreign exchange rate translation on our consolidated balance sheet was an increase in equity of $13.8 million compared to an increase of $40.6 million in the prior-year period. These amounts were recognized as adjustments to equity through other comprehensive income.