Goodwill and Identifiable Intangible Assets, Net

3 Months Ended

Mar. 31, 2021

Goodwill and Identifiable Intangible Assets, Net

Goodwill and Identifiable Intangible Assets, Net

6. Goodwill and Identifiable Intangible Assets, Net

Goodwill

The changes in the carrying amount of goodwill are as follows (in thousands):

	Mechanical Services		Electrical Services
	Segment		Segment		Total
Balance at December 31, 2019	$	234,660	$	97,787	$	332,447
Acquisitions and purchase price adjustments (See Note 5)		72,788		59,157		131,945
Balance at December 31, 2020		307,448		156,944		464,392
Acquisitions and purchase price adjustments (See Note 5)		7,726		660		8,386
Impact of segment reorganization		1,101		(1,101)		—
Balance at March 31, 2021	$	316,275	$	156,503	$	472,778

During the fourth quarter of 2020, the Company performed a qualitative assessment for all of our reporting units except one for which we performed a quantitative assessment, which considered various factors, including changes in the carrying value of the reporting unit, forecasted operating results, long-term growth rates and discount rates. Additionally, we considered qualitative key events and circumstances (i.e. macroeconomic environment, industry and market specific conditions, cost factors and events specific to the reporting unit, etc.). Based on this assessment, we concluded that it was more likely than not that the fair value of each of the reporting units was greater than its carrying value. Accordingly, no further testing was required. For our Texas electrical operation, we performed a step 1 quantitative assessment, and the calculated fair value exceeded the carrying value by 24%. As a result of uncertainty caused by COVID-19 and the reporting unit’s smaller excess of fair value percentage, this reporting unit is more susceptible to impairment risk from additional adverse changes in its operating environment, including micro- and macroeconomic environment conditions that could negatively impact them. Such adverse changes could include worsening economic conditions in the locations or markets they primarily serve, whether due to COVID-19 or other events and conditions. As of March 31, 2021, the Texas electrical operation had a goodwill balance of $96.8 million.

Identifiable Intangible Assets, Net

At March 31, 2021, future amortization expense of identifiable intangible assets is as follows (in thousands):

Year ended December 31—
2021 (remainder of the year)	$	25,738
2022		28,400
2023		24,217
2024		22,867
2025		20,680
Thereafter		108,506
Total	$	230,408