Goodwill and Other Intangibles (CenterPoint Energy and CERC) (Tables)

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

CenterPoint Energy’s goodwill by reportable segment as of December 31, 2018 and changes in the carrying amount of goodwill as of March 31, 2019 is as follows:



	December 31, 2018			Additions		March 31, 2019
	(in millions)
Indiana Electric Integrated	$	—		$	—	$	—
Natural Gas Distribution	746			—		746
Energy Services	110		(2)	—		110		(2)
Infrastructure Services	—			6		6
Corporate and Other	11			—		11
Merger (1)	—			4,256		4,256
Total	$	867		$	4,262	$	5,129


(1)	CenterPoint Energy is currently assessing its reporting units subsequent to the Merger and the allocation of goodwill from the Merger to those reporting units. See Note 3.


(2)	Amount presented is net of the accumulated goodwill impairment charge of $252 million recorded in 2012.

CERC’s goodwill by reportable segment as of both March 31, 2019 and December 31, 2018 is as follows:



	(in millions)
Natural Gas Distribution	$	746
Energy Services (1)	110
Corporate and Other	11
Total	$	867

(1) Amount presented is net of the accumulated goodwill impairment charge of $252 million recorded in 2012.

Schedule of Finite-Lived Intangible Assets [Table Text Block]

The tables below present information on CenterPoint Energy’s other intangible assets recorded in Intangible assets, net on CenterPoint Energy’s Condensed Consolidated Balance Sheets and the related amortization expense included in Depreciation and amortization on CenterPoint Energy’s Condensed Statements of Consolidated Income, unless otherwise indicated.



	March 31, 2019							December 31, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Balance		Gross Carrying Amount		Accumulated Amortization			Net Balance
	(in millions)
Customer relationships (1)	$	315	$	(31	)	$	284	$	86	$	(27	)	$	59
Covenants not to compete	4		(3		)	1		4		(3		)	1
Trade names (1)	71		(1		)	70		—		—			—
Construction backlog (1) (2)	54		(8		)	46		—		—			—
Operation and maintenance agreements (1) (2)	48		(1		)	47		—		—			—
Other	24		(12		)	12		16		(11		)	5
Total	$	516	$	(56	)	$	460	$	106	$	(41	)	$	65


(1)	The fair value of intangible assets acquired through acquisitions is preliminary and subject to change. See Note 3.


(2)	Amortization expense related to the operation and maintenance agreements and construction backlog is included in Non-utility cost of revenues, including natural gas on CenterPoint Energy’s Condensed Statements of Consolidated Income.

^[1],[2]

Finite-lived Intangible Assets Amortization Expense [Table Text Block]



		Three Months Ended March 31,
		2019		2018
	(in millions)
Amortization expense of intangible assets recorded in Depreciation and amortization		$	3	$	3

CenterPoint Energy and CERC estimate that amortization expense of intangible assets with finite lives for the next five years will be as follows:



	Amortization Expense
	CenterPoint Energy		CERC
	(in millions)
Remaining nine months of 2019	$	61	$	8
2020	39		6
2021	34		6
2022	35		6
2023	36		5
2024	29		5



		Three Months Ended March 31,
		2019		2018
	(in millions)
Amortization expense of intangible assets recorded in Depreciation and amortization (1)		$	6	$	3
Amortization expense of intangible assets recorded in Non-utility cost of revenues, including natural gas (2)		9		—


(1)	Includes $3 million of amortization expense related to intangibles acquired in the Merger. The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the three months ended March 31, 2019, is preliminary and subject to change. See Note 3.


(2)	Includes $9 million of amortization expense related to the operation and maintenance agreements and construction backlog intangibles acquired in the Merger. The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the three months ended March 31, 2019, is preliminary and subject to change. See Note 3.

The tables below present information on CERC’s other intangible assets recorded in Other non-current assets on CERC’s Condensed Consolidated Balance Sheets and the related amortization expense included in Depreciation and amortization on CERC’s Condensed Statements of Consolidated Income, unless otherwise indicated.



	March 31, 2019							December 31, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Balance		Gross Carrying Amount		Accumulated Amortization			Net Balance
	(in millions)
Customer relationships	$	86	(29		)	57		$	86	$	(27	)	$	59
Covenants not to compete	4		(3		)	1		4		(3		)	1
Other	16		(12		)	4		16		(11		)	5
Total	$	106	$	(44	)	$	62	$	106	$	(41	)	$	65

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

CenterPoint Energy and CERC estimate that amortization expense of intangible assets with finite lives for the next five years will be as follows:



	Amortization Expense
	CenterPoint Energy		CERC
	(in millions)
Remaining nine months of 2019	$	61	$	8
2020	39		6
2021	34		6
2022	35		6
2023	36		5
2024	29		5

[1]	Includes $3 million of amortization expense related to intangibles acquired in the Merger. The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the three months ended March 31, 2019, is preliminary and subject to change. See Note 3.
[2]	The fair value of intangible assets acquired through acquisitions is preliminary and subject to change. See Note 3.