XML 23 R12.htm IDEA: XBRL DOCUMENT v3.24.3
Goodwill and Intangible Assets
 9 Months Ended
Sep. 27, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets GOODWILL AND INTANGIBLE ASSETS
Goodwill
The Company’s methodology for allocating the purchase price relating to an acquisition is determined through established and generally accepted valuation techniques. Goodwill is measured as the excess of the consideration transferred over the sum of the amounts assigned to tangible and identifiable intangible assets acquired less liabilities assumed.
To test goodwill for impairment, the Company first performs a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If the Company concludes it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, the Company does not proceed to perform a quantitative impairment test. If the Company concludes it is more likely than not that the fair value of the reporting unit is less than its carrying value, a quantitative goodwill impairment test will be performed by comparing the fair value of each reporting unit to its carrying value. A quantitative impairment analysis, if necessary, considers the income approach, which requires estimates of the present value of expected future cash flows to determine a reporting unit’s fair value. Significant estimates include revenue growth rates and operating margins used to calculate projected future cash flows, discount rates, and future economic and market conditions. A goodwill impairment charge is recognized for the amount by which the reporting unit’s fair value is less than its carrying value. Any loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The process of evaluating the potential impairment of goodwill and intangible assets requires significant judgment. The Company regularly monitors current business conditions and other factors including, but not limited to, adverse industry or economic trends and lower projections of profitability that may impact future operating results.
During the three and nine months ended September 27, 2024, there were no changes to the Company's reporting units, and the Company did not recognize any impairment charges or additions to goodwill. Refer to Note 1, “Organization and Significant Accounting Policies” for additional information regarding impairment testing of goodwill.
Details of aggregate goodwill of the Company are as follows:
(In millions)ProductsServicesTotal
Balance at September 27, 2024$191.8 $73.5 $265.3 
Intangible Assets
Intangible assets are generally recorded in connection with a business acquisition. The Company evaluates the useful lives of its intangible assets each reporting period to determine whether events and circumstances require revising the remaining period of amortization. In addition, the Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable and evaluates indefinite-lived intangible asset for impairment annually, or more frequently if indicators of potential impairment exist. Management considers such indicators as significant differences in product demand from the estimates, changes in the competitive and economic environment, technological advances, and changes in cost structure. Refer to Note 1, “Organization and Significant Accounting Policies” for additional information regarding impairment testing of intangible assets.
Details of intangible assets were as follows:
As of September 27, 2024As of December 29, 2023
(Dollars in millions)Useful Life
(In years)		Gross
Carrying
Amount		Accumulated
Amortization 		Carrying
Value		Gross
Carrying
Amount		Accumulated
Amortization		Carrying
Value
Customer relationships
6 - 10
$207.2 $(112.4)$94.8 $207.2 $(97.5)$109.7 
Recipes2073.2 (22.4)50.8 73.2 (19.5)53.7 
Intellectual property/know-how
7 - 15
48.9 (21.7)27.2 48.9 (18.4)30.5 
Tradename
4 - 6*
32.5 (22.7)9.8 32.5 (22.1)10.4 
Standard operating procedures208.6 (2.6)6.0 8.6 (2.3)6.3 
Developed technology54.6 (0.8)3.8 4.6 (0.2)4.4 
Backlog10.6 (0.6)— 0.6 (0.3)0.3 
Total $375.6 $(183.2)$192.4 $375.6 $(160.3)$215.3 
*The Company concluded that the asset life of UCT tradename of $9.0 million is indefinite and is therefore not amortized but is reviewed for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.
The Company amortizes its intangible assets on a straight-line or accelerated basis over the estimated economic life of the assets. Amortization expense was approximately $7.6 million and $22.9 million for the three and nine months ended September 27, 2024, respectively, and $5.5 million and $16.9 million for the three and nine months ended September 29, 2023, respectively. Amortization expense related to recipes, standard operating procedures, developed technology and certain intellectual property/know-how is charged to cost of revenues and the remainder is charged to general and administrative expense. As of September 27, 2024, future estimated amortization expense is expected to be as follows:
(In millions)Amortization
Expense
2024 (remaining in year)$7.5 
202528.1 
202627.2 
202726.9 
202823.8 
Thereafter69.9 
Total$183.4