
In thousands	Performance Materials		Technical Nonwovens		Thermal Acoustical Solutions		Totals
Gross balance at January 1, 2019	$	143,658	$	53,254	$	12,160	$	209,072
Accumulated impairment	(63,000)		—		(12,160)		(75,160)
Net Balance at December 31, 2019	$	80,658	$	53,254	$	—	$	133,912

In thousands	Performance Materials		Technical Nonwovens		Thermal Acoustical Solutions		Totals
Gross balance at January 1, 2020	$	143,659	$	55,607	$	12,160	$	211,426
Accumulated impairment	(111,671)		—		(12,160)		(123,831)
Net Balance at December 31, 2020	$	31,988	$	55,607	$	—	$	87,595


In thousands	Performance Materials		Technical Nonwovens		Totals
Balance at January 1, 2019	$	144,626	$	52,337	$	196,963
Goodwill reduction (1)	(662)		—		(662)
Goodwill impairment	(63,000)		—		(63,000)
Currency translation adjustment	(306)		917		611
Balance at December 31, 2019	80,658		53,254		133,912

Goodwill impairment	(48,671)		—		(48,671)
Currency translation adjustment	1		2,353		2,354
Balance at December 31, 2020	$	31,988	$	55,607	$	87,595

(1)The net decrease in goodwill of $0.7 million in 2019 in the Performance Materials segment was due to a goodwill reduction of $1.3 million as a result of post-closing purchase price adjustments in the second and third quarters of 2019 related to the acquisition of Interface Performance Materials on August 31, 2018, partially offset by acquisition activity in the second quarter of 2019 resulting in an increase in goodwill of $0.6 million.

In accordance with U.S. GAAP, the Company performs an assessment of goodwill for impairment at least annually, which the Company generally performs in the fourth quarter, or whenever there is a significant change in events or circumstances that indicate that the fair value of the reporting unit is more likely than not less than the carrying amount of the reporting unit. If the estimated fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired. To the extent that the carrying value of the reporting unit exceeds its estimated fair value, a goodwill impairment charge will be recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, not to exceed the carrying amount of goodwill. The Company has the option to first assess qualitative factors such as considering capital markets environment, economic conditions, industry trends, results of operations, and other factors. If the results of the qualitative test indicate a potential for impairment, a quantitative test is performed. The quantitative test compares the estimated fair value of each reporting unit to its carrying value. To determine the fair value of the reporting unit, the Company uses a combination of two approaches: the income approach and a market approach (also known as the Guideline Public Company method), both of which are weighted equally. Under the income approach, the Company calculates fair value by taking the discounted cash flows that are based on internal projections and other assumptions deemed reasonable by management and discounting them using an estimated weighted average cost of capital. Under the market approach, fair values are estimated using published market multiples for comparable companies. Changes in these estimates or a continued decline in general economic conditions could change the Company’s conclusion regarding an impairment of goodwill and potentially result in a non-cash impairment loss in a future period.

In early 2020, the World Health Organization (“WHO”) characterized COVID-19 as a pandemic. In an effort to contain COVID-19 and slow its spread, governments throughout the world, including global and regional markets served by the Company, enacted various measures, including orders to close "non-essential" businesses, isolate residents in their places of residence and practice social distancing. These actions and the global health crisis caused by COVID-19 adversely impacted some of the Company’s businesses. Each region where the Company conducts business, including North America, Europe and Asia, was impacted by the pandemic.

During the three-month period ended March 31, 2020, the Company experienced disruptions in certain operations from lower customer demand directly attributable to the COVID-19 pandemic and the resulting impact on revenue and profitability. Many of the Company's automotive customers temporarily ceased operations during this period and it was difficult to predict the duration of the impact resulting in the following:

•The Company’s China facilities carried out a planned temporary shutdown in conjunction with the lunar New Year in late January 2020, which was extended to late February 2020 as a result of government-imposed restrictions. The facilities did not resume operations until late February 2020 and ramped back up moderately in line with customer demand. As of the date of these financial statements, all of the Company’s

The Company considered the combination of the events above to be triggering events that required an interim impairment analysis for the goodwill held at the Performance Materials and Technical Nonwovens reporting units and for a certain long-lived asset group. Therefore, during the three-month period ended March 31, 2020, in accordance with U.S. GAAP, the Company performed an interim impairment analysis of its goodwill held by the these reporting units, and of certain of its long-lived assets (principally property, plant and equipment and customer relationships).

During the three-month period ended December 31, 2020, the Company performed a qualitative assessment of macroeconomic, industry and market events and circumstances as well as the overall financial performance of the Performance Materials and Technical Nonwovens reporting units and concluded it was more likely than not that the fair values of these reporting units exceeded their carrying values. As such, the Company did not perform a quantitative impairment assessment in the three-month period ended December 31, 2020.

During the three-month period ended March 31, 2020, the Company performed an interim assessment of goodwill impairment by performing a quantitative goodwill assessment for both the Performance Materials and Technical Nonwovens reporting units. In the quantitative impairment assessment, the Company weighted equally both an income approach and a market approach to determine the fair values of the reporting units. The Company’s significant assumptions in the discounted cash flow model included, but were not limited to, future cash flow projections, the weighted average cost of capital, the terminal growth rate, and the tax rate. Under the market approach, fair values are estimated using published market multiples for comparable companies.

Lower expected demand in automotive and other end markets due to the COVID-19 pandemic resulted in a reduction in sales and cash generation projections as compared to prior projections for the reporting units. Projected future cash flows includes management estimates and assumptions that are based on the best available information as of the date of the assessment. Future cash flows can be affected by numerous factors including changes in economic, industry or market conditions, changes in the underlying business or products of the reporting unit, changes in competition, and changes in technology. The cash flows of the Company's reporting units can be significantly affected by the depth of the estimated decline in automotive and other end markets and the Company's

The weighted average cost of capital for the Performance Materials reporting unit increased from 9.2 percent in the three-month period ended December 31, 2019 to 11.5 percent in the three-month period ended March 31, 2020. The weighted average cost of capital for the Technical Nonwovens reporting unit increased from 9.2 percent in the three-month period ended December 31, 2019 to 10.8 percent in the three-month period ended March 31, 2020. There are inherent uncertainties and management judgment required in an analysis of goodwill impairment. The Company believes the income approach was appropriate because it provided a fair value estimate based upon the reporting unit's expected long-term operations and cash flow performance.

The Company also used a form of the market approach, which was derived from metrics of publicly traded companies or historically completed transactions of comparable businesses. The selection of comparable businesses was based on the markets in which the reporting unit operates giving consideration to risk profiles, size, geography, and diversity of products and services. The EBITDA multiples used in the market approach for both reporting units declined from the three-month period ended December 31, 2019 to the three-month period ended March 31, 2020 due to market-related changes in the industries in which these reporting units operate as a result of the COVID-19 pandemic.

Other assumptions included adding an implied control premium to the valuation based on estimating the fair value on a controlling basis, which was derived from research on control premiums observed in recent mergers and acquisitions in the industries in which the Company operates. The control premium for both reporting units increased by 5 percent from the three-month period ended December 31, 2019 to the three-month period ended March 31, 2020. Control premiums can be higher in periods of depressed stock prices. The Company believes the market approach was appropriate because it provided a fair value using multiples from companies with operations and economic characteristics similar to the Performance Materials reporting unit.

The Company also performed an overall reconciliation to corroborate the fair value derived from the income and market approaches to the Company's overall market capitalization. The revised projections, together with a deterioration in the inputs described above, resulted in a reduction in the fair value of both reporting units. As a result, the carrying value of the Performance Materials reporting unit exceeded its fair value by $48.7 million, resulting in an impairment charge. The fair value of the Technical Nonwovens reporting unit exceeded its carrying value. Therefore, there was no impairment charge for Technical Nonwovens.

•As a result of the COVID-19 pandemic and the Company's action plan to address the risks associated with it, the Company accelerated certain actions. One such action was a review of an underperforming European facility within the Performance Materials segment. As a result of a strategic shift regarding this facility, the Company performed an impairment assessment of the long-lived asset group of the facility. To determine the recoverability of this asset group, the Company completed an undiscounted cash flow analysis and compared it to the respective carrying value of the asset group. The impairment assessment concluded that the assets were not recoverable because the carrying value exceeded the fair value of the undiscounted cash flows, resulting in a long-lived asset impairment charge of $12.4 million.

•As a result of the temporary plant closures announced on March 20, 2020, in response to the COVID-19 pandemic's effects on the automotive sector, the Company performed an impairment assessment of the long-lived asset groups of its Thermal Acoustical Solutions segment facilities. The Company considered each respective operating facility's asset group, primarily consisting of machinery and equipment, and buildings and improvements. To determine the recoverability of each asset group, the Company completed an undiscounted cash flow analysis and compared it to each facility’s respective asset group carrying value. For two of the asset groups, the undiscounted cash flows exceeded the respective carrying value. Therefore, no further assessment of impairment was necessary. For two of the European facilities, the respective undiscounted cash flows did not exceed the respective carrying value of the facility’s asset

During the fourth quarter of 2019, in accordance with U.S. GAAP, the Company performed its annual impairment assessment of its goodwill held by the Performance Materials and Technical Nonwovens reporting units. In addition, the Company performed an impairment assessment on certain of its long-lived assets (principally machinery and equipment, and buildings and improvements) due to events and changes in circumstances during the fourth quarter of 2019 that indicated an impairment might have occurred. As a result of these impairment assessments, the Company recorded the following impairment charges during the fourth quarter of 2019 discussed below.

The Company acquired Interface Performance Materials (“IPM”) in August 2018 resulting in a significant increase in goodwill and intangible asset balances in the Performance Materials segment. Lower than expected 2019 financial results from a slowdown in demand for sealing products and revised future financial projections resulting in a reduction in long-term sales forecasts and cash generation for the Performance Materials reporting unit, caused the Company to perform a qualitative assessment of goodwill for impairment during the fourth quarter of 2019. As a result, the carrying value of the Performance Materials reporting unit exceeded the respective fair value by $63.0 million, resulting in the impairment charge.

In the quantitative impairment assessment, the Company weighted equally both an income approach and a market approach to determine the fair value of the reporting units. The Company’s significant assumptions in the discounted cash flow model included, but were not limited to, future cash flow projections, the weighted average cost of capital, the terminal growth rate, and the tax rate. Calculation of future cash flows includes management estimates and assumptions that were based on the best available information as of the date of the assessment. Future cash flows can be affected by numerous factors including changes in economic, industry or market conditions, changes in the underlying business or products of the reporting unit, changes in competition and changes in technology. There are inherent uncertainties and management judgment required in an analysis of goodwill impairment. The Company believes the income approach was appropriate because it provided a fair value estimate based upon the reporting unit's expected long-term operations and cash flow performance.

The Company also used a form of the market approach, which fair values are estimated using published market multiples for comparable companies or historically completed transactions of comparable businesses. The selection of comparable businesses is based on the markets in which the reporting unit operates giving consideration to risk profiles, size, geography, and diversity of products and services. Other assumptions included adding an implied control premium to the valuation based on estimating the fair value on a controlling basis, which was derived from research on control premiums observed in recent mergers and acquisitions in the industries in which the Company operates. The Company believes the market approach was appropriate because it provided a fair value using multiples from companies with operations and economic characteristics similar to the Performance Materials reporting unit.

The Company also performed an impairment assessment of the long-lived asset groups for its two Thermal Acoustical Solutions European facilities during the fourth quarter of 2019 due to negative 2019 financial performance compared to the respective budgets, changes in financial projections and general weakening in the European automotive sector. The Company considered each operating facility’s respective asset group, primarily

consisting of machinery and equipment, and buildings and improvements. Step one of the impairment assessment failed as the undiscounted cash flows over the useful life of each operating facility’s long-lived asset group did not exceed the respective carrying value of the facility’s asset groups. As part of step two of the impairment assessment, the Company used the market approach to determine fair value based on independent appraisals of the long-lived assets. The Company determined that impairment did not exist because the respective fair value of the long-lived asset groups for each operating facility exceeded the respective carrying values. Changes in future operating results could result in a future non-cash impairment charge.

Also during the fourth quarter of 2019, the Company performed an impairment assessment of a discrete long-lived asset group, with a carrying value of $3.0 million (primarily consisting of machinery and equipment and patents), in its Performance Materials segment as a result of negative cash flows in 2019 and an expected reduction in future demand from certain customers impacting projected net sales and cash flows. To determine the recoverability of this asset group, the Company completed an undiscounted cash flow analysis and compared it to the respective carrying value of the asset group. This analysis was primarily dependent on the expectations of the net sales over the estimated remaining useful life of the underlying asset group. The impairment assessment concluded that the asset group was not recoverable because the carrying value exceeded the fair value of the undiscounted cash flows, resulting in a long-lived asset impairment charge of $1.2 million.


	At December 31, 2020				At December 31, 2019
In thousands	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets
Customer relationships	$	143,479	$	(50,076)	$	142,400	$	(30,648)
Patents	650		(616)		759		(607)
Technology	2,500		(1,144)		2,500		(977)
Trade names	7,495		(7,167)		7,293		(5,143)
License agreements	185		(185)		610		(610)
Other	467		(467)		551		(551)
Total other intangible assets	$	154,776	$	(59,655)	$	154,113	$	(38,536)