Intangible Assets and Goodwill

9 Months Ended

Apr. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

The components of amortizable intangible assets are as follows:


	Weighted-Average
	Remaining	April 30, 2020						July 31, 2019
	Life in Years at			Accumulated				Accumulated
	April 30, 2020	Cost		Amortization		Cost		Amortization
Dealer networks/customer relationships	17	$	736,066	$	233,652	$	750,641	$	191,017
Trademarks	17	265,083		43,665		268,778		34,518
Design technology and other intangibles	9	197,916		33,490		196,616		19,689


Total amortizable intangible assets		$	1,199,065	$	310,807	$	1,216,035	$	245,224

Estimated future amortization expense is as follows:


For the remainder of the fiscal year ending July 31, 2020	$	24,196
For the fiscal year ending July 31, 2021	103,392
For the fiscal year ending July 31, 2022	106,597
For the fiscal year ending July 31, 2023	87,031
For the fiscal year ending July 31, 2024	78,732
For the fiscal year ending July 31, 2025 and thereafter	488,310
	$	888,258

Changes in the carrying amount of goodwill by reportable segment for the nine months ended April 30, 2020 are summarized as follows:


	North American Towables		North American Motorized		European		Other		Total
Net balance as of August 1, 2019	$	334,822	$	—	$	980,339	$	42,871	$	1,358,032
Fiscal 2020 activity:
Goodwill acquired	—		—		—		62,366		62,366
Measurement period adjustments	—		—		1,282		—		1,282
Foreign currency translation	—		—		(24,243)		—		(24,243)
Impairment charge	(1,036)		—		—		—		(1,036)
Net balance as of April 30, 2020	$	333,786	$	—	$	957,378	$	105,237	$	1,396,401

Changes in the carrying amount of goodwill by reportable segment for the nine months ended April 30, 2019 are summarized as follows:


	North American Towables		North American Motorized		European		Other		Total
Net balance as of August 1, 2018	$	334,822	$	—	$	—	$	42,871	$	377,693
Fiscal 2019 activity:
Goodwill acquired	—		—		994,427		—		994,427
Foreign currency translation	—		—		(21,933)		—		(21,933)
Net balance as of April 30, 2019	$	334,822	$	—	$	972,494	$	42,871	$	1,350,187

For goodwill impairment testing purposes, the Company’s reporting units are generally the same as its operating segments. Fair values are generally determined by a discounted cash flow model. These estimates are subject to significant management judgment, including the determination of many factors such as sales growth rates, gross margin patterns, cost growth rates, terminal value assumptions and discount rates.

The Company completed its most recent annual goodwill impairment review as of May 31, 2019, and there were no indicators of impairment due to the significant excess of reporting unit fair values in relation to their carrying values and, with respect to the European reporting unit, the then-recent acquisition date. However, because of the impact of the global coronavirus pandemic on overall macroeconomic conditions and the equity markets, and its effects on the Company’s operations during the month of April, the Company performed a quantitative assessment related to the European reporting unit as of April 30, 2020. As part of this assessment, the Company primarily considered its current projections of future cash flows, which anticipates the duration and extent of the negative impact to the business and industry being short-term in nature, and discount rates which reflect the current state of the capital markets and the commensurate level of risk associated with the Company’s cash flow projections. As a result of this assessment, the Company concluded that the fair value of the European reporting unit exceeds its carrying value and that there is no impairment of goodwill as of April 30, 2020.

The economic uncertainty and market volatility created by the global coronavirus pandemic, and its current and potential effects on the Company’s business and industry, increases the level of judgement and estimation required in determining reporting unit fair values. New information and changes in assumptions during the Company’s fiscal fourth quarter when the annual goodwill impairment review will be performed, such as forecasted consumer demand, availability of raw material supply, and valuation-related assumptions used in determining discount rates, could significantly impact reporting unit fair value and result in a material impairment.