Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill And Intangible Assets Disclosure [Abstract]

9.	Goodwill and Intangible Assets

Goodwill

Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. At December 31, 2019 and 2018, we had $863.5 million and $862.1 million, respectively, of goodwill recorded in our Packaging segment and $55.2 million for both years in our Paper segment on our Consolidated Balance Sheets.

Changes in the carrying amount of our goodwill were as follows (dollars in millions):

					Total
	Packaging		Paper		Goodwill
Balance at January 1, 2018	$	828.0	$	55.2	$	883.2
Acquisitions (a)(b)		34.1		—		34.1
Balance at December 31, 2018		862.1		55.2		917.3
Acquisitions (c)		1.4		—		1.4
Balance at December 31, 2019	$	863.5	$	55.2	$	918.7

(a)	During 2018, the Company recorded a $5.5 million adjustment to increase the goodwill balance for the Company’s October 2017 acquisition of Sacramento Container.

(b)	In connection with the October 2018 acquisition of Englander, the Company recorded $28.6 million of goodwill in the Packaging segment in 2018.

(c)	During 2019, the Company recorded a $1.4 million adjustment to increase the goodwill balance for the Company’s October 2018 acquisition of Englander.

See Note 5, Acquisitions, for more information.

Intangible Assets

Intangible assets are comprised of customer relationships and trademarks and trade names.

The weighted average useful life, gross carrying amount, and accumulated amortization of our intangible assets were as follows (dollars in millions):

	As of December 31, 2019						As of December 31, 2018
	Weighted Average Remaining Useful Life (in Years)		Gross Carrying Amount		Accumulated Amortization		Weighted Average Remaining Useful Life (in Years)		Gross Carrying Amount		Accumulated Amortization
Customer relationships (d)(e)		10.0	$	503.8	$	180.2		10.9	$	504.6	$	144.5
Trademarks and trade names (e)		9.5		34.8		20.6		10.1		34.8		18.3
Other (e)		2.1		4.3		3.3		3.0		4.4		2.7
Total intangible assets (excluding goodwill)		9.9	$	542.9	$	204.1		10.8	$	543.7	$	165.5

(d)

During 2019, a corrugated products facility sold part of its operations which included existing inventory, certain production equipment, and customer relationships corresponding to the operations sold. As a result, the gross carrying amount for the customer relationships intangible asset was decreased by $0.7 million.

(e)	In connection with the October 2018 acquisition of Englander, the Company recorded intangible assets of $13.2 million for customer relationships, $0.8 million for trade names, and $0.1 million for other intangibles.

Amortization expense was $38.6 million, $40.5 million, and $35.7 million for the years ended December 31, 2019, 2018, and 2017, respectively. Estimated amortization expense of intangible assets over the next five years is expected to approximate $38.7 million (2020), $37.9 million (2021), $35.4 million (2022), $34.4 million (2023), and $33.9 million (2024).

Impairment Testing

We test goodwill for impairment annually in the fourth quarter or sooner if events or changes in circumstances indicate that the carrying value of the asset may exceed fair value. Additionally, when we experience changes to our business or operating environment, we evaluate the remaining useful lives and recoverability of our finite-lived purchased intangible assets to determine whether any adjustments to the useful lives or impairment are necessary. We completed our test in the fourth quarter and there was no indication of goodwill or intangible asset impairment.