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Goodwill and Intangible Assets
3 Months Ended
Mar. 31, 2021
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill And Intangible Assets Disclosure [Text Block]
Note 14 – Goodwill and Other Intangible Assets
 
Changes in the carrying amount of goodwill for the
 
three months ended March 31, 2020 were as follows:
Global
Specialty
Americas
EMEA
Asia/Pacific
Businesses
Total
Balance as of December 31, 2020
$
213,242
$
140,162
$
158,090
$
119,718
 
$
631,212
Goodwill additions
1,093
2,626
1,308
25
5,052
Currency translation adjustments
 
(731)
(3,925)
(956)
(3,078)
 
(8,690)
Balance as of March 31,
 
2021
$
213,604
$
138,863
$
158,442
$
116,665
 
$
627,574
Gross carrying amounts and accumulated amortization
 
for definite-lived intangible assets as of March 31, 2021 and
 
December 31,
2020 were as follows:
Gross Carrying
Accumulated
Amount
Amortization
2021
2020
2021
2020
Customer lists and rights to sell
$
846,052
 
$
839,551
 
$
110,997
 
$
99,806
Trademarks, formulations and product
 
technology
 
167,144
 
 
166,448
 
 
32,533
 
 
30,483
Other
 
6,320
 
 
6,372
 
 
5,743
 
 
5,824
Total definite
 
-lived intangible assets
$
1,019,516
 
$
1,012,371
 
$
149,273
 
$
136,113
The Company amortizes definite-lived intangible assets on
 
a straight-line basis over their useful lives.
 
The Company recorded
$
14.8
 
million and $
14.0
 
million of amortization expense for the three months ended
 
March 31, 2021 and 2020, respectively.
 
Estimated annual aggregate amortization expense for
 
the current year and subsequent five years is as follows:
For the year ended December 31, 2021
$
59,372
For the year ended December 31, 2022
59,096
For the year ended December 31, 2023
58,927
For the year ended December 31, 2024
58,427
For the year ended December 31, 2025
57,710
For the year ended December 31, 2026
57,484
The Company has four indefinite-lived intangible
 
assets totaling $
205.1
 
million as of both March 31, 2021 and December 31,
2020, including $
204.0
 
million of indefinite-lived intangible assets for trademarks and
 
tradename associated with the Combination.
Goodwill and intangible assets that have indefinite lives are
 
not amortized and are required to be assessed at least annually
 
for
impairment.
 
The Company completes its annual goodwill and indefinite-lived
 
intangible asset impairment test during the fourth
quarter of each year.
 
The Company continuously evaluates if triggering events indicate
 
a possible impairment in one or more of its
reporting units or indefinite-lived or long-lived assets.
The Company previously disclosed in its 2020 Form 10-K
 
that as of March 31, 2020, the Company concluded that the
 
impact of
COVID-19 did not represent a triggering event with
 
regards to the Company’s
 
reporting units or indefinite-lived and long-lived assets,
except for the Company’s
 
Houghton and Fluidcare trademarks and tradename indefinite
 
-lived intangible assets.
 
The determination of
estimated fair value of the Houghton and Fluidcare
 
trademarks and tradename indefinite-lived assets was based on a relief
 
from
royalty valuation method,
 
which requires management’s judgment
 
and often involves the use of significant estimates and assumptions,
including assumptions with respect to the weighted average
 
cost of capital (“WACC”)
 
and royalty rates, as well as revenue growth
rates and terminal growth rates.
 
In the first quarter of 2020, as a result of the impact of
 
COVID-19 driving a decrease in projected
legacy Houghton net sales during that year and the impact
 
of the sales decline on projected future legacy Houghton
 
net sales as well as
an increase in the WACC
 
assumption utilized in the quantitative impairment
 
assessment, the Company concluded that the estimated
fair values of the Houghton and Fluidcare trademarks
 
and tradename intangible assets were less than their carrying values.
 
As a
result, an impairment charge of $
38.0
 
million was recorded in the first quarter of 2020 to write down
 
the carrying values of these
intangible assets to their estimated fair values.
As of March 31, 2021, the Company continued to evaluate
 
the on-going impact of COVID-19 on the Company’s
 
operations, and
the volatility and uncertainty in the economic outlook as a result of
 
COVID-19, to determine if this indicated it was more likely
 
than
not that the carrying value of any of the Company’s
 
reporting units or indefinite-lived or long-lived intangible assets were
 
not
recoverable.
 
The Company concluded that the impact of COVID-19 did not represent
 
a triggering event as of March 31, 2021.
 
While
the Company concluded that the impact of COVID-19
 
did not represent a triggering event as of March 31, 2021,
 
the Company will
continue to evaluate the impact of COVID-19 on the Company’s
 
current and projected results.
 
If the current economic conditions
worsen or projections of the timeline for recovery are
 
significantly extended, then the Company may conclude in the
 
future that the
impact from COVID-19 requires the need to perform
 
further interim quantitative impairment tests, which could
 
result in additional
impairment charges in the future.