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Goodwill and Intangible Assets
6 Months Ended
Jun. 30, 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
 
six months ended June 30, 2021 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
1,208
2,626
1,308
128
5,270
Currency translation and other adjustments
 
614
(2,633)
1,127
(2,141)
(3,033)
Balance as of June 30, 2021
$
215,064
$
140,155
$
160,525
$
117,705
 
$
633,449
Gross carrying amounts and accumulated amortization
 
for definite-lived intangible assets as of June 30, 2021 and December
 
31,
2020 were as follows:
Gross Carrying
Accumulated
Amount
Amortization
2021
2020
2021
2020
Customer lists and rights to sell
$
858,025
 
$
839,551
 
$
127,883
 
$
99,806
Trademarks, formulations and product
 
technology
 
168,004
 
 
166,448
 
 
34,932
 
 
30,483
Other
 
6,390
 
 
6,372
 
 
5,909
 
 
5,824
Total definite
 
-lived intangible assets
$
1,032,419
 
$
1,012,371
 
$
168,724
 
$
136,113
The Company amortizes definite-lived intangible assets on
 
a straight-line basis over their useful lives.
 
The Company recorded
$
15.0
 
million and $
29.8
 
million of amortization expense for the three and six months
 
ended June 30, 2021, respectively.
 
Comparatively,
 
the Company recorded $
13.7
 
million and $
27.7
 
million of amortization expense for the three and six months ended
June 30, 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
$
59,214
For the year ended December 31, 2022
59,564
For the year ended December 31, 2023
59,394
For the year ended December 31, 2024
58,750
For the year ended December 31, 2025
58,037
For the year ended December 31, 2026
57,740
The Company has four indefinite-lived intangible
 
assets totaling $
205.1
 
million as of both June 30, 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 June 30, 2021, the Company continued to evaluate all
 
potential triggering events, including 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 June 30, 2021.
 
While the Company concluded that the impact of COVID-19 did not
 
represent a triggering event as of June
30, 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.