XML 40 R24.htm IDEA: XBRL DOCUMENT v3.22.0.1
Goodwill and Intangible Assets
12 Months Ended
Dec. 31, 2021
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill And Intangible Assets Disclosure [Text Block]
Note 16 – Goodwill and Other Intangible Assets
Changes in the carrying amount of goodwill for the years ended December 31,
 
2021 and 2020 were as follows:
Global
Specialty
Americas
EMEA
Asia/Pacific
Businesses
Total
Balance as of December 31, 2019
$
216,385
$
133,018
$
141,727
$
116,075
 
$
607,205
Goodwill additions
1,485
531
-
1,329
3,345
Currency translation and other
 
adjustments
 
(4,628)
6,613
16,363
2,314
20,662
Balance as of December 31, 2020
213,242
140,162
158,090
119,718
 
631,212
Goodwill additions
1,490
3,380
1,308
2,624
8,802
Currency translation and other
 
adjustments
(709)
(8,022)
3,060
(3,149)
(8,820)
Balance as of December 31, 2021
$
214,023
$
135,520
$
162,458
$
119,193
$
631,194
Other adjustments in the table above includes updates to the Company’s
 
allocation of the Houghton purchase price and associated
goodwill to each of the Company’s
 
reportable segments during the year ended December 31, 2020, including
 
a $
2.6
 
million decrease
in the Americas, a $
1.4
 
million decrease in EMEA, a $
8.0
 
million increase in Asia/Pacific and a $
0.5
 
million increase in Global
Specialty Businesses.
 
Gross carrying amounts and accumulated amortization for definite-lived
 
intangible assets as of December 31, 2021 and 2020 were
as follows:
Gross Carrying
Accumulated
Amount
Amortization
2021
2020
2021
2020
Customer lists and rights to sell
$
853,122
$
839,551
 
$
147,858
 
$
99,806
Trademarks, formulations and product
 
technology
 
163,974
 
166,448
 
 
38,747
 
 
30,483
Other
 
6,309
 
 
6,372
 
 
5,900
 
 
5,824
Total definite-lived
 
intangible assets
$
1,023,405
 
$
1,012,371
 
$
192,505
 
$
136,113
The Company recorded $
59.9
 
million, $
55.9
 
million and $
26.7
 
million of amortization expense during the years ended December
31, 2021, 2020 and 2019, respectively.
 
Amortization is recorded within SG&A in the Company’s
 
Consolidated Statements of Income.
 
Estimated annual aggregate amortization expense for the subsequent
 
five years is as follows:
For the year ended December 31, 2022
$
59,900
For the year ended December 31, 2023
59,727
For the year ended December 31, 2024
59,138
For the year ended December 31, 2025
58,383
For the year ended December 31, 2026
58,108
The Company has four indefinite-lived intangible assets totaling $
196.9
 
million as of December 31, 2021, including $
195.8
million of indefinite-lived intangible assets for trademarks and tradename associated
 
with the Combination.
 
Comparatively, the
Company had four indefinite-lived intangible assets for trademarks and
 
tradename totaling $
205.1
 
million as of December 31, 2020.
The Company completes its annual goodwill and indefinite-lived intangible
 
asset impairment test during the fourth quarter of
each year, or more frequently if triggering
 
events indicate a possible impairment in one or more of its reporting units.
 
The Company
completed its annual impairment assessment during the fourth quarter
 
of 2021 and concluded
no
 
impairment charge was warranted.
 
The Company continually evaluates financial performance, economic
 
conditions and other relevant developments in assessing if an
interim period impairment test for one or more of its reporting units is necessary.
 
As of March 31, 2020, the Company evaluated the initial 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 they 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 assets was not recoverable.
 
The Company
concluded that the impact of COVID-19 did not represent a triggering
 
event as of March 31, 2020 with regards to the Company’s
reporting units or indefinite-lived and long-lived assets, except for the Company’s
 
Houghton and Fluidcare
TM
 
trademarks
 
and
tradename indefinite-lived intangible assets.
 
The determination of estimated fair value of the Houghton and Fluidcare
TM
 
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 in the current year
 
and the impact of the current year 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
TM
 
trademarks and tradename intangible assets were
less than their carrying values.
 
As a result, an impairment charge of $
38.0
 
million, primarily related to the Houghton trademarks and
tradename, to write down the carrying values of these intangible assets to their estimated
 
fair values was recorded in the first quarter
of 2020.