XML 36 R22.htm IDEA: XBRL DOCUMENT v3.24.0.1
Goodwill and Other Intangible Assets
 12 Months Ended
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets
15. Goodwill and Other Intangible Assets
Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. Goodwill and intangible assets with indefinite useful lives are not amortized, however, these assets are tested for impairment at least annually at the reporting unit level, using either a qualitative or quantitative approach. Impairment is the condition that exists when the carrying amount of a reporting unit, including goodwill, exceeds its fair value.
In the second quarter of 2023, management applied the qualitative assessment approach in performing its annual evaluation of goodwill for the Company's Machine Clothing reporting unit and two Engineered Composites reporting units and concluded that each reporting unit’s fair value continued to exceed its carrying value. In addition, there were no amounts at risk due to the estimated excess between the fair and carrying values. Accordingly, no impairment charges were recorded.
In the third quarter of 2023, the Company acquired all the outstanding shares of Heimbach. The preliminary fair values of the identifiable intangible assets obtained totaled $14.9 million and consisted of the Heimbach trade name and developed technology. The fair value of the trade name was $6.0 million and is considered an indefinite-lived asset because of Heimbach's rich brand heritage and customer service to the paper machine clothing industry. The fair value of the developed technology was $8.9 million and includes intellectual property-related technologies as well as know-how developed by Heimbach; and is being amortized over its economic period of benefit, which is 9 years. See Note 24, Business Combination, of the Notes to the Consolidated Financial Statements, for additional information.
We amortize certain patents, trademarks and names, customer contracts, relationships and technology assets that have finite-lives. The changes in intangible assets and goodwill from December 31, 2021 to December 31, 2023, were as follows:
(in thousands, except for years)
Amortization life in years
Balance at December 31, 2022
Acquisition
Amortization
Currency Translation
Balance at December 31, 2023
Finite-lived intangible assets:
AEC Trademarks and trade names
6-15
$34 $— $(12)$— $22 
AEC Technology
10-15
3,884 — (567)109 3,426 
AEC Intellectual property
15
994 — (83)— 911 
AEC Customer relationships
8-15
28,899 — (3,480)66 25,485 
Heimbach Developed technology
9
— 8,918 (310)124 8,732 
Total Finite-Lived intangible assets, net$33,811 $8,918 $(4,452)$299 $38,576 
Indefinite-lived intangible assets:
Heimbach Trade name
$— $5,982 $— $88 $6,070 
MC Goodwill
65,441 — — 1,432 66,873 
AEC Goodwill
112,776 — — 532 113,308 
Total Indefinite-lived intangible assets
$178,217 $5,982 $— $2,052 $186,251 

(in thousands, except for years)
Amortization life in yearsBalance at December 31,
2021		Other ChangesAmortizationCurrency
Translation		Balance at December 31,
2022
Finite-lived intangible assets:
AEC Trademarks and trade names
6-15
$45 $— $(11)$— $34 
AEC Technology
10-15
4,712 — (554)(274)3,884 
AEC Intellectual property
15
1,077 — (83)— 994 
AEC Customer contracts
6
720 — (720)— — 
AEC Customer relationships
8-15
32,527 — (3,474)(154)28,899 
Total Finite-Lived intangible assets, net$39,081 $— $(4,842)$(428)$33,811 
Indefinite-lived intangible assets:
MC Goodwill
$68,329 $— $— $(2,888)$65,441 
AEC Goodwill
113,795 — — (1,019)112,776 
Total Indefinite-lived intangible assets
$182,124 $— $— $(3,907)$178,217 
As of December 31, 2023, the gross carrying amount and accumulated amortization of Finite-lived intangible assets was $87.1 million and $48.5 million, respectively.
Amortization expense related to Finite-lived intangible assets was reported in the Consolidated Statement of Income as follows: $0.4 million in Cost of goods sold and $4.1 million in Selling, general and administrative expenses in 2023; $0.8 million in Cost of goods sold and $4.0 million in Selling, general and administrative expenses in 2022; and $3.0 million in Cost of goods sold and $4.2 million in Selling, general and administrative expenses in 2021.
Estimated amortization expense of intangibles for the years ending December 31, 2024 through 2028, is as follows:
Year
Annual amortization
(in thousands)
2024$5,200 
20255,200 
20265,200 
20275,100 
20285,100