GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 26, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

As required, the Company performs an annual impairment test of goodwill as of the end of the October fiscal month or more frequently if events or circumstances change that would more likely than not reduce the fair value of its reporting units below their carrying value.

In the fourth quarter 2019, in conjunction with the Company's annual goodwill impairment test, the Company concluded that the excess fair value over carrying value for the global industrial motors, commercial air moving and power switch reporting units were less than 10 percent. In the third quarter 2020, the Company performed an interim impairment analysis for the global industrial motors reporting unit triggered by events primarily driven by the economic uncertainty caused by COVID-19. The excess fair value over carrying value continues to be less than 10 percent for the global industrial motors reporting unit.

The Company developed assumptions for the potential impact of COVID-19 given the uncertainty related to supply and demand disruptions on operating results for the global industrial motors reporting unit.

While the Company is committed to the strategic actions necessary to realize the long-term forecasted revenues and EBITDA margins a worsening economic outlook could result in future impairment charges.

A lack of recovery or further deterioration in market conditions, a sustained trend of weaker than expected financial performance or a lack of recovery or further decline in the Company's market capitalization, among other factors, as a result of the COVID-19 pandemic could result in an impairment charge in future periods which could have a material adverse effect on the Company's financial statements.

The global industrial motors reporting unit had goodwill of $123.8 million as of September 26, 2020.

The following table presents changes to goodwill during the nine months ended September 26, 2020 (in millions):


	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
Balance as of December 28, 2019	$	1,501.3	$	426.6	$	170.8	$	331.2	$	572.7


Translation Adjustments	7.1		(0.6)		1.3		(1.2)		7.6




Balance as of September 26, 2020	$	1,508.4	$	426.0	$	172.1	$	330.0	$	580.3

Cumulative Goodwill Impairment Charges	$	285.2	$	183.2	$	61.6	$	17.2	$	23.2

Intangible Assets

The following table presents intangible assets (in millions):


		September 26, 2020				December 28, 2019
	Weighted Average Amortization Period (Years)	Gross Value		Accumulated Amortization		Gross Value		Accumulated Amortization
Amortizable Intangible Assets:
Customer Relationships	17	$	698.5	$	334.4	$	692.1	$	302.4
Technology	14	144.7		105.4		144.0		99.0
Trademarks	14	36.5		26.6		35.9		25.0
Patent and Engineering Drawings	5	16.6		16.6		16.6		16.6

		896.3		483.0		888.6		443.0
Non-Amortizable Trade Name		122.1		—		121.6		—
		$	1,018.4	$	483.0	$	1,010.2	$	443.0

Intangible Assets, Net of Amortization		$	535.4			$	567.2

Amortization expense recorded for the three and nine months ended September 26, 2020 was $11.9 million and $36.3 million, respectively. Amortization expense recorded for the three and nine months ended September 28, 2019 was $12.6 million and $38.0 million, respectively. Amortization expense for fiscal year 2020 is estimated to be $48.0 million. There was no impairment of intangible assets during the three and nine months ended September 26, 2020. For the nine months ended September 28, 2019, the Company recognized $4.9 million of customer relationships intangible asset impairments related to the transfer of assets to held for sale.

The following table presents future estimated annual amortization for intangible assets (in millions):


Year	Estimated Amortization
2021	$	43.0
2022	41.2
2023	41.2
2024	40.6
2025	38.5