XML 27 R12.htm IDEA: XBRL DOCUMENT v3.23.1
Goodwill and Intangible Assets
12 Months Ended
Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets

Note 6. Goodwill and Intangible Assets

The changes in the carrying amount of goodwill by reporting unit for the fiscal years ended December 31, 2022 and 2021 were as follows:

 

 

Detergent

 

 

Shampoo

 

 

All-Purpose

 

 

Total

 

 

Balance, January 1, 2022

$

-

 

 

$

-

 

 

$

1,710

 

 

$

1,710

 

 

Additions

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

Impairment

 

-

 

 

 

-

 

 

 

(1,710

)

 

 

(1,710

)

 

Balance, December 31, 2022

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, January 1, 2021

$

593

 

 

$

760

 

 

$

1,710

 

 

$

3,063

 

 

Additions

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

Impairment

 

(593

)

 

 

(760

)

 

 

-

 

 

 

(1,353

)

 

Balance, December 31, 2021

$

-

 

 

$

-

 

 

$

1,710

 

 

$

1,710

 

 

 

Intangible assets consisted of the following:

 

 

As of December 31, 2022

 

 

As of December 31, 2021

 

 

Gross Carrying Amount

 

 

Accumulated Amortization

 

 

Net Carrying Value

 

 

Gross Carrying Amount

 

 

Accumulated Amortization

 

 

Net Carrying Value

 

Intangible assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Customer relationships

$

-

 

 

$

-

 

 

$

-

 

 

$

2,103

 

 

$

329

 

 

$

1,774

 

Trade names

 

309

 

 

 

97

 

 

 

212

 

 

 

1,680

 

 

 

151

 

 

 

1,529

 

Formulas and batching processes

 

412

 

 

 

283

 

 

 

129

 

 

 

1,036

 

 

 

299

 

 

 

737

 

Internal-use software

 

898

 

 

 

105

 

 

 

793

 

 

 

756

 

 

 

-

 

 

 

756

 

Non-compete agreement

 

33

 

 

 

30

 

 

 

3

 

 

 

48

 

 

 

35

 

 

 

13

 

 

$

1,652

 

 

$

515

 

 

$

1,137

 

 

$

5,623

 

 

$

814

 

 

$

4,809

 

 

The change in the net carrying amounts of intangible assets during 2022 was primarily due to cash paid for our internal-use software, the impact of impairment charges related to intangible assets in our reporting units more fully described below, and amortization expense. Amortization expense for the years ended December 31, 2022 and 2021 was $325 and $802, respectively.

Estimated amortization expense for 2023 and subsequent years is as follows:

 

2023

$

219

 

2024

 

219

 

2025

 

218

 

2026

 

217

 

2027

 

112

 

Thereafter

 

152

 

Total

$

1,137

 

During the second quarter of 2022, we experienced a significant decline in our stock price and market capitalization and revised internal forecasts relating to all reporting units due to inflationary related pressures at our customers which have caused sales decreases, which resulted in impairment charges to goodwill and certain intangible assets in our All-Purpose reporting unit. We made revisions to the internal forecasts relating to all reporting units during the fourth quarter of 2022 and 2021 due primarily to the sale of our Prell® and Dryel® brands as well as the impact of rising costs associated with the manufacture and distribution of our products. Through our annual assessments conducted on December 31, 2022 and 2021, respectively, we concluded that the changes in circumstances in these reporting units triggered the need for a quantitative review of the carrying values of goodwill and certain intangible assets and resulted in impairment charges to each of our Detergent, All-Purpose, and Shampoo reporting units. During the year ended December 31, 2022 and 2021, respectively, we incurred the impairment charges to the following reporting units:

 

 

2022

 

 

2021

 

 

Intangible Assets

 

 

Goodwill

 

 

Total

 

 

Intangible Assets

 

 

Goodwill

 

 

Total

 

All-Purpose

$

2,717

 

 

$

1,710

 

 

$

4,427

 

 

$

1,084

 

 

$

593

 

 

$

1,677

 

Shampoo

 

194

 

 

 

-

 

 

 

194

 

 

 

1,483

 

 

 

760

 

 

 

2,243

 

Detergent

 

551

 

 

 

-

 

 

 

551

 

 

 

130

 

 

 

-

 

 

 

130

 

 

$

3,462

 

 

$

1,710

 

 

$

5,172

 

 

$

2,697

 

 

$

1,353

 

 

$

4,050

 

The Company used the income approach and market approach to determine the fair value of the reporting units that required significant judgments and estimates by management regarding several key inputs, including future cash flows consistent with management’s strategic plans, sales growth rates and the selection of royalty rate and a discount rate, among others. Estimating sales growth rates requires significant judgment by management in areas such as future economic conditions, category and industry growth rates, product pricing, consumer tastes and preferences and future expansion expectations.