XML 26 R16.htm IDEA: XBRL DOCUMENT

Goodwill and Intangible Assets

9 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

6. Goodwill and Intangible Assets

Goodwill represents the excess of net book value over the estimated fair value of net tangible and identifiable intangible assets of a reporting unit. Goodwill is tested for impairment annually or more often if impairment indicators are present at the reporting unit level. If events occur or circumstances change that would more likely than not reduce fair values of the reporting units below their carrying values, goodwill will be evaluated for impairment between annual tests. No triggering events indicating goodwill impairment occurred during the nine months ended June 30, 2021. Please refer to Note 8, "Goodwill and Intangible Assets" to the Company's consolidated financial statements included in the 2020 Annual Report on Form 10-K for further information on the goodwill impairment testing performed during fiscal year 2020.

The Company performs its annual goodwill impairment assessment on April 1st of each year. In accordance with ASC 350, Intangibles-Goodwill and Other, the Company initially assesses qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If the Company determines, based on this assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying value, it performs a quantitative goodwill impairment test by comparing the reporting unit’s fair value with its carrying value. An impairment loss is recognized for the amount by which the reporting unit’s carrying value exceeds its fair value, up to the total amount of goodwill allocated to the reporting unit. No impairment loss is recognized if the fair value of the reporting exceeds its carrying value.

During the quarter ended June 30, 2021, the Company completed the annual goodwill impairment test for each of its reporting units, including the Automation Solutions, Contamination Control Solutions and Global Semiconductor Services reporting units within the Brooks Semiconductor Solutions Group segment, the Brooks Life Sciences Products reporting unit within the Brooks Life Sciences Products segment, and the Sample Repository Solutions and GENEWIZ reporting units within the Brooks Life Sciences Services segment. Based on the test results, the Company determined that no adjustment to goodwill was necessary. The Company conducted a qualitative assessment for the Automation Solutions, Global Semiconductor Services and Life Sciences Products reporting units. The Company determined that it was more likely than not that their fair values were greater than their carrying values. As a result of the analysis, the Company did not perform the quantitative assessment for these reporting units, and therefore, did not recognize any impairment losses. The Company performed the quantitative goodwill impairment test for the Contamination Control Solutions, the Sample Repository Solutions and GENEWIZ reporting units. The Company determined that no adjustment to goodwill was necessary since the estimated fair values exceed their book values.

As a result of a change in our management reporting structure and immediately post to the annual goodwill impairment test, the Company combined two components within the Brooks Life Sciences Services operating segment, Sample Repository Solutions and GENEWIZ components, into the Brooks Life Sciences Services reporting unit. The Company evaluated the aggregation criteria under ASC 350 for the two components and concluded that they exhibit

similar economic characteristics and meet the aggregation criteria. Post to this aggregation, the Company has five reporting units which includes the Automation Solutions, Contamination Control Solutions, Global Semiconductor Services, Brooks Life Sciences Products, and Brooks Life Sciences Services reporting units.

The changes in the Company’s goodwill by reportable segment since September 30, 2020 are as follows (in thousands):


	Brooks
	Semiconductor		Brooks		Brooks
	Solutions		Life Sciences		Life Sciences
	Group		Products		Services		Other		Total
Gross goodwill, at September 30, 2020	$	637,303	$	103,278	$	349,899	$	26,014	$	1,116,494
Accumulated goodwill impairments		(588,944)		—				(26,014)		(614,958)
Goodwill, net of accumulated impairments, at September 30, 2020		48,359		103,278		349,899		—		501,536
Acquisitions and adjustments		32,911		7,493		9,386		—		49,790
Gross goodwill, at June 30, 2021		670,214		110,771		359,285		26,014		1,166,284
Accumulated goodwill impairments		(588,944)		—				(26,014)		(614,958)
Goodwill, net of accumulated impairments, at June 30, 2021	$	81,270	$	110,771	$	359,285	$	—	$	551,326

During the nine months ended June 30, 2021, the Company recorded a goodwill increase of $49.8 million primarily related to acquisitions made during the nine months ended June 30, 2021 and the impact of foreign currency translation adjustments.

The components of the Company’s identifiable intangible assets as of June 30, 2021 and September 30, 2020 are as follows (in thousands):


	June 30, 2021						September 30, 2020
			Accumulated		Net Book				Accumulated		Net Book
	Cost		Amortization		Value		Cost		Amortization		Value
Patents	$	5,302	$	5,013	$	289	$	5,302	$	4,865	$	437
Completed technology		144,440		58,118		86,323		92,477		49,875		42,602
Trademarks and trade names		27,625		12,102		15,523		25,769		9,322		16,447
Non-competition agreements		731		129		601		—		—		—
Customer relationships		285,685		133,488		152,197		271,113		112,277		158,836
Other intangibles		251		248		3		245		242		3
	$	464,034	$	209,098	$	254,937	$	394,906	$	176,581	$	218,325

Amortization expense for intangible assets was $30.8 million and $31.3 million, respectively, during the nine months ended June 30, 2021 and 2020.

Estimated future amortization expense for the intangible assets for the remainder of fiscal year 2021, the subsequent four fiscal years and thereafter is as follows (in thousands):


Fiscal year ended September 30,
2021	$	10,853
2022		40,414
2023		37,125
2024		32,242
2025		26,937
Thereafter		107,366
	$	254,937