Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Other Intangible Assets

v3.19.1
Goodwill and Other Intangible Assets
 6 Months Ended
Mar. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets

A summary of the carrying amount of goodwill attributable to each segment as well as the changes in such amounts are as follows:
 
SGK Brand
Solutions
 
Memorialization
 
Industrial Technologies
 
Consolidated
 
 
 
 
 
 
 
 
Goodwill
$
491,070

 
$
376,550

 
$
92,026

 
$
959,646

Accumulated impairment losses
(5,752
)
 
(5,000
)
 
—

 
(10,752
)
Balance at September 30, 2018
485,318

 
371,550

 
92,026

 
948,894

 
 
 
 
 
 
 
 
Additions during period
1,506

 
3,592

 
—

 
5,098

Divestiture during period
—

 
(14,970
)
 
—

 
$
(14,970
)
Translation and other adjustments
(5,759
)
 
393

 
92

 
(5,274
)
Goodwill
$
486,817

 
$
365,565

 
$
92,118

 
$
944,500

Accumulated impairment losses
(5,752
)
 
(5,000
)
 
—

 
(10,752
)
Balance at March 31, 2019
$
481,065

 
$
360,565

 
$
92,118

 
$
933,748


The Company performed its annual impairment review in the second quarter of fiscal 2019 and determined that estimated fair value for all reporting units exceeded carrying value, therefore no adjustments to the carrying value of goodwill were necessary. Recent market conditions in the United States have unfavorably impacted the operating results of one of the reporting units in the Company's SGK Brand Solutions segment. The estimated fair value of this reporting unit exceeded the carrying value (expressed as a percentage of carrying value) by approximately 10%, resulting in no goodwill impairment for the reporting unit. If the reporting unit's operating results deteriorate further, an impairment charge could be recognized in future periods.
The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of March 31, 2019 and September 30, 2018, respectively.
 
Carrying
Amount
 
Accumulated
Amortization
 
Net
March 31, 2019
 
 
 
 
 
Trade names
$
33,547

 
$
—

*
$
33,547

Trade names
145,770

 
(9,071
)
 
136,699

Customer relationships
376,843

 
(123,919
)
 
252,924

Copyrights/patents/other
20,701

 
(13,165
)
 
7,536

 
$
576,861

 
$
(146,155
)
 
$
430,706

 
 
 
 
 
 
September 30, 2018:
 

 
 

 
 

Trade names
$
126,047

 
$
—

*
$
126,047

Trade names
53,523

 
(5,444
)
 
48,079

Customer relationships
372,382

 
(110,760
)
 
261,622

Copyrights/patents/other
20,848

 
(12,686
)
 
8,162

     *Not subject to amortization
$
572,800

 
$
(128,890
)
 
$
443,910


 
The net change in intangible assets during the six months ended March 31, 2019 included the impact of foreign currency fluctuations during the period, additional amortization, additions related to the Frost acquisition, and reductions from the divestiture of a Memorialization business. During the second quarter of fiscal 2019, the Company reassessed certain of its trade names and converted them from indefinite-lived to definite-lived, and accordingly, these intangible assets are now subject to amortization.

Amortization expense on intangible assets was $9,509 and $8,249 for the three-month periods ended March 31, 2019 and 2018, respectively.  For the six-month periods ended March 31, 2019 and 2018, amortization expense was $17,622 and $14,930, respectively. Amortization expense is estimated to be $19,565 for the remainder of fiscal 2019, $37,226 in 2020, $35,753 in 2021, $34,112 in 2022 and $32,504 in 2023.