XML 34 R15.htm IDEA: XBRL DOCUMENT
v3.21.2

GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended
--- | ---
Sep. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND INTANGIBLE ASSETS |
NOTE 6 GOODWILL AND INTANGIBLE ASSETS
Goodwill Goodwill represents the excess of the purchase price over the fair values of the assets acquired and liabilities assumed in a business combination, at the date of acquisition. Goodwill is not amortized but is tested for potential impairment at the reporting unit level, at a minimum on an annual basis, or when indications of potential impairment exist. All of our goodwill is within our North America Solutions reportable segment. The following is a summary of changes in goodwill (in thousands):
Balance at September 30, 2019 | $ | 82,786 |
Additions | 1,200 |
Impairment | (38,333) |
Balance at September 30, 2020 | 45,653 |
Additions | — |
Balance at September 30, 2021 | $ | 45,653 |
During fiscal year 2020, as a result of new information identified related to the acquisition of DrillScan®, the acquisition date fair value of the contingent consideration and goodwill increased by approximately $1.2 million. Intangible Assets Finite-lived intangible assets are amortized using the straight-line method over the period in which these assets contribute to our cash flows and are evaluated for impairment in accordance with our policies for valuation of long-lived assets. All of our intangible assets are within our North America Solutions reportable segment. Intangible assets consisted of the following:
|  |  | September 30, 2021 |  | September 30, 2020
(in thousands) | Weighted Average Estimated Useful Lives |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net
Finite-lived intangible asset: |  |  |  |  |  |  |  |  |  |  |  |  |
Developed technology | 15 years |  | $ | 89,096 |  |  | $ | 22,182 |  |  | $ | 66,914 |  |  | $ | 89,096 |  |  | $ | 16,222 |  |  | $ | 72,874 |
Intellectual property | 13 years |  | 1,500 |  |  | 216 |  |  | 1,284 |  |  | 1,500 |  |  | 103 |  |  | 1,397 |
Trade name | 20 years |  | 5,865 |  |  | 1,158 |  |  | 4,707 |  |  | 5,865 |  |  | 842 |  |  | 5,023 |
Customer relationships | 5 years |  | 4,000 |  |  | 3,067 |  |  | 933 |  |  | 4,000 |  |  | 2,267 |  |  | 1,733 |
|  |  | $ | 100,461 |  |  | $ | 26,623 |  |  | $ | 73,838 |  |  | $ | 100,461 |  |  | $ | 19,434 |  |  | $ | 81,027 |
Amortization expense in the Consolidated Statements of Operations was $7.2 million, $7.2 million and $5.8 million for fiscal years 2021, 2020 and 2019, respectively, and is estimated to be $7.2 million for fiscal year 2022, approximately $6.5 million for fiscal year 2023 and approximately $6.4 million for fiscal years 2024, 2025 and 2026. Impairment - Fiscal Year 2020 Consistent with our policy, we test goodwill annually for impairment in the fourth quarter of our fiscal year, or more frequently if there are indicators that goodwill might be impaired. Due to the market conditions described in Note 4—Property, Plant and Equipment, during the second quarter of fiscal year 2020, we concluded that goodwill and intangible assets might be impaired and tested the H&P Technologies reporting unit, where the goodwill balance is allocated and the intangible assets are recorded, for recoverability. This resulted in a goodwill only non-cash impairment charge of $38.3 million recorded in the Consolidated Statement of Operations during the fiscal year ended September 30, 2020. The recoverable amount of the H&P Technologies reporting unit was determined based on a fair value calculation which uses cash flow projections based on the Company's financial projections presented to the Board covering a five-year period, and a discount rate of 14 percent. Cash flows beyond that five-year period were extrapolated using the fifth-year data with no implied growth factor. The reporting unit level is defined as an operating segment or one level below an operating segment. The recoverable amount of the intangible assets tested for impairment within the H&P Technologies reporting unit is determined based on undiscounted cash flow projections using the Company's financial projections presented to the Board covering a five-year period and extrapolated for the remaining weighted average useful lives of the intangible assets. The most significant assumptions used in our cash flow model include timing of awarded future contracts, commercial pricing terms, utilization, discount rate, and the terminal value. These assumptions are classified as Level 3 inputs by ASC Topic 820 Fair Value Measurement and Disclosures as they are based upon unobservable inputs and primarily rely on management assumptions and forecasts. Although we believe the assumptions used in our analysis and the probability-weighted average of expected future cash flows are reasonable and appropriate, different assumptions and estimates could materially impact the analysis and our resulting conclusion.

X
- References No definition available. + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration