XML 36 R17.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Goodwill and Other Intangible Assets | 12 Months Ended
--- | ---
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The Company's goodwill by segment (for the segments that had recorded goodwill) is as follows:
| December 31, 2023 |  | December 31, 2022
Executive Search |  |  |
Americas | $ | 91,740 |  |  | $ | 91,383 |
Europe | 1,494 |  |  | 1,449 |
Total Executive Search | 93,234 |  |  | 92,832 |
On-Demand Talent | 109,018 |  |  | 45,529 |
Total goodwill | $ | 202,252 |  |  | $ | 138,361 |
Changes in the carrying amount of goodwill by segment for the years ended December 31, 2023, 2022, and 2021 were as follows:
| Executive Search |  |  |  |  |  |  |  |  |  |
| Americas |  | Europe |  | Asia Pacific |  |  |  |  |  | On-Demand Talent |  | Heidrick Consulting |  | Total
Goodwill | $ | 91,643 |  |  | $ | 24,475 |  |  | $ | 8,495 |  |  |  |  |  |  | $ | — |  |  | $ | — |  |  | $ | 124,613 |
Accumulated impairment losses | — |  |  | (24,475) |  |  | (8,495) |  |  |  |  |  |  | — |  |  | — |  |  | (32,970) |
Balance at December 31, 2020 | 91,643 |  |  | — |  |  | — |  |  |  |  |  |  | — |  |  | — |  |  | 91,643 |
BTG acquisition | — |  |  | — |  |  | — |  |  |  |  |  |  | 45,529 |  |  | — |  |  | 45,529 |
Finland acquisition | — |  |  | 1,532 |  |  | — |  |  |  |  |  |  | — |  |  | — |  |  | 1,532 |
Foreign currency translation | (180) |  |  | — |  |  | — |  |  |  |  |  |  | — |  |  | — |  |  | (180) |
Balance at December 31, 2021 | 91,463 |  |  | 1,532 |  |  | — |  |  |  |  |  |  | 45,529 |  |  | — |  |  | 138,524 |
Foreign currency translation | (80) |  |  | (83) |  |  | — |  |  |  |  |  |  | — |  |  | — |  |  | (163) |
Balance at December 31, 2022 | 91,383 |  |  | 1,449 |  |  | — |  |  |  |  |  |  | 45,529 |  |  | — |  |  | 138,361 |
Atreus acquisition | — |  |  | — |  |  | — |  |  |  |  |  |  | 62,371 |  |  | — |  |  | 62,371 |
businessfourzero acquisition | — |  |  | — |  |  | — |  |  |  |  |  |  | — |  |  | 7,073 |  |  | 7,073 |
Impairment | — |  |  | — |  |  | — |  |  |  |  |  |  | — |  |  | (7,246) |  |  | (7,246) |
Foreign currency translation | 357 |  |  | 45 |  |  | — |  |  |  |  |  |  | 1,118 |  |  | 173 |  |  | 1,693 |
Goodwill | 91,740 |  |  | 25,969 |  |  | 8,495 |  |  |  |  |  |  | 109,018 |  |  | 7,246 |  |  | 242,468 |
Accumulated impairment losses | — |  |  | (24,475) |  |  | (8,495) |  |  |  |  |  |  | — |  |  | (7,246) |  |  | (40,216) |
Balance at December 31, 2023 | $ | 91,740 |  |  | $ | 1,494 |  |  | $ | — |  |  |  |  |  |  | $ | 109,018 |  |  | $ | — |  |  | $ | 202,252 |
In February 2023, the Company acquired Atreus and recorded $62.4 million of goodwill related to the acquisition in the On-Demand Talent operating segment. In April 2023, the Company acquired businessfourzero and recorded $7.1 million of goodwill related to the acquisition in the Heidrick Consulting operating segment. In April 2021, the Company acquired Business Talent Group ("BTG") and recorded $45.5 million of goodwill related to the acquisition in the On-Demand Talent operating segment. In October 2021, the Company acquired H&S Finland, and recorded $1.5 million of goodwill related to the acquisition in the Europe operating segment. During the three months ended December 31, 2023, the Company conducted its annual goodwill impairment evaluation as of October 31, 2023, in accordance with ASU No. 2017-04, Intangibles - Goodwill and Other. The goodwill impairment test is completed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value; however, the loss recognized is not to exceed the total amount of goodwill allocated to that reporting unit. The impairment test is considered for each of the Company’s reporting units that has goodwill as defined in the accounting standard for goodwill and intangible assets. The Company operates five reporting units: Americas, Europe (which includes Africa), Asia Pacific (which includes the Middle East), On-Demand Talent, and Heidrick Consulting. As of October 31, 2023, only the Americas, Europe, and On-Demand Talent reporting units had recorded goodwill. During the impairment evaluation process, the Company used a discounted cash flow methodology to estimate the fair value of each of its reporting units with goodwill. The discounted cash flow approach is dependent on a number of factors, including estimates of future market growth and trends, forecasted revenue and costs, capital investments, appropriate discount rates, certain assumptions to allocate shared costs, assets and liabilities, historical and projected performance of the reporting unit and the macroeconomic conditions affecting each of the Company’s reporting units. The assumptions used in the determination of fair value were (1) a forecast of growth in the near and long term; (2) the discount rate; (3) working capital investments; and (4) other factors. Based on the results of the impairment analysis, the fair values of the Americas, Europe, and On-Demand Talent reporting units exceeded their carrying values by 258%, 3% and 6%, respectively. The results of the impairment test are sensitive to the assumptions used in the determination of fair value of the reporting units and the fair value of a reporting unit may deteriorate and could result in the need to record an impairment charge in future periods. The Company continually monitors for potential triggering events including changes in the business climate in which it operates, the Company's market capitalization compared to is book value, and the Company's recent operating performance. Any changes in these factors could result in an impairment charge. During the three months ended June 30, 2023, the Company acquired businessfourzero and recorded approximately $7.1 million of goodwill in the Heidrick Consulting reporting unit. Due to the inclusion of goodwill in a reporting unit with a pre-existing fair value shortfall, the Company evaluated the recent and anticipated future financial performance of the Heidrick Consulting reporting unit and determined that it was more likely than not that the fair value of the reporting unit was less than its carrying value. As a result, the Company identified a triggering event and performed an interim goodwill impairment evaluation during the three months ended June 30, 2023. Based on the results of the impairment evaluation, the Company determined that the goodwill within the Heidrick Consulting reporting unit was impaired, which resulted in an impairment charge of $7.2 million to write off all of the associated goodwill. The impairment charge is recorded within Impairment charges in the Consolidated Statements of Comprehensive Income for the year ended December 31, 2023, and the Consolidated Statements of Cash Flows for the year ended December 31, 2023. The impairment was non-cash in nature and did not affect the Company's current liquidity, cash flows, borrowing capability or operations, nor did it impact the debt covenants under the Company's credit agreement. Other Intangible Assets, net The Company’s other intangible assets, net by segment, are as follows:
|  | December 31, 2023 |  | December 31, 2022
Executive Search |  |  |  |
Americas |  | $ | 22 |  |  | $ | 51 |
Europe |  | 95 |  |  | 216 |
Asia Pacific |  | — |  |  | 15 |
Total Executive Search |  | 117 |  |  | 282 |
On-Demand Talent |  | 17,689 |  |  | 6,051 |
Heidrick Consulting |  | 3,036 |  |  | — |
Total other intangible assets, net |  | $ | 20,842 |  |  | $ | 6,333 |
In February 2023, the Company acquired Atreus and recorded customer relationships short-term, customer relationships long-term, software and trade name intangible assets in the On-Demand Talent operating segment of $6.0 million, $5.3 million, $5.4 million, and $2.5 million, respectively. The combined estimated weighted-average amortization period for the acquired intangible assets is 6.7 years with estimated amortization periods of 5.0, 14.0, 3.0 and 3.0 years for the customer relationships short-term, customer relationships long-term, software and trade name, respectively. In April 2023, the Company acquired businessfourzero and recorded customer relationships and trade name intangible assets in the Heidrick Consulting operating segment of $3.5 million and $0.5 million, respectively. The combined estimated weighted-average amortization period for the acquired intangible assets is 8.3 years with estimated amortization periods of 9.0 and 3.0 years for the customer relationships and trade name intangible assets, respectively. The carrying amount of amortizable intangible assets and the related accumulated amortization were as follows:
|  |  |  | December 31, 2023 |  | December 31, 2022
|  | Weighted Average Life (in years) |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount
Client relationships |  | 9.9 |  | $ | 26,195 |  |  | $ | (11,443) |  |  | $ | 14,752 |  |  | $ | 10,720 |  |  | $ | (6,164) |  |  | $ | 4,556 |
Trade name |  | 3.0 |  | 5,067 |  |  | (3,069) |  |  | $ | 1,998 |  |  | 2,406 |  |  | (1,925) |  |  | 481 |
Software |  | 3.0 |  | 8,629 |  |  | (4,537) |  |  | 4,092 |  |  | 3,110 |  |  | (1,814) |  |  | 1,296 |
Total intangible assets |  | 7.9 |  | $ | 39,891 |  |  | $ | (19,049) |  |  | $ | 20,842 |  |  | $ | 16,236 |  |  | $ | (9,903) |  |  | $ | 6,333 |
Intangible asset amortization expense for the years ended December 31, 2023, 2022, and 2021, was $9.4 million, $3.2 million and $2.9 million, respectively. The Company's estimated future amortization expense related to intangible assets as of December 31, 2023, for the years ended December 31, is as follows:
2024 | $ | 7,780 |
2025 | 5,971 |
2026 | 2,525 |
2027 | 1,534 |
2028 | 897 |
Thereafter | 2,135 |
Total | $ | 20,842 |

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 -Topic 350 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//350/tableOfContent + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration