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Intangible Assets
6 Months Ended
Jun. 30, 2021
Goodwill And Intangible Assets Disclosure [Abstract]  
Intangible Assets

7. Intangible Assets

The following table presents intangible assets (in thousands) as of:

 

 

 

June 30, 2021

 

 

December 31, 2020

 

 

 

Gross

Carrying

Amount

 

 

Accumulated Amortization

 

 

Gross

Carrying

Amount

 

 

Accumulated Amortization

 

Customer relationships

 

$

1,534,268

 

 

$

(205,237

)

 

$

195,435

 

 

$

(94,690

)

Trade names

 

 

185,361

 

 

 

(95,783

)

 

 

52,061

 

 

 

(38,138

)

Subcontractor relationships

 

 

5,440

 

 

 

(2,851

)

 

 

5,440

 

 

 

(1,944

)

Non-compete agreements

 

 

3,719

 

 

 

(2,268

)

 

 

3,719

 

 

 

(2,001

)

Total intangible assets

 

$

1,728,788

 

 

$

(306,139

)

 

$

256,655

 

 

$

(136,773

)

 

In connection with the BMC Merger and John’s Lumber acquisition, we recorded intangible assets of $1,472.6 million, which includes $1,339.3 million of customer relationships and $133.3 million of trade names. The weighted average useful lives of the acquired intangible assets are 11.3 years in total, 11.4 years for customer relationships and 5.5 years for trade names, respectively. The fair value of acquired intangible assets was estimated by applying an income approach. That measure is based on significant Level 3 inputs not observable in the market. Key assumptions developed based on the Company’s historical experience, future projections and comparable market data include future cash flows, long-term growth rates, attrition rates and discount rates.

 

In connection with the disposal of our gypsum stand-alone operations, we reclassified $0.5 million of intangible assets to held-for-sale assets as of June 30, 2021. Refer to Note 2 – Business Combinations and Dispositions for additional information.

 

During the three and six months ended June 30, 2021, we recorded amortization expense in relation to the above-listed intangible assets of $80.6 million and $169.3 million, respectively. During the three and six months ended June 30, 2020, we recorded amortization expense in relation to the above-listed intangible assets of $5.6 million and $11.3 million, respectively.

 

The following table presents the estimated amortization expense for intangible assets for the years ending December 31 (in thousands):

 

2021 (from July 1, 2021)

 

$

168,905

 

2022

 

 

200,574

 

2023

 

 

174,217

 

2024

 

 

153,359

 

2025

 

 

134,723

 

Thereafter

 

 

590,871

 

Total future net intangible amortization expense

 

$

1,422,649