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Goodwill and Other Intangible Assets | 12 Months Ended
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Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The Company performs its annual testing of goodwill and indefinite-lived intangibles in the fourth quarter of each year. Between annual testing dates, the Company monitors factors such as its market capitalization, comparable company market multiples and macroeconomic conditions to identify conditions that could impact the Company’s assumptions utilized in the determination of the estimated fair values of the Company’s reporting units and indefinite-lived intangible assets significantly enough to trigger an impairment. The goodwill impairment tests are based on determining the fair value of the specified reporting units based on management judgements and assumptions using the discounted cash flows under the income approach classified in Level 3 of the fair value hierarchy and comparable company market valuation classified in Level 2 of the fair value hierarchy approaches. The Company has identified Global Ceramic, Flooring NA and Flooring ROW as its reporting units for the purposes of allocating goodwill and intangibles as well as assessing impairments. The valuation approaches are subject to key judgments and assumptions that are sensitive to change such as judgements and assumptions about appropriate sales growth rates, operating margins, WACC and comparable company market multiples. As a result of a decrease in the Company’s market capitalization, comparable company market multiples, projected future cash flows and an increase in the WACC due to increases in the risk free rate and applicable risk premiums, the Company determined that a triggering event occurred requiring goodwill impairment testing for each of its reporting units as of October 1, 2022. The impairment test indicated a pre-tax, non-cash goodwill impairment charge related to the Global Ceramic reporting unit of $688,514 ($679,664 net of tax), which the Company recorded during the third quarter of 2022. The Company concluded the goodwill of its other reporting units was not impaired on October 1, 2022. In addition, the Company compared the estimated fair values of its indefinite-lived intangibles to their carrying values and determined that there were impairments of $7,257 ($5,939 net of tax) in the Flooring ROW and Flooring NA reporting units during the third quarter of 2022. The excess of fair value over carrying value for the Flooring ROW reporting unit was approximately 20% and the excess of fair value over carrying value for the Flooring NA reporting unit was less than 5%, as of October 1, 2022. The Company’s annual testing date for goodwill and tradenames is the first day of its fourth quarter and due to the fact that there were no significant changes in facts or circumstances in the one calendar day, the Company determined there was no additional impairment of goodwill or tradenames. The Company conducted a qualitative analysis as of December 31, 2022 and determined there was no indication of an impairment. A significant or prolonged deterioration in economic conditions, continued increases in the costs of raw materials and energy combined with an inability to pass these costs on to customers, a further decline in the Company’s market capitalization or comparable company market multiples, a reduction in projected future cash flows, or increases in the WACC, could impact the Company’s assumptions and require a reassessment of goodwill or indefinite-lived intangible assets for impairment in future periods. The following tables summarize the components of goodwill and intangible assets: Goodwill:
| Global Ceramic |  | Flooring NA |  | Flooring ROW |  | Total
Balances as of December 31, 2020 (1) | $ | 1,047,561 |  |  | 531,144 |  |  | 1,072,126 |  |  | 2,650,831 |
Goodwill recognized during the period | — |  |  | — |  |  | 56,930 |  |  | 56,930 |
Currency translation during the period | (16,224) |  |  | — |  |  | (83,628) |  |  | (99,852) |
Balances as of December 31, 2021 (1) | 1,031,337 |  |  | 531,144 |  |  | 1,045,428 |  |  | 2,607,909 |
Goodwill adjustments related to acquisitions | — |  |  | — |  |  | (2,722) |  |  | (2,722) |
Goodwill recognized during the period | — |  |  | 60,841 |  |  | 11,542 |  |  | 72,383 |
Impairment charge during the period | (688,514) |  |  | — |  |  | — |  |  | (688,514) |
Currency translation during the period | (2,989) |  |  | — |  |  | (58,308) |  |  | (61,297) |
Balances as of December 31, 2022 | $ | 339,834 |  |  | 591,985 |  |  | 995,940 |  |  | 1,927,759 |
(1) Net of accumulated impairment losses of $1,327,425 ($531,930 in Global Ceramic, $343,054 in Flooring NA and $452,441 in Flooring ROW). Intangible assets:
| Tradenames
Indefinite life assets not subject to amortization: |
Balance as of December 31, 2020 | $ | 727,268 |
Intangible assets acquired during the year | 2,725 |
Currency translation during the year | (35,088) |
Balance as of December 31, 2021 | 694,905 |
Intangible assets acquired during the year | 335 |
Intangible assets impaired during the year | (7,257) |
Currency translation during the year | (19,655) |
Balance as of December 31, 2022 | $ | 668,328 |
| Customer relationships |  | Patents |  | Other |  | Total
Intangible assets subject to amortization: |  |  |  |  |  |  |
Balances as of December 31, 2020 |  |  |  |  |  |  |
Gross carrying amount | $ | 699,795 |  |  | 273,570 |  |  | 6,945 |  |  | 980,310 |
Accumulated amortization | (481,256) |  |  | (273,426) |  |  | (1,289) |  |  | (755,971) |
Net intangible assets subject to amortization | 218,539 |  |  | 144 |  |  | 5,656 |  |  | 224,339 |
Balances as of December 31, 2021 |  |  |  |  |  |  |
Gross carrying amount | 680,177 |  |  | 256,336 |  |  | 6,786 |  |  | 943,299 |
Accumulated amortization | (483,748) |  |  | (252,414) |  |  | (2,062) |  |  | (738,224) |
Net intangible assets subject to amortization | 196,429 |  |  | 3,922 |  |  | 4,724 |  |  | 205,075 |
Balances as of December 31, 2022 |  |  |  |  |  |  |
Gross carrying amount | 673,586 |  |  | 242,089 |  |  | 8,511 |  |  | 924,186 |
Accumulated amortization | (493,361) |  |  | (239,010) |  |  | (2,195) |  |  | (734,566) |
Net intangible assets subject to amortization | $ | 180,225 |  |  | 3,079 |  |  | 6,316 |  |  | 189,620 |
| Years Ended December 31,
| 2022 |  | 2021 |  | 2020
Amortization expense | $ | 28,086 |  |  | 29,280 |  |  | 28,891 |
Estimated amortization expense for the years ending December 31 are as follows:
2023 | $ | 28,049 |
2024 | 27,334 |
2025 | 27,117 |
2026 | 26,896 |
2027 | 19,972 |

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- 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 https://asc.fasb.org/topic&trid=2144416 + Details
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