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Goodwill and Intangibles | 12 Months Ended
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Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangibles | GOODWILL AND INTANGIBLES Goodwill In the first quarter of 2022, we changed our operating segments to align with recent changes in our business, resulting in three operating segments: Installation, Manufacturing and Distribution. Our Installation operating segment remains our one reportable segment and our Manufacturing and Distribution operating segments are combined into our Other category. We also determined that our reporting units are at the operating segment level. See Note 11, Information on Segments, for additional details about our change in segment structure. Prior to this change, goodwill was combined into one reporting unit as reflected in the table below for the year ended December 31, 2021. Effective January 1, 2022, we reassigned our goodwill to each of our three reporting units using a relative fair value approach. The change in carrying amount of goodwill by reportable segment for the year ended December 31, 2021 was as follows (in thousands):
|  |  |  |  | Installation
Goodwill (gross) - January 1, 2021 |  |  |  |  | $ | 286,874 |
Business combinations |  |  |  |  | 105,617 |
Other additions |  |  |  |  | 30 |
Goodwill (gross) - December 31, 2021 |  |  |  |  | 392,521 |
Accumulated impairment losses |  |  |  |  | (70,004) |
Goodwill (net) - December 31, 2021 |  |  |  |  | $ | 322,517 |
The change in carrying amount of goodwill by reportable segment after the assignment of goodwill as noted above for the year ended December 31, 2022 was as follows (in thousands):
| Installation |  | Other |  | Consolidated
Goodwill (gross) - January 1, 2022, after change in reporting units | $ | 331,782 |  |  | $ | 60,739 |  |  | $ | 392,521 |
Business combinations | 21,700 |  |  | 27,594 |  |  | 49,294 |
Other additions | 1,744 |  |  | — |  |  | 1,744 |
Goodwill (gross) - December 31, 2022 | 355,226 |  |  | 88,333 |  |  | 443,559 |
Accumulated impairment losses | (70,004) |  |  | — |  |  | (70,004) |
Goodwill (net) - December 31, 2022 | $ | 285,222 |  |  | $ | 88,333 |  |  | $ | 373,555 |
Other additions for the Installation segment included in the above table for the year ended December 31, 2022 include an adjustment to a prior year acquisition still within its measurement period of approximately $1.6 million. We also made other minor adjustments for the allocation of certain acquisitions still under measurement which are included as other additions in the above table for the Installation segment for the years ended December 31, 2022 and 2021. For additional information regarding changes to goodwill resulting from acquisitions, see Note 18, Business Combinations. On October 1, 2022, our measurement date, we tested goodwill for impairment by reporting unit. We have the option to either assess goodwill for impairment by performing a qualitative assessment to determine whether it is more likely than not that the fair value is less than its carrying value, or to bypass the qualitative evaluation and perform a quantitative assessment. For the Installation and Manufacturing reporting units, we performed a one-step qualitative assessment in conformity with generally accepted accounting principles and determined that no impairment of goodwill was required. We considered the impacts of the COVID-19 pandemic in our analysis and concluded there were no associated impairment indicators. We performed a quantitative assessment for our Distribution reporting unit. This assessment determined the fair value of the distribution reporting unit by weighting a discounted cash flow model and a market-related model in consultation with an external valuation expert. Upon comparison of the calculated fair value to the carrying value of the reporting unit, it was determined no impairment of goodwill needed to be recognized for the year ended December 31, 2022. In addition, no impairment of goodwill was recognized for the years ended December 31, 2021 or 2020. Accumulated impairment losses included within the above table were incurred over multiple periods, with the latest impairment charge being recorded during the year ended December 31, 2010. These accumulated losses were assigned to our Installation reporting unit. Intangibles, net The following table provides the gross carrying amount, accumulated amortization and net book value for each major class of intangibles (in thousands):
| As of December 31,
| 2022 |  | 2021
| Gross Carrying Amount |  | Accumulated Amortization |  | Net Book Value |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Book Value
Amortized intangibles: |  |  |  |  |  |  |  |  |  |  |
Customer relationships | $ | 338,050 |  |  | $ | 145,722 |  |  | $ | 192,328 |  |  | $ | 292,113 |  |  | $ | 113,849 |  |  | $ | 178,264 |
Covenants not-to-compete | 30,899 |  |  | 20,086 |  |  | 10,813 |  |  | 27,717 |  |  | 16,471 |  |  | 11,246 |
Trademarks and tradenames | 119,612 |  |  | 39,638 |  |  | 79,974 |  |  | 103,007 |  |  | 32,623 |  |  | 70,384 |
Backlog | 20,815 |  |  | 20,457 |  |  | 358 |  |  | 23,724 |  |  | 19,197 |  |  | 4,527 |
| $ | 509,376 |  |  | $ | 225,903 |  |  | $ | 283,473 |  |  | $ | 446,561 |  |  | $ | 182,140 |  |  | $ | 264,421 |
We recorded no intangible asset impairment loss for the years ended December 31, 2022, 2021 and 2020. The gross carrying amount of intangibles increased approximately $62.8 million and $130.1 million during the years ended December 31, 2022 and 2021, respectively. Intangibles associated with business combinations accounted for approximately $65.1 million and $130.0 million of the increases during the years ended December 31, 2022 and 2021, respectively. For the year ended December 31, 2022, there was a measurement period adjustment for a prior year acquisition that decreased gross intangibles by $3.0 million. For more information, see Note 18, Business Combinations. Amortization expense on intangible assets totaled approximately $43.8 million, $37.1 million, and $28.5 million during the years ended December 31, 2022, 2021 and 2020, respectively. Remaining estimated aggregate annual amortization expense is as follows (in thousands):
2023 | $ | 42,460 |
2024 | 38,366 |
2025 | 32,961 |
2026 | 29,010 |
2027 | 24,724 |
Thereafter | 115,952 |

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