Goodwill and Other Intangible Assets

6 Months Ended

Jun. 27, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and other intangible assets included in the Condensed Consolidated Balance Sheets consisted of the following (in thousands):


	June 27, 2020		December 28, 2019
Goodwill	$	259,777	$	270,820
Definite-lived intangible assets	129,938		146,040
Indefinite-lived intangible assets	26,602		28,849
Total goodwill and other intangible assets	$	416,317	$	445,709

Goodwill

The changes in the carrying amount of goodwill, by reporting segment, are as follows (in thousands):


	Workplace Furnishings		Residential Building Products		Total
Balance as of December 28, 2019
Goodwill	$	128,677	$	186,662	$	315,339
Accumulated impairment losses	(44,376)		(143)		(44,519)
Net goodwill balance as of December 28, 2019	84,301		186,519		270,820

Goodwill acquired	—		10,537		10,537
Impairment losses	(21,607)		—		(21,607)
Foreign currency translation adjustment	27		—		27

Balance as of June 27, 2020
Goodwill	128,704		197,199		325,903
Accumulated impairment losses	(65,983)		(143)		(66,126)
Net goodwill balance as of June 27, 2020	$	62,721	$	197,056	$	259,777

In the first quarter of 2020, the Corporation recorded goodwill impairment charges of $14.1 million and $7.5 million, respectively, related to two reporting units in the workplace furnishings segment.

See "Note 3. Acquisitions" for additional information regarding goodwill acquired in the year-to-date period.

Definite-lived intangible assets

The table below summarizes amortizable definite-lived intangible assets, which are reflected in "Goodwill and Other Intangible Assets" in the Condensed Consolidated Balance Sheets (in thousands):


	June 27, 2020										December 28, 2019
	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net
Patents	$	—	$	—	$	—	$	40	$	40	$	—
Software	173,293		68,686		104,607		176,836		67,541		109,295
Trademarks and trade names	6,564		3,274		3,290		7,564		3,381		4,183
Customer lists and other	81,110		59,069		22,041		104,004		71,442		32,562
Net definite-lived intangible assets	$	260,967	$	131,029	$	129,938	$	288,444	$	142,404	$	146,040

In the first quarter of 2020, the Corporation recorded impairment charges of $0.6 million and $8.2 million, related to definite-lived tradenames and customer lists, respectively, in the workplace furnishings segment.

Amortization expense is reflected in "Selling and administrative expenses" in the Condensed Consolidated Statements of Comprehensive Income and was as follows (in thousands):


	Three Months Ended						Six Months Ended
	June 27, 2020		June 29, 2019		June 27, 2020		June 29, 2019
Capitalized software	$	4,828	$	4,612	$	9,378	$	9,207
Other definite-lived intangibles	$	1,152	$	1,570	$	2,675	$	3,145

The occurrence of events such as acquisitions, dispositions, or impairments may impact future amortization expense. Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five years is as follows (in millions):


	2020		2021		2022		2023		2024
Amortization expense	$	24.0	$	23.1	$	20.1	$	16.8	$	15.1

Indefinite-lived intangible assets

The Corporation also owns certain intangible assets, which are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely. These indefinite-lived intangible assets are reflected in "Goodwill and Other Intangible Assets" in the Condensed Consolidated Balance Sheets (in thousands):


	June 27, 2020		December 28, 2019
Trademarks and trade names	$	26,602	$	28,849

In the first quarter of 2020, the Corporation recorded an impairment charge of $2.3 million, related to an indefinite-lived tradename in the workplace furnishings segment. The remaining immaterial change in the indefinite-lived intangible assets balances shown above is related to foreign currency translation impacts.

Impairment Analysis

The Corporation evaluates its goodwill and indefinite-lived intangible assets for impairment on an annual basis during the fourth quarter, or whenever indicators of impairment exist. The Corporation also evaluates long-lived assets (which include definite-lived intangible assets) for impairment if indicators exist.

In the first quarter of 2020, the Corporation determined that a triggering event occurred, resulting in quantitative impairment tests performed over the goodwill, indefinite-lived intangible assets, and long-lived asset groups related to three reporting units in the workplace furnishings segment. This determination was made considering the reduced sales and profitability projections for these reporting units, driven by the COVID-19 pandemic and related economic disruption. The resulting impairment charges recorded in the first quarter of 2020, as described in the preceding sections, are reflected in "Impairment and restructuring charges" in the Condensed Consolidated Statements of Comprehensive Income. For further information, refer to "Note 5. Goodwill and Other Intangible Assets" included in the Corporation's Quarterly Report on Form 10-Q for the fiscal quarter ended March 28, 2020.

No additional triggering events occurred and no impairment charges were recorded during the second quarter of 2020.