Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure

GOODWILL AND INTANGIBLE ASSETS

Goodwill

Goodwill by reporting unit and changes in the carrying amount are as follows:


	Franchise Group		Owned Brokerage Group		Title Group		Total Company
Balance at December 31, 2021	$	2,506	$	259	$	158	$	2,923
Goodwill acquired (a)	—		14		5		19
Goodwill reduction for sale of a business (b)	—		—		(32)		(32)
Balance at June 30, 2022	$	2,506	$	273	$	131	$	2,910

Accumulated impairment losses (c)	$	1,447	$	808	$	324	$	2,579

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(a)Goodwill acquired during the six months ended June 30, 2022 relates to the acquisition of three real estate brokerage operations and two title and settlement operations.

(b)Goodwill reduction relates to the sale of the Title Underwriter during the first quarter of 2022 (see Note 1, "Basis of Presentation", for a description of the transaction).

(c)Includes impairment charges which reduced goodwill by $540 million during 2020, $253 million during 2019, $1,279 million during 2008 and $507 million during 2007.

Brokerage Acquisitions

The Company acquired three real estate brokerage operations through Owned Brokerage Group, for aggregate cash consideration of $13 million and established $6 million of contingent consideration. These acquisitions resulted in goodwill of $14 million, other intangibles of $5 million, other assets of $26 million and other liabilities of $26 million.

None of the acquisitions were significant to the Company’s results of operations, financial position or cash flows individually or in the aggregate.

Intangible Assets

Intangible assets are as follows:


	As of June 30, 2022						As of December 31, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizable—Franchise agreements (a)	$	2,010	$	1,022	$	988	$	2,010	$	989	$	1,021
Indefinite life—Trademarks (b)	$	687			$	687	$	687			$	687
Other Intangibles
Amortizable—License agreements (c)	$	45	$	14	$	31	$	45	$	14	$	31
Amortizable—Customer relationships (d)	456		355		101		456		345		111
Indefinite life—Title plant shares (e)	24				24		25				25
Amortizable—Other (f)	15		12		3		16		12		4
Total Other Intangibles	$	540	$	381	$	159	$	542	$	371	$	171

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(a)Generally amortized over a period of 30 years.

(b)Primarily related to real estate franchise brands, title and relocation tradenames which are expected to generate future cash flows for an indefinite period of time.

(c)Relates to the Sotheby’s International Realty® and Better Homes and Gardens® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements).

(d)Relates to the customer relationships at Franchise Group, Title Group and Owned Brokerage Group. These relationships are being amortized over a period of 7 to 20 years.

(e)Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time.

(f)Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years.

Intangible asset amortization expense is as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Franchise agreements	$	16	$	17	$	33	$	34
Customer relationships	5		5		10		11
Other	4		1		6		1
Total	$	25	$	23	$	49	$	46

Based on the Company’s amortizable intangible assets as of June 30, 2022, the Company expects related amortization expense for the remainder of 2022, the four succeeding years and thereafter to be approximately $47 million, $89 million, $89 million, $89 million, $89 million and $720 million, respectively.