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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 | 4. Goodwill and Other Intangible Assets The changes in the carrying value of goodwill for the years ended December 31, 2022 and 2021, were as follows:
|  | Surfactants Segment |  |  | Polymer Segment |  |  | Specialty Products Segment |  |  | Total |
(In thousands) |  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Balance as of January 1 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  | $ | 25,689 |  |  | $ | 25,537 |  |  | $ | 74,482 |  |  | $ | 5,419 |  |  | $ | 483 |  |  | $ | 483 |  |  | $ | 100,654 |  |  | $ | 31,439 |
Accumulated impairment loss |  |  | (3,467 | ) |  |  | (3,467 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (3,467 | ) |  |  | (3,467 | )
Goodwill, net |  |  | 22,222 |  |  |  | 22,070 |  |  |  | 74,482 |  |  |  | 5,419 |  |  |  | 483 |  |  |  | 483 |  |  |  | 97,187 |  |  |  | 27,972 |
Goodwill acquired (1) |  |  | 1,792 |  |  |  | — |  |  |  | — |  |  |  | 72,467 |  |  |  | — |  |  |  | — |  |  |  | 1,792 |  |  |  | 72,467 |
Goodwill measurement period adjustment (1) |  |  | — |  |  |  | 940 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 940 |
Goodwill impairment |  |  | (978 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (978 | ) |  |  | — |
Foreign currency translation |  |  | 656 |  |  |  | (788 | ) |  |  | (2,735 | ) |  |  | (3,404 | ) |  |  | — |  |  |  | — |  |  |  | (2,079 | ) |  |  | (4,192 | )
Balance as of December 31 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  | 28,137 |  |  |  | 25,689 |  |  |  | 71,747 |  |  |  | 74,482 |  |  |  | 483 |  |  |  | 483 |  |  |  | 100,367 |  |  |  | 100,654 |
Accumulated impairment loss |  |  | (4,445 | ) |  |  | (3,467 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,445 | ) |  |  | (3,467 | )
Goodwill, net |  | $ | 23,692 |  |  | $ | 22,222 |  |  | $ | 71,747 |  |  | $ | 74,482 |  |  | $ | 483 |  |  | $ | 483 |  |  | $ | 95,922 |  |  | $ | 97,187 |
(1) See Note 20, Acquisitions, of the notes to the Company’s consolidated financial statements (included in Item 8 of this Form 10-K) for information regarding the goodwill acquired in a business combination. The Company typically tests its goodwill balances for impairment in the second quarter of each calendar year. Testing is completed more frequently when triggering events or changes in circumstances indicate it is more likely than not that the fair value of a reporting unit to which goodwill relates has declined below its carrying value. During the second quarter of 2022 the Company completed its annual goodwill impairment testing and concluded that the goodwill related to its Philippines reporting unit was impaired. The Philippines reporting unit is part of the Company’s Surfactant segment. Goodwill impairment was recognized as a result of the reporting unit’s fair value declining below its carrying value. The Company estimates the fair value of each of its reporting units based on the average of market and income-based computations. The Philippines impairment primarily resulted from lost market share at one major customer combined with higher unit overhead costs. The Company recorded a non-cash charge of $978,000 in the Consolidated Statements of Income for the year ended December 31, 2022. The impairment charge equaled the entire balance of the Philippines’ goodwill. The Company concluded that there was no goodwill impairment at any of its other reporting units based on its quantitative testing completed during the second quarter of 2022 and its qualitative assessment at the year end. The following table presents the components of other intangible assets, all of which have finite lives, as of December 31, 2022 and 2021. The year-over-year changes in gross carrying values mainly resulted from the acquisition that took place in 2022 and the effects of foreign currency translation.
|  | Gross Carrying Value |  |  | Accumulated Amortization |
|  | December 31 |  |  | December 31 |
(In thousands) |  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Other Intangible Assets: |  |  |  |  |  |  |  |  |  |  |  |
Patents (2) |  | $ | 7,411 |  |  | $ | 7,411 |  |  | $ | 6,363 |  |  | $ | 6,139 |
Non-compete agreements (2) |  |  | 635 |  |  |  | 594 |  |  |  | 548 |  |  |  | 404 |
Trademarks (2) |  |  | 11,384 |  |  |  | 12,013 |  |  |  | 5,346 |  |  |  | 4,160 |
Customer lists/relationships (2) |  |  | 46,972 |  |  |  | 44,447 |  |  |  | 12,491 |  |  |  | 9,557 |
Supply contract |  |  | 1,551 |  |  |  | 1,472 |  |  |  | 1,551 |  |  |  | 1,472 |
Know-how (1)(2) |  |  | 28,908 |  |  |  | 27,029 |  |  |  | 12,536 |  |  |  | 10,450 |
Total |  | $ | 96,861 |  |  | $ | 92,966 |  |  | $ | 38,835 |  |  | $ | 32,182 |
(1) Know-how includes intellectual property rights covering proprietary information, written formulae, trade secrets or secret processes, inventions and developmental products (whether patentable or not), discoveries, improvements, compositions, manufacturing processes, manuals, specifications and technical data. (2) The 2021 balances include intangible assets acquired as part of the Company’s acquisition of INVISTA’s aromatic polyester polyol business and associated assets in January 2021 and the Company’s fermentation plant acquisition in February 2021. The 2022 balances include intangible assets acquired as part of the Company’s PerformanX acquisition in September 2022. See Note 20, Acquisitions, of the notes to the Company’s consolidated financial statements (included in Item 8 of this Form 10-K) for additional details. Aggregate amortization expense for the years ended December 31, 2022, 2021 and 2020, was $6,835,000, $7,292,000, and $3,621,000, respectively. The Company typically recognizes amortization expense within the Cost of Sales line item on the income statement. Estimated amortization expense for identifiable intangibles assets for each of the five succeeding fiscal years is as follows:
(In thousands) |  |  |
For year ended 12/31/23 |  | $ | 7,237 |
For year ended 12/31/24 |  |  | 6,950 |
For year ended 12/31/25 |  |  | 6,509 |
For year ended 12/31/26 |  |  | 6,186 |
For year ended 12/31/27 |  |  | 6,106 |

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