Goodwill

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

The Company evaluates goodwill for impairment at least annually during the fourth quarter or whenever events or changes in circumstances indicate that an evaluation should be completed. The Company determines the fair value of its reporting units using the income approach. The determination of the fair value using the income approach requires management to make significant estimates and assumptions related to forecasts of future cash flows and discount rates. Changes to the forecasted revenue growth, earnings before income taxes, depreciation and amortization (“EBITDA”) and discount rate assumptions may result in a significantly different estimate of the fair value of the reporting units, which could result in a different assessment of the recoverability of goodwill or measurement of an impairment charge.

Effective July 1, 2023, and as a result of our ongoing integration efforts, we identified a change in our operating segments. While the ATM reportable segment remains as an aggregation of the Company’s highly engineered polymer, resin and fiber-based substrates, nets, films, adhesive tapes, and other non-woven products, the segment was disaggregated into five reporting units due to changes in internal reporting of operating results and related segment level management. Refer to Note 21. Segment Information for additional information on our segments.

Further, during 2023, the sustained impact of macro-economic conditions, an increasingly global competitive environment, moderation in certain projected volume expectations, and a sustained decrease in our share price contributed to the decline in reporting unit fair value. Additionally, management completed a long-term financial model, aligning with the new reporting unit structure during the third quarter. That model’s forecast reflects the higher relative allocation of corporate overhead costs to continuing operations as a result of the proposed sale of our EP business.

As a result, during the year ended December 31, 2023, the Company performed an interim quantitative goodwill impairment test, which resulted in an impairment charge of $401.0 million related to certain reporting units included in the Advanced Technical Materials (“ATM”) reportable segment. The annual tests during the fourth quarters of 2023, 2022 and 2021 resulted in no impairment.

The changes in the carrying amount of goodwill for each reporting segment were as follows (in millions):


	ATM		FBS		Total
Balance at December 31, 2021	$	643.4	$	1.6	$	645.0
Goodwill acquired(1)	215.8		—		215.8
Foreign currency translation and other(2)	(16.6)		—		(16.6)
Balance at December 31, 2022	$	842.6	$	1.6	$	844.2
Goodwill acquired(3)	16.0		—		16.0
Goodwill impairment(4)	(401.0)		—		(401.0)
Foreign currency translation and other	14.9		—		14.9
Balance at December 31, 2023	$	472.5	$	1.6	$	474.1

(1) $214.4 million related to the Merger and $1.4 million related to measurement period adjustments for the Scapa acquisition.

(2) During the first quarter of 2022, goodwill with a carrying amount of $2.1 million was allocated to the disposal group classified as held for sale and subsequently impaired. Goodwill was allocated to the disposal group on the basis of relative fair value, primarily utilizing Level 3 inputs which included forecasted future cash flows.

(3) Related to the measurement period adjustments for the Merger.

(4) Recorded in the third quarter of 2023.

Accumulated impairment loss for the FBS segment was $2.7 million as of December 31, 2023 and 2022. Accumulated impairment loss for the ATM segment was $401.0 million as of December 31, 2023 and there was no accumulated impairment loss as of December 31, 2022.