Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

The Company has four reporting units to which goodwill is allocated: steel, on-board weighing, DSI, and DTS.

For the steel and on-board weighing goodwill reporting units, the Company performed the qualitative assessment, which included assessment of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, and other entity specific events which could impact the reporting unit. Based on this review, it was determined that the fair value of each of those reporting units was in excess of its carrying value and therefore no quantitative impairment test was required.

For the DSI and DTS goodwill reporting units, the Company performed the quantitative impairment test. In estimating the fair value of our DSI and DTS reporting units the Company used the income approach. The income approach to valuation requires management to make significant estimates and assumptions related to future revenues, profitability, working capital requirements and selection of discount rate and long term growth rate. Changes in these estimates and assumptions could have a significant impact on the fair value of the reporting units.

The Company's required goodwill and indefinite-lived asset annual impairment test is completed as of the first day of the fourth fiscal quarter each year. In 2023, the results of the quantitative impairment test for the DSI and DTS reporting units indicated that the fair value of both reporting units exceeded their carrying values, and therefore no impairment was recognized.

Prior to 2022, the Company also had an instrumentation reporting unit. The Company's analysis in 2021 resulted in an impairment for the instrumentation reporting unit, of $1.1 million in goodwill, which represented the remainder of the goodwill balance, and $0.1 million in indefinite-lived intangible trade name.

The change in the carrying value of goodwill by segment is as follows (in thousands):


	Total		Measurement Systems				Weighing Solutions
			KELK Acquisition		DSI Acquisition		DTS Acquisition		Stress-Tek Acquisition
Balance at January 1, 2022	$	45,830	$	6,706	$	16,910	$	15,903	$	6,311
Adjustment to goodwill acquired	130		—		—		130		—
Foreign currency translation adjustment	(416)		(393)		(23)		—		—
Balance at December 31, 2022	45,544		6,313		16,887		16,033		6,311
Foreign currency translation adjustment	190		175		15		—		—
Balance at December 31, 2023	$	45,734	$	6,488	$	16,902	$	16,033	$	6,311

Intangible assets were as follows (in thousands):


	December 31,
	2023		2022
Intangible assets subject to amortization
(Definite-lived):
Patents and acquired technology	$	32,752	$	32,570
Customer relationships	33,537		33,226
Trade names	1,517		1,521
Non-competition agreements	9,956		10,133
	77,762		77,450
Accumulated amortization:
Patents and acquired technology	(11,048)		(9,059)
Customer relationships	(18,306)		(16,209)
Trade names	(1,517)		(1,521)
Non-competition agreements	(9,939)		(10,098)
	(40,810)		(36,887)
Net intangible assets subject to amortization	$	36,952	$	40,563

Intangible assets not subject to amortization
(Indefinite-lived):
Trade names	7,682		7,654

	$	44,634	$	48,217

Certain intangible assets are subject to foreign currency translation.

Amortization expense was $3.8 million, $3.9 million, and $3.3 million, for the years ended December 31, 2023, 2022, and 2021, respectively.

Estimated annual amortization expense for each of the next five years is as follows (in thousands):


2024	$	3,722
2025	3,705
2026	3,705
2027	3,669
2028	3,081