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Note 5 - Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Text Block]

5.	*Goodwill and Intangible Assets:*

The Company's intangible assets were recorded in connection with its acquisitions of Metal-Fab and CTB in 2023, Shaw Stainless & Alloy, Inc. (Shaw) in 2021, Action Stainless & Alloys, Inc. (Action Stainless) in 2020, EZ Dumper® hydraulic dump inserts (EZ Dumper) and McCullough Industries (McCullough) in 2019, Berlin Metals, LLC (Berlin Metals) in 2018 and Chicago Tube and Iron (CTI) in 2011. The intangible assets were evaluated on the premise of highest and best use to a market participant, primarily utilizing the income approach valuation methodology.

Goodwill, by reportable unit, was as follows as of June 30, 2024 and December 31, 2023, respectively. The goodwill is deductible for tax purposes.

	Carbon Flat		Specialty Metals		Tubular and
(in thousands)	Products		Flat Products		Pipe Products		Total
Balance as of December 31, 2023	$	34,259	$	9,431	$	8,401	$	52,091
Acquisitions		-		-		-		-
Impairments		-		-		-		-
Balance as of June 30, 2024	$	34,259	$	9,431	$	8,401	$	52,091

Intangible assets, net, consisted of the following as of June 30, 2024 and December 31, 2023, respectively:

	*As of June 30, 2024*
	Gross Carrying		Accumulated			Intangible
(in thousands)	Amount		Amortization			Assets, Net
Customer relationships - subject to amortization	$	62,559	$	(16,756	)	$	45,803
Covenant not to compete - subject to amortization		2,339		(887	)		1,452
Technology and know-how - subject to amortization		7,000		(649	)		6,351
Trade name - not subject to amortization		36,868		-			36,868
	$	108,766	$	(18,292	)	$	90,474

	*As of December 31, 2023*
	Gross Carrying		Accumulated			Intangible
(in thousands)	Amount		Amortization			Assets, Net
Customer relationships - subject to amortization	$	62,559	$	(15,084	)	$	47,475
Covenant not to compete - subject to amortization		2,339		(679	)		1,660
Technology and know-how - subject to amortization		7,000		(382	)		6,618
Trade name - not subject to amortization		36,868		-			36,868
	$	108,766	$	(16,145	)	$	92,621

The Company estimates that amortization expense for its intangible assets subject to amortization will be approximately $4.3 million per year for the next two years, $3.8 million the following year and then $3.3 million and $3.0 million, respectively, over the next two years.