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Property Plant and Equipment and Intangible Assets | 9 Months Ended
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Sep. 27, 2024
Property, Plant and Equipment [Abstract] |
Property, Plant and Equipment and Intangible Assets | Note 5. Property, Plant and Equipment and Intangible Assets The following tables summarize the components of property, plant and equipment as of September 27, 2024 and December 29, 2023 and depreciation expense for the three and nine months ended September 27, 2024 and September 29, 2023.
|  | September 27, |  |  | December 29, |
(In thousands) |  | 2024 |  |  | 2023 |
Building, land and leasehold improvements |  | $ | 171 |  |  | $ | 4,002 |
Machinery, equipment, and vehicles |  |  | 50,565 |  |  |  | 70,250 |
Office equipment, software and construction in progress |  |  | 7,093 |  |  |  | 9,324 |
Property, plant and equipment, gross |  |  | 57,829 |  |  |  | 83,576 |
Accumulated depreciation |  |  | (36,433 | ) |  |  | (37,203 | )
Property, plant and equipment, net |  | $ | 21,396 |  |  | $ | 46,373 |
|  | Three Months Ended |  |  | Nine Months Ended |
|  | September 27, |  |  | September 29, |  |  | September 27, |  |  | September 29, |
|  | 2024 |  |  | 2023 |  |  | 2024 |  |  | 2023 |
(In thousands) |  |  |  |  |  |  |  |  |  |  |  |
Depreciation expense |  | $ | 2,737 |  |  | $ | 3,604 |  |  | $ | 9,515 |  |  | $ | 10,687 |
Depreciation is recorded within cost of revenue and selling, general and administrative expenses and is calculated using the straight-line method over the estimated useful lives of the assets, or in the case of leasehold improvements and capitalized leases, the lesser of the remaining term of the lease or its estimated useful life. During the three months ended September 27, 2024, Shimmick completed the sale-leaseback of the Company's equipment yard in Tracy, California. The agreement consummated the sale of the equipment yard for $20.5 million and allows us to continue using the property pursuant to a separately executed seven-year lease. The Company received net proceeds of $17 million, after adjustments for prepaid rent through February 2026 and related closing costs, which were used to repay borrowings under the Revolving Credit Facility. As a result of the sale, the Company recorded a gain of $17 million in Gain on sale of assets within the condensed consolidated statements of operations. During the three months ended September 27, 2024, Shimmick made the strategic decision to enhance the Company’s current enterprise resource planning (ERP) system rather than implementing a new platform which, due to prior capitalized pre-implementation costs and remaining contractual obligations of $5 million included in accrued expenses in the accompanying condensed consolidated balance sheets, resulted in a one-time charge of $16 million recorded in the three months ended September 27, 2024. The write-off is recorded in ERP pre-implementation asset impairment and associated costs within the condensed consolidated statements of operations. The following tables present the Company’s finite-lived intangible assets, including the weighted average useful lives for each major intangible asset category and in total:
|  | September 27, 2024
(In thousands) |  | Weighted Average Remaining Useful Life in Years |  |  | Intangible Assets, Gross |  |  | Accumulated Amortization |  |  | Intangible Assets, Net |  |
Trademark |  |  | 3.3 |  |  | $ | 10,600 |  |  | $ | (5,679 | ) |  | $ | 4,921 |  |
Customer contracts |  |  | 2.3 |  |  |  | 6,373 |  |  |  | (3,982 | ) |  |  | 2,391 |  |
Total |  |  |  |  | $ | 16,973 |  |  | $ | (9,661 | ) |  | $ | 7,312 |  |
|  | December 29, 2023 |
(In thousands) |  | Weighted Average Remaining Useful Life in Years |  |  | Intangible Assets, Gross |  |  | Accumulated Amortization |  |  | Intangible Assets, Net |
Trademark |  |  | 4 |  |  | $ | 10,600 |  |  | $ | (4,543 | ) |  | $ | 6,057 |
Customer contracts |  |  | 3 |  |  |  | 6,527 |  |  |  | (3,340 | ) |  |  | 3,187 |
Total |  |  |  |  | $ | 17,127 |  |  | $ | (7,883 | ) |  | $ | 9,244 |
The Company’s estimated aggregate remaining amortization is as follows:
|  | Amortization |
(In thousands) |  | Expense |
2024 |  | $ | 644 |
2025 |  |  | 2,577 |
2026 |  |  | 2,577 |
2027 |  |  | 1,514 |
Total |  | $ | 7,312 |

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- Definition The entire disclosure for intangible assets and long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/360/tableOfContent + Details
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