Goodwill and Intangibles, Net

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

8. Goodwill and Intangibles, Net

On an annual basis, in the fourth quarter, the Company performs its goodwill impairment review in accordance with ASC 350. Estimating the fair value of a reporting unit requires various assumptions including projections of future cash flows, perpetual growth rates and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s assessment of a number of factors, including the reporting unit’s recent performance against budget, performance in the market that the reporting unit serves, and industry and general economic data from third-party sources. Discount rate assumptions are based on an assessment of the risk inherent in those future cash flows. Changes to the underlying businesses could affect the future cash flows, which in turn could affect the fair value of the reporting unit. After considering all quantitative and qualitative factors, the Company has determined that, other than noted below, it is more likely than not that the reporting units' fair values exceed their carrying values as of the assessment date. The Company also considered the current and expected future economic and market conditions surrounding the COVID-19 pandemic and its impact on each of the reporting units. Further, the Company assessed the current market capitalization, forecasts and the amount by which the fair values exceeded the carrying values.

Goodwill

The carrying amounts of goodwill by segment were as follows (in millions):


	Infrastructure		Spectrum		Total
Balance at December 31, 2020	$	89.6	$	21.4	$	111.0
Acquisition	16.7		—		16.7
Translation	(0.3)		—		(0.3)
Balance at December 31, 2021	$	106.0	$	21.4	$	127.4




Translation	(0.3)		—		(0.3)
Balance as of December 31, 2022	$	105.7	$	21.4	$	127.1

Indefinite-lived Intangible Assets

The carrying amounts of indefinite-lived intangible assets as of the periods indicated were as follows (in millions):


	December 31,
	2022		2021
FCC licenses	$	106.3	$	106.5

Total	$	106.3	$	106.5

For the years ended December 31, 2022 and 2021, the Company recorded impairment charges of $0.2 million and $0.7 million, respectively, which are reflected in Other operating loss in the Consolidated Statements of Operations. The impairment charges related to non-core FCC licenses which were sold or expired, in order to bring their carrying value equal to the agreed upon sales price prior to the execution of the sale or expiration.

The weighted-average period prior to the next renewal for FCC licenses was 6.6 years and 3.0 years as of December 31, 2022 and 2021, respectively, after taking into consideration licenses that were successfully renewed shortly after year-end. While broadcast television licenses are issued for a fixed period of time (generally eight years), renewals of these licenses have occurred routinely and at nominal cost. In addition, the Company does not believe that the expiration or non-renewal of any of our FCC licenses would have a material adverse effect on the expected future cash flows and profitability.

Definite Lived Intangible Assets

The gross carrying amounts and accumulated amortization of definite lived intangible assets by major intangible asset class as of the periods indicated were as follows (in millions):


		December 31,
	Weighted-Average Original Useful Life	2022							2021
		Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Trade names	14 years	$	25.4		$	(8.0)	$	17.4	$	25.4		$	(6.3)	$	19.1
Customer relationships and contracts	11 years	87.6			(35.4)		52.2		87.7			(21.6)		66.1
Channel sharing arrangements	35 years	12.6			(1.4)		11.2		12.6			(1.1)		11.5
Other	12 years	4.1			(1.1)		3.0		8.5			(3.3)		5.2
Total		$	129.7		$	(45.9)	$	83.8	$	134.2		$	(32.3)	$	101.9

For the year ended December 31, 2022, the Company recorded impairment charges to definite lived intangible assets of $1.5 million, which are reflected in Other operating loss in our Consolidated Statements of Operations. The impairment charges related to the HC2 Network Program License Agreement ("PLA") due to a decline in performance.

Amortization expense for definite lived intangible assets was $16.6 million and $12.6 million for the years ended December 31, 2022 and 2021, respectively, and was included in Depreciation and amortization in our Consolidated Statements of Operations.

Amortization

Future estimated annual amortization expense for intangible assets as of December 31, 2022 is as follows (in millions):


	Estimated Amortization
2023	$	11.1
2024	7.4
2025	7.3
2026	6.9
2027	4.7
Thereafter	46.4
Total	$	83.8