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Goodwill and Intangible Assets
 6 Months Ended
Jun. 27, 2025
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets GOODWILL AND INTANGIBLE ASSETS
Goodwill
Goodwill represents the excess of the consideration transferred over the fair value of the tangible and identifiable intangible assets acquired, less the liabilities assumed in a business combination. Changes in the carrying amount of goodwill by segment during the six months ended June 27, 2025, were as follows:
(In millions)ProductsServicesTotal
Balance at December 27, 2024$191.8 $73.5 $265.3 
Impairment of Goodwill(77.6)(73.5)(151.1)
Balance at June 27, 2025$114.2 $— $114.2 
During the first quarter of 2025, the Company combined the HIS and Core Products reporting units following a reevaluation of its reporting structure. Impairment assessments were performed immediately before and after the change, and it was concluded that the fair values of these reporting units exceeded their carrying values on both an individual and combined basis. Following this reevaluation, the Company is organized into four reporting units: Core Products, Fluid Solutions, Fluid Delivery Systems, and Services. During the first quarter of 2025, the Company did not recognize any impairment charges or additions to goodwill.
During the second quarter of 2025, the Company experienced a sustained decline in the market price of its common stock. As a result, the Company’s market capitalization became much closer to, and at times fell below, the carrying value of its net assets. The decline in market capitalization, combined with other factors specific to each reporting unit, such as changes in market conditions and financial performance, was identified as a triggering event under ASC 350, Intangibles—Goodwill and Other, requiring the Company to perform an interim goodwill impairment test.
The Company performed a quantitative goodwill impairment test for each of its four reporting units by comparing the estimated fair value of each reporting unit to its respective carrying value. Based on the results of this assessment, goodwill impairments were identified in the Fluid Solutions and Services reporting units. As a result, the Company recorded a total goodwill impairment charge of $151.1 million during the second quarter of 2025, of which $77.6 million was attributable to the Products segment and $73.5 million was attributable to the Services segment. No impairments were identified in the Core Products or Fluid Delivery Systems reporting units.
For the quantitative goodwill impairment tests performed, the fair value estimates of the Company’s reporting units were derived from an income approach. Under the income approach, the Company estimated the fair value of the reporting unit based on the present value of estimated future cash flows, which the Company considers to be a Level 3 unobservable input in the fair value hierarchy. The Company prepared cash flow projections based on management's estimates of revenue growth rates and operating margins, taking into consideration historical performance and the current macroeconomic,
industry, and market conditions. The Company based the discount rate on the weighted-average cost of capital considering Company-specific characteristics and changes in the reporting unit's projected cash flows.
Following the impairment of goodwill recorded in the second quarter of 2025, there is no goodwill recorded in the Fluid Solutions reporting unit or in the Services reporting unit. The fair values of the Core Products reporting unit and the Fluid Delivery Systems reporting unit were each substantially in excess of their respective carrying values.
Prior to testing goodwill for impairment, the Company evaluated the recoverability of its long-lived assets under ASC 360, Property, Plant, and Equipment, and determined that no impairment of long-lived assets was required.
Intangible Assets
Intangible assets are generally recorded in connection with a business acquisition. The Company evaluates the useful lives of its intangible assets each reporting period to determine whether events and circumstances require revising the remaining period of amortization. In addition, the Company reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable and evaluates indefinite-lived intangible asset for impairment annually, or more frequently if indicators of potential impairment exist. Management considers such indicators as significant differences in product demand from the estimates, changes in the competitive and economic environment, technological advances, and changes in cost structure.
Details of intangible assets were as follows:
As of June 27, 2025As of December 27, 2024
(Dollars in millions)Useful Life
(In years)		Gross
Carrying
Amount		Accumulated
Amortization 		Carrying
Value		Gross
Carrying
Amount		Accumulated
Amortization		Carrying
Value
Customer relationships
6 - 10
$207.2 $(126.8)$80.4 $207.2 $(117.4)$89.8 
Recipes2073.2 (25.0)48.2 73.2 (23.2)50.0 
Intellectual property/know-how
7 - 15
48.9 (25.0)23.9 48.9 (22.8)26.1 
Tradename
4 - 6*
32.5 (23.2)9.3 32.5 (22.9)9.6 
Standard operating procedures208.6 (2.9)5.7 8.6 (2.7)5.9 
Developed technology54.6 (1.5)3.1 4.6 (1.1)3.5 
Total $375.0 $(204.4)$170.6 $375.0 $(190.1)$184.9 
*The Company concluded that the asset life of UCT tradename of $9.0 million is indefinite and is therefore not amortized but is reviewed for impairment at least annually and whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.
The Company amortizes its intangible assets on a straight-line or accelerated basis over the estimated economic life of the assets. Amortization expense was approximately $7.0 million and $14.3 million for the three and six months ended June 27, 2025, respectively. For the three and six months ended June 28, 2024, amortization expense was approximately $7.6 million and $15.3 million, respectively. Amortization expense related to recipes, standard operating procedures, developed technology and certain intellectual property/know-how is included in cost of revenues, while the remaining amortization expense is included in general and administrative expense. As of June 27, 2025, future estimated amortization expense is expected to be as follows:
(In millions)Amortization
Expense
2025 (remaining in year)$13.8 
202627.2 
202726.9 
202823.8 
202916.2 
Thereafter53.7 
Total$161.6