ACQUISITIONS, GOODWILL AND INTANGIBLES

9 Months Ended

Sep. 26, 2020

Business Acquisition [Line Items]

ACQUISITIONS, GOODWILL AND INTANGIBLES

ACQUISITIONS, GOODWILL AND INTANGIBLES

The Company has completed numerous acquisitions since its formation, which have been financed through a combination of debt and equity funding and available cash. The operations of each acquisition have been included in the Company’s consolidated results of operations since the respective closing dates of the acquisitions. The Company measures all assets acquired and liabilities assumed at their acquisition-date fair value. Goodwill acquired during a business combination has an indefinite life and is not amortized. The following table summarizes the Company’s acquisitions by region and period:

	Nine months ended	Year ended
	September 26, 2020	December 28, 2019
West	2	2
East	1	—

The purchase price allocation, primarily the valuation of property, plant and equipment for the acquisitions completed during the nine months ended September 26, 2020, as well as the acquisitions completed during 2019 that occurred after September 28, 2019, have not yet been finalized due to the recent timing of the acquisitions, status of the valuation of property, plant and equipment and finalization of related tax returns. The following table summarizes aggregated information regarding the fair values of the assets acquired and liabilities assumed as of the respective acquisition dates:

	Nine months ended		Year ended
	September 26, 2020		December 28, 2019
Financial assets	$	8,866	$	—
Inventories	2,328		52
Property, plant and equipment	17,069		3,542
Other assets	758		—
Financial liabilities	(3,980)		(36)
Other long-term liabilities	(6,473)		—
Net assets acquired	18,568		3,558
Goodwill	105,280		1,834
Purchase price	123,848		5,392
Other	(652)		—
Net cash paid for acquisitions	$	123,196	$	5,392

Changes in the carrying amount of goodwill, by reportable segment, from December 28, 2019 to September 26, 2020 are summarized as follows: 

	West		East		Cement		Total
Balance—December 28, 2019	$	584,617	$	410,426	$	204,656	$	1,199,699
Acquisitions (1)	105,298		—		—		105,298
Foreign currency translation adjustments	(1,911)		—		—		(1,911)
Balance—September 26, 2020	$	688,004	$	410,426	$	204,656	$	1,303,086

_______________________________________________________________________

(1) Reflects goodwill from acquisitions completed during the nine months ended September 26, 2020 and working capital adjustments from prior year acquisitions.

The Company’s intangible assets subject to amortization are primarily composed of operating permits, mineral lease agreements and reserve rights. Operating permits relate to permitting and zoning rights acquired outside of a business combination. The assets related to mineral lease agreements reflect the submarket royalty rates paid under agreements, primarily for extracting aggregates. The values were determined as of the respective acquisition dates by a comparison of market-royalty rates. The reserve rights relate to aggregate reserves to which the Company has the rights of ownership, but does not own the reserves. The intangible assets are amortized on a straight-line basis over the lives of the leases or permits. The following table shows intangible assets by type and in total:

	September 26, 2020						December 28, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Operating permits	$	23,345	$	(1,162)	$	22,183	$	6,609	$	(290)	$	6,319
Mineral leases	19,225		(7,286)		11,939		19,064		(6,408)		12,656
Reserve rights	6,234		(2,444)		3,790		6,234		(2,248)		3,986
Trade names	1,000		(1,000)		—		1,000		(958)		42
Other	586		(575)		11		957		(462)		495
Total intangible assets	$	50,390	$	(12,467)	$	37,923	$	33,864	$	(10,366)	$	23,498

Amortization expense totaled $0.7 million and $2.3 million for the three and nine months ended September 26, 2020, respectively, and $0.6 million and $1.4 million for the three and nine months ended September 28, 2019, respectively. The estimated amortization expense for the intangible assets for each of the five years subsequent to September 26, 2020 is as follows:

2020 (three months)	$	686
2021	2,719
2022	2,723
2023	2,590
2024	2,495
2025	2,450
Thereafter	24,260
Total	$	37,923

Summit Materials, LLC

Business Acquisition [Line Items]

GOODWILL AND INTANGIBLES

GOODWILL AND INTANGIBLES

The Company has completed numerous acquisitions since its formation, which have been financed through a combination of debt and equity funding and available cash. The operations of each acquisition have been included in the Company’s consolidated results of operations since the respective closing dates of the acquisitions. The Company measures all assets acquired and liabilities assumed at their acquisition-date fair value. Goodwill acquired during a business combination has an indefinite life and is not amortized. The following table summarizes the Company’s acquisitions by region and period:

	Nine months ended	Year ended
	September 26, 2020	December 28, 2019
West	2	2
East	1	—

The purchase price allocation, primarily the valuation of property, plant and equipment for the acquisitions completed during the nine months ended September 26, 2020, as well as the acquisitions completed during 2019 that occurred after September 28, 2019, have not yet been finalized due to the recent timing of the acquisitions, status of the valuation of property, plant and equipment and finalization of related tax returns. The following table summarizes aggregated information regarding the fair values of the assets acquired and liabilities assumed as of the respective acquisition dates:

	Nine months ended		Year ended
	September 26, 2020		December 28, 2019
Financial assets	$	8,866	$	—
Inventories	2,328		52
Property, plant and equipment	17,069		3,542
Other assets	758		—
Financial liabilities	(3,980)		(36)
Other long-term liabilities	(6,473)		—
Net assets acquired	18,568		3,558
Goodwill	105,280		1,834
Purchase price	123,848		5,392
Other	(652)		—
Net cash paid for acquisitions	$	123,196	$	5,392

Changes in the carrying amount of goodwill, by reportable segment, from December 28, 2019 to September 26, 2020 are summarized as follows:

	West		East		Cement		Total
Balance—December 28, 2019	$	585,617	$	410,426	$	204,656	$	1,200,699
Acquisitions (1)	105,298		—		—		105,298
Foreign currency translation adjustments	(1,911)		—		—		(1,911)
Balance—September 26, 2020	$	689,004	$	410,426	$	204,656	$	1,304,086

_______________________________________________________________________

(1) Reflects goodwill from acquisitions completed during the nine months ended September 26, 2020 and working capital adjustments from prior year acquisitions.

The Company’s intangible assets subject to amortization are primarily composed of operating permits, mineral lease agreements and reserve rights. Operating permits relate to permitting and zoning rights acquired outside of a business combination. The assets related to mineral lease agreements reflect the submarket royalty rates paid under agreements, primarily for extracting aggregates. The values were determined as of the respective acquisition dates by a comparison of market-royalty rates. The reserve rights relate to aggregate reserves to which the Company has the rights of ownership, but does not own the reserves. The intangible assets are amortized on a straight-line basis over the lives of the leases or permits. The following table shows intangible assets by type and in total:

	September 26, 2020						December 28, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Operating permits	$	23,345	$	(1,162)	$	22,183	$	6,609	$	(290)	$	6,319
Mineral leases	19,225		(7,286)		11,939		19,064		(6,408)		12,656
Reserve rights	6,234		(2,444)		3,790		6,234		(2,248)		3,986
Trade names	1,000		(1,000)		—		1,000		(958)		42
Other	586		(575)		11		957		(462)		495
Total intangible assets	$	50,390	$	(12,467)	$	37,923	$	33,864	$	(10,366)	$	23,498

Amortization expense totaled $0.7 million and $2.3 million for the three and nine months ended September 26, 2020, respectively, and $0.6 million and $1.4 million for the three and nine months ended September 28, 2019, respectively. The estimated amortization expense for the intangible assets for each of the five years subsequent to September 26, 2020 is as follows:

2020 (three months)	$	686
2021	2,719
2022	2,723
2023	2,590
2024	2,495
2025	2,450
Thereafter	24,260
Total	$	37,923