GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The changes in the carrying amount of goodwill by segment were as follows:


(dollars in millions)	Electronics		Industrial & Specialty			Total
Balance at December 31, 2022	$	1,304.0	$	1,108.8	(1)	$	2,412.8
Transfer of Films business (2)	7.9		(7.9)			—
Goodwill impairment	—		(80.0)			(80.0)
Foreign currency translation and other	(43.2)		(8.1)			(51.3)
Balance at September 30, 2023	$	1,268.7	$	1,012.8		$	2,281.5

(1) Includes accumulated impairment losses of $46.6 million.

(2) Goodwill was reallocated using a relative fair value approach and assessed for impairment both before and after the allocation. See Note 1, Background and Basis of Presentation, to the unaudited Condensed Consolidated Financial Statements for further information.

Goodwill is tested for impairment at the reporting unit level in the fourth quarter of each year or when events or changes in circumstances indicate that goodwill might be impaired. During the third quarter of 2023, given the lower-than-expected results of the Graphics Solutions reporting unit, the Company determined that it was more likely than not that the fair value of this reporting unit was less than its carrying value. As a result, the Company conducted an interim goodwill impairment test using the same quantitative methodologies used for its 2022 annual goodwill impairment test (as described in Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements to the 2022 Annual Report). This quantitative test confirmed that goodwill was impaired and the Company recorded an $80.0 million impairment charge in the Condensed Consolidated Statement of Operations to reduce the carrying value of this reporting unit to its estimated fair value. This impairment charge was primarily driven by the reduction of the expected long-term cash flows for the business due to profit margin pressures from raw material inflation across the packaging supply chain, the recent loss of a significant newspaper customer, and a higher WACC as compared to the assumptions used for the 2022 annual goodwill impairment test.

As of September 30, 2023, following the impairment, the goodwill assigned to the Graphics Solutions reporting unit was approximately $129 million. After recording the impairment, its carrying value was equal to its estimated fair value.

Intangible Assets

The major components of intangible assets were as follows:


	September 30, 2023						December 31, 2022
(dollars in millions)	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Customer relationships	$	952.2	$	(478.1)	$	474.1	$	967.5	$	(434.1)	$	533.4
Developed technology	398.8		(299.5)		99.3		408.9		(277.0)		131.9
Trade names	93.6		(28.5)		65.1		96.0		(23.8)		72.2
Reacquired distribution rights	187.0		(4.2)		182.8		—		—		—
Other	0.6		(0.3)		0.3		—		—		—
Indefinite-lived trade name	68.0		—		68.0		68.0		—		68.0
Total	$	1,700.2	$	(810.6)	$	889.6	$	1,540.4	$	(734.9)	$	805.5

For the three months ended September 30, 2023 and 2022, the Company recorded amortization expense on intangible assets of $32.7 million and $29.2 million, respectively. For the nine months ended September 30, 2023 and 2022, the Company recorded amortization expense on intangible assets of $93.3 million and $90.5 million, respectively.