GOODWILL AND INTANGIBLES

9 Months Ended

Sep. 28, 2019

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. 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.

Changes in the carrying amount of goodwill, by reportable segment, from December 29, 2018 to September 28, 2019 are summarized as follows: 

	West		East		Cement		Total
Balance, December 29, 2018	$	580,567	$	406,805	$	204,656	$	1,192,028
Acquisitions (1)	1,167		3,621		—		4,788
Foreign currency translation adjustments	1,680		—		—		1,680
Balance, September 28, 2019	$	583,414	$	410,426	$	204,656	$	1,198,496

_____________________________________________________________________________________________

(1) Reflects goodwill from 2019 acquisitions and working capital adjustments from prior year acquisitions.

The Company’s intangible assets are primarily composed of goodwill, mineral lease agreements and reserve rights. 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. The following table shows intangible assets by type and in total:

	September 28, 2019							December 29, 2018
	Gross  Carrying  Amount		Accumulated  Amortization			Net  Carrying  Amount		Gross  Carrying  Amount		Accumulated  Amortization			Net  Carrying  Amount
Mineral leases	$	19,064	$	(6,124	)	$	12,940	$	19,064	$	(5,259	)	$	13,805
Reserve rights	6,234		(2,174		)	4,060		6,234		(1,940		)	4,294
Trade names	1,000		(933		)	67		1,000		(858		)	142
Other	7,814		(435		)	7,379		409		(190		)	219
Total intangible assets	$	34,112	$	(9,666	)	$	24,446	$	26,707	$	(8,247	)	$	18,460

Amortization expense totaled $0.6 million and $1.4 million for the three and nine months ended September 28, 2019, respectively, and $0.5 million and $1.1 million for the three and nine months September 29, 2018, respectively. The estimated amortization expense for the intangible assets for each of the five years subsequent to September 28, 2019 is as follows:

2019 (three months)	$	711
2020	2,552
2021	2,164
2022	2,168
2023	2,035
2024	1,940
Thereafter	12,876
Total	$	24,446

In September 2018, the Company sold a non-core business in the West segment, resulting in cash proceeds of $21.6 million, and a total gain on the disposition of the business of $12.1 million.

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. 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.

Changes in the carrying amount of goodwill, by reportable segment, from December 29, 2018 to September 28, 2019 are summarized as follows:

	West		East		Cement		Total
Balance, December 29, 2018	$	581,567	$	406,805	$	204,656	$	1,193,028
Acquisitions (1)	1,167		3,621		—		4,788
Foreign currency translation adjustments	1,680		—		—		1,680
Balance, September 28, 2019	$	584,414	$	410,426	$	204,656	$	1,199,496

_______________________________________________________________________

(1) Reflects goodwill from 2019 acquisitions and working capital adjustments from prior year acquisitions.

The Company’s intangible assets are primarily composed of goodwill, mineral lease agreements and reserve rights. 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. The following table shows intangible assets by type and in total:

	September 28, 2019							December 29, 2018
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Mineral leases	$	19,064	$	(6,124	)	$	12,940	$	19,064	$	(5,259	)	$	13,805
Reserve rights	6,234		(2,174		)	4,060		6,234		(1,940		)	4,294
Trade names	1,000		(933		)	67		1,000		(858		)	142
Other	7,814		(435		)	7,379		409		(190		)	219
Total intangible assets	$	34,112	$	(9,666	)	$	24,446	$	26,707	$	(8,247	)	$	18,460

Amortization expense totaled $0.6 million and $1.4 million for the three and nine months ended September 28, 2019, respectively, and $0.5 million and $1.1 million for the three and nine months September 29, 2018, respectively. The estimated amortization expense for the intangible assets for each of the five years subsequent to September 28, 2019 is as follows:

2019 (three months)	$	711
2020	2,552
2021	2,164
2022	2,168
2023	2,035
2024	1,940
Thereafter	12,876
Total	$	24,446

In September 2018, the Company sold a non-core business in the West segment, resulting in cash proceeds of $21.6 million, and a total gain on the disposition of the business of $12.1 million.