Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets

Goodwill and Intangible Assets

(9) Goodwill and Intangible Assets

Intangible assets, net consist of the following:

	June 30, 2020
	Gross carrying value		Accumulated amortization		Accumulated impairment charges		Translation and other adjustments		Net
	(In thousands)
Merchant contract portfolios and customer relationships	$	293,581	$	(171,537)	$	(5,686)	$	(35,162)	$	81,196
Marketing alliance agreements		186,081		(63,688)		(7,557)		(26,205)		88,631
Trademarks, definite-lived		21,628		(10,110)		(901)		(3,606)		7,011
Internally developed and acquired software		86,982		(31,972)		(10,190)		(3,358)		41,462
Non-compete agreements		6,462		(6,247)		-		-		215
Total	$	594,734	$	(283,554)	$	(24,334)	$	(68,331)	$	218,515
	December 31, 2019
	Gross carrying value		Accumulated amortization		Accumulated impairment charges		Translation and other adjustments		Net
	(In thousands)
Merchant contract portfolios and customer relationships	$	296,033	$	(163,358)	$	(7,089)	$	(26,347)	$	99,239
Marketing alliance agreements		191,879		(59,545)		(11,920)		(17,468)		102,946
Trademarks, definite-lived		29,493		(13,129)		(2,631)		(4,600)		9,133
Internally developed and acquired software		84,060		(26,042)		(10,190)		(2,110)		45,718
Non-compete agreements		6,462		(5,938)		-		-		524
Trademarks, indefinite-lived		18,499		-		(18,499)		-		-
Total	$	626,426	$	(268,012)	$	(50,329)	$	(50,525)	$	257,560

As of June 30, 2020, the gross carrying value of merchant contract portfolios and customer relationships, marketing alliance agreements, and definite and indefinite-lived trademarks were reduced by $2.4 million, $5.8 million, $7.9 million, and $18.5 million, respectively, with an offset to accumulated amortization, accumulated impairment charges, and translation and other adjustments, for the write off of fully impaired intangible assets.

Amortization expense related to intangible assets was $10.7 million and $11.6 million for the three months ended June 30, 2020 and 2019, respectively. Amortization expense related to intangible assets was $22.0 million and $24.1 million for the six months ended June 30, 2020 and 2019, respectively.

Estimated amortization expense to be recognized during each of the five years subsequent to June 30, 2020:

	(In thousands)
Years ending:
2020 (remainder of the year)	$	22,597
2021		38,811
2022		32,444
2023		27,294
2024		17,177
2025 and thereafter		80,192
Total	$	218,515

For the quarter ended June 30, 2020, the Company recognized an impairment charge of $0.8 million related to the retirement of certain trademarks driven by an internal reorganization.

The following represents intangible assets, net by segment:

	June 30,		December 31,
	2020		2019
	(In thousands)
Intangible assets, net:
Americas
Merchant contract portfolios and customer relationships	$	60,337	$	74,791
Marketing alliance agreements		61,190		72,272
Trademarks, definite-lived		1,799		2,994
Internally developed and acquired software		26,038		28,697
Non-compete agreements		190		489
Total		149,554		179,243
Europe
Merchant contract portfolios and customer relationships		20,859		24,448
Marketing alliance agreements		27,441		30,674
Trademarks, definite-lived		5,212		6,139
Internally developed and acquired software		15,424		17,021
Non-compete agreements		25		35
Total		68,961		78,317
Total intangible assets, net	$	218,515	$	257,560

Goodwill activity for the six months ended June 30, 2020, in total and by reportable segment, was as follows:

	Reportable Segment
	Americas		Europe		Total
	(In thousands)
Goodwill, gross, as of December 31, 2019	$	268,049	$	135,080	$	403,129
Accumulated impairment losses		—		(24,291)		(24,291)
Goodwill, net, as of December 31, 2019		268,049		110,789		378,838
Business combinations		61		—		61
Foreign currency translation adjustment		(8,638)		(3,319)		(11,957)
Goodwill, net, as of June 30, 2020	$	259,472	$	107,470	$	366,942

During the quarter ended June 30, 2020, the Company recorded a measurement period adjustment related to Delego acquisition which increased the goodwill by less than $0.1 million. Refer to Note 6, “Acquisitions,” for further discussion.