Note 5 - Goodwill and Other Intangible Assets

12 Months Ended

Nov. 30, 2019

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

Note 5: Goodwill and Other Intangible Assets

Goodwill balances by reportable segment as of November 30, 2019 and December 1, 2018 consisted of the following:

	2019		2018
Americas Adhesives	$	322,875	$	339,800
EIMEA		151,626		155,552
Asia Pacific		21,357		21,428
Construction Adhesives		310,979		310,720
Engineering Adhesives		474,971		477,671
Total	$	1,281,808	$	1,305,171

Additional details related to goodwill for 2019 and 2018 are as follows.

	2019			2018
Balance at beginning of year	$	1,305,171		$	1,336,684
Ramapo acquisition		910			-
Dalton Holdings divestiture		(15,757	)		-
Adecol acquisition		-			(1,881	)
Royal Adhesives acquisition		-			1,730
Foreign currency translation effect		(8,516	)		(31,362	)
Balance at end of year	$	1,281,808		$	1,305,171

We evaluate our goodwill for impairment annually during the fourth quarter or earlier upon the occurrence of substantive unfavorable changes in economic conditions, industry trends, costs, cash flows, or ongoing declines in market capitalization. The quantitative impairment test requires judgment, including the identification of reporting units, the assignment of assets, liabilities and goodwill to reporting units, and the determination of fair value of each reporting unit. The impairment test requires the comparison of the fair value of each reporting unit with its carrying amount, including goodwill. In performing the impairment test, we determined the fair value of our reporting units by using DCF analyses. Determining fair value requires the Company to make judgments about appropriate discount rates, perpetual growth rates and the amount and timing of expected future cash flows. The cash flows employed in the DCF analysis for each reporting unit are based on the reporting unit's budget, long-term business plan, and recent operating performance. Discount rate assumptions are based on an assessment of the risk inherent in the future cash flows of the respective reporting unit and market conditions. Based on the analysis performed during the fourth quarter of 2019, there were no indications of impairment for any of our reporting units.

Balances of amortizable identifiable intangible assets, excluding goodwill and other non-amortizable intangible assets, are as follows:

Amortizable Intangible Assets	Purchased Technology and Patents			Customer Relationships			Tradename			All Other			Total
As of November 30, 2019
Original cost	$	109,967		$	913,968		$	62,537		$	27,453		$	1,113,925
Accumulated amortization		(43,351	)		(223,563	)		(24,819	)		(23,273	)		(315,006	)
Net identifiable intangibles	$	66,616		$	690,405		$	37,718		$	4,180		$	798,919
Weighted-average useful lives (in years)		13			17			14			10			17
As of December 1, 2018
Original cost	$	118,930		$	953,929		$	65,975		$	33,550		$	1,172,384
Accumulated amortization		(41,503	)		(175,318	)		(21,573	)		(26,332	)		(264,726	)
Net identifiable intangibles	$	77,427		$	778,611		$	44,402		$	7,218		$	907,658
Weighted-average useful lives (in years)		12			17			14			9			17

Amortization expense with respect to amortizable intangible assets was $74,091, $76,490 and $36,243 in 2019, 2018 and 2017, respectively.

Estimated aggregate amortization expense based on the current carrying value of amortizable intangible assets for the next five fiscal years are as follows:

Fiscal Year	2020		2021		2022		2023		2024		Thereafter
Amortization Expense	$	69,467	$	67,800	$	66,298	$	63,448	$	58,655	$	473,251

The above amortization expense forecast is an estimate. Actual amounts may change from such estimated amounts due to fluctuations in foreign currency exchange rates, additional intangible asset acquisitions, potential impairment, accelerated amortization or other events.

Non-amortizable intangible assets as of November 30, 2019 and December 1, 2018 were $480 and $493, respectively, and relate to trademarks and trade names. The change in non-amortizable assets in 2019 compared to 2018 was due to changes in foreign currency exchange rates.