Goodwill and Other Intangible Assets

9 Months Ended

Oct. 01, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Goodwill and other intangible assets included in the Condensed Consolidated Balance Sheets consisted of the following:

	October 1, 2022		January 1, 2022
Goodwill, net	$	306.0	$	297.3
Definite-lived intangible assets, net	130.4		147.6
Indefinite-lived intangible assets	15.5		26.5
Total goodwill and other intangible assets, net	$	451.9	$	471.5

Goodwill

The changes in the carrying amount of goodwill, by reporting segment, are as follows:

	Workplace Furnishings		Residential Building Products		Total
Balance as of January 1, 2022
Goodwill	$	162.3	$	213.8	$	376.1
Accumulated impairment losses	(78.6)		(0.1)		(78.8)
Net goodwill balance as of January 1, 2022	83.6		213.7		297.3
Goodwill acquired (disposed) / measurement period adjustments	(6.9)		8.6		1.7
Accumulated impairment losses disposed	6.9		—		6.9
Balance as of October 1, 2022
Goodwill	155.3		222.5		377.8
Accumulated impairment losses	(71.7)		(0.1)		(71.8)
Net goodwill balance as of October 1, 2022	$	83.6	$	222.3	$	306.0

Goodwill and accumulated impairment losses were disposed in conjunction with the sale of Lamex in third quarter of 2022. See "Note 3. Acquisitions and Divestitures" for additional information on transactions that resulted in changes in goodwill in 2022.

Definite-lived intangible assets

The table below summarizes amortizable definite-lived intangible assets, which are reflected in "Goodwill and Other Intangible Assets" in the Condensed Consolidated Balance Sheets:

	October 1, 2022						January 1, 2022
	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net
Software	$	202.1	$	119.8	$	82.3	$	196.8	$	102.1	$	94.7
Trademarks and trade names	14.3		5.6		8.7		14.3		4.6		9.7
Customer lists and other	80.2		40.8		39.4		109.6		66.4		43.3
Net definite-lived intangible assets	$	296.5	$	166.2	$	130.4	$	320.7	$	173.0	$	147.6

The decrease in the gross and accumulated amortization of definite-lived intangible asset balances during the current year is primarily related to the sale of Lamex and the disposal of related fully amortized assets.

Amortization expense is reflected in "Selling and administrative expenses" in the Condensed Consolidated Statements of Comprehensive Income and was as follows:

	Three Months Ended				Nine Months Ended
	October 1, 2022		October 2, 2021		October 1, 2022		October 2, 2021
Capitalized software	$	6.1	$	6.1	$	18.4	$	17.5
Other definite-lived intangibles	$	1.6	$	1.6	$	4.9	$	4.9

The occurrence of events such as acquisitions, dispositions, or impairments may impact future amortization expense. Based on the current amount of intangible assets subject to amortization, the estimated amortization expense for each of the following five years is as follows:

	2022		2023		2024		2025		2026
Amortization expense	$	30.9	$	26.9	$	22.6	$	19.5	$	16.6

Indefinite-lived intangible assets

The Corporation also owns certain intangible assets, which are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely. These indefinite-lived intangible assets are reflected in "Goodwill and Other Intangible Assets" in the Condensed Consolidated Balance Sheets:

	October 1, 2022		January 1, 2022
Trademarks and trade names	$	15.5	$	26.5

In the third quarter of 2022, the Corporation sold its Lamex business which resulted in the disposal of the related indefinite-lived trade name.

Impairment Analysis

The Corporation evaluates its goodwill and indefinite-lived intangible assets for impairment on an annual basis during the fourth quarter, or whenever indicators of impairment exist. The Corporation also evaluates long-lived assets (which include definite-lived intangible assets) for impairment if indicators exist.