Goodwill and Other Intangible Assets

12 Months Ended

Aug. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Note 7. Goodwill, Intangible Assets and Long-Lived Assets

Changes in the gross carrying value of goodwill and intangible assets result from changes in foreign currency exchange rates, business acquisitions, divestitures and impairment charges. The changes in the carrying amount of goodwill for the years ended August 31, 2022 and 2021 by operating segment are as follows (in thousands):


	IT&S		Other		Total
Balance as of August 31, 2020	$	263,537	$	17,617	$	281,154
Impairment charge	—		(5,656)		(5,656)
Impact of changes in foreign currency rates	1,550		545		2,095
Balance as of August 31, 2021	265,087		12,506		277,593
Impairment charge	—		(1,297)		(1,297)
Impact of changes in foreign currency rates	(18,347)		—		(18,347)
Balance as of August 31, 2022	$	246,740	$	11,209	$	257,949

The gross carrying value and accumulated amortization of the Company’s intangible assets are as follows (in thousands):


	Weighted Average Amortization Period (Year)	August 31, 2022						August 31, 2021
		Gross		Accumulated Amortization		Net Book Value		Gross		Accumulated Amortization		Net Book Value
Amortizable intangible assets:
Customer relationships	14	$	135,101	$	117,275	$	17,826	$	142,453	$	114,463	$	27,990
Patents	11	13,708		13,104		604		14,492		13,688		804
Trademarks and tradenames	12	3,132		2,329		803		3,307		2,391		916
Indefinite lived intangible assets:
Tradenames	N/A	22,274		—		22,274		24,835		—		24,835
		$	174,215	$	132,708	$	41,507	$	185,087	$	130,542	$	54,545

The Company estimates that amortization expense for future years is estimated to be: $5.2 million in fiscal 2023, $3.6 million in fiscal 2024, $3.0 million in fiscal 2025, $1.8 million in fiscal 2026, $1.7 million in fiscal 2027 and $4.0 million in aggregate thereafter. The future amortization expense amounts represent estimates and may be impacted by future acquisitions, divestitures or changes in foreign currency exchange rates, among other causes.

Fiscal 2022 Impairment Charges

The carryover effects from the COVID-19 pandemic coupled with current year labor, supply chain and inflation challenges had a more than anticipated effect on the Cortland Industrial business. Therefore, in conjunction with our annual goodwill impairment assessment, the Company recognized a $1.3 million goodwill impairment charge associated with the Cortland Industrial reporting unit (Other Segment) within "Impairment & divestiture charges (benefit)" in the Consolidated Statements of Earnings.

In addition, during fiscal 2022, the Company recorded "Impairment & divestiture charges" of $1.1 million on indefinite lived intangible assets; $0.8 million was related to a customer relationship intangible asset whereby the Company ceased operations in the country associated with said customers and $0.3 million was related to tradename intangible asset on a discontinued secondary brand.

Fiscal 2021 Impairment Charges

In the fourth quarter of fiscal 2021, the Cortland Industrial business lagged behind our IT&S segment with respect to recovery in demand from the COVID-19 pandemic. Further, though volumes did increase from previous quarters, it became clear that the business was not on track to realize the annual savings from the prior years' footprint optimization actions at the

pace initially projected. Therefore, in conjunction with our annual goodwill impairment assessment, the Company recognized a $5.7 million goodwill impairment charge associated with the Cortland Industrial reporting unit (Other Segment) within "Impairment & divestiture charges (benefit)" in the Consolidated Statements of Earnings.