Goodwill

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

9. Goodwill

Effective January 1, 2023, the Company restructured into two Divisions, CRH Americas and CRH Europe. During the first quarter of 2023, the Company's reportable segments increased from three to the below four segments and existing goodwill was reallocated to each of the new reportable segments and associated reporting units based on management’s estimate of the relative fair value of each reporting unit. See Note 20 for further information. The results of this reallocation of goodwill have been recast below, by reportable segment, at December 31, 2022. As a result of this revision to reportable segments and associated reporting units, the Company performed an impairment assessment before and after the reallocation. Both before, and after, the reallocation, the Company concluded that the fair value of the reporting units were above their carrying value and therefore there was no indication of impairment.

The Company uses the present value of estimated future cash flows to establish the estimated fair value of the reporting units at the testing date. This approach includes many assumptions related to future growth rates, discount factors, and tax rates, among other considerations. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairment in future periods. Additionally, the Company uses the market approach to corroborate the estimated fair value.

The changes in the carrying amount of goodwill at December 31 were:

in $ millions	Americas Materials Solutions	Americas Building Solutions	Europe Materials Solutions	Europe Building Solutions	Total
Carrying value, December 31, 2021	4,292	2,576	2,075	508	9,451
Acquisitions	147	1,120	15	38	1,320
Foreign currency translation adjustment	(32)	(12)	(161)	(34)	(239)
Divestitures	–	(1,167)	(166)	–	(1,333)
Carrying value, December 31, 2022	4,407	2,517	1,763	512	9,199
Acquisitions	34	240	38	86	398
Foreign currency translation adjustment	8	(5)	57	29	89
Impairment charge for the year	(32)	–	(295)	–	(327)
Reclassified as held for sale	–	–	(201)	–	(201)
Carrying value, December 31, 2023	4,417	2,752	1,362	627	9,158

There were no charges for goodwill impairment in the year ended December 31, 2022. For the year ended December 31, 2023, the fair value of the Company’s Philippines reporting unit within Europe Materials Solutions, did not exceed its carrying value. As a result, a goodwill impairment loss of $295 million was recorded in Loss on impairments.

The total impairment loss of $327 million principally relates to the $295 million impairment of the Philippines cement business, driven by challenging cement market conditions which has had an impact on growth prospects. The assumption underlying the estimated future cash flows resulted in a present value (using a real pre-tax discount rate of 9.7%) of $1,022 million and a related goodwill impairment being recorded of $295 million. Further, a goodwill impairment loss of $32 million has been recorded across certain reporting units within the Company’s Americas Materials Solutions segment primarily relating to assets held for sale.

Accumulated goodwill impairment losses amount to $1,001 million and $691 million at December 31, 2023 and 2022, respectively and relates predominantly to Europe Materials Solutions.