Goodwill and Other Intangible Assets

3 Months Ended

Mar. 29, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

A summary of the changes in goodwill by segment for the three months ended March 29, 2020 is as follows:


	Consumer Packaging		Display and Packaging		Paper and Industrial Converted Products		Protective Solutions		Total
Goodwill at December 31, 2019	$	691,243	$	203,414	$	303,041	$	231,648	$	1,429,346
2020 Acquisitions	—		—		1,050		—		1,050



Foreign currency translation	(11,419)		—		(7,815)		(800)		(20,034)
Measurement period adjustments	1,077		—		616		—		1,693
Goodwill at March 29, 2020	$	680,901	$	203,414	$	296,892	$	230,848	$	1,412,055

The Company recorded goodwill totaling $1,050 upon completion of the acquisition of a small tube and core operation in Jacksonville, Florida, from Design Containers, Inc. Measurement period adjustments were made in the first quarter of 2020 to the fair values of the assets acquired and the liabilities assumed in the 2019 acquisitions of Corenso and TEQ resulting in increases in goodwill of $616 and $1,077, respectively. See Note 3 for additional information.

The Company assesses goodwill for impairment annually during the third quarter, or from time to time when warranted by the facts and circumstances surrounding individual reporting units or the Company as a whole. The Company completed its most recent annual goodwill impairment testing during the third quarter of 2019. As part of this testing, the Company analyzed certain qualitative and quantitative factors in determining goodwill impairment. The Company's assessments reflected a number of significant management assumptions and estimates including the Company's forecast of sales, profit margins, and discount rates. Changes in these assumptions could materially impact the Company's conclusions. Based on its assessments, the Company concluded that there was no impairment of goodwill for any of its reporting units.

Although no reporting units failed the assessments noted above, in management’s opinion, the goodwill of the Display and Packaging reporting unit is at risk of impairment in the near term if there is a negative change in the long-term outlook for the business or in other factors such as the discount rate. A large portion of projected sales in this reporting unit is concentrated in several major customers, the loss of any of which could impact the Company's conclusion regarding the likelihood of goodwill impairment for the unit. Total goodwill associated with this reporting unit was $203,414 at March 29, 2020. In the latest annual impairment test, the estimated fair value of the Display and Packaging reporting unit was determined to exceed its carrying value by approximately 35.0%. In this analysis, projected future cash flows for Display and Packaging were discounted at 8.9%. Based on the discounted cash flow model and holding other valuation assumptions constant, Display and Packaging projected operating profits across all future periods would have to be reduced approximately 27.0%, or the discount rate increased to 12.5%, in order for the estimated fair value to fall below the reporting unit’s carrying value.

During the time subsequent to the annual evaluation, and at March 29, 2020, the Company considered whether any events and/or changes in circumstances, including the impact of the COVID-19 pandemic, had resulted in the likelihood that the goodwill of any of its reporting units may have been impaired. It is management's opinion that no such events have occurred.

Other Intangible Assets

A summary of other intangible assets as of March 29, 2020 and December 31, 2019 is as follows:


	March 29, 2020		December 31, 2019
Other Intangible Assets, gross:
Patents	$	26,072	$	26,096
Customer lists	627,456		632,036
Trade names	32,029		32,427
Proprietary technology	24,965		24,525
Other	2,273		2,297
Other Intangible Assets, gross	$	712,795	$	717,381

Accumulated Amortization:
Patents	$	(12,233)	$	(11,669)
Customer lists	(296,881)		(287,831)
Trade names	(10,698)		(9,985)
Proprietary technology	(18,551)		(17,910)
Other	(1,708)		(1,694)
Total Accumulated Amortization	$	(340,071)	$	(329,089)
Other Intangible Assets, net	$	372,724	$	388,292

In the first quarter of 2020, the Company paid $500 to purchase proprietary technology related to machinery and equipment purchased from a third-party that the Company plans to service internally going forward. This intangible will be amortized over its expected useful life of twelve years.

Other Intangible Assets are amortized on a straight-line basis over their respective useful lives, which generally range from three to forty years. The Company has no intangible assets with indefinite lives.

Aggregate amortization expense was $13,271 and $12,792 for the three months ended March 29, 2020 and March 31, 2019, respectively. Amortization expense on other intangible assets is expected to total approximately $52,100 in 2020, $50,400 in 2021, $47,900 in 2022, $43,000 in 2023 and $35,300 in 2024.