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Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

7. Goodwill and Intangible Assets

Goodwill represents the excess of net book value over the estimated fair value of net tangible and identifiable intangible assets of a reporting unit. Goodwill is tested for impairment annually or more often if impairment indicators are present at the reporting unit level. The Company elected April 1^st as its annual goodwill impairment assessment date. If the existence of events or circumstances indicates that it is more likely than not that fair values of the reporting units

are below their carrying values, the Company performs additional impairment tests during interim periods to evaluate goodwill for impairment.

In accordance with ASC 350, the Company initially assesses qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If the Company determines, based on this assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying value, it performs a quantitative goodwill impairment test by comparing the reporting unit’s fair value with its carrying value. An impairment loss is recognized for the amount by which the reporting unit’s carrying value exceeds its fair value, up to the total amount of goodwill allocated to the reporting unit. No impairment loss is recognized if the fair value of the reporting exceeds its carrying value.

The Company completed its annual goodwill impairment test as of April 1, 2019 for its five reporting units, including Automation Solutions, Contamination Control Solutions and Global Semiconductor Services within the Brooks Semiconductor Solutions Group segment, as well as Sample Management and GENEWIZ within the Brooks Life Sciences segment. Based on the test results, the Company determined that no adjustment to goodwill was necessary. The Company conducted a qualitative assessment for three reporting units within the Brooks Semiconductor Solutions Group segment and determined that it was more likely than not that their fair values were more than their carrying values. As a result of the analysis, the Company did not perform the quantitative assessment for these reporting units and did not recognize any impairment losses. The Company performed the quantitative goodwill impairment test for the two reporting units within the Brooks Life Sciences segment. The Company determined that no adjustment to goodwill was necessary for these two reporting units. The Sample Management reporting unit’s fair value significantly exceeded book value. The GENEWIZ reporting unit, which was recently acquired, had a fair value slightly above its book value.

The following table sets forth the changes in the carrying amount of goodwill by reportable segment since September 30, 2017 (in thousands):


	Brooks
	Semiconductor
	Solutions		Brooks
	Group		Life Sciences		Other		Total
Gross goodwill, at September 30, 2017	$	629,278	$	166,820	$	26,014	$	822,112
Accumulated goodwill impairments		(588,944)		—		(26,014)		(614,958)
Goodwill, net of accumulated impairments, at September 30, 2017		40,334		166,820		—		207,154
Acquisitions and adjustments		7,629		41,093		—		48,722
Gross goodwill, at September 30, 2018		636,907		207,913		26,014		870,834
Accumulated goodwill impairments		(588,944)		—		(26,014)		(614,958)
Goodwill, net of accumulated impairments, at September 30, 2018		47,963		207,913		—		255,876
Acquisitions and adjustments		(116)		232,842		—		232,726
Gross goodwill, at September 30, 2019		636,791		440,755		26,014		1,103,560
Accumulated goodwill impairments		(588,944)		—		(26,014)		(614,958)
Goodwill, net of accumulated impairments, at September 30, 2019	$	47,847	$	440,755	$	—	$	488,602

During fiscal year 2019, the Company recorded a goodwill increase of $232.7 million primarily related to the acquisition of GENEWIZ.

The components of the Company’s identifiable intangible assets as of September 30, 2019 and 2018 are as follows (in thousands):


	September 30, 2019						September 30, 2018
			Accumulated		Net Book				Accumulated		Net Book
	Cost		Amortization		Value		Cost		Amortization		Value
Patents	$	5,302	$	4,628	$	674	$	5,302	$	4,325	$	977
Completed technology		88,288		38,778		49,510		44,829		28,934		15,895
Trademarks and trade names		25,340		5,807		19,533		6,298		2,953		3,345
Customer relationships		265,451		84,048		181,403		142,489		62,750		79,739
Other intangibles		231		183		48		—		—		—
	$	384,612	$	133,444	$	251,168	$	198,918	$	98,962	$	99,956

Amortization expense for intangible assets was $35.2 million, $24.2 million and $17.1 million, respectively, for the fiscal years ended September 30, 2019, 2018 and 2017.

Estimated future amortization expense for the intangible assets as of September 30, 2019 is as follows (in thousands):


Fiscal year ended September 30,
2020	$	41,381
2021		37,494
2022		34,390
2023		31,267
2024		26,456
Thereafter		80,180
	$	251,168