Goodwill and Intangible Assets

9 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

6. 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. If events occur or circumstances change that would more likely than not reduce fair values of the reporting units below their carrying values, goodwill will be evaluated for impairment between annual tests. No triggering events indicating goodwill impairment occurred during the nine months ended June 30, 2020. Please refer to Note 7, "Goodwill and Intangible Assets" to the Company's consolidated financial statements included in the

2019 Annual Report on Form 10-K for further information on the goodwill impairment testing performed during fiscal year 2019.

The Company performs its annual goodwill impairment assessment on April 1st of each year. In accordance with ASC 350, Intangibles-Goodwill and Other, 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.

During the quarter ended June 30, 2020, the Company completed the annual goodwill impairment test for its six reporting units, including Automation Solutions, Contamination Control Solutions and Global Semiconductor Services within the Brooks Semiconductor Solutions Group segment, as well as Sample Repository Solutions, Life Sciences Products 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 the three reporting units within the Brooks Semiconductor Solutions Group segment and determined that it was more likely than not that their fair values were greater than their carrying values. As a result of the analysis, the Company did not perform the quantitative assessment for these reporting units, and therefore, did not recognize any impairment losses. The Company performed the quantitative goodwill impairment test for the three reporting units within the Brooks Life Sciences segment and determined that no adjustment to goodwill was necessary since the estimated fair values exceed their book values.

The changes in the Company’s goodwill by reportable segment at June 30, 2020 and September 30, 2019 are as follows (in thousands):

	Brooks
	Semiconductor
	Solutions		Brooks
	Group		Life Sciences		Other		Total
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
Acquisitions and adjustments		316		11,144		—		11,460
Gross goodwill, at June 30, 2020		637,107		451,899		26,014		1,115,020
Accumulated goodwill impairments		(588,944)		—		(26,014)		(614,958)
Goodwill, net of accumulated impairments, at June 30, 2020	$	48,163	$	451,899	$	—	$	500,062

During the nine months ended June 30, 2020, the Company recorded a goodwill increase of $11.5 million primarily related to the RURO acquisition and the impact of foreign currency translation adjustments.

The components of the Company’s identifiable intangible assets as of June 30, 2020 and September 30, 2019 are as follows (in thousands):

	June 30, 2020						September 30, 2019
			Accumulated		Net Book				Accumulated		Net Book
	Cost		Amortization		Value		Cost		Amortization		Value
Patents	$	8,251	$	5,013	$	3,238	$	5,302	$	4,628	$	674
Completed technology		88,736		46,504		42,232		88,288		38,778		49,510
Trademarks and trade names		25,604		8,425		17,179		25,340		5,807		19,533
Customer relationships		268,913		104,942		163,971		265,450		84,047		181,403
Other intangibles		236		233		3		231		183		48
	$	391,740	$	165,117	$	226,623	$	384,611	$	133,443	$	251,168

Amortization expense for intangible assets was $31.3 million and $26.2 million, respectively, during the nine months ended June 30, 2020 and 2019.

Estimated future amortization expense for the intangible assets for the remainder of fiscal year 2020, the subsequent four fiscal years and thereafter is as follows (in thousands):

Fiscal year ended September 30,
2020	$	10,454
2021		38,714
2022		35,459
2023		32,170
2024		27,211
Thereafter		82,615
	$	226,623