NEWMARKET CORP
For the period ended Mar 31, 2024. Filed Apr 25, 2024.
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Mar 31, 2024 · Filed Apr 25, 2024
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Intangibles (Net of Amortization) and Goodwill
- Intangibles (Net of Amortization) and Goodwill
The net carrying amount of intangibles and goodwill was $769 million at March 31, 2024 and $125 million at December 31, 2023. The gross carrying amount and accumulated amortization of each type of intangible asset and goodwill are presented in the table below.
| March 31, 2024 · December 31, 2023 | |||||
|---|---|---|---|---|---|
| (in thousands) · GrossCarryingAmount · AccumulatedAmortization · GrossCarryingAmount · AccumulatedAmortization | |||||
| Amortizing intangible assets | |||||
| Formulas and technology | $60,000 | $1,595 | $6,200 | $6,200 | |
| Contract | 0 | 0 | 2,000 | 2,000 | |
| Customer base | 277,440 | 7,891 | 5,440 | 4,539 | |
| Trademarks and trade names | 30,000 | 425 | 0 | 0 | |
| Water rights | 29,392 | 0 | |||
| Goodwill | 381,997 | 123,741 | |||
| $778,829 | $9,911 | $137,381 | $12,739 | ||
Of the total intangibles and goodwill, $125 million is attributable to the petroleum additives segment and $644 million is attributable to the specialty materials segment. The change in the gross carrying amount between December 31, 2023 and March 31, 2024 is due to the identifiable intangible assets and goodwill from the acquisition of AMPAC, as well as the write-off of fully amortized identifiable intangible assets and the foreign currency fluctuation on goodwill in the petroleum additives segment. See Note 2 for further information on the intangibles and goodwill obtained with the AMPAC acquisition. There isno accumulated goodwill impairment.
Amortization expense was (in thousands):
| Three months ended March 31, 2024 | $5,372 |
|---|---|
| Three months ended March 31, 2023 | 356 |
Estimated amortization expense for the remainder of 2024, as well as estimated annual amortization expense related to our intangible assets for the next five years, is expected to be (in thousands):
| 2024 | $18,925 |
| 2025 | 25,233 |
| 2026 | 25,233 |
| 2027 | 25,233 |
| 2028 | 25,184 |
| 2029 | 25,043 |
We amortize the formulas and technology over 8 years, the customer base over 17.5 to 20 years, and the trademarks and trade names over 15 years.
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