TIPTREE INC
For the period ended Mar 31, 2024. Filed May 1, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed May 1, 2024
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(8) Goodwill and Intangible Assets, net
The following table presents identifiable finite and indefinite-lived intangible assets, accumulated amortization, and goodwill by operating segment and/or reporting unit, as appropriate:
| As of March 31, 2024 | As of December 31, 2023 | |||||
|---|---|---|---|---|---|---|
| Finite-Lived Intangible Assets: | Insurance | Other | Total | Insurance | Other | Total |
| Customer relationships | $162,680 | $— | $162,680 | $162,844 | $— | $162,844 |
| Accumulated amortization | (78,051) | — | (78,051) | (74,776) | — | (74,776) |
| Trade names | 16,215 | 800 | 17,015 | 16,227 | 800 | 17,027 |
| Accumulated amortization | (8,812) | (700) | (9,512) | (8,452) | (680) | (9,132) |
| Software licensing | 17,304 | 640 | 17,944 | 17,372 | 640 | 18,012 |
| Accumulated amortization | (10,131) | (640) | (10,771) | (9,891) | (640) | (10,531) |
| Insurance policies and contracts acquired | 36,500 | — | 36,500 | 36,500 | — | 36,500 |
| Accumulated amortization | (36,500) | — | (36,500) | (36,500) | — | (36,500) |
| Other | 1,085 | — | 1,085 | 1,088 | — | 1,088 |
| Accumulated amortization | (611) | — | (611) | (536) | — | (536) |
| Total finite-lived intangible assets | 99,679 | 100 | 99,779 | 103,876 | 120 | 103,996 |
| Indefinite-Lived Intangible Assets: (1) | ||||||
| Insurance licensing agreements | 13,761 | — | 13,761 | 13,761 | — | 13,761 |
| Other | — | 1,000 | 1,000 | — | 1,000 | 1,000 |
| Total indefinite-lived intangible assets | 13,761 | 1,000 | 14,761 | 13,761 | 1,000 | 14,761 |
| Total intangible assets, net | $113,440 | $1,100 | $114,540 | $117,637 | $1,120 | $118,757 |
| Goodwill | 204,220 | 1,708 | 205,928 | 204,447 | 1,708 | 206,155 |
| Total goodwill and intangible assets, net | $317,660 | $2,808 | $320,468 | $322,084 | $2,828 | $324,912 |
(1)Impairment tests are performed at least annually on indefinite-lived intangible assets.
Goodwill
The following table presents the activity in goodwill, by operating segment and/or reporting unit, as appropriate, and includes the adjustments made to the balance of goodwill to reflect the effect of the final valuation adjustments made for acquisitions, as well as the reduction to any goodwill attributable to impairment related charges:
| Insurance | Other | Total | |
|---|---|---|---|
| Balance at December 31, 2022 | $184,900 | $1,708 | $186,608 |
| Goodwill acquired (1) | 18,359 | — | 18,359 |
| Foreign currency translation and other | 1,188 | — | 1,188 |
| Balance at December 31, 2023 | $204,447 | $1,708 | $206,155 |
| Foreign currency translation and other | (227) | — | (227) |
| Balance at March 31, 2024 | $204,220 | $1,708 | $205,928 |
(1)See Note (3) Acquisitions for more information.
The Company conducts annual impairment tests of its goodwill as of October 1. For the three months ended March 31, 2024 and 2023, no impairments were recorded on the Company’s goodwill. There was no accumulated impairment recorded in the goodwill balance as of March 31, 2024.
Intangible Assets, net
The following table presents the activity, by operating segment and/or reporting unit, as appropriate, in finite and indefinite-lived other intangible assets and includes the adjustments made to the balance to reflect the effect of any final valuation adjustments made for acquisitions, as well as any reduction attributable to impairment-related charges:
| Insurance | Other | Total | |
|---|---|---|---|
| Balance at December 31, 2022 | $115,087 | $1,928 | $117,015 |
| Intangible assets acquired (1) | 18,152 | — | 18,152 |
| Amortization expense | (16,921) | (80) | (17,001) |
| Foreign currency translation and other | 1,319 | — | 1,319 |
| Impairment | — | (728) | (728) |
| Balance at December 31, 2023 | $117,637 | $1,120 | $118,757 |
| Amortization expense | (3,971) | (20) | (3,991) |
| Foreign currency translation and other | (226) | — | (226) |
| Balance at March 31, 2024 | $113,440 | $1,100 | $114,540 |
(1)See Note (3) Acquisitions for more information.
The following table presents the amortization expense on finite-lived intangible assets for the following periods:
| Three Months EndedMarch 31, | ||
|---|---|---|
| 2024 | 2023 | |
| Amortization expense on intangible assets | $3,991 | $3,926 |
For the three months ended March 31, 2024 and 2023, no impairments were recorded on the Company’s intangible assets. The Company recorded $728 of accumulated impairment on intangible assets as of March 31, 2024.
The following table presents the amortization expense on finite-lived intangible assets for the next five years and thereafter by operating segment and/or reporting unit, as appropriate:
| As of March 31, 2024 | |||
|---|---|---|---|
| Insurance (1) · Other · Total | |||
| Remainder of 2024 | $11,514 | $60 | $11,574 |
| 2025 | 13,240 | 40 | 13,280 |
| 2026 | 10,894 | — | 10,894 |
| 2027 | 9,543 | — | 9,543 |
| 2028 | 8,341 | — | 8,341 |
| 2029 and thereafter | 46,101 | — | 46,101 |
| Total | $99,633 | $100 | $99,733 |
(1)Does not include foreign currency translation adjustment of $46 as of March 31, 2024.
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