Vulcan Materials CO

NOTE 18: GOODWILL AND INTANGIBLE ASSETS

Acquired identifiable intangible assets are classified into three categories: (1) goodwill, (2) intangible assets with finite lives subject to amortization and (3) intangible assets with indefinite lives. Goodwill and intangible assets with indefinite lives are not amortized; rather, they are reviewed for impairment at least annually.

Goodwill

Goodwill is recognized when the consideration paid for a business exceeds the fair value of the tangible and identifiable intangible assets acquired. Goodwill is allocated to reporting units for purposes of testing goodwill for impairment. We test goodwill for impairment on an annual basis or more frequently if events or circumstances change in a manner that would more likely than not reduce the fair value of a reporting unit below its carrying value. A decrease in the estimated fair value of one or more of our reporting units could result in the recognition of a material, noncash write-down of goodwill.

There were no charges for goodwill impairment in the years ended December 31, 2025 or December 31, 2023. During the third quarter of 2024, we determined that a triggering event occurred with respect to a reporting unit that includes concrete operations acquired in 2021. Based on an interim goodwill impairment test, we determined that the estimated fair value of this reporting unit was less than its carrying value. As a result, we recorded an $86.6 million noncash impairment charge. Accumulated goodwill impairment losses amount to $390.2 million ($252.7 million in our former Cement segment and $137.5 million in our Concrete segment).

We have three reportable segments organized around our principal product lines: Aggregates, Asphalt and Concrete. Changes in the carrying amount of goodwill by reportable segment for the three years ended December 31 are shown below:

1. See Note 19 for acquisitions and divestitures.

Intangible Assets

Intangible assets primarily consist of contractual rights in place (primarily permitting and zoning rights) and quarry development. Intangible assets acquired in business combinations are stated at their fair value determined as of the date of acquisition. Intangible assets acquired individually or otherwise obtained outside a business combination consist primarily of permitting, permitting compliance and zoning rights and are stated at their historical cost less accumulated amortization. Costs incurred to renew or extend the life of existing intangible assets are capitalized. These capitalized renewal/extension costs were immaterial for the years presented.

See Note 19 for the details of the intangible assets acquired in business acquisitions. Amortization of finite-lived intangible assets is computed based on the estimated life of the intangible assets. Contractual rights in place associated with aggregates reserves are amortized using the unit-of-sales method based on estimated recoverable units. Other intangible assets are amortized principally by the straight-line method. Intangible assets are reviewed for impairment when events or circumstances indicate that the carrying amount may not be recoverable. There wereno material charges for impairment of intangible assets in 2025, 2024 and 2023.

The gross carrying amount and accumulated amortization by major intangible asset class for the years ended December 31 (excluding assets classified as held for sale as detailed in Note 19) are summarized below:

1. Includes quarry development, noncompetition agreements, patents, customer relationships, trade names and trademarks.

2. Capitalized quarry development costs of $168.3 million at December 31, 2024 were reclassified from Other noncurrent assets to Other intangible assets, net in our Consolidated Balance Sheet to conform to our current presentation.

Estimated amortization expense for the five years subsequent to December 31, 2025 is as follows: