CECO ENVIRONMENTAL CORP Goodwill & Intangibles Disclosure
(in thousands) |
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Total |
|
|||
Balance of goodwill at December 31, 2023 |
|
$ |
142,229 |
|
|
$ |
69,097 |
|
|
$ |
211,326 |
|
Acquisitions |
|
|
110 |
|
|
|
59,005 |
|
|
|
59,115 |
|
Foreign currency translation |
|
|
(596 |
) |
|
|
(98 |
) |
|
|
(694 |
) |
Balance of goodwill at December 31, 2024 |
|
|
141,743 |
|
|
|
128,004 |
|
|
|
269,747 |
|
Acquisitions |
|
|
25,563 |
|
|
|
16,206 |
|
|
|
41,769 |
|
Divestiture |
|
|
— |
|
|
|
(26,838 |
) |
|
|
(26,838 |
) |
Foreign currency translation |
|
|
1,270 |
|
|
|
2,215 |
|
|
|
3,485 |
|
Balance of goodwill at December 31, 2025 |
|
$ |
168,576 |
|
|
$ |
119,587 |
|
|
$ |
288,163 |
|
As of December 31, 2025 and 2024, the Company has an aggregate amount of goodwill acquired of $372.2 million and $330.4 million, respectively, and an aggregate amount of impairment losses of $60.7 million which was recognized in 2017.
The Company’s indefinite lived intangible assets as of December 31, 2025 and 2024 consisted of the following:
|
|
Tradenames |
|
|||||
(in thousands) |
|
2025 |
|
|
2024 |
|
||
Balance beginning of year |
|
$ |
9,466 |
|
|
$ |
9,570 |
|
Foreign currency adjustments |
|
|
239 |
|
|
|
(104 |
) |
Balance end of year |
|
$ |
9,705 |
|
|
$ |
9,466 |
|
The Company completes an impairment assessment of its goodwill and indefinite life intangible assets at the reporting unit level annually, or upon the occurrence of a triggering event or a change in circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The annual assessment was performed in the fourth quarters of 2025, 2024 and 2023. The assessments did not result in impairment in 2025, 2024 or 2023.
The Company’s finite lived intangible assets consisted of the following:
|
|
December 31, |
|
|||||||||||||
|
|
2025 |
|
|
2024 |
|
||||||||||
(in thousands) |
|
Cost |
|
|
Accumulated |
|
|
Cost |
|
|
Accumulated |
|
||||
Technology |
|
$ |
22,314 |
|
|
$ |
15,155 |
|
|
$ |
20,614 |
|
|
$ |
14,769 |
|
Customer lists |
|
|
140,337 |
|
|
|
62,163 |
|
|
|
127,354 |
|
|
|
70,045 |
|
Tradenames |
|
|
17,660 |
|
|
|
6,084 |
|
|
|
18,530 |
|
|
|
6,392 |
|
Foreign currency adjustments |
|
|
88 |
|
|
|
31 |
|
|
|
(2,770 |
) |
|
|
(1,528 |
) |
Total finite life intangible assets |
|
$ |
180,399 |
|
|
$ |
83,433 |
|
|
$ |
163,728 |
|
|
$ |
89,678 |
|
Amortization expense of finite life intangible assets was $16.1 million, $8.7 million and $7.4 million for 2025, 2024 and 2023, respectively. Amortization over the next five years for finite life intangibles is expected to be $15.5 million in 2026, $14.6 million in 2027, $13.7 million in 2028, $12.3 million in 2029, $11.1 million in 2030, and $28.5 million thereafter. The weighted average amortization periods for finite life intangible assets was 7.9 years as of December 31, 2025, inclusive of weighted average amortization periods for technology, customer lists, and tradenames of 5.6, 8.2, and 7.7 years, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 2, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Mar 5, 2024 | |
| 2022 | Mar 6, 2023 | |
| 2021 | Mar 14, 2022 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.