COVENANT LOGISTICS GROUP, INC. Goodwill & Intangibles Disclosure

9.	GOODWILL, INTANGIBLES, AND OTHER ASSETS

 

The Landair trade name has a residual value of $0.5 million. 

 

Amortization expense of $10.8 million, $9.5 million, and $7.5 million for the years ended December 31, 2025, 2024, and 2023, respectively, was included in depreciation and amortization in the consolidated statements of operations.

 

A summary of other intangible assets, by reportable segment as of  December 31, 2025 and 2024 is as follows:

 

(in thousands)		December 31, 2025
		Gross intangible assets				Accumulated amortization				Net intangible assets				Remaining Life (months)
Trade name:
Dedicated		$	4,502			$	(2,689	)		$	1,813
Managed Freight			1,089				(927	)			162
Warehousing			999				(885	)			114
Total trade name			6,590				(4,501	)			2,089				86
Non-Compete agreement:
Dedicated			4,670				(3,113	)			1,557
Managed Freight			630				(238	)			392
Total non-compete agreement			5,300				(3,351	)			1,949				15
Customer relationships:
Dedicated			71,374				(16,959	)			54,415
Managed Freight			22,112				(3,264	)			18,848
Warehousing			12,436				(7,772	)			4,664
Total customer relationships:			105,922				(27,995	)			77,927				131
Credentialing:
Expedited			32,000				(8,356	)			23,644
Total credentialing			32,000				(8,356	)			23,644				133
Total other intangible assets		$	149,812			$	(44,203	)		$	105,609				128

 

(in thousands)		December 31, 2024
		Gross intangible assets				Accumulated amortization				Net intangible assets				Remaining Life (months)
Trade name:
Dedicated		$	4,502			$	(2,479	)		$	2,023
Managed Freight			1,089				(910	)			179
Warehousing			999				(885	)			114
Total trade name			6,590				(4,274	)			2,316				98
Non-Compete agreement:
Dedicated			4,670				(1,946	)			2,724
Managed Freight			380				(127	)			253
Total non-compete agreement			5,050				(2,073	)			2,977				28
Customer relationships:
Dedicated			60,172				(12,142	)			48,030
Managed Freight			7,312				(1,987	)			5,325
Warehousing			12,436				(6,736	)			5,700
Total customer relationships			79,920				(20,865	)			59,055				149
Credentialing:
Expedited			32,000				(6,222	)			25,778
Total credentialing			32,000				(6,222	)			25,778				145
Total other intangible assets		$	123,560			$	(33,434	)		$	90,126				142

 

The above finite-lived intangible assets have a weighted average remaining life of 128 months and 142 months as of  December 31, 2025 and 2024, respectively.

 

The expected amortization expense of these assets for the next five years is as follows:

 

		(In thousands)
2026		$	12,001
2027			11,191
2028			10,732
2029			10,705
2030			9,215
Thereafter			51,265

 

The assignment of goodwill and intangible assets to our reportable segments was not complete as of December 31, 2025 as the result of the October 2025 Star Acquisition. The carrying amount of goodwill was $80.5 million at  December 31, 2025, compared to $78.9 million at December 31, 2024. A summary of the changes in carrying amount of goodwill by reportable segment is as follows:

 

(in thousands)		Expedited				Dedicated				Managed Freight				Warehousing				Total
Balance at December 31, 2024		$	15,699			$	32,575			$	8,917			$	21,750			$	78,941
Acquired goodwill for Star			-				-				12,034				-				12,034
Impairment of goodwill			-				(10,698	)			-				-				(10,698	)
Post-acquisition goodwill adjustments			-				-				200				-				200
Balance at December 31, 2025		$	15,699			$	21,877			$	21,151			$	21,750			$	80,477

 

A summary of other assets as of December 31, 2025 and 2024 is as follows:

 

(in thousands)		2025				2024
Investment in TEL		$	85,512			$	77,405
Other assets, net			11,914				9,065
Total other assets, net		$	97,426			$	89,633

 

Other long-term assets, net primarily represents amounts related to life insurance policies purchased with the intent to fund the future liability related to our nonqualified deferred compensation plan and the long-term portion of our prepaid expenses as of December 31, 2025, and 2024.

 

Additionally, the Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Impairment is recognized on assets classified as held and used when the sum of undiscounted estimated cash flows expected to result from the use of the asset is less than the carrying value. If such measurement indicates a possible impairment, the estimated fair value of the asset is compared to its net book value to measure the impairment charge, if any. As a result of the Dedicated reportable segment goodwill impairment during the three months ended  December 31, 2025, we performed an interim review of the related long-lived assets for impairment with no such impairment identified.