Fortune Brands Innovations, Inc. Goodwill & Intangibles Disclosure
The following table summarizes the changes in the carry value of goodwill by segment:
(In millions) |
|
Water |
|
|
|
Outdoors |
|
|
Security |
|
|
Total |
|
||||
Balance at December 30, 2023(a) |
|
$ |
1,129.3 |
|
|
|
$ |
651.1 |
|
|
$ |
126.4 |
|
|
$ |
1,906.8 |
|
Foreign currency translation adjustments and other |
|
|
(5.3 |
) |
|
|
|
— |
|
|
|
(1.2 |
) |
|
|
(6.5 |
) |
Acquisition-related adjustments |
|
|
87.2 |
|
|
|
|
— |
|
|
|
4.5 |
|
|
|
91.7 |
|
Balance at December 28, 2024(a) |
|
$ |
1,211.2 |
|
|
|
$ |
651.1 |
|
|
$ |
129.7 |
|
|
$ |
1,992.0 |
|
Foreign currency translation adjustments and other |
|
|
13.7 |
|
|
|
|
— |
|
|
|
0.7 |
|
|
|
14.4 |
|
Balance at December 27, 2025(a) |
|
$ |
1,224.9 |
|
|
|
$ |
651.1 |
|
|
$ |
130.4 |
|
|
$ |
2,006.4 |
|
The gross carrying value and accumulated amortization for each major category of intangible asset are as follows:
|
As of December 27, 2025 |
|
As of December 28, 2024 |
|
||||||||||||||
(In millions) |
Gross |
|
Accumulated |
|
Net Book |
|
Gross |
|
Accumulated |
|
Net Book |
|
||||||
Indefinite-lived tradenames |
$ |
519.8 |
|
$ |
— |
|
$ |
519.8 |
|
$ |
518.8 |
|
$ |
— |
|
$ |
518.8 |
|
Amortizable intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Tradenames |
|
78.8 |
|
|
(17.8 |
) |
|
61.0 |
|
|
76.1 |
|
|
(13.1 |
) |
|
63.0 |
|
Customer and contractual relationships |
|
1,024.0 |
|
|
(408.4 |
) |
|
615.6 |
|
|
1,015.5 |
|
|
(346.2 |
) |
|
669.3 |
|
Patents/proprietary technology |
|
140.9 |
|
|
(105.6 |
) |
|
35.3 |
|
|
138.9 |
|
|
(92.8 |
) |
|
46.1 |
|
Total |
|
1,243.7 |
|
|
(531.8 |
) |
|
711.9 |
|
|
1,230.5 |
|
|
(452.1 |
) |
|
778.4 |
|
Total identifiable intangibles |
$ |
1,763.5 |
|
$ |
(531.8 |
) |
$ |
1,231.7 |
|
$ |
1,749.3 |
|
$ |
(452.1 |
) |
$ |
1,297.2 |
|
Amortizable intangible assets, principally customer relationships, are subject to amortization on a straight-line basis over their estimated useful life, ranging from 4 to 30 years, based on the assessment of a number of factors that may impact useful life, which include customer attrition rates and other relevant factors. We expect to record intangible amortization of approximately $74.0 million in 2026, $71.0 million in 2027, $64.0 million in 2028, $63.0 million in 2029 and $63.0 million in 2030.
During the fourth quarter of 2023, a reduction of revenue growth expectations, which were finalized during our annual planning process, led us to conclude that it was more likely than not that two indefinite-lived tradenames within our Outdoors segment were impaired. As a result of impairment tests performed, we recorded an of $33.5 million related to the two indefinite-lived tradenames. As of December 30, 2023, the carrying value of these tradenames was $95.5 million.
No impairments to identifiable intangible assets were recognized in 2025 or 2024.
The fair values of the impaired tradenames were measured using the relief-from-royalty approach, which estimates the present value of royalty income that could be hypothetically earned by licensing the tradename to a third party over its remaining useful life. Some of the more significant assumptions inherent in estimating the fair values include forecasted revenue growth rates, assumed royalty rates, and market-participant discount rates that reflect the level of risk associated with the tradenames’ future revenues and profitability. We selected the assumptions used in the financial forecasts using historical data, supplemented by current and anticipated market conditions, estimated growth rates and management plans. These assumptions represent level 3 inputs of the fair value hierarchy (refer to Note 9, "Fair Value Measurements").
The significant assumptions used to estimate the fair value of the tradenames impaired during the year ended December 30, 2023 were as follows:
|
|
2023 |
|
|||||||||
Unobservable Input |
|
Minimum |
|
|
Maximum |
|
|
Weighted Average(a) |
|
|||
Discount rates |
|
|
13.0 |
% |
|
|
14.5 |
% |
|
|
14.3 |
% |
Royalty rates(b) |
|
|
2.5 |
% |
|
|
3.5 |
% |
|
|
3.4 |
% |
Long-term revenue growth rates(c) |
|
|
2.0 |
% |
|
|
3.0 |
% |
|
|
2.1 |
% |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 23, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Feb 25, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 25, 2016 | |
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.