Goodwill and Intangible Assets
Goodwill represents the excess of cost over the fair value of net assets acquired. Goodwill amounted to $142.0 million and $139.9 million as of June 30, 2025 and June 30, 2024, respectively. The Company had one acquisition resulting in goodwill during each of the years ended June 30, 2025 and 2024, see additional information in Note 11 “Acquisitions.” Goodwill is not amortized.
Pursuant to ASC 350, “Intangibles — Goodwill and Other,” we review the recoverability of goodwill annually as of April 1 or whenever significant events or changes occur which might impair the recovery of recorded amounts. For purposes of the annual goodwill impairment assessment for fiscal year 2025, the Company identified two reporting units, East and West. There were no indicators of impairment identified and no goodwill impairments recorded during the years ended June 30, 2025 and 2024.
The following table summarizes the changes in goodwill for the fiscal years ended June 30:
| | | | | | | | | | | |
| in thousands | 2025 | | 2024 |
| Balance as of beginning of period | $ | 139,949 | | | $ | 124,217 | |
| Goodwill acquired during the period | 2,097 | | | 15,732 | |
| Balance as of end of period | $ | 142,046 | | | $ | 139,949 | |
Intangible assets consisted of the following as of June 30:
| | | | | | | | | | | |
| in thousands | 2025 | | 2024 |
| Definite-lived intangible assets | | | |
| Customer relationships | $ | 6,600 | | | $ | 6,600 | |
| Indefinite-lived intangible assets | | | |
| Permits | 2,000 | | | 2,000 | |
| Total intangible assets | 8,600 | | | 8,600 | |
| Accumulated amortization | (4,723) | | | (4,062) | |
| Balance as of end of period | $ | 3,877 | | | $ | 4,538 | |
Intangible assets with a finite useful life continue to be amortized over their useful lives. The Company recorded amortization expense of $0.7 million for each of the years ended June 30, 2025 and 2024.
The total expected future annual amortization expense for the next 5 years ended June 30, is as follows:
| | | | | |
| in thousands | Amortization Expense |
| 2026 | $ | 660 | |
| 2027 | 630 | |
| 2028 | 540 | |
| 2029 | 49 | |
| 2030 | — | |
We review the recoverability of other intangible assets in conjunction with long-lived assets whenever events or changes in circumstances indicate the carrying amount of such assets may not be recoverable. There were no intangible asset impairments recorded during the years ended June 30, 2025 and 2024.
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.