PENSKE AUTOMOTIVE GROUP, INC.PAG

PENSKE AUTOMOTIVE GROUP, INC. Goodwill & Intangibles Disclosure

10-KFiled Feb 27, 20263 min read
Intangible Assets
The following is a summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets during the years ended December 31, 2025, and 2024:
GoodwillOther Indefinite-Lived Intangible
Assets
Balance — December 31, 2023 (1)
$2,239.9 $877.3 
Additions175.8 284.2 
Disposals(9.0)(3.7)
Impairment— (1.8)
Foreign currency translation(30.4)(15.3)
Balance — December 31, 2024 (1)
$2,376.3 $1,140.7 
Additions11.8 17.9 
Disposals(10.7)(18.6)
Impairment— (3.4)
Foreign currency translation58.3 27.6 
Balance — December 31, 2025 (1)
$2,435.7 $1,164.2 
____________________
(1)Net of accumulated goodwill impairment losses of $647.0 million
The following is a summary of the changes in the carrying amount of goodwill by reportable segment during the years ended December 31, 2025, and 2024:
Retail
Automotive		Retail
Commercial
Truck		OtherTotal
Balance — December 31, 2023
$1,669.0 $494.3 $76.6 $2,239.9 
Additions162.5 13.3 — 175.8 
Disposals(6.0)(3.0)— (9.0)
Foreign currency translation(16.7)(7.1)(6.6)(30.4)
Balance — December 31, 2024
$1,808.8 $497.5 $70.0 $2,376.3 
Additions11.8 — — 11.8 
Disposals(10.7)— — (10.7)
Foreign currency translation49.2 3.9 5.2 58.3 
Balance — December 31, 2025
$1,859.1 $501.4 $75.2 $2,435.7 
For reporting units within our Retail Automotive, Retail Commercial Truck, and Other reportable segments, we prepared a quantitative assessment of the carrying value of goodwill. We estimated the fair value of our reporting units using an income approach. The income approach measures fair value by discounting expected future cash flows at a weighted average cost of capital. We also validate the fair value for each reporting unit using the income approach by calculating a cash earnings multiple and determining whether the multiple was reasonable compared to recent market transactions completed by the Company or in the industry. As part of that assessment, we also reconcile the estimated aggregate fair values of our reporting units to our market capitalization as of the assessment date. We believe this reconciliation process is consistent with a market participant perspective. This consideration would also include a control premium that represents the estimated amount an investor would pay for our equity securities to obtain a controlling interest and other significant assumptions, including revenue growth, terminal growth rates, EBITDA margin, and the weighted average cost of capital.
Based on our assessment as of October 1, 2025, and in conjunction with our fourth quarter annual forecasting process for 2026 which impacts key assumptions used in our goodwill impairment assessment, we concluded that for each of our reporting units that the fair values were more likely than not greater than their carrying values. As a result, we had no goodwill impairment charges in 2025. We also had no goodwill impairment charges in 2024.
For our other indefinite-lived intangible assets, we prepared a quantitative assessment as of October 1, 2025, by comparing the fair value to its carrying value. We estimated the fair value using an income approach, applying similar methodology as discussed above. As a result of this assessment, and in conjunction with the sale of a certain franchised dealership in the U.S. during 2025, we had $3.4 million of impairment charges relating to our other indefinite-lived intangible assets. We also had $1.8 million of impairment charges relating to our other indefinite-lived intangible assets during 2024.

Historical Timeline

Fiscal YearFiled
2025Feb 27, 2026Showing above
2024Feb 21, 2025
2023Feb 16, 2024
2022Feb 21, 2023
2021Feb 18, 2022
2020Feb 19, 2021
2019Feb 21, 2020
2018Feb 22, 2019
2017Feb 22, 2018
2016Feb 24, 2017
2015Feb 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.

Other Available Disclosures

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