SCOTTS MIRACLE-GRO COSMG
SCOTTS MIRACLE-GRO CO Goodwill & Intangibles Disclosure
GOODWILL AND INTANGIBLE ASSETS, NET
The following table displays a rollforward of the carrying amount of goodwill by reportable segment:
| U.S. Consumer | Hawthorne | Reportable Segment Total | |||||||||||||||
| Goodwill | $ | 245.7 | $ | 617.0 | $ | 862.7 | |||||||||||
| Accumulated impairment losses | (1.8) | (617.0) | (618.8) | ||||||||||||||
| Balance at September 30, 2023 | 243.9 | — | 243.9 | ||||||||||||||
| Goodwill | 245.7 | 617.0 | 862.7 | ||||||||||||||
| Accumulated impairment losses | (1.8) | (617.0) | (618.8) | ||||||||||||||
| Balance at September 30, 2024 | 243.9 | — | 243.9 | ||||||||||||||
| Goodwill | 245.7 | 617.0 | 862.7 | ||||||||||||||
| Accumulated impairment losses | (1.8) | (617.0) | (618.8) | ||||||||||||||
| Balance at September 30, 2025 | $ | 243.9 | $ | — | $ | 243.9 | |||||||||||
The following table presents intangible assets, net of accumulated amortization and impairment charges:
| September 30, 2025 | September 30, 2024 | ||||||||||||||||||||||||||||||||||
| Gross Carrying Amount | Accumulated Amortization/ Impairment Charges | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization/ Impairment Charges | Net Carrying Amount | ||||||||||||||||||||||||||||||
| Finite-lived intangible assets: | |||||||||||||||||||||||||||||||||||
| Trade names | $ | 320.5 | $ | (275.7) | $ | 44.8 | $ | 325.8 | $ | (272.8) | $ | 53.0 | |||||||||||||||||||||||
| Customer relationships | 246.3 | (223.8) | 22.5 | 253.1 | (223.9) | 29.2 | |||||||||||||||||||||||||||||
| Technology | 50.1 | (46.4) | 3.7 | 50.2 | (45.5) | 4.7 | |||||||||||||||||||||||||||||
| Other | 34.5 | (27.6) | 6.9 | 35.0 | (27.0) | 8.0 | |||||||||||||||||||||||||||||
| Total finite-lived intangible assets, net | 77.9 | 94.9 | |||||||||||||||||||||||||||||||||
| Indefinite-lived intangible assets: | |||||||||||||||||||||||||||||||||||
| Indefinite-lived trade names | 168.2 | 168.2 | |||||||||||||||||||||||||||||||||
Roundup® marketing agreement amendment | 155.7 | 155.7 | |||||||||||||||||||||||||||||||||
| Total indefinite-lived intangible assets | 323.9 | 323.9 | |||||||||||||||||||||||||||||||||
| Total intangible assets, net | $ | 401.8 | $ | 418.8 | |||||||||||||||||||||||||||||||
As a result of the annual impairment testing for fiscal 2025 and 2024, the Company determined that no goodwill impairment charges were required. Refer to “NOTE 3. IMPAIRMENT, RESTRUCTURING AND OTHER” for further details of intangible asset impairment charges recorded during fiscal 2025 and 2024.
During fiscal 2023, the Company identified circumstances that indicated the carrying amounts of Hawthorne’s long-lived assets, including trade names and customer relationships, may not be recoverable. Accordingly, the Company performed a recoverability test for long-lived assets during the fourth quarter of fiscal 2023. The Company concluded that the carrying value of these long-lived assets exceeded their estimated fair value and recorded non-cash, pre-tax impairment charges of $72.0 related to trade names and $45.7 related to customer relationships during the fourth quarter of fiscal 2023 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations. The fair values of long-lived assets were determined using income-based approaches, including the relief-from-royalty method for trade names, that include market participant expectations of cash flows that the assets will generate over the remaining useful life discounted to present value using an appropriate discount rate. These fair value estimates utilize significant unobservable inputs and thus represent Level 3 fair value measurements.
During fiscal 2023, the annual goodwill impairment testing resulted in a non-cash, pre-tax goodwill impairment charge of $10.3 related to the Other segment, which was recorded during the fourth quarter of fiscal 2023 in the “” line in the Consolidated Statements of Operations. The carrying value of goodwill of the Other segment reporting unit after recognizing the impairment is zero. The estimated fair value of the Other segment reporting unit was based upon an equal weighting of the income-based and market-based approaches, utilizing estimated cash flows and a terminal value, discounted at a rate of return that reflects the relative risk of the cash flows, as well as valuation multiples derived from comparable publicly traded companies that are applied to the operating performance of the reporting unit. The fair value estimate utilizes significant unobservable inputs and thus represents a Level 3 fair value measurement.
Total amortization expense was $12.3, $15.7 and $25.2 for fiscal 2025, fiscal 2024 and fiscal 2023, respectively. Amortization expense is estimated to be as follows for the years ending September 30:
| 2026 | $ | 10.7 | |||
| 2027 | 10.1 | ||||
| 2028 | 8.6 | ||||
| 2029 | 6.4 | ||||
| 2030 | 6.2 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Nov 25, 2025 | Showing above |
| 2024 | Nov 26, 2024 | |
| 2023 | Nov 22, 2023 | |
| 2022 | Nov 28, 2022 | |
| 2021 | Nov 23, 2021 | |
| 2020 | Nov 24, 2020 | |
| 2019 | Nov 27, 2019 | |
| 2018 | Nov 29, 2018 | |
| 2017 | Nov 28, 2017 | |
| 2016 | Nov 28, 2016 | |
| 2015 | Nov 24, 2015 | |
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.