Leslie's, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Goodwill and Other Intangibles, Net

Goodwill and Other Intangibles, Net

12 Months Ended

Oct. 01, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangibles, Net

Note 4—Goodwill and Other Intangibles, Net

Goodwill

The following table details the changes in goodwill (in thousands):


	October 1, 2022		October 2, 2021
Balance at beginning of the year	$	101,114	$	93,295
Acquisitions, net of measurement period adjustments		72,399		7,819
Balance at the end of the year	$	173,513	$	101,114

Other Intangible Assets

Other intangible assets consisted of the following as of October 1, 2022 (in thousands, except weighted average remaining useful life):


	Weighted Average Remaining Useful Life (in Years)		Gross Carrying Value		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks (finite life)		11.0	$	24,440	$	(5,907	)	$	18,533
Trade name and trademarks (indefinite life)	Indefinite			9,350		—			9,350
Non-compete agreements		6.5		8,683		(7,379	)		1,304
Consumer relationships		7.9		24,100		(13,339	)		10,761
Other intangibles		6.2		6,620		(6,380	)		240
Total			$	73,193	$	(33,005	)	$	40,188

Other intangible assets consisted of the following as of October 2, 2021 (in thousands, except weighted average remaining useful life):


	Weighted Average Remaining Useful Life (in Years)		Gross Carrying Value		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks (finite life)		6.6	$	5,940	$	(5,274	)	$	666
Trade name and trademarks (indefinite life)	Indefinite			17,750		—			17,750
Non-compete agreements		7.5		8,633		(7,123	)		1,510
Consumer relationships		6.4		19,000		(11,688	)		7,312
Other intangibles		7.0		6,620		(5,952	)		668
Total			$	57,943	$	(30,037	)	$	27,906

Other intangible assets consisted of the following as of October 3, 2020 (in thousands, except weighted average remaining useful life):


	Weighted Average Remaining Useful Life (in Years)		Gross Carrying Value		Accumulated Amortization			Net Carrying Amount
Trade name and trademarks (finite life)		3.6	$	5,540	$	(5,139	)	$	401
Trade name and trademarks (indefinite life)	Indefinite			17,750		—			17,750
Non-compete agreements		8.3		8,633		(6,872	)		1,761
Consumer relationships		6.1		17,200		(10,118	)		7,082
Other intangibles		7.4		6,584		(5,687	)		897
Total			$	55,707	$	(27,816	)	$	27,891

Amortization expense was $3.0 million, $2.2 million, and $2.6 million in fiscal 2022, 2021, and 2020, respectively. No impairment of goodwill or other intangible assets was recorded during fiscal 2022, 2021, and 2020.

In the fourth quarter of fiscal 2022, an $8.4 million indefinite-lived trade name intangible asset was reclassified to a finite-lived intangible asset due to a change in the way the asset will be utilized in the future. Prior to reclassifying the trade name to a finite-lived intangible asset, the Company tested it for impairment and determined that the fair value of the asset exceeded the carrying value. This trade name was assigned a 10-year estimated useful life and will be amortized over its useful life on a prospective basis.

The following table summarizes the estimated future amortization expense related to finite-lived intangible assets on our consolidated balance sheet as of October 1, 2022 (in thousands):


	Amount
2023	$	3,507
2024		2,868
2025		2,772
2026		2,525
2027		2,402
Thereafter		16,764
Total	$	30,838