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

Sep. 30, 2023

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):


	September 30, 2023		October 1, 2022
Balance at beginning of the year	$	173,513	$	101,114
Acquisitions, net of measurement period adjustments		7,185		72,399
Balance at the end of the year	$	180,698	$	173,513

Other Intangible Assets

Other intangible assets consisted of the following as of September 30, 2023 (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)		9.8	$	26,740	$	(7,958	)	$	18,782
Trade name and trademarks (indefinite life)	Indefinite			9,350		—			9,350
Non-compete agreements		5.4		8,683		(7,585	)		1,098
Consumer relationships		7.4		24,100		(15,317	)		8,783
Other intangibles		5.1		6,620		(6,476	)		144
Total			$	75,493	$	(37,336	)	$	38,157

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

Amortization expense was $4.3 million, $3.0 million, and $2.2 million in fiscal 2023, 2022, and 2021, respectively. No impairment of goodwill or other intangible assets was recorded during fiscal 2023, 2022, and 2021.

In 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 September 30, 2023 (in thousands):


	Amount
2024	$	3,693
2025		3,596
2026		3,350
2027		3,226
2028		2,273
Thereafter		12,669
Total	$	28,807