Company: EME
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000105634-25-000015
Chunk: 116

Company: EMCOR Group, Inc.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 8
Chunk 116
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 balance at December 31, 2024 and 2023 was $1,018.4 million and $956.5 million, respectively, with goodwill attributable to companies acquired in 2024 and 2023 valued at $61.9 million and $37.4 million, respectively. Goodwill is not amortized but instead allocated to its respective reporting unit and evaluated for impairment annually, or more frequently if events or circumstances indicate that the carrying amount of goodwill may be impaired. We have determined that our reporting units are consistent with the reportable segments identified in Note 18 - Segment Information of the notes to consolidated financial statements. As of December 31, 2024, approximately 18.8% of our goodwill related to our United States electrical construction and facilities services segment, approximately 33.8% of our goodwill related to our United States mechanical construction and facilities services segment, approximately 35.2% of our goodwill related to our United States building services segment and approximately 12.2% of our goodwill related to our United States industrial services segment. Absent any earlier identified impairment indicators, we perform our annual goodwill impairment assessment on October 1 each fiscal year. Qualitative indicators that may trigger the need for interim quantitative impairment testing include, among others, deterioration in macroeconomic conditions, declining financial performance, deterioration in the operational environment, or an expectation of selling or disposing of a portion of a reporting unit. Additionally, an interim impairment test may be triggered by a significant change in business climate, a loss of a significant customer, increased competition, or a sustained decrease in share price. In assessing whether our goodwill is impaired, we compare the fair value of the reporting unit to its carrying amount, including goodwill. If the fair value exceeds the carrying amount, no impairment is recognized. However, if the carrying amount of the reporting unit exceeds the fair value, the goodwill of the reporting unit is impaired and an impairment loss in the amount of the excess is recognized and charged to operations.We performed our annual impairment assessment of all reporting units as of October 1, 2024 and determined there was no impairment of goodwill. In completing our annual impairment assessment, we determined the fair value of each of our reporting units using an income approach whereby fair value was calculated utilizing discounted estimated future cash flows, assuming a risk-adjusted industry weighted average cost of capital. The weighted average cost of capital used in our annual impairment testing was 10.6% for our United States construction segments, 10.9% for our United States building services