Company: CHD
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000950170-25-019801
Chunk: 124

Company: CHURCH & DWIGHT CO INC /DE/
Filing Date: 2025-02-13
Form: 10-K
Item: Item 1B
Chunk 124
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 discounted cash flow model to determine the fair value of the trade name.  The assumptions used in the model require significant judgement in determining the expected future cash flows.  The key assumptions utilized in the Company's impairment analysis included, but were not limited, net sales growth rates between -15.2% and 2.1%, EBITA margins in the low single digits, and a discount rate of 8.25%.  Estimates are based on market conditions and management’s current expectation of the success of growth and profitability initiatives.  The valuation resulted in a full impairment of the $281.3 trade name.  The remaining carry value of the trade name at December 31, 2024 is $0.0. The Company also evaluated its ability to recover the carrying value of long-lived assets supporting the VMS business by comparing the carrying amount of those assets to the future undiscounted cash flows over the estimated life of the identified primary asset.  The result of this evaluation was that the cash flows would not be sufficient to recover the carrying value of the assets requiring the Company to compare the carrying value of those assets to their fair value.  The Company used an excess earnings discounted cash flow model to determine the estimated fair value of the long-lived assets.  The key assumptions utilized in the Company's impairment analysis were the same as those used to estimate the fair value of the trade name.  The valuation resulted in a fair value of the long-lived assets that is below their carry value requiring a pre-tax impairment charge of $75.8.  The impairment charge was allocated $60.0 to the PP&E of the VMS business and $15.8 to the remaining customer relationship intangible asset.  The remaining carrying values of the PP&E and the customer relationship intangible asset specific to the VMS business at December 31, 2024 are $140.7 and $0.0, respectively. A summary of the VMS intangible and fixed asset impairment charges are as follows:

        December 31,

        2024

        Trade Name
        $
        281.3

        Customer Relationship Intangible Asset
         
        15.8

        PP&E
         
        60.0

        Total VMS impairment charges
        $
        357.1

       The Company’s global WATERPIK business has continued to experience a significant decline in customer demand for many of its products, primarily due to lower consumer spending for discretionary products from inflation and a growing number of