Company: CHD
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000950170-25-019801
Chunk: 288

Company: CHURCH & DWIGHT CO INC /DE/
Filing Date: 2025-02-13
Form: 10-K
Item: Item 8
Chunk 288
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  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 water flosser consumers switching to more value-branded products.  As a result, the WATERPIK business has experienced declining sales and profits resulting in a reduction in expected future cash flows which have eroded a substantial portion of the excess between the fair and carrying value of the trade name. This indefinite-lived intangible asset may be susceptible to impairment and a continued decline in fair value could trigger a future impairment charge of the WATERPIK trade name. The carrying value of the WATERPIK trade name was $644.7 and fair value represented 135% of the carrying value as of October 1, 2024 (the date of the Company's last annual impairment test). The fair value represented 109% of the carrying value as of October 1, 2023.  The increase in fair value is mainly attributable to a favorable tariff ruling on certain Waterpik products imported from China.  The key assumptions used in the projections from the